Regime change from 20,000 feet

Nothing would rock the markets like a U.S. attack on Iran.  Which makes the headlines of the last 24 hours worth examining closely.

We begin with what could have been an extremely close call — a raid at the Baghdad Sheraton, during which U.S. forces arrested eight people from the Iranian Electricity Ministry who were in town to negotiate a deal with the Iraqi government.  They were later released, found to have done nothing wrong, but only after the intervention of Iraq’s prime minister, Nuri al-Maliki.  (Who says he’s an ineffective doofus?)

But before it was all over, the eight men were bound and blindfolded, and trotted before TV cameras – which struck me as about as provocative a move as Washington could ever orchestrate.  Well, maybe it wasn’t orchestrated, it might well have been an accident, but to give those guys the same treatment as the U.S. embassy hostages in Tehran in 1979 sure seems like rubbing the mullahs’ face in it.

So that’s one provocation that hasn’t panned out.  But there are always presidential speeches.  And George W. Bush delivered a doozy yesterday to the American Legion:

Iran’s active pursuit of technology that could lead to nuclear weapons threatens to put a region already known for instability and violence under the shadow of a nuclear holocaust.

Iran’s actions threaten the security of nations everywhere. And that is why the United States is rallying friends and allies around the world to isolate the regime, to impose economic sanctions. We will confront this danger before it is too late.

And a new study from Britain concludes that confrontation could come, not after months of wrangling at the UN, but rather with no warning:

The United States has the capacity for and may be prepared to launch without warning a massive assault on Iranian uranium enrichment facilities, as well as government buildings and infrastructure, using long-range bombers and missiles, according to a new analysis.

From the executive summary of the analysis:

The study concludes that the US has made military preparations to destroy Iran’s WMD, nuclear energy, regime, armed forces, state apparatus and economic infrastructure within days if not hours of President George W. Bush giving the order. The US is not publicising the scale of these preparations to deter Iran, tending to make confrontation more likely. The US retains the option of avoiding war, but using its forces as part of an overall strategy of shaping Iran’s actions.

But it’s only in the body of the study that you grasp what’s being contemplated here – regime change accomplished almost exclusively through air power:

This wider form of air attack would be the most likely to delay the Iranian nuclear program for a sufficiently long period of time to meet the administration’s current counterproliferation goals. It would also be consistent with the possible goal of employing military action is to overthrow the current Iranian government, since it would severely degrade the capability of the Iranian military (in particular revolutionary guards units and other ultra-loyalists) to keep armed opposition and separatist movements under control. It would also achieve the US objective of neutralizing Iran as a power in the region for many years to come.

The thought that a bombing campaign just might have the effect of rallying the fractured Iranian population around its unpopular leaders is not entertained in this study.  And why should it?  It’s certainly not being entertained in the White House.  This is the crowd that expected flowers and candy to be strewn at the feet of soldiers marching through Baghdad.

(In fact, Iran’s nuclear program is one of the few things that unite most Iranians.  It’s a source of national pride — among other things.)

But enough of how Iranians might react.  What of the Americans?  Would they buy into yet another war, from the same president who bamboozled them into the last one?

Pat Buchanan answers unequivocally: Yes.

George Bush and his generals are laying out the case for a new war. And there has been no resistance offered either by a vacationing Congress or the major presidential candidates.

Bush, he says, has given himself no outs with his rhetoric accusing Iran’s al-Quds force of training Iraqis to kill U.S. troops:

Whether Bush has made the decision to attack the al-Quds training camps inside Iran, he has painted himself into a corner. If he does not strike the camps, he will be mocked by the War Party as a weak commander in chief, too timid to use U.S. power to protect soldiers he sent into battle or to punish those killing them. Thus, Bush must either announce that his diplomacy has worked, and attacks out of Iran have diminished or been halted, or he will have to explain why the Top Gun of the carrier Lincoln was too wimpish to do his duty by the soldiers he sent to fight.

Yes, Americans will undoubtedly rally ‘round the flag, for the same reasons they always do.  As Bill Bonner noted in yesterday’s DR, “Fish gotta swim; birds gotta fly; and empires gotta live by the sword until they are finally put to death by it. War also appeals to Americans, more than to, say, Germans or Japanese, because war has been good to them.”

Bill and co-author Lila Rajiva reflect on how crowds rally to the sword and markets rally to nonsensical heights in their new book, Mobs, Messiahs, and Markets.  Friday is the release date; you can pre-order here.

The Daily Reckoning