Lyndon B Johnson

Economically, the American Empire was born with Bretton Woods in 1945. The U.S. dollar was not fully convertible to gold, but was made convertible to gold only to foreign governments. This established the dollar as the reserve currency of the world. It was possible, because during WWII, the United States had supplied its allies with provisions, demanding gold as payment, thus accumulating significant portion of the world's gold. An Empire would not have been possible if, following the Bretton Woods arrangement, the dollar supply was kept limited and within the availability of gold, so as to fully exchange back dollars for gold. However, the guns-and-butter policy of the 1960's was an imperial one: the dollar supply was relentlessly increased to finance Vietnam and LBJ's Great Society. Most of those dollars were handed over to foreigners in exchange for economic goods, without the prospect of buying them back at the same value. The increase in dollar holdings of foreigners via persistent U.S. trade deficits was tantamount to a tax—the classical inflation tax that a country imposes on its own citizens, this time around an inflation tax that U.S. imposed on rest of the world.

When in 1970-1971 foreigners demanded payment for their dollars in gold, The U.S. Government defaulted on its payment on August 15, 1971. While the popular spin told the story of "severing the link between the dollar and gold", in reality the denial to pay back in gold was an act of bankruptcy by the U.S. Government. Essentially, the U.S. declared itself an Empire. It had extracted an enormous amount of economic goods from the rest of the world, with no intention or ability to return those goods, and the world was powerless to respond— the world was taxed and it could not do anything about it.

From that point on, to sustain the American Empire and to continue to tax the rest of the world, the United States had to force the world to continue to accept ever-depreciating dollars in exchange for economic goods and to have the world hold more and more of those depreciating dollars. It had to give the world an economic reason to hold them, and that reason was oil.

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The economic essence of this arrangement was that the dollar was now backed by oil. As long as that was the case, the world had to accumulate increasing amounts of dollars, because they needed those dollars to buy oil. As long as the dollar was the only acceptable payment for oil, its dominance in the world was assured, and the American Empire could continue to tax the rest of the world. If, for any reason, the dollar lost its oil backing, the American Empire would cease to exist. Thus, Imperial survival dictated that oil be sold only for dollars. It also dictated that oil reserves were spread around various sovereign states that weren't strong enough, politically or militarily, to demand payment for oil in something else. If someone demanded a different payment, he had to be convinced, either by political pressure or military means, to change his mind.

The man that actually did demand Euro for his oil was Saddam Hussein in 2000. At first, his demand was met with ridicule, later with neglect, but as it became clearer that he meant business, political pressure was exerted to change his mind. When other countries, like Iran, wanted payment in other currencies, most notably Euro and Yen, the danger to the dollar was clear and present, and a punitive action was in order. Bush's Shock-and-Awe in Iraq was not about Saddam's nuclear capabilities, about defending human rights, about spreading democracy, or even about seizing oil fields; it was about defending the dollar, ergo the American Empire. It was about setting an example that anyone who demanded payment in currencies other than U.S. Dollars would be likewise punished.

Many have criticized Bush for staging the war in Iraq in order to seize Iraqi oil fields. However, those critics can't explain why Bush would want to seize those fields--he could simply print dollars for nothing and use them to get all the oil in the world that he needs. He must have had some other reason to invade Iraq.

History teaches that an empire should go to war for one of two reasons: (1) to defend itself or (2) benefit from war; if not, as Paul Kennedy illustrates in his magisterial The Rise and Fall of the Great Powers, a military overstretch will drain its economic resources and precipitate its collapse. Economically speaking, in order for an empire to initiate and conduct a war, its benefits must outweigh its military and social costs. Benefits from Iraqi oil fields are hardly worth the long-term, multi-year military cost. Instead, Bush must have went into Iraq to defend his Empire. Indeed, this is the case: two months after the United States invaded Iraq, the Oil for Food Program was terminated, the Iraqi Euro accounts were switched back to dollars, and oil was sold once again only for U.S. dollars. No longer could the world buy oil from Iraq with Euro. Global dollar supremacy was once again restored. Bush descended victoriously from a fighter jet and declared the mission accomplished--he had successfully defended the U.S. dollar, and thus the American Empire.

The CIA's primary mission became fighting Communism. The first 3/4 of the book lay out how it attempted to accomplish this. The CIA's typical strategy involved identifying a country with the potential to elect a communist government, funding right-wing revolutionaries to overthrow said government, and helping a new government come into power.

In most cases, the new government would be headed by a violent fascist with no respect for law or liberty.

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LBJ got us into Vietnam because of poor intelligence. The Gulf of Tonkin incident was later revealed to be friendly-fire between two US warships, not an attack by the Communists. The error was discovered the same day LBJ ordered retaliatory strikes on Vietnam, but never reported to the legislature or the executive. The mistake was declassified in 2005.

Nixon had a bad habit of ignoring what the CIA told him when it contradicted his policies, even though the CIA was often right and Nixon was often wrong. Sound familiar? Nixon wanted to fight Communism everywhere and wanted the CIA to do it. One of his strongest legacies is the arms race for the cold war. He pressured the CIA for estimates of the Soviet's nuclear arsenal in line with his beliefs, and they delivered, overstating the true numbers until the end of the Cold War.

Carter decided to involve the US in the Soviet-Afghani war, ordering the CIA to funnel arms to the Afghan fighters resisting the Soviet invasion. The shipments went through Pakistani intelligence, which distributed them to the most effective fighters after keeping a fair share of the arms for themselves. The most effective fighters turned out to be the radical Muslims. Some of these fighters later formed the Taliban, of which you may have heard. They took power in Afghanistan in the mid-90's.

Reagan continued Nixon's legacy, using these overstated numbers to bolster the military-industrial complex and further the arms race with the Soviet Union. He approved of the shady arms dealing with Iran and the funding of rebels in Nicaragua and other parts of Central America.

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Bush had little use for the CIA before 9/11, ignoring their warnings that a major terrorist attack on American soil was looming. We all know how that turned out. He had great use for the agency after 9/11, convincing the higher-ups to find intelligence supporting the existence of WMD's in Iraq. We all know how that turned out, too.

It seems like the government wasn't screwing things up enough, so they needed to create a special department for to spend billions to come up with truely spectacular failures, then classify the worst of them.