There are a couple of reasons why attacking Iran is a bad idea, such a bad idea that even Israel is backing away. The main reason is that China needs Iranian oil. Without it the country could sputter economically, forcing it to raise cash. Selling our bonds when China is our biggest creditor is not a good omen for the world economy.

Secondly, it seems that Iran is moderating her positions. If that proves to be true, we can have a time of peace. But we need to see Israel make strong efforts at peace with the Palestinians, an issue that Iran is adamant about.   

Update: Joe Biden on July 5, 2009, reported that the administration has no plans to stop Israel from bombing Iran since that is a sovereign decision. Interesting that America doesn't have the sovereign power to dismantle the too-big-to-fail banks while Israel can risk major war in the middle east if she wants. But that is for another discussion.

The problem with this bombing of Iran is that it is unlikely to stop Iran from developing anything they want. They probably will just shake the bombings off and continue on. Better that Israel gets serious about setting up a two state solution in Palestine. Only then can the middle east become more secure.

I hate war, and I hate the fact that the United States went into Iraq to steal oil. I hate the fact that the government of the United States does not want total energy independence because of the fear that we will turn inward and not fight along side our allies. Indeed, many in the US government, mainly the neocons, believe that we must control the middle east, and control the petroleum resources.

Having said that I believe that the United States has been severely weakened by the Iraq War and the housing ponzi bubble that was hatched to fund that war. The American people are broke and tired of the neocon ways. But if you think that the neocons are going away you have it wrong. There are neocons or neocon friends in the Obama administration in key advisory positions. It is likely that Netanyahu and the Likud Party will dominate politics in Israel. That fact is likely to keep the neocons in our future for many years to come.

Like I have said, I hate war, but there is a looming conflict between Iran and Israel that could threated the entire middle east region. If Israel feels threatened by Iran then there are reasons to believe they really could be threatened. It is true that Iran has not attempted to invade another country. So some say that their threats are just talk. Peace negotiations should be explored by the US and Iran to make sure that these threats against Israel are just talk and nothing more. Certainly Iran is funding many who have attacked Israel.

So then, it is possible that these threats are more than talk. The right wing parties of Israel are convinced that the threats are not just sabre rattling but are in fact real threats. Iraq miscalculated the neocon resolve in the United States to steal oil and get rid of Saddam. Had they realized who they were dealing with, the Iraq leadership would have shouted from the top of their lungs that they had no WMD because truth was, they didn't! That may have given the neocons little power to invade. Certainly they miscalculated the power of the American forces.

With regard to Iran there are even more dangers to world peace if a war were to break out. The first danger is how Russia will react. This is a serious issue because Russia is not pleased to have a major war break out so close to them. So, the question becomes how the United States should proceed regarding Iran.

The United States should negotiate some real concessions from the Iranians. The United States, in my opinion, should not go to war with Iran at all. If the Israeli government perceives a failure with negotiations by Obama with the Iranians, what they decide to do rests with them. But America should not be involved directly because of our relationship with Russia. If Russia perceives that the United States is using an Iran war to weaken Russia in any way, this could result in a disaster and much greater war, even a World War 3. Or it could result in an economic division between Russia/China versus the United States.

So then, if the Israeli's are thinking about going to war with Iran they should not expect the United States to do anything but give them economic support. American CANNOT treat a war by Israel with Iran as an extension of an American Empire, though that is what the neocons would want. While America is the strongest military power in the world, the United States is economically weak and may continue in weakness for years. Empire building is not an answer because we could be worn down by any Chinese/Russian alliance.

And the reason that there will no doubt be a Russian/Chinese alliance is because of energy. China needs energy. We have taken Iraq oil contracts from the Chinese. They won't soon forget. They need the oil from Iran. This Chinese/Russian alliance complicates things for the United States, but also for Israel. All China and Russia have to do with regard to the United States is to quit buying treasury bonds. Who knows if they would do so if Iran were attacked, but it is a possibility.

So, how would this boycott of US treasury bonds impact the United States? Well, it could raise interest rates through the roof. The flooding of Russian and Chinese treasuries onto the market would put even more pressure on interest rates and the existing treasury bond bubble would burst big time! It is clear that there are risks too great for the US to invade Iran, and if Israel throws a few bombs toward Iran it is unlikely to stop their nuclear program.

The invasion of Iraq was a mistake on so many levels. One was that it could be that Iran is the greater real threat. Another level of mistake was that the United States is incredibly weakened economically because of the invasion.

I worry about the United States becoming an aggressor nation, with invasions based upon our own economic weakness. As a fellow said on CNBC awhile back, the Chinese make things and we sell each other insurance. If America turns into an aggressor nation then WW3 will be a real possibility. That is why I urge the leaders of our country to not get involved in any direct war with Iran. We are a debtor nation. We are economically weakened and we are in the grasp of Russia and China with regard to our need to sell treasury bonds. They may choose to use that treasury bond card if we become too aggressive toward Iran.

That makes the Iran issue an Israeli issue and a world issue, and it is crystal clear that both the Israelis and the world have a very difficult one. I have called for massive reparations (given by the world nations) for the palestinians on the condition that the palestinians live with Israel in a permanent peace. It is my view that Israel was sanctioned by the world, but land was stolen from the palestinians. So then, the world needs to fix the problem, and with that problem solved there may be a breakout of peace in the middle east. We can hope events move in that direction but we can be sure that this scenario is not close to being guaranteed.