Lethal Trajectories - Michael Conley [138]
Wang nodded and replied, “I see your point also. We ran some numbers last night, and taking all factors into consideration we figured that net oil reductions for both of our countries will be in the 21 to 22 percent range. By contrast, the reduction for a country like Japan that produces little if any oil would be slightly higher—somewhere around 25 percent.”
“Part of the contingency reserve would be used to true up some of these inequities for a non-oil-producing country like Japan, right?”
“Yes, but the Politburo will bristle at the idea of using any of our contingency reserve for Japan. That just isn’t going to happen.”
“Likewise,” Jack bristled, “I’m sure Congress will not be happy if, in addition to the 10 percent contingency reserve, we have to dip into our strategic petroleum reserve to cover foreign obligations such as helping Japan.”
Wang smiled at Jack’s statement, to Jack’s great irritation.
“I’m not smiling at your problem, Jack, but I can’t help but be amused that we probably have the makings of a good deal here. Someone once told me that the best deal of all is the one where all parties walk away thinking they didn’t get everything they wanted.”
Jack caught his drift and laughed. “You’re absolutely right; this is what good deal-making is all about. Are there are other issues you see with your Politburo, Peng?'
This was obviously a slippery slope, and Wang pondered the question before answering.
“China, as you know, has aggressively locked up as many oil markets as possible over the past ten years. There was no question in our minds years ago that oil was a finite resource that would decline amidst growing demand. My guess is the Politburo will feel that China has sufficient access to oil and doesn’t need the United States. In fact, they’ll see it as a way to leverage China’s position vis-à-vis America’s because they don’t believe America has the same access to oil as we do. Accordingly, they will pressure Lin Cheng not to relinquish authority on vital oil resources to an outside rationing system or agency.”
“That sounds like a heavy load to overcome,” Jack offered. “How will Lin Cheng get around it?”
“He’ll hammer away at the issues of access and affordability, particularly the latter. He’ll remind them that a destabilized oil market is not in China’s best interests, given the global nature of our economy. That includes the goods we export, our need for viable markets for our products, and the raw materials we import to make them. He’ll remind them of what the loss of so much of the world’s oil will do to oil prices and the paralyzing effect it will have on the global economy. More directly, I’m sure he’ll point out the likelihood of rising unemployment in their districts causing unrest amongst a disgruntled population. He will make every effort to show how they will be effected locally and suggest that our countries need to work together to get it resolved. The status quo is unsustainable. How do you think it’ll play out in America?”
“I talked to Clayton last night, and he’s behind the plan we worked out. He met with Peter Canton yesterday to go over a domestic oil rationing plan, and he said the United States will ration, no matter what we work out here. We all agree, however, that a cooperative plan with China would help solidify the whole rationing idea—you know, like we’re all in this together.”
“That’s good, but can Clayton sell it to Congress and the American people?”
“I won’t lie to you, Peng, it’s going to be a battle royal. The American people, and particularly the members of Congress, have gotten used to having things their own way. The very thought of rationing—and doing it in concert with China—will be repugnant to many, particularly the hardliners.”
“That sounds troublesome, Jack. How will he do it?”
“He plans to tell it like it is when he addresses Congress next Monday. He’ll mince no words about the magnitude of the crisis, and he’ll also address climate-change