Arkib: January 2009
Saturday, January 24th, 2009
We begin this year and this Administration in the midst of an unprecedented crisis that calls for unprecedented action. Just this week, we saw more people file for unemployment than at any time in the last twenty-six years, and experts agree that if nothing is done, the unemployment rate could reach double digits. Our economy could fall $1 trillion short of its full capacity, which translates into more than $12,000 in lost income for a family of four. And we could lose a generation of potential, as more young Americans are forced to forgo college dreams or the chance to train for the jobs of the future.
In short, if we do not act boldly and swiftly, a bad situation could become dramatically worse.
That is why I have proposed an American Recovery and Reinvestment Plan to immediately jumpstart job creation as well as long-term economic growth. I am pleased to say that both parties in Congress are already hard at work on this plan, and I hope to sign it into law in less than a month.
It’s a plan that will save or create three to four million jobs over the next few years, and one that recognizes both the paradox and the promise of this moment - the fact that there are millions of Americans trying to find work even as, all around the country, there’s so much work to be done. That’s why this is not just a short-term program to boost employment. It’s one that will invest in our most important priorities like energy and education; health care and a new infrastructure that are necessary to keep us strong and competitive in the 21st century.
Today I’d like to talk specifically about the progress we expect to make in each of these areas.
To accelerate the creation of a clean energy economy, we will double our capacity to generate alternative sources of energy like wind, solar, and biofuels over the next three years. We’ll begin to build a new electricity grid that lay down more than 3,000 miles of transmission lines to convey this new energy from coast to coast. We’ll save taxpayers $2 billion a year by making 75% of federal buildings more energy efficient, and save the average working family $350 on their energy bills by weatherizing 2.5 million homes.
To lower health care cost, cut medical errors, and improve care, we’ll computerize the nation’s health record in five years, saving billions of dollars in health care costs and countless lives. And we’ll protect health insurance for more than 8 million Americans who are in danger of losing their coverage during this economic downturn.
To ensure our children can compete and succeed in this new economy, we’ll renovate and modernize 10,000 schools, building state-of-the-art classrooms, libraries, and labs to improve learning for over five million students. We’ll invest more in Pell Grants to make college affordable for seven million more students, provide a $2,500 college tax credit to four million students, and triple the number of fellowships in science to help spur the next generation of innovation.
Finally, we will rebuild and retrofit America to meet the demands of the 21st century. That means repairing and modernizing thousands of miles of America’s roadways and providing new mass transit options for millions of Americans. It means protecting America by securing 90 major ports and creating a better communications network for local law enforcement and public safety officials in the event of an emergency. And it means expanding broadband access to millions of Americans, so business can compete on a level-playing field, wherever they’re located.
I know that some are skeptical about the size and scale of this recovery plan. I understand that skepticism, which is why this recovery plan must and will include unprecedented measures that will allow the American people to hold my Administration accountable for these results. We won’t just throw money at our problems - we’ll invest in what works. Instead of politicians doling out money behind a veil of secrecy, decisions about where we invest will be made public, and informed by independent experts whenever possible. We’ll launch an unprecedented effort to root out waste, inefficiency, and unnecessary spending in our government, and every American will be able to see how and where we spend taxpayer dollars by going to a new website called recovery.gov.
No one policy or program will solve the challenges we face right now, nor will this crisis recede in a short period of time. But if we act now and act boldly; if we start rewarding hard work and responsibility once more; if we act as citizens and not partisans and begin again the work of remaking America, then I have faith that we will emerge from this trying time even stronger and more prosperous than we were before. Thanks for listening.
[Baca]
January 29, 2009 World Economic Forum / Global Research
Prime Minister Vladimir Putin’s speech at the opening ceremony of the World Economic Forum Davos, Switzerland January 28, 2009
Good afternoon, colleagues, ladies and gentlemen,
I would like to thank the forum’s organisers for this opportunity to share my thoughts on global economic developments and to share our plans and proposals.
The world is now facing the first truly global economic crisis, which is continuing to develop at an unprecedented pace.
The current situation is often compared to the Great Depression of the late 1920s and the early 1930s. True, there are some similarities. However, there are also some basic differences. The crisis has affected everyone at this time of globalisation. Regardless of their political or economic system, all nations have found themselves in the same boat.
There is a certain concept, called the perfect storm, which denotes a situation when Nature’s forces converge in one point of the ocean and increase their destructive potential many times over. It appears that the present-day crisis resembles such a perfect storm.
Responsible and knowledgeable people must prepare for it. Nevertheless, it always flares up unexpectedly.
The current situation is no exception either. Although the crisis was simply hanging in the air, the majority strove to get their share of the pie, be it one dollar or a billion, and did not want to notice the rising wave.
In the last few months, virtually every speech on this subject started with criticism of the United States. But I will do nothing of the kind.
I just want to remind you that, just a year ago, American delegates speaking from this rostrum emphasised the US economy’s fundamental stability and its cloudless prospects. Today, investment banks, the pride of Wall Street, have virtually ceased to exist. In just 12 months, they have posted losses exceeding the profits they made in the last 25 years. This example alone reflects the real situation better than any criticism.
The time for enlightenment has come. We must calmly, and without gloating, assess the root causes of this situation and try to peek into the future.
In our opinion, the crisis was brought about by a combination of several factors.
The existing financial system has failed. Substandard regulation has contributed to the crisis, failing to duly heed tremendous risks. Add to this colossal disproportions that have accumulated over the last few years. This primarily concerns disproportions between the scale of financial operations and the fundamental value of assets, as well as those between the increased burden on international loans and the sources of their collateral.
The entire economic growth system, where one regional centre prints money without respite and consumes material wealth, while another regional centre manufactures inexpensive goods and saves money printed by other governments, has suffered a major setback.
I would like to add that this system has left entire regions, including Europe, on the outskirts of global economic processes and has prevented them from adopting key economic and financial decisions. Moreover, generated prosperity was distributed extremely unevenly among various population strata. This applies to differences between social strata in certain countries, including highly developed ones. And it equally applies to gaps between countries and regions. A considerable share of the world’s population still cannot afford comfortable housing, education and quality health care. Even a global recovery posted in the last few years has failed to radically change this situation. And, finally, this crisis was brought about by excessive expectations. Corporate appetites with regard to constantly growing demand swelled unjustifiably. The race between stock market indices and capitalisation began to overshadow rising labour productivity and real-life corporate effectiveness.
Unfortunately, excessive expectations were not only typical of the business community. They set the pace for rapidly growing personal consumption standards, primarily in the industrial world. We must openly admit that such growth was not backed by a real potential. This amounted to unearned wealth, a loan that will have to be repaid by future generations.
This pyramid of expectations would have collapsed sooner or later. In fact, this is happening right before our eyes.
Esteemed colleagues,
One is sorely tempted to make simple and popular decisions in times of crisis. However, we could face far greater complications if we merely treat the symptoms of the disease.
Naturally, all national governments and business leaders must take resolute actions. Nevertheless, it is important to avoid making decisions, even in such force majeure circumstances, that we will regret in the future.
This is why I would first like to mention specific measures which should be avoided and which will not be implemented by Russia. We must not revert to isolationism and unrestrained economic egotism. The leaders of the world’s largest economies agreed during the November 2008 G20 summit not to create barriers hindering global trade and capital flows. Russia shares these principles. Although additional protectionism will prove inevitable during the crisis, all of us must display a sense of proportion. Excessive intervention in economic activity and blind faith in the state’s omnipotence is another possible mistake. True, the state’s increased role in times of crisis is a natural reaction to market setbacks. Instead of streamlining market mechanisms, some are tempted to expand state economic intervention to the greatest possible extent. The concentration of surplus assets in the hands of the state is a negative aspect of anti-crisis measures in virtually every nation. In the 20th century, the Soviet Union made the state’s role absolute. In the long run, this made the Soviet economy totally uncompetitive. This lesson cost us dearly. I am sure nobody wants to see it repeated. Nor should we turn a blind eye to the fact that the spirit of free enterprise, including the principle of personal responsibility of businesspeople, investors and shareholders for their decisions, is being eroded in the last few months. There is no reason to believe that we can achieve better results by shifting responsibility onto the state. And one more point: anti-crisis measures should not escalate into financial populism and a refusal to implement responsible macroeconomic policies. The unjustified swelling of the budgetary deficit and the accumulation of public debts are just as destructive as adventurous stock-jobbing.
Ladies and gentlemen,
Unfortunately, we have so far failed to comprehend the true scale of the ongoing crisis. But one thing is obvious: the extent of the recession and its scale will largely depend on specific high-precision measures, due to be charted by governments and business communities and on our coordinated and professional efforts. In our opinion, we must first atone for the past and open our cards, so to speak. This means we must assess the real situation and write off all hopeless debts and “bad” assets. True, this will be an extremely painful and unpleasant process. Far from everyone can accept such measures, fearing for their capitalisation, bonuses or reputation. However, we would “conserve” and prolong the crisis, unless we clean up our balance sheets. I believe financial authorities must work out the required mechanism for writing off debts that corresponds to today’s needs. Second. Apart from cleaning up our balance sheets, it is high time we got rid of virtual money, exaggerated reports and dubious ratings. We must not harbour any illusions while assessing the state of the global economy and the real corporate standing, even if such assessments are made by major auditors and analysts.
In effect, our proposal implies that the audit, accounting and ratings system reform must be based on a reversion to the fundamental asset value concept. In other words, assessments of each individual business must be based on its ability to generate added value, rather than on subjective concepts. In our opinion, the economy of the future must become an economy of real values. How to achieve this is not so clear-cut. Let us think about it together.
Third. Excessive dependence on a single reserve currency is dangerous for the global economy. Consequently, it would be sensible to encourage the objective process of creating several strong reserve currencies in the future. It is high time we launched a detailed discussion of methods to facilitate a smooth and irreversible switchover to the new model.
Fourth. Most nations convert their international reserves into foreign currencies and must therefore be convinced that they are reliable. Those issuing reserve and accounting currencies are objectively interested in their use by other states. This highlights mutual interests and interdependence. Consequently, it is important that reserve currency issuers must implement more open monetary policies. Moreover, these nations must pledge to abide by internationally recognised rules of macroeconomic and financial discipline. In our opinion, this demand is not excessive. At the same time, the global financial system is not the only element in need of reforms. We are facing a much broader range of problems. This means that a system based on cooperation between several major centres must replace the obsolete unipolar world concept. We must strengthen the system of global regulators based on international law and a system of multilateral agreements in order to prevent chaos and unpredictability in such a multipolar world. Consequently, it is very important that we reassess the role of leading international organisations and institutions.
I am convinced that we can build a more equitable and efficient global economic system. But it is impossible to create a detailed plan at this event today.
It is clear, however, that every nation must have guaranteed access to vital resources, new technology and development sources. What we need is guarantees that could minimise risks of recurring crises. Naturally, we must continue to discuss all these issues, including at the G20 meeting in London, which will take place in April.
Our decisions should match the present-day situation and heed the requirements of a new post-crisis world.
The global economy could face trite energy-resource shortages and the threat of thwarted future growth while overcoming the crisis. Three years ago, at a summit of the Group of Eight, we raised the issue of global energy security. We called for the shared responsibility of suppliers, consumers and transit countries. I think it is time to launch truly effective mechanisms ensuring such responsibility.
The only way to ensure truly global energy security is to form interdependence, including a swap of assets, without any discrimination or dual standards. It is such interdependence that generates real mutual responsibility.
Unfortunately, the existing Energy Charter has failed to become a working instrument able to regulate emerging problems.
I propose we start laying down a new international legal framework for energy security. Implementation of our initiative could play a political role comparable to the treaty establishing the European Coal and Steel Community. That is to say, consumers and producers would finally be bound into a real single energy partnership based on clear-cut legal foundations.
Every one of us realises that sharp and unpredictable fluctuations of energy prices are a colossal destabilising factor in the global economy. Today’s landslide fall of prices will lead to a growth in the consumption of resources.
On the one hand, investments in energy saving and alternative sources of energy will be curtailed. On the other, less money will be invested in oil production, which will result in its inevitable downturn. Which, in the final analysis, will escalate into another fit of uncontrolled price growth and a new crisis.
It is necessary to return to a balanced price based on an equilibrium between supply and demand, to strip pricing of a speculative element generated by many derivative financial instruments.
To guarantee the transit of energy resources remains a challenge. There are two ways of tackling it, and both must be used. The first is to go over to generally recognised market principles of fixing tariffs on transit services. They can be recorded in international legal documents. The second is to develop and diversify the routes of energy transportation. We have been working long and hard along these lines. In the past few years alone, we have implemented such projects as the Yamal-Europe and Blue Stream gas pipelines. Experience has proved their urgency and relevance. I am convinced that such projects as South Stream and North Stream are equally needed for Europe’s energy security. Their total estimated capacity is something like 85 billion cubic meters of gas a year. Gazprom, together with its partners – Shell, Mitsui and Mitsubishi – will soon launch capacities for liquefying and transporting natural gas produced in the Sakhalin area. And that is also Russia’s contribution to global energy security. We are developing the infrastructure of our oil pipelines. The first section of the Baltic Pipeline System (BPS) has already been completed. BPS-1 supplies up to 75 million tonnes of oil a year. It does this direct to consumers – via our ports on the Baltic Sea. Transit risks are completely eliminated in this way. Work is currently under way to design and build BPS-2 (its throughput capacity is 50 million tonnes of oil a year. We intend to build transport infrastructure in all directions. The first stage of the pipeline system Eastern Siberia – Pacific Ocean is in the final stage. Its terminal point will be a new oil port in Kozmina Bay and an oil refinery in the Vladivostok area. In the future a gas pipeline will be laid parallel to the oil pipeline, towards the Pacific and China. Addressing you here today, I cannot but mention the effects of the global crisis on the Russian economy. We have also been seriously affected.
However, unlike many other countries, we have accumulated large reserves. They expand our possibilities for confidently passing through the period of global instability.
The crisis has made the problems we had more evident. They concern the excessive emphasis on raw materials in exports and the economy in general and a weak financial market. The need to develop a number of fundamental market institutions, above all of a competitive environment, has become more acute.
We were aware of these problems and sought to address them gradually. The crisis is only making us move more actively towards the declared priorities, without changing the strategy itself, which is to effect a qualitative renewal of Russia in the next 10 to 12 years.
Our anti-crisis policy is aimed at supporting domestic demand, providing social guarantees for the population, and creating new jobs. Like many countries, we have reduced production taxes, leaving money in the economy. We have optimised state spending.
But, I repeat, along with measures of prompt response, we are also working to create a platform for post-crisis development.
We are convinced that those who will create attractive conditions for global investment already now and will be able to preserve and strengthen sources of strategically meaningful resources will become leaders of the restoration of the global economy.
This is why among our priorities we have the creation of a favourable business environment and development of competition; the establishment of a stable loan system resting on sufficient internal resources; and implementation of transport and other infrastructure projects.
Russia is already one of the major exporters of a number of food commodities. And our contribution to ensuring global food security will only increase.
We are also going to actively develop the innovation sectors of the economy. Above all, those in which Russia has a competitive edge – space, nuclear energy, aviation. In these areas, we are already actively establishing cooperative ties with other countries. A promising area for joint efforts could be the sphere of energy saving.
We see higher energy efficiency as one of the key factors for energy security and future development.
We will continue reforms in our energy industry. Adoption of a new system of internal pricing based on economically justified tariffs.
This is important, including for encouraging energy saving. We will continue our policy of openness to foreign investments.
I believe that the 21st century economy is an economy of people not of factories. The intellectual factor has become increasingly important in the economy. That is why we are planning to focus on providing additional opportunities for people to realise their potential.
We are already a highly educated nation. But we need for Russian citizens to obtain the highest quality and most up-to-date education, and such professional skills that will be widely in demand in today’s world. Therefore, we will be pro-active in promoting educational programmes in leading specialities.
We will expand student exchange programmes, arrange training for our students at the leading foreign colleges and universities and with the most advanced companies. We will also create such conditions that the best researchers and professors – regardless of their citizenship – will want to come and work in Russia.
History has given Russia a unique chance. Events urgently require that we reorganise our economy and update our social sphere. We do not intend to pass up this chance. Our country must emerge from the crisis renewed, stronger and more competitive.
Separately, I would like to comment on problems that go beyond the purely economic agenda, but nevertheless are very topical in present-day conditions. Unfortunately, we are increasingly hearing the argument that the build-up of military spending could solve today’s social and economic problems. The logic is simple enough. Additional military allocations create new jobs. At a glance, this sounds like a good way of fighting the crisis and unemployment. This policy might even be quite effective in the short term. But in the longer run, militarisation won’t solve the problem but will rather quell it temporarily. What it will do is squeeze huge financial and other resources from the economy instead of finding better and wiser uses for them.
My conviction is that reasonable restraint in military spending, especially coupled with efforts to enhance global stability and security, will certainly bring significant economic dividends. I hope that this viewpoint will eventually dominate globally. On our part, we are geared to intensive work on discussing further disarmament.
I would like to draw your attention to the fact that the economic crisis could aggravate the current negative trends in global politics. The world has lately come to face an unheard-of surge of violence and other aggressive actions, such as Georgia’s adventurous sortie in the Caucasus, recent terrorist attacks in India, and escalation of violence in Gaza Strip. Although not apparently linked directly, these developments still have common features.
First of all, I am referring to the existing international organisations’ inability to provide any constructive solutions to regional conflicts, or any effective proposals for interethnic and interstate settlement. Multilateral political mechanisms have proved as ineffective as global financial and economic regulators. Frankly speaking, we all know that provoking military and political instability, regional and other conflicts is a helpful means of distracting the public from growing social and economic problems. Such attempts cannot be ruled out, unfortunately.
To prevent this scenario, we need to improve the system of international relations, making it more effective, safe and stable. There are a lot of important issues on the global agenda in which most countries have shared interests. These include anti-crisis policies, joint efforts to reform international financial institutions, to improve regulatory mechanisms, ensure energy security and mitigate the global food crisis, which is an extremely pressing issue today.
Russia is willing to contribute to dealing with international priority issues. We expect all our partners in Europe, Asia and America, including the new US administration, to show interest in further constructive cooperation in dealing with all these issues and more. We wish the new team success.
Ladies and gentlemen,
The international community is facing a host of extremely complicated problems, which might seem overpowering at times. But, a journey of thousand miles begins with a single step, as the proverb goes. We must seek foothold relying on the moral values that have ensured the progress of our civilisation. Integrity and hard work, responsibility and self-confidence will eventually lead us to success. We should not despair. This crisis can and must be fought, also by pooling our intellectual, moral and material resources.
This kind of consolidation of effort is impossible without mutual trust, not only between business operators, but primarily between nations.
Therefore, finding this mutual trust is a key goal we should concentrate on now.
Trust and solidarity are key to overcoming the current problems and avoiding more shocks, to reaching prosperity and welfare in this new century.
Thank you.
[Baca]
January 28, 2009 www.investorwalk.com
Value at risk (VaR) financial models are the latest game being played by those on Wall Street who profess to manage risk, a troubling trend detailed superbly by Joe Nocera in a January 2nd New York Times Magazine article, They give bankers a false sense of confidence in their risk control while, in reality, they increase the level of risk for society as a whole.
But Nocera understates the problem. The risk management groups on Wall Street are actually engaging in risk manipulation, risk distortion, and risk amplification - anything but risk management.
Public perception is that Wall Street didn't do much risk management over the past decade, or perhaps longer, resulting in the profound credit crisis that wiped out many financial firms and left others precariously hanging on. But the problem is not that Wall Street didn't have people monitoring risk. Almost every firm hired scores of risk managers during the last several years, with some being paid millions of dollars a year. The problem was that the more people they hired and the more VaR financial models they ran, the worse their understanding and assessment of risk became.
Why so? There are two main reasons. First, the structure of VaR models is not based in reality. They place too much faith in the fantasy of mathematical algorithms to explain the behavior of human beings. They assume human behavior can be modeled as accurately as launching a rocket - that we can predict its path and outcome 100% correctly. It's no coincidence risk managers are often called rocket scientists - they treat people like physical objects. Is human behavior really that predictable? Are risk managers so crazy as to think human beings behave like a mindless, computer predefined rocket? Does human behavior obey math principles or is it the other way around?
Most financial models rely on theories of probability and statistics. In modern physics, quantum mechanics relies heavily on statistics as a way to explain cause and effect. But the financial world is no science experiment; everything is for real. You can never go back to do it "right" and repeat an "experiment." Things might work one time but may not work the next time. When a physics-like approach is applied to financial products whose value is heavily tied to human actions, like mortgage prepayments, it becomes a computer game of garbage in and garbage out.
Or worse, it becomes a self-fulfilling prophecy. As risk managers used financial models to come up with VaR for toxic products, iterating to arrive at what they believed were successively more accurate estimates, they developed a false sense that they were actually in control. They believed they could accurately predict every possible cash flow scenario for a mortgage-backed security, as well as its probability distribution. The CDOs and the credit default swaps created through this process embedded a level of overconfidence which killed the whole industry. You can always fool many people for a long time, especially when you become a fool yourself.
For a time the VaR model seemed to "work," but it failed exactly when it was needed the most. As hedge fund manager David Einhorn said in Nocera's article, VaR is "relatively useless as a risk-management tool and potentially catastrophic." Why so? Because we will never be able to understand and assess the true nature of supposedly rare catastrophic events. Statistically this is the "fat tail," an event which happens a lot more often than we perceive and put into VaR models. Second, when it happens, its consequences are catastrophic, potentially putting everyone out of business. Computer models cannot handle this kind of discontinuity, which is a little like a number divided by zero. As Nicolas Nassim Taleb said in the article, "In the real world, the magnitude of errors is much less known." If you don't know the true probability and potential damage, you might as well throw the whole VaR model into the garbage. To instead use it to manage risk is absurd.
But it is worse than Nocera described. The second reason for the failure of risk management is that financial models were all based on assumptions. It was too easy to twist a few of them to produce the desired outcome. Risk managers felt they were infallible, to the point of feeling like Gods. They justified any rating for their CDOs or predicted any MBS default probability and payment schedule they wanted. If too much risk was calculated by the model, no problem, they just twisted a few assumptions in the Monte-Carlo simulation of the VaR model and then re-ran it. Suddenly the distribution graph showed the exact curve they needed. This transformed a game of false but honest assumptions into much more insidious risk cover-up.
Most of the time common sense dictates whether you are adding or reducing risk, without even running any models. For example, when a former high level executive of Citigroup pushed the firm to get into the exotic derivative areas of MBS, CDOs and CDSs, even naïve observers knew Citigroup was adding risk to its portfolio. But by using some "magic" financial models, the risk management group and their "renowned" consultants were able to show the Board of Directors that Citigroup was not taking any more additional risk and, even if it was, it could be diversified away through their global supermarket portfolio. Risk managers twisted the model to produce the desired future outcome, and they used financial models to justify a huge amount of risk that has since wiped out their shareholder value many times over. In another example, after AIG repeatedly assured investors there was no risk at all from their CDS portfolio, with a risk model to back up their counterintuitive assertion, a very small financial product group ultimately wiped out the financial conglomerate.
The seductive elegance, overconfidence and abuse inherent in financial modeling are at least part of the reason for the current credit crisis. The more risk managers hired on Wall Street in the years running up to the crisis, the riskier the firm proved to be. Just look at Citigroup. How many of its employees and consultants have been, and are still, doing risk management one way or another? When top management relentlessly pursues quick profits by taking on more risk, risk managers become puppies. Eager to please their managers, they use their expertise to cover up risk rather than expose it. Computer models become their prime weapon.
Outside of risk management, financial modeling is also heavily used in portfolio return analysis and forecasting. For most of the last ten years of the Greenspan era, a big myth - or "theory" - was that low cost of capital (which Greenspan achieved by relentlessly driving down interest rates) would lead to improved return on equity (ROE). Many people used financial models to justify or "predict" a value for the Dow of 36,000 or even 100,000, a so-called paradigm shift of ROE. Suddenly companies got all the free capital they wanted, leveraging their ROE (ROE is a leveraged factor in the capital structure). The sky was the limit for the return to shareholders and for their stock prices. And it was supposed to go on forever. No longer human beings living on Earth, investors became in their own minds powerful angels who could do no wrong, led by the maestro Greenspan. When too many people (and their computer models) told the same lie, the lie itself became the truth. How could Greenspan and so many other very smart people suddenly forget the very basic economic rule that low cost of capital will eventually lead to zero return on equity? That is a fundamental principle of capitalism.
Another myth of the last decade was that using financial models in dynamic asset allocations could improve performance. The Yale and Harvard endowment funds used dynamic asset allocation to invest in private equities, hedge funds, real estate and timber. Other endowments followed their lead to "diversify" and "rebalance" their portfolio whenever dictated by their computer models. But they failed to realize that most of those assets are illiquid, and when everyone is dumping them at the same time, it is a downward spiral or worse, and there may be no way out. Computers are notoriously bad at modeling liquidity. This was a critical lesson of the program trading and dynamic hedging that caused the 1987 Black Monday market crash. As Jeremy Grantham of GMO has said, in the long run, human beings learn nothing from history, and 1987 is just two decades ago.
In a certain sense, the liquidity crisis of the last six months was inevitable. Wall Street got complacent with computer models, and nature came back to punish them (and the rest of us) for shrugging off the resistance to modeling of a key factor: liquidity. Computer models depend on the assumption of a continuous market, with a balanced equilibrium between buyers and sellers. A situation where all the liquidity is sucked out of the market destroys the value of all those exotic paper products. We do not need a bunch of highly paid math geeks to run millions of Monte-Carlo simulations to tell us that. A computer can never replace common sense.
Now we have another Fed Chairman who only knows how to print more money, then print some more, and expand the Fed's balance sheet ever-wider. Bernanke drops the money at only one location, Wall Street. Being an economist and renowned monetarist, he must know that excessive printing will eventually lead to zero value of the fiat currency, the US dollar, just as low cost of capital eventually leads to zero ROE. If that is the inevitable outcome, the government should drop money to the middle class and the poor, not the super-rich bankers on Wall Street. Since ten times zero is still zero, what difference does it make? In addition to being a politically popular move, this might even avoid a few incidents of social unrest.
So-called "extreme" events with "low" probability happen more often than people perceive in risk management. When they occur, an unforeseen tsunami of incalculable magnitude results, destroying wealth on a scale from which it may take a generation or two for the economy to fully recover. Meanwhile, you can pretty much throw risk management models out the window. It does more harm than good.
[Baca]
January 26, 2009
"Mr. President: Give Us a Clean Break from War"
In a message to President Obama today, former Congresswoman Cynthia McKinney wrote:
"It is time that the United States negotiate in good faith with Hamas, the legitimate representative of the Palestinian people. It is also time that the U.S. government tell Israel to release the Hamas Parliamentarians it illegally arrested. President Obama, please say something about Gaza. You have been roundly condemned for your continued silence in the face of war crimes and crimes against humanity committed by Israel in Gaza. Silence is complicity. Not one more bomb for Israel."
Israeli action in Gaza has outraged the world. Starting with Israel's inhumane blockade of Gaza when it didn't like the 2006 election results that put Hamas officially into power. In September 2007, Israel declared Gaza an "enemy entity." Of course, Israeli efforts to isolate the Gaza Strip can be traced back to Ariel Sharon as early as 2005. In carrying out its military Operation Cast Lead, Israel not only committed war crimes and crimes against humanity, it also carried out a long-standing goal of Gaza isolation. The President's continued silence on Gaza and the Palestinian right of self-determination is unacceptable.
I would like to commend President Obama for recognizing that peace is the imperative and that the United States can play a constructive role in its attainment. However, placing a phone call to an irrelevant "leader" in an attempt to revive his political standing is not a route to peace: it is a journey down the same road that we're already on, that is massacres, genocide, war crimes, crimes against humanity, torture--all with U.S. weapons, paid for by U.S. taxpayers.
The President must call the elected representatives of the Palestinian people and that means dealing with Hamas.
President Obama has already spoken with Israeli Prime Minister Ehud Olmert. George Mitchell, the President's Middle East Envoy, is reportedly scheduled to visit the region, but is expected to meet only with Egyptian, Israeli, Saudi, and Jordanian leaders, and the West Bank's Abbas. Unfortunately, despite worldwide revulsion and United Nations outrage at Israeli actions in Gaza, Gaza has not been reported to be one of the Presidential Envoy's destinations.
Even worse, one of the first officials that Obama called on his first day in office was Palestinian Mahmood Abbas. Abbas, however, is no longer President, heading a government that has no opportunity to govern, from a state that exists only as a construct not made by the Palestinian people. For the United States to embark upon the path of peace, it must recognize and act on the fact that Mahmood Abbas is now irrelevant.
I believe that the call to Abbas occurred because of pressure on President Obama from outraged activists around the country and around the world calling for him to do something. But Abbas is irrelevant if the goal is peace.
If the goal, however, is to appear to be doing something while all the time doing nothing but allowing the violence of U.S.-sponsored military action to spread including saber rattling against Syria and Iran, then the President is on the right path.
The American people voted for change and peace. President Obama's current path will produce neither.
I have implored President Obama to say something about Gaza. He has been roundly condemned for his continued silence in the face of war crimes and crimes against humanity committed by Israel in Gaza. Silence in the face of such criminal behavior is complicity.
President Obama must urgently place a call to the elected government of the Palestinian people.
President Obama can send a strong message to the warmongers inside his own party and present them "a clean break" from war. I encourage him to do so. We will not be fooled by actions that have the appearance of putting us on a path for peace, but that are public relations projects that buy time for more war.
To activists and human rights lawyers around the world I say: Now is not the time to let up. We must be unrelenting in our pressure for justice and recognition of the rights of all peoples embodied in the Universal Declaration of Human Rights. Those rights include the right not to be occupied. And the right to resist occupation. This is the embodiment of self-determination. And the Palestinian people are holders of these rights.
It is time that the United States negotiate in good faith with Hamas, because it is the legitimate representative of the Palestinian people. It is also time that the U.S. government tell Israel to release the Hamas Parliamentarians it illegally arrested.
While the United States Government spends precious resources to imprison Palestinians in the United States who attempted to ameliorate the humanitarian disaster in Gaza, I will attempt another trip to Gaza to assess the depth of the worsened humanitarian catastrophe now there.
I have repeatedly called on the President to ask for and the Congress to vote not one more bomb, not one more dime for the Israeli war machine.
[Baca]
Comptroller of the Currency Administrator of National Banks
Saturday, 31 January 2009 18:00
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[Baca]
26 January 2009, www.greatconservatives.com
Those who have visited Michigan recently or the Mahoning Valley of Ohio in the 1980s can recognize the symptoms of a rust belt. A hitherto prosperous industry, paying high wages to its employees, has been overtaken by market changes and is forced into harsh downsizing or even bankruptcy. As a result, the lives of many inhabitants degenerate into alcoholism, home foreclosures and welfare.
This time around, the decaying industry is finance, and the rust belt cities are London and New York.
The parallels with the U.S. automobile industry are closer than they look. In the early years of the auto industry, it included both large companies and small specialty manufacturers, the latter being remembered now as producers of “vintage” cars of very high quality. Then the Great Depression wiped out most of the specialty producers, which could not compete with the mass producers’ costs. For the next several decades, the business was dominated by a heavily-capitalized oligopoly with extremely highly paid employees, quite high profitability but deteriorating product quality. Finally, it became clear that the oligopoly was uncompetitive and the industry began to shed workers and close plants.
In finance, the early specialty producers were the London merchant banks; for Duisenberg, Packard and Stutz you can substitute Hambros, Warburgs and Hill Samuel. They, too, had superb product quality and are remembered with great fondness by their former customers, but were driven out of the business by heavily capitalized competitors, in this case running behemoth high-risk trading desks rather than mass production assembly-line factories. The employees of the well-capitalized behemoths were even better paid than the UAW work force in the 1950s. Then gradually product quality began to deteriorate, and bad practices such as “liar loan” securitized mortgages, accounting “mark-ups” of assets that had not been sold and self-deluding risk management crept in.
The main difference between the two cases is that the collapse of the finance sector has taken the form of a sudden Gotterdammerung rather than the steady but inexorable decline characteristic of the U.S. automobile industry. The bottom line is the same: Detroit needs to downsize radically, but so does Wall Street.
As I have written previously, in and after the 1980s, the central activity of the financial sector became not service but rent-seeking. Finance doubled its share of Gross Domestic Product (GDP) in the 30 years to 2006, but very little of the addition represented products and services that provided true value to the economy as a whole. Securitization was mostly a complex and expensive means of getting assets off banks’ balance sheets. Derivatives helped manage risks, but only a tiny percentage of the multitrillion dollar outstandings in the derivatives markets represented risk amelioration; the rest was just trading noise or outright speculation. Hedge funds and private equity funds were mostly a means of multiplying excessively the fees charged for investment management; they almost drove out of business the true venture capital funds, which had a genuine economic value. Principal trading, the most exciting activity of all in the glory years for greedy investment bank partners, was simply a means of using large amounts of outside shareholders’ capital to trade on insider information about the market’s deal flow. All of these activities were legal; none of them added value to anybody but their immediate practitioners, while they represented additional costs and lower returns for everybody else. In other words, they fulfilled the dictionary definition of rent seeking.
Given the aggression, greed and high intelligence of the average investment banker, rent seeking can never be eliminated completely. Nevertheless, the conditions that made it flourish have already changed, and good policy will ensure that they do not recur in the future. In particular:
• Financial complexity is mostly an additional source of risk, and provides little or no added value to the economy as a whole. A Madoff-style Ponzi scheme could only grow to the monstrous size it did in an environment in which even institutional investors were ignorant and incurious about the way in which their investment returns were derived.
• More than a decade of easy money after 1995 increased asset prices, thereby providing returns to those who bought assets on a leveraged basis, while making leverage itself very easy to obtain.
• The move from thinly capitalized “Duisenberg” investment/merchant banks, providing advice to companies and arranging their financing to behemoth “General Motors” financial conglomerates taking principal positions in the securities of companies they advised produced an immense interconnecting web of conflicts of interest and insider trading opportunities.
• Risk management methodologies, which achieved acceptance so great that under the Basel II regulations “sophisticated” banks were allowed to select their own, were fundamentally flawed. They rested on an academic theory of efficient markets that in practice is easily disprovable and represents a very poor approximation to reality. The prolonged period of easy money and bullish markets appeared to validate them; we now know better.
• Remuneration practices in the industry became far more generous than their historical norms, more also than that necessary to attract staff of the right intellectual caliber and other qualities. This was a product of the almost uninterrupted bull market in bonds and stocks from 1982 to 2007, a large part of the returns from which was scooped off by financial sector employees who added far less value than they extracted.
If rent seeking is to a large extent eliminated, it is likely that the financial services sector will approximately halve in size, returning to around its 1970s share of GDP. Its usage of capital will decline only modestly, since the excessive leverage built up in the last decade will need to be corrected. Conversely, the sector’s human resource usage needs to decline by much more than half – after all, we have a multitude of tools today that allow the relatively simple functions of traditional finance to be performed much more efficiently, and with less human input. In addition, with modern telecommunications technology, many of the routine tasks of finance (including almost all the non-mechanizable parts of the back office, but also much research and document preparation) can be performed by well-educated but lower-paid employees in India or elsewhere. Thus, while the sector’s overall value added will halve, the portion of value added attributable to capital will significantly increase, that attributable to labor will decline.
For the financial practitioners of New York and London, the future is thus bleak. Rewards will be greatly reduced, as the market operates ferociously both on the income side and the employee costs side of their employers. Headcount will also be greatly reduced, as functions are eliminated, work is outsourced to the Third World and the weaker entities go bankrupt or are merged into competitors. The decline in practitioners’ incomes might be as much as 80%, even after a modest market recovery, though the number of practitioners should reduce by only 50% to 60%.
That also promises a weak future for the local beneficiaries from financial services incomes in New York or London. Such losers would include local housing markets and those of the smarter resorts, together with the army of real estate agents, decorators, construction companies and lawyers that have benefited so egregiously during the bubble. It would also include local restaurants, clothing retailers, jewelers and other high-end products and services. The tourism business will find far fewer takers for the kind of “short break” luxury sybaritic packages in which it has recently specialized. Thus the short-term knock-on effect on the overall economy of poorer bankers will be severe, even though the long-term economic benefits of eliminating the dead-weight costs of the bloated banking community will be even greater.
The two centers most adversely affected by these changes will be London and New York. Asian financial centers will continue to benefit from the faster regional rates of overall economic growth, while as in the 1980s, the problems of Dubai will spread far beyond finance.
In New York, the “rust belt” effect will be severe but not overwhelming – it will be 1970s Cleveland rather than 1980s Youngstown. Many of the skyscrapers of the financial district and the luxury residential areas will become ghost buildings, as their predecessor buildings did in the 1930s, but they are unlikely to descend to the chain-round-the facility-guarded-by-a-Rottweiler-and-a-tattooed-thug state symptomatic of the worst industrial blight.
However, the resemblance to 1970s Cleveland (which defaulted in 1978) will probably be increased by a municipal bankruptcy. Mayor Michael Bloomberg has pursued the policy of former New York Mayor (1965-73) John Lindsay. He has increased municipal spending by 52% over six years while prices rose 20%, and has relied on hefty increases in property taxes to fund the increase. Those funding sources have disappeared, but we are still only at the stage of cosmetic cuts and financing gimmicks. As the downturn continues, New York’s fiscal state will become rapidly worse, and default is inevitable in a year or two. Bloomberg has altered the rules to allow himself to run for mayor again this November; he would be mad to do so, since the fiscal deterioration would make his third term a very unpleasant experience.
London will be the Youngstown of this downturn, an excellent market for Rottweilers, wire mesh and tattooed thugs. Docklands in particular will revert to its 1970s squalor, albeit with some very expensive buildings scattered around. Few of the financial institutions that have prospered so lavishly in the London of the past couple of decades are British owned, and those that are were excessively involved in the British mortgage market – an even bigger disaster than the U.S. market because home values were even more outrageous at the peak. Given that the financial sector will be downsizing anyway, will top management in Frankfurt, New York or Tokyo want to keep its stable of expensive London whiz-kids, in order to continue participating in a market that was never central to their overall strategy and is now unprofitable? I doubt it. Even the Russian mafia may leave, though probably to Cyprus rather than Moscow. Whereas New York’s downturn may produce municipal bankruptcy, London’s downturn has a fair chance of producing national bankruptcy. Going forward, British youth will have to find a new way to make a living – single-malt Scotch and tourism cannot support a nation of 60 million people.
Inhabitants of London and New York have spent the last couple of decades sneering at their provincial cousins, particularly those involved in the grubby world of manufacturing. Now the Rust Belt has reached them also.
Martin Hutchinson is the author of "Great Conservatives" (Academica Press, 2005). Details can be found on the Web site www.greatconservatives.com
[Baca]
26 January 2009, Mises Institute
Lately the Mises Daily may have given the impression that we just bash Paul Krugman. In the interest of balance, today I will cast aspersions on another Nobel laureate, the Chicago School economist Robert Lucas. As is typical among many "promarket" economists, the undeniably sharp Lucas inexplicably sees no problem with government price fixing when it comes to interest rates.
In his recent Wall Street Journal op-ed, Lucas writes,
The Federal Reserve's lowering of interest rates last Tuesday was welcome, but it was also received with skepticism. Once the federal-funds rate is reduced to zero, or near zero, doesn't this mean that monetary policy has gone as far as it can go? This widely held view was appealed to in the 1930s to rationalize the Fed's passive role as the U.S. economy slid into deep depression.
The present article is hardly the place to go into the debate over the Great Depression, but suffice it to say, Herbert Hoover's (and then FDR's) very conscious efforts to "maintain purchasing power" by preventing wage cuts was one major factor in turning the stock-market crash into a decade-long slump. (The fact that Hoover slapped on major tariff and income tax hikes didn't help, either.)
Lucas's view — namely, that the 1929 downturn would have been a run-of-the-mill depression, but the Fed's timidity turned it into the Great one — was popularized by Milton Friedman. It resonates well with free-market types, because after all, it blames the Depression not on laissez-faire capitalism, but instead on regulatory blunders.
However, as Matt Machaj argued in a previous Mises Daily, such rhetoric is difficult for a proponent of truly market-based money and banking to accept. Is it really government "intervention" if the Fed refrains from flooding the economy with more paper money?
Let me put it this way: if Lucas is right, and the Fed's "passive role" helps explain the genesis of the Great Depression, then what about all the little-d depressions that occurred in US history before the Fed was founded in 1913? Was the Fed even more passive in the 1930s than during its nonexistence the previous century?
But let us return to Lucas's article:
Fed Chairman Ben Bernanke's statement last Tuesday made it clear that he does not share this view and intends to continue to take actions to stimulate spending.
There should be no mystery about what he has in mind. Over the past four months the Fed has put more than $600 billion of new reserves into the private sector, using them to discount — lend against — a wide variety of securities held by a variety of financial institutions….
This action has been the boldest exercise of the Fed's lender-of-last-resort function in the history of the Federal Reserve System. Mr. Bernanke said that he is prepared to continue or expand this discounting activity as long as the situation dictates.
Before analyzing this statement, let's make sure we see just how bold this Fed exercise has been. Below is a chart of total bank borrowings from the Fed, from 1919 to the present. (If you squint your eyes, you can see the slight uptick to which Lucas refers.)
Now people have rightly focused on the dangers such a massive infusion poses to the strength of the dollar. These fears are entirely justified. But I want to focus on the political aspects of the recent Fed behavior.
Let us parse Lucas's description: the infusion of some $600 billion in just a few months has come from Fed loans to banks, based upon collateral that no one in the market would accept at face value (literally). Lucas himself says,
Could the $600 billion in new reserves be called a bailout? In a sense, yes: The Fed is lending on terms that private banks are not willing to offer. They are not searching for underpriced "bargains" on behalf of the public, nor is it their mission to do so. Their mission is to provide liquidity to the system by acting as lender-of-last-resort. We don't care about the quality of the assets the Fed acquires in doing this. We care about the quantity of its liabilities.
What's this "we," Ke-mo Sah-bee? It is amazing how flippant Lucas is concerning these new developments. He can barely bring himself to admit that a $600 billion infusion of new money — which no private investor would be foolish enough to make — constitutes a bailout. Moreover, Bernanke's pledge to continue this pattern as "long as the situation dictates" sounds an awful lot like a blank check.
Lucas's touching innocence is illustrated even more so with his endorsement of Bernanke's policy:
It entails no new government enterprises, no government equity positions in private enterprises, no price fixing or other controls on the operation of individual businesses, and no government role in the allocation of capital across different activities.
That last phrase in particular amused me. I confess I didn't actually try this, but I'm betting that if I emailed Mr. Bernanke and explained that my business was desperate for liquidity, he would inform me that I wasn't eligible for any of his generous loans.
I am not accusing Ben Bernanke of being anything more than a misguided academic. I believe his policies have been terrible during this crisis, but I am willing to attribute them to intellectual error. Be that as it may, he has opened Pandora's box. The precedent is now set for the Federal Reserve to make injections of hundreds of billions of dollars as it sees fit. In October, Barney Frank suddenly realized the awesome power that the Fed has held all of these years, according to this account:
"He [Bernanke] can make any loan he wants under any terms to any entity or individual in America that he thinks is economically justified. I asked the chairman if he had $85 billion to bestow in this way. He said, 'I have $800 billion.'"
Clearly unnerved after his exchange with Fed Chairman Ben Bernanke, Massachusetts Congressman Barney Frank, the chairman of the House Financial Services Committee, concluded that no one should have that kind of money to dispense as he sees fit.
Unfortunately, this realization will not lead to a return of the gold standard or (better yet) a complete return of money and banking to the market.
Rather, what will surely happen is that Congress will move to bring the Fed more closely under its control:
"He can't debase the currency at will! That's our job!"
The next few years are going to be very interesting. It is clichéd to say such things, but our country truly is moving through a revolutionary period. But I liked the Beatles song a lot better than Paulson and Bernanke's rendition.
[Baca]
RIYADH
— Sitting a few time zones away from the Davos gathering, former
Malaysian Prime Minister Mahathir Mohamad spares a dry chuckle at the
fall of the once mighty Western financial giants and masters of the
universe.
“They were doing everything that [multilateral agencies]
were counseling developing countries not to do to stay out of crisis,”
he said about the parade of Western banks that have crumbled over the
last six years due to heavy leveraging and bad assets. “They were
greedy … and now people are having a big laugh.”
Malaysia’s elder
statesman has delivered real zingers to the assembled luminaries at
Davos conferences past, notably the view during the 2003 get together
that the Bush administration was responsible for starting World War III.
This
year, Mr. Mahathir isn’t attending Davos. But that hasn’t kept him from
delivering a sermon from afar on one of his well-tread topics: cracks
in the foundation of the Western-dominated international financial
system need to be urgently fixed.
Mr. Mahathir has worked on for
years lobbying to increase the weight of the developing world needs in
international settings. And he had a stark message to the G-8 central
banks and multilateral agencies, including the International Monetary
Fund, which dictated terms of the economic bailout packages to Asian
nations during the economic crisis there 10 years ago: those so-called
financial wizards should have following their own prescription for
economic health.
“They told us … there was a bubble [in asset and
currency prices]. They told us not to increase borrowing. They told us
to cut back government spending. Its advice they ignored in [their] own
economies,” he said to an appreciative audience of Arab businessmen who
have their own gripes about what they see as American and European
hypocrisy, especially when it comes to foreign policy in the Middle
East.
Mr. Mahathir counseled his listeners to heed Asian values over
Western values as governments in the Middle East work to keep their
growth rates positive.
“Our values are similar. Asia values the
country over the individual. In the West, their capitalism is
structured … so that there is always one winner and always one loser,”
he said. “The system in the West has many holes. It is painfully
obvious now.” - Meg cooker
[Baca]
The mere monitoring of bloody conflict assumes precedence over human suffering
Saturday, 31 January 2009
I wonder if we are "normalising" war. It's not just that Israel has
yet again got away with the killing of hundreds of children in Gaza.
And after its own foreign minister said that Israel's army had been allowed to "go
wild" there, it seems to bear out my own contention that the Israeli "Defence
Force" is as much a rabble as all the other armies in the region. But
we seem to have lost the sense of immorality that should accompany conflict
and violence. The BBC's refusal to handle an advertisement for Palestinian
aid was highly instructive. It was the BBC's "impartiality" that
might be called into question. In other words, the protection of an
institution was more important than the lives of children. War was a
spectator sport whose careful monitoring – rather like a football match,
even though the Middle East is a bloody tragedy – assumed precedence over
human suffering.
I'm not sure where all this started. No one doubts that the Second World War
was a bloodbath of titanic proportions, but after that conflict we put in
place all kinds of laws to protect human beings. The International Red Cross
protocols, the United Nations – along with the all-powerful Security Council
and the much ridiculed General Assembly – and the European Union were
created to end large-scale conflict. And yes, I know there was Korea (under
a UN flag!) and then there was Vietnam, but after the US withdrawal from
Saigon, there was a sense that "we" didn't do wars any more.
Foreigners could commit atrocities en masse – Cambodia comes to mind – but
we superior Westerners were exempt. We didn't behave like that.
Low-intensity warfare in Northern Ireland, perhaps. And the Israeli-Arab
conflict would grind away. But there was a feeling that My Lai had been put
behind us. Civilians were once again sacred in the West.
I'm not sure when the change came. Was it Israel's disastrous invasion of
Lebanon in 1982 and the Sabra and Chatila massacre by Israel's allies of
1,700 Palestinian civilians? (Gaza just missed that record.) Israel claimed
(as usual) to be fighting "our" "war against terror" but
the Israeli army is not what it's cracked up to be and massacres (Qana comes
to mind in 1996 and the children of Marwahine in 2006) seem to come attached
to it. And of course, there's the little matter of the Iran-Iraq war between
1980 and 1988 which we enthusiastically supported with weapons to both
sides, and the Syrian slaughter of thousands of civilians at Hama and...
No, I rather think it was the 1991 Gulf War. Our television lads and lasses
played it for all it was worth – it was the first war that had "theme"
music to go with the pictures – and when US troops simply smothered alive
thousands of Iraqi troops in their trenches, we learned about it later and
didn't care much, and even when the Americans ignored Red Cross rules to
mark mass graves, they got away with it. There were women in some of these
graves – I saw British soldiers burying them. And I remember driving up to
Mutla ridge to show a Red Cross delegate where I had seen a mass grave dug
by the Americans, and he looked at the plastic poppy an American had
presumably left there and said: "Something has happened."
He meant that something had happened to international law, to the rules of
war. They had been flouted. Then came Kosovo – where our dear Lord Blair
first exercised his talents for warmaking – and another ream of slaughter.
Of course, Milosevic was the bad guy (even though most of the Kosovars were
still in their homes when the war began – their return home after their
brutal expulsion by the Serbs then became the war aim). But here again, we
broke some extra rules and got away with it. Remember the passenger train we
bombed on the Surdulica bridge – and the famous speeding up of the film by
Jamie Shea to show that the bomber had no time to hold his fire? (Actually,
the pilot came back for another bombing run on the train when it was already
burning, but that was excluded from the film.) Then the attack on the
Belgrade radio station. And the civilian roads. Then the attack on a large
country hospital. "Military target," said Jamie. And he was right.
There were soldiers hiding in the hospital along with the patients. The
soldiers all survived. The patients all died.
Then there was Afghanistan and all that "collateral damage" and
whole villages wiped out and then there was Iraq in 2003 and the tens of
thousands – or half a million or a million – Iraqi civilians killed. Once
more, at the very start, we were back to our old tricks, bombing bridges and
radio stations and at least one civilian estate in Baghdad where "we"
believed Saddam was hiding. We knew it was packed with civilians
(Christians, by chance) but the Americans called it a "high risk"
operation – meaning that they risked not hitting Saddam – and 22 civilians
were killed. I saw the last body, that of a baby, dug from the rubble.
And we don't seem to care. We fight in Iraq and now we're going back to fight
in Afghanistan again and all the human rights and protections appear to have
vanished once more. We will destroy villages and we will find that the
Afghans hate us and we will form more criminal militias – as we did in Iraq
– to fight for us. The Israelis organised a similar militia in their
occupation zone in southern Lebanon, run by a crackpot Lebanese army major.
But now their own troops "go wild". And the BBC is worried about
its "impartiality"?
[Baca]
Many people have asked me whether I have heard that Badawi has indicated that he would not retire as Prime Minister of Malaysia as agreed, when Najib takes over as President of UMNO in March 2009.
My reaction has always been that Badawi cannot be trusted as he has done so many flip-flops before.
Badawi is first and foremost a politician and his Muslim faith would not be a hindrance should he decide to do another flip-flop.
However, my Muslim friends tell me that it is inconceivable that as a Muslim leader, Badawi would dare commit such an irresponsible flip-flop! They are adamant that it would be an insult and a betrayal of all the Muslims in Malaysia for Badawi to renege on his public commitment to ensure a smooth handover to his hand-picked successor in March 2009!
But the rumours continued unabated.
There is now an interesting twist to the rumours. Pakatan Rakyat through its unofficial mouthpiece Malaysia Today has been conducting a so-called opinion poll to determine whether Badawi should in fact hand over power to Najib.
Why conduct such a poll if there is no substance to the rumours? There are opinion polls and opinion polls and many such polls can be manipulated to fit a desired result. It was thought by some political analysts that such an opinion poll conducted by the opposition would lend some credibility to the findings.
It is no secret that the opposition leaders have more than once expressed the wish that Badawi stay on as Prime Minister, not because they genuinely desire his leadership but with the inept Badawi in charge of the Barisan Nasional, they surmised that it would be a cake walk for the Opposition in the next General Elections. Other vested interests have their reasons for wanting Badawi to remain as Prime Minister, if only for their own survival.
It is also apparent that such an opinion poll conducted by the Opposition serves another purpose – to ensure a slug-fest between Badawi and Najib which would weaken further the present leadership of UMNO.
No doubt this is a brilliant political gambit by the Opposition, but would Badawi take the bait? Your guess is as good as mine.
But as far as I am concerned, this wayang kulit is getting tiresome and a total distraction from the urgent task of ensuring that Malaysia survives the global financial tsunami. Already the President of the Federation of Malaysian Manufacturers (FMM) has warned, “pressures have started to build up within the sector, and many companies are beginning to face difficulty to stay afloat. It is imperative that the RM7 billion package is implemented quickly, efficiently and effectively to help keep businesses in operations.” But our politicians are too engrossed in power grabs to pay any attention to the welfare of the people.
Many still hold on to the illusion that Anwar Ibrahim will be the saviour of Malaysia and that he will usher a new era of transformation.
It is an exercise in futility to counter such stupidity.
Anwar Ibrahim and Badawi are essentially spin doctors and come from the same political stock, and as they weave their political intrigues to ensure their political survival in the midst of the worst global financial crisis in a hundred years, the people will soon see the ugly and devious side of these two leaders.
When 800,000 or more unemployed roam the streets for economic justice, be assured that these two leaders will be the first to be lynched for their neglect and mismanagement of the national economy.
Whether Badawi reneges on his public commitment to step down in March 2009 is a rumour or a calculated political ploy, the fact of the matter is that the country is heading towards financial mess and the people will not take too kindly to such political intrigues.
And should Pakatan Rakyat continue to focus on grabbing power from Barisan Nasional instead of addressing urgent issues of growing retrenchments, business closures and inevitable foreclosures of homes when families struggle to pay their debts, I will expose their dastardly deeds and hunt them down one by one!
My advice to Anwar and Badawi – stop dreaming and do the country a favour, go back to your shit hole in Penang and leave the country alone so that we can clean your bloody mess and move on! Persist and we shall come after you with a vengeance and you will have to pay dearly for your misdeeds.
[Baca]
23 January 2009, The Daily Reckoning
We've been on Bubble Watch for the last ten years.
Now, we're on Bust Watch...
Tim Geithner, Obama's choice for Treasury Secretary, may not have seen the bust on Wall Street coming... but he promises action on a "dramatic scale" to fix it. That is probably what goosed-up the Dow yesterday - up 279 points. Oil rose to $43. Both gold and the dollar went down. The dollar fell to $1.29 per euro... while gold sellers got $5 less per ounce. The price of gold is $850.
"The End of the Reagan Era," is how the French newspaper, The Liberation, described the handover of power to Barack Obama's team.
The Liberation has it right. What we are witnessing is the end of an era. But it's not exactly the era most people think. The voters made a big symbolic change when they elected Obama. But politically, Obama is not so different from Reagan, Bush I, Clinton or Bush II.
A much bigger change has just occurred - and gone almost unnoticed. This one was wrought not by the voters, but by Mr. Market. He has brought an end to the world financial system that arose during the Reagan years.
For the last ten years, these Daily Reckonings have been on Bubble Watch... watching... wondering... marveling... sometimes appalled... sometimes amused...
...what we were watching was the blow up of a crazy system of imperial finance, in which the world's hegemony appeared to live at the expense of its rivals... and the imperial citizens - those in the homeland of the United States of America - drove themselves into bankruptcy so competitors could continue to sell their products at a profit.
It was strange. It was preposterous. But it wasn't dull. We thought it was coming to an end in 2001... when the bubble in dotcoms blew up. Then, well, you know what happened... the feds got to work... and pumped up more bubbles. Now, the Bubble Epoque is nearly over. But Mr. Obama is jumping the gun...
"Starting today, we must pick ourselves up, dust ourselves off and begin again the work of remaking America," he says.
Hold on... there are some huge busts that have to happen first... We're watching for busts in U.S. government debt (U.S. Treasury paper)... the dollar... and finally, after a big run-up, gold. Then, Americans can rebuild on a more solid foundation.
The gist of the world economy for the past quarter century was a division of delusion, which led to huge bubbles. Americans pretended to have good money. Asians pretended to have a good customer. Bankers pretended to have good credits. And Wall Street pretended that toxic assets were good ones.
Asians made; Americans took. Asians saved; Americans borrowed. Americans provided the demand. Asians provided the supply. Asians built a real economy, with real money, and real factories and real skills. America's economy was mostly a conceit, in which people became accustomed to a standard of living that very few of them could afford.
But now it has come to an end. And whom do you think will suffer most?
Our guess: the Chinese!
Eighty years ago, America was in China's position. It was the world's young, growing, dynamic economy. Manhattan soared then as Shanghai soars now. But when the collapse came in the '30s, the demand for American goods shriveled. Foreign and domestic purchasers pulled in their belts and cancelled their orders. For a while, America was out of business. It was only at the onset of WWII that the orders started coming in again in massive quantities.
This time, it's China that's going out of business.
Yes, dear reader, China is going to suffer even more than the United States. At least in the short run. America will lose its position in the world. The dollar will lose its status as the world's reserve currency. Americans will be beaten up - first by deflation, then by inflation. When it is over, they will be poorer, wiser, and probably better people... With a little luck and good leadership, maybe they can sink into a graceful post-imperial poverty... followed by genuine prosperity.
That is the story we'll be covering in The Daily Reckoning going forward. It is the story of BUSTS. Companies will go bust. Governments will go bust (Ireland and Iceland are already effectively broke.) Households will go broke by the millions. And, eventually, even the U.S. government itself will go bust. (A bankruptcy that will most likely be disguised by inflation...)
But China! There, the story will be even more dramatic... even more dangerous... even more explosive!
*** "Time to mobilize for all-out war," says a headline in the Financial Times, speaking of saving Britain's banks from themselves. But this could just as well refer to President Obama's attack on the correction. Nobody wants a correction. And Team Obama has pledged to fight it to the death.
Which is why we will stick with our "Trade of the Decade". Buy gold on dips; sell stocks on rallies. This trade - announced 9 years ago - has been good to us. Gold has closed every single year ahead of where it started. From under $300 an ounce it went up over $1,000 - briefly. Now, it trades in the $800 range.
What do you think, dear reader? Is the gold bull market over? Are the troubles in the world financial system all taken care of? Is it time for another bust in the gold market - the only market (aside from U.S. Treasuries) to resist last year's sell-off?
"My one recommendation for the longer term," says Felix Zulauf in Barron's, "is physical gold. Consider the basic set-up: World economies are so weak that we are seeing government stimulation of historic proportions. At first this is deflationary, but it will become inflationary. Gold is the only currency that won't get devalued. It will be revalued.
"If the Fed's liabilities had to be covered in gold, it would sell for more than $6,000 an ounce. We aren't going back to the gold standard, but the markets won't trust the central banks anymore. Gold is a very slow bull market... the gold market could have a shakeout in the next 6 months, and the price could fall back to $700 an ounce or below from today's $850. But two years from now it will be a lot higher. It is one of the few commodities that held up during the forced liquidation of almost everything else. "
*** If the United States catches the flu... the rest of the world throws up.
And now, with markets retching all over the planet, finance ministers are getting together to come up with a global solution. Somehow, demand must be stimulated in Asia. Supply must be coaxed out of the United States. Balance must be restored, they say.
But don't hold your breath. Any global bailout plan is bound to be a bad one. Because what the world really needs is a correction. And no country wants one. Instead, each nation does its best to push the correction onto its neighbors. An old friend, Lord Rees-Mogg, adds further comment:
"Between the mid nineteenth and mid twentieth century, there had been a vigorous debate about the causes of the trade cycle, and of the crises which had upset the growth of the world economy.
"That debate had, however, never reached a conclusion. Among economists there was no consensus on what caused the crises to occur or on what measures would help to stabilise another depression...
"...there are at least five different alleged causes, which are still arguable. If the Central Bankers and Treasury Ministers do not agree on the cause of the present crisis they are not likely to agree on the remedy. One needs to keep theory in mind because it influences decision-making.
"However, we are beginning to see that there is a consensus developing on the policy that is needed. Economists and politicians are concentrating on the need to restore confidence. The Inaugural Address of President Barack Obama repeated the theme of Franklin Roosevelt's Address in March, 1933: 'We have nothing to fear, but fear itself.' He also attacked the greed and irresponsibility of the bankers, who had behaved just as badly as they did in the early 1930s. The practical action of Governments around the world is to increase the money supply until businesses will borrow and banks will lend. Everyone recognises that this makes a risk of excessive inflation of the money supply, but it is a risk which Governments feel they have no choice but to take. They are not trying to rebalance the world economy; they are desperate to relight the boiler. In the end they will succeed."
Inflation is what they want; inflation is what they will get.
Bill Bonner
[Baca]
Oleh NURUL IZZAH SIDEK (fikrahremaja@yahoo.com)
Para remaja wajar berasa terpanggil untuk menguatkan semangat memajukan ekonomi umat Islam
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DR. Yusuf al-Qaradawi dalam karyanya Aina al-Khalal pernah
berkata: "Kekuatan ekonomi kita terbengkalai. Kita hidup di bumi Allah
yang paling strategik, paling baik dan subur. Bumi yang paling banyak
galian yang tersimpan dalam perutnya dan kekayaan yang bertebaran di
atasnya. Malangnya kita tidak menggerakkan kekayaan kita, tidak bertani
di bumi kita, tidak menghasilkan keluaran daripada galian sedangkan
bahan mentahnya dikeluarkan dari bumi kita…jadilah kita dalam banyak
keadaan pengguna bukan pengeluar, pengimpot bukan pengilang. Kadang
kala kita menghasilkan produk yang kita tidak memerlukannya dan kita
abai menghasilkan barangan yang sangat kita perlukan. Kita berbangga
dengan memiliki kereta-kereta mewah antarabangsa, sedang kita tidak
tahu untuk membuat basikal sekalipun."
Bunyinya pahit, tetapi ada benarnya. Apatah lagi dalam keadaan kita
yang sudah lama terluka melihat penderitaan dan penghinaan yang
dilakukan terhadap umat Islam di seluruh dunia. Krisis ekonomi yang
melanda dunia kini menambah buruk keadaan ekonomi negara-negara Islam
yang rata-ratanya menjadi pengguna daripada barangan hasilan
tangan-tangan pengeluar bukan Islam.
Tidak dapat dinafikan bahawa kemakmuran sesebuah negara bergantung
kepada kemajuan ekonomi, dan kekuatan ekonomi sangat bergantung kepada
hasil usaha rakyat negara itu sendiri. Justeru, dalam kita menangisi
keperitan saudara-saudara kita, sewajarnya kita terutamanya remaja
bermuhasabah dengan kekuatan dan kelemahan yang kita ada dan seterusnya
merencana strategi untuk memartabatkan ekonomi umat Islam supaya tidak
terlalu bergantung kepada negara Barat.
Rasa tanggungjawab
Pada dasarnya, banyak kelebihan yang dapat dinikmati sekiranya umat
Islam bersatu padu dalam menjana ekonomi umat sendiri, antara lainnya
mereka akan mempunyai kuasa membeli yang tinggi kerana kapasiti jumlah
umat Islam yang tinggi menjadikan keperluan barangan dan makanan juga
tinggi.
Jika kuasa membeli ini dialirkan kepada membeli barangan yang
dihasilkan oleh umat Islam sendiri, akan berlakulah kitaran ekonomi
yang kuat di kalangan masyarakat Islam. Selain itu, umat Islam
mempunyai ruang dan potensi yang luas untuk memajukan ekonomi sendiri
dalam bidang makanan, minuman dan ubat-ubatan berdasarkan kewajipan
untuk menggunakan produk-produk yang halal dan suci pembuatannya.
Sudah tiba masanya umat Islam menghasilkan produk dan barangan
sendiri. Dalam menjayakannya, modal, idea dan tenaga sangat diperlukan
dalam memajukan bidang ini. Para remaja wajar berasa terpanggil untuk
menguatkan semangat untuk memajukan ekonomi umat Islam. Semangat untuk
memajukan ekonomi umat Islam harus ditunjangi dengan kekuatan akidah
yang kukuh dan rasa tanggungjawab untuk membangunkan umat.
Apabila rasa tanggungjawab untuk membantu umat mewarnai sikap
seseorang remaja, maka secara tidak langsung ia akan membuatkan
seseorang menjadi komited dan cekal dalam sesuatu bidang yang diceburi.
Amat menyedihkan apabila hasil bumi negara sendiri dikaut oleh orang
luar, dan tenaga muda yang ramai dan segar tidak dilatih untuk
mengusahakan hasil bumi mereka dan hanya bergantung kepada kepakaran
luar.
Remaja Islam harus bercita-cita tinggi untuk menjayakan matlamat ini
dengan bersikap berani untuk meneroka bidang dan pasaran baru. Bidang
perniagaan dan keusahawanan adalah bidang penuh dengan risiko dan
cabaran, tetapi mendatangkan punca rezeki yang lumayan jika berhasil.
Setinggi nama Islam
Namun begitu, barangan yang dihasilkan mesti mempunyai kualiti yang
tinggi seperti kerana ia bukan sahaja mencerminkan sesebuah jenama,
tetapi juga menampilkan imej pengeluar. Apabila sesebuah produk
mendapat kepercayaan pembeli, maka secara tidak langsung ia mengangkat
imej pembuatnya.
Bayangkan jika barangan yang dihasilkan seseorang atau sebuah
syarikat itu tidak bermutu dan berkualiti, agak sukar untuk mendapat
kepercayaan pembeli untuk membeli barangan tersebut. Lebih malang lagi
jika semua barangannya akan dilabel sedemikian rupa. Usahkan hendak
bersaing di pasaran antarabangsa, di tempat sendiri pun tidak diterima.
Tidak dapat dinafikan bahawa penghasilan barangan yang berkualiti
dikuatkan daripada penyelidikan dan program pembangunan yang konsisten
dan bermutu. Melalui bidang penyelidikan, kualiti sesuatu barangan
boleh sentiasa ditingkatkan, bukan sahaja untuk keuntungan perniagaan,
malah untuk disebarkan untuk kebaikan ramai.
Oleh itu, remaja Islam wajar meneladani sikap para saintis dan
cendekiawan terdahulu dalam menghasilkan sesuatu barangan dan penemuan
yang bermutu. Tradisi penyelidikan Islam yang sangat mementingkan
ketelitian dan komitmen yang tinggi telah berupaya membangunkan tamadun
Islam yang maju suatu ketika dahulu. Dalam pada kita mengagumi ciptaan
Barat, kita juga seharusnya berupaya untuk mencetuskan idea-idea dalam
acuan kita sendiri.
Di negara kita, banyak peluang yang telah diteroka untuk
membangunkan ekonomi umat Islam. Banyak organisasi yang ditubuhkan
untuk membantu meningkatkan pendapatan dan merencana langkah-langkah
strategik untuk menjana ekonomi umat Islam. Festival Ekonomi Islam yang
berlangsung baru-baru ini telah membuka banyak peluang kepada usahawan
tempatan untuk menampilkan produk mereka. Melalui pendedahan sebegini,
ruang lingkup perniagaan dapat diluaskan.
Malah, remaja juga boleh didedahkan kepada selok-belok perniagaan
supaya suatu hari mereka bakal menghasilkan suatu empayar perniagaan
sendiri dan dapat membantu menjana ekonomi umat. Ia juga memberi
peluang kepada usahawan-usahawan baru untuk menonjolkan bakat
kepimpinan mereka. Idea-idea yang segar dan strategi yang bijaksana
boleh ditampilkan daripada remaja agar barangan atau produk tidak hanya
terhad kepada pasaran tempatan, tetapi juga terpasar di luar negara.
Kesimpulan
Cinta terhadap Islam bukan sahaja sekadar ritual dan pengucapan,
tetapi juga keazaman yang tinggi untuk menjadikan umat Islam umat yang
dipandang tinggi dan mulia dan tidak mudah dipijak dan dihina.
Dalam pada kita mengambil langkah untuk memulaukan jenama daripada
Barat, kita mestilah bersedia dengan barangan keluaran kita sendiri
agar langkah pemulauan tidak hanya bermusim.
Sesuatu produk keluaran, baik dalam bentuk barangan mahupun
perkhidmatan sewajarnya diberikan dalam bentuk yang terbaik supaya
tertampil dengan jenama dan kualiti tersendiri seperti tingginya nilai
agama Islam itu sendiri.
[Baca]
Oleh ZUARIDA MOHYIN
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Masjid yang berada di
Xi'an, China ini dikatakan telah berusia lebih 800 tahun dan menjadi
destinasi pelancong dari seluruh dunia.
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HARI ini imej Islam menjadi tercalar disebabkan oleh persepsi orang
bukan Islam terhadap Islam amat sempit. Gambaran mereka terhadap Islam
hanya berkisar isu-isu orang Melayu, Arab, keganasan dan pelbagai label
negatif.
Hal ini sedikit sebanyak turut mempengaruhi pola perkembangan dakwah
Islamiah di kalangan bukan Islam, terutamanya orang Cina di negara ini
yang ketara amat perlahan berbanding negara-negara lain di dunia.
Sungguhpun Malaysia sudah merdeka lebih 50 tahun, namun orang Cina
yang memeluk Islam tidak sampai satu peratus. Hari ini penduduk Cina di
Malaysia berjumlah 6.5 juta - ini bermakna orang Cina yang memeluk
Islam hanya sekitar 60,000 orang.
Berbeza di negeri bukan Islam, agama Islam mendapat sambutan yang
begitu hebat. Tetapi kenapa dalam negara Islam sendiri, agama Islam
seolah-olah kelihatan tidak mendapat tempat dan perkembangannya amat
perlahan. Di manakah silap dan salahnya? Kajian yang serius perlu
dilakukan.
Timbalan Presiden Persatuan Cina Muslim Malaysia (Macma), Dr. Mohd.
Ridhuan Tee Abdullah yang telah lama berkecimpung dalam dunia dakwah
terutama kepada kaum Cina bukan Islam, menegaskan bahawa cara kita
'menjual' Islam hari ini amat bersifat etnik atau kemelayuan atau
kearaban.
Lantaran itu, saran beliau, sudah sampai masanya untuk dipecahkan
tembok ini dengan membukakan minda kita agar dapat menjual Islam dalam
konteks yang lebih luas dan global.
"Caranya tidak lain dan tidak bukan, marilah kita mulakannya dengan
membina sebuah masjid berseni bina Cina di tengah-tengah ibu kota Kuala
Lumpur. Saya yakin kita semua akan dapat lihat banyak perubahan,
terutamanya perkembangan syiar Islam.
"Penubuhan masjid Cina Muslim ini membolehkan usaha mendekatkan
golongan bukan Islam ini terhadap Islam. Selain menyelesaikan kes-kes
lain yang membabitkan golongan Cina Muslim seperti kes murtad yang
berpunca daripada ketiadaan pemantauan serta penjagaan kebajikan
daripada pihak bertanggungjawab.
"Kewujudan masjid berseni bina Cina yang turut berfungsi sebagai
pusat aktiviti dakwah, sudah tentu dapat menyelesaikan banyak
permasalahan dalam usaha merealisasikan dakwah Islamiah, terutama di
kawasan bandar yang majoritinya dihuni oleh masyarakat Cina," kata Dr.
Mohd. Ridhuan akan kepentingan disegerakan pembinaan masjid Cina ini
dan kebaikan yang bakal diperoleh.
Menurutnya lagi, idea penubuhan masjid berseni bina Cina ini telah
diutarakan sejak Macma ditubuhkan pada 1994. Namun, hasrat ini mula
disuarakan pada 1996 dan menjadi semakin berkumandang pada 2000 hingga
sekarang.
"Kami telah menemui menteri-menteri yang menjaga hal-ehwal Islam
untuk merealisasikan hasrat tersebut sejak sekian lama," katanya semasa
diminta mengulas usaha pihaknya merealisasikan pembinaan masjid Cina di
negara ini.
Mohd. Ridhuan bersyukur usaha berterusan itu akhirnya mendapat
respons positif serta sokongan penuh daripada Menteri di Jabatan
Perdana Menteri, Datuk Zahid Hamidi.
Ini kerana kata Mohd. Ridhuan, menteri itu bukan sekadar memahami
tetapi melihat hasrat persatuan yang mewakili komuniti Cina Muslim
Malaysia dari perspektif yang luas serta demi perkembangan dakwah,
waima beliau bukan berlatar belakangkan pengajian agama sepenuhnya.
Ditambah pula sokongan daripada Perdana Menteri, Datuk Seri Abdullah
Ahmad Badawi agar usaha ini disegerakan. Respons positif diperoleh
rentetan daripada surat yang telah diajukan kepada Abdullah pada 14
Ogos lalu. Seterusnya diikuti dengan beberapa perbincangan dan
pertemuan yang masih berterusan sehingga kini.
Lantaran itu, Mohd. Ridhuan menyakini kesungguhan yang ditunjukkan
oleh pemimpin negara itu bakal menamatkan penantian yang selama ini
diharapkan komuniti Cina Muslim khasnya dan umat Islam di Malaysia.
"Setakat ini perbincangan tentang tapak pembinaan di Kuala Lumpur
sedang diadakan. Sudah tentu kami mahukan tempat yang strategik di
kawasan majoriti orang Cina. Contohnya, di tapak bekas Penjara Pudu.
"Saya fikir tapak ini amat strategik. Jika berjaya direalisasikan,
saya yakin perkembangan Islam akan menjadi semakin hebat, selain ia
akan menjadi tumpuan pelancong dalam dan luar negara. Yang pastinya,
kawasan itu strategik untuk perkembangan dakwah.
"Lagipun, kawasan bekas tapak penjara ini, tidak sesuai untuk
dibangunkan sebagai pusat komersial. Keadaan di sana hari ini penuh
sesak. Sekiranya kawasan tersebut dijadikan sebuah masjid berseni bina
Cina, ia mampu menjana ekonomi negara dari sudut pelancongan," katanya.
Beliau juga menepis anggapan segelintir pihak yang mengatakan
pembinaan masjid Cina akan memecahbelahkan masyarakat, merosakkan
keharmonian dan perpaduan kaum di negara ini.
Jelas Mohd. Ridhuan, pandangan golongan ini menunjukkan kedangkalan
pemikiran dan kegagalan mereka untuk melihat Islam sebagai agama yang
bersifat sejagat atau universal.
"Mereka hanya melihat agama adalah untuk etnik tertentu sahaja.
Sedangkan Islam adalah agama untuk semua manusia yang ada di muka bumi
ini. Persoalan saya, adakah masjid yang berseni bina kubah adalah seni
bina Islam atau seni bina Melayu. Sebenarnya, kubah adalah berasal
daripada seni bina Moorish Indian, tidak ada kaitan langsung dengan
seni bina Melayu atau Islam.
"Kenapa kita boleh menerima seni bina Moorish Indian, tetapi tidak
seni bina Cina atau bangsa lain? Apakah selama ini kewujudan masjid
India dan masjid Pakistan telah memecahbelahkan masyarakat hari ini?
Perlu diingatkan bahawa seni bina atau reka bentuk yang wujud hari ini
adalah ilham yang diberikan oleh Allah SWT kepada manusia.
"Maknanya, seni adalah hak Allah SWT. Cuma jangan sampai kesenian
itu mempunyai unsur yang bercanggah dengan hukum Allah seperti
mempunyai unsur-unsur patung dan sebagainya," tambah Mohd. Ridhuan yang
hanya mahu memecahkan tembok stereotaip yang telah lama terpahat dalam
pemikiran orang bukan Islam bahawa Islam itu agama orang Melayu atau
orang Arab.
Menjawab persoalan kekangan yang dihadapi dalam merealisasikan
hasrat murni ini, menurut Mohd. Ridhuan halangan yang paling ketara
ialah untuk memecahkan tembok pemikiran lama masyarakat Malaysia
termasuk orang agama.
"Jika orang agama pun tidak boleh faham, cuba bayangkan bagaimana
dengan orang biasa. Bagi kami, fungsi masjid adalah sama seperti
masjid-masjid lain. Tertakluk kepada undang-undang dan
peraturan-peraturan Majlis Agama Islam Negeri-Negeri. Ini bermakna,
tidak timbul isu, masjid ini khusus untuk orang Cina sahaja.
"Apa yang kami mahukan ialah seni binanya sahaja yang berbentuk Cina
atau berbentuk pagoda seperti mana masjid-masjid yang terdapat di
negeri China. Ia bertujuan untuk mengalihkan pandangan masyarakat Cina
bahawa kewujudan mereka di muka bumi ini adalah dengan ciptaan Allah.
"Malah ada pula yang berpandangan masjid ini nanti akan dibolot oleh
orang Cina sahaja, bermula daripada ahli jawatankuasanya sehinggalah
penggunaan bahasa syarahan dan khutbah. Ini adalah kekeliruan yang
sengaja dibuat-buat," katanya apa yang matlamat untuk mengalihkan
perhatian bukan Islam Cina supaya melihat Islam dalam perspektif yang
luas.
Hakikatnya, ujarnya lagi, masalah pentadbiran dan pengurusan masjid
Cina tersebut adalah isu kecil dan terpinggir. Apa yang dimahukan
setakat ini hanyalah masjid yang berseni bina Cina.
Saran Mohd. Ridhuan, umat Islam perlu sedar bahawa kejadian
bangsa-bangsa ini adalah ciptaan Allah SWT sebagaimana firman-Nya dalam
surah al-Hujurat ayat 13 yang bermaksud: Hai manusia, sesungguhnya
Kami menciptakan kamu dari seorang lelaki dan seorang perempuan dan
menjadikan kami berbangsa-bangsa dan bersuku-suku supaya kamu saling
kenal mengenal.
"Ini bermakna seni bina juga adalah anugerah Allah hasil kreativiti
manusia ciptaan-Nya. Justeru, ia perlu saling diraikan antara satu sama
lain selagi mana ia tidak bercanggah dengan syariat. Inilah keindahan
Islam. Lagipun, ia adalah alat dakwah yang membawa makna yang cukup
besar," jelas beliau.
Mohd. Ridhuan menambah, tidak perlu syarat 40 jemaah untuk membina
masjid Cina Muslim seperti yang digembar-gemburkan. Masjid Cina Muslim
tidak semestinya dipunyai oleh masyarakat Cina Muslim sahaja.
Katanya, prinsip asas masjid mesti difahami dengan jelas. Ia adalah
kepunyaan semua orang Islam dan dalam konteks undang-undang, ia mesti
diletakkan di bawah pengawasan Jabatan Agama Negeri-Negeri.
"Kita boleh namakan apa sahaja nama pada masjid tersebut. Apa yang
dipinta ialah sebuah masjid yang mempunyai seni bina Cina yang dapat
menarik perhatian orang Cina bukan Islam untuk melawati masjid tersebut
bagi mendapatkan penerangan mengenai Islam, menjadi pusat pelancongan
dan pusat pemudah cara.
"Ini dapat memudahkan kita menerangkan kepada mereka tentang
keindahan agama Islam sebenar yang bersifat universal dan tidak hanya
dilihat hanya anutan kaum tertentu sahaja," katanya.
Masjid Cina dan sejarahnya
Oleh ZUARIDA MOHYIN
DALAM kita bertelingkah berkaitan isu pembinaan masjid Cina Muslim,
seorang penulis dari negara China, Yusuf Liu Bao Jun menegaskan tidak
ada apa yang perlu dikhuatiri serta berkeyakinan bahawa usaha ini
adalah satu langkah positif sekiranya masjid berkonsep Cina
direalisasikan di Malaysia.
Penegasan penulis bebas kelahiran daerah berautonomi Muslim di Zhang
Jiachuan Hui, Wilayah Gansu, China ini bersandarkan penyelidikan
terbaru beliau tentang kewujudan masjid-masjid berkonsep Cina di
seluruh dunia.
Kata beliau, sebenarnya ramai mungkin tidak tahu bahawa sebuah masjid tertua di Malaysia yang diberi nama Masjid Besar (Big Mosque)
telah dibina oleh seorang lelaki yang berasal dari negara China iaitu
Song Shilin pada 1877, sebaik beliau memeluk agama Islam dengan
menggunakan nama Shamusudin Song.
Legenda mengatakan Shamusudin terdampar di Melaka setelah kapalnya
karam di Selat Melaka sebelum dia diselamatkan oleh orang Melayu. Sejak
itu, dia menetap di Kampung Ulu dan kemudiannya berkahwin dengan
perempuan tempatan Melayu selepas mengucap syahadah.
"Pada 1880, dia menjadi kaya hasil daripada perniagaan yang
diusahakan dan berhasrat membina sebuah masjid. Dikatakan juga,
sebahagian daripada bahan mentah untuk pembinaan masjid itu diimport
dari China dan seni reka binaan masjid itu benar-benar dipengaruhi seni
bina tradisi China.
"Fenomena seni bina berciri Cina inilah yang akhirnya tersebar ke
banyak masjid di Melaka," kata Yusuf Liu yang telah menghasilkan
sembilan buku dalam tiga bahasa iaitu bahasa Inggeris, Melayu dan Cina.
Penulisan beliau banyak menyentuh perihal masyarakat Cina Muslim dan kebudayaan mereka.
Indonesia
Malah kata Yusuf Liu lagi, negara tetangga Malaysia seperti di
Indonesia turut mempunyai beberapa masjid yang dibina oleh golongan
Cina Muslim yang menetap di situ sejak pelayaran Laksamana Cheng Ho
pada 1405.
Dikatakan sumbangan orang Cina Muslim Indonesia juga agak menonjol
dalam pembinaan masjid-masjid di beberapa bandar raya besar di negara
itu. Menurut buku yang berjudul, Real Motherland tulisan
Dardina Dardoxi, seorang ilmuwan Indonesia mengatakan terdapat tiga
buah masjid yang dibina oleh orang Cina Muslim pada abad ke- 18 iaitu
Masjid Juziyuam, Masjid Danparla dan Masjid Gelougute. Masjid Juziyuam
dibina oleh seorang Cina Muslim bernama Tan Jin Wu dan Masjid Gelougute
dibina oleh Tamien DosoSeeng pada 1785.
"Apa yang saya ketahui di Jakarta sahaja terdapat empat masjid,
antaranya Masjid Kebon Jeruk dan Masjid Lautze. Sementara di Surabaya
terdapat sebuah masjid yang diberi nama Masjid Cheng Ho," jelasnya.
Malah katanya, merujuk buku Indonesia Daily (20 Mac 1990)
menjelaskan Masjid Sumenapu yang terletak di Pulau Madla terbina pada
1763 oleh Liew Ping Er, seorang Cina Muslim sewaktu pemerintahan
Dinasti Sumenapu.
"Terdapat pagar agam yang bercat warna merah di Masjid Sumenapu di
mana diketahui umum bahawa warna merah adalah warna kegemaran
masyarakat Cina sebelum ditukar kepada warna putih dan kuning. Pun
begitu, seni bina Cina masjid itu masih kekal hingga ke hari ini," kata
Yusuf Liu.
Rusia
Di samping dua negara ini, beliau turut membuat penyelidikan di
Rusia. Menariknya di negara blok komunis ini terdapat 40 buah masjid
yang dibina oleh masyarakat Cina Muslim yang telah bermastautin di
negara tersebut. Masjid-masjid ini terdapat di Uzbekistan, Kyrgyzstan,
Turkmenistan dan Tajikistan.
Begitu juga lawatannya ke Thailand, Aceh, Arab Saudi, Hong Kong, Brunei, Laos dan Amerika Syarikat.
Oleh itu, Yusuf Liu berkeyakinan usaha mendirikan sebuah masjid
berseni bina Cina Muslim di tapak cadangan di Kuala Lumpur akan membawa
banyak manfaat. Baginya, selain menjadi pusat penyebaran dakwah, ia
sekali gus berperanan sebagai tarikan pelancong ke Malaysia.
[Baca]
Dari Sauban ia berkata: Telah bersabda
Rasulullah SAW: “Hampir seluruh umat manusia bersatu menghancurkan kamu
seperti orang yang sedang lapar mengerumuni makanan. Mereka bertanya:
Apakah kita sedikit pada masa itu wahai Rasulullah? Jawab Baginda:
Malah kamu ramai, tetapi kamu laksana buih air bah. Dalam pada itu hati
mereka tidak ada rasa segan terhadap kamu dan dalam hati kamu sendiri
tumbuh penyakit wahan. Apa yang dimaksudkan dengan penyakit watan itu
wahai Rasulullah? Maksudnya ialah di dalam hati kamu bertakhta perasaan
cinta dunia dan takut mati”. (riwayat Abu Daud).
Demikianlah gambaran yang berlaku pada umat Islam hari ini. Bilangan
Muslim di seluruh dunia yang melebihi 1 bilion ternyata tidak
menggentarkan musuh waima Israel yang kecil itu.
Contoh terbaru adalah kekejaman Israel ke atas penduduk Palestin di
Genting Gaza. Walaupun, rejim zionis itu dikelilingi oleh negara-negara
Islam Arab, rakyat Palestin terus dizalimi tanpa pembelaan.
Wartawan MOHD. RADZI MOHD. ZIN dan jurufoto, SAHARUDIN ABDULLAH
menemu bual Pensyarah Institut Kefahaman dan Pemikiran Islam (CITU),
Universiti Teknologi Mara Shah Alam, Prof. Madya Dr. Nik Mohd. Rosdi
Nik Ahmad bagi mengupas isu ini.
Apakah hikmah Nabi Muhammad SAW diutus di kalangan umat Arab?
NIK ROSDI: Rasulullah adalah keturunan Nabi Ibrahim iaitu antara
nabi yang bukan dalam kalangan Bani Israel. Memanglah kebanyakan nabi
yang diutuskan Allah adalah dari kalangan Bani Israel.
Semasa baginda diutuskan ke muka bumi, masyarakat Arab dari segi
tamadunnya adalah lebih menonjol berbanding Bani Israel. Akhirnya,
mereka seolah-olah dikongkong oleh bangsa lain. Bani Israel juga hidup
nomad.
Mereka juga adalah digelar bangsa kibti Firaun yang dianggap hamba
atau buruh kasar. Sebab itu Firaun mengejar Nabi Musa dan Bani Israel
yang keluar dari Mesir ke Laut Merah yang akhirnya menyaksikan kematian
Firaun ditelan air laut.
Sebab utamanya, kerana Firaun bimbang kerja-kerja membangunkan Mesir akan terbantut jika Bani Israel tidak ada.
Pada masa yang sama, ada banyak masalah yang melanda bangsa Arab
semasa zaman jahiliah. Mereka terkenal sebagai bangsa yang amat taksub
kepada perkauman atau assabiah. Mereka juga suka bergaduh sesama
sendiri. Pendek kata, apa yang berlaku pada Bani Israel seolah-olah ada
pada bangsa Arab.
Dengan itulah, Allah mengutuskan baginda untuk menyelesaikan segala
masalah. Perutusan Rasulullah SAW ke muka bumi ini seperti kita semua
sedia maklum adalah sebagai rahmat ke atas sekelian alam. Ini
dijelaskan menerusi firman Allah, Dan tidak kami (Allah) utuskan kamu
(wahai Muhammad) melainkan untuk menjadi rahmat bagi sekelian alam.
(al-Anbiya’: 107)
Bangsa Arab ini selain mempunyai kiblat dan kitab yang satu juga
berbahasa yang sama. Yang peliknya, mereka tidak juga boleh bersatu
menentang zionis. Di mana silapnya?
NIK ROSDI: Orang Arab ini dulunya memang suka bergaduh. Sehinggakan
nabi pun dibunuh. Contohnya, Nabi Zakaria yang disembelih oleh mereka.
Nabi Muhammad SAW telah diingatkan tentang hal itu semasa baginda
diutus oleh Allah. Sebab itu antara tindakan awal baginda selepas
berhijrah adalah mempersaudarakan puak Muhajirin dan Ansar. Kemudian
menghubungkan puak yang bertelagah di Madinah iaitu suku Bani Nadhir,
Qainuqa’ dan Khuraizah.
Selepas itu, baginda membentuk Sahifah Madinah (Perlembagaan
Madinah) sebagai undang-undang yang diterima pakai di kalangan penduduk
di sana.
Membentuk perpaduan ini amat penting dalam sesebuah masyarakat dan
negara. Ia adalah kunci kepada kekuatan sesebuah bangsa dan negara.
Ini dijelaskan oleh Allah menerusi firman-Nya yang bermaksud: Dan
berpegang teguhlah kamu dengan tali Allah (Islam), janganlah kamu
berpecah belah dan kenanglah nikmat Allah kepada kamu ketika kamu
bermusuh-musuhan (semasa jahiliah dulu), lalu Allah menyatukan di
antara hati kamu sehingga kamu bersatu padu dengan nikmat Islam) maka
menjadilah kamu dengan nikmat Allah itu orang-orang Islam yang
bersaudara. Dan kamu dahulu telah berada di tepi jurang neraka
(disebabkan kekufuran semasa jahiliah) lalu Allah selamatkan kamu dari
neraka itu...(ali-‘Imran: 103)
Sepatutnya orang Arab lebih memahami hal ini. Namun mereka nampaknya
tidak membaca al-Quran dan tidak ambil manfaat daripada kitab suci itu.
Ini juga menunjukkan kesan penjajahan Barat yang sangat mendalam kepada
orang Arab.
Dalam kes di Palestin, difahamkan ada di kalangan anggota Fatah yang
memberi maklumat lokasi pejuang Hamas kepada puak zionis. Apakah jenis
orang Islam begini?
NIK ROSDI: Dalam Islam ada golongan yang munafik. Mereka ini tidak
senang hati dengan Islam. Sentiasa mencari jalan memusnahkan orang
Islam.
Di Palestin, Hamas adalah lebih dekat dengan Islam manakala Fatah
pula bersekongkol dengan Amerika Syarikat (AS). Jadi musuh menggunakan
Fatah untuk menjatuhkan Palestin.
Pertelingkahan Fatah dan Hamas adalah punca krisis di Palestin.
Barangkali mereka lupa kepada firman Allah yang bermaksud: Dan taatlah
kepada Allah dan Rasulnya dan janganlah kamu berbantah-bantahan, yang
menyebabkan kamu menjadi gentar dan hilang kekuatanmu dan bersabarlah.
Sesungguhnya Allah beserta orang-orang yang sabar. (al-Anfaal: 46)
Inilah yang berlaku di kebanyakan negara kuasa besar. Mereka gunakan
golongan munafik untuk menjatuhkan Islam. Contohnya, di Afghanistan.
Apabila menghadapi serangan Rusia, puak Islam yang bertelagah bersatu
tetapi apabila Rusia balik mereka bergaduh semula.
Kemudiannya, muncul kumpulan Taliban yang menghadapi saingan
daripada Pakatan Utara. Akhirnya, AS gunakan Pakatan Utara untuk
menjatuhkan Afghanistan.
Islam menetapkan ketaatan kepada Allah dan rasul itu sebagai mutlak.
Walhal ketaatan kepad a pemimpin itu selagi mana mereka mentaati Allah
dan rasul-Nya.
Janji Israel memang tidak boleh dipercayai. Justeru apakah persiapan
yang perlu ada di kalangan negara Islam bagi menghadapi puak zionis ini?
NIK ROSDI: Sifat orang Yahudi ini telah dijelaskan oleh Allah
menerusi firman-Nya yang bermaksud: Orang-orang Yahudi dan Nasrani
tidak sekali-kali akan bersetuju atau suka kepadamu (wahai Muhammad)
sehingga engkau menurut ugama mereka (yang telah terpesong itu).
Katakanlah (kepada mereka): “Sesungguhnya petunjuk Allah (agama Islam)
itulah petunjuk yang benar”...(al-Baqarah: 120)
Apa yang malangnya, itulah tabiat umat Islam. Mereka suka menjadikan
Yahudi dan Nasrani sebagai kawan sebaliknya Muslim itu sebagai lawan.
Dalam hal ini, Rasulullah SAW bersabda: Sesungguhnya kamu pasti akan
mengikut jejak langkah orang-orang yang sebelum kamu – sejengkal demi
sejengkal, sehasta demi sehasta, sehinggakan jika mereka memasuki ke
dalam lubang dhab (sejenis biawak di padang pasir), pasti kamu akan
mengikut mereka. Kami (para sahabat) bertanya: Wahai Rasulullah! Adakah
Yahudi dan Nasrani (yang engkau maksudkan)? Jawab baginda SAW: Maka
siapakah lagi (kalau bukan mereka)? (riwayat Bukhari dan Muslim)
Untuk itu, kita tidak ada jalan lain selain kembali bersatu
mengukuhkan perpaduan. Pertubuhan Persidangan Islam (OIC) perlu
memainkan peranan penting dalam dalam hal ini.
Kita perlu mencontohi tindakan yang dilakukan oleh Rasulullah SAW selepas hijrah baginda ke Madinah.
Seterusnya, golongan ulama dan umarak (pemerintah) perlu digabung
jalinkan. Sebabnya kedua-dua pihak mempunyai pengaruh dalam masyarakat.
Membiarkan perpecahan antara kedua-duanya adalah antara faktor
kejatuhan tamadun Yunani Greek. Ia berlaku apabila pemerintah memberi
keutamaan kepada golongan Solon dan mengabaikan golongan Socrates (ahli
falsafah). Akhirnya puak Socrates bangun memberontak dan membawa kepada
tamatnya era kegemilangan tamadun Yunani.
Amir Syakib Arsalan dalam bukunya Mengapa Bukan Islam alami kemajuan
dan kenapa Umat Islam alami kemunduran antara lain menjelaskan umat
Islam tidak pandai membangunkan potensi yang ada seperti minyak untuk
kemajuan umat.
Yang kedua, umat Islam cintakan permusuhan. Apabila hadapi musuh
(bukan Islam) mereka bersatu tetapi selepas itu mereka kembali
bertelagah.
[Baca]
Oleh MOHD. RADZI MOHD ZIN
SISTEM perbankan Islam yang mula diperkenalkan pada awal tahun
1980-an terbukti mendapat sambutan daripada masyarakat. Walaupun
bermula dengan Bank Islam Malaysia Berhad (BIMB), permintaan masyarakat
terhadap perbankan Islam membuatkan bank-bank konvensional turut
menawarkan perkhidmatan perbankan Islam.
Berdasarkan pertambahan peratusan pemilihan ekuiti umat Islam yang
secara konsisten melebihi 16 peratus hanya selepas 1985 iaitu dua tahun
selepas penubuhan BIMB, Industri Perkhidmatan Kewangan Islam (IFSI)
berhak mendapat penghargaan sebagai salah satu pemangkin kepada trend
yang menggalakkan itu.
Sememangnya, hidup dipenuhi kekayaan dan kedudukan tinggi dalam
masyarakat memang dihajati oleh kita semua. Islam pun tidak melarang
umatnya berusaha dengan jalan yang betul mencari rezeki dan kekayaan
untuk keselesaan hidup di dunia.
Namun, pemilikan kekayaan adalah satu bentuk ujian Allah terhadap
hamba-Nya. Ini bertepatan dengan tugas kita sebagai hamba-Nya iaitu
pemegang amanah yang mesti cuba sebaik mungkin mengelakkan diri
daripada sebarang penyalahgunaan.
Dalam hal ini, Imam al-Ghazali menyebut, "Kekayaan itu umpama ular
yang membawa bersamanya bisa dan penawar, bahaya dan manfaat". Justeru,
sebagai umat Islam yang beriman kita seharusnya memastikan bahawa
segala bentuk kekayaan itu tidak melalaikan daripada menyembah Allah.
Ini selaras dengan firman Allah yang bermaksud: Tidak Aku jadikan jin dan manusia melainkan supaya mereka menyembah kepada-Ku. (az-Zariyaat: 56)
Salah satu instrumen penting dalam kekayaan adalah sistem kewangan.
Ia berfungsi sebagai medium memindahkan dana daripada unit ekonomi yang
mempunyai lebihan tabungan yang kemudiannya disalurkan semula ke unit
ekonomi yang mempunyai defisit tabungan.
Pengarah Urusan BIMB, Datuk Zukri Samat berkata, selain itu, sistem
kewangan Islam juga adalah sebagai konduit dalam pembentukan,
pemeliharaan dan pengagihan kekayaan.
Katanya, meskipun IFSI tidak kebal sepenuhnya daripada kemerosotan
atau krisis kewangan tetapi terbukti ia lebih berdaya tahan semasa
krisis.
"Malahan, kewangan Islam yang mengikut prinsip dan peraturan syariah
diperkukuh dengan penstabil intrinsik dan mekanisme penyerap kejutan
terbina dalaman yang membantu meningkatkan kekukuhan dan kestabilan
sistem kewangan secara keseluruhan," katanya
Beliau berkata demikian semasa membentangkan kertas kerja 'Peranan
Institusi Kewangan Islam Dalam Meningkatkan Pemilikan Kekayaan Ummah:
Satu Gagasan dan Cabaran Pelaksanaan' pada Kongres Ekonomi Islam Ketiga
di Pusat Dagangan Dunia Putra, Kuala Lumpur, baru-baru ini.
Kongres selama empat hari bermula 12 Januari itu adalah anjuran
Yayasan Pembangunan Ekonomi Islam Malaysia (Yapeim) dan Majlis
Perundingan Islam, Jabatan Kemajuan Islam Malaysia, Jabatan Perdana
Menteri.
Menurut Zukri, empat nilai utama iaitu rakan kongsi, etika, hubungan
terus dengan ekonomi sebenar dan tadbir urus melindungi sistem kewangan
Islam daripada pendedahan berlebihan terhadap risiko.
Rakan kongsi adalah perkongsian risiko dan ganjaran atau kontrak berdasar ekuiti. Etika pula adalah pengharaman maisir (judi dan spekulias), riba dan zulm (penindasan) serta amalan yang tidak beretika seperti menyorok barang dan monopoli.
Hubungan terus dengan ekonomi sebenar di mana semua transaksi berdasarkan aktiviti ekonomi sebenar, larangan gharar
(kesamaran atau penipuan). Tadbir urus pula adalah ketelusan dan
pendedahan yang lebih jelas serta akauntabiliti yang lebih mantap.
Zukri menambah, bagi membolehkan rakyat Malaysia khususnya umat
Islam menjana dan mengumpul kekayaan, menjadi kemestian untuk
memastikan mereka mempunyai apa yang diperlukan untuk hidup dengan
selesa terlebih dahulu.
Lebih tepat lagi, katanya, untuk mendapatkan pendapatan yang
mencukupi bagi keperluan asas yang minimum untuk isi rumah termasuk
makanan, pakaian, tempat tinggal dan pendidikan.
"Untuk itu adalah penting bagi kita semua mengkaji semua struktur
gaji dan pampasan ke arah sistem saraan yang menitikberatkan prestasi
dan ditanda aras mengikut amalan industri.
"Ia mestilah dalam lingkungan rangka kerja merealisasikan matlamat
sosial negara dan memastikan pengagihan kemakmuran ekonomi negara yang
lebih adil," jelasnya.
Seorang lagi pembentang kertas kerja, Prof. Madya Dr. Zuriah Abdul
Rahman pula berkata, falsafah dan etika Islam dalam setiap hal adalah
bertunjangkan konsep tauhid.
Katanya, ini bermakna semua aset yang terkandung di muka bumi ini
adalah kepunyaan Allah. Justeru tidak ada ruang untuk melakukan
kerosakan, tingkah laku yang merosakkan atau perkara yang bertentangan
dengan Islam.
"Jangan kita berputus harap dengan bantuan Allah dan jangan lupa
bahawa Allah itu Amat Mengetahui segala yang kita buat sama ada secara
terang-terangan atau tersembunyi," jelas Timbalan Pengarah Siswazah,
Sekolah Perniagaan Fakulti Pengurusan Peniagaan Universiti Teknologi
Mara, Shah Alam di Selangor ini.
Dalam bab perlindungan kekayaan pula, Dr. Zuriah berkata, Islam
menggariskan konsep tawakal iaitu selepas berusaha dan berikhtiar, ia
diserahkan kepada Allah.
Risiko
Usaha itu, katanya, perlu melibatkan dua kategori iaitu kawalan risiko seperti pengurangan risiko pendapatan dan harta.
Risiko kewangan pula adalah individu atau syarikat menyediakan dana
untuk membayar kerugian atau pampasan kepada mereka yang hilang
pendapatan atau harta disebabkan sebarang bahaya seperti bencana alam
atau memindahkan risiko keada pihak lain yang boleh membiayai kerugian
tersebut.
Bagi tujuan itu, Islam menyediakan sistem takaful sebagai instrumen
membantu muslim menjaga harta semasa hidup atau pun untuk kegunaan ahli
keluarga selepas pendeposit meninggal dunia.
"Skim takaful menggalakkan penyimpannya melabur dengan harapan
mendapat keuntungan di mana pada masa yang sama menyumbang kepada
tabung khas berasaskan konsep tabarru'," jelasnya.
Sementara itu, Dekan Institut Kewangan dan Perbankan Islam
Universiti Islam Antarabangsa Malaysia (UIAM), Prof. Madya Dr. Ahamed
Kameel Mydin Meera berkata, institusi kewangan Islam tidak terhad
kepada bank sahaja.
Katanya, ada beberapa institusi kewangan lain seperti agensi
pertubuhan zakat, wakaf dan Baitulmal yang amat perlu dikembangkan
terutama dalam keadaan ekonomi yang gawat waktu ini.
"Institusi zakat misalnya dapat diperbaiki dengan beberapa kaedah
seperti menggalakkan orang ramai membayar zakat, ketelusan dalam
pengagihan wang zakat dan mempelbagaikan cara agihan contohnya melalui
tajaan pendidikan rakyat miskin di sekolah-sekolah," katanya.
Menurut Dr. Ahamed Kameel lagi, institusi wakaf yang seperti
diabaikan perlu dikaji semula bagi membiayai misalnya sistem
persekolahan, universiti, hospital dan sebagainya.
"Wangnya juga boleh dimanfaatkan bagi membiayai pendidikan golongan miskin, kajian dan sebagainya," tambah beliau.
Dr. Ahamed Kameel berkata, Baitulmal juga berperanan besar dalam
mengurus sistem kewangan Islam. Dalam ekonomi dinar ia boleh memainkan
peranan sebagai minter atau gold custodian. Dinar emas akan menjaga serta mempertahankan kekayaan ummah.
"Pada saat ini, kita seharusnya mengakui gagasan mantan Perdana
Menteri, Tun Dr. Mahathir Mohamad yang cadangkan penggunaan dinar emas
khususnya bagi urusan perniagaan antarabangsa.
"Malaysia seharusnya menjual hasil minyak dan petroleum serta
lain-lain barangan eksportnya dengan tukaran nilai emas," jelasnya.
[Baca]
By ISABEL KERSHNER
Published: January 29, 2009
JERUSALEM — A day after President Obama’s special Middle East envoy called for a consolidation of the fragile Gaza cease-fire, the truce came under new strain Thursday when the Israeli military said Palestinians fired a rocket into Israel at dawn and Israel launched an air attack into southern Gaza.
On his first visit to the region in his new role, the envoy, George J. Mitchell, traveled to the West Bank to meet with Palestinian leaders on Thursday after discussions with Israel’s prime minister, Ehud Olmert
on Wednesday. In those talks, Mr. Mitchell said, he spoke of “the
critical importance” of consolidating the cease-fire that ended
Israel’s three-week offensive against Hamas.
As
Mr. Mitchell prepared to travel to Ramallah, Israel said it launched an
air attack in the southern Gaza town of Khan Younis against a “known
terrorist” accused by an Israeli military spokesman of being part of a
squad responsible for a roadside bombing on Tuesday that killed an
Israeli soldier on the Israeli side of the border.
News reports
from Gaza described the target of the attack as a Hamas policeman on a
motorcycle who was injured along with several civilians, including
schoolchildren.
But the Israeli military spokesman, who spoke
in return for customary anonymity, said the man was a member of a group
called Global Jihad. The spokesman said the man had once been a
supporter of Hamas, the Palestinian militant group which controls Gaza,
and which Israel holds responsible for all attacks from the coastal
strip.
“As the sole authority in the Gaza Strip, Hamas bears full
responsibility for all terrorist activity originating from Gaza,” an
Israeli military statement said on Thursday.
Global Jihad, a
small and shadowy group that broke from Hamas, took responsibility for
Tuesday’s roadside bombing. Israel retaliated with an air strike that
wounded a militant and a raid that killed a man whose family said he
was a farmer.
On Wednesday, the Israeli military said a rocket,
the first since the fighting ended on Jan. 18, was fired from Gaza
hours after Mr. Mitchell arrived in Israel from Cairo. It landed in an
open area in Israel, causing no injuries. Israel carried out a
retaliatory air strike against what the military said was a weapons
manufacturing plant in southern Gaza. There were no immediate reports
of casualties.
Mr. Mitchell told reporters after the meeting with
Mr. Olmert that a broadening of the truce should include a cessation of
hostilities, an end to weapons smuggling into Gaza and “the reopening
of the crossings” based on agreements reached in 2005.
Those agreements, brokered by the United States, called for Palestinian Authority forces loyal to President Mahmoud Abbas of Fatah,
a Hamas rival, to secure the Palestinian side of the crossings. But
Hamas took control of Gaza in 2007, routing the Palestinian Authority
forces there. Israel has since imposed a strict economic embargo on
Gaza, letting in only humanitarian aid and basic supplies.
An
Olmert aide said the prime minister told Mr. Mitchell that the
crossings would “not be permanently opened” until the case of a
captured Israeli soldier, Cpl. Gilad Shalit, was resolved. Corporal
Shalit was seized in a cross-border raid in 2006 and taken into Gaza.
Hamas is demanding that Israel release hundreds of Palestinian
prisoners, including many convicted of major terrorist acts, in
exchange for his release.
Hamas has rejected any linkage
between the reopening of the passages and the case of Corporal Shalit,
and it insists on the reopening as a prerequisite to a lasting
cease-fire. In a statement issued in Syria on Wednesday, the exiled
leaders of Hamas and seven other Palestinian militant groups said the
“factions of the resistance reject the signing of a truce agreement
before the opening of all crossing points, the lifting of the blockade
and the arrival of supplies.”
Mr. Mitchell planned to meet Mr.
Abbas and other Palestinian Authority leaders on Thursday. Mr. Mitchell
had no plans to meet with any representatives of Hamas, which the
United States, like Israel and the European Union, classifies as a terrorist organization.
In Davos, Switzerland, meanwhile, the United Nations Secretary General, Ban Ki-moon,
launched an appeal for $613 million in emergency aid for Palestinians
in Gaza, saying: “Help is needed urgently,” news reports said.
Mr.
Ban visited Gaza after both sides declared unilateral cease-fires
almost two weeks ago. He is the highest-ranking international figure to
have visited Gaza since the war. Mr. Ban was speaking to reporters
covering the World Economic Forum in Davos.
Isabel
Kershner reported from Jerusalem. Ethan Bronner and Taghreed El-Khodary
contributed reporting from Gaza, Myra Noveck from Jerusalem, and Alan
Cowell from Paris.
[Baca]
24 January 2009, TruthDig
It was early in October 2001, and I had been invited to New York City on behalf of The History Channel for a show in which I was to discuss the situation in Afghanistan in the aftermath of the Sept. 11 attacks. I was pitted against a seasoned American diplomat who had made his reputation negotiating peace accords in difficult corners of the world. I felt a little out of place, since my area of expertise was arms control and disarmament, and specifically how arms control was being implemented in Iraq. I had written a few scholarly articles about Afghan-Soviet relations, with a focus on the ethnic and tribal aspects of Afghan politics, and in the mid-1980s I had been an analyst with the Marine Corps component of the rapid deployment force, following very closely the Soviet war against the Afghan mujahedeen, so I wasn't totally out of my element.
I fully expected to play second fiddle to the veteran diplomat, and appreciated the opportunity to hear his insights into what clearly was a very difficult situation facing the Bush administration. Osama bin Laden and his al-Qaida organization had used their status as guests of the Taliban government of Afghanistan to formulate and implement their terrorist attacks against the United States. The question confronting the Bush administration was how best to respond. I had spent some time thinking over the problem and came down firmly against the idea of direct military intervention. History had shown that, since the time of Alexander the Great through the Soviet invasion and occupation, outside forces had fared poorly when they tried to impose their will on the diverse grouping of tribes and ethnic groups that made up Afghanistan.
Our fight, in any case, wasn't against the people of Afghanistan. To a certain extent, it wasn't even against the Taliban, since it was al-Qaida, not the Taliban, that had attacked us. Some, including leaders of the Bush administration, were making the case that the Taliban was directly implicated in the attacks since it had provided al-Qaida with a safe haven to plan the events of 9/11. It had yet to be proved that the Taliban was a witting host, however. As a student of the region, I believed that the United States would do well to use tribal concepts of honor to isolate and disenfranchise bin Laden and his Arab outsiders from their Taliban host. If the United States, working through the offices of the Pakistani intelligence services, could convince the Taliban that its hospitality had been abused by al-Qaida-in that the murder of innocents had been committed while under its protection-then Afghan tribal custom and honor and, even more important to the fundamentalist Taliban, Islamic law, dictated that the Taliban revoke the protections and privileges afforded bin Laden and al-Qaida.
I did not believe that the Taliban would impose justice itself, but rather could be convinced, through a combination of logic and economic incentive, to disperse al-Qaida and turn bin Laden and his senior leadership over to a third party, presumably an Islamic nation such as Pakistan or the United Arab Emirates. If a direct approach failed, then covert action, using proxy forces in Pakistan and Iran, would make contact with moderate elements of the Taliban, personified by its foreign minister, to remove the conservative Mullah Omar from power and achieve a more direct result against bin Laden and his cohorts. A new, moderate Taliban leadership would be more than capable of assembling the religious clerics necessary to convene a sharia, or Islamic, court, which would find the actions of al-Qaida to be violations of Islamic law. Also, a loya jirga, or tribal gathering, would revoke the protected status of "guest" enjoyed by bin Laden and his fellow terrorists. The least productive option America could pursue was that of direct military intervention, and I anticipated that the veteran diplomat would concur with that point of view.
What happened, however, was the exact opposite. The diplomat rejected out of hand any sort of diplomacy, arguing that there were only extremists within the ranks of the Taliban. There was, in his opinion, no such thing as a moderate Taliban, and as such the United States had no choice but to lump the Taliban and al-Qaida into a singular target set, and initiate direct military action designed to remove the Taliban from power and destroy al-Qaida in Afghanistan. I responded by noting that it would not be an easy thing to separate the Taliban from Afghan society, since the Taliban was a product of Afghan society, and that any military action against the Taliban would only strengthen the bonds between it and al-Qaida, which was of course the last result the United States should be seeking. The diplomat rejected my argument as simplistic and unrealistic. He argued for a military solution, and, of course, that was the result the Bush administration delivered. The diplomat's name? Richard Holbrooke.
The new secretary of state, Hillary Clinton, has appointed Holbrooke as the U.S. special envoy for Afghanistan and Pakistan. With his extensive experience in peacemaking, including negotiating the Dayton Accords, which brought an end to the horrific fighting in Bosnia-Herzegovina, Holbrooke seems an ideal candidate for the complexities represented by the ongoing situation in Afghanistan, as well as by the related unrest in neighboring Pakistan. The presence of NATO forces in Afghanistan also plays to Holbrooke's perceived strengths, given the role played by NATO in bringing an end to the fighting in the former Yugoslavia. However, at a time when NATO itself questions the viability of the mission in Afghanistan, pushing for a solution emphasizing social and economic stability over military action, the selection of a hawk like Holbrooke is ill-advised. Not only has he demonstrated a lack of comprehension when it comes to the complex reality of Afghanistan (not to mention Pakistan), Holbrooke has a history of choosing the military solution over the finesse of diplomacy. The Dayton Accords, after all, were built on the back of a NATO military presence. This does not bode well for the Obama administration.
It is highly doubtful that Holbrooke will bring anything more to the table than cheerleading. President Obama's stated intention to increase the size of the U.S. military presence in Afghanistan and to more forcefully assert U.S.-imposed "security" through continued military action in the Northwest Frontier of Pakistan is a dangerous scheme, one Holbrooke will enthusiastically support. Reinforcing failure is never a sound solution. Take it from the veteran British military officers who have served in Afghanistan and now advise that there is no military solution to the Afghan problem. Listening to advice like that would go a long way toward developing stability in Afghanistan and Pakistan and neutralizing al-Qaida's ability to organize and operate in those nations. The British recognize that the Taliban is not the problem, but rather part of the solution to what ails Afghanistan.
There will be no peace without a negotiated settlement that includes the Taliban. To accomplish this, leadership is required which recognizes the Taliban as a force of moderation, and not extremism. Holbrooke does not have a record which indicates he would be willing to consider direct negotiations with the Taliban. He tends to seek military solutions to difficult ethnic-based problems, and he is likely to argue for the deployment of even more U.S. troops to that war-ravaged nation. That would be a historic mistake.
Instability within Afghanistan continues to bleed over into Pakistan. As the United States pushes for a more effective military solution, there will be even greater pressures placed on U.S. leadership to become directly involved in Pakistan. The recent events in Mumbai, where Pakistani-based terrorists killed scores of innocent civilians, only underscore the inherent instability of Pakistan, which is fighting its own internal struggle against the forces of Islamic fundamentalism. Increased American military operations against Taliban and al-Qaida forces operating inside Pakistan will be a direct result of any increased U.S. military presence in Afghanistan. Such military operations will only increase the influence of Islamic fundamentalists inside Pakistan, while doing little to halt the efforts of the Taliban inside Afghanistan.
The radicalization of Pakistan has potentially disastrous implications for Pakistani-Indian relations. There is already increased talk about the possibility of war between these two nuclear-armed regional powers. Any conflict between India and Pakistan, nuclear or not, brings with it the likelihood of a breakdown of central authority within Pakistan, and would even further empower radical Islamic fundamentalists. That would bring the possibility that sensitive nuclear material, up to and including a nuclear device, would fall into their control. Such an outcome is the stuff of nightmares.
The cause-and-effect relationship between what the United States does inside Afghanistan and what occurs inside Pakistan cannot be ignored by American policymakers. As such, the goal of any U.S. special envoy to the region should be to stabilize the internal Afghan situation and de-emphasize cross-border military operations into Pakistan. Any effort which embraces the Taliban as part of a new Afghan reality would, by extension, eliminate the need to strike Taliban strongholds inside Pakistan. With the Taliban co-opted as a part of the central Afghan government, the forces of al-Qaida would lose their effectiveness, as any effort to continue to fight in Afghanistan would invariably pit them against their former allies. Reduction of hostilities in Afghanistan would create a similar reduction in hostilities in the Northwest Frontier of Pakistan. This in turn would result in a reduction of events which could be used by fundamentalists to justify radical behavior. And a reduction in radical Islamic fundamentalism would in turn allow for a more stable, moderate Pakistani government operating in a manner not only conducive to peace in Afghanistan but also peace with India and the entire region.
To embrace such a policy, the United States needs to contract the services of a U.S. special envoy capable of visionary thinking, one who possesses the political courage to stand up to a president and a secretary of state and argue against bad policy. I do not believe Holbrooke is such a man. As a result, I fear that the Obama administration will find the situation in Afghanistan and Pakistan continuing to deteriorate to the detriment of American national security, and will increasingly waste time and energy in a period of so many problems at home and abroad. Afghanistan does not need to be one of these problems, but the selection of Richard Holbrooke as U.S. special envoy bodes ill for the prospect of lasting peace and security in a volatile region.
Scott Ritter, a U.N. weapons inspector in Iraq from 1991 to 1998, is the author of "Waging Peace: The Art of War for the Antiwar Movement" (Nation Books, 2007) and "Target Iran."
[Baca]
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[Baca]
15 January 2009, Online Journal
Fresh from revelations, reported by WMR, that Israel’s Mossad and Chabad House-based criminal syndicates were targets in a criminal gangland retribution attack by a notorious Muslim gang in Mumbai, comes word that Mossad has, once again, been implicated in an intelligence and criminal network, this time in Turkey.
What makes this latest example of Israel’s failure to stem the criminal activities of its intelligence service and criminal syndicates worse is that Turkey, unlike Israel, is a NATO ally of the United States and, therefore, the United States is bound by treaty to protect NATO allies from aggression by non-NATO states, including Israel.
The Turkish and other Middle East media are reporting that the Mossad has been fingered in connection with a right-wing Turkish criminal and intelligence gang, known as Ergenekon, that stands accused of attempting to overthrow Turkey’s democratically-elected Justice and Development (AKP) Party of Prime Minister Recep Tayyip Erdogan and President Abdullah Gul. Several Turkish papers have named a Turkish rabbi, Tuncay Guney, aka Daniel T. Guney and Daniel Levi and code-named “Ipek” or “Silk,” as having served as a double agent for the Turkish National Intelligence Organization (MIT) tasked with infiltrating the shadowy but powerful “state within a state” group Ergenekon. Guney had been arrested by Turkish authorities in 2001 for distributing fake drivers’ licenses and phony license plates for luxury cars. A document recently uncovered by the Turkish press revealed that Guney had also infiltrated a police intelligence unit (JITEM) working with Ergenekon to destabilize Turkey. Guney was exfiltrated to the United States and he now heads up the B’nai Yaakov Synagogue and Community Center in Toronto, Canada. Guney has denied that he has been an agent for Israel, Turkey or the United States but the MIT has confirmed the document identifying Guney as an agent for MIT is authentic.
The Turkish daily Hurriyethas reported that Guney served in MIT’s Counter-terrorism Unit (CTU) and in the MIT unit that monitors Iran. Hurriyet also reported that Guney had developed a contact at the Iranian consulate in Istanbul, Muhsin Karger, the consulate’s political affairs undersecretary.
Guney also has claimed to be a journalist and it is also alleged that he was a member of the PKK. Silvyo Ovaydo, the leader of the Turkish Jewish community, called Guney a fraudulent rabbi and said he was not even registered as a rabbi at the B’nai Yaakov synagogue in Toronto. Guney is said to have once worked for Islamist media organizations in Turkey but suddenly converted to Judaism and became an “instant rabbi” in Toronto.
At the heart of the Ergenekon story lies Mossad and its reported attempts to turn Turkey into another Lebanon or West Bank/Gaza, a country wracked by internal strife and constant warfare that would usher into power a strong right-wing military dictatorship. In the trial of one of the accused murderers of Turkish-Armenian journalist Hrant Dink, the lawyer for one of the accused murderers asked another accused murderer, Erhan Tuncel, a one-time police informer like Guney, if he had an Israeli girlfriend. Tuncel refused to answer the question, citing an invasion of his privacy. However, it was clear that what the lawyer was driving at was a Mossad connection to the murder of Dink, a murder that was being pinned on Turkish anti-Armenian nationalists by the corporate and heavyily Israeli Lobby-influenced media in the West.
When 89 suspects were named in a 2,455-page indictment by a criminal court in Istanbul last July, many retired Turkish army officers, the neocon network, especially in Washington, which is their major citadel, along with Jerusalem and London, began to throw cold water and the term “conspiracy theory” around charges in the Turkish indictment that Ergenekon played a major role in the formation of several Turkish terrorist groups to disrupt Turkish politics, including the illegal Kurdistan Workers’ Party (PKK), Turkish Hizbollah (Party of God), the Marxist-Leninist People’s Liberation Party/Front (DHKP-C), and the little-known Islamic Great East Raiders Front (IBDA-C). The neocon Jamestown Foundation in Washington called the indictment’s links between Turkish military elements and radical terrorists a “conspiracy theory.” Organizations like Jamestown have no other choice. If it were also proven, as it was in Turkey, that various terrorist groups like “Al Qaeda,” “Deccan Mujaheddin,” and others exist courtesy of the nurturing and support by American, Israeli, and other Western military-intelligence structures, groups like Jamestown would lose their reasons for existence — to make propaganda and receive funding in order to keep the terrorist bogeymen, the actual “Emmanuel Godsteins,” alive.
Guney is reported to be the 86th suspect in the indictment of Ergenekon. Guney is believed to have revealed the initial detailed information on the existence of Ergenekon in order to avoid being charged in the case.
The involvement of extreme right-wing Turkish military and intelligence officials and Turkish organized crime networks, with Mossad and, possibly, CIA agents acting in concert with a suspected CIA-funded Turkish Islamic charismatic madrassaand Islamic centers’ chief named Fethullah Gulen — whose activities parallel pan-Turkic/Eurasianist (re: George Soros) goals of Ergenekon — is similar to the scenario now playing out in India where a little known group called “Deccan Mujaheddin” may have been created as a ruse by Indian right-wing military and intelligence officers, allied with Mossad and CIA agents, to sow discord in India and bring about a right-wing Bharatiya Janata Party-Shiv Sena Hindu government.
Gulen owns a number of media and business interests in Turkey and runs Islamic centers throughout central Asia and even in Russia.
In polls, some one-third of the Turkish public believe Islamist Nurcu sect charismatic leader Grand Hodja Fethullah Gulen, who lives in Pennsylvania, is part of a movement that aims to seize control of the Turkish state and a little over a third believe that Gulen is funded by “international powers.” After he was acquitted in Turkey of attempting to overthrow the secular state with his religious organization, Gulen was first denied a Permanent Resident Card or “Green Card” to remain in the United States by the U.S. Distrrict Court for the Eastern District of Pennsylvania but then an appeals court granted Gulen a Green Card. In October of this year, a federal appellate court found that U.S. immigration authorities improperly rejected Gulen’s request for a Green Card. The appeals court ruled that Gulen was “an alien of extraordinary ability,” a decision that saw approval of Gulen’s residency status. Observers of the case suspect the CIA intervened with the court on Gulen’s behalf. Gulen’s support for the AKP government may be an insurance policy by the CIA to maintain a close relationship with the “Islamist tendency” AKP government in Ankara. The Bush administration, after seven years of trying to deport Gulen to Turkey, suddenly dropped its opposition to his permanent residency status.
The public prosecutor in the U.S. Citizenship and Immigration Service (USCIS) case against Gulen’s permanent residency status argued in filed documents that Gulen’s movement was financially supported by Saudi Arabia, Iran, the Turkish government, and the “Central Intelligence Agency.” The deposition stated that some Ankara businessmen donated up to 70 percent of their income to Gulen’s movement.
If Gulen’s operations are funded by the CIA that means the “Agency” may be linked to Ergenekon. With the U.S. having a mutual defense treaty with Turkey’s recognized government that puts the CIA potentially in violation of U.S. law. And Israel’s connections with Ergenekon means that the United States is bound by treaty to protect its ally Turkey from Israeli covert or overt aggression.
There is an element of “McCarthyism” in the Ergenekon case. Some well-meaning officials have been subjected to being tainted by the broad brush of being associated with Ergenekon. One is Asil Serdar Sacan, the former head of the Istanbul organized crime department, who was the first to confiscate documents on Ergenekon in 2001 and broadened his investigation to include both Ergenekon and the Gulen organization. Sacan, who investigated the murder of Turkey’s “King of Casinos” Omer Lutfu Topol, successfully beat attempts to smear him, being acquitted of 36 criminal charges brought against him and being reinstated six times to his police position. Sacan is currently in jail as an Ergenekon suspect but his only “crime” appears to have exposed Guney as a possible triple agent for the MIT, Mossad, and CIA. In 2001, Guney was spirited out of Turkey thanks to an agreement between MIT’s undersecretary Senkal Atasagun and the CIA. Guney was given a 10-year U.S. visa thanks to the CIA’s intervention.
In fact, Ergenekon and its “deep state” players in Turkey and Shiv Sena and its extremist Hindu “deep state” allies in India, backed by elements of Mossad and the CIA, appears to be a replay of the CIA’s secret “Gladio” network in Europe that placed weapons caches in the hands of fascists and neo-Nazis groups to take up arms in the event of a Soviet invasion of Western Europe.
The use of “false flag” terrorist attacks in Western Europe by Gladio units were blamed on Communists in an effort to forestall Communist-Socialist coalition governments in Western Europe, particularly in Italy and France.
Similarly, Ergenekon stands accused of inciting conflicts between Turks and Kurds to create anarchy in the country with the aim of having Ergenekon seizing control of the Turkish government and re-cementing close ties with the United States and Israel.
In 2004, Ergenekon attempted three military coups against the AKP government. They were code-named Eldiven (The Glove”), Sarikiz (“The Blond Girl”), and Ayisigi (“Moonlight’).
Ergenekon has been cagily kept off the newspaper pages and TV news screens in the United States. To investigate Ergenekon and Gulen in Turkey is to peel away at an onion that could expose some other “unpleasantness” for certain quarters.
On January 10, 2007, WMR reported: “According to Federal law enforcement sources, two influential businessmen — Turkish Sunni Muslim Fetullahci charismatic leader Fetullah Gulen, who lives in Pennsylvania after being acquitted in Turkey in 2006 of plotting against the secular republic, and Saudi BMI Islamic investment chief investor Yasin Qadi, a major investor in Turkey who was named in October 2001 by President Bush as a Special Designated Global Terrorist — were both involved with the CIA in the late 1990s in funneling weapons and other support to the Kosovo Liberation Army (KLA), an Albanian terrorist group operating in the former Yugoslavia. The KLA was allied with the Clinton administration and supported by leading neocons such as Richard Perle, whose lobbying firm, International Advisers, Inc., counts Turkey as its major client. Gulen’s books have been translated into Albanian. BMI’s founder, Soliman Biheiri, also helped to start PTech, a Braintree, Massachusetts-based firm that had active software contracts with the Federal Aviation Administration (FAA) and Pentagon on 9/11. PTech’s offices were raided by federal authorities in December 2002 after it came under suspicion for terrorist financing. Qadi is suspected of using a series of northern Virginia-based businesses and charities to fund ‘Al Qaeda’ activities in Bosnia. Osama Bin Laden was granted a special passport by the Bosnian government in 1993. Qadi was reportedly a business partner of Turkish businessman Cuneyd Zapsu, an adviser to the Prime Minister Recep Tayyip Erdo?an’s Justice and Reconciliation Party (Adalet ve Kalkinma Partisi, AKP).”
The dramatic revelations about Ergenekon coming out of Turkey also points to the reasons why the neocons in Washington were keen to stymie the work of FBI Turkish translator Sibel Edmonds and the CIA’s non-official cover agent Valerie Plame Wilson, both of whom had smuggling and other activities in Turkey high on their priority lists. On January 18, 2008, WMR reported: “WMR has learned that former CIA covert agent Valerie Plame Wilson, whose covert status was leaked by the Bush White House, and former FBI translator Sibel Edmonds, who was focused on a major covert network involving Turkish, Israeli, and key members of the Bush administration and Republican Party and weapons and drug smuggling, were essentially looking at the same network. The nexus of Turkey with both the covert CIA Brewster Jennings and Associates operations and the Turkish-Israeli network of influence active within the Defense and State Departments, is the key factor in understanding the complicated counter-espionage operation conducted by both the FBI and CIA.” It now appears that the Washington-connected criminal network being looked at by Edmonds and Plame was, in fact, closely linked to the Ergenekon network in Turkey.
WMR’s January 18, 2008 report continued: “Special Counsel Patrick Fitzgerald was also, according to our sources, well aware of the massive conspiracy to cover-up the smuggling of weapons of mass destruction components from former Soviet Central Asian states, as well as Ukraine, Moldova, and Ukraine, to the international weapons bazaar. The Abdul Qadeer Khan (A Q Khan) network based in Pakistan was a major beneficiary of the weapons smuggling operation that used Turkey as a pass-through. Rather than expand his investigation, Fitzgerald demurred on looking at the activities of the American Turkish Council, Turkey’s influential lobbying group in Washington, and its parallel symbiotic organization, the American Israel Public Affairs Committee (AIPAC). Turkey and Israel are close military and intelligence partners.”
Illinois Democratic Senator Dick Durbin has called on President-elect Barack Obama to reappoint Fitzgerald as U.S. Attorney for Northern Ilinois. If Obama does so, it means that the network being investigated by Edmonds and Plame, one that stretches to Ergenekon and the Gulen network in Turkey, has its hooks deep into the future Obama administration.
http://onlinejournal.com/artman/publish/article_4087.shtml
[Baca]
24 January 2009, The Guardian
Rory McCarthy reports from Gaza City on the individual stories of some victims and the physical and psychological toll on an estimated 350,000 youngsters
Amira Qirm lay on a hospital bed today with her right leg in plaster, and held together by a line of steel pins dug deep into her skin. For several days after her operation Amira, 15, was unable to speak, and even now talks only in a low whisper.
In her past are bitter memories: watching her father die in the street outside their home, then hearing another shell land and kill her brother Ala'a, 14, and her sister Ismat, 16, and then the three days that she spent alone, injured and semi-conscious, trying to stay alive in a neighbour's abandoned house before she could be rescued last Sunday.
Ahead of her, she has a long recovery. First there is an imminent flight to France for the best possible medical treatment, many more operations and then months of rehabilitation and psychiatric care.
Only now, after most of the dead have been buried, is the first properly researched reckoning of the toll emerging. What already stands out is the striking cost borne by the children of Gaza, who make up more than half of the 1.5 million people living in this overcrowded strip of land.
The Palestinian death toll after three weeks of Israel's war was 1,285, according to the Palestinian Centre for Human Rights, or 1,268, according to the al-Mezan Human Rights Centre. Among those dead were at least 280 children.
The impact will be felt by many more for years to come. Among the more than 4,000 people injured more than a quarter were children, some left with severe disabilities. The Gaza Community Health Programme estimates that half Gaza's children – around 350,000 – will develop some form of post-traumatic stress disorder.
Amira Qirm, who lived in Tel al-Hawa, the scene of some of the heaviest fighting in Gaza City, is among the few in line to receive medical treatment abroad.
Already she has a dream to fulfil once she returns to Gaza. "I want to be a lawyer," she said today , "and to stand in court facing the Israelis for what they have done."
Most of the other children will have to make do with treatment in Gaza. Last week some psychologists were walking through the ruins of a house in Atatra, talking to a boy from the Abu Halima family who had lost his father, three brothers and an infant sister in a horrific fire after an Israeli phosphorus shell hit the house.
"The problem is they are not feeling safe even in their own homes, on the streets, in the mosques," said Ehassan Afifi, the psychologist. "This boy is seeing what happened as if it is an endless movie. The physically affected can be operated on, sometimes cured. But these mental problems may lead to problems for the rest of their lives."
Israel has consistently rejected international criticism that its forces used excessive and indiscriminate firepower.
Asked about the criticisms, the prime minister, Ehud Olmert, said in an interview yesterday in the Israeli paper Ma'ariv that the mental health of the children of southern Israel had suffered in recent years. He added: "So now there is talk about Israel's cruelty. When you win, you automatically hurt more than you've been hurt. And we didn't want to lose this campaign. What did you want, for hundreds of our soldiers to die? That, after all, was the alternative."
On the Israeli side 13 died in this conflict, three of them civilians. In total in the past eight years, 20 people in Israel have died from rocket and mortar attacks launched by militants in Gaza.
Halting this rocket fire was Israel's primary goal and for the last few days, at least, it has achieved its aim.
But Eyad al-Sarraj, a prominent psychiatrist who leads the Gaza community health programme, said that years of violence in Gaza had only fostered radicalism among its young people, who have seen their fathers humiliated and now left defenceless.
His organisation is training 1,000 ¬people to spread out across Gaza to offer help with grief and mourning and to pass serious cases on to professional therapists.
Already there were reports, he said, of children bed-wetting, stuttering, falling mute, having trouble sleeping, becoming violent or restless and losing their appetites.
The difference between this war and the uprisings, like the first intifada of the late 1980s, was that whereas there was once a frontline, with tanks near the border, now the bombing and artillery reached deep inside Gaza's urban areas and into the homes of ordinary families. "Yes, we have developed a coping strategy but we are still frightened of the Israelis doing this again and again," said al-Sarraj.
"The devastation is a reminder of what the Israelis will do. You need to give children a protective environment and give a chance to the fathers to regain their status as protectors and providers by giving them jobs and homes to live in … This is a massive, man-made disaster and we have to tackle the results."
[Baca]
25 January 2009, Information Clearinghouse
My three-year-old son Sammy walked into my room uninvited as I sorted through another batch of fresh photos from Gaza.
I was looking for a specific image, one that would humanise Palestinians as living, breathing human beings, neither masked nor mutilated. But to no avail.
All the photos I received spoke of the reality that is Gaza today - homes, schools and civilian infrastructure bombed beyond description. All the faces were either of dead or dying people.
I paused as I reached a horrifying photo in the slideshow of a young boy and his sister huddled on a single hospital trolley waiting to be identified and buried. Their faces were darkened as if they were charcoal and their lifeless eyes were still widened with the horror that they experienced as they were burned slowly by a white phosphorus shell.
It was just then that Sammy walked into my room snooping around for a missing toy. "What is this, daddy?" he inquired.
I rushed to click past the horrific image, only to find myself introducing a no less shocking one. Fretfully, I turned the monitor off, then turned to my son as he stood puzzled. His eyes sparkled inquisitively as he tried to make sense of what he had just seen.
He needed to know about these kids whose little bodies had been burned beyond recognition.
"Where are their mummies and daddies? Why are they all so smoky all the time?"
I explained to him that they are Palestinians, that they were hurting "just a little" and that their "mummies and daddies will be right back."
The reality is that these children and thousands like them in Gaza have experienced the most profound pain, a pain that we may never in our lives comprehend.
"I think that Gaza is now being used as a test laboratory for new weapons," Mads Gilbert, a Norwegian doctor who had recently returned from Gaza told reporters in Oslo.
"This is a new generation of very powerful small explosives that detonates with extreme power and dissipates its power within a range of five to 10 metres
"We have not seen the casualties affected directly by the bomb, because they are normally torn to pieces and do not survive, but we have seen a number of very brutal amputations."
The dreadful weapons are known as dense inert metal explosives (DIME), "an experimental kind of explosive" but only one of several new weapons that Israel has been using in Gaza, the world's most densely populated regions.
Israel could not possibly have found a better place to experiment with DIME or the use of white phosphorus in civilian areas than Gaza.
The hapless inhabitants of the strip have been disowned. The power of the media, political coercion, intimidation and manipulation have demonised this imprisoned nation fighting for its life in the tiny spaces left of its land.
No wonder Israel refused to allow foreign journalists into the tiny enclave and brazenly bombed the remaining international presence in Gaza.
As long as there are no witnesses to the war crimes committed in Gaza, Israel is confident that it can sell a fabricated story to the world that it is, as always, the victim, one that has been terrorised and, strangely enough, demonised as well.
The Jerusalem Post quoted Israeli Foreign Minister Tzipi Livni on January 15.
"Livni said that these were hard times for Israel, but that the government was forced to act in Gaza in order to protect Israeli citizens.
"She stated that Gaza was ruled by a terrorist regime and that Israel must carry on a dialogue with moderate sources while simultaneously fighting terror."
The same peculiar message was conveyed by Israeli Prime Minister Ehud Olmert as he declared his one-sided ceasefire on January 17.
Never mind that the "terrorist regime" was democratically elected and had honoured a ceasefire agreement with Israel for six months, receiving nothing in return but a lethal siege interrupted by an occasional round of death and destruction.
Livni is not as perceptive and shrewd as the US media fantasises. Blunt-speaking Ehud Barak and stiff-faced Mark Regev are not convincing men of wisdom. Their logic is bizarre and wouldn't stand the test of reason.
But they have unfettered access to the media, where they are hardly challenged by journalists who know well that protecting one's citizens doesn't require the violation of international and humanitarian laws, targeting medical workers, sniper fire at children and demolishing homes with entire families holed up inside. Securing your borders doesn't require imprisoning and starving your neighbours and turning their homes to smoking heaps of rubble.
Olmert wants to "break the will" of Hamas, i.e. the Palestinians, since the Hamas government was elected and backed by the majority of the Palestinian people.
Isn't 60 years of suffering and survival enough to convince Olmert that the will of the Palestinians cannot be broken? How many heaps of wreckage and mutilated bodies will be enough to convince the prime minister that those who fight for their freedom will either be free or will die trying?
Far-right politician Avigdor Lieberman, a rising star in Israel, is not yet convinced. He thinks that more can be done to "secure" his country, which was established in 1948 on the ruins of destroyed Palestinian towns and villages. He has a plan.
"We must continue to fight Hamas just like the United States did with the Japanese in World War II," said the head of ultra-nationalist opposition party Yisrael Beitenu.
A selective reader of history, Lieberman could only think of the 1945 atomic bombs dropped on Nagasaki and Hiroshima. But something else happened during those years that Lieberman carefully omitted. It's called the Holocaust, a term that many are increasingly using to describe the Israeli massacres in the Gaza Strip.
It is strange that conventional Israeli wisdom still dictates that "the Arabs understand only the language of force." If that were true, then they would have conceded their rights after the first massacre in 1948. But, following more than 60 years filled with massacres new and old, they continue to resist.
"Freedom or death," is the popular Palestinian mantra. These are not simply words, but a rule by which Palestinians live and die. Gaza is the proof and Israeli leaders are yet to understand.
My son persisted. "Why are Palestinians so smoky all the time, Daddy?"
"When you grow up, you'll understand."
Ramzy Baroud ( www.ramzybaroud.net ) is an author and editor of PalestineChronicle.com. His work has been published in many newspapers, journals and anthologies around the world. His latest book is, "The Second Palestinian Intifada: A Chronicle of a People's Struggle" (Pluto Press, London).
[Baca]
23 January 2009, Federated Equity Management Company
From the Financial to the Real …
As the “financial’’ crisis moved into the “real” economy at the end of 2008, the incomprehensible discourse about arcane minutiae of securitized debt and derivatives (toxic three letter acronyms such as ABS, CDO, MBS, SIV; CDS etc,) that no sane person really understood, could be abandoned for the more familiar language of “recessions” and “depressions.” Familiarity, no matter how terrible, is comforting.
Commentators and pundits, generally with books to promote, jostled for position to proclaim that this was the “worst crisis’’ since, well at least, the ‘‘last worst crisis.’’ A new three letter acronym – GFC (Global Financial Crisis) – gained currency. The real causes of the crisis, its continued evolution and, most crucially, the solution remained elusive. As John Kenneth Galbraith observed: “Between human beings there is a type of intercourse which proceeds not from knowledge, or even lack of knowledge, but from failure to know what isn’t known. This is true of much of the discourse on the market.”
2008 – Look Back with Horror!
In the financial carnage of 2008, the value of financial assets fell to such depths that shell-shocked investors needed specialized diving equipment just to find what anything was worth.
Shares (both developed and emerging market), residential and commercial property, credit investments and commodities all fell sharply in value. Defensive assets (traditional widows and orphans stocks and high quality corporate bonds) fell. Alternative assets (private equity and hedge funds) that were meant to perform differently to other asset classes and diversify investment portfolios also fell. Only “boring” investors who presciently owned government bonds or “lucky” shorts who had short-sold everything else registered positive returns.
Volatility reached astonishing levels. Correlation between asset classes hovered close to one as all prices moved in unison, mimicking gold-medal winning synchronized divers. An investment in a Zambian copper mine behaved almost identically to a bond issued by a high quality corporation in Scandinavia.
What the “geeks bearing Greeks” and their quantitative investment models, risk analysis and trading strategies made of all this is unknown.
The Great Deleveraging …
Fundamentals of value were largely irrelevant as the “great deleveraging’’ (surely the financial word of 2008) dominated. In recent years, cheap and abundant money (mainly borrowed) drove up the value of other assets. As the debt in the financial system was contracted, money became scarce and expensive, triggering a sharp fall in asset prices. Anybody who had borrowed to purchase financial assets had to stump up margins or were forced to sell to reduce debt.
A shortage of buyers and lack of available liquidity meant that generally selling risky assets was nigh impossible. The marginal seller, usually distressed, and the cash-rich buyer, increasingly scarce, set market prices. Central banks and governments, depending on the plan du jour to save the world, were “buyers of last resort.”
The process is far from complete. Many hedge funds put off liquidating positions taking refuge behind “gates” – the new buzzword for suspending redemptions to prevent hapless investors taking out their vanishing investment capital.
The hope was that markets would miraculously improve in the New Year (I think it was 2009 that they were referring to but am not sure!).
On Life Support …
The health of the financial system and the extent of the slowdown in the real economy remain keys to economic stability and recovery. Banks continue to be on shaky life support. Further losses, more bank failures, a bleak earnings outlook and difficulties in raising equity and funding mean that state led “no bank left behind” support programs continue to be necessary for survival. The creeping nationalization of many banking systems is probable.
The cost of money rose and availability reduced. As Mark Twain observed: “A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.’’ “Loan” and “debt” are now four letter words.
Substantial losses in investment portfolios of insurance companies, pension funds, asset managers and endowments will emerge. A combination of investor redemptions and unavailability of leverage will result in gradual liquidation of a significant portion of the hedge fund industry.
The sharp decrease in debt levels is driving reduction in growth pushing most major economies into recessions or near recessions.
The financial headlines scream “deleveraging” at every turn. Companies are cutting production, reducing staff and costs, suspending investment plans, raising equity and trying to sell assets to reduce debt. Consumer spending is falling sharply as individuals increase savings and reduce debt. Falling investment earnings and lower interest rates also adversely affect the income of savers reducing consumption. Increasing unemployment (as companies retrench) and lower investment (as global demand collapses) mean the chance for a quick recovery is receding.
U.S. employment statistics are bleak with the rate of job losses now running at around 500,000 per month. The state of Ohio reported receiving 80,000 calls per day for unemployment claims (versus a normal 7,500 per day). Ohio indicated that it needed to hire temporary staff to handle the volumes of unemployment claims – surely an unproductive employment scheme. The problem of rising unemployment is now a global phenomenon.
Emerging markets have not “decoupled.” China and India have slowed dramatically. Russia, Brazil and the Gulf are also facing a slowdown as commodity prices fall sharply in the face of slower global growth. Global trade is also slowing.
There is renewed concern about emerging markets, especially in Central and Eastern Europe (“CEE”), Latin America and Asia. The fundamentals of the CEE economies are not dissimilar to the position of the Asian economies in the period immediately before the 1997/1998 crisis. European banks have large exposures to emerging markets in CEE, Latin America and Asia. “It’s deja-vu all over again” as Yogi Berra might have said.
The deleveraging may claim further casualties. Companies that have taken on debt to finance acquisitions will face challenges in refinancing debt. Many private equity transactions, undertaken on aggressive terms, may be unable to service its debt commitments and will need to be restructured or will default. More than 71% of debt outstanding in 2008 was rated non-investment grade. This compares with less than 30% as at 1980 and less than 50% as at 1990.
We are all Keynesians Now!
The markets are placing considerable reliance on the ability of governments to arrest the decline and restore the global economy’s health.
Central banks have flooded money markets with liquidity. The money unsurprisingly is not flowing through into the economy.
Banks are stockpiling the cash or using it to purchase government bonds. The money is needed by banks to finance around $5 trillion to $10 trillion of assets that are returning to bank balance sheets from the off-balance “shadow banking” system. Banks also need to refinance substantial amounts of maturing debt and finance corporations who are drawing down credit facilities. Banks are reluctant to lend as the real economy slows with rising unemployment and lower corporate earnings. They also lack the risk capital to make loans.
Central banks, in some countries, have moved to recapitalize the banks and have guaranteed bank borrowings. This provides the banks with expensive capital and funding. It is difficult to see that these steps will be sufficient to arrest a sharp decline in the balance sheets and credit creation capacities of banks.
Governments are resorting to lower interest rates and massive spending initiatives to stimulate growth. It seems we are all Keynesians now!
But the experience of Japan is salutary. Zero interest rates and repeated doses of fiscal medicine have not restored the health of the Japanese economy that remains mired in a form of suspended animation. The rest of world is struggling to avoid “turning Japanese.”
In 2008, aware of the massive deleveraging of the financial system, credit markets bought government bonds anticipating slower growth and lower interest rates. Equity markets, at least initially, viewed lower rates as supporting growth and to corporate earnings. By late 2008, equity markets saw low rates as symptomatic of low growth prospects and declining corporate earnings. Equity market did not react positively to the announcement from the U.S. Federal Reserve that it will adopt a zero interest rate policy. Equities remained weak even as interest rates continued to decline.
Corporate bailouts are all the rage. The financial sector has prompted others to get into the queue − carmakers are apparently now banks! Larry Flynt (founder of Hustler magazine) and Joe Francis (creator of “Girls Gone Wild” videos) are – tongue in cheek – seeking $5 billion to bailout the adult entertainment industry where revenues are falling. Flynt reportedly stated that “Americans can do without cars and such, but they cannot do without sex.”
Government spending has converted a private sector problem into a public sector financing problem. High levels of public debt in and poor fiscal positions of some countries mean that the spending may be difficult to finance. The continued heavy reliance on savers in Asia, Europe and the Middle East is increasingly problematic given emerging problems in these countries that may limit the funds available. At a minimum, the increased issuance of public debt risks crowding out other borrowers.
The problem is most acute for the United States. In late 2008, Akio Mikuni, president of Japanese credit ratings agency Mikuni & Co., suggested that Japan should write-off its holdings of Treasurys because he believed that the U.S. government would struggle to finance increasing debt levels let alone repay the borrowings. He suggested that debt forgiveness was the only way out of the problem.
These pressures have manifested themselves in the currency markets. The last weeks of 2008 saw astonishing volatility in the euro/U.S. dollar rate, which moved between U.S. $1.3356 to U.S. $1.4719 (10.2%) in less than one week.
The risk of deflation (falling prices) is creating another massive asset price bubble in government bonds. Investors concerned about recession and deflation have purchased long maturity bonds, driving long-term interest rates to unprecedented levels. A rate less than 3% per annum for 30-year U.S. government debt appears inadequate compensation for the risk entailed.
From ‘Shock and Awe’ to ‘Trench Warfare’ …
The aggressive reduction in debt globally will result in a sharp reduction in sustainable growth rates. Four to five dollars of debt is required to create $1 of growth.
Approximately half the recorded growth in the United States in recent years was driven by debt, primarily from mortgage equity withdrawals. As the level of debt in the global economy decreases, attainable growth levels also decline.
In effect, the world used debt to accelerate its consumption. Spending that would have taken place normally over a period of many years was squeezed into a relatively short period because of the availability of cheap financing. Business over-invested, misreading the demand and assuming that the exaggerated growth would continue indefinitely creating significant over-capacity in many sectors.
2008 was the year of “shock and awe.” 2009 may well prove to be a year of grim and brutal trench warfare as the world adjusts to a new economic order and reduced expectations.
A lower growth future has political and social implications. China and India are deeply concerned about failing to provide jobs for the millions coming into the workforce each year.
New Investment Mantras …
Investment logic has undeniably changed. Any business model based on the availability of cheap and abundant debt, such as private equity or hedge funds, is now questionable. Anybody with major amounts of debt to refinance in the immediate future or any other financial cash calls (such as margin calls on credit downgrades) will be carefully scrutinized.
In recent years, the value of real and financial assets were driven by a combination of higher earnings from the “great moderation” (strong economic growth and low interest rates) and an expansion of price earning multiples.
During this period, earnings also became “financialized.” Companies relied on financial engineering to boost earnings. Industrial companies boosted profits by financing purchases of their products, acquiring, merging and de-merging, borrowing to share buybacks, or trading in financial instruments. Financial sector profits rose to around 30% to 40% of total corporate profitability.
Prices reflected high termination or or resale values from private equity, hedge funds and share buybacks; that is, a “greater fool” with even greater leverage and more “financial engineering” would come along and buy whatever the investor had bought at an even higher price. All this now is a distant and fond memory that is unlikely to return until collective memory fades and scar tissue heals.
Investors are now focused on cash flows (income or dividends) from the investment. Capital gains have joined the list of endangered species. Prices must equate to the cash flows discounted back at capitalization rates factoring in much higher costs of capital. Valuation fundamentals that Benjamin Graham would have recognized are once again fashionable.
Some of this is already in the price. Nobody knows whether assumed earnings sufficiently factor in the low growth environment ahead or whether the higher costs of capital have been incorporated.
Investment patterns favor debt over equity. Current credit margins are pricing in very high levels of default on high quality debt. Abundance of cheap debt drove down debt margins boosting equity returns. As credit margins increase there is a transfer of value from equity to debt. Potential equity raisings and asset sales as companies deleverage also increase the risk of dilution of equity returns.
The form of investment may also change. Investors want to get as close to the cash flows as possible and avoid complex investment structures. Leveraged investment vehicles are out of fashion. Absolute rather than relative returns will be sought.
Management of the “liability” side of funds, specifically redemption risk, is increasingly important. Investors will be wary of the risk of value erosion in pooled investment structures (such as mutual funds and unit trusts). In 2008, unrelated redemption pressures drove down values of pooled investment and absorbed scarce liquidity. Closed end funds and self liquidating structures may become the new “New thing.’’
Fund manager’s fees will be under pressure. A fee of 1% plus management expenses of 1% for a fund where the returns are negative will not pass muster. The hedge fund standard 2% and 20% of performance will only be acceptable for exceptional managers with a long history of high and stable returns (like Mr. Bernard Madoff) or where the performance fee is paid on realized returns.
We are, of course, in a “new paradigm.” Investors will need to adjust their expectations. The new investment mantras may well be:
1. Flat is the new up.
2. Debt is the new equity.
3. Interest and dividends are the only return.
4. If you’re looking for the bottom of the market there’s a special offer − buy one, you get the next one free.
Keynes famously observed that investment is “anticipating the anticipations of others.” Bill Gross, founder of Pimco, one of the world’s largest investment managers, recently suggested that the best investment strategy may well be to buy whatever it is that the governments of the world will buy up next.
Range Rover to Game Over …
The best investment story of 2008 relates to a banker who had a modest shareholding in his employer – a storied investment bank. Upon being transferred to London, he sold the stock to finance a Range Rover. As business in London turned down, the banker was transferred to Dubai.
When selling his Range Rover, he suffered a loss of around 50% of the price he paid barely six month ago. The interesting thing was that the proceeds from the sale of the car (despite the 50% loss) would have allowed the banker to purchase five times the number of shares he sold to finance the car. 2008 is perhaps the only year on record in which a distressed price for a Range Rover outperformed equities.
In Iceland, where there is an oversupply of Range Rovers as the economic good times ended, the cars are now known as “Game Overs.’’ For investors, 2008 was also a case of game over.
As in Genesis, the “years of plenty” have ended. The improvident wasted the bounty of the years of prosperity and now find themselves in want in the “years of dearth.”
Satyajit Das is a risk consultant and author of a number of key reference works on derivatives and “Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives” (2006, FT-Prentice Hall).
[Baca]
Up to the date of President Obama’s inauguration as the 44th President of the United States, the Prime Minister and the Bank Negara, specifically its Governor have been most optimistic about the Malaysian economy and her ability to withstand the impact of the Global Financial Tsunami.
They made assuring statements that our country’s fundamentals are strong, the banks are well capitalised and the banking system is flushed with liquidity and that the nation has a high savings rate, and as such there was no need for any worries of a recession or worse.
This optimism was echoed by the Asian Strategy and Leadership Institute (Asli). Speaking at the media briefing to release Asli’s bi-yearly report on Malaysia’s Economic Perspectives, Datuk Dr. Gan Khuan Poh was reported by NST as saying that he is confident Malaysia will be able to weather the financial crisis to post a 4 per cent growth this year, surpassing the government’s official forecast of 3.5 per cent. Emerging markets such as Malaysia are standing on their own feet to a greater extent than before, especially after the 1997-1998 Asian financial crisis.
Datuk Gan repeated the same economic mantras previously dished out by the government and Bank Negara – “Strong macro fundamentals, a sound financial system, with about RM180 billion liquidity, low foreign debts, declining inflation and a high savings rate that can be mobilised for domestic consumption.”
Asli’s forecast for 2008 was off the mark and had to revise its original figures downwards from 6.2 per cent to 5.5 per cent. The Asli economic team must be wearing blinkers in 2007.
One can be forgiven for lack of foresight, as not everyone has common sense and or the ability to apply common sense in resolving complex issues. But when a person with the benefit of hindsight still gets it wrong, we have to question the integrity of his findings and motives.
The Prime Minister, Bank Negara and Asli cannot be said to be unaware that even the Fed, Bank of England and the ECB have concluded that the global banking system is utterly broken and almost all major international banks are insolvent and world trade has dived.
Neither can they be excused from not knowing that at the recent confirmation hearings of Timothy Geithner as Treasury Secretary by the US Senate Finance Committee, the following testimonies were proffered. If they were in fact unaware, they have no business commenting on the economy, as their views are totally inconsistent with the stark reality. I invite you to consider the following statements at the said hearing:
Paul Volker: “To put it starkly, we are in a serious recession with no end clearly insight. The financial system is broken. It’s a serious obstacle to recovery…”
Sen John Kerry: “People are fond of saying that we have a crisis of confidence. I don’t believe we have a crisis of confidence. I believe that we have a reality crisis. We have a real crisis in the fiscal reality of our lending institutions…”
Sen Bob Corker: “A Zombie banking system is being created. Large banks are insolvent, and need to be seized. Write-downs must be done. The longer we wait, the further we will be from dealing with the root cause. I talk to bankers on Wall Street. They know they are insolvent. We have to face it like adults. Face up to the insolvency. Face up to these major losses…”
The US is one of Malaysia’s biggest export markets and to say that Malaysia will be able to cope with the crisis because of our strong macro fundamentals is gross irresponsibility. I therefore question the integrity of the findings of Asli’s report. It is misleading and gives a false sense of comfort to the people. It should be flushed down the toilet.
I am now throwing a gauntlet at Asli. I hope that they will take up the challenge. It is a simple challenge – at the end of 2009, if Malaysia’s economy attains Asli’s projected growth of 4 per cent, I will donate RM10,000 to its coffers. If Malaysia fails to achieve the projected growth, Datuk Dr Gan Khuan Poh and Asli must donate the same amount to a charity designated by me.
Put up the money or shut up. Stop misleading the public! This challenge is open for acceptance by Asli within two weeks from the date of posting of this article to my website.
What was most interesting was that on the very day of the publication of the Asli Report, Bank Negara dropped a bombshell – the Overnight Policy Rate (OPR) was reduced by 75 basis points and the Statutory Reserve Requirement was also reduced! What a contradiction!
Just this fact alone will be enough to demolish the stupid conclusion of Asli’s report. I refer once again the rationale of Dr. Gan: “Strong macro fundamentals, a sound financial system, with about RM180 billion liquidity, low foreign debts, declining inflation and a high savings rate that can be mobilised for domestic consumption.”
If there is so much liquidity, there is no need for Bank Negara to reduce its Overnight Policy Rate (OPR) by a massive 75 basis points to 2.5 per cent as well as reducing the Statutory Reserve Requirement (SRR) for banks to 2 per cent from 3.5 per cent effective February 1, 2009. As reported by Business Times on the January 22, 2009 the rationale for the drastic reduction was:
“A reduction in the SRR will inject a certain amount of liquidity into the financial system, allowing the banks to lend more to finance economic activities.”
“Bank Negara said that with Malaysia’s growth prospects under threat, the big reductions in the OPR and the SRR were aimed at being pre-emptive in providing a more supportive environment for the domestic economy.”
If as stated by Asli there was ample liquidity, why was there a need to “inject a certain amount of liquidity”?
The Star newspaper reported as follows:
“The sharper deterioration of the global economy is expected to have a greater impact on the Malaysian economy with the large decline in external demand already seen…”
Additionally, Bank Negara said that, “these developments have also affected labour market conditions. Under these circumstances, the urgent implementation of policy measures will be key towards ensuring the Malaysian economy continues to experience positive growth in 2009.”
For the entire 2007 and 2008, the mantra was “all is well as we will not be adversely affected by the global crisis.” Now it is a matter of urgency for policy measures to be implemented! This is the ultimate flip flop.
The first stimulus plan was presented to the country some months ago. But no one has any idea where the money came from and how it was spent. Agatha Christie could not have come up with a better mystery!
Prime Minister Badawi has recently announced that another stimulus will be implemented, to give more liquidity to the economy.
Tan Sri William Cheng, President of the Associated Chinese Chambers of Commerce reiterated that a second stimulus was needed to avoid a recession and that the focus should be on the manufacturing and the construction sectors, these being the areas most threatened by the global economic crisis. Yet, just a few months ago, the mantra was that there will be no threat of recession!
We have also been assured by Bank Negara that our banks are all adequately capitalised. So how should one make of this news report by The Star dated January 24, 2009?
“Maybank mulls over RM3bil rights issue. It wants to strengthen balance sheet to face tough times ahead.
“The rights issue, the source adds, is one of several options being considered by the bank to boost its capital structure. The bank’s total capital requirement is RM12 bil while it has thus far raised some RM9.1 bil.”
Having to expose the several contradictions of the Government and Bank Negara is getting tiresome but I feel compelled to do so as the mainstream media seem oblivious to these policy twists and turns and happily repeats them so as to assist the government to win a by-election.
The days are long gone when the government can pull the wool over the eyes of the public and seduce them with false promises to win elections.
Barisan Nasional is just so stupid. The people are saying in no uncertain terms – “stop the lies, stop the fairy tales!”
The people have been saying this since the March 2008 General Elections, but the political warlords are just too occupied with power grabs and looting the treasury to bother to listen.
Will Barisan Nasional survive beyond 2010?
At this rate of stupidity and self-denial, the ruling elites will be buried for good by 2010!
[Baca]
Israel has refuted allegations of war atrocities in Gaza after Palestinian children described how their parents had been "executed" by Israeli troops.
January 21, 2009 The Telegraph
One nine-year-old boy said his father had been shot dead in front of him despite surrendering to Israeli soldiers with his hands in the air.
Another youngster described witnessing the deaths of his mother, three brothers and uncle after the house they were in was shelled.
He said his mother and one of his siblings had been killed instantly, while the others bled to death over a period of days.
A psychiatrist treating children in the village of Zeitoun on the outskirts of Gaza City, where the alleged incidents took place, described the deaths as a "massacre".
Rawya Borno, a Jordanian doctor, said civilians, including children, were rounded up and killed by Israeli troops.
Israel has denied the claims, dismissing them as Hamas propaganda, but said that an investigation is being conducted into soldiers' conduct in the area.
In interviews with ITV News, Palestinians claimed that Israeli forces knowingly killed civilians in Zeitoun on the morning of Jan 14.
Abdullah Samouni, nine, described the moment his father was allegedly executed" by Israeli soldiers.
Holding his arms in the air, he said: "He was surrendering like this. My father came out and they shot him right away."
A boy named Ahmed said he was trapped for days in the wreckage of the shelled Samouni family's house.
He said: "My mother was dead beside me, she was clutching my brother Nasser and they were dead. My brother Itzaq was bleeding for two days and then he died. My brother Izmael bled to death in one day. My uncle Talal was bleeding for two hours and he died. God bless them."
Dr Borno said: "It's a massacre. They collected them from their houses. They knew that they were civilians. They were children."
When asked if Hamas had been in Zeitoun, Dr Borno replied: "Suppose that there is one of the fighters around, what is it to do with all these? Is the price to kill the family as a whole? Is this baby carrying a machine gun?"
Israeli spokesman Mark Regev suggested the claims could be Hamas propaganda and said an investigation was under way. However, he said that Israeli troops had reported that Zeitoun was "full of Hamas" militants and that soldiers encountered booby traps in "every house" in the village.
He said: "When people live in an authoritarian regime, when it's clear there is an official message and the message is to give out atrocity propaganda, [then] at least I think we should ask questions.
"Hamas has an interest in sending out this sort of atrocity propaganda.
"What happened in that village is under investigation. I know from speaking to IDF officers that there was very serious combat in that village, that every house was booby-trapped, there were guns. Very difficult military operation.
"If there is any Israeli solder that has done something inappropriate of course that will be discovered and there will be law, but I am very concerned about a situation where children are manipulated, where everyone is on the same message.
"We know that village was full of Hamas fighters. It's against the rules of engagement of the Israeli army to shoot innocent civilians."
[Baca]
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By James Hider in Jerusalem and Sheera Frenkel in Gaza City
|
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Tuesday, 27 January 2009 18:00 |
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January 24, 2009 TimesOnline
The
incident being investigated is believed to be the firing of white
phosphorous shells at a UN school in Beit Lahiya on January 17
After
weeks of denying that it used white phosphorus in the heavily populated
Gaza Strip, Israel finally admitted yesterday that the weapon was
deployed in its offensive.
The
army’s use of white phosphorus – which makes a distinctive shellburst
of dozens of smoke trails – was reported first by The Times on January
5, when it was strenuously denied by the army. Now, in the face of
mounting evidence and international outcry, Israel has been forced to
backtrack on that initial denial. “Yes, phosphorus was used but not in
any illegal manner,” Yigal Palmor, a Foreign Ministry spokesman, told
The Times. “Some practices could be illegal but we are going into that.
The IDF (Israel Defence Forces) is holding an investigation concerning
one specific incident.”
The
incident in question is thought to be the firing of phosphorus shells
at a UN school in Beit Lahiya in the northern Gaza Strip on January 17.
The weapon is legal if used as a smokescreen in battle but it is banned
from deployment in civilian areas. Pictures of the attack show
Palestinian medics fleeing as blobs of burning phosphorus rain down on
the compound.
A
senior army official also admitted that shells containing phosphorus
had been used in Gaza but said that they were used to provide a
smokescreen.
The
Ministry of Defence gave lawyers the task before the attack of
investigating the legal consequences of deploying white phosphorus –
commonly stocked in Nato arsenals and used by US and British forces in
Iraq and Afghanistan – inside the Gaza Strip, home to 1.5 million
Palestinians, and one of the most densely populated places in the
world.
“From
what I know, at least one month before it was used a legal team had
been consulted on the implications,” an Israeli defence official said.
He added that Israel was surprised about the public outcry. “Everyone
knew we were using it, and everyone else uses it. We didn’t think it
would get this much attention,” he said.
Because
Israel is not a signatory to the treaty that created the International
Court of Justice in The Hague, it cannot be tried there. Any country
that is a signatory to the Geneva Convention, however, can try to
prosecute individuals who took part in the Gaza operation as culpable
of war crimes.
Despite
a denial when The Times first reported the use of white phosphorus, an
army spokeswoman said yesterday that the military had never tried to
cover up its deployment. “There was never any denial from the
beginning,” she said.
-
President Sarkozy of France ordered the deployment of a frigate to
international waters off Gaza to patrol against arms smuggling into the
territory. Preventative measures against arms trafficking are one of
Israel’s demands for a peace deal with Hamas. The warship will conduct
surveillance with Egypt and Israel, the French presidency said.
CHANGING TUNE
January 5 The Times reports that telltale smoke has appeared from areas of shelling. Israel denies using phosphorus
January 8
The Times reports photographic evidence showing stockpiles of white
phosphorus (WP) shells. Israel Defence Forces spokesman says: “This is
what we call a quiet shell – it has no explosives and no white
phosphorus”
January 12
The Times reports that more than 50 phosphorus burns victims are taken
into Nasser Hospital. An Israeli military spokesman “categorically”
denies the use of white phosphorus
January 15
Remnants of white phosphorus shells are found in western Gaza. The IDF
refuses to comment on specific weaponry but insists ammunition is
“within the scope of international law”
January 16
The United Nations Relief and Works Agency headquarters are hit with
phosphorus munitions. The Israeli military continues to deny its use
January 21
Avital Leibovich, Israel’s military spokeswoman, admits white
phosphorus munitions were employed in a manner “according to
international law”
January 23
Israel says it is launching an investigation into white phosphorus
munitions, which hit a UN school on January 17. “Some practices could
be illegal but we are going into that. The IDF is holding an
investigation concerning one specific unit and one incident” Source:
Times database
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[Baca]
(On Jan 24, 2009, Hanan commented on Boycott - this is my reply)
Dear Hanan,
1. I agree entirely with you that building a great nation doesn't only take brains, but as you said it sure does help.
2. However brains alone without a heart (feelings) can produce a monster.
3. Israel is undoubtedly a great nation, becoming great through the
brains and the numerous achievements you have listed. Yes I have used
Israeli originated products like Microsoft Windows and Pentium chips
(made in Malaysia) by Intel, an American company.
4.
In fact I owe my life ultimately to Israel because there must be
something invented by Israelis in the numerous instruments used in
heart surgery. However most of the products used were invented and
produced by Japanese.
5. I am amazed at the number of Nobel Laureates Israel has produced. I admit we have not produced even one.
6. But when the brain is without a heart it does not care for the misery resulting from the products of the brain.
7. The atom bombs which killed 100,000 men, women, children and babies
are the product of Israeli (Jewish) brain. Most of the diabolical
weapons now being used to kill millions of people are also the creation
of Israelis on Zionist Jews. The depleted uranium and phosphorous
shells being used in Gaza are also the product of Israeli brains.
8. The current financial crisis which is destroying the economies of
the U.S. Britain and in fact all the countries of the world is due to
manipulations of banks, financial institutions and the monetary system
by Jewish supporters of Israel.
9. The negation of the freedom of speech when it comes to the alleged
killings of Jews in World War II are also inspired by Zionist Jews.
10. But worse of all is the seizure of Palestinian land to create the
state of Israel. Not content with the area given to the Jews by the
United Nations you have seized more Palestinian land, built settlements
on many parts of Palestine, disallowed the use of roads built on
Palestinian land to the Palestinians, erected your own check points at
the borders of Palestine with Jordan and built your version of the
Berlin Wall through Palestinian villages on land that is not part of
Israel.
11. Before the creation of Israel, the Jews and Arabs in Palestine
lived in peace. Historically Jews had always sought refuge in Muslim
countries when the Europeans conducted pogroms against them. This only
stopped after the U.S. offered asylum.
12. All the terrorism that we see today, whether state initiated or by
irregulars, started after the U.S. backed Israel against Arab attempts
to regain their land through conventional wars. Because they were
outclassed in terms of weapons by the U.S, / Israel, alliance, then
only did the Arabs resort to what is called terrorism. The Israeli
response have always been with greater terrorism as is seen in Gaza.
13. I have asked an American what he would do if Texas was given to the
Jews to create the state of Israel. He did not answer. But I believe he
would fight to get back Texas, employing all the weapons at its
disposal.
14. Yet had the United States been willing to create the nation of
Israel in the lands under U.S. control or in the U.S. itself, there
would be no terrorism in Palestine or in the Middle East. There would
be no terrorism in America either because Israel would be wiped out by
the U.S. forces. The world would remain peaceful.
15. The brutality committed by your forces in Gaza is out of all
proportion to the puny rocket attacks by Hamas. That attack was the
result of Israel and the U.S. failing to accept the results of a
properly conducted election.
16. Hamas could only establish their Government in Gaza. But you
blockaded Gaza, denying them food, medicine, power, fuel etc. If you
had not done that I doubt that Hamas would fire rockets at you.
17. Malaysia is well aware that total boycott of Israel is not
possible. We are in fact boycotting American products which is an even
more impossible task. We would not be able to bring America or Israel
down.
18. But what we aim to do is to demonstrate the disgust and the anger
that we feel over the inhumanity of the brainy but primitive peoples of
Israel and America.
19. You can collect Nobel prizes and other prizes but the world will
look down upon you as very primitive people who robbed land through
terror against perfidious British and subsequently used your control
over the world's greatest military power to oppress the people whom you
had robbed.
20. You have nothing to be proud of, unless of course you take pride in being heartless, in being primitive brutes.
21. The only mitigating factor is the presence among Israelis of a
small number who are ashamed of what you have done to the people of
Gaza.
[Baca]
Press Association
Monday, 26 January 2009
Sky News announced today that it was joining the BBC in refusing to broadcast
an emergency appeal for Gaza.
The broadcaster said in a statement that it had informed the Disasters
Emergency Committee (DEC), an umbrella organisation for 13 humanitarian aid
agencies, of its decision.
John Ryley, head of Sky News, said: "The conflict in Gaza forms part of
one of the most challenging and contentious stories for any news
organisation to cover.
"Our commitment as journalists is to cover all sides of that story with
uncompromising objectivity."
The decision comes after BBC Director-General Mark Thompson today defended the
corporation's decision not to broadcast the appeal in spite of more than
10,000 complaints.
He said the BBC was "passionate" about defending its impartiality.
Speaking on Sky News, the channel's head of foreign news, Adrian Wells, said: "Passions
are raised on this story, passions are raised in this country and that is
only a small reflection of the passions raised in the Middle East. And that
is part of the backdrop of why we've made the decision we've made.
"We have to, as an international channel, focus on our primary role and
that is to report the story and not become the story."
Asked why Sky had decided not to broadcast the appeal but Channel 5, for whom
they provide news coverage, will show it, he said: "The dynamics for
Sky News are different. Channel 4, 5 are not international news channels -
they are broad channels showing all sorts of programmes. The dynamics about
what is right for us are different to what is right for them.
"Let me say to those people who might be angry, people who might be
passionate about this, there is no question about Sky's commitment to
reporting the region. We've had our reporters there since the gates of Gaza
opened. There is absolutely no question of Sky viewers not being aware of
the humanitarian crisis."
He said that Sky had "no problem with the good intentions of the DEC
appeal".
Mr Ryley continued in his statement: "We have provided, and we will continue
to provide, extensive coverage from Gaza and from the wider region on the
conflict and its human consequences for people on both sides.
"Our team is on the ground in the region and will continue to cover the story
in the coming days and weeks.
"The absolute impartiality of our output is fundamental to Sky News and its
journalism.
"That is why, after very careful consideration, we have concluded that
broadcasting an appeal for Gaza at this time is incompatible with our role
in providing balanced and objective reporting of this continuing situation
to our audiences in the UK and around the world.
"It is important to state that this decision is not a judgment on the good
intentions of the appeal.
"No-one could fail to be touched by the human suffering on both sides of the
conflict, which has been the focus of much of our own reporting in the
region."
The decision by Sky comes after the BBC came under intense pressure over its
decision not to broadcast the appeal.
More than 10,000 complaints have been received about the BBC decision and it
has been urged by a series of public figures including the Archbishops of
Canterbury and York to reconsider its decision.
A parliamentary motion also urging the BBC to screen the appeal was backed by
more than 50 MPs from across the Commons.
Terrestrial broadcasters ITV, Channel 4 and Five said they would show the
advert from today.
Over the weekend, thousands of people demonstrated against the decision
outside the BBC's Broadcasting House in central London and, last night,
about 50 protesters "occupied" the lobby of BBC Scotland's headquarters in
Glasgow.
The DEC - which brings together several major aid charities including the
British Red Cross, Save the Children and Oxfam - wants the appeal to be
broadcast on TV and radio to help raise millions of pounds for people in
need of food, medicines and shelter following Israel's three-week assault on
the Palestinian territory.
Secretary of State for International Development Douglas Alexander told Sky
News that the BBC was, "a treasured national institution" and that their
coverage of the conflict, in common with Sky's, had been "exemplary".
But he said: "My appeal is a much more straight forward one. People are
suffering right now, many hundreds of thousands of people are without the
basic necessities of life. That for me is a very straight forward case and I
sincerely hope that the British people respond with characteristic
generosity.
He said that the government is today sending armoured cars to Gaza to help the
UN deliver aid and was donating money to the mine clearance effort.
"We are matching our words of concern with practical actions. We are getting
on with the job this week to distribute money on behalf of the British
people to British organisations."
Defending the BBC decision, Mr Thompson said potentially many millions of
people would find out about the appeal through BBC news programmes.
Asked how he could justify refusing a request made on behalf of major
charities such as the Red Cross, Save the Children and Christian Aid, Mr
Thompson told BBC Breakfast: "When they first contacted us they absolutely
acknowledged that the particular nature of what was going on in Gaza might
well cause a problem for the BBC's impartiality.
"Right from the start, the DEC knew because this is not a new policy, the idea
that the BBC would take really quite a strict view about impartiality,
especially in a story as complex and contentious as Gaza and the broader
Israel/Palestine story, that is not news and wasn't a surprise to the DEC
either."
He added that if the situation was the "other way round" and the principal
humanitarian concern was in Israel and not Gaza, the view of the corporation
would be "exactly the same".
He said the BBC understood the "absolutely good intentions" behind the appeal.
Other public figures to criticise the BBC decision include Samantha Morton,
the Golden Glob- winning actress, who said she would never work for the BBC
again if it failed to change its decision.
The advert was not a political message but "about raising money for children
who are dying", she said.
The early day motion to be tabled by Labour's Richard Burden has received the
support of 51 MPs from across the Commons.
Mr Burden, a member of the Commons' International Development Committee, said
he had written to Mr Thompson to press for an explanation for the BBC's
decision, calling those given so far "both unconvincing and incoherent".
"This is not about taking sides in the conflict. It is about providing urgent
help to people in desperate need," he said.
"More than 400 children have died, thousands are homeless and nothing short of
a humanitarian catastrophe is unfolding in Gaza.
"The important thing is to get aid into Gaza. This is recognised by almost
everyone - including the Government. The BBC appears to be the only one who
has a problem seeing this."
[Baca]
By JUDY DEMPSEY
Published: January 26, 2009
BERLIN — Iceland’s
coalition government collapsed Monday, the latest fallout from a global
financial crisis that has sparked angry demonstrations against
governments across Europe.
Brynjar Gauti/Associated Press
Prime Minister Geir Haarde of Iceland at the parliament in Reykjavik on Monday.
Prime Minister Geir Haarde said
he was unwilling to meet the demands of his coalition partners, the
Social Democratic Alliance Party, which had insisted upon getting the
post of prime minister to keep the coalition intact, The Associated
Press reported from Reykjavik, the Icelandic capital.
Last week,
Mr. Haarde called elections for May, bringing forward a vote originally
scheduled for 2011, after weeks of protests by Icelanders angered by
soaring unemployment and rising prices. But Mr. Haarde said he would
not lead his Independence Party into the new elections because he needed treatment for cancer.
Iceland
has been in crisis since the collapse of its banks because of massive
debt in September and October, with its currency, the krona,
plummeting. The country’s commerce minister, Bjorgvin Sigurdsson, quit
Sunday, citing the pressures of the economic collapse, The A.P.
reported.
The demonstrations in Iceland, which have also
demanded the resignation of governor of the nation’s central bank, have
been mirrored elsewhere in Europe.
The Latvian government,
which this month pushed through wage and spending cuts but also tax
hikes in order to cope with the banking crisis, faced demonstrations
that turned into violent riots. Neighboring Lithuania also had to
contend with protesters after the government introduced a package of
austerity measures to protect the financial sector.
In southern
Europe, tens of thousands turned out in the Spanish city of Zaragoza
last week to press the local authorities to deal with soaring
unemployment as the country’s construction and retailing industries are
hit by the global downturn. And in Greece, the government is still
coming to terms with widespread student protests against education
reforms.
In all cases, the demonstrations have had a mix of sentiments — anti-globalization, anti-capitalist and anti-reform.
So
far, Europe’s largest economies, France, Germany and Britain, have been
spared demonstrations. All three governments have introduced huge
stimulus measures aimed at spurring employment and protecting banks.
Regardless
of the outcome, the three countries will face large budget deficits and
higher state borrowing, which economists say will be passed on to
taxpayers. And in the case of France and Germany, the governments could
find it more difficult to introduce bold reforms in a time of recession.
President Nicolas Sarkozy
of France, who had advocated strong state intervention to protect his
country against recession, is thinking twice about introducing a
variety of reforms, especially involving high school education, because
of the fear of demonstrations. Already, Mr. Sarkozy is dealing with
another round of trade union strikes, which started Thursday, to
protest against unemployment.
In Germany, Europe’s biggest economy, Chancellor Angela Merkel’s
coalition government recently pushed through a batch of stimulus
measures worth more than 80 billion euros. These are aimed at curbing
unemployment by providing public money for roads, schools and consumer
car-loan incentives.
But with many German companies already hit
by the global slowdown and desperate to introduce savings and keep
wages down, strikes cannot be ruled out. Lufthansa, the profitable
national airline, has already called warning strikes, with its union
demanding pay raises of more than 10 percent.
Still, despite the
tens of thousands of workers who have been put on shorter working
weeks, the Merkel government has not yet faced massive anti-capitalist
demonstrations.
Instead, Germany’s leftist parties, fighting
bitterly among themselves to gain political mileage during an election
year, are heaping blame on bankers, not the regulatory processes, for
the financial crisis.
Franz Müntefering, the leader of the Social
Democrats, told the Sunday Frankfurter Allgemeine newspaper that while
some bankers were competent, others had “lost track of what they were
doing.”
In Iceland, Foreign Minister Ingibjörg Sólrún
Gisladóttir, head of the Social Democratic Alliance Party, is expected
to start talks immediately with opposition parties in an attempt to
form a new government that would rule until the new elections are held,
The A.P reported.
Ms. Gisladottir said Monday that she won’t seek
to become Iceland’s new prime minister, proposing instead another
member of her party, Social Affairs Minister Johanna Sigurdardottir.
The
prime minister, who was also reaching out to potential prime minister
candidates, told reporters Monday that he hoped a national government,
formed from all of Iceland’s main political parties, could lead the
country until the elections, The A.P. reported.
[Baca]
By Bob Finch
On monday january 12, 2009, the leader of the jews-only state in
palestine ehud olmert revealed to a jewish audience in ashkelon that he
had insisted george bush should tell condoleeza rice to vote against a
united nations’ resolution calling for a ceasefire to the jews’ attack
on gaza. Olmert did not inadvertently humiliate the president of the
united states of america; the secretary of state, condoleeza rice;
congress; and the american people, by divulging this information. On
the contrary. He was boasting about his power to humiliate the
president and thus the american people.
The global Jewish Empire: a global Zionist conspiracy.
There are a handful of commentators in the western world who have been
compiling the evidence that america, the world’s greatest democracy and
military hyper-power, has been taken over by a jewish elite which acts
on behalf of the jews-only state in palestine. America’s ruling jewish
elite’s most well known operatives are the jewish lobby and the jewish
neocons. These israel-firsters have been corrupting the bush regime
into implementing policies which promote the interests of the racist
state even though they have become increasing catastrophic,
economically, militarily, politically, and morally, for america and the
american people. After al qaeda’s attacks on new york and the pentagon,
zionists imported the jews’ decades-old war against terrorism into
america and ever since the bush regime has been implementing this
disastrous zionist doctrine.
Hardline warmongering zionists in the jews-only state, america, and
the rest of the western world, (including most recently, india) have
been setting the global political agenda: an invasion of afghanistan,
an invasion of iraq, an invasion of lebanon, continued ethnic cleansing
of palestinians, and an attack on iran to trigger a regional, perhaps
even a global, war to boost the jews-only state’s military dominance of
the greater middle east.
The mainstream media in the western world is dominated by zionists
who use their paper publications, tv, and films, to issue the most
blatant zionist propaganda which many westerners welcome because of the
disgusting islamophobia in which it is wrapped. Jewish power in america
is now so blatant that jewish extremists are commissioned to publish
articles in the country’s most prestigious newspapers advocating world
war three. It has to be asked: what normal, sane, decent person around
the world wants another world war? The only people insane enough to
demand world war three are hysterical, paranoid, warmongering, jews.
The irony of the politically kosher worldview which pervades the
western world is that the jewish propagandists who go out of their way
to ridicule the idea of a global jewish conspiracy are themselves
advocates of a global islamic conspiracy. In this hollywood concoction
al quaeda, osma bin laden, hezbollah, hamas, iran, saddam’s iraq, etc,
etc, have all been secretly working together to exterminate the jews
and overthrow western civilization. Such fantastic drivel is being
spewed out solely to cover up the global jewish conspiracy.
Any decent, open-minded, person observing geopolitics since the
foundation of the jews-only state in palestine, would have been all too
well aware of the way that america has been colonized by jewish
neocons. What is so remarkable about this feat is not so much that a
tiny minority could colonize a global hyperpower but that this minority
could keep the colonization out of the public realm for so long even
though the facts themselves have been screaming out to anyone who could
be bothered to listen.
In the politically kosher western world, anti-zionist propositions
are usually ostracized but mostly ridiculed or denounced in passing.
However, when one of the jewish leaders at the centre of this global
zionist conspiracy gives a clear cut example of his treatment of the
president of the united states as a whipping boy, the deniers are put
in an embarrassing position. This is especially so since olmert’s order
to bush was in the best interests of the jews-only state but was in the
president’s (and america’s) worst possible interests because it
provoked the rest of the world to despise him, and america, even more
for his continued warmongering. So, the question arises, how are
mainstream commentators going to confront such a shocking and
indisputable revelation? Here’s a spectacular firework display of the
truth about jewish control over america so are they now going to
pretend they can’t see the fireworks? In the recent past western
politicians wholeheartedly supported the jewish fantasy that saddam
possessed nuclear weapons. Is the world just going to continue
upholding the latest jewish fantasy that iran is close to getting
closer to acquiring nukes whilst, at the same time, pretending that the
jews don’t have them? This article looks at commentators’ response to
olmert’s sudden revelation.
What Olmert said.
Statement.
Many mainstream american publications covered the story of olmert’s
abusive and humiliating treatment of bush. Although they quoted from
his speech the vast majority used only a few selective quotes and often
quoted from different parts of his speech. It is only when the entire
speech is heard that the intensity of olmert’s taunting of bush becomes
clear. The american media thus seemed to limit the quotes it used
partly in order to avoid undermining the authority of the president of
the united states but also to protect the racist state by preventing
americans from appreciating just how vicious olmert’s attack on bush
had been.
The three quotes following provide a fullish account of olmert’s
speech. "According to Olmert, he called the White House upon hearing of
the upcoming UN Security Council resolution. "I said, 'Get me President
Bush on the phone.' They said he was in the middle of giving a speech
in Philadelphia. I said I didn't care: 'I need to talk to him now.' He
got off the podium and spoke to me," Olmert said, according to multiple
media reports. As a result of his conversation with President Bush,
Olmert claimed, the president called Rice and forced her to abstain
from voting on the measure, which she herself had helped author. "He
gave an order to the secretary of state and she did not vote in favor
of it, a resolution she cooked up, phrased, organized, and maneuvered
for. She was left pretty shamed and abstained on a resolution she
arranged," Olmert said." (Daniel Luban ‘Olmert's Claims Revive Israel
Lobby Controversy’ http://www.antiwar.com/ips/luban.php?articleid=14061
January 14, 2009); "According to Olmert, he told Bush that the US
should not vote for the resolution, and Bush then directed Rice to
abstain. "She was left pretty embarrassed," Olmert said. Like Olmert's
aides, an official in the Prime Minister's Office said "the Prime
Minister's comments on Monday were a correct account of what took
place."" (Herb Keinon, Allison Hoffman ‘'PM stands by his version in
diplo spat'’ http://www.jpost.com/servlet/Satellite?cid=1231866576464&pagename=JPost%2FJPArticle%2FPrinter
January 14, 2009); "So, here, in Olmert's words, is what happened next.
"In the night between Thursday and Friday, when the secretary of state
wanted to lead the vote on a cease-fire at the Security Council, we did
not want her to vote in favor. I said, 'Get me President Bush on the
phone.' They said he was in the middle of giving a speech in
Philadelphia. I said I didn't care. 'I need to talk to him now.' He got
off the podium and spoke to me." According to Olmert, Bush was
clueless. "He said: 'Listen. I don't know about it. I didn't see it.
I'm not familiar with the phrasing.’ I told him the United States could
not vote in favor. It cannot vote in favor of such a resolution. He
immediately called the secretary of state and told her not to vote in
favor."" (Patrick J. Buchanan ‘Is Ehud's Poodle Acting Up?’ http://www.antiwar.com/pat/?articleid=14091 January 17, 2009).
U.S. State Department response.
America’s state department was angry with olmert but whether this was
because it didn’t like the president being humiliated or because they
were furious he’d given the game away is not clear. "The U.S. State
Department fiercely denied claims made by Ehud Olmert about his
influence over President George W. Bush, in an incident that has
stirred up old debates about the role of the Israeli government and the
so-called "Israel lobby" in formulating Middle East policy in
Washington." (Daniel Luban ‘Olmert's Claims Revive Israel Lobby
Controversy’ http://www.antiwar.com/ips/luban.php?articleid=14061 January 14, 2009).
Olmert not backing down.
"The State Department immediately contradicted Olmert’s claims,
insisting that "the government of Israel does not make US policy."
Spokesman Sean McCormack also suggested that Israel might want to
"clarify or correct the record" with respect to the comments. Rice has
dismissed Olmert’s claims as "fiction." The comments have sparked no
small concern in Israel, where the fear is that Olmert’s claims to be
able to order the President of the United States around will only
increase public opposition in America to Israel’s influence on its
foreign policy. Yet spokesmen for Olmert say that the prime minister
stands behind his version of events." (‘Olmert Stands Behind
Rice-Shaming Claim: Rice Calls Prime Minister's Comments "Fiction"’ http://news.antiwar.com/2009/01/14/olmert-stands-behind-rice-shaming-claim/ January 14, 2009).
Haaretz suggests Olmert closer to the truth than Rice.
"Inquiries with people uninvolved in the spat between Prime Minister
Ehud Olmert and U.S. Secretary of State Condoleezza Rice reveal that
his version of the lead-up to America's vote on last week's Security
Council resolution is closer to the truth than hers. The whole story
would have ended well had Olmert behaved like a responsible adult and
restrained his own impulses. Even his close associates admit that he
would have done better to skip the public boasting about how he
persuaded Bush to overrule Rice. Quite aside from the fact that this
embarrassed the U.S. administration, Olmert's associates understand all
too well that this story merely provides fresh ammunition to those who
claim the Jews are the ones who really control America." (Akiva Eldar
‘Inquiries show Olmert version of UN Gaza vote spat closer to truth
than Rice's’ http://www.haaretz.com/hasen/spages/1055966.html January 01, 2009).
How have America’s commentators reacted to Olmert confession?
In the past, american commentators have adamantly refused to discuss
jewish economic, cultural, or political, power in america. Indeed,
their silence is yet another piece of evidence as to the existence of
such power. So, will olmert’s confession set them free to challenge the
jews’ colonization of america and its calamitous consequences for the
country (and many other countries around the world)? Or will they just
go on living comfortably in the zionist fantasy world created for them
by america’s jewish ruling elite?
Juan Cole picks up on Olmert’s confession to propose that Jewish
nazis are exercising their power in America not merely through Bribery
but Blackmail.
Cole covered the outburst in detail and speculated that zionist power
in america might derive from mossad’s acquisition of material with
which it could blackmail bush. For a political commentator such as
cole, a high profile member of america’s defunct wasp establishment, to
have to resort to such a wacky, fringe, idea is unusual to say the
least. But then again what alternative does he have since he won’t talk
about america’s ruling jewish elite, the colossal economic power
acquired by the jewish elite, nor the zionists near total domination of
congress and the american media.
Steven C Clemons.
Clemons personalizes olmert’s statement so that it is merely a kick in
the face for the president and condoleeza rice rather than a statement
of shame about the gross subservience of america’s much vaunted
democratic system and the ignominious position of the american people
whose political leaders care more about protecting the jews-only state
in palestine than looking after their own citizens. "No matter what one
may think of Condoleezza Rice's diplomatic record, which I think is
better than many liberal critics gauge, the fact that Israel Prime
Minister Ehud Olmert gave her a kick in the teeth as she departs her
office is obnoxious and harmful all around. Shaming a US President and
Secretary of State may not change the course in policy and may not
shift America's general approach to the region, at least for the time
being, but it does take the fizz out of the unique relationship."
(Steven C Clemons ‘Defending Condi: Olmert Shames Himself in
Kick-in-the-Teeth Attack on Rice’ http://www.thewashingtonnote.com/archives/2009/01/defending_condi/
January 12, 2009). Clemons has no interest in questioning the political
significance of america’s democracy, reputed by common opinion to be
the best in the world, even though its president and members of
congress are mere vassals to a rogue state, a hive of jewish racists,
in the middle east.
Philip Weiss.
"Clemons gets it right re Olmert and Condi, that it's a disgraceful
attack. I missed the humiliation in this. Israel often treats our
executive like the help, because Israelis know they have power in
Washington. It's similar to Ehud Barak treating Bill Clinton like a
peer in 2000, and Yitzhak Shamir lying to George Bush about not
building more settlements, in '91. They always get away with it,
because of the lobby. No wonder the fury at J Street has been
coordinated by the Israeli embassy. They have so much to lose." (Philip
Weiss ‘Where is Hillary on cease-fire?’ http://www.philipweiss.org/mondoweiss/2009/01/where-is-hillary-on-ceasefire-.html January 13, 2009). Here’s one jewish writer making a determined effort to learn the truth about american politics.
Xymphora points out Kouchner’s Zionist Treachery.
"Juan Cole, who seems to be letting his freak flag fly recently, has an
excellent detailed posting on the automatic control that the Israeli
government has over the American government, exemplified by Olmert
picking up the phone and ordering Bush around to the extent that the
United States changed its mind and abstained, rather than voted for,
the latest UN cease-fire resolution. This was a public slap in the face
for Rice, who actually helped draft the resolution, and Olmert is
crowing about it. Note the behind-the-scenes trickery of the Jew
Kouchner, who valiantly worked for his homeland, Israel, naturally, not
France, to try to block the resolution. Cole concludes by raising the
most important issue of all, the consideration of which is necessitated
by the lack of any obvious motive for Bush to act as he did, the
conspiracy theory that the mysterious hold of Zionism over American
politicians is connected to blackmail. Israeli intelligence, with the
aid of the secret cadre of dual-loyalty American Jews, gathers dossiers
of information on characters like Bush, people who have a lot of
embarrassments in their pasts, and holds it over them. Other than
direct payments of cash, which probably explains Cheney, this is by far
the most plausible theory for why American politicians consistently and
blatantly act against American interests (sorry Noam). I wonder what
the Israeli dossier on Obama looks like?" (Xymphora ‘The mysterious
hold of Zionism over American politicians’ http://xymphora.blogspot.com/2009/01/mysterious-hold-of-zionism-over.html January 13, 2009).
Matthew Yglesias.
"The State Department has some not-terribly-convincing denials out. But
one way or another it seems both telling and unseemly that Olmert is
going around bragging about this." (Matthew Yglesias ‘Olmert Claims to
Control US Foreign Policy’ http://yglesias.thinkprogress.org/archives/2009/01/olmert_claims_to_control_us_foreign_policy.php
January 13, 2009). Olmert should be applauded for telling the truth not
criticized for bragging. Now that the truth is out why doesn’t yglesias
spend his time outlining its fundamental political implications and
ramifications?
Paul Craig Roberts.
The inimitable paul craig roberts is a unique and fearless commentator:
a former politician who speaks truth to power. "Israeli politicians
have been bragging for decades about the control they exercise over the
US government. In his final press conference, President Bush, deluded
to the very end, said that the whole world respects America. In fact,
when the world looks at America, what it sees is an Israeli colony.
What is happening to the Palestinians herded into the Gaza Ghetto is
happening because of American money and weapons. It is just as much an
attack by the United States as an attack by Israel. The US government
is complicit in the war crimes. "Our" president was a puppet for a
cabal led by Dick Cheney and a handful of Jewish neoconservatives, who
took control of the Pentagon, the State Department, the National
Security Council, the CIA, and "Homeland Security." From these power
positions, the neocon cabal used lies and deception to invade
Afghanistan and Iraq, pointless wars that have cost Americans $3
trillion, while millions of Americans lose their jobs, their pensions,
and their access to health care." (Paul Craig Roberts ‘The White House
Moron Stumbles to the Finish: The Humiliation of America’ http://www.counterpunch.com/roberts01142009.html January 14, 2009).
Steven Spiegel.
"Middle East expert Steven Spiegel described the episode as "the worst
faux pas by an Israeli prime minister in history. You really do wonder
what the prime minister was thinking, if it's true, you'd really want
to keep it as quiet as possible, and if it's not true, why would you
want to make up a story that would embarrass both the Bush
administration and the Israeli government and draw criticism from those
who are antagonistic to Israel?" asked Spiegel, director of the Center
for Middle East Development at UCLA. "No matter how you play it,
exaggeration, falsehood, whole truth, the whole thing makes them all
look bad," Spiegel told The Jerusalem Post." (Herb Keinon, Allison
Hoffman ‘'PM stands by his version in diplo spat'’ http://www.jpost.com/servlet/Satellite?cid=1231866576464&pagename=JPost%2FJPArticle%2FPrinter January 14, 2009).
Justin Raimondo.
In the past, raimondo has been edging towards stating that the
jews-only state in palestine, with the aid of its political agents in
america, controls america’s foreign policies. It might have been
thought he would have taken olmert’s statement as a great opportunity
to highlight this fundamental reality of american politics. At first it
seems he would. "It (Olmert’s statement) tells us who is used to giving
orders, and who is accustomed to obedience." (Justin Raimondo ‘Israel
versus America: Is the 'special relationship' over? http://www.antiwar.com/justin/?articleid=14075
January 16, 2009). But he doesn’t. "What Gaza signals is a new turn for
the Israelis, a clean break, if you will, with their status as an
American puppet in the Middle East. They are clearly going off on their
own, intent on waging a war of unmitigated aggression against all their
neighbors." (Justin Raimondo ‘Israel versus America: Is the 'special
relationship' over? http://www.antiwar.com/justin/?articleid=14075
January 16, 2009). When given the opportunity he ducks it. The
apartheid state has always been an american puppet but is now going off
on its own. Such an argument would make sense if america had stopped
giving the racist state vast annual tribute payments and stopped
providing it with endless quantities of weapons and munitions with
which to slaughter innocent civilians. Oh well, seems like raimondo’s
back in the closet.
Patrick J. Buchanan.
Over the last couple of decades, buchanan has been one of the few
mainstream american politicians who have criticized the jews-only state
and jewish power in america and has suffered the consequences. And yet
he’s been quite restrained about olmert’s confession. "With Bush and
Rice leaving office in hours, and Olmert in weeks, the story may seem
to lack significance. Yet, public gloating by an Israeli prime minister
that he can order a U.S. president off a podium and instruct him to
reverse and humiliate his secretary of state may cause even Ehud's
poodle to rise up on its hind legs one day and bite its master. Taking
such liberties with a superpower that, for Israel's benefit, has
shoveled out $150 billion and subordinated its own interests in the
Arab and Islamic world would seem a hubristic and stupid thing to do."
(Patrick J. Buchanan ‘Is Ehud's Poodle Acting Up?’ http://www.antiwar.com/pat/?articleid=14091 January 17, 2009).
Brian Cloughley.
Cloughley enters the fray, "And the President of the United States of
America jumps to obey the Israeli prime minister." (Brian Cloughley
‘The Power of AIPAC: Who Runs America?’ http://www.counterpunch.com/cloughley01162009.html January 16-18, 2009).
However, the reason that america’s ruling jewish elite is nigh on
impervious is because those on the left refuse to challenge it.
Cloughley points out that members of congress are funded by jews but
doesn’t generalize beyond this to expose america’s ruling jewish elite.
"There is one thing certain: the US Congress is going to continue its
unconditional support for Israel, no matter what war crimes are
committed by its disgusting thugs-in-uniform. The Reps need the money,
after all, which they get through political action committees which are
generously funded by American Jews. And they are scared to political
death by the threat that pro-Israel agencies will destroy them
politically if they dare say a word against Israel. There are very few
Representatives of the people of America who would dare challenge
Israel, or who might possibly criticize Israel, or who have the courage
to condemn atrocities committed by Israel." (Brian Cloughley ‘The Power
of AIPAC: Who Runs America?’ http://www.counterpunch.com/cloughley01162009.html January 16-18, 2009).
He criticizes the american media for not telling the truth. "Not
many Americans know anything about the hideous barbarity in Gaza,
because US cable networks and newspapers rarely carry pictures of
disfigured blood-splashed children who have been killed, maimed or
orphaned by the Israelis. But here in Europe we have access to some TV
channels and newspapers that are very different from the pliant
pro-Zion patsies of the major news outlets across the Atlantic." (Brian
Cloughley ‘The Power of AIPAC: Who Runs America?’ http://www.counterpunch.com/cloughley01162009.html
January 16-18, 2009). But he fails to tell the truth by not denouncing
the zionist owned and controlled american media. The media in any
country is a reflection of that society’s ruling class. No ruling class
rules without the help of a cheerleading media. The reason that
america’s mainstream media supports the jews-only state is because it
is owned and staffed primarily by members of america’s ruling jewish
elite.
Tony Karon.
As far as is known karon has made no comment about olmert’s confession.
However, the confession places karon’s comments about rice’s
supervision of the jewish war against lebanon in 2006 in a different
light. "It was clear, at the time, that the neophyte Olmert was
outsourcing his decision-making to Condi Rice. I wrote at the time of
the sense that Israel was waging a proxy war for the Bush
Administration, a sense confirmed at the time by the hawkish dean of
Israeli military correspondents, Ze’ev Schiff, who wrote at the height
of the conflict: "U.S. Secretary of State Condoleezza Rice is the
figure leading the strategy of changing the situation in Lebanon, not
Prime Minister Ehud Olmert or Defense Minister Amir Peretz. She has so
far managed to withstand international pressure in favor of a
cease-fire, even though this will allow Hezbollah to retain its status
as a militia armed by Iran and Syria." (Tony Karon ‘Olmert: His Own
Shlemiel, or Bush’s?’ http://tonykaron.com/2008/01/31/olmert-his-own-shlemiel-or-bushs/
January 31, 2008). If olmert was capable of humiliating rice over the
united nations’ resolution over gaza is it likely that, two years
earlier, he’d allowed her to run the show slaughtering lebanese
civilians?
George Bush, the Jews’ whipping Boy.
What has not been pointed out by commentators on olmert’s confession
was that he was referencing a statement made by ariel sharon a few
years earlier. In september 2001, sharon had publicly humiliated bush
by calling him a chamberlain. "Don't repeat the terrible mistake of
1938 when the enlightened democracies of Europe decided to sacrifice
Czechoslovakia for a convenient temporary solution. Do not try to
placate the Arabs at our expense ... Israel will not be Czechoslovakia.
Israel will fight terror." (‘Israel consumed by victim culture’
Guardian 5.10.2001). A few days later, sharon compounded the
humiliation, "Every time we do something, you (Shimon Peres) tell me
Americans will do this and will do that. I want to tell you something
very clear. Don’t worry about American pressure on Israel; we, the
Jewish people, control America and the Americans know it." (Zionist
Prime Minister Ariel Sharon October 3, 2001 IAP News).
Olmert’s jewish audience would have picked up on this reference and
understood that olmert was trying to cloak himself with sharon’s mantle
as one of the jews’ most belligerent warmongers (although whether they
believed olmert deserved such a comparison is another matter).
Olmert’s humiliation of bush could not be a more fitting finale to
bush’s presidency. His presidency began not so much on september 11,
2001 with al qaeda’s attacks on new york and the pentagon but with
sharon’s success in forcing him to accept the likudnik interpretation
of this event. The bush regime did not respond to this event by
implementing policies to protect and promote american interests. On the
contrary, sharon, and the jewish neocons/lobby in america, pushed the
bush regime into implementing policies that boosted the interests of
the jews-only state in palestine even though these policies would have
a catastrophic impact on america’s interests. In other words, the
president of the united states failed to interpret this critical event,
even though it happened in his own country, because he was overwhelmed
by the narrative put forward by the leader of a shitty little country
on the other side of the planet and by jewish neocons in america loyal
to that country. Al quaeda attacked america because of its
unconditional support for the jews-only state. Bush and america could
have realized that such unconditional support was against america’s
interests, but the rogue state and its jewish agents in america
pressured the president into adopting even more extreme zionist
policies which put america interests at even greater risk.
Al qaeda’s payback on america was a major turning point in american
history but americans had nothing to do with the direction in which
their own country then moved. "Common wisdom has it that after 9/11, a
new era of geo-politics was ushered in, defined by what is usually
called the Bush doctrine: pre-emptive wars, attacks on terrorist
infrastructure (read: entire countries), an insistence that all the
enemy understands is force. In fact, it would be more accurate to call
this rigid worldview the Likud doctrine. What happened on September 11,
2001 is that the Likud doctrine, previously targeted against
Palestinians, was picked up by the most powerful nation on earth and
applied on a global scale. Call it the Likudisation of the world: the
real legacy of 9/11." (Naomi Klein ‘The Likud doctrine’ The Guardian http://www.guardian.co.uk/russia/article/0,2763,1301504,00.html
September 10, 2004); "But the idea of a super-power behaving in a
similar way, responding to terrorist threats or guerrilla incursions by
flattening another country just to preserve its own deterrent
credibility, is odd in the extreme. It is one thing for the US
unconditionally to underwrite Israelis’ behaviour (though in neither
country’s interest, as some Israeli commentators at least have
remarked). But for the US to imitate Israel wholesale, to import that
tiny country’s self-destructive, intemperate response to any hostility
or opposition and to make it the leitmotif of American foreign policy:
that is simply bizarre. Bush’s Middle Eastern policy now tracks so
closely to the Israeli precedent that it is very difficult to see
daylight between the two. It is this surreal turn of events that helps
explain the confusion and silence of American liberal thinking on the
subject (as well, perhaps, as Tony Blair’s syntactically sympathetic
me-tooism). Historically, liberals have been unsympathetic to ‘wars of
choice’ when undertaken or proposed by their own government. War, in
the liberal imagination (and not only the liberal one), is a last
resort, not a first option. But the United States now has an
Israeli-style foreign policy and America’s liberal intellectuals
overwhelmingly support it." (Tony Judt ‘Bush’s Useful Idiots’ http://www.lrb.co.uk/v28/n18/judt01_.html September 21 2006).
An american president who calls for a palestinian state (the first
to do so) but fails to deliver it, despite the successive, nonstop,
diplomatic efforts of colin powell and condoleezza rice, america’s
massive funding of the apartheid state, and the widespread
international support for such a goal, is clearly subservient to
zionist power and influence. Brent scowcroft was one of the few to
confront such fundamental realities of american political life when he
stated that ariel sharon had bush wrapped around his little finger. It
is a remarkable testimony to americans’ capability for living in their
highly leveraged zionist fantasy world that they ignored scowcroft’s
insider remark and continued their patriotic bleats about how america
is the most powerful country in the world with the world’s sole
military hyper-power.
For a number of other blatant examples of how sharon continually
beat up bush and got him to support extreme zionist policies which have
had the most devastating economic, political, and military,
consequences for america please see ‘America is a Jewish Colony: Bush
is Sharon’s Muppet’
http://themundiclub.blogspot.com/2009/01/america-is-jewish-colony-bush-is.html
It is hardly surprising then that the bush presidency should end so
ignominiously when another hysterical, paranoid, warmonger from the
jewish nazi state boasted to the whole world that, in effect, bush was
nothing but his whipping boy. Why should olmert fear retribution for
his gross humiliation of bush and the american people when they can’t
harm jewish power in america?
[Baca]
1. I have been in the United Kingdom for more than a week - a long time for me to stay in any place abroad.
2. When I left Malaysia the papers and television were full of reports
on the Israeli brutalities in Gaza. There were heart-wrenching pictures
of little children half-buried in the rubble of destroyed houses. I was
very upset with Israeli brutalities and I thought the whole world would
condemn Israel.
3. I was shocked that in the United Kingdom, the land of the free press
and free speech there was hardly any report on Gaza and the Israeli
invasion. Certainly there were no pictures of the brutal killing of
children.
4. I understand that it is the same in America, another great advocate of the freedom of the Press.
5. Maybe by freedom of the Press they mean allowing the Press to pick
and choose what they wish to publish. Yet they talk about
self-censorship in Malaysia. What our papers fail to report is nothing
compared to what the British and American media fail to report.
Obviously they are protecting Israel's interest.
6. All these give credence to the allegation that the Jews control the
Western media. When in 2003 at the OIC conference I said that the Jews
rule the world by proxy, I was condemned by the Western press and the
US Government. It would seem that Jewish control over the ethnic
European countries, in particular the United States of America is total.
[Baca]
Ministers step into row over corporation's refusal to show charities' plea for donations to Gaza
By Emily Dugan, Jane Merrick and Matthew Bell
Sunday, 25 January 2009
Tom Saunderson
Protesters outside BBC offices in central London yesterday
The
BBC was engaged in a war of words with ministers last night over its
refusal to broadcast an urgent appeal for humanitarian aid to Gaza.
Government figures, aid workers and BBC staff expressed outrage that
the corporation has not backed down, as some of its rivals did
yesterday, and broadcast the Disasters Emergency Committee (DEC)
appeal. The BBC said yesterday it was concerned that access to aid in
Gaza might be problematic, and that it did not want to endanger the
public's perception of the impartiality of its reporting.
The
BBC Trust chairman Sir Michael Lyons expressed concern that the "level
and tone" of the political comments were "coming close to constituting
undue interference in the political independence" of the corporation.
Channel
4, Five, ITV and al-Jazeera English announced they will be airing the
DEC appeal tomorrow, after initially falling in behind the BBC. Sky
News was considering its position last night.
Public figures were
outraged by the broadcaster's decision not to air the appeal, calling
it a "terrible mistake". One former senior BBC journalist referred to
"a culture of timidity". The BBC has previously aired DEC pleas for
humanitarian help in volatile regions such as Congo and Burma.
Yesterday
a march that had been organised to complain about the BBC's alleged
pro-Israel bias, which began outside Broadcasting House, was given new
focus by the row.
The director-general, Mark Thompson, stood by
his decision last night, despite critics' attempts to draw a
distinction between politics and aid.
The row once again pitted
the Government against the BBC, six years on from the David Kelly
controversy. It raised further questions over the judgement of senior
BBC officials weeks after the Ross/Brand affair.
In an unusual
intervention by a cabinet minister, the International Development
Secretary, Douglas Alexander, wrote to Mr Thompson on Friday urging him
to reconsider, but Whitehall sources said the BBC seemed determined not
to back down. The health minister Ben Bradshaw, a former BBC
journalist, said the decision was "inexplicable" and called the
corporation's justification "completely feeble". The Communities and
Local Government Secretary, Hazel Blears, added: "I sincerely hope the
BBC will urgently review its decision."
A motion has been tabled
in the Commons for tomorrow expressing astonishment at the
corporation's judgement in blocking airtime from the coalition of major
aid charities, including the British Red Cross.
It is
understood that it was Mr Thompson's decision, and chief operating
officer Caroline Thomson was ordered to go on radio – initially on
Friday on Radio 4's The World Tonight – to defend the position. A
source close to the row said: "Because she [Ms Thomson] has gone so
strongly on editorial independence, it is very difficult to see how
they can back down."
Ms Thomson said yesterday: "It is important
to remember that broadcasting appeals like this is a unique thing we do
and we have to be clear about two things when we do it. First, that
that money will go to the people it is intended for; but second, that
we can do it within our own impartiality principles and without
affecting and impinging on the audience's perception of our
impartiality."
Protocol dictates that the BBC leads the way on
deciding a consensus on DEC appeals with other channels. But rival
channels allege the corporation made an announcement on Thursday before
consulting them, forcing them to break with the convention.
The
DEC is an apolitical umbrella organisation made up of UK major aid
organisations ActionAid, British Red Cross, Cafod, Care International
UK, Christian Aid, Concern Worldwide, Help the Aged, Islamic Relief,
Merlin, Oxfam, Save the Children, Tearfund and World Vision.
Mr
Alexander welcomed the move by rival broadcasters to air the appeal:
"The DEC appeal is crucial to help alleviate the suffering of people
injured, displaced and hungry in Gaza."
Many former BBC stalwarts
were appalled at the news and called for an immediate reversal of the
decision. John Tusa, former managing director of BBC World Service,
said: "It's a terrible mistake and I think they have lost for the
moment any sense of judgement and a good deal of courage. Anybody who
thinks giving aid to badly injured children in Gaza would be taken as
bias needs their heads examined."
Former BBC correspondent Martin
Bell said: "Old BBC soldiers like me are appalled by the BBC's
decision. There are civilians dying out there who desperately need aid."
Director-general is under pressure to go
Mark
Thompson's statement last night was a typically robust reaction to the
latest challenge troubling his tenure as director-general of the BBC.
A
scandal surrounding rigged phone-in contests on 'Blue Peter' in 2007
led to the regulator Ofcom fining the BBC £50,000. The BBC1 controller
Peter Fincham resigned in the same year over the the editing of a
trailer that misleadingly suggested that the Queen had stormed out of a
photo session.
Mr Thompson came under pressure to resign last
year, in the wake of controversy surrounding lurid calls to the actor
Andrew Sachs, which resulted in the departure of Russell Brand, the
resignation of BBC Radio 2 controller Lesley Douglas, and the
suspension of Jonathan Ross.
Ministerial anger over his decision
not to back down over the appeal will add to the pressure for Mr
Thompson to do what some of his senior staff have done in recent years
– resign.
Balance in the media: Has the BBC lost its nerve over Gaza?
The
BBC is used to being accused of anti-Israel bias, but in 2004 it was
jolted by a study that said BBC1 and ITV news were guilty, if
unthinkingly, of under-reporting the Palestinian cause. Worse, the
Glasgow Media Unit found viewers thought the "occupation" of the West
Bank and Gaza referred to the Palestinians, not Israeli settlers.
At
the same time, the BBC fell foul of the Israeli authorities over an
interview with the nuclear whistleblower Mordecai Vanunu, released in
2004 after 18 years in prison, which was smuggled out of Israel. The
BBC's then deputy bureau chief, Simon Wilson, had his work permit
withdrawn and was barred from the country. He was allowed back in after
the BBC bowed to demands that he make a written apology to the Israeli
government for dodging its censors.
The BBC appointed a senior
broadcaster, Malcolm Balen, to "take stock" of Middle East coverage, in
his words. He drew up an internal report that has never been released,
but one result appeared to be the appointment, in mid-2005, of Jeremy
Bowen as the BBC's Middle East editor. His stated role was to supply
context amid the footage of bloodshed and mayhem.
Why critics
accuse the BBC of losing its nerve is because, several times during the
present conflict, almost as much airtime has been given to the chief
Israeli spokesman, Mark Regev, as if by allowing him his say, the BBC
is supplying the necessary "balance" to the images of Palestinian
victims. A live "two-way" between Mr Regev and Jon Snow of 'Channel 4
News' became a shouting match, but this has never happened on the BBC.
Donations can be made to the DEC Gaza appeal via its website www.dec.org.uk or by calling 0370 60 60 900
[Baca]
Israel devastated the Strip's production capacity as well as destroying homes
Monday, 26 January 2009
AP
A Palestinian woman waits at a UN food distribution centre in Gaza City yesterday
Israeli forces used aerial bombing, tank shelling and armoured bulldozers to
eliminate the productive capacity of some of Gaza's most important
manufacturing plants during their 22 days of military action in the Gaza
Strip. The attacks – like those which destroyed at least 4,000 homes, left
some residential areas resembling an earthquake zone and more than 50,000
people in temporary shelters at their peak – destroyed or severely damaged
219 factories, Palestinian industrialists say.
Leaders of Gaza's business community – who have long stayed aloof from the
different Palestinian political factions – say that much of the 3 per cent
of industry still operating after the 18-month shutdown caused by Israel's
economic siege has now been destroyed.
Chris Gunness, chief spokesman for the UN Relief and Works Agency (UNRWA),
said that widespread destruction of "civilian economic infrastructure"
was a strike "at the heart of the peace process" because "economic
stability is an essential component of a durable peace."
While the main impact of the destruction is likely to be on the already
politically fraught prospects of medium to long-term reconstruction in Gaza,
it it is unlikely to make efforts to help its many stricken and displaced
residents any easier. It is those humanitarian relief efforts for which the
main British aid agencies are appealing for help in the advertisement so far
barred by the BBC. Meanwhile, the UNRWA is separately pressing donors for
$345m for immediate repairs to homes still standing and to its own damaged
premises.
The destroyed factories include: Alweyda, the biggest Palestinian
food-processing plant and the only one still operating in Gaza until the
war; Abu Eida, the largest, and now flattened, ready-mixed concrete
producer; and the 89-year-old Al Badr flour mills, which have the biggest
storage facilities anywhere in the Strip. The owners of all three said
yesterday they were proud of their close and long-standing contact with
Israeli partner firms and suppliers. Dr Yaser Alweyda, owner and engineering
director of the demolished food-processing plant, estimated the total damage
to his plant at $22.5m and accused Israel of wanting "to destroy the
weak Palestinian economy". He added: "They want to ensure that we
will never have a state in Palestine."
Tawfiq Abu Eida, the owner of the concrete factory, said he had been preparing
just before the war to supply the Beit Lahiya sewage works, a key project of
the Middle East envoy Tony Blair.
The air and ground strikes have compounded the impact of the trade embargo,
which Israel imposed in June 2007 after Hamas's enforced takeover of the
Strip. Amr Hamad, the executive manager of the Palestinian Federation of
Industries, said: "What they were not able to reach by the blockade,
they have reached with their bulldozers." He added: "Businessmen
are not connected at all to Hamas and are very pragmatic and open-minded.
"They are the the last layer in Palestinian society who believe in peace
and the importance of the economy. They also believe that the only economic
link should be with Israel," Mr Hamad said.
The Israeli Prime Minister, Ehud Olmert, told his cabinet that with "typical
moral acrobatics", the "terrorist organisations" were trying
to lay the blame on Israel, and that "the State of Israel did
everything in order to avoid hitting civilians." Israel would ensure
that soldiers and officers who took part in the operation would be safe from
any tribunals investigating them, he said.
At the Al Badr mills in Sudaniya, north of Gaza City, owner Rashed Hamada, 55,
said his company had been making flour for bakeries right up until the
attack on 10 January. He strongly denied that his compound, which was locked
at night and had a security guard, had been used by Hamas gunmen, and said
it was clear the production line itself had been the target.
"It seems that the father of the commander had owned a flour mill,"
he commented ironically. "He knew exactly where to hit. The Israelis
... used to encourage me to expand production here. Now they have destroyed
it. I don't understand why."
Standing beside mangled and incinerated refrigeration vans and the burned-out
ruins of his food factory and warehouses, located for ease of access to
Israel between the eastern Gaza City district of Shajaia and the border 650
metres away, Dr Alweyda said that, as well as the production lines, 26
vehicles had been destroyed. The company, sole Gaza agent for Tnuva, an
Israeli milk-products company, had managed to keep biscuit production going
up until the outbreak of war. The Israeli military said yesterday that it
was still investigating allegations of civilian casualties and property
damage but that it "does not target civilians or civilian
infrastructure, including factories, unless it is being used by Hamas for
terrorist purposes."
But Amr Hamad said that he believed the two purposes of the strikes was to
make Gaza's economy dependent on Israel's, and to stimulate popular pressure
on Hamas to agree to certain compromises as a precondition to a reopening of
the crossings – such as allowing the Ramallah-based Palestinian Authority
control of the crossings and also the release of Israeli corporal Gilad
Shalit, abducted two-and-a-half years ago by Hamas and other militants.
[Baca]
January 22, 2009 Inter Press Service
GAZA CITY - Eighteen-year-old Mona Al-Ashkar says she did not immediately know the first explosion at the United Nations (UN) school in Beit Lahiya had blown her left leg off. There was smoke, then chaos, then the pain and disbelief set in once she realized it was gone - completely severed by the weapon that hit her.
Mona is one of the many patients among the 5,500 injured that have international and Palestinian doctors baffled by the type of weaponry used in the Israeli operation. High-profile human rights organizations like Amnesty International are accusing Israel of war crimes.
Mona's doctors at Gaza City's Al-Shifa hospital found no shrapnel in her leg, and it looked as though it had been "sliced right off with a knife."
"We are not sure exactly what type of weapon can manage to do that immediately and so cleanly," said Dr. Sobhi Skaik, consultant surgeon general at Al-Shifa hospital. "What is happening is frightening. It's possible the Israeli army was using Gaza to experiment militarily."
Both international organizations and human rights groups, including the UN, Human Rights Watch and Amnesty International, have condemned Israel's use of unconventional weapons in civilian areas of the Gaza Strip.
Amnesty International's chief researcher for Israel and the Palestinian Territories, Donatella Rovera, told IPS in Beit Lahiya that Israel's use of white phosphorus and other "area weapons" on civilian populations amounted to war crimes.
"The kind of weapons used and the manner in which they were used indicates prima facie evidence of war crimes," she said.
Israel announced Wednesday it would be launching its own probe into reported use of white phosphorus, but has so far refused to comment further.
The International Atomic Energy Agency (IAEA), the UN's nuclear watchdog, said it would look into a claim made by the ambassadors of a number of Arab nations that Israel used depleted uranium in its recent attacks on Gaza.
Local doctors say a number of both widespread and unusual injuries may indicate that new types of weapons were used on the Gaza population during the war. Health officials are seeing wounds they have never seen before, or at least not on such a massive scale.
"There has been a significant loss of life here in Gaza for reasons that are unexplainable medically," said Dr. Skaik.
Mona's injury is characteristic of Dense Inert Metal Explosives (DIME). DIMEs are munitions that, packed with tungsten powder, produce an intense explosion at about the level of the knee, with signs of severe heat at the point of amputation.
"If you ask a patient how it happened, how their leg was removed, they won't know," Dr. Skaik said. "They'll say that a rocket or missile exploded and took only their lower limbs off."
Once in the body, tungsten is both difficult to detect and extremely carcinogenic, and can produce an aggressive form of cancer, according to both military experts.
Dr. Skaik says the Al-Shifa hospital alone has seen between 100 to 150 patients with this type of injury. Over 50 patients at Al-Shifa had two or more limbs severed, he says.
But because Gaza's hospitals are so poorly equipped, it has been nearly impossible so far to test properly for the substances and count accurately how many wounded Palestinians may have been hit with this weapon.
The Norwegian doctor Mads Gilbert who worked at Al-Shifa hospital during the siege confirmed to journalists that the injuries were aligned with those produced by DIME explosives.
Human rights groups say Israel used the weapon for the first time in Lebanon in 2006.
What is worrying health officials even more, however, is that some of the patients' organs are being ruptured with little or no sign of a shrapnel entry point.
This is something they have never seen before, they say, and also something they do not know how to treat.
"Normal shrapnel has a clear path, with both an entry and an exit point," said Dr. Mohamed Al-Ron, another surgeon at Al-Shifa hospital.
"But someone's entire abdomen will be ripped open, and only after searching will we find a miniscule hole in the skin. Then we will find small black dots all over the organ, but we don't know what they are."
It is an indication, he continued, that whatever is entering the body is exploding and doing the damage once it is inside. Multiple organs will fail, and will continue to fail even after surgery removes any shrapnel.
"We are consulting with international colleagues, and they are confirming that there is something unusual going on with these cases," said Dr. Skaik.
"We have seen plenty of nails, of metal shrapnel and foreign metallic parts, but there was never violence of this character or something that continued to damage even after the parts of the weapon were removed. What is being intentionally created is a population of handicapped people."
Some of the injuries, including multiple organ failure, mutilation and severed limbs, are so debilitating that Dr. Karim Hosni, an Egyptian doctor volunteering at the Al-Naser hospital in Khan Younis, says he wishes he could just end his patients' misery.
"Sometimes I wish my patients would just die," he said. "Their injuries are so horrifying, that I know they will now have to lead terrible and painful lives."
[Baca]
January 22, 2009 Washington Post
As you settle into the Oval Office, Mr. President, may I offer a suggestion? Please do not try to put Afghanistan aright with the U.S. military. To send our troops out of Iraq and into Afghanistan would be a near-perfect example of going from the frying pan into the fire. There is reason to believe some of our top military commanders privately share this view. And so does a broad and growing swath of your party and your supporters.
True, the United States is the world's greatest power -- but so was the British Empire a century ago when it tried to pacify the warlords and tribes of Afghanistan, only to be forced out after excruciating losses. For that matter, the Soviet Union was also a superpower when it poured some 100,000 troops into Afghanistan in 1979. They limped home, broken and defeated, a decade later, having helped pave the way for the collapse of the Soviet Union.
It is logical to conclude that our massive military dominance and supposedly good motives should let us work our will in Afghanistan. But logic does not always prevail in South Asia. With belligerent Afghan warlords sitting atop each mountain glowering at one another, the one factor that could unite them is the invasion of their country by a foreign power, whether British, Russian or American.
I have believed for some time that military power is no solution to terrorism. The hatred of U.S. policies in the Middle East -- our occupation of Iraq, our backing for repressive regimes such as Egypt and Saudi Arabia, our support of Israel -- that drives the terrorist impulse against us would better be resolved by ending our military presence throughout the arc of conflict. This means a prudent, carefully directed withdrawal of our troops from Iraq, Afghanistan, Saudi Arabia, Qatar and elsewhere. We also need to close down the imposing U.S. military bases in this section of the globe, which do so little to expand our security and so much to stoke local resentment.
We cannot evade this reckoning. The British thought they could extend their control over Iraq even while pulling out their ground forces by creating a string of bases in remote parts of the country, away from the observation of most Iraqis. It didn't work. No people that desires independence and self-determination wishes to have another nation's military bases in its country. In 1776, remember, 13 little colonies drove the mighty British Empire from American soil.
In 2003, the Bush administration ordered an invasion of Iraq, supposedly to reduce terrorism. But six years later, there is more terrorism and civil strife in Iraq, not less. The same outcome may occur in Afghanistan if we make it the next American military conflict.
Mr. President, the bright promise of your brilliant campaign for the White House and the high hopes of the millions who thronged the Mall on Tuesday to watch you be sworn in could easily be lost in the mountains and wastelands of Afghanistan.
The Nobel Prize-winning economist Joseph E. Stiglitz has estimated that the war in Iraq will have a total cost of more than $3 trillion. That war has clearly weakened our economy and our armed forces even as it has made the national debt soar. The Bush administration committed itself to Iraq before the recession. Today, with our economy teetering, does the Obama administration believe that it is time for yet another costly war in yet another Muslim country?
I'm aware that some of my fellow Americans regard me as too idealistic. But sometimes idealism is the best realism. And at a minimum, realism and idealism need not be contradictory. The invasion and occupation of Iraq has not only angered Iraqis who have lost family members, neighbors or homes; it has also increased the level of anger throughout the Muslim world and thrown up obstacles to our political leadership in that deeply important part of the planet.
Like you, Mr. President, I don't oppose all wars. I risked my life in World War II to protect our country against genuine danger. But it is the vivid memory of my fellow airmen being shot out of the sky on all sides of me in a war that I believe we had to fight that makes me cautious about sending our youth into needless conflicts that weaken us at home and abroad, and may even weaken us in the eyes of God.
As you have noted, Mr. President, we take pride in our soldiers who conduct themselves bravely. But as you have also said, some of these soldiers have served two, three and even four tours in dangerous combat. Many of them have come home with enduring brain and nerve damage and without arms and legs. These troops need rest, rehabilitation and reunions with their families.
So let me suggest a truly audacious hope for your administration: How about a five-year time-out on war -- unless, of course, there is a genuine threat to the nation?
During that interval, we could work with the U.N. World Food Program, plus the overseas arms of the churches, synagogues, mosques and other volunteer agencies to provide a nutritious lunch every day for every school-age child in Afghanistan and other poor countries. Such a program is now underway in several countries approved by Congress and the United Nations, under the auspices of the George McGovern-Robert Dole International Food for Education and Child Nutrition Act. (Forgive the self-serving title.) Although the measure remains painfully underfunded, with the help of other countries, we are reaching millions of children. We could supplement these efforts with nutritional packages for low-income pregnant and nursing mothers and their infants from birth through the age of 5, as is done here at home by WIC, the Special Supplemental Nutrition Program for Women, Infants and Children.
Is this proposal pie-in-the-sky? I don't think so. It's food in the stomachs of hungry kids. It would draw them to school and enable them to learn and grow into better citizens. It would cost a small fraction of warfare's cost, but it might well be a stronger antidote to terrorism. There will always be time for another war. But hunger can't wait.
[Baca]
Global Research, January 22, 2009
On a recent visit to Tucson, Arizona, where I was invited to give a presentation on monetary reform, I was disturbed by a story of strange goings on in the desert. A little over a year ago, it seems, a new industrial facility sprang up on the edge of town. It was in a remote industrial zone and appeared to be a bus depot. The new enterprise was surrounded by an imposing security fence and bore no outward signs identifying its services. However, it soon became apparent that the compound was in the business of outfitting a fleet of prison buses. Thirty or so secondhand city buses were being reconfigured with prison bars in the windows and a coat of fresh paint bearing the “Wackenhut G4S” logo on the side.
The new Wackenhut operation is shrouded in mystery. It has been running its fleet of empty prison buses night and day, apparently logging miles on a Department of Homeland Security (DHS) contract. Multiple buses can be seen driving all over town and even on remote desert back roads. Oddly, except for the driver and one escort guard seated in front, these buses are always empty.
Wackenhut Services was founded by George Wackenhut in 1954 to provide prison guard services to state and federal governments. Wackenhut Services is now owned by the Danish corporation G4S.
Observers originally thought that the purpose of the new Wackenhut operation was to outfit prison buses to be distributed in other parts of the country. But it soon became apparent that none of the buses was leaving the Tucson depot. Recently, a passerby observed what appeared to be a training operation there. In what seemed to be strange activity for 10:30 PM on a Saturday night, the depot yard was fully illuminated, the entire fleet of buses was up and running, and drivers and guards were scrambling around the yard. The question is, what were they training for?
Wackenhut has never officially announced itself to the community, and the local news media have never mentioned its presence. Hiring has been discreetly conducted via the Internet, and an apathetic general public has taken little notice. Among the few who have noticed, one theory is that the prison bus depot is simply infrastructure for border security. But if so, where are the illegal aliens? Why are these buses always empty? What is the alleged justification for burning thousands of gallons of diesel fuel to run thirty decrepit, smoking buses night and day without passengers?
There is another interesting piece to this puzzle. On the desolate plain between Phoenix and Tucson is a tiny town called Florence, Arizona, which features a population consisting largely of prisoners. For decades, Florence has been the home of two of the largest county and federal prisons in the state; and in 2007, a vast new DHS prison was built there as well. Like the Wackenhut buses, this shiny new facility, which literally disappears into the horizon, has gone unannounced and unnoticed by the general public. A new facility for imprisoning illegal aliens? It is hard to imagine such expensive infrastructure being built for that purpose when U.S. policy has been to simply return illegals to their home countries.
Fraud and waste aside, this mysterious activity has sinister implications. Why the obvious secrecy? Since the World Trade Center disaster in 2001, the Department of Homeland Security has grown to monster proportions, claiming a projected $50 billion of the federal budget in 2009. DHS includes the Federal Emergency Management Agency (FEMA), which earned notoriety in 2005 for its gross mishandling of the Katrina disaster in New Orleans. Al Martin, a retired naval intelligence officer and former contributor to the Presidential Council of Economic Advisors, has linked the remilitarization of FEMA to the civil unrest anticipated along with economic collapse. He wrote in a November 2005 newsletter called “Behind the Scenes in the Beltway”:
“FEMA is being upgraded as a federal agency, and upon passage of PATRIOT Act III, which contains the amendment to overturn posse comitatus, FEMA will be re-militarized, which will give the agency military police powers. . . . Why is all of this being done? Why is the regime moving to a militarized police state and to a dictatorship? It is because of what Comptroller General David Walker said, that after 2009, the ability of the United States to continue to service its debt becomes questionable. Although the average citizen may not understand what that means, when the United States can no longer service its debt it collapses as an economic entity. We would be an economically collapsed state. The only way government can function and can maintain control in an economically collapsed state is through a military dictatorship.” [1]
All of this is quite ominous. It is also a good argument for considering radical funding alternatives. There are other ways to deal with the federal debt besides relying on the waning appetites of the Chinese and the Japanese for U.S. securities. Some innovative alternatives for funding both the federal debt and President Obama’s new economic stimulus package will be the subject of followup articles. Stay tuned.
Ellen Brown developed her research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest book, she turns those skills to an analysis of the Federal Reserve and “the money trust.” She shows how this private cartel has usurped the power to create money from the people themselves, and how we the people can get it back. Her earlier books focused on the pharmaceutical cartel that gets its power from “the money trust.” Her eleven books include Forbidden Medicine, Nature’s Pharmacy (co-authored with Dr. Lynne Walker), and The Key to Ultimate Health (co-authored with Dr. Richard Hansen). Her websites are www.webofdebt.com and www.ellenbrown.com.
[1] Al Martin, “FEMA, CILFs and State Security: Shocking Updates,” www.almartinraw.com (November 28, 2005)
[Baca]
Mahmoud Abbas stepped further into humiliation by saying the only option for Arabs is to make peace with Israel
January 21, 2009, The Independent
The front page of the Beirut daily As-Safir said it all yesterday. Across the top was a terrible photograph of the bloated body of a Palestinian man newly discovered in the ruins of his home while two male members of his family shrieked and roared their grief. Below, at half the size, was a photograph from Israel of Western leaders joking with Ehud Olmert, the Israeli Prime Minister. Olmert was roaring with laughter. Silvio Berlusconi, arms on the back of Olmert's shoulders, was also joshing and roaring – with laughter, not grief – and on Olmert's right was Nicolas Sarkozy of France wearing his stupidest of smiles. Only Chancellor Merkel appeared to understand the moral collapse. No smiles from Germany.
Europe laughs while Palestinians mourn their dead. No wonder that in the streets of Beirut, shops were doing a flourishing trade in Palestinian scarves and flags. Even some of Palestine's most serious enemies in Lebanon wore the Palestinian keffiyeh in solidarity with the people of Gaza. Over and over again, Al-Jazeera television strapped headlines on to their news reports of Palestinians carrying the decomposing corpses of their dead: "More than 1,300 dead in Gaza, 400 of them women and children – Israeli dead in the war 13, three of them civilians." That, too, said it all.
All day, the Arabs also had to endure watching their own leaders primping and posing in front of the cameras at the Arab summit in Kuwait, where the kings and presidents who claim to rule them also smiled and shook hands and tried to pretend that they were unified behind a Palestinian people who have been sorely betrayed. Even Mahmoud Abbas was there, the powerless, impotent leader of "Palestine" – where is that precisely, one had to ask? – trying to suck some importance from the coat-tails and robes of his betters.
Slipping and sliding on the corpses of Gaza, these assembled supreme beings should perhaps be pitied. What else could they do? Saudi King Abdullah announced £750,000 to rebuild Gaza; but how many times have the Arabs and the Europeans been throwing money at Gaza only to see it torn to shreds by incoming shell-fire?
It has to be said that the two cowled Hamas gunmen who announced that they had won a "victory" in the ruins of Gaza were only fractionally less hypocritical. Still they had not understood that they were not the Hizbollah of Lebanon. Gaza was no longer Beirut. Now, it seemed, Gaza was Stalingrad. But whose uniforms did Hamas think they were wearing: German or Soviet?
"Israel has to understand," the good king said – as if the Israelis were listening – "that the choice between war and peace will not always stay open and that the Arab initiative (for Arab recognition in return for an Israeli withdrawal to the 1967 borders of Israel) that is on the table today will not stay on the table." He knew that "an eye for an eye ... did not say an eye for the eyes of a whole city". But how many times – how many bodies have to be pulled from the ruins – before the Saudis realise that time has run out?
The Israelis briskly dismissed land for peace in 2002 but yesterday they suddenly showed their interest again. "We continue to be willing to negotiate with all our neighbours on the basis of that initiative," the Israeli government spokesmen said – as if his own country's original rejection had never been thrown at the Arabs.
President Bashar al-Assad of Syria, of course, dismissed the whole initiative in Qatar last week as dead, insisting that Israel be declared a "terrorist entity". But Mahmoud Abbas stepped further into humiliation yesterday by announcing that the "only option" for Arabs was to make peace with Israel. It was Arab "shortcomings" that led to the failure of the 2002 Arab initiative. Not Israel's rejection, mark you. No, it was all the fault of the Arabs. And this from the leader of "Palestine".
No wonder America's man in Egypt – a certain Hosni Mubarak – repeated the tired old slogan that "peace in the Middle East is an imperative that cannot be delayed". And then the Emir of Kuwait invited Bashar and Hosni and King Abdullah of Jordan and the other King Abdullah of Saudi Arabia to have lunch together – the menu was not disclosed – to end their feuding.
Al-Jazeera showed the ever-more putrid bodies being tugged from beneath cross-beams and crushed concrete as these mighty potentates debated their little disputes. There was really no adequate comment for this charade.
[Baca]
Professor of International Law
Legal Advisor to the Palestinian Delegation to the Middle East Peace Negotiations (1991-93)
When the Oslo Document was originally presented by the Israeli government to the Palestinian Delegation to the Middle East Peace Negotiations in the Fall of 1992, it was rejected by the Delegation because it obviously constituted a bantustan. This document carried out Menachem Begin's disingenuous misinterpretation of the Camp David Accords--expressly rejected by U.S. President Jimmy Carter--that all they called for was autonomy for the people and not for the land too.
Soon thereafter, unbeknownst to the Delegation and to almost everyone else, the Israeli government opened up a secret channel of negotiations in Norway. There the Israeli government re-presented the document that had already been rejected by the Palestinian Delegation in Washington, D.C. It was this document, with very minor modifications, that was later signed at the White House on 13 September 1993.
Before the signing ceremony, I commented to a high-level official of the Palestine Liberation Organization: "This document is like a straight-jacket. It will be very difficult to negotiate your way out of it." This PLO official agreed with my assessment and responded: "Yes, you are right. It will depend upon our negotiating skill."
Of course I have great respect for Palestinian negotiators. They have done the best they can negotiating in good faith with the Israeli government that has been invariably backed up by the United States. But there has never been any good faith on the part of the Israeli government either before, during or after Oslo. Ditto for the United States.
Even if Oslo had succeeded, it would have resulted in the imposition of a bantustan upon the Palestinian People. But Oslo has run its course! Therefore, it is my purpose here today to chart a NEW DIRECTION for the Palestinian People to consider.
An agenda for an international legal response:
First, we must immediately move for the de facto suspension of Israel throughout the entirety of the United Nations System, including the General Assembly and all U.N. subsidiary organs and bodies. We must do to Israel what the U.N. General Assembly has done to the genocidal rump Yugoslavia and to the criminal apartheid regime in South Africa! Here the legal basis for the de facto suspension of Israel at the U.N. is quite simple:
As a condition for its admission to the United Nations Organization, Israel formally agreed to accept General Assembly Resolution 181 (II) (1947) (partition/Jerusalem trusteeship) and General Assembly Resolution 194 (III) (1948) (Palestinian right of return), inter alia. Nevertheless, the government of Israel has expressly repudiated both Resolution 181 (II) and Resolution 194 (III). Therefore, Israel has violated its conditions for admission to U.N. membership and thus must be suspended on a de facto basis from any participation throughout the entire United Nations System.
Second, any further negotiations with Israel must be conducted on the basis of Resolution 181 (II) and its borders; Resolution 194 (III); subsequent General Assembly resolutions and Security Council resolutions; the Third and Fourth Geneva Conventions of 1949; the 1907 Hague Regulations; and other relevant principles of public international law.
Third, we must abandon the fiction and the fraud that the United States government is an "honest broker." The United States government has never been an honest broker from well before the very outset of these negotiations in 1991. Rather, the United States has invariably sided with Israel against the Palestinians. We need to establish some type of international framework to sponsor these negotiations where the Palestinian negotiators will not be subjected to the continual bullying, threats, harassment, intimidation and outright lies perpetrated by the United States government.
Fourth, we must move to have the U.N. General Assembly impose economic, diplomatic, and travel sanctions upon Israel pursuant to the terms of the Uniting for Peace Resolution (1950), whose Emergency Special Session on Palestine is now in recess.
Fifth, the Provisional Government of the State of Palestine must sue Israel before the International Court of Justice in The Hague for inflicting acts of genocide against the Palestinian People in violation of the 1948 Genocide Convention!
Sixth, An International Criminal Tribunal for Israel (ICTI) can be established by the UN General Assembly as a "subsidiary organ" under article 22 of the UN Charter. Article 22 of the UN Charter states the UN General Assembly may establish such subsidiary organs as it deems necessary for the performance of its functions. The purpose of the ICTI would be to investigate and Prosecute suspected Israeli war criminals for offences against the Palestinian people.
On January 4, 2009, Nobel Peace Laureate, Mairead Maguire wrote to the UN Secretary General, Ban Ki-Moon and Father Miguel D'Escoto President of United Nations General assembly adding her voice to the many calls from International Jurists, Human rights Organizations, and individuals, for the UN General Assembly to seriously consider establishing an International Criminal Tribunal for Israel in view of the ongoing Israeli atrocities against the people of Gaza and Palestine.
Maguire said:
"In November 2008 I visited Gaza and was shocked at the suffering of the people of Gaza, being under 'siege' as they are for over two years. This collective punishment by the Israeli Government, has lead to a great humanitarian crisis. Collective punishment of the civilian community by the Israeli Government breaks the Geneva Convention, is illegal and is a war crime and crime against humanity.
"Instead of protecting the civilian community of Gaza and relieving their Suffering by lifting the 'siege', the Israeli military have carried out 7 days consecutive bombardment of civilians, by sea and air. Dropping Israeli bombs from the air and sea on unarmed civilians, many women and children, destroying mosques, hospitals, and and homes, and infrastructure, is illegal and constitutes war crimes. The deaths of people in Gaza is now over 600 with over 2,500 people injured - many women and children. The infrastructure of Gaza has been destroyed, and the people cut off from the world – including journalists, Humanitarian workers, locked out of Gaza, and unable to go to the aid of the people.
"The UN must help uphold Human rights and Justice for Palestinian People, by seriously considering establishing an International criminal tribunal for Israel, (ICTI) in order that Israeli Gov., be held accountable for war crimes."
NOTE: Professor Boyle's call for an International Criminal Tribunal on Israel is now being circulated by member states of the UN General Assembly.
Francis A. Boyle is a leading American professor, practitioner and advocate of international law. He was responsible for drafting the Biological Weapons Anti-Terrorism Act of 1989, the American implementing legislation for the 1972 Biological Weapons Convention. He served on the Board of Directors of Amnesty International (1988-1992), and represented Bosnia-Herzegovina at the World Court. Professor Boyle teaches international law at the University of Illinois, Champaign, author of, inter alia, World Politics and International Law, The Future of International Law and American Foreign Policy, Foundations of World Order, The Bosnian People Charge Genocide, The Criminality of Nuclear Deterrence, Palestine, Palestinians and International Law, Destroying World Order, Biowarfare & Terrorism, Breaking All the Rules, and Tackling America's Toughest Questions (forthcoming). He holds a Doctor of Law Magna Cum Laude as well as a Ph.D. in Political Science, both from Harvard University.
[Baca]
January 21, 2009
For a picture of the US real estate crisis, imagine New Orleans wrecked by Hurricane Katrina, and before the waters even begin to recede, a second Katrina hits.
The 1,120,000 lost US retail jobs in 2008 are a signal that the second stage of the real estate bust is about to hit the economy. This time it will be commercial real estate—shopping malls, strip malls, warehouses, and office buildings. As businesses close and rents decline, the ability to service the mortgages on the over-built commercial real estate disappears.
The over-building was helped along by the irresponsibly low interest rates, but the main impetus came from the slide of the US saving rate to zero and the rise in household indebtedness. The shrinkage of savings and the increase in debt raised consumer spending to 72% of GDP. The proliferation of malls and the warehouses that service them reflect the rise in consumer spending as a share of GDP.
Like the federal government, consumers spent more than they earned and borrowed to cover the difference. Obviously, this could not go on forever, and consumer debt has reached its limit.
Shopping malls are losing anchor stores, and large chains are closing stores and even going out of business altogether. Developers who borrowed to finance commercial ventures are in trouble as are the holders of the mortgages, derivatives and other financial junk associated with the loans.
The main source of the economic crisis is the infantile belief of US policymakers that an economy could be based on debt expansion. As offshoring moved jobs, incomes, and GDP out of the country, debt expanded to take the place of the missing income. When the offshored goods and services were brought back to be sold to Americans, the trade deficit rose, adding another level of financing for an economy that consumes more than it produces.
The growth of debt has outpaced the growth of real output. Yet, the solution offered by Obama’s economic team is to expand debt further. This is not surprising as Obama’s economic team consists of the very people who brought on the debt crisis. Now they are going to make it worse.
The unexamined question is: Who is going to finance the next wave of debt?
The US budget deficit for fiscal year 2009 already appears to be on a path to $2 trillion, and that is before Obama’s stimulus program. What we are looking at is a $3 trillion budget deficit if Obama’s program is enacted in time to impact the economy this year.
Foreign countries can finance a $500 billion US budget deficit out of their trade surpluses with the US. But foreigners do not have the funds to finance a US budget deficit in the trillions of dollars, and they would not finance such a deficit even if they had the funds. Foreigners are over-weighted in dollar holdings and prefer to lighten their holding than to add to them. America’s economic prospects are dim as are the dollar’s prospects as reserve currency. An annual budget deficit in the trillions of dollars makes the dollar’s prospects appear even dimmer.
The federal government’s likely solution to the debt problem will be to monetize the debt, that is, the government will finance its deficit by printing money. Debt will be inflated away. But for those Americans without jobs or whose incomes do not rise with inflation, life will be cruel.
Life is already cruel for Americans living on retirement savings. Not only has the stock market bust reduced their wealth by half, but also their remaining assets are producing no income. Interest rates are so low that debt instruments produce no income, and there are scant capital gains in the stock market. Retirees are living by consuming their capital.
America’s economic policy of low interest rates and debt expansion bodes ill for everyone living off their savings. Their future prospects are even worse as high inflation will destroy the value of their savings, especially if held in cash or debt instruments, including “safe” US Treasuries.
There are more intelligent ways to try to escape from the current crisis. However, the financial gangsters and their shills that Obama has put in charge of economic policy are thinking only of their own interest. What happens to the American people is not a concern.
A compassionate government would handle the crisis in this way:
The trillions of dollars in credit default swaps (CDS) should be declared null and void. These “swaps” are simply bets that financial instruments and companies will fail, and the bulk of the bets are made by people and institutions that do not hold the financial instruments or shares in the companies. The ideology that financial markets were self-regulating allowed illegal gambling free rein. There is no reason under the sun for taxpayers to bail out gamblers.
The bailout money, instead of being given to favored financial institutions to finance their acquisition of other institutions, should be used to refinance the defaulting mortgages. This would slow, if not stop, the growing inventory of foreclosed properties that is driving down home prices.
The mark-to-market rule should be suspended until the real values of the troubled properties and instruments can be determined. Suspension of the rule would prevent the failure of sound institutions and lessen the need for a bailout.
Interest rates have to be raised in order to encourage saving and to provide incomes to retirees.
To preserve the dollar’s status as reserve currency, a credible policy of reducing both budget and trade deficits must be announced. In the near term the budget deficit can be reduced by $500 billion by withdrawing from Iraq and Afghanistan and by cutting a bloated defense budget that represents the now unattainable goal of US world hegemony.
The trade deficit can be significantly reduced by bringing offshored jobs back to America. One way to do this is to tax corporations according to the value added to their output that occurs in the US. Corporations that produce their products for US markets abroad would have high tax rates; those that produce domestically would have low tax rates.
This approach to the economic crisis stands in marked contrast with the approach of the gangsters running US economic policy. The gangsters are using the crisis as an opportunity to steal from taxpayers and to finance their misdeeds and exorbitant salaries with Federal Reserve loans. Their shills among economists and the financial press tell the people that the solution is to fatten up the banks with funds so they will resume lending to an over-indebted public that will then return to the shopping malls.
This unrealistic approach to a serious crisis indicates a leadership crisis on top of an economic crisis.
[Baca]
WITH ATTENTION TURNING TO THE NEXT big economic stimulus package, questions are still swirling about our economic troubles. How did we get here? How do we get out? As usual, Washington has all the wrong answers. According to many politicians, we got here by not spending enough, not consuming enough, and not regulating enough.
Now government, like some mythical white knight, is going to ride in to save the day by blanketing the economy with dollars, hiring an army of new bureaucrats, creating make-work jobs, and sending everyone some form of a bailout check. The debate seems to focus on whether this will cost enough to save the economy, or if this is just a “down payment” with much more government spending to come. Talk like that would be comical, if the results weren’t going to be so tragic.
The results will be worsening economic woes until we learn our lesson. But instead Congress is behaving like drug addicts who must hit rock bottom before they are ready to face reality. They are playing foolish games with the economy now because they are thinking only of political expedience. This talk of job creation is a perfect example.
Contrary to the belief of many, the goal of the economy is not job creation. Jobs can be a sign of a healthy economy, as a high energy level can be a sign of a healthy body. But just as unhealthy substances can artificially give the addict that burst of energy that has nothing to do with health, artificially created jobs just exacerbate our problems. The goal of a healthy economy is productivity. Jobs are a positive outcome of that.
A “job” could be to dig a hole one day, and fill it back up the next, or perhaps the equivalent at a desk. This does no one any good. But the value in that paycheck ultimately has to come from taxing someone productive.
Some think this round-robin type of economic model is supposed to get us somewhere. Politicians and bureaucrats have already done their fair share to ensure that jobs in the private sector are prohibitively complicated and expensive to create. They are now shocked that the economy is shedding jobs, and want to simply create hundreds of thousands of jobs to make up for the job losses, through another so-called economic stimulus package.
The private sector must be permitted to do that, but instead they are massively burdened with taxes and webs of red tape and regulation.
Washington’s bandaids will only prolong this agony. The Austrian school of economics teaches that only a free market economy, unencumbered by onerous government controls, creates long-term prosperity. Politicians, however, tend to be notoriously short-sighted.
I am left with these questions—who is going to be left standing, to tax in the private sector, to pay for all these public sector make-work jobs? Is D.C. really to be some sort of savior for creating unproductive jobs in place of the productive jobs they eliminated?
We are at an economic dead-end and those in power are in denial. The truth is our economic problems are due to loose monetary policy, central economic planning, and the parasitic expenses of government. Unless we assess these problems honestly, we unfortunately have a long way to go until, like the junkie, we hit rock bottom.
Ron Paul, a medical doctor, is a Republican member of the U.S. Congress who represents the 14th District of Texas. Call his weekly update line toll free at 1-888-322-1414 or visit his website at www.ronpaul.org.
[Baca]
January 22, 2009 Mises Institute
On Thursday, January 8, 2009, US President-elect Barack Obama said,
I don't believe it's too late to change course, but it will be if we don't take dramatic action as soon as possible. If nothing is done, this recession could linger for years.
Most economists and various commentators are in agreement. They hold that the US government must sharply increase its spending in order to arrest the economic crisis that could turn into a prolonged slump.
According to the Congressional Budget Office (CBO), in the absence of a stimulus plan, the unemployment rate could jump to above 9% by early 2010. Some other experts are of the view that without the stimulus plan the unemployment rate could easily surpass the 10% mark.
Most experts hold that on account of the economic slump and the consequent underutilization of resources, economic output in the next two years will be strongly below the potential output. For 2009 and 2010, the production loss is estimated to be in excess of $2 trillion (the gap between the potential GDP and the actual GDP).
Therefore they believe that the effective way to close the gap between the potential output and the actual output is through the fiscal stimulus package — a large increase in government outlays.
Given the possibility that the gap could exceed the $2 trillion mark it seems that the Obama's fiscal stimulus plan of around $800 billion is not going to "do the trick."
Even if one were to allow for the so-called "multiplier effect," Obama's plan will not close the output gap and thus "fix" the problem, so it is held. In Obama's plan, only about $480 billion consists of public spending, which has a multiplier of around 1.5. (That is, a dollar of government expenditure supposedly raises GDP by around $1.5.) The rest of the package consists of tax cuts, which most experts don't believe would boost spending and thus activate the multiplier.
This way of thinking follows the ideas of John Maynard Keynes. In a nutshell, Keynes held that one cannot have complete trust in a market economy, which is inherently unstable. If left free, the market economy could lead to self-destruction. Hence there is the need for governments and central banks to manage the economy.
Successful management, in the Keynesian framework, is done by influencing the overall spending in an economy. It is spending that generates income. Spending by one individual becomes income for another individual.
What drives the economy then is spending. If during a recession consumers fail to spend, then it is the role of the government to step in and boost overall spending in order to grow the economy.
In the Keynesian framework, an output that an economy could generate without causing inflation, given a certain pool of resources — i.e., labor, tools, and machinery, and a given technology — is labeled potential output. Hence the greater the pool of resources, all other things being equal, the more output can be generated.
If, for whatever reasons, the demand for the produced goods is not strong enough, this leads to an economic slump. (Inadequate demand for goods leads to only a partial use of existent labor and capital goods.)
In this framework then, it makes a lot of sense to boost government spending in order to strengthen demand and eliminate the economic slump.
What is missing in this story is the matter of funding. For instance, a baker produces ten loaves of bread and exchanges them for a pair of shoes with a shoemaker. In this example, the baker funds the purchase of shoes by producing ten loaves of bread.
Note that the bread maintains the shoemaker's life and well-being. Likewise, the shoemaker has funded the purchase of bread by means of shoes that maintain the baker's life and well-being.
Now, the baker has decided to build another oven in order to increase the production of bread. In order to implement his plan, the baker hires the services of the oven maker.
He pays the oven maker with some of the bread he is producing. Again, what we have here is a setup where the building of the oven is funded by the production of a final consumer good — bread. If, for whatever reasons, the flow of bread production were disrupted, the baker would not be able to pay the oven maker. As a result, the making of the oven would have to be aborted.
From this simple example we can infer that what matters for economic growth is not just the existing stock of tools and machinery and the pool of labor but the adequate flow of final goods and services that maintains individuals' lives and well-being.
Now, even if we were to accept the Keynesian framework that the potential output is above the actual output, it doesn't follow that the increase in government outlays will lead to an increase in the economy's actual output.
It is not possible to lift overall production without the necessary support from final goods and services or from the flow of real funding or the flow of real savings. (For instance, out of the production of ten loaves of bread, if the baker consumes two loaves, his real saving or real funding is eight loaves.)
We have seen that by means of a final consumer good — the bread — the baker was able to fund the expansion of his production structure.
Similarly, other producers must have final, saved, real consumer goods — real savings — to fund the purchase of goods and services they require. Note that the introduction of money doesn't alter the essence of what funding is. (Money is just a medium of exchange. It is only used to facilitate the flow of goods; it cannot replace the final consumer goods.)
The government as such doesn't create any real wealth, so how can an increase in government outlays revive the economy?
Various individuals who will be employed by the government will expect compensation for their work. The only way it can pay these individuals is by taxing others who are still generating real wealth. By doing this, the government weakens the wealth-generating process and undermines prospects for economic recovery. (We ignore here borrowings from foreigners.)
The only way fiscal stimulus could "work" is if the flow of real savings (i.e., real funding) is large enough to support (i.e., fund) government activities while still permitting a positive rate of growth in the activities of the private sector. (Note that the overall increase in real economic activity is, in this case, erroneously attributed to the government's loose fiscal policy.)
If, however, the flow of real savings is not large enough, then, regardless of any increase in government outlays, overall real economic activity cannot be revived.
In this case the more government spends (i.e., the more it takes from wealth generators), the more it weakens prospects for a recovery.
Thus when government, by means of taxes, diverts bread to its own activities, the baker will have less bread at his disposal. Consequently, the baker will not be able to secure the services of the oven maker. As a result, it will not be possible to boost the production of bread, all other things being equal.
As the pace of government spending increases, a situation could emerge where the baker will not have enough bread even to maintain the existing oven. (The baker will not have enough bread to pay for the services of an oven-maintenance technician.) Consequently, his production of bread will actually decline.
Similarly, other wealth generators, as a result of the increase in government outlays, will have less real funding at their disposal. This, in turn, will hamper the production of their goods and services, thereby retarding, not promoting, overall real economic growth.
As one can see, not only does the increase in government outlays not raise overall output by a positive multiple; but, on the contrary, this leads to the weakening in the process of wealth generation in general. According to Ludwig von Mises, there is need to emphasize the truism that a government can spend or invest only what it takes away from its citizens and that its additional spending and investment curtails the citizens' spending and investment to the full extent of it quantity. (Human Action, chapter 29, section 1)
[Baca]
Global Research, January 22, 2009
During the end of the 1970’s into the 1980’s British Conservative Prime Minister Margaret Thatcher and the City of London financial interests who backed her, introduced wholesale measures of privatization, state budget cuts, moves against labor and deregulation of the financial markets. She did so in parallel with similar moves in the USA initiated by advisers around President Ronald Reagan. The claim was that hard medicine was needed to curb inflation and that the bloated state bureaucracy was a central problem. For almost three decades, Anglo-American university economic faculties have turned to Thatcherite deregulation of financial markets as ‘the efficient way,’ in the process, undoing many of the hard-fought gains secured for personal social security, public health care and pension security of the population. Now the ‘poster child’ economy of the Thatcher Revolution, Great Britain, is sinking like the proverbial Titanic, a testimony to the incompetence of what is generally called Neo-liberalism or free market ideology.
As the Neo-liberal revolution began in the economies of the USA and UK, it should not be not surprising that the epi-center of catastrophe in the global crisis now unfolding also lies with the economies of the USA and UK, as well as a handful of economies, including Ireland Canada, Australia, New Zealand and Iceland, all of which embraced the free market Thatcherite agenda most strongly in recent years. Notably, the man who personally implemented Thatcherite financial market reforms and deregulation during the era of Tony Blair in Britain was Gordon Brown, then Treasury Secretary.
A sample of most recent British developments is instructive. Britain's economy is about to suffer its most vicious slump since 1946, shrinking by a drastic 2.8 per cent this year, according to EU latest estimates. The UK is predicted to suffer the worst recession of any large European economy.
The consequences for the UK will include soaring unemployment, while the economy also teeters on the brink of full-blown deflation. Unemployment will rise by more than 900,000 people over the next 12 months, driving the jobless total to 2.55 million by the end of the year, or 8.2 per cent of the workforce, from 5.3 per cent at present.
In parallel, the currency, the Pound, which is not part of the Eurozone currencies, has fallen dramatically against the Euro and even the US dollar in recent weeks over growing fears of the collapsing UK economy and banking system. Sterling has fallen below $1.40 to its lowest point in seven and a half years because of concerns about the depth of Britain's banking crisis and the Government's rising debt levels. This coming year the UK Government's borrowing levels may exceed £118 billion, equal to 8 per cent of GDP.
Britain will not be able to reap much benefit from a lower pound for exports because, as part of the Thatcher Revolution, the national economy has out-sourced, de-industrialized and turned to a service economy where, as in the USA, finance and banking became the motor of economic growth the past two decades. That motor has now broken.
Public debt soaring
Fuelled by the cost of state bank bailouts, the UK's national debt is set to rise to £1.06 trillion, or 72 per cent of GDP, by 2010, a sharp rise of more than 70% from present levels.
Yesterday, the Gordon Brown Government, only three months ago hailed as the place which was taking effective action to control the global financial meltdown, was forced to introduce yet another new bank bailout package of measures designed to rescue the country's banking sector. He refused to put any ceiling on the amount that he might ultimately need, creating great distrust in the Brussels and across the EU.
Combined, British banks have some $4.4 trillion of foreign liabilities. That is twice the size of the British economy. UK foreign reserves are virtually nothing at $60.6 billion. Little wonder that savvy currency traders and hedge funds have decided the British Pound can go only one way, down. Swap markets for CDS now price in an alarming 10% probability of Britain having to default on state debt obligations in the next few years as public debt explodes.
The last time England had a default on state debt in the early 14th Century when King Edward III decided to declare default on his then huge debts to the large Italian banking house of Bardi & Peruzzi, taking the large bank down with it and spreading ruin across Europe.
‘…giving the kiss of life to a corpse'
The Brown Government admits it does not know whether the second bank rescue package it just launched will work, senior ministers admit. One minister is quoted anonymously in the British press, ‘The truth is that we can't be sure whether it will be effective. We have to look calm to try to instil some confidence in the system. But we don't know what will happen next. No one can be sure that this is the end of it. We are in completely uncharted waters. The position is changing all the time.’ In brief, the authorities have lost control in the UK.
Gordon Brown and Treasury Secretary Alistair Darling claim the second bailout did not mean the first package they unveiled last October had failed. That deal, they insist, was about preventing banks from going bust; this one was about ensuring they had the confidence to lend to businesses and the public.
The Government refuses to reveal how much it would cost taxpayers. Officials dismissed talk of a £200bn bailout, saying some measures had a low risk and figures were still being calculated. Labour backbenchers conceded it would be difficult to "sell" the rescue plan to an increasingly hostile public. Not surprisingly, polls have turned dramatically against Labour and Brown, now showing that were elections held today, the Conservative Party would win a gain over Labour of 9% to 13 %. An astonishing 49% of all Brotins fear losing their job this year as well.
A major impediment to swift and consequent Government action to contain the impact of the banking crisis has been the dominance of Thatcherite ideology as an almost religious dogma that permeates even Labour, where Tony Blair was portrayed as a Labour version of Thatcher. The ideological absurdity of the situation was underscored recently when the Conservative opposition offered broad support for yesterday's measures, even though their concern over soaring borrowing led them to oppose the Government's £20bn fiscal stimulus designed to keep the economy moving.
As well, it is clear, following the nationalization last year of Northern Rock and the forced state share of 70% in the large Royal Bank of Scotland, that a type of approach as that used in the early 1990’s Swedish banking crisis, in which the State nationalized banks that were insolvent and unable to raise private capital. Sweden then split the banks into ‘good bank’ and ‘bad bank.’ In the good bank, business of lending to the real economy continued unabated. The assets in the bad bank, largely illiquid Swedish real estate holdings, were held by the state until economic growth again allowed the government to sell the assets in a healthy market. The ultimate taxpayer cost of the Securum model were estimated to have been zero or even a tiny profit when all costs were factored.
The ideological Labour government is stubbornly refusing to admit the logic of the situation, and ends up ‘cutting the dog’s tail off by inches.’ As certain Labour MPs call for the full nationalisation of the banks the Government says that is not its goal. Chancellor Darling stated, ‘We have a clear view that British banks are best managed and owned commercially and not by the Government. That remains our policy.’
John McFall, Labour chairman of the Treasury Select Committee, who believes full nationalisation of the banks is inevitable, asked Darling in recent House of Commons debate if the Government would take a 100 per cent stake in the banks if the new package did not restart lending. Vince Cable, Treasury spokesman for the Liberal Democrats, said, ‘The Government increasingly resembles somebody who is trying to give the kiss of life to a corpse. The Government now effectively controls one of the largest banks in the world. It will almost certainly have to put more money in; it may well acquire other banks.’ Cable had also predicted the bursting of the house price and personal debt bubbles – and the nationalisation of Northern Rock.
Royal Bank of Scotland next
The same day Brown’s Government announced the second bank bailout attempt, Royal Bank of Scotland issued a statement revealing it expects losses of £28bn for 2008, far greater than anyone was expecting, and triggered further selloff in all major British banks. The huge losses announced at RBS were mainly the result of its acquisition of ABN Amro in 2007. RBS paid a high price for ABN and yesterday admitted that the business was worth around £20bn less than it had previously thought. This unexpected announcement resulted in a 67 per cent fall in its shares.
Brown, in a pathetic attempt to deflect blame, has said that he was particularly 'angry' at the record losses racked up by the Royal Bank of Scotland, and the large write-offs of foreign debt. Lloyds Bank is rumored to be the next bank in need of emergency help as the economy of Britain goes into free-fall, the tragic eulogy to Thatcherism.
Origins of the neo-liberal model
The so-called neo-liberal finance model which was espoused by the Thatcher government after 1979 had its origins in a decision by leading Anglo-American financial powers and their circle that it was time to begin a wholesale clawing back of the concessions which they had granted under, as they saw it, duress, during the great depression of the 1930’s and in the case of Britain the postwar economic difficulties.
The origins of the effort in the United States go back to a seminal little known book by a scion of the vastly wealthy Rockefeller family, the late John D. Rockefeller III, titled The Second American Revolution. There, amid soporific rhetoric about creation of a ‘humanistic capitalism’ he calls for drastic reduction in the role and size of government in the economy. That theme was then propagated through the efficient propaganda apparatus of the Rockefeller imperium, aided by the economist guru of the Rockefellers’ University of Chicago, Milton Friedman.
Amid the misnamed ‘stagflation’ sluggish growth high inflation era of the late 1970’s into the 1980’s, that propaganda machine, conveniently ignoring the pivotal role of the manipulated oil shocks, shocks incidentally manipulated and brought about by the same Rockefeller family, as I detail in A Century of War: Anglo-American Oil Politics, blamed all ills on ‘big government.’ Rockefeller protégé, Paul Volcker of Chase Manhattan Bank was sent to Jimmy Carter on orders of David Rockefeller, to ‘wring inflation out of the system’ in October 1979, the same general time Thatcher’s Bank of England imposed its own form of economic ‘shock therapy.’
True economic causality was obscured and reams of press copy from the Friedmanite free market camp, during the Reagan and Thatcher era claimed that the ‘defeat of inflation’ had been due to the ruthless discipline of Volcker and Thatcher. That was, we were told, again and again, the reason why the market should be unfettered from government regulation, freed to the devices of its own unbounded innovative genius. The results of that unfettered ‘humanistic capitalism’ or what Alan Greenspan approvingly called the ‘revolution in finance’ is now bringing both meccas of neo-liberalism, the United States and Great Britain to economic ruin. Somewhere between this and Stalin’s Soviet central planning there lies a better way.
F. William Engdahl is author of A Century of War: Anglo-American Oil Politics and the New World Order (Pluto Press) and Seeds of Destruction: The Hidden Agenda of Genetic Manipulation (www.globalresearch.ca). The present article is adapted from his forthcoming book, due in summer 2009, Power of Money: The Rise and Decline of the American Century. He may be contacted through his website, www.engdahl.oilgeopolitics.net.
[Baca]
Global Research, January 20, 2009
Across the land, an atmosphere of hope and optimism prevails. The Bush regime has gone. A new president is in the White House.
While America had its eyes riveted on the live TV broadcast of Barack Obama's presidential inauguration, financial markets were sliding.
A major "market correction" had occurred. Removed from the public eye, virtually unnoticed, a new stage of the financial crisis has unfolded.
Immediately following the inauguration, the Dow Jones plummeted, largely affecting the share prices of major financial institutions.
The quoted stock values of major Wall Street banks plummeted. Citigroup fell by 20 percent, Bank of America by 29 percent and JP Morgan Chase by 20 percent. The Royal Bank of Scotland fell by 69 percent in New York trading.
The difficulties and book value losses of major banks were known well in advance of the inauguration of President Obama.
So why now?
The inauguration of a president Obama was expected to provide confidence to financial markets. Exactly the opposite occurred.
There was nothing spontaneous and accidental in this collapse of the stock values of major financial institutions.
Obama's speech outside the Capitol, had been drafted well in advance. Its contents was carefully prepared.
President Obama made explicit reference to the global economy's woes, while emphasizing that: "without a watchful eye, the market can spin out of control."
"Obama warned the economic recovery would be difficult and that the nation must choose "hope over fear, unity of purpose over conflict and discord" to overcome the worst economic crisis since the Great Depression." (Associated Press, January 20, 2009)
There were "high expectations" on Wall Street. Many Wall Street brokers, who were not privy to the contents of Obama's speech, were "betting" President Obama's statements would help stabilize financial markets.
Those who drafted Obama's speech were fully aware of its possible financial repercussions.
"High expectations for details on how the new administration would address the growing banking crisis and faltering economy were dampened after the inauguration speech."(Reuters, Jan 20, 2009)
Coincidentally, the chairman of the Securities and Exchange Commission, Christopher Cox, appointed by Bush in 2005, resigned on the very same day of the presidential inauguration, leading to vacuum in the adoption of crucial financial regulatory decisions. His successor, Mary Shapiro, will only take office following lengthy Senate confirmation hearings.
Those who had advanced knowledge and/or inside information regarding the text of Obama's speech and who had the ability to "move the market" at the right time and the right place, stood to gain in the conduct of major speculative transactions on stock markets and currency exchanges.
Were these speculative transactions planned in advance of January 20th? (See Video)
Was there a concerted and deliberate effort to "short the market" on the very same day as the presidential inauguration?
On currency markets, the movement was in reverse, the US dollar was rising, the Euro, the British Pound and the Canadian dollar were plummeting. Canada's Central Bank Governor chose the date of the presidential inauguration to announce a cut in the interest rate in an apparent "bid to stimulate the economy and boost lending to consumers and businesses". The impact: the Canadian dollar declined dramatically in relation to Greenback.
Were have All the Creditors Gone?
The largest financial institutions are said to be in troubled waters, indebted to unnamed creditors. Since the onslaught of the financial meltdown, the identity of the creditors remains a mystery.
Over the years, the financial establishment has set up private hedge funds invariably registered in the name of wealthy individuals. Large amounts of wealth have been transferred from the large financial institutions to these privately owned hedge funds, which largely escape government regulation.
Why are the banks indebted? To whom? Are they the victims or the recipients? Are they the debtors or the creditors?
America's largest banks have, over the years, sifted off part of their surplus profits to various proxy financial outfits, hedge funds, accounts registered in tropical offshore banking havens, etc.
While these billion dollar transfers are conducted electronically from one financial entity to another, the identity of the creditors is never mentioned. Who is collecting these multibillion debts which are in large part the consequence of financial manipulation?
The collapse in bank stock market values was in all likelihood known in advance. The banks had already moved their loot to a safe financial haven.
The banks are in troubled water after having received hundred of billions of dollars of bailout money.
Where is the bailout money going? Who is cashing in on the multibillion dollar government bailout money? This process is contributing to an unprecedented concentration of private wealth.
The financial press acknowledges the existence of billions of dollars of "inter bank debt". But not a word is mentioned about the creditors.
For every debtor, there is a creditor.
Is this not money which the financial elites owe to themselves?
Whoever holds these trillions will eventually pick up the pieces. They will transform their enormous paper wealth into the acquisition of real assets.
Waking up the Day After
And the day after the hopes and promises of the presidential inauguration, Middle Class Americans who had invested in "safe" bank shares, will come to realize that part of their lifelong savings have once again been confiscated.
[Baca]
January 22, 2009 The Independent UK
It would have helped if Obama had the courage to talk about what everyone in the Middle East was talking about. No, it wasn't the US withdrawal from Iraq. They knew about that. They expected the beginning of the end of Guantanamo and the probable appointment of George Mitchell as a Middle East envoy was the least that was expected. Of course, Obama did refer to "slaughtered innocents", but these were not quite the "slaughtered innocents" the Arabs had in mind.
There was the phone call yesterday to Mahmoud Abbas. Maybe Obama thinks he's the leader of the Palestinians, but as every Arab knows, except perhaps Mr Abbas, he is the leader of a ghost government, a near-corpse only kept alive with the blood transfusion of international support and the "full partnership" Obama has apparently offered him, whatever "full" means. And it was no surprise to anyone that Obama also made the obligatory call to the Israelis.
But for the people of the Middle East, the absence of the word "Gaza" - indeed, the word "Israel" as well - was the dark shadow over Obama's inaugural address. Didn't he care? Was he frightened? Did Obama's young speech-writer not realise that talking about black rights - why a black man's father might not have been served in a restaurant 60 years ago - would concentrate Arab minds on the fate of a people who gained the vote only three years ago but were then punished because they voted for the wrong people? It wasn't a question of the elephant in the china shop. It was the sheer amount of corpses heaped up on the floor of the china shop.
Sure, it's easy to be cynical. Arab rhetoric has something in common with Obama's clichés: "hard work and honesty, courage and fair play ... loyalty and patriotism". But however much distance the new President put between himself and the vicious regime he was replacing, 9/11 still hung like a cloud over New York. We had to remember "the firefighter's courage to storm a stairway filled with smoke". Indeed, for Arabs, the "our nation is at war against a far-reaching network of violence and hatred" was pure Bush; the one reference to "terror", the old Bush and Israeli fear word, was a worrying sign that the new White House still hasn't got the message. Hence we had Obama, apparently talking about Islamist groups such as the Taliban who were "slaughtering innocents" but who "cannot outlast us". As for those in the speech who are corrupt and who "silence dissent", presumably intended to be the Iranian government, most Arabs would associate this habit with President Hosni Mubarak of Egypt (who also, of course, received a phone call from Obama yesterday), King Abdullah of Saudi Arabia and a host of other autocrats and head-choppers who are supposed to be America's friends in the Middle East.
Hanan Ashrawi got it right. The changes in the Middle East - justice for the Palestinians, security for the Palestinians as well as for the Israelis, an end to the illegal building of settlements for Jews and Jews only on Arab land, an end to all violence, not just the Arab variety - had to be "immediate" she said, at once. But if the gentle George Mitchell's appointment was meant to answer this demand, the inaugural speech, a real "B-minus" in the Middle East, did not.
The friendly message to Muslims, "a new way forward, based on mutual interest and mutual respect", simply did not address the pictures of the Gaza bloodbath at which the world has been staring in outrage. Yes, the Arabs and many other Muslim nations, and, of course, most of the world, can rejoice that the awful Bush has gone. So, too, Guantanamo. But will Bush's torturers and Rumsfeld's torturers be punished? Or quietly promoted to a job where they don't have to use water and cloths, and listen to men screaming?
Sure, give the man a chance. Maybe George Mitchell will talk to Hamas - he's just the man to try - but what will the old failures such as Denis Ross have to say, and Rahm Emanuel and, indeed, Robert Gates and Hillary Clinton? More a sermon than an Obama inaugural, even the Palestinians in Damascus spotted the absence of those two words: Palestine and Israel. So hot to touch they were, and on a freezing Washington day, Obama wasn't even wearing gloves.
[Baca]
THE POWERFUL JEWISH LOBBY in Washington is already issuing marching orders to President-elect Barack Obama. One of the most influential voices of the lobby has published an array of “working papers” designed to tell the president how he must maintain the “special relationship” between the United States and Israel, increase pressure on a variety of Arab and Muslim states that are perceived as dangers to Israel, and generally assure that Israel’s interests will always be first and foremost in the conduct of U.S. foreign policy, not only in the Middle East but around the globe.
The Jewish Institute for National Security Affairs (JINSA), a particularly vocal force in the Jewish lobby, published an entire edition of its Journal of International Security Affairs (dated fall 2008), sending the official word to Obama. JINSA was founded by one Stephen Bryen who—along with a host of other well known names connected to JINSA—was once investigated by the FBI on charges of espionage for Israel.
A variety of articles in the journal addressing “Middle East Policy and the Next President” and “Iran, Iraq and Beyond,” make it clear that JINSA—best known as a nest of the infamous “neo-conservatives” who misdirected U.S. foreign policy during the outgoing Bush administration, sparking the war in Iraq and continuing to clamor for action against Iran—wants Obama to pursue Bush-style policies.
AIPAC is particularly obsessed with using U.S. military and economic power to force Arab and Muslim nations to “reform” from within. Talk of “democracy” flows freely within AIPAC’s assorted essays, demanding that Israel’s neighbors conform to the Western version of democracy. But when the Palestinian people voted the Hamas movement into power in the Palestinian Authority in the occupied West Bank and the Gaza strip, AIPAC and other elements in the Jewish lobby immediately began calling for the United States to reject that freely elected government.
Now, of course, Hamas is largely only in control of the beleaguered Gaza—which many refer to as “ghetto”— and the Palestinian statehood movement has been eviscerated, at least for now. This makes AIPAC and the lobby for Israel quite happy, for Israel has long encouraged U.S. policies—and helped create conditions—that have the effect of “divide and conquer” in the Arab and Muslim world.
Israel is not like any other nation in the world, in that it seems to thrive best (and enjoys the benefits of) having its neighbors quarreling among themselves and rent within. Other nations prefer neighbors that are peaceful and internally secure. Israel wants its neighbors in chaos, because this prevents them from waging war against Israel, either individually or united. And although in the wake of the debacle in Iraq, which led many Israelis and their allies in the United States to suddenly proclaim that the Iraq war should never have been waged, the fact is that Israel and its U.S.-based agents-in-place were the prime movers behind that war and it was Israeli intelligence that was providing what critics now recognize was the “bad intelligence” that led the Bush administration to “mistakenly” conclude that Iraq was working toward an assembly of nuclear weapons to rival that of Israel.
The Israelis and their American spokesmen evidently now believe that if they tell the “big lie” often enough—the lie that Israel’s interests played no part in orchestrating the debacle in Iraq—that it will make Americans forget that Israel was the foremost advocate of the war in the first place.
However, the evisceration of Iraq by the United States is part and parcel of a long-standing Israeli national security policy aimed toward “balkanizing” the Muslim world.
Yet, AIPAC, in its journal, is now working to perpetuate the myth of Iraqi nuclear weapons and suggesting that Iraq’s weapons were transported into Syria, another nation which has been on the “wish list for war” of Israel and its lobby in America. And AIPAC makes it clear that the destruction of Iran’s nuclear development program is a “must.”
AIPAC is not the only Israeli lobby unit sending the message to the new president. Commentary magazine, long affiliated with the American Jewish Committee, has—in recent issues—been trumpeting a similar bellicose refrain directed at Obama. The editorial director of the Jewish lobby journal is John Podhoretz, a longtime close personal and political associate of the ubiquitous William Kristol, editor of the Weekly Standard magazine, which is the most infamous voice of the neo-conservative, hard-line pro-Israel elements operating in the media, in the think tanks, and in official policy making and national security and intelligence circles in Washington.
Their fathers, Irving Kristol and Norman Podhoretz, are two of the founding fathers of the neoconservative network, both Trotskyite Marxists who announced their “conversion” to conservatism during the latter days of the Cold War, banging the drum for intensified U.S. support for Israel.
A complete overview of the neo-conservative power structure and its rather bizarre origins in the days when American Jewish communists like Kristol and Podhoretz turned on the Soviet Union when then- Soviet chief Josef Stalin began moving against Jewish and Zionist elements inside Russia can be found in The High Priests of War and The Judas Goats, two works by this author.
Whether President Obama intends real change, as he promised, or whether he will advance the Israeli agenda (which saw its power expand exponentially in the Republican administration of George W. Bush) remains to be seen. But “the lobby” is making its voice heard and Obama knows that he better not ignore it.
A journalist specializing in media critique, Michael Collins Piper is the author of The High Priests of War, The New Jerusalem, Dirty Secrets, The Judas Goats, The Golem, Target Traficant and My First Days in the White House All are available from AFP.
[Baca]
January 22, 2009 Commondreams
RAFAH - Traffic on Sea Street, a major thoroughfare alongside Gaza's coastline, includes horses, donkeys pulling carts, cyclists, pedestrians, trucks and cars, mostly older models. Overhead, in stark contrast to the street below, Israel's ultra modern unmanned surveillance planes criss-cross the skies. F16s and helicopters can also be heard. Remnants of their deliveries, the casings of missiles, bombs and shells used during the past three weeks of Israeli attacks, are scattered on the ground.
Workers have cleared most of the roads. Now, they are removing massive piles of wreckage and debris, much as people do following an earthquake.
"Yet, all the world helps after an earthquake," said a doctor at the Shifaa hospital in Gaza. "We feel very frustrated," he continued. "The West, Europe and the U.S., watched this killing go on for 22 days, as though they were watching a movie, watching the killing of women and children without doing anything to stop it. I was expecting to die at any moment. I held my babies and expected to die. There was no safe place in Gaza."
He and his colleagues are visibly exhausted, following weeks of work in the Intensive Care and Emergency Room departments at a hospital that received many more patients than they could help. "Patients died on the floor of the operating room because we had only six operating rooms," said Dr. Saeed Abuhassan, M.D, an ICU doctor who grew up in Chicago. "And really we don't know enough about the kinds of weapons that have been used against Gaza."
In 15 years of practice, Dr. Abuhassan says he never saw burns like those he saw here. The burns, blackish in color, reached deep into the muscles and bones. Even after treatment was begun, the blackish color returned.
Two of the patients were sent to Egypt because they were in such critical condition. They died in Egypt. But when autopsies were done, reports showed that the cause of death was poisoning from elements of white phosphorous that had entered their systems, causing cardiac arrests.
In Gaza City, The Burn Unit's harried director, a plastic surgeon and an expert in treating burns, told us that after encountering cases they'd never seen before, doctors at the center performed a biopsy on a patient they believed may have suffered chemical burns and sent the sample to a lab in Egypt. The results showed elements of white phosphorous in the tissue.
The doctor was interrupted by a phone call from a farmer who wanted to know whether it was safe to eat the oranges he was collecting from groves that had been uprooted and bombed during the Israeli invasion. The caller said the oranges had an offensive odor and that when the workers picked them up their hands became itchy.
Audrey Stewart had just spent the morning with Gazan farmers in Tufaa, a village near the border between Gaza and Israel. Israeli soldiers had first evacuated people, then dynamited the houses, then used bulldozers to clear the land, uprooting the orange tree groves. Many people, including children, were picking through the rubble, salvaging belongings and trying to collect oranges. At one point, people began shouting at Audrey, warning her that she was standing next to an unexploded rocket.
The doctor put his head in his hands, after listening to Audrey's report. "I told them to wash everything very carefully. But these are new situations. Really, I don't know how to respond," he said.
Yet he spoke passionately about what he knew regarding families that had been burned or crushed to death when their homes were bombed. "Were their babies a danger to anyone?" he asked us.
"They are lying to us about democracy and Western values," he continued, his voice shaking. "If we were sheep and goats, they would be more willing to help us."
Dr. Saeed Abuhassan was bidding farewell to the doctors he'd worked with in Gaza. He was returning to his work in the United Arab Emirates. But before leaving, he paused to give us a word of advice. "You know, the most important thing you can tell people in your country is that U.S. people paid for many of the weapons used to kill people in Gaza," said Dr. Saeed Abuhassan. "And this, also, is why it's worse than an earthquake."
Kathy Kelly ( kathy@vcnv.orgThis e-mail address is being protected from spambots. You need JavaScript enabled to view it ) is a co-coordinator of Voices for Creative Nonviolence ( www.vcnv.org ) She and Audrey Stewart have been in Gaza for the past six days.
[Baca]
The Gaza Bombshell
After failing to anticipate Hamas’s victory over Fatah in the 2006 Palestinian election, the White House cooked up yet another scandalously covert and self-defeating Middle East debacle: part Iran-contra, part Bay of Pigs. With confidential documents, corroborated by outraged former and current U.S. officials, the author reveals how President Bush, Condoleezza Rice, and Deputy National-Security Adviser Elliott Abrams backed an armed force under Fatah strongman Muhammad Dahlan, touching off a bloody civil war in Gaza and leaving Hamas stronger than ever.
January 21, 2009 "Vanity Fair"
April 2008 -- The Al Deira Hotel, in Gaza City, is a haven of calm in a land beset by poverty, fear, and violence. In the middle of December 2007, I sit in the hotel’s airy restaurant, its windows open to the Mediterranean, and listen to a slight, bearded man named Mazen Asad abu Dan describe the suffering he endured 11 months before at the hands of his fellow Palestinians. Abu Dan, 28, is a member of Hamas, the Iranian-backed Islamist organization that has been designated a terrorist group by the United States, but I have a good reason for taking him at his word: I’ve seen the video.
It shows abu Dan kneeling, his hands bound behind his back, and screaming as his captors pummel him with a black iron rod. “I lost all the skin on my back from the beatings,” he says. “Instead of medicine, they poured perfume on my wounds. It felt as if they had taken a sword to my injuries.”
On January 26, 2007, abu Dan, a student at the Islamic University of Gaza, had gone to a local cemetery with his father and five others to erect a headstone for his grandmother. When they arrived, however, they found themselves surrounded by 30 armed men from Hamas’s rival, Fatah, the party of Palestinian president Mahmoud Abbas. “They took us to a house in north Gaza,” abu Dan says. “They covered our eyes and took us to a room on the sixth floor.”
The video reveals a bare room with white walls and a black-and-white tiled floor, where abu Dan’s father is forced to sit and listen to his son’s shrieks of pain. Afterward, abu Dan says, he and two of the others were driven to a market square. “They told us they were going to kill us. They made us sit on the ground.” He rolls up the legs of his trousers to display the circular scars that are evidence of what happened next: “They shot our knees and feet—five bullets each. I spent four months in a wheelchair.”
Abu Dan had no way of knowing it, but his tormentors had a secret ally: the administration of President George W. Bush.
A clue comes toward the end of the video, which was found in a Fatah security building by Hamas fighters last June. Still bound and blindfolded, the prisoners are made to echo a rhythmic chant yelled by one of their captors: “By blood, by soul, we sacrifice ourselves for Muhammad Dahlan! Long live Muhammad Dahlan!”
There is no one more hated among Hamas members than Muhammad Dahlan, long Fatah’s resident strongman in Gaza. Dahlan, who most recently served as Abbas’s national-security adviser, has spent more than a decade battling Hamas. Dahlan insists that abu Dan was tortured without his knowledge, but the video is proof that his followers’ methods can be brutal.
Bush has met Dahlan on at least three occasions. After talks at the White House in July 2003, Bush publicly praised Dahlan as “a good, solid leader.” In private, say multiple Israeli and American officials, the U.S. president described him as “our guy.”
The United States has been involved in the affairs of the Palestinian territories since the Six-Day War of 1967, when Israel captured Gaza from Egypt and the West Bank from Jordan. With the 1993 Oslo accords, the territories acquired limited autonomy, under a president, who has executive powers, and an elected parliament. Israel retains a large military presence in the West Bank, but it withdrew from Gaza in 2005.
In recent months, President Bush has repeatedly stated that the last great ambition of his presidency is to broker a deal that would create a viable Palestinian state and bring peace to the Holy Land. “People say, ‘Do you think it’s possible, during your presidency?’?” he told an audience in Jerusalem on January 9. “And the answer is: I’m very hopeful.”
The next day, in the West Bank capital of Ramallah, Bush acknowledged that there was a rather large obstacle standing in the way of this goal: Hamas’s complete control of Gaza, home to some 1.5 million Palestinians, where it seized power in a bloody coup d’état in June 2007. Almost every day, militants fire rockets from Gaza into neighboring Israeli towns, and President Abbas is powerless to stop them. His authority is limited to the West Bank.
It’s “a tough situation,” Bush admitted. “I don’t know whether you can solve it in a year or not.” What Bush neglected to mention was his own role in creating this mess.
According to Dahlan, it was Bush who had pushed legislative elections in the Palestinian territories in January 2006, despite warnings that Fatah was not ready. After Hamas—whose 1988 charter committed it to the goal of driving Israel into the sea—won control of the parliament, Bush made another, deadlier miscalculation.
Vanity Fair has obtained confidential documents, since corroborated by sources in the U.S. and Palestine, which lay bare a covert initiative, approved by Bush and implemented by Secretary of State Condoleezza Rice and Deputy National Security Adviser Elliott Abrams, to provoke a Palestinian civil war. The plan was for forces led by Dahlan, and armed with new weapons supplied at America’s behest, to give Fatah the muscle it needed to remove the democratically elected Hamas-led government from power. (The State Department declined to comment.)
But the secret plan backfired, resulting in a further setback for American foreign policy under Bush. Instead of driving its enemies out of power, the U.S.-backed Fatah fighters inadvertently provoked Hamas to seize total control of Gaza.
Some sources call the scheme “Iran-contra 2.0,” recalling that Abrams was convicted (and later pardoned) for withholding information from Congress during the original Iran-contra scandal under President Reagan. There are echoes of other past misadventures as well: the C.I.A.’s 1953 ouster of an elected prime minister in Iran, which set the stage for the 1979 Islamic revolution there; the aborted 1961 Bay of Pigs invasion, which gave Fidel Castro an excuse to solidify his hold on Cuba; and the contemporary tragedy in Iraq.
Within the Bush administration, the Palestinian policy set off a furious debate. One of its critics is David Wurmser, the avowed neoconservative, who resigned as Vice President Dick Cheney’s chief Middle East adviser in July 2007, a month after the Gaza coup.
Wurmser accuses the Bush administration of “engaging in a dirty war in an effort to provide a corrupt dictatorship [led by Abbas] with victory.” He believes that Hamas had no intention of taking Gaza until Fatah forced its hand. “It looks to me that what happened wasn’t so much a coup by Hamas but an attempted coup by Fatah that was pre-empted before it could happen,” Wurmser says.
The botched plan has rendered the dream of Middle East peace more remote than ever, but what really galls neocons such as Wurmser is the hypocrisy it exposed. “There is a stunning disconnect between the president’s call for Middle East democracy and this policy,” he says. “It directly contradicts it.”
Preventive Security
Bush was not the first American president to form a relationship with Muhammad Dahlan. “Yes, I was close to Bill Clinton,” Dahlan says. “I met Clinton many times with [the late Palestinian leader Yasser] Arafat.” In the wake of the 1993 Oslo accords, Clinton sponsored a series of diplomatic meetings aimed at reaching a permanent Middle East peace, and Dahlan became the Palestinians’ negotiator on security.
As I talk to Dahlan in a five-star Cairo hotel, it’s easy to see the qualities that might make him attractive to American presidents. His appearance is immaculate, his English is serviceable, and his manner is charming and forthright. Had he been born into privilege, these qualities might not mean much. But Dahlan was born—on September 29, 1961—in the teeming squalor of Gaza’s Khan Younis refugee camp, and his education came mostly from the street. In 1981 he helped found Fatah’s youth movement, and he later played a leading role in the first intifada—the five-year revolt that began in 1987 against the Israeli occupation. In all, Dahlan says, he spent five years in Israeli jails.
From the time of its inception as the Palestinian branch of the international Muslim Brotherhood, in late 1987, Hamas had represented a threatening challenge to Arafat’s secular Fatah party. At Oslo, Fatah made a public commitment to the search for peace, but Hamas continued to practice armed resistance. At the same time, it built an impressive base of support through schooling and social programs.
The rising tensions between the two groups first turned violent in the early 1990s—with Muhammad Dahlan playing a central role. As director of the Palestinian Authority’s most feared paramilitary force, the Preventive Security Service, Dahlan arrested some 2,000 Hamas members in 1996 in the Gaza Strip after the group launched a wave of suicide bombings. “Arafat had decided to arrest Hamas military leaders, because they were working against his interests, against the peace process, against the Israeli withdrawal, against everything,” Dahlan says. “He asked the security services to do their job, and I have done that job.”
It was not, he admits, “popular work.” For many years Hamas has said that Dahlan’s forces routinely tortured detainees. One alleged method was to sodomize prisoners with soda bottles. Dahlan says these stories are exaggerated: “Definitely there were some mistakes here and there. But no one person died in Preventive Security. Prisoners got their rights. Bear in mind that I am an ex-detainee of the Israelis’. No one was personally humiliated, and I never killed anyone the way [Hamas is] killing people on a daily basis now.” Dahlan points out that Arafat maintained a labyrinth of security services—14 in all—and says the Preventive Security Service was blamed for abuses perpetrated by other units.
Dahlan worked closely with the F.B.I. and the C.I.A., and he developed a warm relationship with Director of Central Intelligence George Tenet, a Clinton appointee who stayed on under Bush until July 2004. “He’s simply a great and fair man,” Dahlan says. “I’m still in touch with him from time to time.”
“Everyone Was Against the Elections”
In a speech in the White House Rose Garden on June 24, 2002, President Bush announced that American policy in the Middle East was turning in a fundamentally new direction.
Arafat was still in power at the time, and many in the U.S. and Israel blamed him for wrecking Clinton’s micro-managed peace efforts by launching the second intifada—a renewed revolt, begun in 2000, in which more than 1,000 Israelis and 4,500 Palestinians had died. Bush said he wanted to give Palestinians the chance to choose new leaders, ones who were not “compromised by terror.” In place of Arafat’s all-powerful presidency, Bush said, “the Palestinian parliament should have the full authority of a legislative body.”
Arafat died in November 2004, and Abbas, his replacement as Fatah leader, was elected president in January 2005. Elections for the Palestinian parliament, known officially as the Legislative Council, were originally set for July 2005, but later postponed by Abbas until January 2006.
Dahlan says he warned his friends in the Bush administration that Fatah still wasn’t ready for elections in January. Decades of self-preservationist rule by Arafat had turned the party into a symbol of corruption and inefficiency—a perception Hamas found it easy to exploit. Splits within Fatah weakened its position further: in many places, a single Hamas candidate ran against several from Fatah.
“Everyone was against the elections,” Dahlan says. Everyone except Bush. “Bush decided, ‘I need an election. I want elections in the Palestinian Authority.’ Everyone is following him in the American administration, and everyone is nagging Abbas, telling him, ‘The president wants elections.’ Fine. For what purpose?”
The elections went forward as scheduled. On January 25, Hamas won 56 percent of the seats in the Legislative Council.
Few inside the U.S. administration had predicted the result, and there was no contingency plan to deal with it. “I’ve asked why nobody saw it coming,” Condoleezza Rice told reporters. “I don’t know anyone who wasn’t caught off guard by Hamas’s strong showing.”
“Everyone blamed everyone else,” says an official with the Department of Defense. “We sat there in the Pentagon and said, ‘Who the fuck recommended this?’?”
In public, Rice tried to look on the bright side of the Hamas victory. “Unpredictability,” she said, is “the nature of big historic change.” Even as she spoke, however, the Bush administration was rapidly revising its attitude toward Palestinian democracy.
Some analysts argued that Hamas had a substantial moderate wing that could be strengthened if America coaxed it into the peace process. Notable Israelis—such as Ephraim Halevy, the former head of the Mossad intelligence agency—shared this view. But if America paused to consider giving Hamas the benefit of the doubt, the moment was “milliseconds long,” says a senior State Department official. “The administration spoke with one voice: ‘We have to squeeze these guys.’ With Hamas’s election victory, the freedom agenda was dead.”
The first step, taken by the Middle East diplomatic “Quartet”—the U.S., the European Union, Russia, and the United Nations—was to demand that the new Hamas government renounce violence, recognize Israel’s right to exist, and accept the terms of all previous agreements. When Hamas refused, the Quartet shut off the faucet of aid to the Palestinian Authority, depriving it of the means to pay salaries and meet its annual budget of roughly $2 billion.
Israel clamped down on Palestinians’ freedom of movement, especially into and out of the Hamas-dominated Gaza Strip. Israel also detained 64 Hamas officials, including Legislative Council members and ministers, and even launched a military campaign into Gaza after one of its soldiers was kidnapped. Through it all, Hamas and its new government, led by Prime Minister Ismail Haniyeh, proved surprisingly resilient.
Washington reacted with dismay when Abbas began holding talks with Hamas in the hope of establishing a “unity government.” On October 4, 2006, Rice traveled to Ramallah to see Abbas. They met at the Muqata, the new presidential headquarters that rose from the ruins of Arafat’s compound, which Israel had destroyed in 2002.
America’s leverage in Palestinian affairs was much stronger than it had been in Arafat’s time. Abbas had never had a strong, independent base, and he desperately needed to restore the flow of foreign aid—and, with it, his power of patronage. He also knew that he could not stand up to Hamas without Washington’s help.
At their joint press conference, Rice smiled as she expressed her nation’s “great admiration” for Abbas’s leadership. Behind closed doors, however, Rice’s tone was sharper, say officials who witnessed their meeting. Isolating Hamas just wasn’t working, she reportedly told Abbas, and America expected him to dissolve the Haniyeh government as soon as possible and hold fresh elections.
Abbas, one official says, agreed to take action within two weeks. It happened to be Ramadan, the month when Muslims fast during daylight hours. With dusk approaching, Abbas asked Rice to join him for iftar—a snack to break the fast.
Afterward, according to the official, Rice underlined her position: “So we’re agreed? You’ll dissolve the government within two weeks?”
“Maybe not two weeks. Give me a month. Let’s wait until after the Eid,” he said, referring to the three-day celebration that marks the end of Ramadan. (Abbas’s spokesman said via e-mail: “According to our records, this is incorrect.”)
Rice got into her armored S.U.V., where, the official claims, she told an American colleague, “That damned iftar has cost us another two weeks of Hamas government.”
“We Will Be There to Support You”
Weeks passed with no sign that Abbas was ready to do America’s bidding. Finally, another official was sent to Ramallah. Jake Walles, the consul general in Jerusalem, is a career foreign-service officer with many years’ experience in the Middle East. His purpose was to deliver a barely varnished ultimatum to the Palestinian president.
We know what Walles said because a copy was left behind, apparently by accident, of the “talking points” memo prepared for him by the State Department. The document has been authenticated by U.S. and Palestinian officials.
“We need to understand your plans regarding a new [Palestinian Authority] government,” Walles’s script said. “You told Secretary Rice you would be prepared to move ahead within two to four weeks of your meeting. We believe that the time has come for you to move forward quickly and decisively.”
The “talking points” memo, left behind by a State Department envoy, urging Palestinian president Mahmoud Abbas to confront Hamas. The memo left no doubt as to what kind of action the U.S. was seeking: “Hamas should be given a clear choice, with a clear deadline: … they either accept a new government that meets the Quartet principles, or they reject it The consequences of Hamas’ decision should also be clear: If Hamas does not agree within the prescribed time, you should make clear your intention to declare a state of emergency and form an emergency government explicitly committed to that platform."
Walles and Abbas both knew what to expect from Hamas if these instructions were followed: rebellion and bloodshed. For that reason, the memo states, the U.S. was already working to strengthen Fatah’s security forces. “If you act along these lines, we will support you both materially and politically,” the script said. “We will be there to support you.”
Abbas was also encouraged to “strengthen [his] team” to include “credible figures of strong standing in the international community.” Among those the U.S. wanted brought in, says an official who knew of the policy, was Muhammad Dahlan.
On paper, the forces at Fatah’s disposal looked stronger than those of Hamas. There were some 70,000 men in the tangle of 14 Palestinian security services that Arafat had built up, at least half of those in Gaza. After the legislative elections, Hamas had expected to assume command of these forces, but Fatah maneuvered to keep them under its control. Hamas, which already had 6,000 or so irregulars in its militant al-Qassam Brigade, responded by forming the 6,000-troop Executive Force in Gaza, but that still left it with far fewer fighters than Fatah.
In reality, however, Hamas had several advantages. To begin with, Fatah’s security forces had never really recovered from Operation Defensive Shield, Israel’s massive 2002 re-invasion of the West Bank in response to the second intifada. “Most of the security apparatus had been destroyed,” says Youssef Issa, who led the Preventive Security Service under Abbas.
The irony of the blockade on foreign aid after Hamas’s legislative victory, meanwhile, was that it prevented only Fatah from paying its soldiers. “We are the ones who were not getting paid,” Issa says, “whereas they were not affected by the siege.” Ayman Daraghmeh, a Hamas Legislative Council member in the West Bank, agrees. He puts the amount of Iranian aid to Hamas in 2007 alone at $120 million. “This is only a fraction of what it should give,” he insists. In Gaza, another Hamas member tells me the number was closer to $200 million.
The result was becoming apparent: Fatah could not control Gaza’s streets—or even protect its own personnel.
At about 1:30 p.m. on September 15, 2006, Samira Tayeh sent a text message to her husband, Jad Tayeh, the director of foreign relations for the Palestinian intelligence service and a member of Fatah. “He didn’t reply,” she says. “I tried to call his mobile [phone], but it was switched off. So I called his deputy, Mahmoun, and he didn’t know where he was. That’s when I decided to go to the hospital.”
Samira, a slim, elegant 40-year-old dressed from head to toe in black, tells me the story in a Ramallah café in December 2007. Arriving at the Al Shifa hospital, “I went through the morgue door. Not for any reason—I just didn’t know the place. I saw there were all these intelligence guards there. There was one I knew. He saw me and he said, ‘Put her in the car.’ That’s when I knew something had happened to Jad.”
Tayeh had left his office in a car with four aides. Moments later, they found themselves being pursued by an S.U.V. full of armed, masked men. About 200 yards from the home of Prime Minister Haniyeh, the S.U.V. cornered the car. The masked men opened fire, killing Tayeh and all four of his colleagues.
Hamas said it had nothing to do with the murders, but Samira had reason to believe otherwise. At three a.m. on June 16, 2007, during the Gaza takeover, six Hamas gunmen forced their way into her home and fired bullets into every photo of Jad they could find. The next day, they returned and demanded the keys to the car in which he had died, claiming that it belonged to the Palestinian Authority.
Fearing for her life, she fled across the border and then into the West Bank, with only the clothes she was wearing and her passport, driver’s license, and credit card.
To be continued ... (See "The Gaza Bombshell Part 2")
[Baca]
Continued from "The Gaza Bombshell Part 1"
“Very Clever Warfare”
Fatah’s vulnerability was a source of grave concern to Dahlan. “I made a lot of activities to give Hamas the impression that we were still strong and we had the capacity to face them,” he says. “But I knew in my heart it wasn’t true.” He had no official security position at the time, but he belonged to parliament and retained the loyalty of Fatah members in Gaza. “I used my image, my power.” Dahlan says he told Abbas that “Gaza needs only a decision for Hamas to take over.” To prevent that from happening, Dahlan waged “very clever warfare” for many months.
According to several alleged victims, one of the tactics this “warfare” entailed was to kidnap and torture members of Hamas’s Executive Force. (Dahlan denies Fatah used such tactics, but admits “mistakes” were made.) Abdul Karim al-Jasser, a strapping man of 25, says he was the first such victim. “It was on October 16, still Ramadan,” he says. “I was on my way to my sister’s house for iftar. Four guys stopped me, two of them with guns. They forced me to accompany them to the home of Aman abu Jidyan,” a Fatah leader close to Dahlan. (Abu Jidyan would be killed in the June uprising.)
The first phase of torture was straightforward enough, al-Jasser says: he was stripped naked, bound, blindfolded, and beaten with wooden poles and plastic pipes. “They put a piece of cloth in my mouth to stop me screaming.” His interrogators forced him to answer contradictory accusations: one minute they said that he had collaborated with Israel, the next that he had fired Qassam rockets against it.
But the worst was yet to come. “They brought an iron bar,” al-Jasser says, his voice suddenly hesitant. We are speaking inside his home in Gaza, which is experiencing one of its frequent power outages. He points to the propane-gas lamp that lights the room. “They put the bar in the flame of a lamp like this. When it was red, they took the covering off my eyes. Then they pressed it against my skin. That was the last thing I remember.”
When he came to, he was still in the room where he had been tortured. A few hours later, the Fatah men handed him over to Hamas, and he was taken to the hospital. “I could see the shock in the eyes of the doctors who entered the room,” he says. He shows me photos of purple third-degree burns wrapped like towels around his thighs and much of his lower torso. “The doctors told me that if I had been thin, not chubby, I would have died. But I wasn’t alone. That same night that I was released, abu Jidyan’s men fired five bullets into the legs of one of my relatives. We were in the same ward in the hospital.”
Dahlan says he did not order al-Jasser’s torture: “The only order I gave was to defend ourselves. That doesn’t mean there wasn’t torture, some things that went wrong, but I did not know about this.”
The dirty war between Fatah and Hamas continued to gather momentum throughout the autumn, with both sides committing atrocities. By the end of 2006, dozens were dying each month. Some of the victims were noncombatants. In December, gunmen opened fire on the car of a Fatah intelligence official, killing his three young children and their driver.
There was still no sign that Abbas was ready to bring matters to a head by dissolving the Hamas government. Against this darkening background, the U.S. began direct security talks with Dahlan.
“He’s Our Guy”
In 2001, President Bush famously said that he had looked Russian president Vladimir Putin in the eye, gotten “a sense of his soul,” and found him to be “trustworthy.” According to three U.S. officials, Bush made a similar judgment about Dahlan when they first met, in 2003. All three officials recall hearing Bush say, “He’s our guy.”
They say this assessment was echoed by other key figures in the administration, including Rice and Assistant Secretary David Welch, the man in charge of Middle East policy at the State Department. “David Welch didn’t fundamentally care about Fatah,” one of his colleagues says. “He cared about results, and [he supported] whatever son of a bitch you had to support. Dahlan was the son of a bitch we happened to know best. He was a can-do kind of person. Dahlan was our guy.”
Avi Dichter, Israel’s internal-security minister and the former head of its Shin Bet security service, was taken aback when he heard senior American officials refer to Dahlan as “our guy.” “I thought to myself, The president of the United States is making a strange judgment here,” says Dichter.
Lieutenant General Keith Dayton, who had been appointed the U.S. security coordinator for the Palestinians in November 2005, was in no position to question the president’s judgment of Dahlan. His only prior experience with the Middle East was as director of the Iraq Survey Group, the body that looked for Saddam Hussein’s elusive weapons of mass destruction.
In November 2006, Dayton met Dahlan for the first of a long series of talks in Jerusalem and Ramallah. Both men were accompanied by aides. From the outset, says an official who took notes at the meeting, Dayton was pushing two overlapping agendas.
“We need to reform the Palestinian security apparatus,” Dayton said, according to the notes. “But we also need to build up your forces in order to take on Hamas.”
Dahlan replied that, in the long run, Hamas could be defeated only by political means. “But if I am going to confront them,” he added, “I need substantial resources. As things stand, we do not have the capability.”
The two men agreed that they would work toward a new Palestinian security plan. The idea was to simplify the confusing web of Palestinian security forces and have Dahlan assume responsibility for all of them in the newly created role of Palestinian national-security adviser. The Americans would help supply weapons and training.
As part of the reform program, according to the official who was present at the meetings, Dayton said he wanted to disband the Preventive Security Service, which was widely known to be engaged in kidnapping and torture. At a meeting in Dayton’s Jerusalem office in early December, Dahlan ridiculed the idea. “The only institution now protecting Fatah and the Palestinian Authority in Gaza is the one you want removed,” he said.
Dayton softened a little. “We want to help you,” he said. “What do you need?”
“Iran-Contra 2.0”
Under Bill Clinton, Dahlan says, commitments of security assistance “were always delivered, absolutely.” Under Bush, he was about to discover, things were different. At the end of 2006, Dayton promised an immediate package worth $86.4 million—money that, according to a U.S. document published by Reuters on January 5, 2007, would be used to “dismantle the infrastructure of terrorism and establish law and order in the West Bank and Gaza.” U.S. officials even told reporters the money would be transferred “in the coming days.”
The cash never arrived. “Nothing was disbursed,” Dahlan says. “It was approved and it was in the news. But we received not a single penny.”
Any notion that the money could be transferred quickly and easily had died on Capitol Hill, where the payment was blocked by the House Subcommittee on the Middle East and South Asia. Its members feared that military aid to the Palestinians might end up being turned against Israel.
Dahlan did not hesitate to voice his exasperation. “I spoke to Condoleezza Rice on several occasions,” he says. “I spoke to Dayton, to the consul general, to everyone in the administration I knew. They said, ‘You have a convincing argument.’ We were sitting in Abbas’s office in Ramallah, and I explained the whole thing to Condi. And she said, ‘Yes, we have to make an effort to do this. There’s no other way.’?” At some of these meetings, Dahlan says, Assistant Secretary Welch and Deputy National-Security Adviser Abrams were also present.
The administration went back to Congress, and a reduced, $59 million package for nonlethal aid was approved in April 2007. But as Dahlan knew, the Bush team had already spent the past months exploring alternative, covert means of getting him the funds and weapons he wanted. The reluctance of Congress meant that “you had to look for different pots, different sources of money,” says a Pentagon official.
A State Department official adds, “Those in charge of implementing the policy were saying, ‘Do whatever it takes. We have to be in a position for Fatah to defeat Hamas militarily, and only Muhammad Dahlan has the guile and the muscle to do this.’ The expectation was that this was where it would end up—with a military showdown.” There were, this official says, two “parallel programs”—the overt one, which the administration took to Congress, “and a covert one, not only to buy arms but to pay the salaries of security personnel.”
In essence, the program was simple. According to State Department officials, beginning in the latter part of 2006, Rice initiated several rounds of phone calls and personal meetings with leaders of four Arab nations—Egypt, Jordan, Saudi Arabia, and the United Arab Emirates. She asked them to bolster Fatah by providing military training and by pledging funds to buy its forces lethal weapons. The money was to be paid directly into accounts controlled by President Abbas.
The scheme bore some resemblance to the Iran-contra scandal, in which members of Ronald Reagan’s administration sold arms to Iran, an enemy of the U.S. The money was used to fund the contra rebels in Nicaragua, in violation of a congressional ban. Some of the money for the contras, like that for Fatah, was furnished by Arab allies as a result of U.S. lobbying.
But there are also important differences—starting with the fact that Congress never passed a measure expressly prohibiting the supply of aid to Fatah and Dahlan. “It was close to the margins,” says a former intelligence official with experience in covert programs. “But it probably wasn’t illegal.”
Legal or not, arms shipments soon began to take place. In late December 2006, four Egyptian trucks passed through an Israeli-controlled crossing into Gaza, where their contents were handed over to Fatah. These included 2,000 Egyptian-made automatic rifles, 20,000 ammunition clips, and two million bullets. News of the shipment leaked, and Benjamin Ben-Eliezer, an Israeli Cabinet member, said on Israeli radio that the guns and ammunition would give Abbas “the ability to cope with those organizations which are trying to ruin everything”—namely, Hamas.
Avi Dichter points out that all weapons shipments had to be approved by Israel, which was understandably hesitant to allow state-of-the-art arms into Gaza. “One thing’s for sure, we weren’t talking about heavy weapons,” says a State Department official. “It was small arms, light machine guns, ammunition.”
Perhaps the Israelis held the Americans back. Perhaps Elliott Abrams himself held back, unwilling to run afoul of U.S. law for a second time. One of his associates says Abrams, who declined to comment for this article, felt conflicted over the policy—torn between the disdain he felt for Dahlan and his overriding loyalty to the administration. He wasn’t the only one: “There were severe fissures among neoconservatives over this,” says Cheney’s former adviser David Wurmser. “We were ripping each other to pieces.”
During a trip to the Middle East in January 2007, Rice found it difficult to get her partners to honor their pledges. “The Arabs felt the U.S. was not serious,” one official says. “They knew that if the Americans were serious they would put their own money where their mouth was. They didn’t have faith in America’s ability to raise a real force. There was no follow-through. Paying was different than pledging, and there was no plan.”
This official estimates that the program raised “a few payments of $30 million”—most of it, as other sources agree, from the United Arab Emirates. Dahlan himself says the total was only $20 million, and confirms that “the Arabs made many more pledges than they ever paid.” Whatever the exact amount, it was not enough.
Plan B
On February 1, 2007, Dahlan took his “very clever warfare” to a new level when Fatah forces under his control stormed the Islamic University of Gaza, a Hamas stronghold, and set several buildings on fire. Hamas retaliated the next day with a wave of attacks on police stations.
Unwilling to preside over a Palestinian civil war, Abbas blinked. For weeks, King Abdullah of Saudi Arabia had been trying to persuade him to meet with Hamas in Mecca and formally establish a national unity government. On February 6, Abbas went, taking Dahlan with him. Two days later, with Hamas no closer to recognizing Israel, a deal was struck.
Under its terms, Ismail Haniyeh of Hamas would remain prime minister while allowing Fatah members to occupy several important posts. When the news hit the streets that the Saudis had promised to pay the Palestinian Authority’s salary bills, Fatah and Hamas members in Gaza celebrated together by firing their Kalashnikovs into the air.
Once again, the Bush administration had been taken by surprise. According to a State Department official, “Condi was apoplectic.” A remarkable documentary record, revealed here for the first time, shows that the U.S. responded by redoubling the pressure on its Palestinian allies.
The State Department quickly drew up an alternative to the new unity government. Known as “Plan B,” its objective, according to a State Department memo that has been authenticated by an official who knew of it at the time, was to “enable [Abbas] and his supporters to reach a defined endgame by the end of 2007 The endgame should produce a [Palestinian Authority] government through democratic means that accepts Quartet principles.”
Like the Walles ultimatum of late 2006, Plan B called for Abbas to “collapse the government” if Hamas refused to alter its attitude toward Israel. From there, Abbas could call early elections or impose an emergency government. It is unclear whether, as president, Abbas had the constitutional authority to dissolve an elected government led by a rival party, but the Americans swept that concern aside.
Security considerations were paramount, and Plan B had explicit prescriptions for dealing with them. For as long as the unity government remained in office, it was essential for Abbas to maintain “independent control of key security forces.” He must “avoid Hamas integration with these services, while eliminating the Executive Force or mitigating the challenges posed by its continued existence.”
In a clear reference to the covert aid expected from the Arabs, the memo made this recommendation for the next six to nine months: “Dahlan oversees effort in coordination with General Dayton and Arab [nations] to train and equip 15,000-man force under President Abbas’s control to establish internal law and order, stop terrorism and deter extralegal forces.”
The Bush administration’s goals for Plan B were elaborated in a document titled “An Action Plan for the Palestinian Presidency.” This action plan went through several drafts and was developed by the U.S., the Palestinians, and the government of Jordan. Sources agree, however, that it originated in the State Department.
The early drafts stressed the need for bolstering Fatah’s forces in order to “deter” Hamas. The “desired outcome” was to give Abbas “the capability to take the required strategic political decisions … such as dismissing the cabinet, establishing an emergency cabinet.”
The drafts called for increasing the “level and capacity” of 15,000 of Fatah’s existing security personnel while adding 4,700 troops in seven new “highly trained battalions on strong policing.” The plan also promised to arrange “specialized training abroad,” in Jordan and Egypt, and pledged to “provide the security personnel with the necessary equipment and arms to carry out their missions.”
A detailed budget put the total cost for salaries, training, and “the needed security equipment, lethal and non-lethal,” at $1.27 billion over five years. The plan states: “The costs and overall budget were developed jointly with General Dayton’s team and the Palestinian technical team for reform”—a unit established by Dahlan and led by his friend and policy aide Bassil Jaber. Jaber confirms that the document is an accurate summary of the work he and his colleagues did with Dayton. “The plan was to create a security establishment that could protect and strengthen a peaceful Palestinian state living side by side with Israel,” he says.
The final draft of the Action Plan was drawn up in Ramallah by officials of the Palestinian Authority. This version was identical to the earlier drafts in all meaningful ways but one: it presented the plan as if it had been the Palestinians’ idea. It also said the security proposals had been “approved by President Mahmoud Abbas after being discussed and agreed [to] by General Dayton’s team.”
On April 30, 2007, a portion of one early draft was leaked to a Jordanian newspaper, Al-Majd. The secret was out. From Hamas’s perspective, the Action Plan could amount to only one thing: a blueprint for a U.S.-backed Fatah coup.
“We Are Late in the Ball Game Here”
The formation of the unity government had brought a measure of calm to the Palestinian territories, but violence erupted anew after Al-Majd published its story on the Action Plan. The timing was unkind to Fatah, which, to add to its usual disadvantages, was without its security chief. Ten days earlier, Dahlan had left Gaza for Berlin, where he’d had surgery on both knees. He was due to spend the next eight weeks convalescing.
In mid-May, with Dahlan still absent, a new element was added to Gaza’s toxic mix when 500 Fatah National Security Forces recruits arrived, fresh from training in Egypt and equipped with new weapons and vehicles. “They had been on a crash course for 45 days,” Dahlan says. “The idea was that we needed them to go in dressed well, equipped well, and that might create the impression of new authority.” Their presence was immediately noticed, not only by Hamas but by staff from Western aid agencies. “They had new rifles with telescopic sights, and they were wearing black flak jackets,” says a frequent visitor from Northern Europe. “They were quite a contrast to the usual scruffy lot.”
On May 23, none other than Lieutenant General Dayton discussed the new unit in testimony before the House Middle East subcommittee. Hamas had attacked the troops as they crossed into Gaza from Egypt, Dayton said, but “these 500 young people, fresh out of basic training, were organized. They knew how to work in a coordinated fashion. Training does pay off. And the Hamas attack in the area was, likewise, repulsed.”
The troops’ arrival, Dayton said, was one of several “hopeful signs” in Gaza. Another was Dahlan’s appointment as national-security adviser. Meanwhile, he said, Hamas’s Executive Force was becoming “extremely unpopular I would say that we are kind of late in the ball game here, and we are behind, there’s two out, but we have our best clutch hitter at the plate, and the pitcher is beginning to tire on the opposing team.”
The opposing team was stronger than Dayton realized. By the end of May 2007, Hamas was mounting regular attacks of unprecedented boldness and savagery.
At an apartment in Ramallah that Abbas has set aside for wounded refugees from Gaza, I meet a former Fatah communications officer named Tariq Rafiyeh. He lies paralyzed from a bullet he took to the spine during the June coup, but his suffering began two weeks earlier. On May 31, he was on his way home with a colleague when they were stopped at a roadblock, robbed of their money and cell phones, and taken to a mosque. There, despite the building’s holy status, Hamas Executive Force members were violently interrogating Fatah detainees. “Late that night one of them said we were going to be released,” Rafiyeh recalls. “He told the guards, ‘Be hospitable, keep them warm.’ I thought that meant kill us. Instead, before letting us go they beat us badly.”
On June 7, there was another damaging leak, when the Israeli newspaper Haaretz reported that Abbas and Dayton had asked Israel to authorize the biggest Egyptian arms shipment yet—to include dozens of armored cars, hundreds of armor-piercing rockets, thousands of hand grenades, and millions of rounds of ammunition. A few days later, just before the next batch of Fatah recruits was due to leave for training in Egypt, the coup began in earnest.
Fatah’s Last Stand
The Hamas leadership in Gaza is adamant that the coup would not have happened if Fatah had not provoked it. Fawzi Barhoum, Hamas’s chief spokesman, says the leak in Al-Majd convinced the party that “there was a plan, approved by America, to destroy the political choice.” The arrival of the first Egyptian-trained fighters, he adds, was the “reason for the timing.” About 250 Hamas members had been killed in the first six months of 2007, Barhoum tells me. “Finally we decided to put an end to it. If we had let them stay loose in Gaza, there would have been more violence.”
“Everyone here recognizes that Dahlan was trying with American help to undermine the results of the elections,” says Mahmoud Zahar, the former foreign minister for the Haniyeh government, who now leads Hamas’s militant wing in Gaza. “He was the one planning a coup.”
Zahar and I speak inside his home in Gaza, which was rebuilt after a 2003 Israeli air strike destroyed it, killing one of his sons. He tells me that Hamas launched its operations in June with a limited objective: “The decision was only to get rid of the Preventive Security Service. They were the ones out on every crossroads, putting anyone suspected of Hamas involvement at risk of being tortured or killed.” But when Fatah fighters inside a surrounded Preventive Security office in Jabaliya began retreating from building to building, they set off a “domino effect” that emboldened Hamas to seek broader gains.
Many armed units that were nominally loyal to Fatah did not fight at all. Some stayed neutral because they feared that, with Dahlan absent, his forces were bound to lose. “I wanted to stop the cycle of killing,” says Ibrahim abu al-Nazar, a veteran party chief. “What did Dahlan expect? Did he think the U.S. Navy was going to come to Fatah’s rescue? They promised him everything, but what did they do? But he also deceived them. He told them he was the strongman of the region. Even the Americans may now feel sad and frustrated. Their friend lost the battle.”
Others who stayed out of the fight were extremists. “Fatah is a large movement, with many schools inside it,” says Khalid Jaberi, a commander with Fatah’s al-Aqsa Martyrs’ Brigades, which continue to fire rockets into Israel from Gaza. “Dahlan’s school is funded by the Americans and believes in negotiations with Israel as a strategic choice. Dahlan tried to control everything in Fatah, but there are cadres who could do a much better job. Dahlan treated us dictatorially. There was no overall Fatah decision to confront Hamas, and that’s why our guns in al-Aqsa are the cleanest. They are not corrupted by the blood of our people.”
Jaberi pauses. He spent the night before our interview awake and in hiding, fearful of Israeli air strikes. “You know,” he says, “since the takeover, we’ve been trying to enter the brains of Bush and Rice, to figure out their mentality. We can only conclude that having Hamas in control serves their overall strategy, because their policy was so crazy otherwise.”
The fighting was over in less than five days. It began with attacks on Fatah security buildings, in and around Gaza City and in the southern town of Rafah. Fatah attempted to shell Prime Minister Haniyeh’s house, but by dusk on June 13 its forces were being routed.
Years of oppression by Dahlan and his forces were avenged as Hamas chased down stray Fatah fighters and subjected them to summary execution. At least one victim was reportedly thrown from the roof of a high-rise building. By June 16, Hamas had captured every Fatah building, as well as Abbas’s official Gaza residence. Much of Dahlan’s house, which doubled as his office, was reduced to rubble.
Fatah’s last stand, predictably enough, was made by the Preventive Security Service. The unit sustained heavy casualties, but a rump of about 100 surviving fighters eventually made it to the beach and escaped in the night by fishing boat.
At the apartment in Ramallah, the wounded struggle on. Unlike Fatah, Hamas fired exploding bullets, which are banned under the Geneva Conventions. Some of the men in the apartment were shot with these rounds 20 or 30 times, producing unimaginable injuries that required amputation. Several have lost both legs.
The coup has had other costs. Amjad Shawer, a local economist, tells me that Gaza had 400 functioning factories and workshops at the start of 2007. By December, the intensified Israeli blockade had caused 90 percent of them to close. Seventy percent of Gaza’s population is now living on less than $2 a day.
Israel, meanwhile, is no safer. The emergency pro-peace government called for in the secret Action Plan is now in office—but only in the West Bank. In Gaza, the exact thing both Israel and the U.S. Congress warned against came to pass when Hamas captured most of Fatah’s arms and ammunition—including the new Egyptian guns supplied under the covert U.S.-Arab aid program.
Now that it controls Gaza, Hamas has given free rein to militants intent on firing rockets into neighboring Israeli towns. “We are still developing our rockets; soon we shall hit the heart of Ashkelon at will,” says Jaberi, the al-Aqsa commander, referring to the Israeli city of 110,000 people 12 miles from Gaza’s border. “I assure you, the time is near when we will mount a big operation inside Israel, in Haifa or Tel Aviv.”
On January 23, Hamas blew up parts of the wall dividing Gaza from Egypt, and tens of thousands of Palestinians crossed the border. Militants had already been smuggling weapons through a network of underground tunnels, but the breach of the wall made their job much easier—and may have brought Jaberi’s threat closer to reality.
George W. Bush and Condoleezza Rice continue to push the peace process, but Avi Dichter says Israel will never conclude a deal on Palestinian statehood until the Palestinians reform their entire law-enforcement system—what he calls “the chain of security.” With Hamas in control of Gaza, there appears to be no chance of that happening. “Just look at the situation,” says Dahlan. “They say there will be a final-status agreement in eight months? No way.”
“An Institutional Failure”
How could the U.S. have played Gaza so wrong? Neocon critics of the administration—who until last year were inside it—blame an old State Department vice: the rush to anoint a strongman instead of solving problems directly. This ploy has failed in places as diverse as Vietnam, the Philippines, Central America, and Saddam Hussein’s Iraq, during its war against Iran. To rely on proxies such as Muhammad Dahlan, says former U.N. ambassador John Bolton, is “an institutional failure, a failure of strategy.” Its author, he says, was Rice, “who, like others in the dying days of this administration, is looking for legacy. Having failed to heed the warning not to hold the elections, they tried to avoid the result through Dayton.”
With few good options left, the administration now appears to be rethinking its blanket refusal to engage with Hamas. Staffers at the National Security Council and the Pentagon recently put out discreet feelers to academic experts, asking them for papers describing Hamas and its principal protagonists. “They say they won’t talk to Hamas,” says one such expert, “but in the end they’re going to have to. It’s inevitable.”
It is impossible to say for sure whether the outcome in Gaza would have been any better—for the Palestinian people, for the Israelis, and for America’s allies in Fatah—if the Bush administration had pursued a different policy. One thing, however, seems certain: it could not be any worse.
David Rose is a Vanity Fair contributing editor.
[Baca]
Thursday, 22 January 2009
It
would have helped if Obama had the courage to talk about what everyone
in the Middle East was talking about. No, it wasn't the US withdrawal
from Iraq. They knew about that. They expected the beginning of the end
of Guantanamo and the probable appointment of George Mitchell as a
Middle East envoy was the least that was expected. Of course, Obama did
refer to "slaughtered innocents", but these were not quite the
"slaughtered innocents" the Arabs had in mind.
There
was the phone call yesterday to Mahmoud Abbas. Maybe Obama thinks he's
the leader of the Palestinians, but as every Arab knows, except perhaps
Mr Abbas, he is the leader of a ghost government, a near-corpse only
kept alive with the blood transfusion of international support and the
"full partnership" Obama has apparently offered him, whatever "full"
means. And it was no surprise to anyone that Obama also made the
obligatory call to the Israelis.
But for the people of the
Middle East, the absence of the word "Gaza" – indeed, the word "Israel"
as well – was the dark shadow over Obama's inaugural address. Didn't he
care? Was he frightened? Did Obama's young speech-writer not realise
that talking about black rights – why a black man's father might not
have been served in a restaurant 60 years ago – would concentrate Arab
minds on the fate of a people who gained the vote only three years ago
but were then punished because they voted for the wrong people? It
wasn't a question of the elephant in the china shop. It was the sheer
amount of corpses heaped up on the floor of the china shop.
Sure,
it's easy to be cynical. Arab rhetoric has something in common with
Obama's clichés: "hard work and honesty, courage and fair play ...
loyalty and patriotism". But however much distance the new President
put between himself and the vicious regime he was replacing, 9/11 still
hung like a cloud over New York. We had to remember "the firefighter's
courage to storm a stairway filled with smoke". Indeed, for Arabs, the
"our nation is at war against a far-reaching network of violence and
hatred" was pure Bush; the one reference to "terror", the old Bush and
Israeli fear word, was a worrying sign that the new White House still
hasn't got the message. Hence we had Obama, apparently talking about
Islamist groups such as the Taliban who were "slaughtering innocents"
but who "cannot outlast us". As for those in the speech who are corrupt
and who "silence dissent", presumably intended to be the Iranian
government, most Arabs would associate this habit with President Hosni
Mubarak of Egypt (who also, of course, received a phone call from Obama
yesterday), King Abdullah of Saudi Arabia and a host of other autocrats
and head-choppers who are supposed to be America's friends in the
Middle East.
Hanan Ashrawi got it right. The changes in the
Middle East – justice for the Palestinians, security for the
Palestinians as well as for the Israelis, an end to the illegal
building of settlements for Jews and Jews only on Arab land, an end to
all violence, not just the Arab variety – had to be "immediate" she
said, at once. But if the gentle George Mitchell's appointment was
meant to answer this demand, the inaugural speech, a real "B-minus" in
the Middle East, did not.
The friendly message to Muslims, "a new
way forward, based on mutual interest and mutual respect", simply did
not address the pictures of the Gaza bloodbath at which the world has
been staring in outrage. Yes, the Arabs and many other Muslim nations,
and, of course, most of the world, can rejoice that the awful Bush has
gone. So, too, Guantanamo. But will Bush's torturers and Rumsfeld's
torturers be punished? Or quietly promoted to a job where they don't
have to use water and cloths, and listen to men screaming?
Sure,
give the man a chance. Maybe George Mitchell will talk to Hamas – he's
just the man to try – but what will the old failures such as Denis Ross
have to say, and Rahm Emanuel and, indeed, Robert Gates and Hillary
Clinton? More a sermon than an Obama inaugural, even the Palestinians
in Damascus spotted the absence of those two words: Palestine and
Israel. So hot to touch they were, and on a freezing Washington day,
Obama wasn't even wearing gloves.
[Baca]
A letter tells me that I am encouraging fundamentalist attacks on the West
Saturday, 24 January 2009
Mail
that you don't see in the Letters to the Editor column. First, here's
reader Jack Hyde tipping me off about a possible (real) reason behind
Israel's bloodletting in Gaza. He encloses a paper by University of
Ottawa economist Michel Chossudovsky who says that "the military
intervention of the Gaza Strip by Israeli Forces bears a direct
relation to the control and ownership of strategic offshore gas
reserves". It's not exactly The Plot. But it's something that Obama and
his lads and lasses may need to study in the next few days.
For
according to Chossudovsky, British Gas and its partner, the
Athens-based Consolidated Contractors International Company – owned,
apparently, by two Lebanese families – were granted 25-year oil and
exploration rights off the Gaza coast by Yasser Arafat's Palestinian
Authority in 1999. About 60 per cent of reserves along the Gaza-Israel
coastline belong to "Palestine" (wherever that is these days).
But
since the Hamas election victory in 2006 and its coup in Gaza in 2007,
the Hamas government has been by-passed, even though poor old
"President" Mahmoud Abbas, marooned in the West Bank, can only glimpse
the Mediterranean from a hill near Jenin. Many negotiations later – and
after Israeli "defence" officials claimed that the Palestinians could
be paid only in goods and chattels for their gas rather than cash which
might go to the dreaded Hamas – there was a proposed agreement under
which Palestinian gas from Gaza wells would be channelled via undersea
pipelines to the Israeli port of Ashkelon, thus transferring the
control of gas sales to Israel. British Gas withdrew from these talks
in December 2007.
But in June of 2008 – when, according to the
Israeli daily Haaretz, Israel began its invasion plans for Gaza –
Israel suddenly asked British Gas to resume talks. And, so says
Chossudovsky, negotiations began again for the purchase of natural gas
from the Gaza offshore fields. Israeli tanks have now driven out of the
Gaza Strip, but Israeli naval vessels still control the coast and
there's an obvious question: if the Israelis can continue to violate
international law by seizing Palestinian land in the West Bank, why
cannot they seize the sovereignty of Palestinian gas fields off Gaza?
If Israel can annex Jerusalem, why not annex Gaza's maritime areas?
Less
wholesome material is now turning up in my mail bag. Lebanese friends
have shown me copies of a new Palestinian blog in which photographs of
Palestinian women waiting at Israel's abominable checkpoints and
Israeli soldiers firing at Palestinians are "matched" with archive
pictures of the Jewish Holocaust. But the women and children waiting in
the older photos are queuing at the infamous Auschwitz death ramp and
the black-and-white image of a Nazi soldier firing his rifle has been
artfully cropped to delete two figures on the right of the original
picture: a cowering Jewish woman holding her child, who are being shot
in the back. Yes, I believe the Israelis have committed war crimes in
Gaza. And in Lebanon. But this Palestinian comparison is utterly
self-defeating because it is based on a lie.
What am I to make,
for instance, of another pamphlet that has flopped out of my mail
package from the "refugees of Ein Karem, Jerusalem"? These
Palestinians, originally expelled from 1948 Palestine in Israel's
initial act of ethnic cleansing, state that "in view of the current
events in Gaza and Palestine", Israel should be "dismantled" because
"the savage acts by its forces (are) far beyond war crimes committed in
World War Two". Ye Gods! Sixty million humans were slaughtered in the
Second World War and the number of murdered Jews equals the entire
present-day Palestinian population, including refugees.
But do
not think that this is the only nonsense floating around. A letter with
no printed author's name and no address arrives to tell me that I am
encouraging "extreme fundamentalists to carry out attacks on Western
Countries" by exercising "the old chestnut" of "proportionality".
Disregarding the fact that Muslims are enraged by Israel's savagery in
Gaza – not by our reporting of it – the reader asks me: "Were not far
more German civilians killed in the last war than British civilians?
Should all the British Generals be held up as war criminals? Don't talk
nonsense!"
Of course, it's the same old canard. Now, it appears,
it's OK to kill 100 Palestinians in Gaza for every Israeli in the area
because "we" killed more German civilians than the Germans killed Brits
in the Second World War. Note, here, how Germans subtly become the
slaughtered Palestinians, the Israelis (and their ruthless generals)
transmogrified into, I suppose, Air Marshal Harris.
There's an
even more amazing letter that arrived on my Beirut desk this week – it
came from an address in Wimbledon – which deserves to be quoted in full:
"Dear
Mr Fisk, I recently saw an interview that you gave on French News TV. I
was amazed at the size of your massive long nose that (sic) you have.
Is it true that the Hamas Neo-Nazi thugs want to use it next time they
need to hide from the Israelis? Yours faithfully..."
Again, the
Palestinians become Nazi Germans. Do I reply to this racist dirt? Yes,
I rather think I do, with the usual threat of legal action. But I
absolutely promise – a repeated pledge by your reporter – I will not
mention the Second World War!
[Baca]
January 20,2009 ohmynews.com
Outrage and Impotence as Gaza Burned
United Nations chief Ban Ki-moon expressed his "outrage" and the President of the General Assembly, Miquel d'Escoto Brockmann, accused Israel of violating international law.
"Gaza is ablaze," he told the UN General Assembly, "it has been turned into a burning hell."
The UN's Special Rapporteur for Human Rights in the Occupied Territories, Professor Richard Falk, characterized the Israel offensive as containing "severe and massive violations of international humanitarian law."
But an outspoken US lawyer isn't overly impressed with the indignant words of Ban, Brockmann, or Falk.
"Saying is one thing," according to international attorney Francis A. Boyle, "doing is another."
He accused the UN creating the problem in the first place by what he described as the "illegal" partitioning of the Palestine Mandate that led to a massive displacement of the indigenous Arab population.
"You can never trust the United Nations to do the right thing for the Palestinians. The Palestinians have always been on their own, and they know it," he said, "Abandoned and betrayed by the entire world now for 60 years."
Professor George Bisharat from the Hastings College of the Law at the University of California says the United Nations owes the people of Palestine a moral debt.
"The UN is deeply implicated in the injustices and violations of rights of the Palestinians over the last six decades," he said. "It is not at all clear that the General Assembly had the legal authority to partition Palestine, and the plan it passed in 1947 violated the rights of the indigenous people of Palestine to self-determination.
"The United Nations has owed the Palestinian people a moral debt since that time ? and one that it has never effectively paid."
Author and political scientist, Norman G. Finkelstein, expressed his frustration at the inaction of global leaders, and the inability of the United Nations to even enforce its own resolutions.
"The world does nothing," he said. "Most states are led by cowards and slaves of the United States. The only ones showing any courage right now are the UN agencies in Gaza. Their representatives are telling the truth."
Dr. Mohammad Marandi, head of the Department of North American Studies at Tehran University shares Finkelstein's low opinion of UN leadership.
"While the UN staff in Gaza are doing heroic work," he said, "their statements are not reflected by the higher authorities of the UN or the countries that are represented there."
Boyle, meanwhile, says the legal tools are available to enforce resolutions and international law, but Finkelstein believes it is not simply a question of law, but rather a lack of political will.
"The UN is not impotent," he said. "It chooses to be silent because it is composed of craven slaves of the United States."
Under the current circumstances, says Finkelstein, Israel believes it can act with impunity.
"Why should Israel care? The world is doing nothing. The only hope is public opinion, which is light years ahead of the elected representatives."
The Israeli offensive against Gaza triggered massive anti-Israel protests around the world, and according to Kole Kilibarda, an organizer with the Toronto-based Coalition Against Israeli Apartheid (CAIA), they have an important role to play.
"It is a mistake to view the UN in monolithic terms, and in no way should its actions or inaction serve as a substitute for individuals to organize themselves in their communities to fight and struggle for what they see as just," he said.
"Social change has never come from the UN," Kilibarda said. "At its best, the UN has only managed to legitimize what social movements had fought for over decades and sometimes centuries."
But Kilibarda says it is clear the Israeli leadership is indifferent to the overwhelming majority of world opinion that has condemned their attack.
"Israel was ready for this reaction and it is obvious that the 'media war' was prepared months in advance in an attempt to prevent a repeat of Israel's PR fiasco during its 2006 attack on Lebanon.
"The fact is," Kilibarda said, "Israeli leaders only care about the opinion of politicians in Washington and other world capitals. So long as these governments see a strategic interest in supporting Israeli apartheid as a means of repressing the self-determination of the people living in the Middle East, Israel will continue on its course."
Prof. Bisharat says the real responsibility lies not with the UN itself, but with the handful of powerful nations that run it according to their own interests and moral outlook.
"The UN will likely never become a venue sympathetic to Palestinian rights until it undergoes substantial reform and democratization," he said.
Dr. Marandi says the problem with the UN is that it is undemocratic, and it is unlikely that Israel will face serious condemnation.
"The only thing that will impact events on the ground is a change of attitude by the United States or an increase in resistance [to US influence] by countries such as Egypt, Jordan and Saudi Arabia.
"It is ironic," Dr. Marandi said, "that the United States considers the UN and the UN Security Council to be legitimate bodies, but their key ally ? Israel ? never accepts their resolutions."
Holding Israel Accountable for War Crimes
Israel's reaction to the passage of Resolution 1860 calling for an immediate ceasefire was to dismiss it as an unworkable piece of paper.
Prime Minister Ehud Olmert said since the "terrorist organizations" would not honor it, then why should Israel. Consequently, he and other senior cabinet ministers said they would simply ignore it.
The position taken by Israel was a clear violation of their responsibilities as a member of the world body.
"All members pledge to uphold the charter of the UN and to abide by Security Council resolutions," said Prof. Bisharat.
"However, this resolution was not taken under Chapter Seven of the charter which is the chapter under which enforcement actions -- including the use of force -- are authorized. So Israel can ignore the resolution with impunity."
In fairness, the professor added, Hamas too scorned the resolution, maintaining that its perspective was never heard.
Given the ferocity of the Israeli campaign in Gaza and the extraordinarily high proportion of civilians killed and injured, some governments have begun to call for legal action against Israel for war crimes and crimes against humanity.
Prof. Bisharat outlined two possible courses of action to hold Israel legally accountable for its violations of international law in Gaza.
"One is to form a special international criminal tribunal under the authority of the UN General Assembly to create subsidiary organs under Article 22.
"This would be unprecedented. All special tribunals in the past -- for Rwanda and the former Yugoslavia for example -- have been established by the Security Council."
Prof. Bisharat said the unusual move of seeking a tribunal without UNSC approval is being taken because of the omnipresent threat of a US veto.
"The other course is to refer the matter to the International Court of Justice for an advisory opinion, similar to what was done in respect of Israel's 'separation wall' built by Israel in the occupied territories.
"My sense is that many people internationally, and to an extent in the US, are finally shocked enough at Israel's behavior that real action will be taken," he said.
But, the professor added, it will be a political battle within the General Assembly and no one can precisely predict its outcome.
A good start, according to Boyle, would be to have Israel suspended from the United Nations.
"The UN General Assembly can vote to suspend Israel from all participation in the activities of the UNGA, as well as affiliated agencies, organizations, institutions and other activities," he said, "And this would not be subject to a US veto."
He pointed out that similar measures were taken against the apartheid regime in South Africa and the rump Yugoslavia -- which at the time was being accused of genocide.
"Both of these cases, apartheid and genocide apply to Israel," Boyle said, "and you can quote me on that."
As a condition for its admission into the United Nations, Boyle explained in a recent legal article, Israel formally agreed to accept General Assembly Resolution 181 (II) (1947) (partition/Jerusalem trusteeship) and General Assembly Resolution 194 (III) (Palestinian right of return).
"Israel has repudiated both these resolutions (among other things) and consequently has violated its conditions for admission to UN membership," Boyle wrote.
Prof. Bisharat agrees that, in theory at least, it would be possible to have Israel suspended from the United Nations.
"It is theoretically possible, but highly unlikely," he said, "There are few nations that would brook the wrath of the US that would surely follow any such action."
Boyle has previously offered his services to the government in Iran if they wished to pursue legal action against Israel, and said he is pleased that Tehran -- along with Malaysia and other countries -- appear to be taking his suggestions seriously.
Sometimes described as being a little on the "fringe" or eccentric, Boyle had a sharp response to critics.
"I am the same eccentric person who single-handed won two World Court orders for Bosnia and Herzegovina against the genocidal rump Yugoslavia to cease and desist from committing all acts of genocide against the Bosnians. The first and only time a feat like that has been accomplished in the history of the court," he said.
"And I can do the same for Iran, or anyone else, on behalf of the Palestinians against Israel."
[Baca]
January 21, 2009 ArabComment
I lost my gloves one day in a coffee shop in Geneva, and I tell you, it’s difficult to ride without them when it’s really cold. So as I was paying for a new pair with a credit card, the salesman, whom I knew was from Israel, tried to start some small talk by asking me what my family name means. I told him that it relates to the city of Nablus where my family is originally from.
Suddenly, the most bewildered look was plastered on his face. “Where is Nablus?” he asked, “I’ve never heard of it.” Then, after realizing that I knew he was bullshitting me, he pretended to remember, “Ah, Shkheim you mean?”With my insistence not to learn these ugly names that the deranged Zionists have dug up from oblivion to erase our identity, that name certainly didn’t ring a bell. But now it was my turn. Although I knew where he was from, I asked “And you’re… from?” As he smiled while reminding me, I replicated the same look on his face moments ago. “Israel? Where is that?” Then after a brief pause, “Ah, the land of Canaan you mean. Palestine”.
You see if you want to get biblical on me, there is no such thing as Israel either, and I made that clear to this smartass. Here we were all of a sudden; my family descended from a place called Shkheim, and this guy a Palestinian. God does work in mysterious ways, but I still thanked Him for His small mercies that at least my name was not Zaid Shkheimy. “Have a nice day”, I told my Israeli friend. It was in fact a very cold, but still magnificently sunny day to hit the roads. The gloves warmed up my grip on the bike, but my heart was still frozen. I just cannot stand thieves who steal your gloves, or any other kind of thieves.
It was then that it finally occurred to me. Zionism is a sickness, for it takes much more than just a twisted ideology to make people think like that. It requires a profound leap of immorality of a higher order to instill this mentality in your followers. Zionism is not merely a political movement, but in its essence represents a deeply disturbed view of the world, which is a reflection of a terrible disease of the mind.
Indeed, to deny the existence of a vibrant community such as the Palestinian society in the early twentieth century and describe Palestine as “a land without a people for a people without a land” is a disease of the mind.
To assert property claims over real estate after the lapse of more than 2000 years with the same certainty of title as if one resided there yesterday is a disease of the mind.
To describe the colonial immigration to Palestine of a European people with no proven historical link to the ancient Israelites – and whose great, great recorded ancestors have never set foot there – as some kind of a “return” to that land is indicative of a perverted misunderstanding and misapplication of the verb to “return” and can only be a result of a disease of the mind.
To blame the Palestinians for being unreasonable in rejecting a partition plan in 1947 which gave the Jews, who only owned 7 percent of the land, an astonishing half of Palestine, is a disease of the mind.
To demand of the Arabs at the time to peacefully succumb to such partition, where 86 percent of the land designated for the proposed Jewish state was Palestinian-inhabited and owned land, is a disease of the mind.
To eventually grab 78 percent of Palestine through war and to force the flight of the population through deliberate massacres and then call it a war of independence is a disease of the mind.
To deny the orchestrated massacres and eradications of hundreds of Palestinian villages in 1948 and then denounce the Israeli historians who later exposed this truth as self-hating Jews is a disease of the mind.
To claim that having escaped the horrors of Auschwitz-Birkenau, Treblinka, and Dachau is a justification for the murde expulsion, and occupation of another guiltless people is a disease of the mind.
To legislate that any resident of Poland, Hungary, New York, Brazil, Australia, Iceland, or even Planet Mars, who happens to be blessed with a Jewish mother (yet cannot point to Palestine on the map) has a superior right to “return” and settle in Palestine to someone who has been expelled from his very own land, confined to a squalid refugee camp, and still holds the keys to his house, is a disease of the mind.
To blame God for the theft and occupation of someone else’s land by claiming that it was He who had pledged this land exclusively to the Jews, and to seriously promote the myth of a land promised by the Almighty to His favorite children as an excuse for this crime, is a disease of the mind.
To milk the pockets of the world for the atrocities of the Nazis, while stubbornly refusing a simple admission of guilt, let alone compensation or repatriation, for the catastrophe that befell the Palestinian people is a disease of the mind.
To keep reminding and blackmailing the world of the plight of the Jews under Hitler 70 years ago, while at the same time inflicting on the Palestinians today the same fate of the Jews of the Warsaw Ghetto, is a disease of the mind.
To impose a collective guilt overshadowing Western civilization for the Holocaust and then to criminalize all legitimate historical debate of the nature and extent of that horrific event is a disease of the mind.
To virtually incarcerate the Palestinian people inside degrading cages, destroying their livelihoods, confiscating their lands, stealing their water and uprooting their trees, and then to condemn their legitimate resistance as terrorism is a disease of the mind.
To believe you have the right to chase the Palestinians into an Arab capital city in 1982 and to indiscriminately bombard its civilians for a relentless three months, murdering thousands of innocent people is a disease of the mind.
To encircle the civilian camps of Sabra and Chatila after evacuating the fighters and to unleash on them trained dogs (while providing them with night-illuminating flares for efficiency) and then deny culpability for the carnage is a disease of the mind.
To publicly declare a policy of breaking the bones of Palestinian stone-throwers to prevent them from lifting stones again and to enact this policy is a disease of the mind.
To have the sadistic streak of exacting vengeance on the innocent families of suicide bombers by punishing them with the dynamiting of their home is a disease of the mind.
To describe the offer of giving the Palestinians 80 percent of 22 percent of 100 percent of what is originally their own land as a “generous” offer is a disease of the mind.
To believe that you have the right to continue to humiliate the Palestinians at gun point by making them queue for hours to move between their villages, forcing mothers to give birth at check-points is a disease of the mind.
To flatten the camp of Jenin on its inhabitants and deny any wrongdoing is a delusional condition which is symptomatic of a serious disease of the mind.
To build a huge separation wall under the pretext of security, which disconnects farmers from their farms and children from their schools, while stealing even more territory as the wall freely zigzags and encroaches on Palestinian land is a disease of the mind.
To leave behind, in the last 10 days of a losing war in Lebanon, more than one million cluster bombs which have no purpose except to murder and maim unsuspecting civilians is a product of an evil disease of the mind.
To believe that the entire world is out to get you and to denounce any critic of the racist policies of the State of Israel as an anti-Semite, the latest victim being none other than peace-making Jimmy Carter, is an acute stage of mass paranoia, which is a disease of the mind.
To possess, in the midst of a non-nuclear Arab world, more than 200 nuclear warheads capable of incinerating the whole planet in addition to having the most advanced arsenal of weaponry in the world while continuing to play the role of a victim is a disease of the mind.
Yes, and for that salesman in peaceful Geneva to be so insecure as to refuse to acknowledge the name of the largest West Bank city under his country’s brutal military occupation is, sadly, nothing but an infectious disease of the mind.
That’s all what it is, ladies and gentlemen: Zionism is an incurable disease of the mind.
Take care, and if you ride, do it safely.
Zaid Nabulsi is a lawyer. He spent many years working for the United Nations in Geneva. He has a passion for (glorious) Harley Davidson bikes.
This article was originally published in Jordan’s Living Well magazine
[Baca]
On January 18, 2009, the Associated Press reported that in an interview aired on “Dateline NBC” the Chairman and CEO of Berkshire Hathaway Inc., Warren Buffet said that the “US is engaged in an economic Pearl Harbour.”
A shiver ran down my spine!
There was hardly any comment by any of our national dailies or the leading financial dailies.
Obviously, what Warren Buffet said is open to several interpretations. Whatever it may be, it cannot be good.
Why?
If the United States is engaged in an economic Pearl Harbour, it follows that there must be an enemy. Who is this enemy?
When the Japanese attacked Pearl Harbour, it gave President Roosevelt the pretext to enter World War II, at a time when the nation was against going to war. It was a day of infamy and American blood must be avenged. The rest, as they say is history – but a distorted one at that. It is now widely held that President Roosevelt had received advance warnings about the Japanese attack on December 7, 1941. But the intelligence never reached the US Fleet and the ensuing anger and outrage compelled what was once a reluctant public to join the British induced war against Germany.
But recently, this reference to Pearl Harbour by the neo-cons gave rise to the Global War of Terror in 2001 which postponed the day of financial reckoning by seven years, when President George Bush pumped over US$3 trillion into the war economy.
Recall what the neo-con think tank, Project for the New American Century foretold: “the process of transforming the US into tomorrow’s dominant force was likely to be a long one, in the absence of some catastrophic and catalyzing event like a new Pearl Harbour.”
September 11 was the catalyzing event, the New Pearl Harbour, which enabled the neo-cons to put into action their plan for global domination. And like the events leading to the original Pearl Harbour, President Bush and his regime were warned by eleven countries and were supplied with specific intelligence in the months before 9/11 but no actions were taken.
It was another day of infamy and the United States was led once again by the nose to embark on a military misadventure in Afghanistan and Iraq. The Global War on Terror was unleashed!
This is the third time that a catastrophic event is invoked to justify a certain course of action.
Why?
That it is Warren Buffet who is making this reference is most telling, for he is the hidden economic and financial adviser to President Obama. Warren Buffet has in fact said that Obama is the best man for the job!
Warren Buffet is not the effable businessman that the mass media make him out to be. He is an insider in every sense of the word. He is also the biggest and baddest insider-trader in the world. His so-called financial wizardry is all baloney, a more sophisticated Madoff ponzi scheme!
I have said repeatedly for over two years that there is an on going global currency warfare and what is at stake is the hegemony of the dollar. Warren Buffet knows that if the dollar ends up officially as toilet paper, his fortune and that of his global partnership – the hidden manipulators would be finished.
This message that the US is in an economic Pearl Harbour is meant for the enemy, as yet to be disclosed to the American public. It is a warning no less.
President Obama has echoed the sentiments in the course of his inauguration speech.
Food for thought:
In both the previous Pearl Harbour events, there were advance warnings of the impending attacks on the United States, which were later used as a pretext for waging global wars – World War II and the Global War on Terror.
What is in store for the United States and the world in this, the third and final Pearl Harbour?
Since Warren Buffet has stated that the United States is already “engaged in an economic Pearl Harbour”, I can only conclude that we are going to be in a real big mess very soon – to be precise, the end of the first quarter of 2009!
[Baca]
Thursday, 22 January 2009 22:08
Economics Editor - January 21, 2009 The Independent
[FF Editorial: In Part 5 of the book: “The Shadow Money-Lenders and The Global Financial Tsunami, Matthias Chang reproduced an article he wrote dated November 11, 2007 wherein he advised: “Dump the £. The £ has been artificially overvalued. It is in fact a sick currency, buying the British currency is like ‘jumping from the frying pan into the fire.’ If you trust the British now you deserve to be burnt. Dump whatever £ you have in your portfolio now! This is a no brainer.”]
Fresh concerns about the British economy and fears for the stability of the UK's financial system pushed sterling to new record lows against the dollar, euro and yen yesterday.
One of the world's leading investors voiced the markets' concerns. Jim Rogers, of the Singapore-based Rogers Holdings and co-founder of the Quantum fund with George Soros, told Bloomberg Television: "I would urge you to sell any sterling you might have. It's finished. I hate to say it, but I would not put any money in the UK."
Mr Rogers added that the pound will fall below its record low of $1.0520 reached in February 1985. Given near parity with the euro, it raises the intriguing possibility that the pound/dollar/euro exchange rate could yield a "triple parity".
At the same time, the Office for National Statistics released the latest inflation figures, down sharply to 3.1 per cent in December, from 4.1 per cent in November. Investors took this as a sign of the weakness of demand in the UK economy, rather than of its fundamental strength. Before the official growth figures for the last three months of 2008, to be published on Friday, the Governor of the Bank of England, Mervyn King, warned that the world economy had "fallen off a cliff" and that, for the UK, "total output in the fourth quarter is expected to have fallen sharply. In the first half of this year, the rate of contraction is likely to continue to be marked". Some economists believe that the figure will be -1.5 per cent, one of the sharpest downturns since the Second World War.
Mr King also acknowledged the "risk" that inflation would drop below the target rate of 2 per cent in coming months, and confirmed that the Bank would embrace "unconventional measures" – also known as quantitative easing, or printing money – to stimulate the economy. Most economists believe that inflation will come close to zero before the end of the summer, and, on the RPI measure, will actually turn negative.
The Bank and the Treasury have so far remained relatively relaxed about the decline in sterling, believing that a boost to exports and manufacturing would help "rebalance" the economy, but that may change as the depreciation shows signs of turning into a rout, because of a lack of confidence in the British authorities to manage the situation. Worries about the scale of government borrowings, the cost of bailing out the commercial banks and that the slump in sterling will become self-reinforcing helped to push the pound to an eight-year low against the dollar, an all-time low against the yen and back towards parity with the euro. In trading, the pound crashed as much as 4 per cent to lows of around $1.386, in its biggest one-day slide against the dollar since Britain fell out of the European Exchange Rate Mechanism in 1992.
Neil MacKinnon, director and chief economist at ECU Group, said: "There's a real danger of the decline in sterling becoming a full-blown crisis. The Government and the Bank of England have to change their tune on the pound pretty quickly."
However, John Higgins, of Capital Economics, said: "It is perhaps not surprising that investors are getting increasingly nervous about the health of the UK's public finances. The 5-year credit default swap for the UK government has widened by 25bp since early January. 'Printing press' headlines make for uncomfortable reading. But there is little reason to think that the adoption of quantitative easing should be negative for the pound, any more than for the dollar."
Unlike the dollar and the euro, though, sterling does not enjoy the backing of a large economic area, nor the status of a "reserve currency", its banking sector is unusually large in relation to national GDP (400 to 450 per cent), and the UK economy is forecast, by the IMF and others, to be due for the biggest contraction of any major advanced economy in 2009.
Even weaker demand and output than previously thought is helping to push inflation down by the fastest pace since the recession of the early 1990s. The Government's VAT reduction and heavy pre-Christmas discounting on the high street drove the December CPI down to 3.1 per cent. The RPI, which includes housing costs, plunged from 3 per cent to 0.9 per cent, helped down by lower interest rates. Reductions in clothing and fuel prices were the other significant factors; that the falls were not even bigger may be due to the precipitous fall in sterling. Some economists believe the RPI could decline to as much as –5 per cent for a time in the summer, with the CPI hovering around zero, all of which will keep up the pressure for bank rate moving down from its current level of 1.5 per cent.
Colin Ellis of Daiwa Securities said: "The prospect of inflation getting below zero and staying there is the key reason the Monetary Policy Committee has been cutting bank rate aggressively – and was also arguing behind the scenes for the pot of money the Government gave it to fund security purchases. This asset-buying facility is not strict quantitative easing yet – it will be funded by T-bills, not by creating money – but it sets up a framework for how the MPC will try to reflate the economy once rates get down near zero. That is increasingly only looking like a matter of time."
[Baca]
18 January 2009 , Consortium News
At least Richard Nixon negotiated with Russia, opened doors to China and created the Environmental Protection Agency. What did George Bush achieve?
Many historians already name Bush as the worst president in history. I go further: He may well be our nation's first catastrophic President.
It will take years to clean up the financial fiasco that occurred on his watch, a unique combination of incompetence, corruption and massive social inequity. It will take years to clean up the military mess he leaves behind with one war we should not have fought, another war that is not going well and our greatest enemy, who masterminded the World Trade Center attacks, still alive doing his dirty deeds.
While the Vice President goes from interview to interview on his "torture tour," the President desperately tries to rewrite history in one final public-relations failure while his popularity sinks to 22 percent and the nation eagerly awaits his departure.
Karl Rove's dream of a one-party state was so close he could taste it; yet the one party that now controls Congress and the presidency is the Democratic Party.
The pundits, politicians and hangers-on who gave this catastrophic President their undivided support are now reduced to arguing there should be no prosecutions for crimes. How odd; how sad; how ridiculous; how fitting.
This catastrophic President who inherited a budget surplus from his predecessor leaves his successor a disaster of deficits and debt and joblessness and fear and uncertainty and failure.
This catastrophic President who promised modesty in foreign policy and gave us arrogance and imperial attitudes and a blundering war and scandals of wounded troops, yet permitted Osama bin Laden to escape now gives farewell interviews trying to rewrite the legacy it will take a generation to correct.
This catastrophic President who promised to be a uniter and not a divider polarized Americans against each other, allowed the questioning of the patriotism of Americans who were far wiser than he, and only now unites Americans in disgust at what he did and the desire that he leave.
This catastrophic President, who ran on a platform of law and order, gave us White House counsels and an Attorney General who wrote torture memos, corrupted U.S. Attorneys, justified massive violations of eavesdropping laws and left office with the desperate hope that they themselves will not be investigated or prosecuted for crimes.
This President who ran as a CEO gave us the incompetence and bungling of Katrina, the unregulated markets that led to catastrophe from bankers and masters of the universe, and bailouts that spend trillions of dollars of taxpayers’ money, a vast sum that has helped those who caused the mess without providing help to those who suffered from the mess.
Many historians already call Bush the worst President ever. I nominate him for a higher honor: America's first catastrophic President.
Brent Budowsky was an aide to Sen. Lloyd Bentsen and to Rep. Bill Alexander, then the chief deputy whip of the House. He can be read in The Hill newspaper, where he is a columnist. He can be reached at brentbbi@webtv.netThis e-mail address is being protected from spambots. You need JavaScript enabled to view it .
[Baca]
16 January 2009
Next week, "change is coming to America," as President George W. Bush wraps up his tenure as one of the worst American presidents ever. He wasn't able to accomplish such an ignominious feat all by himself, however; he had a great deal of help along the way. The Progress Report heralds the conclusion of the Bush 43 presidency by bringing you our list of the top 43 worst Bush appointees. Did we miss anyone? Who should have been ranked higher? Let us know what you think.
1. Dick Cheney -- The worst Dick since Nixon. The man who shot his friend while in office. The "most powerful and controversial vice president." Until he got the job, people used to actually think it was a bad thing that the vice presidency has historically been a do-nothing position. Asked by PBS's Jim Lehrer about why people hate him, Cheney rejected the premise, saying, "I don't buy that." His top placement in our survey says otherwise.
2. Karl Rove -- There wasn't a scandal in the Bush administration that Rove didn't have his fingerprints all over -- see Plame, Iraq war deception, Gov. Don Siegelman, U.S. Attorney firings, missing e-mails, and more. As senior political adviser and later as deputy chief of staff, "The Architect" was responsible for politicizing nearly every agency of the federal government.
3. Alberto Gonzales -- Fundamentally dishonest and woefully incompetent, Gonzales was involved in a series of scandals, first as White House counsel and then as Attorney General. Some of the most notable: pressuring a "feeble" and "barely articulate" Attorney General Ashcroft at his hospital bedside to sign off on Bush's illegal wiretapping program; approving waterboarding and other torture techniques to be used against detainees; and leading the firing of U.S. Attorneys deemed not sufficiently loyal to Bush.
4. Donald Rumsfeld -- After winning praise for leading the U.S. effort in ousting the Taliban from Afghanistan in 2001, the former Defense Secretary strongly advocated for the invasion of Iraq and then grossly misjudged and mishandled its aftermath. Rumsfeld is also responsible for authorizing the use of torture against terror detainees in U.S. custody; according to a bipartisan Senate report, Rumsfeld "conveyed the message that physical pressures and degradation were appropriate treatment for detainees."
5. Michael Brown -- This former commissioner of the International Arabian Horse Association was appointed by Bush to head FEMA in 2003. After Katrina made landfall as a Category 4 hurricane, Brownie promptly did a "heck of a job" bungling the government's relief efforts, and was sent back to Washington a few days later. He was forced to resign shortly thereafter.
6. Paul Wolfowitz -- As Deputy Secretary of Defense from 2001 to 2005, Wolfowitz was one of the primary architects of the Iraq war, arguing for the invasion as early as Sept. 15, 2001. Testifying before Congress in February 2003, Wolfowitz said that it was "hard to conceive that it would take more forces to provide stability in post-Saddam Iraq than it would take to conduct the war itself." Wolfowitz eventually admitted that "for bureaucratic reasons, we settled on one issue, weapons of mass destruction," as a justification for war, "because it was the one reason everyone [in the administration] could agree on."
7. David Addington -- "Cheney's Cheney" was the "most powerful man you've never heard of." As the leader of Bush's legal team and Cheney's chief of staff, Addington was the biggest proponent of some of Bush's most notorious legal abuses, such as torture and warrantless surveillance, and is a loyal follower of the so-called unitary executive theory.
8. Stephen Johnson -- The "Alberto Gonzales of the environment," EPA Administrator Johnson subverted the agency's mission at the behest of the White House and corporate interests, suppressing staff recommendations on pesticides, mercury, lead paint, smog, and global warming.
9. Douglas Feith -- Undersecretary of Defense for Policy from 2001-2005, Feith headed up the notorious Office of Special Plans, an in-house Pentagon intelligence shop devised by Rumsfeld and Paul Wolfowitz to produce intelligence to justify the invasion of Iraq. A subsequent investigation by the Pentagon's Inspector General found the OSP's work produced "conclusions that were not fully supported by the available intelligence."
10. John Bolton -- As Undersecretary of State, Bolton offered a strong voice in favor of invading Iraq and pushed for the U.S. to disengage from the International Criminal Court and key international arms control agreements. A recess appointment landed Bolton the job of U.S. ambassador to the United Nations, despite his stringent animosity toward the world body. Today, he spends his time calling for war with Iran.
11. John Yoo -- As a lawyer for the Justice Department's Office of Legal Counsel, Yoo authored a series of legal memos giving military interrogators authority to use torture and coercive techniques when interviewing terrorist suspects. Yoo said that only those techniques that inflict pain equivalent to "death, organ failure or permanent damage resulting in a loss of significant body functions" constitute torture. Last year, he refused to answer whether or not the president could order a detainee to be buried alive.
12. Ari Fleischer -- Bush's first press secretary helped redefine the role as that of liar-in-chief rather than informer of the public, earning a reputation as "the world's most dishonest flack." Whereas his successors sometimes looked uncomfortable lying, Fleischer was having fun, spinning a cowed and gullible press corps through two massive tax cuts and the initiation of a war undertaken on false pretenses.
13. John Ashcroft -- In 2003, as Bush's first Attorney General, Ashcroft approved waterboarding and other torture techniques on detainees. Ashcroft's nomination was controversial, as he had a history of opposing school desegregation. The chief architect of the invasive Patriot Act, Ashcroft maintains to this day that Bush is "among the most respectful of all leaders ever" of civil liberties.
14. Henry Paulson -- Even as the financial system was crashing down around him, Treasury Secretary Paulson insisted for months that the banking system was "safe and sound." Once he decided that the economy needed saving, Paulson requested nearly unfettered authority to send billions of taxpayer dollars to banks with no oversight.
15. L. Paul Bremer -- This Presidential Medal of Freedom winner took over the Coalition Provisional Authority in May 2003. Under his mismanagement, the insurgency exploded in Iraq. Bremer claimed he had all the troops he needed to secure the country, overestimated the strength of the new U.S.-trained Iraqi army, disbanded the Iraqi army leaving thousands of Iraqi soldiers with no income and no occupation, and enacted a de-Baathification law that barred many experienced Iraqis from government positions.
16. Bradley Schlozman -- As a recent DOJ Inspector General report demonstrates, Schlozman was a central figure in Bush's politicization of the Justice Department. Violating civil service laws, Schlozman used political and ideological considerations to ensure that only "right-thinking Americans" received jobs. He eventually lied to Congress about his efforts.
17. J. Steven Griles -- A former energy lobbyist and no. 2 official in the Interior Department, Griles went to jail for lying to Congress about illegal favors he did for corrupt lobbyist Jack Abramoff. Griles also abused his position "to unlock nearly every legal barrier to exploitation" of our nation's oil and mineral reserves. Before his conviction, Griles left the White House to become a lobbyist for ConocoPhillips.
18. Condoleezza Rice -- As Bush's national security adviser, Rice was another strong advocate for invading Iraq, once famously warning that the U.S. should attack Iraq and not wait for solid proof of its WMD because "we don't want the smoking gun to be a mushroom cloud." Rice also ignored an urgent warning from the CIA before the Sept. 11, 2001, terrorist attacks that a strike inside the U.S. was imminent.
19. Scooter Libby -- Cheney's former chief of staff was a key player in the outing of CIA operative Valerie Plame as part of the Bush administration's quest to punish Plame's husband, former ambassador Joseph Wilson, for publishing an op-ed debunking one of the White House's main justifications for invading Iraq. Libby was ultimately convicted of perjury and obstructing justice in a federal investigation into Plame's outing but later had his 30-month prison sentence commuted by Bush.
20. Monica Goodling -- Goodling was the most notorious graduate of Pat Robertson's Regent University during her tenure in the Justice Department. As the White House liaison at the DOJ, she based the department's hiring of candidates on their sexual preference, GOP loyalty, and adherence to conservative ideology.
21. Alphonso Jackson -- As Housing and Urban Development Secretary, Jackson let the U.S. housing market crumble while he was busy giving lucrative contracts to his golfing buddies, retaliating against Bush critics, and erecting giant photo homages to himself.
22. Michael Hayden -- As director of the National Security Agency, Hayden ran Bush's warrantless wiretapping program and misled Congress about the program's legality. After moving to the CIA, he dismissed the destruction of evide
