Moon of Alabama Brecht quote
June 30, 2008

Short Thought

Anybody who is long oil, i.e. bets on higher crude prices, has an interest to instigate War on the 70+ million people of Iran.

Oil rises to record on concerns about Iran

Posted by b on June 30, 2008 at 03:40 PM | Permalink | Comments (9)

Taliban or Local Strongmen?

The weekend's action around Peshawar in the Pakistani province Khyber Agency seems to have been a ruse. The Pakistani government sent in local paramilitaries to fight alleged Taliban there. But there was not much of a fight at all. The LA Times writes:

With plenty of warning from officials that troops were coming, Islamic insurgents in the mountainous Bara district outside Peshawar, the provincial capital, had simply melted away, disappearing into a remote valley to the north.

It may have been even more of a show as Syed Saleem Shahzad reports for ATOL:

Riding with the paramilitary convoys was Haji Namdar, the chief of the self-proclaimed pro-Taliban organization Amal Bil Maroof Nahi Anil Munkir that is based in Khyber Agency. His presence was meant to be a secret as his organization was supposed to be one of the targets of the operation.

He was taken along to ensure that encounters with militants were kept to a minimum, as was the case - only four people were arrested and none killed.

The groups temporarily pushed away were local warlords rather than some threatening Taliban. LAT:

[A]lmost no one in Bara's dusty and deprived main town had anything bad to say about the vanished warlord, Mangal Bagh, an illiterate bus driver-turned-cleric. Bagh maintained law and order, people said, and the shadow government he set up in recent months was more effective than the state-sanctioned one.

As his constituency seems to like him, the man will certainly be back.

The whole campaign was simply a big show put up by the government of Pakistan which is under pressure from Washington and NATO to do something.

Just like the U.S. blames every problem in Iraq on Iran, NATO and the U.S. see every problem in Afghanistan connected to alleged Taliban in Pakistan's eastern provinces.

The Canadian journalist Graeme Smith says that is wrong. In an interview form Kandahar with RealNews he explains that the center of the insurgency is in Afghanistan. Even if a wall would be build between Pakistan and Afghanistan, he says, the insurgency would just go on as before.

The insurgency uses hit and run methods on a larger scale. They take control over some towns and disperse as soon as 'western' troops show up and start dropping bombs. Then the insurgency moves into another area and repeats the scheme. There are too few 'western' troops to prevent this.

The result is that people do not feel safe under the protection of the government and its heavy handed 'western' enforcers. Kabul loses legitimization and the Taliban start to get tolerated by the people or even win their direct support.

This year Taliban attacks on U.S./NATO and Afghan forces in eastern Afghanistan are up by 40%. Civilian casualties are up by 60%. That certainly does not indicate that 'western' forces are winning the contest. They drop bombs whenever they have 'intelligence' about the whereabouts of some alleged Taliban leader or group and inevitably kill many civilians. Yesterday 33 'militants' were killed. How many of those were civilians? How many people were wounded in that attack?

Who are these people to turn to for security and to feel safe and protected? Just like the people in Bara, Pakistan, the Afghanis will likely look for local strongmen. The 'western' media will then again mistake those for 'Taliban'.

Posted by b on June 30, 2008 at 12:00 PM | Permalink | Comments (2)

June 29, 2008

Entitlement to Credit

Tony Pugh writes for McClatchy on Credit ripoff: How a $100 purchase turns into a $1,000 debt

The story is about subprime credit cards, how much of a rip-off these are and how finally the regulators are going after some bad behavior by the card issuers. That is all reported well as it should be. To spike an otherwise dry story, the author adds some human interest.

A former Navy hospital corpsman with disabilities, [Wendy] Adams received a popular subprime card — the Aspen MasterCard — in June 2006. She was approved for a $350 credit limit, but when the card arrived, Adams said, she'd already been billed for $285 in processing fees, leaving her only about $65 in available credit.

The above is all we learn on how Ms. Adams got the card. She must have in some way signed up for it. The processing fees are outrages, yes, but why then did she get that specific card? Was she scammed or did she not read the conditions and fees attached to it? The reporter does not let us know.

Adams said she promptly called and canceled the card.

That cancellation was never confirmed in writing by either side and the credit card issuer added interest costs, late fees and over-limit fees to the cards balance. A year later Ms. Wright finds that she owes some $1000+ on that card.

Now that is a problem. But still I wonder why she took out the card in the first place and why she did not cancel it in writing. She signed up for a card, the issuing company checked her credit records and sent her a card. That service was provided for a fee. Why did she believe that the cost for the already provided service would go away when she cancels the card? If you buy a car on credit but do not use it don't you still have to pay for the car?

Ms. Adams now has a credit counselor and some help from the Better Business Bureau. But unless the dispute is solved, her credit rating stays negative. Why is that a problem?

"Because of this, we can't buy our own house. We can't take the tax write-off. We have to pay rent. We have nothing to show for it. We can't buy a car. I can't get a credit card. Our credit is screwed," Adams said angrily.

There goes my last compassion for Ms. Adams. Entitlement to credit is not a human right. She and her also disabled friend can not pay $1,000 they own the credit card company. But they complain about not being able to buy a house AND a car AND more stuff because of the dispute.

Next to reading contracts Ms. Adams should also learn a bit about tax-write-offs. You only get write-offs on taxes that you owne. How much would that be in her case?

"I'm a disabled veteran. I have no money. I make $1,200 a month in disability. I can't work. I'm trying to go back to school, so I don't have $1,100 to fork over to a company that doesn't follow the rules," she said.

Sorry lady, you are a hopeless case.

I am all for better and stricter regulation of credit card issuers. They practice usury, they are vultures and there should be laws to protect their prey. But the reporting on the case does not show any wrongdoing by the company. Yes, the fees and interests are outrageous, but they are also legal. Nobody held a pistol to Ms. Adams' head and made her sign the dotted line.

There are people like Ms. Adams who feel entitled to a house and a car and further credit even as they are unlikely to ever be able to pay for it. Those people are in need of some harsh lessons and the credit card companies provide these. That is the only point where they do deliver a real service and deserve their fees.

Posted by b on June 29, 2008 at 12:09 PM | Permalink | Comments (79)

Hersh on Ongoing Operations Against Iran

Seymour Hersh on Iran: Preparing the Battlefield - The Bush Administration steps up its secret moves against Iran.

There is not much new information in the piece. Hersh mostly pulls together many know bits and pieces on U.S. activities versus Iran.

Hersh confirms the existence of a new secret presidential finding first reported six weeks ago by Andrew Cockburn of Counterpunch.

The finding allows for support of groups hostile to Iran as well as for direct operation by U.S. special commands and by the CIA within Iran including the use of 'defensive lethal force.' It is supported by bipartisan funding of up to $400 million. U.S. operations against Iran are not new, but have now been 'significantly expanded.'

Admiral Fallon, who was been dismissed as Centcom commander, was, according to Hersh, not kicked out over disagreement about an attack on Iran, but for insisting on unity of command and protesting against special force operations that are run outside of the regular chain of command.

According to Hersh groups used to make trouble in Iran include:

  • Ahwazi Sunni Arab groups in south-eastern Iran.
  • Baluchi groups in Afghanistan, Pakistan and Iran including Jundullah, the 'army of god', a radical al-Qaeda like group
  • the Party for a Free Life in Kurdistan, PJAK, that operates in Iraq's northern region.
  • the Mujahideen-e-Khalq cult, MEK, also operating from Iraqi grounds

Hersh reports also that U.S. special operation groups have seized Al Quds commanders in Iran and taken them to Iraq for interrogations.

CIA and the military joint special operations command disagree on using these groups and some of the tactics.

There seems to be an up tick of incidents within Iran that may be related to the U.S. operations there.

Hersh notes that these are 'regime change' operations that have nothing to do with nuclear issues. This new wave of such operations was initiated after the National Intelligence Estimate on Iran published in December found that there is no active military nuclear program in Iran.

Regime change in Iran and control over Iran's natural resources as well as the routes into Central Asia are strategic U.S. foreign policy goals which have bipartisan support. All other issues, including the squabble over nuclear stuff, are simply ways and means to reach those goals.


Somehow I missed the most important sentence of the piece. FCL caught it:

But a lesson was learned in the incident [IRG/US Navy 'interaction in the Gulf]: The public had supported the idea of retaliation, and was even asking why the U.S. didn’t do more. The former official said that, a few weeks later, a meeting took place in the Vice-President’s office. “The subject was how to create a casus belli between Tehran and Washington,” he said.

Posted by b on June 29, 2008 at 04:12 AM | Permalink | Comments (14)

June 28, 2008

Missing Answers on the Pashtun Troubles

There is a fight building up in western Pakistan where some local warlords from the Khyber area under the banner of the Taliban seemed to be near to get control over Peshawar. The Pakistani government sent a few troops and is shelling some alleged warlord camps.

Peshawar and the Khyber Pass region are the route of two thirds of the supplies for 'western' troops in Afghanistan.

In all the reporting about these power struggles in west Pakistan and about the resistance in Afghanistan (if one can separate these at all) two issues are missing.

1. According to this UNHCR request for donations (pdf) there are still 2.1 million Afghan refugees living in Pakistan. Most of their refugee camps are around Peshawar. What is their role in this conflict? What is their position? How do they contribute to the fights in Pakistan and in Afghanistan?

2. Over the last decades many workers from Pakistan have been guest working in the Gulf region. In the 80s they were mostly in Saudi Arabia, now more are in Dubai and Oman. Some estimates say that at times 10% of the male workforce of Pakistan was working in the Gulf region. Pakistan has a Sufi tradition. The radical interpretation of Islam the Taliban adhere to is in the Wahhabi tradition of Saudi Arabia. The guest workers and lots of Saudi money were the vehicle to bring Wahhabism to Pakistan. How much control and influence do the Saudis have over the Taliban position? What is their stand on the trouble in Pakistan and the resistance in Afghanistan?

I have yet to find reports and analysis that really dig into these strategic questions. Answers to those questions and strategic concepts following from these are more important than another ten thousand 'western' or Pakistani troops here or there. If there is some radical Islam movement, it is likely Wahhabi. Has anybody ever developed a strategy against that and its source?

Posted by b on June 28, 2008 at 03:17 PM | Permalink | Comments (15)

June 27, 2008

No Post Today

No post today. Well except this one, which has no real content/links because I am busy or whatever.

Seymour Hersh is said to have a piece out this weekend about U.S. clandestine operations in Iran. That might be interesting and we'll look at it when it appears.

In other news, casualties in Iraq are up, casualties in Afghanistan are up and the U.S. economy is tanking.

As GM reaches a new low let's remember "What is good for GM is good for America." 

  • GM has a problem funding health care for its workers. Universal health care would be good for GM and America.
  • GM has a problem with fuel efficiency. Better fuel efficiency standards would be good for GM and for America.
  • GM has a problem with defaults on unregulated loans. Regulated loans would be good for GM and for America.

So that phrase (which is false in its origin) still holds.

Posted by b on June 27, 2008 at 03:18 PM | Permalink | Comments (24)

June 26, 2008

Juan Cole and the Iraq Public Opinion

Prof. Juan Cole points to an air attack by the U.S. forces in Iraq which killed another family and concludes:

This sort of thing is why the Iraq public wants any Status of Forces Agreement between the Iraqi government and the US to ensure that US forces can only deploy force with the agreement of the Iraqi government.

That conclusion is nonsense.

The 'Iraq public' certainly never asked for or wants a Status of Force Agreement. All available polls find that the majority of the Iraq public wants the U.S. forces to completely leave Iraq.

Indeed only U.S. puppets in the Green Zone, who's position depend on backing by U.S. forces, do argue for such an agreement.

To what purpose is Prof. Cole making this false assertion?

Posted by b on June 26, 2008 at 05:38 AM | Permalink | Comments (51)

The Guardian's Mysterious Tsvangirai Op-ed

Morgan Tsvangirai is the 'western' supported opposition leader in Zimbabwe who runs against Robert Mugawe.

Yesterday the British Guardian published an op-ed by Tsvangirai which called for military intervention. That op-ed has since been taken down from the Guardian website.

Today the Guardian publishes a letter by Tsvangirai, that delegitimizes yesterdays comment which is still available via the Google cache:

Why I am not running

Morgan Tsvangirai

My people are at breaking point. World leaders' bold rhetoric must be backed with military force

Our call now for intervention seeks to challenge standard procedure in international diplomacy.
We envision a more energetic and, indeed, activist strategy. Our proposal is one that aims to remove the often debilitating barriers of state sovereignty, which rests on a centuries-old foundation of the sanctity of governments, even those which have proven themselves illegitimate and decrepit.
We do not want armed conflict, but the people of Zimbabwe need the words of indignation from global leaders to be backed by the moral rectitude of military force. Such a force would be in the role of peacekeepers, not trouble-makers. They would separate the people from their oppressors and cast the protective shield around the democratic process for which Zimbabwe yearns.

The op-ed also spits with hate towards Mugawe calling him "a power-crazed despot." Picking from the above comment, the 'western' media repeated the call for military intervention.

Today there is a full retraction of the above. In his letter to the Guardian Morgan Tsvangirai now writes:

An article that appeared in my name, published in the Guardian (Why I am not running, June 25), did not reflect my position or opinions regarding solutions to the Zimbabwean crisis. Although the Guardian was given assurances from credible sources that I had approved the article this was not the case.
By way of clarification I would like to state the following: I am not advocating military intervention in Zimbabwe by the UN or any other organisation.

I find no editorial explanation on the Guardian website on what happened here.

  • How did the Guardian get the first piece?
  • Who assured the Guardian that the piece was written or at least authorized by Morgan Tsvangirai?
  • How did the Guardian check the claim that its was authorized?

Conspiracy minded people will smells an 'Information Operation' campaign by some USuk group that forgot to make sure that they really held the strings of their puppet. There may be other non-nefarious explanations. The Guardian urgently needs to tell why and how this happened.

Posted by b on June 26, 2008 at 03:46 AM | Permalink | Comments (14)

June 25, 2008

The War On Tourism

As someone who has traveled quite a but in the U.S., on business trips and on vacation tours, I am dismayed with all the new regulations that make such trips psychological and physical very uncomfortable.


  • The U.S. will pick up at least 15 personal data entities about someone coming from Europe through the flight operator. It will keep that data for at least 15 years and may distribute it to who knows who.
  • The traveler will have to fill out some some stupid from on a U.S. government website at least three days prior to boarding the plane.
  • On arrival the guest's laptop may be seized without cause and without knowing when, if ever, it will be given back. Data on a mobile phone or memory sticks may get copied.
  • Also on arrival fingerprints will be taken and checked against some mysterious database. Soon the same procedure will apply when the traveler leaves the country.
  • The newest idea in Congress is to charge some $25 entrance fee to the U.S. Guess what for ... to promote foreign tourism to the U.S.

Sometime in 1999 my boss sent me off on an emergency trip (twelve hour notice) to San Fransisco to cut a fast deal with some dot com venture. I was booked from Hamburg to Frankfurt to Washington DC to SF on Lufthansa and United. Because of bad weather in Frankfurt and congestion delays in Heathrow I ended up flying Hamburg, London, LA, SF by three airlines I had not booked with and arrived just in time but without my luggage. On the way I hacked a business and negotiation plan into my laptop and exchanged some highly sensitive emails with my boss.

We actually cut the deal after some very personal negotiations but ended up paying too much to the U.S. partner. Today such a business would be impossible. The airlines will no longer allow such emergency flight switching, sensitive data on a laptop may kill your company and not many managers like the personal disparagement that now comes with the entry of the U.S.

Not one of the above measures would have prevented 9/11. What is their purpose? Cui bono?

I will likely never again canoe through the everglades, hike the woodsin sight of Mount St. Helens or visit the Jamestown railroad museum in east California. That is sad, but there are nice places elsewhere too. Not everyone fights in this war on tourism.

Posted by b on June 25, 2008 at 02:57 PM | Permalink | Comments (20)

Flathead's Reality

Flathead attempts to rewrite history:

That also helps explain why Iraqis initially never took ownership of their governing institutions, like the Coalition Provisional Authority, or C.P.A. They never fought for it. It was handed to them.


Citing UN Security Council Resolution 1483 (2003), and the laws of war, the CPA vested itself with executive, legislative, and judicial authority over the Iraqi government from the period of the CPA's inception on April 21, 2003, until its dissolution on June 28, 2004.
The CPA was created and funded as a division of the United States Department of Defense, and as Administrator, Bremer reported directly to the Secretary of Defense.
Wikipedia: Coalition Provisional Authority

Why do they even pay this guy?

Posted by b on June 25, 2008 at 01:57 AM | Permalink | Comments (7)

June 24, 2008

Bushian Diplomacy

Bush cancels South Korea trip.

The people of South Korean were unwilling to serve him Texan steaks.

Posted by b on June 24, 2008 at 03:00 PM | Permalink | Comments (21)

Zimbabwe - 'His Ward Abandoned Him'

When the 'western friendly', neo-liberal ruler of Kenia Mwai Kibaki manipulated the election results, the U.S. and other 'western' powers backed him and urged the somewhat socialist and winning opposition politician Raila Odinga into a 'national unity' government.

When the 'western unfriendly', somewhat socialist ruler of Zimbabwe Robert Mugabe manipulated the election results, the U.S. and other 'western' powers backed the neo-liberal opposition politician Morgan Tsvangirai and tried to prevent a 'national unity' government.

But now something went wrong. The opposition candidate Tsvangirai gave up and took refuge in the Dutch embassy.

On page 1 of the conservative German daily Franfurter Allgemeine Thomas Scheen is frank in  explaining some relations (my translation and emph.):

If Tsvangirais retreat is serious and not only a tactical maneuver he will have to justify this to the foreign money sources who financed his campaign in the first election round, especially to America and Great Britain.

When ZANU-PF forged the first rounds result and Tsvangirai fled to South Africa the American ambassador there is said to have ordered him back to finish the campaign. The same ambassador last week vehemently refused to agree to a stop of the second election round and to allow the forming of a national unity government. He declared the second election round to be a matter of survival for the country. Now his ward abandoned him.

I'd say the only people Tsvangirai will have to 'justify' this to are his voters. That is also exactly what he plans to do.

Anyway. Zimbabwe Under Siege, was written by Gregory Elich six years ago and published in Swans Commentary. It captures the colonial, political-economic background of the Zimbabwe issue that is still so much in play today. It is not short, but well sourced and well written. I recommend it.

Posted by b on June 24, 2008 at 03:31 AM | Permalink | Comments (7)

June 23, 2008

Josh Marshall Hit By Electric Shock

Josh Marshall is Shocked, Shocked ... that General Motors starts a crash program to develop an electric powered car.

It's sort of inspiring to see an American company try something so ambitious.

Let's just say that I can not find the company which killed its own EV-1 inspiring for building it again. 

Anyway here comes the whopper:

On a related note, I've been finding myself thinking more and more about alternative energy sources -- or more specifically non-fossil fuel energy sources. [...] [A]s I got older and thought more about politics and began to write about it for a public audience, I cannot say it's ever been a real focus for me.

So Marshall, a historian and journalist, has written about U.S. foreign policy and internal U.S. political bickering without ever considering the main driver of these? Fossil fuels and how to profit from them? Oh boy ...

But that's changed over the last several months: most of the key issues that face us today, from environmental issues proper, to our geostrategic position vs. other great powers and the future of our economy, all turn on our reliance on fossil fuels. Not just 'foreign' ones, all of them.

Higher gas prices really seem to wake people up. Hi Josh, welcome to the party. But I am shocked, shocked ... to find that only now people like you are starting to think. What again was Gulf War I about? Pistachios?

It's not hard to imagine historians of 50 or 100 years from now writing the history of our period -- stretching back almost forty years now -- around that central focus.

Oh really?

No. Those historians will wonder how companies like GM could come up with a crash program for electric powered cars without being pressed by journalists to explain where the electricity for those cars would come from.

They will find, 50 or 100 years from now, that journalists of that time believed that
electricity was apolitical and would forever come in unlimited amounts out of wall sockets.

Posted by b on June 23, 2008 at 02:28 PM | Permalink | Comments (30)

Iran War Fantasies

The New Yorker has a looong piece on arch-zionist and casino multi-billionaire Sheldon Adelson. In a small scene described therein, the 'richest Jew in the world' (his words) talks of someone this blog has taken some interest in:

After Emerson’s presentation, Pooya Dayanim, a Jewish-Iranian democracy activist based in Los Angeles, chatted with Adelson. Recalling their conversation, Dayanim observed that Adelson was dismissive of Reza Pahlevi, the son of the former Shah, who had participated in the Prague conference, because, Adelson said, “he doesn’t want to attack Iran.” According to Dayanim, Adelson referred to another Iranian dissident at the conference, Amir Abbas Fakhravar, whom he said he would like to support, saying, “I like Fakhravar because he says that, if we attack, the Iranian people will be ecstatic.” Dayanim said that when he disputed that assumption Adelson responded, “I really don’t care what happens to Iran. I am for Israel.”

When Richard Perle brought Fakhravar to the U.S. in April 2006, the 'student leader' did not speak English and was seen by fellow Iranian exiles as the fraud he is. Now the third riches guy in the U.S. listens to his fantasies of Iranians giving flowers and candies as thank-you for shock and awe.

That's quite a career step.

Flowers and candy expectations and even more dangerous fantasies about a 'cakewalk' are also in a recent pamphlet from the Washington Institute for Near East Policy, an AIPAC too-dumb-to-think think tank.

It is the master narrative for the TV talking heads and 'experts' that will 'discuss' how easy the U.S. will win against Iran shortly before that war begins. John Bolton is already explaining that the Arabs will be 'delighted' when Teheran gets bombed.

While the U.S. people may not be keen for another war, expect less resistance from Europe than there was against the Iraq war. The propaganda campaign against Iran here in Germany is running at full pace. For a while I had the fantasy that the EU-3 are doing the sanction and negotiation bidding with Iran to stall another U.S. aggression by running out the time of the Bush administration.

But that seems no longer to be the case. The EU foreign police head Solana was in Teheran just ten days ago to deliver a new offer (pdf) of negotiations about 'incentives' (there was nothing new in it) if Iran stops enrichment. In May Iran distributed a new proposal (pdf) of its own, offering international industrial partnership in its enrichment facilities.

Despite the possibilities of further talks, without giving Iran time to officially answer the EU-3 proposal and without having issued any response to the Iranian proposal, the EU today put new sanctions on Iran's biggest national bank and froze Iranian assets.

This step came much too early for being part of a stalling strategy.

Posted by b on June 23, 2008 at 12:54 PM | Permalink | Comments (14)

June 22, 2008

Economic War Between OPEC and the U.S. Financial System

Oil markets are in a bubble driven by speculation. While peak oil is a real concern, it does not explain recent short term price moves. People drive less now in the U.S., China has increased its subsidized oil prices by 17.5% and airlines have stopped flying certain routes. Supply has stayed fairly constant. Still prices are going up.

The speculation is driven largely by U.S. financial entities that trade in unregulated commodities with over the counter derivative contracts. F. William Engdahl has explained how the mechanisms works and Pam Martens points to the massive involvement of Citibank and other big players.

The OPEC folks are pissed. They know the prices they are selling their oil for are far below the top prices in the commodity markets and they know that some of the barrels they offer find no buyers. They do know that it is speculation that drives this. The current too high prices will make people develop other energy sources and will destruct the long term demand for their product. They learned that lesson in the 1970s and do not want to repeat it.

At the same time there is a serious systematic attack on OPEC underway in U.S. politics. A year ago Ed Koch, the former mayor of New York, called for more legislative and presidential action to take on OPEC in the Jewish World Review. In May Hillary Clinton said OPEC 'can no longer be a cartel'. This week saw calls for action against OPEC from mainly Democratic legislators and op-eds on the issue in two major papers. On the same day the LA Times and the  NY Times headlined these Sue OPEC.

The Saudis have called for an international meeting on oil prices that is taking place right now. Pat Lang thinks they are very serious about the issue.

The U.S. position is that there is no speculation and no action needed:

US Energy Secretary Samuel Bodman said on Saturday that speculators were not forcing up global oil prices, which nearly hit 140 dollars per barrel this week.

"There is no evidence that we can find that speculators are driving futures prices," Bodman told a press briefing ahead of Sunday's summit in Jeddah that will bring together consuming and producing nations to address the global energy crisis.

Bodman isn't even lying. He can not find the evidence because the U.S. Commodity Futures Trading Commission allows U.S. financial institutions to trade unregulated and unsupervised in the London ICE Futures market. If you don't look for evidence, you will not find any.

OPEC, and especially the Saudis, will have to think of new ways to pressure the U.S. for more regulation in the future markets. They also have to look at serious local inflation issues connected to their currency peg to the dollar. I can think of several possible tools available to them to help on both issues. Watch the dollar to go down much further when this economic war escalates.

This leaves the question why the U.S. administration is allowing such speculation that will likely hurt its party in the next election and might bring serious economic harm. I believe this is out of necessity.

Financial institutions lost about $1 trillion in the credit bubble and many of them are in dire state. The Fed gave them $500 billion in fresh money taking junk bonds as collateral and keeps the interest rates much lower than justified. The banks now again have the money to speculate in the markets and to use the profits from these speculations to heal their balance sheets.

The commodity bubble is to a large part a concerted action to keep the USuk financial system alive. Consumers all over the world and the oil producer have to pay for that.

If the Saudis see this the same way than I do, they will recognize that only severe financial action will stop the scheme.

Posted by b on June 22, 2008 at 02:48 PM | Permalink | Comments (30)

June 21, 2008

Cheney and Friends

by Antifa
lifted from a comment

While it is heartening to hear that bombing Iran is not an act reasonable people would take, that has no bearing on the state of mind within the Cheney bubble. Cheney and Friends are logical and dedicated and skilled about their crazy ass plans. Cheney and Friends look at consequences like reasonable people do, in fact they look at consequences first and foremost, and all consequences come second to keeping America on top, period and permanently.

If the fall of America is to be the consequence, well then a whole lot of hell will have to go down on its enemies first.

The people who want to bomb the hell out of Iran are supremely logical about it, and have been since '79, and have been pushing American hegemony by military means since '89 in the halls of government, and have been actively planning it to the last nut and bolt since 2000.

They've drawn up the several thousands of targets, set a perfectly logical order for them, set aside the fuel and spare tires and chow for the sailors, and parked the carrier fleets on station in the Gulf and the Mediterranean. Ready to shoot. Tomorrow will do, or the next day, or the next. Ready.

Meanwhile, they keep the PR and diplomatic chaos and military position in place until any reasonable excuse arrives to pull the trigger. Any reasonable excuse will do. Polish troops attacking a German radio station will do just fine ...

In 1941, President Roosevelt put an oil embargo in place against Japan to rein in their military adventurism. At that point, it became an absolute economic imperative for Japan to break that stranglehold. War or collapse were their options, and time was short.

America faces a similar stranglehold in the coming decade, yea even now. It was not put in place by an enemy nation, but by the relentless squeeze of peak demand for oil. If America is to keep its place atop the global economy, others have to accept that unipolar world.

Not a likely scenario, absent overwhelming force to put it in place. America is a great, debt-ridden, bloated, staggering economic powerhouse, "too big to fail" and yet it can collapse as quickly as the Soviet Union did. Just as fast, and just as thoroughly.

What would bring on that rapid collapse? Losing the petrodollar, the reserve currency status of the fiat dollar that has let America live way beyond its means for nearly half a century. We get to print endless money, with no apparent consequence to ourselves. Other nations that do that hit the canvas, real quick.

Cheney and Friends, Cheney and the amoral, apolitical elites who simply want to see this economic empire remain a going concern look at the Middle East as America's right, and property. The idea of sharing, or competing fairly for those resources, is beyond the pale. It is something sweet and reasonable people would discuss on a blog somewhere. Not the real world.

In Cheney's world, reality involves tactical nukes, and the will to use them. That act alone will send a message that will reverberate throughout this New American Century.

Like Japan in '41, the oil crunch impends. Either that Iraqi, Saudi, Kuwaiti, Iranian, and Caspian petro wealth all gets sold under the fiat dollar regime, or America has to start living within its means, all of a sudden like.

And America as it exists now, as it is currently owned and operated, simply cannot do that. The current political arrangements cannot survive that.

It was completely unreasonable of Japan to attack America in 1941, as in "What the hell were they thinking?" unreasonable. But they saw no other choice. Like Cheney and Friends now, the Japanese honchos sat around and said things like, "Just 24 hours of decisive action will change the whole world."

To the honchos atop our government and economy, America has no other choice but to defend its economic role in the world, even by nuclear means if necessary. So the rational option is . . . take our oil from whomever is in the way.

If the American people get in the way, that's their problem. Hence we see all the domestic impoverishment and repression coming rapidly into force at home. The American population needs to be under control.

Both political parties know this crunch is coming, long since, and both parties know the option is stark. If there was a gentle way down off this pole, the time to exercise it passed many years ago.

To the people atop our government and empire, there is only one reasonable course, and that is force.

The fact that other reasonable people find this option unlikely and irrational means precisely nothing. When 24 hours of decisive action will change the whole world, what reasonable honcho can resist it?

Posted by b on June 21, 2008 at 09:51 AM | Permalink | Comments (29)

Midsummer Open Threat

Comment early, comment often ...

News & views ...

Posted by b on June 21, 2008 at 01:46 AM | Permalink | Comments (116)

June 20, 2008

Torture Week

It was torture week, with a few hearings and a bit of remarkable reporting on the issue.

"After years of disclosures by government investigations, media accounts and reports from human rights organizations, there is no longer any doubt as to whether the current administration has committed war crimes. The only question that remains to be answered is whether those who ordered the use of torture will be held to account."
Maj. Gen. Antonio Taguba (ret.)

There is not much to add to that.

I recommend everyone to read McClatchy's series written by Tom Lassiter on torture and Gitmo, the Warren Strobel story with the above Taguba quote and the one on how cases like this may now proceed through the courts:

The Taliban tortured Abdul Rahim Abdul Razak al Ginco. They thought he was a U.S. spy. Then, U.S. soldiers called the Syrian native an enemy and shipped him to Guantanamo.

... where he was again tortured.

Declaring torture illegal was one of the big cultural achievements of mankind. This administration and this Congress have taken us back to the middle ages.

The U.S. needs to think seriously about how to change a system that allows such aberration.

Posted by b on June 20, 2008 at 02:16 PM | Permalink | Comments (4)

Michael Gordon's New Beat: Bomb Iran

There is a fresh sign that an attack on Iran is in the cards. The New York Times has put Michael A. Gordon on the bomb-Iran beat. Gordon, you will remember, co-wrote with Judith Miller a bunch of the false Iraq-WMD pieces. But unlike Miller he was not fired and lately his task has been to write Petraeus schmooze pieces from Baghdad.

But now he writes about an attack on Iran and the NYT editors put the baloney on page A01:

Israel carried out a major military exercise earlier this month that American officials say appeared to be a rehearsal for a potential bombing attack on Iran’s nuclear facilities.
Shaul Mofaz, a former Israeli defense minister who is now a deputy prime minister, warned in a recent interview with the Israeli newspaper Yediot Aharonot that Israel might have no choice but to attack. “If Iran continues with its program for developing nuclear weapons, we will attack,” Mr. Mofaz said in the interview published on June 6, the day after the unpublicized exercise ended. “Attacking Iran, in order to stop its nuclear plans, will be unavoidable.”

Only nine paragraphs later does Gordon find the space to somewhat hint that Mofaz's assertions are wrong. Iran does not have a 'program for developing nuclear weapons'.

Gordon also has this false line:

In late May, the International Atomic Energy Agency reported that Iran’s suspected work on nuclear matters was a “matter of serious concern” and that the Iranians owed the agency “substantial explanations.”

The 'serious concern' the IAEA expressed (pdf) related to the false accusations the U.S. made towards Iran, not to Iran's work on nuclear matters.

The alleged studies on the green salt project, high explosives testing and the missile re-entry vehicle project remain a matter of serious concern.

The 'alleged studies' are a matter of concern for the IAEA, not 'Iran's suspected work'. A small but important difference.

Retired Air Force Colonel Sam Gardiner wrote a study about the propaganda build up towards the War on Iraq: Truth from These Podia Summary of a Study of Strategic Influence, Perception Management, Strategic Information Warfare and Strategic Psychological Operations in Gulf II.

Gardiner is now writing at Spinwatch and recently put up this graph:

Gardiner notes:

The volume of English language articles on Iran has increased by over 50% in the past few months. The President has used his trips as a way to magnify the Iran message.

All of this looks and feels like we are being set up for military operations against Iran in the same way we were set up for the invasion of Iraq.

Recently Israel agreed to a ceasefire with Hamas, started negotiations with Syria through Turkey and even offered talks with Lebanon. Obviously Olmert wants to pull the teeth that might bite back in the case of an attack on Iran. These preperations, propaganda about Iran's involvement in attacks in Iraq, the general increased message volume on Iran and Michael Gordon's assignment to his new beat are signs that some campaign is likely to happen.

Posted by b on June 20, 2008 at 03:15 AM | Permalink | Comments (24)

June 19, 2008

Democrats Cave In Again

As expected, the Democritters in Congress caved in on telecom immunity:

The agreement would also pave the way for companies such as AT&T Inc. and Verizon Communications Inc. to shed the nearly 40 lawsuits they face for allegedly participating in a prior version of the NSA program, which have cast a shadow over their reputation on Wall Street and Main Street. To win immunity, they would have to pass review from a U.S. District Court.

Laura at War & Piece has a two good question to Pelosi that gets to the gist of the issue:

Doesn't that actually endorse and extend to private actors the Nixonian view that if the president says it's legal, it's legal, regardless of what the law says and the Constitution says? Wouldn't that set an awful precedent that an administration could get private actors to do whatever they wanted including breaking the law?

Answers: Yes and yes.

Why do Democrats choose to support this? Maybe they do really want that precedent?

I fail to see other reasons here.

Posted by b on June 19, 2008 at 12:13 PM | Permalink | Comments (11)

The Pipeline Through Afghanistan

What is the war in Afghanistan about?

Yes, you guessed it: hydrocarbons. Today's Globe and Mail reports:

Afghanistan and three of its neighbouring countries have agreed to build a $7.6-billion (U.S.) pipeline that would deliver natural gas from Turkmenistan to energy-starved Pakistan and India – a project running right through the volatile Kandahar province – raising questions about what role Canadian Forces may play in defending the project.

To prepare for proposed construction in 2010, the Afghan government has reportedly given assurances it will clear the route of land mines, and make the path free of Taliban influence.
The so-called Turkmenistan-Afghanistan-Pakistan-India pipeline has strong support from Washington because the U.S. government is eager to block a competing pipeline that would bring gas to Pakistan and India from Iran.

The TAPI pipeline would also diminish Russia's dominance of Central Asian energy exports.

The project to build that pipeline was nearly ready in 1998 when Unocal had a deal with the Taliban government and the Northern Alliance.

The deal was stopped in 1998 because no one was willing to finance it:

An internationally-recognised government in Kabul would have paved the way for securing the financing, but American anger at the Taleban for harbouring Osama bin Laden, has, for the time being, stopped that.

Following the US air strikes Unocal suspended its plans.

This time the deal is supposed to be financed by the Manila-based Asian Development Bank.

Still there are several issues that will make it very difficult to build the pipeline.

  • Russian and Iranian (and Chinese?) interests are touched and both have incentives and capabilities to hinder it by various means.
  • As the occupation troops continue to bomb the Afghan population, the support for the resistance against the occupation will increase.
  • It is impossible to 'make the path free of Taliban influence', because the most of the Taliban in that pipeline path is the native population living there.
  • Relations between Pakistan and Afghanistan are getting worse by the day and may endanger the deal.
  • NATO countries will be reluctant to support further action in Afghanistan as the real interests behind these are now revealed.

Until now whoever mentioned such a deal as being behind the Afghan War was seen as falling for conspiracy theories. That will now end and I welcome the discussion that will follow.

Today we also learn that Exxon Mobil, Shell, Total and BP are getting no-bid, two years contracts to 'service' Iraq’s largest fields. This puts them into the position to win further exploration rights.

As the real war reason are now in the open the key question is: How many of their sons and daughters are 'western' democracies willing to get killed in support of such schemes?


Posted by b on June 19, 2008 at 06:44 AM | Permalink | Comments (26)

June 18, 2008

Campaigning It Ain't

U.S. campaign thougth of the day:

If McCain is President we will call it The Nursing House.


Someone timewarp me to December please.

Posted by b on June 18, 2008 at 03:02 PM | Permalink | Comments (13)

Myanmar - The Junta Was Mostly Right

You will remember the 'outrage' in the media about Myanmar denying access by 'westerners' to the people hit by cyclone Nargis.

Today a U.S. government paid guy from RAND builds on that to attack China in the WaPo op-ed pages: China's Responsibility to Protect

The responsibility to protect is being tested today by the Myanmar military junta's refusal to allow massive aid to the victims of Cyclone Nargis, just as it has been tested by the Sudanese government's support for genocide against the people of Darfur.
Now the world is blocked by Myanmar's junta from getting aid to those caught in Nargis's path. The United States and its allies have little sway with the junta, except for force, which they seem disinclined to use. Once again, the country with the greatest leverage is China.
China obviously is big enough to be a world leader. But it is it principled enough? It is time -- high time -- for China to accept the code of conduct that befits a great power in an era of globalization. Nargis gives the Chinese a golden opportunity to do their fellow humans and themselves some good.

What this guy actually wants is China to join the U.S. in raping the rest of the world. (China will not do so.)

To that gain he is peddling false information about Myanmar, the help it did accept and the kind of additional economic help that is needed.

But, oh wonder, today we also get a mainstream media piece that actually reports the realities on the ground in Myanmar. It confirms to me that the junta was mostly right when it said that more 'western' helpers were unneeded.   

Now doctors and aid workers returning from remote areas of the delta are offering a less pessimistic picture of the human cost of the delay in reaching survivors.

They say they have seen no signs of starvation or widespread outbreaks of disease.
Most of the people killed by the cyclone, which struck on May 2-3, drowned. But those who survived were not likely to need urgent medical attention, doctors say.

“We saw very, very few serious injuries,” said Frank Smithuis, manager of the substantial mission of Doctors Without Borders in Myanmar. “You were dead or you were in O.K. shape.”
But relief workers say the debate over access for foreigners and the refusal of the government to allow in military helicopters and ships from the United States, France and Britain overshadowed a substantial relief operation carried out mainly by Burmese citizens and monks.

They organized convoys of trucks filled with drinking water, clothing, food and construction materials that poured into the delta.

“It’s been overwhelmingly impressive what local organizations, medical groups and some businessmen have done,” said Ruth Bradley Jones, second secretary in the British Embassy in Yangon, Myanmar’s largest city. “They are the true heroes of the relief effort.”

That statement leaves out the Myanmar army which was also deployed and helped the people.

Anyway - we see that Myanmar was well able to handle the catastrophe and all the calls for intervention were the re-colonization efforts we suspected them to be.

Earlier MoA pieces on Myanmar:
Myanmar - Politics, Media Manipulation and Help, May 17, 2008
False Weather Warning by U.S. Military to Press Myanmar May 15, 2008
False Intervention, May 10, 2008
Myanmar Asks For Help May 6, 2008 by Debs is dead
Darfur, Myanmar and Masturbation October 9, 2007
Fatuity of Do-Gooders, September 30, 2007
Myanmar Protests September 26, 2007

Posted by b on June 18, 2008 at 07:26 AM | Permalink | Comments (3)

June 17, 2008

Haji Habibullah Jan - Or Why 'The West' Will Lose in Afghanistan

An Afghan warlord and tribal chief welcomed the 'western' attack against Mullah Omar's Taliban. The Talibs were from a different power group than his own and he hoped to get a better deal with the new rulers.

But those 'westerners' put another rival group of his into power. Sure, they gave him a bit power too. He was elected into the parliament and the loot coming with that job made things better. But then the rival group in power screwed him. They used the 'westerners' to fight his interests with deadly consequences.

But he is a smart men and he fights back against these folks with sophisticated public relation. When that does not work, he shows off some of his real power.

The other side responds by again trying to use the 'westerners' to suppress him and his followers.

The outcome of this fight is uncertain. But it definitely shows one thing. Most 'westerners' have no real comprehension of what the conflict in Afghanistan is really about, what Taliban are and are not and why 'the west' will end up defeated in Afghanistan just like Alexander the Great, the British imperialist of the 19th century and the Sowiets.

Thus follows the story of Haji Habibullah Jan, the leader of the small but proud Pashtun Alizai tribe reconstructed from some deep Goggle dives.

It is longish, sorry for that, but it is also a mind opening look into a foreign culture even while based on 'western' news sources.

My search started with this story about the big Afghan jail break every major newssource recently covered. Those reports included this ridiculous line:

Lawmaker Habibullah Jan said some of the hunger strikers had been held without trial for more than two years. Others were given lengthy prison sentences after short trials.

Jan said 47 of the prisoners had stitched their mouths shut during the hunger strike in May.

The emphasised part is of course baloney. Pashtuns ain't fakirs. They do not stich their mouth shut. To reproduce that quote is pure Orientalism. But Habibullah Jan knew that the 'western' press would react to such a juicy quote. That is obviously the reason why he put it out.

Still I wondered who that loudmouth is and why he did this. Here is what I came up with.

The earliest story to find about Habibullah Jan is from April 2002. Under the headline Afghanistan looks to life without warlords we find an interview with, oh yeah, a warlord:

Habibullah Jan was 16 when he took up a gun in 1978 and joined the "holy war." His father, a tribal leader, had been imprisoned by the new communist regime. "He's still missing," Habibullah notes, for the record.

Today Haji Habibullah is a heavyset man, with soft black beard, who chain-smokes Marlboro Lights through thick fingers. He is, in effect, a brigade commander for Naqibullah, with more than 2,000 men in his charge. His entire adult life has been spent in fighting and exile, victory and defeat.

"We finally drove the Russians out and the communist government collapsed. But our bad luck was that the mujahedeen came into power. They can't sit down together," Habibullah said. "The second bit of bad luck was that the countries that supported us abandoned us."

Which country abandoned the resistance in Afghanistan after the Russians were defeated? Yes we know, the U.S did so. But Haji Habibullah Jan was ready to forget and to compromise:

Now that the Americans are back, Habibullah said, the "international community" must help finance and train a new national army to impose order on a disorderly map. "I hope that will mean the end of the warlords."

In 2004 some folks from Medicines Sans Frontieres asked for help from Habibullah:

In thirty minutes we arrived at our first destination, the compound of Commander Habibullah Jan in Senzari village. Habibullah Jan is security responsible for the area around the road leading to Helmand province west of Kandahar. His private army patrols the tracks and valleys of this region, often coming into conflict with destabilization forces. He was holding court in front of his compound with a group of elders as a smartly uniformed guard with a handlebar moustache waved us in.
He's an impressive man, strongly built and well dressed. He assured us there was no problem along the road to the camp and that he had many patrols in the surrounding area.

Haji Habibullah is also a smart man who has seen the world. He not only went to Mecca, but as part of an Afghan delegation which also included Hamid Karzai's brother Wali, visited Dubai and Japan in mid 2004.

The Washington Post spoke with Habibullah at a presidential election rally Hamid Karzai held in Kandahar in 2004.

The local military commander, who goes by the single name Habibullah, was busy preparing the rally and ticking off lists of tribes that had sent representatives. He said he had a good official relationship with the central government, but his Pashtun heart was clearly with Qanooni, the Tajik mujahid from Panjshir.

"When I was a boy, I carried a Kalashnikov on my shoulder. I do not want my children to carry a gun," he said, adding that he supported militia disarmament. But he complained that Karzai and many of his aides had lived in exile during the country's most bitter years and still keep foreign passports. "I am a citizen and I have the right to one vote," he said, "and it will not be for Karzai."

In 2005 Habibullah Jan was himself up for election as a candidate for a the Wolesi Jirga, the Afghan parliament. Unfortunately, as the Pakistani Dawn reported from Kandahar on September 5, 2005, that candidacy killed him:

Candidate Habibullah Jan was killed by the Taliban, provincial chief Abdul Rahman said.

“He was wounded by a mine planted outside his house and taken to hospital where he died,” he said.

Well, maybe not. On October 9, 2005 Haji Habibullah Jan got 5,928 votes and was thereby elected as member of the parliament. (Only 25% of the registered voters did actually bother to get a purple finger.)

Between 2005 and 2007 there is nothing I find about this Habibullah. Those years seem to have been relatively peaceful times.

But then stories including him again start to come up again. In September 2007 the Canadian Globe and Mail quotes him:

"The Taliban are much weaker than last year," said Habibullah Jan. "They can’t stay and fight if they’re confronted."

Habibullah the optimist who certainly does not like the Talibs. But soon thereafter trouble starts. Two Mullahs in Habibullah's district get killed by U.S. special forces.

Hundreds of enraged Afghans, some chanting "death to Canada," blocked a highway Wednesday following a raid by foreign troops that left two religious leaders dead.
Canadian military officials have denied involvement in the raids by both their own soldiers and NATO's.
"Their informers are giving them wrong information," one protester told CP, referring to the information that led to the raids. "It is disgusting."
Habibullah Jan, a lawmaker from Sanzari village, told the Associated Press that NATO forces were responsible for the deaths.

He warned that if international forces continued to target civilians, "people will take up arms against the government and NATO."

Besides killing two religious leaders the U.S. military also took some prisoners.

One Afghan man at the protest told CBC News that he had guests in his house when soldiers burst into the building. "The soldiers tied their hands and feet, covered their eyes and took them away," he said. Another witness said the raids were by American and Canadian soldiers, who took eight people and killed two.

It is a central issue in Pashtun tribal code to defend their guests.

Habibullah's son joined the protest:

Neither the Canadians nor other NATO soldiers were involved in the raids, a military spokeswoman said; the only other foreign troops operating in the area belong to U.S. Operation Enduring Freedom, a counterterrorism force.
The slain men belonged to the Alizai tribe, a group disenfranchised from the government, and their deaths happened in a Kandahar suburb known as Senjaray, south of Highway 1, a ramshackle warren of mud huts that is notorious for hiding Taliban. Insurgents were spotted among the protesters yesterday, and elders say it took some effort to dissuade the mob from marching into Kandahar city.
"This is the biggest protest we have had in years," said Hyat Ullah, 21, the son of local parliamentarian Habibullah Jan. "We ask the foreign forces to be very careful, to avoid getting into personal fights between people. These things make big problems."


Half of the U.S. military in Afghanistan is not under NATO command but is kind of freelancing. This is a ridiculous situation and a main cause for all the trouble in Afghanistan. Unity of command is a MUST in all military endevaours.)

Now things get a bit more complicate as we have to dive into Afghan tribal culture (scroll down).

The 13+ million Pashtun in Afghanistan have two branches, the Durrani and Ghilzai. There are Zirak Durrani and Panjpai Durrani. The Zirak Durrani are government aligned. One of the tribal group in these are Popalzai with their most prominent member being President Hamid Karzai and his brother, Ahmed Wali Karzai. Wali plays a major role in Kandahar as chairman of the provincial council.

After the Sowiets left Afghanistan, the Zirak Durrani dominated Kandahar. When the groups under Mullah Omar got into power, they disenfranchised the Zirak Durrani in favour of their own Ghilzai subgroup. Now the Zirak Durrani rule again and they disenfranchise all others.

One tribal group in the non-government aligned Panjpai Durrani are the Alizai. notes on the Alazai:

A bitter conflict between this tribe's leader in Kandahar, Habibullah Jan, and Ahmed Wali Karzai was a source of instability in the province until the two men reached a negotiated truce in recent weeks."

What was the reason for the bitter conflict? A fight about drug profits or some other loot? Did Wali Karzai, who has an MA from USC, send the Americans to kill the two Mullahs from Habibullah tribes?

We don't know. But something serious had happened and that 'negotiated truce' did not hold long.

A recent Times article about Wali Karzai's drug connections says:

At the end of last year, Habibullah Jan, a powerful tribal chief and member of parliament from Kandahar, became the first person to accuse Wali directly in parliament of involvement in the drugs trade.

That was a big embarrassment for the Karzai brothers as it made some international waves. There even seems to be some truthiness to it.

Another Kandahar MP made a similar allegation, but would speak only off the record.

A senior Afghan security official, who also asked not to be identified, claimed that Afghan officials had repeatedly complained about Wali to President Karzai. “The problem is that neither the Americans nor the Europeans are interested in doing anything about this,” he said.

Why are the 'westerners' not interested? They need both Karzais:

[Others] say that Wali brings co-operation and stability to the south, principally by maintaining the dominance and loyalty of President Karzai's tribe, the Popalzai.

Stability? Like more tribal feud? The Karzai brothers seem to have lost the senses to manage stuff on the ground.

Hamid Karzai last year selected the son of the deceased leader of the Alokazai tribe, which usually supports him, as the new chief of the tribe. That was a big mistake as the move was against the tribal rules where the elders decide about such, not the Afghan king and member of another tribe. Now the Alokazai are unruly and 'taliban' activity is up in their area.

So there are essentially feuds going on here. Habibullah never liked the Karzais anyway, but went along with the tide. Only after some U.S. forces, who support the Karzais rule in Kabul and Kandahar, raid his people, kill two of their religious leaders and take others as prisoner, he really  gets pissed. He starts to denounce Wali Karzai in parliament and makes this a major issue with the foreign press.

The next we hear of him is last month, when he visited unruly prisoners in Kandahar:

More than 200 Taliban suspects ended a weeklong hunger strike at a prison in the southern Afghan city of Kandahar after a parliamentary delegation promised their cases would be reviewed, a lawmaker said Monday.

Lawmaker Habibullah Jan said the three-member delegation received written demands from the prisoners and would pass them on to President Hamid Karzai's government in Kabul.

To get 'western' press attention a public relation experienced Habibullah came up with the colourful picture:

He said some of those on the hunger strike had been held without trial for over two years. Others were given lengthy prison sentences after short trials. Jan said 47 of the prisoners had stitched their mouths shut during the strike.

The inmates had been captured by Afghan, NATO and U.S.-led forces, who are battling a fierce Taliban-led insurgency in the south, Jan said.
The Kandahar prison is under the jurisdiction of Afghan authorities.

The Afghan authority in Kandahar is Ahmad Wali Karzai.

How many of Habibullah's tribesmen were in the prison he visited? How many had been labeled 'taliban' and incarcerated by his rival Wali Karzai and his U.S. forces?

The next thing we hear, only a few days after Habibullah pacified the prisoners (with what?), is the big prison break:

More than 1,100 inmates of a prison in southern Afghanistan, including militants, escaped after a Taliban suicide attack on the building, the NATO force in Afghanistan said Saturday.

After this PR disaster Hamid Karzai tried to divert criticism by threatening to attack Pakistan. That didn't help much.

But now, he lets us know, the area west of Kandahar, the main area of Habibullah Jan's Alazai tribe and some Alokazai, is suddenly in Taliban hands:

The Taliban have taken control of 18 villages west of the Argandab River and started digging trenches and mines, a tribal elder from the region said. NATO and Afghan forces moved troops in to the region and dropped leaflets from the air warning civilians to stay inside their homes if fighting erupted in their area.

Dropping leaflets in an area where most people are illiterate may not be good tactics. Anyway -  are those people really 'taliban' or is Karzai cooking up some atrocity to punish the rival tribe and its head, Haji Habibullah Jan?

The United States military said a patrol of Afghan police and American and allied forces conducted a five-hour patrol from daybreak on the west side of the Argandab River valley, where there have been reports of Taliban fighters. The patrol encountered no resistance, said Lt. Col. Rumi Nielson-Green, a United States military spokeswoman at Bagram air base north of Kabul.

Nothing but normal patterns of life were observed,” Colonel Rumi said. She could not confirm reports that the Taliban was destroying bridges.

Hmm - no Talibs observed even though some Karzai surrogat says they are there?

So far the story as I could reconstruct it. I am sure we will hear more from Habibullah. That could be in an obituary or in some other context.

One thing is for sure. This fight against 'Taliban' has little to do with a group of lunatics or revolutionaries. It has a lot to do with tribal feuds, disenfranchised groups and fighting over some loot poor people have lost or found.

The western forces may be knowledgeable in these structures and use them for their purpose. Then, of course, you might also believe that the U.S. military was the power behind the prison brake.

I do have some doubt over that though. Are the 'western forces' really smarter about Afghani society structures than Afghani academics? Are they smarter than Afghani warlords and tribal chiefs who have lived fighting and surviving for 30 plus years? Na.

From an remarkable 2008 survey and report by a Canadian reporter on the grounds in Kandahar:

In a sample of ordinary insurgents, 42 fighters in Kandahar province were asked by The Globe and Mail to identify their own tribe, and the results point to a divide within the Taliban ranks: Only five named themselves as members of the three major tribes most closely associated with the government, suggesting that tribal animosity has become a factor that drives the recruitment of insurgents.
"This government is a family business," said a prominent Afghan aid worker in Kandahar. "The other tribes get angry when a few tribes have all the power."

That is what it is about to Afghans. That is what 'taliban' are about.

Now please explain how the 'west' will win that war.

Posted by b on June 17, 2008 at 04:51 PM | Permalink | Comments (18)

June 16, 2008

Oil Prices - Get Used To It.

The Saudis allegedly said they will produce more oil and promptly oil hits $140/barrel.

U.S. refiners don't want more Saudi Oil saying it is too pricy. If the journos were knowledgeable they would point out that U.S. refiners simply can not refine the sulphur heavy stuff the Saudis peddle as additional capacity.

This hapless UN idiot Ban Ki-moon was the one who brought the original message of increased Saudi oil production. Like usual, he has no idea of the real problems. He is now announcing even more of unusable Saudi spice. Is that in his job description?

Pat Lang thinks the Saudis are angry at the "west" and keep production down for that reason. Maybe that is part of the story, but I do not believe it is the main issue.

There is population growth on this planet - fed by and demanding oil.
There is too little additional supply possible for now to feed that demand.
There is too little refinery capacity to make use of marginal quality stuff.
There are too many conflicts in the producing areas to allow additional supply.
There is like always a lot of speculation that exacerbates price moves.

In short: Get used to it.

$250 a barrel by next June would be a slower increase in price than last years surge. 

That's a positive sign, isn't it?

Meanwhile many people will die because we covert food into gas.

Posted by b on June 16, 2008 at 03:11 PM | Permalink | Comments (29)

The "generous offer" to Iran

Big powers to offer Iran "generous" deal in atom row

The EU's top diplomat said he would hand Iran a generous offer on Saturday aimed at resolving a deepening dispute over its nuclear ambitions that has helped push up oil prices to record highs.
"I am traveling to Tehran to present a generous and comprehensive offer," [European Union foreign policy chief Javier Solana] said in a statement on Friday.

Thanks to the Tehran Times, we can now read the "generous" offer (slow link):

In order to seek a comprehensive, long-term and proper solution of the Iranian nuclear issue consistent with relevant UN Security Council resolutions and building further upon the proposal presented to Iran in June 2006, which remains on the table, the elements below are proposed as topics for negotiations between China, France, Germany, Iran, Russia, the United Kingdom, and the United States, joined by the High Representative of the European Union, as long as Iran verifiably suspends its enrichment-related and reprocessing activities, pursuant to OP 15 and OP’ 19(a) of UNSCR 1803. In the perspective of such negotiations, we also expect Iran to heed the requirements of the IJNSC and the IAEA. For their part, China, France, Germany, Russia, the United Kingdom, the United States and the European Union High Representative state their readiness:

  • to recognize Iran’s right to develop research, production and use of nuclear energy for peaceful purposes in conformity with its NPT obligations;
  • to treat Iran’s nuclear program in the same manner as that of any Non-nuclear Weapon State Party to the NPT once international confidence in the exclusively peaceful nature of Iran’s nuclear program is restored.

The "generous offer" is to recognize rights that Iran, as a member of the Non Proliferation Treaty, already has. As sweetener to the "generous offer" some fluffy material and immaterial promisses are added.

Some immaterial points are:

  • Support Iran in playing an important and constructive role in international affairs.
  • Promotion of dialogue and cooperation on non-proliferation, regional security and stabilization issues.

Ain't that "generous"?

The material points all have one common attribute. They do not include any prices:

  • Support for construction of LWR based on state-of-the-art technology.

Nice offer - but how much will those Light Water Reactors cost? That is of course still to be negotiated. The costs turn out to be prohibitive? Oh, too bad. But the offer to talk about them was really "generous".

This offer is exactly the same that was made two years ago. It is nothing but a public relation ploy to justify further sanctions, especially by the EU, against Teheran.

Solana will say: "See, we did give it a try." But that is incorrect. The offer contains nothing that is specific enough to be valuable. Most importantly it does not contain any security guarantees by the U.S.

Posted by b on June 16, 2008 at 01:17 AM | Permalink | Comments (5)

June 15, 2008

al-Sadr's Recent Moves

Muqtada al'Sadr took several surprising step with interesting implications.

  1. His movement will not take part in the provincial elections, but will support 'independent' candidates.
  2. He shut down the general Sadr army and announced a special closed group that will as its sole task attack the occupation forces.
  3. He tasked his movement to take care of social issues and do welfare.

His official reasoning for the first point:

"We don't want anybody to blame us or consider us part of this government while it is allowing the country to be under occupation," said Liwa Smeisim, head of the Sadr movement's political committee.

That is certainly good marketing, but there are other reasons too. Maliki had threatened to forbid all parties that have a militia (and are not, like the Badr army, a government militia). As a Sadr party would likely win in the provinces in the south, Maliki would just as likely try everything to prevent that. The best way to avoid that threat is to support some surrogates that Maliki can not easily reject.

It is anyway unclear if the elections will be held this fall or next spring or whenever. It is also still open if there will be closed lists, i.e. only party votes are possible without knowing the candidates, or open lists where people can vote for actual candidates. The leader of the election commission, a Kurd, has his own agenda in the fight over that and clearly prefers closed lists and elections as late as possible. Al-Sadr is right to expect to get disenfranchised in the election no matter what he does. Now he avoids the fight over that while winning points with the nationalist public.

Number two is smart too.

Several top aides to Sadr said they would not be involved with the new group and said they knew nothing about it. Garawie said the members would have classified names and that some of their military activities might not be publicized.

The so far open Sadr army was neither well trained nor disciplined. But if Sadr, as one of his people says, really has some companies of trained fighters near the class of Hizbullah, these are best to operate from the underground and not wasted in open battles. To emphasize attacks only on occupation forces is another cookie point on the nationalist sheet.

The third point is what made his, and his dead father's, movement great in the first place. Sadr taking care of welfare delegitimizes the government which neither has the ability nor the will to take care of its people. It also allows him to nurture his base and to keep credibility in the eyes of the people.

The Maliki followers and the rightwing U.S. commentators will see this as a retreat of a beaten Sadr movement and a win for their side. I disagree with that view. This is a sidestep move that avoids useless open near-term conflict and will give gains in the long-term.

Posted by b on June 15, 2008 at 02:13 PM | Permalink | Comments (6)

CIA, Khan and the Nuclear Weapon Designs

The task of this piece on the front page of today's Washington Post is to establish the believe that Iran has a nuclear weapon design.

An international smuggling ring that sold bomb-related parts to Libya, Iran and North Korea also managed to acquire blueprints for an advanced nuclear weapon, according to a draft report by a former top U.N. arms inspector that suggests the plans could have been shared secretly with any number of countries or rogue groups.

The drawings, discovered in 2006 on computers owned by Swiss businessmen, included essential details for building a compact nuclear device that could be fitted on a type of ballistic missile used by Iran and more than a dozen developing countries, the report states.

The Swiss 'businessmen', Friedrich Tinner and his two sons, are alleged to have sold several nuke related stuff to Lybia and other countries.

There is more to the Tinner story, but for now let me concentrate on the date. The WaPo says the laptop has been discovered in 2006. But Tinner was under CIA control at least since the 2003 bust of nuclear related stuff on board of the 'BBC China'.

The German magazine Der Spiegel had a big story about this in March 2006:

Two circumstances could prove to be Lerch's undoing: first, the fact that the German ship "BBC China" was intercepted in October 2003 carrying a cargo of containers filled with nuclear technology headed for Libya and, second, that the incident prompted a panicked Gadhafi to disclose the names of all those who had supplied the Libyans with material and expertise for their nuclear program.
The authorities caught up with Gotthard Lerch, who Tahir calls his "main contractor," in Switzerland. They also arrested members of the Tinner family -- Friedrich Tinner and his two sons, Urs and Marco -- all on the suspicion of having built parts for Gadhafi's nuclear weapons program in return for 15 to 20 million Swiss francs.

Tinner was flipped by the CIA at least since the 'BBC China' event but likely even earlier. Another man taking part in the alleged smuggling was also turned by the CIA or has worked for the CIA all along.

Indeed it somehow seems like everybody involved in the issue was somehow related to the CIA.

The usual story is that the Pakistani scientist A.Q. Kahn was the one who ran a smuggling network. That may not be true at all. Khan denies having been involved in such. A new book asserts that it was then Prime Minister of Pakistan Bhutto who personally gave Pakistani nuclear secrets to North Korea in exchange for North Korean No Dong missiles for the Pakistani army.

A Dutch court somehow 'lost' legal files about the Khan case and the CIA likely had a hand in this too. The CIA also successfully pressed (link in German) the Swiss government to destroy information it had about the Tinner case. Tinner will thereby never be convicted.

Now please explain to me how people arrested in 2003 and flipped by the CIA at least since then managed to keep nuclear plans on a laptop that were somehow found only in 2006?

This whole story stinks from A to Z and no one should assume that anything put out about the issue by David Albright and WaPo is somewhat the truth. The whole 'Khan network' stuff, including some of the reports about it, are part of an intelligence operation.

Indeed as Der Spiegel wrote:

It is becoming increasingly clear that the CIA and Britain's MI6 infiltrated the Khan network and that they probably even recruited some of the main suspects. How else, for example, could one explain the fact that vacuum pumps manufactured by Germany's Pfeiffer Vacuum, ended up in both Libya and Iran? The company, after all, never sent any vacuum pumps to Libya or Iran -- but did send some to the US nuclear weapons research facility in Los Alamos, New Mexico.

Also why would Khan peddle German vacuum pumps to other countries when his peronal company's main export product were vacuum pumps made in Pakistan?

By now I come to believe that the 'Khan network', if it ever existed as such at all, was throroughly penetrated as early as 1990. Iran may or may not have the design for a warhead. But if such design plans came through the 'Khan network', i.e. Tenner and others, they are likely to have U.S. fingerprints all over them.

Posted by b on June 15, 2008 at 09:44 AM | Permalink | Comments (11)

June 13, 2008

Liberty vs. Secruity - Dimensions Vary

Picking up from Tangerine's comment:

In the Supreme Court decision on Boumediene vs. Bush (pdf, 134 pages) the majority opines (page 78):

The laws and Constitution are designed to survive, and remain in force, in extraordinary times. Liberty and security can be reconciled; and in our system they are reconciled within the framework of the law.

Tangerine mocks the words I highlighted:

The opposition between liberty and security is in any case a false one and rests on the presuppositiion that being submissive to jackboots is for one’s own (the nation's!) good. The law can either accept this nonsense, or refute it. Here it is openly accepted

Well - no. There is opposition between liberty and security. It is not "in any case a false one".

Do I have the liberty to spend all money I earn now, or some guarantees of a social security program that will repay in my old age?

Do I have the liberty to drive as fast as possible wherever I am, or some security to cross the road unharmed that comes with speed limits in midtown?

It is not deniable that, in a general sense, there is usually some payoff between liberty and security and I believe that Scotus, in the closing words of a long important opinion, is refering to that general sense.

The whole war-of-terror scheme is not a liberty vs. security question with the law being the judge. It rests on a different goal. It emphasises insecurity, makes up threats to security, to justify taking away of liberties and security.

Usually the liberty vs. security balance is seen along a line of positive choices.

To the left-top is security and to the right bottom is liberty. A social group entity, a free nation, can find its balance position somewhere along the green line and put that into law. You can gain a bit of liberty by giving up a bit of security.

But the 'new reality' the Bush/Cheney neocons introduced is different. They widened the 'playing field'. The real intent is now neither security nor liberty determined in some democratic balance but control - along the way of the black arrow. This is a new dimension they introduced and we have to consider. They have moved the realm of public discussion.

The II quadrant at the upper right with the green line is the one we are supposed to live in. Quadrant I is a benevolent dictatorship - lots of security but little liberty. Quadrant III is a revolutionary anarchy - lots of liberties, but anyone may shoot you right now, IV is pure fascism.

There you may choose between keeping your mouth totally shut and still be on the no fly list, or to argue pure scientific facts, i.e. be neutral in liberty, and still getting fired or jailed for daring to do so.

Bush/Cheney have moved the U.S. discussion space from the green line towards the brown line. There are still choices, positions along that brown line, but the line has moved.

The Scotus decision is trying to pull the nation back from the brown line to the green one. Liberty and security can be reconciled if the line is in the right quadrant.


Posted by b on June 13, 2008 at 04:11 PM | Permalink | Comments (21)

A Thanks to the Irish

Unlike Debs is dead predicted the Irish today voted against the European Lisbon treaties. Thanks folks!

Wikipedia has a bit on the history of the Treaty establishing a Constitution for Europe, shorter, the constitution.

The central point of the issue is a reform of the decision making process within the European Union. Today every head of state within the EU can block EU decisions. While I believe this to be a good solution, others believe that this hinders progress. (Haven't we progressed under the old rules too?)

But the constitution also did many other things. It was not a simple understandable paper of principles and rules, but a 500 page mashup that touched on every issue and speciality one can think of. That, in my view, was the real mistake the people who thought it up have made.

To stand behind it people have to understand and to accept a constitution. Having a bit of education on constitutional law, I read the proposed one, tried to understand it and failed. But maybe I am the dumbest person in Europe.

The constitution was rejected by voters in the Netherlands and in France. Voters in other countries were not asked, but their parliaments voted on it.

The politicians then found a way to circumvent the will of the people. They split the proposed constitution into two papers, the 'Lisbon treaties' and pushed these through their parliaments. Only Ireland allowed its people a direct vote on the issue.

Thankfully the Irish rejected it.

Now the trickery will start anew. Some politicians already speak of giving Ireland a 'special status' and keep the treaties for the rest of the EU.

A better solution would be to stop this project for now and start anew:

  • Define the fields a constitution will touch on, like how a European government is elected, how the European court is seated, the rights of the European parliament.
  • Develop alternative solutions for each field.
  • Let all people in the EU vote for the alternatives they like best.
  • Put the selected alternatives together into one constitution.
  • Let everybody vote on this final paper.

Posted by b on June 13, 2008 at 10:06 AM | Permalink | Comments (21)

June 12, 2008

Scalia et al: We Fear Because Bush Told Us To Fear

Circular reasoning:

Supporting a premise with the premise rather than a conclusion.

SUPREME COURT OF THE UNITED STATES - Nos. 06–1195 and 06–1196

JUSTICE SCALIA, with whom THE CHIEF JUSTICE, JUSTICE THOMAS, and JUSTICE ALITO join, dissenting (pdf, page 110ff):

America is at war with radical Islamists. The enemy began by killing Americans and American allies abroad: ..
It has threatened further attacks against our homeland; one need only walk about buttressed and barricaded Washington, or board a plane anywhere in the country, to know that the threat is a serious one.

Shorter example:
Because the President says we have to fear, we do fear.

Why are such idiots allowed to judge?

Posted by b on June 12, 2008 at 02:58 PM | Permalink | Comments (16)

A Good Reason to Vote

Good news with an ugly headline:

High Court sides with Guantanamo detainees again

This has nothing to do with taking sides. What the headline should have said is:

Supreme Court upholds rule of law


Supreme Court upholds constitution

The Supreme Court ruled Thursday that foreign terrorism suspects held at Guantanamo Bay have rights under the Constitution to challenge their detention in U.S. civilian courts.

In its third rebuke of the Bush administration's treatment of prisoners, the court ruled 5-4 that the government is violating the rights of prisoners being held indefinitely and without charges at the U.S. naval base in Cuba. The court's liberal justices were in the majority.
The court said not only that the detainees have rights under the Constitution, but that the system the administration has put in place to classify them as enemy combatants and review those decisions is inadequate.

This is the reason why the U.S. elections are so important. I do not really like Obama's policy proposals. But the danger of another wingnut judge replacing one of the moderate 'liberals' is just too big. This is the good reason to urge anyone who can to vote for him.

Posted by b on June 12, 2008 at 11:59 AM | Permalink | Comments (1)

This Propaganda Video Proves Nothing

The US-led coalition in Afghanistan on Thursday deflected accusations that it killed 11 Pakistani soldiers in an air strike, releasing video footage which it says shows its forces targeting insurgents.

"Deflect accusations ..." Hmmm - AFP describes the video:

The video footage, taken by an unmanned drone, shows a first strike targeted at men hiding behind a rock, and three subsequent attacks on men seeking cover in a ravine.

"It is clear there are no structures or (Pakistani) outposts in the impact area," a voice says off-camera.

The video shows a total of four strikes. Now what is that supposed to deflect?

As WaPo reports the strikes:

U.S.-led forces dropped more than a dozen bombs in and near Pakistan's tribal regions Wednesday ..
According to the U.S. military, two Air Force F-15E jets and a B-1B Lancer bomber then dropped the bombs, which included both precision-guided and unguided munitions and which weighed between 500 and 2,000 pounds. The bombs were used "to destroy anti-coalition members in the open and in buildings in the vicinity of Asadabad," Afghanistan, according to a statement released by the U.S. military's Combined Air and Space Operations Center for Southwest Asia.
"This a complex attack involving . . . an airstrike and artillery and a number of forces . . . along a border that has traditionally been a problem and is often the cause of some confusion as to who the forces are that are involved," [Pentagon press secretary] Morrell said.

The video shows four precious strikes involving no structures.

But the military also used artillery and it dropped more than 12 bombs, guided and unguided once, including some hitting buildings. So what is this video supposed to prove?


But the media nevertheless will use it to explain how innocent the military is in this. They also will be outraged when the Pashtun and Pakistani will eventually hit back.

Posted by b on June 12, 2008 at 09:20 AM | Permalink | Comments (5)

June 11, 2008

OT 08-22

News & views ...

We welcome your comments.

Posted by b on June 11, 2008 at 02:06 PM | Permalink | Comments (119)

The Dollar Abuse Leads To A Multipolar World

Since World War II the U.S. has abused the status of the dollar as the world currency to live beyond its means. It has forced others to finance its wars by exporting inflation. This was done after the Vietnam war and today the U.S. is trying to do it again and to let the world pay for its War on Iraq.

As a defensive measure against abuses like after Vietnam european countries established their common currency. Today, as the U.S. tries to repeat its old trick, the defense gets tested and it seems to be working fine.

After World War II and the decline of the British Empire the U.S. became the leading economic power of the world. The Bretton Woods agreement fixed world currencies to the U.S. dollar and the U.S. dollar to gold. But soon the U.S. economy declined relatively to the western European and the Japanese economies.

President Johnson decided not to increase taxes to pay for the Vietnam War and his Great Society program. Instead the Fed printed more dollars. The war led to an outflow of these dollars, high inflation and a deterioration of the U.S. balance of trade position. The peg of the dollar to gold at $35/once became untenable.

In 1971 Nixon broke the Bretton Woods agreement and took the dollar off the gold standard. The important international currencies went into free float and the dollar declined. The OPEC oil cartel, which sold its product in dollars, replied to this loss of revenue with hefty price increases. This 'oil shock' increased the already rampant inflation while the U.S. went into a recession.  Despite the high inflation the Fed reduced interest rates to revive the U.S. economy.

European and the Japanese economies depended on exports into a dollar denominated world market. With their currencies rising against the dollar their export products became more expensive. At the same time the higher inflation due to oil prices demanded an interest rate increase.

But with interest rates lower in the U.S. than in most European countries money flowed into their currencies and the dollar threatened to decline further. Their export economies were in danger of collapse. They had to follow the Fed and also decrease their interest rates. As a consequence stagflation set in on both sides of the Atlantic.

As an answer to this effective export of U.S. stagflation to their economies the European Community decided in 1975 to launch the European Currency Unit ECU. This was the birth of the Euro.

Paul Volker's harsh interest increases, lower demand for oil and increased supply of OPEC independent energy sources killed off inflation (and cost Carter a second term). Reagan's debt financed tax stimulus revived the U.S. economy.

President Bush decided not to increase taxes to pay for the War on Iraq and his other programs. Instead the Fed printed more dollars. The war led to an outflow of these dollars, high inflation and a deterioration of the U.S. balance of trade position.

The important international currencies were in free float and the dollar declined. The OPEC oil cartel, which sells its product in dollars, replied to this loss of revenue with hefty price increases. The 'oil shock' increased the already rampant inflation while the U.S. went into a recession. Despite the inflation the Fed reduced interest rates to revive the U.S. economy.

But one thing has changed between the 1970s and 2000: There is now an alternative to the dollar as world exchange medium.

Most of Europeans exports are no longer denominated in U.S. dollar but in euros. Many countries have diversified their reserves away from the dollar and into euros and yen. The dependence of world trade on the U.S. dollar has declined. At the same time U.S. dependency on imports has increased.

While the U.S. in the 1970s could effordless export its inflation and recession to Europe and Japan it is now meeting hard resistance.

Bernanke would like to lower interest rates further to get the U.S. out of the recession and to inflate away the nation's debt. But he can not do so because this time the Europeans will not follow him but will increase their interest rates and fight inflation.

As Wolfgang Münchau explained in the Financial Times:

By moving in the opposite direction from the Fed, the ECB is providing a much more appropriate domestic policy response than what would have been possible under a national currency regime. The ability to do this constitutes quite possibly one of the biggest economic benefits of the euro.   It has not only domestic but global implications. In particular, it limits the Fed’s own room for manoeuvre, something that would have been unthinkable only a few years ago. If the Europeans had followed the Americans again, the Fed would probably have been in a position to cut interest rates further. The dollar would not have fallen as much and Ben Bernanke, Fed chairman, would not have needed to revert to verbal intervention to prop up the dollar as he did last week. This suggests that in terms of global monetary policy, we are in the middle of a shift from a unipolar to a bipolar world.
As US inflation rises, more and more countries may unpeg from the dollar to avoid imported inflation. If this trend persisted, the US would risk losing its exorbitant privilege – the ability to live beyond its means thanks to a globally domineering currency.

The leading country of the world can not lead anymore. We may now also see the end of the Anglo-Saxon financial model:

Continental Europe should take the lead in devising new rules for financial markets because the Anglo-Saxon model of regulation has failed, Angela Merkel has told the Financial Times.
The chancellor praised the euro as having allowed the economy of the EU to partially decouple from the US, at least in the industrial goods area if not in financial markets, and reaffirmed her support for the independence of the European Central Bank.

The euro-countries are now able to withstand U.S. inflation export. But the devaluation of the dollar still exports U.S. inflation to those economies that are still pegged to the dollar. As less they are pegged and more independent they are from the dollar, the better is their control over imported inflation.

The Gulf States, pegged to the U.S. dollar, now all have between 15 and 25% inflation. China is using drastic measures, increasing mandatory bank reserves to 17.5%, to reign in double digit inflation. Smaller currencies with a dollar peg like the Ukraine's hryvnia are inflating at a 30% rate.

The U.S. is making these countries pay for its war on Iraq by exporting inflation to them. The euro model shows that alternatives are possible.

This success of the euro will reinforce the moves towards currency unions in Asia, South America and the Gulf region. The ASEAN+3 group is developing an Asian Currency Unit which replicates the ECU model. The Gulf countries are in talks of launching a common currency of their own by 2010. The Bank of the South is working on a similar model for Latin America.

The future world will be multipolar with five to six currency blocks which will have about equal weight. When those currency blocks are established, the U.S. dollar will have lost its special position. With that the U.S. will have lost its special place in the world and the luxury to let others pay for its wars and consumption.

Posted by b on June 11, 2008 at 01:48 PM | Permalink | Comments (12)

Silly Season and Other News

Some issues in today's news. Obviously the silly season has started.

In today's most degenerated op-eds the flatman muses about Arab reactions to Obama's "Muslim heritage" and Maureen Dowd warns of attacks on Obama's wife from the right while helpfully listing all attack lines, including the debunked "whitey" quote, and the links to the relevant hate sites.

Some excellent reviews, one even by Putin, the President of Germany, of the Father's Day McCain Golf Pack the McCain's campaign is selling for some cheap fifty bucks.

How do gag orders work in the U.S.?

A BBC investigation estimates that around $23bn (£11.75bn) may have been lost, stolen or just not properly accounted for in Iraq.
A US gagging order is preventing discussion of the allegations.

The order applies to 70 court cases against some of the top US companies.

The head of Gazprom, the Russian energy giant, says the price of oil will double "in the foreseeable future."

The IDF kills a 9 year old Palestinian girl and several "gunmen" and U.S. troops off four Afghan civilians, including a boy and two women.

Kucinich reads impeachment articles into the congressional record. A stunt which will of course lead nowhere. But let me ask Mr. Kucinich: What is in your 35 articles that has not be known for years? Why then are you doing this only now as time is too short for impeachment proceedings?

Posted by b on June 11, 2008 at 05:52 AM | Permalink | Comments (31)

June 10, 2008

Dollar Peg Good, Dollar Peg Bad

Why are Saudi Arabia and other Gulf countries urged to keep their currencies pegged to the U.S. dollar while China is chided for being too slow in abandoning their managed peg?

In early June Secretary of the Treasury Paulson visited several Gulf countries:

U.S. Treasury Secretary Henry Paulson and Saudi Arabian Finance Minister Ibrahim Al-Assaf agreed that the Gulf kingdom benefits from keeping its currency pegged to the dollar.

The riyal's peg "has served this country and the region well," Paulson said today at a joint press conference in Jeddah. "I totally agree with Secretary Paulson," al-Assaf said. "As we have said many times, we have no intention of de- pegging or of revaluation."

Paulson is getting an update on the fixed exchange rates retained by most oil-rich nations in the Middle East on his four-day trip to the region.
Any change to currency regimes in the region "is a sovereign decision," Paulson said.

But just a few days later Paulson says this:

Despite rising nearly 20 pct against the dollar in the last 3 years, China's yuan needs to appreciate even more -- and even more quickly -- if China is going to successfully deal with its growing economic imbalances, Treasury Secretary Henry Paulson said Tuesday.

So the Gulf shall stick to it the dollar and China shall not. Does this make any sense?

It can not be the trade deficit that is Paulson's problem here. That again increased last month against both, the Gulf states and China.

Both, the Gulf countries and China, have exactly the same monetary characteristic versus the U.S.

They export their goods to the U.S. and recycle the dollars they get by buying treasuries and other U.S. assets. In both cases it is a vendor financed deal that will stop when the vendor owns all the assets the buyer has. The U.S. people put themselves up for a garage sale.

The Gulf and China both have trouble with this as the scheme increases local inflation into the 10-20% range. Wal Mart pays a Chinese company in dollars. The company goes to Chinas central bank and exchanges the dollars for freshly created yuans to pay its workers. The increased yuan money supply heats Chinese local inflation. The same mechanism applies in the Gulf countries.

So why does Paulson think that a peg is good for the Gulf and bad for China?

Posted by b on June 10, 2008 at 02:27 PM | Permalink | Comments (10)

Diplomacy, lack of


1 : the art and practice of conducting negotiations between nations
2 : skill in handling affairs without arousing hostility : tact

diplomacy, lack of

"We hope that Koreans will begin to learn more about the science and about the facts of American beef and that this issue can be addressed constructively," [U.S. Ambassador to South Korea Alexander] Vershbow said.

Posted by b on June 10, 2008 at 10:54 AM | Permalink | Comments (4)

Treaty of Lisbon - The Absentee Landlords Return

by Debs is dead
excerpted from
a comment

The Treaty of Lisbon seems to be a naked grab for power by the already meglomaniacal european pols and technocrats who figure pushing this through in europe will be easy after a win in Ireland which is claimed to be the EU's greatest success story.

A rags to riches tale of neo-liberal alliances with corrupt pols exploiting a too trusting public who imagined that 'the boys' (their elected representatives) were still looking out for them while they had a couple of 'small drinks' on the side.

Those Irish pols must be desperate to remove a chunk of political power from the electorate before the shit hits the fan. That is before much of Ireland's new found wealth disappears down the gurgler, leaving the Irish people searching for culprits. The disadvantages of trans-national financial entanglements become revealed when the reality of being in hock to a plethora of foreign financiers takes shape.

If much of Ireland's power has been handballed to 'europe' then the local pols can blame them and say they would love to help but 'you people' went and voted our ability to do much across to Brussels.

In the meantime as Harry Browne explains the threat of economic doom and gloom arising from the 'no' vote getting up, is being used by these same pols to bludgeon the electorate into voting 'yes'.

As a fatalistic Celt myself, I can't but feel that the worst of both worlds will come to pass. That is the yes vote will win by a narrow margin and then Ireland's miracle will fade away completely to become another story to be passed on to future generations like all the other 'when we were once great' tales which sustain the ethos of being Irish no matter how many generations ago it was anyone from yer family set foot in the place.

Leaving the Irish as powerless to deal with the underlying issues which oppress their population as they were before they kicked out the english. Imperialism has a different face is all.

As a globalist at heart, but before anyone reels back in horror I should say I prefer the Internationalist label. Like the Wobblies of old, I have always believed the breaking down of national borders is a vital step towards global peace.

Of course at the same time as that happens major decison-making powers have to be brought down to community level so that individual communities can make the laws fit their needs.
The globalism practised by neo-libs is the reverse of that, borders are maintained while real political power is moved further and further away from the people and consolidated in the hands of distant elites. The absentee landlords return.

It is going to take a lot of blood split to get back those powers which were given away with a tick on a ballot paper. I used to think that would take a couple of generations to develop, but the beneficiaries of this consolidation of power have been too greedy, too fast.

The uprising around our planet as ordinary people express their anger at the 300% increase in basic food prices in 12 months may provide an opportunity to reverse this power shift before the elites have time to consolidate their new armies, or rather the militarised police forces who unlike traditional police are recruited because they have no ties to the communities they are to police.

Who needs criminal informants when you have CCTV on every lamp post and unlimited powers to intercept private communications? This is particularly true in Europe where the GWOT has provided the leadership with the perfect excuse to militarise what was meant to be a peaceful trading co-operative.

Posted by b on June 10, 2008 at 07:46 AM | Permalink | Comments (6)

June 09, 2008

The Deep State Is Back in Action

Several Turkish prime ministers tried to eliminate the Deep State. An informal, hard right-wing, secularist group composed of military and intelligence officers, judges, corporatists and organized crime groups.

The Deep State was part of NATO's Operation Gladio during the cold war and, applying a strategy of tension, was responsible for the killing of several thousand people. Several military coups de état were done under its directions.

It is back in action:

An entity established by a former military general has been working to influence the political and social atmosphere in Turkey, the Taraf daily reported in its weekend editions.

Called the Republican Work Group (CÇG), the organization is similar to the Western Work Group, which was known to be active in most of the events that led up to the unarmed military intervention of Feb. 28, 1997 that overthrew the government.

The Deep State, of which the CÇG is the silent lobbying part, is alleged to have prepared another coup in 2004 when the AK Party won local elections. But the plotters were not put on trial. Instead the editor of the magazine that published proof in form of a diary of one of the plotting generals was investigated and the magazine temporarily shut down.

The reappearance of the group points to new activities and is seen as the direct threat to the government.

The mildly Islamic AKP of Prime Minister Erdogan is already in trouble. It passed a constitutional amendment to allow for headscarves to be worn in universities. The Turkish Constitutional Court, in a 9 to 2 vote, declared the amendment unconstitutional and a "threat" to the country's secular order.

With this vote the court put itself firmly into the Deep State camp of the conflict and against the popular government. Additionally public prosecutors are trying to ban the AKP.

The party won 48% of the popular vote in the last election and it is ruling quite successfully. It is now considering another snap election to confirm that it has the support of the people.

While the Deep State is secular and nominally liberal, it is also rightwing and anti-democratic. Internationally it has support from the neocon AEI and Israel. AEI's Michael Rubin a few day's ago called Erdogan Turkey's Putin and demanded his prosecution. 

A coup against Erdogan, with guns or by partisan judges, would likely lead to a radicalisation of the followers of his party.

That again would heat up the cauldron in the Middle East by several hundred degrees.

Posted by b on June 9, 2008 at 12:39 PM | Permalink | Comments (6)

Conservatives Rue McCain Nomination

Panic is creeping up in the Republican camp.

Neo-con Kristol in the NYT comments:

[McCain] read a disjointed set of remarks at a badly staged rally at the Pontchartrain Center in Kenner, La. Here’s part of an e-mail message I received as McCain spoke, from a Republican who admires him: “They could have done so well tonight, shown a tone of confidence. Instead it looks like a bad Congressional race: dumb green puke background, small crowd ... Makes me want to cry.”

From the ground in Ohio LA Times reports:

If McCain tried to gather his volunteers in Ohio, "you could meet in a phone booth," said radio host Bill Cunningham, who attacks the Arizona senator regularly on his talk show. "There's no sense in this part of Ohio that John McCain is a conservative or that his election would have a material benefit to conservatism."

Novak opines in WaPo:

The evangelicals are not an isolated problem for the Arizona senator. Enthusiasm for McCain inside the Republican coalition is in short supply. During the four months since McCain clinched the nomination, he has not satisfied conservatives opposed to his positions on global warming, campaign finance reform, immigration, domestic oil drilling and how to ban same-sex marriages.

There will be more of such reports and voices. The false 'maverick' image that made McCain a media darling and gave him the primary votes is now hurting him with the ultra conservatives.

It will not keep all of them away from the polls though.

If McCain runs a positive campaign, arguing the conservative causes, they will not believe him. So instead  McCain must and will run a campaign that instigates 'fear of worse'. That will motivate many conservatives to hold their nose and give him their vote in hope of preventing a Democratic presidency.

But others will also choose the libertarian alternative to the right of McCain. Some will stay at home. The total will not be enough.

For now the conservative coalition puzzle in the U.S. seems to have fallen apart. McCain is not the person who can put the pieces back together.

As this slowly sinks into the party's mind, some elders may start to acknowledge the necessity of an intervention by some 'higher force' before the convention opens.

Posted by b on June 9, 2008 at 04:24 AM | Permalink | Comments (12)

June 08, 2008

The Pentagon Does It All

The usually very well informed Swoop writes:

The next round of US-China Strategic Economic Dialogue taking place from June 17th-18th will air new concerns about China’s currency policy. At the same time attitudes in the Pentagon are hardening. At a speech in Singapore on May 31st Secretary of Defense Gates sharply criticized Chinese policy in the South China Sea. We understand he did this despite objections from the State Department. Further, the Pentagon has established what may be described as a “dirty tricks” unit charged with developing ideas for disrupting China. We do not believe that the White House has authorized any of these activities – which remain in the planning phase. But these indications point toward greater tension in US-China relations.

In the key judgement it adds:

However, the aftermath of the speech may have heightened tensions, with a senior Chinese general attacking US bilateral alliance relationships and missile defense policies as “undercutting the equilibrium of regional powers.” This has only boosted the Pentagon’s suspicions. A senior Pentagon officer told us “the Chinese have no idea how we can hurt them. We have not started yet.” Plans to encourage greater pliancy, we were told, include encouraging overseas Chinese to pull their investments out of the mainland.

Of course this is brain dead policy. There is absolutely no need for the U.S. to see China as a threat.

The real purpose of such politics is to put more taxpayer money into useless military super gadgets like the F-22 fighter. There is hardly any justification for the plane at all, but the Air Force and Lockheed want more. Therefore they invent a China threat.

The danger is that such stuff might eventually be used just because it is there. UN ambassador Madeleine Albright once asked then Chairman of the Joint Chiefs of Staff Colin Powell, "What's the point of having this superb military you're always talking about if we can't use it?"

But an even bigger danger here is the role of the Pentagon as displayed above.

  • Gates talking against China despite objections from the State Departments. The Pentagon should be a tool of foreign policy, not the foreign policy maker.
  • The military planning "dirty tricks". That is definitely not the task of the military but the job of the CIA and other civil clandestine services.
  • A senior Pentagon officer talking about economic warfare issues like coerced divestment. Such measures are the job of the treasury.
  • All the above measures should be planed and coordinated by the National Security Council, not by the Pentagon.

Having multiple bureaucracies and power centers within a government is a feature, not a bug. It helps to avoid one sided, single minded decisions.

The trend over the years has been to put ever more tasks into the Pentagon or rather, the Pentagon robbing these roles from other agencies without any resistance from above. It is now playing NSC, State, Treasury and CIA on top of its original job.

Everybody should fear the future state this will lead to.

Posted by b on June 8, 2008 at 12:57 PM | Permalink | Comments (17)

Flatman Strikes Again

Thomas L. Flatman writes:

Israel’s economic and military power today is entirely dependent on extracting intelligence from its people. Israel’s economic power is endlessly renewable.

Thanks Thomas! Now please explain this to the U.S. taxpayers:

JERUSALEM (AFP) — The United States signed a deal on Thursday to boost its military aid to Israel to 30 billion dollars over the next decade aimed at countering a "resurgent" Iran and its allies.

Posted by b on June 8, 2008 at 11:18 AM | Permalink | Comments (9)

Nationalist Development in Iraq

I will stop beating the NYT when it stops lousy reporting.

Today the 'grey lady'  tells us that a: Ex-Premier Is Expelled From Governing Party in Iraq

BAGHDAD - In a shakeup at the top of Iraq’s Shiite power structure, former Prime Minister Ibrahim al-Jaafari was expelled from the governing Dawa political party, officials said Saturday.

Dr. Jaafari, a physician who was an Iraqi exile leader for decades before returning in 2003 to serve as prime minister, was expelled for creating a political movement that had opened talks with rivals of Dawa’s leader, Prime Minister Nuri Kamal al-Maliki, a senior party member, Haider al-Abadi, said in a telephone interview.

First issue: It is ridiculous to have as only source for this a selfserving Maliki mouthpiece in a telephone interview when the byline suggests the report is from Baghdad.

Second issue: Jaafari is at least since a week ago no longer member of Dawa. He was not 'expelled' but walked away from it.

The developments come as Ibrahim al-Jaafari, a former prime minister, launches a new political party, National Reform.

The party will take part in the next provincial elections under a separate list from the Dawa party, al-Jaafari said on Saturday.

Third issue: Jaafari did not only "open talks" with others, but these talks were finished two days ago.

Jaafari and his coalition now have 90 nationalist votes in the parliament. That is a serious challenge to Maliki and his overlords in Washington and Teheran.

Posted by b on June 8, 2008 at 09:25 AM | Permalink | Comments (0)

June 07, 2008

NYT Changes Reasoning For Recent Oil Rise

Oil prices had their biggest gains ever on Friday, jumping nearly $11 to a new record above $138 a barrel, after a senior Israeli politician raised the specter of an attack on Iran and the dollar fell sharply against the euro.

Reasons given for the oil rise: A. Israel, B. Dollar

The above is how Laura Rozen and dozens of other people quote the first graph of a story in today's New York Times.

But when I read the piece under the same URL a bit later the sequence of the NYT's explanation for the rise of oil prices had changed.

The rise in oil prices turned into a stampede on Friday with futures jumping a staggering $11 a barrel to set a record above $138 a barrel. The unprecedented surge came as the dollar fell sharply against the euro and a senior Israeli politician once again raised the possibility of an attack against Iran.

Reasons now given for the oil rise: A. Dollar, B. Israel

It is not only the opening paragraph that changed.

The complete earlier version of the piece is still carried by the International Herald Tribune. It expands on the threat from Israel in the sixth paragraph and on the dollar fall in the ninth.

The later 'corrected' version at the NYT site expands on the dollar in the fifth paragraph and on a possible Israeli attack on Iran in the eighth.

Which version is factual more correct in its emphasis?

Yesterday the US dollar index fell by 0.93% from 73.066 to 72.390. Crude futures for August delivery went up by 7.8% from 128.13 to 138.16.

Is a less than 1% change in the U.S. dollar the prime explaining factor for a 7.8% rise in crude oil?

Or is a threat of another war on the second biggest OPEC producer by Israel's Deputy Prime Minister Shaul Mofaz the more important reason for the oil rise?

"If Iran continues with its programme for developing nuclear weapons, we will attack it. The sanctions are ineffective," said Mr Mofaz, referring to pressure by the United Nations security council to end Iran's disputed programme of uranium enrichment. "Attacking Iran, in order to stop its nuclear plans, will be unavoidable."

The answer seems obvious to me. The market freaked because of the war drums, not because of a slight dollar move.

So why did the NYT editor change the piece and preferred to cite the dollar fall as the primary explanation?

Posted by b on June 7, 2008 at 10:49 AM | Permalink | Comments (21)

June 06, 2008

Iraq-U.S. Deal - Money is not the Issue

The current discussions about the U.S.-Iraq Status of Force (SOFA) and Strategic Framework Agreement (SFA) are intensifying.

The parties in Iraq aligned with the government want, to one degree or another, modify the  U.S. written agreements, while the parties not aligned with the government want no such agreements at all.

Some believe the issue is money, while I believe that it is more than that.

Patrick Cockburn reports in today's Independent that the U.S. is using financial blackmail to get the agreements signed:

The US is holding hostage some $50bn (£25bn) of Iraq's money in the Federal Reserve Bank of New York to pressure the Iraqi government into signing an agreement seen by many Iraqis as prolonging the US occupation indefinitely, according to information leaked to The Independent.

US negotiators are using the existence of $20bn in outstanding court judgments against Iraq in the US, to pressure their Iraqi counterparts into accepting the terms of the military deal, details of which were reported for the first time in this newspaper yesterday.

Dr. iRack sees this differently. The Iraqi government, he says, does not want to sign the agreements with the U.S. because then the money would lose immunity:

The real issue is not about infringements on Iraqi sovereignty but a little known aspect of the UNSCRs related to the Development Fund for Iraq (DFI). The DFI (originally established by UNSCR 1483 in May 2003 as a replacement for Oil for Food) is composed of billions of dollars of revenue from oil exports and assets seized from Saddam Hussein. Under this arrangement, the DFI, intended for Iraqi reconstruction needs, is immune from claims made by creditors or others with legal claims (including pending and potential criminal lawsuits) against Saddam's regime. But, if the UNSCR goes away, so does this immunity, and all the money would be put at risk. As this reality has sunk in, the Iraqi leadership is freaked.

So while Cockburn sees the U.S. as using the funds for blackmail to get the agreement signed, Dr. iRack sees the funds current immunity as reason for the Iraqis not to sign.

In the comments he adds:

The DFI money is safer under the UNSCR. With a bilateral agreement, it is at the whim of an executive order--which can be changed by a new administration. So it would be odd for the Bush administration to threaten the Iraqi government with a worse deal than they could get under the UNSCR. That's not usually how threats work.

I have read through the relevant UN resolutions and, if these runs out by the end of this year, the money would be under sole control of the Iraqi Central Bank, but still held in an account at the U.S. Federal Reserve Bank.

The U.S., like other countries, has put these funds under immunity from lawsuits because the UN resolutions demanded such. If the resolutions run out, there certainly is the risk that the U.S. may take away the immunity and seize parts of the funds.

But to blackmail the Iraqi government with the stick of possible seizure, the agreements would have to provide as carrot a guarantee that such will not happen. I believe only Congress could give such a permanent assurance and Bush does not plan to let Congress near the issue.

Bush threatening to take the money away is a bluff.

The money, I think, is simply a sideshow. $20 billion might sound like a lot of money but for a resource rich country which exports 2 million barrel of oil per day at a price of $100/barrel it is a strategically neglectable amount.

If, at the end of the year, the UN resolution runs out, the U.S. forces in Iraq would be outside of international law with some possibly nasty legal consequences. The Iraqis are not in the weak position here.

The real issue are the big parts of the deal. The bases, the sovereignity of airspace and the immunity of U.S. forces and contractors.

So what will happen now?

The Iraqis will want to push the problem away until Bush is gone. Indeed the Washington Post today reports:

The Iraqi government may request an extension of the United Nations security mandate authorizing a U.S. military presence, due to expire in December, amid growing domestic criticism of new bilateral arrangements now being negotiated with the Bush administration, according to senior Iraqi officials.

The last time Iraqi parliament did not agree to such an extension of the UN resolution and, without a parliament vote, the UN Security Council may prevent another prolongation.

But if Maliki can tell the parliament that he will likely get a better deal next year, it might favor to go with it.

I do not see what the U.S. could do to prevent this. With a veto in the Security Council Bush would put the troops into legal limbo. The Iraqis could demand their immediate retreat.

That situation would be awkward.

Posted by b on June 6, 2008 at 12:21 PM | Permalink | Comments (13)

An Attack on Iran and U.S-Israel Relations

How would the public react to the consequences of an attack on Iran.

Here is a one scenario I can imagine but have not seen discussed in any analysis.

  • The public does not want an attack on Iran.
  • The public would see any attack on Iran by Israel and/or the U.S. to be launched for the sole benefit of Israel.
  • Any attack on Iran would double crude oil prices and gas in the U.S. would shot up to $8/gallon, guaranteeing a deep recession.
  • While the media would not point it out, the people would know who to blame for such prices and their consequences for the 'American way of life'.
  • Voters would demand from their representatives to distance themselves from Israel and pro-Israel funds.
  • Over a few years Israel would lose most U.S. financial, diplomatic and military support.

How plausible is this?

Have the U.S. administration or the Israeli government or the Iranian government made such calculations?

Posted by b on June 6, 2008 at 09:30 AM | Permalink | Comments (21)

June 05, 2008

A Napkin Plan for Regime Change in Iran

The Senate Intelligence Committee Report on pre-war intelligence on Iraq, is finally out.

The first part is a (big pdfs)

"Report on Whether Public Statements Regarding Iraq by U.S. Government officials Were Substantiated by Intelligence Information".

At first glance there is nothing new in there. Bush lied, people died.

The second part is a

"Report on Intelligence Activities Relating to Iraq Conducted by the Policy Counterterrorism Evaluation Group and the Office of Special Plans Within the Office of the Under Secretary of Defense for Policy"

and it has some interesting and funny stuff. For your amusement I excerpt some bits below.

In 2004 Josh Marshall, Laura Rozen and Paul Glastris wrote on Iran-Contra II? - Fresh scrutiny on a rogue Pentagon operation.

Their story was about secret meetings in 2002 in Rome and 2003 in Paris with Michael Ledeen, Department of Defense officials, the Iranian expat Ghorbanifar of Iran-Contra fame, some Iranian 'officials' and Italian intelligence officials. Ledeen was pushing schemes for regime change in Iran.

The new report describes whole affair in some detail. First the meeting in Rome and the attempts of Ledeen to get the U.S. government behind his plans.

Consider a bar, a napkin and $5 million for regime change as described on page 16 of the PDF. (Franklin and Rhode are DoD persons):

Mr. Franklin informed the Committee that during the trip in Rome Mr. Ghorbanifar pressed his own agenda for regime change in Iran. Mr. Franklin stated that late night during a discussion in a bar Mr. Ghorbanifar laid out his plan on a napkin. The plan involved simultaneous disruption of traffic at key intersections leading to Teheran that would create anxiety, work stoppages and other disruptive measures. Mr. Franklin recalled that Mr. Ghorbanifar asked for $5 million in seed money to facilitate the activity. He added that Mr. Ghorbanifar indicated that if the first action was successful additional money may be needed later but Mr. Franklin could not recall specific amounts being discussed beyond the $5 million. Mr. Rhode recalled Mr. Ghorbanifar discussing a plan to set up a network that would lead to the overthrow of the regime, but could not recall a specific dollar amount. Mr. Ledeen provided the Committee similar recollections, noting that Mr. Ghorbanifar offered a variety of different schemes for regime change in Iran dating to the time the two had first met. Mr. Ledeen added that he believed the U.S. Government should be supporting Iranians who want to overthrow the regime.

Other possible sources for money come up (page 16/17):

A synopsis of the discussion in Rome on Mr. Ghorbanifar’s plan, prepared by Mr. Rodman in mid-February 2002 with input from Mr. Franklin, stated that Mr. Ledeen and Mr. Ghorbanifar advised Mr. Franklin and Mr. Rhode of “the XXXXXXXXXXXX [foreign government] support for this information collection opportunity and financing by XXXXX [foreign] corporate enterprises midway through the interviews…..”

Who could that be? The Saudi government in person of Price Bandar offering black money pilfered from the Saudi-BAE weapons deal?

There follows some discussion between the State Department and the CIA, who both had been kept in the dark about the meeting, and the DoD. The CIA had marked Gharbanifar as not trustworthy for a long time.

Still Ledeen pushes on and, after intervention by Newt Gingrich, Rumsfeld's office gives orders to the Defense Human Intelligence Service to meet with Ledeen (p22):

Information provided by the DoD in March 2008 indicates that after the interview of Mr. Ledeen the Defense HUMINT Service held discussions with several components of the CIA, XXXXXXXXXXXXX. During the meeting, the Defense HUMINT Service learned that Mr. “Ledeen had a history of approaching the USG [U.S. Government] contacts with various ‘schemes’ to gain USG interest and/or support for various issues normally related to Hizbollah, Iran, and/or Terrorism.” The Service also became aware that some of Mr. Ledeen’s contacts were considered “nefarious and unreliable.” The Defense HUMINT Service determined that no further contact with Mr. Ledeen was warranted or advisable.

Smart folks. Next Ledeen goes to the Vice President (p23):

Mr. Franklin advised the Committee that he became aware of Mr. Ledeens’ efforts to push for other elements of the U.S. Government to hear Mr. Ghorbanifar’s plan. He recalls being approached by an official from the Office of the Vice President in early 2002 requesting his opinion of Mr. Ghorbanifar’s plan and his judgments of its prospect for success. Mr. Franklin stated that he recommended it not be pursued.

After the ambassador in Italy protest against Ledeen's plan for another meeting in Rome, Sec State Powell intervenes. Hadley finally gets upset that Ledeen continues to press for the scheme and the whole issue dies down.

Ledeen managed to get the top U.S. government, Hadley, Cheney, Rumsfeld, Powell and Tenet involved   to further a regime change plan for Iran scribbled one late night on a napkin in a bar in Rome.

Still he finds no takers for this attempt. But in 2003 he is back with a new plan. That will be stuff for a second post.

Posted by b on June 5, 2008 at 01:35 PM | Permalink | Comments (12)

Credit Crunch Continues

The next round of the credit crunch has started in earnest.

The rating agencies are downgrading the bond insurers MBIA and Ambac. This should have happened months ago. There triple-A rating was ridiculous. With the downgrading of the insurers, the bonds insured by these companies will also be downgraded immediately and thereby lose value.

That means another round of losses for the financial industry. The Lehman Brothers brokerage firm is in big trouble too. It is now looking for some white knight to infuse capital. More capital may help Lehman for a few weeks, but I would not bet one dollar on the company's long term survival.

Meanwhile the regulators are waking up a bit. There is a move by the Financial Accounting Standards Board (FASB) to change the rules for 'Special Purpose Vehicles'. Those are highly leveraged entities set up by banks to borrow short term money to buy long term bonds.

Today these entities do not show up on the balance sheets of the banks. They thereby do not count as risk and do not require additional reserve holdings. The total amount of money in such vehicles is estimated as $5,000 billion. If these have to be brought onto the books, the banks will either need much more capital or they will have to reduce their lending to others.

There is international political pressure for these rule changes and the banking lobby will not able to stop the issue. While a rule change would only be implemented in mid 2009, the effect on availability of credit will be immediate as the banks will have to prepare for the change.

The credit crunch is far from being over.

Without credit real econommy investment will continue to slow down.

Posted by b on June 5, 2008 at 11:19 AM | Permalink | Comments (14)

So much for Change

What to expect?

An administration ignoring and breaking international law, working against the possibility of peace in Palestine and selling out U.S. interests to the Likud party of Israel.

Jerusalem will remain the capital of Israel, and it must remain undivided.

So much for change ...

Posted by b on June 5, 2008 at 05:20 AM | Permalink | Comments (20)