onsdag den 24. december 2008

World Faces "Total" Financial Meltdown: Bank of Spain Chief

The governor of the Bank of Spain on Sunday issued a bleak assessment of the economic crisis, warning that the world faced a "total" financial meltdown unseen since the Great Depression.

"The lack of confidence is total," Miguel Angel Fernandez Ordonez said in an interview with Spain's El Pais daily.

"The inter-bank (lending) market is not functioning and this is generating vicious cycles: consumers are not consuming, businessmen are not taking on workers, investors are not investing and the banks are not lending.

"There is an almost total paralysis from which no-one is escaping," he said, adding that any recovery -- pencilled in by optimists for the end of 2009 and the start of 2010 -- could be delayed if confidence is not restored.

Ordonez recognised that falling oil prices and lower taxes could kick-start a faster-than-anticipated recovery, but warned that a deepening cycle of falling consumer demand, rising unemployment and an ongoing lending squeeze could not be ruled out.

"This is the worst financial crisis since the Great Depression" of 1929, he added.

Ordonez said the European Central Bank, of which he is a governing council member, would cut interest rates in January if inflation expectations went much below two percent.

"If, among other variables, we observe that inflation expectations go much below two percent, it's logical that we will lower rates."

Regarding the dire situation in the United States, Ordonez said he backed the decision by the US Federal Reserve to cut interest rates almost to zero in the face of profound deflation fears.

Central banks are seeking to jumpstart movements on crucial interbank money markets that froze after the US market for high-risk, or subprime mortgages collapsed in mid 2007, and locked tighter after the US investment bank Lehman Brothers declared bankruptcy in mid September.

Interbank markets are a key link in the chain which provides credit to businesses and households.


Copyright AFP 2008, AFP

TNI- Konference

Capitalist Fools - Joseph Stieglitz (nobelprisvinder i økonomi).

Capitalist Fools
December 16th, 2008 · No Comments
Joseph Stiglitz in Vanity Fair argues that in the debate over remaking financial policy, it is crucial to get the history right about the causes of the crisis. He puts the blame on five key decisions and moments: Reagan’s appointment of free market zealot Greenspan as Chair of the Federal Reserve, the repeal of Glass-Steagall act and other laws that increased de-regulation of the financial sector, Bush’s tax cuts for the rich and unprecedented low interest rates that encouraged excessive borrowing and lending, failure to tackle stock options or incentive structures for rating agencies which instead encouraged everyone to hide the real figures, and finally the misdirected actions of the Bush administration to the crisis that bailed out bankers and shareholders but not those facing foreclosures of their homes.

“There will come a moment when the most urgent threats posed by the credit crisis have eased and the larger task before us will be to chart a direction for the economic steps ahead. This will be a dangerous moment. Behind the debates over future policy is a debate over history - a debate over the causes of our current situation. The battle for the past will determine the battle for the present. So it’s crucial to get the history straight.

What were the critical decisions that led to the crisis? Mistakes were made at every fork in the road - we had what engineers call a “system failure,” when not a single decision but a cascade of decisions produce a tragic result. Let’s look at five key moments.
*No. 1: Firing the Chairman*

In 1987 the Reagan administration decided to remove Paul Volcker as chairman of the Federal Reserve Board and appoint Alan Greenspan in his place. Volcker had done what central bankers are supposed to do. On his watch, inflation had been brought down from more than 11 percent to under 4 percent. In the world of central banking, that should have earned him a grade of A+++ and assured his re-appointment. But Volcker also understood that financial markets need to be regulated. Reagan wanted someone who did not believe any such thing, and he found him in a devotee of the objectivist philosopher and free-market zealot Ayn Rand.

Greenspan played a double role. The Fed controls the money spigot, and in the early years of this decade, he turned it on full force. But the Fed is also a regulator. If you appoint an anti-regulator as your enforcer, you know what kind of enforcement you’ll get. A flood of liquidity combined with the failed levees of regulation proved disastrous.

Greenspan presided over not one but two financial bubbles. After the high-tech bubble popped, in 2000-2001, he helped inflate the housing bubble. The first responsibility of a central bank should be to maintain the stability of the financial system. If banks lend on the basis of artificially high asset prices, the result can be a meltdown - as we are seeing now, and as Greenspan should have known. He had many of the tools he needed to cope with the situation. To deal with the high-tech bubble, he could have increased margin requirements (the amount of cash people need to put down to buy stock). To deflate the housing bubble, he could have curbed predatory lending to low-income households and prohibited other insidious practices (the no-documentation - or “liar” - loans, the interest-only loans, and so on). This would have gone a long way toward protecting us. If he didn’t have the tools, he could have gone to Congress and asked for them.

Of course, the current problems with our financial system are not solely the result of bad lending. The banks have made mega-bets with one another through complicated instruments such as derivatives, credit-default swaps, and so forth. With these, one party pays another if certain events happen - for instance, if Bear Stearns goes bankrupt, or if the dollar soars. These instruments were originally created to help manage risk - but they can also be used to gamble. Thus, if you felt confident that the dollar was going to fall, you could make a big bet accordingly, and if the dollar indeed fell, your profits would soar. The problem is that, with this complicated intertwining of bets of great magnitude, no one could be sure of the financial position of anyone else - or even of one’s own position. Not surprisingly, the credit markets froze.

Here too Greenspan played a role. When I was chairman of the Council of Economic Advisers, during the Clinton administration, I served on a committee of all the major federal financial regulators, a group that included Greenspan and Treasury Secretary Robert Rubin. Even then, it was clear that derivatives posed a danger. We didn’t put it as memorably as Warren Buffett - who saw derivatives as “financial weapons of mass destruction” - but we took his point. And yet, for all the risk, the deregulators in charge of the financial system - at the Fed, at the Securities and Exchange Commission, and elsewhere - decided to do nothing, worried that any action might interfere with “innovation” in the financial system. But innovation, like “change,” has no inherent value. It can be bad (the “liar” loans are a good example) as well as good.

No. 2: Tearing Down the Walls

The deregulation philosophy would pay unwelcome dividends for years to come. In November 1999, Congress repealed the Glass-Steagall Act - the culmination of a $300 million lobbying effort by the banking and financial-services industries, and spearheaded in Congress by Senator Phil Gramm. Glass-Steagall had long separated commercial banks (which lend money) and investment banks (which organize the sale of bonds and equities); it had been enacted in the aftermath of the Great Depression and was meant to curb the excesses of that era, including grave conflicts of interest. For instance, without separation, if a company whose shares had been issued by an investment bank, with its strong endorsement, got into trouble, wouldn’t its commercial arm, if it had one, feel pressure to lend it money, perhaps unwisely? An ensuing spiral of bad judgment is not hard to foresee.

I had opposed repeal of Glass-Steagall. The proponents said, in effect, Trust us: we will create Chinese walls to make sure that the problems of the past do not recur. As an economist, I certainly possessed a healthy degree of trust, trust in the power of economic incentives to bend human behavior toward self-interest - toward short-term self-interest, at any rate, rather than Tocqueville’s “self interest rightly understood.”

The most important consequence of the repeal of Glass-Steagall was indirect - it lay in the way repeal changed an entire culture. Commercial banks are not supposed to be high-risk ventures; they are supposed to manage other people’s money very conservatively. It is with this understanding that the government agrees to pick up the tab should they fail. Investment banks, on the other hand, have traditionally managed rich people’s money - people who can take bigger risks in order to get bigger returns. When repeal of Glass-Steagall brought investment and commercial banks together, the investment-bank culture came out on top. There was a demand for the kind of high returns that could be obtained only through high leverage and big risktaking.

There were other important steps down the deregulatory path. One was the decision in April 2004 by the Securities and Exchange Commission, at a meeting attended by virtually no one and largely overlooked at the time, to allow big investment banks to increase their debt-to-capital ratio (from 12:1 to 30:1, or higher) so that they could buy more mortgage-backed securities, inflating the housing bubble in the process. In agreeing to this measure, the S.E.C. argued for the virtues of self-regulation: the peculiar notion that banks can effectively police themselves. Self-regulation is preposterous, as even Alan Greenspan now concedes, and as a practical matter it can’t, in any case, identify systemic risks - the kinds of risks that arise when, for instance, the models used by each of the banks to manage their portfolios tell all the banks to sell some security all at once.

As we stripped back the old regulations, we did nothing to address the new challenges posed by 21st-century markets. The most important challenge was that posed by derivatives. In 1998 the head of the Commodity Futures Trading Commission, Brooksley Born, had called for such regulation - a concern that took on urgency after the Fed, in that same year, engineered the bailout of Long-Term Capital Management, a hedge fund whose trillion-dollar-plus failure threatened global financial markets. But Secretary of the Treasury Robert Rubin, his deputy, Larry Summers, and Greenspan were adamant - and successful - in their opposition. Nothing was done.

No. 3: Applying the Leeches

Then along came the Bush tax cuts, enacted first on June 7, 2001, with a follow-on installment two years later. The president and his advisers seemed to believe that tax cuts, especially for upper-income Americans and corporations, were a cure-all for any economic disease - the modern-day equivalent of leeches. The tax cuts played a pivotal role in shaping the background conditions of the current crisis. Because they did very little to stimulate the economy, real stimulation was left to the Fed, which took up the task with unprecedented low-interest rates and liquidity.

The war in Iraq made matters worse, because it led to soaring oil prices. With America so dependent on oil imports, we had to spend several hundred billion more to purchase oil - money that otherwise would have been spent on American goods. Normally this would have led to an economic slowdown, as it had in the 1970s. But the Fed met the challenge in the most myopic way imaginable. The flood of liquidity made money readily available in mortgage markets, even to those who would normally not be able to borrow. And, yes, this succeeded in forestalling an economic downturn; America’s household saving rate plummeted to zero. But it should have been clear that we were living on borrowed money and borrowed time.

The cut in the tax rate on capital gains contributed to the crisis in another way. It was a decision that turned on values: those who speculated (read: gambled) and won were taxed more lightly than wage earners who simply worked hard. But more than that, the decision encouraged leveraging, because interest was tax-deductible. If, for instance, you borrowed a million to buy a home or took a $100,000 home-equity loan to buy stock, the interest would be fully deductible every year. Any capital gains you made were taxed lightly - and at some possibly remote day in the future. The Bush administration was providing an open invitation to excessive borrowing and lending - not that American consumers needed any more encouragement.

No. 4: Faking the Numbers

Meanwhile, on July 30, 2002, in the wake of a series of major scandals - notably the collapse of WorldCom and Enron - Congress passed the Sarbanes-Oxley Act. The scandals had involved every major American accounting firm, most of our banks, and some of our premier companies, and made it clear that we had serious problems with our accounting system. Accounting is a sleep-inducing topic for most people, but if you can’t have faith in a company’s numbers, then you can’t have faith in anything about a company at all.

Unfortunately, in the negotiations over what became Sarbanes-Oxley a decision was made not to deal with what many, including the respected former head of the S.E.C. Arthur Levitt, believed to be a fundamental underlying problem: stock options. Stock options have been defended as providing healthy incentives toward good management, but in fact they are “incentive pay” in name only. If a company does well, the C.E.O. gets great rewards in the form of stock options; if a company does poorly, the compensation is almost as substantial but is bestowed in other ways. This is bad enough. But a collateral problem with stock options is that they provide incentives for bad accounting: top management has every incentive to provide distorted information in order to pump up share prices.

The incentive structure of the rating agencies also proved perverse. Agencies such as Moody’s and Standard & Poor’s are paid by the very people they are supposed to grade. As a result, they’ve had every reason to give companies high ratings, in a financial version of what college professors know as grade inflation. The rating agencies, like the investment banks that were paying them, believed in financial alchemy - that F-rated toxic mortgages could be converted into products that were safe enough to be held by commercial banks and pension funds. We had seen this same failure of the rating agencies during the East Asia crisis of the 1990s: high ratings facilitated a rush of money into the region, and then a sudden reversal in the ratings brought devastation. But the financial overseers paid no attention.

No. 5: Letting It Bleed

The final turning point came with the passage of a bailout package on October 3, 2008 - that is, with the administration’s response to the crisis itself. We will be feeling the consequences for years to come. Both the administration and the Fed had long been driven by wishful thinking, hoping that the bad news was just a blip, and that a return to growth was just around the corner. As America’s banks faced collapse, the administration veered from one course of action to another. Some institutions (Bear Stearns, A.I.G., Fannie Mae, Freddie Mac) were bailed out. Lehman Brothers was not. Some shareholders got something back. Others did not.

The original proposal by Treasury Secretary Henry Paulson, a three-page document that would have provided $700 billion for the secretary to spend at his sole discretion, without oversight or judicial review, was an act of extraordinary arrogance. He sold the program as necessary to restore confidence. But it didn’t address the underlying reasons for the loss of confidence. The banks had made too many bad loans. There were big holes in their balance sheets. No one knew what was truth and what was fiction.

The bailout package was like a massive transfusion to a patient suffering from internal bleeding - and nothing was being done about the source of the problem, namely all those foreclosures. Valuable time was wasted as Paulson pushed his own plan, “cash for trash,” buying up the bad assets and putting the risk onto American taxpayers. When he finally abandoned it, providing banks with money they needed, he did it in a way that not only cheated America’s taxpayers but failed to ensure that the banks would use the money to restart lending. He even allowed the banks to pour out money to their shareholders as taxpayers were pouring money into the banks.

The other problem not addressed involved the looming weaknesses in the economy. The economy had been sustained by excessive borrowing. That game was up. As consumption contracted, exports kept the economy going, but with the dollar strengthening and Europe and the rest of the world declining, it was hard to see how that could continue. Meanwhile, states faced massive drop-offs in revenues - they would have to cut back on expenditures. Without quick action by government, the economy faced a downturn. And even if banks had lent wisely - which they hadn’t - the downturn was sure to mean an increase in bad debts, further weakening the struggling financial sector.

The administration talked about confidence building, but what it delivered was actually a confidence trick. If the administration had really wanted to restore confidence in the financial system, it would have begun by addressing the underlying problems - the flawed incentive structures and the inadequate regulatory system.

Was there any single decision which, had it been reversed, would have changed the course of history? Every decision - including decisions not to do something, as many of our bad economic decisions have been - is a consequence of prior decisions, an interlinked web stretching from the distant past into the future. You’ll hear some on the right point to certain actions by the government itself - such as the Community Reinvestment Act, which requires banks to make mortgage money available in low-income neighborhoods. (Defaults on C.R.A. lending were actually much lower than on other lending.) There has been much finger-pointing at Fannie Mae and Freddie Mac, the two huge mortgage lenders, which were originally government-owned. But in fact they came late to the subprime game, and their problem was similar to that of the private sector: their C.E.O.’s had the same perverse incentive to indulge in gambling.

The truth is most of the individual mistakes boil down to just one: a belief that markets are self-adjusting and that the role of government should be minimal. Looking back at that belief during hearings this fall on Capitol Hill, Alan Greenspan said out loud, “I have found a flaw.” Congressman Henry Waxman pushed him, responding, “In other words, you found that your view of the world, your ideology, was not right; it was not working.” “Absolutely, precisely,” Greenspan said. The embrace by America - and much of the rest of the world - of this flawed economic philosophy made it inevitable that we would eventually arrive at the place we are today.

——–

/Joseph E. Stiglitz, a Nobel Prize winning economist, is a professor at Columbia University./

mandag den 15. december 2008

Det vi ved, at vi ikke ved

Skrevet af: Rune Lykkeberg


I anledning af den offentlige sandhed om, at to tunesere har planlagt et mord på en tegner er det måske på tide, at minde om Donald Rumsfelds filosofi om det vi ved, og det vi ikke ved

'As we know, there are known knowns. There are things we know we know. We also know here are known unknowns. That is to say we know there are some things we do not know. But there are also unknown unknowns. The ones we don't know we don't know.'

- Donald Rumsfeld

Trist, sagde Pia Kjærsgaard. Og trist sagde studieværten i TV-Avisen bagefter. De var enige om, at der var tale om en trist udvikling. Det handlede om den ene af de to tunesere, som tidligere på året blev administrativt udvist af Integrationsministeriet. Den anden, som var den, der som kampsportsspecialist ifølge Politiets Efterretningstjeneste skulle kvæle tegneren Kurt Westergaard, har allerede forladt landet.

Der var også en tredje mand involveret. Han blev sigtet for mordforsøg på tegneren, men statsadvokaten valgte siden at frafalde sigtelsen på grund af manglende beviser. Den minister, som havde ansvaret for den administrative udvisning, udtalte allerede dengang, at hun "ikke var begejstret". Det har hun siden gentaget.

Højesteret anmodede i sommeren 2008 om en undersøgelse af det bevismateriale, som skulle ligge til grund for udvisningerne og antagelsen om, at de to var i færd med at planlægge et mord på Kurt Westergaard. PET afviste at udlevere al materiale, men det viste sig, at den tuneser, som er blevet i Danmark, angiveligt er mistænkt for at planlægge mordet på Kurt Westergaard, fordi han har set en selvmordsvideo på nettet, og fordi han i 2005 var i færd med at købe en bil, der ifølge tjenesten skulle bruges til flugten.

Det viste sig også, at den pistol, som PET havde fundet hos den nu bortrejste tuneser, ikke var et potentielt dræbende skydevåben, men derimod en gaspistol, der oven i købet var i stykker.

Det Pia Kjærsgaard mandag aften kaldte "en trist udvikling" var, at den tuneser, som er forblevet i Danmark, ikke kan fængsles, fordi han ikke er dømt. Og ganske påfaldende blev hendes politiske vurdering gentaget af journalisten i studiet: "Det er en trist udvikling."

En vurdering fra Politiets Efterretningstjeneste er således vandret til at blive et politisk udsagn og endelig til en sandhed, som gentages af en studievært på tv.
Den troværdige agent

Det bliver sagt, som om det er noget vi ved positivt, at denne mand skulle være til fare for statens sikkerhed. Justitsministeren har også på trods af Højesterets afgørelse udtalt, at der er tale om "en farlig mand". Men hvis der er noget, vi ved positivt, så er det ikke, at vi ikke ved det. Som den forhenværende amerikanske forsvarsminister Donald Rumsfeld berømt udtalte, må man skelne det, vi ved, at vi ved, det vi ved, at vi ikke ved, og endelig det, som vi ikke ved, at vi ikke ved.

Det sidste er det selvsagt svært at give eksempler på, og det første giver sig selv. Men om PET's vurdering af de to tunesere ved vi, at en af de ansvarlige ministre, der har set grundlaget for den administrative udvisning ikke var begejstret. Vi ved også, at PET's rolle er blevet udvidet med antiterrorloven. Efterretningstjenesten skal ikke længere kun forhindre angreb. Den skal også føre sager ved domstolene. Vi ved, at PET har tabt flere af disse sager.

Ved den såkaldte Glostrup-sag ved vi også, at bevisførelserne mod de fire terrortiltalte i høj grad baserede sig på vurderinger af ydre tegn på de sigtedes religionsforhold: Langt skæg blev eksempel brugt som indicium. Det påfaldende var, at disse indicier blev vurderet som overbevisende af domsmændene, hvorefter dommerne valgte at skride ind og slå fast, at der ikke var tale om beviser. Tre ud af fire tiltalte blev således frifundet. Vi ved også, at PET siden 1999 er blevet undersøgt af en kommission, som blev nedsat ved lov. Meget ved vi ikke om denne kommissions langvarige arbejde, fordi det meste foregår for lukkede døre. Vi ved også, at PET i den såkaldte Vollsmose-sag brugte en civil agent, som af klassekammerater og tidligere kolleger var kendt for både voldsomme overdrivelser og rene løgnehistorier. Han meldte sig selv til PET som angiver og blev af tjenesten vurderet som troværdig. Hans vidneudsagn var med til sende terrormistænkte i fængsel i op til 12 år.

Derudover ved vi, at PET tidligere har løjet for offentligheden. Efter anholdelserne af de terrormistænke i Vollsmose i 2006 kom det frem, at PET havde trukket hætter ned over hovederne på de anholdte, hvilket er i strid med torturkonventionen. De anholdte fortalte selv om hætterne. Først benægtede PET brugen af hætterne, siden indrømmede tjenesten det.
Den triste udvikling

Vi ved altså, at PET ikke altid siger sandheden. Vi ved også, at det ikke er PET's opgave at sige sandheden til borgerne. Derfor ved vi også, at der en masse, vi ikke ved. Det er ikke kontroversielle eller systemkritiske antagelser. Det er forhold, som PET sikkert selv vil bekræfte. Det forekommer på den baggrund besynderligt, at en kritisk offentlighed, der som regel tager for givet, at danskerne er anti-autoritære og ikke vil påduttes andres dogmer, tilsyneladende ophøjer PET's postulater til sandheder.

Det regnes for helt sikkert, at Kurt Westergaard skulle være genstand for planer om et attentat. Og tuneserne regnes for dem, der skulle gøre det. Der tales i offentligheden, som om, det er noget, vi ved. Men det, vi ved, er faktisk, at vi ikke ved det. Vi kan ikke påberåbe os den uskyld, som tilkommer dem, der ikke ved, at de ikke ved det. Og når dette enten behændigt glemmes eller bevidst ignoreres, synes det berettiget at tale om en trist udvikling.

Al Jazeera om Israelsk Tortur.

tirsdag den 9. december 2008

A Whitewash for Blackwater?

The federal manslaughter indictment of five Blackwater Worldwide security guards in the horrific massacre of more than a dozen Iraqi civilians in Baghdad may look like an exercise in accountability, but it's probably the exact opposite -- a whitewash that absolves the government and corporate officials who should bear ultimate responsibility.

If what Justice Department prosecutors allege is true, the five guards -- Donald Ball, Dustin Heard, Evan Liberty, Nicholas Slatten and Paul Slough -- should have to answer for what happened on Sept. 16, 2007. The men, working under Blackwater's contract to protect State Department personnel in Iraq, are charged with spraying a busy intersection with machine-gun fire and grenades, killing at least 14 unarmed civilians and wounding 20 others. One man, prosecutors said yesterday, was shot in the chest with his hands raised in submission.

The indictment, charging voluntary manslaughter and weapons violations, demonstrates that those who engage "in unprovoked attacks will be held accountable," Assistant Attorney General Patrick Rowan claimed.

But it demonstrates nothing of the sort. As with the torture and humiliation of detainees at the Abu Ghraib prison, our government is deflecting all scrutiny from the corporate higher-ups who employed the guards -- to say nothing of the policymakers whose decisions made the shootings possible, if not inevitable.

Prosecutors did not file charges against the North Carolina-based Blackwater firm -- the biggest U.S. security contractor in Iraq -- or any of the company's executives. The whole tragic incident is being blamed on the guards who, prosecutors say, made Baghdad's Nisoor Square a virtual free-fire zone.

The Blackwater guards were nervous because of a car bombing elsewhere in the city that day. The company says the Blackwater convoy came under attack by insurgents, prompting the guards to fire in self-defense. "Tragically, people did die," defense attorney Paul Cassell told reporters.

There is a huge difference between self-defense and the kind of indiscriminate fusillade that the Blackwater team allegedly unleashed. Proper training and supervision -- which was the Blackwater firm's responsibility -- would have made it more likely for the guards to make the right split-second decisions amid the chaos of Nisoor Square. Rather than give Blackwater a free pass, the Justice Department ought to investigate the preparation these men were given before being sent onto Baghdad's dangerous streets.

Blackwater no doubt has rules and regulations about when and where its people can discharge their weapons. But were those rules enforced? Did the guards who were indicted yesterday have any reason to believe they would be punished for the rampage? Or were the shootings considered acceptable inside the Blackwater bunker? Company executives should have to answer these and other questions -- under oath.

But a real attempt to establish blame for this massacre should go beyond Blackwater. It was the Bush administration that decided to police the occupation of Iraq largely with private rather than regular troops.

There are an estimated 30,000 security "contractors" in Iraq, many of them there to protect U.S. State Department personnel. The presence of these heavily armed private soldiers has become a sore point between the U.S. and Iraqi governments. Until now, the mercenaries -- they object to that label, but it fits -- have been immune from prosecution by the Iraqi courts for any alleged crimes. This will change on Jan. 1, when the new U.S.-Iraqi security pact places them under the jurisdiction of Iraqi law. Blackwater and other firms are likely to have a harder time retaining and recruiting personnel, given the possibility of spending time in an Iraqi prison. Yet it is presumed that more private soldiers, rather than fewer, will be needed as the United States reduces troop levels.

Barack Obama has criticized the Bush administration's decision to outsource so many essentially military tasks in Iraq and elsewhere. The officials who made that decision, however, are not being held accountable -- not yet, at least. We deserve, at a minimum, a thorough investigation of what security contractors have done in the name of the United States.

Putting national security in the hands of private companies and private soldiers was bad practice from the start, and incidents such as what happened at Nisoor Square are the foreseeable result. The five Blackwater guards may have fired the weapons, but they were locked and loaded in Washington.

http://www.washingtonpost.com/wp-dyn/content/story/2008/12/09/ST2008120900107.html

Five Steps to Tyranny

US: Blackwater used grenades on unarmed Iraqis

WASHINGTON (AP) -- Blackwater Worldwide security guards opened machine gun fire on innocent, surrendering Iraqis and launched a grenade into a girls' school during a gruesome Baghdad shooting last year, prosecutors said Monday in announcing manslaughter charges against five guards.
A sixth guard involved in the attack cut a plea deal with prosecutors, turned on his former colleagues, and admitting killing at least one Iraqi in the 2007 shooting in Baghdad's Nisoor Square. Seventeen Iraqis were killed in the assault, which roiled U.S. diplomacy with Iraq and fueled anti-American sentiment abroad.

The five guards surrendered Monday and were due to ask a federal judge in Utah for bail.

"None of the victims of this shooting was armed. None of them was an insurgent," U.S. Attorney Jeffrey Taylor said. "Many were shot while inside civilian vehicles that were attempting the flee from the convoy. One victim was shot in the chest while standing in the street with his hands up. Another was injured from a grenade fired into a nearby girls' school."

The guards were charged with 14 counts of manslaughter and 20 counts of attempted manslaughter. They are also charged with using a machine gun to commit a crime of violence, a charge that carries a 30-year minimum prison sentence.

The shootings happened in a crowded square where prosecutors say civilians were going about their lives, running errands. Following a car bombing elsewhere in the city, the heavily armed Blackwater convoy sought to shut down the intersection. Prosecutors said the convoy, known by the call sign Raven 23, violated an order not to leave the U.S.-controlled Green Zone.

"The tragic events in Nisoor Square on Sept. 16 of last year were shocking and a violation of basic human rights," FBI Assistant Director Joseph Persichini said.

Witnesses said the contractors opened fire unprovoked. Women and children were among the victims and the shooting left the square littered with blown-out cars. Blackwater, the largest security contractor in Iraq, says its guards were ambushed and believed a slowly moving white Kia sedan might have been a car bomb.

"We think it's pure and simple a case of self-defense," defense attorney Paul Cassell said Monday as the guards were being booked. "Tragically people did die."

Prosecutors said the Blackwater guards never even ordered the car to stop before opening fire. In his plea agreement with prosecutors, former guard Jeremy Ridgeway, of California, admitted there was no indication the Kia was a car bomb.

Though the case has already been assigned to U.S. District Judge Ricardo M. Urbina in Washington, the guards surrendered in Utah. They want the case moved there, where they would presumably find a more conservative jury pool and one more likely to support the Iraq war.

The indicted guards are Donald Ball, a former Marine from West Valley City, Utah; Dustin Heard, a former Marine from Knoxville, Tenn.; Evan Liberty, a former Marine from Rochester, N.H.; Nick Slatten, a former Army sergeant from Sparta, Tenn.; and Paul Slough, an Army veteran from Keller, Texas.

Ridgeway's sentencing on manslaughter, attempted manslaughter and aiding and abetting has not yet been scheduled.

An afternoon court hearing was scheduled on whether to release the guards. Defense attorneys were filing court documents challenging the Justice Department's authority to prosecute the case. The law is murky on whether contractors can be charged in U.S. courts for crimes committed overseas.

The shootings caused an uproar, and the fledgling Iraqi government in Baghdad wanted Blackwater, which protects U.S. State Department personnel, expelled from the country. It also sought the right to prosecute the men in Iraqi courts.

"The killers must pay for their crime against innocent civilians. Justice must be achieved so that we can have rest from the agony we are living in," said Khalid Ibrahim, a 40-year-old electrician who said his 78-year-old father, Ibrahim Abid, died in the shooting. "We know that the conviction of the people behind the shooting will not bring my father to life, but we will have peace in our minds and hearts."

Defense attorneys accused the Justice Department of bowing to Iraqi pressure .

"We are confident that any jury will see this for what it is: a politically motivated prosecution to appease the Iraqi government," said defense attorney Steven McCool, who represents Ball.

Based in Moyock, N.C., Blackwater is the largest security contractor in Iraq and provides heavily armed guards for diplomats. Since last year's shooting, the company has been a flash point in the debate over how heavily the U.S. relies on contractors in war zones

The company itself was not charged in the case. In a lengthy statement, Blackwater stood behind the guards and said it was "extremely disappointed and surprised" that one of the guards had pleaded guilty.

Iraq's oil-rich Basra province in autonomy move

NATIONAL SYMBOL: Iraqi soldiers hang a huge flag from the roof of Basra Palace in 2007. (AFP)Iraq's independent electoral commission announced plans on Sunday to collect signatures in support of a referendum to transform the oil-rich province of Basra into an autonomous region.

Signatures would be collected from Dec. 15 to Jan. 14 in 34 centres across the predominantly Shi'ite province, the Independent High Electoral Commission (IHEC) said in a statement.

According to the IHEC, there are 1,409,393 eligible voters in the province of Basra which includes the city of Basra, Iraq's second port along with Umm Al-Qasr and the country's economic nerve centre.

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"If after the certification of the signature collection process the signature list reaches the required 10 percent of the 'Final Voters List', a referendum will be held within three months," the statement said.

More than 70 percent of Iraq's oil is produced in Basra and its port is used for 80 percent of crude exports.

The region has been riven with the rivalries among three main Shi'ite factions - the former rebel Supreme Iraqi Islamic Council (SIIC), the Mahdi Army of firebrand cleric Moqtada Al-Sadr and the smaller Fadhila party.

If the referendum is organised and accepted, it will transform Basra into an autonomous region with the same rights as Kurdistan, the autonomous region in northern Iraq which also enjoys considerable oil wealth.

Over the past year, the Kurdish regional government has angered Baghdad by finalising its own energy law and signing contracts with global oil majors despite the absence of national oil legislation.

The national law has been delayed in parliament over bitter differences among the assembly's Shi'ite, Sunni and Kurdish lawmakers over the sharing of the revenues generated from oil sales.

http://www.arabianbusiness.com/540558-iraqs-oil-rich-basra-province-autonomy-move

Human rights report: West Bank situation 'reminiscent of apartheid regime in South Africa'

Basic human rights, such as health, a life of dignity, education, housing, equality, freedom from racism, freedom of expression, privacy and democracy are increasingly being violated in Israel, a human rights watchdog group warned Sunday.

In its annual report, the Association of Civil Rights in Israel (ACRI) pointed to "extremely worrisome trends at the center of which are violations of the most elementary human rights."

The report also noted that the situation in the occupied West Bank, between Israeli settlers and the local Palestinian population, was "reminiscent, in many and increasing ways, of the apartheid regime in South Africa."

The ACRI noted that since the foundation of Israel, the country's Arab citizens have been discriminated against though legislation and allocation of resources.

In addition, women were widely discriminated against in the workplace, earning less money than men in nearly every profession, with a higher rate of unemployment, and with representation in the Israeli academia 10 per cent lower than the average in any of the European Union nations.

While the discrimination between Jews of European origins and those of Oriental or Middle Eastern origin has now been virtually eradicated, the report said, the socioeconomic gap between the two groups has grown, which bolsters a feeling of discrimination.

As regards the Israeli occupation of the Palestinian areas, the ACRI said that Israeli settlements in the West Bank have resulted in institutionalized discrimination in which two separate populations live under two separate judicial systems.

Allocation of funds and services in the occupied area is also unequal and settler violence against local Palestinians has grown.

Many of the 430 people killed and 1,150 wounded in the West Bank by Israeli security forcers in 2008 were innocent bystanders, the report said, without giving exact figures.

The report went on to note that despite progressive labour legislation in Israel, the rights of employees are still violated, or at least not enforced, and many services remain physically inaccessible to the handicapped, who also suffer from a high rate of unemployment compared to the rest of the population.

However, the ACRI did find that the rights of gays in Israel were relatively advanced compared to other Western countries, and gay couples enjoyed the same rights as common-law couples.

The report was published to coincide with the 60th anniversary of the United Nations Universal Declaration of Human Rights.

kilde: http://www.haaretz.com/hasen/spages/1044309.html

mandag den 8. december 2008

'2025' Report: A World of Resource Strife

Michael Klare | December 2, 2008

A new report by the National Intelligence Council (NIC) on the emerging strategic landscape, "Global Trends 2025," has attracted worldwide attention because it forecasts a future environment in which the United States wields less power than it does today and must contend with a constellation of other, newly ambitious great powers. "Although the United States is likely to remain the single most important actor," the report notes, "the United States' relative strength — even in the military realm — will decline and U.S. leverage will become more constrained." Of all the many revealing findings in the study, this has been the most widely quoted.

That the United States is likely to experience a decline in its strength relative to other great powers over the next 10 to 15 years is, of course, an observation bound to attract keen attention around the world, where criticism of U.S. foreign policy — over the Iraq War, the handling of the war on terror, our failure to sign the Kyoto Protocol on climate change — remains strong. The fact that "Global Trends 2025" emanated from a U.S. government agency — the NIC is part of the "national intelligence community" and reports to the Director of National Intelligence — lends additional weight to its findings. Still, when all is said and done, it's hardly surprising that professional analysts would come to this conclusion, given the enormous toll on America's military and economic resources taken by five-and-half years of fighting in Iraq and the accompanying loss to our influence, prestige, and goodwill abroad.

Climate and Competition

Far more striking and original, I believe, is the report's emphasis on the role of climate change and resource competition in the world of 2025 and beyond. Until now, these issues have appeared solely on the margins of U.S. strategic and intelligence studies. Now, for the first time, they have moved front and center.

"Resource issues will gain prominence on the international agenda," the NIC report notes. "Unprecedented global economic growth — positive in so many other regards — will continue to put pressure on a number of highly strategic resources, including energy, food, and water, and demand is projected to outstrip easily available supplies over the next decade or so."

The likely future availability of energy and water receives especially close attention. Oil, in particular, is seen as being at risk of failing to meet anticipated world requirements: "Non-OPEC liquid hydrocarbon production — crude oil, natural gas liquids, and unconventionals such as tar sands — will not grow commensurate with demand. Oil and gas production of many traditional energy producers already is declining…Countries capable of significantly expanding production will dwindle; oil and gas production will be concentrated in unstable areas." The bottom line: global oil supplies will be inadequate to satisfy demand, and importing nations will be forced to consume less and/or speed the production of alternatives.

Water scarcity is seen as an equally significant problem: "Lack of access to stable supplies of water is reaching critical proportions, and the problem will worsen because of rapid urbanization worldwide and the roughly 1.2 billion persons to be added [to the world's population] over the next 20 years." At present, we are told, some 600 million people in 21 countries are suffering from inadequate water supplies; by 2025, an estimated 1.4 billion people in 36 countries will face this peril.

Global warming will further exacerbate resource pressures, especially with respect to water and food. Although the impact of climate change will vary from region to region and cannot be predicted with precision, "a number of regions will begin to suffer harmful effects, particularly water scarcity and loss of agricultural production." Some areas will suffer more than others, "with declines disproportionately concentrated in developing countries, particularly those in sub-Saharan Africa." For many of these countries, "decreased agricultural output will be devastating because agriculture accounts for a large share of their economies and many citizens live close to subsistence levels."

Resource Wars

That resource scarcity and climate change will become increasingly severe in the decades ahead are hardly novel observations — many "peak oil" and environmental groups have been saying the same thing for years. But the NIC report takes this one step further by describing how these phenomena will intrude into international affairs and could provide the spark for armed violence. Increased scarcity, it suggests, could lead to greater efforts by states to secure control over overseas sources of energy and other key resources, producing geopolitical struggles among the major energy-deficit nations and possibly provoking all-out war.

"The rising energy demands of growing populations and economies may bring into question the availability, reliability, and affordability of energy supplies," the report notes. "Such a situation would heighten tensions between states competing for limited resources…In the worst case this could lead to interstate conflicts if government leaders deem assured access to energy resources to be essential to maintaining domestic stability and the survival of the regime."

Even in the absence of major interstate conflict, the report argues, growing competition for dwindling energy supplies could lead to heightened tensions, internal conflict, and terrorism. "Even actions short of war will have important geopolitical implications as states undertake strategies to hedge against the possibility that existing energy supplies will not meet rising demands." For example, "energy-deficient states may employ transfers of arms and sensitive technologies and the promise of a political and military alliance as inducements to establish strategic relationships with energy-producing states." Such relationships are already emerging in Central Asia, where China, Russia, and the United States are all competing for access to and control over the region's oil and gas reserves.

The growing concentration of wealth in the hands of petro-elites in places like Angola, Azerbaijan, Kazakhstan, and Nigeria will be another source of potential conflict. Because such elites rarely allocate oil revenues on an equitable basis or allow for a democratic transfer of power, any alteration in national governance (and the distribution of wealth) is likely to be accompanied by violence — often in the form of attacks on pipelines, refineries, and other oil-industry infrastructure. This, in turn, could invite "military intervention by outside powers to stabilize energy flows."

Several areas of the world are likely to figure in energy conflicts of this sort, especially Sub-Saharan Africa, the Middle East, and Central Asia. Each is the site of overlapping lines of conflict produced by a combination of ethnic and religious schisms, internal disputes over the allocation of resource revenues, and the contending geopolitical interests of the major powers. Under these circumstances, it would not take much for a minor skirmish — such as that between Georgia and Russia last August — to escalate into something much greater.

Water and land scarcity brought about or exacerbated by climate change could also trigger armed conflict, suggests the NIC report, although mostly of the internal sort. "Climate change is unlikely to trigger interstate war, but it could lead to increasingly heated interstate recriminations and possibly to low-level armed conflicts." A particular danger zone is the Himalayan region, where the ongoing melting of major glaciers is expected to diminish the annual flow of vital rivers in Bangladesh, China, India, and Pakistan — many of them shared by two or more of these countries and a perennial source of friction among them.

Clusters of Hostility

Terrorist violence will also be spurred by the struggle over critical resources. As climate change and water scarcity renders many rural areas uninhabitable — especially in high-population-growth areas of North Africa, the Middle East, and Asia — hundreds of millions of unemployed young men will pour into the sprawling mega-cities of the developing world, often facing unfriendly reception from the original inhabitants of these areas (who often will be of another religion or ethnicity). Some of these desperate, bitter young men will be drawn to crime; others to militant ideologies and movements.

"As long as turmoil and societal disruptions, generated by resource scarcities, poor governance, ethnic rivalries, or environmental degradation, increase in the Middle East, conditions will remain conducive to the spread of radicalism and insurgencies," the report concludes. And these clusters of hostility will not be confined to the Middle East: "Increasing interconnectedness will enable individuals to coalesce around common causes across national boundaries, creating new cohorts of the angry, downtrodden, and disenfranchised."

As the report makes clear, these phenomena will have an ever-increasing impact on world affairs. For one thing, the growing uninhabitability of large parts of North Africa, the Middle East, Asia, and Central America will force more and more people to migrate to the cities — producing political and social unrest, as noted — or across international boundaries, to countries less severely affected by climate change and resource scarcity. This surely will produce increased political debate over immigration in receiving countries — and, in all likelihood, an increase in anti-immigrant violence. At the same time, it will complicate the task of combating international terrorist networks that recruit from and hide within immigrant communities in Europe and elsewhere.

New Technologies

Eventually, the report suggests, entrepreneurs and their government backers in the industrialized world will develop new materials and technologies to replace substances in short supply or methods for using them more sparingly. For example, we can expect further improvements in wind and solar power, advanced biofuels, hydrogen fuel-cells, and other alternative energy systems making them more efficient and affordable. This technological revolution will be well underway by 2025 — but not so far advanced as to erase the problems raised by inadequate supplies of oil and natural gas. Also, land and water scarcity will remain a significant worry no matter how much progress is made in other areas. The report's warning of intensified resource strife in 2025 and beyond should, therefore, be read with considerable alarm.

Drawing the Future From the Past...

The bombing was relentless. From 1964 to 1973, the United States dropped more than 2 million tons of ordnance on Laos. That's a planeload of bombs every eight minutes, 24 hours a day, for nine years. Laos has the unfortunate distinction of being the most heavily bombed country in the history of the world.
"In the area of Xieng Khoang, the place of my birth, there was health, good earth, and fine weather," one survivor, a 33-year-old man, recalls of that period. "But then the airplanes came, bombing the rice fields and the forests, making us leave our land and rice fields with great sadness. One day a plane came bombing my rice field as well as the village. I had gone very early to harrow the field. I thought, ‘I am only a village rice farmer, the airplane will not shoot me.’ But that day truly it did shoot me and wounded me together with my buffalo, which was the source of a hundred thousand loves and a hundred thousand worries for me."

For nearly three decades, the U.S. secret war in Laos and the impact of the most massive bombing campaign in the world was nearly forgotten. For those who remembered, the events seemed surreal. They witnessed the reckless destruction of a people and their land, and careful efforts by the U.S. government to conceal it. For those too young to know, gathering information and knowledge of this history was scattered and fragmented. It seemed the secret war in Laos and its aftermath would remain a secret.

But then a remarkable set of drawings and eyewitness accounts came to light. Laotian villagers put their memories on paper in the 1970s to depict the secret bombing of their country. This trove of reminiscences became the inspiration for Legacies of War. Founded by Laotian Americans in 2004, the project raises awareness about the history of the Vietnam War-era bombing in Laos. Using a unique combination of art, culture, education, community organizing, advocacy, and dialogue, Legacies of War also works for the removal of unexploded bombs in Laos, to provide space for healing the wounds of war, and to create greater hope for a future of peace.

A Secret War, a People Scattered
When the United States withdrew from Indochina, the "Secret War" in Laos was lost to history. But the legacy of the war lives on. Up to 30% of the cluster bombs dropped by the United States in Laos failed to detonate, leaving extensive contamination from unexploded ordnance (UXO) in the countryside. That translates into 78 to 130 million unexploded bomblets. Over one-third of the land in Laos is contaminated. These "bombies," as the Lao now call them, have killed or maimed more than 34,000 people since the war's end, and continue to claim more innocent victims every day. About 40% of accidents result in death, and 60% of the victims are children. UXO remains a major barrier to the safety, health, livelihoods, and food security of the people of Laos.

The war also displaced up to one-third of the Lao population. Nearly 750,000 would eventually become refugees in France, Australia, and Canada, among other countries. Over 350,000 refugees from Laos came to the United States after having experienced war, destruction, death, imprisonment, family separation, loss of homeland, loss of identity, and loss of control over their destinies. Many had undiagnosed post-traumatic stress disorder. But these weren't things Laotian refugees had the luxury to contemplate, for basic economic survival trumped all other needs.

Drawing on the Past
Between December 1970 and May 1971, Fred Branfman, an American, and Boungeun, a Lao man, collected illustrations and narratives in the Vientiane refugee camps, where bombing victims fled. The drawings and narratives represent the voiceless, faceless, and nameless who endured an air war campaign committed in secrecy. Drawn in pencil, pens, crayons, and markers, they are raw and stark, reflecting the crude events that shaped their reality. The simplicity of the narration and drawings emphasize the illustrators' identities as ordinary villagers who bore witness to a devastating event.

For instance, an 18-year-old woman remembers, "In the year 1967, my village built small shelters in the forest and we had holes in the bamboo thicket on top of the hill. It was a place to which we could flee. But there were two brothers who went out to cut wood in the forest. The airplanes shot them and both brothers died. Their mother and father had just these two sons and were both in the same hole with me. I think with much pity about this old father and mother who were like crazy people because their children had died."

Each of the illustrations demonstrates the violence of warfare. However, the images of blood and death are contradicted by the memories of the scenic and peaceful village life these survivors once lived. Scenes show farmers tending to their rice fields, monks praying at the temple, women going to the market, and children playing in the schoolyard. The drawings capture the very moments when their lives and society were forever altered. The illustrations and narratives are at the heart of the Legacies of War National Traveling Exhibition, which is accompanied by historical photos, maps and other relevant documents to give context to the decade-long bombings.

Only a small circle of individuals knew of the existence of these illustrations. The pictures hadn’t been seen in decades, not since the end of the war. A fortuitous meeting between me and Institute for Policy Studies director John Cavanagh led to the return of the illustrations to the Lao American community. In the last several years, thousands of visitors have seen the illustrations through the Legacies of War traveling exhibit and other community forums. Although most Laotian Americans didn't experience the same horrors depicted in the drawings, the illustrations invoke memory of their own stories of refuge, survival, and resilience.

The reaction to the drawings was instructive to Legacies’ work. Initially considered an artifact, the illustrations have become a living document. One at a time, each drawing tells the story of a survivor. Although the illustrations were from four decades ago, they inspire others to share their stories, contributing to a collective narrative that began long ago in Laos, but continues today through the voices of Laotian Americans.

Following a viewing of the illustrations at an exhibit in Lowell, Massachusetts, a Lao woman in the audience stood up to speak at a community forum, "The illustrations made me remember. I have not shared, not even with my family because I didn't think it was important. When I was a young woman in Laos, I worked as a nurse to help people hurt by the bombing. Every day, the airplanes would come: Boom! Boom! Boom! And then one day, it came so close to us, we had to hide in the cave and we hear right outside the cave, the sound so loud. It scared me so much. I feel so lucky I did not die. The pictures made me remember. I am so sad that today, people in Lao are still being hurt and dying from these bombs." The woman, whose husband had spoken on several occasions about his experience, had never shared hers. The illustrations and community forum gave her a chance to tell her story for the first time in 30 years. Today, she remains engaged in educating people in the Boston-area about the bombing and its aftermath.

These new voices and stories are captured in various ways through Legacies of War: interactive exhibition pieces, community programs, oral history interviews, theater performance pieces, and new commissioned works of art. Based on oral histories collected from Laotian refugees and their descendents, the Refugee Nation theater piece reveals connections between U.S. and Southeast Asian history, and the unique challenges faced by political refugees and their American children. Touching on themes of identity, globalization, and activism, it brings a Laotian voice to a growing part of the Asian-American Diaspora that is yet to be included in the American experience. <

The integration of storytelling, art, and performance are critical in breaking the silence. By creating multiple access points of engagement, Legacies of War facilitates the connection of personal stories to a collective experience in recognition that we are not alone in our experiences, that we are connected to a larger narrative and a larger context. The acknowledgement of a shared journey and struggle could lead to collective strength and power.

Since the end to the U.S. wars in Southeast Asia, many other wars have been waged, in other parts of the world, in new terrain, villages, and communities. Yet, the wars in Southeast Asia lingers. And for the people living in Laos as well as those who became refugees, the lingering impact of war remains ever present in their daily lives. Although war and conflict created the refugee community, they don't have to define it. Through the transformative power of stories, art, and performance, Laotian Americans are evolving from victim to agency of change. "Now that I know about the secret war," said a Lao American student in Seattle, "I have to do something about the horrible things that are still happening to people. As Americans, we must do something."

Another victim, a 37-year old woman, reflects, "Our lives became like those of animals desperately trying to escape their hunters . . . Human beings, whose parents brought them into the world and carefully raised them with overflowing love despite so many difficulties, these human beings would die from a single blast as explosions burst, lying still without moving again at all. And who then thinks of the blood, flesh, sweat and strength of their parents, and who will have charity and pity for them?...In reality, whatever happens, it is only the innocent who suffer. And as for other men, do they know all the unimaginable things happening in this war?"

Copyright © 2008, Institute for Policy Studies

http://www.fpif.org/fpiftxt/5719

Memo For Obama

For: the President-Elect, Mr. Barack Obama.

From: Uri Avnery, Israel.

The following humble suggestions are based on my 70 years of experience as an underground fighter, special forces soldier in the 1948 war, editor-in-chief of a newsmagazine, member of the Knesset and founding member of a peace movement:

As far as Israeli-Arab peace is concerned, you should act from Day One.

Israeli elections are due to take place in February 2009. You can have an indirect but important and constructive impact on the outcome, by announcing your unequivocal determination to achieve Israeli-Palestinian, Israeli-Syrian and Israeli-all-Arab peace in 2009.

Unfortunately, all your predecessors since 1967 have played a double game. While paying lip service to peace, and sometimes going through the motions of making some effort for peace, they have in practice supported our governments in moving in the very opposite direction. In particular, they have given tacit approval to the building and enlargement of Israeli settlements in the occupied Palestinian and Syrian territories, each of which is a land mine on the road to peace.

All the settlements are illegal in international law. The distinction sometimes made between “illegal” outposts and the other settlements is a propaganda ploy designed to obscure this simple truth.

All the settlements since 1967 have been built with the express purpose of making a Palestinian state – and hence peace - impossible, by cutting the territory of the prospective State of Palestine into ribbons. Practically all our government departments and the army have openly or secretly helped to build, consolidate and enlarge the settlements – as confirmed by the 2005 report prepared for the government (!) by Lawyer Talia Sasson.

By now, the number of settlers in the West Bank has reached some 250,000 (apart from the 200,000 settlers in the Greater Jerusalem area, whose status is somewhat different.) They are politically isolated, and sometimes detested by the majority of the Israel public, but enjoy significant support in the army and government ministries.

No Israeli government would dare to confront the concentrated political and material might of the settlers. Such a confrontation would need very strong leadership and the unstinting support of the President of the United States to have any chance of success.

Lacking these, all “peace negotiations” are a sham. The Israeli government and its US backers have done everything possible to prevent the negotiations with both the Palestinians and the Syrians from reaching any conclusion, for fear of provoking a confrontation with the settlers and their supporters. The present “Annapolis” negotiations are as hollow as all the preceding ones, each side keeping up the pretense for its own political interests.

The Clinton administration, and even more so the Bush administration, allowed the Israeli government to keep up this pretense. It is therefore imperative to prevent members of these administrations from diverting your Middle Eastern policy into the old channels.

It is important for you to make a complete new start, and to state this publicly. Discredited ideas and failed initiatives – such as the Bush “vision”, the Road Map, Annapolis and the like – should by thrown into the junkyard of history.

To make a new start, the aim of American policy should be stated clearly and succinctly. This should be: to achieve a peace based on the Two-State Solution within a defined time-span (say by the end of 2009).

It should be pointed out that this aim is based on a reassessment of the American national interest, in order to extract the poison from American-Arab and American-Muslim relations, strengthen peace-oriented regimes, defeat al-Qaeda-type terrorism, end the Iraq and Afghanistan wars and achieve a viable accommodation with Iran.

The terms of Israeli-Palestinian peace are clear. They have been crystallized in thousands of hours of negotiations, conferences, meetings and conversations. They are:

13.1 A sovereign and viable State of Palestine will be established side by side with the State of Israel.

13.2 The border between the two states will be based on the pre-1967 Armistice Line (the “Green Line”). Insubstantial alterations can be arrived at by mutual agreement on an exchange of territories on a 1:1 basis.

13.3 East Jerusalem, including the Haram-al-Sharif (“Temple Mount”) and all Arab neighborhoods will serve as the capital of Palestine. West Jerusalem, including the Western Wall and all Jewish neighborhoods, will serve as the capital of Israel. A joint municipal authority, based on equality, may be established by mutual consent to administer the city as one territorial unit.

13.4 All Israeli settlements – except any which might be joined to Israel in the framework of a mutually agreed exchange of territories - will be evacuated (see 15 below).

13.5 Israel will recognize in principle the right of the refugees to return. A Joint Commission for Truth and Reconciliation, composed of Palestinian, Israeli and international historians, will examine the events of 1948 and 1967 and determine who was responsible for what. Each individual refugee will be given the choice between
(1) repatriation to the State of Palestine,
(2) remaining where he/she is living now and receiving generous compensation,
(3) returning to Israel and being resettled,
(4) emigrating to any other country, with generous compensation.
The number of refugees who will return to Israeli territory will be fixed by mutual agreement, it being understood that nothing will be done that materially alters the demographic composition of the Israeli population. The large funds needed for the implementation of this solution must be provided by the international community in the interest of world peace. This will save much of the money spent today on military expenditure and direct grants from the US.

13.6 The West Bank, East Jerusalem and the Gaza Strip constitute one national unit. An extraterritorial connection (road, railway, tunnel or bridge) will connect the West Bank with the Gaza Strip.

13.7 Israel and Syria will sign a peace agreement. Israel will withdraw to the pre-1967 line and all settlements on the Golan Heights will be dismantled. Syria will cease all anti-Israeli activities conducted directly or by proxy. The two parties will establish normal relations between them.

13.8 In accordance with the Saudi Peace Initiative, all member states of the Arab League will recognize Israel and establish normal relations with it. Talks about a future Middle Eastern Union, on the model of the EU, possibly to include Turkey and Iran, may be considered.


Palestinian unity is essential for peace. Peace made with only one section of the people is worthless. The US will facilitate Palestinian reconciliation and the unification of Palestinian structures. To this end, the US will end its boycott of Hamas, which won the last elections, start a political dialogue with the movement and encourage Israel to do the same. The US will respect any result of democratic Palestinian elections.

The US will aid the government of Israel in confronting the settlement problem. As from now, settlers will be given one year to leave the occupied territories voluntarily in return for compensation that will allow them to build their homes in Israel proper. After that, all settlements – except those within any areas to be joined to Israel under the peace agreement - will be evacuated.

I suggest that you, as President of the United States, come to Israel and address the Israeli people personally, not only from the rostrum of the Knesset but also at a mass rally in Tel-Aviv’s Rabin Square. President Anwar Sadat of Egypt came to Israel in 1977, and, by addressing the Israeli people directly, completely changed their attitude towards peace with Egypt. At present, most Israelis feel insecure, uncertain and afraid of any daring peace initiative, partly because of a deep distrust of anything coming from the Arab side. Your personal intervention, at the critical moment, could literally do wonders in creating the psychological basis for peace.

This article was published in the current issue of the progressive Jewish-American monthly TIKKUN.

Analysis: Obama Defense Agenda Resembles Gates'

For a Democrat whose opposition to the Iraq war was a campaign centerpiece, President-elect Barack Obama is remarkably in sync with Defense Secretary Robert Gates on many core defense and national security issues — even Iraq.

The list of similarities suggests the early focus of Obama's Pentagon may not change dramatically from President George W. Bush's.

Given that Obama made the unprecedented decision to keep the incumbent Republican defense secretary, it would seem natural to expect that they see eye to eye on at least some major defense issues. But the extent of their shared priorities is surprising, given Obama's campaign criticisms of Bush's defense policies.

In his first public comments about signing on with the incoming administration, Gates said Tuesday that in his decisive meeting with the president-elect in November, they talked more about how his appointment would be made and how it would work in practice, than about substantive policy issues.

The two "share a common view about the importance of integrating all elements of American power to make us more secure and defeat the threats of the 21st century," Brooke Anderson, the Obama transition office's chief national security spokeswoman, said Saturday.

She said Obama "appreciates Secretary Gates' pragmatism and competence and his commitment to a sustainable national security strategy that is built on bipartisan consensus here at home."

The apparent harmony between Gates and Obama on broad defense and national security aims is on display in a Foreign Affairs magazine article by the defense chief that was released Thursday. Gates lays out a comprehensive agenda based on the Bush administration's new National Defense Strategy. In numerous ways it meshes with the defense priorities that Obama espoused during the campaign. Examples include:

_better integrating and coordinating military efforts with civilian agencies, including the State Department. This is one of the lessons the Bush administration learned from the experience in Iraq and Afghanistan, where initial combat efforts went well, only to fail to avert destabilizing insurgencies.

_building up the security capacity of partner nations. This is central to a belief, advocated by Gates and shared by Obama, that the fight against Islamic extremism — what the Bush administration calls the war on terror — cannot succeed in the long run without help from allies and partners.

_not overlooking the possibility of future threats from conventional military powers, even while continuing to focus on prevailing in the counterinsurgency campaigns where conventional firepower plays a lesser role.

There also are points of potential differences between Obama and Gates: closing the prison for suspected terrorists at Guantanamo Bay, Cuba, and expanding the U.S. missile defense system into Eastern Europe.

Gates advocates both, but on Guantanamo he lost the argument in Bush administration councils.

Obama has been unequivocal that he will close the prison. On missile defense, he has indicated support in general while emphasizing it must not divert resources from other priorities "until we are positive the technology will protect the American people." That condition could lead to delays in the Europe project, although the Pentagon managed a successful test intercept of a target missile over the Pacific on Friday.

But even on Iraq, Gates said that he considers Obama's focus on troop withdrawals to be an "agreeable approach," given that Obama has said he would listen to his commanders on how to proceed. Reminded that he previously had opposed setting a firm timetable for withdrawal, Gates said the situation changed when the Bush administration accepted Iraq's demand for an agreement in writing to remove U.S. combat troops from Iraqi cities by next June and to withdraw entirely by Dec. 31, 2011.

"So we will confront or have a different kind of situation in Iraq at the end of June 2009 than we would have thought perhaps in June of 2008," Gates said. "And I think that the commanders are already looking at what the implications of that are, in terms of the potential for accelerating the drawdown."

Obama has said he believes a full withdrawal of combat troops can be accomplished within 16 months of his swearing in on Jan. 20. But he also has said the withdrawal should be done responsibly. This appears in line with indications that in a meeting last July in Baghdad with Gen. David Petraeus — then the top U.S. commander in Iraq and now the overseer of U.S. military operations across the Middle East — Obama gave hints, if not outright assurances, that he could be flexible on a pullout timetable.

Both Gates and Adm. Mike Mullen, who will remain as chairman of the Joint Chiefs of Staff after Obama takes office, have stressed their eagerness to shift resources, including troops, from Iraq to Afghanistan, where the insurgency has grown in intensity. That, too, is in line with Obama's agenda.

Obama has pledged to continue the expansion of the Army and the Marine Corps that Gates started. They are on the same page, too, with regard to overhauling Pentagon's procurement system.

Also, both emphasize a need to improve the government's ability to address concerns of military families who are under strain from repeated, lengthy and frequent deployments to Iraq and Afghanistan.

EDITOR'S NOTE — Robert Burns has covered defense and national security issues for The Associated Press since 1990.

kilde: http://news.yahoo.com/s/ap/20081206/ap_on_el_pr/obama_on_defense/print

Neoliberalism and Bottom-Line Morality.

From the Reagan era onward I have been impressed with how regularly liberal and left-leaning economists I knew, who went to work in industry and finance, very soon became pro-business, anti-labor, and politically right wing. I think that what got to them was not only the impact of association with businesspeople, but the fact that business profitability became central to their own performance. As business economists, wage increases would seem bad—as encroaching on that profitability and threatening inflation and business growth (and stock prices). Tough environmental rules would also hamper profitability; their relaxation by law or friendly (non-)enforcement would enhance it. It was therefore easy to slide into what we may call "bottom-line morality," with positions on key issues dictated by prospective bottom line effects, but of course rationalized with an ideology that made this all benevolent—in the long run—and made these bottom-line moralists into Good Samaritans as they collected their fat salaries and bonuses while the vast majority waited for trickle-down. (On the fraudulence of this ideology, see David Harvey, A Brief History of Neoliberalism, and Ha-Joon Chang, Bad Samaritans.)

With the steady increase in business's economic and political power over the past 30 years and the parallel decline of organized labor, neoliberal (market-can-do-it-all) ideology has become even more firmly entrenched in establishment thought and practice. The novelist Ayn Rand, most famously the author of Atlas Shrugged, was an extreme proponent of individualist, free enterprise, anti-government ideology, and it is no coincidence that one of her cult admirers and associates, Alan Greenspan, became a leading member of the policy-making elite in the 1980s and into 2006.

Greenspan's "Superlatively Moral System"

Greenspan contributed three chapters to Rand's 1966 book Capitalism: The Unknown Ideal, all of them reflecting her—and Greenspan's—ultra laissez-faire ideology. In one, Greenspan castigates antitrust law and practice as not merely harmful, but with the "hidden intent" of injuring the "productive and efficient members of our society." In another, he claims that all government regulation represented "force and fraud" as the means of consumer protection, whereas it is "profit-seeking which is the unexcelled protector of the consumer." He argues that the market system itself is a "superlatively moral system that the welfare statists propose to improve upon by means of preventive law, snooping bureaucrats, and the chronic goad of fear."

Greenspan contributed to the workings of this "superlatively moral system" at the micro-level back in 1985, writing to the savings and loan authorities on behalf of Charles Keating, head of Lincoln Savings and Loan. In that letter the authorities were urged to exempt Keating from restrictions on risky loans, given his exceptional character and the soundness of his operation, with "no foreseeable risk to the Federal Savings and Loan Corporation." Greenspan was a paid consultant to Lincoln, which failed in 1989 at enormous expense to the FSLIC and taxpayer. Keating ended up in prison. This is the same Charles Keating with whom John McCain had a close relationship and on whose behalf McCain also did some lobbying. Neither Greenspan nor McCain suffered significant damage from this relationship and, despite his extremist ideology, Greenspan became a powerful figure in the U.S. political economy, leading the Fed for many years (1987-2006) and through two major bubbles that he did nothing to constrain.

One important manifestation of Greenspan's world view can be seen in his congressional testimony of July 22, 1997, where he explained that inflation was not increasing despite the lowering unemployment rate because of "a heightened sense of job insecurity," which he described elsewhere as reflecting the "traumatized worker," helpful in keeping wages down. He didn't suggest that job insecurity and the traumatization of workers involved any immoral "goad of fear" or had any negative implications for welfare.

Actually, in this regard Greenspan's view wasn't much different from that of a great many mainstream economists, who were slow to recognize greater job insecurity as a key factor altering the unemployment/inflation relationship, and who were not troubled when they did recognize it. Liberal economist Janet Yellen, co-author with Alan Blinder of a book on the 1990s entitled The Fabulous Decade, told the Federal Reserve Open Market Committee in 1996 that "while the labor market is tight, job insecurity is alive and well. Real wage aspirations seem modest, and the bargaining power of workers is surprisingly low" (quoted in Robert Pollin's Contours of Descent). Robert Pollin points out that Yellen and Blinder didn't let this interfere with their conclusion that the 1990s were "fabulous." Apparently these economists, like Clinton, don't really "feel pain" as long as only workers suffer.

In fact, they are all a throwback to 17th and 18th century mercantilists who, according to historian Edgar S. Furniss, argued that "high wages would prove destructive of national well-being because they would reduce England's competing power by raising production costs. The prevalent doctrine held that wages should be kept at the level of the cost of physical subsistence. Hence the apparent anomaly of the laborer's position: whereas his theoretical social importance was large, his actual economic reward was miserably small.... [Under mercantilism] the dominant class will attempt to bind the burdens upon the shoulders of those groups whose political power is too slight to defend them from exploitation and will find justification for its policies in the plea of national necessity" (Furniss, Position of the Laborer in a System of Nationalism, 1920). Does this ancient view on how burdens should be distributed have some possible application to the bailouts now being put in place to deal with the current financial crisis?

Getting back to Greenspan morality, it is clear from both his Ayn Rand contributions and his writings and public pronouncements of the past 20 years that he views untrammeled capitalism as a "superlatively moral system" not because of businesspeople's benevolence but because market operations in business's self-interest will protect consumers—business will not take on undue risk because that would eventually harm their own welfare. Regulation is thus unnecessary and positively damaging by its arbitrariness and bureaucratic bungling. Greenspan fought long and strenuously for across-the-board deregulation, and against the regulation of derivatives as they grew rapidly in the 1990s, even arguing in 2004 that the innovations like derivatives had contributed to a new stability in the financial system: "Not only have individual financial actors become less vulnerable to shocks from underlying risk factors, but also the financial system as a whole has become more resilient." Such a misunderstanding of reality by a man with great experience and access to the research resources of the Fed can only be understood as a result of the intellectual-ideological bubble within which he worked.

Now that the financial system has collapsed and its leaders have demanded and gotten a huge bailout, what does Greenspan say? Apart from an admitted bafflement, he has stated that business has been too greedy and behaved dishonorably. He is "distressed at how far we [sic] have let concerns for reputation slip in recent years." But this is hogwash. It was rational profit-making that was supposed to control risk, not honorable behavior. Also, if the actual behavior was systemic, and greed can overcome honorable behavior, the Greenspan model has failed on its own terms. But beyond that it was idiotic, as it has long been known that the force of competition, the pressure (and fiduciary obligation) for profits, and regular business myopia in buoyant markets, have repeatedly produced unsustainable excesses. Greenspan's moral model reflects straightforward ideology and bottom line morality. It is also part of a class war perspective where, as noted, labor (and the majority) are viewed in the mercantilist tradition—as a cost to be contained, not as a very large group whose welfare we are trying to maximize. It also helped cause him to misperceive economic reality and make a major and disastrous economic forecasting error.

Greenspan, Rubin, Summers, et al

Both the New York Times and Washington Post had substantial articles on Greenspan's heavy responsibility for the ongoing crisis, in a way beating a dead horse after both papers had treated him with great deference as "the Oracle" for many years (Peter Goodman, "The Reckoning: Taking a Closer Look at a Greenspan Legacy," NYT, Oct. 9, 2008; Anthony Faiola, Ellen Nakashima, and Jill Drew, "What Went Wrong," WP, October 15, 2008). The articles feature the struggle for and against derivatives regulation in the 1990s, with Brooksley E. Born, the head of the Commodity Futures Trading Commission (CFTC) as the pro-regulation protagonist and heroine, and Greenspan as principal villain.

But both articles also call attention to the support given Greenspan in his anti-regulation fight with Born by the leading financial officials of the Clinton administration: Robert Rubin, Larry Summers, and Arthur Levitt, Jr., the first two heading the U.S. Treasury, Levitt the SEC. Rubin looks particularly disingenuous in these articles, claiming to have favored regulating derivatives in 1998, but believing that this was politically unfeasible because of industry opposition and because "there was no potential for mobilizing public opinion." The Times article then paraphrases a former CFTC official that "the political climate would have been different had Mr. Rubin called for regulation."

It should also be recognized that Rubin and Summers are no slouches when it comes to supporting the bailout of fat-cat investors. In his superb book The Global Class War, Jeff Faux features the fact that the corporate establishment which dominates both U.S. political parties is part of the "Party of Davos," that gets together periodically at lush facilities in Davos, Switzerland to party, hob-nob, and plan in the interest of the global business elite. The book focuses heavily on the character and passage of the North American Free Trade Agreement (NAFTA) and then the immediately following Mexican crisis and bailout. NAFTA was a corporate project, strongly opposed by a great majority of Democratic Party voters and by a majority of Democratic legislators. But with Robert Rubin's urging, Clinton put passage of this legislation ahead of health care reform, put a huge political effort into getting it passed, and thereby set the stage for both the failure of health care reform and the Democratic Party's political debacle in 1994. Of course the business community appreciated Clinton's service and here and elsewhere he justified their earlier vetting of his candidacy, organized by Rubin himself.

Rubin had a serious conflict of interest in pushing NAFTA and the subsequent bailout of investors in Mexican securities. He had been a high-ranking official of Goldman Sachs, which did substantial Mexican business, and he had—and even continued to maintain—a number of Mexican clients. NAFTA served only the Party of Davos in the United States and a tiny elite of wealthy people who dominated a famously corrupt political system in Mexico. It was opposed by a U.S. majority and by aware and uncorrupted Mexicans; in Mexico the majority would eventually be seriously damaged by this instrument of the global class war. Its central feature was privileging foreign investors in Mexico, providing also for the gradual elimination of tariffs on agricultural goods and therefore for economic disaster for several million Mexican farmers and their families. (One of Clinton's most notable lies was his claim that NAFTA would serve to slow down Mexican immigration into the United States by spurring investment and development in Mexico.)

The analogy with the current U.S. crisis and bailout is more dramatic when we consider the Mexican crisis of 1994-1995. Shortly after the enactment of NAFTA in 1994, the Mexican government, which for political reasons had tried to peg the peso, suffered a crisis of investor confidence and an unsustainable drain on its foreign reserves. As economist David Felix described it, in the Fall of 1994 "Mexican tesobono holders began cashing in and exiting to dollars [this bond was payable in pesos but with pesos indexed to the dollar], followed belatedly by foreign holders, who were still stuck with $29 billion worth of tesobonos when in December 1994 the Mexican central bank, its dollar reserves nearly exhausted, let the exchange rate float and helplessly watched it sink. The U.S. Treasury and IMF hastily cobbled together a $51 billion bailout fund, and required the Mexican government to use over half to pay off the $29 billion tesobonos with dollars. Since the government's contractual obligation to tesobono holders was merely to pay them more pesos when the peso price of dollars rose, the bailout obligation amounted to a forced ex post rewriting of the contract with tesobono holders to save them from taking a bath" ("Why International Capital Mobility Should be Curbed, and How It Could Be Done," ICTFU, Dec. 2001).

In his chapter "Alan, Larry, and Bob Save the Privileged," Faux describes how in 1994 Greenspan, Summers, and Rubin helped create a climate of fear, telling Congress that "the entire world was now at risk." Governor George W. Bush of Texas was lauded by Rubin for "instinctively grasping what was at stake" and giving public support to the bailout. Rubin even "called Gingrich, who called Greenspan who called Rush Limbaugh to promote the bailout to the rightwing listeners of his radio show." In fact, the sales claims for the bailout were phony and the IMF financial contribution to the bailout was illegal. Mexico didn't suffer any "debt crisis" as it was only obligated to provide pesos, not dollars—the payment of dollars was forced on the Mexican government by U.S. officials, who persuaded the U.S. media that the dollar payments were required by the tesobono contracts. U.S. officials told this lie and required this payment of Mexico, not only to help U.S. investors, but also to dissuade Mexico from resorting to capital controls, which they could have done in accord with IMF rules, but which would have set a pattern in violation of the neoliberal principles being enforced on the Third World by the United States and IMF. Article 6 of the IMF Articles of Agreement not only would have allowed Mexican capital controls, it prohibits IMF emergency funding to facilitate capital flight—violated in this case in accord with U.S. demands and higher neoliberal principles (or rather interests).

Faux points out that the bailout money "was not used to rejuvenate the Mexican economy. It did not underwrite job creation for the unemployed or debt relief for the bankrupted small businesspeople or aid to hospitals and schools that were suddenly broke. It was used to make whole the Wall Street holders of tesobonos, who had originally bought the risky Mexican bonds because Salinas was giving them a high yield." Instead of capital controls Rubin and Summers insisted on budget reductions and "reform" of the Mexican financial system, which was followed by and resulted in the "steepest economic crash since the Great Depression." The Mexican middle class "was decimated" by the forced contraction and Mexican taxpayers eventually being forced to pay the bills for the bailout. Rubin claimed that this was all because "Mexico...had made a serious policy mistake." But Faux points out that "Mexico" didn't do this, but rather Salinas and his successor Zedillo, "both of whom 'Alan, Larry and Bob' had promoted to the American Congress as honest, competent reformers who had to be supported with NAFTA, even if it meant thousands of American losing their jobs."

Faux also points out that as part of NAFTA, and in the wake of the Mexican forced contraction and budget crisis, privatization of Mexican public assets was accelerated, and local oligarchs and foreign banks (and customers of Goldman Sachs) could now buy up assets at bargain prices. So the Party of Davos and its local comprador allies did very well at the same time as ordinary Mexicans were put through the wringer. As Faux says, "The NAFTA financial model—liberalization of trade and finance leading to a speculative bubble, a subsequent crash, and the protection of investors from the consequences of their own actions—was repeated in various forms in the 1990s throughout the global markets in Thailand, Brazil, Bolivia, South Korea, Indonesia, Russia and Argentina."

That was written in 2006. Now that the NAFTA financial model has hit home in the United States itself, we can see how the Party of Davos, with Goldman Sachs once again in the lead, is doing its darndest to continue to socialize risks for investors and pass off costs to ordinary citizens. And with Bob Rubin and Larry Summers waiting in the wings, the Democrats swallowing the latest bailouts, and Wall Street still funding the Party generously, we may have more of the same in a new Democratic administration.

http://zcommunications.org/zmag/viewArticle/19835

onsdag den 3. december 2008

Obama's Kettle of Hawks. --- "Change".

Barack Obama has assembled a team of rivals to implement his foreign policy. But while pundits and journalists speculate endlessly on the potential for drama with Hillary Clinton at the state department and Bill Clinton's network of shady funders, the real rivalry that will play out goes virtually unmentioned. The main battles will not be between Obama's staff, but rather against those who actually want a change in US foreign policy, not just a staff change in the war room.

When announcing his foreign policy team on Monday, Obama said: "I didn't go around checking their voter registration." That is a bit hard to believe, given the 63-question application to work in his White House. But Obama clearly did check their credentials, and the disturbing truth is that he liked what he saw.

The assembly of Hillary Clinton, Robert Gates, Susan Rice and Joe Biden is a kettle of hawks with a proven track record of support for the Iraq war, militaristic interventionism, neoliberal economic policies and a worldview consistent with the foreign policy arch that stretches from George HW Bush's time in office to the present.

Obama has dismissed suggestions that the public records of his appointees bear much relevance to future policy. "Understand where the vision for change comes from, first and foremost," Obama said. "It comes from me. That's my job, to provide a vision in terms of where we are going and to make sure, then, that my team is implementing." It is a line the president-elect's defenders echo often. The reality, though, is that their records do matter.

We were told repeatedly during the campaign that Obama was right on the premiere foreign policy issue of our day – the Iraq war. "Six years ago, I stood up and opposed this war at a time when it was politically risky to do so," Obama said in his September debate against John McCain. "Senator McCain and President Bush had a very different judgment." What does it say that, with 130 members of the House and 23 in the Senate who voted against the war, Obama chooses to hire Democrats who made the same judgement as Bush and McCain?

On Iraq, the issue that the Obama campaign described as "the most critical foreign policy judgment of our generation", Biden and Clinton not only supported the invasion, but pushed the Bush administration's propaganda and lies about Iraqi WMDs and fictitious connections to al-Qaida. Clinton and Obama's hawkish, pro-Israel chief of staff, Rahm Emanuel, still refuse to renounce their votes in favour of the war. Rice, who claims she opposed the Iraq war, didn't hold elected office and was not confronted with voting for or against it. But she did publicly promote the myth of Iraq's possession of WMDs, saying in the lead up to the war that the "major threat" must "be dealt with forcefully". Rice has also been hawkish on Darfur, calling for "strik[ing] Sudanese airfields, aircraft and other military assets".

It is also deeply telling that, of his own free will, Obama selected President Bush's choice for defence secretary, a man with a very disturbing and lengthy history at the CIA during the cold war, as his own. While General James Jones, Obama's nominee for national security adviser, reportedly opposed the Iraq invasion and is said to have stood up to the neocons in Donald Rumsfeld's Pentagon, he did not do so publicly when it would have carried weight. Time magazine described him as "the man who led the Marines during the run-up to the war – and failed to publicly criticise the operation's flawed planning". Moreover, Jones, who is a friend of McCain's, has said a timetable for Iraq withdrawal, "would be against our national interest".

But the problem with Obama's appointments is hardly just a matter of bad vision on Iraq. What ultimately ties Obama's team together is their unified support for the classic US foreign policy recipe: the hidden hand of the free market, backed up by the iron fist of US militarism to defend the America First doctrine.

Obama's starry-eyed defenders have tried to downplay the importance of his cabinet selections, saying Obama will call the shots, but the ruling elite in this country see it for what it is. Karl Rove, "Bush's Brain", called Obama's cabinet selections, "reassuring", which itself is disconcerting, but neoconservative leader and former McCain campaign staffer Max Boot summed it up best. "I am gobsmacked by these appointments, most of which could just as easily have come from a President McCain," Boot wrote. The appointment of General Jones and the retention of Gates at defence "all but puts an end to the 16-month timetable for withdrawal from Iraq, the unconditional summits with dictators and other foolishness that once emanated from the Obama campaign."

Boot added that Hillary Clinton will be a "powerful" voice "for 'neoliberalism' which is not so different in many respects from 'neoconservativism.'" Boot's buddy, Michael Goldfarb, wrote in The Weekly Standard, the official organ of the neoconservative movement, that he sees "certainly nothing that represents a drastic change in how Washington does business. The expectation is that Obama is set to continue the course set by Bush in his second term."

There is not a single, solid anti-war voice in the upper echelons of the Obama foreign policy apparatus. And this is the point: Obama is not going to fundamentally change US foreign policy. He is a status quo Democrat. And that is why the mono-partisan Washington insiders are gushing over Obama's new team. At the same time, it is also disingenuous to act as though Obama is engaging in some epic betrayal. Of course these appointments contradict his campaign rhetoric of change. But move past the speeches and Obama's selections are very much in sync with his record and the foreign policy vision he articulated on the campaign trail, from his pledge to escalate the war in Afghanistan to his "residual force" plan in Iraq to his vow to use unilateral force in Pakistan to defend US interests to his posturing on Iran. "I will always keep the threat of military action on the table to defend our security and our ally Israel," Obama said in his famed speech at the American Israel Public Affairs Committee last summer. "Sometimes, there are no alternatives to confrontation."

http://www.informationclearinghouse.info/article21373.htm