Friday, October 31, 2008

CIA officers could face trial in Britain over torture allegations

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By Robert Verkaik

Attorney General to investigate abuse claims

Senior CIA officers could be put on trial in Britain after it emerged last night that the Attorney General is to investigate allegations that a British resident held in Guantanamo Bay was brutally tortured, after being arrested and questioned by American forces following the terrorist attacks on New York and Washington in 2001.

The Home Secretary Jacqui Smith has asked Baroness Scotland to consider bringing criminal proceedings against Americans allegedly responsible for the rendition and abuse of Binyam Mohamed, when he was held in prisons in Morocco and Afghanistan.

The development follows criticism of US prosecutors by British judges who have seen secret evidence of torture committed against Mr Mohamed, including allegations his torturers used a razor blade to repeatedly cut his penis. The Attorney's investigation is expected to include allegations that MI5 colluded in Mr Mohamed's rendition. Mr Mohamed, 30, an Ethiopian national and British resident, was arrested in Pakistan in 2002, when he was questioned by an MI5 officer.

On Tuesday, Government lawyers wrote to the judges hearing Mr Mohamed's case against the UK government in the High Court. In the letter they said "the question of possible criminal wrongdoing to which these proceedings has given rise has been referred by the Home Secretary to the Attorney general for consideration as an independent minister of justice". Baroness Scotland has been sent secret witness statements given to the court and public interest immunity certificates for the proceedings.

Mr Mohamed, 30, accuses MI5 agents of lying about what they knew of CIA plans to transfer him to a prison in north Africa, where he claims he was subjected to horrendous torture. Mr Mohamed, who won asylum in the UK in 1994, has been charged with terrorism-related offences. He awaits a decision on whether he is to face trial at the US naval base. He is officially the last Briton at Guantanamo. Last night his lawyer, Clive Stafford Smith, said: "This is a welcome recognition that the CIA cannot just go rendering British residents to secret torture chambers without consequences, and British agents cannot take part in US crimes without facing the music. Reprieve will be making submissions to the Attorney General to ensure those involved, from the US, Pakistan, Morocco, Britain, are held responsible."

Richard Stein, of Leigh Day, representing Mr Mohamed in the High Court proceedings, said: "Ultimately the British Government had little choice once they conceded that a case had been made that Binyam Mohamed was tortured. The Convention Against Torture imposes an obligation on signatory states to investigate torture."

In August two judges ruled allegations of torture were at least arguable and that MI5 had information relating to Mr Mohamed that was "not only necessary but essential for his defence".

The judges have read statements and interviews with Mr Mohamed between 28 and 31 July, 2004 when he says he was forced to confess to terrorism. The judges said: "This was after a period of over two-and-a-half years of incommunicado detention during which Binyam Mohamed alleges he was tortured."

He was first held in Pakistan in 2002, where a British agent interrogated him; he was then sent to Morocco by the CIA and allegedly tortured for 18 months. He was rendered to the secret "Dark Prison" in Afghanistan, where his torture is alleged to have continued. Since September 2004, he has been in Guantanamo Bay.

GOP Voter Suppression: More Miss than Hit

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By Zachary Roth

Yesterday we posted a quick round-up of the various voter-suppression schemes being pushed by Republicans in swing states around the country. And after looking at the list, one thing quickly becomes clear: most of the efforts have failed.

There’s no one grand unifying theory for why that’s true.

In some cases, the courts have rejected GOP efforts to make voting harder:

  • In Indiana, for instance, a Superior Court judge declined to support a GOP bid to shut down early voting centers in Democratic-leaning cities in Lake County, and the state Supreme Court chose not to immediately intervene.

  • In Wisconsin, a suit brought by Republican Attorney General J.B. Van Hollen -- which he later admitted had been requested by the Republican Party -- seeking to force the state election board to re-confirm all newly registered voters was thrown out by a county court.

  • In Michigan, a federal appeals court today blocked the Republican secretary of state, Terri Lynn Land, from throwing 5,500 newly registered voters off the rolls because their registration cards were returned as undeliverable, after voting-rights groups sued.

In other states, Democratic state officials or voting-rights advocates have held the line:

  • In Nevada, Secretary of State Ross Miller denied a request from the state GOP to require voters to cast provisional ballots if they fixed mistakes in their voting information at the polls.

  • In Colorado, a bid by Republican Secretary of State Mike Coffman -- who himself is running for a seat in the U.S. House -- to purge 14,000 voters from the rolls was only partially successful. After voting-rights groups sued, a settlement was reached yesterday allowing the voters to cast provisional ballots. According to the Rocky Mountain News, those ballots would "be presumed to be valid unless state and county officials prove otherwise." A lawyer for the voting-rights groups called the deal "a win-win."

In still other places, it’s been a combination of both factors:

  • In Ohio -- perhaps the most high-profile example of voter-suppression this cycle -- the state GOP sued to force Secretary of State Jennifer Brunner to provide local election officials with the names of new voters whose registration information didn’t match other government documents. Brunner resisted, arguing, it appears correctly, that the information would be used to challenge large numbers of voters and cause chaos at the polls. The U.S. Supreme Court ultimately sided with Brunner. (The Department of Justice deserves some of the credit here, too, for declining a request by the White House to intervene.)

And in some states, the Republicans appear to have done themselves in through the sheer chutzpah of their behavior, and the resulting outcry:

  • In Montana, the state GOP announced plans to challenge 6000 voters in predominantly Democratic counties, based on discrepancies between in their listed addresses. But after even Republicans in the state denounced the ploy, the party backed off, and its executive director resigned.

  • In New Mexico, the state party held a press conference at which it released the names, and some personal information, of ten voters, almost all Hispanic, that it said had voted fraudulently in a Democratic primary in June. It was later established that they were all legitimate voters. The U.S. Department of Justice is now investigating reports by TPMmuckraker and others that a lawyer attached to the party sent a private investigator to the homes of some of these voters to question them about their voting status -- potentially violating federal voting laws.

Of course, that’s not to suggest that Republican suppression efforts haven’t been successful anywhere. In Florida, for instance, Secretary of State Kurt Browning, a Republican, has instructed election officials to reject voter registration applications that do not pass a computer match test. Voting-rights groups say the system can disqualify voters based on nothing more than a missing middle initial on their voter form. They fear the move could disenfranchise tens of thousands of legitimate voters. (Though even in the Sunshine State, there’s a bright spot. GOP governor Charlie Crist on Tuesday ordered extended hours for early voting centers, after long lines were reported in many parts of the state.)

Of course, the whole point of the voter-suppression game is to throw up as many gambits as possible, and hope that just a few succeed. And there’s no way to measure the effect that even the unsuccessful ploys have in generating cynicism about the process itself, and thereby reducing turnout, to Republicans’ advantage. So in a close election, it’s still possible that voter suppression could make the difference -- as it may well have done in 2000.

But it’s worth noting that -- thanks largely to Democratic control of the secretary of state’s offices in some key states; the skepticism with which many courts have looked on efforts to put obstacles in the way of voting; and the role of voting-rights groups and the press in exposing the bankruptcy of Republican claims -- the nationwide GOP voter-suppression effort appears to have been far less successful than the party might have hoped.

Not that we expect them to drop the tactic any time soon.

GOP launches voter suppression campaign while accusing ACORN of irregularity

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By Eric T. Campbell

Mike Cox levies six charges

With only days to go before the presidential election, Senator Barack Obama has increased his lead over Sen. McCain, according to most polls and pundits. Subsequently, the GOP has again turned to suppressing the minority vote.

By questioning the registration practices of community organizations, like the Association of Community Organizations for Reform Now (ACORN), much of the national debate has focused, critically, on voter registration applications accepted in Black and Latino neighborhoods across America.

Gross mischaracterizations and factual omissions characterize the assault, pushing ACORN into overtime to set the record straight about the registration process and its historic effort to increase voter participation.

Over the past year, ACORN has registered over 1.3 million voters whom are mostly Black and from urban regions.

“Not every application will be valid. In almost every case, ACORN has already identified those cards as suspicious,” David Lagstein, head organizer for Michigan ACORN, told the Michigan Citizen. “We actually flag and tag any card that is incomplete or suspicious.”

The major media has spent ample air time describing the fraudulent applications received by ACORN representatives without mentioning critical information regarding those few cases. At the same time, the Republicans have launched a national campaign to purge registration records in battleground states such as Michigan and Pennsylvania.

The now infamous Mickey Mouse, Jimmy Johns and Tony Romo registration examples being flaunted on the airwaves were all actually first brought to light by ACORN workers themselves.

Also, ACORN, like any third party voter registration drive, cannot legally throw away any voter registration cards. It flags suspicious cards and submits them to the appropriate state election authorities who make the final judgment.

Charles D. Jackson, national communications director for ACORN, explained to the Michigan Citizen that ACORN personnel call all voter registration applicants to confirm information and if persons can’t be reached, separate stacks are labeled questionable or incomplete.

“We do due diligence — we turn in cards and they have a process to verify individuals,” Jackson says. “The possibility of Mickey Mouse or Donald Duck being able to vote is nil.”

“This has been a coordinated strategy to attack ACORN as a way to discredit and rid of new and minority voters from the campaign,” Lagstein continues. “Anyone who looks at the facts will see that it doesn’t make sense.

But the tide is slowly turning as ACORN and voting rights advocates attempt to squeeze into the debate.

Former New Mexico U.S. Attorney David Iglesias, a Republican who was appointed by President George W. Bush, has spoken recently about the directions he received from the U.S. Justice Department during the legislative elections of 2006 — to go after ACORN for voter registration fraud. He and other U.S Attorneys were summarily dismissed after finding no evidence of fraud and refusing to prosecute trumped up charges.

In addition, strong statements supporting ACORN by members of the Congressional Black Caucus, the AFL-CIO, and national voting rights advocates like Robert Kennedy, Jr., have brought some balance to the debate.

A delegation of U.S. Congressmen and women, including Rep. John Conyers, have sponsored a written plea, dated Oct. 20, to Attorney General Michael Mukasky and F.B.I. Director Robert M. Mueller reprimanding the, “escalation of attacks on ACORN and others seeking to register and turn out voters.”

The letter details recent evidence of intimidation against ACORN staffers that may amount to “possible federal crimes such as criminal civil rights crimes including conspiracy to deprive the victims (and others) of federally protected constitutional rights, mail and wire offenses, and other more basic offenses such as assault and battery.”

“Our message is getting out there and is resounding,” says Jackson.

Here in Michigan, Attorney Mike Cox has levied six forgery charges against a former ACORN employee, Antonio Johnson of Jackson, Michigan, who is currently incarcerated on an unrelated parole violation.

David Lagstein says the Attorney General’s action may be appropriate and that ACORN has attempted to cooperate with the Attorney General’s office. But Lagstein adds that the timing is what is troubling. The forged cards in question were submitted to the City of Jackson Clerk’s Office in May and June. Cox requested the forgery information in September, according to a press release. But the Attorney General’s announcement describing the charges occurred in October, on the same day Sen. John McCain held a press conference admonishing ACORN.

Unclear is if those forged applications were already flagged by ACORN and if City of Jackson Clerk, Lynn Fessel, has requested the assistance of the Jackson Police Department on any other investigations involving registration applications. Johnson, 23, has been charged with six counts of forgery and faces up to 14 years for each count.

Attorney General media contact, John Sellek, was unavailable for comment.

The Triumph of Ignorance: How Morons Succeed in U.S. Politics

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By George Monbiot

How was it allowed to happen? How did politics in the United States come to be dominated by people who make a virtue out of ignorance? Was it charity that has permitted mankind's closest living relative to spend two terms as president? How did Sarah Palin, Dan Quayle and other such gibbering numbskulls get to where they are? How could Republican rallies in 2008 be drowned out by screaming ignoramuses insisting that Barack Obama is a Muslim and a terrorist?

Like most people on this side of the Atlantic, I have spent my adult life mystified by American politics. The United States has the world's best universities and attracts the world's finest minds. It dominates discoveries in science and medicine. Its wealth and power depend on the application of knowledge. Yet, uniquely among the developed nations (with the possible exception of Australia), learning is a grave political disadvantage.

There have been exceptions over the past century: Franklin Roosevelt, Kennedy and Clinton tempered their intellectualism with the common touch and survived; but Adlai Stevenson, Al Gore and John Kerry were successfully tarred by their opponents as members of a cerebral elite (as if this were not a qualification for the presidency). Perhaps the defining moment in the collapse of intelligent politics was Ronald Reagan's response to Jimmy Carter during the 1980 presidential debate. Carter -- stumbling a little, using long words -- carefully enumerated the benefits of national health insurance. Reagan smiled and said, "There you go again." His own health program would have appalled most Americans, had he explained it as carefully as Carter had done, but he had found a formula for avoiding tough political issues and making his opponents look like wonks.

It wasn't always like this. The founding fathers of the republic -- men like Benjamin Franklin, Thomas Jefferson, James Madison, John Adams and Alexander Hamilton -- were among the greatest thinkers of their age. They felt no need to make a secret of it. How did the project they launched degenerate into George W. Bush and Sarah Palin?

On one level, this is easy to answer: Ignorant politicians are elected by ignorant people. U.S. education, like the U.S. health system, is notorious for its failures. In the most powerful nation on Earth, 1 adult in 5 believes the sun revolves around the Earth; only 26 percent accept that evolution takes place by means of natural selection; two-thirds of young adults are unable to find Iraq on a map; two-thirds of U.S. voters cannot name the three branches of government; and the math skills of 15-year-olds in the United States are ranked 24th out of the 29 countries in the Organisation for Economic Co-operation and Development.

But this merely extends the mystery: How did so many U.S. citizens become so dumb and so suspicious of intelligence? Susan Jacoby's book The Age of American Unreason provides the fullest explanation I have read so far. She shows that the degradation of U.S. politics results from a series of interlocking tragedies.

One theme is both familiar and clear: Religion -- in particular fundamentalist religion -- makes you stupid. The United States is the only rich country in which Christian fundamentalism is vast and growing.

Jacoby shows that there was once a certain logic to its anti-rationalism. During the first few decades after the publication of Origin of Species, for example, Americans had good reason to reject the theory of natural selection and to treat public intellectuals with suspicion. From the beginning, Darwin's theory was mixed up in the United States with the brutal philosophy -- now known as Social Darwinism -- of the British writer Herbert Spencer. Spencer's doctrine, promoted in the popular press with the help of funding from Andrew Carnegie, John D. Rockefeller and Thomas Edison, suggested that millionaires stood at the top of a scala natura established by evolution. By preventing unfit people from being weeded out, government intervention weakened the nation, according to the doctrine; gross economic inequalities were both justifiable and necessary.

Darwinism, in other words, became indistinguishable to the public from the most bestial form of laissez-faire economics. Many Christians responded with revulsion. It is profoundly ironic that the doctrine rejected a century ago by such prominent fundamentalists as William Jennings Bryan is now central to the economic thinking of the Christian Right. Modern fundamentalists reject the science of Darwinian evolution and accept the pseudoscience of Social Darwinism.

But there were other, more powerful reasons for the intellectual isolation of the fundamentalists. The United States is peculiar in devolving the control of education to local authorities. Teaching in the Southern states was dominated by the views of an ignorant aristocracy of planters, and a great educational gulf opened up. "In the South," Jacoby writes, "what can only be described as an intellectual blockade was imposed in order to keep out any ideas that might threaten the social order."

The Southern Baptist Convention, now the biggest Protestant denomination in the United States, was to slavery and segregation what the Dutch Reformed Church was to apartheid in South Africa. It has done more than any other force to keep the South stupid. In the 1960s it tried to stave off desegregation by establishing a system of private Christian schools and universities. A student can now progress from kindergarten to a higher degree without any exposure to secular teaching. Southern Baptist beliefs pass intact through the public school system as well. A survey by researchers at the University of Texas in 1998 found that 1 in 4 of the state's public school biology teachers believed that humans and dinosaurs lived on Earth at the same time.

This tragedy has been assisted by the American fetishization of self-education. Though he greatly regretted his lack of formal teaching, Abraham Lincoln's career is repeatedly cited as evidence that good education, provided by the state, is unnecessary; all that is required to succeed is determination and rugged individualism. This might have served people well when genuine self-education movements, like the one built around the Little Blue Books in the first half of the 20th century, were in vogue. In the age of infotainment, it is a recipe for confusion.

Besides fundamentalist religion, perhaps the most potent reason why intellectuals struggle in elections is that intellectualism has been equated with subversion. The brief flirtation of some thinkers with communism a long time ago has been used to create an impression in the public mind that all intellectuals are communists. Almost every day, men like Rush Limbaugh and Bill O'Reilly rage against the "liberal elites" destroying America.

The specter of pointy-headed alien subversives was crucial to the elections of Reagan and Bush. A genuine intellectual elite -- like the neocons (some of them former communists) surrounding Bush -- has managed to pitch the political conflict as a battle between ordinary Americans and an overeducated pinko establishment. Any attempt to challenge the ideas of the right-wing elite has been successfully branded as elitism.

Obama has a good deal to offer America, but none of this will come to an end if he wins. Until the great failures of the U.S. education system are reversed or religious fundamentalism withers, there will be political opportunities for people, like Bush and Palin, who flaunt their ignorance.

Naomi Klein: Bailout = Bush's Final Pillage

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By Naomi Klein

In the final days of the election, many Republicans seem to have given up the fight for power. But that doesn't mean they are relaxing. If you want to see real Republican elbow grease, check out the energy going into chucking great chunks of the $700 billion bailout out the door. At a recent Senate Banking Committee hearing, Republican Senator Bob Corker was fixated on this task, and with a clear deadline in mind: inauguration. "How much of it do you think may be actually spent by January 20 or so?" Corker asked Neel Kashkari, the 35-year-old former banker in charge of the bailout.

When European colonialists realized that they had no choice but to hand over power to the indigenous citizens, they would often turn their attention to stripping the local treasury of its gold and grabbing valuable livestock. If they were really nasty, like the Portuguese in Mozambique in the mid-1970s, they poured concrete down the elevator shafts.

The Bush gang prefers bureaucratic instruments: "distressed asset" auctions and the "equity purchase program." But make no mistake: the goal is the same as it was for the defeated Portuguese -- a final frantic looting of the public wealth before they hand over the keys to the safe.

How else to make sense of the bizarre decisions that have governed the allocation of the bailout money? When the Bush administration announced it would be injecting $250 billion into America's banks in exchange for equity, the plan was widely referred to as "partial nationalization" -- a radical measure required to get the banks lending again. In fact, there has been no nationalization, partial or otherwise. Taxpayers have gained no meaningful control, which is why the banks can spend their windfall as they wish (on bonuses, mergers, savings...) and the government is reduced to pleading that they use a portion of it for loans.

What, then, is the real purpose of the bailout? I fear it is something much more ambitious than a one-off gift to big business -- that this bailout has been designed to keep pillaging the Treasury for years to come. Remember, the main concern among big market players, particularly banks, is not the lack of credit but their battered share prices. Investors have lost confidence in the banks' honesty, and with good reason. This is where Treasury's equity pays off big time.

By purchasing stakes in these institutions, Treasury is sending a signal to the market that they are a safe bet. Why safe? Because the government won't be able to afford to let them fail. If these companies get themselves into trouble, investors can assume that the government will keep finding more cash, since allowing them to go down would mean losing its initial equity investments (just look at AIG). That tethering of the public interest to private companies is the real purpose of the bailout plan: Treasury Secretary Henry Paulson is handing all the companies that are admitted to the program -- a number potentially in the thousands -- an implicit Treasury Department guarantee. To skittish investors looking for safe places to park their money, these equity deals will be even more comforting than a Triple-A rating from Moody's.

Insurance like that is priceless. But for the banks, the best part is that the government is paying them -- in some cases billions of dollars -- to accept its seal of approval. For taxpayers, on the other hand, this entire plan is extremely risky, and may well cost significantly more than Paulson's original idea of buying up $700 billion in toxic debts. Now taxpayers aren't just on the hook for the debts but, arguably, for the fate of every corporation that sells them equity.

Interestingly, Fannie Mae and Freddie Mac both enjoyed this kind of unspoken guarantee. For decades the market understood that, since these private players were enmeshed with the government, Uncle Sam would always save the day. It was the worst of all worlds. Not only were profits privatized while risks were socialized but the implicit government backing created powerful incentives for reckless investments.

Now, with the new equity purchase program, Paulson has taken the discredited Fannie and Freddie model and applied it to a huge swath of the private banking industry. And once again, there is no reason to shy away from risky bets -- especially since Treasury has not required the banks to give up high-risk financial instruments in exchange for taxpayer dollars.

To further boost confidence, the federal government has also unveiled unlimited public guarantees for many bank deposit accounts. Oh, and as if this wasn't enough, Treasury has been encouraging the banks to merge with one another, ensuring that the only institutions left standing will be "too big to fail." In three different ways, the market is being told loud and clear that Washington will not allow the country's financial institutions to bear the consequences of their behavior. This may well be Bush's most creative innovation: no-risk capitalism.

There is a glimmer of hope. In answer to Senator Corker's question, Treasury is indeed having trouble dispersing the bailout funds. It has requested about $350 billion of the $700 billion, but most of this hasn't yet made it out the door. Meanwhile, every day it becomes clearer that the bailout was sold on false pretenses. It was never about getting loans flowing. It was always about turning the state into a giant insurance agency for Wall Street -- a safety net for the people who need it least, subsidized by the people who need it most.

This grotesque duplicity is an opportunity. Whoever wins the election on November 4 will have enormous moral authority. It can be used to call for a freeze on the dispersal of bailout funds -- not after the inauguration, but right away. All deals should be renegotiated immediately, this time with the public getting the guarantees.

It is risky, of course, to interrupt the bailout. The market won't like it. Nothing could be riskier, however, than allowing the Bush gang their parting gift to big business -- the gift that will keep on taking.

Attorney general's private trips have cost taxpayers

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By Marisa Taylor

Attorney General Michael Mukasey has taken personal trips on government jets almost every weekend since he took office less than a year ago at a cost to taxpayers of more than $155,800, Justice Department and Federal Aviation Administration travel records show.

Mukasey took so many trips to his home in New York on FAA, FBI or Drug Enforcement Administration planes that he was outside Washington a third or more of February, May, July, August and September. From November 2007 to September 2008, he traveled to New York 45 times, according to the records, which were released in late October in response to open records requests that McClatchy filed nine months ago.

Justice Department officials defended Mukasey's personal travel, saying that he has no choice but to fly on a government plane to see his family. Mukasey, unlike most other Cabinet members, is required to fly on government planes, rather than commercial ones, for security reasons, and he often worked from home, the officials said.

"When he travels personally, the attorney general pays what any other government official would pay for a commercial flight to that location," Justice Department spokesman Peter Carr said in a statement. "It would be unfair to penalize financially the attorney general because he is one of the few government officials required to use government aircraft for all travel."

Mukasey traveled with his wife on 17 of the trips, and eight of them were with four or five other relatives. Most of the trips with his wife and other relatives were one-way between New York and Washington.

Mukasey reimbursed the government a total of $15,246 for all of his trips, based on round-trip coach fares, as he's required to do by government travel regulations. However, the cost of operating the Gulfstream G5s, Cessna Citations and de Havilland Dash 8-100s that Mukasey uses is tens of thousands of dollars more.

For example, the attorney general reimbursed the Justice Department $128.80 for a round-trip ticket to New York. The actual cost to the government, according to the department: $4,021.32.

In February, Mukasey flew to Orlando, Fla. with his wife and four other relatives. Under travel regulations, officials who are required to travel by government aircraft are permitted to take relatives with them as long as they reimburse the taxpayers for the equivalent coach fare, which Mukasey did, officials said. For that trip, he paid $2,173. The actual cost to the government, according to the Justice Department: $12,250.

Mukasey's personal trips appear to outpace those of other officials who are required to travel on government jets.

During the same time period, Defense Secretary Robert Gates took fewer than six personal trips, and he also reimbursed the government at coach fares. The Pentagon refused to release the details of the secretary's personal travel, but spokesman Bryan Whitman said that, "you can count on one hand" the number of personal trips Gates took in fiscal 2008.

Homeland Security Secretary Michael Chertoff, who became one of the few officials required to fly on a government plane in 2004, didn't appear to have taken any personal trips in the last fiscal year, according to FAA records. His staff said he's taken about three personal trips a year during his four-year tenure and also has reimbursed the government for them at coach fare.

"The Secretary is on call 24 hours a day, seven days a week," wrote Laura Keehner in an e-mail response. "There is no time for frivolous trips when you are the Secretary of the Department of Homeland Security."

All members of Congress used to fly commercial. But after the 9/11 attacks, the Bush administration authorized the speaker of the House of Representatives, who follows the vice president in the line of succession, to fly on military planes when they're available for official business.

A congressional official said that last year Democratic House Speaker Nancy Pelosi took 17 trips to her district on military planes. Pelosi isn't required to reimburse the taxpayers because such travel is considered official. The official asked to remain anonymous because such information isn't readily available to the public and Congress is exempt from open-records laws.

Last year, Pelosi was criticized because the House Sergeant at Arms requested a larger military aircraft for her trips to her district in California. House officials said the request was made so her plane wouldn't have to refuel.

Mukasey took the helm of the Justice Department in November 2007, after his predecessor, Alberto Gonzales, resigned during the U.S. attorney firing scandal. Before he accepted the nomination, Mukasey told White House officials that he intended to spend as much time with his family in New York as the job allowed, Carr said.

Mukasey's wife has remained in New York rather than relocating to Washington because he expected to serve as attorney general for only a short time. He's been married for more than 30 years and has two grown children and grandchildren, whom he also visits.

Although he's said to travel frequently to see his family in New York, his wife and several other family members occasionally have traveled with him from Washington to New York. Carr said that's because his wife at times travels to Washington on commercial flights to attend official events and then returns with him to New York. Carr declined to release the identity of the other relatives, but FAA records show that his adult son, daughter, son-in-law and grandchildren have flown with him.

In addition to the government's estimated cost, the government pilot sometimes returned to Washington without passengers after dropping the attorney general off. When Mukasey was ready to return to Washington, the pilot flew an empty plane back to New York to pick him up.

Although FAA records indicate that its pilots routinely flew an empty plane between New York and Washington to pick up or drop off Mukasey, Justice Department records don't document how often this occurred, if at all, on FBI planes.

Paul Orfanedes of the government watchdog group Judicial Watch said that Mukasey's personal travel appears excessive.

"Taking personal trips almost every weekend, at substantial cost to taxpayers, seems like an abuse of the privileges of office," said Orfanedes, who heads Judicial Watch's Litigation Department, which has sued both Democratic and Republican administrations for information under open-records laws.

Although Danielle Brian, the executive director of the Project on Government Oversight said she was "torn" about how to view Mukasey's personal travel because she said the policy that requires him to fly on a government aircraft makes sense, she added that, "He should be sensitive to the fact that it costs taxpayers enormously.

"I applaud his interest in his family, but that should not be at our expense."

As a federal judge in New York, Mukasey was criticized with another judge for the cost of his long-term security detail. Both judges had 24-hour security that cost as much as $6 million a year, including about $20,000 in rent paid annually to each judge because the security officers stayed in their homes.

Mukasey presided over several terrorism trials, raising security concerns, but after a group of U.S. marshals filed a complaint alleging that they were required to perform personal chores for the judges and their families, the security detail stopped. Justice Department officials declined to answer questions about the cost of Mukasey's current security detail, citing concerns for his safety.

Most government officials, such as the head of the FAA, are prohibited from taking personal trips on government planes. When those officials travel on official business, they're required to fly commercial in coach class unless they're traveling internationally, cannot find an appropriate commercial flight or can demonstrate that the cost of flying on a government plane saves taxpayers money.

Last year, for instance, Transportation Secretary Mary Peters flew commercial on 25 out of 42 trips she took on official business, according to travel records. To avoid any appearance of impropriety, she declines upgrades to business or first class, her staff said.

The Government Accountability Office, Congress' investigative and research arm, last reviewed travel by an attorney general in 1990 and reported that then-Attorney General Dick Thornburgh had taken three personal trips in one year. GAO researchers recommended that the Justice Department and the FBI consider leasing a plane for all of the attorney general's travel because the FBI might be able to use its aircraft more often for investigative missions or get rid of planes it didn't need. Carr said the Justice Department considered the idea, but decided against it for cost and security reasons.

At times, government travel controversies have prompted administrations to tighten regulations. After the GAO found last year that government employees had inappropriately traveled by first class or business class at a cost of $146 million, the Bush administration ordered agencies to improve oversight of first class and business travel.

In 1991, President George H.W. Bush overhauled travel rules after revelations that then-White House Chief of Staff John H. Sununu had taken more than 70 trips on Pentagon planes over two years and miscategorized some personal or political trips as official. Amid the controversy, he also had a government driver take him to New York to buy rare stamps. Sununu, already unpopular within the Bush administration, eventually resigned.

U.S Gap Between Rich and Poor Widening!

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By Bob Kendall

Now that the U.S.A. has discovered that only Mexico and Turkey had poverty rates higher than the 30-country study by the Organization for Economic Cooperation and Development, what if anything will be done to help the U.S. poor obtain health care?
Politicians, during campaigns, loudly proclaim "The U.S.A. is the greatest nation on earth and the richest."

With the largest, almost incomprehensible national debt in the world, exceeding all prior national debts combined since the U.S. was founded, recent political rants have avoided claiming the U.S.A. to be the richest nation in the world! However, the persistent claim to greatness has been much used in the current election campaigns (rest assured).

Mary Reynolds-Gilmore of Northport, N.Y. in her October 24 Letter to the Editors of the New York Times hit the problem of U.S. health care precisely, stating:

"The problem is cost and access. We will never be first until all Americans have basic health care, health and malpractice executives stop pocketing such a high percentage of our premiums, and we institute a system of medical-specialist juries to control the malpractice frenzy. More money for evidence-based research is not the answer."
Stanley R. Bermann of Santa Fe, New Mexico had this to say in his letter of the same day to the Times:

"What needs to happen is that we have a universal health care program for all Americans. Nothing else will do!

"No American should have to suffer medically and then suffer financially."

Bruce Leff of Baltimore, also writing the same day in the Times, is an Associate Professor of Medicine at John Hopkins University School of Medicine. He explains succinctly:

"The evidence base for most interventions in medicine is lacking, especially so in the area of how to deliver quality care to the most costly patients, the elderly with multiple chronic conditions.

"Improvements in the evidence will be ineffective if they come in the absence of health care payment reform that obliterates the perverse incentives that favor specialty care and glitzy idolatry over diligent primary care and care coordination.

"A vast overhaul of medical education must be aligned with any reforms to achieve success."

This professor's opinion reflects a recent survey of students entering the schools of medicine at U.S. universities, where only 2% wanted to become primary care physicians. The reason? Because the specialty fields of medicine pay much more.

John McCain's much vaunted health care plan is almost amusing if it wasn't so absurd. The Republican health care plan allows a $5,000 tax consideration for health insurance. With almost all health insurance policies $12,000 top $15,000 a year, that doesn't help very much. But even worse is the accompanying nonsense of having to pay taxes on any health insurance coverage supplied by one's place of employment.

After hearing for years the boast about the U.S.A. being the richest nation in the world, possibly the recent survey of 30 nations by the Economic Cooperation and Development study, placing the U.S. above only Mexico and Turkey will bring us down to earth.

Arnold S. Cohen, president of Partnership for the Homeless in New York City in his October 23 letter to the Times touches base with reality:

"During these fragile and uncertain economic times, we'll certainly be seeing thousands upon thousands more people teetering on the precipice, falling into homelessness.

"Just think back to the days of the 2001 economic slump when homelessness in New York City dramatically increased.

"By the fall of 2003, more than 16,000 children were living in homeless shelters.

"The shrinking economy will undoubtedly mean less public financing for critical services and fewer jobs for our neighbors in need. But deep budget cuts -- which may appear on their face prudent -- have historically proved to be fiscally unwise.

"It only manages to push people further into poverty and homelessness, costing taxpayers millions more."

While 45 million Americans lack health care coverage, this Republican-led administration goes on spending $10 billion a month in Iraq. Meanwhile on the business front, U.S. CEO's have the highest salaries in the world!

Many voters caught unawares by Florida's 'no-match' ID law

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By Curtis Morgan and Charles Rabin

What do a promising rookie for the Miami Heat, a systems analyst from Bulgaria, the wife of a Republican congressional candidate and Fidel Castro have in common?

They can’t just show up Nov. 4 and fill out a regular ballot. Theirs are among 12,000 names statewide flagged under Florida’s Voter Verification Law, a ’’no match’’ screening process embroiled in legal and political controversy.

The ID check spits out voter registrations that don’t match driver’s license or social security records. It has left voters on a list dominated by blacks, Hispanics and Democrats in a legal limbo — unless they supply elections officials with additional proof they are who they say they are.

More than one-third of the people on the ’’no match’’ list live in Miami-Dade or Broward counties -- most notably Mario Chalmers, a Heat guard who starred in last year’s Final Four college basketball championships.

Chalmers, who grew up in Alaska and played in Kansas, said his father successfully sorted out the ID mess.

’’All I have to do is go vote,’’ he said, "so that made it easier for me.’’

The process has not been such a breeze for everyone. A Miami Herald survey of 50 no-match voters showed that more than a third didn’t know the list, or law, even existed.

Read the full story at

Ecuador alleges 'clear' signs of CIA infiltration

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An Ecuadorean presidential commission has concluded that U.S. intelligence services infiltrated the Andean nation's military and police and supported a cross-border incursion by Colombian troops that killed a top rebel commander.

Following the attack on a Revolutionary Armed Forces of Colombia camp inside Ecuador on March 1, President Rafael Correa accused the CIA of infiltrating his nation's intelligence services and appointed a commission to investigate.

The body alleged in its report, made public Thursday, that the CIA bought information from Ecuador's military and had prior knowledge of the raid, said Defense Minister Javier Ponce, who read highlights of the findings to reporters.

No one at the U.S. Embassy was immediately available to comment.

"The CIA had full knowledge of what was happening," the commission's report said.

It cited as evidence an alleged phone call from the CIA announcing the attack to an unidentified person in Ecuador; purported calls from a former colonel in Ecuador's military intelligence to Colombian intelligence services; and the arrival of a CIA airplane at a U.S. anti-drug base in Ecuador in late February.

The report also said that a special unit of Ecuador's police was "practically financed and controlled by the U.S. Embassy."

Interior Minister Fernando Bustamante said Ecuador would "carefully review all of its agreements" with the United States following the report.

Ecuadorean officials have said previously that the government would not break off relations with Washington over the alleged CIA infiltration.

Pro-Palestinian boat lands in Gaza Strip

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By Ashraf Khalil

Activists continue a campaign to break Israel's blockade on the territory. A showdown at sea is averted.

Reporting from Jerusalem — A boatload of pro-Palestinian activists landed on the shores of the Gaza Strip on Wednesday, the latest move in a campaign to defy Israeli restrictions on access to the territory.

A potential showdown at sea was averted at the last minute when the Israeli government abruptly backed down from threats to intercept the 66-foot yacht.

"Last night at the highest level, a reverse decision was taken," said Foreign Ministry spokesman Yigal Palmor. The ultimate choice, he said, was made by Prime Minister Ehud Olmert.

The yacht Dignity arrived from Cyprus carrying medical supplies and 27 passengers, including a Nobel Peace Prize winner. Their journey continued a campaign launched in August, when a pair of ships first made the Cyprus-Gaza run.

"I think we're right at the point where [the boat campaign] stops being symbolic and begins to seriously weaken the Israeli siege," said Palestinian Authority parliament member Mustafa Barghouti.

Palmor downplayed the significance of the campaign, saying that the welcoming crowds Wednesday were significantly smaller than in August.

Several boats full of flag-waving Gazans escorted the Dignity to shore. The visitors later met with deposed Palestinian Prime Minister Ismail Haniyeh, a leader of the militant group Hamas, which won parliamentary elections in January 2006 and seized control of the Gaza Strip from the Fatah faction in the summer of 2007 after a short-lived unity government collapsed. Fatah continues to control the Palestinian Authority, but rules only over the West Bank.

Barghouti hailed the day's journey as a victory for those who seek to peacefully undermine the Israeli blockade on Gaza.

"Hopefully it shows all groups, including Hamas, the effectiveness of nonviolent resistance," Barghouti said after meeting with Haniyeh.

Israel, with U.S. backing and Egyptian assistance, virtually sealed the narrow, densely populated coastal ribbon after the Hamas takeover. Limited humanitarian shipments are allowed in, and almost nothing is allowed out.

Israel and Hamas are observing a truce. Hamas has restrained its cadres from the rocket launches that used to plague Israeli border towns, and Israel has increased the flow of humanitarian goods. But the Gazan economy remains frozen and almost entirely dependent on goods smuggled through tunnels from Egypt.

"The government of Israel cannot cut off Gaza forever. We will come again and again," said longtime Palestinian rights supporter Mairead Corrigan Maguire, who won the 1976 Nobel Peace Prize for her work with Catholics and Protestants in Northern Ireland.

In August, when the two boats were permitted to land unhindered, Israeli officials said they were denying the activists the confrontation they desired. This time Israeli took a harder line. When the Dignity left Cyprus on Tuesday, Israeli officials flatly stated that the boat would be intercepted.

But Olmert, who resigned weeks ago but remains in a caretaker role until new elections can be held early next year, changed his mind Tuesday night.

Oil company bonanza continues with record profits for Shell and Exxon

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By Mark Milner and Andrew Clark

Royal Dutch Shell and Exxon Mobil join BP in reaping benefits from high price of crude oil

Royal Dutch Shell and Exxon Mobil emulated BP today by revealing record quarterly profits.

Royal Dutch Shell, the biggest oil company in Europe, beat City expectations with third-quarter current-cost-of-supply profits — which strip out unrealised inventory gains and losses — up 74% to $10.9bn (£6.7bn).

Exxon Mobil, the world's largest oil company, smashed its own record for the highest quarterly earnings by a US firm by delivering a profit of $14.83bn.

Despite the better-than-expected figures, Royal Dutch Shell shares fell more than 3%, in part because of lower-than-expected production.

"Overall, this is a good outcome," said Tony Shepard, an analyst at stockbroker Charles Stanley. "But some investors will be disappointed by the sluggish production volumes."

Shell said it had benefited from higher oil and gas prices. Crude prices were more than 50% higher and gas realisations were about 48% ahead of the same quarter last year.

Oil prices have fallen by about half from their peak in July when they reached $147 a barrel but the continued scale of oil company profits have prompted calls for lower prices for consumers and the imposition of a windfall tax.

"We are steering the Shell ship through rough waters and so far OK," said the chief executive, Jeroen van der Veer. "Yes, we are generating large profits. Yes, we have the largest investment programme in Shell's history to create value for shareholders and to play our part in providing safe and cost competitive energy for consumers."

He said that, as well as its investment programme to secure energy supplies, his company's strategy remained to pay "competitive and progressive dividends".

The combination of a commitment to investment and dividend pay-outs
echoed BP's response this week to questions about the scale of its earnings.

Chief financial officer Peter Voser, who will take over from Van der Veer next summer, said the company was on track to reach its target of asset sales of $5bn this year, although he acknowledged the credit crunch was curbing the number of buyers.

"We are in no rush to sell assets. It's not a fire sale," he said.

Like Shell and BP, Exxon benefited from the high price of crude oil. Its profits amounted to $162m a day or $113,000 a minute, despite disruption caused to offshore production in the Gulf of Mexico by two hurricanes — Gustav and Ike.

"Despite the continuing uncertainty in world financial markets, ExxonMobil has maintained a strong financial position," said the chairman, Rex Tillerson. Capital investment of $19.3bn this year had made "a substantial contribution to employment and economic activity in the countries in which we operate," he said.

The figures are likely to raise hackles among critics of the oil industry. Exxon's previous quarter yielded profits of $11.6bn, which was itself a US record.

The presidential candidate Barack Obama branded the company's earnings as "outrageous" at a time when US motorists were "paying record prices at the pump".

Exxon has been attacked by the environmental movement for its reluctance to invest in alternative energy sources. At the company's annual meeting in May, a significant minority of investors backed resolutions demanding limits on the company's greenhouse gas emissions and a shift towards renewable energy.

The Texas-based company's upstream businesses, comprising exploration and production, enjoyed a 48% surge in earnings to $9.35bn as commodity prices soared, despite an 8% fall in output. Downstream, Exxon's refineries saw profits rise by $1bn to $3.01bn.

The figures comfortably beat analysts' expectations and Exxon's shares rose in early trading on Wall Street.

"US downstream was up from last year, so that was a positive surprise," said Gene Pisasale, an energy analyst at PNC Capital Advisers. "They have the strongest balance sheet in the business."

Army and Agency Will Study Rising Suicide Rate Among Soldiers

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Conceding it needed outside help in figuring out why the suicide rate among service members was rising, the Army announced plans on Wednesday to collaborate with the National Institute of Mental Health in an ambitious five-year project to identify the causes and risk factors of suicide.

The Army will make thousands of soldiers available to researchers for interviews and will provide access to its many databases, including those with medical, personnel, criminal and deployment histories. Researchers will draw from a cross section of the Army and will include soldiers who have just joined the service or are training for war and those who have returned from war.

Rather than wait until the study is completed, the National Institute of Mental Health will provide the Army with new information as researchers find it in the hopes of preventing soldier suicides.

Peter Geren, the secretary of the Army, described the five-year, $50 million study as a “landmark undertaking” modeled after the Framingham Heart Study. That influential study looked at heart health over a long period of time among a large group of participants who had not yet developed symptoms or suffered a heart attack.

“The goal is to build resiliency and to prevent suicide,” said Mr. Geren, who approached the National Institute of Mental Health with the idea to partner on the project.

Suicides in the Army have been climbing since the 2003 invasion of Iraq. In 2007, 115 soldiers killed themselves, a rate of 18.1 per 100,000 people, or 1 percent lower than the civilian rate.

Of the 115, 36 soldiers killed themselves while deployed overseas, 50 had deployed at some point before the act and returned, and 29 had never deployed. Only a fraction had a prior diagnosis of post-traumatic stress disorder.

The pace of suicides by soldiers in 2008 could eclipse last year’s. As of August, the number stood at 62 confirmed cases in the Army. An additional 31 deaths appear to be suicides and are under investigation.

Dr. S. Ward Cassells, assistant secretary of defense for health affairs, said the Army was familiar with the most common triggers: marital or relationship problems, poor job performance, feelings of failure on the battlefield and alcohol or drug abuse. Yet, in half the cases, Dr. Cassells said, the Army cannot figure out why the suicide occurred.

“We’ve reached a point where we do need some outside help,” Dr. Cassells said. “We’ve learned a lot. We’ve also learned we don’t understand it all.”

Dr. Thomas R. Insel, director of the National Institute of Mental Health, said researchers would study, among other things, the role that combat and multiple deployments play in suicide. They will conduct follow-up surveys of soldiers to show how risk factors evolve over time and shift their focus, as they see fit, depending on what they find. The study also will look at existing treatments and gauge their effectiveness.

The findings could be far-reaching not just for the Army but for civilians, as well, Dr. Insel said.

“The Army really is a microcosm of the nation,” he said.

More than 3,000 registered Coloradans barred from voting

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By Naomi Zeveloff

Thousands of Coloradans have been denied the right to vote because of a policy that may violate federal law.

Colorado Secretary of State Mike Coffman has authorized county clerks to purge newly registered voters under the so-called 20-day rule. Here, county clerks must send non-forwardable letters to newly registered voters. If the mail bounces back to the clerks, then they must remove the voter applicants’ names from the rolls.

Voting rights advocates say that the policy violates the 1965 National Voting Rights Act. The Advancement Project, a voter protection organization, filed suit on behalf of several other groups against Coffman to halt the practice and reverse course on other voter purges. According to the suit, 3,291 of these 20-day applicants have been removed since August 2007.

“We consider these voters to have been registered when they are entered into the SCORE database,” Jenny Flanagan, executive director of Colorado Common Cause told the Colorado Independent, referring to the state’s new voter database. “They have met the other requirements for registrations and they are taken off when the cards are returned. There are examples of when there could have been an error.”

Individuals ejected by the 20-day rule are among the 30,000 purged voters that make up the basis of the lawsuit. According to the complaint, Coffman also canceled duplicate registrations and registrations of people who moved. The NVRA specifies that the state may only cancel three types of voters within 90 days of a federal election: deceased people, felony convicts, and those who withdraw their own names.

Flanagan, who is also a plaintiff in the case, says that the 20-day rule is subject to human fallacy. A would-be voter might make a mistake on his or her own address on the form. But so could a registrar at the clerk’s office when entering the data. Postal employees aren’t immune to slip-ups either.

“We believe that it should not be allowed any time,” she says. “There are efforts to protect voters during this election, but there are some long term solutions we are seeking. We want to end this practice of canceling registrations and get the state in compliance with the NVRA.”

The NVRA does allow for voters to be removed from state rolls, but only after county clerks have sent a forwardable mail confirmation and waited two election periods to see whether the voters shows up to vote, according to Sarah Brannon, staff attorney with the Fair Elections Legal Network, a group acting as legal counsel on the lawsuit. “[Applicants] can’t be removed within 20 days,” she says.

Brannon says that the 20-day rule doesn’t disproportionately affect one population or another. But a Colorado Independent report published earlier this month showed that homeless people in particular are impacted by the legislation. Many homeless voters register using shelters or day centers as their mailing address. Counties send confirmation forms to these locations. But if homeless people don’t turn up within a week or two to pick up the mail, shelters typically return it to the sender. Which means that the homeless individuals are struck from the rolls.

Colorado isn’t the only state with a 20-day rule on the books. In Michigan, the American Civil Liberties Union and the Advancement Project — the same group bringing forward the suit in Colorado — successfully challenged a similar law; the state was ordered to stop purging voters whose confirmation cards were returned to county clerks.

The case will be heard on Wednesday afternoon.

Coffman’s office did not return repeated requests for comment. He has defended his purges in the past; Attorney General John Suthers has also backed Coffman, saying that the cancellations did not violate the NVRA.

Evidence grows that UK is entering a sharp recession

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By Julie Hyland

"In recent weeks, the global banking system has arguably undergone its biggest episode of instability since the start of the first world war," the Bank of England's bi-annual Financial Stability Report released this week states.

Total losses as a result of the global financial crisis will reach some £1.8 trillion ($2.8 trillion), the Bank forecast. This is three times the UK's annual public spending bill, 36 times the amount spent on aid to the developing countries and enough to provide for all the basic requirements—health, food, education and basic infrastructure—for 3 billion of the world's poor.

According to the bank, losses in the US have reached £1 trillion ($1.58 trillion). Losses among UK financial institutions total £122.6 billion so far, while losses in the euro zone area have risen to €784.6 billion (£625 billion).

Commenting on the report, which he said was not for "those of a nervous disposition", the BBC's Robert Peston noted the Bank's estimate "that £5,000 billion has implicitly or explicitly been made available by central banks and governments since April 2008 to support wholesale funding by banks," which is "equivalent to about a sixth of the total annual economic output of the whole world".

Even so, the Bank warned that measures such as the UK's £500 billion bailout were only a temporary palliative.

Britain's six largest financial institutions could lose up to £130 billion over the next five years, with the Bank stating that "even after accounting for recently announced capital-raisings which the UK government will help underwrite, the largest UK banks would need to shed around one-sixth of total assets to reduce leverage back to, say, 2003 levels."

"Risks remain in the financial system," it stated, noting fears over the stability of emerging economies, the balance sheets of insurance companies, and the fragility of the commercial property markets.

The financial crisis was "rooted in weaknesses within the financial system that developed during an extended global credit boom: rapid balance sheet expansion; the creation of assets whose liquidity and credit quality were uncertain in less benign conditions; and fragilities in funding structures," the report continues.

The Bank's own figures bear this out. In 2001, the level of lending by UK banks to customers was equal to deposits but by 2008, they had lent out £700 billion more than they held. The value of lending to UK households rose from approximately 60 percent of GDP in 1998, to some 90 percent in 2007. Mortgage loans at 3.5 times income grew from 10 percent of homebuyers in 2004 to 35 percent four years later.

The result is that the ratio of household debt to annual disposable income is 170 percent in the UK, compared to around 140 percent in the US, and an average of approximately 100 percent in Western Europe. Total mortgage, loan and credit debt stood at £1.44 billion in June 2008, outstripping the UK's GDP.

Yet the Bank goes on to claim that "few predicted" these "weaknesses" would cause "such dislocation in the global financial system."

If the Bank, and the government, were unprepared for events it was in part because they were completely taken in by their own propaganda eulogising the triumph of the "free market". Only last year Brown proclaimed that a "new Golden Age" had begun, thanks to the "high value-added, talent-driven" City of London. But more fundamentally, a tiny layer of the super-rich were doing extremely well out of the huge profits generated by collateralized debt obligations, credit default swaps and the like, despite their being based on a mountain of debt backed by virtually no real value.

It is the interests of this layer that have determined social and economic policy over the last two decades. And despite this having created what Charles Bean, the Bank's deputy governor, has said is "possibly the largest financial crisis of its kind in human history" the concerns of this financial oligarchy continue to determine official policy.

The last week saw £90 billion wiped off the FTSE 100 index, and the pound suffering a 10 percent fall against the dollar, to $1.53. Nick Parsons, from National Australia Bank, forecast that the pound could be as low as $1.40 by early 2009. "We will go down further because the problems the UK faces are worse than other countries. We are uniquely exposed because of the sheer amount of debt we've got," he said.

Official figures also showed a sharp contraction in GDP—down by 0.5 percent in the July to September period—the first fall in 16 years. The decline is particularly significant as it concerns the period prior to the onset of the financial meltdown of the last weeks. "It's a big shock that the decline is so large. It is truly dire," said Philip Shaw, chief economist at Investec.

Peter Mandelson, the business secretary, was just as blunt during a trade visit to Russia. The UK faced an "unparalleled financial crisis," he said. "I don't think people have realised what the impact is going to be on our real economy, on businesses and jobs back home."

The scale of the crisis has caused an apparent volte-face in ruling circles. After more than a decade in which it has denounced any "interference" in the free market, and championed "light-touch" regulation, the Labour government is now involved in one of the largest state interventions anywhere in Europe.

In addition to the £500 billion bailout, which does not include some £100 billion extended to Northern Rock, the government is to bring forward capital spending programmes in an effort to "kick-start" the economy. This week the government signalled that it would tear up its so-called 40 percent "golden rule" on public sector borrowing, introduced by Gordon Brown as chancellor in 1997 as proof of New Labour's break with its reformist past.

Without a trace of embarrassment, Alistair Darling, chancellor of the exchequer, told an audience at the Cass Business School on Wednesday, "Just as markets change, so should policy. Today, governments all over the world are using approaches that had until recently been consigned to policymaking history, but it is natural that the conduct of policy should evolve."

"Flexible" rules could enable government to borrow up to £3,225 for every person in the country; with some predicting government borrowing could reach £110 billion by 2011.

The plan caused ardent New Labour supporter, the Guardian's Polly Toynbee, to excitedly exclaim that an "epic ideological battle has begun."

It was "Keynesian versus neo-conomist in the battle for Britain's future", she claimed, referring to Conservative criticism of the plan and opposition to the government's abandonment of "laissez-faire" from a group of 16 economists in a letter to the Sunday Telegraph.

"This is Labour's great chance to show what good government can do to save people in time of need," she said, while warning that "Labour would be rash to think pro-Keynesianism was a done deal."

In reality, the proposal bares no resemblance even to the limited reforms of the New Deal introduced by Franklin Roosevelt in 1933. Little concrete detail is currently available as to what will constitute the speeded-up public sector projects, which at any rate are heavily dependent on private finance. And both Brown and Darling have made clear that they will ensure any borrowing is swiftly reduced as soon as economic conditions allow.

Moreover, the move has the backing of significant sections of big business, which recognise it as an extension of the government's efforts to place the burden of the financial crisis onto working people. The Financial Times editorialised that while it was "galling" to see the rules on public sector borrowing relaxed, "Mr. Brown and Mr. Darling are doing the right thing," noting "the private sector's appetite to lend money to governments has never been bigger... As Adam Smith once remarked, there is a great deal of ruin in a nation."

The government's "stimulus" plan in fact involves no help for the millions facing joblessness and home repossession.

The Bank warned that 1.2 million UK homeowners are at risk of negative equity if house prices continue to fall sharply. Already house repossessions have climbed by 71 percent over the year, amidst warnings that some 25 percent of homeowners are under threat as house prices are expected to fall by 30 percent. With hundreds of thousands facing the loss of their jobs, Brown categorically ruled out any aid stating, "I can't promise people that we will keep them in their last job if it becomes economically redundant. But we can promise people that we will help them into their next job."

Sharpest Consumption Drop Since 1980 Pushes GDP Negative

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By Dean Baker

A surge in defense spending added 0.86 percentage points to gross domestic product (GDP) growth.

Consumption spending fell at a 3.1 percent annual rate in the third quarter, which was the main factor leading to a 0.3 percent decline in GDP. Inventory build-ups prevented an even larger decline; final demand fell at a 0.8 percent annual rate.

The fall in consumption spending was the largest drop since an 8.6 percent decline in the second quarter of 1980. It was driven primarily by a drop of 14.1 percent in durable good purchases. Car sales fell at 25.6 percent annual rate in the quarter. Purchases of nondurable goods also fell sharply, declining at a 6.4 percent rate. Spending on services continued to increase, rising by 0.6 percent. Health care spending was the main factor behind this growth.

Residential construction fell for the 11th straight quarter, falling at a 19.1 percent annual rate. This reduced GDP growth for the quarter by 0.72 percentage points. Residential construction is now equal to just 3.3 percent of GDP. It peaked at 6.3 percent of GDP in the fourth quarter of 2005.

Nonresidential investment fell at a 1.0 percent rate, with a 7.9 percent increase in nonresidential structures largely offsetting a decline of 5.5 percent in equipment investment. Real investment in structures has increased by 40.3 percent since the fourth quarter of 2005. There has been somewhat of a bubble in this sector, which is bursting now. Office vacancy rates had been rising in many areas even before the recent downturn. There was also excess capacity in retail. While projects underway will be finished, excess supply coupled with tighter credit will lead to sharp declines in this sector over the next year.

The government sector added 1.15 percentage points to growth, with an 18.1 percent increase in defense spending being the main factor. Real defense spending now stands 7.7 percent above its year ago level and 12.3 percent higher than its level of two years ago.

The trade balance continued to improve in the quarter, adding 1.13 percentage points to GDP growth. Exports rose at a 7.5 percent annual rate, while imports fell at a 1.9 percent rate. However, this picture may be reversed in the quarters ahead, as foreign economies slide into recession and the rise in the dollar again makes US goods less competitive.

This report should help eliminate any immediate concerns about inflation. The overall price index rose at a 2.8 percent annual rate, while the core index rose at just a 2.4 percent rate. The sharp drop in commodity prices makes it virtually certain that inflation will slow even more in future quarters.

It is worth noting that net GDP actually stands 0.5 percent below its year ago level. This means the country had less to consume and invest based on the current quarter's output than it did based on the output from the third quarter of 2007.

The saving rate was 1.3 percent in the quarter. This is down from 2.7 percent in the second quarter, but that number was inflated by tax rebates. (Some checks were mailed in the first weeks of July.) The saving rate was just 0.2 percent in the first quarter of 2008 and has not been above 1.3 percent since the fourth quarter of 2004. It is likely the saving rate is on its way back to more normal levels as people begin to adjust to the loss of $5 trillion in housing-bubble wealth. This is a necessary process, as families will need to increase their savings, however, it raises the prospect of serious shortfalls in demand over the next two years. If the saving rate were to return to its normal post-war level of approximately 8 percent, it would imply a fall in annual consumption of approximately $700 billion.

The effect of falling consumption in the immediate future will be amplified by the reversal of the recent jump in defense spending, declines in nonresidential construction and a constant or rising trade deficit. The fourth quarter is almost certain to show a much sharper fall in GDP than the current quarter and the first quarter of 2009 could be even worse in the absence of an effective fiscal stimulus - even assuming that the financial situation stabilizes.

Federal court blocks ACLU from Guantanamo torture documents

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By Nick Cargo

The American Civil Liberties Union has condemned a Wednesday decision by a federal judge that prevents its access to unredacted records from the Bush administration related to the detention of 14 suspected "enemy combatants" at Guantánamo Bay.

The records of Combatant Status Review Tribunals contain the detainees’ personal accounts of interrogation tactics, including waterboarding, sleep deprivation, extreme temperature exposure and stress positions, that they endured while in custody at secret CIA detention facilities known as "black sites" for up to four years, and then Guantánamo in late 2006. Some records of the tribunals, which took place in March and April of 2007, have been released, but none that contain said accounts.

"This decision allows the Bush administration to continue its illegal cover-up of its systemic torture policies," said Ben Wizner, staff attorney with the ACLU National Security Project. "The government has suppressed these detainees’ allegations of brutal torture not to protect any legitimate national security interests, but to protect itself from criticism and liability. It is unlawful for the government to withhold information on these grounds."

The judge’s decision is available here (.pdf).

The lawsuit, filed by the ACLU in March, called for the records from the Department of Defense and the CIA on First Amendment grounds and in accordance with the Freedom of Information Act, per the request submitted in April of 2007.

"Since this FOIA request was submitted," the complaint reads, "the government has formally confirmed that three of the fourteen prisoners were subjected to the brutal practice of ’waterboarding,’ a notorious torture technique and the most controversial of the so-called ’enhanced interrogation techniques’ employed against prisoners in CIA custody. In light of this revelation, as well as many other disclosures about the treatment of these prisoners, any conceivable basis for withholding the prisoners’ accounts of their treatment in U.S. custody has been wholly eviscerated."

A PDF copy of the ACLU’s complaint, dated March 13, 2008, is available at this link.

US Federal Reserve cuts interest rates as recession deepens

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By Patrick O’Connor

The Federal Reserve yesterday cut its benchmark federal funds interest rate by a half a percentage point to 1 percent. The rate reduction is the Fed's second this month and brings the official interest rate down to a record low first reached in 2003 and 2004.

The volatile US share markets recovered some ground in anticipation of the rate cut, with the Dow Jones index closing 10.9 percent higher on Tuesday. But yesterday the Dow declined in late trading, falling 0.82 percent.

New economic data released in the last two days provide further evidence that the US economy has entered a severe recession.

The Conference Board released consumer confidence figures on Tuesday showing that its index plunged to 38.0, the lowest mark recorded since data was first kept in 1967. Consumer confidence was down from the 61.4 index rating in September, and considerably lower than what most analysts had anticipated. John Ryding at RDQ Economics described the October figures as "a shockingly weak reading."

Also released Tuesday was the S&P Case-Shiller index on housing prices, which found that house prices across 20 surveyed cities fell by 16.6 percent in August compared with the same period in 2007. Houses in Las Vegas, Phoenix, Miami and San Francisco suffered the biggest declines of 25-30 percent. Goldman Sachs' economists predicted that house prices will fall further by an average of 15 percent nationally.

A Wall Street Journal article yesterday stated: "The current downturn is shaping up to be worse than the recessions of 1990-91 and 2001 and the prolonged downturn that ended in 1982. Banks are cutting back on lending, consumers are spending less, companies are shedding jobs amid sinking profits, and the housing bust that triggered the slide persists."

One indicator of the rising social distress being felt by broad layers of the population is the escalating credit card default rate. According to the New York Times, lenders wrote off $21 billion in bad credit card loans in the first six months this year. Analysts estimate another $55 billion could be lost in the next 18 months.

Credit card companies have responded by targeting the victims of the recession. The Times reported: "Lenders are shunning consumers already in debt and cutting credit limits for existing cardholders, especially those who live in areas ravaged by the housing crisis or who work in troubled industries. In some cases, lenders are even reining in credit lines after monitoring cardholders who shop at the same stores as other risky borrowers or who have mortgages from certain companies."

Mass layoffs are being announced every day. Appliance maker Whirlpool announced yesterday it would increase layoffs from the previously announced 2,000 to 5,000 by the end of 2009. The sackings, which will affect 7 percent of the company's total workforce, are driven by slowing sales as consumers delay replacing malfunctioning appliances. Whirlpool has cut production by 10 percent in the third quarter this year and will reduce output by a further 20 percent in the US and Europe in the fourth quarter by shutting plants.

Other recently announced layoffs include: telephone company Qwest Communications, which is to cut 1,200 jobs; publishing giant Time Inc., which plans to dismiss 6 percent of its workforce; Doubleday Publishing, which has cut 10 percent of its staff; and newspaper publisher Gannett, which is also slashing 10 percent of its staff, on top of a 3 percent cut, affecting 1,000 workers, announced in August.

Workers in auto-related industries remain among the hardest hit. Michelin's BFGoodrich is laying off up to 40 percent of its workforce at a tire plant in Woodburn, Indiana for at least eight weeks in response to lower demand from auto makers and customers. Similar cuts are reportedly planned at two other BFGoodrich plants in Alabama, affecting a total of 1,500 workers across the three factories.

Tenneco, which produces auto emission and ride control systems, announced on Wednesday that it was cutting 1,100 jobs and closing five plants. About 500 salaried workers will be laid off and 600 hourly positions eliminated. The plant closures include one in Milan, Ohio, another in Evansville, Indiana and an engineering operation centre in Australia.

North American auto sales fell by 15.5 percent in the third quarter on an annualized basis. General Motors' sales declined by 18.9 percent in North America over the same period, and 11.4 percent globally. The former industrial giant continues to lose hundreds of millions of dollars each month. On Monday, ratings agency Moody's downgraded GM's credit rating further into "junk" status. It is now just three rungs above the lowest possible rating.

GM and Chrysler have reportedly resolved outstanding issues in their merger negotiations and are now seeking the necessary financing from the federal government. GM's chief executive Rick Wagoner has met with officials in Washington to lobby for a handover of public funds, modeled on the Bush administration's bailout of the financial sector.

Reuters cited sources who said GM was seeking $10 billion, while the Treasury Department was reportedly considering $5 billion. According to the news agency, a bailout "could include capital injections and government purchases of bad auto loans." The Wall Street Journal said on Monday that the public money may be channeled through the Energy Department, by diverting a portion of the $25 billion in low-interest loans approved last month for the auto industry to build more efficient vehicles.

A publicly-assisted financing operation for a GM-Chrysler merger would have a devastating social impact. The top executives responsible for running their companies into the ground will no doubt either retain their lucrative salary packages or be offered multi-million-dollar "golden handshakes" on their way out. Auto workers, on the other hand, will be asked to make even greater sacrifices and swallow further attacks on their jobs, wages, and conditions.

An article in yesterday's Guardian gave some indication of the potential effect of a merger between the US auto giants: "The manufacturers employ 355,000 people directly but support an estimated 4.5 million further jobs in industries from steel to plastics, electronics and computer chips. The non-profit Centre for Automotive Research in Michigan has estimated that a failure of Ford or GM could take a toll of 2 percent on the gross domestic product and would jeopardize as many as 2 million jobs."

The economic crisis is seeing merger proposals across a number of sectors. In the airline industry, Delta Air Lines and Northwest this week received Department of Justice approval for their planned union, which will create the world's largest airline company. Thousands more jobs will inevitably be lost in the sector as a result.

The rapidity of the economic downturn has alarmed a number of economists who are now warning of a potential deflationary crisis. The Wall Street Journal cited the comments of former Federal Reserve governor Laurence Meyer: "The expected rise in the unemployment rate, paired with the rising threat of deflation, presents a risk that the [Fed] will have to ease even further, perhaps all the way to a zero federal funds rate."

In yesterday's Financial Times, senior columnist Martin Wolf wrote: "[T]he idea that a quick recession would purge the world of past excesses is ludicrous. The danger is, instead, of a slump, as a mountain of private debt—in the US, equal to three times GDP—topples over into mass bankruptcy ... Globalisation would spread the catastrophe everywhere. Many of the victims would be innocent of past excesses, while many of the most guilty would retain their ill-gotten gains. This would be a recipe not for a revival of 19th-century laissez faire, but for xenophobia, nationalism and revolution."

This extraordinary statement underscores just how conscious sections of the ruling elite are of the likelihood that a prolonged world economic crisis will trigger major social and political upheavals.