Saturday, January 10, 2009

PTSD victim booted for ‘misconduct’

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By Kelly Kennedy

After serving two tours in Iraq — tours filled with killing enemy combatants and watching close friends die — Sgt. Adam Boyle, 27, returned home expecting the Army to take care of him.

Instead, service member advocates and Boyle’s mother say his chain of command in the 3rd Psychological Operations Battalion at Fort Bragg, N.C., worked to end his military career at the first sign of weakness.

In October, a medical evaluation board physician at Bragg recommended that Boyle go through the military disability retirement process for chronic post-traumatic stress disorder — which is supposed to automatically earn him at least a 50 percent disability retirement rating — as well as for chronic headaches. The doctor also diagnosed Boyle with alcohol abuse and said he was probably missing formations due to the medications doctors put him on to treat his PTSD.

But in December, Lt. Gen. John Mulholland, commanding general of the U.S. Army Special Operations Command, signed an order forcing Boyle out on an administrative discharge for a “pattern of misconduct,” and ordering that the soldier pay back his re-enlistment bonus.

Last year, after a number of troops diagnosed with PTSD were administratively forced out for “personality disorders” following combat deployments, the Defense Department changed its rules: The pertinent service surgeon general now must sign off on any personality-disorder discharge if a service member has been diagnosed with PTSD.

“Not even a year later, they’re pushing them out administratively for ‘pattern of misconduct,’ ” said Carissa Picard, an attorney and founder of Military Spouses for Change, a group created in response to the personality-disorder cases. “I’m so angry. We’re seeing it all the time. And it’s for petty stuff.”

In Boyle’s case, according to Picard and Boyle’s mother, Laura Curtiss, the soldier had gotten in trouble for missing morning formations and for alcohol-related incidents such as fighting and public drunkenness.

“The whole thing is absurd to me,” Picard said. “They acknowledge that PTSD causes misconduct, and then they boot them out for misconduct.”

Carol Darby, spokeswoman for Special Operations Command, said she could not discuss personnel administrative or medical issues, and that the Army did not have a response to the case as of Tuesday evening.

Doctors first diagnosed Boyle with PTSD after his second deployment ended in 2006, when he moved to a new unit. After he missed his first formation, he said he went in to talk to his first sergeant to explain he was having problems with depression, PTSD and insomnia. But after that, he said, no one ever asked how he was doing.

“They just said, ‘You messed up. Here’s what we’re going to do to you,’ ” Boyle said. “I would have loved it if someone had sat me down and had a heart-to-heart with me. I tried. I stuck with the counseling.”

But counseling at Fort Bragg was also difficult, he said, because there were not enough doctors for more than one counseling session a month, and because he had to explain his story to seven different therapists over two years.

He received two Article 15s, one for not reporting to duty while helping a girlfriend who had been in a car accident, and one for not returning home three days early from leave after drunk-and-disorderly conduct in a bar. Over that time, he said he was also experiencing flashbacks, anger-management and relationship issues, trust issues and guilt.

Picard said she has seen at least a dozen cases of soldiers with PTSD being pushed out for a “pattern of misconduct.”

Chuck Luther, also with Military Spouses for Change, said he’s working on four cases similar to Boyle’s now.

“I’ve seen the office of the surgeon general doing some great things,” Picard said. “But they didn’t intervene in this case. Technically, it’s OK. Morally, is it OK? No. If they’re going to call it a combat injury, they need to treat it, or else people will be afraid to come forward.”

Boyle’s mother gave another reason: “You can hear it in his voice,” Curtiss said. “He can’t believe the Army’s doing this to him. He needs counseling. He needs medication. He needs it even more now because of what they’ve put him through.”

Curtiss contacted Sen. Patrick Leahy, D-Vt., and a spokesman said the senator has been in contact with the Army several times about the case.

Boyle always wanted to be in the Army, Curtiss said, and served in junior ROTC while in high school. He planned to be an officer, worked as psychological operations sergeant, received a Good Conduct Medal and two Army Commendation medals, and wanted to spend his career in the military. Instead, he was twice diagnosed with PTSD and said he enrolled himself in the Army’s substance abuse program and went to group and individual counseling for his disorder, just as he was supposed to.

The administrative discharge means Boyle will have to prove that his PTSD is service-connected when applying for benefits from the Department of Veterans Affairs, and he’s not eligible to immediately receive the counseling he needs through the transition program for service members moving between the military and VA systems.

“The military is creating a societal issue,” Luther said. “These guys come out with no resources, and they’re angry and feeling betrayed. But commanders are thinking, ‘Do I rehabilitate him or do I get rid of him expeditiously so I can replace him with someone who can deploy?’ ”

Paul Sullivan, executive director of Veterans for Common Sense, said the Army should have provided Boyle with legal representation; that Boyle should remain in military therapy until VA processes his claim; that he should get an honorable discharge and go through the disability retirement process; and that the military needs to apply the same rules to “pattern of misconduct” as it does to personality disorders.

“The military should be concerned about the welfare of the soldier,” Sullivan said.

Retired Army Lt. Col. Mike Parker, who has worked as an advocate for service members going through the disability retirement system, said the cases are frustrating because veterans’ groups just fought to get the military to automatically award 50 percent disability ratings for people with PTSD severe enough to force them to leave the service, as is required by law. Many troops with PTSD had been receiving far lower ratings.

“Even though they have this new regulation saying they can’t kick them out for personality disorders, they can still kick them out for misconduct,” he said. “Everything they say, they have an escape clause.”

Boyle received word that Mulholland was standing behind his decision.

That means Boyle must repay the Army $18,500 for his re-enlistment bonus. The Army also withheld 65 days’ worth of leave payments and his final paycheck.

“I have nothing,” Boyle said. “After all I did for the Army, they took my money and kicked me to the curb and said, ‘Don’t let the door hit you in the ass.’ ”

Bush Prepares Request for Rest Of Bailout Funds

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By David Cho and Lori Montgomery

If Congress Votes Down Measure, Veto Power Could Come Into Play

Senior Bush administration officials, consulting with the Obama transition team, have prepared a plan to ask lawmakers for the second half of the $700 billion financial rescue package despite intense opposition in Congress, sources familiar with the discussions said.

The initiative could create an unusual political scenario straddling the Bush and Obama administrations. If Congress were to vote down the measure, either President Bush or Obama would have to exercise a veto to get the money.

Obama officials would prefer that Bush exercise any veto rather than leave the new president with the unsavory task of rebuffing his fellow Democrats in Congress to advance a widely unpopular program, sources said. The White House has declined to say publicly whether Bush would be willing to issue the veto.

"There have been discussions between the administration and the transition team on how to proceed should the president-elect determine that he would like President Bush to notify Congress on his behalf of the intent to use the remaining $350 billion so that it will be available early in the new administration," White House press secretary Dana Perino said. "No final decisions have been made."

But Democratic Senate aides were notified in a meeting yesterday afternoon that the request could come as soon as this weekend and that a vote could be held as early as next week, said congressional sources, who spoke on the condition of anonymity because no decisions have been made.

Under the emergency rescue legislation approved by Congress in October, the administration must inform lawmakers that it wants access to the second installment of $350 billion. Unless Congress passes a resolution rejecting the request within 15 days, the Treasury can begin to tap the funds. If Congress turns down the request, the president could veto the resolution and then the Treasury could proceed. The money would be blocked only if Congress overrides the veto, which would require a two-thirds majority in both chambers.

A congressional source said advocates of the plan are exploring whether there are enough votes in the Senate to sustain a veto. The first $350 billion has already been committed.

"There have been discussions between the administration and the transition about how to proceed should the president-elect determine that he wants to have those funds available on January 20," said Robert Gibbs, spokesman for President-elect Barack Obama's transition team. "No final decisions have been made, but we want to be ready to act if needed."

Both Bush and Obama officials say gaining access to the balance of the rescue funds is crucial to turning the economy around. Without the money, it would be nearly impossible to offer significant help for homeowners facing foreclosure, stabilize the financial system or jump-start the credit markets so more consumers and companies can get loans. The latest sign of the economy's deep malaise was new jobless figures released yesterday showing that unemployment has soared to 7.2 percent, the highest rate in 15 years. (See story on page D1.)

Even as senior Bush and Obama officials consulted about how to access the rest of the money, Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, unveiled a bill on Capitol Hill aimed at forcing the Treasury to use the money in accordance with lawmakers' wishes.

Many of the measure's provisions are being coordinated with Treasury Secretary nominee Timothy F. Geithner, who is planning to expand the scope of the rescue program well beyond the financial system to help ordinary consumers and homeowners, as well small businesses and municipalities. Frank said in a news conference yesterday that his bill might not be needed if the Obama administration promised to abide by its principles.

"It doesn't have to be enacted. It would be helpful if it was," Frank said. "We have smart and cooperative people in this [incoming] administration, I'm willing to accept their word that they will act as if it were the law."

Frank's bill would mandate that the Treasury allocate at least $40 billion for foreclosure prevention. Banks and other institutions that receive funds from the Troubled Asset Relief Program, or TARP, would be required to account for the use of the money. Clear limits on executive compensation would be imposed on all firms that take federal aid, including those that already received money.

The House is expected to vote on Frank's measure on Wednesday, congressional sources said. If the measure is approved, Frank has said that some lawmakers who would otherwise vote against releasing the next round of TARP funds might be persuaded to reconsider. Without Frank's bill, House leaders are convinced that lawmakers would block release of additional funds to the Treasury, which is widely viewed by lawmakers as having rushed the bailout through Congress and then badly mismanaged the program.

For Obama, using a veto runs the risk of souring his relationship with rank-and-file lawmakers, especially if it is one of his first official acts in the White House. It carries less risk for Bush, who is leaving office in a matter of days.

But the threat of a veto could assure distressed financial markets that more help is on the way.

In September, when Treasury secretary Henry M. Paulson Jr. proposed the rescue to Congress, the House at first voted down the plan. Global stock markets plummeted immediately. The initiative eventually passed both chambers and was signed into law in October.

Bush officials committed nearly all of the first half of the rescue funds on aiding the financial system and bailing out individual firms. But their programs angered lawmakers on both sides of the aisle. Some were steamed that no help was forthcoming for struggling homeowners. Others said the effort failed to stimulate lending.

A majority of lawmakers in both parties are strongly resistant to giving more money to continue the program, Democratic leaders say, adding that a request from either administration is likely to be rejected, making a veto almost unavoidable.

U.N. wants to know if war crimes were committed in Gaza

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By Ahmed Abu Hamda and Dion Nissenbaum

The U.N. high commissioner for human rights Friday called for an investigation of possible Israeli war crimes in Gaza as local residents told more gruesome tales about Israeli troops neglecting wounded civilians and the killing of unarmed Palestinians.

High Commissioner Navi Pillay noted the case of four boys who were rescued Wednesday by the International Committee of the Red Cross from the side of their dead mother in a dwelling 100 yards from an Israeli military post. The Red Cross called the incident "shocking," and Pillay told the BBC that it "had all the elements of what constitutes a war crime."

Eyewitnesses interviewed by McClatchy correspondents, along with Israeli and Palestinian human rights groups, described gruesome scenes in and near Gaza City.

Among them: the charred remains of a toddler that had been partially devoured by wild animals, reported by the Red Cross; and an infant bleeding to death in his mother's arms, reported to a McClatchy special correspondent; and an unarmed man allegedly shot dead by an Israeli soldier in front of his family, reported by a relative who spoke to a McClatchy special correspondent and a witness who was interviewed by an Israeli human rights group.

McClatchy staff reporters couldn't independently verify the alleged violations of international law because Israel has blocked foreign correspondents from entering Gaza.

The Israeli military says it's investigating the reports, but it defended its soldiers.

"Israeli forces aim for military targets," said Maj. Avital Leibovich, the chief Israeli military spokeswoman for the international media. "We aim for Hamas targets. We don't just kill innocent people for no reason."

Israel and Hamas ignored a unanimous United Nations Security Council resolution calling for an immediate cease-fire. The Bush administration abstained from voting on the resolution and the Israeli government dismissed it as ineffective and impractical, while Gaza militants launched more rockets on Friday into southern Israel, causing no serious injuries.

There was no sign that the conflict would end soon. Instead, Israeli leaders directed the military to intensify operations in Gaza, where about 800 Palestinians — nearly half of them women and children — have been killed in the past two weeks, according to Palestinian medical officials.

In what the U.N. Office for the Coordination of Humanitarian Affairs called "one of the gravest incidents" of the military operation, 30 Palestinians were reported killed when Israeli shells hit a home south of Gaza City that was filled with more than 100 residents who were trying to avoid the fighting.

Leibovich said the Israeli military so far hasn't been able to confirm that its forces hit the house and questioned reports that soldiers had rounded up family members in the neighborhood and escorted them to the home that was later hit.

Survivors interviewed by a McClatchy special correspondent at a Gaza City hospital, however, described being trapped for days inside their homes while Israeli forces moved through the neighborhood trying to root out Hamas militants.

Masouda Samouni said that Israeli troops forced her and her family out of their home as the soldiers searched the neighborhood in the first hours of the ground offensive, which began a week ago.

More than 100 residents eventually crowded into the home of Wael Samouni, where the families quickly ran short of food and water, she said.

While they were hiding in the home, survivors said, Israeli shells struck the building. The family members scrambled from room to room looking for safety, but medical officials said 30 people were killed, including Samouni's 10-month-old son.

Samouni said she was cradling her infant son when shrapnel struck both.

"I saw him," she said from her hospital bed. "His head went down and he opened his mouth. At that moment, I knew that he was dead and I held him to my chest."

Israeli forces allowed rescue workers to enter the neighborhood on Wednesday to lead the survivors to safety.

During the Israeli sweep of the neighborhood, two other members of the Samouni family said they watched an Israeli soldier shoot an unarmed man in front of his children.

While recovering from the attack at a Gaza City hospital, Rawyah Samouni told a McClatchy special correspondent that she witnessed an Israeli patrol converge on her nephew's house next door.

One of the soldiers demanded that the homeowner, Atiya Samouni, come out, she said.

He followed the order, Samouni said, and an Israeli soldier shot him twice in the chest and left him for dead.

In a separate interview given to the Israeli human rights group B'Tselem, Atiya Samouni's 22-year-old son Faraj described seeing his father shot from inside their house.

"They threw stun grenades into the house and fired," Faraj Samouni told B'Tselem. "They broke down the door and asked who the homeowner was. My father came out of the room and said yes. When he was standing at the door, he was fired at from about three meters and died."

Leibovich categorically dismissed the idea that an Israeli soldier would kill an unarmed man. The Israeli military said Thursday night, however, that it was looking into the story.

Rescue workers and survivors who were allowed late this week to escape Israeli-controlled areas described stark scenes.

Iyad Nasr, a Red Cross spokesman in Gaza, said that medical personnel had recovered the charred bodies of three Palestinians children, including a toddler, found next to a house in a neighborhood near Beit Lahiya in the northern Gaza Strip.

Nasr said that the toddler's body had been "eaten by wild dogs from the street."

A humanitarian aid worker said he came across the bodies in the northern Gaza Strip and that they appeared to have been hit by an Israeli shell while they were trying to run for safety.

The worker, who asked not to be identified for fear of jeopardizing his ability to take part in rescue efforts, said the youngest, around two years old, had been partially eaten by wild animals.

"It was like charcoal," the man said of the toddler's body. "Also without any limbs, because some of the animals ate some of his limbs."

The humanitarian challenges have been compounded by the inability of aid groups to get food into Gaza.

Leibovich said that a senior Israeli defense official met Friday with representatives of the U.N. and the Red Cross to discuss the groups' allegations that Israeli forces weren't doing enough to ensure the safety of relief workers in Gaza.

Leibovich, however, said that one of the incidents that prompted the U.N. to halt the movement of its staff in Gaza — the fatal shooting Thursday morning of a U.N.-contracted relief truck driver near the Erez crossing — wasn't a result of Israeli fire.

"We looked into it, and we did not shoot at that truck," Leibovich said.

U.N. officials stood by their account, in which Palestinian contractors said that Israeli ground troops opened fire on the forklift truck, killing a driver and wounding two others. The incident caused the private Palestinian company, the only one authorized by Israel to deliver U.N. aid into Gaza, to suspend its operations for the safety of its staff.

The U.N. World Food Program, which feeds 265,000 Palestinians in Gaza — some 18 percent of the population — said that it was able to deliver food within Gaza but that it risked running out of stocks within several days if trucks didn't resume deliveries into the territory, spokeswoman Barbara Conte said.

With no U.N. or Red Cross deliveries entering Gaza on Friday, 50 truckloads of goods did pass through the Erez crossing carrying donations from Palestinian and Jordanian groups, said Peter Lerner, an Israeli military spokesman.

In Washington, All Roads Lead to Tehran

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By Daniel Luban

As the war in Gaza approaches its third week, a chorus of influential voices in the U.S. media has cast the conflict as a proxy war in which the real enemy is not Hamas but Iran.

The result has been a growing tendency in the U.S. to view Gaza as simply one battleground in a larger war between Iran and the West, and to dismiss the stated concerns of the Palestinians as a mere smokescreen for Iranian influence.

But critics charge that this way of framing the conflict is both overly simplistic and agenda-driven. By overstating the importance of Iran's operational aid to Hamas, they claim, these opinion-makers aim to increase hostilities with Iran, to bolster an increasingly shaky Israeli rationale for war, and to curtail any inclination to reach a peace settlement with the Palestinians.

For years, it has been a commonplace among neoconservatives that Iran is the real source of opposition to the U.S. and Israel throughout the Middle East, from Palestine to Lebanon to Iraq. During Israel's 2006 war with Hezbollah in Lebanon, prominent neoconservatives urged the West to focus "less on Hamas and Hezbollah, and more on their paymasters and real commanders in Syria and Iran", as William Kristol wrote in the Weekly Standard.

Similarly, neoconservatives have taken the current war with Hamas as a sign that the West needs to take a harder line with Iran. "It's all about Iran," Michael Ledeen, a prominent Iran hawk based at the Foundation for the Defence of Democracies, wrote in National Review Online on Dec. 30. "[The Israelis] are left to contend with the tentacles of the terrorist hydra, while the main body remains untouched. They may chop off a piece of Hamas or Hezbollah, but it will regenerate and grab them again."

However, the belief that Hamas is merely an Iranian proxy has spread beyond neoconservative circles to be voiced by opinion-makers closer to the political centre. Self-described realist Robert Kaplan wrote in the Atlantic on Monday that "Israel's attack on Gaza is, in effect, an attack on Iran's empire...Our own diplomacy with Iran now rests on whether or not Israel succeeds."

In the New York Times, influential neoliberal Thomas Friedman implied that Iran was to blame for the outbreak of hostilities in Gaza, writing that Tehran can "stop and start the Israeli-Palestinian conflict at will". In the Los Angeles Times, Israeli commentators Yossi Klein Halevi and Michael B. Oren wrote an op-ed titled "In Gaza, the real enemy is Iran", which warned that if Hamas "manipulat[es] world opinion into the imposition of a premature ceasefire...[it] would mean another triumph for Iran".

And in the literature released by hawkish advocacy groups such as the Israel Project, Hamas is rarely mentioned without the adjective "Iran-backed".

It is widely accepted that Iran has in fact provided weaponry and other operational assistance to Hamas in recent years. However, there are few reliable estimates of the scope of this aid.

"I'm very sceptical whenever I see figures in the media," former State Department intelligence official Wayne White, now of the Middle East Institute, told IPS. "Even when I was in the intelligence community, exact details were often elusive."

Many feel that those blaming Iran for the Gaza crisis attach too much importance to Iran's operational aid to Hamas when they suggest that Hamas is nothing more than an Iranian "proxy".

White suggested that Iran's relationship with Hamas is "more symbiotic than dictatorial", and that its influence with Hamas is more limited than is portrayed in the media. "Iranian inspiration is being given far too much weight in the overall Israeli-Hamas equation. Hamas has every reason to make its own decisions, most of which are sufficiently militant to please the Iranians," he said.

Critics charge that framing the Gaza conflict as an U.S.-Iran proxy war is a tendentious move that is meant to advance several covert political goals.

The most obvious of these goals is to increase hostilities with Iran. Unsurprisingly, many of those espousing the "proxy war" argument, such as Ledeen, are advocates of regime change in Tehran, backed if necessary by military force.

But the proxy war argument has also been deployed to bolster the Israeli case for war in Gaza, as Israel's war aims have become increasingly slippery and elusive over the past two weeks.

Israeli officials have at times suggested that the war is intended to halt all rocket fire from Gaza, or to overthrow Hamas rule in Gaza, but both of these goals are viewed by many as unrealistic and the Israeli government has subsequently backed off of them.

Casting the military campaign as a struggle against Iranian power provides a broader rationale for war, and has been used as a way to rally support from U.S. policymakers who are sceptical of the campaign's wisdom. On this analysis, Israel is doing the U.S.'s dirty work by confronting Iranian power.

In this vein, the Wall Street Journal editorialised on Monday that the war would help President-elect Barack Obama's diplomatic efforts with Iran, since "the mullahs are going to be more interested in diplomacy if their military proxies have been defeated".

And hawkish liberal Jim Hoagland suggested in the Washington Post that Israel's attack was helping to hold off the possibility of a nuclear Iran, writing that "only Israel poses any threat of military action to halt Iran's drive to enrich enough uranium to build a nuclear bomb".

But one important consequence of the proxy war argument, critics say, has more to do with Palestine than with Iran. By portraying Hamas as nothing more than a projection of Iranian power, commentators implicitly reject any notion that the group may derive its influence from specifically Palestinian concerns.

By doing so, the critics argue, these commentators seek to assuage Israeli consciences by portraying Hamas as the product of a nebulous Islamist menace rather than of local grievances about occupation, refugees, or settlements.

But more than that, they seek to remove any impetus to compromise on such issues. If Iranian power is the real cause of Israel's Palestinian problem, then a local settlement with the Palestinians would do little to alleviate Israel's insecurity.

In response, a growing number of analysts have spoken out against this line of thinking.

"Yes, the conflict has been exploited on many sides and certainly by Iran and other hardliners in the region," wrote former Israeli peace negotiator Daniel Levy of the New America Foundation on Monday. "[B]ut if the unaddressed Palestinian grievance did not exist then it would not be there to exploit."

White concurred in his assessment of the situation.

"The [proxy war] view is a very unsophisticated one," he told IPS. "This is at bottom a struggle between Hamas, along with many other Palestinians, and the Israelis."

Israel Rejected Hamas Ceasefire Offer in December

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By Gareth Porter

Contrary to Israel's argument that it was forced to launch its air and ground offensive against Gaza in order to stop the firing of rockets into its territory, Hamas proposed in mid-December to return to the original Hamas-Israel ceasefire arrangement, according to a U.S.-based source who has been briefed on the proposal.

The proposal to renew the ceasefire was presented by a high-level Hamas delegation to Egyptian Minister of Intelligence Omar Suleiman at a meeting in Cairo Dec. 14. The delegation, said to have included Moussa Abu Marzouk, the second-ranking official in the Hamas political bureau in Damascus, told Suleiman that Hamas was prepared to stop all rocket attacks against Israel if the Israelis would open up the Gaza border crossings and pledge not to launch attacks in Gaza.

The Hamas officials insisted that Israel not be allowed to close or reduce commercial traffic through border crossings for political purposes, as it had done during the six-month lull, according to the source. They asked Suleiman, who had served as mediator between Israel and Hamas in negotiating the original six-month Gaza ceasefire last spring, to "put pressure" on Israel to take that the ceasefire proposal seriously.

Suleiman said he could not pressure Israel but could only make the suggestion to Israeli officials. It could not be learned, however, whether Israel explicitly rejected the Hamas proposal or simply refused to respond to Egypt.

The readiness of Hamas to return to the ceasefire conditionally in mid-December was confirmed by Dr. Robert Pastor, a professor at American University and senior adviser to the Carter Centre, who met with Khaled Meshal, chairman of the Hamas political bureau in Damascus on Dec. 14, along with former President Jimmy Carter. Pastor told IPS that Meshal indicated Hamas was willing to go back to the ceasefire that had been in effect up to early November "if there was a sign that Israel would lift the siege on Gaza".

Pastor said he passed Meshal's statement on to a "senior official" in the Israeli Defence Forces (IDF) the day after the meeting with Meshal. According to Pastor, the Israeli official said he would get back to him, but did not.

"There was an alternative to the military approach to stopping the rockets," said Pastor. He added that Israel is unlikely to have an effective ceasefire in Gaza unless it agrees to lift the siege.

The Israeli Embassy in Washington declined to comment Thursday on whether there had been any discussion of a ceasefire proposal from Hamas in mid-December that would have stopped the rocket firing.

Abu Omar, a spokesman for Hamas leader Khaled Meshal in Syria, told CBS news Wednesday that Hamas could only accept the ceasefire plan now being proposed by France and Egypt, which guarantees an end to Israel's blockade of Gaza as soon as hostilities on both sides were halted. Israeli government spokesman Mark Regev said Israel would only support the proposal if it also included measures to prevent Hamas from re-arming.

The interest of Hamas in a ceasefire agreement that would actually open the border crossings was acknowledged at a Dec. 21 Israeli cabinet meeting -- five days before the beginning of the Israeli military offensive -- by Yuval Diskin, the head of Israel's internal security agency, Shin Bet. "Make no mistake, Hamas is interested in maintaining the truce," Diskin was quoted by Y-net News agency as saying.

Israel's rejection of the Hamas December proposal reflected its preference for maintaining Israel's primary leverage over Hamas and the Palestinian population of Gaza -- its ability to choke off food and goods required for the viability of its economy -- even at the cost of continued Palestinian rocket attacks.

The ceasefire agreement that went into effect Jun. 19, 2008 required that Israel lift the virtual siege of Gaza which Israel had imposed after the June 2007 Hamas takeover. Although the terms of the agreement were not made public at the time, they were included in a report published this week by the International Crisis Group (ICG), which obtained a copy of the understanding last June.

In addition to a halt in all military actions by both sides, the agreement called on Israel to increase the level of goods entering Gaza by 30 percent over the pre-lull period within 72 hours and to open all border crossings and "allow the transfer of all goods that were banned and restricted to go into Gaza" within 13 days after the beginning of the ceasefire.

Nevertheless, Israeli officials freely acknowledged in interviews with ICG last June that they had no intention of opening the border crossings fully, even though they anticipated that this would be the source of serious conflict with Hamas.

The Israelis opened the access points only partially, and in late July Foreign Minister Tzipi Livni declared that the border crossings should remain closed until Hamas agreed to the release of Gilad Shalit, an IDF soldier abducted by Hamas in June 2006. The Hamas representative in Lebanon, Usam Hamdan, told the ICG in late December that the flow of goods and fuel into Gaza had been only 15 percent of its basic needs.

Despite Israel's refusal to end the siege, Hamas brought rocket and mortar fire from Gaza to a virtual halt last summer and fall, as revealed by a report by the Intelligence and Terrorism Information Center (ITIC) in Tel Aviv last month. ITIC is part of the Israel Intelligence Heritage & Commemoration Centre (IICC), an NGO which is close to the Israeli intelligence community.

In the first days after the ceasefire took effect, Islamic Jihad fired nine rockets and a few mortar rounds in retaliation for Israeli assassinations of their members in the West Bank. In August another eight rockets were fired by various groups, according to IDF data cited in the report. But it shows that only one rocket was launched from Gaza in September and one in October.

The report recalls that Hamas "tried to enforce the terms of the arrangement" on other Palestinian groups, taking "a number of steps against networks which violated the arrangement," including short-term detention and confiscating their weapons. It even found that Hamas had sought support in Gazan public opinion for its policy of maintaining the ceasefire.

On Nov. 4 -- just when the ceasefire was most effective -- the IDF carried out an attack against a house in Gaza in which six members of Hamas's military wing were killed, including two commanders, and several more were wounded. The IDF explanation for the operation was that it had received intelligence that a tunnel was being dug near the Israeli security fence for the purpose of abducing Israeli soldiers.

Hamas officials asserted, however, that the tunnel was being dug for defensive purposes, not to capture IDF personnel, according to Pastor, and one IDF official confirmed that fact to him.

After that Israeli attack, the ceasefire completely fell apart, as Hamas began openly firing rockets into Israel, the IDF continued to carry out military operations inside Gaza, and the border crossings were "closed most of the time", according to the ITIC account.

Israel cited the firing of 190 rockets over six weeks as the justification for its massive attack on Gaza.

*Gareth Porter is an investigative historian and journalist specialising in U.S. national security policy. The paperback edition of his latest book, "Perils of Dominance: Imbalance of Power and the Road to War in Vietnam", was published in 2006.

Both parties cheerlead still more loudly for Israel's war

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By Glenn Greenwald

(updated below)

World concern over, and opposition to, the Israeli war in Gaza is rapidly mounting:

International pressure intensified sharply on Israel on Thursday, the 13th day of its Gaza assault, after the United Nations suspended food aid deliveries, the International Committee of the Red Cross accused the Israelis of knowingly blocking assistance to the injured, and a top Vatican official defended comments in which he compared Gaza to a concentration camp.

The Israelis have deliberately made it impossible to know the full extent of the carnage and humanitarian disasters because they continue to prevent journalists from entering Gaza even in the face of a now week-old Israeli Supreme Court order compelling them to do so. According to Palestinian sources, there are now 700 dead Palestinians -- at least 200 of them children -- and well over 1,000 wounded. Those numbers are not seriously doubted by anyone. By comparison, a total of 10 Israelis have died -- 10 -- almost all of them by "friendly fire." The unusually worded Red Cross condemnation of Israel was prompted by its discovery, after finally being allowed into Gaza, of starving Palestinian children laying next to corpses, with ambulances blocked for days by the IDF. Even with the relative "restraint" Israel is excercising (the damage it could cause is obviously much greater), this is not so much of a war as it is a completely one-sided massacre.

As a result, much of the world is urging an end to the war and acting to forge a cease-fire -- except the United States. Here, blind and unequivocal support for the Israeli attack is actually increasing almost as fast as the Palestinian body count piles up. Apparently, it isn't enough that we supply the very bombs being dropped on the Palestinians and use our U.N. veto power to prevent any U.N. action to stop the war or even to urge its cessation. The U.S. Congress wants to involve the U.S. further still in Israel's war.

This afternoon, the Democratic-led U.S. Senate did just that by enacting -- via a cowardly voice vote -- a completely one-sided, non-binding resolution that expresses unequivocal support for the Israeli war, and heaps all the blame for the conflict on Hamas and none of it on Israel. Harry Reid -- who jointly sponsored the Resolution with GOP Leader Mitch McConnell -- proudly proclaimed: "When we pass this resolution, the United States Senate will strengthen our historic bond with the state of Israel." On its website, AIPAC is already patting the U.S. Senate on its head for "for conveying America's unequivocal and steadfast support for Israel's right to self-defense."

The Senate resolution is here (.pdf). The very similar House version that was circulated earlier today was drafted by Israel-centric House Foreign Affairs Chairman Howard Berman (D-Calif.). It is here (.pdf), and is expected to pass early next week -- undoubtedly with overwhelming bipartisan support. ThinkProgess noted yesterday that Democrats took the lead in drafting the Resolution because they did not want to be "out-hawked by the Republicans," though it's hardly unusual for Democrats to march in lockstep with Republicans on Israel more than any other issue.

It's hard to overstate how one-sided this resolution is. It "expresses vigorous support and unwavering commitment to the welfare, security, and survival of the State of Israel as a Jewish and democratic state with secure borders." Why should the U.S. maintain an "unwavering commitment to the welfare" of a foreign country? It "lays blame both for the breaking of the 'calm' and for subsequent civilian casualties in Gaza precisely where blame belongs, that is, on Hamas." It repeatedly mentions the various sins of Hamas -- from rockets to suicide attacks -- but does not mention a single syllable of criticism for Israel. In the world of the U.S. Congress, neither the 4-decade occupation of Palestinian land nor the devastating blockade of Gaza nor the ongoing expansion of Israeli settlements even exist. That may not be mentioned.

The Resolution demands that Hamas take multiple steps towards peaceful resolution but demands that Israel do absolutely nothing. It purports to call for a cease-fire in which the Palestinians make all the concessions and Israel makes none. Worst of all -- in light of the Red Cross condemnation, yesterday's slaughter at the U.N. school, and other similar incidents -- the Resolution disgustingly praises Israel's conduct of the war, claiming that "Israel has facilitated humanitarian aid to Gaza with hundreds of trucks carrying humanitarian assistance and numerous ambulances entering the Gaza Strip since the current round of fighting began on December 27, 2008."

This one-sided, ostensibly "pro-Israel" bipartisan inflaming of tensions by the U.S. is nothing new. Long-time Middle East negotiator Aaron David Miller, in Newsweek, earlier this week made one of the most startling revelations in some time -- that in all the time the U.S. has supposedly been attempting to forge a Middle East peace agreement over the past 25 years, it never once, in any meaningful way, raised with Israeli leaders the damage that comes from Israeli settlements. Specifically, said Miller: "I can't recall one meeting where we had a serious discussion with an Israeli prime minister about the damage that settlement activity — including land confiscation, bypass roads and housing demolitions — does to the peacemaking process."

Miller emphasized that by being so blindly supportive even of misguided Israeli actions, "the United States has allowed that special bond to become exclusive in ways that undermine America's, and Israel's, national interests." The only way the U.S. can play a constructive role in the Middle East, he argues, is if it is even-handed and, most importantly, willing to criticize Israeli actions when they harm American interests (and their own) and pressure them to stop. Matt Yglesias, in a new piece up at The American Prospect, makes much the same point.

Yet here we have, yet again, exactly the opposite behavior -- equally from both parties. At exactly the time that worldwide horror over this war is at its peak, the Democratic-led Congress steps up to announce to the world: "this is our war, too; we support whatever Israel does absolutely and without reservations." We thus make Israel's wars our wars; its enemies our enemies; its intractable disputes our disputes; and the hostility and anger it generates our own. And we embolden Israel to continue further.

Given that we endlessly hear from our political establishment that the first and most important obligation of our leaders is to "keep us safe" -- that's the justification for everything from torture to presidential lawbreaking -- what possible legitimate rationale is there for the U.S. Congress to act in unison to involve itself in Israel's war so emphatically, and to thereby re-direct the anger over Israeli actions even further towards the U.S. and American citizens? How are U.S. interests even remotely advanced by insinuating ourselves this way? As Juan Cole recounted this week:

In 1996, Israeli jets bombed a UN building where civilians had taken refuge at Cana/ Qana in south Lebanon, killing 102 persons; in the place where Jesus is said to have made water into wine, Israeli bombs wrought a different sort of transformation. In the distant, picturesque port of Hamburg, a young graduate student studying traditional architecture of Aleppo saw footage like this on the news [graphic]. He was consumed with anguish and the desire for revenge. As soon as operation Grapes of Wrath had begun the week before, he had written out a martyrdom will, indicating his willingness to die avenging the victims, killed in that operation--with airplanes and bombs that were a free gift from the United States. His name was Muhammad Atta. Five years later he piloted American Airlines 11 into the World Trade Center. . . .

On Tuesday, the Israeli military shelled a United Nations school to which terrified Gazans had fled for refuge, killing at least 42 persons and wounding 55, virtually all of them civilians, and many of them children. The Palestinian death toll rose to 660.

You wonder if someone somewhere is writing out a will today.

The U.S. does enough on its own to make itself the target of worldwide anger. Why must it take on Israel's battles as well?

The fact that this is a non-binding resolution makes it worse, not better. It achieves nothing other than rubbing in the world's face -- including the Muslim world -- that this is not just an Israeli attack on Palestinians but an American attack as well. As BooMan put it in explaining that virtually no mainstream U.S. politician would dare oppose this Resolution: "This, then, creates the false impression that there is near unanimity of support for whatever it is that Israel wants to do. And let me frank about this . . . sending such a message does more to put Americans at risk than it does it protect Israelis."

TPM's Elana Schor today wrote: "We're looking into whether any senator was bold enough to decline to co-sponsor the measure." It will be a surprise if there were any. Many members of Congress -- with some noble exceptions -- still remain pitifully afraid that the likes of David "Axis of Evil" Frum will accuse them of being anti-Semitic if they dare oppose Israeli actions, even in the name of U.S. interests, while others continue to be supportive of any war or proposed war waged on Muslims or Arabs -- regardless of the rationale for the war or its severity.

Whatever the motives, for America to blindly support Israel's self-destructive and unjustified behavior does not serve Israeli interests and -- most importantly -- does not serve America's. Blind support isn't "friendship," nor is enabling someone else's destructive behavior. It's subservience. And few things are as harmful or as unjust as the cowardly, lockstep behavior of both major American political parties when it comes to Israel.

UPDATE: Since the Israeli attack on Gaza began, the advocacy of J Street -- the new Jewish-American organization designed to break AIPAC's monopoly on speaking for American Jews -- has been superb. They have gone much further than any Jewish group that is taken seriously by the establishment, continuously expressing opposition to the Israeli offensive and infuriating those who want to maintain a neoconservative stranglehold over speaking for American Jews. Earlier today, I asked them for their position on the Senate Resolution and, just now, this is what they sent me:

Since the first days of the crisis in Gaza, J Street has consistently called for strong American leadership to reach a ceasefire that ends all military operations, stops the rockets aimed at Israel, institutes an effective mechanism to prevent weapons smuggling into Gaza, and lifts the blockade of Gaza. Since J Street's founding, we have consistently advocated for active American diplomacy to resolve the Israeli-Palestinian conflict.

We support Congressional action that endorses these aims.

That statement -- by design, I would guess -- is unclear in the extreme. It seems intended to imply -- without actually stating -- support for the Congressional Resolutions. They say they "support Congressional action that endorses these aims," but -- conspicuously -- they don't actually say whether the Resolution passed by the Senate and to be passed by the House does so. It's hard to see how either of the two Resolutions could be deemed to do so, given that neither even mentions, for instance, a lifting of the blockade of Gaza. But that's the statement J Street issued.

On a related note, MediaBloodHound has the details on the very interesting story of how AP caused to vanish into thin air the tough questioning by its reporter of the U.S. State Department regarding Gaza.

US plans massive arms delivery to Israel

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The Pentagon plans to make a large arms delivery to Israel, rising fears that the military campaign in Gaza will go on for a long time. The US is trying to hire a merchant ship that can carry hundreds of tons of weapons from Greece to Israel later this month; Reuters reported citing tender documents it had obtained. According to the US Navy's Military Sealift Command (MSC), the ship will transport 325 standard 20-foot containers of what has been called 'ammunition' from the Greek port of Astakos to the Israeli port of Ashdod on two separate trips in the second half of January. A description on the manifest says the containers will be loaded with 'hazardous material', such as explosive substances and detonators, without giving any more details. The Pentagon announced the tender for the ship in the last hours of 2008. The two deadlines set for the deliveries are January 25 and the last day of the month. Meanwhile, a Pentagon spokesman confirmed the planned arms shipment to Israel, but denied that the delivery was linked to the Israel's deadly offensive in Gaza. "This previously scheduled shipment is routine and not in support of the current situation in Gaza," said Air Force Lt. Col. Patrick Ryder. However, a senior military analyst in London, who wished to remain unnamed, said the timing of the shipments shows that they may be 'irregular' and linked to the military operation in Gaza. The tender for the ship followed a December US arms delivery to Israel, which was also carried out by a merchant ship. This is while shipping brokers in London who have carried out weapon deliveries for the British and US military in the past say that shipment of such a large cargo of weapons to Israel is rare. "Shipping 3,000-odd tons of ammunition in one go is a lot… this is pretty rare and we haven't seen much of it quoted in the market over the years," one broker said, on condition of anonymity. Tender documents indicate that the German ship hired by the US in early December also carried a massive cargo of weapons that weighed over 2.6 million kg and filled up to 989 standard 20-foot containers to Ashdod from North Carolina. In September, the US Congress approved a plan to sell Israel 1,000 bunker-buster bombs, of the Guided Bomb Unit-39 (GBU-39), that use GPS to find their way and are able to penetrate deep fortified constructions, such as Iran's nuclear facilities. Last week, The Jerusalem Post, reported that the first shipment of the missiles arrived in early December, adding that the bombs had been used in the military onslaught in Gaza. So far, Israel's 15-day offensive in the besieged Palestinian enclave has claimed the lives of more than 800 Palestinians and wounded almost 3500. Hamas on the other hand says Palestinian fighters have so far killed at least 30 Israeli soldiers and wounded more than 80 others.

Weapons Killing People In Gaza, Made In USA

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By Ron Paul

United States House of Representatives

Statement on H Res 34, Recognizing Israel's right to defend itself against attacks from Gaza, Reaffirming the United States strong support for Israel, and supporting the Israeli-Palestinian peace process. January 09, 2009

Madame Speaker, I strongly oppose H. Res. 34, which was rushed to the floor with almost no prior notice and without consideration by the House Foreign Affairs Committee. The resolution clearly takes one side in a conflict that has nothing to do with the United States or US interests. I am concerned that the weapons currently being used by Israel against the Palestinians in Gaza are made in America and paid for by American taxpayers. What will adopting this resolution do to the perception of the United States in the Muslim and Arab world? What kind of blowback might we see from this? What moral responsibility do we have for the violence in Israel and Gaza after having provided so much military support to one side?

As an opponent of all violence, I am appalled by the practice of lobbing homemade rockets into Israel from Gaza. I am only grateful that, because of the primitive nature of these weapons, there have been so few casualties among innocent Israelis. But I am also appalled by the longstanding Israeli blockade of Gaza -- a cruel act of war -- and the tremendous loss of life that has resulted from the latest Israeli attack that started last month.

There are now an estimated 700 dead Palestinians, most of whom are civilians. Many innocent children are among the dead. While the shooting of rockets into Israel is inexcusable, the violent actions of some people in Gaza does not justify killing Palestinians on this scale. Such collective punishment is immoral. At the very least, the US Congress should not be loudly proclaiming its support for the Israeli government’s actions in Gaza.

Madame Speaker, this resolution will do nothing to reduce the fighting and bloodshed in the Middle East. The resolution in fact will lead the US to become further involved in this conflict, promising “vigorous support and unwavering commitment to the welfare, security, and survival of Israel as a Jewish and democratic state.” Is it really in the interest of the United States to guarantee the survival of any foreign country? I believe it would be better to focus on the security and survival of the United States, the Constitution of which my colleagues and I swore to defend just this week at the beginning of the 111th Congress. I urge my colleagues to reject this resolution.

The outcry is muted, but the food crisis is getting worse

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By Jayati Ghosh

The financial debacle has drowned out coverage of food shortages. Where are the billion-dollar bailouts for the hungry?

Just a few months ago, we were being told that this is a period of stark, unprecedented and unfolding food crisis, with looming shortages and huge global imbalances between demand and supply. Everyone who matters - from officials in international organisations to leaders of rich and poor countries - warned us of the terrible social, political and nutritional consequences of doing nothing, of the millions who would go hungry and the riots that would occur if the imbalances persisted or increased.

But now the whole problem has disappeared from the international radar, relegated to the inside pages of newspapers and perfunctory afterthoughts in politicians' speeches. So what happened? Was it not such a problem, after all?

No, the "silent tsunami" has simply been overwhelmed in public awareness by the much noisier tsunami in the world of international finance, with the giant sucking sounds of possible bank collapses and enormous bail-outs grabbing all the attention. Yet the global food crisis is far from over, and is even likely to intensify in the near future.

One reason why many analysts decided that the food crisis may not be so intense is the global decline in crop prices that began sometime in the middle of last year. For about two years before that, commodity prices, including both food and non-food crops, had been increasing, and in the first few months of 2008 they soared. But in early June last year the prices of both oil and food crops fell, so that they are now lower than they were even a year ago.

When food prices were rising, there was much talk of the shifts in demand that were causing this trend. President Bush joined those who decided that this reflected the increased demand from China and India as their per capita incomes grew. This was a ludicrous argument because food consumption has actually declined in both countries. Both economies have shown even sharper declines in per capita food intake despite the continued presence of widespread hunger, because of increased income inequalities within these countries. In any case, that argument about more food demand from China and India quickly collapsed along with the fall in global prices. Now it is more than evident that the wild swings that have been observed in food and several commodity markets over this year have been the result of speculative forces, rather than any real changes in global demand and supply.

But despite this volatility and the recent price decline, the food crisis remains. And it does indeed reflect patterns of demand and supply - but not the ones that have been talked about. The basic problem now is not even one of absolute shortage so much as the inability to pay for food, and this problem will get worse for many developing countries and their poorer citizens.

Three problems now dominate the global food scenario. First, there is a crisis of cultivation, especially in the developing world. This is the result of two decades of policy neglect: falling public investment in agricultural research, extension and support; aggressive trade liberalisation that exposed southern farmers to heavily subsidised marketing by northern agribusinesses; financial liberalisation that reduced cultivators' access to credit and made them prey to speculative forces that also affected prices. As a result, cultivation costs have increased even in years when crop prices are falling, and cultivation is becoming unviable in many countries.

Second, this has been associated with a depression in wages in developing countries, which means that mass purchasing power did not increase even when the economies were growing. So demand for food has not gone up, simply because the poor do not have the incomes to pay for it.

Third, there has been an increasing concentration of firms operating in global agriculture, with a few large agribusinesses coming to dominate both input and output markets. These companies are also the ones who benefit from government subsidies promoting ethanol, which divert land meant for food to the paradoxically more energy-intensive production of fuel for cars. This concentration is reflected in recent food-price trends: while world prices have fallen sharply in the past four months, retail prices of food in most developing countries have not fallen.

Unfortunately, each of these negative processes is likely to intensify. The financial crisis will reduce the ability of developing country governments to increase much-needed investment in agriculture or enlarge the distribution of affordable food. It will adversely affect wage incomes, reducing purchasing power further. And it will add to pressures for concentration in industry, including agribusiness.

In the middle of last year, we had a global outcry about the perilous state of billions of people in developing countries whose governments could not afford to provide enough food for them and who could not themselves earn enough to buy food at prevailing prices. These problems are now worse, but the global outcry is all about the multinational banks that are under threat. And several multiples of the money that could not be found to provide food for the hungry are quickly being delivered to bail out irresponsible finance.

The Plot Against Pensions and the Plan to Save Them

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By Amy Goodman

The following is a transcript from an interview from Democracy Now!

For the 50 million Americans with 401(k) retirement plans, 2008 is a year many wish they could forget. Workers saw their 401(k) plans lose between 20 and 30 percent of their value as the Dow Jones Industrial Average suffered its worst year since the Depression. Between October 2007 and 2008, more than $1 trillion worth of stock value held in 401(k)s and other defined contribution plans were wiped out. For workers nearing retirement, the losses have been devastating.

Meanwhile, several major corporations have recently announced they are suspending matching contributions to workers’ 401(k) plans due to the economic crisis. The firms include FedEx, Motorola, General Motors, Starbucks and Sears. Congress is now considering overhauling the 401(k) program.

AMY GOODMAN: Our next guest, Teresa Ghilarducci, testified before Congress recently and proposed establishing a system where workers pay into a government-managed fund that would offer a guaranteed monthly pension at retirement to supplement Social Security. Her plan has been intensely criticized by the finance industry. One columnist described her as the "Most Dangerous Woman in America.”

Teresa Ghilarducci is the director of the Schwartz Center for Economic Policy Analysis at the New School for Social Research. She is the author of the book When I’m Sixty-Four: The Plot Against Pensions and the Plan to Save Them.

Well, I am sure risking a lot here, having the most dangerous woman in America sitting next to us, but we’re willing to take the risk. Professor Ghilarducci, explain what’s happening now in light of all -- well, Obama just spoke on the economy yesterday.

TERESA GHILARDUCCI: It’s really the end of a thirty-year experiment with a do-it-yourself pension system. The United States stood above all other nations in saying, “Look, we’re going to hand over this saving and investing responsibility over to individuals. They want control. The stock market is healthy.” The finance industry told people that all you had to do was invest in the stock market, wait for a long term, implied that that long term would end at the end of your working career and you would have enough to live on for the rest of your life. And that experiment is over: it failed. And just like the Great Depression, just like the policies proposed in the Great Depression that brought us Social Security, I think we’re at that point now where we have to rethink that experiment and rethink how we get people their valentines, their pension valentines.

JUAN GONZALEZ: When you say this experiment, I mean, there was an enormous shift in terms of the percents of employees who were getting what’s called defined benefit plans, as opposed to defined contributions. How did that happen? And how big was that shift?

GHILARDUCCI: Yeah. Well, in the 1970s, we passed a law that said that if companies were going to promise a pension, they had to fund it. That was ERISA. And that was a good idea. But then, only about 50 percent of Americans, at any one point in time, had a pension. But the pension was a traditional pension called the defined benefit pension. Even though half had it at the time, it meant that as people got older, they often got into jobs with those kinds of pensions.

GONZALEZ: And by defined benefit, that meant that they were guaranteed a certain income per month when they retired.

GHILARDUCCI: Yes, that’s right. It was based on years of service and on pay, so lower-income workers got less, higher-income workers got more. But that was fair. The point is that it was guaranteed for the rest of a person’s life. And that’s precisely what people want when they retire. They don’t want to be rich. They don’t want to make it big in the stock market. That was always seen as something you did in Las Vegas or with money on Wall Street, money that you could afford to lose. The idea is that pensions were supposed to be secure for the rest of your life.

And we now have a system where older people who are retired have Social Security and their pension on top of that, and we have the great success story in America, was that we went from the 1950s, where to be old meant that you had a high probability of being poor, to a situation now, even though it may be at risk, it may be over, where if you are old, you could actually count on some income. Thank goodness we have Social Security.

GOODMAN: Well, what about what are called the “entitlements.” In fact, Barack Obama referred to entitlements yesterday. What do you see is the future of Social Security, of these pensions?

GHILARDUCCI: Well, a comic said that George Bush’s best success was to try and privatize Social Security. And why that was funny was because it was his largest failure in his initiative for bold domestic policy. It meant that in 2005, when he tried to do that, that Americans realized how much they had at stake in Social Security. Barack Obama, I predict, just can’t touch that. There was a huge political movement against privatization, and that movement said, “Stop. We need this program.” I just can’t imagine Barack Obama going anywhere near that entitlement.

GONZALEZ: But there has been talk of the possibility of him creating some kind of a payroll deduction for—a 401(k)-type program for American workers on top of the Social Security, hasn’t there been?

GHILARDUCCI: I hope so, because that’s actually what I’m proposing. I’m proposing that we have a mandated, a universal supplement to Social Security. It’s not an old idea. It’s just something that I have been bold enough to suggest. It would be a supplement to Social Security, but it won’t be individually controlled. An individual won’t have to go out to retail, you know, mutual funds, pay these high and hidden fees, wouldn’t have to decide what kinds of investments to make, wouldn’t have to be exposed to the risk of the stock market. And most importantly, at the end of their working life, they would get a guaranteed annuity on top of Social Security. That’s what we need. We need a supplement to Social Security. And if he’s talking about that, I’m glad.

GONZALEZ: In terms of that, how would yours work? The money that would be contributed, where would it go?

GHILARDUCCI: What we would do is mandate that everyone add another five percent of savings on top of Social Security. That money would go into a government fund. It would be run much like the pension fund for federal employees are run now. This huge sovereign wealth fund would be dedicated to all Americans’ supplement to Social Security, and it would be invested in a broad portfolio of assets: government bonds, municipal bonds, infrastructure bonds, private equities, private stocks, emerging markets. But it would be professionally managed, again, much like my pension fund is and much like the federal employees’.

GOODMAN: Retirement age is going up. What is the significance of that?

GHILARDUCCI: It's going up because we had a lot of low-wage jobs being created. And so, Americans were working longer, and American women were especially working longer. What it means when you raise retirement age is usually it means that you’re cutting back pensions. And I don’t think it’s sustainable. There is no way that we can actually have a retirement system that’s based on having people work longer. We see now that in a recession that’s just ephemeral, it’s just a fantasy.

GOODMAN: I think the Labor statistics are going to come out later this morning, and we’re talking about a half-a-million more people being put on the unemployment rolls.

GHILARDUCCI: Yeah, it’s unimaginable, you know, that that rate is so large, but it does point to the idea -- is that we can’t have retirement policy based on people not retiring. That’s not a retirement policy.

GONZALEZ: To go back to your plan and the opposition to it by the financial community, they obviously would like to be able, if there is going to be some kind of a plan for additional employee savings, to manage those funds, right, and collect all the fees?

GHILARDUCCI: Absolutely.

GONZALEZ: It would be a huge payday for Wall Street.

GHILARDUCCI: Yeah, but it would be hugely inefficient. We actually had those experiments in Argentina and in Chile and in Peru. In Chile, Peru and Argentina, those experiments came about when there was a suspension of democracy, especially -- the most dramatic cases were in Chile and Peru. And we found out, after those twenty years, is that people are not retiring with enough money to live on, mainly because those private individual mutual funds, those little private companies, they charge fees that are too high. They have to provide profits to their shareholders, and they have to—they actually have to advertise. So it’s wildly inefficient.

So, my plan, any plan that requires employers and employees to save more for their retirement, we have to. That’s actually the fact. We’re going to live longer and retire. We do need to save more. But we can’t do it through these Wall Street boutique retail firms.

GOODMAN: It’s interesting you work at the New School, which is—the president is embattled. He is Bob Kerrey the former senator. And it was years ago -- he was a Democrat -- but heading the commission to look at privatizing Social Security.

GHILARDUCCI: And that commission rejected that proposal, because most anybody who’s practical looks at the issue, and privatizing is just not practical. It’s inefficient. It requires people to do what they can’t do, which is to bear the risk of their own retirement that they can’t control when they’re sixty-five and to face the financial markets.

AMY GOODMAN: Teresa Ghilarducci, I want to thank you very much for being with us, director of the Schwartz Center for Economic Policy Analysis at the School University. Her book is When I’m Sixty-Four: The Plot Against Pensions and the Plan to Save Them.

Obama Can Pump Trillions in the Economy, But No One Knows If It Will Work

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By Nicholas von Hoffman

The nation's hopes--even the world's--are riding on it, but Barack Obama's stimulus plan is no sure shot. Nobody can say if it will work.

Some questions to ponder: What has to happen for us to say that the stimulus worked? Would it be a success if half the people who have lost their jobs secure some kind of employment? Would the benchmark be that one-quarter or one-third or half of the trillions in lost retirement savings were rescued? Would keeping in place two-thirds of those in danger of losing their homes be enough for us to say the stimulus has worked? Or should the standard be the Dow Jones Industrial Average clawing its way back to 10,000?

Except in the vaguest terms, no criterion has been laid down for what the stimulus is supposed to accomplish. Perhaps none can be.

Economists who a couple of years ago disagreed about almost everything have come together to buy into the central part of the Obama stimulus approach that is putting lots of government money into anybody's hands who will spend it and get business rolling again. Overnight, after decades of being ignored and discarded, the ideas of John Maynard Keynes and Alvin Hansen, the two major economists of the 1930s New Deal era, make sense again.

In the seventy years since the Depression loosened its grip on America, economists and historians have argued over whether or not Keynes-Hansen deficit spending, or pump-priming, as it was called, succeeded. The jury is still out on that one, but the Keynes-Hansen approach has been dusted off and even the stiffest opponents of deficit spending have abandoned the closely held principles of their professional lifetimes.

One such former opponent is Harvard's Martin Feldstein, chair of the Council of Economic Advisors in the Reagan administration and someone whose career has been spent in antipodean opposition to anything that smacked of Keynesianism. Things are so bad, in Feldstein's opinion, that he has put himself on record as saying there is no choice but to grab the buckets and pour water into the pump until America's distressed economy starts to chug again.

The pump, however, may be seized up. We do not know if, when money is put into millions of people's hands, they will spend it. After all, the middle-class segment of the baby boomer generation has just seen its retirement savings all but wiped out. These people, with retirement coming up fast, may be of a mind to save every cent they can get their hands on.

In the 1930s, when a reluctant Franklin Roosevelt decided to try Keynes-Hansen deficit spending, the overall situation was different from the one we are trying to live through. The leaning towers of debt built up during the crazy 1920s had collapsed by 1934. Thousands of banks had gone under, taking the savings of countless people with them. Bankruptcy had carried away debt-ridden, weak companies and individuals. Farmers were thrown off their land when they could not make their mortgage payments; city and suburban families lost their homes.

The deficit spending of the 1930s began in a society that was, thanks to massive bankruptcies, an economic tabula rasa. It had been reduced to near ruins, but in the process debt was swept away. In 2009, quite the contrary is the case.

Our current financial system is waterlogged with debt. Countless numbers of nonfinancial companies have the lead weight of indebtedness dragging them down, and personal debt is doing the same to the millions of individuals stuck with mortgages now worth more than their homes. No tabula rasa here, no debt-free new beginnings--and that raises a question: will the Obama plan be a stimulus to higher levels of economic activity or a life-support system maintaining an economically comatose patient?

We could go another way. We could sweep the table clean of debt by allowing massive bankruptcy to proceed for companies and individuals, a national liquidation. This was the plan advocated by Andrew Mellon, Herbert Hoover's treasury secretary.

Something like that had worked in the recession of 1920. The pain was sharp but short. In a few months the recession was over, and the nation was off into the Jazz Age. In 1933 the pain was sharp but hardly short. Government action not unlike what the Bush administration has been doing may have stopped the process from completing itself.

Stepping back and allowing bankruptcies to roll could not be contemplated without creating a huge program to keep the millions who would lose their jobs in their homes, fed and clothed. The politics of the Mellon approach are too horrendous to bear thinking about, so economists of every stripe, starting as far right as Feldstein and as far as left Paul Krugman, have no choice but to fall back on Keynes-Hansen.

Now let's see if it works.

U.S. Payrolls Post Biggest Annual Drop Since 1945

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By Shobhana Chandra

The U.S. lost more jobs in 2008 than any year since 1945 as employers fired another 524,000 people in December, indicating a free-fall in the economy just days before President-elect Barack Obama takes office.

“Consumers are now going to get more and more scared at the prospect of losing their job,” said Nariman Behravesh, chief economist at IHS Global Insight in Lexington, Massachusetts. Obama’s proposed fiscal stimulus “needs to be big, needs to be bold, needs to be swift. If they can do something quickly we can limit the hemorrhage by mid-year.”

The Labor Department reported that the nation lost 2.589 million jobs in 2008, with the unemployment rate climbing more than economists forecast, to a 15-year high of 7.2 percent in December.

Today’s figures will intensify pressure on U.S. lawmakers to speed Obama’s recovery program, which may exceed $775 billion, through Congress in an effort to save or create 3 million jobs. They also underscore the urgency of the Federal Reserve’s $200 billion initiative to restart consumer financing markets that’s scheduled to begin next month.

The outlook for jobs this year is no brighter as retailers from Wal-Mart Stores Inc. to Macy’s Inc. slash profit forecasts and manufacturers including Alcoa Inc. cut output and staff.

Stocks, Treasuries

Stock-index futures rose and Treasuries fell amid relief among some investors that the drop in payrolls wasn’t even bigger. Futures on the Standard & Poor’s 500 Stock Index rose 0.4 percent to 910.70 at 9:10 a.m. in New York, and yields on benchmark 10-year notes were at 2.47 percent, from 2.44 percent late yesterday. The dollar gained 1 percent to $1.3568 per euro.

Payrolls were forecast to drop 525,000 after a previously reported 533,000 decline in November, according to the median estimate of 73 economists surveyed by Bloomberg News. Revisions subtracted 154,000 from payroll figures previously reported for November and October.

The jobless rate was projected to jump to 7 percent from a previously reported 6.7 percent in November.

Obama is pressing for a stimulus plan including tax cuts and spending on everything from roads and schools to the energy network. Yesterday he called for “dramatic action as soon as possible” to help pull the world’s largest economy out of a slump that’s in its second year. “If nothing is done, this recession could linger for years,” he said in Fairfax, Virginia.

Benchmark Revisions

With today’s report, Labor revised figures from its household survey, which includes the unemployment rate, going back five years. Benchmark revisions to the payroll figures will be announced in February.

Last month’s decline was the 12th consecutive drop in payrolls. The economy created 1.1 million jobs in 2007.

Today’s report showed factory payrolls shrank 149,000, the biggest drop since August 2001, after decreasing 104,000 in November. Economists had forecast a drop of 100,000.

The decrease included a loss of 21,400 jobs in auto and parts industries. Manufacturing, which makes up 12 percent of the economy, shrank in December at the fastest pace in 28 years, Institute for Supply Management figures showed.

Payrolls at builders dropped by 101,000 after decreasing 85,000. Financial firms reduced payrolls by 14,000, after a 28,000 loss the prior month.

Services Jobs

Service industries, which include banks, insurance companies, restaurants and retailers, subtracted 273,000 workers after a decline of 402,000. Retail payrolls dropped by 66,600 after a 100,000 decrease.

Government payrolls increased by 7,000 after falling 3,000 the prior month.

Fed staff last month cut projections for gross domestic product and the job market, stating the unemployment rate was “likely to rise significantly into 2010,” according to minutes of policy makers’ December meeting.

Analysts said the economy may be in danger of a reinforcing cycle of rising unemployment and declining household spending, what policy makers call a negative feedback loop, which is difficult to snap once it’s begun.

“This was the most rapid deterioration in the labor market over a six-month period since 1975,” said Michael Darda, chief economist at MKM Partners LP in Greenwich, Connecticut. “Policy makers will go full throttle” until “the labor market starts to turn,” he said.

Wal-Mart, the world’s biggest retail chain, yesterday said fourth-quarter profit will miss its earlier forecasts after sales rose less than analysts anticipated. Macy’s said December revenue slipped 4 percent and announced it would close 11 stores.

Retail Sales

Sales at stores open at least a year dropped 2.2 percent in the last two month months of 2008, the biggest holiday-season decline since the International Council of Shopping Centers started keeping records in 1970, the group said yesterday.

“These are extraordinary times, requiring speed and decisiveness to address the current economic downturn,” Klaus Kleinfeld, chief executive officer of Alcoa, said in a Jan. 6 statement announcing 13,500 job cuts worldwide. The world’s largest aluminum producer said it will trim an additional 1,700 contractor positions and froze hiring and salaries in some areas.

Some companies have taken other steps to lower costs. Caterpillar Inc., the world’s largest maker of construction equipment, will put 814 workers on an “indefinite” layoff, shipper FedEx Corp. cut the pay of Chief Executive Officer Fred Smith and other employees, and auto-parts supplier Visteon Corp. said it will trim the workweek and some salaries.

The average work week shrank to a record-low 33.3 hours from 33.5 hours, today’s figures showed. Average weekly hours worked by production workers dropped to 39.9 hours from 40.3 hours, while overtime decreased to 3 hours from 3.3 hours. That brought the average weekly earnings down by $2 to $611.39.

Workers’ average hourly wages rose 5 cents, or 0.3 percent, to $18.36 from the prior month. Hourly earnings were 3.7 percent higher than December 2007. Economists surveyed by Bloomberg had forecast a 0.2 percent increase from November and a 3.6 percent gain for the 12-month period.