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By Carrie Johnson
Investigators disrupted an improbable plan to assassinate Sen. Barack Obama and kill 102 other African Americans in a spree fueled by white supremacist ideology, officials at the Bureau of Alcohol, Tobacco and Firearms said yesterday.
Federal prosecutors in Jackson, Tenn., unsealed a criminal complaint charging two men with conspiracy, possession of an unregistered sawed-off shotgun and making threats against a presidential candidate. Daniel Cowart, 20, and Paul Schlesselman, 18, remain in federal custody.
The men met online nearly a month ago through a mutual friend who was not identified in court papers. Their chats intensified and their scheme took shape, according to a sworn statement by ATF agent Brian A. Weeks.
Using a .308-caliber rifle and a high-powered weapon they planned to steal from a gun store, the men plotted to "drive their vehicle as fast as they could toward Obama shooting at him from the windows," the affidavit said. "Both individuals stated they would dress in all white tuxedos and wear top hats during the assassination attempt."
Cowart traveled from Tennessee to Arkansas to pick up Schlesselman at his residence Oct. 20. From there, they planned to rob a gun shop, target a predominately African American school and ultimately attack Obama (D-Ill.), who is leading in most national polls in his bid for the White House.
The far-fetched plot soon fell apart, however. The day after they met in person, the men attempted to rob a home in Bells, Tenn., only to be deterred when they spotted a dog and two vehicles on the premises, Weeks wrote.
On Oct. 22, while driving around randomly, they shot a window out of the Church of Christ of Beech Grove in Brownsville, Tenn., then returned to Cowart's grandfather's house, according to court papers. The same day, they purchased chalk and drew swastikas and other "racially motivated words and symbols" on the hood of their car, court papers said. The Crockett County sheriff took the men into custody that night.
Authorities recovered a short-barreled shotgun, two handguns, a rifle and ammunition, they reported.
"It is critical that the alleged plot was interrupted," said James Cavanaugh, special agent in charge of the ATF's Nashville office.
Richard Harlow, special agent in charge of the Memphis field office of the U.S. Secret Service, said the agency "takes all threats against presidential candidates seriously."
Joe H. Byrd Jr., an attorney for Cowart, said that he was investigating the facts and circumstances of the case and had no further comment. A spokeswoman for the federal public defender's office in Jackson, which is representing Schlesselman, declined to comment.
Both men are scheduled to appear again in court Thursday for a detention hearing, said Lawrence J. Laurenzi, acting U.S. attorney for the Western District of Tennessee.
Tuesday, October 28, 2008
PM Putin suggests Russia, China ditch dollar in trade deals
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October 28 (RIA Novosti) - Russian Prime Minister Vladimir Putin proposed on Tuesday that Russia and China gradually switch over to national currency payments in bilateral trade, expected to total $50 billion in 2008.
"We should consider improving the payment system for bilateral trade, including by gradually adopting a broader use of national currencies," Putin told a bilateral economic forum.
He admitted the task would be tough, but said it was necessary amid the current problems with the dollar-based global economy.
Chinese Prime Minister Wen Jiabao described strengthening bilateral relations as "strategic."
"Mutual investment by Russia and China has already exceeded $2 billion, this is a very good index," Jiabao said.
He praised the success of numerous projects, including additional construction of China's Tianwan nuclear power plant and the opening of a joint pharmaceuticals center in Moscow.
A number of large Russian companies, including state-run oil producer Rosneft and aluminum champion RusAl, are seeking to develop investment projects in China, Jiabao said.
The Chinese premier said bilateral cooperation in the helicopter industry, mechanical engineering, the energy sector, timber production and innovation sector was also showing signs of progress.
"China is a staunch supporter of Russia's accession to the WTO, but is categorically against politicizing the issue," Jiabao said.
The Russian premier invited Chinese investors to join Russian timber projects.
"We welcome both domestic and foreign investment in Russia's timber sector," Putin said. "As one of the largest consumers of our products, China could be a source of such investment."
He also offered Beijing Russia's assistance in developing a large passenger plane on the basis of Russia's experience with its wide-bodied Il-96 aircraft.
October 28 (RIA Novosti) - Russian Prime Minister Vladimir Putin proposed on Tuesday that Russia and China gradually switch over to national currency payments in bilateral trade, expected to total $50 billion in 2008.
"We should consider improving the payment system for bilateral trade, including by gradually adopting a broader use of national currencies," Putin told a bilateral economic forum.
He admitted the task would be tough, but said it was necessary amid the current problems with the dollar-based global economy.
Chinese Prime Minister Wen Jiabao described strengthening bilateral relations as "strategic."
"Mutual investment by Russia and China has already exceeded $2 billion, this is a very good index," Jiabao said.
He praised the success of numerous projects, including additional construction of China's Tianwan nuclear power plant and the opening of a joint pharmaceuticals center in Moscow.
A number of large Russian companies, including state-run oil producer Rosneft and aluminum champion RusAl, are seeking to develop investment projects in China, Jiabao said.
The Chinese premier said bilateral cooperation in the helicopter industry, mechanical engineering, the energy sector, timber production and innovation sector was also showing signs of progress.
"China is a staunch supporter of Russia's accession to the WTO, but is categorically against politicizing the issue," Jiabao said.
The Russian premier invited Chinese investors to join Russian timber projects.
"We welcome both domestic and foreign investment in Russia's timber sector," Putin said. "As one of the largest consumers of our products, China could be a source of such investment."
He also offered Beijing Russia's assistance in developing a large passenger plane on the basis of Russia's experience with its wide-bodied Il-96 aircraft.
Home prices fall by sharpest annual rate ever
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Standard & Poor’s/Case-Shiller price index off by record 16.6 percent
Home prices tumbled by the sharpest annual rate ever in August, with little indication of a turnaround in sight, a closely watched index showed Tuesday.
The Standard & Poor's/Case-Shiller 20-city housing index dropped a record 16.6 percent from August last year, the largest drop since its inception in 2000. The 10-city index plunged 17.7 percent, its biggest decline in its 21-year history.
Both indices have recorded year-over-year declines for 20 consecutive months.
"The downturn in residential real estate prices continued, with very few bright spots in the data," said David M. Blitzer, chairman of the index committee at S&P.
Prices in the 20-city index have plummeted more than 20 percent since peaking in July 2006. The 10-city index has fallen nearly 22 percent since its peak in June 2006.
No city in the Case-Shiller 20-city index saw annual price gains in August — for the fifth straight month.
However, the pace of monthly declines did moderate last month from July, and Boston and Cleveland showed monthly gains from July to August.
Boston, the first city to post price declines in the 20-city index starting in October 2005, has recorded five straight monthly gains in home values.
But on the other hand, Dallas and Denver both showed negative returns in August after four consecutive months of increases.
Price declines in Las Vegas and Phoenix surpassed 30 percent in August, according to Case-Shiller, while prices in Miami, Los Angeles, San Francisco and San Diego all plunged more than 25 percent.
Home prices likely won't improve in September either as other key housing indicators have shown the housing slump still in full swing. Recent data the government and the National Association of Realtors showed the median prices for new and existing homes both tumbled by 9 percent in September.
Standard & Poor’s/Case-Shiller price index off by record 16.6 percent
Home prices tumbled by the sharpest annual rate ever in August, with little indication of a turnaround in sight, a closely watched index showed Tuesday.
The Standard & Poor's/Case-Shiller 20-city housing index dropped a record 16.6 percent from August last year, the largest drop since its inception in 2000. The 10-city index plunged 17.7 percent, its biggest decline in its 21-year history.
Both indices have recorded year-over-year declines for 20 consecutive months.
"The downturn in residential real estate prices continued, with very few bright spots in the data," said David M. Blitzer, chairman of the index committee at S&P.
Prices in the 20-city index have plummeted more than 20 percent since peaking in July 2006. The 10-city index has fallen nearly 22 percent since its peak in June 2006.
No city in the Case-Shiller 20-city index saw annual price gains in August — for the fifth straight month.
However, the pace of monthly declines did moderate last month from July, and Boston and Cleveland showed monthly gains from July to August.
Boston, the first city to post price declines in the 20-city index starting in October 2005, has recorded five straight monthly gains in home values.
But on the other hand, Dallas and Denver both showed negative returns in August after four consecutive months of increases.
Price declines in Las Vegas and Phoenix surpassed 30 percent in August, according to Case-Shiller, while prices in Miami, Los Angeles, San Francisco and San Diego all plunged more than 25 percent.
Home prices likely won't improve in September either as other key housing indicators have shown the housing slump still in full swing. Recent data the government and the National Association of Realtors showed the median prices for new and existing homes both tumbled by 9 percent in September.
The End of International Law?
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By Robert Dreyfuss
A parallel new Bush doctrine is emerging, in the last days of the soon-to-be-ancien regime, and it needs to be strangled in its crib. Like the original Bush doctrine -- the one that Sarah Palin couldn't name, which called for preventive military action against emerging threats -- this one also casts international law aside by insisting that the United States has an inherent right to cross international borders in "hot pursuit" of anyone it doesn't like.
They're already applying it to Pakistan, and this week Syria was the target. Is Iran next?
Let's take Pakistan first. Though a nominal ally, Pakistan has been the subject of at least nineteen aerial attacks by CIA-controlled drone aircraft, killing scores of Pakistanis and some Afghans in tribal areas controlled by pro-Taliban forces. The New York Times listed, and mapped, all nineteen such attacks in a recent piece describing Predator attacks across the Afghan border, all since August. The Times notes that inside the government, the U.S.Special Operations command and other advocates are pushing for a more aggressive use of such units, including efforts to kidnap and interrogate suspected Taliban and Al Qaeda leaders. Though President Bush signed an order in July allowing U.S. commando teams to move into Pakistan itself, with or without Islamabad's permission, such raids have occurred only once, on September 3.
The U.S. raid into Syria on October 26 similarly trampled on Syria's sovereignty without so much as a fare-thee-well. Though the Pentagon initially denied that the raid involved helicopters and on-the-ground commando presence, that's exactly what happened. The attack reportedly killed Badran Turki Hishan al-Mazidih, an Iraqi facilitator who smuggled foreign fighters into Iraq through Syria. The Washington Post was ecstatic, writing in an editorial:
"If Sunday's raid, which targeted a senior al-Qaeda operative, serves only to put Mr. Assad on notice that the United States, too, is no longer prepared to respect the sovereignty of a criminal regime, it will have been worthwhile."
Is it really that easy? To say: We declare your regime criminal, and so we will attack you anytime we care to? In its news report of the attack into Syria, the Post suggests, in a report by Ann Scott Tyson and Ellen Knickmeyer, that the attack is raising cross-border hot pursuit to the level of a doctrine:
"The military's argument is that 'you can only claim sovereignty if you enforce it,' said Anthony Cordesman, a military analyst at the Center for Strategic and International Studies. 'When you are dealing with states that do not maintain their sovereignty and become a de facto sanctuary, the only way you have to deal with them is this kind of operation,' he said."
The Times broadens the possible targets from Pakistan and Syria to Iran, writing (in a page one story by Eric Schmitt and Thom Shanker):
"Administration officials declined to say whether the emerging application of self-defense could lead to strikes against camps inside Iran that have been used to train Shiite 'special groups' that have fought with the American military and Iraqi security forces."
That, of course, has been a live option, especially since the start of the surge in January, 2007, when President Bush promised to strike at Iranian supply lines in Iraq and other U.S. officials, including Vice President Cheney, pressed hard to attack sites within Iran, regardless of the consequences.
On October 24, I went to hear Mike Vickers, the assistant secretary of defense for special operations and low-intensity conflict, speaking at the Washington Institiute for Near East Policy (WINEP), a pro-Israeli thinktank in Washington. He spoke with pride about the vast and growing presence of these commando forces within the U.S. military, noting that their budget has doubled under the Bush administration and that, by the end of the decade, their will more than 60,000 U.S. forces in this shadowy effort. Here are some excerpts of Vickers' remarks:
"If you look at the operational core of our Special Operations Forces, and focus on the ground operators, there are some 15,000 or so of those -- give or take how you count them -- these range from our Army Special Forces or our Green Berets, our Rangers, our Seals, some classified units we have, and we recently added a Marine Corps Special Operations Command to this arsenal as well. In addition to adding the Marine component, each of these elements since 2006 and out to about 2012 or 2013 has been increasing their capacity as well as their capabilities, but their capacity by a third. This is the largest growth in Special Operations Force history. By the time we're done with that, there will be some things, some gaps we need to fix undoubtedly, but we will have the elements in place for what we believe is the Special Operations component of the global war on terrorism.
"Special Operations Forces, I think through this decade and into the next one, have been and will remain a decisive strategic instrument. ...
"There's been a very significant -- about a 40 or 50 percent increase in operational tempo and of course more intense in terms of the action since the 9/11 attacks. On any given day that we wake up, our Special Operations Forces are in some sixty countries around the world. But more than 80 percent or so of those right now are concentrated in the greater Middle East or the United States Central Command area of responsibility -- the bulk of those of course in Iraq and Afghanistan."
Notice what he said: operating in 60 countries.
Of course, the very invasion of Iraq was illegal in 2003, and it flouted international law. So some may say, these cross-border raids are small potatoes. But they're not. This is a big deal. If it becomes a standard part of U.S. military doctrine that any country can be declared "criminal" and thus lose its sovereignty, then there is no such thing as international law anymore.
When Defense Secretary Robert Gates was asked about this, here's what he said, as quoted in the Post article cited earlier:
"'We will do what is necessary to protect our troops,' Defense Secretary Robert M. Gates said in Senate testimony last month, when asked about the cross-border operations. Under questioning, Gates said that he was not an expert in international law but that he assumed the State Department had consulted such laws before the U.S. military was granted authority to make such strikes."
Not an expert in international law? He'll leave it to the State Department? And this is the guy that Barack Obama's advisers say ought to stay on at the Pentagon under an Obama administration?
By Robert Dreyfuss
A parallel new Bush doctrine is emerging, in the last days of the soon-to-be-ancien regime, and it needs to be strangled in its crib. Like the original Bush doctrine -- the one that Sarah Palin couldn't name, which called for preventive military action against emerging threats -- this one also casts international law aside by insisting that the United States has an inherent right to cross international borders in "hot pursuit" of anyone it doesn't like.
They're already applying it to Pakistan, and this week Syria was the target. Is Iran next?
Let's take Pakistan first. Though a nominal ally, Pakistan has been the subject of at least nineteen aerial attacks by CIA-controlled drone aircraft, killing scores of Pakistanis and some Afghans in tribal areas controlled by pro-Taliban forces. The New York Times listed, and mapped, all nineteen such attacks in a recent piece describing Predator attacks across the Afghan border, all since August. The Times notes that inside the government, the U.S.Special Operations command and other advocates are pushing for a more aggressive use of such units, including efforts to kidnap and interrogate suspected Taliban and Al Qaeda leaders. Though President Bush signed an order in July allowing U.S. commando teams to move into Pakistan itself, with or without Islamabad's permission, such raids have occurred only once, on September 3.
The U.S. raid into Syria on October 26 similarly trampled on Syria's sovereignty without so much as a fare-thee-well. Though the Pentagon initially denied that the raid involved helicopters and on-the-ground commando presence, that's exactly what happened. The attack reportedly killed Badran Turki Hishan al-Mazidih, an Iraqi facilitator who smuggled foreign fighters into Iraq through Syria. The Washington Post was ecstatic, writing in an editorial:
"If Sunday's raid, which targeted a senior al-Qaeda operative, serves only to put Mr. Assad on notice that the United States, too, is no longer prepared to respect the sovereignty of a criminal regime, it will have been worthwhile."
Is it really that easy? To say: We declare your regime criminal, and so we will attack you anytime we care to? In its news report of the attack into Syria, the Post suggests, in a report by Ann Scott Tyson and Ellen Knickmeyer, that the attack is raising cross-border hot pursuit to the level of a doctrine:
"The military's argument is that 'you can only claim sovereignty if you enforce it,' said Anthony Cordesman, a military analyst at the Center for Strategic and International Studies. 'When you are dealing with states that do not maintain their sovereignty and become a de facto sanctuary, the only way you have to deal with them is this kind of operation,' he said."
The Times broadens the possible targets from Pakistan and Syria to Iran, writing (in a page one story by Eric Schmitt and Thom Shanker):
"Administration officials declined to say whether the emerging application of self-defense could lead to strikes against camps inside Iran that have been used to train Shiite 'special groups' that have fought with the American military and Iraqi security forces."
That, of course, has been a live option, especially since the start of the surge in January, 2007, when President Bush promised to strike at Iranian supply lines in Iraq and other U.S. officials, including Vice President Cheney, pressed hard to attack sites within Iran, regardless of the consequences.
On October 24, I went to hear Mike Vickers, the assistant secretary of defense for special operations and low-intensity conflict, speaking at the Washington Institiute for Near East Policy (WINEP), a pro-Israeli thinktank in Washington. He spoke with pride about the vast and growing presence of these commando forces within the U.S. military, noting that their budget has doubled under the Bush administration and that, by the end of the decade, their will more than 60,000 U.S. forces in this shadowy effort. Here are some excerpts of Vickers' remarks:
"If you look at the operational core of our Special Operations Forces, and focus on the ground operators, there are some 15,000 or so of those -- give or take how you count them -- these range from our Army Special Forces or our Green Berets, our Rangers, our Seals, some classified units we have, and we recently added a Marine Corps Special Operations Command to this arsenal as well. In addition to adding the Marine component, each of these elements since 2006 and out to about 2012 or 2013 has been increasing their capacity as well as their capabilities, but their capacity by a third. This is the largest growth in Special Operations Force history. By the time we're done with that, there will be some things, some gaps we need to fix undoubtedly, but we will have the elements in place for what we believe is the Special Operations component of the global war on terrorism.
"Special Operations Forces, I think through this decade and into the next one, have been and will remain a decisive strategic instrument. ...
"There's been a very significant -- about a 40 or 50 percent increase in operational tempo and of course more intense in terms of the action since the 9/11 attacks. On any given day that we wake up, our Special Operations Forces are in some sixty countries around the world. But more than 80 percent or so of those right now are concentrated in the greater Middle East or the United States Central Command area of responsibility -- the bulk of those of course in Iraq and Afghanistan."
Notice what he said: operating in 60 countries.
Of course, the very invasion of Iraq was illegal in 2003, and it flouted international law. So some may say, these cross-border raids are small potatoes. But they're not. This is a big deal. If it becomes a standard part of U.S. military doctrine that any country can be declared "criminal" and thus lose its sovereignty, then there is no such thing as international law anymore.
When Defense Secretary Robert Gates was asked about this, here's what he said, as quoted in the Post article cited earlier:
"'We will do what is necessary to protect our troops,' Defense Secretary Robert M. Gates said in Senate testimony last month, when asked about the cross-border operations. Under questioning, Gates said that he was not an expert in international law but that he assumed the State Department had consulted such laws before the U.S. military was granted authority to make such strikes."
Not an expert in international law? He'll leave it to the State Department? And this is the guy that Barack Obama's advisers say ought to stay on at the Pentagon under an Obama administration?
Europe's secret plan to boost GM crop production
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By Geoffrey Lean
Gordon Brown and other EU leaders in campaign to promote modified foods
Gordon Brown and other European leaders are secretly preparing an unprecedented campaign to spread GM crops and foods in Britain and throughout the continent, confidential documents obtained by The Independent on Sunday reveal.
The documents – minutes of a series of private meetings of representatives of 27 governments – disclose plans to "speed up" the introduction of the modified crops and foods and to "deal with" public resistance to them.
And they show that the leaders want "agricultural representatives" and "industry" – presumably including giant biotech firms such as Monsanto – to be more vocal to counteract the "vested interests" of environmentalists.
News of the secret plans is bound to create a storm of protest at a time when popular concern about GM technology is increasing, even in countries that have so far accepted it.
Public opposition has prevented any modified crops from being grown in Britain. France, one of only three countries in Europe to have grown them in any amounts, has suspended their cultivation, and resistance to them is rising rapidly in the other two, Spain and Portugal.
The embattled biotech industry has been conducting a public relations campaign based round the highly contested assertion that genetic modification is needed to feed the world. It has had some success in the Government, where ministers have been increasingly speaking out in favour of the technology, and in the European Commission, with which its lobbyists have boasted of having "excellent working relations".
The secret meetings were convened by Jose Manuel Barroso, the pro-GM President of the Commission, and chaired by his head of cabinet, Joao Vale de Almeida. The prime ministers of each of the EU's 27 member states were asked to nominate a special representative.
Neither the membership of the group, nor its objectives, nor the outcomes of its meetings have been made public. But The IoS has obtained confidential documents, including an attendance list and the conclusions of the two meetings held so far – on 17 July and just two weeks ago on 10 October – written by the chairman.
The list shows that President Nicolas Sarkozy of France and Chancellor Angela Merkel of Germany sent close aides. Britain was represented by Sonia Phippard, director for food and farming at the Department of Environment, Food and Rural Affairs.
The conclusions reveal the discussions were mainly preoccupied with how to speed up the introduction of GM crops and food and how to persuade the public to accept them.
The modified products have to be approved by the EU before they can be sown or sold anywhere in Europe. But though the Commission officials are generally strongly in favour, European governments are split, causing the Council of Ministers, on which they are represented, to be deadlocked.
In that event the bureaucrats on the Commission wave them through anyway. They are legally allowed to do this, but overruled governments and environmental groups are unhappy.
The conclusions of the first meeting called for the "speeding up of the authorisation process based on robust assessments so as to reassure the public", while the second one added: "Decisions could be made faster without compromising safety."
But the documents also make clear that Mr Barroso is going beyond mere exhortation by trying to get prime ministers to overrule their own agriculture and environment ministers in favour of GM. They report that the chairman "recalled the importance for prime ministers to look at the wider picture", "invited the participants to report the discussions of the group to their heads of governments", and "stressed the importance of drawing their attention to ongoing discussions in the Council [of Ministers]".
Helen Holder of Friends of the Earth Europe said: "Barroso's aim is to get GM into Europe as quickly as possible. So he is going straight to prime ministers and presidents to tell them to step on their ministers and get them into line."
The conclusions of the meetings on public opposition are even more incendiary. The documents ponder "how best to deal with public opinion" and call for "an emotion-free, fact-based dialogue on the high standards of the EU GM policy". And they record the chairman emphasising "the role of industry, economic partners and science to actively contribute to such a dialogue". He adds that "the public feels ill-informed" and says "agricultural representatives should be more vocal". And in a veiled swipe at environmental groups he says that the debate "should not be left to certain stakeholders who have a legitimate but vested interest in it".
What they say
'We have to feed an extra 2.5 billion people. It would be extraordinary if we chose not to exploit the most important breakthrough in biological science'
Professor Allan Buckwell
'New developments will benefit the world's poorest farmers: GM rice that is drought-resistant; transgenic crops with genes to protect against disease'
Lord Dick Taverne, Sense About Science
'GM crops pose unacceptable risks to farmers and the environment and have failed to increase yields despite funding at a cost of millions to UK taxpayers'
Kirtana Chandrasekaran, FoE
'GM crops do not increase yields. Scientists have found genetically engineered insecticide in crops can leak and kill beneficial soil fungi'
Peter Melchett, Soil Association
Q & A: The trouble with modified crops
How much GM is grown in Europe?
Very little. The documents boast the area increased by 21 per cent last year, proving "growing interest". But it still only covered 0.119 per cent of Europe's agricultural land.
What are the problems?
Mainly environmental. Official trials in Britain showed that growing GM crops was worse for wildlife than cultivating conventional ones. Worse, genes escape from the modified plants to create superweeds and to contaminate normal and organic crops, denying consumers a choice to be GM-free.
Do they endanger health?
Hard to tell. Some studies show that they may do, others (including almost all those by industry) are reassuring. The trouble is that very few truly independent, peer-reviewed research has been done. Most consumers have sensibly concluded that they would sooner be safe than sorry, particularly as they get no benefit from buying GM.
Can they feed the world?
Almost certainly not. Despite all the hype, present GM varieties actually have lower yields than their conventional counterparts. The seeds are expensive to buy and grow, so wealthy developing-world farmers would tend to use them and drive poor ones out of business, increasing destitution. The biggest agricultural assessment ever conducted – chaired by Professor Robert Watson, now Defra's chief scientist – recently concluded that they would not do the job.
By Geoffrey Lean
Gordon Brown and other EU leaders in campaign to promote modified foods
Gordon Brown and other European leaders are secretly preparing an unprecedented campaign to spread GM crops and foods in Britain and throughout the continent, confidential documents obtained by The Independent on Sunday reveal.
The documents – minutes of a series of private meetings of representatives of 27 governments – disclose plans to "speed up" the introduction of the modified crops and foods and to "deal with" public resistance to them.
And they show that the leaders want "agricultural representatives" and "industry" – presumably including giant biotech firms such as Monsanto – to be more vocal to counteract the "vested interests" of environmentalists.
News of the secret plans is bound to create a storm of protest at a time when popular concern about GM technology is increasing, even in countries that have so far accepted it.
Public opposition has prevented any modified crops from being grown in Britain. France, one of only three countries in Europe to have grown them in any amounts, has suspended their cultivation, and resistance to them is rising rapidly in the other two, Spain and Portugal.
The embattled biotech industry has been conducting a public relations campaign based round the highly contested assertion that genetic modification is needed to feed the world. It has had some success in the Government, where ministers have been increasingly speaking out in favour of the technology, and in the European Commission, with which its lobbyists have boasted of having "excellent working relations".
The secret meetings were convened by Jose Manuel Barroso, the pro-GM President of the Commission, and chaired by his head of cabinet, Joao Vale de Almeida. The prime ministers of each of the EU's 27 member states were asked to nominate a special representative.
Neither the membership of the group, nor its objectives, nor the outcomes of its meetings have been made public. But The IoS has obtained confidential documents, including an attendance list and the conclusions of the two meetings held so far – on 17 July and just two weeks ago on 10 October – written by the chairman.
The list shows that President Nicolas Sarkozy of France and Chancellor Angela Merkel of Germany sent close aides. Britain was represented by Sonia Phippard, director for food and farming at the Department of Environment, Food and Rural Affairs.
The conclusions reveal the discussions were mainly preoccupied with how to speed up the introduction of GM crops and food and how to persuade the public to accept them.
The modified products have to be approved by the EU before they can be sown or sold anywhere in Europe. But though the Commission officials are generally strongly in favour, European governments are split, causing the Council of Ministers, on which they are represented, to be deadlocked.
In that event the bureaucrats on the Commission wave them through anyway. They are legally allowed to do this, but overruled governments and environmental groups are unhappy.
The conclusions of the first meeting called for the "speeding up of the authorisation process based on robust assessments so as to reassure the public", while the second one added: "Decisions could be made faster without compromising safety."
But the documents also make clear that Mr Barroso is going beyond mere exhortation by trying to get prime ministers to overrule their own agriculture and environment ministers in favour of GM. They report that the chairman "recalled the importance for prime ministers to look at the wider picture", "invited the participants to report the discussions of the group to their heads of governments", and "stressed the importance of drawing their attention to ongoing discussions in the Council [of Ministers]".
Helen Holder of Friends of the Earth Europe said: "Barroso's aim is to get GM into Europe as quickly as possible. So he is going straight to prime ministers and presidents to tell them to step on their ministers and get them into line."
The conclusions of the meetings on public opposition are even more incendiary. The documents ponder "how best to deal with public opinion" and call for "an emotion-free, fact-based dialogue on the high standards of the EU GM policy". And they record the chairman emphasising "the role of industry, economic partners and science to actively contribute to such a dialogue". He adds that "the public feels ill-informed" and says "agricultural representatives should be more vocal". And in a veiled swipe at environmental groups he says that the debate "should not be left to certain stakeholders who have a legitimate but vested interest in it".
What they say
'We have to feed an extra 2.5 billion people. It would be extraordinary if we chose not to exploit the most important breakthrough in biological science'
Professor Allan Buckwell
'New developments will benefit the world's poorest farmers: GM rice that is drought-resistant; transgenic crops with genes to protect against disease'
Lord Dick Taverne, Sense About Science
'GM crops pose unacceptable risks to farmers and the environment and have failed to increase yields despite funding at a cost of millions to UK taxpayers'
Kirtana Chandrasekaran, FoE
'GM crops do not increase yields. Scientists have found genetically engineered insecticide in crops can leak and kill beneficial soil fungi'
Peter Melchett, Soil Association
Q & A: The trouble with modified crops
How much GM is grown in Europe?
Very little. The documents boast the area increased by 21 per cent last year, proving "growing interest". But it still only covered 0.119 per cent of Europe's agricultural land.
What are the problems?
Mainly environmental. Official trials in Britain showed that growing GM crops was worse for wildlife than cultivating conventional ones. Worse, genes escape from the modified plants to create superweeds and to contaminate normal and organic crops, denying consumers a choice to be GM-free.
Do they endanger health?
Hard to tell. Some studies show that they may do, others (including almost all those by industry) are reassuring. The trouble is that very few truly independent, peer-reviewed research has been done. Most consumers have sensibly concluded that they would sooner be safe than sorry, particularly as they get no benefit from buying GM.
Can they feed the world?
Almost certainly not. Despite all the hype, present GM varieties actually have lower yields than their conventional counterparts. The seeds are expensive to buy and grow, so wealthy developing-world farmers would tend to use them and drive poor ones out of business, increasing destitution. The biggest agricultural assessment ever conducted – chaired by Professor Robert Watson, now Defra's chief scientist – recently concluded that they would not do the job.
Interventionism, Not Muslims, Is the Problem
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By Jacob G. Hornberger
One of the popular post-9/11 sentiments has been the one that holds that Muslims are bent on conquering the world. The notion is that Muslims hate Christianity and Western freedom and values and that such hatred is rooted in the Koran and stretches back centuries. Thus, the United States has been drawn, reluctantly, into a war against Muslims. That’s why U.S. forces are in Iraq and Afghanistan, the argument goes — to defend our freedoms by killing Muslims over there before they get over here and kill us.
I sometimes wonder whether the people who have this mindset have reflected on the ramifications of their belief.
For example, if Muslims in general are at war with the United States, then why shouldn’t Americans be out killing Muslims here in the United States? After all, when a nation is at war, isn’t it permissible to kill the enemy? Isn’t that what war is all about?
The reason that proponents of this view don’t start killing Muslims here in the United States is very simple: Deep down, they know that the killers will be indicted by their very own government for murder. They will then be prosecuted, convicted, and sentenced to serve time in a federal penitentiary for murder.
Let’s carry the ramifications overseas.
If the United States is at war against Muslims, then why not start with ousting the Muslim regime in Iraq and installing a Christian or Jewish regime in its place? Yes, I said Iraq. Believe it or not, the U.S. invasion of that country succeeded in installing an Islamic regime, a regime which, by the way, has closely aligned itself with the radical Islamic regime in Iran.
A second-choice candidate for invasion, occupation, and regime change would be Kuwait, another country run by an Islamic regime. Since Saddam Hussein’s forces were easily able to conquer the country, it should be a piece of cake for U.S. forces.
A problem arises however. Once the United States effects regime change in Iraq and Kuwait, installing Christian or Jewish regimes, what about the millions of Muslims in those two countries? Sure, their governments would no longer be Islamic but what about the millions of people living there? Wouldn’t they still be the enemy to Christians and the West? Wouldn’t they still be bent on world conquest? What should be done with them? Perpetual incarceration in concentration camps? Mass executions of all Muslims?
And what about Saudi Arabia, Jordan, Egypt, and all the other countries in which people are predominantly Muslim. You know — the Islamic countries that are the recipients of billions of dollars in U.S. foreign aid. Does the U.S. government invade those countries too, effect regime change, and incarcerate or execute the millions of Muslims living there?
During the Cold War, people used to say the same thing about the communists that we’re now hearing about the Muslims. The communists were coming to get us, and some Americans were even looking under their beds for communists. In fact, 58,000 American men were sacrificed in Southeast Asia because U.S. officials claimed that Vietnam was the central front in the war on communism. With a military loss in Vietnam, the dominoes would start falling, they told us, with the final domino being the United States.
Yet, the U.S. did lose in Vietnam, and yet the dominoes didn’t fall. It turned out that those 58,000 American men died for nothing. Today, U.S. officials even travel to Vietnam as tourists. Americans are freely trading with the people who were supposedly going to invade the United States and take over the IRS and the public schools.
Ironically, throughout the Cold War there was nary a mention of the Islamic threat to the West, even though proponents of that view today claim that the Muslim threat stretches back many centuries. In fact, the irony of ironies is that during the Cold War the U.S. government even entered into partnerships with Muslims, including Osama bin Laden, Saddam Hussein, and various Islamic regimes in the Middle East. No one accused U.S. officials of treason for entering into agreements with the enemy.
It’s true that Muslims have fundamental differences with Christians and the West, and vice versa. But those types of differences ordinarily do not cause people to kill people who have different values. Most Muslims are no different from Americans in the sense that they simply wish to live their lives in peace, practice their faith, raise their families, and be left alone. They don’t like it when some foreign government tries to interfere with their way of life, just as Americans don’t like it when some foreign government does that to them.
What all too many Americans, unfortunately, will not permit themselves to see is that that is precisely what the U.S. government did in the Middle East, especially when the Soviet communist bugaboo evaporated in 1989. As a result of U.S. interventionism in the Middle East, especially the interventionism that resulted in large number of deaths (e.g., the sanctions and the no-fly zones), what began as differences in values rose to the level of anger and rage that induced some people to seek vengeance through violence.
Thus, rather than ceasing its policy of interventionism after 9/11, which is what the U.S. government should have done even while pursuing the perpetrators through criminal-justice means, it did the very worst thing possible — it continued and even expanded its policy of interventionism in the hope of killing those whose differences with America’s values had risen to the level of rage as a result of U.S. interventionism. Not surprisingly, that only fueled more anger and rage.
So, what should the U.S. government do now? It should do what it should have done after 9/11: Exit Afghanistan and Iraq and the entire Middle East. Bring all the troops home.
Would this quell the anger and rage against the United States? Not all of it but certainly much of it. As I said above, most people simply want to live their lives in peace.
After all, look at Vietnam, where the U.S. government killed more than a million people. Once U.S. forces exited the country, the Vietnamese left the United States alone.
While there is the ever-present risk that there will still be some people who will still want vengeance, their numbers will be relatively small. While they will constitute an ever-present threat of terrorism, that’s the price that must be paid for past interventions. What’s important to note is that continued interventionism can never solve that problem — it can only make it worse.
When governments go awry, it is up to the citizenry to straighten out their course. The problem is not Muslims or Islam. The problem is the U.S. government and, specifically, its foreign policy of interventionism. Bringing an end to that policy will restore a sense of peace and harmony not only to the American people but also the people of the world.
By Jacob G. Hornberger
One of the popular post-9/11 sentiments has been the one that holds that Muslims are bent on conquering the world. The notion is that Muslims hate Christianity and Western freedom and values and that such hatred is rooted in the Koran and stretches back centuries. Thus, the United States has been drawn, reluctantly, into a war against Muslims. That’s why U.S. forces are in Iraq and Afghanistan, the argument goes — to defend our freedoms by killing Muslims over there before they get over here and kill us.
I sometimes wonder whether the people who have this mindset have reflected on the ramifications of their belief.
For example, if Muslims in general are at war with the United States, then why shouldn’t Americans be out killing Muslims here in the United States? After all, when a nation is at war, isn’t it permissible to kill the enemy? Isn’t that what war is all about?
The reason that proponents of this view don’t start killing Muslims here in the United States is very simple: Deep down, they know that the killers will be indicted by their very own government for murder. They will then be prosecuted, convicted, and sentenced to serve time in a federal penitentiary for murder.
Let’s carry the ramifications overseas.
If the United States is at war against Muslims, then why not start with ousting the Muslim regime in Iraq and installing a Christian or Jewish regime in its place? Yes, I said Iraq. Believe it or not, the U.S. invasion of that country succeeded in installing an Islamic regime, a regime which, by the way, has closely aligned itself with the radical Islamic regime in Iran.
A second-choice candidate for invasion, occupation, and regime change would be Kuwait, another country run by an Islamic regime. Since Saddam Hussein’s forces were easily able to conquer the country, it should be a piece of cake for U.S. forces.
A problem arises however. Once the United States effects regime change in Iraq and Kuwait, installing Christian or Jewish regimes, what about the millions of Muslims in those two countries? Sure, their governments would no longer be Islamic but what about the millions of people living there? Wouldn’t they still be the enemy to Christians and the West? Wouldn’t they still be bent on world conquest? What should be done with them? Perpetual incarceration in concentration camps? Mass executions of all Muslims?
And what about Saudi Arabia, Jordan, Egypt, and all the other countries in which people are predominantly Muslim. You know — the Islamic countries that are the recipients of billions of dollars in U.S. foreign aid. Does the U.S. government invade those countries too, effect regime change, and incarcerate or execute the millions of Muslims living there?
During the Cold War, people used to say the same thing about the communists that we’re now hearing about the Muslims. The communists were coming to get us, and some Americans were even looking under their beds for communists. In fact, 58,000 American men were sacrificed in Southeast Asia because U.S. officials claimed that Vietnam was the central front in the war on communism. With a military loss in Vietnam, the dominoes would start falling, they told us, with the final domino being the United States.
Yet, the U.S. did lose in Vietnam, and yet the dominoes didn’t fall. It turned out that those 58,000 American men died for nothing. Today, U.S. officials even travel to Vietnam as tourists. Americans are freely trading with the people who were supposedly going to invade the United States and take over the IRS and the public schools.
Ironically, throughout the Cold War there was nary a mention of the Islamic threat to the West, even though proponents of that view today claim that the Muslim threat stretches back many centuries. In fact, the irony of ironies is that during the Cold War the U.S. government even entered into partnerships with Muslims, including Osama bin Laden, Saddam Hussein, and various Islamic regimes in the Middle East. No one accused U.S. officials of treason for entering into agreements with the enemy.
It’s true that Muslims have fundamental differences with Christians and the West, and vice versa. But those types of differences ordinarily do not cause people to kill people who have different values. Most Muslims are no different from Americans in the sense that they simply wish to live their lives in peace, practice their faith, raise their families, and be left alone. They don’t like it when some foreign government tries to interfere with their way of life, just as Americans don’t like it when some foreign government does that to them.
What all too many Americans, unfortunately, will not permit themselves to see is that that is precisely what the U.S. government did in the Middle East, especially when the Soviet communist bugaboo evaporated in 1989. As a result of U.S. interventionism in the Middle East, especially the interventionism that resulted in large number of deaths (e.g., the sanctions and the no-fly zones), what began as differences in values rose to the level of anger and rage that induced some people to seek vengeance through violence.
Thus, rather than ceasing its policy of interventionism after 9/11, which is what the U.S. government should have done even while pursuing the perpetrators through criminal-justice means, it did the very worst thing possible — it continued and even expanded its policy of interventionism in the hope of killing those whose differences with America’s values had risen to the level of rage as a result of U.S. interventionism. Not surprisingly, that only fueled more anger and rage.
So, what should the U.S. government do now? It should do what it should have done after 9/11: Exit Afghanistan and Iraq and the entire Middle East. Bring all the troops home.
Would this quell the anger and rage against the United States? Not all of it but certainly much of it. As I said above, most people simply want to live their lives in peace.
After all, look at Vietnam, where the U.S. government killed more than a million people. Once U.S. forces exited the country, the Vietnamese left the United States alone.
While there is the ever-present risk that there will still be some people who will still want vengeance, their numbers will be relatively small. While they will constitute an ever-present threat of terrorism, that’s the price that must be paid for past interventions. What’s important to note is that continued interventionism can never solve that problem — it can only make it worse.
When governments go awry, it is up to the citizenry to straighten out their course. The problem is not Muslims or Islam. The problem is the U.S. government and, specifically, its foreign policy of interventionism. Bringing an end to that policy will restore a sense of peace and harmony not only to the American people but also the people of the world.
5 Reasons Why Wall Street's Bailout Won't Work
Go to Original
By Danny Schechter
By Danny Schechter
Most Americans know the phrase, “if it ain’t broke don’t fix it.” In the good times, when the economy boomed and Wall Street prospered, it looked like nothing was broke. The free market, we were told, was working like magic insuring prosperity and progress.
But then it happened, out of sight and out of mind, an upward trajectory turned in the other direction. In what was for many an unbelievable chain of events, markets started melting down, banks began writing down portfolios clogged with asset-backed securities that had no assets behind them. Confidence shattered. Suddenly, believers in unregulated transactions realized something was very, very wrong.
Alan Greenspan was “shocked” and said he was wrong to support deregulation of financial markets. As headlines conjured up breadlines and recession, with “something worse” threatening, the government was pressed to act.
Over a year later, after eight interest rate cuts, with one more promised, and the injection of trillions into credit markets and banks worldwide, little has changed. Markets are volatile and trending down while banks are still not lending despite frequent projections of massive unemployment and stagflation.
At the same time, we live in a country that believes that whenever there are problems, there must be solutions. And in the case of the financial crisis, there is no shortage of proposals especially because the whole system—if not capitalism itself—seems at risk. (Even the NY Times ran an editorial on “Rescuing Capitalism.”) This is not a situation that inspires confidence in token reforms and minor adjustments. There seems to be a consensus that this crisis is systemic and structural even as the candidates reduce it all to tax policy.
That hasn’t stopped the government from dipping into its tool bag and throwing everything it has at the problem---bailouts on an unprecedented scale, including, now, of insurance companies and auto lenders There have been pro-business rule changes even partial nationalizations of banks, mortgage companies, and insurance combines.
Together, the Treasury Department and the Federal Reserve Bank seem to be fighting on every front. They appear to be giving away money. Is it working?
“Scarcely a day goes by with out some dramatic new initiative,“ writes The New Yorker’s financial columnist James Suriwieki, “even as market chaos makes each new idea soon seem like ancient history.”
Why is that? Surely the people in command are smart, savvy and know the system well. What are they missing? They now know its broke (and many of them are broke too) but they can’t seem to fix it.
Here are five views on what they are getting wrong.
l. THE SYSTEM NEEDS TO COLLAPSE
That’s the view of a perennial bear investor Marc Fabor who “thinks the market was primed for a technical rally” but is not keen on the long-term prospects for the US economy:
“The governments in this world have no other option but to print money. That will lead down the road to inflation,’’ Faber said. “You don’t need to be an economist graduated from Harvard to know we’re already in a recession. They will just put white paint on a crumbling building....
“To rebuild economic health in the United States, you need a serious recession that will last several years,’’ he said. “The patient that got drunk on credit growth needs to go into rehabilitation. To give him more alcohol, the way the Fed and the Treasury propose to do, is the wrong medicine.’’
2. CONSUMERS ARE NOT SPENDING
Bloomberg reports:
The big concern is that households, spooked by the turmoil in financial markets, will cut back rapidly and sharply, plunging companies into bankruptcy and deepening a recession that many economists say has already begun.
“If we did have a quick cut in spending, it could turn a pretty nasty recession into possibly the worst downturn we’ve seen in the postwar period,’’ says Michael Feroli, a former Federal Reserve official now at JPMorgan Chase & Co.
3. MORAL HAZARD: THEY ARE BAILING OUT THE WRONG PEOPLE
There is something fundamentally wrong in rewarding the people who are responsible for the problem. Worries William Buitner, a financial historian at the London School of Economics, that this will lead to more collapses in the future: “by boosting the incentives for future reckless lending to elephantesquely large financial enterprises.
Unless not only the existing shareholders of the banks benefiting from these capital injections but also the holders of the banks’ unsecured debt (junior and senior) and all other creditors of the bank (with the possible exception of retail depositors up to some appropriate limit) are made to pay a painful penalty for investing in excessively risky if not outright dodgy ventures, we are laying the foundations of the next systemic crisis, even as we are struggling to escape from the current one.”
The bailout was sold deceptively. A New York Times investigation found it was Intended to foster bank consolidation, not loans. Journalist Sam Smith wrote:
Never in the history of the United States has so much public money been spent with so little accounting of where it is right now and where it’s going next. Never has so much public money been spent by order of officials who helped to create the crisis the money is supposed to resolve. Never has so much public money been spent by officials for the benefit of so many former colleagues. Never has so much public money been spent with so little explanation by the media. And never has so much public money been spent with so little debate over possible alternatives.
4, FINANCIAL SCAMMERS AND CRIMINALS ARE GOING UNPUNISHED
The FBI announced that it lacks the staff to fully investigate the pervasive crimes on Wall Street.
5. GOOD PEOPLE ARE LEAVING IN DISGUST
Some of the best and the brightest are giving up, rejecting businesses based on flimflams and deceptive marketing. Two years ago, a very successful investor, Andrew Ladhe, started returning money to his investors. “Our entire banking system is a complete disaster,” he wrote. “In my opinion, nearly every major bank would be insolvent if they marked their assets to market.”
In October 2008 he closed his firm all together explaining:
Recently, on the front page of Section C of the Wall Street Journal, a hedge fund manager who was also closing up shop (a $300 million fund), was quoted as saying, “What I have learned about the hedge fund business is that I hate it.” I could not agree more with that statement. I was in this game for the money. The low hanging fruit, i.e. idiots whose parents paid for prep school, Yale, and then the Harvard MBA, was there for the taking. These people who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies such as AIG, Bear Stearns and Lehman Brothers and all levels of our government. All of this behavior supporting the Aristocracy only ended up making it easier for me to find people stupid enough to take the other side of my trades. God bless America.
These are just five reasons why “the quick fixers” are unlikely to succeed. Notes Harpers, we a need more than tinkering. They call for a fundamental reconstruction at a time when we are also “menaced by dwindling energy supplies and accelerating climate change.”
Also, the Captain Ahabs in charge should admit defeat and step down as was suggested by this comment on a financial website:
Perhaps Bernanke and Greenspan should see if there is an opening for the captain of the Exxon Valdees, job requirements: asleep at the switch.
Still to be answered: can the system be saved from itself?
The financial woes signal the death of the dollar?
Go to Original
By Rev. Richard Skaff
In this age of globalization, the United Stated has been slowly losing its industrial power. In the last thirty years political decisions were made to outsource industrial jobs and close down manufacturing. Shipping overseas our industrial jobs and seeking instead cheap labor or neo-slavery to maximize profits, has left us with nothing to show for except for fiat money designed and controlled by the private and the global Federal Reserve Bank.
Consumerism of cheap goods that made us look wealthy and feel prosperous superseded our industrial power. Meanwhile, our leaders mortgaged the future of our children, fleeced America, as they rendered us into a global empire made of fiat papers which could collapse anytime like a house of cards when the money masters decide to end the game. We were also turned into an illusive powerhouse of debt financed by foreign countries that have to reinvest that money back in New York and London. The petro-dollar as termed by the war criminal Henry Kissinger became the world’s reserve currency. We dollarized the world through systematic assassination of currencies and economies, therefore forcing interdependency among the reformed countries. Oil replaced gold as the back up for the petro-dollars, and as a result, made the global economy totally dependent on the price of oil which in turn affects the strength of the dollar.
Today, the US economic woes are reverberating all over Europe and the world as a result of our failed monetary and fiscal policies, as well as our exportation of the only products we have left to sell, the scandalous subprime mortgages, the housing bubble, and the high risk packaged loans dressed with an attractive name as SIVs (Structured Investment vehicles) to enhance their marketability.
The New York Times reported on October 8, that another wave of relentless selling washed over global markets, with stocks plunging in Europe an Asia. The Tokyo market had its worst decline since the 1987 crash.
The British government’s announcement of a plan to bail out the country’s foundering banks with about 88 billion of new capital did little to resolve market confidence, with banks again leading indexes lower Wednesday after the Dow Jones industrial average fell 54 percent in New York Tuesday. [1].
“It was a horrible session in New York and a horrible session in Tokyo,” Jim Reid, head of fundamental credit strategy at Deutsche Bank London said. He added that “The momentum is negative, and I think there are probably more bank failures and forced consolidation to come in the financial sector.” “Whatever day of the week you wake up, it’s another country having problems.
Sure enough, Iceland Prime Minister Geir Haarde warned his nation of bankruptcy. [2]. He addressed his nation to introduce emergency legislation, as Iceland is facing its worst economic crisis in modern times
It is ironic that the fear mongering and the propaganda perpetuating corporate media has recently shifted focus from the military Industrial Complex agenda of war waging and terrorism to the Financial Industrial Complex of economic Armageddon.
Meanwhile, they incessantly covered the 700 billions dollar bailout of Wall Street and their co-conspirators in foreign countries, while they purposefully ignored the passing of the $612 billion dollars defense budget that was quietly and stealthily approved by the majority of our pseudo-patriotic and treasonous congressmen.
We seem to be moving from one crisis to another, like the war and the terrorism crisis, to the food and energy crisis, and last is the financial crisis. What crisis is brewing next that will keep the population engulfed in fear and confusion?
We have to ask ourselves, why was this financial crisis created? Who caused it? And who will benefit from it?
Analysis and predictions:
Historically, economic crises are designed to redistribute the wealth and consolidate it in fewer hands. Therefore, the rich becomes richer and the money masters expand their grasp on the ownership of the world.
It does not take an economic genius to realize that an economy based on debt cannot survive in the long term. Despite people’s frantic consumerism, and their magical expectation that money grows on trees, the reality is that debts only lead to bankruptcies, and financial Armageddon.
However the elite and the money masters know this fact too well, therefore, just like in the 1930s’ depression, the rich always gets richer because they can afford to gobble up all of the businesses that go under for a fraction of the actual cost, hold on to it for a while, then, flood the market with it, which will lead to increase in prices and tremendous profits for them.
This phenomenon has occurred many times in recent history.
The Bush administration has single-handedly increased our national debt by over five trillion dollars, more than all past administrations combined together. Bush has apparently achieved his objective by accruing more debt than any other president in the history of this nation.
Was it done on purpose? Creating pseudo-military and low intensity conflicts lead to tremendous borrowing and justified printing of money in the name of national security, which would hyperinflate the currency and eventually destroy it.
Was the extensive borrowing with the lavish and uncontrolled spending designed specifically and deliberately to weaken the dollar and the US to the point of collapse, which will lead to the justification of change in currency?
Fear mongering and morbid forecasts are circulating everywhere predicting doom, knowing well that the stock market operates on sentiment, rumors, and manipulation not on objective measurable means.
In reality, Armageddon has always been contrived by the elite and seems to affect only the middle class. The poor usually remains untouched, and the rich becomes richer, so the middle class is always squeezed to a point of no return. Once the middle class is slowly and fully assassinated in the US, then, the globalization process becomes easier to implement and the Security and Prosperity Partnership (North America Union) will rush toward us like a knight in shining armor riding on a beautiful white horse to rescue us from our financial disasters that were deliberately created by our treasonous leaders.
Hopefully, this resurrection will occur in the spring of 2010 when the grape vines rejuvenate and flourish, and the Christ rises again to save us from our sins, and the Christian fundamentalists will all screech with reverence, vanity, and unity, “praise the lord,” “praise the Lord” it’s a miracle.
Meanwhile, the Luciferian network embodied in the neocons, the international bankers, and the global corporate CEOs/politicians will solidify further their power and their wealth, and will create more means to control the populace. The Home Land Security will become the Orwellian North American Union Ministry of Love where lies and hatred is imbued and propagated, and the Ministry of defense will become the Orwellian Ministry of peace where covert wars and assassinations will continue to be waged as a mean to subjugate and impoverish every corner of the world.
Rev. Richard Skaff - Journalist and author of “The Human Manifesto”
References:
1. The New York Times, Wednesday October 08, 2008. Global Market plunge
2. Times online, October 6 2008. Icelandic Prime Minister Geir Haarde warns nation of bankruptcy 3. the Independent, October 8, 2008. Iceland: dancing on the brink of bankruptcy.
By Rev. Richard Skaff
In this age of globalization, the United Stated has been slowly losing its industrial power. In the last thirty years political decisions were made to outsource industrial jobs and close down manufacturing. Shipping overseas our industrial jobs and seeking instead cheap labor or neo-slavery to maximize profits, has left us with nothing to show for except for fiat money designed and controlled by the private and the global Federal Reserve Bank.
Consumerism of cheap goods that made us look wealthy and feel prosperous superseded our industrial power. Meanwhile, our leaders mortgaged the future of our children, fleeced America, as they rendered us into a global empire made of fiat papers which could collapse anytime like a house of cards when the money masters decide to end the game. We were also turned into an illusive powerhouse of debt financed by foreign countries that have to reinvest that money back in New York and London. The petro-dollar as termed by the war criminal Henry Kissinger became the world’s reserve currency. We dollarized the world through systematic assassination of currencies and economies, therefore forcing interdependency among the reformed countries. Oil replaced gold as the back up for the petro-dollars, and as a result, made the global economy totally dependent on the price of oil which in turn affects the strength of the dollar.
Today, the US economic woes are reverberating all over Europe and the world as a result of our failed monetary and fiscal policies, as well as our exportation of the only products we have left to sell, the scandalous subprime mortgages, the housing bubble, and the high risk packaged loans dressed with an attractive name as SIVs (Structured Investment vehicles) to enhance their marketability.
The New York Times reported on October 8, that another wave of relentless selling washed over global markets, with stocks plunging in Europe an Asia. The Tokyo market had its worst decline since the 1987 crash.
The British government’s announcement of a plan to bail out the country’s foundering banks with about 88 billion of new capital did little to resolve market confidence, with banks again leading indexes lower Wednesday after the Dow Jones industrial average fell 54 percent in New York Tuesday. [1].
“It was a horrible session in New York and a horrible session in Tokyo,” Jim Reid, head of fundamental credit strategy at Deutsche Bank London said. He added that “The momentum is negative, and I think there are probably more bank failures and forced consolidation to come in the financial sector.” “Whatever day of the week you wake up, it’s another country having problems.
Sure enough, Iceland Prime Minister Geir Haarde warned his nation of bankruptcy. [2]. He addressed his nation to introduce emergency legislation, as Iceland is facing its worst economic crisis in modern times
It is ironic that the fear mongering and the propaganda perpetuating corporate media has recently shifted focus from the military Industrial Complex agenda of war waging and terrorism to the Financial Industrial Complex of economic Armageddon.
Meanwhile, they incessantly covered the 700 billions dollar bailout of Wall Street and their co-conspirators in foreign countries, while they purposefully ignored the passing of the $612 billion dollars defense budget that was quietly and stealthily approved by the majority of our pseudo-patriotic and treasonous congressmen.
We seem to be moving from one crisis to another, like the war and the terrorism crisis, to the food and energy crisis, and last is the financial crisis. What crisis is brewing next that will keep the population engulfed in fear and confusion?
We have to ask ourselves, why was this financial crisis created? Who caused it? And who will benefit from it?
Analysis and predictions:
Historically, economic crises are designed to redistribute the wealth and consolidate it in fewer hands. Therefore, the rich becomes richer and the money masters expand their grasp on the ownership of the world.
It does not take an economic genius to realize that an economy based on debt cannot survive in the long term. Despite people’s frantic consumerism, and their magical expectation that money grows on trees, the reality is that debts only lead to bankruptcies, and financial Armageddon.
However the elite and the money masters know this fact too well, therefore, just like in the 1930s’ depression, the rich always gets richer because they can afford to gobble up all of the businesses that go under for a fraction of the actual cost, hold on to it for a while, then, flood the market with it, which will lead to increase in prices and tremendous profits for them.
This phenomenon has occurred many times in recent history.
The Bush administration has single-handedly increased our national debt by over five trillion dollars, more than all past administrations combined together. Bush has apparently achieved his objective by accruing more debt than any other president in the history of this nation.
Was it done on purpose? Creating pseudo-military and low intensity conflicts lead to tremendous borrowing and justified printing of money in the name of national security, which would hyperinflate the currency and eventually destroy it.
Was the extensive borrowing with the lavish and uncontrolled spending designed specifically and deliberately to weaken the dollar and the US to the point of collapse, which will lead to the justification of change in currency?
Fear mongering and morbid forecasts are circulating everywhere predicting doom, knowing well that the stock market operates on sentiment, rumors, and manipulation not on objective measurable means.
In reality, Armageddon has always been contrived by the elite and seems to affect only the middle class. The poor usually remains untouched, and the rich becomes richer, so the middle class is always squeezed to a point of no return. Once the middle class is slowly and fully assassinated in the US, then, the globalization process becomes easier to implement and the Security and Prosperity Partnership (North America Union) will rush toward us like a knight in shining armor riding on a beautiful white horse to rescue us from our financial disasters that were deliberately created by our treasonous leaders.
Hopefully, this resurrection will occur in the spring of 2010 when the grape vines rejuvenate and flourish, and the Christ rises again to save us from our sins, and the Christian fundamentalists will all screech with reverence, vanity, and unity, “praise the lord,” “praise the Lord” it’s a miracle.
Meanwhile, the Luciferian network embodied in the neocons, the international bankers, and the global corporate CEOs/politicians will solidify further their power and their wealth, and will create more means to control the populace. The Home Land Security will become the Orwellian North American Union Ministry of Love where lies and hatred is imbued and propagated, and the Ministry of defense will become the Orwellian Ministry of peace where covert wars and assassinations will continue to be waged as a mean to subjugate and impoverish every corner of the world.
Rev. Richard Skaff - Journalist and author of “The Human Manifesto”
References:
1. The New York Times, Wednesday October 08, 2008. Global Market plunge
2. Times online, October 6 2008. Icelandic Prime Minister Geir Haarde warns nation of bankruptcy 3. the Independent, October 8, 2008. Iceland: dancing on the brink of bankruptcy.
What Will YOU Do About The Worst Capitalist Crisis Since The 1930s?
Go to Original
By Larry Holmes
Uniting & fighting back is no longer a choice; it’s a matter of survival
Most people have heard that the economic nightmare—the “greed and profits before society” that the capitalist system is plunging us into—is the worst crisis since the so-called Great Depression of the 1930s.
What you won’t get from the capitalist mass media is how the crisis of the 1930s transformed tens of millions of frightened workers and desperately poor people of all races and nationalities into a fighting force organized on the basis of class solidarity in an epic struggle against the capitalists and their government. By the end of the 1930s, it was not the super-rich, but the organized working class that seemed all powerful and unbeatable.
Working and poor people, devastated by the depression, entered the 1930s destitute, broken and hopeless. Yet by the time the decade was over, the working class had won great battles, first by organizing itself into Unemployment Councils and tenants unions and later into giant labor unions.
Social Security, Medicaid, millions of jobs created by giant public works programs and the right to unionize were among the major achievements of the struggles of the 1930s.
With the help of communist activists dedicated to fighting on behalf of the working class, people organized to stop landlords and banks from evicting families from their apartments or homes.
Workers in the auto, steel and many other industries discovered new tactics in their fight to win the right to belong to a labor union. In addition to going on strike, sometimes the workers decided to stay in the plants and factories where they were striking. They took them over until they won their demands.
A leaflet urging people to attend what became one of the most famous mass protests against unemployment in New York City’s Union Square in March 1930 simply read, “Fight or Starve.”
That was one of the biggest lessons that the working class learned during the 1930s— either we push aside all that divides us, and anything that someone can use to divide us like class, and fight like hell or we will not survive.
This lesson is as relevant today as it was 75 years ago. Whether we unite and fight back will be a matter of survival for most of us this time as well. Let there be no doubt: Unless you’re rich, chances are either you will lose your job—some of you already have too little pay—and find it almost impossible to find a job or you will lose a place to live. Many will lose their student loans. Others will lose their pensions and find themselves burdened with debt and no health insurance. Many more of us will be homeless and hungry.
The cultural ideas and norms of recent times—ideas and norms invented and perpetuated by the capitalist system, the billionaires that it serves, their media, their schools, their hierarchy where most of us work and their political system—have not prepared us to act in our own interests in concert with others.
The ideas reinforced every day are that if you fail, it’s your fault alone. The rich are rich because they’re smart. Human nature is innately bad so don’t trust those like you; you’ve got to compete with them. Along with these lies, there is the big one that “things will get better sooner or later” because “this is the greatest country and capitalism is not only the best system, it’s the only one.”
The basic conspiracy afoot here is designed to keep us divided, confined to our own personal worlds, essentially left alone to deal with the crisis and the capitalist class that’s at war with us 24/7.
With the incredible stresses of today, people certainly deserve the right to put their headsets on and zone out to the great music they’ve downloaded on their Ipods. Or veg-out on the several thousand cable stations on their TV (if their cable hasn’t been turned off due to lack of payment). Or spend hours online, which is both social yet isolating at the same time. One can, of course, abuse substances of choice, but ultimately that does more harm than help.
Most people probably think, with good reason, that capitalism’s most effective social control mechanisms are its racist police, FBI, Immigration and Customs Enforcement, courts, jails and the Pentagon, all now under the umbrella of “homeland security.”
Obviously government repression is a problem. However, in and of itself, it’s not enough to control the masses or stop us from rebelling.
Equally, if not more effectively, are the ways in which the system works very hard to program us not to unite and fight.
What the system does is a lot like what’s depicted in the movie “The Matrix.” In the real capitalist matrix our comatose bodies are not warehoused somewhere, while our drugged minds stumble around in a computer-generated dream world. Still, the function of the real capitalist matrix is more frightening and diabolical because it’s not a movie.
The capitalist system works hard to keep our political consciousness paralyzed and in a coma in order to make us passive, regimented, disconnected from each other and thereby easier to exploit, which is what the parasitic capitalist system is really all about.
In order to unite and fight for our right to a job and a place to live, to healthcare and education, to all that we need and deserve, we’re going to have to break out of the capitalist matrix. Some will break out before others, but most of us will make it out.
In the movie, Neo is given the choice between the blue pill which equals blissful ignorance, and the red pill which is the path to the truth and to revolutionary action. With every passing day, more and more workers will take the red pill. Which one will you take?
Articles copyright 1995-2008 Workers World. Verbatim copying and distribution of this entire article is permitted in any medium without royalty provided this notice is preserved.
By Larry Holmes
Uniting & fighting back is no longer a choice; it’s a matter of survival
Most people have heard that the economic nightmare—the “greed and profits before society” that the capitalist system is plunging us into—is the worst crisis since the so-called Great Depression of the 1930s.
What you won’t get from the capitalist mass media is how the crisis of the 1930s transformed tens of millions of frightened workers and desperately poor people of all races and nationalities into a fighting force organized on the basis of class solidarity in an epic struggle against the capitalists and their government. By the end of the 1930s, it was not the super-rich, but the organized working class that seemed all powerful and unbeatable.
Working and poor people, devastated by the depression, entered the 1930s destitute, broken and hopeless. Yet by the time the decade was over, the working class had won great battles, first by organizing itself into Unemployment Councils and tenants unions and later into giant labor unions.
Social Security, Medicaid, millions of jobs created by giant public works programs and the right to unionize were among the major achievements of the struggles of the 1930s.
With the help of communist activists dedicated to fighting on behalf of the working class, people organized to stop landlords and banks from evicting families from their apartments or homes.
Workers in the auto, steel and many other industries discovered new tactics in their fight to win the right to belong to a labor union. In addition to going on strike, sometimes the workers decided to stay in the plants and factories where they were striking. They took them over until they won their demands.
A leaflet urging people to attend what became one of the most famous mass protests against unemployment in New York City’s Union Square in March 1930 simply read, “Fight or Starve.”
That was one of the biggest lessons that the working class learned during the 1930s— either we push aside all that divides us, and anything that someone can use to divide us like class, and fight like hell or we will not survive.
This lesson is as relevant today as it was 75 years ago. Whether we unite and fight back will be a matter of survival for most of us this time as well. Let there be no doubt: Unless you’re rich, chances are either you will lose your job—some of you already have too little pay—and find it almost impossible to find a job or you will lose a place to live. Many will lose their student loans. Others will lose their pensions and find themselves burdened with debt and no health insurance. Many more of us will be homeless and hungry.
The cultural ideas and norms of recent times—ideas and norms invented and perpetuated by the capitalist system, the billionaires that it serves, their media, their schools, their hierarchy where most of us work and their political system—have not prepared us to act in our own interests in concert with others.
The ideas reinforced every day are that if you fail, it’s your fault alone. The rich are rich because they’re smart. Human nature is innately bad so don’t trust those like you; you’ve got to compete with them. Along with these lies, there is the big one that “things will get better sooner or later” because “this is the greatest country and capitalism is not only the best system, it’s the only one.”
The basic conspiracy afoot here is designed to keep us divided, confined to our own personal worlds, essentially left alone to deal with the crisis and the capitalist class that’s at war with us 24/7.
With the incredible stresses of today, people certainly deserve the right to put their headsets on and zone out to the great music they’ve downloaded on their Ipods. Or veg-out on the several thousand cable stations on their TV (if their cable hasn’t been turned off due to lack of payment). Or spend hours online, which is both social yet isolating at the same time. One can, of course, abuse substances of choice, but ultimately that does more harm than help.
Most people probably think, with good reason, that capitalism’s most effective social control mechanisms are its racist police, FBI, Immigration and Customs Enforcement, courts, jails and the Pentagon, all now under the umbrella of “homeland security.”
Obviously government repression is a problem. However, in and of itself, it’s not enough to control the masses or stop us from rebelling.
Equally, if not more effectively, are the ways in which the system works very hard to program us not to unite and fight.
What the system does is a lot like what’s depicted in the movie “The Matrix.” In the real capitalist matrix our comatose bodies are not warehoused somewhere, while our drugged minds stumble around in a computer-generated dream world. Still, the function of the real capitalist matrix is more frightening and diabolical because it’s not a movie.
The capitalist system works hard to keep our political consciousness paralyzed and in a coma in order to make us passive, regimented, disconnected from each other and thereby easier to exploit, which is what the parasitic capitalist system is really all about.
In order to unite and fight for our right to a job and a place to live, to healthcare and education, to all that we need and deserve, we’re going to have to break out of the capitalist matrix. Some will break out before others, but most of us will make it out.
In the movie, Neo is given the choice between the blue pill which equals blissful ignorance, and the red pill which is the path to the truth and to revolutionary action. With every passing day, more and more workers will take the red pill. Which one will you take?
Articles copyright 1995-2008 Workers World. Verbatim copying and distribution of this entire article is permitted in any medium without royalty provided this notice is preserved.
American Hegemony Bites The Dust
Go to Original
By Paul Craig Roberts
The Defanging of America: Reality-Based Community Overthrows History’s Actors
"We're an empire now, and when we act, we create our own reality. And while you're studying that reality -- judiciously, as you will -- we'll act again, creating other new realities, which you can study too, and that's how things will sort out. We're history's actors . . . and you, all of you, will be left to just study what we do." Bush White House aide explaining the New Reality
The New American Century lasted a decade. Financial crisis and defeated objectives in Iraq, Afghanistan, and Georgia brought the neoconservative project for American world hegemony crashing to a close in the autumn of 2008.
The American neoconservatives are the heirs of Leon Trotsky. Their dream of American “Full Spectrum Dominance”--US military and economic superiority over any possible combination of states--is matched in ambition only by the early 20th century Trotskyite dream of world Communist revolution.
The neocons used September 11, 2001, as a “new Pearl Harbor” to give power precedence over law domestically and internationally. The executive branch no longer had to obey federal statutes, such as the Foreign Intelligence Surveillance Act or honor international treaties, such as the Geneva Conventions. An asserted “terrorist threat” to national security became the cloak which hid US imperial interests as the Bush Regime set about dismantling US civil liberties and the existing order of international law constructed by previous governments during the post-war era.
Perhaps the neoconservative project for world hegemony would have lasted a bit longer had the neocons possessed intellectual competence.
On the war front, the incompetent neocons predicted that the Iraq war would be a six-week cakewalk, whose $70 billion cost would be paid out of Iraqi oil revenues. President Bush fired White House economist Larry Lindsey for estimating that the war would cost $200 billion. The current estimate by experts is that the Iraq war has cost American taxpayers between two and three trillion dollars. And the six-week war is now the six-year war.
On the economic front, the incompetent neocons overlooked the fact that a country that relocates its industry and best jobs abroad in order to maximize short-run profits becomes progressively economically weaker. Propagandistic talk about a “New Economy” built around financial dominance covered up the fact that the US was the world’s greatest debtor country, dependent on foreigners to finance the daily operation of its government, the home mortgages of its citizens, and its military operations abroad.
In Iraq the neocons gave up their hegemonic military pretensions when they put 80,000 Sunni insurgents on the US Army’s payroll in order to scale down the fighting and reduce US casualties.
In Afghanistan the neocons gave up more military pretensions when they had to rely on NATO troops to fight the Taliban.
US military pretensions came to an end in Georgia when the Bush Regime sent Georgian troops to ethnically cleanse South Ossetia of Russian residents in order to end the secessionist movement in the province, thereby clearing the path for Georgia’s NATO membership. It took Russian soldiers only a few hours to destroy the US and Israeli trained and equipped Georgian Army.
The ongoing financial crisis has put an end to the pretensions of American financial hegemony and free-market illusions that deregulation and offshoring had brought prosperity to America.
In a long article, “The End of Arrogance,” on September 30, the German news magazine Der Spiegel observed:
This is no longer the muscular and arrogant United States the world knows, the superpower that sets the rules for everyone else and that considers its way of thinking and doing business to be the only road to success.
Also on display is the end of arrogance. The Americans are now paying the price for their pride.
Gone are the days when the US could go into debt with abandon, without considering who would end up footing the bill. And gone are the days when it could impose its economic rules of engagement on the rest of the world, rules that emphasized profit above all else -- without ever considering that such returns cannot be achieved by doing business in a respectable way.
A new chapter in economic history has begun, one in which the United States will no
longer play its former dominant role. A process of redistributing money and power around the world -- away from America and toward the resource-rich countries and rising industrialized nations in Asia -- has been underway for years. The financial crisis will only accelerate the process.
Looking at his defeated adversary, George W. Bush, brought down by military and economic failure, Iranian President Ahmadinejad observed: “The American empire in the world is reaching the end of its road, and its next rulers must limit their interference to their own borders.”
Truer words were never spoken.
By Paul Craig Roberts
The Defanging of America: Reality-Based Community Overthrows History’s Actors
"We're an empire now, and when we act, we create our own reality. And while you're studying that reality -- judiciously, as you will -- we'll act again, creating other new realities, which you can study too, and that's how things will sort out. We're history's actors . . . and you, all of you, will be left to just study what we do." Bush White House aide explaining the New Reality
The New American Century lasted a decade. Financial crisis and defeated objectives in Iraq, Afghanistan, and Georgia brought the neoconservative project for American world hegemony crashing to a close in the autumn of 2008.
The American neoconservatives are the heirs of Leon Trotsky. Their dream of American “Full Spectrum Dominance”--US military and economic superiority over any possible combination of states--is matched in ambition only by the early 20th century Trotskyite dream of world Communist revolution.
The neocons used September 11, 2001, as a “new Pearl Harbor” to give power precedence over law domestically and internationally. The executive branch no longer had to obey federal statutes, such as the Foreign Intelligence Surveillance Act or honor international treaties, such as the Geneva Conventions. An asserted “terrorist threat” to national security became the cloak which hid US imperial interests as the Bush Regime set about dismantling US civil liberties and the existing order of international law constructed by previous governments during the post-war era.
Perhaps the neoconservative project for world hegemony would have lasted a bit longer had the neocons possessed intellectual competence.
On the war front, the incompetent neocons predicted that the Iraq war would be a six-week cakewalk, whose $70 billion cost would be paid out of Iraqi oil revenues. President Bush fired White House economist Larry Lindsey for estimating that the war would cost $200 billion. The current estimate by experts is that the Iraq war has cost American taxpayers between two and three trillion dollars. And the six-week war is now the six-year war.
On the economic front, the incompetent neocons overlooked the fact that a country that relocates its industry and best jobs abroad in order to maximize short-run profits becomes progressively economically weaker. Propagandistic talk about a “New Economy” built around financial dominance covered up the fact that the US was the world’s greatest debtor country, dependent on foreigners to finance the daily operation of its government, the home mortgages of its citizens, and its military operations abroad.
In Iraq the neocons gave up their hegemonic military pretensions when they put 80,000 Sunni insurgents on the US Army’s payroll in order to scale down the fighting and reduce US casualties.
In Afghanistan the neocons gave up more military pretensions when they had to rely on NATO troops to fight the Taliban.
US military pretensions came to an end in Georgia when the Bush Regime sent Georgian troops to ethnically cleanse South Ossetia of Russian residents in order to end the secessionist movement in the province, thereby clearing the path for Georgia’s NATO membership. It took Russian soldiers only a few hours to destroy the US and Israeli trained and equipped Georgian Army.
The ongoing financial crisis has put an end to the pretensions of American financial hegemony and free-market illusions that deregulation and offshoring had brought prosperity to America.
In a long article, “The End of Arrogance,” on September 30, the German news magazine Der Spiegel observed:
This is no longer the muscular and arrogant United States the world knows, the superpower that sets the rules for everyone else and that considers its way of thinking and doing business to be the only road to success.
Also on display is the end of arrogance. The Americans are now paying the price for their pride.
Gone are the days when the US could go into debt with abandon, without considering who would end up footing the bill. And gone are the days when it could impose its economic rules of engagement on the rest of the world, rules that emphasized profit above all else -- without ever considering that such returns cannot be achieved by doing business in a respectable way.
A new chapter in economic history has begun, one in which the United States will no
longer play its former dominant role. A process of redistributing money and power around the world -- away from America and toward the resource-rich countries and rising industrialized nations in Asia -- has been underway for years. The financial crisis will only accelerate the process.
Looking at his defeated adversary, George W. Bush, brought down by military and economic failure, Iranian President Ahmadinejad observed: “The American empire in the world is reaching the end of its road, and its next rulers must limit their interference to their own borders.”
Truer words were never spoken.
The Diplomacy Of Lying
Go to Original
By John Pilger
In 1992, Mark Higson, the Foreign Office official responsible for Iraq, appeared before the Scott inquiry into the scandal of arms sold illegally to Saddam Hussein. He described a "culture of lying" at the heart of British foreign policymaking. I asked him how frequently ministers and officials lied to parliament.
"It's systemic," he said. "The draft letters I wrote for various ministers were saying that nothing had changed, the embargo on the sale of arms to Iraq was the same."
"Was that true?" I asked.
"No, it wasn't true."
"And your superiors knew it wasn't true?"
"Yes."
"So how much truth did the public get?"
"The public got as much truth as we could squeeze out, given that we told downright lies."
From British involvement with the genocidal Khmer Rouge in Cambodia, to the supply of warplanes to the Indonesian dictator Suharto, knowing he was bombing civilians in East Timor, to the denial of vaccines and other humanitarian aid to the children of Iraq, my experience with the Foreign Office is that Higson was right and remains right.
As I write this, the dispossessed people of the Chagos Islands in the Indian Ocean await the decision of the Law Lords, hoping for a repetition of four previous judgments that their brutal expulsion to make way for a US military base was "outrageous", "illegal" and "repugnant". That they must endure yet another appeal is thanks to the Foreign Office – whose legal adviser in 1968, one Anthony Ivall Aust (pronounced "oarst" and since knighted), wrote a secret document headed "Maintaining the fiction". This advised the then Labour government to "argue" the "fiction" that the Chagossians were "only a floating population". Today, the depopulated main island, Diego Garcia, over which the Union Jack flies, serves the "war on terror" as an American interrogation and torture centre.
When you bear this in mind, the US presidential race becomes surreal. The beatification of President Barack Obama is already under way; for it is he who "challenges America to rise up [and] summon 'the better angels of our nature'", says Rolling Stone magazine, reminiscent of the mating calls of Guardian writers to the "mystical" Blair. As ever, the Orwell Inversion Test is necessary. Obama claims that his vast campaign wealth comes from small individual donors, yet he has also received funds from some of the most notorious looters on Wall Street. Moreover, the "dove" and "candidate of change" has voted repeatedly to fund George W Bush's rapacious wars, and now demands more war in Afghanistan while he threatens to bomb Pakistan.
Dismissing the popular democracies in Latin America as a "vacuum" to be filled by the United States, he has endorsed Colombia's "right to strike terrorists who seek safe havens across its borders". Translated, this means the "right" of the criminal regime in that country to invade its neighbours, notably uppity Venezuela, on Washington's behalf. The British human rights group Justice for Colombia has just published a study concerning Anglo-American backing for the Colombian regime of Álvaro Uribe, which is responsible for more than 90 per cent of all cases of torture. The principal torturers, the "security forces", are trained by the Americans and the British. The Foreign Office replies that it is "improving the human rights record of the military and combating drug trafficking". The study finds not a shred of evidence to support this. Colombian officers with barbaric records, such as those implicated in the murder of a trade union leader, are welcomed to Britain for "seminars".
As in many parts of the world, the British role is that of subcontractor to Washington. The bloody "Plan Colombia" was the design of Bill Clinton, the last Democratic president and inspiration for Blair's and Brown's new Labour. Clinton's administration was at least as violent as Bush's – see Unicef's report that 500,000 Iraqi children died as a result of the Anglo-American blockade in the 1990s.
The lesson learned is that no presidential candidate, least of all a Democrat awash with money from America's "banksters", as Franklin Roosevelt called them, can or will challenge a militarised system that controls and rewards him. Obama's job is to present a benign, even progressive face that will revive America's democratic pretensions, internationally and domestically, while ensuring nothing of substance changes.
Among ordinary Americans desperate for a secure life, his skin colour may help him regain this unjustified "trust", even though it is of a similar hue to that of Colin Powell, who lied to the United Nations for Bush and now endorses Obama. As for the rest of us, is it not time we opened our eyes and exercised our right not to be lied to, yet again?
By John Pilger
In 1992, Mark Higson, the Foreign Office official responsible for Iraq, appeared before the Scott inquiry into the scandal of arms sold illegally to Saddam Hussein. He described a "culture of lying" at the heart of British foreign policymaking. I asked him how frequently ministers and officials lied to parliament.
"It's systemic," he said. "The draft letters I wrote for various ministers were saying that nothing had changed, the embargo on the sale of arms to Iraq was the same."
"Was that true?" I asked.
"No, it wasn't true."
"And your superiors knew it wasn't true?"
"Yes."
"So how much truth did the public get?"
"The public got as much truth as we could squeeze out, given that we told downright lies."
From British involvement with the genocidal Khmer Rouge in Cambodia, to the supply of warplanes to the Indonesian dictator Suharto, knowing he was bombing civilians in East Timor, to the denial of vaccines and other humanitarian aid to the children of Iraq, my experience with the Foreign Office is that Higson was right and remains right.
As I write this, the dispossessed people of the Chagos Islands in the Indian Ocean await the decision of the Law Lords, hoping for a repetition of four previous judgments that their brutal expulsion to make way for a US military base was "outrageous", "illegal" and "repugnant". That they must endure yet another appeal is thanks to the Foreign Office – whose legal adviser in 1968, one Anthony Ivall Aust (pronounced "oarst" and since knighted), wrote a secret document headed "Maintaining the fiction". This advised the then Labour government to "argue" the "fiction" that the Chagossians were "only a floating population". Today, the depopulated main island, Diego Garcia, over which the Union Jack flies, serves the "war on terror" as an American interrogation and torture centre.
When you bear this in mind, the US presidential race becomes surreal. The beatification of President Barack Obama is already under way; for it is he who "challenges America to rise up [and] summon 'the better angels of our nature'", says Rolling Stone magazine, reminiscent of the mating calls of Guardian writers to the "mystical" Blair. As ever, the Orwell Inversion Test is necessary. Obama claims that his vast campaign wealth comes from small individual donors, yet he has also received funds from some of the most notorious looters on Wall Street. Moreover, the "dove" and "candidate of change" has voted repeatedly to fund George W Bush's rapacious wars, and now demands more war in Afghanistan while he threatens to bomb Pakistan.
Dismissing the popular democracies in Latin America as a "vacuum" to be filled by the United States, he has endorsed Colombia's "right to strike terrorists who seek safe havens across its borders". Translated, this means the "right" of the criminal regime in that country to invade its neighbours, notably uppity Venezuela, on Washington's behalf. The British human rights group Justice for Colombia has just published a study concerning Anglo-American backing for the Colombian regime of Álvaro Uribe, which is responsible for more than 90 per cent of all cases of torture. The principal torturers, the "security forces", are trained by the Americans and the British. The Foreign Office replies that it is "improving the human rights record of the military and combating drug trafficking". The study finds not a shred of evidence to support this. Colombian officers with barbaric records, such as those implicated in the murder of a trade union leader, are welcomed to Britain for "seminars".
As in many parts of the world, the British role is that of subcontractor to Washington. The bloody "Plan Colombia" was the design of Bill Clinton, the last Democratic president and inspiration for Blair's and Brown's new Labour. Clinton's administration was at least as violent as Bush's – see Unicef's report that 500,000 Iraqi children died as a result of the Anglo-American blockade in the 1990s.
The lesson learned is that no presidential candidate, least of all a Democrat awash with money from America's "banksters", as Franklin Roosevelt called them, can or will challenge a militarised system that controls and rewards him. Obama's job is to present a benign, even progressive face that will revive America's democratic pretensions, internationally and domestically, while ensuring nothing of substance changes.
Among ordinary Americans desperate for a secure life, his skin colour may help him regain this unjustified "trust", even though it is of a similar hue to that of Colin Powell, who lied to the United Nations for Bush and now endorses Obama. As for the rest of us, is it not time we opened our eyes and exercised our right not to be lied to, yet again?
Bush, Boehner Want DOJ to Look Into Ohio Voting
Go to Original
By Matthew Murray
President Bush is asking the Justice Department to look into whether 200,000 Buckeye State poll-goers must use provisional ballots on Election Day because their names do not match state databases.
White House spokesman Carlton Carroll confirmed Friday that the president will forward a letter to Attorney General Michael Mukasey from House Minority Leader John Boehner (R-Ohio), requesting that the Justice Department look into whether the state’s voter rolls comply with the Help America Vote Act.
In a letter dated on Friday, the House GOP leader wrote that with Election Day “less than two weeks away, immediate action by the Department is not only warranted, but also crucial.”
“I respectfully request that you use your authority to direct Attorney General Michael Mukasey and the U.S. Department of Justice to investigate these actions and direct the appropriate authorities in each state to comply with the Section 303 requirements of HAVA,” Boehner wrote.
“Unless action is taken by the Department immediately, thousands, if not tens or hundreds of thousands, of names whose information has not been verified through the HAVA procedures mandated by Congress will remain on voter rolls during the November 4, 2008 election; and there is a significant risk — if not a certainty, that unlawful votes will be cast and counted.”
The U.S. Supreme Court last Friday threw out a Republican-led effort in Ohio that would have required 200,000 voters to cast provisional ballots on Nov. 4 because of misspellings, incorrect addresses or other inconsistencies in their records.
Secretary of State Jennifer Brunner and other Ohio Democrats argue that requiring individuals with inconsistent registrations to cast their ballots provisionally may lead to unfair post-Election Day scrutiny of their eligibility.
By Matthew Murray
President Bush is asking the Justice Department to look into whether 200,000 Buckeye State poll-goers must use provisional ballots on Election Day because their names do not match state databases.
White House spokesman Carlton Carroll confirmed Friday that the president will forward a letter to Attorney General Michael Mukasey from House Minority Leader John Boehner (R-Ohio), requesting that the Justice Department look into whether the state’s voter rolls comply with the Help America Vote Act.
In a letter dated on Friday, the House GOP leader wrote that with Election Day “less than two weeks away, immediate action by the Department is not only warranted, but also crucial.”
“I respectfully request that you use your authority to direct Attorney General Michael Mukasey and the U.S. Department of Justice to investigate these actions and direct the appropriate authorities in each state to comply with the Section 303 requirements of HAVA,” Boehner wrote.
“Unless action is taken by the Department immediately, thousands, if not tens or hundreds of thousands, of names whose information has not been verified through the HAVA procedures mandated by Congress will remain on voter rolls during the November 4, 2008 election; and there is a significant risk — if not a certainty, that unlawful votes will be cast and counted.”
The U.S. Supreme Court last Friday threw out a Republican-led effort in Ohio that would have required 200,000 voters to cast provisional ballots on Nov. 4 because of misspellings, incorrect addresses or other inconsistencies in their records.
Secretary of State Jennifer Brunner and other Ohio Democrats argue that requiring individuals with inconsistent registrations to cast their ballots provisionally may lead to unfair post-Election Day scrutiny of their eligibility.
'Sub rosa SOFA brings darkness to Iraq'
Go to Original
The controversial US-Iraq security agreement includes 'some secret provisions', which would flagrantly violate Iraq's sovereignty.
Secret provisions have been incorporated in the so-called Status of Forces Agreement (SOFA), which would violate Iraq's sovereignty in a more direct manner than the provisions disclosed by the Iraqi media, the Saudi daily Okaz reported on Sunday, citing "informed political sources".
According to the report, although "the secret provisions" would have more adverse consequences for Iraq in terms of the country's sovereignty and independence, a majority of Iraqi lawmakers have been kept entirely unaware of them.
Based on those provisions, the US would be granted the permission to build military bases, camps and prisons inside Iraq. The scope of the immunity from legal prosecution for the US forces--the most controversial provision of SOFA-- would also be extended to include all US security, military and civilian firms as well as the US army's contractors.
Under the terms of SOFA, Iraqi officials would be prohibited from meddling in operations carried out by US forces or limiting their authority. The US would also be allowed to attack any country, which "represents a security threat to Iraq" from the country's soil.
After signing the deal, Baghdad would be obliged to ask for Washington's approval before concluding any regional or international agreements with third countries.
According to the Okaz report, SOFA would bring the Iraqi key ministries of defense and interior under US control for 10 years to facilitate "the training of the Iraqi forces."
The Saudi newspaper also claimed that under the secret provisions, no timetable would be set for the withdrawal of US troops form Iraq and any pull-out would depend on several conditions.
The conditions for any US withdrawal include the readiness of Iraqi forces, the success in fighting terrorism, the removal of "the neighboring countries' security threats", national reconciliation and a consensus among all Iraqi political groups on the issue. Washington would be entitled to stay in Iraq, if even one of those conditions were not fulfilled.
Based on those SOFA provisions which have made public, the US forces must leave the war-torn country by early 2011 without any preconditions.
The report also ruled out the possibility that the US and Iraq would reach an agreement before the term of US President George W. Bush in office ends.
The failure to sign the deal, according to the daily, should be considered as a setback for the Bush administration which is seeking to play the card of SOFA to strengthen the position of the Republican Party before the upcoming US presidential elections.
The controversial US-Iraq security agreement includes 'some secret provisions', which would flagrantly violate Iraq's sovereignty.
Secret provisions have been incorporated in the so-called Status of Forces Agreement (SOFA), which would violate Iraq's sovereignty in a more direct manner than the provisions disclosed by the Iraqi media, the Saudi daily Okaz reported on Sunday, citing "informed political sources".
According to the report, although "the secret provisions" would have more adverse consequences for Iraq in terms of the country's sovereignty and independence, a majority of Iraqi lawmakers have been kept entirely unaware of them.
Based on those provisions, the US would be granted the permission to build military bases, camps and prisons inside Iraq. The scope of the immunity from legal prosecution for the US forces--the most controversial provision of SOFA-- would also be extended to include all US security, military and civilian firms as well as the US army's contractors.
Under the terms of SOFA, Iraqi officials would be prohibited from meddling in operations carried out by US forces or limiting their authority. The US would also be allowed to attack any country, which "represents a security threat to Iraq" from the country's soil.
After signing the deal, Baghdad would be obliged to ask for Washington's approval before concluding any regional or international agreements with third countries.
According to the Okaz report, SOFA would bring the Iraqi key ministries of defense and interior under US control for 10 years to facilitate "the training of the Iraqi forces."
The Saudi newspaper also claimed that under the secret provisions, no timetable would be set for the withdrawal of US troops form Iraq and any pull-out would depend on several conditions.
The conditions for any US withdrawal include the readiness of Iraqi forces, the success in fighting terrorism, the removal of "the neighboring countries' security threats", national reconciliation and a consensus among all Iraqi political groups on the issue. Washington would be entitled to stay in Iraq, if even one of those conditions were not fulfilled.
Based on those SOFA provisions which have made public, the US forces must leave the war-torn country by early 2011 without any preconditions.
The report also ruled out the possibility that the US and Iraq would reach an agreement before the term of US President George W. Bush in office ends.
The failure to sign the deal, according to the daily, should be considered as a setback for the Bush administration which is seeking to play the card of SOFA to strengthen the position of the Republican Party before the upcoming US presidential elections.
Warnings of deep recession as US layoffs spread coast-to-coast
Go to Original
By Patrick O’Connor
Dozens of mass layoffs have been announced by American employers, both private and public, in recent days. The impact of the downturn has begun to spread well beyond the imploding financial sector and such depressed industries as automobiles, to the economy as a whole.
The United States has now entered what analysts widely anticipate will be the worst recession in more than a quarter of a century. JPMorgan Chase economists estimated Friday that gross domestic product fell an annual rate of 0.5 percent in the third quarter this year, and forecasted a decline of 4 percent in the three months up to December. This would mark the steepest decline since the 1981-82 recession.
Unemployment is set to rapidly increase. "My view is that it will be near 8 or 8.5 percent by the end of next year," Nigel Gault, chief domestic economist at Global Insight, told the New York Times.
According to statistics collated by outplacement firm Challenger, Gray & Christmas, the top five sectors for layoffs in the nine months through September this year are: financial, with 111,200 job cuts; automotive, 94,900 layoffs; government/non-profit, 66,800 layoffs; transportation, 62,000 layoffs; and retail, with 51,300 jobs lost.
Seventeen of the US's 29 steel mill blast furnaces have shut down in response to slowing demand. This is set to accelerate the slowdown in production which saw output decline 4 percent in the month from August to September. Chicago-based steel analyst Michelle Applebaum told the Times these figures reflected "nearly instantaneous production cuts in response to declines in global steel demand as steel buyers deferred purchases in favor of living on their own inventories during this period of uncertainty."
The US auto giants have announced new rounds of job cuts nearly every day over the past fortnight. On Friday, Chrysler revealed that 25 percent of its salaried employees would be sacked before the end of the year, and that further restructuring will be seen "in the near future". The announcement affects approximately 5,000 white-collar workers and came just a day after Chrysler revealed plans to cut 1,825 other jobs. A company spokesperson said the cuts were driven by declining domestic sales and were not related to a potential merger either with General Motors (GM) or Nissan and Renault.
Auto industry experts rejected this claim. "The people they're cutting probably wouldn't go forward, with the various alternatives they're looking at," Van Conway, senior managing partner with Detroit restructuring firm Conway MacKenzie & Dunleavy, told the Wall Street Journal. "Why carry them if GM or Renault or whoever is going to take over? They're cutting things out, clearly, and they appear to be a seller. It's pretty obvious."
The layoffs are a mere foretaste of the tens of thousands of job cuts that will accompany a finalized merger involving the major auto companies.
GM last week announced it was suspending many salaried employee benefits, including matching contributions for workers' 401(k) retirement plans, and also said it planned to cut an unspecified number of jobs in its salaried and contract workforce in late 2008 and early 2009. In another indicator of the former industrial giant's rapid decline, the Journal reported Saturday that Toyota would likely supplant GM as the world's top selling auto maker for October. GM has held the leading position for more than 50 years.
The downturn across the manufacturing sector is set to exacerbate the social crisis already affecting wide layers of the working and middle classes. States dependent on industrial employment such as Michigan and Rhode Island, with official jobless rates of 8.7 and 8.8 percent respectively, have been particularly hard hit.
The job cuts have spread from coast-to-coast and affect every industry and many service employers as well. Auto-related production has been hard hit, with Diez Group announcing the closure of three Michigan metal-stamping plants, cutting 352 jobs. DMAX, a joint venture of GM and Isuzu in Moraine, Ohio, cut 300 jobs. B.F. Goodrich cut 500 jobs at its tire plant in Woodburn, Indiana. Thomas-Built cut 205 jobs at its bus plant in High Point, North Carolina.
Other industrial cuts included a combined total of 1,000 jobs at three North Carolina factories now set to close: Silver Line Building Products in Durham, UCO Fabrics in Rockingham, and IWC Direct at Elm City. ADC Telecommunications cut 190 jobs in Minnesota, and Align Technologies 111 jobs in Santa Clara, California.
Healthcare and public services are also beginning to be hit. Cambridge Health Alliance in Massachusetts cut 650 jobs, Blue Cross Blue Shield of Michigan 100, and the University of Pittsburgh Medical Center 500. Lost Angeles County gave layoff notices to 200 workers because of a budget shortfall.
Even greater public service jobs cuts are coming as the recession hits state tax receipts. One of the biggest government employers, the US Postal Service, has informed its unions that 16,000 craft employees are not covered by the no-layoff clause and could face dismissal.
The Bush administration has proposed no emergency rescue package for the millions of ordinary Americans threatened with the loss of their jobs, homes, or savings. As the recession deepens, discussion has instead centered on extending the financial sector bailout, potentially worth more than $2 trillion, to broader sections of big business.
The Wall Street Journal reported Saturday: "The Treasury Department is considering buying equity stakes in insurance companies, a sign of how the government's $700 billion rescue program could turn into a piggy bank for a range of beleaguered industries ... The Financial Services Roundtable, a Washington trade group, sent a letter Friday to Treasury asking for expansion of the government's equity injection program to include broker-dealers, insurance companies, auto makers and foreign-controlled firms."
Insurance companies are major players on the financial markets, with $1.3 trillion of corporate debt on their books. The Treasury had already planned to buy out the industry's "bad assets", and is now considering whether to inject more public money directly into the sector by purchasing equity stakes. Auto companies want to be included in the scheme so they have access to sufficient capital to proceed with merger plans. The Journal noted that the likely extension of the bailout program "could put a strain" on the sum of money initially proposed, further blowing out the federal government's budget deficit.
The overriding priority of the ruling elite is to ensure that the financial oligarchy which is responsible for the economic crisis remains unaffected by its impact by placing the full burden of the disaster on the backs of the working class. This strategy will remain unaltered in the event of a Democratic victory in the coming presidential election.
Barack Obama's senior economic advisor, Robert Rubin, granted a revealing interview to CBS's "Face the Nation" television program yesterday. Rubin, currently a director of Citigroup, was Treasury secretary during the Clinton administration and is also a former senior executive with Goldman Sachs. He stressed that additional spending under the Democrats' so-called "economic recovery" stimulus plan would be "married to a commitment to long-term fiscal discipline so that we don't risk undermining our bond market and our currency market" and "married with a long-term commitment to re-establishing sound fiscal conditions".
In other words, the agenda remains that of substantially reduced spending on social programs and infrastructure.
The Democrats' proposed $150 billion stimulus is a mere drop in the ocean compared to the bailout package for Wall Street, not to mention the real social needs of the population. But even this meager sum will be targeted towards boosting selected economic sectors, not alleviating rising social distress.
CBS presenter Bob Schieffer asked Rubin whether the stimulus package would involve "some sort of massive public works program like President Roosevelt put into effect during the Great Depression," or whether it would see people in need receiving government checks.
After chuckling in derision after the 1930s public works programs were mentioned, Rubin replied: "Bob, I would say it's neither of the two in quite the way you've described it." He explained that the money would be channeled to city and state administrations so that existing economic and social programs—which are grossly inadequate—can be maintained. He also said that additional tax rebates would be made available.
A New York Times' front-page story yesterday, "Democrats see risk and reward if party sweeps", made clear that there will be no significant shift in domestic economic and social policy even if, as appears likely, the Democrats win the presidency and large majorities in both houses of Congress. Such a victory, the Times' noted, including a 60-member majority in the senate which would break threatened filibusters, "could give Democrats extraordinary muscle to pursue an ambitious agenda on health care, taxes, union rights, energy and national security".
But the article continued: "Chastened by their years in exile, Democrats said they were determined to avoid those pitfalls [of ‘overconfidence'] should voters deliver them control of the White House and Congress... The nature of the Democratic majority, expanded partly through the election of centrists and even conservatives, would also temper Democratic zeal to pursue an overly ideological agenda, Democrats said."
Under the spurious guise of appealing to "centrists" and eschewing an "ideological agenda", Obama and his colleagues are preparing to further entrench the right-wing agenda promoted by successive Republican and Democratic administrations. These developments have exposed Obama's liberal and "left" backers, who have sought to cultivate the illusion that a Democrat election victory would mark some sort of break from Bush's reactionary program.
By Patrick O’Connor
Dozens of mass layoffs have been announced by American employers, both private and public, in recent days. The impact of the downturn has begun to spread well beyond the imploding financial sector and such depressed industries as automobiles, to the economy as a whole.
The United States has now entered what analysts widely anticipate will be the worst recession in more than a quarter of a century. JPMorgan Chase economists estimated Friday that gross domestic product fell an annual rate of 0.5 percent in the third quarter this year, and forecasted a decline of 4 percent in the three months up to December. This would mark the steepest decline since the 1981-82 recession.
Unemployment is set to rapidly increase. "My view is that it will be near 8 or 8.5 percent by the end of next year," Nigel Gault, chief domestic economist at Global Insight, told the New York Times.
According to statistics collated by outplacement firm Challenger, Gray & Christmas, the top five sectors for layoffs in the nine months through September this year are: financial, with 111,200 job cuts; automotive, 94,900 layoffs; government/non-profit, 66,800 layoffs; transportation, 62,000 layoffs; and retail, with 51,300 jobs lost.
Seventeen of the US's 29 steel mill blast furnaces have shut down in response to slowing demand. This is set to accelerate the slowdown in production which saw output decline 4 percent in the month from August to September. Chicago-based steel analyst Michelle Applebaum told the Times these figures reflected "nearly instantaneous production cuts in response to declines in global steel demand as steel buyers deferred purchases in favor of living on their own inventories during this period of uncertainty."
The US auto giants have announced new rounds of job cuts nearly every day over the past fortnight. On Friday, Chrysler revealed that 25 percent of its salaried employees would be sacked before the end of the year, and that further restructuring will be seen "in the near future". The announcement affects approximately 5,000 white-collar workers and came just a day after Chrysler revealed plans to cut 1,825 other jobs. A company spokesperson said the cuts were driven by declining domestic sales and were not related to a potential merger either with General Motors (GM) or Nissan and Renault.
Auto industry experts rejected this claim. "The people they're cutting probably wouldn't go forward, with the various alternatives they're looking at," Van Conway, senior managing partner with Detroit restructuring firm Conway MacKenzie & Dunleavy, told the Wall Street Journal. "Why carry them if GM or Renault or whoever is going to take over? They're cutting things out, clearly, and they appear to be a seller. It's pretty obvious."
The layoffs are a mere foretaste of the tens of thousands of job cuts that will accompany a finalized merger involving the major auto companies.
GM last week announced it was suspending many salaried employee benefits, including matching contributions for workers' 401(k) retirement plans, and also said it planned to cut an unspecified number of jobs in its salaried and contract workforce in late 2008 and early 2009. In another indicator of the former industrial giant's rapid decline, the Journal reported Saturday that Toyota would likely supplant GM as the world's top selling auto maker for October. GM has held the leading position for more than 50 years.
The downturn across the manufacturing sector is set to exacerbate the social crisis already affecting wide layers of the working and middle classes. States dependent on industrial employment such as Michigan and Rhode Island, with official jobless rates of 8.7 and 8.8 percent respectively, have been particularly hard hit.
The job cuts have spread from coast-to-coast and affect every industry and many service employers as well. Auto-related production has been hard hit, with Diez Group announcing the closure of three Michigan metal-stamping plants, cutting 352 jobs. DMAX, a joint venture of GM and Isuzu in Moraine, Ohio, cut 300 jobs. B.F. Goodrich cut 500 jobs at its tire plant in Woodburn, Indiana. Thomas-Built cut 205 jobs at its bus plant in High Point, North Carolina.
Other industrial cuts included a combined total of 1,000 jobs at three North Carolina factories now set to close: Silver Line Building Products in Durham, UCO Fabrics in Rockingham, and IWC Direct at Elm City. ADC Telecommunications cut 190 jobs in Minnesota, and Align Technologies 111 jobs in Santa Clara, California.
Healthcare and public services are also beginning to be hit. Cambridge Health Alliance in Massachusetts cut 650 jobs, Blue Cross Blue Shield of Michigan 100, and the University of Pittsburgh Medical Center 500. Lost Angeles County gave layoff notices to 200 workers because of a budget shortfall.
Even greater public service jobs cuts are coming as the recession hits state tax receipts. One of the biggest government employers, the US Postal Service, has informed its unions that 16,000 craft employees are not covered by the no-layoff clause and could face dismissal.
The Bush administration has proposed no emergency rescue package for the millions of ordinary Americans threatened with the loss of their jobs, homes, or savings. As the recession deepens, discussion has instead centered on extending the financial sector bailout, potentially worth more than $2 trillion, to broader sections of big business.
The Wall Street Journal reported Saturday: "The Treasury Department is considering buying equity stakes in insurance companies, a sign of how the government's $700 billion rescue program could turn into a piggy bank for a range of beleaguered industries ... The Financial Services Roundtable, a Washington trade group, sent a letter Friday to Treasury asking for expansion of the government's equity injection program to include broker-dealers, insurance companies, auto makers and foreign-controlled firms."
Insurance companies are major players on the financial markets, with $1.3 trillion of corporate debt on their books. The Treasury had already planned to buy out the industry's "bad assets", and is now considering whether to inject more public money directly into the sector by purchasing equity stakes. Auto companies want to be included in the scheme so they have access to sufficient capital to proceed with merger plans. The Journal noted that the likely extension of the bailout program "could put a strain" on the sum of money initially proposed, further blowing out the federal government's budget deficit.
The overriding priority of the ruling elite is to ensure that the financial oligarchy which is responsible for the economic crisis remains unaffected by its impact by placing the full burden of the disaster on the backs of the working class. This strategy will remain unaltered in the event of a Democratic victory in the coming presidential election.
Barack Obama's senior economic advisor, Robert Rubin, granted a revealing interview to CBS's "Face the Nation" television program yesterday. Rubin, currently a director of Citigroup, was Treasury secretary during the Clinton administration and is also a former senior executive with Goldman Sachs. He stressed that additional spending under the Democrats' so-called "economic recovery" stimulus plan would be "married to a commitment to long-term fiscal discipline so that we don't risk undermining our bond market and our currency market" and "married with a long-term commitment to re-establishing sound fiscal conditions".
In other words, the agenda remains that of substantially reduced spending on social programs and infrastructure.
The Democrats' proposed $150 billion stimulus is a mere drop in the ocean compared to the bailout package for Wall Street, not to mention the real social needs of the population. But even this meager sum will be targeted towards boosting selected economic sectors, not alleviating rising social distress.
CBS presenter Bob Schieffer asked Rubin whether the stimulus package would involve "some sort of massive public works program like President Roosevelt put into effect during the Great Depression," or whether it would see people in need receiving government checks.
After chuckling in derision after the 1930s public works programs were mentioned, Rubin replied: "Bob, I would say it's neither of the two in quite the way you've described it." He explained that the money would be channeled to city and state administrations so that existing economic and social programs—which are grossly inadequate—can be maintained. He also said that additional tax rebates would be made available.
A New York Times' front-page story yesterday, "Democrats see risk and reward if party sweeps", made clear that there will be no significant shift in domestic economic and social policy even if, as appears likely, the Democrats win the presidency and large majorities in both houses of Congress. Such a victory, the Times' noted, including a 60-member majority in the senate which would break threatened filibusters, "could give Democrats extraordinary muscle to pursue an ambitious agenda on health care, taxes, union rights, energy and national security".
But the article continued: "Chastened by their years in exile, Democrats said they were determined to avoid those pitfalls [of ‘overconfidence'] should voters deliver them control of the White House and Congress... The nature of the Democratic majority, expanded partly through the election of centrists and even conservatives, would also temper Democratic zeal to pursue an overly ideological agenda, Democrats said."
Under the spurious guise of appealing to "centrists" and eschewing an "ideological agenda", Obama and his colleagues are preparing to further entrench the right-wing agenda promoted by successive Republican and Democratic administrations. These developments have exposed Obama's liberal and "left" backers, who have sought to cultivate the illusion that a Democrat election victory would mark some sort of break from Bush's reactionary program.
Greenspan Says, "Who Could Have Known?"
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By Dean Baker
That’s right, the former Maestro told Congress last week, when asked about the meltdown of the housing bubble and the resulting financial crisis, "we’re not smart enough as people. We just cannot see events that far in advance."
By Dean Baker
That’s right, the former Maestro told Congress last week, when asked about the meltdown of the housing bubble and the resulting financial crisis, "we’re not smart enough as people. We just cannot see events that far in advance."
Unfortunately, this sentence is even worse in context. Greenspan told the committee about the brilliant economists on staff at the Federal Reserve Board. His point was that if this group could not see the housing bubble, and the risks it posed to the economy, then it was not humanly possible to see it.
The reality is that it was possible - in fact, easy - to recognize the housing bubble as early as the summer of 2002. House prices nationwide had substantially outpaced inflation in the years since 1996 (coinciding with the stock bubble) after just tracking the rate of inflation for the prior hundred years. There was nothing in the fundamentals of supply or demand that could explain this run-up.
Furthermore, there was no corresponding increase in rents. Since people always have the choice to buy or rent, house sale prices and rents should rise and fall together over time, although not necessarily at the exact same pace. In the years since 1996, rents had only modestly outpaced inflation. And they had begun dropping in real terms by 2002. This was not consistent with house prices being driven by fundamentals.
It was also easy to see that the collapse of the housing bubble would cause enormous damage to the economy. Housing itself accounted for more than 6 percent of GDP at the peak of the boom in 2006. Today, it accounts for just over 3 percent.
More importantly, housing wealth provided the base for the consumption boom of this period. Research from the Federal Reserve Board and elsewhere shows that annual consumption is increased by 5 to 7 cents for each dollar of housing wealth. This means that the collapse of a bubble that eventually grew to $8 trillion would lead to a reduction in annual consumption on the order of $400 billion to $560 billion (2.6 percent to 3.7 percent of GDP).
In addition, housing is a highly leveraged asset. In normal times, buyers typically borrow 80 to 90 percent of the purchase price. Of course, housing became much more highly leveraged during the bubble with many borrowers putting zero down.
The heavy leverage in the housing market meant that it was inconceivable that a collapse of the housing bubble would not lead to serious consequences for the banking industry. I first warned that the collapse of the bubble would imperil the survival of Fannie Mae and Freddie Mac in September of 2002.
Greenspan would have been correct if he said that we are not smart enough as human beings to know when the bubble would finally burst. I did not expect the bubble to last as long as it did.
Of course, I did not bet on there being such a vast reservoir of foolish investors, not only in the United States but also in Asia and Europe, willing to buy garbage mortgages buried in complex derivative instruments. I also didn’t imagine the Fed and other regulatory agencies would ever be so completely out-to-lunch in policing mortgage issuance and the practices of the investment banks.
But the basic story, that there was a housing bubble that would burst, and that it would cause enormous damage to the economy, was completely knowable to any competent economist long ago. The failure of the economists at the Fed, as well as the vast majority of the economists elsewhere, to see the housing bubble and to recognize the damage that would be caused by its collapse, is a testament to the failure of the profession.
Greenspan’s claim that the crisis was not foreseeable is a cover-up for a profession that has badly failed the public. If factory workers or custodians had failed so miserably in their jobs, they would quickly find themselves unemployed.
Remarkably, in economics, the people responsible for this easily preventable disaster are suffering no negative consequences and, in fact, are still the ones designing the nation’s economic policies. Economists believe that if workers are not held accountable for their performance, then they will not do good work. If economists are not held accountable for their performance, then we should not expect good economic policy.
Contrary to what Greenspan told Congress, "we" are smart enough as people to see asset bubbles like the housing bubble. If his "we" are not smart enough, as he claims, then the current group of economic policymakers must be replaced with people qualified to do the job.
US Threatens To Halt Services to Iraq Without Troop Accord
Go to Original
By Roy Gutman and Leila Fadel
The U.S. military has warned Iraq that it will shut down military operations and other vital services throughout the country on Jan. 1 if the Iraqi government doesn't agree to a new agreement on the status of U.S. forces or a renewed United Nations mandate for the American mission in Iraq.
Many Iraqi politicians view the move as akin to political blackmail, a top Iraqi official told McClatchy Sunday.
In addition to halting all military actions, U.S. forces would cease activities that support Iraq's economy, educational sector and other areas _ "everything" _ said Tariq al Hashimi, the country's Sunni Muslim vice president. "I didn't know the Americans are rendering such wide-scale services."
Hashimi said that Army Gen. Ray Odierno, the top U.S. military commander in Iraq, listed "tens" of areas of potential cutoffs in a three-page letter, and he said the implied threat caught Iraqi leaders by surprise.
"It was really shocking for us," he said. "Many people are looking to this attitude as a matter of blackmailing."
Odierno had no comment Sunday, but U.S. Embassy officials told McClatchy that a lengthy list of the sort Hashimi described has been passed to the Iraqi government. Among the services the U.S. provides are protection of Iraq's principal borders, of its oil exports and other shipping through the Shatt al Arab into the Persian Gulf and all air traffic control over Iraq.
The status of forces agreement, which calls for a final withdrawal of U.S. troops from Iraq by the end of 2011, was supposed to resolve a number of contentious issues between the two countries, but its completion 10 days ago has instead provoked a political crisis within Iraq's Shiite-dominated government and between Iraq and the United States.
Fearing a major battle in the Iraqi parliament, Prime Minister Nouri al Maliki solicited proposed amendments from his cabinet and called a meeting to review them Sunday afternoon.
However, the two main Shiite parties, Maliki's Dawa party and the Islamic Supreme Council of Iraq, were unable to produce their full lists of demands, and he postponed the meeting until Tuesday, other cabinet members said.
Hashimi said that Iran, a longtime backer of both parties, is pressuring Iraq's leaders not to accept the agreement.
The dispute "is real and factual. The government is not manipulating this dispute," Hashimi said. He said he hadn't yet seen the objections to the accord, even those from his own Sunni Iraqi Islamic Party.
Political party heads, including Hashimi, say that Maliki is responsible for the agreement, but Maliki has been unwilling to back the accord unless his Shiite coalition and other party members join him to take the political heat.
An additional complication is the decision of Hashimi's Iraqi Islamic party to suspend all "official communication" with U.S. military and civilian officials until it receives an explanation and an apology following a joint U.S.-Iraqi military raid against party backers in Anbar province in which one man was killed.
It's unclear what will happen when the Iraqi cabinet offers a list of proposed changes and Maliki winnows them down to proposed amendments.
Defense Secretary Robert Gates has said, "I don't think you slam the door shut" on amendments, but Hashimi said the U.S. is "adamant in saying, 'We close the door, we are not accepting any sort of amendment.' "
He said that if the United States met Iraq halfway and accepted amendments to the controversial articles of the accord, it would make it "rather easy" to submit the agreement to the parliament.
The alternative to a new agreement governing U.S. forces, an Iraqi request to the U.N. Security Council to extend the U.N. mandate, which now expires on Dec. 31, is also highly contentious.
One of the biggest concessions Iraq won from Washington in the negotiations over the forces accord was a stipulation that private contractors such as Blackwater that have been accused of killing Iraqi civilians would become subject to Iraqi law.
Immunity from prosecution for private contractors _ and for all official U.S. entities _ under Iraqi law was promulgated by the U.S. occupation government in June 2004, and ending that order is the subject of another confrontation between Iraq and the United States, Hashimi said. He said the United States insists that it would reject any Iraqi request to change the mandate.
Ironically, Iraqi politicians of practically every stripe agree that the proposed agreement would be a major advance toward restoring Iraq's full sovereignty and a vast improvement over the initial U.S. proposal made last spring.
He credited President Bush with changing the U.S. position as a result of twice-weekly conference calls with Maliki.
By Roy Gutman and Leila Fadel
The U.S. military has warned Iraq that it will shut down military operations and other vital services throughout the country on Jan. 1 if the Iraqi government doesn't agree to a new agreement on the status of U.S. forces or a renewed United Nations mandate for the American mission in Iraq.
Many Iraqi politicians view the move as akin to political blackmail, a top Iraqi official told McClatchy Sunday.
In addition to halting all military actions, U.S. forces would cease activities that support Iraq's economy, educational sector and other areas _ "everything" _ said Tariq al Hashimi, the country's Sunni Muslim vice president. "I didn't know the Americans are rendering such wide-scale services."
Hashimi said that Army Gen. Ray Odierno, the top U.S. military commander in Iraq, listed "tens" of areas of potential cutoffs in a three-page letter, and he said the implied threat caught Iraqi leaders by surprise.
"It was really shocking for us," he said. "Many people are looking to this attitude as a matter of blackmailing."
Odierno had no comment Sunday, but U.S. Embassy officials told McClatchy that a lengthy list of the sort Hashimi described has been passed to the Iraqi government. Among the services the U.S. provides are protection of Iraq's principal borders, of its oil exports and other shipping through the Shatt al Arab into the Persian Gulf and all air traffic control over Iraq.
The status of forces agreement, which calls for a final withdrawal of U.S. troops from Iraq by the end of 2011, was supposed to resolve a number of contentious issues between the two countries, but its completion 10 days ago has instead provoked a political crisis within Iraq's Shiite-dominated government and between Iraq and the United States.
Fearing a major battle in the Iraqi parliament, Prime Minister Nouri al Maliki solicited proposed amendments from his cabinet and called a meeting to review them Sunday afternoon.
However, the two main Shiite parties, Maliki's Dawa party and the Islamic Supreme Council of Iraq, were unable to produce their full lists of demands, and he postponed the meeting until Tuesday, other cabinet members said.
Hashimi said that Iran, a longtime backer of both parties, is pressuring Iraq's leaders not to accept the agreement.
The dispute "is real and factual. The government is not manipulating this dispute," Hashimi said. He said he hadn't yet seen the objections to the accord, even those from his own Sunni Iraqi Islamic Party.
Political party heads, including Hashimi, say that Maliki is responsible for the agreement, but Maliki has been unwilling to back the accord unless his Shiite coalition and other party members join him to take the political heat.
An additional complication is the decision of Hashimi's Iraqi Islamic party to suspend all "official communication" with U.S. military and civilian officials until it receives an explanation and an apology following a joint U.S.-Iraqi military raid against party backers in Anbar province in which one man was killed.
It's unclear what will happen when the Iraqi cabinet offers a list of proposed changes and Maliki winnows them down to proposed amendments.
Defense Secretary Robert Gates has said, "I don't think you slam the door shut" on amendments, but Hashimi said the U.S. is "adamant in saying, 'We close the door, we are not accepting any sort of amendment.' "
He said that if the United States met Iraq halfway and accepted amendments to the controversial articles of the accord, it would make it "rather easy" to submit the agreement to the parliament.
The alternative to a new agreement governing U.S. forces, an Iraqi request to the U.N. Security Council to extend the U.N. mandate, which now expires on Dec. 31, is also highly contentious.
One of the biggest concessions Iraq won from Washington in the negotiations over the forces accord was a stipulation that private contractors such as Blackwater that have been accused of killing Iraqi civilians would become subject to Iraqi law.
Immunity from prosecution for private contractors _ and for all official U.S. entities _ under Iraqi law was promulgated by the U.S. occupation government in June 2004, and ending that order is the subject of another confrontation between Iraq and the United States, Hashimi said. He said the United States insists that it would reject any Iraqi request to change the mandate.
Ironically, Iraqi politicians of practically every stripe agree that the proposed agreement would be a major advance toward restoring Iraq's full sovereignty and a vast improvement over the initial U.S. proposal made last spring.
He credited President Bush with changing the U.S. position as a result of twice-weekly conference calls with Maliki.
Global recession threatens mass lay-offs in China
Go to Original
By John Chan
A wave of protests by laid-off workers is a sign of what is to come as the global recession hits China. Like their counterparts in North America, Europe and elsewhere in the world, workers in China are being hit hard by accelerating plant closures, especially in the major export industries.
The latest example is Smart Union, one of the largest toy manufacturers in Dongguan city in the southern province of Guangdong. Around 7,000 people lost their jobs after the company, which manufactured items for US toy giants like Mattel and Disney, went bankrupt on October 17.
Workers immediately protested to demand their wages, severance pay and other benefits—2,000 gathered outside the local Zhangmutou district government office and another 100 workers outside the factory gate. Riot police with shields and clubs were deployed at the government building. The local government posted a sign at the factory gate warning that workers could be detained for 10-15 days for staging illegal protests, or ignoring orders from security officials. The confrontation only ended when the government promised to provide 24 million yuan ($3.5 million) to cover two months of unpaid wages.
A 42-year-old worker told Associated Press: "This financial crisis in America is going to kill us. It's already taking food out of our months." Most workers were migrants from rural areas. Song Xiaoguan, 25, told Agence France-Presse (AFP): "We thought about going to Shenzhen or even Shanghai. But then factories are also closing down in those places." Another worker said he feared returning to Fujian province where economic conditions were worse than Dongguan. "I do not want to go back home a poorer man, in debt, and unable to feed my family," he said.
Smart Union's liquidation followed a loss of $US26 million caused by weak demand and rising costs—a situation facing most export industries. Earlier this month, Dongguan mayor Li Yuquan told foreign reporters that more than 400 factories in the city had closed down in the first half of this year, posing a serious unemployment problem. China's customs agency announced last week that 52.7 percent of the country's toy exporting companies—3,631 in all—had ceased operations in the first seven months of the year.
Dongguan is located in the Pearl River Delta—one of the country's major manufacturing zones. The region turns out vast quantities of low-cost consumer goods such as toys, textiles, shoes, garments, home appliances and electronics for Western markets. Foreign investors from Hong Kong, Taiwan, Japan, US and Europe have flooded the region to set up factories since the 1980s.
In boom times, workers laboured in the atrocious conditions for long hours and low pay. Now millions of workers are losing their jobs. According to Chen Cheng-jen, chairman of the Federation of Hong Kong Industries, a quarter of small and medium Hong Kong-invested companies in the Pearl River Delta will be closed by next January, throwing 2.5 million workers out of work.
Since mid-October, workers from a series of closed factories across Guangdong province have held protests by blocking roads and highways. The demonstrations included: 1,000 workers from a Dongguan pet utility company, 700 workers from a Dongguan shoe factory, 500 workers from an electronic plant in Fushan and 500 workers from a Panyu textile firm. On October 13, 1,000 workers from a closed Taiwanese-owned factory in Dongguan's Dongcheng district blocked a road, demanding three months in unpaid wages. Riot police were brought in to disperse the protest and arrested more than 20 people.
Shenzhen, a major manufacturing city in the Pearl River Delta, has also witnessed growing unrest. BEP, a home appliance manufacturer, recently declared bankruptcy, leaving 1,500 workers jobless. Workers staged demonstrations on October 20-21 and guarded the factory to prevent assets being looted by creditors and suppliers. The Shenzhen labour bureau offered each worker just 300 yuan ($US44) in compensation.
Following the collapse of watch manufacturer Peace Mark, more than 800 workers from its plant in the Baoan district of Shenzhen staged a protest on October 21, demanding 4 million yuan in severance pay. Another 600 workers from its factory in the Longhua district demonstrated in front of the township government. On October 20, more than 900 workers from the bankrupt electronics firm Gangsheng in Longgang district kidnapped a Hong Kong driver demanding the government cover unpaid wages.
Economic downturn
The labour unrest in Guangdong indicates why the Chinese regime has just announced an economic stimulus package in a desperate bid to keep growth above 8 percent. Either Beijing creates sufficient jobs to absorb the growing workforce or it faces a social explosion. The growth rate for the third quarter had already slowed to 9 percent—down from almost 12 percent last year.
China's exports expanded more than 22 percent in the first three quarters—but the figure was down 4.8 percent from the same period last year. Stephen Green, China economist with Standard Chartered, forecast that exports could tumble to "zero or even negative growth" in 2009. JP Morgan Chase recently estimated that Chinese exports would fall 5.7 percent for every one percent shrinkage in global economic growth.
Guangdong's exports rose just 14 percent in the first seven months of this year—down from 27 percent for the same period last year. Industrial profits were up just 4 percent in the first five months of the year—compared to 49 percent for the same period last year.
The slowdown in exports is reverberating throughout the whole economy, dragging down the prices of homes, especially in the once booming coastal cities. Yan Yu, a Beijing University academic, told USA Today on October 21 that the property bubble is starting to burst. Housing prices in Dongguan, for instance, have fallen by up to 50 percent this year, leaving many families owing more on their mortgage than their home is worth. The downturn in real estate, which is partly driven by a growing outflow of speculative capital from China, will weaken domestic demand and further slow the economy.
Zheng Zizhen, labour expert at the Guangdong Academy of Social Sciences, told the South China Morning Post on October 17 that the "big ships" of manufacturing were sinking because of the recession in the US and Europe. "And we do not know how long the others can stand. It all depends on how strong they are, so the government should be prepared for possible labour problems," he warned.
The situation is no different in the region around Shanghai—another major manufacturing area. On October 7, Zhejiang River Dragon Textile Printing & Dyeing Co, one of the largest factories of its kind in China, shut down, leaving 4,000 workers in Shaoxing city jobless. Hundreds of workers joined protests, even as suppliers and creditors were busy looting assets from the complex. More than 10,000 textile companies throughout China went out of business in the first half of this year—that is, before the full impact of US financial crisis in September.
A program broadcast by state-run CCTV on September 13 focussed on the situation in Shengze, the "silk capital" in Jiangsu province, where 2,400 textile firms employed 250,000 workers. The reporter explained: "You can see a lot of small textile enterprises in Shengze. Most of them have only 30 or 40 machines and 10 or 20 workers. These companies are mostly working hard to just get by; some are closing down for a period and then starting up again. Although some are still in production, they are increasing inventory, like the company behind me here. According to locals, they haven't been operating since Chinese New Year [in February]. For companies like this, no one is sure who will make it."
Most migrant workers were staying put, hoping that things would get better. They depended on whatever shifts were available to get by. At Hengli Chemical Fibre, a large firm, the workforce had already been slashed by 1,500 jobs, due to increases in productivity. While the stronger companies may survive by hiring fewer workers, the small firms that employ the bulk of workers can only cut costs and wages or go bankrupt. "This has put many migrant workers in a very difficult situation," CCTV explained.
With 90 percent of its economy dependent on silk-related textiles, Shengze is just one of many manufacturing cities in eastern China that specialise in a single product. There are "shoe" towns, "zipper" towns, "air conditioner" towns and "sock" towns—each with hundreds of thousands and even millions of workers dependent on the production of just one commodity. Once celebrated for their large numbers of successful new entrepreneurs, these towns and cities are now highly vulnerable to global recession.
As the full force of the economic tsunami hits China in coming months, many of these new industrial cities will rapidly be transformed from economic miracles to centres of political turmoil as sacked workers confront factory owners, police and government authorities.
By John Chan
A wave of protests by laid-off workers is a sign of what is to come as the global recession hits China. Like their counterparts in North America, Europe and elsewhere in the world, workers in China are being hit hard by accelerating plant closures, especially in the major export industries.
The latest example is Smart Union, one of the largest toy manufacturers in Dongguan city in the southern province of Guangdong. Around 7,000 people lost their jobs after the company, which manufactured items for US toy giants like Mattel and Disney, went bankrupt on October 17.
Workers immediately protested to demand their wages, severance pay and other benefits—2,000 gathered outside the local Zhangmutou district government office and another 100 workers outside the factory gate. Riot police with shields and clubs were deployed at the government building. The local government posted a sign at the factory gate warning that workers could be detained for 10-15 days for staging illegal protests, or ignoring orders from security officials. The confrontation only ended when the government promised to provide 24 million yuan ($3.5 million) to cover two months of unpaid wages.
A 42-year-old worker told Associated Press: "This financial crisis in America is going to kill us. It's already taking food out of our months." Most workers were migrants from rural areas. Song Xiaoguan, 25, told Agence France-Presse (AFP): "We thought about going to Shenzhen or even Shanghai. But then factories are also closing down in those places." Another worker said he feared returning to Fujian province where economic conditions were worse than Dongguan. "I do not want to go back home a poorer man, in debt, and unable to feed my family," he said.
Smart Union's liquidation followed a loss of $US26 million caused by weak demand and rising costs—a situation facing most export industries. Earlier this month, Dongguan mayor Li Yuquan told foreign reporters that more than 400 factories in the city had closed down in the first half of this year, posing a serious unemployment problem. China's customs agency announced last week that 52.7 percent of the country's toy exporting companies—3,631 in all—had ceased operations in the first seven months of the year.
Dongguan is located in the Pearl River Delta—one of the country's major manufacturing zones. The region turns out vast quantities of low-cost consumer goods such as toys, textiles, shoes, garments, home appliances and electronics for Western markets. Foreign investors from Hong Kong, Taiwan, Japan, US and Europe have flooded the region to set up factories since the 1980s.
In boom times, workers laboured in the atrocious conditions for long hours and low pay. Now millions of workers are losing their jobs. According to Chen Cheng-jen, chairman of the Federation of Hong Kong Industries, a quarter of small and medium Hong Kong-invested companies in the Pearl River Delta will be closed by next January, throwing 2.5 million workers out of work.
Since mid-October, workers from a series of closed factories across Guangdong province have held protests by blocking roads and highways. The demonstrations included: 1,000 workers from a Dongguan pet utility company, 700 workers from a Dongguan shoe factory, 500 workers from an electronic plant in Fushan and 500 workers from a Panyu textile firm. On October 13, 1,000 workers from a closed Taiwanese-owned factory in Dongguan's Dongcheng district blocked a road, demanding three months in unpaid wages. Riot police were brought in to disperse the protest and arrested more than 20 people.
Shenzhen, a major manufacturing city in the Pearl River Delta, has also witnessed growing unrest. BEP, a home appliance manufacturer, recently declared bankruptcy, leaving 1,500 workers jobless. Workers staged demonstrations on October 20-21 and guarded the factory to prevent assets being looted by creditors and suppliers. The Shenzhen labour bureau offered each worker just 300 yuan ($US44) in compensation.
Following the collapse of watch manufacturer Peace Mark, more than 800 workers from its plant in the Baoan district of Shenzhen staged a protest on October 21, demanding 4 million yuan in severance pay. Another 600 workers from its factory in the Longhua district demonstrated in front of the township government. On October 20, more than 900 workers from the bankrupt electronics firm Gangsheng in Longgang district kidnapped a Hong Kong driver demanding the government cover unpaid wages.
Economic downturn
The labour unrest in Guangdong indicates why the Chinese regime has just announced an economic stimulus package in a desperate bid to keep growth above 8 percent. Either Beijing creates sufficient jobs to absorb the growing workforce or it faces a social explosion. The growth rate for the third quarter had already slowed to 9 percent—down from almost 12 percent last year.
China's exports expanded more than 22 percent in the first three quarters—but the figure was down 4.8 percent from the same period last year. Stephen Green, China economist with Standard Chartered, forecast that exports could tumble to "zero or even negative growth" in 2009. JP Morgan Chase recently estimated that Chinese exports would fall 5.7 percent for every one percent shrinkage in global economic growth.
Guangdong's exports rose just 14 percent in the first seven months of this year—down from 27 percent for the same period last year. Industrial profits were up just 4 percent in the first five months of the year—compared to 49 percent for the same period last year.
The slowdown in exports is reverberating throughout the whole economy, dragging down the prices of homes, especially in the once booming coastal cities. Yan Yu, a Beijing University academic, told USA Today on October 21 that the property bubble is starting to burst. Housing prices in Dongguan, for instance, have fallen by up to 50 percent this year, leaving many families owing more on their mortgage than their home is worth. The downturn in real estate, which is partly driven by a growing outflow of speculative capital from China, will weaken domestic demand and further slow the economy.
Zheng Zizhen, labour expert at the Guangdong Academy of Social Sciences, told the South China Morning Post on October 17 that the "big ships" of manufacturing were sinking because of the recession in the US and Europe. "And we do not know how long the others can stand. It all depends on how strong they are, so the government should be prepared for possible labour problems," he warned.
The situation is no different in the region around Shanghai—another major manufacturing area. On October 7, Zhejiang River Dragon Textile Printing & Dyeing Co, one of the largest factories of its kind in China, shut down, leaving 4,000 workers in Shaoxing city jobless. Hundreds of workers joined protests, even as suppliers and creditors were busy looting assets from the complex. More than 10,000 textile companies throughout China went out of business in the first half of this year—that is, before the full impact of US financial crisis in September.
A program broadcast by state-run CCTV on September 13 focussed on the situation in Shengze, the "silk capital" in Jiangsu province, where 2,400 textile firms employed 250,000 workers. The reporter explained: "You can see a lot of small textile enterprises in Shengze. Most of them have only 30 or 40 machines and 10 or 20 workers. These companies are mostly working hard to just get by; some are closing down for a period and then starting up again. Although some are still in production, they are increasing inventory, like the company behind me here. According to locals, they haven't been operating since Chinese New Year [in February]. For companies like this, no one is sure who will make it."
Most migrant workers were staying put, hoping that things would get better. They depended on whatever shifts were available to get by. At Hengli Chemical Fibre, a large firm, the workforce had already been slashed by 1,500 jobs, due to increases in productivity. While the stronger companies may survive by hiring fewer workers, the small firms that employ the bulk of workers can only cut costs and wages or go bankrupt. "This has put many migrant workers in a very difficult situation," CCTV explained.
With 90 percent of its economy dependent on silk-related textiles, Shengze is just one of many manufacturing cities in eastern China that specialise in a single product. There are "shoe" towns, "zipper" towns, "air conditioner" towns and "sock" towns—each with hundreds of thousands and even millions of workers dependent on the production of just one commodity. Once celebrated for their large numbers of successful new entrepreneurs, these towns and cities are now highly vulnerable to global recession.
As the full force of the economic tsunami hits China in coming months, many of these new industrial cities will rapidly be transformed from economic miracles to centres of political turmoil as sacked workers confront factory owners, police and government authorities.
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