Archive for January 19th, 2008
The financial panic of 1873
A major economic reversal began in Europe and reached the United States in the fall of 1873. The signal event on this side of the Atlantic was the failure of Jay Cooke and Company, the country’s preeminent investment banking concern. The firm was the principal backer of the Northern Pacific Railroad and had handled most of the government’s wartime loans. Cooke’s fall touched off a series of events that encompassed the entire nation.
The New York Stock Exchange was closed for 10 days. Credit dried up, foreclosures were common and banks failed. Factories closed their doors, costing thousands of workers’ jobs. The volume of destitute people soon overwhelmed the abilities of charities to function. Most of the major railroads failed.
The public tended to blame President Grant and Congress for mishandling the economy. The causes were much broader, however. The postwar period was one of frenetic, unregulated growth with the government playing no role in curbing abuses. More than any other single event, the extreme overbuilding of the nation’s railroad system laid the groundwork of the Panic and the depression that followed. Recovery was not realized until 1878.
In addition to the ruined fortunes of many Americans, there developed from the Panic of 1873 bitter antagonism between workers and the leaders of banking and manufacturing. This tension would erupt into the labor unrest that marked the following decades.
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The financial panic of 1873
The most important event of President Grant’s second term in office was the severe financial depression by which it was marked. The era of high prices and business activity which had followed the war yielded its legitimate effect in an abnormal growth of the spirit of speculation.
The inevitable consequence followed. In 1873 came a financial crash that carried ruin far and wide throughout the country. It began on October 1, in the disastrous failure of the banking firm of Jay Cooke & Co., of Philadelphia, the financiers of the Northern Pacific Railroad. Failure after failure succeeded, panic spread through the whole community, and the country was thrown into a condition resembling that of 1837, but more disastrous from the fact that much greater wealth was affected.
Years passed before business regained its normal proportions. A process of contraction set in, the natural change fron high war-prices to low peace-prices, and it was not till 1878 that the timidity of capital was fully overcome and business once more began to thrive. Industry and trade had flourished beyond precedent during the first years after the war.
The high protective tariff contributed its share to the general rush of enterprise. In 1873 railroad mileage had doubled itself since 1860, and this was a prolific cause of rash speculation. While business was expanding the currency was contracting. Paper money had depreciated, and the conditions foreboded a crash. The Jay Cooke firm stood at the head of the great banking concerns. This house had handled most of the government loans during the war, and as already stated, were financing the doubtful Northern Pacific scheme. When this firm broke, strong institutions tottered and thousands of people in every rank of life were stricken with absolute ruin or sufferings that were none the less poignant for being outside the category of direct financial failures.
The blow was felt for years in impaired credit, pressure for payment of dues, the lowering of securities and general dread of even safe enterprises. United States bonds fell from five to ten per cent. Savings were exhausted and many banks went under. Labor felt the cruel stroke for long after in the shutting down of factories and the half-time employment.
The country was in a state of alarm and disgust at the bitter consequences of questionable acts in Congress, by the Administration, and in the realm of finance, and its indignant resolve to change things for the better was expressed in the heated contest which replaced the Grant administration with that of President Hayes, in 1876.
http://www.u-s-history.com/pages/h213.html
http://www.publicbookshelf.com/public_html/The_Great_Republic_By_the_Master_Historians_Vol_III/
Dead Wild Birds in Kolkata Raise H5N1 Concerns in India
Dead Wild Birds in Kolkata Raise H5N1 Concerns in India
Recombinomics Commentary 14:56
January 18, 2008
Dead birds — crows and owls — were found in Kolkata’s southern and eastern parts today causing fresh fears as a civic team moved around the metropolis to collect bird carcasses.
The above comments on dead wild birds in Calcutta are cause for concern. Large numbers of dead crows were seen in initial video reports of H5N1 in Birbhum and media reports noted that owls and pigeons also died. Dead poultry in adjacent Murshidabad were also associated with dead wild birds, including crows and hawks, which were also linked to outbreaks in South Dinajpur.
Similarly, excess poultry deaths have been noted in multiple districts, including South 24 Parganas, which is south of Kolkata (see satellite map). Therefore, the reports of dead crows and owls in Kolkata raise concerns that H5N1 has spread along the length of the West Bengal / Bangladesh border.
Bangladesh has been reporting daily outbreaks of H5N1 including locations in southern Bangladesh, supporting extensive spread of H5N1 in both countries.
http://www.recombinomics.com/News/01180802/H5N1_Kolkata.html
U.S. economy teeters on the brink
U.S. economy teeters on the brink
Bush, Bernanke endorse $100-billion package in effort to prevent recession as housing mess hammers banks, consumers and investors
January 18, 2008
WASHINGTON — In a bid to save the world’s largest economy from recession, U.S. President George W. Bush and central bank chief Ben Bernanke yesterday endorsed a $100-billion stimulus package as the spreading housing mess continued to hammer banks, consumers and investors.
The rare plug for fiscal action comes as a growing number of economists say the United States is either in recession or perilously close to it. “The United States has now effectively entered into a serious and painful recession,” said economist Nouriel Roubini of New York University.
Prof. Roubini said all of the keys to economic health are headed in the wrong direction, including the housing market, credit availability, the job market and business spending. Add to that a run-up in oil and gas prices, and the consumer is likely to take it on the chin in 2008, he said.
Another major Wall Street investment bank acknowledged yesterday that it vastly underestimated the cost of its misadventures in the subprime mortgage market. Merrill Lynch & Co. – the world’s largest stockbroker and one of the major backers of mortgage bonds – reported the worst quarter in its history, losing $9.8-billion (U.S.) in the final three months of last year and wiping more than $16-billion worth of bad loans off its books. That raises Merrill’s housing-related losses to nearly $24-billion in 2007.
And the U.S. housing slump apparently isn’t over. Builders broke ground on new homes at an annual rate of a million homes in December – the lowest level since 1991 and a 14.2-per-cent drop from November, according to U.S. data released yesterday.
Since the start of the year, a sense of gloom has taken hold on Wall Street amid worries that the housing slump is infecting the broader economy. In the past couple of weeks alone, stocks have quickly shed virtually all of last year’s gains. Spooked by the hefty Merrill Lynch loss, investors sent the blue-chip Dow Jones industrial average down 306.95, or 2.46 per cent, to finish the day at 12,159.21.
The S&P/TSX fell 279 points, after dropping 232 points on Wednesday and 382 on Tuesday.
It is typically difficult to determine whether an economy is in recession – generally defined as two consecutive quarters of shrinking economic activity – until it’s almost over.
The latest figures show that the U.S. economy, like the Canadian economy, was still growing as 2007 ended.
A U.S. recession would have serious consequences for Canada, which sends the bulk of its exports south of the border.
Testifying before a U.S. congressional committee, Mr. Bernanke said that a proposed stimulus package of $100-billion or more would provide a “significant” and “measurable” lift to the economy.
The key, he told the House budget committee, is to put “money into the hands of households and firms in the short term” and make the measures temporary so they don’t compound the government’s already significant fiscal problems. That means giving consumers and businesses a break this year, he said.
Without endorsing any particular measure, Mr. Bernanke agreed that targeted tax cuts or spending would bolster the U.S. Federal Reserve Board’s efforts to stoke the economy with lower interest rates. The Fed has cut its key interest rate by a full percentage point since the summer, and many analysts expect another half- percentage-point reduction at the bank’s next meeting on Jan. 30.
“Fiscal action could be helpful in principle” and may provide “broader support for the economy,” he said.
Mr. Bush also agreed that the weakening economy could use a boost.
White House spokesman Tony Fratto said the President has begun talks with congressional leaders on what the plan might look like.
Economist Alec Phillips of Goldman Sachs said Mr. Bernanke’s endorsement has raised the likelihood that Congress will act soon. “There is enough momentum behind it that a deal looks more likely than not,” Mr. Phillips said.
But he cautioned that differences between Democrats and Republicans in Congress could stall or delay fiscal measures. He pointed out that Congress took four months to pass a stimulus package after the 2001 terrorist attacks.
“You know central bankers are concerned about the economy when they condone stimulative fiscal policy,” BMO Nesbitt Burns economist Michael Gregory remarked in a note to clients.
Among the measures on the table: a $600 per household tax rebate, an extension of unemployment benefits by up to 26 weeks, a targeted housing tax break, a research tax credit and an instant tax break for businesses.
Mortgage losses have left several major Wall Street brokers scrambling to shore up their finances with cash infusions from Middle Eastern and Asian investors. Merrill Lynch, for example, raised $6.6-billion this week by selling preferred shares to the Kuwait Investment Authority, a Japanese bank and other investors – part of a $40-billion Wall Street fire sale triggered by mortgage losses.
Merrill Lynch, Citibank, Bear Stearns and others were part of a once-lucrative business of packaging high-risk mortgages into bonds. But as U.S. house prices tumbled and teaser introductory interest rates expired, many borrowers stopped paying their mortgages and the value of those bonds collapsed.
The major Wall Street banks have already racked up losses of $100-billion in the subprime debacle. That’s still less than the roughly $170-billion banks lost in the savings-and-loans crisis of the 1980s, or the $2-trillion that investors lost when the technology bubble burst in 2001.
Some experts have predicted that banks could ultimately write off as much as $500-billion in investments.
The toll on household wealth, however, would be much greater. A 10-per-cent decline in house prices would wipe out $2-trillion worth of household wealth.
Earlier this week, Citigroup, the world’s largest bank, reported a $9.8-billion fourth-quarter loss. It also wrote down the value of its mortgage-related investments by $18.1-billion.
http://www.theglobeandmail.com/servlet/story/LAC.20080118.ECONOMY18/TPStory/Business/columnists
Panicked Asian investors dump stocks on US fears
Panicked Asian investors dump stocks on US fears
Agence France-Presse
01/18/2008
Close this TOKYO — Asian shares tumbled in early trading Friday as panicked investors dumped stocks after Wall Street set the lead and plummeted to fresh lows on intensifying recession fears, dealers said.
Japan’s finance minister called for calm, and markets seemed unmoved by US President George W. Bush’s plan to unveil a stimulus plan Friday following more grim economic news.
The Tokyo Stock Exchange’s benchmark Nikkei-225 index dropped 2.81 percent at the end of its morning session, putting the Tokyo market on course to close at its lowest point since October 2005.
Hong Kong share prices slumped 3.5 percent in opening trade. Losses in Shanghai, which have been seen as relatively insulated from US economic troubles, were capped on expectations of strong earnings among large Chinese banks. The benchmark Shanghai Composite Index fell 0.19 percent.
Seoul and Taipei were both down about two percent while Singapore shares slid 3.0 percent by mid-morning.
Australian stocks, already marking their worst ever start to a year, plunged about 2.6 percent shortly after opening.
“People are panicking. We are seeing a lot of unwinding of carry trades,” said Andre Clarke, sales trader at SG Securities in Hong Kong.
In Taipei, President Securities analyst Johnny Lee also reported “panic selling” after the local market opened.
“Market sentiment is overwhelmed by fear,” said Ben Kwong, chief operating officer at KGI Asia Ltd in Hong Kong.
“Investors are overly concerned about the subprime crisis, which could weaken the US economy and the global economy as well.”
US shares plummeted to fresh lows Thursday as bleak data on housing and manufacturing and a massive loss from investment and brokerage firm Merrill Lynch fanned recession fears and prompted investors to run for cover.
United States President George W. Bush scheduled an announcement Friday on “short-term, temporary measures” to stimulate an economy buffeted by housing and credit woes, a spokesman said.
Ben Bernanke, chairman of the US Federal Reserve, on Thursday backed the idea of a temporary stimulus package and talked of the need for swift action.
Bernanke indicated a stimulus effort could complement the Fed’s actions in slashing interest rates to offset the impact of economic woes that, according to some analysts, could provoke a recession.
But dealers said Bernanke’s congressional testimony failed to reassure markets and instead fanned concern about the direction of the world’s largest economy.
“I could not detect strong willingness on the part of the Fed chief to ward off a recession at a time when the economy, as seen by recent economic data, is decelerating,” said Yoshikiyo Shimamine, chief economist at Dai-Ichi Life Research Institute.
As share prices plunged, Japanese Finance Minister Fukushiro Nukaga urged markets not to over-react.
“At this stage, we shouldn’t make a knee-jerk reaction,” Nukaga told reporters, adding “there are various factors that move the markets.”
“We need to look carefully at economic indicators and observe the effects of the US subprime mortgage issue and high crude oil prices,” Nukaga said.
Subprime loans flourished at the end of a US housing boom as lenders offered mortgages to people with shaky credit. A subsequent wave of defaults left US and global banks with billions of dollars in losses, leading to tighter credit which squeezed consumer and business spending, threatening the overall economy.
Asian banks were among the losers, with HSBC sliding 3.80 Hong Kong dollars or 3.2 percent to 115 and Mizuho Financial Group down 12,000 yen or 2.5 percent to 471,000 in Tokyo.
A strengthening yen against the dollar also soured the mood in Tokyo. Japanese exporters benefit from a weak currency.
NATO hears ‘noise before defeat’
NATO hears ‘noise before defeat’
By M K Bhadrakumar
When the blame-game begins in an indeterminate war, it is time to sit up and take note. US Secretary of Defense Robert Gates’ interview with the Los Angeles Times on Wednesday rings alarm bells.
There has been no effort to claim he was misquoted. In fact, Pentagon press secretary Geoff Morrell confirmed the chief was “not backing off his fundamental criticism that NATO North Atlantic Treaty Organization needs to do a better job in training
for counter-insurgency”.
Morrell made a little concession, though, that Gates meant no offence to any particular NATO country. NATO secretary general Jaap de Hoop Scheffer responded he had the “greatest respect” for NATO forces fighting in southern Afghanistan. He advised Washington, “Combating insurgency is a complex thing, and not always easy.” At The Hague, the American ambassador was summoned and asked to “clarify”. Dutch Defense Minister Van Middlekoop publicly regretted, “This is not the Robert Gates we have come to know.” Other European politicians expressed surprise, indignation.
In NATO history there have been few such laundering of dirty linen in public view. Al-Qaeda leader Osama bin Laden and Taliban head Mullah Omar have achieved something that Soviet leaders Josef Stalin, Nikita Khrushchev and Leonid Brezhnev couldn’t.
Washington mocks NATO
Gates’ criticism was pinpointed – NATO was a lemon. He said: “I’m worried we’re deploying military advisors that are not properly trained and I’m worried we have some military forces that don’t know how to do counter-insurgency operations … Most of the European forces, NATO forces, are not trained in counter-insurgency; they were trained for the Fulda Gap NATO’s Cold War battle lines in Germany.”
Gates was giving vent to pent-up frustrations. Finally, Afghanistan is threatening to be a blemish on his successfully nurtured record in public service. On December 11, at the US Senate Armed Services Committee hearing on Afghanistan, Gates admitted somberly, “If I had to sum up the current situation in Afghanistan, I would say there is reason for optimism, but tempered by caution.”
Gates warned the NATO mission “has exposed real limitations in the way the alliance is, or organized, operated and equipped. I believe the problem arises in a large part due to the way various allies view the very nature of the alliance in the 21st century, where in a post-Cold War environment, we have to be ready to operate in distant locations against insurgencies and terrorist networks.” He solicited help from US Congressmen for “pressuring” the NATO capitals “to do the difficult work of persuading their own citizens in Europe of the need to step up to this challenge.”
Gates again spoke forcefully at the meeting of NATO defense ministers in Edinburgh, Scotland, on December 14. But “no one at the table stood up and said: ‘I agree with that’,” he later lamented.
This week, the Pentagon underscored its displeasure by making a deployment of 3,200 Marine Corps to southern Afghanistan, bringing the US presence to about 30,000 troops. The NATO force in Afghanistan numbers about 40,000, of which 14,000 are Americans. The Washington Post described the US move as one to “fill a void created in part by NATO’s inability to fight the insurgency adequately, a job the allies never signed up to do”. The majority of the marines will be directly engaged in fighting in the south alongside British, Australian, Dutch and Canadian troops, who have taken record casualties during the past year.
Of course, shadowboxing is to be expected in the run-up to the NATO summit meeting in Bucharest, Romania, in April, where Afghanistan will be a key agenda item. But that cannot explain away the unusual public discord. The reluctance on the part of major NATO powers to commit more troops to Afghanistan arises as much out of profound disagreement with Washington over the objectives of the war and the fashion in which the US spearheads the war as in deference to growing anti-war sentiment in Europe.
A general hits out
Gates’ criticism draws heavily from a recent study authored by the US general who commanded the forces in Afghanistan from October 2003 until May 2005, Lieutenant General David W Barno, in the prestigious journal Military Review. Barno is an influential voice in the US defense community. He chose to begin his paper devoted to the counter-insurgency strategy in Afghanistan, citing lines by ancient Chinese general Sun Tzu, “Strategy without tactics is the slowest road to victory. Tactics without strategy is the noise before defeat.”
Barno claimed the US counter-insurgency strategy during his period produced “positive and dramatic” results. He gave the “center of gravity” in his strategy to the Afghan people and not the “enemy”. He kept in view the Afghan people’s “immense enmity to foreign forces” and deduced that eschewing the “Soviet attempt at omnipresence” in Afghanistan, only through a “light footprint approach” instead, could the war be successfully fought.
Barno wrote that Afghan people’s tolerance for a foreign presence was “a bag of capital that was finite and had to be spent slowly and frugally” and, therefore, under his charge US forces took great care to avoid Afghan casualties, detainee abuse, or transgressions in observance of respect to tribal leaders or causing offence to traditional Afghan culture.
Second, Barno outlined that he and the then-US ambassador, Zalmay Khalilzad, bonded as a team and they had a “unity of purpose” in ensuring perfect interagency and international-level coordination. According to Barno, the slide began in mid-2005 after he and Khalilzad were reassigned. Washington then decided to publicly announce that NATO was assuming responsibility for the war and that the US was making a token withdrawal of 2,500 troops.
“Unsurprisingly, this was widely viewed in the region as the first signal that the United States was ‘moving for the exits’, thus reinforcing long-held doubts about the prospects of sustained American commitment. In my judgement, these public moves have served more than any other US actions since 2001 the fall of the Taliban to alter the calculus of both our friends and our adversaries across the region – and not in our favor.”
Barno implied NATO messed up the top-notch command structure he created. The result is, “With the advent of NATO military leadership, there is today no single comprehensive strategy to guide the US, NATO, or international effort.” Consequently, he says, the unity of purpose – both interagency and international – has suffered and unity of command is fragmented, and tactics have “seemingly reverted to earlier practices such as the aggressive use of airpower”.
Barno makes some chilling conclusions. First, he says the “bag of capital” representing the tolerance of Afghan people for foreign forces is diminishing. Second, NATO narrowly focuses on the “20% military dimension” of the war, while ignoring the 80% comprising non-military components. Third, the “center of gravity” of the war is no longer the Afghan people but the “enemy”. Fourth, President Hamid Karzai’s government is ineffectual “under growing pressure from powerful interests within his administration”. Fifth, corruption, crime, poverty and a burgeoning narcotics trade have eroded public confidence in Karzai. Finally, “NATO, the designated heir to an originally popular international effort, is threatened by the prospects of mounting disaffection among the Afghan people.”
What can be achieved?
Somewhere along the line, mud-slinging had to happen. Yet, almost everything Barno wrote could be true. Barno drew a handsome self-portrait. He whitewashes a controversial phase of the war. NATO inherited a dysfunctional war. By end-2006, it was no longer a winnable war. When the alliance’s defense ministers gathered in the Dutch seaside resort of Noordwijk last November to commemorate the first anniversary of NATO in Afghanistan, the crisis atmosphere was palpable.
There were no offers of major reinforcements by the member countries. The Dutch indicated they were close to withdrawing their 1,600-strong contingent from Uruzgan province in southern Afghanistan the coming autumn. The likely knock-on effect of the Dutch decision on countries such as Canada worried everyone present at the meeting. Germany, France, Italy and Spain insisted they were constrained by their national caveats guiding deployment of troops on non-combat roles.
The result has been a sort of “Balkanization” of Afghanistan, as Daan Everts, outgoing civilian representative of the NATO secretary general in Kabul, admitted to al-Jazeera in a recent interview. “You have a little ‘German Afghanistan’ in the north, an ‘Italian Afghanistan’ in the west, ‘Dutch Afghanistan’ in Uruzgan and a ‘Canadian Afghanistan’ in Kandahar and so on. Geographically we NATO have been fractured, but also sectorally with equal ineffectiveness – like giving the justice sector totally to the Italians, counter-narcotics to the British, the police to Germans, anti-terrorism to the Americans.”
Everts was unusually frank for a high-ranking NATO official. He said Afghan reconstruction has been a “bonanza for consultants, serious consultants, half-baked consultants, marginal consultants and mailbox consultants”; there has been an outflow of resources from Afghanistan of up to 40% of aid given to the country. “So there is this aid industry that descends on a poor nation and runs away with part of the loot.” He called for a government in Kabul that is “more serious about problems” such as corruption, drug-trafficking and law-enforcement.
In such a mess, Lord (Paddy) Ashdown of Norton-sub-Hamdon is due to arrive in Kabul shortly as the United Nations’ super envoy. Is a British colonial-style governor the right answer? Lord Ashdown – former Royal Marine commando and special forces officer, Liberal Democrat leader, member of Parliament, the European Union’s high representative in Bosnia-Herzegovina
during 2002-2006 – is a forceful personality, and was hugely successful in restoring order to the Balkan country torn apart by violence and ethnic cleansing.
But Afghanistan is notoriously untamed in history. Ashdown has sought to combine Everts’ former responsibilities with those of Tom Koenigs, the low-profile German diplomat who served as the UN’s special representative in Afghanistan. He hopes to be the main point of contact between Karzai’s government and the international forces, the European Union policing mission and the UN contingent, apart from coordinating Afghan reconstruction efforts.
That is much too much for anyone to take on. But Ashdown is gifted. Even then, the chances are the blame-game is going to accelerate. The Afghans are unlikely to accept a British viceroy – even if he wears a blue beret. Karzai’s government resents being bypassed. While in theory a “unity of purpose” and a formal link between the Afghan government and among NATO and the EU and the UN is desirable, there are problems. Some UN member countries do not want a direct relationship with NATO (or vice versa). NATO will chaff at subordination to the UN. There is no such thing as a unified EU voice. Least of all, Washington simply doesn’t know how to be self-effacing.
Reconciliation with the Taliban
But then, Ashdown’s real mission lies elsewhere, in addressing the core issue: What do we do with the Taliban? No doubt, the Taliban’s exclusion from the Bonn conference seven years ago proved to be a horrible mistake. That was also how the Afghan and Pakistan problem came to be joined at the hips.
Pakistan President Pervez Musharraf made a valid point in his interview with the German weekly magazine Der Spiegel this week when he said al-Qaeda isn’t the real problem that faces Pakistan. “I don’t deny the fact that al-Qaeda is operating here Pakistan. They are carrying out terrorism in the tribal areas; they are the masterminds behind these suicide bombings. While all of this is true, one thing is for sure: the fanatics can never take over Pakistan. This is not possible. They are militarily not so strong they can defeat our army, with its 500,000 soldiers, nor politically – and they do not stand a chance of winning the elections. They are much too weak for that,” Musharraf said.
The heart of the matter is Pashtun alienation. The Taliban represent Pashtun aspirations. As long as Pashtuns are denied their historical role in Kabul, Afghanistan cannot be stabilized and Pakistan will remain in turmoil. Musharraf said, “There should be a change of strategy right away. You NATO should make political overtures to win the Pashtuns over.”
This may also be the raison d’etre of UN secretary general Ban Ki-moon’s intriguing choice of a Briton as his new special representative. Conceivably, the inscrutable Ban has been told by Washington that Ashdown is just the right man to walk on an upcoming secretive bridge, which will intricately connect New York, Washington, London, Riyadh, Islamabad and Kabul.
The point is, Britain grasps the Pashtun problem. Britain realizes that the induction of US special forces into the Pakistani tribal areas, or the custodianship of Pakistan’s nuclear stockpile, or an al-Qaeda takeover in Pakistan isn’t quite the issue today.
That is why Musharraf’s four-day visit to London starting on January 25 assumes critical importance. British mediation in Pakistani politics may already be working. Former prime minister Nawaz Sharif has begun calibrating his stance.
Reconciliation between Musharraf and the Sharif brothers is in the cards. Shahbaz Sharif will be on call in London during Musharraf’s stay there. If the reconciliation – thanks to British (and Saudi) mediation – leads to the formation of a national government in Pakistan, a leadership role for Nawaz Sharif may ensue and Pakistani politics may gain traction. Nawaz Sharif is the only politician today with the credentials and stature to mount the dangerous platform of Islamist nationalism and reach out to the Taliban and its followers inside Pakistan. The Sharif brothers could be invaluable allies for the Pakistani military – and for NATO – at this juncture.
Barno sidesteps the ground realities. The US strategy’s real failure happened, in fact, in the 2003-2005 period when he was in charge of the war. Of course, the failure was not at the military level, but at the political and diplomatic level. That was a crucial phase when the window of opportunity was still open for a course correction over the Taliban’s exclusion from the Afghan political process. The Taliban should have been invited to come in from the cold and join an intra-Afghan dialogue and reconciliation. The extreme emotions of 2001 had by then begun to ebb away.
On the contrary, Khalilzad’s diplomatic brief was that the US presidential election of 2004 was the priority for the White House. The “war on terror” in Afghanistan was a milch cow in US domestic politics. Presidential advisor Karl Rove and Vice President Dick Cheney shrewdly calculated that an enemy in the Hindu Kush was useful for the Republican Party campaign, while resonance of the booming guns in Afghanistan would be a good backdrop for election rhetoric against a decorated war veteran like John Kerry.
And, showcasing of Karzai in Kabul’s presidential palace helped display Afghanistan as a success story. A victorious Karzai indeed landed in the US to a hero’s welcome from George W Bush on election eve. Bush went on to win a second term, but the Afghan war was lost. The slide began by mid-2005 as the embittered Taliban began regrouping. As the year progressed, as Everts and many others pointed out, the Iraq war “sucked the oxygen away from Afghanistan”. How could Gates possibly admit all that? He would rather NATO take the blame. But then, it is a sideshow in actuality.
Britain is now called on to salvage the Afghan war. NATO at best will be a sleeping partner. The Hindu Kush is all set to be Lord Ashdown’s theater. He represents the UN; the White House reposes confidence in him; he takes counseling and directions from London, which coordinates with Riyadh and Islamabad – and then, gingerly, he sets out, searching for the Taliban. Incidentally, among his many attributes, Lord Ashdown is a gifted polyglot who speaks fluent Mandarin Chinese and other languages. Maybe he already speaks Pashto.
The Internet must die
The Internet must die
By: Warren Pease
on: 19.01.2008
The Internet must die
By Warren Pease
“I hear there’s rumors on the Internets that we’re going to have a draft.” — George W. Bush, contemplating his next cold Lone Star, October 8, 2004, St. Louis, Mo
You know that you’ve reached desperate times when you find yourself fondly remembering Tass and Pravda as beacons of journalistic integrity.
But when considering US corporate media’s seven-year love affair with the Bush administration and its willingness to deliver blatant propaganda and outright lies to manufacture Bush-approved political orthodoxy, those former USSR institutions compare favorably with the shameless house organs now masquerading as an American free press.
The Internet’s corporate competition: co-opted beyond redemption
Thanks to a 30-year frenzy of mergers and acquisitions, wink-and-nod FCC “oversight” and congressional unwillingness to invoke existing anti-trust laws, the American marketplace of ideas is now ruled by six massive conglomerates that control the content of more than 80 percent of what most of us see, hear and read.
So what? Well, for one thing, a significant majority of news, entertainment and information US audiences see is vetted for its support of status quo corporate values and purged of “dangerous” unconventional narratives — perhaps regarding the threat to independent thought posed by media consolidation.
And when discussing media consolidation, someone might tumble to the fact that NBC is owned by General Electric, one of the world’s largest armaments manufacturers in 2006 and among the six largest media conglomerates. GE makes and maintains engines for the F-16 Fighter jet, Abrams tank, Apache helicopter, U2 bomber, Unmanned Combat Air Vehicle (UCAV), A-10 aircraft and numerous other military equipment, including planes, helicopters, tanks and more.
Is it reasonable to expect NBC to report critically on the status and duration of the Iraq occupation? Or is it predictable that NBC’s occupation coverage will tell us that the “surge” is working, that US troop deaths are down, that the Iraqi puppet regime is gaining traction and, if we can hang on for another decade, things should turn out hunky-dory.
Well, it’s certain that extending the US presence in Iraq by a decade will have a very positive impact on GE’s profit and loss statements. It’s probably going to be somewhat less beneficial for the people who actually have to fight this insane proxy war on behalf of GE’s bottom line.
But that’s okay, since war is the optimum business condition for many industries — banks, weapons makers, raw materials suppliers, machine tool makers and so on — GE looks to sell many billions of dollars more of its killing machinery, all the while telling Americans via NBC how peace is just 10 or so years down the road.
And GE is just one of the main offenders. We’ll leave for another day a discussion on how thoroughly Rupert Murdoch’s News Corp. has polluted the national discourse. Or how the acquisitive tentacles of Viacom, CBS, TimeWarner and Disney have managed to take a relatively engaged population and, in 30 short years, turn it into a nation of compliant, ill-informed, politically illiterate chowder heads content to consume their quota of goods, services and ideologies with an equally uncritical eye.
American mass media lost the thread of the story decades ago and are now only qualified to dish pop culture infotainment masquerading as news; report breathlessly on the latest D-class celebrity screw-up; and act as stenographers and cheerleaders for the latest batch of official Bush administration lies.
Among other insults, this explains why John Stossel is a network star while Bill Moyers is on PBS.
The parallel universe
The only serious competition threatening corporate media’s monopoly on official “truths” — those pieties designed to narrow acceptable choices and increase social control — comes from the Internet.
“The news,” as it’s laughingly known, can tap into a seemingly endless supply of drunken or felonious fools like Jessica and Paris and OJ and Twitany to sedate its viewers. Then there’s the occasional gruesome murder to balance the chirpy happy talk on miraculous medical procedures (which most of us will never live to experience because our for-profit insurers won’t cover them), an always erroneous look at local weather, followed by 15 uplifting minutes on sports and a recap of the top celebrity screw-ups of the day. The viewer yawns, feels a bit over-awed by all this technical wizardry and slick showmanship, and heads for bed thinking he’s up to date on the stuff that really matters.
Corporate media has a bottomless pool of “on-air talent” — perfectly coiffed, well-modulated, tastefully made up, arrayed in $5K worth of suits, ties and little flag lapel pins, strident and irritating as a hundred Ross Perots.
We have broadband, YouTube, blogs, forums, actual reporters, search engines, discussion groups, political organizing, access to newspapers published in actual free countries — all taking place in plain sight.
Over the past decade Internet and Web technology have matured and surpassed nearly anything mass media can offer. It’s instant news, usually with audio or video, often reported by eyewitnesses rather than filtered by some blow-dried idiot. It’s preserving what’s left of our national heritage by archiving “purged” documents. It’s subjecting every significant political, social and economic development to the scrutiny and analysis of the world’s collective brainpower. It’s the unifying element linking diverse cultures into an evolving planetary society not subordinated to states or lines on a map. And it’s the universe’s greatest source of jokes, one-liners and satire.
Governments’ worst nightmare: an informed and activist citizenry
I don’t see how the power elites can afford to allow this nonsense to continue for much longer. People with unconventional (read: humanitarian or peaceful) ideas are the implacable enemy of those sustaining their wealth and power by aligning themselves with the status quo, and these dissenting Internet pipsqueaks cannot be tolerated forever.
To our corporate masters, libraries, independent publishers and bookstores are bad enough. But fortunately for “them,” libraries are underfunded and ill-attended, it’s getting harder to publish dissenting material in the US and many independent book stores are getting killed by the Barnes & Nobles and Amazons of the world.
Not so the Internet. It’s become the alternate universe for hundreds of millions of people worldwide who know and understand that the official story is always and inevitably suspect. That altruism has never been a function of governments. That governments are always at war with “the people” they pretend to watch out for. That, as The Commander Guy pointed out in a rare moment of clarity, dictatorships ARE easier to run than representative democracies. That power exists solely to perpetuate itself and, when threatened, will defend its position with anything and everything in the arsenal.
Now that’s a hell of an alternate narrative. And the Internet is the “plumbing” that carries these contrarian messages — and the seditious thoughts and attitudes and movements they inspire — around the world in less time than it takes Murdoch to count his latest billion.
Death by harassment
In July of last year, Bush signed an executive order, entitled “Blocking Property of Certain Persons Who Threaten Stabilization Efforts in Iraq. This expanded the administration’s flexible definition of a terrorist to include anyone disagreeing with its ” . . . efforts to promote economic reconstruction and political reform in Iraq or to provide humanitarian assistance to the Iraqi people.” This apparently isn’t intended as a joke, although I’m not sure what’s going on over there qualifies as “economic reconstruction” or “humanitarian assistance.”
Which brings us to “Endgame,” as the Department of Homeland Security calls HR 1955/S 1959, known officially as The Violent Radicalization and Homegrown Terrorism Prevention Act of 2007, and which contains — among dozens of disgusting provisions — these gems italics mine:
(2) The promotion of violent radicalization, homegrown terrorism and ideologically based violence exists in the United States and poses a threat to homeland security.
(3) The Internet has aided in facilitating violent radicalization, ideologically based violence, and the homegrown terrorism process in the United States by providing access to broad and constant streams of terrorist-related propaganda to United States citizens.
Striking at the heart of the international terrorist conspiracy, this bill targets the dangerous arch-fiends/grandmothers/MySpace teens who participate on the hundreds of thousands of political forums, blogs or news and information sites that aren’t exclusively devoted to singing the praises of Bush/Cheney and their merry band of imperialist oil pirates.
Note that this piece of repressive legislation — rumored to be the brainchild of the Rand Corporation and introduced by Democrat Jane Harman — passed the House last October by a 404-6 margin. Note that, introduced last August in the upper house as S 1959 and co-sponsored by GOP armchair warrior and domestic repression enthusiast Norm Coleman, it’s coming up for a vote in the Senate early this year. If it passes, which seems likely, a Bush signature is a given — probably with a signing statement that says he’ll ignore the act’s few feeble provisions to combat totalitarianism, like this one:
(a) In General – The Department of Homeland Security’s efforts to prevent ideologically based violence and homegrown terrorism as described herein shall not violate the constitutional rights, civil rights, or civil liberties of United States citizens or lawful permanent residents.
Readers may want to take appropriate preemptive action before, say, downloading this article becomes a felony.
Another motive for digital murder
There’s an interesting new site called “Wikileaks” that has garnered some recent attention from corporate mass media, notably Time Magazine, which notes that Wikileaks ” . . . could become as important a journalistic tool as the Freedom of Information Act.” The site is intended as a secure repository where whistleblowers can, at minimal personal risk, post confidential, potentially embarrassing government and corporate documents for the entire online world to see, study and analyze.
Here’s part of Wikileaks’ mission statement:
We propose that authoritarian governments, oppressive institutions and corrupt corporations should be subject to the pressure, not merely of international diplomacy, freedom of information laws or even periodic elections, but of something far stronger — the consciences of the people within them.
We believe that transparency in government activities leads to reduced corruption, better government and stronger democracies . . . We believe this scrutiny requires information. Historically that information has been costly – in terms of human life and human rights. But with technological advances to the Internet and cryptography, the risks of conveying important information can be lowered.
Wikileaks opens leaked documents up to stronger scrutiny than any media organization or intelligence agency can provide. Wikileaks provides a forum for the entire global community to relentlessly examine any document for its credibility, plausibility, veracity and validity. Communities can interpret leaked documents and explain their relevance to the public. If a document comes from the Chinese government, the entire Chinese dissident community and diaspora can freely scrutinize and discuss it; if a document arrives from Iran, the entire Farsi community can analyze it and put it in context.
In an important sense, Wikileaks is the first intelligence agency of the people . . . its only interest is the revelation of the truth. Unlike the covert activities of state intelligence agencies, Wikileaks relies upon the power of overt fact to enable and empower citizens to bring feared and corrupt governments and corporations to justice.
Wikileaks is still months from going fully operational, but they’ve already put up quite a few leaked confidential documents from all over the world. Here’s one entitled “Fallujah, the information war and U.S. propaganda.”
I suppose the whole thing could be a slick disinfo psy-op designed to leak phony documents to “non-embedded” reporters, then embarrass them publicly for printing anti-US propaganda fabricated by some obscure left-radical loon or “terrorist.”
But only a pure pessimist would think the Bush administration capable of such chicanery. On the contrary, they’ve amassed an impressive record of unstinting support for the organizing principles of this country . . . life, liberty and happiness for those with the right pedigree and who can kick in a million bucks or so to the Republican National Committee each election cycle.
You can contact the author at war_on_peas@yahoo.com while the Internet is still up and running.
Also, if you value your opinions and the right to express them openly over the Internet, please call your senators and urge them to vote against S 1959. Then, if you really enjoy smashing your head into the wall, notify the media of your dissatisfaction with their complete blackout on HR 1955 and S 1959.
Authors Bio: Warren Pease is my own personal wholly-owned digital subsidiary. He only exists within the broadband spectrum of the public airwaves. Don’t be fooled by cheap imitations. Beware of others, living or dead, using that name.
