Money, Military and Madness . . . .

Currently I'm reading and just about to finish The Sorrows of EMPIRE – Militarism, Secrecy, and the End of the Republic by Chalmers Johnson.

It's a great book with a look at US militarism and global monetary manipulation and their repercussions both at home and abroad. The author's explanation and history of the Pentagon's influence on US government policies is eye-opening for the those not familiar in the ways of Washington. Written in 2004, some of his references are uncanny in their relevance today.

Some excerpts follow as a teaser for you:

After the 1992 election, Cheney left the Defense Department, and between 1995 and 2000 he was the chief executive officer of Halliburton. Under his leadership, Brown & Root took in $2.3 billion in government contracts, almost double the $1.2 billion it earned from the government in the five years before Cheney arrived. Halliburton rebuilt Saddam Hussein's war-damaged oil fields for some $23.8 million, even though Cheney, secretary of defense during the first Gulf War, had been instrumental in destroying them. By 1999, Halliburton had become the biggest nonunion employer in the United States, although Wal-Mart soon replaced it. Cheney also appointed Dave Gibben, his chief of staff when he was at the Pentagon, as one of Halliburton's leading lobbyists. In 2001, Cheney returned to Washington as vice president, and Brown & Root continued to build, maintain, and protect bases from Central Asia to the Persian Gulf.

During Cheney's term as Halliburton's CEO, the company advanced from seventy-third to eighteenth on the Pentagon's list of top contractors. Its number of subsidiaries located in offshore tax havens also increased from nine to forty-four. As a result, Halliburton went from paying $302 million in company taxes in 1998 to getting an $85 million tax refund in 1999.

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In other words, feed at the taxpayer's trough, but never replenish it. Perish the thought, that would be un-American! “Profit=Good, Taxes=Bad” . . . .

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Dick Cheney, Bush Senior's secretary of defense and Bush Junior's vice president, helped broker the deal, while out of office, between Chevron and Kazakhstan as a member of Kazakhstan's Oil Advisory Board. James A. Baker III, former secretary of state, mastermind of the scheme to get the Supreme Court to appoint bush Junior president in 2001, and senior partner of the Houston and Washington law firm of Baker Botts, had a hand in the negotiations. Baker's firm maintains an office in Baku staffed by five attorneys. He is a member of the U.S.-Azerbaijan Chamber of Commerce's advisory council, as is Cheney. During the 1990s the council's cochairman was Richard Armitage, a veteran administrator of the American-sponsored anti-Soviet war in Afghanistan during the 1980s and undersecretary of state in the second Bush administration. Brent Scowcroft, Rice's boss and mentor when he was Bush Senior's national security adviser, is a member of the board of Pennzoil, an active investor in the Caspian Sea oil consortia.

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Is anyone else seeing a pattern here? High government positions and multi-national contracts. Who woulda thunk it ? ? ? ?

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Clinton camouflaged his policies by carrying them out under the banner of “globalization.” this proved quite effective in maneuvering rich but gullible nations to do America's bidding – for example, Argentina – or in destabilizing potential rivals – for example, South Korea and Indonesia in the 1997 economic crisis – or in protecting domestic economic interests – for example, in maintaining the exorbitant prices of American pharmaceutical companies under cover of defending “intellectual property rights.” During the 1990s, the rationales of free trade and capitalist economics were used to disguise America's hegemonic power and make it seem benign or, at least, natural and unavoidable. The main agents of this imperialism were Clinton's secretary of the Treasury, Robert Rubin, and his deputy (today, president of Harvard University), Lawrence Summers. The United States ruled the world but did so in a carefully masked way that produced high degrees of acquiescence among the dominated nations.

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Now where have we heard those last two names? Oh yeah, I know: Rubin was also a former Goldman Sachs and Citigroup big wheel and advisor to the current US president on the economic crisis, and Summers is actually a member of the current administration. Great how this is working out so far . . . .

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Starting in approximately 1981, the United States introduced, under the cover of globalization, a new strategy intended to accomplish two major goals: first, to discredit state-assisted capitalism like Japan's and prevent its spread to any countries other than the East Asian NICs, which had already industrialized by following the Japanese model; and second, to weaken the sovereignty of Third world nations so that they would become even more dependent on the largesse of the advanced capitalist nations and unable to organize themselves as a power bloc to negotiate equitable with the rich countries.

The United States's chosen instruments for putting this strategy into effect were the World Bank and the International Monetary Fund (IMF). Like the General Agreement on Tariffs and Trade, the World Bank and the IMF were created after World War II to manage the international economy and prevent a recurrence of the beggar-thy-neighbor policies of the 1930s. What has to be understood is that both the fund and the bank are actually surrogates for the U.S. Treasury. They are both located at 19^th and H Streets, Northwest, in Washington, DC, and their voting rules ensure that they can do nothing without the approval of the secretary of the Treasury. The political scientist Thomas Ferguson compares the IMF to the famous dog in the RCA advertisements listening to “his master's voice” - the Treasury – on a Victrola.

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Appears to be a bit incestuous, don't you think? Probably not too much of a problem, though. These guys are trustworthy, or they wouldn't be in these positions, right ? ? ? ?

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Thus was born the weird phenomenon of “moral hazard,” meaning American bankers could make outrageously irresponsible loans without any risk of having to absorb the loss or make good the money they had mismanaged. Before it was over, the 1970s loan bonanza produced a disaster of exactly the sort Keynes and the reformers at the end of World War II had sought to avoid. Virtually every country in Africa and Latin America was deeply in debt. In August 1982, Jesus Silva Herzog, the Mexican minister of finance, announced that his country was bankrupt and would no longer be able to pay interest on any of its loans. Just as the bankers had assumed, the U.S. Government stepped in – not to save Mexico but to ensure that American banks did not collapse. At no time, then or later, did our government suggest that the people who made the bad loans bore some responsibility for the results.

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Well, golly gee whiz. Where have we heard that tune before? Perhaps during the end of the bush regime and now at the beginning of the new one? One would think that learning by past mistakes would be a no-brainer, but I guess not . . . .

(Remember this book was written in 2004, not 2009.)

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The United States was the architect of and main profiteer from these efforts. From 1991 to 1993, Lawrence Summers was the chief economist at the World Bank and the man who oversaw the tailoring of “austerity measures” to each country that needed a loan. He decided exactly what a country had that Washington wanted to open up. On December 12, 1991, Summers became notorious for a leaked memo to senior officials of the bank encouraging polluting industries in the rich nations to relocate to the less developed countries. He wrote, “I think the economic logic behind dumping a load of toxic waste in the lowest wage countries is impeccable and we should face up to that.” Brazil's secretary of environment, Jose Lutzenburger replied, “The best thing that could happen would be for the Bank to disappear.”

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There's that Summers guy's name again. What's he doing nowadays? Oh yeah, he's currently the Director of the White House's National Economic Council. This oughta work out just great . . . .

As my friends hear me say on a semi-regular basis:

“We're doomed! Doomed!”

Get the book or check it out at your local library like I did.

Tell your friends . . . .

(Cross-posted from Moved to Vancouver)

Summit of the Americas : On not getting "all bogged down in ideological diatribes"

Prior to the Summit-of-the-Americas-of-34-countries-minus-Cuba, Steve said he wasn't sure if he'd want to see another one take place, "because they tended to get all bogged down in ideological diatribes" :

"There are some countries that want to keep fighting the Cold War and frankly wars that go a lot farther back than that."

Like the United Fruit Company?
After urging a thaw in U.S.-Cuba relations, he said :

"… we don't turn a blind eye to the fact that Cuba is a communist dictatorship and that we want to see progress on freedom, democracy and human rights as well as on economic matters."

Indeed, ALBA - the trade group comprised of Venezuela, Nicaragua, Bolivia, Honduras, Cuba, Dominica and Saint Vincent and the Grenadines - had a few points of its own to make about progress, freedom, democracy and human rights, including the embargo of Cuba.
ALBA has said it will not sign the Summit Declaration until they are addressed.
Excerpted :

• Capitalism has provoked an ecological crisis by subordinating the necessary conditions for life on this planet to the dominance of the market and profit.

• We question the G20’s decision to triple the amount of resources going to the International Monetary Fund, when what is really necessary is the establishment of a new world economic order that includes the total transformation of the IMF, the World Bank and the WTO [World Trade Organisation], which with their neoliberal conditions have contributed to this global economic crisis.

• We condemn discrimination against migrants in all its forms. Migration is a human right, not a crime.

• The solutions to the energy, food and climate change crises have to be integral and interdependent. We cannot resolve a problem by creating others in the areas fundamental to life. For example, generalising the use of agro-fuels can only impact negatively on the price of food and in the utilisation of essential resources such as water, land and forests.

• Basic services such as education, health, water, energy and telecommunications have to be declared human rights and cannot be the objects of private business nor be commodified by the World Trade Organisation. These services are and should be essential, universally accessible public services.

• [E]liminate interventionist practices such as covert operations, parallel diplomacy, media wars aimed at destabilising states and governments, and the financing of destabilising groups. It is fundamental that we construct a world in which a diversity of economic, political, social and cultural approaches are recognised and respected.

• The legitimate struggle against narco-trafficking and organised crime, and any other manifestation of the denominated “new threats,” should not be utilised as excuses for carrying out acts of interference or intervention against our countries.

Hugo Chavez presented Obama with a book : "Open Veins of Latin America: Five Centuries of the Pillage of a Continent" and suggested that the next Summit of the Americas be held in Cuba.

Ecuadorean President Rafael Correa described the summit declaration as "light" in that it "does not reflect the economic crisis we are experiencing, which is not a temporary crisis but a crisis of the capitalist system, and that the document suggests solutions by legitimising those responsible for the crisis, for instance, the International Monetary Fund."

I found their declaration of dissent on a website in Australia.
I really think space for some small mention of these entirely reasonable views from over a fifth of the participating summit countries could have been found somewhere within our own rhapsodic media accounts of Steve spending 15 minutes in a hotel kitchen service corridor with Obama.

Cross-posted at Creekside

Begone, Bungling Bankers . . . .

What is it with these international banking fund guys, anyway? It wasn't that long ago that we had the wolfowitz/World Bank incident and now this by way of Reuters:

Probe clears IMF chief of abuse of power
Sat Oct 25, 2008 8:11pm EDT - By Lesley Wroughton


WASHINGTON (Reuters) - The International Monetary Fund's board on Saturday cleared Managing Director Dominique Strauss-Kahn of harassment, favoritism and abuse of power following an inquiry into his affair with a subordinate.

While the board stopped short of any type of disciplinary action, its leader, Shakour Shaalan, acknowledged there was concern among female staff about Strauss-Kahn's behavior.

Shaalan said he had warned Strauss-Kahn, a former French finance minister, against any further improper conduct.

"The executive board noted that the incident was regrettable and reflected a serious error of judgment on the part of the managing director," the IMF's board of member countries said in a statement.

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The investigation by an outside lawyer into allegations of improper conduct by Strauss-Kahn found that his affair with Piroska Nagy, who worked in the IMF's Africa department as a senior economist until taking a buyout in August, had been consensual.

"I very much regret the incident and I accept responsibility for it," said Strauss-Kahn who is married to French television personality Anne Sinclair.

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The board sought to deal with the investigation quickly so as not to distract the IMF from its role in dealing with the global financial crisis that has sent markets plunging on fears that the world economy is in for a long and deep recession.

Shaalan told a conference call with reporters that Strauss-Kahn still had the confidence of the board.

"Our conclusion was that this will in no way affect the effectiveness of the managing director in the very challenging and difficult period ahead," said Shaalan, who represents Egypt and other Arab countries on the board.

"This was an unfortunate incident where he expressed his regrets and the board has accepted his apologies," he said, adding, "I personally spoke to him after the meeting and informed him this should not happen again."

Well, isn't that just great? A little slap on the wrist, and all is well again.

Now, on to ruling over the nations of the world banking systems like nothing's happened. These are the guys we are supposed to entrust with major international financial decisions? Get real.

This crew is so damn out of touch with reality. Betcha they had their fingers in the sub-prime loan mess, derivatives and credit swaps if truth be told.

What a crock . . . .

(Cross-posted from Moved to Vancouver)

Wolfie's Baacckkkk . . . .

This oughta make your day: (Compliments of Newsweek)

An Old Face Resurfaces


The Bush administration has offered the former World Bank president a new public service position.

By Michael Isikoff | NEWSWEEK - Dec 10, 2007 Issue


Don't ever say the Bush administration doesn't take care of its own. Nearly three years after Paul Wolfowitz resigned as deputy Defense secretary and six months after his stormy departure as president of the World Bank—amid allegations that he improperly awarded a raise to his girlfriend—he's in line to return to public service. Secretary of State Condoleezza Rice has offered Wolfowitz, a prime architect of the Iraq War, a position as chairman of the International Security Advisory Board, a prestigious State Department panel, according to two department sources who declined to be identified discussing personnel matters. The 18-member panel, which has access to highly classified intelligence, advises Rice on disarmament, nuclear proliferation, WMD issues and other matters. "We think he is well suited and will do an excellent job," said one senior official.

And in case you're wondering:

The sources said Wolfowitz has already accepted Rice's offer to fill the part-time position, though it won't be announced until the completion of a standard check for conflicts of interest. But he won't have to worry about any complaints from pesky Democrats. The position doesn't require Senate confirmation. (Emphasis mine.)

Of course, we all knew he wouldn't just fade away into the night, didn't we? As a matter of fact after his debacle at the World Bank, he found a cushy position at The American Enterprise Institute: the bastion of US conservative policy. The more things change . . . .

(Cross-posted from Moving to Vancouver)

Free fertilizer better for crops than free market ideology. Who knew?

New York Times :

"Malawi hovered for years at the brink of famine. After a disastrous corn harvest in 2005, almost five million of its 13 million people needed emergency food aid.
But this year, a nation that has perennially extended a begging bowl to the world is instead feeding its hungry neighbors. It is selling more corn to the World Food Program of the United Nations than any other country in southern Africa and is exporting hundreds of thousands of tons of corn to Zimbabwe."

Additionally three tons of stock-piled powdered milk was sent on to Uganda instead.

So how was this economic miracle achieved?

By doing what the west does, not what it preaches :

Farmers used fertilizer instead of free market ideology on their crops.

"Over the past 20 years, the World bank and some rich nations Malawi depends on for aid have periodically pressed this small, landlocked country to adhere to free market policies and cut back or eliminate fertilizer subsidies, even as the United States and Europe extensively subsidized their own farmers.

Malawi’s leaders have long favored fertilizer subsidies, but they reluctantly acceded to donor prescriptions, often shaped by foreign-aid fashions in Washington, that featured a faith in private markets and an antipathy to government intervention.
In the 1980s and again in the 1990s, the World Bank pushed Malawi to eliminate fertilizer subsidies entirely. Its theory both times was that Malawi’s farmers should shift to growing cash crops for export and use the foreign exchange earnings to import food, according to Jane Harrigan, an
economist at the University of London.

The United States, which has shipped $147 million worth of American food to Malawi as emergency relief since 2002, but only $53 million to help Malawi grow its own food, has not provided any financial support for the subsidy program, except for helping pay for the evaluation of it. Over the years, the United States Agency for International Development has focused on promoting the role of the private sector in delivering fertilizer and seed, and saw subsidies as undermining that effort."

But after the disastrous 2005 harvest, Malawi’s newly elected president implemented a policy of government subsidies for seed and fertilizer.

Last year, half the country’s farming families received coupons to buy two 110-pound bags of fertilizer for around for around $15, or about a third the market price, along with enough seed to plant less than half an acre.

As a consequence, farmers were able to double or triple their food crops, resulting in lower food prices and higher wages for farm workers. The government will also give farmers a direct say in the distribution of this year's subsidies.

Simple really. Crops thrive much better on fertilizer than they do on colonialist free market bullshit.

Wolfowitz, got laid but lost his job

Paul Wolfowitz, war-fighting genius and comb-licker, (I said comb... get your mind back on the page), is looking for work.

World Bank President Paul D. Wolfowitz resigned this afternoon, effective June 30, giving in to overwhelming pressure from bank staff and governments around the globe that he depart to end the ethics controversy that has consumed the institution.

Wolfowitz agreed to resign in negotiations with the bank's executive board, pre-empting a growing likelihood that he would have been formally reprimanded or fired, said bank officials who spoke on condition they not be named, citing the political sensitivity of the proceedings.

His resignation came as key members of the bank's 24-member executive board were mobilizing to push through a resolution expressing no-confidence in his leadership, a step that would have made it effectively impossible for him to continue, senior bank and Bush administration officials said.

The bank's board was moving toward that unprecedented step after a committee report that found that Wolfowitz broke ethics rules and undermined the reputation of the institution when he directed staff to award a substantial raise to his girlfriend and then covered up the details.

Wolfowitz, had to "negotiate" this departure, along the same lines the way a Cosa Nostra torpedo negotiates a late payment from a "client".

But in agreeing to leave, Wolfowitz extracted a significant measure of exoneration -- his key demand in the negotiations. Sources said the board will soon issue a statement ascribing to the bank some of the blame for the ethics controversy while acknowledging that Wolfowitz believes he acted ethically.

Extracted? No, no, no. That's extorted.

Here is the World Bank press release.

Over the last three days we have considered carefully the report of the ad hoc group, the associated documents, and the submissions and presentations of Mr. Wolfowitz. Our deliberations were greatly assisted by our discussion with Mr Wolfowitz. He assured us that he acted ethically and in good faith in what he believed were the best interests of the institution, and we accept that. We also accept that others involved acted ethically and in good faith. At the same time, it is clear from this material that a number of mistakes were made by a number of individuals in handling the matter under consideration, and that the Bank’s systems did not prove robust to the strain under which they were placed. One conclusion we draw from this is the need to review the governance framework of the World Bank Group, including the role as well as procedural and other aspects of the Ethics Committee. The Executive Directors accept Mr. Wolfowitz’s decision to resign as President of the World Bank Group, effective end of the fiscal year (June 30, 2007). The Board will start the nomination process for a new President immediately.

That was the negotiated stuff. Notice all the great ethics being tossed around. Everyone acted ethically. That's why people get fired. Too much ethics.

Wolfowitz responded to the World Bank statement by the Executive Directors. It was filled with the usual stuff from someone who is claiming they left to spend more time with the kids, although in his case, I suppose he'll be working on getting as much out of his "relationship" as possible. Unless Shaha Riza doesn't get naked for unemployed war geniuses. In any case, the stuff Wolfowitz said in his response is about as useful as his original timeline for the invasion of Iraq.

Now, Wolfowitz will become some kind of think tank pundit, or maybe even find a faculty position at some university. Stranger things have happened.

H/T liberal catnip

Arrogant Prick

Paul Wolfowitz, architect of the Iraq war, president of the World Bank, (after being appointed by George W Bush) and general all around slimebag has refused to resign from his position according to his lawyer.

World Bank President Paul Wolfowitz will not resign under the current "cloud" and would rather push the matter to a vote of the bank's board to clear his name, his lawyer said on Wednesday.

"Mr. Wolfowitz will not resign under this cloud and he will rather put this matter to a full vote," Wolfowitz's lawyer, Robert Bennett, told Reuters.

The "cloud" Wolfowitz doesn't like being under and cannot seem to grasp is that he played favourites with his pelvic affiliate.

OK. Let's have the right-wingers start spouting the atmosphere of entitlement line. I've got the example right here.

So, it goes to a full vote. The Europeans have had their fill of this turkey. Hopefully Wolfowitz's next job won't involve any more responsibility than asking, "Would you like anything to drink with your McMeal?"

Harper's corruption fighting government supports Wolfowitz

The fur ball surrounding Paul Wolfowitz and his personal involvement in getting his pelvic affiliate, Shaha Ali Riza, a whopping pay raise and a transfer out of the World Bank to the US State Department was reviewed by a special committee of the World Bank. They submitted their findings to Wolfowitz on Sunday, finding he did indeed do wrong and called for his resignation.

The president of the World Bank is traditionally appointed by the United States. That long standing arrangement is being put to the test by the European block at the World Bank.

European officials had previously indicated that they wanted to end the tradition of the United States picking the World Bank leader. But now the officials are hoping to enlist American help in persuading Mr. Wolfowitz to resign voluntarily, rather than be rebuked or ousted.

The goal, they said, is to avert a public rupture of the bank board over a vote, possibly later this week, to sanction Mr. Wolfowitz. Even if the vote is a reprimand, they said, it could effectively make it impossible for him to stay on.

The Europeans worked to arrange a quick exit for Mr. Wolfowitz as a special bank committee concluded that he was guilty of breaking rules barring conflicts of interest in arranging for a pay raise and promotion for Shaha Ali Riza, his companion and a bank employee, in 2005.

Basically, what the Europeans are saying is, Wolfowitz goes voluntarily or we will vote to have him removed. And the Europeans have enough weight to pull it off.

The United States has 16.4 percent of the voting share at the 24-member World Bank board that chooses the president. Europeans have twice that share if they stick together, which many bank officials say they have signaled they are willing to do to remove Mr. Wolfowitz.

There is hesitation among the Europeans at creating too much of a rift with the United States on the issue and while many would like to avoid confrontation with the United States, the European Parliament voted last month to have Wolfowitz removed.

The World Bank assumed some responsibility for not making the ethics of Wolfowitz's decision clear to him. However, the corruption is undeniable and Wolfowitz bears the majority of the responsibility according to the report.

So, one would expect that any government which provides a representative to the World Bank would be voting to remove Wolfowitz should he refuse to resign voluntarily. Of course, the US would vote to retain him since the Bush administration has been standing by him throughout this scandal and appointed him amidst a furor of protest from dozens of countries. That can be dismissed as a patently corrupt regime supporting one its corrupt operators.

You have to go down to the last paragraph of the New York Times article to get the full effect. Besides the United States supporting the retention of Wolfowitz, there are two other countries who would vote in favour of keeping Wolfowitz in his chair.

Bank officials say that, as of now, only the United States, Japan and Canada would vote in favor of Mr. Wolfowitz. They represent less than 30 percent of the voting shares.

WHAT?!!!

So, the board of the World Bank issues a finding directly to Wolfowitz which boils down to explaining that he's a corrupt sonofabitch and Canada, instead of accepting the majority view of the board of that world body, intends to support the corrupt appointee of a corrupt regime.

And, just in case you were wondering, the marching orders for the Canadian member of the board on the World Bank come from the minister of finance, Jim Flaherty and the Prime Minister's Office.

These guys aren't even trying to hide it anymore.

Wolfowitz wants to attack corruption. Unless he's getting laid. Then it's OK.

Paul Wolfowitz, architect of The War Without End™ and now president of the World Bank has a little ethics problem. He publicly apologized for being such an overtly corrupt turd.

World Bank President Paul D. Wolfowitz publicly apologized yesterday for the "mistake" of personally orchestrating a high-paying job and guaranteed promotions for a bank employee with whom he is romantically involved, as new details of his role in the arrangement emerged and staff members angrily demanded his resignation.

Wolfowitz attempted to address about 200 staffers gathered in the bank's central atrium but left after some began hissing, booing, and chanting "Resign. . . . Resign." He had approached the gathering after holding a news conference in which he said, "I made a mistake for which I am sorry."

OK. So he apologizes for personally orchestrating all those cool perks for his personal pelvic affiliate. But there's more.

... the bank ethics committee, citing conflict of interest regulations, ruled that she had to leave the institution. It agreed to give her a pre-departure promotion to compensate for the career disruption. Until yesterday, Wolfowitz and his aides had insisted that "all arrangements concerning Shaha Riza were made at the direction of the bank's board of directors." Bank sources said, however, that neither the board nor the ethics committee was aware of the terms of the final agreement.

Umm, that makes Wolfowitz a goddamned liar, doesn't it? Pop a chocolate covered WMD and think about that for a minute.

You'd think after being booed, hissed at, exposed for pressuring the HR department of the World Bank and getting his girlfriend more money than the Secretary of State that he'd be a little on the contrite side of things and just keep his mouth shut. But, oh no! He proves how unbelievably dumb he really is:

Wolfowitz bemoaned that the controversy threatens to overshadow the official agenda of the bank's annual spring meeting opening here today -- including ratification of a global anti-corruption strategy and funding to reduce poverty in Africa.

Timing is everything, isn't it?