Understanding our Economic Fix : The Crippled Financial System

Posted on December 5, 2009 by Thorne Dreyer

Cartoon by Manny Francisco / Manila Times / Black Commentator.

The product of neocon economics:
Our badly damaged financial system

By Sherman DeBrosse / The Rag Blog / December 5, 2009

The Democrats could lose between 20 and 35 House seats in 2010 because the banks are sitting on over $1 trillion in excess of reserve requirements. The normal practice is to hold this sleeping money to a minimum. In September 2008 it amounted to $2 billion.

Though bank stocks have soared, the fact is that we are still not half way through the bank default cycle that resulted from Bush administration policies. The trillion in unused money is a massive drag on recovery and reemployment.

In the September 22, 2008, issue of investment Commentary, BlackRock vice chairman Bob Doll wrote that “The financial system did come close to a meltdown last week as credit borrowing and lending… came close to breaking down.” That all happened on George W. Bush’s watch. Now we’re 11 months into the administration of President Barack Obama, and Republicans are making great headway blaming all our economic and financial problems on him.

The near meltdown

The financial system collapse was so great that respected observers like Martin Wolf are saying we should count it a great victory that it still exists at all. Less money is being lent now than last year, and the big banks are again hoarding cash and making the same kinds of bets that created disaster before. In the last six months, loans at commercial banks have dropped by 6%. The banking sector is still very unhealthy, and none of this can be blamed on President Obama. In fact, Obama played a big role in pulling us back from the precipice.

This writer believed that the Obama Administration should have come as close as possible — but just short of nationalization — to following the advice of Nobel Prize winners Paul Stiglitz and Joseph Stiglitz in moving quickly to purge the banks of bad assets. Instead, Obama opted for “intelligent centrism,” perhaps because things were so bad that only insiders knew how to rejigger the financial system. Timothy Geithner offered them a means for purging some assets that was more than generous, and the bankers simply held out for assistance from the Fed on their terms.

As might be expected, Republicans behave as though there were all sorts of other options available, but they name none! We can do little but hold our breath and hope they know what they are doing because we need them to restore lost capitalization as quickly as possible.

Our financial system has been badly damaged and will be fragile for some years. The economy cannot run well without a solid financial system, and there are no signs that we can repair in the short term the damage done by the gradual deterioration of the industrial sector.

Elizabeth Warren put it bluntly: “Today’s business model is about making money through tricks and traps.” That has certainly been the case in the financial sector, where people behave recklessly in what seems like a very high stakes casino because (1) the potential rewards are fantastic, and (2) they know government will cover their bets. Their firms are too big to fail.

The average employee at Goldman Sachs stands to earn $700,000 this year. The present formulae for rewarding traders in financial houses seem to encourage reckless behavior. Congress needs to investigate these formulae and use the tax code to discourage irresponsible conduct. We should prevent the bubble from growing still more, with high taxes on unreasonable bonuses and by requiring that one third of each bonus be held in escrow for three years to see how the transaction turns out and to provide a reserve for people hurt by bad transactions.

We need to slowly let some of the air out of the financial services bubble as a means of preventing a catastrophe. While doing this, we must begin to phase in new regulations that protect depositors in commercial banks and patrons of insurance companies. The big financial houses must be weaned off of the wild bets that almost destroyed our financial system. All this must be done slowly and gradually so as not to disrupt either the economy or the financial system.

Cartoon from Reject the Herd.

Bubbles

Of late, our markets have been driven by bubbles — technology, dot coms, then housing. We remember that Thomas Jefferson was one of many famous men to write and warn about bubbles. The problem is that they are not always easy to spot, and Ben Bernanke says spotting them is “perhaps the most difficult problem for monetary policy this decade.” Until last year, the common wisdom was that bubbles do not burst and that the best way to address them is to do nothing. Now we know that some bubbles must be pricked.

One way to deal with bubbles is to raise interest rates. The problem is that doing so can slow the whole economy. Perhaps we need to commission studies in how differentiated rediscount rates could be applied. That is to say that the rediscount rate for investment in plants, retail inventories, and housing might be lower than that on money borrowed for financial speculation.

Another approach would be requiring banks to have larger capital cushions.
There is a concern that today people are borrowing dollars at very low interest rates to speculate in assets here and abroad. The Asian nations are complaining that our investors are creating a bubble in Asian assets. This could be the next bubble to disrupt the world of finance. We need to invest in having economists create models that show how much interest rates should be raised when financial leverage and asset prices get too high.

The Fed has created a “quantitative surveillance group” to gather all sorts of data that will help it detect and deal with booms. The two major Congressional committees dealing with banking should create a parallel mechanism so that they can better monitor what the Fed does. While Congress is doing that, it might take a fresh look at the practice of letting the banks appoint six of the nine people on each of the regional FED boards.

The two committees should also hire experts with proven records in monitoring what goes on in the financial sector. If I were doing the hiring, I would ask former Governor Eliot Spitzer to recommend appointees. After all he, in a now famous Op-Ed, saw the financial meltdown coming and explained what had gone wrong.

Backstopping the banks

The larger problem was that government got into the habit of covering the massive losses of investment banks. The precedent was set when Ronald Reagan used Brady Bonds to make foolish and massive Latin American loans underwritten by bankers greedy for excessive commissions.

Then there was the very quiet bailout of Citi in the mid 1980s. That period was marked by the junk bond spree and unrealistic housing prices. The Fed had to come to the rescue with great amounts of new currency and low interest rates. We all know about the S & L and commercial banks bailouts under Daddy Bush. All of that came to a little less than $7 trillion in underwriting by the Treasury and the Fed. Now, there was the poorly conceived TARP, and who knows how many Fed guarantees. Then add another two or three trillion in guarantees issued before Bush left office.

Recently, the Republicans claimed that the Obama administration had incurred $14 trillion in new debt. Of course, they provided no data on how they reached this figure. For one thing, they are lumping together actual borrowing, as in the case of Bush’s TARP, with commitments to securitize bank assets. It may well be that the two together will come to $14 billion if the financial houses need much more help. Nine or 10 trillion of that was incurred under Republicans, and the rest will have been spent to fix a financial system the GOP said was desirable and sound. Moreover, it is usually the case that the doubtful assets that are being covered have some value.

Obama‘s Public Private Investment Program was designed to avoid any step that looked at all like nationalization help the big banks. For the most part, the bankers did not bite. They went back to the strategy that began back in 1981 when they blackmailed Reagan into covering all their bad debt with Brady Bonds. Now, the Federal Reserve has agreed to simply cover almost all the bad securities.

None of this can be fixed until a significant part of the public comes to understand the problem and no longer goes into panic attacks when Republicans start screaming about “nationalization” and socialism.” If those tactics continue to be successful, there is no way to fix our financial system. The Europeans, especially the Germans, are appalled that we are doing so little to fix a bad system. Our trans-Atlantic critics simply do not understand the power the folklore of Capitalism possesses here. While the European banks have been cleaning up and shrinking their balance sheets, there is little evidence that our institutions have emulated their example.

All the financial crises of the last 200 years began with the threatened or actual collapse of a first, second, or even third tier institution. At that point, all the talk about rational expectations goes out the window. What happens is that people panic and that leads to large systemic crisis. People like Richard Shelby, ranking Republican on the Senate Banking Committee, can talk endlessly about simply letting banks fail, but that would only intensify the panic. It’s a non-option and would make things a lot worse.

The scale of the derivatives problem

In the recent near-crash of the financial system, trade in derivatives greatly magnified problems created by the housing bubble. Manufacturing and energy firms also trade in derivatives. Derivative financial instruments are based on collateralized mortgages that were bundled as “collateralized debt obligations,” and many other things. For the most part, the financial services boom was based on trade in these bundled mortgages.

What is hard to understand for the layman is how the same batch of mortgages can become the collateral for a number of derivative instruments that are essentially laid on top of one another. One form of derivative is the credit default swap, which was invented as a sort of insurance on risky loans. What they became were wagers on what bundled securities would turn out to be profitable. Then people placed bets on the bets, and on and on. In September 2008 there was $54 trillion in the credit swaps market. To put this in perspective, we should look at the 2008 Gross Domestic Product, $14,441,425,000. The $54 trillion gambled on one kind of derivative far exceeds the $14.4 trillion GDP.

When one comprehends how many times a single bundle of mortgages was the object of bets, it becomes clear that if government were to simply pay off all home mortgages it would not have addressed the problem presented by all the paper based on bundled mortgages.

It has been assumed that markets work efficiently and that we can expect that markets place correct values on things because people use all the available information to inform their investment decisions. Low interest rates and huge amounts of money available for doubtful loans created a housing bubble. Regulators and policy makers should have looked at the low interest rates and have expected problems.

We need to concede to Republicans that Henry Cisneros and Andrew Cuomo made too much Fannie Mae and Freddie Mac money available for doubtful mortgages. But the excesses of the private sector far outstripped federal foolishness. For example, New Century Financial was bragging that it could generate a mortgage offer in as little as twelve seconds.

If a big outfit like Lehman Brothers issued a hundred million in residential mortgage bonds, it would pay a rating agency $40,000 to put out a credit rating. The agency, of course, gave a good rating rather than see the business go elsewhere.

The Commodity Futures Commission warned about excesses in the derivatives trade in the late 1990s and wanted to regulate them. The big bankers said any such regulation would destroy world financial markets; nothing happened. Now, some steps might be taken to regulate derivative instruments, but they probably will not be sufficient.

Now we know that a second big variable in bringing about the crash was the low margins set by the banks for investors borrowing on the basis of packages of collateralized securities. The lower the margins, the more these people gambled. That drove prices to unrealistically high levels.

There was nothing efficient or rational about the market in derivatives. One bit of bad news would drive lenders to jack up margins, forcing the borrower to quickly sell at large losses. Again, the value of the securities in question might now be unrealistically low. It appears that margin demands are far more important in the collateralized securities market than the interest rates. At the moment, the economists seem to have no models for understanding how this works. We have no exact information that regulators could be using.

People are admitting that the financial economists, who analyze Wall Street, may not quite understand how the things they study influence the overall economy. This writer has seen no evidence that even the greatest macroeconomists understand that. The accounts of what happened to Lehman Brothers and other big firms suggest that the financial economists did not grasp what the “quants“ were doing. In the case of the housing mortgages. these people, often physicists or pure mathematicians, designed the derivative instruments that somehow were to pay far more in dividends than could ever be yielded by the interest rates collected on the home mortgages that underpinned them. How was that possible?

We read that former Secretary of the Treasury Robert Rubin urged his firm, Rubin, to invest more in securities he did not understand. Likewise, Robert Willumstad, CEO of AIG, did not have a clear idea of what his quants and derivative traders were doing. Some firms replaced CEOs who might have reigned in risk with men who had no fear of risk, had no understanding of some of the securities they held, and asked no questions about their firms’ obligations. Lehman Brothers met half of its capital requirement in treasuries in 2003, and in 2006, its mortgage and asset-backed securities tripled.

We do not know much about the leverage cycle in derivatives, yet it seems that the big financial casino is operating the same as it did before the collapse, except that the bets are not being based on home mortgages. Enormous amounts of money are being set aside to reward the people who design the instruments and place the bets.Similarly, all financial institutions should be required to have liability reserves. Granted, this would have to be phased in slowly as they need time to clear their balances of bad assets. Future assistance from the Fed should be accompanied by strict repurchase agreements.

There is still another way to get a handle on how much is being bet on derivatives and in hedge funds. There is much we barely understand about today’s badly flawed financial system. On November 3, 2009, The Wall Street Journal printed a table showing the executive pension obligations of 10 big firms. It said “Total owed in billions” and noted that the money was for from four to six top executives. Given that the sums set aside were in the billions, it was logical for me to assume that we are executive teams over a number of years, So my assumption was that these firms were really putting aside money for several teams that could number together somewhere around 25 people.

At the top of the list was General Electric with an obligation of $140 billion. Its obligation rose by 13% this year. Next was Exxon Mobil at $108.2 billion. Its obligation rose by 18%. At the bottom of the lost was Bank of America at $63.2%. Its obligation only rose by 2%. Those are huge sums, and one wonders what these men earned for the corporations to produce such sums. Maybe this is partly understandable as far as the four energy companies are concerned.
One might think that the WSJ table was in error and that it meant “millions” rather than “billions.” But three weeks passed and no correction was printed.

Illustration by Caitlin Dover / The Nation.

Reregulation

Europeans are very impatient with us because so little is being done to reregulate our financial markets. We have no idea how much money is in the various complex derivative instruments created by “quants,” usually physicists and pure mathematicians. But it has to be a lot more than the $54 billion mentioned above. We also know that the big investment houses are setting aside billions as bonuses for their traders. So far this year, Goldman Sachs has set aside $16 billion for this purpose. That gives us some idea of how that single firm has bet in the great financial casino.

The simple fact is that the taxpayers are on the hook for the whole financial system. Rational people might consider letting the government own almost all the big banks, but that is a non-starter here. The best we can do is dissolve the distinction between banks and non-banks, subject them all to much tougher regulation, legislate disclosure requirement that will make regulation easier, and hire many more regulators. There should also be a strong safety net erected which would be paid for by fees collected from anyone who does anything that looks like banking.

Representative Ed Perlmutter thinks we should prevent some companies from operating both banks and insurance companies. That would be a good beginning. Representative Paul Kanjorski would give bank regulators power to limit the size and risks of any company when it seems to be acting in a way that could endanger the economy. He said, “It essentially gives us the power to amputate the leg before the infection kills the entire body.” Good idea, but the trick would be to find regulators who believed enough in regulations to do difficult things. More derivatives should be traded through central counterparties or on exchanges. In that way regulators could better keep track of what is going on.

It is clear that meaningful regulations will emerge from the work of the Frank Committee in the House and the Dodd Committee in the Senate. As soon as the new Democratic administration took power, work began on reregulation. In the case of Japan, nothing happened for more than six years, and that economy remained in the doldrums.

We should establish a central clearing house for derivatives, but so far it appears it would only deal with “standardized” derivatives. We should do more, and even the Chinese have moved to place all their derivatives in a central market. Our clearinghouse, should deal with all derivatives and no exception should be made for “customized” derivatives. The proposed regulations do not include oil companies and other non-financial institutions that issue derivatives. They should be included.

There is probably no good way to impose the kinds of reasonable regulations the financiers will accept. In reregulating, our problem is that we cannot do anything to rapidly deflate what is still a humungous financial services bubble. To do so would unleash financial pandemonium that would make 1929 look like a minor event.

In the long run, we must move toward Paul Voelker’s solution, reinstating Glass-Steagall so that ordinary commercial banks can no longer gamble with the savings of ordinary folks. A second step would be to prevent insurance companies from investing the premiums we pay in very risky instruments. When some of those firms lost large portions of their reserves last year, they went to state insurance commissions and easily got permission to boost premium rates that were supposed to be fixed 20% or more. But both of these goals can only be pursued in stages.

Political dimensions

The Republicans so far have been quiet about what they think about restoring regulations they busily dismantled for decades. That is partly because some who will be elected next November seem to want some limited regulations. With the growing power of the teabaggers, it may be necessary and very good politics to denounce their Wall Street banker friends and support regulation. Democrats need to seize the initiative here to blunt Republican exploitation of economic populism and to place the blame where it belongs, with the GOP and the NeoCons.

This is the moment to reregulate the financial sector because the Republicans will find it too politically dangerous to speak out against reregulation. One wonders what the teabaggers would think if they learned their hero former Representative Dick Armey is an architect of deregulation and a minion of the Wall Street bankers?

Reregulation must be done soon, and certainly before the next Congress is seated. By then the GOP may be in a position to block the process. The Obama Administration is making a serious mistake moving so slowly in replacing U.S. Attorneys and filling the many vacancies in the federal judiciary. It should move rapidly in both directions. After 2011, it might be much more difficult to confirm progressive judges.

The political pollsters tell us that it is impossible to get voters to listen to two and three step economic arguments. They say that the independents, who now comprise between 19 and 24% of the electorate, are mostly people who dislike both parties, dislike politics, and do not examine issues with any care. Hence, they are prone to be impatient and to swing back and forth on many questions. It is wrong to think of them as being in the center: to assume that at the moment they are blaming the Democrats for not fixing the economy instantly, and that they will probably think the same way in November 2010.

At the moment, the Republican strategy of obstruction, offering no alternatives, and peddling false information is paying off. They are activating their base and appealing to independents, most of whom look for simplistic explanations. But if those independents have investments and retirement programs, it may be dawning on them that they need to be learning a little more about economic matters just so they can make decisions about retirement, sending the kids to college, and the like.

Forty and 50 years ago, I marveled at the economic literacy of ordinary British voters, most of whom had not gone beyond secondary school. It was phenomenal and largely due to the hard work of the British Labour Party. Labour was able to get ordinary people to focus on economics because Britain faced hard times then.

Democrats must begin the very difficult task of educating voters about the source of our problems — Republican economics — and showing voters what progressive solutions can do. Above all, we need to make economic populism an important weapon for the Democratic Party.

In the short term, this strategy may somewhat trim Republican gains in 2010. The long-term prospects are not for a healthy economy, a stable financial system, or a strong dollar. Even though the recession is supposed to be officially over, the Fed’s balance sheet continues to swell. It is doubtful that inflation or even stagflation can be held at bay for long. There is no evidence that the living standard of the middle class will improve. It will continue to erode, and progressives must dedicate themselves to explaining why.

Given all this, it makes sense for the Democrats to learn how to educate people on economics. In time, this strategy will move the political fulcrum to the left and usher in an era of Democratic dominance wherein the party will no longer need the likes of near turncoats like Joe Lieberman.

[Sherman DeBrosse is a retired history teacher. Sherm spent seven years writing an analytical chronicle of what the Republicans have been up to since the 1970s. The New Republican Coalition : Its Rise and Impact, The Seventies to Present (Publish America) can be acquired by calling 301-695-1707. On line, go here.]

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Organic Farming : Cutting Carbon Emissions Big Time

Posted on December 4, 2009 by Thorne Dreyer

Photo from The Red Mullet.

Going organic:
Dump the mega-corps and save the world?

By Steve Russell / The Rag Blog / December 4, 2009

A new report from The Soil Association [see article below] says a worldwide switch to organic farming would cut CO2 emissions by 11%.

That’s a huge return that ought to be considered for the sheer size of the result.

There are two problems to be addressed, one practical and one political.

The practical one is to compute the effect on yield, something that concerns farmers but also has to concern consumers.

The political one is the mega-corporations that produce the chemicals — herbicides and pesticides and fertilizers. They own so many farm state politicians that they are even able to get them to vote against farmers now and then.

It’s a long process, but to do anything about it you have to work out the yield problem to get the farmers on your side and then take on the Monsantos of the world. This is a hard enough slog that putting all the climate eggs in this basket would be hazardous to your health, but it needs to be considered as one front among many.

The only policy that does not require such a multi-front political war is a carbon tax, since it goes directly at the problem. On this front, a carbon tax would change the economics of chemical-based agriculture and jog the numbers in favor of organics regardless of yields.

Soil Carbon and organic farming (report)

By Gundala Azeez / December 2, 2009

New research from the Soil Association reveals that if all UK farmland was converted to organic farming, at least 3.2 million tonnes of carbon would be taken up by the soil each year — the equivalent of taking nearly 1 million cars off the road.

According to the Intergovernmental Panel on Climate Change (IPCC), 89% of agriculture’s global greenhouse gas (GHG) mitigation potential is from carbon sequestration — a fact that governments seem to be ignoring in the critical run-up to climate change talks in Copenhagen (COP 15) in December.

The research’s key findings are:

  • The widespread adoption of organic farming practices in the UK would offset 23% of UK agricultural emissions through soil carbon sequestration alone, more than doubling the UK Government’s pathetically low target of a 6-11% reduction by 2020
  • A worldwide switch to organic farming could offset 11% of all global greenhouse gas emissions. Raising soil carbon levels would also make farming worldwide more resilient to extremes of climate like droughts and floods, leading to greater food security
  • On average organic farming produces 28% higher levels of soil carbon compared to non-organic farming in Northern Europe, and 20% higher for all countries studied (in Europe, North America and Australasia)
  • In the UK, grasslands and mixed farming systems also have a vital role to play, and soil carbon may go a long way to offsetting the methane emissions from grass-fed cattle and sheep.

Source / Energy Bulletin

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RIP Bobby Keane : The Rise and Fall of a Music Man

Posted on December 4, 2009 by Thorne Dreyer

Ritchie Valens, left, and Bob Keane, then president of Del-Fi Records, on TV show in Los Angeles, 1958. Photo from Michael Ochs Archives / Getty Images.

Musician and music biz progidy:
The ill-starred life of Bobby Keane

By Carl R. Hultberg / The Rag Blog / December 4, 2009

Bobby Kuhn was born in California in 1922, at Manhattan Beach, later famous for its surf scene. Since the surfers hadn’t discovered the waves yet, Bobby was crazy for the Benny Goodman Band. Everyone was.

For one thing, Benny had an interracial unit when that really meant something back in the 1930s. It was Goodman’s wild experimental trad clarinet mixed up with all kinds of modern ideas, like black blues-jazz electric guitar (Charlie Christian), jazz vibraphone (Lionel Hampton), a teenage sensation white drummer (Gene Krupa). This was the future, man!

But first World War II, so Bobby Kuhn learned to fly and taught other U.S. Army Air Corps pilots to do the same. Before the war, Bobby had been the nation’s youngest jazz bandleader at age 17. After the war he substituted for Artie Shaw in that big band and later went on to create and perform music for early television. Somewhere along the line he changed his name first to Bobby Keene, than later, Bobby Keane.

The success his early promise had foretold had not been realized, so he decided to go into the record business. It was the mid-1950s and the teenage rock and roll scene was just taking off. His first big discovery was none other than Sam Cooke, who Keane picked out of the lineup of the Gospel singing Soul Stirrers. Cooke’s original hit, “You Send Me,” was recorded for Keane’s Keen Records label. But Bob Keane was pushed out of Keen Records as soon as Mr. Cooke’s success became a reality. Probably by the Mob, because soon Allen Klein was in charge of Sam Cooke’s career.

A year later (1958), Bob Keane discovered a burly Mexican American teenager driving some teenage girls crazy with an electric guitar at a show before a movie in LA. At Keane’s urging the kid changed his name to Richie Valens and, with Bob’s tutelage and grooming, soon became a top ten recording star. A year later, Richie Valens (along with Buddy Holly and the Big Bopper) was killed in a tragic plane crash.

Meanwhile Bob Keane, the producer, gave some future stars their first breaks. Soul singer Brenda Holloway, for example. Young recording studio prodigy Frank Zappa had just been busted for creating a soundtrack for a porno movie when he got to place some of his surf guitar and doo wop recordings with Keane’s new record company venture Del-Fi in 1963. Other Surf groups had recorded on this label, including the genre defining Surfaris. Here Bob was recording music from groups operating out of the beach town he had been born in.

But after all the tragic disappointments and small time success Bob Keane had suffered through in the record business, by the mid 1960s he was sure he’d found the big act he had been looking for. The Bobby Fuller Four, out of Texas, had it all. For one thing, in many ways they were the spitting musical image of Buddy Holly’s Crickets. Their first hit was a cover of Buddy’s “Love’s Made a Fool of You.” The group’s leader, singer, guitarist was the ultra clean cut non druggy but still somewhat wild, charismatic and soulful Bobby Fuller. The group could easily be as big as Paul Revere and the Raiders, for example.

Bobby Fuller: mob hit?

Bobby Fuller proved his worth soon thereafter in 1966 going right into the Top Ten with “I Fought the Law,” a song written by Sonny Curtis, one of the Crickets. This was it. Bob Keane had finally hit the big time with a solid group on his Del-Fi label. The promise he had shown in those early years, after all those discoveries he never got to benefit from, would surely be borne out when the Bobby Fuller Four created their legacy under his guidance.

But something went terribly wrong. Perhaps the cocky Bobby Fuller did something he shouldn’t have done. Like maybe ask the wrong people where his royalty money went. Whatever happened, later in 1966 young Bobby Fuller was found dead in his car near his house, the victim of (probably forced) gasoline ingestion. Don’t mess with the Mob.

So that was it for Bob Keane’s career in the big time music business. He went on to selling things door to door and managing his son’s rock band. It just goes to show that talent will get you nowhere if you don’t get and keep the right connections. The most amazing thing is that in the midst of this cesspool of greed, fear and exploitation some great music actually comes out once and a while.

Bob Keane was one of the guys who fought for talent, and though he ultimately lost all his commercial battles and his discoveries were mostly all doomed, the great music he recorded is with us still. Maybe Bob Keane knew that’s all that really matters,

RIP.

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Harm’s Way : Escalation and the GI Suicide Crisis

Posted on December 4, 2009 by Thorne Dreyer


Mental health and the suicide rate:
Sending soldiers into harm’s way

By Michael Anthony / The Rag Blog / December 4, 2009

President Obama recently stated that sending more troops into harm’s way in Afghanistan is a solemn decision — one that he would not rush. As a veteran, I find the decision to send troops into harm’s way without an effective military mental health program in place beyond solemn. It’s deeply disturbing. Keeping soldiers mentally fit should be as important as keeping them physically fit.

Since the wars in Afghanistan and Iraq started, nearly 2,000 active-service soldiers have killed themselves, according to a report by the San Antonio Express-News earlier this year. Even more alarming is the fact that every day, five active-duty service members attempt suicide. In the past eight years, that means up to 14,000 have felt their life is not worth living.

The government doesn’t want you to know this. In the spring of 2008, CBS news journalist Armen Keteyian exposed a Veterans Administration cover up of suicide stats. The reporting revealed that every day, 18 veterans kill themselves and roughly 1000 attempt suicide each month. The VA’s head of Mental Health had claimed there were only 790 attempts in all of 2007, a far cry from the reality.

Among all veterans, over the eight years we’ve been at war in the Middle East, the statistics point out that roughly 50,000 have committed suicide, with upwards of 44,000 attempting suicide. These figures only represent data gathered since 2001; this has been an ongoing and persistent problem since Vietnam — and the numbers go up each day.

Recently, the Army made a big deal about giving $50 million to fund a five-year research project on military suicide. In their book, The Three Trillion Dollar War, Linda J. Bilmes and Nobel Prize-winning economist Joseph E. Stiglitz figured the cost of the Iraq war at $12 billion a month. That means we spend more than $16 million an hour.

If you do the math, the $50 million that went to suicide research is what we spend every three hours in Iraq.

The day after Christmas this year will mark our 3,000th day at war. At this point, we’ve heard a lot about suicide bombers, but what about suicide? Regardless of anyone’s feelings about our involvement in Iraq and Afghanistan, these soldiers deserve much more than three hours of our time.

[SPC Michael Anthony is the author of Mass Casualties: A Young Medic’s True Story of Death, Deception and Dishonor in Iraq (Adams Media, October 2009). The book is drawn from the personal journals of SPC Anthony during his first year of service in Iraq.]

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Roger Baker : Can the Economy Recover?

Posted on December 4, 2009 by Thorne Dreyer

Cartoon from Talking Union.

Can the economy recover?
And, for that matter, should it?

By Roger Baker / The Rag Blog / December 4, 2009

[Steven Chu, U.S. Secretary of Energy] was my boss. He knows all about peak oil, but he can’t talk about it. If the government announced that peak oil was threatening our economy, Wall Street would crash. He just can’t say anything about it.” — David Fridley, scientist at Lawrence Berkeley National Laboratory.

Can the U.S., or indeed the global economy, ever recover? Concerning this issue, and it is an issue likely to effect most people now living, there is both bad news and good news.

First the bad news. There has been a growing awareness within the scientific community for more than a decade, that if the inherently expansive global capitalist economy as we have known it does recover, it will probably continue to disrupt nature and inflict human misery on a massive global scale.

The global economy has been increasingly bumping into the natural limits of all the human beings the planet can support, assuming they are to live under tolerable civilized conditions. Peak oil, global warming, water shortages, deforestation, polluted oceans, species extinction. You name it, we are now bumping into many kinds of natural limits.

If we do not somehow turn away from exponential growth as usual, and shift toward a more localized, sustainable economy, then wars over limited resources will become increasingly likely. A growing global population can easily overshoot the long term food limits of the environment. Famine has happened locally throughout history, but with a global economy, global hunger becomes possible. When food runs short, tempers flare.

Here’s Walter Youngquist from The Oil Drum:

In various contexts throughout this volume [GeoDestinies] it is pointed out that we now live in unique times, unlike any in the past, and unlike what any will be in the future. Yet many people in developed countries do not realize the unique years we have had since the beginning of the Industrial Revolution. This fact, as a framework to understand the present and what lies ahead cannot be overemphasized.

We have developed technology by which we have exploited the Earth’s resources to a degree never before seen and which, in the case of non-renewable resources – fossil fuels, and metals as well as nonmetals, can never be repeated. We have drawn both from the past, and also mortgaged the next few centuries at least by degrading the vital renewable resources of soil and freshwater, which are not renewable within the span of several lifetimes. This is in contrast to many centuries of history when, lacking technology of today, things changed very slowly…

Top climate scientists like NASA head James Hansen are now pleading with us to tax the carbon we burn, and then to use the tax revenue to help restructure the economy on a wiser, sounder basis.

…Governments must place a uniform rising price on carbon, collected at the fossil fuel source — the mine or port of entry. The fee should be given to the public in toto, as a uniform dividend, payroll tax deduction or both. Such a tax is progressive — the dividend exceeds added energy costs for 60% of the public…

So what about the good news? The good news is that neither the U.S. economy, nor the global economy, will recover, because they can’t. (Read on to learn why this is good news.) They cannot keep expanding in the profitably rapacious way that until recently was considered quite normal. The immediate problem is that nobody has figured out a way to have the global economy, as presently configured, expand without a corresponding increase in the supply of liquid fuel, and for a long time to come.

All things considered, where does this lead?

It is a major challenge to try to rationally convince most people that their total pile of material goods, and that accessible to their children, will by necessity have to shrink, no matter what. The way humans tend to think, selling bad news through intellectual persuasion is never easy. Not easy as compared to selling optimistic snake oil approaches that promise a relatively painless alternative to facing hard choices.

The USA now has a conspicuously dysfunctional political system. A system which allows the banker class to force the (previously) U.S. working class to assume the economic burden of somehow paying off their global finance gambling debts, including the gloriously reckless sub-prime loans made by the world’s giant investment banks up to mid-2007. Think Dubai. (Some of us aware of peak oil have been trying to warn the world for over a decade that global investment trends were unsustainable from an oil perspective alone.)

From current trends, the U.S. public consciousness, in its political and economic perspective, is being forced to shift from the Clinton-Bush-era standard of reasonably assured economic well-being, toward an economic perspective of basic survival. The numbers of those concerned with basic survival, like the jobless and homeless, are already intolerably high by recent U.S. standards. These numbers will probably have to increase further before now-unemployed labor shifts toward local manufacture, agriculture, etc.

In the face of crisis, the public elected Obama to revive a troubled economy. If FDR made the Great Depression go away (with the help of WWII), then the right president acting in the right way should be able to make that happen again, right?

The bottom line is that the current production and the depletion numbers associated with peak oil are, by themselves, enough to indicate that we are headed toward an economic crisis. Getting the global economy back on its old expansionist track is likely to prove impossible, no matter how hard we try. We are now faced with the challenge of restructuring our economy in a way that would normally take decades. Yet we face other additional handicaps. We have an industrially hollowed-out U.S. economy, an aging U.S. population, and a conspicuously dysfunctional political system.

Tom Tomorrow on Peak Oil.

The cheap liquid fuel-based energy needed to transport the goods of global commerce on the previous scale is not there anymore. It is now cheaper to make steel in the USA than to try to ship it here from China. Conventional oil production on land probably peaked in 2005. We are now using expensive conventional oil alternatives like heavy oil, oil sands, and deep-water oil as a cushion to try to buy time before oil production, and thus the global economy, starts shrinking, and fast. The previously silent oil industry itself is now starting to admit as much:

Groups and individuals speaking out about forthcoming world oil supply challenges are frequently stereotyped as a fringe element with little knowledge about the oil industry. But their warnings are increasingly supported by some surprising allies: senior petroleum industry officials, consultants and analysts. Call these serious-minded critics the HarshRealists…

The bad news related to the peak oil situation is especially hard for politicians to publicly acknowledge, but even among such leaders, the word is spreading.

What would it take for average Americans to cut back drastically on their total oil use? I suspect that many readers would be amazed to hear that this has already happened! Without most folks paying too much attention, U.S. oil consumption dropped from about 21.7 million barrels a day in August 2005 to about 18.8 million barrels in recent months. An almost 3 million barrels a day decrease on a base of about 20 million is about a 15% percent decrease over the past four years, with 9% of that being in just the last two years.

These last four years were the years when we made the relatively easy cuts in excess driving, etc., in response to rising oil price and a depressed economy. Now it will get harder, because it looks like we are facing an oil-less recovery.

From Steven R. Kopits:

…Consumption is not much changed since the end of the recession. And before the recession, demand in the United States was falling at around $75/barrel. Therefore, based on the most recent observed period, we would expect US consumption to stagnate around recent prices approaching $80…

Overall, then, U.S. consumption is unlikely to ever recover levels seen in 2007. In the best of cases, consumption could close half the last years’ decline and increase by about 5%, or 1 mbpd. As likely is the possibility that consumption will stagnate at or near current levels, and may be significantly sensitive to prices at or near those seen recently. U.S. consumption is perhaps most likely to increase modestly by perhaps 0.5 mbpd, reaching approximately 19.0-19.5 mbpd.

As the country looks to recovery, policy makers must face the very real possibility that economic growth cannot depend on very much extra oil, and perhaps none at all. It may well prove an oil-less recovery, with all the implications that brings for employment and the economic outlook.

Given the current situation, the world’s major economies might encourage easy credit and steer the global economy in such a way that it is successfully stimulated, meaning that aggregate demand for traded goods and commodities revives sooner. But this only means that we in the U.S. will try to bid against China for a global daily supply of oil falling somewhere short of 90 million barrels per day. Aggressive oil bidding is likely to be soon followed by another oil price spike,

Thereafter, we would likely see a return to the sort of stalling-out of the U.S. economy and rapid deflation that we saw after gasoline hit $4 a gallon in mid-2008, when GM went broke, etc. There is probably now less than five million barrels a day of global reserve oil capacity, mostly with OPEC, to cushion the system from another oil price spike, and this cushion is shrinking.

The current global recession combined with stagnant oil production can postpone the return of a tight market for the global oil supply, but not for a lot longer. A smart guess is that by 2012, global oil depletion in excess of five percent a year will cause serious economic problems through falling oil production — no matter what we do.

Regarding this unhappy situation, here is what a distinguished retired CIA analyst, Tom Whipple, who writes a weekly (and also daily) column on the ASPO-USA website, has to say about the potential for recovery of the global economy. He points out the the numbers indicate that we are now apparently in a sort of economic trap.

…We can’t have it both ways. It will either be a really deep global recession and cheap gas or some sort of start at recovery and spiking oil prices. Discussions have already started as to what level of oil prices causes serious damage. In the past an inflation adjusted $80 a barrel was a favored recession inducing number as this was the price that seemed to cause recessions back in the 1970s and 80s when Middle Eastern wars and embargos restricted supplies.

The trouble with $80 oil, of course, is that we are already there and no analyst that draws a paycheck from Wall Street wants to say flat out that another leg of a recessionary downturn is inevitable unless oil prices decline soon. A typical example was a Dow Jones story earlier this week entitled “Oil Price Rise Poses Little Threat, Yet, To Economic Recovery.” The article points out that the danger to economic recovery won’t start until we get to $90 or $100 a barrel or $3 a gallon gasoline… The current situation is clearly unsustainable. If the dollar continues to sink, oil is going to move so high that all sorts of economic consequences are inevitable. OPEC is already in a dilemma for no matter how much they like the increasing revenues, the smarter governments realize that if prices move much higher, it will trigger off even worse economic times…

At this point, many environmentally conscious readers are quite likely to suggest that alternative energy will come to the rescue, offering a relatively painless landing. But alternative energy probably won’t be there in the needed quantity and on time; this outlook echoes the “Hirsch Report.” Alternative energy is without question an important step in the right direction, but we need to understand the possible limits.

These limits are related to the time required and the scale of (now treasury deficit) financing needed to make the tons of steel, copper, and aluminum that would be required in another five years. Currently, we can’t manage GM very well because we don’t know the proper industrial production targets, or even whether it makes any sense to subsidize the building of cars instead of rail. The devil is very much in such details. How fast it is possible to shift the inputs and outputs of an industrial economy to meet new needs are already known to good economists.

An alarming new study jointly released by two prominent California-based environmental/economic think tanks, concludes that unrelenting energy limits, even among alternative energy systems, will make it impossible for the industrial system to continue operating at its present scale, beyond the next few decades. The report finds that the current race by industries and governments to develop new sustainable energy technologies that can replace ecologically harmful and rapidly depleting fossil fuel and nuclear technologies, will not prove sufficient, and that this will require substantial adjustments in many operating assumptions of modern society.

The new study (“Searching for a Miracle: Net Energy Limits and the Fate of Industrial Society”) is the first major analysis to utilize the new research tools of “full life cycle assessment” and “net energy ratios” (Energy Returned on Energy Invested, EROEI), to compare all currently proposed future scenarios for how industrial society can face its long term future..

After oil peaks, which is likely already, per capita metal extraction will also have to shrink soon thereafter.

Per capita food will also have to shrink soon, as the Worldwatch Institute’s Lester Brown’s latest book documents in detail:

End Game?

Things are not so bad at the moment. At least for the short run, and from appearances, the U.S. economy is restructuring itself in an environmentally healthy direction. Consumer spending on waste is contracting to a new mode based on meeting minimal but essential needs. People faced with foreclosure and high credit card debt have cut back their spending and credit obligations as much as possible. The arrival of hard times means people giving up many kinds of culturally induced needs that Thorton Weblen once classified as conspicuous consumption status symbols; travel to business conventions, vacation homes, big SUVs, the alluring ephemera sold in malls, etc. People are making do and hoping for relief.

A key issue now on the minds of many U.S. citizens is whether the U.S. economy can be put back on track through Obama’s use of Keynesian deficit spending to stimulate the economy. In effect a shot of economic speed to get the stalled U.S. economy activated again, after which it is imagined that this stimulus can gradually be withdrawn without the economy relapsing into its previous state of stagnation.

Assuming that the U.S. finance system is required to stay solvent, and that it must be kept from falling victim to a sudden, panicky dollar devaluation, the obvious way the economy can be stimulated at the same time that the hidden mountain of bad debt the banks owe can be paid off is by printing up lots of money. Lacking an adequate supply of willing foreign lenders, this is done through mutual cooperation of the Treasury and the Fed, resulting in bond debt to be paid back later.

The Fed printing lots of money. Drawing from Cervantes.

But trying to revive the economy by means of printing up enough fiat currency to revive spending plus balance the books is akin to running up a big bar tab which eventually must be repaid. Think paper debts paid back with devalued dollars. This risky process is clearly underway, as famous investor Warren Buffett notes, although Buffett does endorse the use of temporary Keynesian economic stimulation to avert an immediate crisis:

…Buffett details his ongoing warning that the “enormous dosages of monetary medicine” being used to rescue the U.S. economy will eventually produce a dangerous “side effect.” He worries there won’t be enough lenders ready and able to absorb the nation’s growing debt relative to its economic output over the years, forcing Washington’s “printing presses” to work overtime churning out paper money. All those “greenback emissions” will, he fears, feed potentially “banana-republic” style rates of inflation…

We can see signs of inflation already if we know where to look. Economic demand, reflected in prices, for real commodities like important industrial metals, oil, and food has been steadily rising since early 2009. We can see this bumpy but steady average commodity price inflation by looking at this chart of Bloomberg’s commodities indexes. This steady increase can easily encourage other commodity speculation. Consider what the price of gold is doing right now, as a relatively inflation-proof asset that historically preserves wealth well during troubled times.

Currently, among average consumers, we see an interesting economic split. There is a discretionary spending sector in a state of relative deflation and decline as compared to spending on basic needs. Satisfying basic needs takes real stuff like food and energy. In other words, we now have sort of a dual economy in which the unnecessary spending is shrinking. The “real stuff” sector tied to things people really need is seeing price inflation, while the other discretionary spending sector is severely depressed and seeing price deflation.

However, we have a CPI (inflation) index that averages the real basic needs together with the arbitrary and artificial consumerist needs. These two consumer spending categories can sometimes cancel out and appear to indicate zero inflation. Thus we get “apples and oranges” economic nonsense that is blind to the underlying structure and causes of inflation. No inflation index that arbitrarily excludes food and energy, like our CPI does, can be very realistic. (It would be better to have an index based on ONLY these two items, because when the economy is in real trouble, these spending categories will tend to prevail).

Referring back to the troubling choice that Tom Whipple outlined above, the choice between global deflation and a start at recovery with another debilitating oil price spike, the fact is that nobody can accurately predict the economic outcome very well, and this is now leading to an ongoing debate between the deflationists and inflationists. But as we have seen, it is possible to have deflation in one important sector of the economy and simultaneous inflation in another, due to quite different factors.

“Stagflation” was the term they used for this nearly impossible-for-economists-to-remedy situation during the energy crisis of the 1970s. As the price of a limited supply of oil was bid up, it pushed up the price of everything economically tied to oil, meaning nearly all commodities, which is termed cost-push inflation.

It is likely that with the U.S. and other countries trying to restimulate their economies through deficit spending, they will succeed at some point. In a situation where they are trying to use monetary expansion to stimulate otherwise unresponsive economies, there is a real but unpredictable risk of economic disaster through hyperinflation, as Buffet observes.

There is now a lot of fresh new money sitting idle on the sidelines. Banks are managing to appear more sound by borrowing at near zero interest and then using the cash to buy interest-bearing U.S. treasury bonds; what a racket! When there is a lot of idle money around, they start looking for profitable investments. Where there is a lot of money but a deficiency of important commodities that everyone needs or wants, you get self-perpetuating speculative bubbles. Given the apparent tendency of the U.S. political system to take the easy way out, as indicated by the federal government’s inability to reinstate basic banking reform, the odds look good that we will see the continuation of inflation in the commodity sector.

When you have rising commodity prices, the markets soon notice. Soon rising prices stimulate the public willingness to buy and invest. This means the “velocity of circulation of money” increases. As soon as the public starts spending more freely, it becomes apparent how easy it is for the creation of printed money to exceed the availability of real goods.

This increased willingness for average consumers to spend in the face of rising prices has a self-perpetuating effect; money chasing goods leads to hyperinflation, finally, in general, ending in a collapse of some sort. Since this is based on something as unpredictable as consumer and investor psychology on a global scale, it is almost impossible to time or predict.

My own forecast is for continuing dollar devaluation, worsening stagflation, and finally an oil price spike that ushers in a permanently downsized economy. I would like to predict better, but the facts are stubborn.

In a sense, these details are academic. The facts by themselves seem to argue that before long we will have to accept a continuing downsizing of our average U.S. lifestyle and economic footprint. The sooner we face these jarring economic transitions, and assuming we remember our sense of humanity, the transition to a sustainable future will be all the easier and more tolerable.

[Roger Baker is a long time transportation-oriented environmental activist, an amateur energy-oriented economist, an amateur scientist and science writer, and a founding member of and an advisor to the Association for the Study of Peak Oil-USA. He is active in the Green Party and the ACLU, and is a director of the Save Our Springs Association and the Save Barton Creek Association. Mostly he enjoys being an irreverent policy wonk and writing irreverent wonkish articles for The Rag Blog.]

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Bob Simmons : A Medical Mission to Palestine (Documentary Video)

Posted on December 3, 2009 by Thorne Dreyer

A Medical Mission to Palestine – Part 1 from Telebob on Vimeo.


Good works done by good people:
A Medical Mission to Palestine

By Bob Simmons / The Rag Blog / December 3, 2009

See Parts 2-4 of A Medical Mission to Palestine, Below.

The hardest part of making this documentary was trying not to come right out and say it. The main problem with health care in Palestine is Israel.

In July of 2009, I took a trip to the country of occupied Palestine, or the West Bank, or, in the words of some Israelis, the “newly acquired lands.” What I saw was not shocking if you have been paying attention. But for me, an American who has rarely been overly concerned about the heated politics of the Middle East, it was a revelation.

I was lucky to have been included as a witness on a recent Physicians for Peace mission to Ramallah on the West Bank. My role was simply to document some of the clinics and seminars that Physicians for Peace conduct while guests of the Ministry of Health of the Palestinian Authority. I had been asked to use video to communicate some of the small victories of the mission — a child who found a new life because of a pharyngeal flap operation, a repair of a hare lip cleft palate, or maybe some other “happy ending” story that would quickly and graphically demonstrate the enormous good that PfP does on these missions to the “troubled areas” of the world.

I was up for it.

Little did I know that what I would find would change my view of the Palestine question forever.

And little did I know how hard it would be not to be “political” with my small story about a mission to make a small difference in the world.

But the truth of the matter is, there is nothing in Palestine now that is not political, from the smallest act of buying a banana, to the issue of whether the Palestinians should be allowed to have radiology machines capable of treating the population with modern techniques, whether the local drug store can carry antibiotics or not, whether they will have simple antiseptics, or whether one can go to the hospital to have a baby or be forced to have it at home with a midwife in a house with no running water. It’s all political. In some places in the world the phrase “Oh, I am not political,” is a luxury that is not a real option. And this is especially true for anyone who lives on the West Bank.

With this video I wanted to tell a story of the good works done by some good people who were trying to make a difference in people’s lives in the Middle East. But I discovered that if I tried to get rid of the politics, I couldn’t tell the story. It’s as simple as a map that shows where people now live, and who used to live where.

Map from the United Nations.

CLICK ON IMAGE TO ENLARGE

It’s a map that tells a story that no rhetoric can explain away. It’s as simple as the 400 miles of walls being erected by Israel as they disenfranchise a people, and no matter how much they deny it, Israelis “ethnically cleanse” the lands where they plan to live. Not all Israelis of course, but the party in power believes that the “manifest destiny” of Israel requires that they make life as hard as possible for the population of the country that they plan someday to completely occupy.

“The Palestinians can leave, they can go anywhere in the Middle East, they are Arabs. We are Jews, we only have here, our motherland.”

Thus, no story about health care in Palestine can be free of the background of the political issues that surround every act in the West Bank.

Physicians for Peace are the good guys. They go into countries all over the world. They bring skills and relationships and the best wishes and the best impulses on the planet. They bring with them the heart and soul of America.

Some people say “support our troops”; my instincts say, if you want to support America, then do what you can to support the people who win hearts and minds through their generosity and sense of decency. As someone once said, any fool can burn down a barn, but it takes skill and care to build one.

A Medical Mission to Palestine is about building the things that matter.

[Bob Simmons is a veteran broadcaster with over 30 years experience in most aspects of radio. He is a graduate of the University of Texas and presently lives in Austin where he has business interests and pursues his longtime avocations of photography and video production.]

A Medical Mission to Palestine – Part 2 from Telebob on Vimeo.

A Medical Mission to Palestine – Part 3 from Telebob on Vimeo.

A Medical Mission to Palestine – Part 4 from Telebob on Vimeo.

Also see:

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Human Rights in Colombia : School of the Americas and Plan Patriota

Posted on December 3, 2009 by Thorne Dreyer

Image from redsolsur.com. / Impunity Watch South America.

Colombia and the School of the Americas:
A history of human rights abuse

By Marion Delgado / The Rag Blog / December 3, 2009

See ‘Know your new military bases,’ a look at Tolemaida Air Base in Melgar, Below.

CARTAGENA DE INDIES, Colombia —

The United States recognized Colombia’s Military Forces on Friday, November 6, 2009 for their effort and commitment towards Human Rights causes in the country.

According to the U.S. Institute for Hemispheric Security Cooperation, the Colombian Army stood out as unique in the world with regard to its Human Rights leadership and the fact that it has human rights offices[sic] in its divisions, brigades and battalions.

This was reported on Colombian President Alvaro Uribe’s website. I ran across it while researching the Colombian Army’s (COLAR) record on Human Rights. From the research I’d already done at that point, it gave me pause… WTF?? I wondered, “Who would give COLAR a human rights award?”

Well, it came as no surprise when I finally figured out that the real name of the awarding organization was Western Hemisphere Institute for Security Cooperation. You will remember them as our old friends the School of the Americas, who have long been associated with Human Rights issues.

Official seal of the Western Hemisphere Institute for Security Cooperation.

The posting went on:

Lt Colonel Javier Alberto Ayala Amaya was awarded the medal of Commander of the U.S. Army, for his meritorious service and outstanding professionalism as an instructor in the field of Human Rights.

In addition, the rules of behaviour in combat and confrontation employed by the Army reflect the experience of the troops in operational law, which places the institution as a hemispheric leader in education and training programs.

Lt Colonel Amaya is part of a large group of Colombia officers and civilians who educate on human rights abroad.

I searched 14 reference sources for any mention of the “Commander of the U.S. Army Medal.” Nada. I found a “U.S. Army Commander’s Medal” that is awarded to civilians, but no mention of awarding that to foreign military personal. Probably something they hammered out just before the ceremony. It became apparent that it was just another stick in a propaganda framework as part of making our co-conspirators in the new US/Colombia military pact seem friendly. But, COLAR and the School of the Americas (SOA) do have a long association.

How the SOA shelters soldiers who face trial at home

One of the apparent functions of SOA is post-graduate protection of the thugs they train and turn loose on the population of Colombia.

In 1992, Lieutenant Colonel Victor Bernal Castaño was enrolled at the SOA to avoid having to answer to investigators about the Fusagasugá massacre of a peasant family, according to the Colombian legislature. The SOA enrolled him in its longest and most prestigious course, the Command and General Staff College, and made him “Jefe del Curso,” (Chief of Course). This was after he had already been implicated in the 1989 disappearance of campesina Sandra Velez, and was known to protect and aid death squads. Sandra is just one of hundreds who met the same fate, listed on the site below.

In another example from the early 1990s, Lieutenant Colonel Luis Felipe Becerra Bohórquez attended the SOA while a warrant was out for his arrest for his leading role in the 1988 massacre of 20 banana workers in the Urabá region. The SOA claims Becerra Bohórquez was never “formally enrolled” in officer training there, but according to Colombian government records, the Colombian Army sent him to the SOA to avoid arrest. In 1993, after his extended shelter at the SOA, he returned to Colombia and led another massacre, this time murdering 13 civilians at Riofrío. In November 1993, under intense international pressure, Colombia dismissed Becerra from the military.

This is a long-standing role of the SOA. For instance, in 1982 First Lieutenant German Espinoza Rubio, who had already graduated from the SOA in 1976, faced with an investigation into his role in assassinating several campesinos, was spirited away to the SOA for a course in “Patrol Operations.” When the danger of the truth had passed he promptly “dropped” the course and returned home.

If you are thirsty for more atrocities by SOA graduates perpetrated on the Colombian people, there are plenty here.

Thousands of human rights activists and torture survivors demonstrated against the School of the Americas at Fr. Benning, Georgia, Nov. 20-22, 2009. Photo from the Columbus Ledger-Enquirer.

The phony ‘War on Drugs’

The U.S. pays SOA graduates to murder civilians, lying to the public that the aid goes to the “War on Drugs”

In 1991, two Colombian generals thanked the U.S. Congress for $40.3 million in “anti-narcotics aid,” which they said would be used (illegally) in counterinsurgency campaigns in northeastern Colombia, where narcotics are neither grown nor processed. Both are members of the SOA “Hall of Fame”: General José Nelson Mejia Henao, inducted in 1989, and General Luis Eduardo Roca Malchel, inducted in 1991 after being known for war crimes, including torture, as recently as June 1988.

Prison guards trained at the SOA close their eyes while drug kingpins walk out of jail. In August, 1992, three Army officers were forced into early retirement after notorious cartel leader Pablo Escobar “escaped” from prison, where he had been living in grand style. Two officers were SOA graduates: Lieutenant Colonel Manuel José Espitia Sotelo, commander of the military police battalion guarding the prison, had graduated only months before. General Gustavo Pardo Ariza, head of the Fourth Brigade in Medellin, commanded soldiers who were supposed to be guarding the prison from which Escobar literally walked away.

On November 22, 1994, five top officers were dismissed by President Ernesto Samper, who overhauled the military leadership in the hopes of decreasing corruption and drug trafficking in the armed forces and improving the human rights record of the military. At least three were generals who graduated from the SOA and one is a member of the School’s “Hall of Fame,” inducted in 1993: General Hernán José Guzmán Rodriguez, Commander of the Colombian Army, known to protect and aid paramilitary death squads between 1987 and 1990, and before that known to command the soldiers who detained, tortured, gang-raped, and executed an innocent woman, Yolanda Acevedo Carvajal, and then concocted a story that she committed suicide by shooting herself in the nape of the neck.

The phony ‘War on Guerrillas’

On July 24, 1997, SOA graduate and guest instructor General Harold Bedoya Pizarro was fired from his position as chief of the armed forces by President Samper. Defense Minister Gilberto Echeverri suggested the dismissal is because of Bedoya’s unwillingness to commit to improving the military’s poor human rights record,

“Throughout Bedoya’s entire career [1965 to the present], he has been implicated with the sponsorship and organization of a network of paramilitary organizations. Bedoya, who has never undergone any investigation for his involvement in the massacres of non-combatants or other dirty-war crimes, is an articulate proponent of the continued legal involvement of local populations in counterinsurgency operations.”

On February 12, 1992, SOA graduate Captain Gilberto lbarra forced 3 peasant children to walk in front of his patrol to detonate mines and spring ambushes. Two were killed; one was seriously wounded.

From 1988-1991, at least 107 citizens of the village of Trujillo were tortured and murdered. An eyewitness said Major Alirio Antonio Urueña Jaramillo (an SOA graduate) tortured prisoners (including elderly women) with water hoses, stuffed them into coffee sacks, and chopped them to pieces with a chainsaw. The eyewitness soon disappeared. Major Urueña was promoted to Colonel. After intense international outcry, Urueña was dismissed from the Army in February 1995.

Also implicated in the Trujillo chainsaw massacre was SOA graduate Colonel Roberto Hernández, who during the same period (1990) supervised the illegal detention and torture of 42 people, most of them union members and human rights workers. Throughout the 1980s, Hernández was implicated in numerous extreme-right death squad activities.

In 1990, SOA graduate First Lieutenant Pedro Nei Acosta Gaiviso ordered the massacre of 11 campesinos, had his men dress the corpses like guerrilla forces, and then dismissed the killings as an armed confrontation between the Army and guerrillas.

And the beat goes on…

“That’s history,” you may say. In about an hour, using various sources, I turned up 17 pages of these horror stories. What about today, what kind of army will our troops mix with at the 10 Colombian military bases we’ll be sharing? What will they learn and take part in?

For one thing, they will be immediately used in Plan Patriota, in which some U.S. servicemen and women and civilian “advisors” are already involved.

Plan Patriota: Don’t ask — don’t tell

Shrouded in silence in Colombia, Plan Patriota has begun to emerge as the most ambitious military offensive to date against leftist guerrillas, with the U.S. military providing tactical and logistical support.

Taking part in the operation, which according to press reports involves 17,000 soldiers deployed in southern Colombia, are mobile forces and special jungle commandos trained by U.S. advisers and backed up by modern technology from the U.S.

The offensive is being carried out in a vast territory under the control of Colombia’s main rebel group, the 18,000-strong Revolutionary Armed Forces of Colombia (FARC), which rose up in arms four decades ago.

Plan Patriota signals the entrance of the U.S. into a new, more intense phase of military involvement in Colombia’s internal armed conflict. Unlike Plan Colombia — also financed by Washington — Plan Patriota makes no pretense of furthering U.S. counter-drug objectives.

Instead, Plan Patriota underscores the potential for escalation beyond the mission understood by Congress and beyond the appetite of the American public, unlike its predecessor, Plan Colombia; this strategy has no stated humanitarian component.

Plan Colombia, which many observers have declared a failure, sought to reduce the supply of drugs to the United States — the world’s largest market for illegal drugs — by attacking production of coca and the jungle labs that convert the leaves into cocaine, a strategy that was simultaneously supposed to reduce revenues of the leftist insurgents.

Latin American Human Rights Association (ALDHU) warns of the impact of Plan Patriota on Ecuador, which shares a 640-km (398 mi.) border with Colombia, cautioning that it could lead to an increased flow across the border of Colombian civilians fleeing the conflict, and push drug and arms traffickers into Ecuador as well.

Plan Patriota is seen as complementary to the U.S. Andean Regional Initiative, focused on Ecuador, Peru, Bolivia and Panama, and aimed, among other things, at beefing up control along the borders with Venezuela.

General James Hill top general for the U.S. Southern Command. Photo by J. Pat Carter / AP.

General James Hill, until quite recently in charge of the U.S. Southern Command, confirmed what Colombian authorities have not admitted: the magnitude and extent of the offensive against FARC. Hill, who since November, 2008, has held 13 meetings with Colombian military officers and visited Ecuador six times, passed through Bogotá on June 23, 2009 ,after touring Larandia military base in the southern state (Departamento) of Caquetá, where Plan Patriota is coordinated.

The general praised the progress of the offensive that, as has now been revealed, began in June 2003 with an attack on rural areas south of Bogotá, where local peasants support FARC. He said that the U.S. military is providing Colombian armed forces with fuel, logistical support, and planning.

(General Hill was recently replaced by Four Star Air Force General Douglas Fraser who is now the Commanding Officer of SOUCOM. SOUCOM covers 45 nations and territories and the 16 million square mile Caribbean Sea.)

A spokesman from the Bolivarian Movement, FARC’s clandestine political arm, declares that despite the impressive U.S. technology, “the popular resistance remains unbeatable.”

According to a source who spoke on condition of anonymity, the ceiling set by the U.S. Congress on the number of military advisers has already been far surpassed. He said there are “around 2,000 U.S. mercenaries. People recognize them by their accent… They walk around the town of Cartagena del Chairá [in Caquetá], and are very heavily protected.”

Why the official secrecy about the biggest military offensive in the history of Colombia’s conflict? Consider U.S. operations in Iraq, where reporters from nearly all outlets — even Al Jazeera, to some extent — have been embedded with U.S. military units, often resulting in unabashedly supportive media coverage of that controversial war.

By most accounts, the reluctance to share information about Plan Patriota comes from the Colombian side. The Colombian military is highly reluctant to grant journalists or outside observers any interviews, access to installations, or entry into theaters of operations. The most-stated reason: the need to keep sensitive tactical information from reaching the enemy (FARC).

The more likely reason is nationalist sensitivity. Not only is the Colombian government likely to balk at the prospect of foreign reporters sticking their noses into Plan Patriota, they’re probably unwilling to make public the degree of U.S. participation in what they would prefer be considered a 100 percent Colombian offensive.

No matter what the reason, such secrecy is a mistake. It leads to fear that things are going worse than they may in fact be going. It gives credence to reports that as many as 1000 Colombian soldiers have been killed, that they are bogged down in the bush and suffering from flesh-eating diseases, that they have done little more than capture relatively low-ranking guerrillas and take over already-abandoned encampments, that morale is low, and that military operations are accompanied by almost no social investment in the long-neglected rebel zones.

This is fast becoming the mainstream view of Plan Patriota among the Colombian people and in the foreign press such as the Miami Herald — a big, costly military effort that has yielded few results. Is this perception correct? ¿Quién sabes? The only way we’ll find out is if the U.S. and Colombian governments stop neglecting public opinion and abandon their insistence on total secrecy.

The U.S. has already put $700 million into Plan Patriota (no wonder we can’t afford health care), and now it plans to put thousands of U.S. troops in also, as a part of the Andean Regional Initiative.

For a preview of what Plan Patriota will look like on the ground, take a look at reports on terror in Arauca from the Colombia Support Network. For the full story of what happened there go here.

Plan Patriota.

Army killings of civilians

In recent years there has been a substantial rise in extrajudicial killings of civilians attributed to the Colombian Army, documented by the United Nations High Commissioner for Human Rights, many human rights organizations, and, most recently, the UN Special Rapporteur on Extrajudicial Executions. Army members, under pressure to show results, take civilians from their homes or workplaces, kill them, and then garb them as combatants killed in action to increase their body count.

The alleged executions have been occurring throughout the country and involve multiple army brigades. The Attorney General’s Office is reported to be investigating more than 1,000 such cases involving more than 1,700 victims.

President Uribe for years publicly denied the problem existed, and accused human rights groups reporting these killings of helping the guerrillas in a campaign to discredit the military. After a major media scandal in September 2008 over the executions of several young men from Soacha, a low-income neighborhood of Bogotá, Uribe dismissed 27 members of the military, including three generals. There have been several more dismissals since then. But Uribe continues to claim these are isolated cases, emphasizing that there are only “22 proven cases” and charging that there are hundreds of “false allegations.”

Army Commander Mario Montoya, the subject of allegations linking him to abuses and paramilitaries, resigned in November 2008 right after the Soacha scandal. Uribe appointed him as ambassador to the Dominican Republic. Montoya’s replacement and reported protégé, General Oscar Gonzalez Pena, commanded the 4th Brigade of the Army when it had one of the worst records of extrajudicial executions in the country.

The UN Special Rapporteur on Extrajudicial Executions visited Colombia in June 2009. In preliminary findings, he noted that, “the sheer number of cases, their geographic spread, and the diversity of military units implicated, indicate that these killings were carried out in a more or less systematic fashion by significant elements within the military.” He pointed out that the Colombian military justice system contributes to the problem by obstructing the transfer of human rights cases to the ordinary justice system. His final report will address these and other issues, including possible incentives to members of the military that contribute to the killings.

The executions, which the Special Rapporteur described as “cold-blooded, premeditated murder of innocent civilians for profit, stand out as one of the most serious abusive practices by state agents we have documented in Latin America in recent years.” The frequency of the executions and the failure of President Uribe to acknowledge the gravity and scope of the problem, or to institute adequate measures to prevent it, should raise questions about the purposes for which U.S. military aid is being used, and the effectiveness of continued aid. That finding is just five months old.

Aww, shit. That’s it for this week. I can only write about Human Rights Abuse for so long before it begins to wear on my mind. I could go on for another 100 pages but I doubt that you could stand it long enough to read it.

This is a small window on the situation and the people U.S. troops will be in cahoots with as we go forward with the seven new bases the Obama government has signed on to pay for, construct, and occupy.

Next week I will take a look at corruption in the Colombian Military. Maybe I won’t find any. Whadda ya think?

Asi es en Colombia hoy

Female cadets training at the Tolemaida base in Melgar, Colombia. Photo by Fernando Vergara / AP.

Know your new military bases

Melgar is a Colombian town in the Department of Tolima 65 mi. southwest of Bogotá and one hour north of Ibague the capital city of Tolima.

Melgar is located in the Sumapaz River Valley and borders the Department of Cundinamarca and Sumapaz River to the north, town of Icononzo to the east, and the towns of Cunday at the south and Carmen de Apicala to the west.

The town is home to a major military base called Tolemaida Air Base.

Tolemaida Military Fort, in the Nilo région; is at an elevation of 1,617 feet (493 m) above mean sea level, with two runways; 04/22 has an asphalt pavement measuring 9,280 by 96 feet and 04L/22R with a concrete surface measuring 1,431 by 65 feet.

Tolemaida is half way between Bogotá and Medellin. It has taken on a reputation as Colombia’s Abu Ghraib.

The Bogotá daily El Espectador reported on January 8, 2009, that in October, 2008, U.S. military officers and private contractors had overseen a session at the base in which three young girls from a nearby village were tortured and raped.

The sessions were apparently videotaped, and the tapes then distributed in the local village of Melgar, where the girls were from. They were subsequently ostracized and forced to flee the village with their families.

The most disturbing thing about the allegations is that the girls were not even suspected of anything; they had been lured to the base in exchange for money and a promise of visas to enter the U.S., and apparently used in a torture demonstration.

Your tax dollars

As at Larandia and Palanquero there are thousands of troops of all kinds at Tolemaida and Melgar, those listed below are the ones we know of that directly receive U.S. tax dollars from the Department of State and/or the Pentagon.

COLAR Lancero School (ESLAN)
COLAR Professional Soldier School (ESPRO)

Rural Special Forces Brigade (BRFER)

  • 2nd Special Forces BN (BFER1)
  • 2nd Special Forces BN (BFER2)
  • 3rd Special Forces BN (BFER3)
  • 4th Special Forces BN (BFER4)

Rapid Deployment Force (FUDRA)

1st Mobile Brigade (BRM01)

  • 19th Counter Guerrilla BN (BCG19)
  • 20th Counter Guerrilla BN (BCG20)
  • 21st Counter Guerrilla BN (BCG21)
  • 22nd Counter Guerrilla BN (BCG22)
  • 22nd Support and Services Company (CPS22)

2nd Mobile Brigade (BRM02)

  • 15th Counter Guerrilla BN (BCG15)
  • 16th Counter Guerrilla BN (BCG16)
  • 17th Counter Guerrilla BN (BCG17)
  • 18th Counter Guerrilla BN (BCG18)
  • 23rd Support and Services Company (CPS23)

3rd Mobile Brigade (BRM03)

  • 51st Counter Guerrilla BN (BCG51)
  • 52nd Counter Guerrilla BN (BCG52)
  • 53rd Counter Guerrilla BN (BCG53)
  • 54th Counter Guerrilla BN (BCG54)
  • 25th Support and Services Company (CPS25)

Instruction BN Army Aviation School (CERTA)
4th Air Combat Command (CACOM 4)

  • For previous articles by Marion Delgado about the U.S. military presence in Columbia, go here.

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Forced Prostitution in Mexico : Lost Women of the Narcoguerra

Posted on December 3, 2009 by Thorne Dreyer

“Sex Slave” by Vangobot / Pop Art Machine.

Organized crime in Mexico:
Massive transnational sex trade

The networks of traffickers in women use Mexico as a bridge to move teens to the U.S. and Canada where they are sold and sexually exploited.

By Michael Reynolds / The Rag Blog / December 3, 2009

Evangelina Hernandez continues to open windows on the under-reported consequences of the narcoguerra. This time with her chilling investigative piece on Mexican organized crime’s lucrative transnational sex trade and forced prostitution in this morning’s El Universal, “Prostitución forzada, otra cara del yugo a migrantes.”

Hernandez leads with the harrowing account of “Nancy,” a young woman snatched up by traffickers in Chiapas while riding a train carrying migrants north from Guatemala. Her abductors were Los Zetitias, a franchise of the Zetas’ diversified global criminal enterprises.

Hernandez’ telephone interview with Nancy’s brother “Rafael,” details the circumstances of his sister’s brutal saga that began in the Las Anonas Chiapas-Mayab railway station where Nancy was forced into a van and driven north to a safe house where she was beaten and threatened with death unless she participated in a pornographic video in which she was raped by several men.

Rafael told Hernandez that his sister’s kidnappers promised that she would be let go after this “little job.” Instead, said Rafael “the first video was followed by another and another.” Days later the 20 year-old Nancy was taken to a Tijuana brothel and forced into prostitution until she completed a “quota” set by her abductors. Two and half months later she was ordered to call relatives in the U.S. to fork over a ransom for her release. Rafael got the call and agreed to pay.

Without giving details, [Rafael] said that he paid a designated smuggler to move his sister to America, [and] also deposited a large sum of dollars as a “ransom” for her to surrender, but not before being warned that talking would be his death sentence.

Nancy’s sordid ordeal is just one of thousands of such stories. Hernandez provides the alarming facts:

More than 20,000 Central American women are currently prostituted in brothels and bars in south-southeast Mexico, according to End Child Prostitution, Child Pornography and Trafficking of Children for Sexual Purposes (ECPAT).

Women and girls are trafficked under false pretenses to Mexico from Guatemala, Honduras and El Salvador. They sell them in bars for not more than $40 where they are held against their will in a situation of slavery and forced to cover their costs of accommodations, food and drugs, says the Global Report of Actions Against Commercial Sexual Exploitation of Children and Adolescents (ECPAT).

The owners of many of these bars are local politicians, bankers and people with economic power operating from the shadows and earning revenues. The report warns that traffickers are recruiting younger and younger women, mostly girls.

The networks of traffickers in women use Mexico as a bridge to move teens to the U.S. and Canada where they are sold and sexually exploited, according to the World Report on Trafficking in Persons 2009, the United Nations Office on Drugs and Crime (UNODC).

A 2009 American Bar Association report cites 47 organized criminal groups in Mexico that are engaged in sexual and labor exploitation in the Federal District and 17 states including Baja California, Guerrero, Oaxaca, Quintana Roo, Chiapas, Chihuahua, Tlaxcala, Tamaulipas and Jalisco — the first four of these are regarded as “sex tourism” destinations. Mexico’s National Human Rights Commission estimates these sex trafficking networks bring in about $50 million per year.

Hernandez closes her report with Rafael’s disheartening but understandable takeaway from his and his sister’s nightmare.

Doomed to remember

Nancy is not crying, but spends many hours without a word. She paid a high cost to reach her destination.

Her brother Rafael thinks that if one day they go to Guatemala, they will not return on a plane that stops in Mexico.

He fears that criminals will keep their word and kill them. They are never going to complain, because they doubt that the authorities will do anything to stop the rape, kidnappings and murders of women in Central America.

For more of Evangelia Hernandez’ excellent reporting, see her October reports from the US/Mexico border on corruption here, here, and here. They are in Spanish, but are well worth utilizing Google’s translation feature.

[Michael Reynolds, an investigative journalist and author, is a former correspondent for Reuters who has written for Playboy, The Nation, Mother Jones, The Bulletin of the Atomic Scientists, Rolling Stone, High Times, Alternet and other publications. He was senior intelligence analyst with the Intelligence Project of the Southern Poverty Law Center and has served as a consultant on domestic terrorism and transnational security. His blog is NarcoGuerra Times where this article also appears.]

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PRESS / Dick J. Reavis : Texas Tribune Lacks Regional Vision

Posted on December 2, 2009 by Thorne Dreyer

Texas Tribune. Image from UrbanGrounds.

The Texas Tribune:
Bells and whistles but little vision

The Tribune mistakes numbers for people and information for insight. It is in no way culturally or regionally idiosyncratic.

By Dick J. Reavis / The Rag Blog / December 2, 2009

Now a month old, The Texas Tribune has had time to show its stuff. Though it was trumpeted before its debut as the end-all of Texas journalism, as a journalist and a Texan, I find it underwhelming and uninspiring.

The digital publication’s strongest suit is that it’s a video game, with streaming this and archived that, and while it may not be as much fun as Grand Theft Auto IV, it’s certainly more clickable than the web pages of other Texas dailies. It has given us polls on everything electoral, and its pages allow us to permutate percentages. Given that virtue, it may soon surpass the Texas Almanac in popular appeal!

Its chief failure is lack of a regional vision. If it is perhaps an admirable statistical publication about Texas — suitable for use in lobby firms and among campaign strategists — it is a poor publication for those Texans whose pursuits are benign. It has no salsa.

The Trib, for example, has given us surveys that allow us to predict whether the voters of Houston, Dallas, Oatmeal, Seadrift and Levelland, will favor Perry over Hutchinson, yet it doesn’t see the overarching, which is that Texas will within a decade be a Hispanic-majority state. The days of Republican hegemony are passing, and any liberal in Texas — the Trib’s managers claim that they are liberals — should be championing the new order to come.

The state’s future is not reflected in the Trib’s staff, which among its dozen reporters includes only one who is Hispanic-surnamed. That’s because the Trib’s executive parentage is not Texan, but what might be called cívica Americana: its key concepts are from Journalism 101, circa 1960, when “Missourian” meant “American.” It is objective, Anglo and staid. Spanish words and phrases are rare in its pages, and even rarer is the hint that today’s Texas politics are a farce — or an ethnic crime. The Trib’s wonks presume that policy-makers are honest, fair-minded and sincere, yet nobody outside the press believes that today.

In the weeks before its debut, the Trib’s backers predicted that the data it would supply might salvage journalism in the state. But most of our dailies haven’t been worth reading since the Gulf of Tonkin incident, when for months Dallas News stories inveighed against the Vietnamese “Reds,” or since August, 1965, when the San Antonio Express described Watts as a “wild Negro neighborhood.” Texas journalism has to be repeopled and remade, not saved — and doing so requires radically new premises.

I saw the Trib’s failings most clearly in its series on the problems of the border. One of its stories detailed the difficulty people have in traveling from there to the state’s interior, a real problem and one that could be solved by reform. But the border is not merely an area of troublesome transit between two nations. It is, in all its aspects, an unhealed scar from the 19th century mugging of Mexico and its descendants. Our problem is not one of walls and checkpoints, it is that either walls or checkpoints were thinkable. Sooner or later, Texas must Mexicanize, and the Trib is not leading the way.

Nor do I see in its coverage any understanding of the historic angst and feistiness of Anglo Texas. Rick Perry and Kay Bailey Hutchinson appear in the Trib’s pages as conservative political candidates, as if the primaries were to be held in Iowa. Like George W., they are instead avatars of Anglo Texans, people whose prominence should make us worry about out fitness for the future.

The Tribune mistakes numbers for people and information for insight. It is in no way culturally or regionally idiosyncratic. It apparently believes that we know our children by their report cards.

[A native Texan, Dick J. Reavis teaches journalism at North Carolina State University. An award-winning journalist, educator and author, Reavis was active with SDS and the New Left in the Sixties. He wrote for Austin’s underground newspaper, The Rag, and later was a senior editor at Texas Monthly magazine. His book, The Ashes of Waco: An Investigation, about the siege and burning of the Branch Davidian compound, was published by Simon and Schuster and may be the definitive work on the subject.]

Also see:

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Tom Hayden : Time to Strip Off the Obama Sticker

Posted on December 2, 2009 by Thorne Dreyer

Image from Zazzle.com.

Obama’s Afghanistan escalation:
Latest in a string of disappointments

I’ll support Obama down the road against Sarah Palin, Lou Dobbs or any of the pitchfork carriers for the pre-Obama era. But no bumper sticker until the withdrawal strategy is fully carried out.

By Tom Hayden / December 2, 2009

It’s time to strip the Obama sticker off my car.

Obama’s escalation in Afghanistan is the last in a string of disappointments. His flip-flopping acceptance of the military coup in Honduras has squandered the trust of Latin America. His Wall Street bailout leaves the poor, the unemployed, minorities, and college students on their own. And now comes the Afghanistan-Pakistan decision to escalate the stalemate, which risks his domestic agenda, his Democratic base, and possibly even his presidency.

The expediency of his decision was transparent. Satisfy the generals by sending 30,000 more troops. Satisfy the public and peace movement with a timeline for beginning withdrawals of those same troops, with no timeline for completing a withdrawal.

Obama’s timeline for the proposed Afghan military surge mirrors exactly the 18-month Petraeus timeline for the surge in Iraq.

We’ll see. To be clear: I’ll support Obama down the road against Sarah Palin, Lou Dobbs or any of the pitchfork carriers for the pre-Obama era. But no bumper sticker until the withdrawal strategy is fully carried out.

But for now, the fight is on.

This is not like the previous conflict with Bush and Cheney, who were easy to ridicule. Now this orphan of a war has a persuasive advocate, a formidable debater who will be arguing for support from the liberal center — one who wants to win back his Democratic base.

The anti-war movement will have to solidify support from the two-thirds of Democratic voters who so far question this war. Continuing analysis from The Nation and Robert Greenwald’s videos have a major role to play. Public opinion will have to become a growing factor in the mind of Congress, where Rep. Jim McGovern’s resolution favoring an exit strategy has 100 co-sponsors and Rep. Barbara Lee’s tougher bill to prevent funding for escalation is now at 23.

Key political questions in the immediate future are whether Rep. David Obey, chair of the House Appropriations Committee, will oppose Afghanistan funding without a surtax or is only bluffing, and whether Sen. Russ Feingold will step up with legislation for a withdrawal timetable.

Beyond public persuasion and pressuring Congress, activists are sure to be hitting the streets and precincts in the year ahead. The anti-war movement has a certain leverage based on the current doubt in the minds of voters and policy experts, and the potential dissent from within the Obama base. Democratic turnout increased 2.6 percent in 2008 over 2004, while Republican votes dropped by 1.3 percent. Twenty-two million more young people voted in 2008 than in 2004. The unprecedented energies of those young people who volunteered their time, money and hope could drain away by 2012, if not sooner.

In addition, the peace movement will be globalizing its reach as Obama seeks to extract more troop concessions from wary NATO countries. Opposition is particularly strong in the United Kingdom, Canada, Germany and France. When Obama accepts the Nobel Prize in Oslo on December 10, he may address as many as 10,000 protesters.

Adding 30,000 to 35,000 U.S. troops will raise the U.S. death toll by over 1,000 by 2011 on Obama’s watch, in addition to the 750 who died under Bush. The numbers of U.S. wounded are rising faster than ever, with 300 counted in the past three months. Civilian casualties are under-reported according to the UN mission in Afghanistan. The budgetary costs are growing to $75 billion annually, and this could become another trillion-dollar war.

The albatross of the Karzai government will threaten any plans to rapidly expand the Afghan army and police, themselves divided along sectarian lines. In 2005, the Kabul regime ranked 117th on the list compiled by Transparency International; by this year it was 176th.

There are alternatives. There is evidence that the Taliban in Afghanistan are seeking a peace settlement without havens for Al Qaeda. There also is an October 11 statement by Gulbaddin Hekmatyer of Hezb-I-Islam Afghanistan, a mujahadeen leader and former prime minister in the 1990s, once funded by the CIA. Never reported in the US media, the letter proposes an honorable exit strategy, including

  • relocation of Western troops from Afghan cities, plus a logical and practical time schedule for their withdrawal;
  • transfer of power to an interim government independent of the parties currently fighting;
  • new elections under an independent election commission;
  • release of political prisoners;
  • a possible peacekeeping force from neutral Islamic countries;
  • and, more important for the Obama agenda, the document states: Hezb-I-Islami is prepared to discuss the exit of all foreign fighters (non-Afghan, be it forces of the West, or embedded with the Mujahideen). We assure all sides that we agree that neither the embedded fighters with the Mujahideen nor foreign military forces be allowed to remain or to establish military bases or training camps in Afghanistan.

But instead of pursuing an Afghan-based political settlement without havens for Al Qaeda, the U.S. strategy is to pursue the same goal through more bloodshed, leaving Afghanistan somewhere between the Stone Age and ashes. What is obsessive about this approach is the fact that there is no longer an Al Qaeda haven in Afghanistan, which means the U.S. troops are fighting Afghan insurgents in their own country. But if your primary tool is a hammer, as the saying goes, all problems appear to be nails.

The war clearly is shifting to Pakistan, a far more clandestine and dangerous conflict fought by American secret operatives on the ground and drones from the sky. The targets are twofold: (1) to eliminate the Afghan Taliban from their enclave in Quetta instead of negotiating with them, and (2) using U.S. advisors and drones to push Pakistan’s army into a war against Pakistan’s homegrown Taliban and other insurgents now in the tribal areas, impoverished and unrepresented in Pakistan’s institutions.

This approach so far has caused a sharp expansion of violent attacks and suicide bombings across the region. The fear of a destabilized Pakistan with scores of nuclear weapons may lead Obama’s advisors to soon present the president with a more apocalyptic scenario than anything so far, if they have not already.

[Tom Hayden, a former California state senator, was a leader in the Sixties New Left and was a founder of Progressives for Obama. He is the author, most recently, of The Long Sixties: From 1960 to Barack Obama (Paradigm).]

Source / The Nation

Thanks to Carl Davidson / The Rag Blog

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The War President : Barack Obama at West Point

Posted on December 2, 2009 by Thorne Dreyer

President Barack Obama announces his escalation of the War in Afghanistan at the US Military Academy at West Point, N.Y., on Tuesday night. Photo by Charles Dharapak / AP.

The War President at West Point:
Great speech, bad message

By Ted McLaughlin / The Rag Blog / December 2, 2009

Last night, President Obama spoke to the nation about the continuing occupation of and war in Afghanistan. As usual, he gave a great speech. He continually proves himself to be one of our country’s finest public speakers. Unfortunately, underneath the rhetorical excellence there was little that made much sense.

I should have known it would be like that, because he opened by talking about Iraq as though that conflict was over and great things had been accomplished there. But that is not the reality. The killings continue there, and the government can’t even agree on a new election law and therefore can’t hold scheduled elections. Our troops still have at least two remaining years in that country and possibly even longer. Success, whatever that is, is still a long way from being a reality in Iraq.

The president has now decided that all we need to succeed in Afghanistan is another 30,000 troops. He believes this will allow us to stop Taliban advances, pacify the countryside and eliminate al-Queda. It seems he has become a master of wishful thinking.

While the troop surge may temporarily halt further advances by the Taliban, it is not nearly enough to pacify the country outside of urban areas (and I suspect bombings will continue even in the urban areas). The fact is that once you get outside of Kabul, the people simply don’t like or trust the central government.

And training more Afghan troops that answer to the central government will not solve that problem. President Karzai has proven himself to be a corrupt leader who’s reelection was obtained through massive fraud. In addition, his brother is the largest opium poppy grower and dealer in the country.

We are in the process of making the same mistake in Afghanistan that we made in Vietnam. We are supporting a corrupt leader and trying to convince the people, or force them, to also support that leader. It didn’t work in Vietnam, and it won’t work in Afghanistan. Just because a foreign leader is friendly to the U.S. and its goals, does not mean he is worthy of or capable of winning the people’s support.

Then we come to the matter of al-Queda. A troop surge of 30,000 will do nothing to eliminate al-Queda. They are snugly entrenched in Pakistan and our troops cannot even enter that country. To truly eliminate al-Queda and the Taliban, we would need to not only occupy Afghanistan, but also invade Pakistan. That is neither militarily nor diplomatically possible.

The only bit of good news from the president last night was when he said our involvement in Afghanistan was not an open-ended one. He expects the central government there, as weak and corrupt as it is, to be able to take over the fight on their own in about a year and a half. He wants to begin withdrawing troops in the summer of 2011.

But note he said “begin” to withdraw. He gave no assurance that our troops would be out of Afghanistan in 2011. He also didn’t tell us what would happen if the situation wasn’t any better by the summer of 2011. Would there be another troop surge and another “deadline”?

I’m afraid we’re still in the middle of quagmires in both Iraq and Afghanistan, and sending more troops to either will not solve the problem. We should have learned in Vietnam, that it’s almost impossible to win a guerrilla war in someone else’s country.

Since we haven’t yet learned that lesson, we are now doomed to a repeat of history (and more dead American soldiers).

[Rag Blog contributor Ted McLaughlin also posts at jobsanger.]

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Obama and Afghanistan : The Permanent War Economy

Posted on December 1, 2009 by Thorne Dreyer

Imperialism (War Economy), by Jolan Gross Bettelheim, lithograph, c.1940.

Obama on Afghanistan:
He cannot believe what he is saying

By Harry Targ / The Rag Blog / December 1, 2009

After a 1966 presentation by Dean Rusk before the Senate Foreign Relations Committee, Senator Clifford Case of New Jersey commented about the Secretary of State that he could not have believed what he had just said about Vietnam. I thought of Case’s comments the other day after hearing that President Obama was going to announce the sending of 30,000 more troops to Afghanistan with a cost of $40 billion.

The President is a smart man. He knows that the demonic image of Al Qaeda as a worldwide threat to the United States is about as accurate as the old story about the threat of international communism during the Cold War. He has to know that the Taliban and Al Qaeda have their own separate agendas. He has to understand that the Taliban have been motivated by two concerns: corrupt local government and foreign occupation of their country.

Further, he has got to know that these foreign forces cannot subdue or defeat the Taliban in their own country because the population prefers them to the foreigners who are killing civilians and destroying what survives of their desperately poor country.

The President knows that his predecessor gained worldwide condemnation for ignoring the traditional international relations tool of diplomacy. He has to see that countries in the region and those that share common cultures, languages, and religions are more likely to be able to defuse conflicts than the Christian superpower from North America.

Yes indeed, the President is a smart man. He knows that military spokespersons have always proposed exaggerated battle plans guaranteeing such favorable results as defeating indigenous enemies and strengthening friendly governments while enhancing the security of the United States. And most of all, Obama has to know what the Vietnam War did to the United States.

The permanent war economy

If he knows all these things why is the president going to expand U.S. military operations in Afghanistan? The answer to the question has its roots in the formation of the permanent war economy. The PWE was constructed during World War II as government, the corporate sector, and the military mobilized to defeat fascist armies in Europe and Asia. While others demobilized after the war (or were forced to do so), the United States launched a several trillion dollar program to build the largest war machine in world history.

As economist Ismael Hossein-zadeh reported, military spending has been the second largest item in the federal budget behind social security, which is really a self-financed fund. Quoting from William Hartung, U.S. military spending in 2008 was greater than the rest of the world combined and 30 times greater than all State Department operations. Military programs constituted over 50 percent of all discretionary spending.

Pollin and Garret-Peltier added that military spending rose from three percent to 4.3 percent of the GDP during the Bush years. In 2008, military spending in excess of $600 billion created approximately five million jobs, both military and defense industry related. As Seymour Melman documented years ago, military spending meant funding a huge bureaucracy, contracts for the defense industry, and sub-contracts for manufacturers that produce goods that find their way into weapons systems. Nowadays spending includes private armies, security forces, civilian contracted services for the military, homeland security programs, large grants to major research universities, and many more activities funded and related to military missions.

Of course, military spending is never justified in narrow institutional terms but rather in terms of grand projects and campaigns; fighting communism, combating terrorism, or checking drug smuggling. These campaigns are presented as almost timeless. For example, Tom Hayden has alerted us to the doctrine of the “long war” quoting a counter-insurgency strategist who in 2004 wrote that “there is a growing realization that the most likely conflicts of the next 50 years will be irregular warfare in an ‘Arc of Instability’ that encompasses much of the greater Middle East and parts of Africa and Central and South Asia.”

These campaigns are reinforced by the general proposition embedded in our political culture that there always has been war and there will always be war. Generals and media pundits from time to time comment on the need for this or that weapon system “for the next war.” The scourge of war will always be with us.

Threats to the primacy of the permanent war economy

Debate about military missions today comes in the context of deep economic crisis and growing demands for scarce societal resources. Banks had to be bailed out. One in eight Americans are on food stamps. Health care needs to be reformed. Millions of people need jobs. Logic would suggest cutting back on military spending particularly since Pollin and Garrett-Peltier have shown once again that each billion in government expenditures for education would create almost three times more jobs than military spending. In fact, government investment in every civilian activity generates more jobs than investment in the military.

The newly released Economic Policy Institute “American Jobs Plan” includes a proposal for a $40 billion per year allocation of government funds to create one million public service jobs. The cost of this aspect of the EPI jobs program could be paid for with funds that will be going to expanding the war in Afghanistan instead.

So when we ask ourselves why military operations in Afghanistan will be expanded the answer seems clear. First, the military constitutes the largest organized, armed, and funded institution in American society. In today’s political economy it stands shoulder to shoulder with Wall Street as a source of almost unstoppable resistance to change. Second, military largesse trickles down throughout the society affecting manufacturing, scientific research, education, private armies, spy operations, and myriad other activities.

Third, Pentagon elites see the danger of this new administration reallocating spending to meet the needs of a crisis-ridden economy: health care, jobs, education, and transportation (it is interesting to note that Senators Lugar and Graham already have called for shelving health care reform until the battle in Afghanistan has been won). Finally, military institutional interests demanding increasing shares of government money use in their advocacy for expanding wars playing upon the deeply embedded war-proneness of American culture.

What are the consequences of this analysis for peace? One conclusion is that grassroots activists must take on the permanent war economy. It has been an enduring feature of American foreign and domestic policy since the end of World War II. The wastefulness of military spending, the folly of claims made justifying each and every war, and the war culture must be challenged. In addition, peace and justice movements must show clearly that every dollar that is allocated for the military is a dollar that is not used to sustain life, create jobs, promote education, and provide for health care.

[Harry Tarq is a professor in American Studies who lives in West Lafayette, Indiana. He blogs at Diary of a Heartland Radical, where this article also appears.]

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