Tuesday, October 31, 2006

Another Recession "Canary in the Mine": Wal-Mart Sales Flat in Spite of Lower Oil Prices - Nouriel Roubini

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Reading Nouriel Roubini is just the thing to send you off to work whistling like one of Snow White's dwarfs, isn't he? DS

Abstract: A 0.5% year-on-year sales growth means a negative real growth rate of sales of about 3% given the level of US inflation. So, Wal-Mart sales are collapsing in real terms and in nominal terms they are growing as slowly as they did at the beginning of the 2001 recession, an ominous sign as Wal-Mart sales are a clear leading indicator of economic activity. So, why arent Wal-Mart customers rushing to buy at Wal-Mart now that gasoline prices are way down relative to the summer? The non-sense argument - that lower oil that is only back to the very high levels it had before the summer spike will rescue the US consumer - is now faltering. With housing being in a total meltdown (the other nonsense of a housing market "bottoming out" has absolutely no base either) and the effects of the Fed tightening in the pipeline, you have a consumer buffeted by mediocre real wage growth (most of the alleged increase in incomes is that of the very rich who get the bonuses and stock option, not the median worker who is squeezed), slumping employment growth (51K jobs in September), negative savings, high debt ratios, falling housing wealth, rising debt servicing ratios. So, the argument that still high (but lower than summer peak) gasoline prices will rescue the US consumer is proving to be a myth.(...) So, where is the basis of the Q4 rebound in growth that is becoming the new mantra of all soft-landing optimists? The simple answer is that this alleged Q4 rebound has, so far, little economic data to back it up. It is increasingly clear that Q4 growth looks very likely be worse than Q3 based on the flow of incoming macro data: softening consumption, even worse housing contraction, slowing non-residential investment, signals of a slowdown in corporate investment, falling auto production, inventories adjustment after two quarters of excessive increase in unsold inventories, faltering consumer durables demand. It all adds up to a growth rate in Q4 that is closer to zero than to 1%. READ MORE

Global Warming... The Little Blair that Cried 'Wolf'

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What could be more indicative of the state of world opinion then the muted reactions to Tony Blair, supported by the best science, announcing the apocalypse? Blair suggests that global warming could shrink the world's economy by up to 20%, costing it more than either of the 20th century's world wars or the Depression. The problem is now that when Tony Blair says that the climate is warming up dangerously, the first reaction most people have is to get their fur coat out of mothballs and to wax their skis. That is really the most damaging result of the war in Iraq. After all the lies and wasted lives and treasure, you announce the end of the world and people just yawn. DS

IDF worried Hamas may build anti-tank division - Haaretz

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Here is the next crisis or the crisis after next. Israel is literally in political meltdown and for sure something nasty is going to happen soon. They have to do something, anything to rustle up a little "shock and awe". DS

IDF worried Hamas may build anti-tank division - Haaretz

Hamas could feasibly establish a military division of some 10,000 soldiers with an operational force similar to Hezbollah's if it continues to strengthen at its current pace, Israel Defense Forces GOC Southern Command Yoav Glant said Tuesday.

Meanwhile, Prime Minister Ehud Olmert will convene his political-security cabinet on Wednesday to discuss the IDF's policy in the Gaza Strip and work out responses to ongoing incidents of Palestinian Qassam fire and arms smuggling.

Sources said no decisions would be made on expanding the IDF's current operation until Olmert's return from the United States in two weeks.

Glant told the Knesset Foreign Affairs and Defense Committee that Hamas could bolster its forces to include anti-tank divisions and commandos, and could gain access to advanced weapons systems as well as night-vision apparatus.

The IDF is preparing to weaken Hamas' efforts, but the plan must first be approved at the political level, Glant said. Hamas is currently in its first phase of force building and does not yet have these advanced capabilities or a hierarchical system of divisions and brigades, he said.

The southern command chief said that the IDF's current operations in and around the Gaza Strip are mainly defensive, aimed at quelling any immediate threats posed to Israeli citizens from Qassam rockets and terror organizations. He emphasized that that the army was awaiting goverment approval before operating to weaken Hamas' plans for bolstering its forces.

Delegates to the meeting on Monday said that the picture drawn for them by Major Glant was worrisome. MK Effi Eitam (National Union - NRP) said, "IDF is busy with routine security measures in the Gaza Strip, and is not dealing with strategic problems," adding that militants in Gaza have been smuggling military-grade weapons through hundreds of tunnels.

Defense sources said that Defense Minister Amir Peretz and IDF Chief of Staff Dan Halutz approved on Sunday a series of new operations to be carried out in the Gaza Strip in the coming days, though the extent of the operations does not differ from its current actions.

William E. Odom: How to cut and run - Los Angeles Times

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Odom's recipes make sense... The only thing he leaves out is bringing to trial and imprisoning (I'm against the death penalty) the men and women responsible for what is without exaggeration the greatest disaster in US history. DS

Abstract: The United States upset the regional balance in the Middle East when it invaded Iraq. Restoring it requires bold initiatives, but "cutting and running" must precede them all. Only a complete withdrawal of all U.S. troops — within six months and with no preconditions — can break the paralysis that now enfeebles our diplomacy. And the greatest obstacles to cutting and running are the psychological inhibitions of our leaders and the public. Our leaders do not act because their reputations are at stake. The public does not force them to act because it is blinded by the president's conjured set of illusions: that we are reducing terrorism by fighting in Iraq; creating democracy there; preventing the spread of nuclear weapons; making Israel more secure; not allowing our fallen soldiers to have died in vain; and others. But reality can no longer be avoided. It is beyond U.S. power to prevent bloody sectarian violence in Iraq, the growing influence of Iran throughout the region, the probable spread of Sunni-Shiite strife to neighboring Arab states, the eventual rise to power of the anti-American cleric Muqtada Sadr or some other anti-American leader in Baghdad, and the spread of instability beyond Iraq. All of these things and more became unavoidable the day that U.S. forces invaded. These realities get worse every day that our forces remain in Iraq. They can't be wished away by clever diplomacy or by leaving our forces in Iraq for several more years.(...) the U.S. must informally cooperate with Iran in areas of shared interests. Nothing else could so improve our position in the Middle East. The price for success will include dropping U.S. resistance to Iran's nuclear weapons program. This will be as distasteful for U.S. leaders as cutting and running, but it is no less essential. That's because we do share vital common interests with Iran. We both want to defeat Al Qaeda and the Taliban (Iran hates both). We both want stability in Iraq (Iran will have influence over the Shiite Iraqi south regardless of what we do, but neither Washington nor Tehran want chaos). And we can help each other when it comes to oil: Iran needs our technology to produce more oil, and we simply need more oil. Accepting Iran's nuclear weapons is a small price to pay for the likely benefits. Moreover, its nuclear program will proceed whether we like it or not. Accepting it might well soften Iran's support for Hezbollah, and it will definitely undercut Russia's pernicious influence with Tehran. Fourth, real progress must be made on the Palestinian issue as a foundation for Middle East peace. The invasion of Iraq and the U.S. tilt toward Israel have dangerously reduced Washington's power to broker peace or to guarantee Israel's security. We now need Europe's help. And good relations with Iran would help dramatically.

Steve Bell in the Guardian

Monday, October 30, 2006

US-Led Military Thrust Focuses Heavily on Broad Naval Deployment - Debka

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Debka is a very rightwing Israeli website with what appears to be privileged access to Israeli intelligence sources. It seems to either tell the truth or to tell the reader what Israeli intelligence would like her to believe is the truth. The naval build up described here is verifiable, the only question is its intention. Is this the "October Surprise"? Will there be an attack on Iran in a desperate attempt to save the election for the Republicans? There is certainly no question by now that they are perfectly capable of something like that. DS

Abstract: Hundreds of US and allied war ships foregathered in the strategic seas of the Middle East and India in the last days of October 2006 for two primary missions: To prepare for a US-led military strike against Iran which has stepped up its uranium enrichment program with a second centrifuge project - undeterred by the prospect of UN sanctions; and measures to fend off palpable al Qaeda threats to oil targets.(...) American, Italy, France, Britain, Australia, Bahrain, Qatar, the United Arab Emirates and Kuwait are taking part in an exercise practicing the interception of ships carrying nuclear materials or components for use in advanced weapons. The exercise opposite Bahrain is the first to be held in the Persian Gulf under the three-year old proliferation security initiative. It applications could be translated equally into the enforcement of sanctions against North Korea, which conducted its first nuclear test on Oct. 9, or Iran. On Oct. 27, Robert Joseph, the US undersecretary of state for arms control remarked: “From Iranian news reports we know the exercise got the attention of Iran.” But rather than climbing down, Tehran referred two days later to the war games as “adventurous” and placed its armed forces on a high alert which encompassed the joint naval units of the military and Revolutionary Guards in the Persian Gulf, while the Revolutionary Guards, the Iranian army, navy and air force were placed on “yellow” alert, one level short of full war. READ MORE

Hertzberg: Hearts and Brains - New Yorker

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For an American to accept the idea that the very structure of America's democratic process itself could be seriously flawed is to take a huge step into the unknown. It may be, however, that a massive shift in public opinion will not have a massive effect on the election results and that the system was designed with precisely that end in mind. DS

Abstract: The great bafflement of next week’s midterm congressional elections is that there is even a sliver of a hint of a shadow of a doubt about the outcome. The polls are unequivocal. In a mid-October NBC/Wall Street Journal survey, the public’s “job approval” of the Republican Congress stood at a wan sixteen per cent, as against seventy-five per cent disapproving. Another measurement normally regarded as electorally predictive, the one pollsters call “right track/wrong track,” is nearly as one-sided. In last week’s Newsweek survey, twenty-five per cent of respondents pronounced themselves satisfied with “the way things are going in the United States at this time,” while sixty-seven per cent registered dissatisfaction. The Newsweek poll also found that, by a 55-37 margin, likely voters generically prefer Democratic candidates for the House of Representatives to Republican ones. Those numbers are a near-mirror image of the same survey’s job rating for President Bush: thirty-five per cent approve of his performance, fifty-seven per cent disapprove of it. There’s a lively debate among historians over the question of whether the record of the forty-third President, compiled with the indispensable help of a complaisant Congress, is the worst in American history or merely the worst of the sixteen who managed to make it into (if not out of) a second full term. That the record is appalling is by now beyond serious dispute.(...) In a normal democracy, given the state of public opinion and the record of the incumbent government, it would be taken for granted that come next Tuesday the ruling party would be turned out. But, for reasons that have less to do with the wizardry of Karl Rove than with the structural biases of America’s electoral machinery, Democrats enter every race carrying a bag of sand. The Senate’s fifty-five Republicans represent fewer Americans than do its forty-five Democrats. On the House side, Democratic candidates have won a higher proportion of the average district vote than Republicans in four of the five biennial elections since 1994, but—thanks to a combination of gerrymandering and demo-graphics—Republicans remain in the majority. To win back the House, Democrats need something close to a landslide. Their opponents, to judge from their behavior, seem to think they might get one. READ MORE

Globalization anxiety - Lawrence H. Summers - Los Angeles Times

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What we call "democracy" in the developed world is basically the political expression of a huge and satisfied middle class. If this middle class is made unsatisfied by the economy failing to provide for them, either the economy will change or democracy will implode. DS

Abstract: Against all odds, we are living in a time of plenty.(...) one might have expected this to be a moment of particularly great enthusiasm and widespread support for free markets and for global integration. Yet, in many corners of the globe, there is growing disillusion with the market system and global integration. From the failure to complete the Doha round of global trade talks to pervasive Wal-Mart bashing, from massive renationalization in Russia to the increasing success of populists in Latin American and Eastern European politics, we see a degree of anxiety about the market system that is unmatched since the fall of the Berlin Wall and probably well before. Why is there such disillusionment? No doubt particular factors in individual countries enter into the equation. Some anti-globalization sentiment stems from opposition to the Bush administration's foreign policy misadventures. But there is a much more fundamental and troubling source of resistance: the growing recognition that the vast global middle is not sharing the benefits of the current period of economic growth — that, in fact, its share of the pie is not growing and may even be shrinking. John Kenneth Galbraith was right when he observed: "All of the great leaders have had one characteristic in common. It was the willingness to confront unequivocally the major anxiety of their people in their time. This, and not much else, is the essence of leadership." Meeting the needs of the anxious global middle is the economic challenge of our time.(...) Low-cost labor — ordinary, middle-class workers and their employers, whether they live in the American Midwest, Germany's Ruhr Valley, Latin America or Eastern Europe — are left out. This is the essential reason why median family incomes lag far below productivity growth in the United States, why average family incomes in Mexico have barely grown in the 13 years since NAFTA passed and why middle-income countries without natural resources struggle to define an area of comparative advantage. It is this vast group — which lacks the capital to benefit from globalization and cannot imagine competing on cost with Chinese workers — that is desperately seeking either reassurance about the shrinking world or a change in course. And yet, without its support, it is very doubtful that the existing global economic order can be maintained. The twin arguments that globalization is inevitable and protectionism is counterproductive for almost everyone have the great virtue of being correct — but they do not provide much consolation for the losers. Economists rightly emphasize that trade, like other forms of progress, makes everyone richer by enabling people to buy goods at lower prices. But this opportunity offers small solace to those who fear that their jobs will vanish. Nor can education be a complete answer at a time when skilled computer programmers in India are paid less than $2,000 a month. More can be done to strengthen protections for displaced workers. But such an approach is inevitably reactive and defensive. In the United States, and perhaps beyond, the political pendulum is swinging left. The best parts of the progressive tradition do not oppose the market system; they improve on the outcomes it naturally produces. That is what we need today. READ MORE

Avigdor Lieberman: Haaretz and Raimondo

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Israel, which is joined to the United States at the hip, is close to political meltdown. The president is accused of being a serial rapist, the prime minister is under investigation for fraud, they've just lost a war and now they have included one of the most dangerous fascists in the world, since the death of Slobodan Milosevic, in their government as minister in charge of "strategic threats"... (war with Iran). If you think this won't flavor American political discourse in the future then you live under a rock. DS

Abstract: (Let's hear it for the Haiders - Eldar- Haaretz) The prevalent comparison between Avigdor Lieberman and Joerg Haider does an injustice to the Austrian nationalist whose party joined the government in the winter of 2000. Haider is far from being a righteous man, but even in his most fascist days, he never called on Austria to rid itself of citizens who'd been living in the country for generations. Also, Haider never suggested standing up legislators representing these citizens in front of a firing squad. Natan Meron, at the time Israel's ambassador to Austria, noted that once the leader of the Freedom Party joined politics, he never uttered a single anti-Semitic statement. Meron emphasized that the leader of the Freedom Party "does not threaten the Jews."(...) There is also no comparison between the response of the Austrian people to the inclusion of the Freedom Party in the coalition, and the tranquility with which the majority of the Israeli public has received Lieberman's appointment as deputy prime minister in charge of the most sensitive strategic issue. It is important to note that Haider himself stayed out of the government. In Israel, "peacemakers" like Amir Peretz, Ephraim Sneh, Eitan Cabel and Yitzhak Herzog went out of their way in their efforts to convince members of their party's central committee to allow them to bring into their home an extreme nationalist. Shimon Peres, the Nobel Peace Prize laureate, warned Austria at the time that the inclusion of Haider in the coalition will "ostracize it from the family of nations."(...) then-prime minister Ehud Barak declared that Haider was persona non grata in Israel. Jewish organizations the world over competed over the intensity of their criticism of the Austrian government.(...) What will we say if European Union countries announce that the deputy prime minister is an unwanted personality in Europe? The silence of the leadership of mainstream Jewry in the world, in view of the legitimization of a person such as Lieberman, undermines the moral high ground they hold in the struggle against Israel-haters throughout the world. If a Jewish politician who aspires to transfer an Arab minority across the border can sit in an Israeli cabinet, why should an anti-Semite not sit in an Austrian government? Let's hear it for the Haiders. (A Jewish Hitler? - Justin Raimondo) With the entry of Avigdor Lieberman into the government as deputy minister for "strategic threats" – essentially in charge of preparing for war with Iran – Israel makes a qualitative step toward a regime that increasingly resembles, in all its essentials, a rogue state, and, I might add, potentially a very dangerous one.(...) the line that separated Lieberman, the Jewish equivalent of David Duke, from the Israeli "mainstream" has been increasingly hard to discern for quite some time. As Arthur Neslen put it in the Guardian recently: "The most worrying thing about Lieberman is not that his ideas exist on a plane outside Israel's political continuum but that, in many ways, they are close to its dead center. The proposal to transfer 'the triangle,' an area around Um al-Fahm where 250,000 Palestinian citizens of Israel currently live, was first brought into the press spotlight at the end of 2000 at Israel's most prestigious annual policy-making forum, the Herzliya conference. "The then prime minister Ariel Sharon publicly floated the idea again in February 2004. Opposition from Washington to a de facto violation of international law reportedly took the plan out of the headlines, but it remained in the comment pages. "In December 2005, Uzi Arad, a former Mossad director, government foreign policy adviser and current head of the Institute for Policy and Strategy, which organizes the Herzliya conference, resurrected the idea in an article for [The]New Republic." I have covered the growing influence of Israeli extremism for years, and worried over the rise of what seems, at first, a hopeless oxymoron: Jewish fascism. That an ideology that has proved so harmful – indeed, near fatal – to the Jewish people should gain a foothold in the Jewish state seems too bizarre even for a post-9/11 reality that increasingly resembles Bizarro World. Yet here we are, confronted with the specter of Avigdor Lieberman, the would-be Hitler, currently the second most popular politician in the running for prime minister, right behind Benjamin Netanyahu.

Paul Krugman: Bursting Bubble Blues - New York Times

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The US dollar, which is the universal measure of value, could be compared to a house delicately balanced on the edge of a cliff... Just running to the kitchen for ice could send the whole thing plunging into the abyss. The bursting of the US housing bubble could set off a chain of events that could shake the world. DS

Abstract: Over the last few years, ... the housing boom became a bubble, fueled by a surge of irresponsible bank lending, which continues even now. ... The question now is how much pain the bursting bubble will inflict. Last week’s report on G.D.P. showed the first signs of serious economic damage. According to the “advance” estimates (which are often subject to major revisions), growth in the third quarter of 2006 slowed to its worst level since early 2003. A plunge in spending on residential construction, which fell at an annual rate of 17 percent, was the main culprit. ... Some say the worst is already over. Mr. Greenspan, who’s been an optimist all the way, now argues that the latest data on new-home sales and mortgage applications suggest that housing has already bottomed out. Business investment is still growing briskly, and so far consumers haven’t cut their spending. So maybe this is as bad as it gets. But I think the pessimists have a stronger case. There’s a lot of evidence that home prices, although they’ve started to decline, are still way out of line. Spending on home construction remains abnormally high as a percentage of G.D.P., because banks are still lending freely in spite of rapidly rising foreclosure rates. This means that home sales probably still have a long way to fall. ... Moreover, much of the good news in the latest economic report is unsustainable at best, suspect at worst. Almost half of last quarter’s estimated growth was the result of a reported surge in automobile output, which some observers think was a statistical illusion... So this is probably just the beginning. ... READ MORE

Sunday, October 29, 2006

Barack Obama

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I've read Barack Obama's book and I think he is a very interesting and valuable man. Who knows, someday he might make a truly fine president, but I think that, for the moment, he is much too inexperienced for the job.

We would go from having a bad human being, a dumb man, an unqualified president to having a brilliant, possibly good human being and also unqualified president. I think Barak Obama is too interesting and too valuable a national resource to be squandered frivolously... even as Al Gore's vice-president. In 10 or 15 years he might be great. DS

Iran sounds an awful lot like Iraq - Los Angeles Times

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Just because the Iraq war was a stupid idea that has gone terribly wrong doesn't mean that the system that produced that stupid idea isn't capable of producing an endless stream of even more stupid ideas. War with Iran is NOT, repeat NOT "off the table"... not for a minute. DS

Abstract: An embattled president, a Congress distracted by a sex scandal, looming midterm elections — and yet overwhelming agreement, with scant debate or publicity, on fateful legislation that set the nation on a path to war. It happened eight autumns ago, when three-quarters of the House of Representatives and every single senator voted for regime change in Iraq. Has it happened again, on Iran? Four weeks ago, Congress enacted and President Bush signed the Iran Freedom Support Act, a resolution very much in the spirit of the 1998 Iraq Liberation Act. It mandates sanctions against any country aiding Iran's nuclear programs, even those to which that country is legally entitled under the Nuclear Nonproliferation Treaty. The new law got virtually no coverage in the congressional rush to adjourn and amid the controversy surrounding e-mails between Rep. Mark Foley (R-Fla.) and teenage boys serving in the House page program. (...) But if the confrontation over Iran's alleged nuclear weapons program ends in war — initiated by this administration or the next — you can bet this law will be cited as proof that Congress was onboard all along. The congressional action isn't the only sign of déjà vu. Recent months have seen the creation of an "Iran directorate" at the Pentagon, using some of the same personnel as the Office of Special Plans, the shadowy Pentagon outfit led by former Undersecretary of Defense for Policy Douglas J. Feith that was accused of massaging raw intelligence on Iraq to make the case for war look far more solid than in fact it was. Iran has now supplanted Iraq as the greatest single threat to the United States, according to the National Security Strategy released earlier this year. Articles in the New Yorker and Time describe an accelerated rate of contingency military planning in an environment in which many senior officials — on the military and civilian sides — consider war with Iran more a question of when rather than if.(...) Once again, U.S. officials are discounting the work of U.N. weapons inspectors on site, and, once again, those inspectors — and the agencies for which they work — are saying that the best way to contain the nuclear threat is to keep them in place. "People confuse knowledge, industrial capacity and intention," Mohamed ElBaradei, director of the International Atomic Energy Agency, told Newsweek magazine in an interview last week. "A lot of what you see about Iran right now is assessment of intentions."(...) In 1998, the Clinton administration went along with the Iraq Liberation Act reluctantly, fearing that the law's stark anti-Saddam Hussein line would tie its hands. Republican leaders were demanding a tough line, and Democrats, facing midterm elections in the shadow of President Clinton's pending impeachment, were eager to go along.(...) Smart politics? Most Republicans and most Democrats appear to believe that it is — that it's a good idea to take Iran off the table, to make sure it doesn't figure as an issue in the Nov. 7 elections. It's reminiscent of the decision many of them made before the midterms in 1998 and again in 2002, when the bipartisan vote authorizing use of force against Iraq made the looming war almost a nonissue in that year's midterm elections. Maybe this time, on Iran, someone will yet decide that it's worth taking the debate to the people. READ MORE

Halloween - El Roto - El País - Madrid

Andrés Rabago, El Roto of El País, is one of Europe's most original political cartoonists. This is a sample of his work that many Americans will understand. DS

Taliban plan to fight through winter to throttle Kabul - Observer

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Obviously NATO is facing a classic "people's war" moving into its final phase. There was a window of opportunity for the US and its allies to stabilize the situation and help the people of that country, (the word "win" is frivolous in Afghanistan's tragic context) , but I'm afraid that window has closed. DS

Abstract: The Taliban are planning a major winter offensive combining their diverse factions in a push on the Afghan capital, Kabul, intelligence analysts and sources among the militia have revealed. The thrust will involve a concerted attempt to take control of surrounding provinces, a bid to cut the key commercial highway linking the capital with the eastern city of Jalalabad, and operations designed to tie down British and other Nato troops in the south.(...) 'They have major attacks planned all the way through to the spring and are quite happy for their enemy to know it,' a Pakistan-based source close to the militia told The Observer. 'There will be no winter pause.' The Taliban's fugitive leader, Mullah Omar, yesterday rejected overtures for peace talks from President Hamid Karzai and said it intended to try him in an Islamic court for the 'massacre' of Afghan civilians. Since their resurgence earlier this year the Taliban have made steady progress towards Kabul from their heartland in the south-east around Kandahar, establishing a presence in Ghazni province an hour's drive from the suburbs. They do not expect to capture the capital but aim to continue destabilising the increasingly fragile Karzai government and influence Western public opinion to force a withdrawal of troops. 'The aim is clear,' said the source. 'Force the international representatives of the crusader Zionist alliance out, and finish with their puppet government.' A winter offensive breaks with tradition. 'Usually all Afghans do in the winter is try and stay warm,' said a Western military intelligence specialist in Kabul. 'The coming months are likely to see intense fighting, suicide bombings and unmanned roadside bombs. That is a measure of how much the Taliban have changed.'(...) In the south, the Taliban's strategy has been influenced by the doctrine of Pakistani spymasters who ran the insurgent war against the Russians in the 1980s. 'The idea then was to keep Afghanistan just below boiling point,' said one Pakistan-based veteran of the 'jihad' against Moscow's troops. 'The Taliban don't want an apocalyptic explosion of violence. They want a steady draining of the West's resources, will and patience.' The Pakistani influence on the Taliban strategy does not surprise many observers. Senior Nato officials speak privately about 'major Taliban infrastructure' in the neighbouring country but Western military intelligence analysis has consistently underestimated the group's depth and breadth - it can almost be considered the army of an unofficial state lying across the Afghan-Pakistani frontier that has no formal borders but is bound together by ethnic, linguistic, ideological and political ties. READ MORE

Saturday, October 28, 2006

Michael Kinsley: The electoral end of piety - Guardian

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The election appears to heading toward a referendum on the Republican party. I wouldn't get my hopes up too far though, as with gerrymandering and electronic voting equipment this could end up as a horrible brawl the day after. Stay tuned. DS

Abstract: One of the axioms of democratic piety in the US is that you vote for the person, not the party. People love to say, "I evaluate each candidate on his or her own merits" - even when it's not true. A related form of democratic piety is to refrain from voting at all if you know little or nothing about the candidates. But this year does seem to be different. You hear people say - though rarely as forthrightly as the Times - that they are voting for the party, not the person. Well, more accurately, they say they are voting against the party, not the person. The Republican candidate for the Senate or House may be saintlike in general, no worse than muddled on the war in Iraq, and good on stem-cell research. Meanwhile the Democrat may be a grotesque hack just inches from indictment, whose views on Iraq are equally muddled with less excuse (since loyalty to the president is not a factor). Nevertheless, many people are voting for the Democrat simply out of anger at or frustration with the Republican party. The pious view is mistaken. There is nothing wrong with voting for the party, not the person. In other democracies, such as Britain, this person-not-the-party piety is unknown and would be hard to comprehend. A candidate for parliament runs on a party platform promising various things, and if that party wins a majority of seats it "forms a government". You would be silly to vote for the person and not the party. The party's views are what counts. The person's own views are almost irrelevant. Even under the American arrangement there is nothing ignoble about voting the party line. It is an efficient way to minimise your information costs. Voting is an irrational act: your vote does not matter unless it's a tie. And even 2000 was not a tie. The more effort you put into learning about the candidates, the more irrational voting becomes, and the more likely you are not to bother. A candidate's party affiliation doesn't tell you everything you would like to know, but it tells you something. In fact it tells you a lot - enough so that it makes sense to vote for your party preference even when you know nothing else about a candidate. Or even to vote for a candidate that you actively dislike.

The language of war gets a makeover - Christian Science Monitor

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Americans have probably taken the art of the euphemism higher than any other people in the history of humanity. Plain speech is as or more horrible for us than it is even for the Japanese. DS

Abstract: "Stay the course" was a presidential favorite until it began to sound a little absurd, and now it has been withdrawn from the verbal fray. Another White House favorite, "tactical," is still in the running, but it is hard to say for how long. At a news conference last month, President Bush said, "The enemy is changing tactics, and we're adapting." Last week, White House spokesman Tony Snow engaged in a long back-and-forth with reporters who were arguing that "strategic" might be more appropriate for the large-scale changes apparently being contemplated. "So what we're talking about they describe as strategy, I'll describe as tactics," Mr. Snow said resolutely. Some words no longer taboo are "milestones," "benchmarks," and "phased withdrawal." It would be hard to decree otherwise at a time when the administration is reportedly drafting a timetable for the Iraqi government to address sectarian strife and to assume a larger role in assuring security for the country. It appears that the Iraqi government will be asked to meet a schedule of specific timetables for disarming the sectarian militias. If these benchmarks are not met, then there may be a reassessment of - you guessed it - strategy. READ MORE

Colbert I. King: The Grand Ayatollah Behind the Curtain - The Washington Post

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This article isn't very deep and its analysis isn't very penetrating, but it does ask exactly the right question... What was the war really for? This is a question that will keep us busy for years and I don't think there is a simple answer. My hunch is there were/are several conspiracies running simultaneously and perhaps not even fully aware of each other's existence. That is the only explanation I can find for the moment for such a long running balls up. DS

The Grand Ayatollah Behind the Curtain - The Washington Post

By Colbert I. King
October 28, 2006

Abstract: The question directed this week to the National Security Council press office was straightforward: "Has the Grand Ayatollah Ali Sistani met with any American official, either military or civilian, since the U.S. invasion in 2003?" The answer reveals the extent to which the Bush administration is now, and always has been, out of its depth in Iraq.(...) Frederick Jones, the NSC's communications director, said yesterday that no American official has ever met Sistani. But how, you might ask, can that be? After all, since Hussein's statue was pulled down in 2003, Iraq has been visited twice by President Bush. Vice President Cheney has been there, too. Two different secretaries of state -- Colin Powell and Condoleezza Rice -- have dropped in. So have Defense Secretary Donald Rumsfeld, countless high-ranking Pentagon brass and enough U.S. senators and members of the House of Representatives to warrant a congressional annex in the Green Zone. How is it possible that leaders of the world's most powerful nation -- a country that has generously sent 140,000 of its finest sons and daughters to fight, suffer and die to free Iraq from the Baathist grip -- have not met the Iraqi leader with the most to gain from Hussein's defeat? It's because the Grand Ayatollah Ali Sistani has designated himself off-limits to Americans. He will not let Bush, Cheney, Rice and company in to see him because they are non-Muslims and thus he considers them to be kafir, or infidels. Sistani regards himself as too good to meet with those who freed him.(...) Sistani's chief competition is not the United States but an anti-American Shiite cleric, Moqtada al-Sadr, and his Badr Organization, which has infiltrated Iraqi military and police units. The Iraqi parliament, truth be told, responds to the calls of the firebrand cleric. What have we come to? In addition to al-Sadr, today's Iraq is under the influence of a Muslim cleric, Sistani, who, according to Newsweek, forbids music for entertainment, dancing and playing chess, and forbids women from shaking the hands of any men other than their fathers, brothers or husbands. His whole purpose is to promote Shiite theology and keep Iraq as a democratic, but decidedly Islamic, state. Billions spent, thousands of Americans dead or maimed, U.S. armed forces exhausted, stretched thin and working around the clock -- for that? Is this what George W. Bush had in mind? READ MORE

Friday, October 27, 2006

A Bush too far

Blumenthal: Bush’s Policy Quagmire - Salon

David Seaton's News Links
Bush can get away with stealing elections and with committing war crimes, but I would be very surprised if he could get away with diddling James Baker. DS

Abstract: The post-midterm-elections politics over Iraq have already begun. Many serious factors weigh on President Bush’s mind as he speaks about his quagmire. Besides the state of the war and the stability of the Iraqi government, the one that he stresses repeatedly and spontaneously is the commission on Iraq policy chaired by former Democratic Rep. Lee Hamilton and, most important, James A. Baker III, the elder Bush’s close associate and his secretary of state, who is scheduled to report to Congress and the president after the elections, when, presumably, one or both houses of Congress will fall to the Democrats. A new Democratic House (and perhaps Senate) will be receptive to Baker’s proposals. But will Bush?(...) Bush is engaged in a shadow politics of fending off Baker that he can’t admit and that require new disingenuous explanations for rejection even before receiving Baker’s report. But will consummate political player Baker permit a dynamic in which he is humiliated and join the ranks of the dismissed and discarded, like “good soldier” Colin Powell? If Baker, taking his cue from Bush’s rebuke, simply closes ranks, what would have been his point, except to highlight his failure at an attempted rescue? By undermining Baker, especially beforehand, Bush sends a signal that he is determined to maintain his counterproductive strategies in Iraq and the Middle East. Yet his tightening coil will trigger further attempts among U.S. allies and Arab governments to disentangle themselves.(...) When Bush was asked if he supported Baker’s suggestion of negotiations with Iran, he knocked it down, putting the onus entirely on the Iranians and making any negotiations dependent on their acceptance of U.S.-European demands not to develop nuclear weapons. Baker’s idea is not tied to those conditions. On Syria, Bush reiterated his old position and said, “They know our position, as well.” Since they already know it, there is no need for the diplomatic initiative Baker proposes.(...) Now it’s Baker’s move. Read More

Steve Bell in the Guardian

Paul Krugman: The Arithmetic of Failure

David Seaton's News Links
"It’s hard to believe that the world’s only superpower is on the verge of losing not just one but two wars." That phrase could sum up the entire feeling that the world is entering a period of enormous change. DS

Abstract: Iraq is a lost cause. It’s just a matter of arithmetic: given the violence of the environment, with ethnic groups and rival militias at each other’s throats, American forces there are large enough to suffer terrible losses, but far too small to stabilize the country. ... Afghanistan, on the other hand, is a war we haven’t yet lost, and it’s just possible that a new commitment of forces there might turn things around.(...) The classic analysis of the arithmetic of insurgencies is a 1995 article by James T. Quinlivan, an analyst at the Rand Corporation. “Force Requirements in Stability Operations” ... looked at the number of troops that peacekeeping forces have historically needed to maintain order and cope with insurgencies. Mr. Quinlivan’s comparisons suggested that ... in some cases it was possible to stabilize countries with between 4 and 10 troops per 1,000 inhabitants. But examples like the British campaign against communist guerrillas in Malaya and the fight against the Irish Republican Army in Northern Ireland indicated that ... a difficult environment could require about 20 troops per 1,000 inhabitants. The implication was clear: “Many countries are simply too big to be plausible candidates for stabilization by external forces,” Mr. Quinlivan wrote. ... Iraq is a cauldron of violence, far worse than Malaya or Ulster ever was. And that means that stabilizing Iraq would require a force of at least 20 troops per 1,000 Iraqis — that is, 500,000 soldiers and marines. We don’t have that kind of force.(...) If we stopped trying to do the impossible in Iraq, ... we and the British ... might still do some good. But we have to do something soon: the commander of NATO forces in Afghanistan says that most of the population will switch its allegiance to a resurgent Taliban unless things get better by this time next year. It’s hard to believe that the world’s only superpower is on the verge of losing not just one but two wars. But the arithmetic of stability operations suggests that unless we give up our futile efforts in Iraq, we’re on track to do just that. Read More

Thursday, October 26, 2006

Wolfowitz slams China banks on Africa lending - Financial Times

David Seaton's News Links
Once, upon a time little grasshopper , the United States, like the British Empire before it, was the "lender of last resort" for the world. The IMF and the World Bank were designed to give a more impersonal form to American hegemony. Now the Chinese, using the US dollars they earn by replacing the American manufacturing sector subvert US influence. Thus the opponent's strength and greed is turned against him and his own power weakens and defeats his very strategy, while making the wise warrior's power greater and at the same time enriching him. DS

Abstract: Paul Wolfowitz, president of the World Bank, has sharply criticised China and its banks for ignoring human rights and environmental standards when lending to developing countries in Africa.(...) Mr Wolfowitz said the World Bank had held "very direct" talks with the Chinese about problems that it had identified, but implied there had been no meeting of minds. "I hope in time our viewpoints will converge," he said. China's activities in Africa have begun to concern many officials from development agencies and campaigning organisations, who say Chinese companies are bypassing painstakingly constructed safeguards and guidelines designed to improve corporate governance. State-owned Chinese companies run oil operations in Sudan, for example, where US or Europe-based oil companies would find it impossible to adhere to standards of transparency and accountability that are demanded by western campaigners.(...) Commission officials highlight the agreement at a recent EU-China summit to hold regular expert-level meetings on Africa and development. But many EU diplomats complain that China is not observing the same rules as the rest of the world on development and will simply step in when other countries withhold their aid to African states.(...) The Commision notes that the EU's exports to China more than doubled in the five years to 2005, much faster than the rise in the bloc's exports to the rest of the world. The Commission also calls for the EU to "resolve" the stalled attempt to lift its arms embargo on China. Read More

Olmert's dangerous choice - Leader - Guardian

David Seaton's News Links
With the collapse of US positions in the Middle East on the horizon, Israel itself appears to be melting down. Ariel Sharon's coma seems
the situation's magic metaphor. DS

Avigdor Lieberman is a bad advertisement for Israel. The latest member of Ehud Olmert's coalition is a rightwinger who advocates a hard line against the Palestinians - and in a way that borders on the racist.(...) In policy terms, that means the annexation of the large Jewish settlements in the West Bank in a proposed "swap" that puts Arab areas in pre-1967 Israel under the jurisdiction of a future Palestinian state - formalised ethnic cleansing. Polls say he could win many more votes in future.(...) The background to this cynical move is the deep disarray in Israel since the month-long summer war in Lebanon. The army failed to defeat Hizbullah guerrillas and Mr Olmert, trying to look tough, appeared to make up policy on the hoof, killing 1,200 Lebanese and finally ordering an offensive in which scores of Israeli soldiers died in vain and thousands of cluster bombs rained down on Lebanese villages. To the dismay of doves, especially in the Labour party, Mr Lieberman is to be put in charge of "strategic threats", which will give him a say in defence policy, including towards Iran's nuclear ambitions. Thus his appointment is itself a "strategic threat," one liberal newspaper warned. With Hamas calling the shots on the Palestinian side and a known extremist wielding real power in Israel, the situation looks as bleak as it has for a long time. Read More

America and the Dollar Illusion - Der Spiegel

Don't read this before going to bed, you may not sleep. DS

America and the Dollar Illusion - Der Spiegel

By Gabor Steingart

Abstract: Does no one see that the tension between the dream and the reality is increasing and that this tension will snap, leading to suffering for millions? Of course they see it! Investors can see what is happening. They wonder about it and shake their heads. It even scares them a little, sending chills down their spine. But they keep buying dollars as though possessed. The greater their doubts, the more greedily they order dollars. Indeed, that's exactly what is so crazy about these investors and their behavior: The client isn't just a client. He creates the security he's purchasing by the very act of purchasing it. If he were to stop buying dollars tomorrow, suspicion about the currency would spread and insecurity would grow. Then the dream would end. The dollar would start to falter and all the wealth held in dollars would lose its value. Of course, that's not something investors want to see happen. The only way to fight a weak dollar is to strengthen it. Many people no longer care whether the US currency still justifies the faith people seem to have in it. The new game, which amounts to playing with fire, works exactly the other way around: The dollar deserves the faith it gets because otherwise it loses that faith. Dollars are bought so they don't have to be sold. The dollar is strong because that's the only thing that can prevent it from growing weak. Reality is ignored because only by ignoring it can the dream come true. Or, to put it still more clearly: Behaving irrationally has become rational behavior.(...) For capital market investors, reality isn't reality until the majority of investors are convinced it is reality and have begun reacting accordingly. Right now, everyone is watching everyone else closely. Everyone knows the dream of the stable economic superpower has ended, but everyone is keeping his eyes shut just a little longer. Government bonds and shares don't have any objective value -- nothing you can see, weigh, taste or even eat. Their value is measured by investors' faith that the purchasing power of $1 million will still be $1 million 10 years from now, rather than having been reduced by half. This faith is measured on the markets almost every second -- and the measure used is nothing but the faith of other investors. As long as the faithful outnumber the skeptics, everything works out fine for the dollar (and the world economy). The trouble starts the day the scale begins to tip.(...) The extent of this self-delusion can be read in the balance sheets of the banks: Almost no one is saving money in the United States today. The US foreign debt grows by about $1.5 billion every weekday and has now reached about $3 trillion. Private household debt, both at home and abroad, has reached $9 trillion -- and 40 percent of these debts has been incurred since 2001. The Americans are enjoying the present at the cost of selling off ever larger chunks of their future. Arguably, the imminent economic crisis is the most thoroughly predicted one in recent history. Rather than refuting the crisis, the current US economic boom merely heralds it. Biologists have observed similar phenomena in plants contaminated by toxins. Before they wither, they produce one last batch of healthy shoots -- to the point that they can hardly be distinguished from healthy plants. Some speak of a panic bloom. So who will be the first to destroy the dollar illusion? Aren't all investors bound together by an invisible link, since every attack on the key currency would lead to a loss of value for them, perhaps even destroying a large part of their financial assets? Why should the central banks of Japan or Beijing throw their dollars onto the market? What could make US pension funds willfully destroy their wealth, held in dollars? What sense would it make to send the United States into a deep crisis when that crisis could drag all the other states along? The underlying motive is the same as the one that once prompted investors to buy dollars -- fear. This time it is fear that someone else may be faster, fear that the dollar's strength won't last, fear that every day spent waiting may be one day too long. It's fear that the herd instinct of global financial markets will set in and overtake those who can't keep up.