Obama Plans Cosmetic Surveillance Changes After All, Will Set Up Pretend Fight Over NSLs
By Mike Masnick | Techdirt | January 6, 2014
Leaks coming out of the Obama administration suggest that the President is preparing mostly cosmetic changes to the intelligence community, following the recommendations from the intelligence task force — which were much stronger than many expected. The reports suggest things like putting a public advocate to represent the public’s views in certain cases before the FISC. This has been talked about for a while, and was the main concession plenty of people had been expecting anyway. That’s hardly anything big.
The article talks about two other potential reforms. The first is shifting the holding of phone call metadata from the NSA to the phone companies, allowing the NSA to still search through it after getting a court order. While this may be a marginal improvement, it still has tremendous problems. It will almost certainly come with some sort of data retention law — something that the feds have wanted for ages, and which civil liberties activists have been fighting against for years. Companies shouldn’t be required to hang on to data they don’t need, especially if getting rid of it can better protect their users’ privacy. Furthermore, while not letting the NSA hang onto the data is a good thing, there is a reasonable concern that if the telcos are hanging onto the data themselves, that they, too, might do bad things with it, with little to no oversight.
However, most of the article from the LA Times focuses on National Security Letter (NSL) reform. We’ve written about those for years. NSLs are the way that the FBI can demand information from companies without any judicial review at all and, even more insane, with a complete gag order that prevents the recipient from telling anyone (including, at times, your lawyer). The FBI has an incredibly long history of “serious misuse” of NSLs, and has shown little to no interest in fixing the process. Nearly a year ago, a court actually ruled them unconstitutional, but there’s an ongoing appeals process that will take quite a bit of time.
However, as the article notes, the DOJ/FBI and other surveillance maximalists are all horrified by the idea that Obama might actually require judicial approval of NSLs, for all but “emergency” situations. What this sounds like is that the President may suggest something along those lines, there will be a well coordinated press attack from surveillance hawks freaking out about the danger this puts us all in… and then he’ll back down on that one point. And we’ll be left with… basically nothing, but the President will go around insisting that he reformed the intelligence community, while everything more or less stays the same.
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Palestinians schools must adopt Israeli narrative of the conflict
MEMO | January 7, 2014
Israel is to tell the Palestinian Authority to change the history syllabus used in its schools as a condition ahead of negotiating final status issues. According to a specialist in Israeli studies, Saleh Al-Na’ami, Israel’s defence minister has said that Palestinian schools must teach the Israeli narrative of events before and since 1948, when what Palestinians call the Nakba (Catastrophe) of the creation of the state of Israel took place.
“They [the PA] need to cancel the Palestinian narrative of the history of the Palestinian-Israeli conflict,” Moshe Ya’alon is alleged to have said.
Haaretz reported that the weekly ministerial meeting on Sunday included a discussion about such a change in the Palestinian school syllabus. Ya’alon is also reported to be insisting on an end to Palestinians using speeches in mosques to “incite” the population against the Israeli occupation.
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Court Decision Exempts Secret Memo From FOIA, Sets Stage For Future Secret Laws To Go Unchallenged
By Tim Cushing | Techdirt | January 6, 2014
The “most transparent administration” received another win for continued secrecy, thanks to an appeals court decision that allowed it to continue to withhold a DOJ memo that created an exploitable loophole in consumer data privacy protections.
The document at issue is a classified memo issued by the Office of Legal Counsel on Jan. 8, 2010. A report later that year by the Justice Department’s inspector general at the time, Glenn A. Fine, disclosed the memo’s existence and its broad conclusion that telephone companies may voluntarily provide records to the government “without legal process or a qualifying emergency,” notwithstanding the Electronic Communications Privacy Act.
The EFF has been engaged with the government over the release of this document since 2011, when a district court judge ruled the document was exempt from FOIA requests because it was part of executive branch “internal deliberations.” In other words, despite the fact that the OLC memos can be considered legally binding (and exempt those following the memos’ advice or instructions from legal repercussions), the memo is not considered “working law.” The EFF has argued that these memos are not “deliberative,” but are rather secret laws deployed in such a fashion as to avoid being exposed by FOIA requests.
The presiding judge explained his decision with this reasoning.
“Even if the O.L.C. opinion describes the legal parameters of what the F.B.I. is permitted to do, it does not state or determine the F.B.I.’s policy,” Judge Harry T. Edwards wrote in the decision on Friday. “The F.B.I. was free to decline to adopt the investigative tactics deemed legally permissible in the O.L.C. opinion.”
According to the FBI, it did decline to follow the memo’s parameters.
The bureau, which has abandoned exigent letters, said that it did not employ the legal theory outlined in the memo when using the letters, and that it had no plans to use it in the future.
But the DOJ’s arguments for keeping the memo secret calls the FBI’s assertion into question.
During the litigation, the Justice Department also told the court that parts of the memo contained classified information, “highly specific in nature and known to very few individuals,” about a secret intelligence-gathering technique that the F.B.I. is using against “hostile entities.”
Either the FBI is utilizing the memo’s legal theories or the memo covers so much ground that the FBI is using something entirely unrelated, making the first statement truthful as far as it extends to exigent letters only.
Judge Edwards’ rationale gives the government every reason to utilize the Office of Legal Counsel to provide it with the legal justification it needs to deploy questionable tactics and programs. (Previous OLC memos were used to justify warrantless wiretaps and “brutal questioning of detainees.”) The ruling makes it easier for any OLC memo to be exempted from FOIA requests, providing for even more government secrecy.
David Sobel, a lawyer for the EFF, called the ruling “troubling,” describing the office’s memos as a body of “secret law” that the public has a right to know about. He said he hoped the ruling would reinvigorate efforts among some lawmakers to enact a law opening such memos to greater scrutiny outside the executive branch.
“It’s kind of hard to imagine how a different case in the D.C. Circuit is likely to have a different outcome in light of this opinion,” he said.
Because the document remains a secret, its true significance remains a source of speculation. The New York Times says the memo is most likely the legal basis for the CIA’s voluntary agreement with AT&T, which allows the agency to search its massive database of international calls (and tip local numbers to the FBI for further investigation). And it’s not as if this secret memo is the only tool the government has for demanding data. The FBI may have abandoned “exigent letters” but it’s still using National Security Letters to obtain data without a court order. (No mention is made of the FBI’s exigent Post-It notes or over-the-shoulder database searches.)
The DOJ is understandably pleased with this decision as it plays to its obfuscatory tendencies. This is also a dubious win for this administration — and those that follow. Having an in-house agency on tap that can create new laws and interpretations of existing statutes without having to risk having its legally-binding memos scrutinized by the public will be a tool too powerful for many to ignore.
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FBI Admits It’s Not Really About Law Enforcement Any More; Ignores Lots Of Crimes To Focus On Creating Fake Terror Plots
By Mike Masnick | Techdirt | January 6, 2014
A couple years ago, it was revealed that the FBI noted in one of its “counterterrorism training manuals” that FBI agents could “bend or suspend the law and impinge upon the freedoms of others,” which seemed kind of odd for a government agency who claimed its “primary function” was “law enforcement.” You’d think that playing by the rules would be kind of important. However, as John Hudson at Foreign Policy has noted, at some point last summer, the FBI quietly changed its fact sheet, so that it no longer says that “law enforcement” is its primary function, replacing it with “national security.”
Of course, I thought we already had a “national security” agency — known as the “National Security Agency.” Of course, while this may seem like a minor change, as the article notes, it is the reality behind the scenes. The FBI massively beefed up resources focused on “counterterrorism” and… then let all sorts of other crimes slide. Including crimes much more likely to impact Americans, like financial/white collar fraud.
Between 2001 and 2009, the FBI doubled the amount of agents dedicated to counterterrorism, according to a 2010 Inspector’s General report. That period coincided with a steady decline in the overall number of criminal cases investigated nationally and a steep decline in the number of white-collar crime investigations.
“Violent crime, property crime and white-collar crime: All those things had reductions in the number of people available to investigate them,” former FBI agent Brad Garrett told Foreign Policy. “Are there cases they missed? Probably.”
The article correctly notes that this has had a big impact:
The reductions in white-collar crime investigations became obvious. Back in 2000, the FBI sent prosecutors 10,000 cases. That fell to a paltry 3,500 cases by 2005. “Had the FBI continued investigating financial crimes at the same rate as it had before the terror attacks, about 2,000 more white-collar criminals would be behind bars,” the report concluded. As a result, the agency fielded criticism for failing to crack down on financial crimes ahead of the Great Recession and losing sight of real-estate fraud ahead of the 2008 subprime mortgage crisis.
… So… what has the FBI been doing? Well, every time we hear anything about the FBI and counterterrorism, it seems to be a case where the FBI has been spending a ton of resources to concoct completely made up terrorism plots, duping some hapless, totally unconnected person into taking part in this “plot” then arresting him with big bogus headlines about how they “stopped” a terrorist plot that wouldn’t have even existed if the FBI hadn’t set it up in the first place. And this is not something that the FBI has just done a couple times. It’s happened over and over and over and over and over and over and over and over and over and over and over and over again. And those are just the stories that we wrote about that I can find in a quick search. I’m pretty sure there are a bunch more stories that we wrote about, let alone that have happened.
All of these efforts to stop their own damn “plots” screams of an agency that feels it needs to “do something” when there’s really nothing to be done. Thousands of agents were reassigned from stopping real criminals to “counterterrorism” and when they found there were basically no terrorists around, they just started making their own in order to feel like they were doing something… and to have headlines to appease people upstairs. The government seems to have gone collectively insane when it comes to anything related to “terrorism.

The Left after the Failure of Obamacare
By Shamus Cooke | Worker’s Compass | January 4, 2014
It’s satisfying to watch rats flee a sinking ship. This is because onlookers knew the ship was doomed long ago, and swimming rats signify that the drawn-out tragedy is nearing an end. A collective sense of relief is a natural response.
The rats who propped up the broken boat of Obamacare are a collection of liberal and labor groups who frittered away their group’s resources—and integrity— to sell a crappy product to the American people.
Those in the deepest denial went “all in” for Obamacare— such as some unions and groups like Moveon.org— while the more conniving groups and individuals—like Michael Moore— playacted “critical” of Obamacare, while nevertheless declaring it “progressive”, in effect adding crucial political support to a project that deserved none.
But of course Obamacare was always more barrier than progress: we’ve wasted the last several years planning, debating, and reconstructing the national health care system, all the while going in the wrong direction— into the pockets of the insurance mega corporations. A couple progressive patches on the sails won’t keep her afloat. It’s shipbuilding time.
It was painful to watch otherwise intelligent people lend support to something that’s such an obviously bad idea. So it’s with immense relief that liberals like Michael Moore, labor groups, and others are finally distancing themselves from Obamacare’s Titanic failure. Now these individuals and groups can stop living in denial and the rest of us can proceed towards a rational discussion about a real health care solution.
The inevitable failure of Obamacare is not due to a bad website, but deeper issues. The hammering of the nails in the coffin has begun: millions of young people are suddenly realizing that Obamacare does not offer affordable health care. It’s a lie, and they aren’t buying it, literally.
The system depends on sufficient young people to opt in and purchase plans, in order to offset the costs of the older, higher-needs population. Poor young people with zero disposable income are being asked to pay monthly premiums of $150 and more, and they’re opting out, inevitably sinking Obamacare in the process.
Those young people who actually do buy Obamacare plans—to avoid the “mandate” fine— will be further enraged when they attempt to actually use their “insurance”. Many of the cheapest plans—the obvious choice for most young people— have $5,000 deductibles before the insurance will pay for anything. For poor young people this is no insurance at all, but a form of extortion.
At the same time millions of union members are being punished under Obamacare: those with decent insurance plans will suffer the “Cadillac” tax, which will push up the cost of their healthcare plans, and employers are already demanding concessions from union members in the form of higher health care premiums, co-pays, deductibles, etc.
Lower paid union workers will suffer as well. Those who are part of the Taft Hartley insurance plans will be pressured to leave the plans and buy their own insurance, since they cannot keep their plans and get the subsidy that the lowest income workers get. This has the potential to bust the whole Taft Hartley health care system that millions of union members benefit from, which is one of the reasons that labor leaders suddenly became outraged at Obamacare, after having wasted millions of union member’s dollars propping it up.
Ultimately, the American working class will collectively cheer Obamacare’s demise. They just need labor and other lefties to cheer lead its destruction a little more fiercely.
Surprisingly, most of the rats are still clinging to Obama’s hopeless vessel, frantically bailing water. Sure they’ve put on their life preservers and are anxiously eyeing the lifeboats, but they’re also preaching about how to re-align the deckchairs.
For example, in his “critical” New York Times op-ed piece, Michael Moore called Obamacare “awful”, but also called it a “godsend”, singing his same tired tune. Part of Moore’s solution for Obamacare—which was cheered on in the Daily Kos— is equally ludicrous, and follows his consistently flawed logic that Obamacare is worth saving, since its “progress” that we can build on. Moore writes:
“Those who live in red [Republican dominated] states need the benefit of Medicaid expansion [a provision of Obamacare]…. In blue [Democrat dominated] states, let’s lobby for a public option on the insurance exchange — a health plan run by the state government, rather than a private insurer.”
This is Moore at his absolute worst. He’s neck deep in the flooded hull of the U.S.S Obamacare and giving us advice on how to tread water.
Of course Moore doesn’t criticize the heart of Obamacare, the individual mandate, the most hated component.
Moore also relies on the trump card argument of the pro-Obamacare liberals: there are progressive aspects to the scheme—such as the expansion of Medicaid— and therefore the whole system is worth saving.
Of course it’s untrue that we need Obamacare to expand Medicaid. In fact, the expansion of Medicaid acted more as a Trojan horse to introduce the pro-corporate heart of the system; a horse that Moore and other liberals nauseatingly continue to ride on.
But Moore’s sneakiest argument is his advice to blue states to “…lobby for a public option on the insurance exchange…”
Again, Moore implies that it’s ok if we are “mandated” to buy health insurance, so long is there is a public option. But that aside, the deeper scheme here is that Moore wants us to further waste our energy “reforming” Obamacare, rather than driving it to the bottom of the sea.
Moore surely knows that very few people are going to march in the streets demanding a public option at this point; he therefore knows that even this tiny reform of the system is unachievable. He’s wasting our time. Real change only happens in politics when there is a surge of energy among large sections of the population, and it’s extremely unlikely that more than a handful of people are going to be active towards “fixing” Obamacare— they want to drown it.
Moore’s attempt to funnel people’s outrage at Obamacare towards a “public option” falls laughably short, and this is likely his intention, since his ongoing piecemeal “criticisms” of the system have only served to salvage a sunken ship.
Instead of wasting energy trying to pry Obamacare out of the grip of the corporations, Moore would be better served to focus exclusive energy towards expanding the movement for Medicare For All, which he claims that he also supports, while maintaining that somehow Obamacare will evolve into Single Payer system.
Most developed nations have achieved universal health care through a single payer system, which in the United States can be easily achieved by expanding Medicare to everybody. Once the realities of Obamacare directly affect the majority of the population and exacerbates the crisis of U.S. healthcare, people will inevitably choose to support the movement of Medicare for All, the only real option for a sane health care system.
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France-UAE satellite deal shaky after US spy tech discovered onboard – report
RT | January 6, 2014
The sale of two intelligence satellites to the UAE by France for nearly a billion dollars could go south after they were found to contain American technology designed to intercept data transmitted to the ground station.
The equipment, costing 3.4 billion dirhams ($930 million), constitutes two high-resolution Pleiades-type Falcon Eye military intelligence satellites, which a top UAE defense source has said contain specific US-made components designed to intercept the satellites’ communications with their accompanying ground station, Defensenews.com said in a report.
“The discovery [of the US-made components] was reported to the deputy supreme commander [Sheikh Mohamm ed Bin Zayed] in September,” an unnamed defense source said. “We have requested the French to change these components and also consulted with the Russian and Chinese firms.”
“If this issue is not resolved, the UAE is willing to scrap the whole deal,” said the source, adding that the incident has seen an increase in talks with Moscow, which – along with Beijing – has also been a frequent defense tech supplier to the Gulf state.
However, it is not clear whether the US equipment can be taken off of the French satellites.
The satellites come courtesy of prime contractor Airbus Defence and Space and payload manufacturer Thales Alenia, neither of whom could be reached for comment.
The system, comprised of satellites and a ground station, will require 20 trained engineers to operate. Under the July 22 deal, signed by Sheikh Mohammed, Crown Prince of Dubai and deputy supreme commander of the armed forces, and French Defense Minister Jean-Yves Le Drian, delivery of the satellites and the ground station was to be made sometime in 2018.
A total of 11 international bidders were competing in the Flacon Eye race for more than a decade to ship their technologies to the UAE, which in late 2012 announced that they had chosen to go with the French and the Americans.
According to the source, the French won because of the filters which their rival Americans imposed on the use of the equipment – a policy dubbed “shutter control.” The US government restricts sale of commercial high resolution satellite images from spacecraft it licenses, if they are deemed a threat to its national security.
One French defense specialist found it surprising that France had had US spy technology on board its equipment, especially when France’s use of the Pleiades surveillance system is considered to be of critical importance to its national security.
According to Defensenews, UAE threats to call off the deal are seen by some commentators as a way to secure a better bargain from the French, because “the satellites would be part of a big package deal… it’s not surprising the UAE drives a hard bargain. They’re using it as a layer of power.”
The unnamed defense specialist referred to the possibility that the Emirates may wish to drive the price down for other equipment, such as the Dessault Aviation Rafale fighter jet.

Who Benefits from the Shatah Assassination?
By RANNIE AMIRI | CounterPunch | January 3, 2014
The burial of former Lebanese Finance Minister Mohammed Shatah next to assassinated ex-premier Rafic al-Hariri in Beirut’s Muhammad al-Amin mosque was as striking and deliberate in symbolism as the towering structure itself.
Last Friday’s assassination of the Hariri family’s senior advisor and one-time U.S. ambassador was by similar method: a massive car bomb detonated under his convoy as it drove through the heart of Beirut’s upscale downtown district. As if to purposefully underscore the parallels and frame the post-assassination narrative, it also occurred just a few hundred yards from the site where the billionaire Hariri was murdered in February 2005.
Just as after Hariri’s killing, the calculated recriminations of the March 14 coalition, led by the Future Movement, came fast and furious. Blame was laid squarely at the feet of Hezbollah. March 14 supporters were quick to point out that the crime took place less than three weeks before the Special Tribunal for Lebanon (STL; the U.N.-established court tasked with investigating the Hariri assassination) was set to open proceedings against four accused Hezbollah members.
The shoddy STL investigation, relying heavily on telecommunications data wholly compromised by Israeli intelligence and their captured agents, has been previously discussed.
Did the masterminds of the Shatah assassination hope the Lebanese population would turn against Hezbollah, already facing strong rebuke for its intervention in Syria by March 14 politicians (despite that the latter have implicitly lent support to radical takfiri elements involved in the Syrian conflict since its earliest days)?
As with all political upheavals in Lebanon, the question that must be asked is, “who benefits?” Does Hezbollah? Although Shatah was a stalwart March 14 operative who decried Hezbollah’s role in Syria, he was nevertheless regarded as a relative moderate. But the increasingly virulent sectarian discourse of those on the fringes of this political alliance (and many at its center) and the cover they have extended to extremists like fugitive Sheikh Ahmad al-Assir, cannot be ignored. Beirut after all, is still reeling from recent twin suicide car bombings at the Iranian embassy followed shortly thereafter by the assassination of Hezbollah senior commander Hassan al-Lakkis. On Thursday, innocent Lebanese civilians were again victims of a car bomb detonated in the Haret Hreik neighborhood of Beirut’s Shia-majority southern suburbs, known as the dahiyeh.
“Moderate” Sunni politicians like Shatah are viewed as expendable, for their killing only serves to polarize the wider Sunni community by inciting sectarian hatred and thereby marginalize more reasoned voices. Even Lebanon’s Grand Mufti was not spared as he was accosted after mourners’ passions were stoked by Sheikh Ahmad al-Omari, the cleric who delivered the sermon at the funeral of a young man also killed in the assassination. As Al-Akhbar reports, “Omari attacked Hezbollah, describing it as the ‘party of the devil.’ He called on the Shia to ‘disown’ Hezbollah ‘if they are true believers,’ and stressed the ‘patience of the persecuted Sunni sect is running out.’”
Again, does Hezbollah achieve any gain, political or otherwise, with Shatah’s demise?
The irony is that the inflammatory rhetoric and policies of March 14 parliamentary bloc members have led to the exponential growth of radical forces in the country. One only has to recall how former Prime Minister Fouad Siniora, Bahia Hariri and others insinuated the Lebanese Army was responsible for provoking Salafist cleric al-Assir’s armed forces to launch an attack against them this past summer in Sidon, killing 18.
Son of the late prime minister and Future Movement head Saad Hariri also did not waste any time in essentially blaming the victims themselves for Thursday’s attack: “They are at the same time victims of [Hezbollah’s] involvement in foreign wars, particularly in the Syrian war.”
The northern city of Tripoli and the Ain al-Hilwah Palestinian refugee camp near Sidon have provided extremist groups with safe refuge. Details have now emerged pointing to a possible link between those in the camp and recent events.
Just as in Iraq, moderate Sunni politicians have been singled out for assassination by takfiris who seek to exploit their spilled blood, provoke co-religionists into committing crimes against civilians and stir a simmering sectarian pot.
Who are the likely perpetrators behind Mohammed Shatah’s assassination and the dahiyeh bombing?
The very same ones the U.S. and Saudi-backed March 14 coalition have emboldened.
Rannie Amiri is an independent commentator on Middle East affairs.
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British MPs raise alarm over drug trials, say only half data published
RT | January 5, 2014
British MPs have voiced concern that doctors and researchers are being denied access to around half the results from all clinical trials. An influential parliamentary committee has condemned the selectiveness as damaging medicine as a whole.
This apparently standard practice of withholding critical medical test information impairs decision-making by professionals, worsens patients’ treatment and prevents independent assessment of medicines, the MPs wrote. And the practice, they say, dates back all the way to the 1980s.
In the report, the MPs write that they are “surprised and concerned to discover that information is routinely withheld from doctors and researchers about the methods and results of clinical trials on treatments currently prescribed in the United Kingdom. This problem has been noted for many years in the professional academic literature, with many promises given, but without adequate action being taken by government, industry or professional bodies.”
“This has ramifications for the whole of medicine. The ability of doctors, researchers and patients to make informed decisions about treatments is being undermined,” said Richard Bacon, a senior member on the committee that published the report.
The MPs argue that this is a great problem also because the issue of access to clinical trials from previous years is absent from all new proposals. And test results on humans provide researchers with key evidence to support or oppose the use of a given medicine. There are unprecedented dangers when this framework is not operating as intended, they said.
Compounding the problem further, MPs say, is that aside from the non-publication of all clinical trial tests, for some reason positive results started popping up twice as much as negative ones. This is bad when all trial results on all uses of all chemicals should be provided, the report argues.
As a result, the committee’s MPs have given strong recommendations to the government and the country’s health bodies – among them, firstly, that the full results of clinical trials from now on be disseminated to all doctors and researchers in the UK, with full audits carried out regularly to check for transgressions; and secondly, that the Department of Health and the Medicines and Healthcare products Regulatory Agency (MHRA) ensure that all past and future trial results and the methods used to achieve them be published in a unified register for further use.
Bacon expressed alarm that the absence of past results invariably impact doctors’ decisions on treatment. “Regulators and the industry have made proposals to open up access, but these do not cover the issue of access to the results of trials in the past which bear on the efficacy and safety of medicines in use today,” he said.
The worrying implication here is that so much medicine has been tested and approved over the past few decades, but only half of it we know the full truth about, it turns out.
One particular medicine that became a focus for alarm was Tamiflu – the popular flu medicine that gained popularity in 2009-10 during the great flu pandemic. Apparently, the UK Department of Health, without having access to exhaustive information on the medicine, had made a 424-million-pound decision to stockpile it between the years 2006-7 and 2012-13.
That kind of attitude, the MPs argue, is predicated on judgment, rather than real science. There is still no agreement on how the popular medicine works and disagreement on whether full information was provided to regulators by the MHRA during the licensing process. As it turns out from studies conducted by the non-profit NGO, Cochrane Collaboration, Tamiflu “did not reduce influenza-related lower respiratory tract complications.”
The organization is now in talks with Roche to receive the full details of Tamiflu’s testing, which will be included in a thorough upcoming review on its effectiveness. Both the government and the medical bodies will take part, as MPs share the think tank’s concern when it wrote that “we find it perplexing that the regulators continue to state that they had all the available evidence.”
Regarding Tamiflu and the wider practice as a whole, Bacon recommended that “before spending money in future to maintain the stockpile, the department needs to review what level of coverage is appropriate. It should look at the level of stockpiling in other countries, bearing in mind that the patent for the medicine runs out in 2016.”

The Case of the Missing Recovery
By Paul Craig Roberts | Dissident Voice | January 4, 2014
Have you seen the economic recovery? I haven’t either. But it is bound to be around here somewhere, because the National Bureau of Economic Research spotted it in June 2009, four and one-half years ago.
It is a shy and reclusive recovery, like the “New Economy” and all those promised new economy jobs. I haven’t seen them either, but we know they are here, somewhere, because the economists said so.
Congress must have seen all those jobs before they went home for Christmas, because our representatives let extended unemployment benefits expire for 1.3 million unemployed Americans, who have not yet met up with those new economy jobs, or even with an old economy job for that matter.
By letting extended unemployment benefits expire, Congress figures that they saved 1.3 million Americans from becoming lifelong bums of the nanny state and living off the public purse. After all, who do those unemployed Americans think they are? A bank too big to fail? The military-security complex? Israel?
What the unemployed need to do is to form a lobby organization and make campaign contributions.
Just as economists don’t recognize facts that are inconsistent with corporate grants, career ambitions, and being on the speaking circuit, our representatives don’t recognize facts inconsistent with campaign contributions.
For example, our representative in the White House tells us that ObamaCare is a worthy program even though those who are supposed to be helped by it aren’t because of large deductibles, copays, and Medicaid estate recovery. The cost of this non-help is a doubling of the policy premiums on those insured Americans who did not need ObamaCare and the reclassification by employers of workers’ jobs from full-time to part-time in order to avoid medical insurance costs. All it took was campaign contributions from the insurance industry to turn a policy that hurts most and helps none into a worthy program. Worthy, of course, for the insurance companies.
Keep in mind that it is the people who could not afford medical insurance who have to come up with their part of the premium or pay a penalty. How do people who have no discretionary income come up with what are to them large sums of money? Are they going to eat less, drive less, dress less? If so, what happens to people employed in those industries when demand falls? Apparently, this was too big a thought for the White House occupant, his economists, and our representatives in Congress.
According to the official wage statistics for 2012, forty percent of the US work force earned less than $20,000, fifty-three percent earned less than $30,000, and seventy-three percent earned less than $50,000. The median wage or salary was $27,519. The amounts are in current dollars and they are compensation amounts subject to state and federal income taxes and to Social Security and Medicare payroll taxes. In other words, the take home pay is less.
To put these incomes into some perspective, the poverty threshold for a family of four in 2013 was $23,550.
In recent years, the only incomes that have been growing in real terms are those few at the top of the income distribution. Those at the top have benefitted from “performance bonuses,” often acquired by laying off workers or by replacing US workers with cheaper foreign labor, and from the rise in stock and bond prices caused by the Federal Reserve’s policy of quantitative easing. Everyone else has experienced a decline in real income and wealth.
As only slightly more than one percent of Americans make more than $200,000 annually and less than four-tenths of one percent make $1,000,000 or more annually, there are not enough people with discretionary income to drive the economy with consumer spending. When real median family income and real per capita income ceased to grow and began falling, Federal Reserve chairman Alan Greenspan substituted a credit expansion to take the place of the missing growth in income. However, as consumers became loaded with debt, it was no longer possible to expand consumer spending with credit expansion.
World War II left the US economy the only undamaged industrial and manufacturing center. Prosperity ensued. But by the 1970s the Keynesian demand management economic policy had produced stagflation. Reagan’s supply-side policy was able to give the US economy another 20 years. But the collapse of the Soviet Union brought an era of jobs offshoring to large Asian economies that formerly were closed to Western capital. Once corporate executives realized that they could earn multi-million dollar performance bonuses by moving US jobs abroad and once they were threatened by Wall Street and shareholder advocates with takeovers if they did not, American capitalism began giving the US economy to other countries, mainly located in Asia. As high productivity manufacturing and professional service jobs (such as software engineering) moved offshore, US incomes stagnated and fell.
As real income growth stagnated, wives entered the work force to compensate. Children were educated by refinancing the home mortgage and using the equity in the family home or with student loans that they do not earn enough to repay. Since the December 2007 downturn, Americans have used up their coping mechanisms. Homes have been refinanced. IRAs raided. Savings drawn down. Grown children, now adults, are back home with parents. The falling labor force participation rate signals that the economy can no longer provide jobs for the workforce. In such a situation, economic recovery is impossible.
What the Treasury and Federal Reserve have done, with the complicity of the White House, Congress, economists, and the media, is to focus on rescuing a half dozen banks “too big to fail.” The consequence of focusing economic policy on saving the banks is rigged financial markets and massive stock and bond market bubbles. To protect the dollar’s exchange value from quantitative easing, the price of gold has been forced down in the paper futures market, with the consequence that physical gold is shipped to Asia where it is unavailable as a refuge for Americans faced with currency depreciation.
At a time when most Americans are running out of coping mechanisms, the US faces a possible financial collapse and a high rate of inflation from dollar depreciation as the Fed pours out newly created money in an effort to support the rigged financial markets.
It remains to be seen whether the chickens can be kept from coming home to roost for another year.
~
Paul Craig Roberts is an American economist, author, columnist, former Assistant Secretary of the Treasury, and former editor and columnist for corporate media publications. He is the author of The Failure of Laissez Faire Capitalism.
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The Guardian Laments Sharon
By Gilad Atzmon | January 4, 2014
In a uniquely dishonest piece, The Guardian’s Jonathan Freedland paid a tribute today to Israel’s veteran PM Ariel Sharon.
According to Freedland, Sharon, “as one of Israel’s founders… had the credibility to give up occupied territory – and even to face the demons of 1948”. Freedland speculates also that “Sharon’s final mission might well have been peace.” This is indeed a big statement, but how does Freedland support his creative historical account?
“Sharon’s final act” says Freedland, “was to dismantle some of the very settlements he had sponsored. In 2005 he ordered Israel’s disengagement from Gaza, seized in the 1967 war in which Sharon had been a crucial, if maverick, commander.”
Let alone the fact that Freedland comes short of reminding his readers about Sharon’s colossal war crimes, he actually completely distorts the political narrative that led Sharon to the 2005 unilateral disengagement.
Did Sharon have a plan to reconcile with the Palestinians and to address their plight or their right to return to their land? Not at all, we do not have any evidence of Sharon’s remorse. The logic behind Sharon’s disengagement is simple on the verge of banal. Sharon knew very well that if Israel insisted to maintain itself as the ‘Jewish State’, it would have to rid itself immediately of Arabs. Late Sharon was becoming aware of the possible implications of the ‘Palestinian demographic bomb’. The Palestinians were becoming a majority in areas controlled by Israel.
Ridding Israel of the highly populated Gaza strip was a perfect start. In a single political and territorial move, Sharon freed Israel of 1.5 million Palestinians and liberated Israel of growing complex security issues. Sharon was a pragmatist politician, he’s always been one and his disengagement wasn’t at all an attempt to “face the demons of 1948” as Freedland suggests: It was a Judeo-centric attempt to maintain the Jewishness of the Jewish State.
Freedland’s biased inclinations continue till the end of today’s piece: “an intriguing habit of Sharon’s was to refer to places in Israel by their original, Arabic names – thereby acknowledging the truth that usually lies buried beneath the soil.” Is this right? Did Sharon really pay tribute to the eradicated Palestinian civilisation by uttering some words in Arabic? Not at all: Sharon was born in the British Mandate of Palestine. He was raised in a country scattered with Palestinian villages and cities. Sharon and Israelis of his generation tended to pepper their Hebrew with a few Arabic words because such an act filled their existence with an authentic sense of belonging and a bond to an imaginary soil. I hope in that context, the laughable Freedland doesn’t also think when Israelis eat Falafel they try to express empathy towards 6 million Palestinian refugees: After all, Falafel also belongs to Palestine.
Freedland probably waited for Ariel Sharon to die in order to spread his laughable reading of history, just to make sure that the ‘immortal Sharon’ would not bounce back and dismiss this gross interpretation as complete nonsense.
The only question that is still left open is why The Guardian, once a respected paper, is publishing such low quality Hasbara drivel? Is it really The Guardian of the truth or has it become The Guardian of Zion?

When Your Phone Is Not Your Friend
By Peter Lee | China Matters | January 2, 2014
Gadzooks! They’ve cracked the iPhone!?
Newly leaked documents from the National Security Agency highlight Dropout Jeep, a piece of software that could target one of the country’s most popular devices — the iPhone.
According to documents published by the German news website Spiegel Online and dated Oct. 1, 2008, Dropout Jeep would give the NSA the ability to retrieve contact information, read through text messages, listen to voicemails and even turn on the iPhone camera and microphone.
The document goes on to say that while Drop Jeep was currently limited to installation through “close access methods,” the NSA would research ways to install the program remotely in future versions.
If you’re wondering how the NSA developed this fiendish capability, fingers are being pointed at Apple, but a trip through the Wayback machine suggests another possible culprit:
From a 2011 article by Mark Elgan at Computerworld:
Cellphone users say they want more privacy, and app makers are listening.
No, they’re not listening to user requests. They’re literally listening to the sounds in your office, kitchen, living room and bedroom.
A new class of smartphone app has emerged that uses the microphone built into your phone as a covert listening device — a “bug,” in common parlance.
…
The issue was brought to the world’s attention recently on a podcast called This Week in Tech. Host Leo Laporte and his panel shocked listeners by unmasking three popular apps that activate your phone’s microphone to collect sound patterns from inside your home, meeting, office or wherever you are.
…
The new apps are often sneakier about it [than older apps, which were activated by users in order to identify a song that was playing, etc.–CH]. The vast majority of people who use the Color app, for example, have no idea that their microphones are being activated to gather sounds.Welcome to the future.
…
[M]arketers love cellphones, which are viewed as universal sensors for conducting highly granular, real-time market research.Of course, lots of apps transmit all kinds of private data back to the app maker. Some send back each phone’s Unique Device Identification (UDI), the number assigned to each mobile phone, which can be used to positively identify it. Other apps tell the servers the phone’s location. Many apps actually snoop around on your phone, gathering up personal information, such as gender, age and ZIP code, and zapping it back to the company over your phone’s data connection.
Methinks it would behoove consumers wondering how the NSA might get into their iPhones to hie themselves to their local App Store.
A little further back in the Wayback machine brings us to the analog era, my favorite, when all that was needed to turn your home phone into a microphone was some fiddling at the telco switch. From Bloomberg in 1999:
It’s hardly a secret that phone taps are a favorite ploy of industrial spies as well as law-enforcement agencies. What isn’t well-known is that the phone doesn’t even have to be off the hook to be tapped. It’s possible to activate a hung-up phone remotely and use it to eavesdrop. This techno-trick recently came to light as a result of a drug dealer’s court case in the Netherlands–but it is said that the technique will work on virtually any phone anywhere.
I remember reading somewhere that this was a much-cherished technology for various British intelligence outfits working through British Telecom and its previous incarnation, Post Office Telecommunications.
And from Mark Bowden’s book on the US-assisted manhunt for Pablo Escobar in the early 1990s, Killing Pablo, here is a nugget from the analog cell phone era which, I expect, still applies today:
There was another nifty secret feature to Centra Spike’s capability [a US Army sigint outfit that, unlike the NSA, was tasked with providing tactical intelligence to special operations–CH]. So long as their target left the battery in his cell phone, Centra Spike could remotely turn it on whenever they wished. Without triggering the phone’s lights or beeper, the phone could be activated so that it emitted a low-intensity signal, enough for the unit to get a fix on its general location…
With this background, the extravagant cybercaution of Brookings China wonk Kenneth Lieberthal is understandable:
When Kenneth G. Lieberthal, a China expert at the Brookings Institution, travels to that country, he follows a routine that seems straight from a spy film.
He leaves his cellphone and laptop at home and instead brings “loaner” devices, which he erases before he leaves the United States and wipes clean the minute he returns. In China, he disables Bluetooth and Wi-Fi, never lets his phone out of his sight and, in meetings, not only turns off his phone but also removes the battery, for fear his microphone could be turned on remotely. He connects to the Internet only through an encrypted, password-protected channel, and copies and pastes his password from a USB thumb drive. He never types in a password directly, because, he said, “the Chinese are very good at installing key-logging software on your laptop.”
I have a feeling that Mr. Lieberthal’s countermeasures are informed both by awareness of PRC perfidy, and knowledge of the immense penetration and surveillance capabilities the industrial-security partnership has brought to the telecom and networking game around the world.
If you’re in China–or anywhere else–that phone in your pocket: it’s not your friend.






