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“West uses capital outflow as pressure tactics on BRICS”- Russia

The BRICS Post | May 26, 2015

Russian national security advisor Nikolai Patrushev has alleged that Western countries have used capital outflows from BRICS countries as a pressure tactic.

India and Brazil, among the BRICS countries, are most vulnerable to capital outflows as they rely heavily on external funding.

Western countries have pulled out more than $3.5 trillion over the last 10 years and $1.5 trillion from BRICS countries over the last three years as a mechanism to pressure the group, Russian Security Council Secretary Nikolai Patrushev said Tuesday.

“International financial institutions are being used by the West more and more often as an instrument of pressure. Over the last 10 years, the total capital outflow from the BRICS economies has reached $3.5 trillion, and more than half of that total left over the last three years,” Patrushev said during a BRICS security meeting in Moscow.

Patrushev added “the creation of BRICS development bank is an important step in ensuring economic security of the BRICS countries.”

India’s Central Bank Governor Raghuram Rajan, had also said earlier that India needs to build a “bullet-proof national balance sheet” to deal with the fallout on the economy from outflow of capital.

May 26, 2015 Posted by | Economics, Solidarity and Activism | , | Leave a comment

Under Shadow of Trade Deal, US Pesticide Lobby Pressured EU to Dump Toxic Pesticide Rules

By Deirdre Fulton | Common Dreams | May 22, 2015

Under pressure from the U.S. and agrochemical industry lobbyists and amid ongoing negotiations for a controversial trade deal, the European Union dropped planned rules that could have led to the banning of 31 pesticides containing hazardous chemicals, a new investigative report has revealed.

The probe, led by the Brussels-based research and watchdog group Corporate Europe Observatory (CEO) and French journalist Stephane Horel, exposes how corporate lobby groups like the American Chemistry Council, CropLife America, and the American Chambers of Commerce, mobilized to stop the EU from taking action on hormone (endocrine) disrupting chemicals (EDCs)—known to have significant health and environmental impacts.

“Hundreds of documents … show unambiguously how science is being manipulated to defend vested interests, manufacture doubt and delay a pioneering regulation.”
—Nina Holland, Corporate Europe Observatory

According to the report—titled A Toxic Affair: How the Chemical Lobby Blocked Action on Hormone Disrupting Chemicals (pdf)—the examination of evidence “sheds light on how corporations and their lobby groups have used numerous tactics from the corporate lobbying playbook: scaremongering, evidence-discrediting, and delaying tactics as well as the ongoing [TransAtlantic Trade and Investment Partnership, or TTIP] negotiations as a leverage.”

Specifically, the Guardian reports: “Draft EU criteria could have banned 31 pesticides containing endocrine disrupting chemicals (EDCs). But these were dumped amid fears of a trade backlash stoked by an aggressive US lobby push.”

The newspaper adds:

On the morning of 2 July 2013, a high-level delegation from the US Mission to Europe and the American Chambers of Commerce (AmCham) visited EU trade officials to insist that the bloc drop its planned criteria for identifying EDCs in favour of a new impact study. By the end of the day, the EU had done so.

The TTIP is a corporate-friendly trade deal, currently being negotiated between the U.S. and the European Union, that is already opposed by environmental, food safety, and labor groups for its lack of transparency, corporate concessions, and negative implications for people and the planet.

Common Dreams has previously reported on efforts by pesticide lobby groups to use ongoing trade negotiations to align regulatory standards by lowering them to U.S. levels rather than increasing them to the stronger safeguards in the E.U.

In a report (pdf) released earlier this year, the Center for International Environmental Law declared that “stronger, more progressive regulations for the protection of health and the environment are being targeted by industry for elimination under the Trans-Atlantic Trade and Investment Partnership (TTIP).”

The new revelations only add fuel to the fire.

“This is yet further evidence that the European Commission is more than willing to trade off, weaken, or delay much needed regulation and protections for the sake of completing this TTIP trade deal,” Samuel Lowe, of Friends of the Earth, told The Independent.

“This investigation tells the story of a major ongoing lobbying battle,” added Nina Holland, CEO campaigner and co-author of the Toxic Affair report. “Hundreds of documents released by the European Commission following freedom of information requests show unambiguously how science is being manipulated to defend vested interests, manufacture doubt and delay a pioneering regulation.”

May 23, 2015 Posted by | Corruption, Economics | , , , , | Leave a comment

Greek Defense Minister: ‘United States Ask for Our Support on Russian Sanctions’

By Katerina Papathanasiou | Greek Reporter | May 21, 2015

Greek Defense Minister Panos Kammenos said that the United States attempted to encourage Greece to support a new round of Russian sanctions but Athens still enjoys sharing religious and economic bonds with its “friend” and “ally,” Moscow.

After his meeting with US Under Secretary of Defense for Policy (USDP) Christine Wormuth on Wednesday, Kammenos told reporters: “I was asked to extend the sanctions, particularly in connection with Crimea. I explained [to Wormuth] that the Ukrainian issue was very sensitive for Greece as some 300,000 Greeks live in Mariupol and its neighborhood, and these people feel safe near the [Russian] Orthodox Church.” He, also, added that Greece has already lost more than €4 billion due to the Russian sanctions.

Greece’s Defense Minister has often stated in the near past that his country continues to preserve strong ties with Russia, mainly in the sector of defense contacts. In April, Kammenos revealed to Russian news agency Sputnik that Greece plans to continue military-technical collaboration with Russia while he shared Greece’s desire to settle new agreements, if the EU sanctions against Russia end soon.

Background:

U.S. Defense Secretary cancels meeting with Greek counterpart

Greek Reporter, May 20, 2015

Greek Defense Minister Panos Kammenos was snubbed by his U.S. counterpart, Ashton Carter, and Deputy Secretary of Defense Robert Work on his visit to the United States. The U.S. Defense Secretary cancelled the meeting over the weekend, claiming he has a busy schedule.

Kammenos will go to the Pentagon to meet with Under Secretary of Defense for Policy Christine Wormuth. He will also meet with Victoria Nuland, Assistant Secretary of State for European and Eurasian Affairs at the United States Department of State. Reportedly, Greek diplomats made efforts to upgrade the Greek Defense Minister’s contacts without success.

Kammenos will also have lunch with members of the U.S. House of Representatives, and meet with the Chairman of the House’s Armed Services Committee Mac Thornberry as well as Representative Frank Pallone and Senator Jack Reed.

Finally, the Greek Defense Minister will visit Lockheed Martin to discuss a 500 million dollar contract to upgrade five military aircraft.

According to analysts, the U.S. government is displeased with Greece’s new law that theoretically releases convicted terrorist Savvas Xeros. The U.S. Ambassador to Greece, David Pearce, had stated that if Xeros — who is responsible for the assassination of U.S. diplomats —  is released from prison, that would be an unfriendly act toward the U.S.

Furthermore, Greece’s flirt with Russia — initiated partly by Kammenos — and certain statements made by the Defense Minister regarding Greece joining the BRICS bank have irked U.S. officials.

Analysts say that Greek-U.S. relations are at the worst point in recent years. Especially at a time when Greece is in the middle of harsh negotiations over its debt and needs all the support it can get.

May 23, 2015 Posted by | Economics | , , , | Leave a comment

How the Uncertain Outcome of Nuclear Talks With Iran Has Taken Its Economy Hostage

By ISMAEL HOSSEIN-ZADEH | CounterPunch | May 22, 2015

I recently returned from a six-week trip to Iran. While the primary purpose of my trip was to visit family and friends, I also made some general enquiries into the state of the country’s stagnant economy. These included informal discussions with various strata of economic agents or market players: manufacturers, bankers, shopkeepers, miners, farmers, livestock breeders, workers, teachers, and more.

Sadly, most of these economic actors painted pictures of pessimism and distrust of the country’s economic conditions. The economy is mired in a protracted stagflation, with no government plan or macroeconomic policy for recovery. While the Rouhani administration boasts of having contained or slowed down the inflation, the Iranian people do not cherish that tempering of inflation as it has come about at the expense of deepened recession; that is, at the expense of heightened unemployment and weakened purchasing power. As a retired school teacher, who now works as a taxi driver, put it, lowering inflation by worsening recession is no cause for celebration (paraphrased).

And what is the major culprit behind the depressing recession? The common answer of the overwhelming majority of the economic actors I spoke with was, in a nutshell, uncertainty—uncertainty of the constantly shifting outcome of the unending nuclear negotiations. There is a clear consensus that while onerous economic sanctions against Iran are obviously damaging, the perilous effects of the protracted and uncertain outcome of the negotiations are even more devastating. Equally devastating is the current administration’s neoliberal policies of austerity economics, which have further aggravated the recession by cutting social/public spending while not offering any industrial or developmental program or planning.

Market uncertainty, combined with a regrettable lack of protection by the government of the nation’s infant industries against the more mature industries abroad, has led to an unwillingness of the country’s entrepreneurs to invest in long-term production projects. By the same token, the major bulk of the nation’s finance capital is devoted to short-term, parasitically high-yielding but unproductive investments such as buying and selling of real estate.

The largely unregulated financial sector has led to a mushrooming growth of shadow banks—known as moasesat-e etebari, or credit institutions. While there are a handful of conventional or bona fide commercial banks, the number of dubious moasesat-e etebari has in recent years skyrocketed to over 900!

There is undeniable evidence that, using the influence of corrupt and rent-seeking authorities, many of these shadow banks borrowed huge sums of money from government banks at below-market interest rates, often under the pretext of wanting to invest in job-creating or manufacturing enterprises, but in fact used the monies thus obtained for speculative purposes. In other words, most of these shadow banks came to existence not through the investment of monies owned by their founders but through that of public money!

Worse yet, many of the oligarchic borrowers and/or founders of these shadow banks now refuse to pay the monies they borrowed! And the government does not or cannot do anything about it because there is an incestuous business relationship between the two sides. Parasitic growth of these speculative shadow banks has reached unsustainably dangerous levels of an imminent implosion of the financial sector—similar to what happened in the US nearly seven years ago, which has since been transmitted to a number of European countries. It is regrettable that President Rouhani and his economic team do not seem to have learned any lessons from the disastrous experiences of the unregulated financial markets in many of the core capitalist countries.

The US and its allies are obviously aware of the fact that continued uncertainty resulting from prolonged nuclear negotiations is wreaking havoc on the Iranian economy. Perhaps this helps explain why they intend to extend the negotiations for a long time: 10, 15 or even 25 years. There are speculations that this policy is designed to help bring about regime change from within, that is, by instigating a social upheaval through an economic collapse.

Not only has the Rouhani administration thus thrown the private sector into confusion and uncertainty, it has also largely abandoned traditional public sector responsibilities in terms of macroeconomic guidance and infrastructural developments. The administration’s rudderless economic outlook is reflected (among other places) in its latest (1394, Iranian calendar) budget priorities.

“The Budget Bill, which has been produced by the newly‑revived Organization of Management and Planning, offers no explicit conceptual framework within which the budget is formulated, nor is it based on any “planning” for the economy. . . . It also does not begin with a discussion of the nation’s economic development pre-requisites nor give any indication of its trajectories.

“The key concept behind the budget is a twisted “neoliberal” model. . . . The proponents of the neoliberal economic policy support extensive economic liberalization, free trade, and reductions in government spending in order to enhance the role of the free market, individual and private sectors in the economy” [1].

The priorities of the budget bill are so warped and irrational that they tend to harm both the supply and demand sides of the economy. On the supply-side,

“[T]he budget neglects the productive sectors, infrastructure and the environment. Development funds have been increased by a nominal 16 percent; in real terms that will mean a reduction. Agriculture receives an increase, but its share is minimal relative to the sector’s need. Manufacturing remains cash-hungry given the tight-money policy and a 22 percent interest rate. R&D’s share in the GNP remains at about 0.06 percent and industry-driven R&D is almost non‑existent. Infrastructure, including transportation and urban development, is equally under-budgeted” [2].

On the demand side, except for health care spending, real or inflation-adjusted funding for most social programs has been cut. Subsidies for housing, education, food, and fuel have been reduced when the inflation rate is accounted for. The budget also fails to devote funds for the repayment of the government’s growing debt to the social security and retirement funds.

“The preference for muddling through and preserving the status quo of zero growth is evident in the uses of the budget. Thus, while the supply side of the economy is neglected, the demand side is depressed through the use of contractionary fiscal and monetary policies. The budget also disregards growth-friendly educational, industrial and trade policies while it only gives lip service to construction and infrastructure. Most significantly, the sanctions-crippled Iranian economy needs serious popular mobilization and attention to social justice, but the elite-centered budget is equally oblivious to these requirements” [3].

Since the public sector has traditionally played a major role in the building of the country’s industrialization/developmental infrastructures, the Rouhani administration’s shirking that responsibility, that is, of drastically reducing public spending on infrastructure building, has significantly contributed to the deepening of economic recession and/or the rising of unemployment.

While in light of the ongoing economic recession, this curtailment of public/social spending is certainly irrational from an objective macroeconomic standpoint (as it would aggravate the recession), it is quite rational from the standpoint of the neoliberal austerity economics, to which Mr. Rouhani and most of his economic team seem to subscribe. According to neoliberal school of economic thought, a recession must be created in order to (a) fight inflation, and (b) create conditions (in the fashion of an economic shock therapy) for a subsequent economic recovery. Such conditions would include lowering labor cost by heightening unemployment, expanding deregulation of business activities, shrinking the public sector in order to make more room for the private sector, diluting environmental and workplace safety standards, expanding privatization of public property and services, including of education and health services, and the like.

This neoliberal/austerity/supply-side prescription has since the late 1970s and early 1980s replaced the Keynesian/New Deal/Social-Democratic prescription of the previous period of nearly three decades (from mid-1940s to mid-1970s), which often relied on public-sector spending in pursuit of economic recovery. The historic switch from the New Deal to neoliberal economic paradigm took place largely in the 1980s—under the formal stewardship of President Ronald Reagan in the United States and Prime Minister Margaret Thatcher in Great Britain.

The supply-side doctrine, epitomizing the dominance of economic policy-making by big business, has since the 1980s been pursued vigorously in country after country, including now in many European countries. Having thus become the dominant economic strategy in the core capitalist countries, with devastating consequences for the overwhelming majority of the people (the so-called 99%), austerity economics has now arrived in a number of the less-developed countries, including Iran—a development which catapulted Mr. Rouhani to the seat of the country’s presidency as its messenger.

President Rouhani’s subscription to neoliberal economic doctrine is evident from his many speeches and statements, as well as from his book, National Security and Economic System of Iran [امنیت ملّی و نظام اقتصادی ایران]. In his book, Mr. Rouhani deplores Iran’s “very oppressive” labor laws to business. He argues that the minimum wage must be slashed and restrictions on the laying off of workers eliminated if Iran’s “owners of capital” are to have the “freedom” to create prosperity. “One of the main challenges that employers and our factories face,” he writes, “is the existence of labor unions. Workers should be more pliant toward the demands of job-creators” [4].

Not surprisingly, Mr. Rouhani’s economic outlook is essentially devoid of any specific development plan or industrialization project as he and most of his economic advisors subscribe to an economic doctrine that frowns upon government intervention in economic affairs—unless such interventions help “pave the way” for unfettered market operations. According to this doctrine, solutions to economic stagnation, poverty and under-development lie in unhindered market mechanism and unreserved integration into world capitalist system. Recessions, joblessness and economic hardship in many less-developed countries are not so much due to economic mismanagement or the nature of global capitalism as they are because of government intervention and/or exclusion from world capitalist markets.

This explains why Mr. Rouhani has made the solution to Iran’s economic problems contingent upon a political détente or friendly relations with the United States and its allies. The administration’s perception (or delusion) that the mere establishment of relations with the U.S. would serve as a panacea to Iran’s economic woes has essentially made Iran’s economy hostage to the unforeseeable outcome of its negotiations with the United State and, therefore, hostage to the endless, and increasingly futile, nuclear negotiations.

This also explains Mr. Rouhani’s and his nuclear negotiators’ dilemma: they have essentially trapped themselves into an illusion, the illusion that a combination of charm offensives, smiley faces and diplomatic niceties would suffice to change imperialist policies toward Iran. In reality, however, the U.S. policy toward Iran (or any other country, for that matter) is based on an agenda—an imperialistic agenda that consists of a series of demands and expectations, not on diplomatic decorum, or the type of language its leaders use.

One would expect that the market uncertainty created by nuclear negotiations may have led Iran’s producers of industrial and agricultural products to be eagerly looking forward to a breakthrough in the negotiations and a lifting of the brutal sanctions against their economy. My discussions with a number of manufacturers and farmers revealed, however, that while they certainly suffer from the oppressive economic sanctions, they are also concerned that, in light of President Rouhani’s neoliberal free trade policies, a relief from sanctions that may result from such a breakthrough may, in fact, end up driving them out of business by further opening the domestic market to an unbridled deluge of foreign products.

For example, Mahmoud Sedaqat, vice president of the Association of UPVC Window & Door Profiles Manufacturers, bitterly complained that while domestic production capacity of this petrochemical is more than twice as much as domestic needs, the government recently reduced import tariffs for this product from 30% to 15%, thereby paving the way for the substitution of imports for domestic products. Sedaqat further pointed out that government’s careless trade policy and a lack of protection for domestic producers has led to an atmosphere of confusion and uncertainty among domestic producers, which is contributing to further aggravation of the ongoing economic stagnation [5].

Mohammed Reza A’le Sara, a representative of domestic producers of automobile tires, likewise complained about a glaring lack of protection of his industry against the unrestrained imports of similar, indeed substitutable, products from abroad. A’le Sara also pointed out that, despite the comparable quality of domestically-produced tires, 50% of domestic demand is currently supplied by imports. A careful or calculated government support for domestic producers, he further argued, could gradually but certainly make Iran self-sufficient in this industry [6].

Mohammed Serfi, an economics analyst, recently pointed out that the degree of import-substitution in Iran could be as high as 70%; meaning that as much as 70% of Iran’s imports could be substituted by domestically produced goods. Yet, due to the Rouhani administration’s warped open-door/free-trade policy, the crucially important industrialization strategy of import-substitution—pursued by all the currently more developed countries at earlier stages of their development—is ignored. [7].

Complaining about the administration’s lack of an economic strategy, Gholam-Hosein Shafe-ei, Chairman of Iran’s Chamber of Commerce, also argued that while relief from economic sanctions is obviously necessary it is not sufficient; perhaps more importantly are government-championed macroeconomic objectives and carefully-guided ways or plans to achieve those objectives. In the absence of clearly defined economic objectives and the concomitant strategies of import-substitution and export-promotion, Shafe-ei reasoned, Iran could become a heaven for foreign producers while many of domestic producers would be driven out of business.

Under President Rouhani, farmers have suffered even more than manufacturers. Since he was elected nearly two years ago, his administration has raised the energy/utilities bill by anywhere between 50% and 80%. This has drastically heightened the cost of agricultural production, as it has of industrial production. Additionally, the government has in recent years changed both the provision and distribution structure of fertilizers, increasingly shifting those responsibilities from the public to the private sector. This has further added to the cost of production. The government has also failed to establish a meaningful policy of crop insurance or financial assistance in the face of various natural disasters such as floods, drought and other climate fluctuations. Combined with the administration’s misguided free trade policy, which has greatly facilitated the import of many agricultural products, these ill-advised policies have effectively driven many farmers out of business, thereby plunging the agricultural sector into a deep recession.

Prior to the Rouhani administration’s pursuit of neoliberal economic policies, Iran viewed economic sanctions as an (unsolicited) opportunity to become self-reliant: to rely on domestic talents and resources in order to become self-sufficient by producing as many of the consumer goods and other industrial products as possible. And it did, indeed, make considerable progress in scientific research, technological know-how and manufacturing industries.

For example, prior to the recent rise of neoliberal economic policies, which have greatly undermined Iran’s manufacturing and agricultural capabilities, Iran had become self-sufficient in producing many of its industrial products such as home and electric appliances (television sets, washers and dryers, refrigerators, washing machines, and the like), textiles, leather products, pharmaceuticals, agricultural products, processed food, and beverage products (including refined sugar and vegetable oil). The country had also made considerable progress in manufacturing steel, copper products, paper, rubber products, telecommunications equipment, cement, and industrial machinery.

None of the oppressive economic sanctions in retaliation for the 1979 revolution deterred Iran from forging ahead with its economic development and industrialization plans. The Rouhani administration’s misguided and haphazard switch from that tradition of inward-looking strategy of self-relying economic development to the ill-conceived outward-looking strategy has thrown tens of thousands of small and medium-sized industrial and agricultural producers into a market atmosphere of confusion and uncertainty. As has already been pointed out, the uncertainty stems from two major sources: (1) a glaring lack of protection of domestic producers against the more competitive foreign producers, and (2) a regrettable linkage or tying of any macroeconomic policy to the unending, unpredictable and, ultimately, futile results of the nuclear negotiations.

The inordinately high priority given to the dubious nuclear negotiations, which has sadly taken most of the Rouhani administration’s time and energy at the expense of everything else, has place the urgently needed macroeconomic policies on hold. The sooner such unduly delayed policies are delinked from the fraudulent imperialist game of nuclear negotiations the better.

More fundamentally, the sooner the nuclear talks are seen (or acknowledged) for what they really are—a pretext or a ploy on the part of the US and its allies, both inside and outside Iran, to adapt the country into another “client state”—and dealt with accordingly, the better. So far, Iran’s negotiating team has successfully concealed many of the gratuitous concessions they have made during the negotiations—essentially suspending the nation’s hard-earned nuclear science and technology while having gained no meaningful relief from sanctions—from the Iranian people. Whether they will succeed in continuing to sell a fraudulent deal to the Iranian people, or whether they may face a harsh backlash when the people learn of the deceitful nature or substance of the deal remains to be seen.

ismaelhzIsmael Hossein-zadeh is Professor Emeritus of Economics (Drake University). He is the author of Beyond Mainstream Explanations of the Financial Crisis (Routledge 2014), The Political Economy of U.S. Militarism (Palgrave–Macmillan 2007), and the Soviet Non-capitalist Development: The Case of Nasser’s Egypt (Praeger Publishers 1989). He is also a contributor to Hopeless: Barack Obama and the Politics of Illusion.

References

[1] Hooshang Amirahmadi, “Iran’s Neoliberal Austerity-Security Budget”

[2] Ibid.

[3] Ibid.

[4] As excerpted by Keith Jones, “Iranian president declares country ‘open for business’”

[5] Mahmood Sedaqat, “کاهش تعرفه پروفیل «یوپی‌وی‌سی» ضربه دولت به تولید داخلی است,” Kayhan, Mordad 25, 1393 (August 16, 2014).

[6]. Interview with A’le Sara, in Farsi: واردات بیش از 50 درصد لاستیک علی‌رغم توان تولید داخلی

[7] Mohammed Serfi, “Gentlemen, the Party is Over,” in Farsi: آقایان! ضیافت تمام شد!(یادداشت روز)

May 22, 2015 Posted by | Economics | , | Leave a comment

Exxon lobbies US government on Iran sanctions

Press TV – May 22, 2015

Exxon Mobil is reported to have stationed lobbyists to push the envelope on Iran sanctions with the US government as Western companies are jostling for access to the Middle East country’s massive oil and gas fields.

According to Bloomberg, the Texas-based oil company has hired a lobbying firm founded by former Republican Senator Don Nickles to press the US government on lifting sanctions against Tehran.

Western companies are eager to work on Iranian fields because they are among the largest and cheapest to develop, it quoted on economist as saying.

“Given sanctions and the dilapidation of oilfields over time, it looks like it’d be a lot of work” for foreign companies, Allen Good, a Chicago-based analyst at Morningstar Inc. told Bloomberg.

“But unlike Iraq, you’d don’t have a civil war going on so it’d be an easier path to growing production. You could get a pretty good bump pretty quickly,” he said.

Western companies are holding their breath as nuclear negotiations between Iran and the US and other members of the P5+1 group are heading to the decisive round.

Political factors 

Expectations of a final agreement and consequent removal of sanctions have put energy entities on the watch but those hopes are being sapped by reports that the West was hunkering down for “excessive demands”.

The US government reasserted its obdurate position on Thursday by announcing sanctions on two Arab airlines for selling nine used commercial aircraft to Iran.

While the direction of the talks remains unclear, foreign companies are vying to forge initial links with Iran.

On Thursday, CEO of Italy’s Eni SpA Claudio Descalzi said he traveled to Tehran two weeks ago. Speaking to La Repubblica, Descalzi said Iran could “start attracting investment” from foreign companies again if a nuclear deal was sealed.

Eni and other major European energy giants left Iran after the US intensified sanctions on the country.

American companies are banned from any business with Iran under a US law which has effectively been in place since the 1979 Islamic Revolution.

On Tuesday, President Barack Obama renewed unilateral US restrictions on purchases of oil and oil products from Iran.

Exxon business in Iran goes back to the period before the revolution when the shah was a close ally of the United States.

No problem 

Earlier this week, an Iranian oil ministry official said the country’s oil and gas is open to American investment but US companies have to tie up with Iranian companies under certain terms.

“From the government’s standpoint, there is no limitation for oil investment by the Americans in Iran,” deputy Minister of Petroleum Amir Hossein Zamaninia said.

The official said European and American companies are showing strong interest for investment in Iran’s oil and gas industries.

“Over the past couple of months, not one or two companies but several American entities have announced readiness to invest and participate in Iran’s oil industry projects if sanctions are annulled.”

Zamaninia said most US companies have proposed to partner with other companies for investments as he spelled out Iran’s conditions.

“The pattern for partnership and investment of American companies in Iran’s oil and gas industry has to be based on the trade package which has been earmarked to the Iranian private sector,” he said.

May 22, 2015 Posted by | Economics, Wars for Israel | , | Leave a comment

Obama renews ban on Iran oil trade

Press TV – May 20, 2015

In a decree, issued by his office, the US president said that “global economic conditions, increased oil production by certain countries, and the level of (oil) spare capacity” had allowed him to take the decision.

Saudi Arabia, a key US ally in the Middle East, has ramped up production leading to a crash in crude prices.

“I determine … that there is a sufficient supply of petroleum and petroleum products from countries other than Iran to permit a significant reduction in the volume of petroleum and petroleum products purchased from Iran by or through foreign financial institutions,” Obama said in his statement.

The statement also referred to a US measure which forbids transactions with Iran.

Under the measure, foreign companies are cut off from the US financial system and face sanctions if they engage in transactions with Iran’s financial institutions.

However, a preliminary agreement reached in Nov. 2013 allows Iran to sell around 1 million barrels per day of crude oil.

The US restrictions fly in the face of that agreement under which no new sanctions should be imposed on the Islamic Republic.

Washington contends the agreement does not include renewal of the previous restrictions.

The US and five other countries are currently discussing a possible final agreement with Iran by the end of June.

Iran says any deal should envisage immediate removal of all sanctions, with the US saying they should be lifted gradually.

May 21, 2015 Posted by | Economics, Progressive Hypocrite | , , | Leave a comment

Los Angeles to raise minimum wage to $15 by 2020

RT | May 20, 2015

The Los Angeles City Council agreed to raise the city’s minimum wage by more than a dollar per hour each year until the amount reaches $15 an hour by 2020, city officials said on Tuesday. The measure would affect the finances of 800,000 people.

Based on a 40-hour workweek, the raise would amount to an additional $48 a week or approximately $2,000 a year before taxes for the next five years. Los Angeles is now the largest city to adopt major a minimum-wage increase, joining three others that have passed similar legislation: Chicago, San Francisco and Seattle. The move also puts pressure on other large urban centers, such as New York, to do the same.

“Make no mistake,” said Councilman Paul Krekorian, the measure’s sponsor, according to the Los Angeles Times. “Today the city of Los Angeles, the second-biggest city in the nation, is leading the nation.”

The measure also ties yearly wage increases to the consumer price index starting in 2022. In Krekorian’s original measure, an amendment was included that would have required employers to grant workers 12 paid days off each year. There was a huge outcry from the business community, however, and the amendment was dropped before Tuesday’s vote. It will be considered again as separate legislation.

The wage increase measure will now go to the city attorney’s office to be drafted as an ordinance, and then back to the City Council for approval later this year, before finally being signed into law by the Mayor. The first increase to go into effect will push the minimum wage from $9 per hour up to $10.50 in July 2016.

The City Council’s 14-1 vote on the measure did not come without inducement. Corporate employers have been reluctant to increase hourly pay rates despite record profits, and have left it largely up to politicians to try to solve the problem of stagnating wages, as the cost of living continues to increase.

The much-publicized efforts of the Service Employees International Union to support fast food workers in their quest for a $15 wage have been effective in raising the bar for wages. As part of the campaign, it publicized how corporations have been relying on state subsidies, such as food stamps and housing support, to supplement their employees’ wages.

Critics, many of them business leaders, say the increase will turn the city into a“wage island,” pushing businesses away into places outside the city limits where they can pay employees less.

“They are asking businesses to foot the bill on a social experiment that they would never do on their own employees,” Stuart Waldman, president of the Valley Industry and Commerce Association trade group, told the New York Times.

“A lot of businesses aren’t going to make it. It’s great that this is an increase for some employees, but the sad truth is that a lot of employees are going to lose their jobs.”

May 21, 2015 Posted by | Economics | , , | Leave a comment

Monsanto’s Worst Fear May Be Coming True

By Jonathan Latham, PhD | Independent Science News | May 18, 2015

The decision of the Chipotle restaurant chain to make its product lines GMO-free is not most people’s idea of a world-historic event. Especially since Chipotle, by US standards, is not a huge operation. A clear sign that the move is significant, however, is that Chipotle’s decision was met with a tidal-wave of establishment media abuse. Chipotle has been called irresponsible, anti-science, irrational, and much more by the Washington Post, Time Magazine, the Chicago Tribune, the LA Times, and many others. A business deciding to give consumers what they want was surely never so contentious.

The media lynching of Chipotle has an explanation that is important to the future of GMOs. The cause of it is that there has long been an incipient crack in the solid public front that the food industry has presented on the GMO issue. The crack originates from the fact that while agribusiness sees GMOs as central to their business future, the brand-oriented and customer-sensitive ends of the food supply chain do not.

The brands who sell to the public, such as Nestle, Coca-Cola, Kraft, etc., are therefore much less committed to GMOs. They have gone along with their use, probably because they wish to maintain good relations with agribusiness, who are their allies and their suppliers. Possibly also they see a potential for novel products in a GMO future.

However, over the last five years, as the reputation of GMOs has come under increasing pressure in the US, the cost to food brands of ignoring the growing consumer demand for GMO-free products has increased. They might not say so in public, but the sellers of top brands have little incentive to take the flack for selling GMOs.

From this perspective, the significance of the Chipotle move becomes clear. If Chipotle can gain market share and prestige, or charge higher prices, from selling non-GMO products and give (especially young) consumers what they want, it puts traditional vendors of fast and processed food products in an invidious position. Kraft and MacDonalds, and their traditional rivals can hardly be left on the sidelines selling outmoded products to a shrinking market. They will not last long.

MacDonald’s already appears to be in trouble, and it too sees the solution as moving to more up-market and healthier products. For these much bigger players, a race to match Chipotle and get GMOs out of their product lines, is a strong possibility. That may not be so easy, in the short term, but for agribusiness titans who have backed GMOs, like Monsanto, Dupont, Bayer and Syngenta; a race to be GMO-free is the ultimate nightmare scenario.

Until Chipotle’s announcement, such considerations were all behind the scenes. But all of a sudden this split has spilled out into the food media. On May 8th, Hain Celestial told The Food Navigator that:

“We sell organic products… gluten-free products and… natural products. [But] where the big, big demand is, is GMO-free.”

According to the article, unlike Heinz, Kraft, and many others, Hain Celestial is actively seeking to meet this demand. Within the food industry, important decisions, for and against GMOs, are taking place.

Why the pressure to remove GMOs will grow

The other factor in all this turmoil is that the GMO technology wheel has not stopped turning. New GMO products are coming on stream that will likely make crop biotechnology even less popular than it is now. This will further ramp up the pressure on brands and stores to go GMO-free. There are several contributory factors.

The first issue follows from the recent US approvals of GMO crops resistant to the herbicides 2,4-D and Dicamba. These traits are billed as replacements for Roundup-resistant traits whose effectiveness has declined due to the spread of weeds resistant to Roundup (Glyphosate).

The causes of the problem, however, lie in the technology itself. The introduction of Roundup-resistant traits in corn and soybeans led to increasing Roundup use by farmers (Benbrook 2012). Increasing Roundup use led to weed resistance, which led to further Roundup use, as farmers increased applications and dosages. This translated into escalated ecological damage and increasing residue levels in food. Roundup is now found in GMO soybeans intended for food use at levels that even Monsanto used to call “extreme” (Bøhn et al. 2014).

The two new herbicide-resistance traits are set to recapitulate this same story of increasing agrochemical use. But they will also amplify it significantly,

The specifics are worth considering. First, the spraying of 2,4-D and Dicamba on the newer herbicide-resistant crops will not eliminate the need for Roundup, whose use will not decline (see Figure).

Predicted herbicide use to 2025 (Mortensen et al 2012)

Predicted herbicide use to 2025 (Mortensen et al 2012)

That is because, unlike Roundup, neither 2,4-D nor Dicamba are broad-spectrum herbicides. They will have to be sprayed together with Roundup, or with each other (or all of them together) to kill all weeds. This vital fact has not been widely appreciated.

Confirmation comes from the companies themselves. Monsanto is stacking (i.e. combining) Dicamba resistance with Roundup resistance in its Xtend crops and Dow is stacking 2,4-D resistance with Roundup resistance in its Enlist range. (Notably, resistance to other herbicides, such as glufosinate, are being stacked in all these GMO crops too.)

The second issue is that the combined spraying of 2,4-D and Dicamba and Roundup, will only temporarily ease the weed resistance issues faced by farmers. In the medium and longer terms, they will compound the problems. That is because new herbicide-resistant weeds will surely evolve. In fact, Dicamba-resistant and 2,4-D-resistant weeds already exist. Their spread, and the evolution of new ones, can be guaranteed (Mortensen et al 2012). This will bring greater profits for herbicide manufacturers, but it will also bring greater PR problems for GMOs and the food industry. GMO soybeans and corn will likely soon have “extreme levels” of at least three different herbicides, all of them with dubious safety records (Schinasi and Leon 2014).

The first time round, Monsanto and Syngenta’s PR snow-jobs successfully obscured this, not just from the general public, but even within agronomy. But it is unlikely they will be able to do so a second time. 2,4-D and Dicamba-resistant GMOs are thus a PR disaster waiting to happen.

A pipeline full of problems: risk and perception

The longer term problem for GMOs is that, despite extravagant claims, their product pipeline is not bulging with promising ideas. Mostly, it is more of the same: herbicide resistance and insect resistance.

The most revolutionary and innovative part of that pipeline is a technology and not a trait. Many products in the GMO pipeline are made using RNA interference technologies that rely on double-stranded RNAs (dsRNAs). dsRNA is a technology with two problems. One is that products made with it (such as the “Arctic” Apple, the “Innate” Potato, and Monsanto’s “Vistive Gold” Soybeans) are unproven in the field. Like its vanguard, a Brazilian virus-resistant bean, they may never work under actual farming conditions.

But if they do work, there is a clear problem with their safety which is explained in detail here (pdf).

In outline, the problem is this: the long dsRNA molecules needed for RNA interference were rejected long ago as being too hazardous for routine medical use (Anonymous, 1969). The scientific literature even calls them “toxins”, as in this paper title from 1969:

Absher M., and Stinebring W. (1969) Toxic properties of a synthetic double-stranded RNA. Nature 223: 715-717. (not online)

As further evidence of this, long dsRNAs are now used in medicine to cause autoimmune disorders in mice, in order to study these disorders (Okada et al 2005).

The Absher and Stinebring paper comes from a body of research built up many years ago, but its essential findings have been confirmed and extended by more modern research. We now know why dsRNAs cause harm. They trigger destructive anti-viral defence pathways in mammals and other vertebrates and there is a field of specialist research devoted to showing precisely how this damages individual cells, whole tissues, and results in auto-immune disease in mice (Karpala et al. 2005).

The conclusion therefore, is that dsRNAs that are apparently indistinguishable from those produced in, for example, the Arctic apple and Monsanto’s Vistive Gold Soybean, have strong negative effects on vertebrate animals (but not plants). These vertebrate effects are found even at low doses. Consumers are vertebrate animals. They may not appreciate the thought that their healthy fats and forever apples also contain proven toxins. And on a business front, consumer brands will not relish defending dsRNA technology once they understand the reality. They may not wish to find themselves defending the indefensible.

The bottom line is this. Either dsRNAs will sicken or kill people, or, they will give opponents of biotechnology plenty of ammunition. The scientific evidence, as it currently stands, suggests they will do both. dsRNAs, therefore, are a potentially huge liability.

The last pipeline problem stems from the first two. The agbiotech industry has long held out the prospect of “consumer benefits” from GMOs. Consumer benefits (in the case of food) are most likely to be health benefits (improved nutrition, altered fat composition, etc.). The problem is that the demographic of health-conscious consumers no doubt overlaps significantly with the demographic of those most wary of GMOs. Show a consumer a “healthy GMO” and they are likely to show you an oxymoron. The likely health market in the US for customers willing to pay more for a GMO has probably evaporated in the last few years as GMOs have become a hot public issue.

The end-game for GMOs?


The traditional chemical industry approach to such a problem is a familiar repertoire of intimidation and public relations. Fifty years ago, the chemical industry outwitted and outmanoeuvered environmentalists after the death of Rachel Carson (see the books Toxic Sludge is Good for You and Trust Us We’re Experts). But that was before email, open access scientific publication, and the internet. Monsanto and its allies have steadily lost ground in a world of peer-to-peer communication. GMOs have become a liability, despite their best efforts.

The historic situation is this: in any country, public acceptance of GMOs has always been based on lack of awareness of their existence. Once that ignorance evaporates and the scientific and social realities start to be discussed, ignorance cannot be reinstated. From then on the situation moves into a different, and much more difficult phase for the defenders of GMOs.

Nevertheless, in the US, those defenders have not yet given up. Anyone who keeps up with GMOs in the media knows that the public is being subjected to an unrelenting and concerted global blitzkrieg.

Pro-GMO advocates and paid-for journalists, presumably financed by the life-science industry, sometimes fronted by non-profits such as the Bill and Melinda Gates Foundation, are being given acres of prominent space to make their case. Liberal media outlets such as the New York Times, the National Geographic, The New Yorker, Grist magazine, the Observer newspaper, and any others who will have them (which is most) have been deployed to spread its memes. Cornell University has meanwhile received a $5.6 million grant by the Gates Foundation to “depolarize” negative GMO publicity.

But so far there is little sign that the growth of anti-GMO sentiment in Monsanto’s home (US) market can be halted. The decision by Chipotle is certainly not an indication of faith that it can.

For Monsanto and GMOs the situation suddenly looks ominous. Chipotle may well represent the beginnings of a market swing of historic proportions. GMOs may be relegated to cattle-feed status, or even oblivion, in the USA. And if GMOs fail in the US, they are likely to fail elsewhere.

GMO roll-outs in other countries have relied on three things: the deep pockets of agribusinesses based in the United States, their political connections, and the notion that GMOs represent “progress”. If those three disappear in the United States, the power to force open foreign markets will disappear too. The GMO era might suddenly be over.

Endnote: The report by Jonathan Latham and Allison Wilson on RNA interference and dsRNAs in GMO crops is downloadable from here. Accompanying Tables are here.

References

Anonymous (1969) Interferon inducers with side effects. Nature 223: 666-667.
Bøhn, T., Cuhra, M., Traavik, T., Sanden, M., Fagan, J. and Primicerio, R. 2014. Compositional differences in soybeans on the market: Glyphosate accumulates in Roundup Ready GM soybeans. Food Chemistry 153: 207-215.
Okada C., Akbar S.M.F., Horiike N., and Onji M. (2005) Early development of primary biliary cirrhosis in female C57BL/6 mice because of poly I:C administration. Liver International 25: 595-603.
Karpala A.J., Doran T.J., and Bean A.G.D. (2005) Immune responses to dsRNA: Implications for gene silencing technologies. Immunology and cell biology 83: 211–216.
Mortensen, David A., J. Franklin Egan, Bruce D. Maxwell, Matthew R. Ryan and Richard G. Smith (2012) Navigating a Critical Juncture for Sustainable Weed Management. BioScience 62: 75-84.
Schinasi L and Maria E. Leon ME (2014) Non-Hodgkin Lymphoma and Occupational Exposure to Agricultural Pesticide Chemical Groups and Active Ingredients: A Systematic Review and Meta-Analysis. Int. J. Environ. Res. Public Health 11: 4449-4527.

May 20, 2015 Posted by | Economics, Mainstream Media, Science and Pseudo-Science | | Leave a comment

IRNA: Israel ordered to pay Iran $1.1 billion

Press TV – May 20, 2015

An Israeli oil company has been ordered by a Swiss court to pay $1.1 billion to Iran in compensation in a long-standing legal battle related to a joint venture before the Islamic Revolution, the IRNA news agency says.

Citing an “informed source” at Iran’s Presidential Center for Legal Affairs, IRNA said the ruling relates to the Israeli company’s sale of Iranian oil and withholding the money.

Iran has been conducting three arbitration suits against Israel at French and Swiss courts in a legal tussle estimated worth several billion dollars.

The case relates to a joint venture established in 1968 under the defunct shah of Iran to ship the country’s oil to the Israeli port of Eilat in the Mediterranean for export to Europe.

Iran cancelled the contract after the Islamic Revolution of 1979 because the country doesn’t recognize Israel.

Tel Aviv, instead, expropriated Iran’s assets and launched its own litigation offensive against the Islamic Republic, which has been dismissed at international courts.

According to IRNA, the latest ruling pertains to a case related to the National Iranian Oil Company (NIOC)’s delivery of 14.75 million cubic meters of crude oil worth $450 million to Israel’s Trans-Asiatic Oil Ltd. or TAO.

In 1989, the Swiss court initially ordered TAO to pay $500 million to Fimarco Anstalt, a company registered before the revolution in Lichtenstein by NIOC.

The court put off proceedings for interest claims then, issuing a final ruling only this month, which ordered TAO to pay $1.1 billion in addition to $7 million in legal fees, IRNA quoted the source as saying.

The source said Iran has also launched a case against TAO in Panama’s courts for implementation of the ruling and original claims against the Israeli firm.

Switzerland’s Federal Supreme Court has reportedly allowed Iranian clients to file an arbitration claim for $7 billion against Israel.

The original claim is related to Iran’s shares in the Eilat-Ashkelon Pipeline Co. (EAPC), as well as two oil ports and storage facilities, and a fleet of tankers which have been expropriated by Israel.

The Tel Aviv regime has issued a secrecy order under which any information about the company’s operations and news of arbitration is subject to military censorship.

The EAPC, part of TAO, is one of the most secretive companies in Israel, operating under a special legal force since 1968.

The company enjoys immunity from public control and regime supervision including its comptroller as well as the Knesset and the media.

The Eilat-Ashkelon Pipeline Co. was built in the aftermath of the Sinai operation of 1956 against Arab armies.

During the years that Israel controlled Sinai, Israel stole pumps and pipes from Italian and Belgian firms operating oil fields in the peninsula and built the pipeline from Eilat.

May 20, 2015 Posted by | Economics | , | Leave a comment

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