Obama’s People Show Their True Colors
By David McCarey | CounterPunch | June 27, 2014
For those who wondered what happened to Robert Gibbs, President Obama’s former campaign advisor and mealy-mouthed White House press secretary, he has resurfaced in the private sector. He is the co-founder of Incite Agency, an upscale public relations firm. Apparently, going from an underpaid shill for the White House to an overpaid shill for Corporate America was a seamless (and guiltless) transition.
Gibbs’ public relations company’s first major assignment is going to be a real whopper. Hold on to your seat. Incite Agency is going to launch a national public relations campaign aimed at destroying America’s teachers’ unions. It’s true. Gibbs and company have announced that they will be preparing the groundwork for lawsuits across the country, challenging tenure and other teachers’ job protection.
When you consider that Obama has surrounded himself with anti-union people (Rahm Emanuel, Arne Duncan, Eric Holder, et al), this vile announcement should come as no surprise, not to people who’ve been paying attention. Still, the naked audacity and venality of the move caught some of us off-guard. We’re reminded of that Lily Tomlin line: “I worry that no matter how cynical I become, it’s never going to be enough.”
If people out there—say parents—were truly and sincerely opposed to school teachers receiving tenure, believing that union protection somehow contributed to “substandard education” (which every study ever conducted has refuted), one could almost forgive their ignorance. Not knowing the facts, all that these good people want is a decent education for their kids, for America’s kids, and no one should ridicule that.
But this anti-teacher campaign has nothing to do with improving education. It has as much to do with that as “designer water” has to do with improving people’s health. Some ambitious guys simply got together and figured out a way to get people to reject municipal water. By pretending that plastic water was somehow better than tap (even though municipal standards are higher), they were able to carve out a new market. Getting people to pay for something they could otherwise get free is no small feat.
These same guys (the ones who want more toll roads and want to charge fees for walking on hiking trails) now want to privatize America’s public education system. The prospect of millions of families willing to pay for something that they could otherwise get free has these covetous money-grubbers positively drooling. This would be a bonanza for the ruling class. But it’s tricky. It’s a big move. How do they pull off something like that?
Obviously, they can’t compare resumes or backgrounds or certification. Obviously, they can’t mention the fact that public school teachers are required to have not only a college degree but a teaching credential. They can’t mention it because of the embarrassing fact that private school teachers aren’t required to have either.
Private school teachers require less certification and are paid less. Yet these entrepreneurs want people to believe private schools somehow attract the best teachers. That argument wouldn’t work for doctors. You couldn’t convince people that the best physicians were the ones with the least education and lowest salaries. So how do they convince them that privatization is a smart move? They do it by demonizing the labor unions that represent the teachers.
Given that there is a massive public relations smear-job loose upon the land, it is incumbent upon the AFL-CIO to respond in kind. The House of Labor has money to spend. They need to spend it wisely. Instead of blowing it on futile organizing drives (e.g., Wal-Mart), they should focus their energy on speaking frankly with the American public. Convince them that they’re being played for suckers. There is still time.
David Macaray is a labor columnist and author (“It’s Never Been Easy: Essays on Modern Labor, 2nd Edition). dmacaray@earthlink.net
Ukraine and EU sign free trade zone deal
RT | June 27, 2014
Ukraine has signed the economic part of the Association Agreement with the EU, with Georgia and Moldova also joining the pact, even though big economic risks lie ahead.
The signing of the economic part of the agreement comes after 8 months of violent unrest in Ukraine, which broke out in Kiev and spread across the country in November after then-President Viktor Yanukovich decided to reject the trade agreement in favor of trilateral talks.
The document contains 31 signatures – Ukraine, all 28 EU member states, as well as that of the President of the European Council Herman Van Rompuy, and European Commission President Jose Manuel Barroso. The agreement will only come into force when it is ratified by every national parliament in the EU. It is expected that the ratification process will be complete by this fall.
Georgia and Moldova also signed both political and economic parts of the Association Agreement. Ukraine signed a political part of the agreement in March, shortly after Crimea rejoined Russia.
“By signing the association agreement, Ukraine, like European nation, which shares the same rules of law, stresses its sovereign choice to become a member of the EU Association Agreement in the future,” said Ukraine’s President Poroshenko before the signing ceremony. The Ukrainian President sees the trade document as a stepping stone to eventual EU statehood.
Friday signing the Free Trade Agreement will open up trade barriers between the former Soviet states, but doesn’t guarantee them EU membership, a main goal of the three governments.
“It is their sovereign right, but the Russian Federation will have to take measures in case it negatively effects the local market,” Dmitry Peskov, Putin’s spokesperson said, commenting on the agreements signed between the EU and Ukraine, Georgia and Moldova.
Russia has warned these “measures” could include $500 billion in lost trade and possible bans on Ukrainian imports.
“There is no economic growth to be had by suddenly having western European goods dumped at low cost on your marketplace,” Patrick Young, an expert on emerging markets, told RT.
In order to fully implement the free trade zone, it could cost Ukraine’s already fragile economy an additional $104 billion, according to a previous estimate by Yanukovich. This will include adopting hundreds of new trade laws and thousands of new laws to comply with EU standards.
In 2013, EU exports to Ukraine were worth $33 billion (23.9 billion euro), dominated by industrial equipment, chemicals, and manufactured goods.
Ukraine exported 13.8 billion euro worth of goods to the EU, mostly materials like iron, steel, and minerals. Agricultural and food products are also substantial exports.
The Association Agreement and Deep and Comprehensive Free Trade Area (DCFTA) will replace the current Partnership and Cooperation Agreement Ukraine signed with the EU in 1998.
Eastern Ukraine, which rejects the new Ukrainian government’s authority, is skeptical of Kiev’s European ambition, as is the EU itself.
“EU is not ready to integrate at this stage a country like Ukraine,” Jose Barroso, President of the European Commission said before the talks.
Brussels started the Eastern Partnership initiative to incorporate six former Soviet Republics into the EU free trade zone. Ukraine, Moldova, and Georgia have followed Poland’s example, whereas Armenia, Belarus, and Azerbaijan are likely to opt for closer trade links with Russia.
Trilateral trade talks between the EU, Russia, and Ukraine will take place on July 11. Russia has made it very clear that by signing the trade agreement Ukraine can no longer enter the Eurasian Customs Union, which already includes Belarus and Kazakhstan.
Germany gives Verizon the boot over NSA spying scandal
RT | June 26, 2014
Citing concerns over the NSA’s wiretapping of Chancellor Angela Merkel and other top officials’ phones, the German Interior Ministry announced Thursday that it will not renew its contract with Verizon to provide service for government ministries.
As part of an effort to revamp its secure communications networks, the country will instead rely on Germany’s Deutsche Telekom, Reuters reported.
Since the beginning of the NSA scandal, US businesses have expressed concern over the potential blowback of the revelations on their bottom lines. Fearing foreign governments and other firms will no longer trust them to provide secure products and services, they’ve pushed back against the government, demanding more transparency of how the intelligence community operates.
Verizon is one of the first companies that can point to the NSA as a direct cause for a failed business deal. The Interior Ministry released a statement Thursday, saying “the ties revealed between foreign intelligence agencies and firms in the wake of the U.S. National Security Agency affair show that the German government needs a very high level of security for its critical networks.”
Although it was the first company outed by journalist Glenn Greenwald and British newspaper The Guardian as providing the NSA with millions of instances of metadata on a daily basis, Verizon is not the only – or necessarily the first – to do so.
As far back as 2001, the NSA reportedly collected data from AT&T by re-routing information on its network to government computers. Reporting by Wired revealed documents from AT&T technician Mark Klein showing how the feat was accomplished using hardware in a now famous secret room at the company’s San Francisco data center.
Though the US and Germany are allies, documents released over the past year by whistleblower Edward Snowden revealed an American intelligence community with access to a wide variety of German communications. The fallout has been a chilling of relations between the two nations, with the Bundestag (German parliament) especially fierce in its criticisms and demands for answers from the US.
To the consternation of American officials hoping to prosecute Snowden for espionage, the German parliament even invited the leaker to testify about the NSA’s practices in a formal hearing.
Chancellor Merkel, however, has a mixed history with demanding answers from the US.
At first reacting with outrage and comparing the NSA to the Stasi – the communist East German secret police – she also demanded the two nations agree to a “no-spying” pact.
Her attitude changed markedly, however, after meeting with President Barack Obama in May. Stressing the need for unity, Merkel attempted to brush the scandal that has outraged German citizens under the rug. This was not received warmly by opposition parties and many of her constituents, a large number of whom view Snowden as a hero.
Meanwhile, further allegations regarding US surveillance continue to be brought forward. According to a report recently published by the German newspaper Süddeutsche Zeitung , NDR and WDR, the NSA had been given access to large swaths of telecoms data by the country’s Federal Intelligence Service (BND). For at least three years raw data was fed directly to the US agency out of Frankfurt — the city is a telecoms hub for much of Europe and beyond.
The former Minister of the Interior, Hans-Peter Friedrich, declared last year that if a foreign intel service had been given a tap into the telecoms node in Frankfurt, it would be a violation of Germany’s sovereignty.
Tired of World Bank, China to launch alternative
RT | June 26, 2014
China is moving forward with a plan to create its own version of the World Bank, which will rival institutions that are under the sway of the US and the West. The bank will start with $100 billion in capital.
The Asian Infrastructure Investment Bank (AIIB) will extend China’s financial reach and compete not only with the World Bank, but also with the Asian Development Bank, which is heavily dominated by Japan. The $100 billion in capital is double that originally proposed, the Financial Times (FT) reported.
A member of the World Bank, China has less voting power than countries like the US, Japan, and the UK. It is in the ‘Category II’ voting bloc, giving it less of a voice. In the Asian Development Bank, China only holds a 5.5 percent share, compared to America’s 15.7 percent share and Japan’s 15.6 share.
At the International Monetary Fund, China pays a 4 percent quota, whereas the US pays nearly 18 percent, and therefore has more influence within the organization and where loans go.
“China feels it can’t get anything done in the World Bank or the IMF so it wants to set up its own World Bank that it can control itself,” the FT quoted a source close to discussions as saying.
To date, 22 countries have expressed interest in the project, including oil-rich Middle Eastern nations, the US, India, Europe, and even Japan, the FT reported.
“There is a lot of interest from across Asia but China is going to go ahead with this even if nobody else joins it,” the FT source said.
Funding for the Asian Infrastructure Investment Bank will mostly be sourced from the People’s Republic of China and be used to pay for infrastructure projects.
The bank’s first project will be a reincarnation of the ancient Silk Road, the vast network of trade routes between China and its regional neighbors. Another proposed project is a railway from Beijing to Baghdad.
The idea for the bank was first floated in October 2013, when China unveiled plans to create the bank. Then it was initially to be funded with $50 billion in capital.
Separately, the BRICS nations plan to have a $100 billion development bank ready by 2015.
Funds will be reserved for emerging market members who are often bypassed by institutions like the IMF and World Bank.
Bank preparations will likely be finalized at the 6th annual BRICS summit on July 14-16, when the five world leaders convene in Brazil.
Bulgaria: South Stream doesn’t breach EU laws
RT | June 26, 2014
Bulgarian officials say the construction of the Russian-led South Stream gas pipeline does not breach EU legislation. The European Commission is concerned the agreement between Russia and Bulgaria violates EU competition law.
The Bulgarian government stood by its position on the legality of the pipeline in a Wednesday statement, ITAR-TASS reports. The agreement on South Stream construction signed in 2008 did not provide any exclusive rights, concessions, or tendering for the South Stream Bulgaria Company which is the owner of the pipeline, and therefore it does not violate EU law, it said.
“With its position the government presents arguments and motives in support of the decisions the Bulgarian nation has taken and which were the subject of concern at the EU Commission,” Reuters quotes the official statement.
Bulgaria will put these arguments at the Brussels summit on Friday, but the decision of the commission whether to accept or reject them may end up in full infringement proceedings and possible fines against Sofia, Reuters says.
According to Gunther Oettinger, the European Commissioner for Energy, the construction process should be suspended until, “it completely corresponds to the requirements of the European Union.”
On Tuesday Austria, another strong defender of the pipeline, signed a deal to construct a South Stream arm on its territory, thus showing its firm commitment.
The 2,446 km South Stream pipeline will stretch across southern and central Europe via the Black Sea, bypassing Ukraine and reducing the country’s importance as a gas transit route. 64 billion cubic meters of gas will be transported annually.
Gazprom has said the project, estimated to cost $45 billion, can be completed without any funding from international partners.
EU sanctions on Crimea lead to deadlock – Republic’s head
RT | June 24, 2014
SergeyAksyonov, Acting Head of the Republic of Crimea and Chairman of the Crimea Council of Ministers (RIA Novosti / Andrey Iglov)
The head of the Crimean government has stressed rejoining Russia is irreversible. Sergey Aksyonov said an EU ban on imports from Crimea and Sevastopol deprives Europe of a market and it must “realise that the regime of pressure leads to nothing good.”
Aksyonov characterized the EU sanctions targeting the new Russian territory as “a deadlock situation, including for the European Union. They [EU states] deprive themselves of markets to sell their products and of the opportunity to participate in the investment program of Crimea”.
The peninsula head suggests the EU decision to prohibit imports from Crimea was influenced by the US government.
”General agitation over Crimea’s accession to Russia has calmed down in the EU. As far as I understand in this case the US authorities have pushed this stance,” he said.
The EU Commission imposed a ban on imported goods from Crimea following its position of not recognizing Crimea’s accession to Russia.
However Crimean officials say EU sanctions won’t have any serious impact on the region’s economy.
“I do not envisage any major crisis. I do not even know which economic sector might be affected by it. Most of our exports were to Russia; now this is no longer export but domestic operations,” said Vitaly Nakhlupin, the head of the Crimean State Council’s Economic Commission.
Austria and Russia sign South Stream gas pipeline treaty
RT | June 24, 2014
Russia and Austria have agreed on a joint company to construct the Austrian arm of the $45 billion South Stream gas pipeline project, which is expected to deliver 32 billion cubic meters of Russian gas to the country, bypassing Ukraine.
At Tuesday’s meeting in Vienna, the creation of South Stream Austria was announced. The company will be 50 percent owned by Gazprom, Russia’s largest gas producer, and 50 percent by Austria’s OMV Group, the country’s largest oil and gas company.
Construction on the Austrian section is expected to begin in 2015 and that the first deliveries will start in 2017, reaching full capacity in January 2018.
OMV spokesman Robert Lechner was more optimistic, and said the first South Stream deliveries could come as early as 2016.
In April, Gazprom and the OMV Group signed a memorandum to implement the South Stream project in Austria.
At Tuesday’s meeting in Vienna, OMV CEO Gerhard Roiss said that South Stream fully complies with EU legislation.
“This project- investment in European energy security- will fully comply with EU legislation,” Roiss said, as quoted by ITAR-ITASS.
There has been controversy over South Stream, as is it needs EU approval so that it doesn’t violate Europe’s ‘Third Energy Package’, which says a company cannot both own and operate pipelines within the European Union.
Bulgaria and Serbia, countries nearly 100 percent dependent on Russian gas, have faced pressure from the EU to halt construction.
Ahead of Putin’s visit to Vienna, Austrian ministers said they remained committed to Russia’s South Stream project and that they plan to speed it up.

The geopolitical conflict in Ukraine has also complicated the South Stream project, as EU energy lobbying groups are campaigning against the project, to lessen Europe’s dependence on Russia.
“So far [Austria, Ed,] takes a very clear position, avoiding pressure from the European Commission and in general, public opinion in Europe that wants to halt or even stop the project. At the same time it [Austria, Ed] has enough political clout to promote this project. It’s not Bulgaria, which on its own cannot defend itself,” Fyodor Lukyanov, Chairman of Russia’s Council on Foreign and Defense Policy, said on Monday.
South Stream will deliver gas to Europe bypassing Ukraine, which is seen as an unreliable transit state.
After switching Ukraine to a prepayment system, Russia and Gazprom fear Ukraine will start to siphon gas supplies headed towards Europe, as the country did in 2006 and 2009. Miller worries Ukraine may resort to this tactic in winter, once it runs out of its underground storage supplies of natural gas.
“If Ukraine begins to siphon off gas, we will increase supplies via North Stream, and maximize the load through Yamal-Europe,” Aleksey Miller, CEO of Gazprom, said Tuesday in Vienna.
The 2,446 km pipeline will stretch across southern and central Europe and will transport over 64 billion cubic meters of natural gas to Europe per year.
Gazprom has said the project, estimated to cost $45 billion, can be completed without any funding from international partners.
Gazprom is Russia’s largest producer of natural gas and provides roughly one third of Europe’s gas needs.
The head of the Russian Duma’s International Affairs Committee, Aleksey Puskhov, wrote on Twitter on Tuesday that “Ukraine is in a long-term phase of unpredictability. Thus, South Stream is the only guarantee of uninterrupted gas supply to Europe.”
BNP Paribas near record $9bn settlement for violating US sanctions
RT | June 23, 2014
France’s biggest bank has reportedly agreed an $8-9 billion settlement with US prosecutors over hiding $30 billion in money transfers to countries on the US sanctions blacklist. The fine against BNP Paribas could be a record for this type of violation.
In the proposed settlement, BNP Paribas will plead guilty to criminal charges in early July, The Wall Street Journal reports, citing a source close to the matter. After admitting violating the International Economic Powers Act, the bank will temporarily be banned from doing deals in US dollars. France has warned this could have a negative effect on the stability of the euro zone.
The US Department of Justice is negotiating with BNP Paribas over the infractions, and the penalty could be the biggest of its kind. French President Francois Hollande said the fines are ‘unfair’ and ‘disproportionate’.
In 2012, the US fined HSBC $1.9 billion over similar US sanctions violations, and Credit Suisse pled guilty to concealing sanctions data and paid $2.6 billion in fines.
After examining over $100 billion of transactions, US authorities found that $30 billion were illegally conducted with Iran, Cuba, and Sudan as they are countries sanctioned by the US.
The infraction will force the company to reshuffle its US-based management, according to several sources. The Wall Street Journal reports 30 bank employees have already left, or will soon exit, the company.
First set at $3 billion, the penalty later was rumored to have reached $16 billion before the latest $8-9 billion figure. The largest fine on record for a bank is the $13 billion JPMorgan Chase & Co paid out for pre-crisis mortgage frauds. BNP Paribas has only set aside over $1 billion to pay out any potential fines, and a fine between $8-9 billion could nearly wipe out the company’s entire pre-tax earnings of $11.2 billion.
L-3 and Garret supplying equipment for Gaza checkpoint
By Tom Anderson and Therezia Cooper | Corporate Watch | June 20, 2014
The Beit Hanoun (Erez) crossing is the only crossing for people who want to go directly from Gaza into the 1948 borders of Israel. People wishing to cross must apply for a permit and only a small number of permits are granted. Privileged people such as foreign journalists (who are not overly critical of Israel), NGO workers, business people and politicians are often granted permits. Other people have to go through the Rafah crossing from southern Gaza into Egypt.
The Beit Hanoun crossing is subject to frequent closures by the Israeli authorities. The terminal has been closed since the kidnapping of three Israeli teenagers in the West Bank on 12 June. This closure amounts to an act of collective punishment against everyone in Gaza by the Israeli state.
The crossing is also the only way for hundreds of sick patients to obtain treatment. Israeli military attacks have destroyed vital services in Gaza, while the Israeli siege has prevented life saving equipment from reaching services in the Strip. See Corporate Watch’s recent briefing, Besieging health services in Gaza: a profitable business, to find out more about the effects of the siege on health in Gaza.
Corporate Watch did not apply for permission to cross through the Beit Hanoun crossing as we didn’t think that it would be granted. However, we did ask an NGO worker who was crossing to take a look at the equipment used in the terminal. The NGO worker, who wished to remain anonymous told us: “Coming from Israel, you first go through a private Israeli security firm check where your permit number is confirmed so that you can enter the terminal, then in the terminal you go through another Israeli security ‘border patrol’ check. Once through that you go on a long walk to the Palestinian Authority checkpoint where you’re registered, then you get into a taxi and drive just a minute to the Hamas checkpoint where another permit by the local government is checked. That’s the process for getting into Gaza.”
He told us “I saw the machine’s makes: ProVision on the full body scans, Garret on the metal detectors.”
Garrett are a security equipment supplier. In 2013 Corporate Watch reported that Garrett scanning equipment was being used by the police in the occupied West Bank. Garrett equipment is used by HM Court ‘Service’ in the UK. In our view, BDS campaigners should pressure HMCS to end its contract with Garrett because of its supply of security equipment used to enforce the unlawful siege of Gaza.
The PROVision scanners are manufactured by L-3. L-3 is a provider of military and security products and services. According to Who Profits it supplied body scanners to the Beit Hanoun terminal via Hashmira Israel, a security company owned by British-Danish company G4S.


