Merkel not ready to back economic sanctions against Russia
RT | March 27, 2014
The West has not yet reached a stage where it will be ready to impose economic sanctions on Russia, German Chancellor Angela Merkel said, stressing that she hopes for a political solution to the stalemate over Ukraine crisis.
The chancellor said she is “not interested in escalation” of tensions with Russia, speaking after Wednesday meeting with the South Korean president in Berlin.
“On the contrary, I am working on de-escalation of the situation,” she added, as cited by Itar-Tass.
Merkel believes that the West “has not reached a stage that implies the imposition of economic sanctions” against Russia, advocated by US President Barack Obama. “And I hope we will be able to avoid it,” she said.
Berlin is very much dependent on economic ties with Russia with bilateral trade volume equaling to some 76 billion euros in 2013. Further around 6,000 German firms and over 300,000 jobs are dependent on Russian partners with the overall investment volume of 20 billion euros.
Germany is currently the European Union’s biggest exporter to Russia. German car manufacturing companies are likely to suffer first if sanctions against Russia become more substantial, as about half of German exports to Russia are vehicles and machinery.
Volkswagen, BMW, and lorry maker MAN all have Russian operations, with VW willing to inject another €1.8 billion in its Eastern European segment by 2018, the Local reports. Opel, a German car maker which sold over 80,000 cars in Russia in 2013, last week said that the company was “already feeling the stresses and strains from the changing course of the ruble,” Karl-Thomas Neumann, boss of car makers Opel, told Automobilwoche magazine.
On the retail side, German Metro stores wanted to take its Russian subsidiary public this year, but the plan is now imperiled, Der Spiegel reported.
Earlier this month Germany’s KfW development bank canceled a contract with Russia’s VEB bank worth €900 million in investment initiatives for mid-sized companies. Under the deal Germans were to have invested €200 million in Russia.
In addition, Germany is heavily dependent on Russian energy with around 35 percent of its natural gas imports coming from Russia.
Russian Finance Minister Anton Siluanov commented on Russia’s economic situation on Wednesday.
“At present, the investors’ worries are connected with the consequences of sanctions. We see ratings agencies lower the outlook on Russia’s ratings. It certainly puts us on alert. There are no basic grounds for changing the general stability of Russia’s economy,” Siluanov told Russia-24 TV channel.
Standard & Poor’s (S&P) global credit rating agency changed the outlooks for Russia’s large energy companies on Wednesday. Gazprom, Rosneft, Transneft and Lukoil ratings were reduced from stable to negative outlook for having “very strong links” with the Kremlin. Last week S&P and Fitch Ratings lowered Russia’s overall creditworthiness. Both companies affirmed Russia at BBB.
Yet Siluanov defended Russia’s economy and trustworthiness saying that foreign investors hope that the any sanctions against Moscow are temporary.
“The measures that were taken regarding certain persons and companies have their effect. The general mood around Russia has become nervous. But we have good conditions for business,” he said, adding that “neither Western companies nor Russia need the sanctions.”
Slavery, Cotton and Imperialism
By W.T. Whitney, Jr. | CounterPunch | March 25, 2014
“Cuba is already ours. I feel it in my finger’s ends.”
– James Buchanan, 1849
Historian Walter Johnson’s highly recommended book, “River of Dark Dreams,” centers on cotton production and slave ownership in the Mississippi River Valley prior to the U.S. Civil War. Planters, it seems, believed their fate was linked to imperatives imposed through an internationalized system of sales, manufacture, and re-supply. Johnson’s spirited, enthralling narrative casts slave ownership and cotton growing as precarious undertakings. Planters on the edge of disaster strategized and improvised in order to retain both land and slaves.
Their intransigence vis-à-vis northern compatriots derived, Johnson suggests, from immersion in a labyrinth-like alternative universe that set conditions for their economic survival. Planters were alienated enough from pretensions of their own government to seek deliverance through privatized military interventions in countries seen as hospitable to plantations and slavery.
Johnson focuses on actualities and people’s lives rather than on well-trodden slavery-era themes like abolitionism, or northern industrialization, or states rights . Social and economic history in his hands tells of ledger books; cotton “pickability;” slaves starving, stolen, rebelling, and running away; search dogs; slave babies dying, slave prices, soil fertility, droughts, sandbars, and Haiti. Steamboats feature prominently, along with their explosions, gamblers, races, high-pressure engines, and dining room etiquette. They were technological marvels of their era and absolutely crucial for marketing cotton.
During the period under study, Valley cotton production increased fortyfold, the slave population, 17 times. “The greatest economic boom in the history of the United States” was in progress. Cotton was “the largest single sector of the global economy.” Planters were part of “a network of material connections that stretched from Mississippi and Louisiana to 
Manhattan and Lowell to Manchester and Liverpool.” Indeed, the “rate of exploitation of slaves in a field in Mississippi … was keyed to the exchange in Liverpool (port of entry for 85 percent of U.S. planters’ cotton) and the labor of mill hands in Manchester.”
In New York southern cotton was re-sold, re-graded, and re-loaded onto other ships for the Atlantic crossing. That city consumed 40 percent of all income generated through cotton sales. Cotton made up two thirds of all U.S. exports. Yet only 10 percent of U.S. imports ended up in cotton-producing states. Southern manufacturers lacked essential equipment manufactured abroad. Cotton producers endured shortages of imported plantations supplies.
Johnson characterizes “the conceptual reach of the global economy in the first half of the nineteenth century” as “lashes into labor into bales into dollars into pounds sterling.” Cotton moved from plantations, to factors in New Orleans, to bankers and shippers in New York, to bankers, buyers, and manufacturers in England, all on a flood of promissory notes, loans, credit, and deductions.
Planters’ wealth took the form of slaves and land. Although land served as collateral for loans, “without slaves, land itself was worthless.” In effect, planters “buy Negroes to plant cotton and raise cotton to buy Negroes.” Facing hard times, slaveholders as a class could not simply transfer their investment from one form of capital to another… Their capital would not simply rust or lie fallow. It would starve. It would steal. It would revolt.”
Influential trade representatives and publicists determined upon a “spatial fix.” They envisioned the Mississippi River as conduit to southern venues favorable to cotton production and other investment possibilities. “In order to survive, slaveholders had to expand,” the author points out: “Proslavery globalism increasingly took the form of imperialist military action.”
“[F]or many in the Mississippi Valley … the most important issue in the early 1850s was Cuba.” Pursing annexation, former Spanish soldier Narciso López in 1851 invaded the island with troops drawn from “the margins of the cotton economy.” Slaveholders had donated supplies. The expedition failed, and López’ execution in Havana attracted 20,000 spectators. Former Mississippi governor and co-conspirator John Quitman raised 1000 men in 1855 for another invasion, which never materialized.
Johnson reviews the career also of slaveholder proxy William Walker whose small army in 1855 subdued Nicaraguan defenders and set him up as the country’s president. Mississippi Valley supporters provided supplies, arms, troops, and ample publicity.
Were slave-owners capitalist? Johnson rejects the notion of slavery as an “archaic” pre-capitalist mode of exploitation. He settles on “a materialist and historical analysis [that] begins from the premise that there was no nineteenth century capitalism without slavery.” […]
Johnson documents early stirrings of U.S. imperialism. The take among many leftists is that capitalism by its very nature entails recurring crises in accumulation. They assume too that for solutions capitalists look to overseas extension of their operations, even to war making. Thus slave owner longings for exploitative possibilities in the Caribbean and in Central America fueled military adventurism. “River of Dark Dreams” serves in this regard to have documented the beginnings of a U.S. turn toward a global fix for close-to-home economic incongruities. – Full review
W.T. Whitney Jr. is a retired pediatrician and political journalist living in Maine.
How “Extreme Levels” of Roundup in Food Became the Industry Norm
By Thomas Bøhn and Marek Cuhra | Independent Science News | March 24, 2014
Food and feed quality are crucial to human and animal health. Quality can be defined as sufficiency of appropriate minerals, vitamins and fats, etc. but it also includes the absence of toxins, whether man-made or from other sources. Surprisingly, almost no data exist in the scientific literature on herbicide residues in herbicide tolerant genetically modified (GM) plants, even after nearly 20 years on the market.
In research recently published by our laboratory (Bøhn et al. 2014) we collected soybean samples grown under three typical agricultural conditions: organic, GM, and conventional (but non-GM). The GM soybeans were resistant to the herbicide Roundup, whose active ingredient is glyphosate.
We tested these samples for nutrients and other compounds as well as relevant pesticides, including glyphosate and its principal breakdown product, Aminomethylphosponic acid (AMPA). All of the individual samples of GM-soy contained residues of both glyphosate and AMPA, on average 9.0 mg/kg. This amount is greater than is typical for many vitamins. In contrast, no sample from the conventional or the organic soybeans showed residues of these chemicals (Fig. 1).
This demonstrates that Roundup Ready GM-soybeans sprayed during the growing season take up and accumulate glyphosate and AMPA. Further, what has been considered a working hypothesis for herbicide tolerant crops, i.e. that, as resistant weeds have spread:
“there is a theoretical possibility that also the level of residues of the herbicide and its metabolites may have increased” (Kleter et al. 2011) is now shown to be actually happening.
Monsanto (manufacturer of glyphosate) has claimed that residues of glyphosate in GM soy are lower than in conventional soybeans, where glyphosate residues have been measured up to 16-17 mg/kg (Monsanto 1999). These residues, found in non-GM plants, likely must have been due to the practice of spraying before harvest (for desiccation). Another claim of Monsanto’s has been that residue levels of up to 5.6 mg/kg in GM-soy represent “… extreme levels, and far higher than those typically found” (Monsanto 1999).
Figure 1. Residues of glyphosate and AMPA in individual soybean samples (n=31).
For organic and conventional soybeans, glyphosate residues were below the detection limit.
Seven out of the 10 GM-soy samples we tested, however, surpassed this “extreme level” (of glyphosate + AMPA), indicating a trend towards higher residue levels. The increasing use of glyphosate on US Roundup Ready soybeans has been documented (Benbrook 2012). The explanation for this increase is the appearance of glyphosate-tolerant weeds (Shaner et al. 2012) to which farmers are responding with increased doses and more applications.
Maximum residue levels (MRLs) of glyphosate in food and feed
Globally, glyphosate-tolerant GM soy is the number one GM crop plant and glyphosate is the most widely used herbicide, with a global production of 620 000 tons in 2008 (Pollak 2011). The world soybean production in 2011 was 251.5 million metric tons, with the United States (33%), Brazil (29%), Argentina (19%), China (5%) and India (4%) as the main producing countries (American Soybean Association 2013).
In 2011-2012, soybeans were planted on about 30 million hectares in the USA, with Roundup Ready GM soy contributing 93-94 % of the production (USDA 2013). Globally, Roundup Ready GM soybeans contributed to 75 % of the production in 2011 (James 2012).
The legally acceptable level of glyphosate contamination in food and feed, i.e. the maximum residue level (MRL) has been increased by authorities in countries where Roundup-Ready GM crops are produced, or where such commodities are imported. In Brazil, the MRL in soybean was increased from 0.2 mg/kg to 10 mg/kg in 2004: a 50-fold increase, but only for GM-soy. The MRL for glyphosate in soybeans has been increased also in the US and Europe. In Europe, it was raised from 0.1 mg/kg to 20 mg/kg (a 200-fold increase) in 1999, and the same MRL of 20 mg/kg was adopted by the US. In all of these cases, MRL values appear to have been adjusted, not based on new scientific evidence, but pragmatically in response to actual observed increases in the content of residues in glyphosate-tolerant GM soybeans.
Has the toxicity of Roundup been greatly underestimated?
When regulatory agencies assess pesticides for safety they invariably test only the claimed active ingredient.
Nevertheless, these do not necessarily represent realistic conditions since in practice it is the full, formulated herbicide (there are many Roundup formulations) that is used in the field. Thus, it is relevant to consider, not only the active ingredient, in this case glyphosate and its breakdown product AMPA, but also the other compounds present in the herbicide formulation since these enhance toxicity. For example, formulations of glyphosate commonly contain adjuvants and surfactants to stabilize and facilitate penetration into the plant tissue. Polyoxyethylene amine (POEA) and polyethoxylated tallowamine (POE-15) are common ingredients in Roundup formulations and have been shown to contribute significantly to toxicity (Moore et al. 2012).
Our own recent study in the model organism Daphnia magna demonstrated that chronic exposure to glyphosate and a commercial formulation of Roundup resulted in negative effects on several life-history traits, in particular reproductive aberrations like reduced fecundity and increased abortion rate, at environmental concentrations of 0.45-1.35 mg/liter (active ingredient), i.e. below accepted environmental tolerance limits set in the US (0.7 mg/liter) (Cuhra et al. 2013). A reduced body size of juveniles was even observed at an exposure to Roundup at 0.05 mg/liter.
This is in sharp contrast to world-wide regulatory assumptions in general, which we have found to be strongly influenced by early industry studies and in the case of aquatic ecotoxicity assessment, to be based on 1978 and 1981 studies presented by Monsanto claiming that glyphosate is virtually non-toxic in D. magna (McAllister & Forbis, 1978; Forbis & Boudreau, 1981).
Thus a worrisome outlook for health and the environment can be found in the combination of i) the vast increase in use of glyphosate-based herbicides, in particular due to glyphosate-tolerant GM plants, and ii) new findings of higher toxicity of both glyphosate as an active ingredient (Cuhra et al., 2013) and increased toxicity due to contributions from chemical adjuvants in commercial formulations (Annett et al. 2014).
A similar situation can be found for other pesticides. Mesnage et al. (2014) found that 8 out of 9 tested pesticides were more toxic than their declared active principles.
This means that the Accepted Daily Intake (ADI) for humans, i.e. what society finds “admissible” regarding pesticide residues may have been set too high, even before potential combinatorial effects of different chemical exposures are taken into account.
For glyphosate formulations (Roundup), realistic exposure scenarios in the aquatic environment may harm non-target biodiversity from microorganisms, invertebrates, amphibians and fish, (reviewed in Annett et al. 2014) indicating that the environmental consequences of these agrochemicals need to be re-assessed.
Other compositional differences between GM, non-GM, and organic
Figure 2. Discriminant analysis for GM, conventional and organic soy samples based on 35 variables. Data was standardized (mean = 0 and SD = 1).
Our research also demonstrated that different agricultural practices lead to markedly different end products. Data on other measured compositional characteristics could be used to discriminate statistically all individual soy samples (without exception) into their respective agricultural practice background (Fig. 2).
Organic soybeans showed the healthiest nutritional profile with more glucose, fructose, sucrose and maltose, significantly more total protein, zinc and less fiber, compared with both conventional and GM-soy. Organic soybeans contained less total saturated fat and total omega-6 fatty acids than both conventional and GM-soy.
Conclusion
Roundup Ready GM-soy accumulates residues of glyphosate and AMPA, and also differs markedly in nutritional composition compared to soybeans from other agricultural practices. Organic soybean samples also showed a more healthy nutritional profile (e.g. higher in protein and lower in saturated fatty acids) than both industrial conventional and GM soybeans.
Lack of data on pesticide residues in major crop plants is a serious gap of knowledge with potential consequences for human and animal health. How is the public to trust a risk assessment system that has overlooked the most obvious risk factor for herbicide tolerant GM crops, i.e. high residue levels of herbicides, for nearly 20 years? If it has been due to lack of understanding, it would be bad. If it is the result of the producer’s power to influence the risk assessment system, it would be worse.
References
American Soy Association, Soystats. 2013. 16-5-2013.
Annett, R., Habibi, H. R. and Hontela, A. 2014. Impact of glyphosate and glyphosate-based herbicides on the freshwater environment. – Journal of Applied Toxicology DOI 10.1002/jat.2997.
Aumaitre, L. A. 2002. New feeds from genetically modified plants: substantial equivalence, nutritional equivalence and safety for animals and animal products. – Productions Animales 15: 97-108.
Benbrook, C. M. 2012. Impacts of genetically engineered crops on pesticide use in the U.S. – the first sixteen years. – Environmental Science Europe 24:24.
Binimelis, R., Pengue, W. and Monterroso, I. 2009. “Transgenic treadmill”: Responses to the emergence and spread of glyphosate-resistant johnsongrass in Argentina. – Geoforum 40: 623-633.
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.
Cuhra, M., Traavik, T. and Bøhn, T. 2013. Clone- and age-dependent toxicity of a glyphosate commercial formulation and its active ingredient in Daphnia magna. – Ecotoxicology 22: 251-262 (open access). DOI 10.1007/s10646-012-1021-1.
Duke, S. O., Rimando, A. M., Pace, P. F., Reddy, K. N. and Smeda, R. J. 2003. Isoflavone, glyphosate, and aminomethylphosphonic acid levels in seeds of glyphosate-treated, glyphosate-resistant soybean. – Journal of Agricultural and Food Chemistry 51: 340-344.
EC . Review report for the active substance glyphosate. 6511/VI/99-final, 1-56. 2002. European Commission. Health and Consumer Protection Directorate-General.
Forbis, A.D., Boudreau, P. 1981. Acute toxicity of MON0139 (Lot LURT 12011)(AB-81-074) To Daphnia magna: Static acute bio- assay report no. 27203. Unpublished study document from US EPA library
Harrigan, G. G., Ridley, G., Riordan, S. G., Nemeth, M. A., Sorbet, R., Trujillo, W. A., Breeze, M. L. and Schneider, R. W. 2007. Chemical composition of glyphosate-tolerant soybean 40–3-2 grown in Europe remains equivalent with that of conventional soybean (Glycine max L.). – Journal of Agricultural and Food Chemistry 55: 6160-6168.
James, C. Global Status of Commercialized Biotech/GM Crops: 2012. ISAAA Brief No. 44. 2012. ISAAA: Ithaca, NY.
Kleter, G. A., Unsworth, J. B. and Harris, C. A. 2011. The impact of altered herbicide residues in transgenic herbicide-resistant crops on standard setting for herbicide residues. – Pest Management Science 67: 1193-1210.
McAllister, W., Forbis A. 1978. Acute toxicity of technical glyphosate (AB–78–201) to Daphnia magna. Study reviewed and approved 8–30–85 by EEB/HED
Mesnage, R., Defarge, N., Vendômois, J. S. and Seralini, G. E. 2014. Major pesticides are more toxic to human cells than their declared active principles. – BioMed Research International http://dx.doi.org/10.1155/2014/179691.
Monsanto . Residues in Roundup Ready soya lower than conventional soy. http://www.monsanto.co.uk/news/99/june99/220699_residue.html . 1999.
Moore, L. J., Fuentes, L., Rodgers, J. H., Bowerman, W. W., Yarrow, G. K., Chao, W. Y. and Bridges, W. C. 2012. Relative toxicity of the components of the original formulation of Roundup (R) to five North American anurans. – Ecotoxicology and Environmental Safety 78: 128-133.
Pollak, P. 2011. Fine chemicals: the industry and the business. – Wiley.
Shaner, D. L., Lindenmeyer, R. B. and Ostlie, M. H. 2012. What have the mechanisms of resistance to glyphosate taught us? – Pest Management Science 68: 3-9.
USDA . National Agricultural Statistics Service. 2013. 16-5-2013.
The Authors:
Thomas Bøhn
GenØk – Centre for Biosafety, Tromsø, Norway
Professor of Gene Ecology, Faculty of Health Sciences, UiT The Arctic University of Norway
Marek Cuhra
GenØk – Centre for Biosafety, Tromsø, Norway
PhD student, Faculty of Health Sciences, UiT The Arctic University of Norway
BRICS rejects sanctions against Russia over Ukraine
Press TV – March 25, 2014
The group of five major emerging national economies known as the BRICS has rejected the Western sanctions against Russia and the “hostile language” being directed at the country over the crisis in Ukraine.
“The escalation of hostile language, sanctions and counter-sanctions, and force does not contribute to a sustainable and peaceful solution, according to international law, including the principles and purposes of the United Nations Charter,” foreign ministers of the BRICS countries – Brazil, Russia, India, China and South Africa – said in a statement issued on Monday.
The group agreed that the challenges that exist within the regions of the BRICS countries must be addressed within the framework of the United Nations.
“BRICS countries agreed that the challenges that exist within the regions of the BRICS countries must be addressed within the fold of the United Nations in a calm and level-headed manner,” the statement added.
The White House said earlier on Monday that US President Barack Obama and the leaders of Britain, Canada, France, Germany, Italy and Japan decided to end Russia’s role in the G8 over the crisis in Ukraine and the status of Crimea.
Meanwhile, the G7 group of top economic powers has snubbed a planned meeting that Russian President Vladimir Putin was due to host in the Black Sea resort city of Sochi in June.
The G7 said they would hold a meeting in Brussels without Russia instead of the wider G8 summit, and threatened tougher sanctions against Russia.
Russia brushed off the Western threat to expel it from the G8 on the same day. The Autonomous Republic of Crimea declared independence from Ukraine on March 17 and formally applied to become part of Russia following a referendum a day earlier, in which nearly 97 percent of the participants voted in favor of the move.
On March 21, Putin signed into law the documents officially making Crimea part of the Russian territory. Putin said the move was carried out based on the international law.
BRICS at Hague slam attempts to isolate Putin
BRICS Post | March 24, 2014
BRICS have slammed recent reports ahead of the G20 meet to isolate Russian President Vladimir Putin or to place any restrictions on his participation at the G-20 summit in Australia later this year.
“The Ministers noted with concern, the recent media statement on the forthcoming G20 Summit to be held in Brisbane in November 2014. The custodianship of the G20 belongs to all Member States equally and no one Member State can unilaterally determine its nature and character,” said a joint BRICS statement on Monday. Australian Foreign Minister Julie Bishop had said earlier that Putin could be barred from attending the G20 Summit in November.
BRICS Foreign Ministers met on the sidelines of the Nuclear Security Summit in the Hague on Monday to review cooperation among the bloc of five after the adoption of the eThekwini Action Plan of 2013.
The Ministers noted that the role of global governments should focus on “finance, security, information and production”.
“The BRICS agenda is not centered around any specific country or related issue and shares a common vision which drives it to also increasingly identify common areas for cooperation to assist with finding global solutions to global challenges,” noted the joint communiqué.
The BRICS meet convened by South African Foreign Minister Maite Nkoana-Mashabane was attended by her counterparts Sergey Lavrov, Salman Khurshid, Wang Yi and Carlos Antonio Paranhos, Under-Secretary General for Political Affairs of the Federative Republic of Brazil.
The BRICS Ministers also discussed cybersecurity and challenges to peace and security, “notably the significant infringements of privacy and related rights in the wake of the cyber threats experienced, for which there is a need to address these implications in respect of national laws as well as in terms of international law”, said the statement.
BRICS would “continue to act as positive catalysts for inclusive change in the transformation process towards a new and more equitable global order” asserted the Ministers.
BRICS have opposed sanctions against the Syrian government and have argued for a negotiated settlement of the Iranian issue. They are also pushing for reforms of global financial institutions like the IMF.
The five nations also agreed that the challenges that exist within the regions of the BRICS countries must be addressed within the fold of the United Nations.
“The escalation of hostile language, sanctions and counter-sanctions, and force does not contribute to a sustainable and peaceful solution, according to international law, including the principles and purposes of the United Nations Charter,” said the statement.
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Mexico’s Oil Belongs to Its Citizens, Not the Global 1%
Thousands of people march in Mexico City in protest of the privatization of Mexico’s oil industry. Photo by flickr user eneas, March 18, 2013.
By Yoshua Okón | Creative Time Reports | March 18, 2014
Mexico City, Mexico – Oil in Mexico is much more than a symbol of national pride. For the past 75 years it has been an enormous source of income for developing Mexico’s infrastructure and improving social welfare. When, on this day in 1938, President Lázaro Cárdenas expropriated U.S.- and U.K.-owned oil companies, he allowed Mexico to achieve relative independence and modest prosperity. The nationalization of oil saved Mexico from becoming a paralyzed, essentially colonized country like Guatemala, which has a major mining industry that is almost entirely foreign-owned.
Petróleos Mexicanos (PEMEX), the state-owned company with exclusive access to Mexico’s oil, is one of the most lucrative companies in the world. In 2012 it declared profits of over 900 billion pesos (or $70 billion), earnings comparable to those of American oil and gas giants like ExxonMobil and Chevron. More importantly, PEMEX has historically distributed its profits among the Mexican population more equitably than any other industry in the country. Sixty percent of Mexico’s spending on social welfare comes from oil income. Among the things this income currently pays for are education, health care and programs to fight extreme poverty. Every Mexican citizen owns PEMEX, and the profits the company generates have made palpable differences in all of our lives.
Lucrative as it is, PEMEX could make and distribute much greater revenues if it were not so corrupt, inefficient and archaic. We have long known of grave problems with the oil industry and union, such as losses in refining and production. (Output has fallen 25 percent since 2004.) If PEMEX isn’t brought up to date in the next few years, there is a serious danger that the company will collapse. But instead of reforming the institution, the current government has exploited PEMEX’s deficiencies under the guise of reform to fiercely promote a very different agenda: the privatization of oil in Mexico.
Far from modernizing PEMEX, eliminating corruption or directing more income to Mexico’s citizens, the so-called energy reform passed by Congress and signed into law by President Enrique Peña Nieto in December will radically shift the distribution of oil profits from the public to a few private investors. The bill modified Mexico’s constitution to allow private oil companies to compete with PEMEX in every aspect of oil production. Underground oil reserves will still belong to Mexico, but since all profits derived from production will go to corporations, these reforms effectively constitute a privatization. Yet the president never admitted to this underlying agenda in the lead-up to the bill’s passage; his administration has altogether avoided using the word “privatization,” in favor of vague references to “modernization” and “the need for private investment.” This lack of honesty has generated tremendous confusion among the Mexican population, greatly debilitating potential opposition to the bill.
As Peña Nieto and his Institutional Revolutionary Party (PRI) prepare a new set of bills that will implement the changes to oil laws, a multimillion-dollar publicity campaign of disinformation initiated last year by his administration still saturates the mass media, diverting the debate on “energy reform” by reducing it to obvious questions: Is reform necessary? Is PEMEX efficient? Do we need progress and modernization? As a result, we have skipped over the most pressing and fundamental questions: What should the nature of this reform be? How will profits be distributed? What measures are in place to fight the corruption that causes us to lose so much of our oil income? In order to modernize, do we have to abandon the idea that Mexican oil belongs to the people of Mexico?
The recent history of PEMEX is a story of deliberate sabotage. PEMEX managers have enabled politicians to keep a portion of the company’s profits for decades, laying the groundwork for privatization by making corruption seem like the natural result of a nationalized industry. But the underlying problem has always been and still is political corruption, not a lack of private investment. Consider Romero Deschamps, the leader of PEMEX’s union since 1989, who is accused of stealing an estimated 3 billion pesos’ worth of the union’s assets and of having illegally created secret “private” companies that undertake contract work for PEMEX. In spite of the abundant proof of his guilt, Deschamps is currently a senator for the ruling PRI. Peña Nieto claims that stamping out such criminality is one of the primary objectives of the current “reform,” but his policy for overhauling the industry doesn’t contain a single strategy aimed at fighting corruption.
The majority of the proposed structural changes to PEMEX aren’t even necessary for the task of modernizing Mexico’s oil industry. PEMEX already has access to cutting-edge technologies since private oil companies can operate in Mexico and have been doing so (for example, PEMEX is currently contracting the services of Halliburton and OHL). Whether or not PEMEX should contract private companies is irrelevant; what matters are the terms on which it partners with the private sector. The fact that the Peña Nieto administration is permitting profit-sharing contracts—which have historically been imposed on poor countries, with disastrous results—rather than limiting partnerships to licensing permits that would pave the way for increased efficiency without signing away the democratic ownership of resources, is another clear indicator of the underlying agendas behind the “energy reform.” As former PEMEX director general Adrián Lajous has argued, profit-sharing contracts render private companies unaccountable, leaving the state, its resources and its people vulnerable.
Peña Nieto presents his “reform” as the magic solution to PEMEX’s problems, as if the neoliberal dream of privatization without regulation were synonymous with social justice, economic well-being and democracy. But the facts paint a very different picture. Since neoliberal policies surged in the 1980s and former president Carlos Salinas de Gortari signed NAFTA into law in 1994, a weakened state, incapable of protecting the environment and the rights of its poorest people, has created the perfect conditions for political and corporate corruption. We live every day with the consequences of Carlos Slim’s acquisition of Telmex, the telecommunications company that Salinas privatized in 1990. Because there is little regulation, prices are high and service is poor, and Slim is now one of the richest men in the world. Another dark legacy of Salinas is his privatization of the banking sector and creation of Fobaproa, an agency intended to prevent banks from going bankrupt. After Mexico’s 1994 economic crisis, the institution of Fobaproa meant that the public paid off banks’ massive debts. High-ranking politicians and businessmen have pocketed extraordinary profits, while everyday people have borne greater economic burdens, with each move to privatize. The result is a spectacular growth in inequality. More than 53 million people in Mexico today—nearly half the country—live in poverty, and 11.5 million Mexicans live in extreme poverty. Meanwhile, the eleven richest men in the country have accumulated roughly 11 percent of the GDP.
We cannot undertake true energy reform in Mexico without first undertaking political reforms that would decisively and effectively tackle corruption. Sadly, because it does nothing to change political structures and curb corruption, the current legislative process is taking us further away from democratic values and constitutes a huge step in the wrong direction. Approved by politicians who never consulted voters, the bill passed in December opens the field for companies that are known the world over for their abusive practices and for co-opting politicians (ExxonMobil, Shell, BP, OHL) to operate in Mexico without regulation or restriction. In the words of the historian Lorenzo Meyer Cossío, we are opening the door to “mercenaries.” The Mexican government expects its citizens to place ownership of our hydrocarbons in private hands, without our agreement and in exchange for minimal revenue. But modernization does not require that we give up our resources. Improvement shouldn’t entail changing the basic principle that natural resources belong to us all.
The “energy reform” currently under way is a huge step toward greater inequality, environmental devastation and the loss of economic and political independence for Mexico. It is one example of the neoliberal fantasy of unregulated capitalism that has landed us in our present situation, in which the 85 richest people in the world hold the same amount of wealth as the 3.5 billion poorest. We are living through the greatest inequality in the history of humanity and unprecedented ecological destruction. To combat this urgent situation, we need to strengthen fragile regulatory structures by creating independent, democratically owned institutions. By instead dismantling the few supportive social structures left, Peña Nieto’s government is pushing Mexico to a dangerous place. Against a backdrop of extreme poverty and social injustice, the PRI’s “reforms” will, sooner or later, lead to revolt.
Translated by Georgia Phillips-Amos.
This piece was made possible, in part, by the Andy Warhol Foundation for the Visual Arts.
Visa, MasterCard Freeze Cards at Sanctioned Russian Banks
RIA Novosti | March 21, 2014
MOSCOW – US-based Visa Inc. and MasterCard Inc. have stopped processing payments by cardholders at Russian banks targeted by the United States for financial sanctions on Thursday, a number of Russian banks said Friday.
The news signaled the first impact on ordinary Russian citizens by a series of Western sanctions against Russia over the ongoing situation in Ukraine, the greatest geopolitical showdown between Russia and the West since the end of the Cold War.
Earlier sanctions had been restricted to targeting high-level officials.
Several banks reported that customer cards were being declined for payment and that they had received no advance notification of the changes. Customer deposits remained unaffected.
Visa confirmed Friday that it had blocked cards issued by four Russian banks for use on its payment network for online or retail purchases.
Visa said the list of the banks facing sanctions announced by the US Treasury on Thursday includes Rossiya Bank, SMP Bank, Sobinbank and Investcapitalbank, the latter two being part of Rossiya Bank.
“The management of Rossiya Bank understands the difficulties experienced by clients in this situation, and assures them that everything possible is being done to help,” Rossiya Bank said in a statement on its website.
The bank added that customers could still withdraw cash from the bank’s ATMs without difficulties, as well as those owned by partner banks.
Sobinbank said that its call centers had been swamped by customers who were abroad and suddenly found their cards were not working.
SMP Bank is majority owned by brothers Arkady and Boris Rotenberg, who were both named on the US sanctions list.
“All other operations, including the issuance of deposits and making payments remain unaffected and without any restrictions,” SMP Bank said in a statement, adding that it has no assets in the United States.
The US and EU announced asset freezes and travel bans targeting a number of Russian officials close to Putin on Monday, following a referendum in Crimea that saw voters overwhelmingly support reunification with Russia after 60 years as part of Ukraine.
Those lists were expanded – including the addition of Rossiya Bank to the US list – following the ratification of the reunification treaty by Russia’s lower house of parliament Thursday.
Russian President Vladimir Putin warned earlier this month that sanctions against Russia threatened to cause mutual damage in the modern, integrated global economy.
Leaders in Crimea refused to recognize the legitimacy of the government in Kiev that came to power amid often violent protests last month, instead seeking reunification with Russia.
Violence and Terror: The Ukrainian and Colombian Road to Empire Building
By James Petras | The People’s Voice | March 19, 2014
Introduction
The two paths to 21st century empire-building-via-proxies are illustrated through the violent seizure of power in the Ukraine by a US-backed junta and the electoral gains of the US-backed Colombian war lord, Alvaro Uribe. We will describe the ‘mechanics’ of US intervention in the domestic politics of these two countries and their profound external effects – that is how they enhance imperial power on a continent-wide basis.
Political Intervention and Proxy Regimes: Ukraine
The conversion of the Ukraine into a US-EU vassal state has been a prolonged process which involved large scale, long term financing, indoctrination and recruitment of cadres, organization and training of politicos and street fighters and, above all, a capacity to combine direct action with electoral politics.
Seizing power is a high stakes game for empire: (1) Ukraine, in the hands of clients, provides a NATO with a military springboard into the heart of the Russian Federation; (2) Ukraine’s industrial and agricultural resources provide a source of enormous wealth for Western investors and (3) Ukraine is a strategic region for penetrating the Caucuses and beyond.
Washington invested over $5 billion dollars in client-building, mostly in ‘Western Ukraine’, especially in and around Kiev, focusing on ‘civil society groups’ and malleable political parties and leaders. By 2004, the initial US political ‘investment’ in regime change culminated in the so-called ‘Orange Revolution’ which installed a short-lived pro-US-EU regime. This, however, quickly degenerated amidst major corruption scandals, mismanagement and oligarchical pillage of the national treasury and public resources leading to the conviction of the former-Vice President and the demise of the regime. New elections produced a new regime, which attempted to secure ties with both the EU and Russia via economic agreements, while retaining many of the odious features (gross endemic corruption) of the previous regime. The US and EU, having lost thru democratic elections, relaunched their ‘direct action organizations’ with a new radical agenda. Neo-fascists seized power and established a dictatorial junta through violent demonstrations, vandalism, armed assaults and mob action. The composition of the new post-coup junta reflected two sides of the US-backed political organizations: (1) neo-liberal politicos for managing economic policy and forging closer ties with NATO, (2) and neo-fascists/violent nationalists to impose order by force and fist, and crush pro-Russian Crimean ‘autonomists’ and ethnic Russians and other minorities, especially in the industrialized south and east.
Whatever else may ensue, the coup and the resultant junta is fully subordinated to and dependent on the will of Washington: claims of Ukrainian ‘independence’ notwithstanding. The junta proceeded to purge the elected and appointed government officials affiliated with the political parties of the previous democratic regime and to persecute its supporters. Their purpose is to ensure that subsequent managed elections will provide a pretense of legitimacy, and elections will be limited to two sets of imperial clients: the neo-liberals, (self-styled “moderates”) and the neo-fascists dubbed as “nationalists”.
Ukraine’s road to imperialist power via a collaborator regime illustrates the various instruments of empire building: (1) the use of imperial state funds, channeled through NGOs, to political front groups and the build-up of a ‘mass base’ in civil society; (2) the financing of mass direct action leading to a coup (‘regime change’); (3) the imposition of neo-liberal policies by the client regime; (4) imperial financing of the re-organization and regroupment of mass direct action groups after the demise of the first client regime; (5) the transition from protest to violent direct action as the major backdrop to the extremist sectors (neo-fascists) organizing the seizure of power and purge of the opposition; (6) organizing an ‘international media campaign’ to prop up the new junta while demonizing domestic and international opposition (Russia) and (7) political power centralized in the hands of the junta, convoking “managed elections” limited to the victory of one or the other pro-imperial pro-junta candidates.
In summary, empire-builders operate on several/levels: violent and electoral; social and political; and with selected incumbents and rivals committed to one strategic aim: the seizure of state power and the conversion of the ruling elite into willing vassals of empire.
Columbia’s Deathsquad Democracy: Centerpiece of the Imperial Advance in Latin America
In the face of a continent-wide decline of US influence in Latin America, Colombia stands out as a constant bulwark of US imperial interests: (1) Colombia signed a free trade agreement with the US; (2) provided seven military bases and invited thousands of US counter-insurgency operatives; and (3) collaborated in building large-scale paramilitary death squads prepared for cross border raids against Washington’s arch enemy Venezuela.
Colombia’s ruling oligarchy and military have been able to resist the wave of massive democratic, national and popular social upheavals and electoral victories that gave rise to the post-neo-liberal states in Brazil, Argentina, Venezuela, Ecuador, Bolivia, Paraguay and Uruguay.
While Latin America has moved toward ‘regional organizations’ excluding the US, Colombia strengthened its ties to the US through bilateral agreements. While Latin America reduced its dependence on US markets, Colombia expanded its commercial ties. While Latin America reduced their military ties to the Pentagon, Colombia tightened them. While Latin America moved toward greater social inclusion by increasing taxes on foreign multinational corporations, Colombia lowered corporate taxes. While Latin America expanded land settlements for its landless rural populations, Colombia displaced over 4 million peasants as part of the US-designed ‘scorched earth’ counter-insurgency policy.
Colombia’s “exceptional” unwavering submission to US imperial interests is rooted in several large-scale, long-term programs developed in Washington. In 2000, President ‘Bill’ Clinton committed the US to a $6 billion dollar counter-insurgency program (Plan Colombia) which greatly increased the brutal repressive capacity of the Colombian elite to confront the popular grass roots movements of peasants and workers. Along with arms and training, US Special Forces and ideologues entered Colombia to develop military and paramilitary terror operations – aimed primarily at penetrating and decimating political opposition and civil society social movements and assassinating activists and leaders. The US-backed Alvaro Uribe, notorious narco-trafficker and the very personification of a ruthless imperial vassal, became president over a ‘Death-Squad Democracy’.
President Uribe further militarized Colombian society, savaged civil society movements and crushed any possibility of a popular democratic revival, such as were occurring throughout the rest of Latin America. Thousands of activists, trade unionists, human rights workers and peasants were murdered, tortured and jailed.
The ‘Colombian System’ combined the systematic use of para-militarism (death squads) to smash local and regional trade union and peasant opposition and the technification and massification of the military (over 300,000 soldiers) in fighting the popular insurgency and ‘emptying the countryside’ of rebel sympathizers. Large-scale multi-billion dollar drug trafficking and money laundering formed the ‘financial glue’ to cement a tight relationship among oligarchs, politicos, bankers and US counter-insurgency advisers – creating a terrifying high-tech police state bordering Venezuela, Ecuador and Brazil – countries with substantial popular mass movements.
The same state terror machinery, which decimated the pro-democracy social movements, has protected, promoted and participated in ‘stage-managed elections’, the hallmark of Colombia as a “death squad democracy”.
Elections are held under a vast overlapping network of military bases, where death squads and drug traffickers occupied towns and villages intimidating, terrorizing and ‘corrupting’ the electorate. The only ‘safe’ protest in this repressive atmosphere has been voter abstention. Electoral outcomes are pre-ordained: oligarchs never lose in death squad democracies, they are the empire’s most trusted vassals.
The cumulative effects of the decade and a half-long bloody purge of Colombian civil society by Presidents Uribe and his successor, Santos, have been to eliminate any consequential electoral opposition. Washington has achieved its ideal: a stable vassal state; a large-scale and obedient military; an oligarchy tied to US corporate elites; and a tightly-controlled ‘electoral’ system that never permits the election of a genuine opponent.
The March 2014 Colombian elections brilliantly illustrate the success of US strategic intervention in collaboration with the oligarchy: The vast majority of the electorate, over two-thirds, abstained, demonstrating the absence of any real legitimacy among the eligible voters. Among those who ‘voted’, ten percent submitted ‘spoiled’ or blank ballots. Voter abstention and ballot-spoilage was especially high in the rural regions and working class areas which had been subject to state terror.
Given the intense state repression, the mass of voters decided that no authentic pro-democracy party would have any chance and so refused to legitimize the process. The 30% who actually voted were largely urban middle and upper class Colombians and residents in some rural areas completely controlled by narco-terrorists and the military where ‘voting’ may have been ‘compulsory’. Of a total of 32 million eligible voters in Colombia, 18 million abstained and another 2.3 million submitted spoiled ballots. The two dominant oligarchical coalitions led by President Santos and ex-President Uribe received only 2.2 million and 2.05 million votes respectively, a fraction of the number who abstained (14 million). In this widely scorned electoral farce, the center-left and left parties made a miserable showing. Colombia’s electoral system puts a propaganda veneer on a dangerous, highly-militarized vassal state primed to play a strategic role in US plans to “reconquer” Latin America.
Two decades of systematic terror, financed by a six-billion dollar militarization program, has guaranteed that Washington will not encounter any substantial opposition in the legislature or presidential palace in Bogota. This is the ‘acrid, gunpowder-tinged smell of success’ for US policymakers: violence is the midwife of the vassal state. Colombia has been turned into the springboard for developing a US-centered trade bloc and a military alliance to undermine Venezuela’s Bolivarian regional alliances, such as ALBA and Petro Caribe as well as Venezuela’s national security. Bogota will try to influence neighboring right and center-left regimes pushing them to embrace of the US Empire against Venezuela.
Conclusion
Large-scale, long-term subversion and organization in Ukraine and Colombia, as well as the funding of paramilitary and civil society organizations (NGO) has enabled Washington to: (1) construct strategic allies, (2) build ties to oligarchs, malleable politicians and paramilitary thugs and (3) apply political terrorism for their seizure of state power. The imperial planners have thus created “model states” – devoid of consequential opponents and ‘open’ to sham elections among rival vassal politicians.
Coups and juntas, orchestrated by longstanding political proxies, and highly militarized states run by ‘Death Squad Executives’ are all legitimized by electoral systems designed to expand and strengthen imperial power.
By rendering democratic processes and peaceful popular reforms impossible and by overthrowing independent, democratically elected governments, Washington is making wars and violent upheavals inevitable.
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James Petras is a Bartle Professor (Emeritus) of Sociology at Binghamton University, New York. He is the author of 64 books published in 29 languages, and over 560 articles in professional journals, including the American Sociological Review, British Journal of Sociology, Social Research, Journal of Contemporary Asia, and Journal of Peasant Studies.
Resurgent Chilean Social Movements Advance Cross-Border Solidarity
By Emily Achtenberg | Rebel Currents | March 14, 2014
On March 11, newly elected President Michelle Bachelet began her inaugural speech by acknowledging her debt to the social movements that propelled her center-left New Majority coalition to victory, on a radical platform that has transformed Chile’s political landscape. Even as they continue to shape the domestic political agenda, activist students, trade unionists, and other civil society and political organizations are also mobilizing to build cross-border solidarity, pressuring Bachelet to ally with other leftist governments in the region.
On February 15, the militant University of Chile Student Federation (FECH)—fresh on the heels of forcing the ouster of Bachelet’s newly-appointed education undersecretary and her replacement with a more politically compatible designee—issued a strong statement critical of Venezuelan students who have spearheaded ongoing protests against the Chavista government of Nicolás Maduro. “We don’t feel represented by the actions of Venezuelan student sectors that are defending the old order, in opposition to the path that the people have defined,” the statement read in part.
Demonstrating at the Venezuelan embassy, representatives of FECH and other student federations emphasized that the middle-class Venezuelan students, unlike their Chilean counterparts, are not demanding educational or other social reforms. Rather, student leaders explained, they are mobilizing against the Chavista government which has advanced the goals of free, public education and democratization of the university, the very issues that Chilean students are fighting for.
To be sure, FECH’s stance is opposed by Chile’s Young Christian Democrats (JDC), student organizations from some private universities, and other dissident factions, who have urged support for the protesters. Some groups, such as the Student Federation of Catholic University (FEUC), have called for protection of Venezuelan students’ rights, while stopping short of endorsing their demands.
The split mirrors divisions within the New Majority coalition itself. Under pressure from FECH and allied student organizations, Bachelet has publicly supported Maduro and the people of Venezuela, calling on all sides to seek a peaceful and democratic resolution to the conflict, while leading Christian Democrats accuse the Venezuelan government of criminalizing and repressing dissent. The recent assassination of a 47-year old Chilean citizen in Venezuela, a Chavista supporter and mother of four, has heightened domestic tensions over the issue. Still, the majority of student organizations continue to emphasize (to both Chilean and foreign media) that their movement has little in common with Venezuela’s student protests.
Following Bachelet’s inaugural ceremony, some 5,000 representatives of student, trade union, community, indigenous, and other civil society organizations assembled at the Teatro Caupolicán in Santiago to welcome Bolivian President Evo Morales with the slogan “Mar para Bolivia!” (“The sea for Bolivia!”). The issue of regaining coastal territory lost to Chile in the 1879 War of Pacific, which left Bolivia landlocked, has long been a rallying point for Bolivia and is now a crusade for the Morales government.
Last year, Morales filed a lawsuit with the International Court of Justice in The Hague, demanding that Chile negotiate in good faith to provide Bolivia with sovereign access to the Pacific. Morales argues that the 1904 Peace Treaty signed by the two countries was imposed under duress, and should be scrapped or modified. On economic grounds, Bolivia claims that its landlocked status has reduced its GNP by more than $30 billion since 1970, while the mineral-rich ceded territory (now the site of some of the world’s biggest copper mines) has made Chile the wealthiest country in South America.
The dispute has strained relations between the two countries for decades. Ironically, former dictators Augusto Pinochet and Hugo Banzer were on the brink of an agreement in 1975, which derailed when Pinochet demanded territorial compensation from Bolivia in exchange for granting it a sea corridor. A 13-point bilateral agenda developed by Morales and Bachelet during her first term in 2006 was sidelined by her conservative successor, Sebastián Piñera.
Recent efforts to resume dialogue with Bolivia have been spearheaded by Chilean social sectors and political activists. Last April, 57 civil society groups, including the Workers United Center of Chile (CUT, the major national trade union federation) and indigenous Mapuche organizations, signed a letter demanding that Piñera offer Bolivia a constructive proposal. Former Progressive Party presidential candidate Marco Enríquez-Ominami, who placed third in the first-round election, visited Morales last month to convey Chilean solidarity and pave the way for the post-inaugural encounter.
Former student leader and newly elected Communist Party congressional deputy Camila Vallejo has been a leading voice pressing the Bachelet government to re-engage with Bolivia. “It’s not about giving away a gift,” she emphasizes. “Bolivia has significant energy (gas) resources and we are, supposedly, in an energy crisis. Why not have a politics of integration and mutual solidarity?”
To the consternation of many, Bachelet—bowing to conservative pressures—announced the day after her inauguration that Chile will not negotiate Bolivia’s sea access while the matter is pending before the International Court. For his part, Morales has refused to abandon Bolivia’s legal claims, leaving civil society activists with a significant role to play in the continuing controversy .
Finally, last December more than 50 Chilean civil society leaders, 15 senators, and 37 congressional deputies signed a public declaration demanding a halt to negotiations on the Trans-Pacific Partnership (TPP), a U.S.-led trade initiative involving a dozen Pacific Rim nations. Activists are demanding increased transparency, as well as protections from trade rules that could undermine national sovereignty over intellectual property rights, access to medicine, capital flow management, and other crucial matters. Bachelet, a strong supporter of free trade, is also an advocate of national sovereignty. Her campaign manager (now finance minister) Alberto Arenas has indicated his support for civil society’s position.
As Bachelet struggles to manage competing ideological tensions within her own New Majority coalition, continuing pressure from Chile’s resurgent social movements on these and other cross-border issues will be critical in positioning Chile within Latin America’s growing political divide.
Related article
Despite Obama Statements, Justice Dept. Ranked Mortgage Fraud as Low Priority
By Noel Brinkerhoff | AllGov | March 17, 2014
The U.S. Department of Justice (DOJ) has treated mortgage fraud cases as a low priority, even though President Barack Obama promised to crack down on such crimes in the wake of the 2008 financial crisis.
DOJ also greatly exaggerated its success in prosecuting mortgage fraud, according to an investigation by the department’s Office of the Inspector General (IG).
Attorney General Eric Holder Jr. declared four years ago that mortgage fraud crimes had “reached crisis proportions,” and promised his agency would be “fighting back” in response.
But the IG’s report (pdf) shows the Federal Bureau of Investigation (FBI) put mortgage fraud at the bottom of its criminal priority list—after receiving extra funding ($196 million from the 2009 to 2011) to address this problem. In some major cities, mortgage fraud wasn’t even on the FBI’s radar as any kind of a priority.
“Despite receiving significant additional funding from Congress to pursue mortgage fraud cases, the FBI in adding new staff did not always use these new positions to exclusively investigate mortgage fraud,” the report states.
A “significant backlog of unaddressed and pending mortgage fraud investigations” was disclosed by supervisors interviewed by IG investigators. In fact, important fraud cases were completely shut down by the FBI, not due to a lack of resources, but because the Bureau’s resources were diverted to other operations that were given higher priority, according to the report.
Just as disturbing was the fact that Justice inflated its numbers to make it appear prosecutors were doing more than they actually were.
In 2012, Holder announced his lawyers had charged 530 people during the previous year with mortgage fraud that had cost homeowners more than $1 billion.
In truth, the numbers were more like 107 people charged in cases totaling only $95 million, the IG found. Even after the figures were proven to be incorrect, the DOJ continued to cite the false statistics for nearly a year.
“The inspector general’s report sheds light on what looks like an attempt by the Justice Department to pull the wool over the public’s eyes with respect to its efforts to go after the wrongdoers involved in mortgage fraud,” Senator Charles Grassley (R-Iowa), the ranking member on the Senate Judiciary Committee, said in a statement. “According to the inspector general, the department wasted time cooking the numbers about the cases it pursued, when it should have been prosecuting cases.”
The IG offered numerous recommendations to the department, most of which involved fixes to DOJ’s recordkeeping system that had produced such inaccurate figures.
The Justice Department objected to the IG’s conclusions, citing prosecutors doubling the number of mortgage fraud indictments from 2009 to 2011.
“The facts regarding the department’s work on mortgage fraud tell a much different story than this report,” Ellen Canale, a department spokeswoman, told The New York Times. “As the report itself notes, even at a time of constrained budget resources, the department has dedicated significant manpower and funding to combating mortgage fraud.”
Mortgage fraud—through falsification of documents by lenders and brokers—was one of the catalysts of the 2008 financial collapse. Fraud involving mortgage-backed securities, said to be larger in scope and also a contributing factor to the collapse, is considered by the FBI to be securities fraud and was not addressed by the IG report.
To Learn More:
U.S. Criticized for Lack of Action on Mortgage Fraud (by Matt Apuzzo, New York Times)
Mortgage Fraud Efforts Fell Short, Justice Department Inspector General Concludes (by Jeffrey Benzing, Main Justice)
Audit of the Department of Justice’s Efforts to Address Mortgage Fraud (U.S. Department of Justice, Inspector General) (pdf)
Justice Dept. Sues Bank of America over Prime Mortgage Fraud (by Noel Brinkerhoff, AllGov)
Big Banks Slither out of Mortgage Fraud Review with Minor Costs (by Noel Brinkerhoff, AllGov)
How to rob a bank: William Black
TEDx Talks | March 3, 2014
William Black is an associate professor of economics and law at UMKC. He has held many prestigious positions, including executive director for Fraud Prevention. He recently helped the World Bank develop anti-corruption initiatives and served as an expert for OFHEO in its enforcement action against Fannie Mae’s former senior management. He is a criminologist and former financial regulator.
KPFA interviews:
Guns and Butter | April 4, 2012
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“Formula For Fraud” with William K. Black from the first Italian economic Summit on Modern Money Theory in Rimini, Italy. How to become a billionaire – the four necessary ingredients in the recipe for fraud; the three sure consequences of banking control fraud; gutting of the underwriting process; Gresham’s Law; The Business Roundtable; hyperinflation of a bubble. – link
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Guns and Butter | February 29, 2012
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Play this clip in your Computer’s media player
“The Greatest Bank Robbery Ever” with William K. Black. Banks, intensifying financial crises; money manager capitalism; sovereign currency; crony capitalism; theoclassical economists; control fraud, Commodities Future Modernization Act of 2000; S&L Liars’ Loan Crisis of 1990-91; Reinventing Government Movement; deregulation, desupervision and defacto decriminalization; fraud incentives; looting; subprime; Enron; Parmalat; BofA; Citigroup; Ameriquest; Washington Mutual; systemically dangerous institutions; Financial Accounting Standards Board (FASB); faux stress tests; European austerity crisis; Mario Draghi, President of the ECB. – link
What A Destructive Wall Street Owes Young Americans
By Ralph Nader | March 14, 2014
Wall Street’s big banks and their financial networks that collapsed the U.S. economy in 2008-2009, were saved with huge bailouts by the taxpayers, but these Wall Street Gamblers are still paid huge money and are again creeping toward reckless misbehavior. Their corporate crime wave strip-mined the economy for young workers, threw them on the unemployment rolls and helped make possible a low-wage economy that is draining away their ability to afford basic housing, goods, and services.
Meanwhile, Wall Street is declaring huge bonuses for their executive plutocrats, none of whom have been prosecuted and sent to jail for these systemic devastations of other peoples’ money, the looting of pensions and destruction of jobs.
Just what did they do? Peter Eavis of the New York Times provided a partial summary – “money laundering, market rigging, tax dodging, selling faulty financial products, trampling homeowner rights and rampant risk-taking – these are some of the sins that big banks have committed in recent years.” Mr. Eavis then reported that “regulators are starting to ask: Is there something rotten in bank culture?”
The “rot” had extended long ago to the regulators whose weak laws were worsened by weak enforcement. Veteran observer of corporate criminality, former Texas Secretary of Agriculture and editor of the Hightower Lowdown newsletter, Jim Hightower writes:
“Assume that you ran a business that was found guilty of bribery, forgery, perjury, defrauding homeowners, fleecing investors, swindling consumers, cheating credit card holders, violating U.S. trade laws, and bilking American soldiers. Can you even imagine the punishment you’d get?
How about zero? Nada. Nothing. Zilch. No jail time. Not even a fine. Plus, you get to stay on as boss, you get to keep all the loot you gained from the crime spree, and you even get an $8.5 million pay raise!”
Hightower was referring to Jamie Dimon, the CEO of JPMorgan Chase, “the slick CEO who has fostered a culture of thievery during his years as a top executive at JPMorgan, leading to that shameful litany of crime.”
Shame? Dimon doesn’t know how to spell it. “I am so damn proud of this company. That’s what I think about when I wake up every day” he said in October, 2013.
Millions of young Americans (called Millennials, between ages 18 and 33) should start agitating through demonstrations, demand petitions and put pressure on the bankers and members of Congress. First the plutocrats and their indentured members of Congress should drop their opposition to a transaction tax on Wall Street trading. A fraction of a one percent sales tax on speculation in derivatives and trading in stocks (Businessweek called this “casino capitalism”) could bring in $300 billion a year. That money should go to paying off the student debt which presently exceeds one trillion dollars. Heavy student debt is crushing recent graduates and alarming the housing industry. For example, people currently between the ages of 30 to 34 have a lower percentage of housing ownership than this age group has had in the past half century.
A Wall Street transaction tax was imposed in 1914 and was more than doubled in 1932 to aid recovery from the Great Depression before it was repealed in 1966. But the trading volume then was minuscule compared to now with computer-driven trading velocity. A tiny tax – far less than state sales taxes on necessities – coupled with the current huge volume of trading can free students from this life-misshaping yoke of debt.
Some countries in Europe have a securities transaction tax and they also offer their students tuition-free university education to boot. They don’t tolerate the same level of greed, power and callous indifference to the next generation expressed by the monetized minds of the curled-lipped Wall Street elders that we do.
What about young people who are not students? The Wall Street tax can help them with job-training and placement opportunities, as well as pay for tuition for technical schools to help them grow their skills.
A good many of the thirty million Americans stuck in a wage range lower than the minimum wage in 1968, adjusted for inflation, (between $7.25 and $10.50) are college educated, in their twenties and thirties, and have no health insurance, no paid sick leave and often no full-time jobs.
A youth movement with a laser-beam focus, using traditional forms of demonstration and connecting in person, plus social media must come down on Wall Street with this specific demand. Unfortunately, while Occupy Wall Street started an important discussion about inequality, they did not advance the transaction tax (backed vigorously by the California Nurses Association), when they were encamped near Wall Street and in the eye of the mass media in 2011. A missed opportunity, but not a lost opportunity. Fighting injustice has many chances to recover and roar back.
It is time for, young Americans to act! Push Congress to enact a Wall Street speculation tax to help roll back your student debt and give you additional opportunities that are currently denied to you by the inside bank robbers who never had to face the sheriffs. They owe you.
As William C. Dudley, the eminent president of the Federal Reserve Bank of New York recently said of Wall Street – “I think that they really do have a serious issue with the public.” Yes, penance and future trustworthiness enforced by the rule of law.
nowhere.
Young America, you have nothing to lose but your incessant text messages that go nowhere.
Start empowering yourselves, one by one, and then connect by visiting Robin Hood Tax.
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$1.5bn up in smoke: US THAAD missile stockpile dries up defending Israel against Iran
By Ivan Kesic | Press TV | July 2, 2025
According to American media, defense news outlets, and independent analysts, the 12-day Israeli military aggression against Iran significantly depleted the US stockpile of THAAD (Terminal High Altitude Area Defense) interceptor missiles.
Citing official sources, American magazine Newsweek reported on Friday that the US transferred a substantial portion of its advanced missile defense capabilities to support the Israeli regime, an effort with questionable results and a critical impact on US strategic reserves.
THAAD, developed by Lockheed Martin arms manufacturing company, is a key component of Israel’s multi-layered air defense architecture. It is designed to intercept medium-range ballistic missiles, including those launched from Iran and Yemen.
The US-made system is capable of targeting short-, medium-, and intermediate-range ballistic missiles during their terminal phase, whether inside or outside Earth’s atmosphere.
THAAD uses a “hit-to-kill” method, relying on kinetic energy rather than explosive warheads to destroy incoming threats, intercepting at altitudes of up to 150 km and ranges between 150-200 km.
Operated exclusively by American personnel, the US military maintains eight THAAD batteries with an estimated 350–400 interceptors in total. The eighth battery was activated during the June 20 Israeli aggression against Iran and is capable of intercepting hypersonic missiles. … continue
Blog Roll
Aletho News- ‘THAAD Delusion’: Iran war exposes US missile shield limits – The Atlantic
- Moscow issues warning to NATO over Russian exclave
- Yes, the Iran war has destroyed Trump’s presidency
- The fallacy of US delusions about Iran’s economic collapse
- Hezbollah denies Syria cell link, warns of Israeli plan to sow discord
- The legacy of US sanctions, war, and occupation in Iraq
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- How to MAKE THE CONSPIRATORS PAY for their crimes! Dan Dicks with James Corbett on Solutions Watch
- There’s a drought in academia: A drought in honest research on the subject of drought and other weather extremes
- If Americans Knew
- Iran’s Revolutionary Guards Publish Letter to the American People
- DMFI launches $1 million ad campaign supporting Virginia’s Elaine Luria
- US Senate blocks resolution seeking report on Americans killed by Israel
- Israeli Attacks Kill Ten Palestinians in Gaza
- Massacre at Minab: The School That Became a Grave
- Israeli media: The IDF Shows It Doesn’t Turn a Blind Eye; It Actively Emboldens Settler Havoc
- As settlers ravage West Bank, Israeli forces kill 10 in Gaza – Daily Update
- New Report: “Scholasticide and Genocide in Gaza: Assessment, Testimonies and Legal Analysis”
- Ex-Biden officials are desperate for a Gaza scapegoat
- Israeli “settlers” Invade Al-Aqsa; Pour Boiling Water on 75-Year-Old
- No Tricks Zone
- Green Energy Debacle: German Expert Professor Fritz Vahrenholt Warns Of Severe Economic And Social Consequences
- Two More Paleo Reconstructions Affirm Meters-Higher Sea Levels Across Ireland, Brazil 7000-6000 Years Ago
- New Study: Earth And Venus Surface Warmth Largely Explained By Convection And Lapse Rate, Not CO2 Or Radiation
- 2025 Nature Paper Claiming Worsening Global Drought Gets RETRACTED …Heavily Flawed
- New Study: ‘Global Drought Shows No Detectable Recent Acceleration Under Climate Warming’
- Economic Masterminds: German Socialists Suggest Taxing Productivity Gains Stemming From Using AI
- The South China Sea Has Not Been Cooperating With The Climate Change Narrative
- Energy Crisis: Germany Enters Heating Season With Historically Low Gas Reserve Fill Levels
- New Study: The Antarctic Ice Sheet Gained Mass From 2020-2024 Due To Staggering Snow And Ice Accumulation
- Study: Ocean Heating Rates From Thousands Of Years Ago ‘Dwarf’ Modern Ocean Heating Rates
