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Locals can own land now in Sinai according to new law

Ahram Online | 23 August 2011

The Egyptian Cabinet has issued a new law that permits the locals in Sinai to own land there, after years of denying them this right for security reasons. The cabinet also decided in a meeting to set up the Special Supreme Council for Developing Sinai, with an independent budget and jurisdiction, dedicated to the integrated development of the peninsula.

The new council’s headquarters will be in Sinai and its chairman will report directly to the prime minister.

The government has also decided to set up a new public university in North Sinai, and to issue a license for a private university in South Sinai. Moreover, the government will develop major roads in Sinai to improve tourism in the peninsula.

The government has decided to issue a quota for the employment of Sinai’s locals in public and private companies and projects.

It is also considering setting up a new governorate in the middle of the Sinai peninsula, as this zone in particular suffers from poverty.

August 25, 2011 Posted by | Economics | Leave a comment

Street fighting on first day of general strike in Chile

Pagina/12* – August 24, 2011

At least 36 detained and one injured policeman resulted from clashes on the first day of a strike called called by the United Workers Central (CUT) in support of student demands for egalitarian public education and also to demand constitutional reform and changes to the tax system and labor laws.

Beginning in the early morning, barricades were installed at various points in Santiago and important intersections of the main traffic artery, Alameda Avenue, were blocked with burning tires. In outlying areas buses were prevented from departing.

“Very few parts have paralyzed traffic and there is some delay from the barricades,” said Transport Minister Pedro Pablo Errazuriz.

Early on, Deputy Interior Minister Rodrigo Ubilla, noted that both in Santiago and elsewhere in the country “there is a normal situation” and said that public transport operated in accordance with the usual schedules. While the Secretary General of Government, Andrew Chadwick, had indicated that they had “some small pockets but have not been of greater magnitude.”

On the other hand, the president of the CUT, Arturo Martínez, refuted the government saying that they have struggled to “demonstrate normality while the whole country now knows there is nothing normal.”

Deputy Interior Minister Rodrigo Ubilla urged the leadership of the CUT to allow citizens to travel to work, and said police “will act to clear” the barricades. The crackdown was carried out at the time of the lowest level of popularity for the Piñera government which has been beleaguered for months by student demands.

The police measure is supported by the government coalition, which includes the Socialist, For Democracy, Radical Social Democratic and Christian Democratic parties. The national government responded to the strike actions with the threat of the possible application of the Internal Security Act, which allows for the arrest of protesters.

* Translated by Aletho News

Full Spanish language report

August 24, 2011 Posted by | Economics, Solidarity and Activism | Leave a comment

Globalist Richard Haas Calls for NATO Occupation of Libya

Tony Cartalucci | Black Listed News | August 22, 2011

The Financial Times has featured an editorial penned by Council on Foreign Relations president Richard Haas titled, “Libya Now Needs Boots on the Ground,” where the arch globalist states that Libya’s rebels are in no way capable of rebuilding Libya properly and will require an “international force” to maintain order. Haas breathtakingly admits that the NATO intervention to “protect civilians” was in fact a political intervention designed to bring about regime change. With NATO leading the offensive against Tripoli, a relatively calm city until now, the alleged cause of “protecting civilians” rings hollower than ever.

Haas goes on to explain that NATO’s “success” is what requires this international assistance in the predictable form of an occupation force to deal with looting, “die-hard regime supporters,” and tribal war. Haas also implores Obama to reconsider his decision to rule out American boots on the ground and to do so quickly.

Of course, NATO didn’t just spend the last 5 months conducting 7,000+ airstrikes on Libya to “protect civilians” and then ride off into the sunset. This was a war of conquest from the very beginning, with globalists openly declaring it would determine the “primacy of international law” over the nation-state. In fact, the initial uprising itself was gestated in Washington and London where opposition leaders were provided resources and safe-havens to conduct their sedition, with globalist stooges like Ibrahim Sahad literally sitting in front of the White House calling for NATO to bomb his homeland. NATO, its members, particularly the US, UK, and France, and the globalist corporate-financiers behind them, fully intend to rebuild Libya according to their own aspirations shoehorned into a national consensus imposed upon the Libyan people under the guise of “democracy” and “civil society.” We are watching a modern empire expand its boundaries into yet another sovereign nation.  […]

And indeed, as NATO rushes through to the finish line with a spectacular display of mass-murder and mayhem in Libya, and with the rebels dancing in the streets as NATO warplanes roar overhead, the time is soon approaching for Benghazi to pay back the West for their “help.”

As pundits in the duplicitous corporate media feign ignorance over the future of Libya, as if it is truly in the hands of the Libyan people as Obama cartoonishly portrayed in his latest teleprompter reading, the self-proclaimed “Transitional National Council” leader Gibril Elqarfally gave us cyrstal clear picture of Libya’s future – one inspired by globalization. In a May 12, 2011 talk before the Brookings Institution, he claimed “what’s taking place is a natural product of the globalizational process that started in the mid-80s.”

Elwarfally talks about a “new global cultural paradigm,” “new global values,” common values, shared by many “young people.” These young people, he says, are calling for human dignity, democracy, and inclusion at all levels of national government, repeating verbatim statements coming from geopolitical meddler Zbigniew Brzezinski and the myriad of US-funded NGOs that promote these “new global values.”

When asked by an audience member what Libya will look like in 2025, it turns out conveniently he was part of a study by Libyan professors and “Libyan practitioners” in 2007-2008 titled “Libya: Vision 2025.” Not surprisingly, this project was conducted with input from the IMF and involved Libya’s placement within the “global scene.” Elwarfally laments that Libya’s oil reserves are limited and that the solution is a transition to a service economy. He also claims Vision 2025s conclusion included an education shift, turning Libya into “a lake” to develop the skills of Africans to serve the needs of the European Union.
Surely Africans are eager to once again be in the service of wealthy Europeans, who at one point owned tremendous swaths of their continent, some tycoons naming entire nations after themselves in the ultimate expression of imperial megalomania. Elwarfally, a man educated in Pittsburgh, and apparently a lifelong fan of globalization, stuns us with his frank comments and his disturbing vision for the future of not only Libya, but the role it will play in directing Africa’s efforts and resources toward American and European corporate-financier interests.

While Qaddafi’s comments are dismissed out of hand, a recent message sent to his followers amidst fighting in Tripoli declared, “the traitors are paving the way for the occupation forces to be deployed in Tripoli.” It seems no truer words have ever been spoken and the Libyan people, including the rebels, will have no one but themselves to blame if they allow such a way to be paved. – Full article

August 22, 2011 Posted by | Economics, Illegal Occupation | Leave a comment

Pentagon Chit-Chat With Leon and Hillary

Panetta and the Defense Budget

By WINSLOW T. WHEELER | CounterPunch | August 19, 2011

The invitation came to me from Secretary of Defense Leon Panetta’s public affairs office to attend a “conversation” with Panetta and Secretary of State Hilary Clinton at the prestigious National Defense University in Washington. Although I knew it wasn’t me they wanted to talk to, I sat in the audience to hear Panetta and Clinton in action, especially on the subject of my prime interest: the defense budget.

The “conversation,” it turns out, was with Frank Sesno, the former CNN personality and currently director of George Washington University’s School of Media and Public Affairs. Sesno took the “conversation” assignment seriously; although he boldly said that it was important to “ask the tough questions” – just like a journalist – he did no such thing. Lofting over shallow dinner-talk queries, Sesno chummed it up with Panetta and Clinton and permitted them to say anything they wanted without fear of challenge.

Clinton tended toward impromptu speeches on whatever she was asked about; well articulated and forceful, much like she did as a senator at hearings where, rather than conduct oversight asking informed questions and following up, she would express her political points and neither seek nor reveal any new or deeper information.

Panetta was more subtle and single-minded. Although he comes from the same political background – White House insider and Congress – his answers were shorter and more softly stated, but they were directed at one and only one objective: defending the Pentagon’s budget.

Sesno started the “discussion” asking about budget cuts beyond the $350 billion the Pentagon has already committed to over the next 10 years, saying “What’s really at stake?” Panetta whacked the softball question hard: “Very simply, it would result in hollowing out the force,” and, “It would break faith with the troops and with their families,” and, finally, “It would literally undercut our ability to provide for the national defense.”

The bureaucratic moguls at the Pentagon, who currently preside over the largest defense or non-defense agency budget since the end of World War II, must have been delighted. After four years of sometime tough-guy Robert Gates, who fired senior officials for not toeing his line, DoD’s high spenders must be elated to have at the top someone who has leaped so quickly and with such eagerness to defending their agenda.

The $850 billion cut that Sesno was referring to does sound like a lot – if you are ignorant about the background and budget history. He offered no pushback and did nothing to probe Panetta’s budget preserving agenda, to question Panetta’s assumptions, and or even seek the data behind them.

Things didn’t get any better when Sesno allowed the audience a grand total of one question on DoD budget issues. The individual Sesno selected asked about funding for foreign language training. Panetta dutifully said it was important and that he wanted to look for “creative ways” to protect it. Clinton gave a speech about it, and the remaining 99.9 percent of the national security budget went unaddressed.

Instead of this feather-stroking chitchat, consider the following:

If the Pentagon’s “base” (non-war) budget were to be cut $850 billion, or so, over ten years, it would go down to about $472 billion annually, the approximate level of the base DOD budget in 2007. (This, not coincidentally, is about the same level of a new round of defense budget cutting hysteria circulating in Washington in response to a just released memo from OMB Director Jack Lew.)

Using the Pentagon’s “constant” dollars that adjust for the effects of inflation, that $472 billion level would be more than $70 billion higher than DOD spending was in 2000, just before the wars. Over ten years, base Defense Department spending would be almost three quarters of a trillion dollars above the levels extant in 2000. And, none of the additional monies to be spent on the wars would be eliminated.

At $472 billion per year, the Pentagon budget would be almost $40 billion more than we averaged, in inflation-adjusted “constant” dollars, during the Cold War when we faced an intimidating super-power, the Soviet Union, its Warsaw Pact allies and a hostile, dogmatically communist China.

At the 2007, 472 billion, level, our defense budget would remain more than twice the defense spending of China, Russia, Iran, Syria, Somalia, Cuba and any other potential adversary – combined.

The problem is not money. Under this so-called worst case scenario, the Pentagon would be left quite flush with money, plenty of it in historical terms.

The problem is that the Pentagon, as it exists under its current leadership, is incapable of surviving with less money. They quite literally do not understand how to face a future where the DoD budget exceeds any and all potential enemies by a multiple of only two.

Many – including Obama’s bipartisan 2010 National Commission on Fiscal Responsibility and Reform, a task force put together by congressmen Barney Frank (D-Mass.) and Ron Paul (R-Texas), yet another commission headed by former budget leaders Sen. Pete Domenici (R-NM) and OMB Director Alice Rivlin, and two alternative budget proposals from Sen. Tom Coburn (R-Okla.) – have itemized how to save about $900 billion from the national defense budget. The political landscape is littered with competent recommendations to remove many of the thick layers of hydrogenated fat from the Pentagon.

These proposals hit on many of the same soft spots in the DoD budget, such as the unaffordable, under-performing, years behind schedule F-35 Joint Strike Fighter. The implied consensus on such ideas and on the approximate amount (roughly $900 billion) suggest that the slightly lesser $850 billion in Pentagon savings is not “doomsday” (Panetta’s word) but quite endurable-and would actually leave DoD quite flush with cash.

But, it is unthinkable to Secretary Panetta, as it is to those who perform the enabling chitchat.

Winslow T. Wheeler is director of the Straus Military Reform Project and editor of “The Pentagon Labyrinth: 10 Short Essays to Help You Through It.“

August 19, 2011 Posted by | Economics, Militarism | Leave a comment

Crisis and Class Struggle in the Eurozone

The Cases of Spain, Greece, Ireland and Portugal

By VICENTE NAVARRO | CounterPunch | August 19, 2011

To understand the situation in the countries at the periphery of the European Union, four countries within the Eurozone, Portugal, Ireland, Greece and Spain, we have to understand the political context they have in common. All of them were governed by fascist or fascist-like dictatorships (Spain, Portugal, and Greece) or by authoritarian right-wing regimes (Ireland) for most of the period from the late 1930s or early 1940s until the late 1970s. This history is usually ignored in analyses of these countries.

This shared history, however, has determined the nature of their states, a critical variable for understanding countries’ economic behavior. Their states have been very repressive. Even today, these countries have the largest number of policemen per 10,000 individuals in the EU-15. Another shared characteristic is their very low level of state revenues and their highly regressive fiscal policies. The revenues to the state are much lower than the EU-15 average: approximately 34% of GNP in Spain, 37% in Greece, 39% in Portugal, and 34% in Ireland, compared with the EU-15 average of 44%, and compared with 54% in Sweden – the EU-15 country where the left has governed for the longest period. The low state revenues result from extremely regressive policies. The super-rich, rich, and high-income upper middle classes do not pay taxes at the same level and intensity as those in most of the central and northern EU-15 countries – a consequence of a history of government by ultra-right-wing parties. Of course, progress has been made since the dictatorships ended. But the dominance of conservative forces in the political and civil lives of these countries explains why their state revenues are still so low.

As a result, the public sectors in Portugal, Ireland, Greece, and Spain are extremely underdeveloped. And their welfare states are poorly funded and very limited, including their public transfers (pensions) and public services (medical care, education, childcare services, homecare services, social services, and others). Indicators of this are many. One example is public social spending as percentage of GNP, which is lower in these countries than the EU-15 average (27%): Spain, 22.1%; Greece, 25.9%; Portugal, 24.3%; and Ireland, 22.1% (compared with Sweden, 29.3%). Another example is the percentage of the adult population working in public services of the welfare state – again, lower than the EU-15 average (15%): Spain, 9%; Greece, 11%; Portugal, 7%; and Ireland, 12% (compared with Sweden, 25%). In fact, Greece’s percentage is three points higher, 14%, because it includes services for the military, (which represents approximately 30% of public employees).

The specificity of the political regimes

Thus, for these four countries, not enough attention has been paid in the economic literature to the consequences of being governed by ultra-conservative forces. The influence of such forces has been enormous. It is also important to emphasize that the conservative forces in these peripheral countries are different from those in northern and central EU-15 countries. They do not belong to democratic traditions since they are the inheritors of either fascist or authoritarian regimes. Even today, after almost 30 years of democracy, such forces continue to be very influential in the four states, even when the states are governed by social democratic parties. As just one example, Spain’s Supreme Court has taken Judge Baltasar Garzon, who used to be a member himself of the Court, to trial for daring to inquire about crimes committed by General Franco’s fascist regime. It is not fully comprehended outside Spain just how influential the ultra-right-wing forces still are within the Spanish state. They dominate political culture in many different ways, including control of the major media. There are no major left or left-of-center media in Spain, or in the other countries in this group.

The domination of the state by ultra-conservative forces has many consequences besides their low level of state revenues, their regressive fiscal policies, and their underdevelopment of the welfare state. Labor income, as percentage of national income, has declined since 1992, when policies were implemented (including by social democratic governments) in preparation for entering the Eurozone. This income decline has occurred more rapidly in Portugal, Ireland, Greece, and Spain than the EU-15 average, and is particularly accentuated in Spain, with a decrease from 70% to 61% of national income – despite an increase in the percentage of working adult population.

As noted, a consequence of domination by conservative forces, considerably limiting the public reforms approved and implemented by social democratic governments from the early 1980s onward, is regressive fiscal policies. As a result of these policies, the impact of state interventions on income redistribution has been very limited. For example, in Spain, as late as 2009, the level of poverty (60% of median income) declined only 4 points after implementation of state interventions (public social transfers): from 24% before to 20% after transfers. The EU-15 average decreased from 25% to 16%. Sweden’s poverty rate fell from 27% to 13%. The decline in poverty rate resulting from public social transfers in Spain is the lowest in the EU-15. Another indicator of the limited redistributional impact of state interventions is that the Gini coefficients in all four countries are higher than the EU-15 average (29.2). Spain’s Gini coefficient is 31.3, the same as Ireland’s; Greece’s is 34.3; and Portugal’s is the highest at 36.8.

How the crisis has been building up

Another characteristic of this group of countries is the acceptance by the governing social democratic parties of most of the neoliberal policies pushed by the EU establishment. This acceptance has been generalized among the social democratic parties of the European Union. Actually, these parties were part of the consensus in developing neoliberal policies (usually referred to as the “Brussels consensus,” the European version of the “Washington consensus”). As part of this consensus, both conservative-liberal and social democratic governing parties have been reducing taxes, particularly for the top income brackets. It was none other than Spain’s socialist candidate in the 2004 election (and later prime minister), Jose Luis Rodriguez Zapatero, who promised to reduce taxes if elected, saying that lowering taxes was a cause to be promoted by the left. The major economic thinker of Spain’s socialist party at that time was Jordi Sevilla, an economist who wrote in his book The Future of Socialism that “the left had to stop raising taxes and increasing public expenditures” – this said in the EU-15 country with the lowest state revenues and poorest welfare state.

The tax reductions over the past 15 years have led to a structural public deficit that was disguised by the fast economic growth created by the housing bubble, responsible for the banking–real estate–construction industry complex at the center of the bubble. When the bubble burst, and the economy came to a halt, the structural public deficit appeared in all its intensity. The public deficits in Portugal, Ireland, Greece, and Spain were the result of declining state revenues, not expanding public expenditures. This is why the public policies of these governments are profoundly wrong. They have been cutting public spending, assuming, incorrectly, that the cause of public deficits was an exaggerated growth of public expenditures.

Arguments used to justify cuts in public expenditures

The slogan now being used to justify these cuts is: “The country has been living beyond its means.” Major political figures in the four countries claim that their welfare states are larger than they can pay for. But the data show otherwise. In Spain, for example, the GNP per capita is 94% of the EU-15 average, but public social expenditure per capita is only 72% of the EU-15 average. If it were 94%, the Spanish state would have 66,000 million more euros than it does today. So, Spain has the resources. The problem is that the state does not collect them, because its fiscal policies are so regressive and fiscal fraud is widespread among high-income groups and economic and financial corporations. Actually, banking in Spain is the primary entity responsible for fiscal fraud. Mr. Botin, the country’s major banker (president of Santander Bank, the third most profitable bank in the world, after two Chinese banks), was discovered this year to have 2,000 million euros in a Swiss bank account – not declared until two whistleblowers at the bank went to the press. Such fraud is general practice. The tax inspectors of Spain’s Ministry of Economy estimate there are 88,600 million euros that the state does not collect because of tax fraud.

How and why the crisis arose

Before the financial crisis there was an economic crisis, largely the result of the decline in labor income as percentage of total national income. The neoliberal policies developed since the 1980s (accentuated over the past 15 years, and carried out by governments of various political persuasions, including social democratic, in Spain, Greece, and Portugal) have had a strong impact on income distribution, accelerating the concentration of income in the high income brackets. The decline of labor-derived income diminished the purchasing power of the popular classes, forcing them into debt in order to maintain their standard of living. And credit was relatively easy to obtain, because house values were rising and provided a means of borrowing from banks by putting up homes as security. The growth of the credit sector (and of financing) was based on the decline of labor income. But the decline of labor income was creating a major problem for demand and limited profitability in the economy.

With this limited profitability in the productive economy, the super-rich, rich, and upper-income middle class invested in sectors with higher returns, especially in real estate. The deregulation of banking (and deregulation of zoning laws) during the 1990s led to a real estate bubble, based on the complex of banking, real estate, and construction industries. In Spain, this complex was the main motor of economic growth and was supported by both central and local authorities, since local authorities were primarily funded by property taxes.

Stimulating the growth of housing construction was the influx of immigrants, with the immigrant population increasing from 4% to 10% of the population in only 10 years. Housing construction reached 10% of GNP, and this sector produced the most (but very low-paid) jobs. The Spanish “miracle” of job creation was based on large investments in a speculative sector of the economy. And it was funded with debt. This is the cause of the enormous private debt in Spain, which was facilitated by introduction of the euro – much more stable in the economy than the national currency it replaced. Introduction of the euro dramatically increased the size of the financial sector in the four peripheral Eurozone countries. When the bubble burst, the whole credit economy came to a stop.

The political origins of the public debt

In the four countries, there has been an alliance between the upper income brackets (the super-rich, rich, and upper middle class, whose taxes have been reduced in the past 15 years) and the banks, on the one hand, and the state, on the other. A fruit of this alliance was the reduction in taxes that created the structural public deficit, masked by the economic growth within the bubble.

The decline of revenues to the states (the consequence of tax cuts) forced the states to borrow from the banks, where the rich deposited the money saved due to reduced taxes. The indebtedness of the states and the need to borrow were clearly related to the reduction of taxes. When the economy came to a stop as the bubble burst, the structural public deficit became apparent. Public deficits as percentage of GNP, increased substantially in all four countries from 2007 to 2009 as a consequence. Spain went from a surplus of 1.9% of GNP in 2005 to a public deficit of 11.1% in 2009. Greece went from a deficit of 6.4% in 2007 to 15.4% in 2009, with Ireland moving from 0% to 14% in the same period. In all of them, rapid growth of the public deficit was based on the extremely regressive nature of state revenues. With most taxes based on labor income and consumption, when employment declined, unemployment grew, and consumption declined, the public deficit escalated dramatically.

Solutions that are never considered

The neoliberal response to this situation, which entails cuts in public expenditures, is making the situation worse because it reduces demand. The trade unions have accurately described neoliberalism as the ideology of banks and large employers. The major media support this doctrine, based more on faith than on evidence. At the root of the problem is class power and its realization through the state.

If Spain implemented the same fiscal policy as Sweden, the Spanish state would take in 200,000 million more euros than it now does. With those millions of euros, it could create 5 million new jobs (particularly in the underdeveloped welfare state services, such as the national health service, educational system, childcare services, and other social services). If one in every four adults worked in such services (as occurs in Sweden), instead of one in every ten adults (as occurs now in Spain), Spain would create 5 million more jobs, eliminating unemployment: 5 million is more or less the number of people currently unemployed in Spain.

A second point is that the fiscal stimulus applied by most of the governments in this group of countries in 2008 was basically tax cuts and transfers. Only a miniscule part of the stimulus went to creating jobs (through investment by local authorities). Stimulating the economy through the creation of jobs has not occurred in any of these countries. Moreover, reduction of the deficit is achieved by cutting public expenditures, not by increasing taxes. The European Federation of Trade Unions has proposed alternative ways of reducing the deficit, primarily by increasing taxes (reversing the tax reductions of the past 15 years). Class power, however, is the most potent opposition to these alternative policies. A manufacturing worker in Spain pays taxes estimated at 74% of the taxes paid by a manufacturing worker in Sweden. The top 1% of income earners in Spain, however, pay only 20% of the taxes paid by the top 1% in Sweden. This is what explains the enormously regressive fiscal policy in the four peripheral EU-15 countries and the enormous resistance to change by their dominant classes.

The problem of the public debt is thus basically a political, not an economic or financial one. The current situation is untenable because Europe’s dominant classes and their allies, the EU leadership (“the troika”: the European Council, European Commission, and European Central Bank), are trying to reduce the power of labor using the argument of “pressure from the financial markets” – the aim being to get labor to accept the huge sacrifices that the dominant classes have wanted for many years. In Spain, for example, the socialist government is cutting public social expenditures, which, besides adversely affecting economic growth and reducing level of demand, is hurting the popular classes. The parties to the left of the governing socialists have clearly shown that for each cut in public social expenditures, the government could obtain even larger revenues by selectively increasing taxes, which would not affect taxes for the majority of the population. Moreover, they have shown that the revenues obtained with those taxes could create jobs in the underdeveloped public sector, especially in the welfare state.

Another issue is that, at this time, no major force on the left has called for exit from the euro. An explanation for this is that Europe has always been a point of reference for progressive democratic forces. In Spain, for example, under the fascist dictatorship, Europe meant liberty, democracy, and the welfare state. The attraction of Europe is now waning, though not very rapidly. Because of this, most of the debate centers on correction of the fiscal regressiveness of the state and development of expansionary policies as a way of stimulating economic growth and job production. Sectors of the left in Spain believe this is not possible, pointing to the Mitterrand case as an example of how one country cannot follow expansionary policies. This needs to be shown as wrong, although expansionary policies at the European level would help a lot. This is unlikely to occur at this time, however, given the control of the major EU institutions by neoliberal dogma.

The indignados movement

Meanwhile, a new movement has appeared which has surprised everyone. Initially led by the young unemployed, it has attracted enormous support from the majority of the population. Its primary focus is on denouncing the absence of democracy, in Spain and elsewhere in Europe, showing how governments are making decisions not mandated by the population. This movement is going to the root of the problem: the nature of democracy and who it is that democratic institutions are representing. Of course, in Spain, the government is worried about this movement. The candidate of the governing socialist party, hoping to succeed Zapatero (the Spanish president with the least popular support during the democratic period), has called for increased taxation of the bankers and the banks to help resolve the fiscal problems of the state. This is important because the proposal is a response to the public outrage directed at banking and the wealthy. The financial and industrial bourgeoisie are seen as using the “pressure of the financial markets” as a way of getting what they have always wanted: to weaken labor. And what is really threatening to the establishment is that all the polls show enormous sympathy for this popular movement, including among large sectors of the conservative parties. We will see what happens next.

~

Vicente Navarro is Professor of Public Policy, the Johns Hopkins University and Director of the Public Policy Program jointly sponsored by the Pompeu Fabra University (Barcelona, Spain) and the Johns Hopkins University (Baltimore, MD)

The work of Marta Tur, Miquel Campa Sole and Maria Allwine in the preparation of this article is gratefully acknowledged.

August 19, 2011 Posted by | Economics | Leave a comment

Money leaves from “Western” banking system as consequence of Libya asset grab

Moon of Alabama | August 17, 2011

When the U.S. promised the Libyan rebels access to Libyan government accounts I predicted that one of the consequences of this would be a retraction of sovereign funds from the “western” financial systems:

Anyone in power somewhere around the world is now advised to not keep any money in a U.S. based banking account. As soon as some idiots come up and proclaim a revolution, the U.S. will likely seize that money and give a few crumbs of it to the revolution leader. (The rest will be taken by the usual banking crooks.)

This will be one of the many blowbacks from this lunatic attack on Libya.

Today the Wall Street Journal reports:

Venezuela plans to transfer billions of dollars in cash reserves from abroad to banks in Russia, China and Brazil and tons of gold from European banks to its central bank vaults, according to documents reviewed Tuesday by The Wall Street Journal.The planned moves would include transferring $6.3 billion in cash reserves, most of which Venezuela now keeps in banks such as the Bank for International Settlements in Basel, Switzerland, and Barclays Bank in London to unnamed Russian, Chinese and Brazilian banks, one document said.

Moving its money away from accounts where “western” government can confiscate it at a whim is good for Venezuela. It takes away a major graft motive for “western” induced revolutions and thereby lowers the chances of one occurring.

For a “western” banking system that lacks basic capital the move is not a positive sign. But given the example Obama set with Libya we can expect that more countries will silently follow this move.

~

See also:

UNASUR prepares to ride out economic upturn from the North

August 17, 2011 Posted by | Corruption, Economics, Timeless or most popular | Leave a comment

Donors help keep Palestinians in cages

By Charlotte Silver | The Electronic Intifada | 16 August 2011

Ramallah – “Israel besieges us, puts us in cantons — in cages — and the international community is feeding us in these cages. It’s anything but developmental and it’s helping Israel’s colonization, ethnic cleansing and dispossession,” Dr. Samia Botmeh said, as she sat in her office in the Center for Development Studies (CDS) at Birzeit University near Ramallah in the occupied West Bank.

Despite the massive amounts of development aid that have been poured into the West Bank, the productive capacity of the Palestinian economy — measured by examining the agricultural and manufacturing sectors — is half that of 1994, and accounts for no more than 12 percent of employment. While the World Bank and Palestinian Authority boast an 8 percent growth in gross domestic product (GDP), real per capita income is still 8.4 percent lower than what it was in 1999, signifying that the GDP growth is not reflective of income growth for the average Palestinian.

Egypt provides an elucidative comparison. Two decades of serious neo-liberal reforms produced a GDP growth in Egypt that was similarly applauded by the International Monetary Fund (IMF): between 2006 and 2008, GDP grew 7 percent and there was a 4.6 percent spike in 2009 alone. However, as was made stunningly clear at the end of January, the country’s GDP growth had not trickled down to the majority of the people: unemployment had actually increased and 40 percent of the population lived on less than two dollars per day.

With former IMF representative Salam Fayyad at the helm since 2007, the PA has adopted the strategy of neo-liberal “good governance” as its framework for the state-building project. As post-colonial states have done in the past, the PA has sought to create an environment conducive for efficient and free-flowing markets by privatizing public services, emphasizing private property rights and reducing corruption. This agenda — state-building through neo-liberal policies — is most patently set forth in a PA program titled “Ending the Occupation, Establishing a State.”

As Mustaq H. Khan, an economics professor at London’s School of Oriental and Afrian Studies, pointed out in a lecture in Ramallah last winter, the injection of development aid into Palestine has deceptively flattered the PA’s good governance program, leading onlookers and promoters such as the IMF and World Bank to attribute the boost in GDP to a successful market economy (“Post-Oslo State-Building Strategies and their Limitation,” 1 December 2010 [PDF]).

There is still a stark contrast between the perceived improvement in the Palestinian economy and the actual standard of living for the majority of Palestinians. Development aid — which comprises roughly 40 percent of Palestine’s GDP — has been complicit in obscuring economic reality and in some cases truncating Palestine’s struggle for national liberation.

In June 2011, Birzeit University held a conference at which activists and academics spoke with donors and a representative from the PA on the failures of development, as well as the troubling role development aid plays in Palestine’s national movement.

“The framework of development is extremely unrealistic and problematic,” Dr. Samia Botmeh told The Electronic Intifada. The framework under scrutiny at Birzeit was the United Nations Development Programme’s Conflict-Related Development Analysis (CDA), which seeks to maximize the impact of development aid in conflict zones.

Botmeh added that the current international framework for assessing development aid in the West Bank treats the Israeli-occupied region either as a conflict zone or a post-colonial zone. “This is completely unrealistic because we are not in a conflict, we are in a colonization process,” she said.

The conference took place after the university’s Center for Development Studies concluded a project commissioned by the UNDP that examined how development funds could be better allocated in the occupied West Bank and Gaza Strip amid Israel’s continued occupation.

Because the CDA framework attempts to implement “development” projects while avoiding any political position, the study found that it implicitly assumes both parties have a reason to compromise. This fundamentally flawed approach refuses to acknowledge — and therefore address — the stark power imbalance that allows Israel to remain intransigent.

Realizing that reallocating funds would not address the fundamental hindrances to achieving economic self-determination through development in Palestine, the center articulated what development should look like in the context of an active colonization process. “Development should be about more than helping people survive; it should be about ending colonization,” Botmeh explained.

The Center for Development Studies’ critique shows how development fails to achieve much of anything tangible for Palestinians, and — even more ominously — serves to fortify Israel’s occupation and further annexation of land.

Development confined to “state-building”

After the implementation of policies dictated by the Oslo Accords, signed by Israel and the Palestine Liberation Organization in the mid-1990s, international aid to Palestine took a turn toward development. Previously, aid to Palestine was earmarked for “humanitarian” purposes such as UN operations and charity. With the establishment of the Palestinian Authority as a transitional government, development aid was ostensibly intended to promote an independent economy that would facilitate a smooth transition to a Palestinian state.

After 18 years of an ostensible peace process — of which the agency of the Palestinian national liberation struggle has been confined to a “state-building” project by the PA and Israel — Palestinians’ standards of living have decreased, while inequality has increased.

Botmeh believes that the underlying assumption of this development aid is that it is being funneled into a post-colonial state and that Israel has an intention to withdraw from the West Bank and Gaza Strip. These assumptions, blatantly oblivious to any political reality, have allowed development aid to reinforce Israel’s colonization through the continued degradation of Palestine’s territorial contiguity and the ongoing depopulation of Area C — more than 60 percent of the West Bank, including East Jerusalem, that is under full Israeli military control.

Under the Oslo accords, the occupied West Bank and Gaza Strip were carved up into areas A, B and C, the last of which is administered and controlled by the Israeli government and its military. Israel has declared three-quarters of the land as “closed military zones” or nature reserves, and therefore “off-limits” to Palestinians. Approximately 40,000 Palestinians live in Area C.

The 1999 deadline for the termination of the West Bank’s geographic stratification into Areas A, B and C has long passed. Far from assisting in the formation of a viable state, development aid has served to entrench the partitioning of the land.

Peter Lundberg, a representative of the Swedish International Development Cooperation Agency, confirms these faults in the current development paradigm in Palestine. Speaking from the perspective of an international donor, Lundberg excoriated the complicity of development aid in fragmenting Palestinians by only working in Area A due to Israeli restrictions in Area C.

“Donors and the PA have been too focused on state-building, which is important, but they are going to lose critical parts of the land,” Lundberg said. “Development should help Palestinians stay on their land; too many have left [their land in] Area C.”

Because implementing projects in Israeli-controlled Area C are logistically burdensome and in many cases impossible, donors are inclined to contribute to projects in Area A.

According to Lundberg’s statistics, there has been an exodus of Palestinians from Area C mostly due to the impossible living conditions Israel has created and the predatory nature of surrounding settlements. Israel does not allow communities to be connected to sources of water or electricity and refuses nearly every request for a building permit, thus leading to the destruction of water-collecting devices, schools and homes. In contrast, settlements sitting next to these Palestinian villages are afforded free-running water, electricity, roads and expanding infrastructure.

In 1967 there were approximately 200,000 Palestinians living in the Jordan Valley, which is designated Area C, except for the Palestinian city of Jericho. Today, there are only 56,000, 40,000 of whom live in Jericho (in Area A), according to statistics from the international aid agency Save the Children.

The devastating picture that these statistics reveal is that donors have been complicit in aiding Israel’s process of cantonizing the West Bank into the 18 percent that comprises Area A. By doing so they have helped to surrender the majority of the West Bank’s land and agriculture — which could form the basis of a genuine self-sustainable Palestinian economy and state — to Israel’s control.

Neo-liberalism undermining Palestinian rights for self-determination

Raja Khalidi, a senior economist with the United Nations Conference on Trade and Development (UNCTAD), has written that the development enterprise — representing $1.5 billion a year — is taking place inside territories that have been tagged by the World Bank, European Union, IMF and United States as a site for expanding a neo-liberal project (see “Neoliberalism as Liberation: The Statehood Program and the Remaking of the Palestinian National Movement,” Journal of Palestine Studies, Vol 40, no. 2, Winter 2011).

In the PA’s neo-liberal paradigm — as enshrined in the “Palestinian Reform and Development Plan” of 2008-10 and “Ending the Occupation, Establishing the State” — economic growth is promised as a consolation for occupation rather than a strategy to resist it.

Speaking at the conference, Khalidi remarked on the absurdity of such an agenda in the context of an occupation that ultimately determines Palestine’s economy. “For the last three years, the PA has been routing out internal obstacles to state-building, while the PA has no structure to tackle external obstacles,” he said.

Moreover, without sovereignty, genuine economic growth is out of reach. Khalidi explained that the PA is not only unable to counteract Israel’s aggressive policies of colonization but it also does not have the ability to exercise control over Palestine’s macro-economic policies — such as its own currency and control over interest or exchange rates.

Development aid has long been faulted for its inadvertent assistance in sustaining the occupation by reducing its humanitarian impact and thus making it more palatable. However, Omar Barghouti, a leading figure of the boycott, divestment and sanctions (BDS) movement, revealed the disingenuous nature of international development aid.

“Development exudes complicity in colonialism; it’s intentional and it’s complicit — ignorance is not an excuse,” he said at the conference.

Barghouti proffered several examples of countries throwing some money at the cause of development in Palestine while concurrently supporting projects or companies that actively undermine Palestinian sovereignty.

Veolia, a French transportation corporation that according to Barghouti is mostly owned by the state, is currently building Jerusalem’s new light rail system. The Jerusalem light rail connects West Jerusalem to illegal settlement blocs in occupied East Jerusalem. Despite targeted pressure on Veolia to withdraw from the light rail project — part of a global BDS campaign that has cost the company up to $10 billion, according to Barghouti — the company and by extension France have held onto their contract with Israel.

Restoring class struggle to the national liberation struggle

Adam Hanieh, a lecturer in development studies at the School of Oriental and African Studies, situates development aid in the longer arc of Israel’s colonization of the land through systematic fragmentation of the Palestinian people and nation. In his lecture at Birzeit, Hanieh restored the importance of class struggle to the goal of national liberation and exposed development aid as working against Palestinian unity undivided by wealth or class, against the occupation.

“Sixty-three years of colonization have seen the division, fragmentation and fracturing of the Palestinian people. Development must confront this fragmentation, not aid it,” Hanieh explained to the audience.

Illustrating how neo-liberalism has encouraged the notion that the solutions to problems are individual in nature rather than collective, Hanieh stressed that much of the “development” one sees arising in the West Bank benefits Israeli business. For example, consumption in Ramallah’s flourishing restaurant and café culture is mostly funded by this development aid — and in turn sustains the importation of Israeli products. Poignantly, this new consumer class — enabled by development aid — creates one more isolated stratum of Palestinian society.

All this continues against the backdrop of the regional popular uprisings against, among other things, neo-liberal policies. These uprisings showcase an exemplary shaking off of dictators and the present world order and the inspiring potential of class struggle.

If development aid programmes set freedom — rather than the introduction of a neo-liberal state — as their principal objective for Palestinians, then they may begin to counter the 63-year process of confiscation and colonization. Otherwise, they will be offering that process a helping hand.

Charlotte Silver is a journalist based in the West Bank. She can be reached at charlottesilver A T gmail D O T com.

August 16, 2011 Posted by | Economics, Ethnic Cleansing, Racism, Zionism | Leave a comment

Egypt accepts US$2 billion from World Bank

By Sara Nour Eldeen | AlMasry AlYoum | August 11, 2011

The Ministry of International Cooperation has accepted US$2 billion in grants and loans from the World Bank under the Partnership for Development program.

Minister for Planning and International Cooperation Fayza Abouelnaga has signed an agreement for a grant of US$247 million for ministry employees dealing with international and regional organizations and financial institutions. The grant comes from the World Bank’s Institutional Support Fund.

The minister will also sign an agreement for a US$330 million loan from the bank, in order to modernize the 250 km railway line between Beni Suef and Assiut, in addition to another US$100 million loan for modernizing a 200,000 acre irrigation system in the New Valley region.

The World Bank will also give Egypt a loan of US$600 million to finance the North Giza power station, and another two totaling US$219.75 million to connect the Gulf of Suez wind energy station to the main electrical grid.

August 12, 2011 Posted by | Economics | Leave a comment

Does the World Really Need New and Improved Nuclear Weapons?

How to Save a Quarter Trillion Dollars

By LAWRENCE S. WITTNER | CounterPunch | August 10, 2011

In the midst of the current stampede to slash federal spending, Congress might want to take a look at two unnecessary (and dangerous) “national security” programs that, if cut, would save the United States over a quarter of a trillion dollars over the next decade.

The first of these is the Obama administration’s plan to spend at least $185 billion in the next ten years to “modernize” the U.S. government’s nuclear weapons arsenal. At present, the U.S. government possesses approximately 8,500 nuclear warheads, and it is hard to imagine that this country would be safer from attack if it built more nuclear weapons or “improved” those it already possesses. Indeed, President Barack Obama has declared—both on the 2008 campaign trail and as president—that he is committed to building a world without nuclear weapons. This seems like a perfectly sensible position—one favored by most nations and, as polls show, most people (including most people in the United States). Therefore, the administration should be working on securing further disarmament agreements—not on upgrading the U.S. nuclear arsenal in preparation for future nuclear confrontations and nuclear wars.

In late June of this year, Archbishop Desmond Tutu, a Nobel Peace Prize laureate, wrote: “It is deeply troubling that the U.S. has allocated $185 billion to augment its nuclear stockpile over the next decade, on top of the ordinary annual nuclear-weapons budget of more than $50 billion.” Not only has the International Court of Justice affirmed that nations “are legally obliged to negotiate in good faith for the complete elimination of their nuclear forces,” but “every dollar invested in bolstering a country’s nuclear arsenal is a diversion of resources from its schools, hospitals, and other social services, and a theft from the millions around the globe who go hungry or are denied access to basic medicines.” He concluded: “Instead of investing in weapons of mass annihilation, governments must allocate resources towards meeting human needs.”

Another project worth eliminating is the national missile defense program. Thanks to recent congressional generosity, this Reagan-era carryover, once derided by U.S. Senator Edward Kennedy as “Star Wars,” is currently slated for an increase in federal spending, which will provide it with $8.6 billion in fiscal 2012.

The vast and expensive missile defense program—costing about $150 billion since its inception—has thus far produced remarkably meager results. Indeed, no one knows whether it will work. As an investigative article in Bloomberg News recently reported: “It has never been tested under conditions simulating a real attack by an intercontinental ballistic missile deploying sophisticated decoys and countermeasures. The system has flunked 7 of 15 more limited trials, yet remains exempted from normal Pentagon oversight.”

Carl Levin, the Michigan Democrat who chairs the Senate Armed Services Committee, reported that his committee was “deeply concerned” about the test failures of the nation’s missile defense program. He also implied that, given the disappearance of the Soviet Union, the United States might not need such a system to deter its potential enemies, which have a far inferior missile capability. “The threat we have now is either a distant threat or is not a realistic threat,” he remarked.

Why, then, do other nations—for example, Russia—fiercely object to the deployment of a U.S. missile defense system near their borders? Perhaps they fear that, somehow, U.S. scientists and engineers will finally figure out how to build a system, often likened to hitting a bullet with a bullet, that makes the United States invulnerable while they are left vulnerable. Or perhaps they think that, one day, some U.S. government officials might believe that the United States actually is invulnerable and launch a first strike against their own nations. In any case, their favorite solution to the problem posed by U.S. national missile defense—building more nuclear-tipped missiles of their own—significantly undermines the security of the United States.

Projecting the current annual cost of this program over the next decade, the United States would save $86 billion by eliminating it.

Thus, by scrapping plans for nuclear weapons “modernization” and for national missile defense—programs that are both useless and provocative—the United States would save $271 billion (well over a quarter of a trillion dollars) in the next ten years. Whether used to balance the budget or to fund programs for jobs, healthcare, education, and the environment, this money would go a long way toward resolving some of the nation’s current problems.

~

Dr. Lawrence S. Wittner is Professor of History at the State University of New York/Albany. His latest book is Confronting the Bomb: A Short History of the World Nuclear Disarmament Movement (Stanford University Press).

August 10, 2011 Posted by | Economics, Militarism, Progressive Hypocrite | Leave a comment

Iran discovers new gas field

Press TV – August 8, 2011

Managing director of the National Iranian Oil Company (NIOC) Ahmad Qalebani says a new gas field has been discovered in eastern Asalouyeh.

“The gas field, named Madar and located 15 kilometers east of Asalouyeh, has reserves of about 495 billion cubic meters of gas,” Qalebani said on Monday.

Qalebani estimated the value of the gas field at USD 133 billion, Fars News Agency reported.

In June, Iran discovered Khayyam gas field with in-place reserves of 277 billion cubic meters of natural gas in the southeastern port city of Asalouyeh in Hormozgan Province.

The Islamic Republic discovered 13 new oil and gas fields with in-place reserves of 14 billion barrels of oil and 45 trillion cubic feet of natural gas from August 2009 to August 2010, Iran’s Oil Ministry reported.

Iran has 137.6 billion barrels of proven oil reserves, and 29.61 trillion cubic meters of proven gas reserves. It has the world’s third largest oil reserves and second largest gas reserves.

August 8, 2011 Posted by | Economics | Leave a comment

Shop and Shoot

By Linh Dinh – State of the Union – 8/3/11

We are being ruled by thespians and gangsters. Far from incompetent, they are lethally good at what they do. They create crisis after crisis, then solve each by sacrificing countless innocents while enriching themselves. Whatever the challenge, domestic or international, their only goals are to gorge and to gouge, so they never fail, actually, even when they miscalculate. They’ll make money blowing things up, and they’ll make even more pretending to fix what they have destroyed. They never pay for their mistakes, only you do, and when they function perfectly, you will still pick up the check, if not bleed. In fact, you will pay even more if they’re in top form.

During this never ending public spectacle, they’ve introduced us to a cast of rather outlandish characters: a stuttering Texas idiot; a fist bumping, long range shooting and Harvard educated Muslim Commie; a blow job-loving burger clown. Splitting into opposing camps, they’ve climbed into a ring to perform for the whole world. In the front row, a mob of rightish and leftish pundits. These ad-peddling charlatans have parsed each choke slamming and brain busting move as if it was real. Thus, Obama tapped out on canvas. Thus, Obama steam rolled by Republicans. Thus, Obama’s bad bargain. Obama caved in. He’s no criminal, he’s weak. Thus, Obama surrendered.

Those who don’t swallow entire these farcical blow by blows are branded nutcases and conspiracy theorists. Whether it’s about 9/11, Bin Laden, Iraq, Afghanistan, War on Terror, Iran, Underwear Bomber, BP oil spill, Corexit, Libya, death of Bin Laden, on and on and on, the official narrative is always, and I mean always, nonsense, yet repeated often enough, from all angles, left, right and center, these clumsy fairy tales will coalesce in the brainpans of the inattentive or stupid as uncontestable truths and history.

In spite of all the recent bombast about fiscal responsibility and shared sacrifice, the wasteful wars continue, though few Americans can tell you why or even where we’re unleashing horror, hatred and sorrow. America must kill because wars are so lucrative. No other country has been fighting so continuously, for so long. Anham, a Northern Virginia company, has just been busted for charging the Pentagon $900 for a $7 control switch, $3,000 for a $100 circuit breaker, and $80 for a $1.41 piece of plumbing equipment. Blah, blah, blah. Tell me something new, why don’t you? And Lockheed Martin has just been given a $72 million contract to install those universally despised irradiating scanners at 300 U.S. airports.

Meanwhile, one in six Americans is on food stamps, and more and more Americans are losing jobs, including teachers, firemen and cops, as unemployed and deranged teens run wild in “flash mobs” to beat up random strangers. It has happened repeatedly in Philadelphia, my neck of the woods, as well as Chicago, Milwaukee, Kansas City, Boston, Brooklyn, South Orange and Greensboro. There are racial and class components to this phenomenon, as these wilding youngsters are invariably poor blacks converging on white shopping districts. In the latest episode, an 11-year-old Philly kid was arrested for assaulting a stranger.

With these mobs, all the pathologies of a post-industrial, post productive society, with its dead-end jobs, bad schools and a nonstop, stupefying media, are on full display. Another factor not often cited is the phenomenon of children being raised almost exclusively by strangers, practically right after birth, and the poorer the kids, the crappier the quality of daycare and subsequent schooling. How many times have you seen black women push strollers with well dressed white children, so the rich kids are pampered by their parents and nannies, while the poor ones are left alone in nightmarish neighborhoods. Also, when your government is so openly corrupt, anger is inevitable, although punching a stranger in the face is certainly not a solution. The biggest criminals are out of sight, leaving us bottom feeders to inflict pain on each other.

In any struggle, it’s important to know the nature of your enemy. Is he a klutz, prone to a goofy mistake now and then, or does he have murder on his mind? Again, we are being lorded over by a gang of criminals. War criminals.

For two years, there was a military entertainment complex inside a Philadelphia area shopping mall. At the Army Experience Center, young teens could play shoot them up, blood splattering video games for free, while those over 18 could climb into a realistic mockup of a tank or chopper to massacre bad guys in desert settings, also for free. An advertisement: SHOP FOR SOCKS. GRAB A BITE. PILOT AN AH-64 ATTACK HELICOPTER. After receiving 40,000 visitors and enlisting 236 recruits, the Army decided to shut down this 13-million dollar facility on July of 2010, “It’s been a great success. Basically it’s mission accomplished.”

Though it had planned on opening more of these centers, the Army soon realized there was no longer a need. Thanks to the Mother of All Depressions and rapidly increasing unemployment, desperate Americans are flocking to recruitment stations even without the promise of a free video game. It’s a win, win situation for our military industrial complex: destroy the economy, and Americans will enlist. They will beg to be blown up.

August 5, 2011 Posted by | Deception, Economics, False Flag Terrorism, Militarism | Leave a comment

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