Forget Deir Yassin; Its Victims Were “Unworthy”
By Daniel McGowan / Dissident Voice / April 11th, 2011
Sixty three years ago today Palestinian civilians were massacred at Deir Yassin on the west side of Jerusalem. The terrorists were Jews from The Irgun and the Stern Gang. The village buildings still stand within clear sight of Yad Vashem, the most famous Holocaust memorial.
There is no marker, historical plaque, or even a sign post to commemorate the Deir Yassin massacre, which was the most pivotal event in the Naqba or the 1948-49 dispossession of Palestinians and the beginning of the brutal ethnic cleansing that continues today, largely with American support.
The Holocaust Industry ensures that Jewish victims are worthy of remembering. In countless films, memoirs, novels, articles, museums, memorials, and educational programs Jewish victimhood is recounted over and over again. Professional victims like Elie Wiesel cast and recast the Holocaust narrative so that the world will “never forget” and consequently will ignore the apartheid conditions imposed on over half of the population living within the borders Israel now controls. The irony that Wiesel worked for the terrorist Irgun and steadfastly refuses to apologize for the massacres his employer perpetrated is never exposed in our Israel-centric media.
No comparable organization or dedication exists on the Palestinian side partly because the power of “worthy” victimhood is not recognized and partly out of fear of charges of anti-Semitism and Holocaust denial.
When Sarah Palin put on her Star of David necklace and toured Yad Vashem three weeks ago she pandered to Jewish power and to the memory of “worthy” victims. Had she visited Deir Yassin or even mentioned its name, she would have ended her career in American politics. The same has been true of all obligatory visits by American politicians including Clinton, Giulani, Huckabee, and Romney.
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Daniel McGowan is a Professor Emeritus at Hobart and William Smith Colleges. Because of admonishment by the administration, it is hereby stated that the above remarks are solely those of the author. Hobart and William Smith Colleges neither condone nor condemn these opinions. Furthermore, the author has been instructed to use his personal email address of mcgowandaniel@yahoo.com and not his college email at mcgowan@hws.edu for those wishing to contact him with comments or criticisms.
Showdown in Iceland
Will Iceland Vote No or Commit Financial Suicide
By MICHAEL HUDSON | CounterPunch | April 8, 2011
A landmark fight is occurring this Saturday, April 9. Icelanders will vote on whether to subject their economy to decades of poverty, bankruptcy and emigration of their work force. At least, that is the program supported by the existing Social Democratic-Green coalition government in urging a “Yes” vote on the Icesave bailout. Their financial surrender policy endorses the European Central Bank’s lobbying for the neoliberal deregulation that led to the real estate bubble and debt leveraging, as if it were a success story rather than the road to national debt peonage. The reality was an enormous banking fraud, an orgy of insider dealing as bank managers lent the money to themselves, leaving an empty shell – and then saying that this was all how “free markets” operate. Running into debt was commended as the way to get rich. But the price to Iceland was for housing prices to plunge 70 per cent (in a country where mortgage debtors are personally liable for their negative equity), a falling GDP, rising unemployment, defaults and foreclosures.
To put Saturday’s vote in perspective, it is helpful to see what has occurred in the past year along remarkably similar lines throughout Europe. For starters, the year has seen a new acronym: PIIGS, for Portugal, Ireland, Italy, Greece and Spain.
The eruption started in Greece. One legacy of the colonels’ regime was tax evasion by the rich. This led to budget deficits, and Wall Street banks helped the government conceal its public debt in “free enterprise” junk accounting. German and French creditors then made a fortune jacking up the interest rate that Greece had to pay for its increasing credit risk.
Greece was told to make up the tax shortfall by taxing labor and charging more for public services. This increases the cost of living and doing business, making the economy less competitive. That is the textbook neoliberal response: to turn the economy into a giant set of tollbooths. The idea is to slash government employment, lowering public-sector salaries to lead private-sector wages downward, while sharply cutting back social services and raising the cost of living with tollbooth charges on highways and other basic infrastructure.
The Baltic Tigers had led the way, and should have stood as a warning to the rest of Europe. Latvia set a record in 2008-09 by obeying EU Economics and Currency Commissioner Joaquin Almunia’s dictates and slashing its GDP by over 25 per cent and public-sector wages by 30 per cent. Latvia will not recover even its 2007 pre-crisis GDP peak until 2016 – an entire lost decade spent in financial penance for believing neoliberal promises that its real estate bubble was a success story.
In autumn 2009, Socialist premier George Papandreou promised an EU summit that Greece would not default on its €298bn debt, but warned: “We did not come to power to tear down the social state. Salaried workers will not pay for this situation: we will not proceed with wage freezes or cuts.” But that seems to be what socialist and social democratic parties are for these days: to tighten the screws to a degree that conservative parties cannot get away with. Wage deflation is to go hand in hand with debt deflation and tax increases to shrink the economy.
The EU and IMF program inspired the modern version of Latin America’s “IMF riots” familiar from the 1970s and 80s. Almunia, the butcher of Latvia’s economy, demanded reforms in the form of cutbacks in health care, pensions and public employment, coupled with a proliferation of taxes, fees and tolls from roads to other basic infrastructure.
The word “reform” has been turned into a euphemism for downsizing the public sector and privatization sell-offs to creditors at giveaway prices. In Greece this policy inspired an “I won’t pay” civil disobedience revolt that grew quickly into “a nationwide anti-austerity movement. The movement’s supporters refuse to pay highway tolls. In Athens they ride buses and the metro without tickets to protest against an ’unfair’ 40 per cent increase in fares.” (Kerin Hope, “Greeks adopt ‘won’t pay’ attitude,” Financial Times, March 10, 2011.) The police evidently are sympathetic enough to refrain from fining most protesters.
A Le Monde article accused the EU-IMF plan of riding “roughshod over the most elementary rules of democracy. If this plan is implemented, it will result in a collapse of the economy and of peoples’ incomes without precedent in Europe since the 1930s. Equally glaring is the collusion of markets, central banks and governments to make the people pay the bill for the arbitrary caprice of the system.”
Ireland is the hardest-hit Eurozone economy. Its long-term ruling Fianna Fail party agreed to take bank losses onto the public balance sheet, imposing what looks like decades of austerity – and the largest forced emigration since the Potato Famine of the mid-19th century. Voters responded by throwing the party out of office (it lost two-thirds of its seats in Parliament) when the opposition Fine Gael party promised to renegotiate last November’s $115-billion EU-IMF bailout loan and its accompanying austerity program.
A Financial Times editorial referred to the “rescue” package (a euphemism for financial destruction) as turning the nation into “Europe’s indentured slave.” EU bureaucrats “want Irish taxpayers to throw more money into holes dug by private banks. As part of the rescue, Dublin must run down a pension fund built up when Berlin and Paris were violating the Maastricht rules … so long as senior bondholders are seen as sacrosanct, fire sales of assets carry a risk of even greater losses to be billed to taxpayers.” EU promises to renegotiate the deal augur only token concessions that fail to rescue Ireland from making labor and industry pay for the nation’s reckless bank loans. Ireland’s choice is thus between rejection of or submission to EU demands to “make bankers whole” at the expense of labor and industry. It is reminiscent of when the economist William Nassau Senior (who took over Thomas Malthus’s position at the East India College) was told that a million people had died in Ireland’s potato famine. He remarked succinctly: “It is not enough.” So neoliberal junk economics has a long pedigree.
The result has radically reshaped the idea of national sovereignty and even the basic assumption underlying all political theory: the premise that governments act in the national interest.
The Irish government’s €10 billion interest payments are projected to absorb 80 per cent of the government’s 2010 income tax revenue. This is beyond the ability of any national government or economy to survive. It means that all growth must be paid as tribute to the EU for having bailed out reckless bankers in Germany and other countries that failed to realize the seemingly obvious fact that debts that can’t be paid won’t be. The problem is that during the interim it takes to realize this, economies will be destroyed, assets stripped, capital depleted and labor obliged to emigrate. Latvia is the poster child for this, with a third of its population between 20 and 40 years old already having emigrated or reported to be planning to leave the country within the next few years.
The EU’s nightmare is that voters may wake up in the same way that Argentina finally did when it announced that the neoliberal advice it had taken from U.S. and IMF advisors had destroyed the economy. Debt repayment was impossible. As matters turned out, it had little trouble in imposing a 70 per cent write-down on foreign creditors. Its economy is now booming – because it became credit-worthy again, once it freed itself from its financial albatross!
Much the same occurred in Latin America and other Third World countries after Mexico announced that it could not pay its foreign debts in 1982. A wave of defaults spread – inspiring negotiated debt write-downs in the form of Brady Bonds. U.S. and other creditors calculated what debtors realistically could pay, and replaced the old irresponsible bank loans with new bonds. The United States and IMF members applauded the write-downs as a success story.
But Ireland, Greece and Iceland are now being told horror stories about what might happen if their governments do not commit financial suicide. The fear is that debtors may revolt, leading the Eurozone to break up over demands that financialized economies turn over their entire surplus to creditors for as many years as the eye of forecasters can see, acquiescing to bank demands that they subject themselves to a generation of austerity, shrinkage and emigration.
That is the issue in Iceland’s election this Saturday. It is the issue now facing European voters as a whole: Are today’s economies to be run for the banks, bailing them out of reckless loans at public expense? Or, will the financial system be reined in to serve the economy and raise wage levels instead of imposing austerity.
It seems ironic that the Socialist parties (Spain and Greece), the British Labour Party and various Social Democratic parties have moved to the pro-banker right wing of the political spectrum, committed to imposing anti-labor austerity not only in Europe, but also in New Zealand (the 1990s poster child for Thatcherite privatization) and even Australia. Their policy of downsizing public social services and embrace of privatization is the opposite of their position a century ago. How did they become so decoupled from their original labor constituencies? It seems as if their function is to impose whatever right-wing agenda the Conservative parties cannot get away with – not unlike Obama neutering possible Democratic Party alternatives to Republican lobbying for more Rubinomics.
Is it simply gullibility? That may have been the case in Russia, whose leaders seemed to have little idea of how to fend off destructive advice from the Harvard Boys and Jeffrey Sachs. But something more deliberate plagues Britain’s own Labour Party in out-Thatchering the Conservatives in privatizing the railroads and other key economic infrastructure with their Public-Private Partnership. It is the attitude that led Gordon Brown to threaten to blackball Icelandic membership in the EU if its voters oppose bailing out the failure of Britain’s own neoliberal bank insurance agency to prevent banksters from emptying out Icesave. Last weekend half a million British citizens marched in London to protest the threatened cutbacks in social services, education and transportation, and tax increases to pay for Gordon Brown’s bailout of Northern Rock and the Royal Bank of Scotland. The burden is to fall on labor and industry, not Britain’s financial class. The Daily Express, a traditionally campaigning national paper, is now running a full throttle campaign for Britain to leave the EU, on much the same ground that Britain has long rejected joining the euro.
What is the rationale of Iceland and other debtor countries paying, especially at this time? The proposed agreements would give Britain and Holland more than EU directives would. Iceland has a strong legal case. Social Democratic warnings about the EU seem so overblown that one wonders whether the Althing members are simply hoping to avoid an investigation as to what actually happened to Landsbanki’s Icesave deposits. Britain’s Serious Fraud Office recently became more serious in investigating what happened to the money, and has begun to arrest former directors. So this is a strange time indeed for Iceland’s government to agree to take bad bank debts onto its own balance sheet.
The problem is that the more Iceland’s economy shrinks, the more impossible it becomes to pay foreign debts. Iceland’s government is desperately begging to join Europe without asking just what the cost will be. It would plunge the krona’s exchange rate, shrink the economy, drive young workers to emigrate to find jobs and to avoid the bankruptcy foreclosures that would result from subjecting the nation to austerity.
Nobody really knows just how deep the hole is. Iceland’s government has not made a serious attempt to make a risk analysis. What is clear is that the EU and IMF have been irresponsibly optimistic. Each new statistical report is “surprising” and “unexpected.” On the basis of the IMF’s working assumption about the króna’s exchange rate at end-2009, for example, the IMF staff projected that gross external debt would be 160 per cent of GDP. To be sure, they added that a further depreciation of the exchange rate of 30 percent would cause a precipitous rise in the debt ratio. This indeed has occurred. Back in November 2008, the IMF warned that the foreign debt it projected by year end 2009 might reach 240 per cent of GDP, a level it called “clearly unsustainable.” But today’s debt level has been estimated to stand at 260 per cent of Icelandic GDP – even without including the government-sponsored Icesave debt and some other debt categories.
Creditors lose nothing by providing junk-economic advice. They have shown themselves quite willing to encourage economies to destroy themselves in the process of trying to pay – something like applauding nuclear power plant workers for walking into radiation to help put out a fire. For Ireland, the EU pressed the government to take responsibility for bank loans that turned out to be only about 30 per cent (not a misprint!) of estimated market price. It said that this could “easily” be done. Ireland’s government agreed, at the cost of condemning the economy to two or more decades of poverty, emigration and bankruptcy.
What makes the problem worse is that foreign-currency debt is not paid out of GDP (whose transactions are in domestic currency), but out of net export earnings – plus whatever the government can be persuaded to sell off to private buyers. For Iceland, the question would become one of how many of its products and services – and natural resources and companies – Britain and the Netherlands would buy.
It is supposed to be the creditor’s responsibility to work with debtors and negotiate payment in exports. Instead of doing this, today’s creditors simply demand that governments sell off their land, mineral resources, basic infrastructure and natural monopolies to pay foreign creditors. These assets are forfeited in what is, in effect, a pre-bankruptcy proceeding. The new buyers then turn the economy into a set of tollbooths by raising access fees to transportation, phone service and other privatized sectors.
One would think that the normal response of a government in this kind of foreign debt negotiation would be to appoint a Group of Experts to lay out the economy’s position so as to evaluate the ability to pay foreign debts – and to structure the deal around the ability to pay. But there has been no risk assessment. The Althing has simply accepted the demands of the UK and Holland without any negotiation. It has not even protested the fact that Britain and Holland are still running up the interest clock on the charges they are demanding.
Why doesn’t Iceland’s population say to Europe’s financial negotiators: “Nice try! But we’re not falling for it. Your creditor game is over! No nation can be expected to keep committing financial suicide Ireland-style, imposing economic depression and forcing a large portion of the labor force to emigrate, simply to pay bank depositors for the crimes or negligence of bankers.”
The credit rating agencies have tried to reinforce the Althing’s attempt to panic the population into a “Yes” vote. On February 23, Moody’s threatened: “If the agreement is rejected, we would likely downgrade Iceland’s ratings to Ba1 or below.” If voters approve the agreement, however, “we would likely change the outlook on the government’s current Baa3 ratings to stable from negative,” in view of a likely “cut-off in the remaining US$1.1 billion committed by the other Nordic countries and probably also to delays in Iceland’s IMF program.”
Perhaps not many Icelanders realize that credit ratings agencies are, in effect, lobbyists for their clients, the financial sector. One would think that they had utterly lost their reputation for honesty – not to mention competence – by pasting AAA ratings on junk mortgages as prime enablers of the present global financial crash. The explanation is, they did it all for money. They are no more honest than was Arthur Andersen in approving Enron’s junk accounting.
My own view of ratings agencies is based in no small part on the story that Dennis Kucinich told me about the time when he was mayor of Cleveland, Ohio. The banks and some of their leading clients had set their eyes on privatizing the city’s publicly owned electric company. The privatizers wanted buy it on credit (with the tax-deductible interest charges depriving the government of collecting income tax on their takings), and sharply raise prices to pay for exorbitant executive salaries, outrageous underwriting fees to the banks, stock options for the big raiders, heavy interest charges to the banks and a nice free lunch to the ratings agencies. The banks asked Mayor Kucinich to sell them the bank, promising to help him be governor if he would sell out his constituency.
Kucinich said “No.” So the banks brought in their bullyboys, the ratings agencies. They threatened to downgrade Cleveland’s rating, so that it could not roll over the loan balances that it ran as a normal course with the banks. “Let us take your power company or we will wreck your city’s finances,” they said in effect.
Kucinich again said no. The banks carried out their threat – but the mayor had saved the city from having its incomes squeezed by predatory privatization charges. In due course its voters sent Kucinich to Congress, where he subsequently became a presidential candidate.
So, returning to the problem of the credit rating agencies, how can anyone believe that agreeing to pay an unpayably high debt would improve Iceland’s credit rating? Investors have learned to depend on their own common sense since losing hundreds of billions of dollars on the ratings agencies’ reckless estimates. The agencies managed to avoid criminal prosecution by noting that the small print of their contracts said that they were only providing an “opinion,” not a realistic analysis for which they could be expected to take any honest professional responsibility!
Argentina’s experience should provide the model for how writing off a significant portion of foreign debt makes the economy more creditworthy, not less. And as far as possible lawsuits are concerned, it is a central assumption of international law that no sovereign country should be forced to commit economic suicide by imposing financial austerity to the point of forcing emigration and demographic shrinkage. Nations are sovereign entities.
It thus would be legally as well as morally wrong for Iceland’s citizens to spend the rest of their lives paying off debts owed for money that should rather be an issue between Britain’s Serious Fraud Office and the British bank insurance agencies. Overarching the vote is how high a price Iceland is willing to pay to join the EU. In fact, as the Eurozone faces a crisis from the PIIGS debtors, what kind of EU is going to emerge from today’s conflict between creditors and debtors. Fears have been growing that the euro-zone may break up in any case. So Iceland’s Social Democratic government may be trying to join an illusion – one that now seems to be breaking up, at least as far as its neoliberal extremism is concerned. Just yesterday (Thursday, April 7) a Financial Times editorial commented on what it deemed to be Portugal’s premature cave-in to EU demands:
“Another eurozone country has been humbled by its banks. Earlier this week, Portugal’s banks were threatening a bond-buyers’ go-slow unless the caretaker government sought financial help from other European Union countries. … Lisbon should have stuck to its position. … it should still resist doing what the banks demanded: seeking an immediate bridging loan. … By jumping the gun, the government risks having scared markets away entirely. That may prejudice the outcome of negotiations about the longer-term facility.
“The caretaker government has neither the moral nor the political authority to determine Portugal’s future in this way. It should not precipitately abandon the markets. That may mean paying high yields on debt issues in coming months – higher than they might have been had the government not folded its hand too soon. … The right time to opt for an external rescue would have been at the end of a national debate.”
The same should be true for Iceland. Looking over the past year, it seems that the island nation has been used as a target for a psychological and political experiment – a cruel one – to see how much a population will be willing to pay that it does not really owe for what bank insiders have stolen or lent to themselves.
Iceland’s government seems to have become decoupled from what is good for voters and for the very survival of Iceland’s economy. It thus challenges the assumption that underlies all social science and economics: that nations will act in their own self-interest. This is the assumption that underlies democracy: that voters will realize their self-interest and elect representatives to apply such policies. For the political scientist this is an anomaly. How does one explain why a national parliament is acting on behalf of Britain and the Dutch as creditors, rather than in the interest of their own country accused of owing debts that voters in other countries have removed their governments for agreeing to?
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Michael Hudson is a former Wall Street economist. A Distinguished Research Professor at University of Missouri, Kansas City (UMKC), he is the author of many books, including Super Imperialism: The Economic Strategy of American Empire (new ed., Pluto Press, 2002) and Trade, Development and Foreign Debt: A History of Theories of Polarization v. Convergence in the World Economy. He can be reached at mh@michael-hudson.com
American rich keep getting richer
Press TV – April 5, 2011
A group of 25 hedge fund executives in 2010 managed to earn a combined $22.1 billion — an amount equivalent to 441,400 American households each making $50,000 a year (roughly the current average).
This is one more example that the gap between the super-wealthy in the United States and the rest of Americans is growing wider and wider.
Considering that the median household size is 2.6 persons, that means that these 25 took home as much as the average of 1,150,000 Americans combined. That is bigger than the population of Dallas…or Rhode Island.
HIGHLIGHTS
Ten years ago, the same 25 Wall Street barons would have taken home a total of $5 billion. Now, a single hedge fund chief, John Paulson, was able to make that much ($4.9 billion) in 2010. Allgov
Paulson made billions during the worst of the financial downturn because he bet that the mortgage bubble would burst. Most of his profits in 2010 came from investing in gold, buying and selling stock in Citigroup…and collecting an estimated $1 billion in management fees. Allgov
“So many of these guys are killing it on the management fees,” said Bradley H. Alford, chief investment officer of Alpha Capital Management, which invests in hedge funds. “You can’t feel good giving 30 percent of your returns to some guy who was up single digits. That has to give you indigestion.” NY Times
FACTS & FIGURES
The hedge fund industry as a whole did not do better than the stock market last year, the HedgeFund Intelligence Global Composite Index, which tracks nearly 4,000 hedge funds around the world, had a median gain of 8 percent in 2010, trailing the 11.7 percent rise in the MSCI World Index of stocks and the 12.7 percent rise in the Standard & Poor’s 500-stock index. NY Times
The upper 1 percent of Americans are now taking in nearly a quarter of the nation’s income every year in terms of wealth rather than income, the top 1 percent control 40 percent. Investorshub
Twenty-five years ago, the corresponding figures were 12 percent and 33 percent. Investorshub
While the top 1 percent have seen their incomes increased by 18 percent over the past decade, those in the middle have actually seen their incomes fall. Investorshub
All the growth in recent decades-and more-has gone to those at the top. Investorshub
Cutting Social Security: Policy Without a Purpose
By DEAN BAKER | CounterPunch | April 1, 2011
The accepted wisdom in Washington policy circles is that we have to cut Social Security if we are serious about dealing with the deficit. Before anyone rushes to shave the benefits of retirees it might be worth asking why.
By now, just about everyone has seen the charts touted by the deficit hawks showing that the cost of Social Security, Medicare, and Medicaid is projected to go through the roof in the decades ahead, while the cost of everything else is more or less under control. This looks very ominous. The neat trick is that if Social Security is pulled out from the category with Medicare and Medicaid, and instead placed in the category with everything else, the chart looks almost exactly the same.
The real story is that the cost of Medicare and Medicaid are projected to go through the roof because the cost of health care is projected to go through the roof. We can put in any program – veterans benefits, Head Start, foreign aid – together with Medicare and Medicaid and show the cost of these three programs together going through the roof.
Lumping in Social Security with Medicare and Medicaid conceals the reality that the real long-term budget problem is a health care cost problem. The United States already pays more than twice as much per person for its health care as other wealthy countries. It gets little obvious benefit for this additional expense. Per person health care costs in the United States are projected to rise even further relative to both GDP and costs in other countries.
If these cost projections prove accurate, then it will have a devastating impact on the U.S. economy. Part of this story will be the huge deficits touted by the budget hawks since more than half of national health care spending is paid through the public sector. However this trajectory for health care costs will also have a devastating impact on the private sector as well. The cost of health care for workers was one of the big factors in the bankruptcy of General Motors and Chrysler two years ago. If health care costs continue to soar, then the burden it imposes on employers and workers will rise correspondingly.
No one disputes these facts. The basic arithmetic would seem to demand an all out effort to control health care costs; why does Social Security get dragged into the picture?
It’s hard to argue that Social Security benefits are too generous, or that retirees enjoy extravagant lifestyles. The average Social Security benefit is just over $1,100 a month. The median income for a household headed by someone over the age of 65 in 2009 was $31,400. And the vast majority of Social Security benefits go to those who need them most. More than 75 percent of benefits go to individuals with non-Social Security income of less than $20,000 a year and more than 90 percent of benefits go to individuals with non-Social Security income of less than $40,000 a year.
Moreover, benefits in the United States are relatively stingy by international standards. We have already raised the age to receive full benefits to 66 with a further rise to 67 scheduled in the next decade. The private pension system has largely collapsed and the current group of near retirees saw much of their home equity disappear with the collapse of the housing bubble. As a result the situation of retirees is likely to be worse in the near future, especially after taking into account the growing burden of out-of-pocket health care expenses projected in the decades ahead.
This is the reality for the overwhelming majority of retired workers. The story told by the deficit hawks of the affluent elderly banking their big Social Security checks is a complete fabrication. It would make little difference in the program’s financing if we could zero out the benefits to the genuinely wealthy among the elderly. In fact, the cost of administering some sort of means test would likely exceed the potential savings, unless the purpose of the means test was to hit people that would fit anyone’s definition of middle class.
It is also worth remembering that the program pays for itself now and is projected to do so for the next 26 years. While it does face a projected shortfall in later years in the century, the deficit over the program’s 75-year planning horizon is still just 0.6 percent of GDP. This is approximately one-third of the increase in annual defense spending between 2000 and the present. Unless the intention is to use tax dollars raised through a designated Social Security tax, which is very regressive, for other purposes, this is the limit of the potential savings from Social Security cuts.
The undisputed facts around Social Security make the drive to cut benefits look like a policy without a purpose. Unfortunately, swearing support for such cuts now appears to be the price of admission to serious policy debates in Washington.
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Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of Plunder and Blunder: The Rise and Fall of the Bubble Economy and False Profits: Recoverying From the Bubble Economy.
Libya, Egypt and Tunisia as seen from New Jersey
Why not set them at war with each other?
Michael Walzer | Dissent | March 7, 2011
… The point of calling in an army would be to overthrow the dictator and help move Libya toward a democratic transformation. And that is just the kind of intervention that [John Stuart] Mill opposed and that international law rules out….
What if it looks as if Qaddafi is going to win? Would we be willing to go all the way with Mill and say that if the rebels lose, it’s because the country isn’t ready, isn’t “fit,” for democratic government? I don’t think I am tough enough for that. But if there is to be, somewhere down the road, a military intervention, let it not be an American intervention. Ideally, I suppose, it should be an Italian intervention. According to post-colonial theory, the Italians are responsible for everything bad that has happened in Libya since they left. But if they tried to fix things, it wouldn’t be a post-post-colonial effort; it would look very much like the old colonialism. In any case, they could act effectively only as part of a NATO force, and NATO is second-worst to the United States as a potential intervener. United Nations auspices would provide a little cover, but it would almost certainly be vetoed in the Security Council. So why not call in the Egyptian and Tunisian armies? A high-tech force isn’t necessary here; with logistical help, these two armies could do the job. And who knows? Promoting democracy in Libya might push them to do the same thing, a bit more eagerly than they are doing now, in their own countries.
When intervention is necessary, neighbors are the best substitute for insiders. But when does “necessity” kick in—when the rebels have been utterly defeated, or when they are on the brink of defeat, or when too many of them are being killed? I would like to say, we will know necessity when we see it—except that so many people see it too soon, and so many never see it. We should begin that argument right now.
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Michael Walzer is co-editor of Dissent. A professor emeritus at Princeton University in New Jersey, he is the author of many articles and books–including Just and Unjust Wars, Spheres of Justice, and On Toleration. He is also a contributing editor to the New Republic.
‘UK government wants Muslims out of London’
Press TV – March 17, 2011
An opposition Labour Party minister has accused the British government of spearheading efforts to force Muslim families out of central London.
KarenBuck, the shadow Work and Pensions Minister, told a public meeting in Islington that the government “does not want Muslims living in central London,” adding that ministers were “deeply hostile” to poor people having children, British media reported.
Buck also spoke of the government’s spending cuts program, saying that planned cuts to housing benefits were politically motivated to force poor, ethnic minority and Muslim families out of the center of London.
“They [The Government] do not want lower-income women, families, children and, above all, let us be very clear – because we also know where the impact is hitting – they don’t want black women, they don’t want ethnic minority women and they don’t want Muslim women living in central London. They just don’t. They want people to be moving out of anywhere that is a more prosperous area into the fringes of London and into places like Barking and Newham. I have nothing against Barking and Newham. The problem is they are already full of people who are quite poor,” she said.
The shadow minister also accused the Tories of thinking that families who earn less than £40,000 a year should not have any children.
“The Government is one that is deeply hostile to middle- and lower-income women having children,” she said.
“When you listen to the Tories speaking in Parliament, there is an arrogance and an ignorance that I have never known in my 13 years in Parliament: basically, thinking that anyone whose income is below the top rate of tax shouldn’t have children,” added Buck.
The Conservative Party Chairman Baroness Warsi reacted to the remarks, saying that “they were deeply offensive.”
Warsi, herself a Muslim, called on Labour Party chief Ed Miliband to remove Buck from Labour’s frontbench.
This is while government plans, which come into force next month — housing benefit will be capped at £400 a week for the largest homes and £290 a week for two-bed flats — are continuously raising concerns that many poor families will no longer be able to afford the rent in inner cities.
A report for the Cambridge Centre for Housing and Planning Research suggested that – nationwide – up to 269,000 households will struggle to pay their rent, with an estimated half of these expected to lose their homes.
The plans will hit particularly hard in London, where average rents are higher than they are in any part of the country. London Councils estimate that 82,000 households across the capital will be at risk of losing their homes under the government changes.
Stealing from Social Security to Pay for Wars and Bailouts
Instead of investing our Social Security payroll deductions the US government wasted them on blowing up infrastructure and people in foreign lands
By Dr. Paul Craig Roberts | Global Research | March 9, 2011
… Republicans tell us that our grandchildren are being saddled with impossible debt burdens because of handouts to retirees and the poor. $3 trillion wars are necessary and have nothing to do with the growth of the public debt. The public debt is due to unnecessary “welfare” that workers paid for with a 15% payroll tax.
When you hear a Republican sneer “entitlement,” he or she is referring to Social Security and Medicare, for which people have paid 15% of their wages for their working lifetime. But when a Republican sneers, he or she is saying “welfare.” To the distorted mind of a Republican, Social Security and Medicare are undeserved welfare payments to people who over-consumed for a lifetime and did not save for their old age needs.
America can be strong again once we get rid of these welfare leeches.
Once we are rid of these leeches, we can really fight wars. And show people who is boss.
Republicans regard Social Security as an “unfunded liability,” that is, a giveaway that is
interfering with our war-making ability.
Alas, Social Security is an unfunded liability, because all the money working people put into it was stolen by Republicans and Democrats in order to pay for wars and bailouts for mega-rich bankers like Goldman Sachs.
What I am about to tell you might come as a shock, but it is the absolute truth, which you can verify for yourself by going online to the government’s annual OASDI and HI reports. According to the official 2010 Social Security reports, between 1984 and 2009 the American people contributed $2 trillion, that is $2,000 billion, more to Social Security and Medicare in payroll taxes than was paid out in benefits.
What happened to the surplus $2,000 billion, or $2,000,000,000,000.
The government spent it.
Over the past quarter century, $2 trillion in Social Security and Medicare revenues have been used to finance wars and pork-barrel projects of the US government.
Depending on assumptions about population growth, income growth and other factors, Social Security continues to be in the black until after 2025 or 2035 under the “high cost” and “intermediate” assumptions and the current payroll tax rate of 15.3% based on the revenues paid in and the interest on those surplus revenues. Under the low cost scenario, Social Security (OASDI) will have produced surplus revenues of $31.6 trillion by 2085. […]
The subsidy to the US government from the payroll tax is larger than the $2 trillion in excess revenue collections over payouts. The subsidy of the Social Security payroll tax to the government also includes the fact that $2.8 trillion of US government debt obligations are not in the market. If the national debt held by the public were $2.8 trillion larger, so would be the debt service costs and most likely also the interest rate.
The money left over for war would be even smaller. More would have to be borrowed or printed.
The difference between the $2 trillion in excess Social Security revenues and the $2.8 trillion figure is the $0.8 trillion that is the accumulated interest over the years on the mounting $2 trillion in debt, if the Treasury had had to issue bonds, instead of non-marketable IOUs, to the Social Security Trust Fund. When the budget is in deficit, the Treasury pays interest by issuing new bonds in the amount of the interest due. In other words, the interest on the debt adds to the debt outstanding.
The robbed Social Security Trust Fund can only be made good by the US Treasury issuing another $2.8 trillion in US government debt to pay off its IOUs to the fund.
When a government is faced with a $14 trillion public debt growing by trillion dollar deficits as far as the eye can see, how does it add another $2.8 trillion to the mix?
Only with great difficulty.
Therefore, to avoid repaying the $2.8 trillion that the government has stolen for its wars and bailouts for mega-rich bankers, the right-wing has selected entitlements as the sacrificial lamb.
A government that runs a deficit too large to finance by borrowing will print money as long as it can. When the printing press begins to push up inflation and push down the exchange value of the dollar, the government will be tempted to reduce its debt by reneging on entitlements or by confiscating private assets such as pension funds. When it has confiscated private assets and reneged on public obligations, nothing is left but the printing press.
We owe the end-time situation that we face to open-ended wars and to an unregulated financial system concentrated in a few hands that produces financial crises by leveraging debt to irresponsible levels.
The government of the United States does not represent the American people. It represents the oligarchs. The way campaign finance and elections are structured, the American people cannot take back their government by voting. A once proud and free people have been reduced to serfdom.
Is entertaining dictators worse than normalizing apartheid?
Nada Elia and Laurie King, The Electronic Intifada, 3 March 2011
As revolutions continue to sweep the Arab world, and the days of dictators seem numbered, we are learning a lot about the ties and alliances that have long characterized the west’s dealing with tyrants around the globe. “Stability,” apparently, requires us to make deals with the devil. And so we discover that the United States has long known about the human rights abuses of deposed Egyptian president Hosni Mubarak, deposed Tunisian president Zine el-Abedine Ben Ali, and Libyan leader Muammar Gaddafi. But it was willing nonetheless not only to turn a blind eye to these, but even to enable and fund, directly or indirectly, oppressive regimes, for the sake of what exactly? Oil? Corporations? The so-called “peace process?” Iraqi “freedom?” Israel’s security?
And as Arab tyrants are challenged, one by one, social media are abuzz with the embarrassing and numerous compliments and kind remarks that western heads of state, academics, pundits, and entertainers have given these deposed dictators. In a typical statement, US Secretary of State Hillary Clinton, for example, said in 2009: “I really consider President and Mrs. Mubarak to be friends of my family.” Apparently, the Clinton-Mubarak friendship goes back about 20 years. Gaddafi’s son Saif al-Islam, a close friend of Prince Andrew, Queen Elizabeth’s second son and fourth in line to the British throne, has been a guest at Windsor Castle and Buckingham palace. The list is long.
But as the people seem determined to overthrow all those oppressive regimes, liberal Americans are openly questioning the wisdom and morality of “dealing with the devil.” In a highly critical segment on Anderson Cooper’s program AC 360, Cooper, a CNN journalist exhibiting an unusual level of courage and integrity among mainstream American media personalities, called out the various US presidents who have welcomed Gaddafi into their diplomatic circles, even as they acknowledged his tendency towards malice and mental instability, best epitomized by Ronald Reagan’s name for him: “the madman of the desert” (KTH: The West and Gadhafi’s regime,” 24 February 2011).
In that same episode, Cooper was critical of American artists Beyonce, Usher, and Mariah Carey, all three of whom gave private performances for the Gaddafis. Carey apparently received one million dollars for performing four songs for the Gaddafis on New Year in 2009. The following year, it was Beyonce and Usher who graced the Libyan dictator’s New Year’s celebration. Cooper asked why artists would perform for tyrants, and suggested that they donate the money they received to the Libyan people.
The news item was quickly picked up by other media. Rolling Stone magazine also ran an article stating that the music industry is lashing out at these artists, and quoting David T. Viecelli, agent for Arcade Fire and many other acts, as saying “Given what we know about Qaddafi and what his rule has been about, you have to willfully turn a blind eye in order to accept that money, and I don’t think it’s ethical” (Industry Lashes Out at Mariah, Beyonce and Others Who Played for Qaddafi’s Family,” 25 February 2011).
Amid all this uproar, Canadian singer Nelly Furtado announced on Twitter that she would donate to charity a one million dollar fee she received to perform for the Gaddafi family in 2007 (“Nelly Furtado to give away $1 million Gaddafi fee,” Reuters, 1 March 2011).
Those of us who have long been engaged in Palestine justice activism cannot help but notice glaring double-standards in these denunciations of the various deals with devils. And at this critical point in the history of the Arab world, we must request that our readers begin to “connect the dots” throughout the region. Is entertaining dictators a lesser crime than normalizing Israeli apartheid?
Why hold artists accountable for performing at the behest of tyrants, and let them off the hook for whitewashing Israel’s regime which engages in massive human rights abuses, all subsidized by the United States government?
Why not call out Beyonce, Usher, Mariah Carey, and so many other artists, all of whom have performed in Israel, a state which practices a form of apartheid worse than anything the South African apartheid government had ever done? In 1973, the United Nations General Assembly defined the crime of Apartheid as “inhuman acts committed for the purpose of establishing and maintaining domination by one racial group of persons over any other racial group of persons and systematically oppressing them.” As Israel’s official policy privileges Jewish nationals over non-Jewish citizens, creating de facto and de jure discrimination against the indigenous Palestinian people, it is hard to dispute that this supposed “democracy” is in reality an apartheid state.
Many of the discriminatory measures Israel practices today were unthought of in apartheid South Africa. In his powerful essay, “Apartheid in the Holy Land,” penned shortly after his return from a visit to the West Bank, Archbishop Desmond Tutu wrote: “I’ve been very deeply distressed in my visit to the Holy Land; it reminded me so much of what happened to us black people in South Africa” (“Apartheid in the Holy Land,” The Guardian, 29 April 2002).
In 2009, a comprehensive study by South Africa’s Human Sciences Research Council confirmed that Israel is practicing both colonialism and apartheid in the occupied Palestinian territories.
That study was inspired by the observations of John Dugard, South African law professor and former UN special rapporteur on human rights in the occupied Palestinian territories, who wrote in 2006: “Israel’s large-scale destruction of Palestinian homes, leveling of agricultural lands, military incursions and targeted assassination of Palestinians far exceeded any similar practices in apartheid South Africa. No wall was ever built to separate blacks and whites.” And no roads were ever built for whites only in South Africa either, while Israel continues to build Jewish-only roads, cutting through the Palestinian landscape.
Israel’s form of apartheid includes the crippling blockade of Gaza; the ongoing seizure of Palestinian land and water sources; construction of the West Bank apartheid wall declared illegal by the International Court of Justice in The Hague; the ongoing ethnic cleansing of Jerusalem; the denial of the rights of Palestinian refugees and discriminatory laws and mounting threats of expulsion against the 1.2 million Palestinians who hold Israeli citizenship.
And as word inevitably gets out, because we are no longer pleading for permission to narrate, but seizing our right to expose these crimes, Israel is hard at work trying to fix its image, without changing the policies and actions that have tarnished that image. As it cements its apartheid policies, Israel is funneling millions of dollars into burnishing its public image as a culturally vibrant, progressive, and thriving democracy.
Among its PR moves is the cultural “Re-Brand” campaign. Israel is intentionally inviting international artists to such “hip” places as Tel Aviv to mask the ugly face of occupation, apartheid, displacement, and dispossession. If we are to hold artists accountable for their choice of performance venues and income sources — as indeed we should — then we should hold them accountable for complicity in normalizing apartheid no less than for entertaining dictators.
In an important article that appeared in The Grio, Lori Adelman also asks: “Why are black pop stars performing at the behest of dictators?” before making the comparison to Sun City, the extravagant whites-only entertainment resort city in apartheid South Africa. And she reminds her readers of the impact of the Artists United Against Apartheid music project, which contributed one million dollars for anti-Apartheid efforts and, most importantly, raised awareness about the global power of artists to influence political discourse on human rights issues (“Why are black pop stars performing at the behest of dictators?,” 24 February 2011).
Today, there is global awareness of Israel’s numerous crimes. And there is a call for artists to boycott Israel, until the country abides by international law. The call was issued in 2005 by the Palestinian Campaign for the Academic and Cultural Boycott of Israel (www.pacbi.org/). In the US, where we live, the campaign is coordinated by the US Campaign for the Academic and Cultural Boycott of Israel. When we learn of an artist who is planning to perform in Tel Aviv, we contact them, inform them of the reality on the ground (should they need such information), and urge them to reconsider and cancel any concerts they may have scheduled. Many have already done so, including the industry’s biggest names: Carlos Santana, Bono, The Pixies, Elvis Costello and Gil Scott-Heron. Folk legend Pete Seeger also recently announced his support for boycotting Israel.
In what may be the most eloquent statement to date, Costello wrote: “One lives in hope that music is more than mere noise, filling up idle time, whether intending to elate or lament. Then there are occasions when merely having your name added to a concert schedule may be interpreted as a political act that resonates more than anything that might be sung and it may be assumed that one has no mind for the suffering of the innocent. … Some will regard all of this an unknowable without personal experience but if these subjects are actually too grave and complex to be addressed in a concert, then it is also quite impossible to simply look the other way” (“It Is After Considerable Contemplation …,” 15 May 2010).
Today, Artists Against Apartheid are still around, and they are active in promoting the boycott of a country that is practicing apartheid in the 21st century, namely Israel. The question should be, then, if artists boycotted Sun City, shouldn’t they also boycott Tel Aviv? Why the outrage when Beyonce entertains Gaddafi, but not when Madonna, Lady Gaga, Rihanna, and so many more, entertain apartheid in Israel?
~
Laurie King, an anthropologist, is co-founder of The Electronic Intifada.
Nada Elia is a member of the Organizing Committee of USACBI, the US Campaign for the Academic and Cultural Boycott of Israel (Facebook).
Egyptian Revolution in Israeli Eyes
By Seraj Assi | Palestine Chronicle | February 14, 2011
The Arab World is suffering and in its suffering it threatens Israel. ‘Israeli citizens are frightened,’ said Israeli opposition leader Tzipi Livni in a moment of deep confession. In fact, what Livni was saying, to paraphrase Franz Fanon, is this: “Mama America, see the Arab! I’m frightened! Frightened! Frightened!”
This is a typical colonial scene where the “frightening victims” are captured in a game that involves dehumanization and empowering and rendered silent and dangerous subjects at the same time. Never can they escape this colonial capacity to invite and contain contradictions and opposites.
Yet in the Israeli case the irony is far more acute. For not only does Israel see its victim as dangerous and potentially evil, but has itself become the victim. It is within this irony that the ritual of victimization came to dominate the master narrative of Israel’s colonial discourse and foreign policy. Not only has Israel become a country whose entire existence is dependent on the suppression of all Arab and Muslim peoples, but it has relentlessly contributed to their suppression.
According to Israel’s imperial logic, it is only reasonable to suppress the lives of three hundred million people for the “security” of a few million Israeli Jews, no matter how fictitious this security claim is. The irony is while Israel continues to bill Egyptian revolution as a threat to its national security, its Palestinian citizens- for decades Israel’s internal “dangerous victims”- are taking to the streets to celebrate the victory of their Egyptian brothers. Motivated by human and national solidarity, they have never felt as secure as they do now.
Israel’s security is fundamentally the security of vision. And since the vision of Arab and Muslim despotism is the only guarantee for Israel’s cultural narcissism and ethnic superiority in the region, it must be preserved by any means, and precisely by brutal force for “Arabs only understand force”, as Zionists believe.
Yet Israel’s fear has a performative colonial function. Its obsessive insistence to remain “the only democracy in the Middle East” is not merely a representational fantasy, but an effective colonial strategy. It is precisely this vision that gives Israel’s colonial policies in the region its moral justification and authentic validity. Its “civilizing mission” in the region is completely dependent on its vision of Arab and Muslim undemocratic spirit.
It is Israel’s cultivated vision on Arab despotism that permits its former Prime Minister Ehud Barak to boast that “Israel is a villa in a jungle” and its President Shimon Perez to contrast democracy with peace: “Mubarak is a great man committed to peace, but Egyptian youth want democracy.” And when Israeli Prime Minister Benjamin Netanyahu issued his paternalistic warning to Egypt from “becoming another Iran” he was operating into the same imperial logic.
Here Israel’s ambition to reorder the world by the brutal force of Zionist propaganda reaches its extreme absurdity. Indeed, it is in Israel where suppression is equivalent to stability. It is there where Egypt, its people, history and culture are all reduced to one word: Camp David. And it is in Israel where international sympathy for Egyptian struggle for freedom and dignity is violently placed under what an Israeli journalist has recently called “the betrayal of the West.”
Even when the moment has arrived to contradict these proclamations, Israel continues to see itself as the civilization custodian surrounded by uncivilized enemies and unruly protestors. There is no doubt then that Israel’s fear of any prospective democracy in the Arab world is steeped in racism. For Arab democracy simply threatens Israel’s undisputed vision of Arabs that maintained itself regardless of any historical evidence disputing it. And since the evidence this time is too visible to be denied, it becomes too intimidating for the Israeli observer. As the vision is now defeated by the narrative, as it is yielding to the pressure of history, Israel’s fear turns into collective phobia and racist hysteria. The scene of an Arab getting out of the iron cage fashioned by the Israeli observer to violate the serenity of history is precisely what frightens Israel.
On February 02, 2011, an article published in Haaretz opened with the following:
“Edward Said was right. We are all infected with Orientalism, not to mention racism. For the site of an entire people shaking off the yoke of tyranny and bravely demanding free elections – instead of uplifting our spirits, fills us with fear, just because they are Arabs.”
This clearly illustrates how, by a strange change of fortune, Israel came to inherit Western Orientalist racism and produce its own “Orientals”. Indeed, it is in Israel where, to steal a line from Naomi Klein, “Jews made the shift from victims to victimizers with terrifying ease.” This ironic legacy of Western Orientalism now produced by the Zionist racist machinery is precisely what enables Binyamin Fuad Ben-Eliezer, himself an Arab Jew born in Basra in Iraq, to lament Mubarak’s departure by claiming that “Arabs are not ready for democracy.”
Yet Israeli Jews are not alone to inherit the ironic legacy of Western Orientalism in the region. Just a week after the Egyptian revolution broke up Mubarak too introduced his version of Orientalism. Not so different from Livni’s was his message to President Obama on ABC that “you don’t understand Egyptian culture and what would happen if I step down now”. One might wonder what was left of Egyptian culture under Mubarak regime but a bunch of corrupt muftis and semi-intellectuals. In fact, one does not need a revolution to discover that Mubarak is the last one in Egypt to understand what Egyptian culture is.
Perhaps the most hilarious scene of Mubarak’s Orientalist doctrine was his “camelization” of the demonstrations in Egypt. By unleashing his thugs riding in on camels and horses to crush and terrorize peaceful civilian protestors on the streets Mubarak was sending a clear message to his friends in the West. That is Egyptians, when left to their devices, are nothing but a bunch of unruly savages unsuited to democracy and civilization. His barbaric response to one of the most civilized revolutions in the region shows how deeply he believes in what he says and does.
Mubarak’s response is an extraordinary example of how local dictators act as colonial agents towards their people and how they too feed on the irony of “dangerous victims.” Victimization in Mubarak’s version depends on the same logic of radical inversion. That is by presenting Egyptian protestors as collaborators and foreign agents Mubarak is following the Arab proverb: “He hit me and cried, he raced me to complain.” Yet Mubarak certainly knows, as well as his Israeli and Western interlocutors, that one of the motivations behind the revolution was precisely his scandalous collaborative role in the region.
It is in this context that the revolution against Mubarak regime becomes an anti-colonial struggle. His dehumanization of his people tied with his brutal violence against peaceful civilians is an unmistakably colonial symptom. Here the recent events in Tunisia and Egypt should not make us forget how Western violence was exported to the Arab world from the dawn of colonialism up to the present day, how it was brought home by ruling elites whose links to neo-colonial and post-colonial metropolises are maintained through multiple forms of agency, and how authoritarian Arab regimes continue to feed on Western hypocrisy in regard to democracy and liberty, the same slogans that have provided the foot-hold for Western expansion in the region.
Nor should we forget that Western political stability in comparison to the Arab world should be interpreted against the background of its exploitation of the region which provided it with the wealth to support its relatively decorous life. To make no mistake about it, the obsessive emphasis in Arab and Western media on formal U.S. announcements and responses to events in Egypt and Tunisia can only show how deeply neocolonialism is steeped in the region.
Isn’t it then a bitter irony to expect the United State to liberate Egyptians from the very conditions that make it function in the region? Wasn’t this very same discourse on the liberation of Arabs what allowed its imperial venture to take place in the region? Don’t all kinds of critique of Israel’s support for Mubarak’s regime seem absurd given the fact that by supporting Mubarak Israel behaves in accordance with its colonial interests in the region and any critique of it must begin with its colonial foundations instead of its contemporary political hypocrisy?
– Seraj Assi is a PhD student in Arabic and Islamic Studies at Georgetown University, Washington DC.

