31 Jan 2011

America’s Ungovernable Budget

by Jeffrey D. Sachs

NEW YORK – The heart of any government is found in its budget. Politicians can make endless promises, but if the budget doesn’t add up, politics is little more than mere words.

The United States is now caught in such a bind. In his recent State of the Union address, President Barack Obama painted a convincing picture of modern, twenty-first-century government. His Republican Party opponents complained that Obama’s proposals would bust the budget. But the truth is that both parties are hiding from the reality: without more taxes, a modern, competitive US economy is not possible.

Obama rightly emphasized that competitiveness in the world today depends on an educated workforce and modern infrastructure. That is true for any country, but it is especially relevant for rich countries. The US and Europe are in direct competition with Brazil, China, India, and other emerging economies, where wage levels are sometimes one-quarter those in high-income countries (if not even lower). America and Europe will keep their high living standards only by basing their competitiveness on advanced skills, cutting-edge technologies, and modern infrastructure.

That is why Obama called for an increase in US public investment in three areas: education, science and technology, and infrastructure (including broadband Internet, fast rail, and clean energy). He spelled out a vision of future growth in which public and private investment would be complementary, mutually supportive pillars.

Obama emphasized these themes for good reason. Unemployment in the US now stands at nearly 10% of the labor force, in part because more new jobs are being created in the emerging economies, and many of the jobs now being created in the US pay less than in the past, owing to greater global competition. Unless the US steps up its investment in education, science, technology, and infrastructure, these adverse trends will continue.

But Obama’s message lost touch with reality when he turned his attention to the budget deficit. Acknowledging that recent fiscal policies had put the US on an unsustainable trajectory of rising public debt, Obama said that moving towards budget balance was now essential for fiscal stability. So he called for a five-year freeze on what the US government calls “discretionary” civilian spending.

The problem is that more than half of such spending is on education, science and technology, and infrastructure – the areas that Obama had just argued should be strengthened. After telling Americans how important government investment is for modern growth, he promised to freeze that spending for the next five years!

Politicians often change their message from one speech to the next, but rarely contradict it so glaringly in the same speech. That contradiction highlights the sad and self-defeating nature of US budget policies over the past 25 years, and most likely in the years to come. On the one hand, the US government must invest more to promote economic competitiveness. On the other hand, US taxes are chronically too low to support the level of government investment that is needed.

America’s fiscal reality was made painfully clear two days after Obama’s speech, in a new study from the Congressional Budget Office, which revealed that the budget deficit this year will reach nearly $1.5 trillion – a sum almost unimaginable even for an economy the size of the US. At nearly 10% of GDP, the deficit is resulting in a mountain of debt that threatens America’s future.

The CBO study also made clear that December’s tax-cut agreement between Obama and the Republican opposition willfully and deliberately increased the budget deficit sharply. Various tax cuts initiated by George W. Bush were set to expire at the end of 2010. Obama and the Republicans agreed to continue those tax cuts for at least two years (they will now probably continue beyond that), thereby lowering tax revenue by $350 billion this year and again in 2012. Tax cuts for the richest Americans were part of the package.

The truth of US politics today is simple. The key policy for the leaders of both political parties is tax cuts, especially for the rich. Both political parties, and the White House, would rather cut taxes than spend more on education, science and technology, and infrastructure. And the explanation is straightforward: the richest households fund political campaigns. Both parties therefore cater to their wishes.

As a result, America’s total tax revenues as a share of national income are among the lowest of all high-income countries, roughly 30%, compared to around 40% in Europe. But 30% of GDP is not enough to cover the needs of health, education, science and technology, social security, infrastructure, and other vital government responsibilities.

One budget area can and should be cut: military spending. But even if America’s wildly excessive military budget is cut sharply (and politicians in both parties are resisting that), there will still be a need for new taxes.

The economic and social consequences of a generation of tax cutting are clear. America is losing its international competitiveness, neglecting its poor – one in five American children is trapped in poverty – and leaving a mountain of debt to its young. For all of the Obama administration’s lofty rhetoric, his fiscal-policy proposals make no serious attempt to address these problems. To do so would require calling for higher taxes, and that – as George H. W. Bush learned in 1992 – is no way to get re-elected.

Jeffrey D. Sachs is Professor of Economics and Director of the Earth Institute at Columbia University. He is also Special Adviser to United Nations Secretary-General on the Millennium Development Goals.

Copyright: Project Syndicate, 2011.

A Press Without Principles

by Naomi Klein

NEW YORK – Julian Assange, the founder of WikiLeaks, is in the news again, this time after former Swiss banker Rudolf Elmer turned over to him confidential records on roughly 2,000 wealthy individuals that Elmer claims contain evidence of money laundering and tax evasion. Elmer was quickly convicted of violating Switzerland’s bank-secrecy law, but few journalists have demanded that Assange be prosecuted for his role in the affair. That, apparently, happens only in the United States.

There, in the midst of the debate over WikiLeaks’ ongoing release of classified US State Department cables, and as the government threatens Assange with extradition and prosecution, respected journalists are running for cover. One would expect lead editorials by The New York Times, The Wall Street Journal, and USA Today, not to mention all major television outlets, defending WikiLeaks’ right to publish. Instead, all we have heard is an awkward, deafening, and breathtakingly hypocritical silence – or worse.

Most American journalists fully understand that Assange did not illegally obtain classified material; the criminally liable party is whoever released the material to the site. He is not the equivalent of Daniel Ellsberg, who in 1971 illegally released the Pentagon Papers, the US military’s secret history of the Vietnam War; rather, he is analogous to The New York Times, which made the brave and correct decision to publish that material.

Moreover, American journalists know perfectly well that they, too, traffic in classified material constantly – indeed, many prominent US reporters have built lucrative careers doing exactly what Assange is doing. Any dinner party in media circles in New York or Washington features journalists jauntily showing prospective employers their goods, or trading favors with each other, by disclosing classified information.

On CNN recently, a long pause followed when I asked legal analyst Jeffrey Toobin – who was calling for Assange’s arrest – if he had really never handled classified information. That is what serious journalists do, after all: their job is to find out what government officials do not want revealed.

American journalists also know that the government classifies information mostly to spare it embarrassment, or for expediency, rather than because it has genuine national-security concerns. Many of the Washington Post reporter Bob Woodward’s bestselling books, which have made him America’s highest-paid print journalist, are based on classified information.

So where are the calls for Woodward’s arrest? Why do all these reporters, who get praise and money for doing what Assange has done, maintain a cowardly silence (at best) while a fellow publisher faces threats of extradition, banning, and espionage charges (which can incur the death penalty), not to mention calls for his assassination?

One reason might be the sexual-misconduct charges against Assange. But any serious journalist knows that the two issues must not be conflated. The right to free expression applies to rogues and scoundrels, sleazy personalities, and even criminals. Indeed, the most famous free-speech cases – the ones that are supposed to showcase America’s strength and moral power – involve the protection of speech that most decent people hate.

So, again: why have US journalists and editors turned Assange into a pariah? According to Nancy Youssef, a journalist for McClatchy Newspapers, the Freedom of the Press Committee of the Overseas Press Club of America in New York City declared Assange to be “not one of us.” The Associated Press refuses to comment on him. And even the National Press Club decided not to speak publicly about the possibility that Assange may be charged with a crime. Instead, it has fallen to foreign press organizations to defend him.

The Assange case shows that no coup is needed to close down an open society. You need only accomplish a few key critical tasks. One is to intimidate journalists, say, by accusing a high-profile reporter of “treason” or endangering national security through his reporting, and then threatening him with torture, a show trial, or indefinite detention. No mass arrests or further threats are required, because other reporters immediately start to police and censor themselves – and to attack the “traitor” in their midst.

There is another sense in which, from the perspective of establishment US journalists, Assange is “not one of us.” American journalism’s business model is collapsing; the people who should be defending Assange are facing salary cuts or unemployment, owing in large part to the medium that he represents. These journalists’ self-interested prejudice against a medium in which they are not the gatekeepers prevents them from conceding that Assange is a publisher, rather than some sort of hybrid terrorist blogger.

In this, paradoxically, they have become like the outraged US government officials who are now threatening Assange, and who also are no longer able to control the flow of information. In their behavior toward Assange, the US government and major American media are lashing out at the face of a future in which there are no traditional gatekeepers, and all institutions live in glass houses.

This is why pursuing Assange is futile and absurd. Even if he is locked up forever, the world of the future is a WikiLeaks world. Trying to convict him is like trying to convict the first person who installed a telephone. In five years, every major institution could be held accountable by its own version of WikiLeaks – so that taxpayers, shareholders, members of university communities, and so on, can find out what the traditional gatekeepers prefer to hide.

When bullied, journalists can protect themselves only by fighting back – as a group. And when a technology-led change is inevitable, integrating it into an open society should be one of journalism’s chief tasks. But that mission now seems lost in America.

Naomi Wolf is a political activist and social critic whose most recent book is Give Me Liberty: A Handbook for American Revolutionaries.

Copyright: Project Syndicate, 2011.

Psywar: On Ghost-Modern Hyperreality

Riveting debut film on controlling the public mind

by Kim Petersen

Psywar is a sterling debut documentary from writer-director Scott Noble. It is chock full of interviews with thinkers, historical background, and excellent narration by Mikela Jay.

Psywar explores the evolution of propaganda and public relations in the United States, with an emphasis on the “elitist theory of democracy” and the relationship between war, propaganda, and class.

This film is designed both as an introduction to the concept of psychological warfare by governments against their citizens and as an exploration of certain dominant themes in American propaganda. Significant time is also devoted to different conceptions of “democracy” as theorized by figures like Walter Lippmann, Edward Bernays, and the “founding fathers” of the United States itself.

Psywar illuminates how the state of the world reached the point it is at today: where an imperialist United States wages several wars abroad and maintains the support of its people, despite a growing and yawning chasm between the haves (who profit from warring) and the have-nots (cannon fodder deluded by unquestioning patriotic idealism). The US has managed to drag its fellow capitalist nations along in more-or-less support of its imperialist aggressions.

People who analyze the state of the world and consider the manifest moral and humanitarian violations might be forgiven for shaking their heads that such a whopping segment of humanity could go along with such inequality, such carnage, such insouciance.

Psywar begins by looking at how people’s distorted perceptions are crafted and maintained
In the opening segment of Psywar, there is video footage of American soldiers defacing a statue of Iraqi president Saddam Hussein with the Old Glory. It was a staged event by psyop group. The film then segues into another infamous pysop about the fallen American soldier Jessica Lynch. Both events were disinformation campaigns that deliberately misreported events.

John Rendon, an “information warrior and perception manager,” is a major player in the $200 billion a year perception-management industry. Rendon is the figure who orchestrated the effort to sell the American public on a war against Iraq. The American public was buying it early on. At best, it can be stated the government thought highly enough about the public acumen that it resorted to disinformation; at least public perception matters.

The corporate media is heavily complicit in the warmongering and warring, even to the extent that psywarriors at CNN “helped in the production of news.”

Psywar points to a synergy: “The invasion of Iraq represents a pinnacle of domestic psywar in the United States, an unparalleled integration between [sic] public relations firms, corporate media, and military psyops.”

The perception management was so powerful that even soldiers were so deceived that they engaged in the greatest crime as defined by the Nuremberg Tribunal at the end of World War II: aggression.

Perception management is “steeped in class warfare.” Psywar tells the story of the exploitation of workers by the wealthy Rockefeller family. Striking coal miners seeking better working conditions and pay were attacked by the National Guard who were in the pay of the Rockefeller family. It is known as the Ludlow Massacre.

In one of his last videotaped interviews, historian Howard Zinn explains the dilemma of the working poor against plutocrats such as the Rockefeller family.

The Ludlow Massacre was a PR nightmare for the Rockefellers. An early psywarrior, Ivy Lee was instrumental in attempting to rehabilitate the image of the Rockefellers. His public relations involved smears and disinformation against the coal miners and their supporters. As Psywar mentions later in the film, Lee would later propagandize for Nazis against Americans.

Early on, it became clear that public perception needed to operate behind the scenes. Staged PR was arranged, such as charity.

Richard Coniff, author of A Natural History of the Rich, challenges the philanthropy of rich – stating that the rich hold a “functional view of wealth rather than a strictly charitable view.”

Zinn agreed, noting that charity can be exploitative and that the American system is exploitative. Zinn said that the “system is maintained [...] by giving people a little bit, and giving enough people just enough to prevent them from breaking out in open rebellion”

In the second part of the documentary, Noble looked at propagating the faith. It begins with Graeme MacQueen, co-founder of the Center for Peace Studies. He also holds that the support of the people is necessary for war. However, he said “war is disgusting to most people”; therefore great psychological pressure is brought to bear upon soldiers.

National Security is there to swindle people

Christopher Simpson, author of The Science of Coercion, says propaganda is about mindset and ideology.

Recognizing this, Psywar relates how president Woodrow Wilson helped cast the propagandistic George Creel Commission which would pave the way for the US to enter World War I by planting false atrocity stories, stoking fear in Americans and calling on them to fight the good fight for democracy.

The propagandist firm of Hill and Knowlton arranged an infamous staged op as a prelude to an assault against Iraq. A teenage girl, Nasriyah, cried crocodile tears and lied about babies being ripped from incubators by Iraqi soldiers. The false story moved American sentiment to back military action against Iraqi soldiers in Kuwait.

Patriotism is the sentiment widely relied upon by governments to attain their ends against foreign foes. Historian Michael Parenti appears to challenge typical notions of patriotism. He identifies patriotism as being about greater values than attacking foreign lands; he sees it as about social justice, peace and stability, an end to racism, etc.

Another problem identified as preventing a public solidarity was that unions were based on gender and ethnicity.

Historian Sharon Smith said a breakthrough came with the anarcho-syndicalist union the Industrial Workers of the World (better known as the Wobblies) which set out to organize and include women, immigrants, and African Americans in one big union.

Anarcho-syndicalist scholar Noam Chomsky holds that it is natural for humans to free associate.

The unity among humans is thwarted by a state which uses war to accumulate power and by corporations to gain enormous fortunes. The Left worldwide labor movement is in disarray

In part 3, We the People, Psywar elucidates on how people are pawns in a system set up in favor of the wealthy.

The existence of democracy is refuted. Chomsky calls elections “a marketing exercise.”

Says William I. Robinson, editor of Critical Globalization Studies, we live in polyarchy: “a system of elite rule.” That is the way the system was designed to be.

Historian John Manley states that the so-called founding fathers were slave owners who sought to protect propertied interests. To this end, the Constitution was crafted behind closed doors. Chomsky notes that James Madison, the major framer of the Constitution, designed it to protect the opulent from the majority.

Littler known is that the US Constitution is based on the Kaianerekowa (Great Law of Peace) of the Haudenosaunee (called Iroquois in Psywar). Stephen M. Sachs, author of Remembering the Circle, lists how the Kaianerekowa allowed the Haudenosaunee to easily remove corrupt leaders, that women had a major role in decision-making, that everyone was involved in policy formation, thus creating a participatory society.

One weak link stood out in Psywar. Why did the film turn to a white man to tell the history of “native Americans”? Why not talk to one of the Haudenosaunee?

The final part of Psywar is Consumers. People are indoctrinated to see themselves as consumers. Advertising reminds people of this. The system would have people work to consume. To this end, the emphasis is on work, not leisure. It is feared that less hours of work might foment radicalism.

Sut Jhally of the Media Education Foundation attacked consumptive society: “The problem of capitalism is the problem of consumption. And the problem is that after your needs have been met, there is no real need for consumption.”

The system is reeling now. Neoliberalism calls for cutbacks and results in increasing inequality. Parenti said we are back to about 1900 in terms of inequality. “People are poor because they are paid less than the value that they produce. You need poverty. Poverty is needed if you are gonna have wealth.”

Psywar argues that it is the monopoly media’s relentless propaganda that holds up capitalism. Democracy and capitalism are argued to be mutually exclusive. If capitalism is sacrosanct, then you can not have democracy.

“Behind political democracy was economic equality.”

Psywar tells the story of how and why the world is the way it is now. It tells of the system, why it was concocted and why it is kept in place.

Knowledge is requisite to combat propaganda and disinformation. It is necessary to overcome the system and to erect a people-centered system that respects the needs and aspirations of the society as a whole. Psywar makes clear that public opinion is important. If it were not important, then there would be no need for perception management. It is the incessant propaganda and disinformation that creates a perception of reality. Noble reveals the framework that exploits class, race, gender, and resources to benefit the already wealthy at the expense of the masses.

Psywar is a documentary that augurs well for future filmmaking by Noble who made the film for $1500 while working a blue collar job. It is a good example of the democratization of filmmaking occurring via the internet.

Kim Petersen is co-editor of Dissident Voice. He can be reached at: kim@dissidentvoice.org. Read other articles by Kim.

27 Jan 2011

Why do economists get it so wrong?

By Tim Weber
Business editor, BBC News website, Davos

If there's one thing that's in demand here at the World Economic Forum in Davos, it's economic forecasts.

Where are the economic bubbles? How fast will China grow? When and where will the debt crisis strike? How large should the economic stimulus be? And at its most basic: when should I invest, and where?

There's just one problem: economists have a poor track record for getting it right.

So what are "the perils of economic prediction"? A session at Davos tried to find out, with five of the world's top economists at hand to defend their profession.

It's all a question of timing

Nearly every economic forecast will come true at some point. It's just a question when. Poor economic forecasts can be a bit like a broken clock; it shows the correct time twice a day, when the hour comes around.

Still, economists can see where the problems are, and sense who is vulnerable to a crisis, argues Professor Carmen Reinhart from the University of Maryland, and author of "This time is different: eight centuries of financial folly".

But if you want to get the timing of a crisis right, then "good luck with that," she says.

"We always failed to predict the [economic] turning point," admits Raghuram Rajan, looking back at his days as director of research at the International Monetary Fund (and now at the Chicago Booth School of Business).

"We were always wrong on Africa," he says. His team would issue a forecast for the continent, then conflict would break out somewhere, making the local economy plummet 20%, wrecking the prediction.

Weather forecasts are easy

If economics is a science, then it's not a very exact one.

Think how difficult it is to predict the weather. Overall, though, weathermen do ok, because they know their limits; they look four or five days ahead, but not much more.

Economists, in contrast, have to make long-range predictions. To make matters worse, like weathermen, economists rely on mathematical models. And here's the flaw, argues Robert Shiller, economics professor at Yale University.

The weather follows certain immutable rules, so its models can be based on experience.

It's different for economists. Their models are based on what used to happen, but the ingredients of the economy - humans, resources, wars, natural disasters, technology etc - change constantly.

"The economic profession got too much in love with its models," says Professor Shiller.

And do these models take account of all factors? Emerging markets are attracting huge investments, but is that because economic fundamentals have changed, or because US interest rates are low and investors are searching for higher returns, asks Professor Reinhart.

And then there is human nature, with people always saying that rules apply to other people only. After the Mexican financial crisis in the early 1990s, she remembers, Asians said that these things happen only in Latin America - only for a similar crisis to hit Asia a few years later.

The right kind of economics

So it's not always the economists' fault; it's people who pick and choose what they want to believe.

Joe Stiglitz, former chief economist at the World Bank, recipient of a Nobel Prize in Economics and now with Columbia University, says the financial crisis did prove economics right, it's just that most people applied "the wrong economics".

And there is still a lot of work to be done. Professor Shiller apologised to the audience when he briefly delved deep into a mathematical model - "is anybody still with me?" - but he wanted to make the point that economists were still struggling to understand the feedback loops of the credit crunch.

Why bother?

Paradoxically, while everybody knows that forecasts are mostly wrong, "everybody still demands them," said the senior economist of a large banking group, speaking off the record.

To make things worse, he said, economists - just like investors - were suffering from a very bad case of "group think" where "everybody is unwilling to stick their nose out" and challenge the consensus.

"If you step outside the comfort band of the consensus forecast," agrees Simon Johnson from the MIT Sloan School of Management and another former IMF chief economist, "you get beaten up, you can risk your career."

This consensus, in turn, will make an impact, warns Professor Stiglitz: "If the chairman of the Federal Reserve says we have a new paradigm, and other economists say he's wrong, who will people believe? People will believe the Fed, and that in turn influences the economic outcome.

So why bother with economic forecasts?

"It's a starting point for analysis or discussion," says the chief executive of a large asset management firm, "but you don't have to believe it... economists are just one input among many."

So how often do the economists advising his firm get it right?

He shrugs his shoulders: "Oh, about 3 or 4 times out of ten."

25 Jan 2011

On Immoral Axes and Moral Axmen

By Zygmunt Bauman

During the last world war, George Orwell mused: „As I write, highly civilized human beings are flying overhead, trying to kill me. They do not feel any enmity against me as an individual, nor I against them. They are ‘only doing their duty’, as the saying goes.“ A few years later, scanning the vast multi-tiered graveyard called Europe in search the kind of humans who managed to do that to other humans, Hannah Arendt laid bare the “floating” habit of responsibility inside a bureaucratic body; the consequences of such flotation she named “responsibility of nobody”. More than half century later, we could say much the same of the current state of the killing arts. Continuity? Oh yes, there is a continuity, though true to the continuity’s habits, in company with a few discontinuities…

The major novelty is the effacing of status differences between means and ends. Or, rather, the war of independence ending in the victory of axes over the axmen. It is now the axes who select the ends: the heads to be axed. The axmen can do little more to stop them (i.e., to change their minds which they do not have or appeal to their feelings which they do not possess) than did the legendary sorcerer’s apprentice (this allegory is by no means fanciful: as the military experts Tom Shanker and Matt Richtel put it a recent edition of the NYT, “just as the military has long pushed technology forward, it is now at the forefront in figuring out how humans can cope with technology without being overwhelmed by it”). And as the neuroscientist Art Kramer sees the situation, “there is information overload at every level of the military – from the general to the soldier on the ground”. Everybody in the army, “from the general to the soldier on the ground”, has been demoted from the sorcerer’s office to the lowly rank of his apprentice.

Since 11 September, the amount of “intelligence” gathered by the cutting-edge technology at the US Army disposal has risen by 1600%. It is not that the axmen lost their conscience or have been immunized against moral scruples; they simply can’t cope with the volumes of information amassed by the gadgets they operate. The gadgets, as a matter of fact, can now do as well (or as badly…) with or without their help, thank you. Kick the axmen away from their screens, and you’d hardly notice their absence looking at the distribution of results.

By the start to the 21st century, military technology has managed to float and so “depersonalise” responsibility to the extent unimaginable in Orwell’s or Arendt’s time. “Smart”, “intelligent” missiles or the “drones” have taken over the decision-making and the selection of targets from both rank-and-file and the highest placed ranks of the military machine. I would suggest that most seminal technological developments in recent years have not been sought and accomplished in the murderous powers of weapons, but in the area of “adiaphorization” of military killing (i.e., removing it from the category of acts subject to moral evaluation). As Günther Anders warned after Nagasaki but still well before Vietnam, Afghanistan or Iraq, “one wouldn’t gnash teeth when pressing a button… A key is a key”.[i] Whether the pressing of the key starts a kitchen ice-cream-making contraption, feeds current into an electricity network, or lets loose the Horsemen of Apocalypse, makes no difference. “The gesture that will initiate the Apocalypse would not differ from any of the other gestures – and it will be performed, as all other identical gestures, by a similarly routine-guided and routine-bored operator”. “If something symbolizes the satanic nature of our situation, it is precisely that innocence of the gesture”[ii], Anders concludes: “the negligibility of the effort and thought needed to set off a cataclysm – any cataclysm, including the “globocide”…

What is new is the “drone”, aptly called “predator”, that took over the task of gathering and processing information. The electronic equipment of the drone excels in performing its task. But which task? Just like the manifest function of an axe is to enable the axman to execute the convict, the manifest function of the drone is to enable its operator to locate the object of the execution. But the drone that excels in that function and keeps flooding the operator with the tides of information he is unable to digest, let alone promptly and swiftly, “in real time”, to process – may be performing another, latent and unspoken-about function: that of exonerating the operator of the moral guilt that would haunt him were he fully and truly in charge of selecting the convicts for the execution; and, more importantly yet, reassuring the operator in advance that in case a mistake happens, it won’t be blamed on his immorality.

If “innocent people” are killed, it is a technical fault, not a moral failure or sin – and judging from the statute books most certainly not a crime. As Shanker and Richtel put it, “drone-based sensors have given rise to a new class of wired warriors who must filter the information sea. But sometimes they are drowning”. But is not the capacity to drown the operator’s mental (and so, obliquely but inevitably, moral) faculties included in the drone’s design? Is not drowning the operator the drone’s paramount function? When last February 23 Afghan wedding guests were killed, the buttons-pushing operators could blame it on the screens turned into “drool buckets”: they got lost just by staring into them. There were children among the bombs victims, but the operators “did not adequately focus on them amid the swirl of data” – “much like a cubicle worker who loses track of an important e-mail under the mounting pile”. Well, no one would accuse such a cubicle worker of moral failure…

Starting off a cataclysm (including, as Anders insists, “the globocide”) has now become yet easier and more plausible than it used to be when Anders wrote down his warnings. The “routine-bored operator” has been joined by his colleague and his probable replacement and successor – with his eyes fixed on a “drool bucket”, and his mind drowning in a “swirl of data”…


[i] See Günther Anders, Der Mann auf der Bruecke, Munich 1959, p.144.
[ii] See Günther Anders, Le temps de la fin, Paris 2007 (originally 1960), pp.52-53.

20 Jan 2011

Fifty Years After Eisenhower’s Farewell Address, A Look at the "Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex"

via Democracy Now

This week marks the 50th anniversary of President Dwight D. Eisenhower’s famous farewell speech to the nation in which he warned against the rise of a "military-industrial complex." We speak with William Hartung, director of the Arms and Security Initiative at the New America Foundation, who traces the rise of the military-industrial complex through the story of the nation’s largest weapons contractor, Lockheed Martin. Hartung’s new book is Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex.

19 Jan 2011

Et Tu, BRu...ssia?

Adding to a host of key Latin American countries, Russia is the latest country to have recognised Palestinian statehood. Palestine's eventual recognition by the United Nations' Security Council will confirm the illegal occupation by Israel of a sovereign, UN member. By then, the Global Boycott, Divestment and Sanctions Campaign against the illegal occupation of Palestinian territories by Israel would have become a truly international tool designed to end the Zionist regime's apartheid policies.

via al Jazeera
Russia backs Palestinian state

In a visit to occupied West Bank, president Dmitry Medvedev says Moscow recognises independent state for Palestinians.

Russia's President Dmitri Medvedev endorsed a Palestinian state [Reuters]
Dmitry Medvedev, the Russian president, has reaffirmed recognition of the Palestinian state, saying Moscow will not change the position adopted by the former Soviet Union when it recognised independence for Palestinians in 1988.
"Russia's position remains unchanged. Russia made its choice a long time ago," Medvedev said at a news conference in the West Bank city of Jericho on Tuesday.

"We supported and will support the inalienable right of the Palestinian people to an independent state with its capital in East Jerusalem."

Medvedev made the comments during his first visit to the Israeli-occupied West Bank as Russian head of state.

He stopped short of issuing a declaration of recognition of Palestinian statehood by the modern Russian Federation, which he represents. But much like the rest of the world, he was supportive of a Palestinian state along the 1967 borders.

The visit and meeting with his Palestinian counterpart, Mahmoud Abbas, reinforced already strong Russian-Palestinian ties, Al Jazeera's Nour Odeh said, reporting from the West Bank city of Ramallah.

'Hopes and optimism'

Abbas thanked Russia for being "one of the first states in the world to recognise the state of Palestine in 1988".

"This surely has raised a lot of hopes and a lot of optimism among Palestinians that this kind of recognition would boost their efforts and might influence the upcoming quartet meeting in February," Al Jazeera's Odeh said.

Russia is a partner of the United States, European Union and United Nations in "the Quartet", the international powers overseeing Middle East peace negotiations.

Medvedev arrived ahead of next month's quartet meeting in Munich, in a bid to try and help revive stalled Israeli-Palestinian peace talks.

The negotiations collapsed at the end of last year after Israel refused to extend a 10-month partial freeze on settlement-building in the occupied West Bank.

"We discussed the possible prospects of resuming the dialogue," Medvedev said. "In order to do that, we need to express maximum moderation. This in the first place relates to the freezing of settlement activity of Israel on the West Bank and in East Jerusalem."

On Tuesday, Medvedev stressed the importance of compromise, saying there would be "no progress" without an Israeli decision on settlement building.

"Russia [is] aligning itself with the Palestinian position and implying that it would relay that position when the international quartet meets," our correspondent said.

She added that Palestinians are hoping Russia's move adds momentum together with the several other countries that have also recognised Palestine.

Talks collapsed

With the collapse of peace talks with Israel, the Palestinians have been talking up their options if impasse continues. One of the options is seeking recognition for a unilateral declaration of statehood.

In the past two months, there has been a string of recognitions by Latin American states including Brazil and Argentina, which some analysts say could be a precursor to a move by the Palestinians to seek full United Nations membership.

The Palestinians today say 109 states out of 192 United Nations member countries recognise their statehood.

Israel has warned that a "unilateral declaration" of statehood would set back the peace process.

"I'm sure that with the establishment of a Palestinian state, everyone will win - Palestinians and Israelis," Medvedev said.

In addition to the political significance of Medvedev's visit, at least three agreements were also signed between the leaders, and about $30m allocated to media, agriculture and sport in the region, ensuring a lot more Russian involvement in Palestinian nation-building, our correspondent said.

New Rules for the Global Economy

By Dani Rodrik, Project Syndicate, via Policy Innovations - A Publication of the Carnegie Council

Suppose that the world's leading policymakers were to meet again in Bretton Woods, New Hampshire, to design a new global economic order. They would naturally be preoccupied with today's problems: the eurozone crisis, global recovery, financial regulation, international macroeconomic imbalances, and so on. But addressing these issues would require the assembled leaders to rise above them and consider the soundness of global economic arrangements overall.

Here are seven commonsense principles of global economic governance that they might agree on. (I discuss them in more detail in my new book, The Globalization Paradox.)

1. Markets must be deeply embedded in systems of governance. The idea that markets are self-regulating received a mortal blow in the recent financial crisis and should be buried once and for all. Markets require other social institutions to support them. They rely on courts, legal frameworks, and regulators to set and enforce rules. They depend on the stabilizing functions that central banks and countercyclical fiscal policy provide. They need the political buy-in that redistributive taxation, safety nets, and social insurance help generate. And all of this is true of global markets as well.

2. For the foreseeable future, democratic governance is likely to be organized largely within national political communities. The nation state lives, if not entirely well, and remains essentially the only game in town. The quest for global governance is a fool's errand. National governments are unlikely to cede significant control to transnational institutions, and harmonizing rules would not benefit societies with diverse needs and preferences. The European Union may be the sole exception to this axiom, though its current crisis tends to prove the point.

Too often we waste international cooperation on overly ambitious goals, ultimately producing weak results that are the lowest common denominator among major states. When international cooperation does "succeed," it spawns rules that are either toothless or reflect the preferences of only the more powerful states. The Basel rules on capital requirements and the World Trade Organization's rules on subsidies, intellectual property, and investment measures typify this kind of overreaching. We can enhance the efficiency and legitimacy of globalization by supporting rather than crippling democratic procedures at home.

3. Pluralist prosperity. Acknowledging that the core institutional infrastructure of the global economy must be built at the national level frees countries to develop the institutions that suit them best. The United States, Europe, and Japan have produced comparable amounts of wealth over the long term. Yet their labor markets, corporate governance, antitrust rules, social protection, and financial systems differ considerably, with a succession of these "models"—a different one each decade—anointed the great success to be emulated.

The most successful societies of the future will leave room for experimentation and allow for further evolution of institutions. A global economy that recognizes the need for and value of institutional diversity would foster rather than stifle such experimentation and evolution.

4. Countries have the right to protect their own regulations and institutions. The previous principles may seem innocuous. But they carry powerful implications that clash with the received wisdom of globalization's advocates. One such implication is the right of individual countries to safeguard their domestic institutional choices. Recognition of institutional diversity would be meaningless if countries did not have the instruments available to shape and maintain—in a word, "protect"—their own institutions.

We should therefore accept that countries may uphold national rules—tax policies, financial regulations, labor standards, or consumer health and safety rules—and may do so by raising barriers at the border if necessary, when trade demonstrably threatens domestic practices enjoying broad popular support. If globalization's boosters are right, the clamor for protection will fail for lack of evidence or support. If wrong, there will be a safety valve in place to ensure that contending values—the benefits of open economies versus the gains from upholding domestic regulations—both receive a proper hearing in public debates.

5. Countries have no right to impose their institutions on others. Using restrictions on cross-border trade or finance to uphold values and regulations at home must be distinguished from using them to impose these values and regulations on other countries. Globalization's rules should not force Americans or Europeans to consume goods that are produced in ways that most citizens in those countries find unacceptable. But nor should they allow the United States or the European Union to use trade sanctions or other pressure to alter foreign countries' labor-market rules, environmental policies, or financial regulations. Countries have a right to difference, not to imposed convergence.

6. International economic arrangements must establish rules for managing interaction among national institutions. Relying on nation states to provide the essential governance functions of the world economy does not mean that we should abandon international rules. The Bretton Woods regime, after all, had clear rules, though they were limited in scope and depth. A completely decentralized free-for-all would benefit no one.
What we need are traffic rules for the global economy that help vehicles of varying size, shape, and speed navigate around each other, rather than imposing an identical car or a uniform speed limit. We should strive to attain maximum globalization consistent with the maintenance of space for diversity in national institutional arrangements.

7. Non-democratic countries cannot count on the same rights and privileges in the international economic order as democracies. What gives the previous principles their appeal and legitimacy is that they are based on democratic deliberation—where it really occurs, within national states. When states are not democratic, this scaffolding collapses. We can no longer presume that its institutional arrangements reflect its citizens' preferences. So non-democracies need to play by different, less permissive rules.

These are the principles that the architects of the next global economic order must accept. Most importantly, they must comprehend the ultimate paradox that each of these principles highlights: Globalization works best when it is not pushed too far.

Dani Rodrik is Professor of Political Economy at Harvard University's John F. Kennedy School of Government and the author of One Economics, Many Recipes: Globalization, Institutions, and Economic Growth.

© 2011 Project Syndicate. Republished with kind permission.

Obama Pulls a Clinton

Robert Scheer's Columns

by Robert Scheer

Here we go again. When Bill Clinton suffered an electoral reversal after his first two years in office, he abruptly embraced the corporate money guys who had financed his congressional opposition in an effort to purchase a second term. On Tuesday in his Wall Street Journal Op-Ed piece, Barack Obama veered sharply down that same course, trumpeting his executive order “ ... to remove outdated regulations that stifle job creation and make our economy less competitive. …”

He employed the same “creating a 21st-century regulatory system” rationalization used by Clinton when he signed off on the sweeping deregulation legislation that unleashed the Wall Street greed that ended up being the biggest job-killer since the Great Depression. “Over the (past) seven years, we have tried to modernize the economy,” Clinton enthused as he signed the Financial Services Modernization Act that repealed key New Deal legislation, adding, “And today what we are doing is modernizing the financial services industry, tearing down those antiquated laws and granting banks significant new authority.” Modernizing was the propaganda constant, as in the Commodity Futures Modernization Act that Clinton signed, thus shielding financial derivatives from any government regulation.

That deregulation, as Obama concedes in his WSJ column, led to “a lack of proper oversight and transparency (that) nearly led to the collapse of the financial markets and a full-scale depression.” But Obama now promises that his deregulation efforts will be more sensibly targeted and will “bring order to regulations that have become a patchwork of overlapping rules, the result of tinkering by administrations and legislatures of both parties and influence of special interests in Washington over decades.”

When he wrote that he intends to accomplish this revamp “with more input from experts, businesses and ordinary citizens,” did he have in mind his two new key White House advisers who were the most effective advocates for those special interests? Tom Donilon, Obama’s national security adviser, was the Washington lobbyist for the housing behemoth Fannie Mae, which will cost taxpayers $700 billion because of its marketing of toxic derivatives. Obama’s new Chief of Staff William Daley was the lead Washington representative for a similarly afflicted JPMorgan Chase. These are the folks, along with many other Wall Street alums in this administration, who will oversee the latest update of already weakened regulations.

The first target will be the administration’s puny efforts to protect consumers: “The move is the latest effort by the White House to repair relations with corporate America,” the Wall Street Journal’s report on Obama’s column stated, “Business leaders say an explosion in new regulations stemming from the president’s health-care and financial regulatory overhauls has, along with the sluggish economy, made them reluctant to spend on expansion and hiring. Companies are sitting on nearly $2 trillion in cash and liquid assets, the most since World War II.”

This is a case of corporate blackmail pure and simple. The economy is sluggish because of a housing crisis that shows no sign of improvement. It stands history on its head to blame government financial regulations that had worked splendidly for six decades for the meltdown or the failure to fix a housing market that is the key to improved consumer spending.
Fixing housing would require efforts to keep the 50 million Americans whose mortgages are underwater in their homes. But the government bailouts under both George W. Bush and Obama have not required any significant cramp-down or reappraisal of mortgages by banks to enable people to stay in their homes. Instead the Fed and Treasury have flooded the banks and top corporations with cheap money and bailouts but, in the classic problem of pushing on a string, the corporate ingrates are hoarding that money.

Obama, and the party he heads, failed to provide a progressive narrative during November’s election holding the financial elite that created this mess responsible. The key issue is not big government or onerous regulation but rather transparency and fraud prevention. When you are evicted, it is a government agent, a marshal or sheriff, who will force you out, so shouldn’t the government also be involved in assuring that the consumer is protected by a properly vetted contract? Instead the U.S. Chamber of Commerce spearheaded the marketing of an alternative narrative, as successful as it was devious, by Republican candidates that held regulation—rather than deregulation—responsible for the mess. Now Obama seems poised to join their ranks. As the WSJ reported:

“On Feb. 7, Mr. Obama will visit the U.S. Chamber of Commerce—a chief opponent to his administration’s regulatory approach—for a discussion on how the White House can work with the group to create jobs. The efforts are designed to give companies more confidence in the president’s stewardship of the economy, and bolster his re-election prospects among a wealthy constituency not traditionally allied with Democrats.”

A constituency that Daley, Obama’s new chief of staff, can faithfully represent, having received $5 million a year from JPMorgan Chase. And so ends the season of hope for the less wealthy constituency traditionally allied with Democrats.

18 Jan 2011

Public Expenditure and the Affordability Fallacy

a morcel of food for thought for my fellow researchers at one of Romania's top academic institutions...

by John Weeks

Implicit in almost every discussion on public expenditure and revenue, and most virulently on the debate over deficit reduction, is the fallacy of public affordability. This fallacy is manifested, for example, in the argument in the United Kingdom that if university education is available to a large portion of the population, the public sector cannot afford to deliver it without substantial fees, even less to provide support grants to all students. This lack of public sector ‘affordability’ means that people must pay for their own education.

Because ‘the public sector cannot afford’ to provide university education, it is necessary to ration the public contribution on the basis of need (income or means testing). The same argument is applied in every major area of social expenditure: with an ageing population, ‘the public sector cannot afford’ more than a safety net pension; cannot afford to provide all the drugs and care needed by that ageing population, and so on.

‘Affordability’ arguments are fallacious. The fallacy is obvious once one views it from the level of society as a whole. Consider education. Only a tiny minority of people would argue that individual families should wholly fund the primary education of their children with no public sector contribution. This near-consensus results from the conviction that children have a right to be educated, and that a democratic society requires an educated and informed public. These convictions determine the provision of primary education by the public sector, not public finances. Primary education should be for everyone, regardless of income or status, and if some wish to contract for private education, they may do so. The social consensus on public provision of secondary education is equally broad (for everyone), but the number of years provided varies (lower in Britain than most developed countries). Only a few on the far right wing would argue that the public sector “cannot afford” to provide primary and secondary education for all, though in practice many right of centre attempt to minimize the expenditure and therefore the quality of provision.

The same principle applies to university education: what is the appropriate coverage and to what level? Here there is no consensus, and those who believe that people have no right to higher education avoid taking that potentially damning position by seeking cover under the affordability argument: ‘I wish we could provide everyone with a university education, but we cannot afford it. In any case, people gain personally from higher education, so they should pay for it themselves to the extent that they can. The public sector can only afford to help the poor, and if you are poor and clever you will find funding.’

This line of argument is the most superficial mendacity, and would apply equally to primary and secondary education. The true essence of the affordability of higher education argument is, ‘People have no right to higher education. If they want it, let them pay for it. If you are poor and clever you might go to university. If you are dumb and rich you certainly will.’

When there is a social consensus that people have a right to a university education if they want one, then reducing public expenditure and raising fees does not save society money. There are two affects: 1) for those with high incomes it shifts expenditure from the public sector to households, and 2) for those on low incomes it reduces provision. It ‘saves public money’ in the same sense that not repairing railway bridges is a public sector financial gain.

Most pernicious is the application of the affordability fallacy to pensions and health. Two core values of democratic societies are that children have a right to education and the old have a right to live their final years in decent conditions with dignity. Given this consensus on the elderly, discussing financial affordability is grotesque. The question is, in light of a country’s economic development and productive resources, what level of decency can and should society provide to everyone past a certain age? Once the level is decided, it merely remains to decide the institutional mechanism by which it will be funded. Considerable empirical evidence indicates that provision of pensions through the public sector has the lowest resource cost. This is primarily because unlike private insurers, the public sector need charge no risk premium. Its revenue is guaranteed, and the growth of that revenue is determined by the growth of the economy as a whole.

Even more obvious is the fallacy of the affordability argument for health care. It is an appalling manifestation of the power of capital in US society that there seems to be no consensus that everyone has a right to be healthy, a principle Franklin Roosevelt included in his ‘Economic Bill of Rights’ speech in January 1944, that every American had ‘the right to adequate medical care and the opportunity to achieve and enjoy good health’. In almost every other developed country this principle is accepted. When it is accepted, as with education and pensions, the issue is not financial affordability, nor is it coverage (everyone qualifies). The only issue is the level of society’s obligation to itself on health care.

The affordability argument perpetuates a profoundly anti-social and anti-democratic fallacy. Whoever makes it asserts (as Margaret Thatcher did) that there is no society and no obligation to fellow human beings beyond an absolute minimum that the residual of social decency forces upon even the most reactionary Thatcherite or Reaganite. Reducing that residual of social decency is the project of the affordability fallacy. Existence is viewed as a collection of isolated individuals, for whom one has no concern, even if, or especially if, for those whose lives are rendered nasty, brutish and short.

Hu Jintao visit: China's hubris colours US relations

Further proof of the US's displeasure at its forthcoming fall from grace comes from this former Security Services op and Harvard University Professor, Joseph Nye...

By Joseph Nye

When Barack Obama became US president, one of his top foreign policy priorities was to improve relations with China. Yet on the eve of President Hu Jintao's state visit to Washington, US-China relations are worse, rather than better.

Administration officials feel their efforts to reach out to China have been rebuffed.

Ironically, in 2007, President Hu Jintao had told the 17th Congress of the Communist Party that China needed to invest more in its soft, or attractive, power.

From the point of view of a country that was making enormous strides in economic and military power, this was a smart strategy.

By accompanying the rise of its hard economic and military power with efforts to make itself more attractive, China aimed to reduce the fear and tendencies to balance Chinese power that might otherwise grow among its neighbours.

But China's performance has been just the opposite, and China has had a bad year and a half in foreign policy.

Rising nationalism

For years, China had followed the advice of Deng Xiaoping to keep a low profile.

However, with its successful economic recovery from the recession, China passed Japan as the world's second largest economy, and America's slow recovery led many Chinese to mistakenly conclude that the United States was in decline.

Given such beliefs, and with rising nationalism in China as it prepares for the transition of power to the fifth generation of leaders in 2012, many in China pressed for a more assertive foreign policy.
In 2009, China was justly proud of its success in managing to emerge from the world recession with a high 10% rate of economic growth.

But many Chinese believed that this represented a shift in the world balance of power, and that China should be less deferential to other countries, including the US.

Chinese scholars began writing about the decline of the US. One dated the year 2000 as the peak of American power.

"People are now looking down on the West, from leadership circles, to academia, to everyday folks," said Professor Kang Xiaoguang of Renmin University.

This Chinese view is seriously mistaken and China is unlikely to equal American economic, military or soft power for decades to come.

Nonetheless, this over-confidence in power assessment (combined with insecurity in domestic affairs) led to more assertive Chinese foreign policy behaviour in the last two years.

China miscalculated by deviating from the smart strategy of a rising power and violating the wisdom of Deng Xiaoping who advised that China should proceed cautiously and "skilfully keep a low profile".

But perceptions matter, even when they are wrong. China's new attitudes alienated the Obama administration.

China stage-managed President Obama's trip to Beijing in November 2009 in a heavy-handed way; it over-reacted to Obama's meeting with the Dalai Lama, and the administration's long-expected and relatively modest arms sales to Taiwan.

When asked why they reacted so strongly to things they had accepted in the past, some Chinese responded, "because we were weaker then".

Obama administration officials began to believe that efforts at co-operation or conciliation would be interpreted by the Chinese as proof that the US was in decline.

Alienation and irritation

China's new assertiveness affected its relations with other countries as well.

Its policies in the South China Sea created fear among the Asean nations; and its over-reaction to Japan's actions after a ship collision near the Senkaku Islands put an end to the Democratic Party of Japan's hopes for a closer relationship with China. Instead, the Kan administration reaffirmed the American alliance.
Beijing alienated South Korea by failing to criticize North Korea's shelling of a South Korean island; irritated India over border and passport issues; and embarrassed itself in Europe and elsewhere by over-reacting to the Nobel Peace Prize granted to the jailed dissident Liu Xiaobo.

How will these issues play out in the coming year?

It is likely that China's leaders will draw back somewhat from the overly assertive posture that has proven so costly.

President Hu Jintao's stated desire to co-operate on terrorism, non-proliferation and clean energy will help to lead to a reduction of tensions, but powerful domestic interest groups in the export industries and in the People's Liberation Army will limit economic or naval co-operation.

And most important, given the nationalism that one sees on the blogosphere in China, it will be difficult for Chinese top leaders to change their policies too dramatically.

Mr Hu's state visit will help improve matters, but the relationship will remain difficult as long as the Chinese suffer from hubris based on a mistaken belief in American decline.

Joseph Nye is a professor at Harvard and author of The Future of Power. He was formerly US Assistant Secretary of Defence for International Security Affairs and chairman of the National Intelligence Council.

17 Jan 2011

Wikileaks given data on Swiss bank accounts

A former Swiss banker has passed on data containing account details of 2,000 prominent people to Wikileaks founder Julian Assange.

The data - which is not yet available on the Wikileaks website - was held on two discs handed over by Rudolf Elmer at a press conference in London.

Mr Assange promised full disclosure once the information had been vetted.

Mr Elmer is scheduled to go on trial in Switzerland on Wednesday for breaking bank secrecy laws.

The banker, who has given data to Wikileaks before, was fired from Swiss bank Julius Baer in 2002.

According to a report in Swiss newspaper Der Sonntag, the data covers multinationals, financial firms and wealthy individuals from many countries, including the UK, US and Germany, and covers the period 1990-2009.

Serious Fraud Office

"Once we have looked at the data... there will be full revelation," said Mr Assange, who is currently under house arrest in the UK due to an extradition request from Sweden.

He said the data would be vetted but that it was difficult to say how long this would take. The vetting would depend on the volume of information and how it was delegated, Mr Assange said, although he suggested it could be as little as two weeks.

Other groups - such as the Tax Justice Network or financial media outlets - might be asked to help in the vetting process, he added.

Mr Assange also said some information was likely to be handed over to the authorities - mentioning specifically the UK's Serious Fraud Office - as was the case with a previous leak concerning Icelandic banks.

Although it was not confirmed what activities might be covered by the data, the Wikileaks head noted that previous data from Julius Baer provided by Mr Elmer had shed light on tax evasion, the hiding of proceeds of criminal acts and "the protection of assets of those about to fall out of political favour".

'Fire-breathing dragon'

"I'm against the system. I know how the system works," said Mr Elmer at the press conference. He said a sophisticated network existed to funnel illicit money into secret offshore accounts.

"I've been there. I've done the job. I know what is the day-to-day business," he said, explaining why he thought it important to identify himself as the source.

The banker, who worked as Julius Baer's chief operating officer in the Cayman Islands, said he and his family faced pressure akin to "a fire-breathing dragon with several heads" after he decided to blow the whistle.

He said he was put in prison in Switzerland for 30 days for violating Swiss banking rules, and that he was offered money and the withdrawal of charges against him in order to buy his silence.
He said the data included the offshore accounts of about 40 politicians, and covered accounts at three banks, including his former employer.

The banker said that he and his wife had written a letter to German Finance Minister Peer Steinbruck, offering to provide the data for free, but received no response.

With Friends Like These, Who Needs Democracy?

By Barry Lando

AP / Christophe Ena
Women smile as they walk past a torn photo of ousted Tunisian President Zine el-Abidine Ben Ali in the center of Tunis. Tunisia sped toward a new future after its iron-fisted leader fled, an interim president was sworn in and formation of the country’s first multiparty government was ordered.

Officially, the Obama administration greeted Tunisia’s “Jasmine Revolution”—named after that country’s national flower—with open arms, calling for free and fair elections as the United States scrambled to get aboard the democratic bandwagon.

However, celebration is restrained in Washington. There’s serious concern about who will take the place of Zine el-Abidine Ben Ali, the corrupt, 74-year-old dictator, who, until the end, was considered an important American ally in the war against terror.

Assuming the Tunisian military actually agrees to hold free elections (not at all a sure thing), will the generals really throw open the doors to all political groups? Nationalists? Islamists? Marxists? Anti-militarists? What forces will roil to the surface after decades of political repression? Will they throw in their lot with America’s war against terror, or join the ranks of those in the Middle East who increasingly see what’s going on as America’s war against Islam?

Washington’s ambivalent view was evident even before the revolution was victorious. In Doha on Thursday, U.S. Secretary of State Hillary Clinton lectured Arab autocrats and others meeting there on the urgent need for reform and an end to corruption if they wanted to save their regimes.

But just a couple of days earlier, as young demonstrators were being gunned down in the cities and towns of Tunisia, when Clinton was asked which side the U.S. was on, she replied that the U.S. was “not taking sides.”

American officials have reason to hesitate. If uprisings were to occur across the Middle East and Central Asia, that could spell disaster for American policy.
There is no way, for instance, that Hosni Mubarak, who has ruled Egypt for 30 years, will permit a democratic opening. Thanks to his ironclad dictatorship, only one group has been able to organize politically, the Islamic radicals. More secular-minded opponents have been co-opted, imprisoned or cowed. The influence of the religious extremists has grown throughout the country. It’s only the military that stands between Mubarak and chaos.

Like a deer frozen in oncoming headlights, Washington seems immobilized. On the one hand, there’s the corrupt, despotic and failing Mubarak. But he’s a friend. On the other hand, free and fair elections would almost certainly bring leaders to power much more virulently anti-Israel and opposed to U.S. policies. Perhaps Washington is hoping for the Egyptian military to step in again to save itself and its privileges—and the U.S.

Elsewhere throughout the region, from Saudi Arabia to Jordan to Yemen to Ethiopia to Afghanistan and Pakistan, the picture seems markedly similar: U.S. allies are invariably corrupt dictators, maintained in power by lavish patronage and the military.

In Lebanon, where the public has had a growing voice in national politics, it’s the anti-American and anti-Israel Hezbollah that has ridden popular acclaim to become the decisive voice in the country.

Popular participation has also benefited America’s most outspoken enemy in Iraq: Moqtada al-Sadr, whose followers fought bloody battles against the U.S. after the invasion. Seemingly vanquished, he has returned from three years in Iran to exercise a decisive political voice in Iraq. He demands the withdrawal of all U.S. troops and bases from his country.

Because of the elections in Iraq, the country that will almost certainly be calling the shots there in the future will not be the United States—but Iran.

Meanwhile, moderates pushing for something akin to democracy and secular rule are losing ground. In Pakistan, the governor of Punjab, Salman Taseer, who had been outspoken in his fight against religious fundamentalism, was killed. The soldier responsible for the murder was showered with rose petals while many of the country’s lawyers—who had once gone to the streets demanding democratic reform—celebrated the murderer as a national hero.

And democracy in Israel? A true democracy with a vote for every person—Jews and all the Arabs under Israeli control—including those living on the West Bank? Forget it. It would be the end of the Zionist dream of a Jewish state. We don’t hear Clinton or President Barack Obama talking much about that these days.

Indeed, at the end of her lecture to the Arab leaders in Doha, one member of Secretary Clinton’s audience asked why the U.S. wasn’t doing its share to fight the war against Islamic fundamentalism by putting more pressure on Israel to deal with the Palestinians. Her answer—pointing out that the U.S. paid more to finance the Palestinian Authority than did most of the Arab countries—simply dodged the issue.

After her civics lesson in Doha, Clinton returned to Washington, where, even after the lurid shootings in Arizona, U.S. legislators dare not even discuss clamping down on firearms, because of the powerful gun lobby. It’s the same Washington where American officials, from Obama on down, are terrified of taking on the conservative pro-Israel lobby—not because the lobby represents the views of the majority of Americans—or even a great majority of American Jews, but because it wields a very undemocratic power far beyond its numbers.

BRIC Becomes BRICS: Changes on the Geopolitical Chessboard

by Jack A. Smith / January 15th, 2011

The world’s four main emerging economic powers, known by the acronym BRIC — standing for Brazil, Russia, India and China — now refer to themselves as BRICS.

The capital “S” in BRICS stands for South Africa, which formally joined the four on December 24, bringing Africa into this important organization of rising global powers from Asia, Latin America and Europe. President Jacob Zuma is expected to attend the BRICS April meeting in Beijing as a full member.

This is a development of geopolitical significance, and it has doubtless intensified frustrations in Washington. The U.S. has been concerned about the growing economic and political strength of the BRIC countries for several years. In 2008, for instance, the National Intelligence Council produced a document titled “Global Trends 2025″ that predicted:
The whole international system — as constructed following WW II — will be revolutionized. Not only will new players — Brazil, Russia, India and China — have a seat at the international high table, they will bring new stakes and rules of the game.

More recently, the U.S. edition of the conservative British weekly The Economist noted in its January 1 issue that “America’s influence has dwindled everywhere with the financial crisis and the rise of emerging powers.”

The U.S. is still the dominating global hegemon, but a swiftly changing world situation is taking place as Washington’s economic and political influence is declining, even as it remains the unmatched military superpower.

America suffers from low growth, extreme indebtedness, imperial overreach, and virtual political paralysis at home while spending a trillion dollars a year on wars of choice, maintaining the Pentagon military machine, and on various other “national security” projects.

The BRICS countries, by their very existence, their rapid economic growth and degree of independence from Washington, are contributing to the transformation of today’s unipolar world order — still led exclusively by the United States — into a multipolar system where several countries and blocs will share global leadership. This is a major aim of BRICS, which recognizes it’s a rocky, long road ahead because those who cling to empire are very difficult to dislodge before they swiftly disintegrate.

Looking down that road the next few decades, it is imperative to contemplate two potentially game-changing events that will heavily impact global politics, and the future of world leadership.

1. The rate of petroleum extraction will soon reach the beginning of terminal decline, known as peak oil. This means more than half the world’s petroleum reserves will have been depleted, leading inevitably to much higher oil prices and severe shortages. Under prevailing global conditions, this will greatly exacerbate tensions between major oil consuming countries leading to wars for energy resources.

One resource war already has taken place — the Bush Administration’s bungled invasion of Iraq, which possesses the world’s fourth largest reserves of petroleum and tenth largest of natural gas. Since the U.S. with less than 5% of world population absorbs nearly 30% of the planet’s crude oil, who’s Washington’s next target — Iran? Behind the U.S.-Israeli smokescreen of alleged Iranian aggression and supposed nefarious nuclear ambitions, reposes the world’s third-largest proven oil reserves and second-largest natural gas reserves.

In 2009, the U.S.,with a population of 300 million, consumed 18.7 million barrels of oil a day, the world’s highest percentage. The second highest — the European Union with a population of 500 million — consumed 13.7 barrels a day. China with a population of 1.4 billion people was third, consuming 8.2 million barrels. BRICS, incidentally, includes the country with the world’s first largest natural gas reserves, Russia (which is also eighth in petroleum reserves).

2. Equally dangerous, and perhaps much more so, is the probability of disastrous climate change in the next few decades, the initial effects of which have already arrived and are causing havoc with weather patterns. This situation will get much worse since the industrialized world, following slothful U.S. leadership, has done hardly anything to reduce its use of coal, oil and natural gas fossil fuels that are mainly responsible for climate change.

Another climate question is whether the capitalist system itself is capable of taking the steps necessary to dramatically reduce dependence on greenhouse gas emissions as the socialists maintain. Eventually, under far better global leadership, some serious action must be taken, but the damage done until that point may not be rectified for centuries, if not longer. The question of better global leadership depends to a large degree on the outcome of the unipolar-multipolar debate.

Returning to the immediate problem, Washington not only opposes BRICS’ preference for multipolarity, but is disgruntled by some of its political views. For instance, the group does not share America’s antagonism toward Iran — President Barack Obama’s whipping boy of the moment. BRICS also lacks enthusiasm for America’s wars in Central Asia and the Middle East and maintains friendly relations with the oppressed Palestinians. The five nation emerging group further leans toward replacing the U.S. dollar as the world’s reserve currency with a basket of currencies not preferential to any one country, as is the present system toward the U.S., or perhaps even a non-national global reserve legal tender.

For a small group —though it is symbolic of a large trend in world affairs — BRICS will have considerable clout this year as members of the UN Security Council occupying five of 15 seats — temporarily for Brazil (until the end of 2011), India and South Africa (ending after 2012), and permanently of course for China and Russia.

BRICS as an organization had a most unusual birthing. The group was brought into the world, so to speak, without the knowledge of its members. The event took place in 2001 when an economist with the investment powerhouse Goldman Sachs created the BRIC acronym and identified the four countries together as a lucrative investment opportunity for the company’s clients based on the enormity of their combined Gross Domestic Products and the probability of increasing growth.

Neither Brazil, Russia, India nor China played a role in this process, but they took note of their enhanced status as the BRICs and recognized that they shared many similarities in outlook as well as significant differences in their types of government and economic specialties.

The main similarity was that they were emerging societies with growing economies and influence, and they viewed Washington’s unilateral world leadership as a temporary condition brought about by accident two decades earlier due to the implosion of the Soviet Union and most of the socialist world. They all seek a broader, more equitable world leadership arrangement within which they and others will play a role.

At the initiative of Russia’s then-President Vladimir Putin in 2006, BRIC began what became regular meetings at the ministerial level that evolved a couple of years later into what is, in effect, a political organization. There are some differences and rivalries within its ranks that have been kept within bounds, such as between China and India (which is also close to the U.S.), and to a lesser extent between Russia and China. Brazil and South Africa are everyone’s friends.

All five BRICS states — three of whom possess nuclear arsenals — maintain essentially cordial relations with the U.S. and try to avoid antagonizing the world superpower.

Despite productive working relations between the U.S. and Russia, Moscow justly perceives Washington to be an implicit threat that seeks to neutralize — if it cannot dominate — it’s now reviving former Cold War opponent. The Russian leadership seems to view the U.S. as a strategically declining imperialist power, perhaps all the more dangerous for its predicament.
The Chinese government, while standing up for its rights when challenged by the U.S., is especially cautious because America’s military power at this point is overwhelmingly superior to its own in all respects. It’s trying to catch up in terms of defense, but it will take many years.

The Chinese Communist Party and government are primarily focused, as they have been for decades, on the creation of a modern, advanced, educated and 70% urban society of some 1.4 billion people. The national plan is to achieve this goal by 2030, based on economic growth (China is now the world’s second largest economy, heading toward first within 15-35 years), political stability at home (which will soon require substantial social reforms to facilitate), and a foreign policy of nonintervention and friendship between nations.

The Beijing leadership is evidently uncertain whether the U.S. decline is temporary or long term and does not officially comment on such matters in line with its foreign policy perspective.

Just before the start of 3-day talks in Beijing regarding U.S.-China military relations, Defense Secretary Robert Gates told the New York Times January 8 that the Obama Administration was so concerned about Beijing’s “military buildup in the Pacific” that the Pentagon was now increasing spending on such weapons as an advanced “long range nuclear-capable bomber aircraft,” among other measures.

Responding to Gates’ comment two days later at a joint press conference, Chinese Defense Minister Gen. Liang Guanglie said the U.S. “was overreacting” to an effort to modernize. “We can by no means call ourselves an advanced military force,” Liang said. “The gap between us and that of advanced countries is at least two to three decades.” This cannot be honestly disputed.

The newspaper also paraphrased Gates as saying during his visit that “if Chinese leaders considered the United States a declining power… they were wrong.” He was then directly quoted: “My general line for those both at home and around the world who think the U.S. is in decline is that history’s dustbins are filled with countries that underestimated the resilience of the United States.” Last August, it should be noted, two-thirds of the America people queried told an NBC News/Wall Street Journal poll they think the U.S. is in a state of decline.

While Gates dwells upon Beijing’s “buildup,” the U.S. virtually encircles China with military bases, submarines, fleets at sea, spy satellites, long-range nuclear and conventional missiles, offensive weapons many years in advance of Chinese defenses, overwhelming airpower, plus alliances with Japan and South Korea in Beijing’s vulnerable northeast, Taiwan, Australia, the Philippines, Thailand, Indonesia and India. The U.S. spends over 10 times more on the military than China. It operates up to 1,000 large and small military bases around the world, while China has no foreign bases.

The Obama Administration is presently fishing in the troubled waters of the South China Sea, intervening in territorial disputes between China and neighboring countries, including Vietnam, much to Beijing’s chagrin.

It is precisely this kind of “leadership” that BRICS and a number of emerging nations want to change.

The addition of South Africa was a deft political move that further enhances BRICS’ power and status. The new member possesses Africa’s largest economy, but as number 31 in global GDP economies it is far behind its new partners, nearly by 20-1 in China’s case. It’s also behind such other emerging countries as Turkey, Mexico, and South Korea, for example — but African credentials are important geopolitically, giving BRICS a four-continent breadth, influence and trade opportunities. China is South Africa’s largest trading partner, and India wants to increase commercial ties to Africa.

Johannesburg sought BRIC membership over the last year, and as early as August the process of admission was underway, but now as a member it must take serious steps to substantially hasten its economic development to keep pace with other BRICS members. This will not be easy, but it is assumed the partners will help out.

A Chinese Foreign Ministry spokesperson declared: “We believe that South Africa’s accession will promote the development of BRICS and enhance cooperation between emerging economies.” Russia’s Foreign Ministry statement said South Africa “will not only increase the total economic weight of our association but also will help build up opportunities for mutually beneficial practical cooperation within BRICS.”

Brazil’s Foreign Ministry, in addition to the conventional welcoming, interjected a sharp political note into this economic club by suggesting that “on the international level” BRICS would work “to reform the financial system and increase democratization of global governance.” The reference was to Washington’s dominant authority over global finance and its unipolar leadership. This is bound to further irritate Washington.

India, like South Africa a former British colony and now a swiftly developing country, cannot conceivably oppose Johannesburg’s admission for obvious reasons, but has so far remained publicly silent since the December 24 announcement. India’s unexpected quietude is of interest because last August Indian High Commissioner Virendra Gupta commented that “India of course remains extremely supportive of South Africa joining BRIC.” The Indian foreign office is too sophisticated to have forgotten the expected routine welcoming.

Maintaining good ties with Washington, which is disturbed by South Africa’s membership, is one of New Delhi’s main considerations. The United States has been courting India for some time, offering various rewards — from help with its nuclear program (and silence about its violation of the nonproliferation treaty) to supporting India’s quest for a future Security Council seat (which China opposes and Russia supports). The purpose is to attract India more deeply into Washington’s orbit, undercutting Beijing’s increasing global influence, and perhaps setting the two against each other.

Global Trends 2025 even envisioned possible “great power rivalries and increasing energy insecurity” between India and China that may lead to a serious confrontation “though great power war is averted.” In the process, “United States power is greatly enhanced. ”

Regardless of BRICS and other emerging economies, President Obama’s principal foreign policy objective since assuming office has been to reassert American global leadership after the Bush Administration’s neoconservative imperialist wars and unilateralism weakened Washington’s alliances and compromised its hegemony. This is what Obama was elected to do — not, by rank-and-file Democrats cocooned in “change we can believe in,” but by the representatives of great wealth, great corporations and great financial power.

The Obama Administration’s first National Security Strategy report, released in May 2010, makes it clear that “Our national security strategy is… focused on renewing American leadership so that we can more effectively advance our interests in the 21st century.” In discussing world economies, which correlate to global leadership in Washington’s view, President Obama declared in his State of the Union Speech last year that “I do not accept second place for the United States of America.”

As part of this policy the U.S. seeks to forestall the development of a genuine multipolar system by making limited concessions to the emerging nations that will that leave Washington in charge for many years.

Washington’s latest scheme, introduced a year and a half ago by Secretary of State Clinton, is the so-called, “multi-partner,” not “multipolar,” world — suggesting the Obama Administration’s intention is to serve as “senior” partner of a global leadership “coalition of the willing,” as it were, that will in effect strengthen Washington’s singular role.

“We will lead,” Clinton told the Council on Foreign Relations, “by inducing greater cooperation among a greater number of actors and reducing competition, tilting the balance away from a multipolar world and toward a multi-partner world. Now, we know this approach is not a panacea. We will remain clear-eyed about our purpose. Not everybody in the world wishes us well or shares our values and interests. And some will actively seek to undermine our efforts. In those cases, our partnerships can become power coalitions to constrain or deter those negative actions.”

The U.S. also gives verbal support to an eventual expansion of the Security Council, and has cooperated in extending the powers of emerging countries within the Group of 20 leading industrialized economies, in the World Bank and IMF. In addition the State Department seeks one-to-one arrangements advantageous to certain countries to keep them well within the U.S. sphere of influence.

Washington intends to function as the principal world power for as long as it can. After all it is still an enormously wealthy, militarized state with powerful and obedient industrialized allies including the European Union countries (and NATO), the UK-Australia-Canada-New Zealand nexus, Japan, South Korea, Taiwan and others.

However, the ongoing global diversification of economic and political resources toward the emerging countries appears to be leading inevitably to multipolarity. To quote “Global Trends 2025″ once again:

The unprecedented transfer of wealth roughly from West to East now under way will continue for the foreseeable future…. Growth projections for Brazil, Russia, India, and China indicate they will collectively match the original G-7’s share of global GDP by 2040-2050. China is poised to have more impact on the world over the next 20 years than any other country. If current trends persist, by 2025 China will have the world’s second largest economy and will be a leading military power.

Actually China became the second largest global economy last August, 15 years before 2025.

Under such conditions, how many newly empowered emerging countries will remain content simply to play follow-the-leader behind a faltering and militarist Uncle Sam?

The time of decision about the architecture of future world leadership draws nearer. At some point in 10 or 20 years a reluctant Washington may have to settle for a prominent position in a multipolar world construct.

But, of course, there remains another possibility.
Given the volatile global situation — peak oil, climate change, continued U.S. imperial wars, grave poverty that will increase as world population grows from 6.8 billion today to over 9 billion in 2050, and many emerging countries seeking a rightful share of world leadership — the Unites States may resort in time to global military aggression to sustain its dominant status, possibly even World War III.

Considering the U.S. political system’s decades-long move toward the right, the enormity of the Pentagon’s arsenal, the militarism in our society, and the ability of Washington and the corporate mass media to collaborate in “selling” wars to a misinformed public, this cannot be ruled out.

It is impossible to predict how all this will turn out. What is known is that the American people still have the power to make their own history. This is not so much a question of voting — for whom, in this case? — but of taking action to galvanize the masses of people to oppose the political structure’s penchant for wars and global domination, for inexcusable foot-dragging on climate change and indifference to gross economic inequality.

Jack A. Smith is editor of the Activist Newsletter and a former editor of the Guardian (US) radical newsweekly. He may be reached at: jacdon@earthlink.net. Read other articles by Jack.