Thursday, August 14, 2008

Playing catch up 2, 3, 4

The global financial mess: blaming the victims by Ann Pettifor

"The stupidity, poor economic analysis and sheer ignorance of those - central bankers, politicians, auditors - that have a duty to act as guardians of the nation's and the world's finances has had and will continue to have very grave consequences for the whole of the global economy, but also for millions of individual and corporate borrowers.

Their conduct stems in part from a failure of economic analysis. More precisely, the economics profession has failed to correctly analyse and alert policy makers to the impact of the finance sector - and of privatised credit creation - on the global economy. Indeed the economics profession has had a (not accidental?) blindspot for the role of haute finance in the economy, while at the same time encouraging its deregulation.

Now, just as the curtain is being raised on the house of cards built by the finance sector, so a cabal of economists is working to pull it down.

Their main concern is - of course - to protect the sector from governmental or democratic oversight and regulation, and to transfer private losses to taxpayers. To do so, they need to distract attention from the sector, limit debate, prevent a coherent analysis of the causes of the crisis emerging, and blind citizens to the "science" of finance.

The first tactic in the campaign to divert attention is to blame the victims. The most hapless of these are sub-prime borrowers - people in low-paid work earning $7 an hour in the poorest districts of Ohio (for example) who were persuaded by dodgy mortgage-floggers that they could take on a adjustable rate mortgage at "teaser rates", go to the ball and have a roof over their heads."

The Shape of Cuba's Reforms by Saul Landau and Nelson P. Valdés

"The Party has not changed enough, however, to satisfy disaffected Cubans, those unimpressed by past accomplishments. 'What do past glories have with to do with the uncertainty of daily life?' they ask. Possessing quality education, high skill levels and good health, they feel they deserve good jobs. Indeed, their entire school experience from day care through doctorates has taught them self esteem and stimulated them to expect the best. But quality jobs are scarce on the island – and in most third world countries. Several Cubans in their 20s and 30s offered glazed looks to references of the revolution’s accomplishments and replied: 'I don’t see much future for myself here.' Yes, a qualified Engineer can feel frustrated making pizzas eight hours a day. Frustration can also lead some to become oblivious to the outside conditions that affect their lives. Cuba exists within the larger globalized corporate economy, possesses limited resources, and remains victim of a seemingly eternal US super embargo."

A Shattered Myth in Georgia by Brendan Cooney

"It's a good thing for Putin that Bush has already set the course of the 21st century. Bush's aggression offers him a ready analogy: 'Of course, Saddam Hussein ought to have been hanged for destroying several Shiite villages,' Putin said. 'And the incumbent Georgian leaders who razed ten Ossetian villages at once, who ran elderly people and children with tanks, who burned civilians alive in their sheds — these leaders must be taken under protection.'

None of Putin's charges has yet been confirmed, although scattered reports of Georgian aggression in South Ossetia have started to trickle in. If true, we'll want to know more about what prompted Saakashvili's cockamamie attack. Russian leaders have also suggested Georgia got the green light from the United States, another insinuation yet to be confirmed.

It's too early to draw conclusions, but it would be hard to believe Saakashvili got his swagger from anywhere other than his ex-best bud, Bush, who once thrilled thousands of Georgians by jigging to one of their folk songs. As good as Saakashvili's English is, it's not surprising he was unable to see through the fake Texas accent of the paper tiger.

When you believe fervently in a myth, you discard anything that contradicts it. You forget that the United States recently smashed the territorial integrity of Afghanistan and Iraq and now wants to do the same in Iran. You might remember that it attacked Iraq in 1991 ostensibly for the sake of Kuwait's territorial integrity. But you forget that it exercises this rationale only with weak countries, never with strong. It allows Chinese abuses in Tibet, and will stand idly by while Russia invades Georgia and massacres people for years in Chechnya.

A bully does not stand up to other bullies. Russia knows it can do what it wants on its block while another bully stamps its foot at the other end of the street.


'It was just interesting to me that here we are, trying to promote peace and harmony, and we're witnessing a conflict take place,' said Bush Monday, while he was still playing grab-ass with the athletes in Beijing. The first sitting U.S. president to attend an Olympics on foreign soil, Bush returned to the White House to deliver the following words with a straight face:

'The Russian government must respect Georgia's territorial integrity and sovereignty.'

The Georgians no longer believe. Does anyone?

Ah yes, many of us here at home still do. The Times on Sunday published an op-ed by William Kristol describing the 'aggressive powers' of the world without even a self-reflexive twitch, not even a nod at the most aggressive power of them all. It's like Parisians used to say about the ugly Eiffel Tower when it first went up—the only time you can't see it is when you're inside it."

Sunday, August 10, 2008

Playing catch up 1

Georgia Gets Its War On… McCain Gets His Brain Plaque… By Mark Ames

"The invasion was backed up by a PR offensive so layered and sophisticated that I even got an hysterical call today from a hedge fund manager in New York, screaming about an 'investor call' that Georgian Prime Minister Lado Gurgenidze made this morning with some fifty leading Western investment bank managers and analysts. I’ve since seen a J.P. Morgan summary of the conference call, which pretty much reflects the talking points later picked up by the US media.

These kinds of conference calls are generally conducted by the heads of companies in order to give banking analysts guidance. But as the hedge fund manager told me today, 'The reason Lado did this is because he knew the enormous PR value that Georgia would gain by going to the money people and analysts, particularly since Georgia is clearly the aggressor this time.' As a former investment banker who worked in London and who used to head the Bank of Georgia, Gurgenidze knew what he was doing. 'Lado is a former banker himself, so he knew that by framing the conflict for the most influential bankers and analysts in New York, that these power bankers would then write up reports and go on CNBC and argue Lado Gurgenidze’s talking points. It was brilliant, and now you’re starting to see the American media shift its coverage from calling it Georgia invading Ossetian territory, to the new spin, that it’s Russian imperial aggression against tiny little Georgia.'

The really scary thing about this investor conference call is that it suggests real planning. As the hedge fund manager told me, 'These things aren’t set up on an hour’s notice.' Where this war is leading is impossible to say, but as Iraq and Afghanistan, not to mention Chechnya, have shown, wars have a funny way of lasting longer, costing more in money and lives, and snuffing out whatever individual liberties the affected populations may have. As good as this war is for Saakashvili, who has become increasingly unpopular at home and abroad, or for McCain, whose poll numbers seem to rise every time the plaque devours another lobe of his brain, it also bodes well for the resurgent Prime Minister Putin, who seems to have become increasingly peeved with his hand-picked successor, President Dmitry Medvedev’s flickering independence and his liberalizer shtick. There’s nothing like a good war to snuff out an uppity sois-disant liberal who’s getting in your way–even McCain, frozen in an antiperspirant-induced fog, can still grasp this basic reptilian concept."

Friday, August 08, 2008

The FARC: fish with plenty of fresh water

The Continuity of FARC-EP Resistance in Colombia by James J. Brittain

This article puts recent media reports about the diminished strength and flagging spirits of Colombia's FARC rebels in perspective: reminding the reader first of all that many of these reports are issued by the Colombian government, and secondly that the FARC have faced far worse situations in the past. For instance, "[i]n 1973, the Colombian state, with the assistance of the United States, launched 'Operation Anori', which resulted in the destruction of much of the FARC-EP’s military supplies and sections of its leadership ... After this and other counterinsurgency campaigns took place during the early-mid 1970s, it was documented that the FARC-EP had lost seventy percent of its ammunitions with as little as one-hundred-fifty armed and trained combatants remaining." Yet the FARC re-grouped and gained strength.

In contrast to the conventional wisdom of an immanent FARC collapse, the article documents a number of impressive military actions occurring this very year. "Between the 29th of April and the 6th of May the FARC-EP carried out a coordinated series of attacks which isolated sectors of Colombia’s largest oil pipeline and subsequently halted the production of an estimated eight-hundred thousand to three-million barrels of oil. In addition, the guerrilla strategically destroyed important transportation routes needed to control the flow of oil and military supplies throughout various departments in the north of the country. Destroying an essential bridge near Catatumbo in the department of César, the FARC-EP was able to severe [sic] the movement of state and private security forces thereby keeping existing military units preoccupied (Weinberg, 2008). Following the offence, another Front in Norte de Santander pursued an aggressive attack against security forces guarding the 770 kilometre Colombian-based Ecopetrol and US-based Occidental Petroleum owned Caño-Limón pipeline near Tibu – the true target of the attack. Ironically, all this took place just a few short hours after William Brownfield, the United States’ Ambassador to Colombia, visited the area and applauded the growth in security and economic progress as a result of the FARC-EP’s so-called decline (Reuters, 2008a). In response to the FARC-EP’s strike, Colombian General Paulino Coronado coordinated a mounted offensive on 3rd of May to eliminate the FARC-EP attack and resume the flow of oil production. The guerrilla quickly eliminated the deployed battalion and continued their assault on the pipeline facilities for an additional forty-eight hours (Associated Press, 2008). Showing that their campaign targeting the Caño-Limón pipeline was not simply a one-time tactical success, the FARC-EP carried out an additional attack on Colombia’s largest coal mine – the Cerrejón – on the forty-fourth anniversary of insurgency’s inception."

The reason for the disparity between the FARC's continued military successes and the media-propagated conventional wisdom of FARC disintegration? It's structural: the Colombian state, along with its powerful U.S. ally, is dominating the public relations battle; how else do you think the ideas you have about Colombia originate? That there are lots of dispassionate reporters in Colombia monitoring the situation and sending accurate ideas about Colombian reality to the United States for dissemination? Not with the predominant trend in newspapers being widespread fat-trimming in the form of eliminating foreign bureaus. No, if the Colombian government is not populated entirely by idiots - and I don't think so, I'm a Unitedstatesian exceptionalist in this regard - then they've learned to deal with the media.

And that means basically driving to press offices, bringing food and visiting the landlord to pay the rent. Then the state PR flacks spoon-feed the one emaciated "reporter" who has to man the entire foreign bureau a salable story for the paper's consumers to consume. No, wait, wrong business model. It's to attract human eyeballs with brains attached to the paper so that they can be sold to the actual consumer, advertisers and their industrial and financial clients, to consume. In a gesture to credibility, the state PR goon perhaps flashes a government ID - aha, an official source! Then the ideas embodied in the story get shipped off to the U.S., where people infect themselves and others with them. This is how your ideas of Colombia - and so many other things - are made. Makes you wish you'd instead been on a tour of a health code nightmare sausage factory after weeks of continuous feasting on its products.

So while many of the ideas in your head that form your picture of Colombia are the product of government public relations flackery - and as such, by definition, have at best a troublesome correlation with reality - in Colombia the actual country the ever-present and, if anything, only intensifying disparity between rich and poor guarantees a solid base for FARC recruitment. As in Mao's analogy, the people are the water in which fish - the guerillas - swim. The Colombian and Unitedstatesian governments have unwittingly ensured that the rural poor are kept in a state where they will provide a solid base for the FARC for years to come.

"While it cannot be dismissed that in the past few months the FARC-EP has experienced unprecedented difficulties it must be realized that as long as inequitable sociocultural and political-economic conditions pervade Colombian society so too will a base from which the FARC-EP can recruit. The FARC-EP remain the longest running and most powerful political-military movement in contemporary Latin America with numbers still ranging in the thousands, arguably tens of thousands. Therefore, to buy into any suggestion that Colombia finds itself in a period of increased stability or that the FARC-EP have past [sic] into the annals of history is to adopt a false consciousness of the realities that exist within this Andean country....

'The internal struggle within Colombia is far from over. It will continue to be waged through radical and antagonistic forms. As the United States and the Uribe administration continue to engage a war against the poor so too will they exacerbate and intensify 'Colombia’s internal conflict by robbing families of their livelihoods and leaving them with little option but to join the left-wing guerrillas, particularly the FARC.'"