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By Prof. Rodrigue Tremblay
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Global Research, September 28, 2008
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The Washington gridlock about finding a solution to the subprime financial crisis in the United States is turning into a tragedy, seemingly because of a fundamental lack of understanding and communication about the causes of this financial crisis and the most efficient way to solve it. The nature of the crisis, the economic consequences if it is not solved, and how it could be solved without costing the government and U.S. taxpayers a single penny has not been properly explained to Congress and to the U.S. population. Indeed, in this election period, there is a clear danger that the financial crisis is not going to be solved properly by the U.S. government and by Congress, and that there will be dire economic consequences in the months and years ahead, not only for the United States but also for the world economy. A similar subprime crisis has been solved in Canada, without costing the government and Canadian taxpayers a single cent. Although such a solution, i.e. transforming most of the subprime mortgage-back securities into medium term debentures, would have to be adapted to the peculiar American situation, this can be done. The Canadian solution In August 2007, it was discovered that Canada, just as the U.S., had a subprime mortgage-backed securities problem. Since the Canadian economy is more than ten times smaller than the American economy, the magnitude of the problem was also smaller, but it was nevertheless acute. Indeed, Canada’s subprime mortgage market was a smaller proportion of the total mortgage market than in the U.S. and mortgage defaults have not been as prevalent in Canada as in the United States. For instance, there has not been a housing bubble burst in Canada. Overall, risky mortgage-backed paper constituted, about 5 per cent of the total mortgage market, while in the U.S., subprime mortgage paper constitutes about 20 per cent of the total mortgage market, and mortgage defaults have been rising dramatically. Nevertheless, there was some $32 billion (CAN) of non-bank asset-backed commercial paper in Canada. When this market became illiquid after August 2007, as a consequence of the global credit crisis that originated in the U.S., a restructuring committee was assembled in Canada by large pension plans, Crown corporations, banks and other businesses holding the bulk of $32 billion in non-bank asset-backed commercial paper (ABCP) in order to find a solution to the liquidity problem. (Large Canadian banks covered the asset-backed commercial paper that were on their books or in their money market funds). This was the Pan-Canadian Investors Committee for Third-Party Structured ABCP, chaired by a Toronto lawyer, Mr. Purdy Crawford, and created after a proposal that originated from the large Quebec pension fund, the Caisse de dépôt. This was the Montreal proposal. The committee ended up proposing to restructure the frozen and illiquid securities into longer-term securities. It proposed that ABCP notes, initially intended as low-risk and short-term debt, be exchanged for new replacement notes or debentures that would not mature for years (seven or nine years) while earning interest originating from the underlying primary mortgages. The plan was approved by a Canadian court last June and is scheduled to close by September 30, after Canada’s Supreme Court refused to hear an appeal against the plan. The plan was designed to prevent a forced a fire sale of the asset-backed paper and to restore confidence in the Canadian financial system, especially in the money market funds. And it did all that without the government risking a penny of taxpayers’ money. Of course, those entities that had invested in what they believed to be liquid and relatively high-yield 30- to 90-day debt instruments had to accept new notes maturing within nine years, but most of them thought that this was better than the alternative of outright liquidation. Those investors can hold the newly-issued notes to maturity or they can try to trade them in the secondary market. A market for asset-backed securities was thus indirectly created where none existed before. What lesson can be drawn for the current U.S. predicament? The U.S. Problem: Real danger of a cascading debt-deflation spiral The financial crisis is much more severe and much more widespread in the U.S. than in Canada. Therefore, a large scale Canada-like solution would have been, most likely, unrealistic. Could hundreds of American banks and pension funds get together to restructure the illiquid mortgage-backed paper? This is doubtful. However, the principles behind the Canadian solution can be retained and the mortgage-backed securities could be restructured into longer-term securities carrying interest. But because of the size and complexity of the American financial system, this would have to involve the U.S. government as an intermediary. In the U.S., for example, the mortgage market (residential and commercial) is about $14 trillion, that is a size equal to the annual gross domestic product (GDP). Overall, the U.S.’s total interest-bearing debts are now a staggering $51 trillion (consumer, corporate and government debt), that is to say a level of total debt more than three and a half times the annual GDP. For decades in the past, the ratio of debt to GDP was about 1.0. This shows the extent of American current over-indebtedness. In the short run, however, there are two urgent problems faced by the U.S. economy that must be solved with as little economic perturbation as possible. First, there is the most urgent problem of solving the overhang of illiquid mortgage-backed securities which were created as the equivalent of liquid commercial paper. They must be urgently aligned more closely with the more long term mortgages downstream they are based on. Since much of this illiquid mortgage-backed paper is found in the $4 trillion money market funds market, there was and there still is the danger of a run on such funds in the coming days and weeks if investors fear for the safety and liquidity of their balances. A collapse of the market in money market funds would be equivalent to the banking collapse of the 1930’s, since this is where companies park most of their required cash flows in the short run. The second American financial problem is related to the approximately $2.7 trillion in municipal securities outstanding, a large proportion of which have been relying on a bond insurance system that is teetering on the brink of collapse. The U.S. Treasury partly solved this problem temporarily when it announced on Tuesday, September 16, that it had loaned $85 billion (for two years) to the largest world insurance company, American International Group (AIG), in exchange for a 79.9 percent stake in the company, thus avoiding a formal bankruptcy filing for AIG. This was, of course, after announcing that the U.S. Treasury promised to inject some $200 billion in the government sponsored Fannie Mae and Freddie Mac in preferred shares, in order to solidify their mortgage lending operations and their $5.3 trillion joint debt. The Bush administration’s proposal to create a fund of $700 billion to buy back illiquid mortgage-backed paper does not seem to have been structured in a manner that would avoid an outright subsidy to the American banking sector. If it were to be used to recapitalize private banks, this amount would be too small. This need not be. In fact, much of the legitimate fear that many Americans have that large amounts of public money are going to be used to subsidize Wall Street firms can be avoided, and the amount required to restructure the subprime-based securities market could be considerably reduced. Indeed, there is a way for the U.S. Treasury to play an intermediary role in restructuring most of the illiquid mortgage-backed paper that creates so many problems today, not the least would be the possible collapse of large segments of the U.S. financial system. Since time is of the essence, Congress could approve the creation of a U.S Government Mortgage Restructuring Trust (MRT), designed to exist for a twelve-year maximum period, that is, until 2020. Such a government trust could buy back, at a fair market value (including a substantial discount to reflect poor liquidity and poor marketability), illiquid but still solvent mortgage-backed securities, held by banks or money market funds. Simultaneously, the government trust would have the power to reissue mortgage-backed debentures with a maturity of nine years or less and carrying interest financed by the underlying mortgages thus acquired, and in an amount large enough to cover at least the initial cost of acquisition. The Fed and its twelve regional banks, plus Fannie Mae and Freddie Mac, could play an important role in creating a liquid secondary market for such government-backed securities. Because of this reissuance feature, the $700 billion guarantee initially proposed by Sec. Henry Paulson could be reduced, possibly to a more palatable level of $250 billion. Such an operation would relieve the U.S. banking system from short-term mortgage-backed securities that are presently de facto frozen, because there is no market for them. It would also allow American savers and investors to include in their IRAs or 401(k) plans safe and profitable investments. Moreover, it would provide capital to the mortgage market and help turn the housing slump around. And, what’s more, such a debt restructuring operation need not cost the government and American taxpayers a single penny, in the end. To the contrary, the program can be structured in such a way as to generate a fair return on the government’s initial investment. Simultaneously, a regulatory ban on the issuance of any new securitized mortgage-backed paper could be issued. The same could apply also to the dangerous practice of elevating the credit rating of certain bonds or debentures through reliance upon the credit-default (insurance) market. These were the two main corrosive “innovations” which have resulted in the present financial mess. Moreover, such a restructuring plan could be kept simple and totally transparent. In conclusion, this is something that the Bush administration and the U.S. Congress might want to consider if they hope to get out of the ideological and political deadlock they have talked themselves into.
He is the author of the book ‘The New American Empire’. Visit his blog site at |
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Archive for September, 2008
Tragedy in the Making in Washington and on Wall Street: the Canadian solution
Grand Theft America
This is a great piece on the current economic situation facing the US.
http://www.globalresearch.ca/index.php?context=va&aid=10364
Financial Crime of the Century
By Stephen Lendman
Global Research, September 29, 2008
The world as we know it is changing. Industrial capitalism. The entire global economic system. Interconnected. What affects one nation touches others. If the troubled country is America it reaches everywhere, and if the crisis is great enough, the disease may be fatal and human wreckage catastrophic. Precisely the current dilemma that world leaders and financial experts are scrambling to figure out. Desperate to contain, and not sure what, if anything, can work. How did this happen and why?
The result of unfettered capitalism’s fatal flaw – unbridled greed in a rigged system that rewards the few at the expense of most others. First an explanation of how it works. Free-wheeling, “free market” Chicago School fundamentalism the way economist Milton Friedman championed it in his 1962 book “Capitalism and Freedom” and taught it to students for decades. He believed that government’s sole function is “to protect our freedom both from (outside) enemies….and from our fellow-citizens.” Preserve law and order. Enforce private contracts. Protect private property and “foster competitive (unregulated) markets.” Everything else in public hands is “socialism….blasphemy.” Not to be tolerated.
He said “free markets” work best. Unfettered by rules, regulations, onerous taxes or any at all, trade barriers, entrenched interests, and human interference. That anything government does, business does better, so let it. That the best government is one that governs least. That public wealth should be in private hands. The accumulation of profits unrestrained. Corporate taxes abolished. Social services also, and that “economic freedom is an end to itself….and an indispensable means toward (achieving) political freedom.”
He called most all government interference a restriction of freedom. Opposed foreign aid. Subsidies. Import quotas and tariffs, and illicit drug laws for being a subsidy to organized crime, but he found no fault with major banks laundering their profits. He believed business should be unrestrained in maximizing them, even the illegal kind apparently.
He opposed the minimum wage and right of unions to bargain collectively on equal terms with management. He believed high wages and benefits harm everyone. They raise prices, and in the end, hurt workers as well as management. He called Social Security “The Biggest Ponzi Scheme on Earth,” even though it’s been the most effective poverty reduction program ever for millions of seniors who’d be desperate without it. Especially today given a deepening economic crisis. The nation’s social safety net disappearing, and heading everyone toward managing on his or her own. Dependent on their ingenuity, resources, and good fortune. Milton Friedman’s ideal world. For those who can’t make it, it’s their own fault. It’s everyone for him or herself in his judgment, and let the devil take the hindmost.
As for today’s largest ever unraveling Ponzi scheme, it’s just the workings of the “free market.” Creative destruction. “Freedom to choose.” The best of all possible worlds, and unfettered capitalism will figure out the right solutions. Provided government gets out of the way and gives it free reign. Free money also to wreck world economies and human lives even more than what’s already done.
The Chickens Are Home to Roost
Are they ever, and here’s what we’ve got. A global asset bubble. A predictable crisis allowed to build and mushroom. Begun after Chicago School economics took hold under Ronald Reagan. Continued under GHW Bush. Became religion under Bill Clinton, and ultimately fundamentalism under GW Bush.
The result – a “slow motion train wreck” gaining speed. Banks and other financial institutions failing globally. On September 25, the largest bank failure in US history with Washington Mutual’s collapse. Earlier it was giant insurer AIG. Before that Fannie Mae and Freddie Mac, Lehman Brothers, Bear Stearns, and Merrill Lynch a forced liquidation to Bank of America.
Others are now teetering on the edge. Strapped by toxic debt. The result of out-of-control greed for easy profits. Massive fraud to get them. Thinking they’re the best and brightest, and only mere mortals mess up. Knowing Fed moral hazard will cushion them if they do. True for some. Not for others, and learning that the Federal Reserve (the world’s key central bank) failed in its primary job. To protect the country’s financial system from insolvency. By contributing to a financial crisis and one of confidence. By creating near-limitless amounts of capital. Fueling a housing bubble. Outsized consumer debt, and irresponsible investments free from government oversight. Fraudulent ones involving multi-trillions of dollars.
Partnering with government to make it easy. Risking a global economic meltdown as a result. Scrambling to find solutions. Unsure if there are any. The present crisis is unparalled. Maybe it can be fixed, and maybe not. The problem is multi-fold. A perfect storm involving:
– residential housing;
– commercial real estate;
– consumer over-indebtedness;
– unknown amounts of toxic debt (in the multi-trillions);
– affecting world finance and economies;
– causing bankruptcies;
– many more will follow;
– selected ones bailed out;
– the entire system endangered;
– consumer money market, bank accounts and private pension funds as well; government backing is needed to protect them; there’s not enough money to do it; and
– the contagion is spreading; threatening world economies and people everywhere.
This time is really different. A $700 billion bailout (called the Emergency Economic Stabilization Act of 2008 – EESA) is just a down payment. Trillions will be needed in the end. Other nations contributing to help. The problems are deeper and more intractable than anyone expected. Before this ends, unimaginable amounts of capital will be written off. Too much to even contemplate. Bad investments contaminating good ones. Threatening world financial structures with paralysis. Severe economic damage to their economies as a result.
Eroding industrial capitalism as we know it. At best managing a short-term fix and delaying a final denouement for a later time. Under new management with the current and past ones claiming no responsibility. And unmindful of millions of homeowners facing foreclosure and bankruptcy. One in ten currently behind in their payments. Others losing their jobs and way of life. They’re the most vulnerable. Least able to cope, and for some their ability to survive.
According to The New York Times, here’s how the Paulson scheme helps them: “it requires the government to use its new role as owner of distressed mortgage-backed securities to make ‘more aggressive’ efforts to prevent home foreclosures.” Weasel words. No specifics. No assurances, and nothing apparently for homeowners already in foreclosure.
On September 22, ahead of the announced agreement, American Research Group (ASG) published its latest public sentiment poll results, and they were stunning. At 19%, George Bush scored lowest ever for a US president, surpassing Harry Truman at the depth of the Korean War and Richard Nixon during Watergate. It came at a time ASG’s results showed 82% of Americans believe the economy is getting worse, and only 17% approve of how Bush is handling it. Among registered voters, the number is 18% at a time no one surveyed (zero percent) said the economy is improving and 68% say it’s in recession. True or false, it’s how they feel. How the crisis affects them, and that’s what counts most.
Yet on September 24, the president addressed the nation audaciously. Callously dismissing public pain and anger. Deceitfully stating outright lies. A typical performance. Demanded that Congress give the treasury secretary carte blanche authority over $700 billion to address “a serious financial crisis.” Asked taxpayers to pay for corporate fraud. Reward criminals and ignore their crimes. Said nothing about the root cause. The effect on ordinary people, or how Paulson’s scheme will help them. Ignored growing public opposition. Large numbers of credible observers believing the proposed solution is worse than the problem. The most honest of them saying it will enrich fraudsters and offer no help for homeowners.
Yet Bush concluded that “democratic capitalism (is the) best system the world has ever devised” in spite of clear evidence that it’s broken and corrupted. Exploits people for profit. Enriches the few at the expense of the many. Rewards criminals for their crimes. Protects the rich from beneficial social change.
Ahead of the president’s address on September 24, The New York Times showed a rare display of candor in a critical Timothy Egan opinion piece. About “nearly nationalizing the banking system and giving the treasury secretary more power than a king….whose decisions may not be reviewed by any court of law or any administrative agency.” He asked readers to remember “where the biggest heist took place, and how Wall Street dragged down the rest of the country once before,” referring to the Great Depression but leaving out everything in between.
He stressed, however, “how Wall Street brought down main street,” and things have now come full circle. Deregulation unleashed casino capitalism, and bankers made a killing. Now they’re in trouble and Bush demands “the biggest bailout in American history….or the world will crumble. He said the a similar thing in the run-up to war” so who can believe him now. Egan quotes a dirt farmer asking why not the same “concerns (for) average Americans.” Because “we the people” Bush speaks for are them, not us.
As for Paulson’s plan, here’s what the Financial Times writer Martin Wolf said on September 23. He called it “not a true solution to the crisis.” It doesn’t address the “fundamental problem.” It’s “neither a necessary nor an efficient solution. It is not necessary because the (Fed can) manage illiquidity through its many lender-of-last resort operations. It is not efficient because it can only deal with insolvency by buying bad assets (overpriced junk) at far above their true value, thereby guaranteeing big losses for taxpayers and providing an open-ended bail-out to the most irresponsible investors.”
Wolf also objects to Paulson getting unchecked powers. Providing little or no help to the poor and “ill-informed” (read duped) borrowers, and lists other operational suggestions “essential for the long-run health of any financial system” without needing “a penny of public money.” Among them, forcing creditors to take losses and not taxpayers.
Unmentioned in his article is the underlying fraud behind the crisis and a lack of regulatory oversight that made it easy. Also, omitted was what’s covered in the section below.
The 1937 Housing Act’s Empowering Section 8 Authority
One Section 8 sentence provided the basis for the treasury secretary’s empowerment. It reads:
“Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administration agency.”
In other words, unchallengeable czarist powers. In contrast to the 1930s Reconstruction Finance Corporation’s (RFC) closely supervised operations. That era’s Home Owners’ Loan Corporation (HOLC) that refinanced homes to prevent foreclosures. And the 1980s Resolution Trust Corporation (RTC) mandate to liquidate assets from failed S & Ls. Not dispense free money for bad investments unchecked. The above authorities subject to judicial review. Not governed by a financial boss to run as he pleased.
The Announced “Bailout” Deal – The Emergency Stabilization Act of 2008 (ESA)
According to The New York Times, EESA calls for “strict oversight of the program by a Congressional panel and conflict-of-interest rules for firms hired by the Treasury to help run the program.” Also “a change in the bankruptcy laws sought by some Democrats to give judges the authority to modify the terms of first mortgages.”
Given the bipartisan blame for today’s crisis. The post-9/11 willingness to give the administration near-carte blanche authority across the board. Eight years of indifference to social needs and public welfare. Who now believes that policy going forward will change and that the agreed-on scheme will protect people or curb the secretary’s authority. On his own initiative, George Bush usurped supreme power post-9/11 while few in Congress blanched. None in leadership positions. Little today has changed.
Disclaimers notwithstanding from both sides of the aisle, Wall Street is pleased. Paulson got what he wanted. The plan’s fine print will assure it. Public money. Far more, if needed, than $700 billion. The power to dispense it freely. With weak at best oversight and judicial review, and the ability to conceal fraud and malfeasance. In short, the between-the-lines meaning of Paulson saying: “We have made great progress toward a deal, which will work and be effective in the marketplace.”
The same one that fleeced the nation and betrayed the public trust. Now empowered to take more with the full faith and blessing of the government from both sides of the aisle. Belying George Bush’s insult that “The rescue effort….is not aimed at Wall Street; it is aimed at your street.” And Nancy Pelosi’s hypocrisy that: “All of this was done in a way to insulate Main Street and everyday Americans from the crisis on Wall Street….I want to congratulate all of the negotiators for the great work they have done.” Who in banker boardrooms would disagree.
Some Relevant Facts
Clearly the present crisis is unprecedented. As stated above, maybe it can be fixed and maybe not. No one is sure because no one understands it fully. Where all the problems lie. To what degree can they be contained. How great their fallout may be. Their full effect on world economies. How bad things may get before they stabilize and improve, and the way the world will look like when they do.
Whatever’s coming, industrial capitalism is eroding. A kleptocracy replaced it. If the system is saved, it will be temporary, and an even greater one will emerge. Why this article is called Grand Theft America. A criminal class runs it, and they’re rewarded for their crimes. Backed by the full faith and credit of the government with taxpayer money. A near-limitless amount created and borrowed. Who said crime doesn’t pay!
For over 30 years, an unimaginable wealth transfer to the rich has been ongoing. To the top 1% and corporate America from most others. It proves the failure of a system that rewards the few at the expense of the many. Licenses greed and creates this kind of global financial crisis so far uncontained. It begs the questions: what caused it and what’s the fallout:
– the ruinous effects of militarization; insane amounts of spending on it; “military Keynesianism;” believing capitalism thrives on foreign wars; “Global Wars on Terrorism” currently; their costs are unsustainable and are heading the nation toward bankruptcy;
– the drain on an already weakened economy;
– maxed out consumers now debt slaves;
– so is government from unrepayable obligations in the tens of trillions; not the fictitious “official” reported numbers;
– the possibility of future default; hyperinflation; national bankruptcy, and the demise of the republic;
– human default as well: mass bankruptcies; home foreclosures; rising unemployment; increased poverty; and growing numbers of families unable to survive;
– the subprime crisis is just part of it; seven million mortgages sold to the unwary; the idea was to criminally defraud them; offer two-year teaser rates; then reset them higher semi-annually based on an interest rate benchmark; payments soared as much as 30% and became unaffordable; the scheme was to cash in at the expense of mortgage holders, and five million risk losing their homes and life savings;
– an “economic Pearl Harbor” for Warren Buffett; for Senator Chris Dodd a “50-state Katrina;” a “house of cards (built on) reckless finance” for author Kevin Phillips; Frankenstein finance; casino capitalism; for most Americans, a human catastrophe;
– the demise of our manufacturing base; letting malls replace factories as the economy’s engine;
– permitting the financialization of the economy; speculative finance writ large; replacing productive investment; totally deregulated; run by fraudsters; free from government oversight; letting investment banks game the system at up to 40 to 1 leverage; until 2004, 12 to 1 was the maximum;
– a government – business conspiracy for global dominance and the single-minded pursuit of profit; unfettered amounts of it through cleverly manipulated schemes; transferring multi-trillions of dollars from workers to the most wealthy; doing it without people even noticing;
– creative destruction to let giant businesses grow larger by removing and devouring smaller ones; even large ones;
– permitting and/or ignoring massive fraud; involving multi-trillions of dollars; the largest ever Ponzi scheme; a calculated crime with media complicity through silence; not reporting a growing problem as it emerged; waiting until it mushroomed and still not explaining it accurately and honestly; and
– wondering won if the best and brightest can fix things or if no amount of money or ingenuity can do it.
The Plan’s Architect – Henry Paulson
From a Nixon administration staff assistant to the assistant secretary of defense. To assistant to key Watergate official John Erlichman. To Goldman Sachs in 1974. To a partnership in the firm in 1982. Then Chief Operation Officer (COO) in 1994 and CEO in 1998 by a palace coup against co-chairman and now New Jersey governor Jon Corzine, according to New York Times columnist Floyd Norris.
Even before the current crisis, Goldman was the preeminent Wall Street firm. A survivor. The largest, and along with Morgan Stanley, the remaining two Street giants left standing. But no longer as investment banks after the Federal Reserve’s September 21 announcement that both companies will become bank holding companies after a mandatory five-day waiting period, now over.
In theory, they’ll be under stricter Fed oversight but will get Fed help to complete their transition and thereafter. As a well-connected financial powerhouse, whatever Goldman wants, Goldman gets. Always in the past by recycling top executives into Democrat and Republican administrations, and now more than ever given Henry Paulson’s extraordinary financial czar powers.
Before his $700 billion giveaway plan, the 2008 Housing and Economic Recovery Act gave him authority to fleece taxpayers by rescuing Fannie Mae and Freddie Mac as well as raise the national debt by over $5 trillion dollars. He also orchestrated the demise of Bear Stearns, Lehman Brothers and Washington Mutual. The forced sale of Merrill Lynch, and arranged the government takeover of AIG.
He has near-open checkbook authority to reward close allies with loans and free money and let them acquire troubled assets on the cheap. This from a man with much responsibility for today’s crisis. A June 12, 2006 Business Week cover story titled “Mr. Risk Goes to Washington” called him “one of the key architects of a more daring Wall Street, where securities firms are taking greater and greater chances in their pursuit of profits.” Such as assuming huge amounts of debt and “placing big bets (with their own money) on all sorts of exotic derivatives and other securities.” Advising clients to do the same. Casino capitalism at up to 40 to one leverage. Hugely profitable in up markets. Disastrous in down ones.
Paulson earned millions and now has an estimated $700 million + net worth. For 2007 overall, according to Bloomberg.com, “Wall Street’s five biggest firms (paid out) a record $39 billion in bonuses (and did it in) a year when three of the companies suffered the worst quarterly losses in their history and shareholders lost more than $80 billion.”
Speculative finance pays well, even in down years, and it even raised Bloomberg’s ire in a Michael Lewis September 24 commentary titled “America Must Rescue the Bonuses at Goldman Sachs.” It reflected on a possible global financial collapse but sacrificing Goldman bonuses is another matter. If firm “employees (take) pay cut(s), it will be (tantamount to failure and) our country may never recover.” How will the company induce new talent to come aboard. Goldman is well-positioned to get maximum gain from its former CEO’s $700 billion handout.
Why else would Warren Buffett bet $5 billion on the firm! For preferred shares paying an annual 10% dividend. Warrants as well to buy $5 billion in common stock at a $115 a share strike price. Well off its $251 peak and below the latest September 26 $138 a share.
Joseph Stiglitz on the Economy
Stiglitz was formerly part of the system he now criticizes. Free market fundamentalism in its most extreme form. For many months, he warned about a worsening global economy and growing financial crisis that’s as bad or worse than the Great Depression.
He sees similar problems now as then:
– outsized speculation through excessive leverage;
– pyramid schemes;
– multiple bubbles through so-called Wall Street innovations; and
– a lack of transparency and government oversight.
Combined they created a crisis “so great that no one knows exactly the magnitude of the risk they face. It is particularly bad because our financial institutions are based on trust. You put money in the bank and you trust that you can get (it) out, so trust is absolutely essential for the functioning of our financial markets and economy.”
The problem is exacerbated by those providing the news. The dominant media and frequent spokespeople. Industry representatives like Lehman Brothers CEO saying last April that “we turned the corner, and the economy is on the uptick.” Also from the president, treasury secretary and others in government as things keep worsening.
Stiglitz calls this a “top down crisis.” The “$3 trillion cost” of foreign wars a key. Creating huge deficits and consuming vital resources needed for growth. “This is the first war in American history that has been totally financed on the credit card. For the last five years….we have been a debt economy.” Not since the Revolutionary War have “we have had to turn to foreigners,” so now “40% of our national debt is financed by (them). Even as we went (to war) we had a big deficit, and yet the president called for tax cuts for upper middle class Americans.” Insane but we did it.
Another factor is other countries trusting that our economy is working well, and when the president says it is he’s believable. “This administration burned that trust….no wonder everybody around the world is losing confidence.” Even worse is that the administration isn’t dealing responsibly with these problems, mostly because they’re of our own making.
Stiglitz worries about the “real economy:” home prices dropping; owners forced into foreclosure; more financial firms in crisis; and a good many won’t survive. He sees a weakening financial system unable or unwilling “to provide credit (the lifeblood of the economy for) loans, mortgages,” and that means lower home prices, contracting businesses, rising unemployment, and a “downward vicious cycle. You have to be in fantasy land to say that everything is fine (or even) that we have turned the corner.” He sees at least another 18 months of pain. Maybe longer. Who can know or how much.
For sure, real economic stimulus is needed. Productive investment. Not the phony “bailout” kind proposed. Aiding state and local governments. Better unemployment insurance and more for infrastructure. Providing a basis for long-term growth. Not feeding markets and starving the hungry, as one writer put it. Not believing markets on their own will fix things.
Understanding that government must intervene. Responsibly. Facilitate job creation. End casino capitalism. Provide incentives for real economic growth. Let foreclosed and threatened homeowners stay in their homes. Work out an equitable way to do it. “We learned a painful lesson in the 1930s and today: The invisible hand often seems invisible because it’s not there.” It led to the kind of predicament now confronting the country. The solutions proposed will just compound it.
Ones that Can Fix It
Good ones not considered. From figures like Dean Baker of the Center for Economic and Policy Research. Others as well with solid advice to:
– make fraudsters eat the bulk of their losses;
– use public funds only “to sustain the orderly operation of the financial system;”
– minimize speculative finance; the root of the current problem;
– “minimize moral hazard” – the Paulson (and Bernanke) “put” picking up where Greenspan left off;
– let delinquent homeowners stay in their homes and pay rent;
– curtail executive compensation for companies getting government aid;
– make a key Fed responsibility the prevention of asset bubbles; reinstitute regulations to do it; Glass-Steagall for starters that prohibited commercial and investment banks and insurance companies from combining;
– impose a modest financial transactions tax to curb excesses and raise revenue;
– trade assets, like credit default swaps, openly on exchanges to establish fair value for them;
– impose strict limits on leverage;
– keep Fannie and Freddie public institutions; their status before being privatized in 1968; and
– restructure the Fed democratically; a far better solution is abolish it and let government control its own money; use it responsibly for all Americans, not just the privileged few.
Other recommendations recognize no quick or easy solutions to problems this great. Economist James Galbraith says borrowers need collateral. A new Home Owners Loan Corporation to rewrite mortgages. Manage rental conversions, and decide what degraded properties should be demolished. Which ones to save and refurbish. Set it up in communities under federal guidelines and do it quickly. Help state and local governments strapped for cash. Reestablish federal revenue sharing. A National Infrastructure Bank making capital available for infrastructure. Put people to work building it. Protect seniors and near-retirees from wealth loss. Extra Social Security, Medicare and Medicaid revenue will help. Get money in the hands of people who’ll spend it.
Address other crucial issues like energy conservation, reconstruction and renewable power. Infrastructure overall. Tuition help for students. Another GI bill. Credit card and mortgage interest rate caps. Rescind anti-consumist laws like the misnamed 2005 Bankruptcy Abuse Prevention and Consumer Protection Act. A boon for credit card companies and other businesses. Unfairly burdensome to the public.
A whole range of other projects and ideas to redirect the economy away from speculative finance and militarism and toward high-return public investment. Do it before it’s too late. Recognize that the present course is unsustainable. Imagine a government working for everyone and not just the privileged few. Imagine it not tolerating fraud and malfeasance.
Instead, Congress agreed to a “bailout” and passed a record $634 billion omnibus spending bill (to run the government through March 6, 2009) to include a record Pentagon budget; $25 billion in low-interest auto industry loans; maybe with no provision for repayment; lifting a quarter-century ban on Atlantic and Pacific off-shore drilling; billions more in earmarked pork; and likely more coming later for the airlines and other endangered companies. Taxpayers for Common Sense criticized the bill at the same time it noted that government “bailout” appropriations will reach about $1.2 trillion with the $700 billion Paulson scheme. Others put the total above $1.5 trillion, and many say it’s only for starters.
Paying “hold-to-maturity” prices compounds the fraud. For securitized assets worth a fraction of full value. Much of it pennies on the dollar, if anything. Trillions of dollars of toxic ones. All sorts of them. Newly invented ones. Structured finance and insurance. Asset-backed securities. Repackaged into marketable pools. Sold to investors. It’s been done for decades but only recently so out of hand. Greed and deregulation created an alphabet soup of levered-up, high-risk securitized assets. Financial alchemy. Largely outright fraud, including:
– collateralized debt obligations (CDOs), including auto loans, credit and corporate debt;
– collateralized (asset-backed home) mortgage obligations (CMOs);
– commercial mortgage-backed securities (CMBS);
– mortgage-backed securities (MBS) and levered loans;
– structured investment vehicles (SIVs);
– special purpose vehicles (SPVs);
– pass-through securities;
– credit and interest rate default swaps;
– commercial paper and more;
– repackaged arcane stuff most people don’t understand; even investors who bought them; like eating a stew with no idea what’s in it; a recipe with no list of ingredients; learning too late it’s toxic and you’re in trouble;
Credit card companies as well from growing amounts of unrepayable credit card debt. The auto industry already assured of a low-interest $25 billion loan (or maybe handout) for starters. Airlines coming next. Select homebuilders and troubled companies called too big to fail. If they’re too big to fail, says one observer, they’re too big to exist.
EESA will give the treasury secretary near-carte blanche powers to conceal fraud and help the fraudsters, including his former company, Goldman Sachs, now in trouble. Pick and choose among others. Which will survive, and what less favored ones will go on the block at fire sale prices or disappear. Today there are 9000 banks in the country. In a decade, half or more of them may be gone.
Economist Michael Hudson calls EESA “cash for trash” and a “giveaway,” not a bailout. A “transfer of wealth to insiders.” A financial coup d’etat. The “largest and most inequitable (kind) since the (19th century) land giveaways to the railroad barons.”
In this case, socializing losses to let fraudsters “sell out all their bad bets.” Junk of all sorts: a stew of securitized assets, bad mortgages, car loans, credit card loans, student loans, anything for insiders stuck with too much of them.
A doomed scheme that will raise the debt level instead of lowering it. Enrich fraudsters with taxpayer funds. Stick the public with toxic junk. Maybe buy time before more people and markets catch on, but, in the end, cripple the economy and erode industrial capitalism with it.
Hudson is justifiably angry given the amount of fraud and deceit. The government-concocted scheme to whitewash it. Reward criminals. Harm most others, and wreck the country at the same time. He says a “kleptocratic class has taken over the economy to replace industrial capitalism….’banksers’ ” for FDR and earlier condemned by Jefferson with this stinging comment:
“I sincerely believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a money aristocracy that has set the government at defiance. The issuing power should be taken from the banks and restored to the people to whom it properly belongs.”
A half century later Lincoln said:
“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country….corporations (including bankers) have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.”
Lincoln refused to pay bankers usurious rates to finance the Civil War and got Congress to pass the 1862 Legal Tender Act. It empowered the US Treasury to issue “greenbacks” that were interest-free because government printed its own money. When Lincoln was assassinated in 1865, the “Greenback Law” was rescinded. A new national banking act was passed, and the government once again had to pay interest to bankers.
On June 4, 1963, President Kennedy issued executive order (EO) 11110 giving the president authority to issue currency. He ordered the treasury to begin printing “United States (Treasury) Notes” to replace “Federal Reserve Notes.” He began a process to let government control its own money and no longer private bankers under the guise of the Federal Reserve. Months later, Kennedy was assassinated. Once Lyndon Johnson took office, he rescinded EO 11110 and reestablished the current system. More on that below.
The Two Greatest Ever Financial Crimes – Today’s Fraud and the 1913 Federal Reserve Act’s Privatization of Money Creation
Most people think the Federal Reserve is a government agency, subject to its control. It’s sometimes mistakenly called a quasi-governmental decentralized central bank to disguise its real identity and purpose. Its Eccles building headquarters compounds the subterfuge. Below it’s stripped away.
The Federal Reserve is a private for-profit banking cartel. Owned and run by major banks and Wall Street in each of its 12 Districts. It was created and operates in violation of Article 1, Section 8 of the Constitution that states that Congress alone shall have the power to create money and regulate its value. In 1935, the Supreme Court ruled that Congress cannot constitutionally delegate this power to another authority, but, in fact it did.
On December 22, 1913, between 1:30 – 4:30 AM, the Federal Reserve Act was shepherded through a special Congressional Conference Committee. Then voted on and passed the next day. Two days before Christmas with many members gone and most others with no time to read or consider this momentous document.
By enacting this law, Congress and President Woodrow Wilson defrauded the public. Wilson later said (when it was too late to matter) he made a mistake and “unwittingly ruined my country.” This from a man who was an intellect. Trained in the law. A PhD in political science and president of Princeton University in his earlier years.
The Federal Reserve Act gives private bankers the most important of all powers. The one most of all that governments should never relinquish. The authority to print money. Control its supply. Its price through the Fed Funds rate and how it influences the whole yield curve. Loan it out for profit, and charge government interest on its own money. It’s later returned minus operating expenses and a guaranteed 6% profit. Taxpayers foot the bill. An early and continuing example of wealth transfer from the public to powerful bankers. Illegally sanctioned by Congress and the president.
The Fed literally creates money out of nothing. Expands or contracts its supply as it wishes – with no government oversight or control. Gold once backed it until Nixon closed the gold window in August 1971. Suspended dollar convertibility into the metal, and ended compliance with the Bretton Woods core provision. The US dollar became fiat currency. Mere paper. Backed by nothing except the faith of the issuing authority.
Given today’s crisis, that faith is fast eroding and is to blame for dollar weakness. Mostly because of profligate policies by private bankers running the country’s monetary policy for their own gain. The grandest of grand thefts along with today’s all-consuming fraud. Backed by the full faith and credit of the government, and up to now at least, with most people none the wiser.
A Growing Public Response to the Crisis
For how long is the question given growing public anger and people expressing it publicly. It has administration officials worried enough to order what Michel Chossudovsky wrote in his September 26 article titled “Pre-election Militarization of the North American Homeland.”
He cites an Army Times article saying that the 3rd Infantry’s 1st Brigade Combat Team is coming home (in October) from Iraq as (according to the Times) “an on-call federal response force for natural or manmade emergencies and disasters, including terrorist attacks.” Perhaps with a manufactured incident as pretext. To defend the homeland against ourselves. Be deployed against dissent. Erupting public anger. On city streets like in Denver and St. Paul. Displaying civil disobedience. Defiance against fraud, deceit, illegal foreign wars, and nearly eight intolerable years under George Bush and a complicit Congress. Capped by the current financial crisis touching everyone while government rewards crime and hangs its victims out to dry.
The 3rd Infantry’s 1st Brigade is for combat. It’s not the National Guard or local police. It’s trained for war. “Equipped to kill people” with potent weapons, and a last hurrah scheme may be planned to divert public attention from the financial crisis. A “terrorist” attack with “chemical, biological” or other dangerous weapons. A possible pretext for martial law at a time the administration and Congress are vulnerable. When people are angry about Washington protecting the privileged. Partnering with them in crime. Defrauding the public and stifling dissent. Moving one step closer to tyranny and away from silly notions about democracy. Proving crime indeed does pay and awfully well on Wall Street. “It’s the economy, stupid.” Theirs, not ours.
Stephen Lendman is a Research Associate of the Centre for Research on Globalization. He lives in Chicago and can be reached at lendmanstephen@sbcglobal.net.
Also visit his blog site at sjlendman.blogspot.com and listen to The Global Research News Hour on RepublicBroadcasting.org Mondays from 11AM – 1PM for cutting-edge discussions with distinguished guests. All programs are archived for easy listening.
USA – Potential FEMA concentration camps and their locations
This was sent to me by the Canadian Action Party, although I’m pretty sure I saw the same list elsewhere. However it doesn’t hurt to re-post the information.
There over 800 prison camps in the United States, all fully operational and ready to receive prisoners. They are all staffed and even surrounded by full-time guards, but they are all empty. These camps are to be operated by FEMA (Federal Emergency Management Agency) should Martial Law need to be implemented in the United States and all it would take is a presidential signature on a proclamation and the attorney general’s signature on a warrant to which a list of names is attached. Ask yourself if you really want to be on
Ashcroft’s list.
The Rex 84 Program was established on the reasoning that if a “mass exodus” of illegal aliens crossed the Mexican/US border, they would be quickly rounded up and detained in detention centers by FEMA. Rex 84 allowed many military bases to be closed down and to be turned into prisons.
Operation Cable Splicer and Garden Plot are the two sub programs which will be implemented once the Rex 84 program is initiated for its proper purpose.
Garden Plot is the program to control the population. Cable Splicer is the program for an orderly takeover of the state and local governments by the federal government. FEMA is the executive arm of the coming police state and thus will head up all operations. The Presidential Executive Orders already listed on the Federal Register also are part of the legal framework for this operation.
The camps all have railroad facilities as well as roads leading to and from the detention facilities. Many also have an airport nearby. The majority of the camps can house a population of 20,000 prisoners. Currently, the largest of these facilities is just outside of Fairbanks, Alaska. The Alaskan facility is a massive mental health facility and can hold approximately 2 million people.
Now let’s review the justification for any actions taken…
Executive Orders associated with FEMA that would suspend the Constitution and
the Bill of Rights. These Executive Orders have been on record for nearly 30
years and could be enacted by the stroke of a Presidential pen:…
EXECUTIVE ORDER 10990 allows the government to take over all modes of transportation and control of
highways and seaports.
EXECUTIVE ORDER 10995
allows the government to seize and control the communication media.
EXECUTIVE ORDER 10997
allows the government to take over all electrical power, gas, petroleum, fuels and minerals.
EXECUTIVE ORDER 10998
allows the government to seize all means of transportation, including personal cars, trucks or vehicles of any kind and total control over all highways, seaports, and waterways.
EXECUTIVE ORDER 10999 allows the government to take over all food resources and farms.
EXECUTIVE ORDER 11000
allows the government to mobilize civilians into work brigades under government supervision.
EXECUTIVE ORDER 11001
allows the government to take over all health, education and welfare functions.
EXECUTIVE ORDER 11002
designates the Postmaster General to operate a national registration of all persons.
EXECUTIVE ORDER 11003 allows the government to take over all airports and aircraft, including commercial aircraft.
EXECUTIVE ORDER 11004 allows the Housing and Finance Authority to relocate communities, build new housing with public funds, designate areas to be abandoned, and establish new locations for populations.
EXECUTIVE ORDER 11005
allows the government to take over railroads, inland waterways and public storage facilities.
EXECUTIVE ORDER 11051 specifies the responsibility of the Office of Emergency Planning and gives
authorization to put all Executive Orders into effect in times of increased international tensions and economic or financial crisis.
EXECUTIVE ORDER 11310
grants authority to the Department of Justice to enforce the plans set out in Executive Orders, to institute industrial support, to establish judicial and legislative liaison, to control all aliens, to operate penal and correctional institutions, and to advise and assist the President.
EXECUTIVE ORDER 11049 assigns emergency preparedness function to federal departments and agencies, consolidating 21 operative Executive Orders issued over a fifteen year period.
EXECUTIVE ORDER 11921
allows the Federal Emergency Preparedness Agency to develop plans to establish control over the mechanisms of production and distribution, of energy sources, wages, salaries, credit and the flow of money in U.S. financial institution in any undefined national emergency. It also provides that when a state of
emergency is declared by the President, Congress cannot review the action for six months. The Federal Emergency Management Agency has broad powers in every aspect of the nation. General Frank Salzedo, chief of FEMA’s Civil Security Division stated in a 1983 conference that he saw FEMA’s role as a “new frontier in the protection of individual and governmental leaders from assassination, and of civil and military installations from sabotage and/or attack, as well as prevention of dissident groups from gaining access to U.S. opinion, or a global audience in times of crisis.” FEMA’s powers were consolidated by President Carter to incorporate the…
National Security Act of 1947 allows for the strategic relocation of industries, services, government and other essential economic activities, and to rationalize the requirements for manpower, resources and production facilities.
1950 Defense Production Act gives the President sweeping powers over all aspects of the economy.
Act of August 29, 1916 authorizes the Secretary of the Army, in time of war, to take possession of
any transportation system for transporting troops, material, or any other purpose related to the emergency.
International Emergency Economic Powers Act enables the President to seize the property of a foreign country or national.
These powers were transferred to FEMA in a sweeping consolidation in 1979.
Where are these camps?
ALABAMA
Opelika – Military compound either in or very near town. Aliceville – WWII German POW camp – capacity 15,000 Ft. McClellan (Anniston) – Opposite side of town from Army Depot; Maxwell AFB (Montgomery) – Civilian prison camp established under Operation Garden Plot, currently operating with support staff and small inmate population. Talladega – Federal prison “satellite” camp.
ALASKA
Wilderness – East of Anchorage. No roads, Air & Railroad access only. Estimated capacity of 500,000 Elmendorf AFB – Northeast area of Anchorage – far end of base. Garden Plot facility. Eielson AFB – Southeast of Fairbanks. Operation Garden Plot facility. Ft. Wainwright – East of Fairbanks
ARIZONA
Ft. Huachuca – 20 miles from Mexican border, 30 miles from Nogales Rex ‘84 facility. Pinal County – on the Gila River – WWII Japanese detention camp. May be renovated. Yuma County – Colorado River – Site of former Japanese detention camp (near proving grounds). This site was completely removed in 1990 according to some reports. Phoenix – Federal Prison Satellite Camp. Main federal facility expanded. Florence – WWII prison camp NOW RENOVATED, OPERATIONAL with staff & 400 prisoners, operational capacity of 3,500.
Wickenburg – Airport is ready for conversion; total capacity unknown. Davis- Monthan AFB (Tucson) – Fully staffed and presently holding prisoners!! Sedona – site of possible UN base.
ARKANSAS
Ft. Chaffee (near Fort Smith, Arkansas) – Has new runway for aircraft, new camp facility with cap of 40,000 prisoners Pine Bluff Arsenal – This location also is the repository for B-Z nerve agent, which causes sleepiness, dizziness, stupor; admitted use is for civilian control. Jerome – Chicot/Drew Counties – site of WWII Japanese camps Rohwer – Descha County – site of WWII Japanese camps Blythville AFB – Closed airbase now being used as camp. New wooden barracks have been constructed at this location. Classic decorations -guard towers, barbed wire, high fences. Berryville – FEMA facility located east of Eureka Springs off Hwy. 62. Omaha – Northeast of Berryville near Missouri state line, on Hwy 65 south of old wood processing plant. Possible crematory facility.
CALIFORNIA
Vandenburg AFB – Rex 84 facility, located near Lompoc & Santa Maria. Internment facility is located near the oceanside, close to Space Launch Complex #6, also called “Slick Six”. The launch site has had “a flawless
failure record” and is rarely used. Norton AFB – (closed base) now staffed with UN according to some sources. Tule Lake – area of “wildlife refuge”, accessible by unpaved road, just inside Modoc County. Fort Ord – Closed in 1994, this facility is now an urban warfare training center for US and foreign troops, and may have some “P.O.W. – C.I.” enclosures. Twentynine Palms Marine Base – Birthplace of the infamous “Would you shoot American citizens?” Quiz. New camps being built on “back 40″. Oakdale – Rex 84 camp capable of holding at least 20,000 people. 90 mi. East of San Francisco. Terminal Island – (Long Beach) located next to naval shipyards operated by ChiCom shipping interests. Federal prison facility located here. Possible deportation point. Ft. Irwin – FEMA facility near Barstow. Base is designated inactive but has staffed camp. McClellan AFB – facility capable for 30,000 – 35,000 Sacramento – Army Depot – No specific information at this time. Mather AFB – Road to facility is blocked off by cement barriers and a stop sign. Sign states area is restricted; as of 1997 there were barbed wire fences pointing inward, a row of stadium lights pointed toward an empty field, etc. Black boxes on poles may have been cameras.
COLORADO
Trinidad – WWII German/Italian camp being renovated. Granada – Prowers County – WWII Japanese internment camp Ft. Carson – Along route 115 near Canon City
CONNECTICUT, DELAWARE
No data available.
FLORIDA
Avon Park – Air Force gunnery range, Avon Park has an on-base “correctional facility” which was a former WWII detention camp. Camp Krome – DoJ detention/interrogation center, Rex 84 facility Eglin AFB – This base is over 30 miles long, from Pensacola to Hwy 331 in De Funiak Springs. High capacity facility, presently manned and populated with some prisoners. Pensacola – Federal Prison Camp Everglades – It is believed that a facility may be carved out of the wilds here.
GEORGIA
Ft. Benning – Located east of Columbus near Alabama state line. Rex 84 site – Prisoners brought in via Lawson Army airfield. Ft. Mc Pherson – US Force Command – Multiple reports that this will be the national headquarters and coordinating center for foreign/UN troop movement and detainee collection. Ft.
Gordon – West of Augusta – No information at this time. Unadilla – Dooly County – Manned, staffed FEMA prison on route 230, no prisoners. Oglethorpe – Macon County; facility is located five miles from Montezuma, three miles from Oglethorpe. This FEMA prison has no staff and no prisoners. Morgan – Calhoun County, FEMA facility is fully manned & staffed – no prisoners. Camilla – Mitchell County, south of Albany. This FEMA facility is located on Mt. Zion Rd approximately 5.7 miles south of Camilla. Unmanned – no prisoners, no staff. Hawkinsville – Wilcox County; Five miles east of town, fully manned and staffed but no prisoners. Located on fire road 100/Upper River Road Abbeville – South of Hawkinsville on US route 129; south of town off route 280 near Ocmulgee River. FEMA facility is staffed but without prisoners. McRae – Telfair County – 1.5 miles west of McRae on Hwy 134 (8th St). Facility is on Irwinton Avenue off 8th St., manned & staffed – no prisoners. Fort Gillem – South side of Atlanta – FEMA designated detention facility. Fort Stewart – Savannah area – FEMA designated detention facility
HAWAII
Halawa Heights area – Crematory facility located in hills above city. Area is marked as a state department of health laboratory. Barbers Point NAS – There are several military areas that could be equipped for detention / deportation. Honolulu – Detention transfer facility at the Honolulu airport similar in construction to the one in.Oklahoma (pentagon-shaped building where airplanes can taxi up to).
IDAHO
Minidoka/Jerome Counties – WWII Japanese-American internment facility possibly under renovation. Clearwater National Forest – Near Lolo Pass – Just miles from the Montana state line near Moose Creek, this unmanned facility is reported to have a nearby airfield. Wilderness areas – Possible location. No data.
ILLINOIS
Marseilles – Located on the Illinois River off Interstate 80 on Hwy 6. It is a relatively small facility with a cap of 1400 prisoners. Though it is small it is designed like prison facilities with barred windows, but the real smoking gun is the presence of military vehicles. Being located on the Illinois River it is possible that prisoners will be brought in by water as well as by road and air. This facility is approximately 75 miles west of Chicago. National Guard training area nearby. Scott AFB – Barbed wire prisoner enclosure reported to exist just off-base. More info needed, as another facility on-base is beieved to exist. Pekin – This Federal satellite prison camp is also on the Illinois River, just south of Peoria. It supplements the federal penitentiary
in Marion, which is equipped to handle additional population outside on the grounds. Chanute AFB – Rantoul, near Champaign/Urbana – This closed base had WWII – era barracks that were condemned and torn down, but the medical facility was upgraded and additional fencing put up in the area. More info needed. Marion – Federal Penitentiary and satellite prison camp inside Crab Orchard Nat’l Wildlife Refuge. Manned, staffed, populated fully. Greenfield – Two federal correctional “satellite prison camps” serving Marion – populated as above. Shawnee National Forest – Pope County – This area has seen heavy traffic of foreign military equipment and troops via Illinois Central Railroad, which runs through the area. Suspected location is unknown, but may be close to Vienna and Shawnee correctional centers, located 6 mi. west of Dixon Springs. Savanna Army Depot – NW area of state on Mississippi River. Lincoln, Sheridan, Menard, Pontiac, Galesburg – State prison facilities equipped for major expansion and close or adjacent to highways & railroad tracks. Kankakee – Abandoned industrial area on west side of town (Rt.17 & Main) designated as FEMA detention site. Equipped with water tower, incinerator, a small train yard behind it and the rear of the facility is surrounded by barbed wire facing inwards.
INDIANA
Indianapolis / Marion County – Amtrak railcar repair facility (closed); controversial site of a major alleged detention / processing center. Although some sources state that this site is a “red herring”, photographic and video evidence suggests otherwise. This large facility contains large 3-4 inch gas mains to large furnaces (crematoria??), helicopter landing pads, railheads for prisoners, Red/Blue/Green zones for classifying/processing incoming personnel, one-way turnstiles, barracks, towers, high fences with razor wire, etc. Personnel with government clearance who are friendly to the patriot movement took a guided tour of the facility to confirm this site. This site is located next to a closed refrigeration plant facility. Ft. Benjamin Harrison – Located in the northeast part of Indianapolis, this base has been decomissioned from “active” use but portions are still ideally converted to hold detainees. Helicopter landing areas still exist for prisoners to be brought in by air, land & rail. Crown Point – Across street from county jail, former hospital.
One wing presently being used for county work-release program, 80% of facility still unused. Possible FEMA detention center or holding facility. Camp Atterbury – Facility is converted to hold prisoners and boasts two active compounds presently configured for minumum security detainees. Located just west of Interstate 65 near Edinburgh, south of Indianapolis. Terre Haute – Federal Correctional Institution, Satellite prison camp and death facility. Equipped with crematoria reported to have a capacity of 3,000 people a day. FEMA designated facility located here. Fort Wayne – This city located in Northeast Indiana has a FEMA designated detention facility, accessible by air, road and nearby rail. Kingsbury – This “closed” military base is adjacent to a state fish & wildlife preserve. Part of the base is converted to an industrial park, but the southern portion of this property is still used. It is bordered on the south by railroad, and is staffed with some foreign-speaking UN troops. A local police officer who was hunting and camping close to the base in the
game preserve was accosted, roughed up, and warned by the English-speaking unit commander to stay away from the area. It was suggested to the officer that the welfare of his family would depend on his “silence”. Located just southeast of LaPorte. Jasper-Pulaski Wildlife Area – Youth Corrections farm located here. Facility is “closed”, but is still staffed and being “renovated”. Total capacity unknown. Grissom AFB – This closed airbase still handles a lot of traffic, and has a “state-owned” prison compound on the southern part of the facility.
UNICOR
. Jefferson Proving Grounds – Southern Indiana – This facility was an active base with test firing occuring daily. Portions of the base have been opened to create an industrial park, but other areas are still highly restricted. A camp is believed to be located “downrange”. Facility is equipped with an airfield and has a nearby rail line. Newport – Army Depot – VX nerve gas storage facility. Secret meetings were held here in 1998 regarding the addition of the Kankakee River watershed to the Heritage Rivers Initiative. Hammond – large enclosure identified in FEMA-designated city.
IOWA
No data available.
KANSAS
Leavenworth – US Marshal’s Fed Holding Facility, US Penitentiary, Federal Prison Camp, McConnell Air Force Base. Federal death penalty facility. Concordia – WWII German POW camp used to exist at this location but there is no facility there at this time. Ft. Riley – Just north of Interstate 70, airport, near city of Manhattan. El Dorado – Federal prison converted into forced-labor camp, UNICOR industries. Topeka – 80 acres has been converted into a temporary holding camp.
KENTUCKY
Ashland – Federal prison camp in Eastern Kentucky near the Ohio River. Louisville – FEMA detention facility, located near restricted area US naval ordnance plant. Military airfield located at facility, which is on south side of city. Lexington – FEMA detention facility, National Guard base with adjacent airport facility. Maachester – Federal prison camp located inside Dan Boone National Forest. Ft. Knox – Detention center, possibly located near Salt River, in restricted area of base. Local patriots advise that black Special Forces & UN gray helicopters are occasionally seen in area. Land Between the Lakes – This area was declared a UN biosphere and is an ideal geographic location for detention facilities. Area is an isthmus extending out from
Tennessee, between Lake Barkley on the east and Kentucky Lake on the west. Just scant miles from Fort Campbell in Tennessee.
LOUISIANA
Ft. Polk – This is a main base for UN troops & personnel, and a training center for the disarmament of America. Livingston – WWII German/Italian internment camp being renovated?; halfway between Baton Rouge and Hammond, several miles north of Interstate 12. Oakdale – Located on US route 165 about 50 miles south of Alexandria; two federal detention centers just southeast of Fort Polk.
MAINE
Houlton – WWII German internment camp in Northern Maine, off US Route 1.
MARYLAND, and DC
Ft. Meade – Halfway between the District of Criminals and Baltimore. Data needed. Ft. Detrick – Biological warfare center for the NWO, located in Frederick.
MASSACHUSETTS
Camp Edwards / Otis AFB – Cape Cod – This “inactive” base is being converted to hold many New Englander patriots. Capacity unknown. Ft. Devens – Active detention facility. More data needed.
MICHIGAN
Camp Grayling – Michigan Nat’l Guard base has several confirmed detention camps, classic setup with high fences, razor wire, etc. Guard towers are very well-built, sturdy. Multiple compounds within larger enclosures. Facility deep within forest area. Sawyer AFB – Upper Peninsula – south of Marquette – No
data available. Bay City – Classic enclosure with guard towers, high fence, and close to shipping port on Saginaw Bay, which connects to Lake Huron. Could be a deportation point to overseas via St. Lawrence Seaway. Southwest – possibly Berrien County – FEMA detention center. Lansing – FEMA detention facility.
MINNESOTA
Duluth – Federal prison camp facility. Camp Ripley – new prison facility.
MISSISSIPPI
These sites are confirmed hoaxes. Hancock County – NASA test site De Soto National Forest. “These two supposed camps in Mississippi do not exist. Members of the Mississippi Militia have checked these out on more than one occasion beginning back when they first appeared on the Internet and throughout the Patriot Movement.” – Commander D. Rayner, Mississippi Militia
MISSOURI
Richards-Gebaur AFB – located in Grandview, near K.C.MO. A very large internment facility has been built on this base, and all base personnel are restricted from coming near it. Ft. Leonard Wood – Situated in the middle of Mark Twain National Forest in Pulaski County. This site has been known for some UN training, also home to the US Army Urban Warfare Training school “Stem Village”. Warsaw – Unconfirmed report of a large concentration camp facility.
MONTANA
Malmstrom AFB – UN aircraft groups stationed here, and possibly a detention facility.
NEBRASKA
Scottsbluff – WWII German POW camp (renovated?). Northwest, Northeast corners of state – FEMA detention facilities – more data needed. South Central part of state – Many old WWII sites – some may be renovated.
NEVADA
Elko – Ten miles south of town. Wells – Camp is located in the O’Niel basin area, 40 miles north of Wells, past Thousand Springs, west off Hwy 93 for 25 miles. Pershing County – Camp is located at I-80 mile marker 112, south side of the highway, about a mile back on the county road and then just off the
road about 3/4mi. Winnemucca – Battle Mountain area – at the base of the mountains. Nellis Air Force Range – Northwest from Las Vegas on Route 95. Nellis AFB is just north of Las Vegas on Hwy 604. Stillwater Naval Air Station – east of Reno . No additional data.
NEW HAMPSHIRE / VERMONT
Northern New Hampshire – near Lake Francis. No additional data.
NEW JERSEY
Ft. Dix / McGuire AFB – Possible deportation point for detainees. Lots of pictures taken of detention compounds and posted on Internet, this camp is well-known. Facility is now complete and ready for occupancy.
NEW MEXICO
Ft. Bliss – This base actually straddles Texas state line. Just south of Alomogordo, Ft. Bliss has thousands of acres for people who refuse to go with the “New Order”. Holloman AFB (Alomogordo)- Home of the German Luftwaffe in Amerika; major UN base. New facility being built on this base, according to recent visitors. Many former USAF buildings have been torn down by the busy and rapidly growing German military force located here. Fort Stanton – currently being used as a youth detention facility approximately 35 miles
north of Ruidoso, New Mexico. Not a great deal of information concerning the Lordsburg location. White Sands Missile Range – Currently being used as a storage facility for United Nations vehicles and equipment. Observers have seen this material brought in on the Whitesands rail spur in Oro Grande New Mexico about thirty miles from the Texas, New Mexico Border.
NEW YORK
Ft. Drum – two compounds: Rex 84 detention camp and FEMA detention facility. Albany – FEMA detention facility. Otisville – Federal correctional facility, near Middletown. Buffalo – FEMA detention facility.
NORTH CAROLINA
Camp Lejeune / New River Marine Airfield – facility has renovated, occupied WWII detention compounds and “mock city” that closely resembles Anytown, USA. Fort Bragg – Special Warfare Training Center. Renovated WWII detention facility. Andrews – Federal experiment in putting a small town under siege. Began with the search/ hunt for survivalist Eric Rudolph. No persons were allowed in or out of town without federal permission and travel through town was highly restricted. Most residents compelled to stay in their homes.
Unregistered Baptist pastor from Indiana visiting Andrews affirmed these facts.
NORTH DAKOTA
Minot AFB – Home of UN air group. More data needed on facility.
OHIO
Camp Perry – Site renovated; once used as a POW camp to house German and Italian prisoners of WWII. Some tar paper covered huts built for housing these prisoners are still standing. Recently, the construction of multiple 200-man barracks have replaced most of the huts. Cincinnati, Cleveland, Columbus – FEMA detention facilities. Data needed. Lima – FEMA detention facility. Another facility located in/near old stone quarry near Interstate 75. Railroad access to property, fences etc.
OKLAHOMA
Tinker AFB (OKC) – All base personnel are prohibited from going near civilian detention area, which is under constant guard. Will Rogers World Airport – FEMA’s main processing center for west of the Mississippi. All personnel are kept out of the security zone. Federal prisoner transfer center located here (A pentagon-shaped building where airplanes can taxi up to). Photos have been taken and this site will try to post soon! El Reno – Renovated federal internment facility with CURRENT population of 12,000 on Route 66. McAlester – near Army Munitions Plant property – former WWII German / Italian POW camp designated for future use. Ft. Sill (Lawton) – Former WWII detention camps. More data still needed.
OREGON
Sheridan – Federal prison satellite camp northwest of Salem. Josephine County – WWII Japanese internment camp ready for renovation. Sheridan – FEMA detention center. Umatilla – New prison spotted.
PENNSYLVANIA
Allenwood – Federal prison camp located south of Williamsport on the Susquehanna River. It has a current inmate population of 300, and is identified by William Pabst as having a capacity in excess of 15,000 on 400
acres. Indiantown Gap Military Reservation – located north of Harrisburg. Used for WWII POW camp and renovated by Jimmy Carter. Was used to hold Cubans during Mariel boat lift. Camp Hill – State prison close to Army depot. Lots of room, located in Camp Hill, Pa. New Cumberland Army Depot – on the Susquehanna River, located off Interstate 83 and Interstate 76. Schuylkill Haven – Federal prison camp, north of Reading.
SOUTH CAROLINA
Greenville – Unoccupied youth prison camp; total capacity unknown. Charleston – Naval Reserve & Air Force base, restricted area on naval base.
SOUTH DAKOTA
Yankton – Federal prison camp Black Hills Nat’l Forest – north of Edgemont, southwest part of state. WWII
internment camp being renovated.
TENNESSEE
Ft. Campbell – Next to Land Between the Lakes; adjacent to airfield and US Alt. 41. Millington – Federal prison camp next door to Memphis Naval Air Station. Crossville – Site of WWII German / Italian prison camp is renovated; completed barracks and behind the camp in the woods is a training facility with high tight ropes and a rappelling deck. Nashville – There are two buildings built on State property that are definitely built to hold prisoners. They are identical buildings – side by side on Old Briley Parkway. High barbed wire fence that curves inward.
TEXAS
Austin – Robert Mueller Municipal airport has detenion areas inside hangars. Bastrop – Prison and military vehicle motor pool. Eden – 1500 bed privately run federal center. Currently holds illegal aliens. Ft. Hood (Killeen) – Newly built concentration camp, with towers, barbed wire etc., just like the one featured in the movie Amerika. Mock city for NWO shock- force training. Some footage of this area was used in “Waco: A New Revelation” Reese AFB (Lubbock) – FEMA designated detention facility. Sheppard AFB – in Wichita Falls just south of Ft. Sill, OK. FEMA designated detention facility. North Dallas – near Carrolton – water treatment plant, close to interstate and railroad. Mexia – East of Waco 33mi.; WWII German facility may be renovated.
Amarillo – FEMA designated detention facility Ft. Bliss (El Paso) – Extensive renovation of buildings and from what patriots have been able to see, many of these buildings that are being renovated are being surrounded by razor wire. Beaumont / Port Arthur area – hundreds of acres of federal camps already built on large-scale detention camp design, complete with the double rows of chain link fencing with razor type concertina wire on top of each row. Some (but not all) of these facilities are currently being used for low-risk state prisoners
who require a minimum of supervision. Ft. Worth – Federal prison under construction on the site of Carswell AFB.
UTAH
Millard County – Central Utah – WWII Japanese camp. (Renovated?) Ft. Douglas – This “inactive” military reservation has a renovated WWII concentration camp. Migratory Bird Refuge – West of Brigham City – contains a WWII internment camp that was built before the game preserve was established. Cedar City – east of city – no data available. Wendover – WWII internment camp may be renovated. Skull Valley – southwestern Camp William property – east of the old bombing range. Camp was accidentally discovered by a man and his son who were rabbit hunting; they were discovered and apprehended. SW of Tooele.
VIRGINIA
Ft. A.P. Hill (Fredericksburg) – Rex 84 / FEMA facility. Estimated capacity 45,000. Petersburg – Federal satellite prison camp, south of Richmond.
WEST VIRGINIA
Beckley – Alderson – Lewisburg – Former WWII detention camps that are now converted into active federal prison complexes capable of holding several times their current populations. Alderson is presently a women’s federal reformatory. Morgantown – Federal prison camp located in northern WV; just north of
Kingwood. Mill Creek – FEMA detention facility. Kingwood – Newly built detention camp at Camp Dawson Army Reservation. More data needed on Camp Dawson.
WASHINGTON
Seattle/Tacoma – SeaTac Airport: fully operational federal transfer center Okanogan County – Borders Canada and is a site for a massive concentration camp capable of holding hundreds of thousands of people for slave labor. This is probably one of the locations that will be used to hold hard core patriots who will be held captive for the rest of their lives. Sand Point Naval Station – Seattle – FEMA detention center used actively during the 1999 WTO protests to classify prisoners. Ft. Lewis / McChord AFB – near Tacoma – This is one of several sites that may be used to ship prisoners overseas for slave labor.
WISCONSIN
Ft. McCoy – Rex 84 facility with several complete interment compounds. Oxford – Central part of state – Federal prison & staellite camp and FEMA detention facility.
WYOMING
Heart Mountain – Park County N. of Cody – WWII Japanese interment camp ready for renovation. Laramie – FEMA detention facility Southwest – near Lyman – FEMA detention facility East Yellowstone – Manned internment facility – Investigating patriots were apprehended by European soldiers speaking in an unknown language. Federal government assumed custody of the persons and arranged their release.
OTHER LOCATIONS IN THE UNITED STATES
There are many other locations not listed above that are worthy of consideration as a possible detention camp site, but due to space limitations and the time needed to verify, could not be included here. Virtually all military reservations, posts, bases, stations, & depots can be considered highly suspect (because it is “federal” land). Also fitting this category are “Regional Airports” and “International Airports” which also fall under federal jurisdiction and have limited-access areas. Mental hospitals, closed hospitals & nursing homes, closed military bases, wildlife refuges, state prisons, toxic waste dumps, hotels and other areas all have varying degrees of potential for being a detention camp area. The likelihood of a site being suspect increases with transportation access to the site, including airports/airstrips, railheads, navigable waterways & ports, interstate and US highways. Some facilities are “disguised” as industrial or commercial properties, camouflaged or even wholly contained inside large buildings (Indianapolis) or factories. Many inner-city buildings left vacant during the de-industrialization of America have been quietly acquired and held, sometimes retrofitted for their new uses.
CANADA
Our Canadian friends tell us that virtually all Canadian military bases, especially those north of the 50th Parallel, are all set up with concentration camps. Not even half of these can be listed, but here are a few sites with the massive land space to handle any population: Suffield CFB – just north of Medicine Hat, less than 60 miles from the USA. Primrose Lake Air Range – 70 miles northeast of Edmonton. Wainwright CFB – halfway between Medicine Hat and Primrose Lake. Ft. Nelson – Northernmost point on the BC Railway line.
Ft. McPherson – Very cold territory ~ NW Territories. Ft. Providence – Located on Great Slave Lake. Halifax – Nova Scotia. Dept. of National Defense reserve…. And others.
OVERSEAS LOCATIONS
Guayanabo, Puerto Rico – Federal prison camp facility. Capacity unknown. Guantanamo Bay, Cuba – US Marine Corps Base – Presently home to 30,000 Mariel Cubans and 40,000 Albanians. Total capacity unknown.
UK issues new ID card for aliens
How nice of the UK to start the ball rolling on national ID cards. As the article states, this is not simply to keep track of immigrants and to cut down on illegals staying in the country. This ID card will be mandatory for ALL UK citizens within 10 years. When is North America’s ID being unveiled? I will be uploading a photo of the ID card once I figure out why it’s not uploading.
THIS is Britain’s first identity card — and thousands of people will have one within weeks.
They will be compulsory for 50,000 non-EU students and foreigners seeking marriage visas from November.
In ten years the pink and sky-blue card will be carried by all UK citizens.
Home Secretary Jacqui Smith, said it will enable people to prove identity “easily and securely”.
The card, similar to a credit card, includes a picture of the holder, name, status, benefit entitlement and anti-fraud measures.
Bailout is financial equivalent of the Patriot Act
NEW YORK: The passage is stunning:
“Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency,” the original draft of the proposed bill says.
And with those words, the Treasury secretary – whoever that may be in a few months – would be vested with perhaps the most incredible powers ever bestowed on one person over the economic and financial life of the United States. It is the financial equivalent of the Patriot Act, after 9/11.
Treasury Secretary Henry Paulson Jr.’s $700 billion proposal to bail out Wall Street is both the biggest rescue and the most amazing power grab in the history of the American economy.
In many ways, it is classic Wall Street: a big, bold roll of the dice that one trade can save the day. But at the same time, the hypocrisy is thick. The lack of transparency and oversight that got our financial system in trouble in the first place seems written directly into the proposed bill, known as TARP, or the Troubled Asset Relief Program.
Just take a look at the original draft: “The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this act,” the proposed bill read when it was first presented to Congress, “without regard to any other provision of law regarding public contracts.”
It goes on to say, “Any funds expended for actions authorized by this Act, including the payment of administrative expenses, shall be deemed appropriated at the time of such expenditure.”
Slowly but surely, as new versions of the bill are making the rounds in Washington, some legislators are pressing to include new language to give them at least a modicum of oversight. Democrats have complained that the bill gives the Treasury Department “a blank check” – and they’re right.
But given the rush to push the bill through, even if Congress cobbles together some oversight language, it will almost surely be inadequate.
Joshua Rosner, a managing director at Graham Fisher, says TARP should stand for “Total Abdication of Responsibility to the Public.” He calls it “a clear abdication of all congressional oversight and fiscal authorities to a secretary of Treasury that has bungled this crisis from the beginning.”
He argues that the bill grants “greater powers to the secretary of the Treasury than even the president enjoys.”
The bigger issue is that the bill effectively creates protections not just for the Treasury, but for the executives on Wall Street who created this near Armageddon. Rosner says the draft bill “prevents judicial review that could allow the protection of decisions that create false marks, hide prior marks, or could be used to prevent civil or criminal prosecution in situations where a management knowingly provided false marks that aided the growth of this crisis of confidence.”
False marks – using mark-to-market accounting to hide the true value of security, rather than disclose it honestly – has a lot to do with why Jeffrey Skilling, the former Enron chief executive, is in jail.
It is absolutely true, of course, that Paulson needed to do something. By Thursday afternoon, less than 48 hours after the bailout of American International Group, the financial system was near meltdown. The mere rumor that Paulson and the Federal Reserve chairman, Ben Bernanke, were devising a big bailout fund cause the stock market to soar.
In truth, I’m not sure I agree with Rosner’s assessment of Paulson’s job performance. I think he is one of the most competent Treasury secretaries we’ve ever had, and it is hard to imagine anyone else handling this crisis any better. His predecessors, who lacked his grounding in the world of high finance, would most likely have been like deer in headlights.
And when Paulson says, as he did on all the television talk shows Sunday, “I hate the fact that we have to do it, but it’s better than the alternative,” I believe him. (It would have looked better, of course, if he had come up with this plan before it looked as if his former firm, Goldman Sachs, was in jeopardy.)
But the question on the table now is whether the government’s latest response to this crisis – the way it has been constructed, and frankly, the way it is being crammed down everyone’s throat at the eleventh hour – is the right approach. Already the market has its doubts; just look at its performance Monday.
Let put aside the bill’s most offensive aspect – the raw power it gives the Treasury Department, and the lack of oversight it provides – and take a closer look at the practicalities. First off, there is nothing in the bill that will prevent these problems from happening again.
The bill doesn’t address adding greater transparency in investments in subprime loans and securities and credit derivatives, which led directly to the debacles at Lehman and AIG. The bill does nothing to rein in the credit-default swap market, which has turned out to be the weapon of financial mass destruction that Warren Buffett always said it was.
Nor are the Democrats going to help matters with their own changes.
It is all well and good that they hope to use the bill to restrain executive compensation, and add stipulations to help people in danger of losing their homes. But nothing the Democrats have suggested so far tackles the core issues of oversight, transparency or regulation.
Of course, the sickest part is that Wall Street is lining up at the trough for a piece of the action, lobbying to run some of the $700 billion fund – and take huge fees – for their own mess.
However the bailout is structured, no matter what safeguards are put in place, it is likely to be a conflicted mess. How can we possibly trust that the price the government agrees to buy the securities will be fair?
And then there is the jockeying among the banks so they can sell their absolute worst stuff to the government – even loans that have nothing to do with mortgages – and change the rules in the process.
The Financial Services Roundtable, which represents big financial services companies, wrote an e-mail message to members Sunday suggesting, laughably, that “the government bid for the assets should not count as a mark-to-market value for accounting purposes.”
In other words, if the government drives a hard bargain – as it should – the banks don’t have to take write-downs based on the price the feds pay to take junk off their balance sheets.
Watching Wall Street double-dip makes even some in the industry’s top tier cringe.
“Maybe I should move to Russia,” one titan of finance said to me. “It’s obscene, the whole thing. I’m embarrassed for myself.”
Actually, I’ve got a better suggestion: Venezuela.
On Friday last week, Hugo Chávez, the Socialist president of Venezuela, gave a speech in Caracas where, according to Reuters, he said, “The United States has spent $900 billion, four times what Venezuela produces in a year, to try to boost the troubled finance system and housing market.”
Gloating, he added: “They have criticized me, especially in the United States, for nationalizing a great company, Cantv, that didn’t even cost $1.5 billion.”
NO to the Paulson-Bernanke derivatives scam bailout
A long article from Webster Tarpley, but a great one to understand what is happening now, and what happened in the 20s.
http://www.prisonplanet.com/no-to-the-paulson-bernanke-derivatives-scam-bailout.html
Webster G. Tarpley
Wednesday, September 24th 2008
WASHINGTON DC – The grand theft bailout now being rammed through Congress by Treasury Secretary Paulson, Federal Reserve Chairman Bernanke, and other officials of the Bush regime with the help of accomplices Pelosi, Majority Leader Harry Reid, and other parliamentarians is a monstrosity for the ages, combining every hideous feature of monetarism, elitism, oligarchism, and sheer feckless incompetence. It is to all intents and purposes a national suicide note of the United States of America, a contract with the devil that absolutely guarantees irrevocable national decline. For any person of goodwill there can be only one impulse at the present moment, and that is to stop this bailout — to block it, to sabotage it, to bottle it up, to load it with killer amendments, and to do everything legally possible to stop this insane design from going through.
IF MCCAIN VOTES AGAINST THE BAILOUT, HE WILL WIN THE PRESIDENCY
In political terms, McCain is now running well to the left of Obama on this issue, with a much stronger populist profile. McCain has attacked the outrageous greed and corruption of Wall Street. Obama does not dare attack Wall Street, since these are his masters. Obama, sounding like Milton Friedman, only attacks Washington. Obama has said that he will support whatever Paulson demands. That is not a surprise, since Paulson represents Goldman Sachs, and Obama is a wholly owned property of Goldman Sachs, which is his single biggest source of campaign contributions. Obama is a creature of Brzezinski, Soros, and Rockefeller, and without them he has no existence; Obama is an abject Wall Street puppet, an agent of finance capital. This week, both senators will have to decide how they vote on the odious derivatives bailout. Obama will surely vote in favor of it, since this is what Wall Street demands. If McCain votes against it, he will most probably propel himself into the White House on the model of Give ‘Em Hell Harry in 1948. Filthy corrupt Democrats like Schumer are already attacking McCain as the new Huey Long. Huey Long, the Louisiana populist of the 1930s, had many positive features, and we could certainly use a good dose of Huey Long in this country to counteract the elitism, oligarchism, condescension, and arrogant snobbery of foundation operatives like Obama. The bailout is already very unpopular 72% of all voters are opposed to it and it will become more and more hated when it becomes clear that it is also a failure. McCain’s course is clear. Will he have the brains and guts to cross Obama’s T on this vital issue?
PAULSON OF GOLDMAN SACHS, WOULD-BE FINANCE DICTATOR
Paulson is a ruthless and brutal eco-freak usurer who learned his trade at the Goldman Sachs stock-jobbing operation. He is now the leading member of the committee of public safety which rules in Washington, and which includes Gates, Rice, and Mullen. He now demands the astronomical sum of 700 billion dollars for the bailout of mortgage-backed derivatives, collateralized debt obligations, credit default swaps, and other poisonous derivatives. Make no mistake — this is not a bailout of homeowners who are threatened with foreclosure; it is a bailout of the lunatic house of cards which desperate bankers have built on these mortgages using derivatives. The entire crisis is not a crisis of subprime mortgages, it is a crisis of the derivatives bubble which was launched by Wendy Gramm of the Commodities Futures Trading Commission and Greenspan of the Fed with the connivance of Robert Rubin of Goldman Sachs and Citibank, and others in the Clinton administration, some 15 years ago.
These derivatives now amount to a total worldwide notional value that can be estimated between 1 quadrillion and two quadrillion US dollars. This sum is so large that it dwarfs the total value of the entire planet earth and all those who live here. Compared to the cancerous, bloated, and fictitious mass of derivatives which is at the root of this crisis, the $700 billion demanded by politicians, large as this may seem, is nothing but a drop in the bucket. And a drop in the bailout bucket is what it will be. The mass of world derivatives between $1 and $2 quadrillion represents an insatiable black hole which is capable of putting an end, not just to civilization, but the human life itself. The moral choice could not be clearer: humanity will either destroy the derivatives bubble in our time, or the derivatives bubble will surely destroy humanity. Those are the stakes in the current exercise.
Paulson and Bernanke, both lawyers for the Wall Street jackals, lampreys, vultures and hyenas, argue that the public interest demands a bailout of their cronies at Goldman Sachs, Morgan Stanley, J.P. Morgan Chase, Citibank, Bank of America, Wachovia, and the other large money center institutions. Before the American public antes up $700 billion just for openers in the game of genocidal poker which run by the infernal croupiers Paulson and Bernanke, we would be very well advised to examine the veracity of this premise.
COMMERCIAL BANKS ARE INDISPENSABLE
It is of course true that the healthy functioning of the United States economy requires a viable and flexible system of commercial banks. No one should doubt the necessity of commercial banks.
Andrew Jackson was clinically insane on this point, and he still has not a few followers around today. But it ought to be clear that without the services of a well developed commercial banking system, it is impossible to organize business activities as essential as payments, deposits, checking, payrolls, and the discounting of short-term commercial paper, bills of exchange, bills of lading, and all the credit instruments that are intimately connected with real productive activity. Without a functioning commercial banking system, the economic heart of the United States would stop beating, as it briefly did at the end of the Hoover administration in March of 1933. Without commercial banks, no wheel of a factory or railroad can turn, and no commodities can move to show up in supermarkets.
JPM, CITI, BoA ARE DERIVATIVES MONSTERS, NOT COMMERCIAL BANKS
But when we look at institutions like J.P. Morgan Chase, Citibank, and Bank of America, we become aware that these large money center institutions have become detached from any conceivable connection to the world of production, wages, transportation, and all other useful and productive activities. These institutions are not commercial banks any more in any meaningful sense of the term. Ten years ago, in the midst of the Asian financial crisis and the aftermath of the Russian GKO state bankruptcy collapse, the boss of JP Morgan Chase went on television to announce that his bank was specialized in the “risk business.” The risk business meant that JP Morgan Chase, had simply given up on the traditional activity of commercial banks, which was primarily to provide loans to corporations for productive investment in plant and equipment that would also create well-paid industrial jobs. J.P. Morgan Chase decided long ago that that activity was nowhere near profitable enough to be continued.
Instead, J.P. Morgan Chase devoted itself more and more to the issuance, sale, and purchase of derivatives. As early as 1992, the best definition of J.P. Morgan Chase was that it was no longer a commercial bank but rather a derivatives monster. In 2002, the J.P. Morgan Chase derivatives monster came very close to imploding, collapsing in on itself like the hopeless black hole that it still remains to the present day. According to the most recent report of the Comptroller of the Curreny of the US Treasury dated September 30, 2007, JP Morgan Chase today has between $90 trillion and $100 trillion of derivatives. In reality this is a very low-ball estimate, and the real derivatives exposure is some multiple of this figure perhaps $300 or $400 trillion, especially now that Bear Stearns, a smaller black hole of derivatives has been absorbed. But even a mere $90 trillion is already six times the US GDP (currently estimated between $14 and $15 trillion).
DERIVATIVES ARE FINANCIAL AIDS
The question of the derivatives is once again the central issue of the crisis. Most people may not even know what derivatives are, although by now many have some idea that they are dangerous and toxic. French President Jacques Chirac once defined derivatives as financial aids, and he was right. A share of stock supposedly represents part ownership in a corporation. A corporate bond is a debt instrument issued by a corporation, with some claim to a part of the assets in case of bankruptcy liquidation. That means that the stocks and bonds are paper, but paper that is at only one remove from the real world of production, consumption, employment, and wages. The derivative is something radically different.
A derivative represents paper based on paper, no longer a stock or bond, but a future, option, or index that is based on some stock, bond, or other form of paper. Derivatives are therefore at least one step further removed from the world of tangible physical commodity production of useful items which humanity requires in order to survive and to conduct civilization as we know it. In addition to the options, futures, and indices, we have all the possible permutations and combinations of the above, with new variations that are almost infinite. Even to catalogue these would take a book. In addition to these exchange traded derivatives, there is a much larger class of derivative which does not appear on the Chicago Board Options Exchange or analogous institutions in all the money centers of the world. The second and larger class represents the counterparty derivatives, including such things as collateralized debt obligations, mortgage backed securities, structured notes, credit default swaps, and the myriad of other derivative products.
These derivatives were originally supposed to be used as a hedge against risk, but before too long they began to represent the biggest single source of risk and the entire lunatic edifice would finance. By now, to repeat this point yet again, the total world derivatives of in excess of one quadrillion dollars — that is to say, 1000 billion dollars, and may be already approaching the neighborhood of $1.5 quadrillion or even more. One of the inherent problems of derivatives is that nobody knows this exact figure, since derivatives are not reportable in many countries and tend to escape regulation by the proper financial authorities.
DERIVATIVES ARE USELESS AND A THREAT TO CIVILIZATION
You cannot eat derivatives. You cannot live in a derivative. You cannot wear derivatives as clothing, nor can you drive a derivative work. You cannot sail in them or fly in them. They cannot be used as tools of any useful trade. They are not computers, not machine tools, not pharmaceutical equipment, not agricultural implements.
Derivatives are therefore totally outside the realm of capital goods production needs, no matter how these may be defined.
FOR RECOVERY, WIPE OUT, SHRED, DELETE ALL DERIVATIVES
J.P. Morgan Chase, therefore, performs no useful or productive social function, and there is absolutely no reason in the world why the people of the United States should want to bail out this pernicious and socially destructive institution. It has probably been several decades since J.P. Morgan Chase created a single modern productive job. J.P. Morgan Chase’s strategic commitment in favor of the derivatives bubble means essentially that we can easily dispense with most of the functions of this self-styled “bank,” really a casino. Instead of being bailed out, J.P. Morgan Chase ought therefore to be seized by the Federal Deposit Insurance Corporation, and put through chapter 11 bankruptcy. In the course of that bankruptcy reorganization, the entire derivatives book of J.P. Morgan Chase must be deleted, shredded, used as a Yule log, or employed to stoke a festive bonfire of the derivatives. The world did much better when there were no derivatives, and will get along just fine without them.
Derivatives were of very dubious legality in general and were illegal in some of their specific forms until the mid-1990s.
INSTRUMENTS MEANS DERIVATIVES
According to Paulson’s pact with the devil published in the New York Times on September 20, 2008, the Secretary of the Treasury is supposed to be empowered by Congress to spend $700 billion on mortgage related securities, obligations, and instruments. That last word instruments is the favorite euphemism of television commentators and journalists who want to propose a derivatives bailout without using this word, which has now become to some degree unmentionable and taboo, presumably because of its highly negative connotations left over from the crises of more than a decade ago. Accordingly, one very good killer amendment that ought to be added to this pact with the devil should state that not one penny of taxpayer money should ever be used to finance the purchase of derivatives, no matter how they may be euphemistically referred to.
WHY BUY MORTGAGE BACKED SECURITIES THAT HAVE NO PRICE BID?
Paulson wants to buy up derivatives. But at what price? Derivatives have no intrinsic value. Like the rasbucknik in the old L’il Abner comic strip, derivatives have negative value, since somebody has to be paid to cart them away. Counterparty derivatives currently have no price, since there is no market where they are trading, and nobody would want to buy them if there were such a market. Collateralized debt obligations were selling at 5 cents on the dollar a few weeks ago, but that was well before the current crisis broke in its full fury. So how will Paulson know how much to pay for the derivatives he wants to purchase? Will he use the discredited Black-Sholes model, which led to the bankruptcy of the Long Term Capital Management hedge fund ten years ago? Given all this, the only price which can be assigned to the mass of derivatives is not their notional value, but rather a big fat ZERO. Anything else is stealing from the government.
“INVESTMENT BANKS” DRIVE UP THE PUMP PRICE OF GASOLINE
Let us now leave behind the category of the commercial banks and move on to institutions like Goldman Sachs and Morgan Stanley, the stock jobbing operations or counting houses that like to call themselves investment banks these days, even though they do not have the status of a commercial bank and are not members of the Federal Reserve. Why should any public money at all be used to prolong the noxious lives of these sociopathic and pernicious institutions? A short examination of what these so-called investment banks do will reveal that there is no public interest in keeping these creatures alive, and that, once again, touch better off without them.
Investment banks used to assist corporations and floating issues of stocks or bonds on the financial markets. Investment banks were supposed to function as the advisers of industrial corporations and other corporations as they sought to raise capital needed for new plant, equipment, and jobs. But today, these functions have virtually disappeared. The investment banks do a certain amount of work in initial public offerings for IPOs of new securities, but these are almost always of a financially speculative nature. The main thing is that investment banks now place bets on certain classes of assets in the hope of turning a purely speculative profit for themselves. Goldman Sachs and Morgan Stanley maintain trading desks and engage in purely speculative trading of assets which they themselves own, and most of the time these assets represent derivatives of one kind or another. In recent times, the most important asset class which Goldman Sachs and Morgan Stanley have been trading is probably future indices on commodities, especially oil. Goldman Sachs and Morgan Stanley between them have in the past year by various estimates accounted for about half of the speculative activity in the commodities markets of London, New York, and other money centers which brought about the doubling of the per barrel price of oil between July 2007 and July 2008, increasing the cost of gasoline to almost five dollars per gallon.
GOLDMAN SACHS, MORGAN STANLEY CREATE I.C.E. TO FLAY AMERICANS
In a very real sense, American motorists filling their gas tanks at the pump at exorbitant prices have been involuntarily subsidizing the speculative derivatives activity of Goldman Sachs and Morgan Stanley. How bitterly ironic that the same American motorists should now be taxed in order to permit their tormentors to live on and to continue to mercilessly loot them. Goldman Sachs and Morgan Stanley found that even the very weak regulatory regime maintained here in the United States under the auspices of the Commodity Futures Trading Commission was too onerous for them because it slightly constrained their rapacious quest for speculative profits at the expense of the American people. These two investment banks therefore created a new speculative commodity exchange, the ICE or Intercontinental Exchange located in London, with a regulatory regime is virtually nonexistent. The ICE or Intercontinental Exchange in London is where about half of the world futures contracts in oil have been trading in recent months.
Goldman Sachs and Morgan Stanley, like their now-defunct brethren Bear Stearns, Lehman Brothers, and Merrill Lynch, have also made many speculative investments in the area of mortgage backed securities based on predatory subprime mortgages. The adjustable rate mortgages that underlie these derivatives should have been declared illegal long ago. But now let us imagine what will happen if a hapless victim of these predatory lending practices is forced into foreclosure in the current world economic great depression.
Goldman Sachs will send the bailiff to your door to throw you, your family, and your belongings out on the street, even though you have been taxed to permit Goldman Sachs to continue its sociopathic existence. You will in effect be robbed out of one pocket even as you are being pushed out the door and made homeless by the same institution which has been the beneficiary of your forced charity.
Surely any politician daring to come forward to suggest the public bailout of Goldman Sachs so that it can continue to enforce foreclosures against the American citizens who are paying the bill for the financial excesses of this bandit institution ought to be tarred and feathered and run out of town on a rail. Yet this is exactly what Pelosi, Reid, Dodd, and Frank are proposing to force through the U.S. Congress in the coming week. This represents a new low in public morality.
With Fannie Mae and Freddie Mac, the situation is slightly different, but the same criteria ought to apply. Fanny and Freddie worked very well during the three decades after the formation of Fannie Mae in 1938 as an agency of the federal government — a hillbilly cousin of the US treasury, as it used to be called.
Things began to go wrong in 1968 when Fannie Mae was privatized, under the pernicious influence of the doctrines of the monetarist Milton Friedman of the infamous Chicago school of pseudo-economics and obscurantism. Fanny and Freddie have now been placed under the control of conservators, but they ought to be nationalized as part of a permanent state sector of the US economy, and operated as the public utility that they were intended to be. The salaries of their officials ought to be determined by the government-wide GSA schedule. Fannie and Freddie have guaranteed mortgages, and ought to continue to do so. But they have no obligation to guarantee mortgage backed securities or any other form of newfangled derivatives which were never mentioned in their charter.
Accordingly, Fannie and Freddie thought to strip away the mortgage backed securities that have been used to package or bundle the mortgages that they now hold. The mortgages represent a valuable asset for the future, under conditions of economic recovery which we intend to organize. But that extra layer of derivatives paper represents a useless additional tax on the public treasury, which the US government has no obligation to maintain. In short, it is time to separate the socially useful core of actual mortgages representing residential and commercial properties from the harmful and speculative overlay of the mortgage-backed security. By this kind of financial engineering, speculators can receive condign punishment, even as the public treasury is believed of an extra layer useless payment which would only reward speculative crimes.
If anyone should inquire as to the ultimate philosophical causes of the current George Bush world economic depression, the answer is simple: this depression is a direct result of the influence of Milton Friedman and the Chicago school, who are themselves to kind of come down American version of the Viennese school of Friedrich von Hayek. Ludwig von Mises, and other charlatans masquerading as economists. The common denominator of the Chicago school is the Vienna school which is represented by the right-wing anarchist thesis that government is always bad and the private sector, especially speculators, are always good. This absurd thesis is now being consigned to the dustbin of history. Friedman and von Hayek, if they were alive today, would doubtless demand the full fury of the free market the unleashed against the American people. This would lead, not to a recovery, but merely to death on a large scale.
The implications of the Chicago school and the Vienna school under current circumstances are nothing short of genocidal, and even the financiers are hastily dumping the discredited doctrines of Friedman and from Hayek as they rush to get their hands into the public till through bigger and better bailouts in an endless series. There is nothing anywhere in the world left today that might resemble a free market, only an endless list of cartels, trusts, monopolies, oligopolies, duopolies, and other conspiracies in restraint of trade. In fact, there has been nothing even vaguely resembling a free market in most of the world in the past several centuries. What is collapsing today in September 2008 is the delusion that such a thing as a free market might exist in the modern world.
The same negative judgment applies to the lunatic doctrines of Joseph Schumpeter, who preached the madness of creative destruction as a way out of the world economic depression of the 1930s.
Schumpeter’s doctrines today are nothing less than a public menace, and persons who demand a deflationary crash of the world economy by preaching the Andrew Mellon formula of liquidating labor, liquidating stocks, liquidating bonds, liquidating real estate, etc., are to be put in a padded cell. This is even worse than Herbert Hoover. It was tried in 1932-33, and it turned out to be a bottomless pit already then, so it does not need to be tried again.
BACK TO THE NEW DEAL: RESTORE THE GLASS-STEAGAL FIREWALL
Scribblers like Friedman and von Hayek were paid by finance oligarchs to wage a relentless war against that heritage of the Franklin D. Roosevelt New Deal, the set of policies which allowed humanity to survive the Great Depression of the 1930s. The current crisis would not have been possible in the present form if the institutional safeguards enacted during the New Deal had been left in place, as they should have been. These safeguards represent permanent features of civilization, and they need to be restored. The best example is the repeal of the Glass-Steagall Act under the Clinton administration in 1999. The Glass-Steagall Act was a classic piece of New Deal legislation which established that being a commercial bank and being a stockbroker are mutually exclusive activities that could not be legally combined in the same company.
Commercial banking was one thing, and stock brokerage was something completely separate. Naturally, the greedy financiers and their spokesmen clamored for the repeal of Glass-Steagall, and they finally got their wish. Now less than 10 years later all of the Wall Street banks, seemingly without notable exceptions, are bankrupt and insolvent institutions that cannot not survive without a massive infusion of taxpayer money. We need to restore Glass- Steagal, which will mean among other things that Goldman Sachs and Morgan Stanley will not be eligible to become bank holding companies after all. If you don’t like your tax bill next year, you should thank Newt Gingrich and others who made it their business to destroy and roll back the achievements of the New Deal in the name of the despicable ideology of monetarism as preached by Friedman and von Hayek. Newt, by the way, is now calling for an immediate deflationary crash to find out what the real prices of housing might be. This is like doing experiments on your own flesh, and Newt should go to the funny farm.
BACK TO THE NEW DEAL: RESTORE THE UPTICK RULE
Another example is the uptick rule. This New Deal measure meant that it was illegal to sell a stock short if it were continuously in decline. The speculator had to wait until there was an uptick, meaning a trade in which the stock in question increased in price; only then could a short sale be carried out. Another piece of bitter irony inherent in the present crisis is that this uptick rule was abolished by the feckless and incompetent Chairman Cox of the Securities and Exchange Commission at the beginning of last summer, just in time for the explosion of the world credit crisis which has led to the current world economic depression. Incredibly enough, Chairman Cox of the SEC has been unable to pull himself together long enough to permanently re-impose the uptick rule.
Instead, he has drawn up a list of 799 financial institutions and banks whose stock will now be illegal to sell short for at least 10 days, although one suspects that this prohibition will be prolonged indefinitely. This crackpot expedient reveals the true nature of the current monetarist regime. Shorting and destroying General Motors, which actually produces something useful, is fine, but no shorting of JP Morgan Chase, which is a public menace that produces nothing but toxic paper. The long-term roots of the current crisis go back to August 15, 1971, when Nixon, Kissinger, Arthur Burns and George Shultz wantonly destroyed the Bretton Woods system of fixed currency parities, ushering in the new world of financial risk which is now collapsing around us.
NATIONALIZE THE FEDERAL RESERVE AS A BUREAU OF THE TREASURY
The present crisis ought to provide the death warrant for the failed Federal Reserve System. When the Fed was created back under Woodrow Wilson, its Rockefeller and Morgan sponsors promised that the Fed would protect us against all future financial panics. The Fed failed once in 1929-1933, and now it is failing again for a second time. The Fed is worthless as a firewall against depression. We must therefore seize the Fed, audit it, nationalize it, and operate it in the future as a bureau of the US Treasury. From now on, we must go back to the Constitution, meaning that the size of the money supply and short-term interest rates will have to be determined by public laws of the United States, passed by the House and the Senate and signed by the president. Using this method, we can mandate new initial credit issues of $1 to $2 trillion to be used exclusively as low interest (.5% to 1%) and long-term (30 to 40 year maturities) credit for productive purposes only manufacturing, farming, mining, commerce, energy production, infrastructure, and the other things we need. We should stop having the Fed lend money to Citibank at 2% and then having the Treasury borrow that same money back for 4% to 5% in the form of Treasury paper. Nationalize the Fed, and let the Treasury finance itself, cutting out the parasitical middlemen like JP Morgan Chase, Goldman, Citibank, and the rest. The taxpayers will be the big winners.
HOOVER’S RECONSTRUCTION FINANCE CORPORATION WAS A FAILURE
The Paulson-Bernanke $700 billion is roughly comparable (factoring in about 2000% inflation from 1932 to 2008) to the Herbert Hoover Reconstruction Finance Corporation, which started with $2 billion real 1932 dollars, but failed because it tried to prop up insolvent banks and shore up collapsing financial values. Under FDR, the RFC was put under Jesse Jones, who used it to create real plant and equipment with great success. Under Jones, the RFC contributed decisively to US economic recovery by building up the Metals Reserve Company, the Rubber Reserve Company, the Defense Plant Corporation, the Defense Supplies Corporation, the War Damage Corporation, the U.S. Commercial Company, the Rubber Development Corporation, and the Petroleum Reserve Corporation. In other words, the RFC under Jones rebuilt the industrial infrastructure which we have been using down to the present day. Most of these investments represented added physical commodity production. Today, this could be repeated to produce infrastructure and energy plants for civilian use.
CLEARING THE DECKS FOR WORLD ECONOMIC RECOVERY
It is time to forget about paper and the price of paper, and to concentrate on production securing the tangible physical commodities and hard commodity production which are necessary for human life and civilization. It is impossible to prop up financial values in a panic, and it is foolish to try. To secure a decent future, we must now enact the following measures. Any of these points, all of which seek to defend the general welfare and the public interest, can and should be used as killer amendments to be attached to the current bailout monstrosity as a means of bringing it down.
Stop all foreclosures on homes, farms, businesses, factories, mines, transport systems, for a period of at least five years or for the duration of the present world economic depression, whichever takes longer. If you throw a family out of their home or shut down a family farm, taxicab company, trucking firm, ferry, airline, railroad, or factory of any kind because of debt, you will be on your way to Leavenworth. All politicians now say that we have to keep families in their homes. Excellent! A uniform federal law with real teeth is the way to do it.
Seize bankrupt banks and financial institutions. Put them through Chapter XI bankruptcy, and cancel the hopelessly unpayable parts of their debts, starting with their derivatives book.
Wipe out all derivatives, whether exchange traded or counterparty, without compensation. They have always been illegal. They are now a threat to all of our lives. Not one penny of public money must go to buy derivatives.
Securities transfer tax or Tobin tax on all financial transactions, including stocks, bonds, foreign exchange, etc. This is a sales tax on finance oligarchs who need to start paying their fair share. This will take the life out of the booze for many speculators.
Stop oil, food and commodity speculation with comprehensive re- regulation including position limits, 50 to 100% margin requirements depending on market conditions, and by distinguishing between legitimate hedgers and predatory speculators.
No tax increases on households. Surtax for foundations like the Ford, Rockefeller, Carnegie, Annenberg, and Gates Foundations, who use their funds not for charity but for subversion and divide and conquer social engineering to divide and weaken the American people in defense of the financier interest.
Restore business confidence and credit with new credit issue through the nationalized Federal Reserve, operating under the legal auspices of the US Treasury. Use credit as a public utility. Provide cheap, long-term credit for productive purposes only, not parasitical speculation or financial services.
Institute an absolute guarantee for Social Security, Medicare, Medicaid, Head Start, WIC, food stamps, unemployment insurance, and the other remaining elements of the social safety net. No “entitlement reform” under any circumstances. Austerity for bankers, not people. Use the proceeds from the Securities Transfer Tax to replenish the Social Security Trust Fund and preserve the other vital programs through the end of the twenty-first century.
Using New Deal methods, it is possible to stop a depression cold in a single day. We did it before, and we can do it again. Only 28% of the American people now support the monstrous derivatives bailout, with 37% opposed and 35% unsure, according to Rasmussen on Sept. 22. This is an issue powerful enough to crystallize the current party re-alignment in the same way that slavery in the territories did in 1860, or the last depression did in 1932. Within a month, the current empty husks of the gutted Democratic and Republican Parties could collapse, and be replaced by the pro-Wall Street Bailout Party led by Obama and his phalanx of rich elitists and Malthusian fanatics from both parties, and the pro-middle class and pro-worker Anti-Bailout Party with support from right-wing Republicans, libertarians, and working class Democrats. Who will have the brains and guts need to assert leadership over the Anti- Bailout Party? Will it be McCain? Or Hillary Clinton? Or someone else? We will soon find out.
UN chief calls for ‘global leadership’
http://www.breitbart.com/article.php?id=080923141957.0wwwqogq&show_article=1
AFP
UN chief Ban Ki-moon on Tuesday stressed the need for “global leadership” as he pressed world leaders not to pursue narrow national interests in the face of hard economic times.
“I see a danger of nations looking more inward, rather than toward a shared future,” he said at the opening of the UN General Assembly’s annual debate.
He spoke of a “challenge of global leadership” to tackle the world’s worsening financial, energy and food crises.
“We see new centers of power and leadership — in Asia, Latin America and across the newly developed world,” Ban told more than 120 heads of state or government, including Presidents George W. Bush of the United States and Nicolas Sarkozy of France.
“In this new world, our challenges are increasingly those of collaboration rather than confrontation,” he added.
“Nations can no longer protect their interests, or advance the well-being of their people, without the partnership of the rest.”
On the world’s current financial crisis, the UN secretary general stressed the need to “restore order to the international financial markets”.
“We need a new understanding on business ethics and governance, with more compassion and less uncritical faith in the ‘magic’ of markets,” the UN boss said.
Ban, who has chosen implementation of key poverty reduction goals as a major theme of this year’s debate, said he saw “a danger of retreating from the progress we have made, particularly in the realm of development and more equitably sharing the fruits of global growth.”
“Global growth has raised billions of people out of poverty. However, if you are among the world’s poor, you have never felt poverty so sharply.”
On Thursday, he will host a summit meeting on implementation of the poverty reduction Millennium Development Goals (MDGs) on the margins of the General Assembly session.
Ban said he would use Thursday’s summit to press world leaders, the private sector, foundations, and civil society to make “ambitious and concrete” proposals to ensure that these goals are implemented by a 2015 deadline.
Monday, a summit meeting on Africa’s development needs adopted a political declaration urging rich countries to honor their pledge to double their annual aid to the continent, which is struggling to meet the MDGs.
And returning to the theme of global leadership, Ban told the assembly: “It takes leadership to honor our pledges and our promises in the face of fiscal constraints and political opposition.
“It takes leadership to commit our soldiers to a cause of peace in faraway places. It takes leadership to speak out for justice. To act on climate change despite wonderful voices against you.”
A Breathtaking Insult to the Constitution: Bail Out on This Bailout
I’m not usually a fan of the Rev. Jackson; he comes across as a one-message speaker. However, in this case, I happen to agree with him. Bailing out the failing banks would only postpone the inevitable. The best way to deal with this crisis is to let the banks fail: no bail-out, no buy-out, no major compensation for those execs who let this happen. While I do feel bad for those who were suckered into purchasing homes they could hardly afford, the fault lies directly with them. If you can’t afford it, don’t buy it. People need to start taking responsibility for their actions. Before the market crash in the ’20s, it is reported that Joe Kennedy overheard an elevator operator talking about the stocks he owed and the killing he was going to make on their sale. Kennedy decided that this was a good time to get out of stocks. Now, I might have made a mistake; it might not have been Kennedy. However the moral of the story is the same.
We purchased our home two years ago. We wanted the single-family home with the 3/4 acre yard, but we bought the townhouse with a small fenced-in yard. Why? Because we would have been too stretched financially. Does this mean we’re smarter than the average bear? Of course not. But we didn’t want to lose our home because of our own stupidity. And yes, the banks were more than willing to lend us the money for the bigger place. We might now be in a situation where we’d be homeless. Not a good place to be.
http://www.propagandamatrix.com/articles/September2008/240908Breathtaking.htm
A Breathtaking Insult to the Constitution: Bail Out on This Bailout
Rev. JESSE JACKSON, Sr.
Counterpunch
Wednesday, Sept 24, 2008
Are we witnessing the death of the republic? Sound hysterical? Look at how Treasury Secretary Hank Paulson proposes to govern the $700 billion — some $2,000 for every man, woman and child in America — that he wants to bail out the banks.
He wants the power to buy “Troubled Assets from any Financial Institution . . . on such terms and conditions as determined by the Secretary,” and his decisions “may not be reviewed by any court of law or any administrative agency,” according to the text of the U.S. Treasury Department’s legislative proposal. In other words, give him the $700 billion to spend as he sees fit and shut up.
The occasion for this breathtaking insult to the Constitution is the worst financial meltdown since the Great Depression. Essentially, we are being held for ransom: Give us the money on our terms or the banks will take down the global economy.
We know how we got here. Decades of reckless economic policies and batty ideas — deregulation, disemboweling regulatory agencies, allowing a shadow banking system to develop without limits, market fundamentalists preaching nonsense about markets always being efficient and self-correcting — left Wall Street’s speculators free to gamble on their own. They borrowed heavily, invented complex new instruments, and pocketed millions along the way. Much of it depended on housing prices going up. Predatory lenders huckstered complicated loans to folks, with no stake in whether they had any chance to repay them.
When housing prices peaked out, banks found themselves with billions in toxic paper, and trillions in exposed credit swaps. Now they want free use of $700 billion, which they say will get the crisis under control.
Treasury Secretary Paulson says Congress must act immediately. Well, wait just one minute. If it takes $700 billion to bail out Paulson’s former colleagues on Wall Street, some basic questions have to be answered:
Who pays? The rewards of the economic growth of the last decade went overwhelmingly to the wealthiest Americans. Send the bill to those who had the party. We need an excise tax on high incomes to pay for cleaning up the mess.
Who decides? We can’t allow the folks who helped create the mess be in charge of cleaning it up. We need an independent entity, governed by a board with union and consumer representation and the power to make the rules for any bailout.
Who benefits? If taxpayers are bailing out banks, taxpayers should get partial ownership — so if the banks do return to profitability, we get some of our money back.
Who gets helped? We can’t just bail out Wall Street and ignore Main Street. The bailout must be bottom up, not just top-down. Any bailout must include provisions for renegotiating mortgages, freezing foreclosures and keeping people in their homes.
What gets the economy going? It’s not enough to bail out the banks. We need serious public investment in the real economy — in rebuilding schools and sewers, in green jobs and conservation that will put people back to work.
Who is independent? The oversight committees and the overseers must come off Wall Street’s payroll. Financial industry lobbyists should be banned from the beltway for the next year. Legislators=2 0should refuse Wall Street PAC and executive donations for at least the next two years.
Who is accountable? No executive of a firm that is bailed out should be paid more than the president of the United States.
Will the Congress act with the wisdom to put us back on track? Or will it squander even more money on Wall Street without making America better? We’d better help Congress make the right choice.
North American Union: The SPP is a “hostile takeover” of democratic government and an end to the Rule of Law
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A great review of the SPP and what it means for us as Canadians. I would recommend that all readers go visit the Canadian Action Party’s website (http://www.canadianactionparty.ca) They are the only political party in Canada to actually address issues that are important. Look at the current crop of leaders. If you squint your eyes when they’re speaking, it’s difficult to say which is which. It’s all the same, simply wrapped up in a different coloured package. Regardless of who is elected, there are a few things that we, as Canadians, that we can count on. Taxes will go up, programs and services will be cut, jobs will be lost, Parliamentarians will vote to increase their salaries. Nice.
North American Union: The SPP is a “hostile takeover” of democratic government and an end to the Rule of Law
By Constance Fogal
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Global Research, August 2, 2007
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Connie Fogal says the SPP is the “hostile takeover” of the apparatus of democratic government and an end to the “rule of law”. There has been a kind of coup d’état over the government operations of Canada, U.S.A. and Mexico. The first formal step towards the NAU was NAFTA. Ron Pastor of the Council on Foreign Relations has affirmed that. The Canadian Action Party, a registered federal sovereigntist political party in Canada, began as a party in 1997 precisely because none of the mainstream parties were calling for the clear, outright, unequivocal abrogation of NAFTA, or for control of our national monetary system. Even now, our mainstream Canadian political parties and significant citizen groups are still stuck on re-negotiation of NAFTA (they talk of fair trade) which completely misses the point. As such, they remain blinded, and of no use to the citizens who care about our nation and our sovereignty, our independence, our civil liberties, our civil rights, our culture, our freedom . The second formal step was the integration and subjugation of Canada’s military into the US military command under NORAD, NORTHCOM, and the Bi-National Planning Agreement. That is why our Canadian military is in Afghanistan. The third formal step in the creation of the NAU was the implementation of the respective liberty-stripping anti-terrorist legislations, the Patriot Act in the USA and the Anti-terrorist Act in Canada. This has been the mechanism to implement the police state apparatus necessary to enforce Fortress America. The fourth formal step is the SPP, Security and Prosperity Partnership Agreement. That agreement is a “hostile takeover” of the Executive branch of government, a coup d’état over the government operations of Canada, U.S.A. and Mexico. The three branches of democratic governance are: 1, the legislative arm, i.e., the policy makers, the people we elect; 2, the judicial arm, i.e., judges who interpret and apply the laws created by the policy makers; and 3, the executive arm, i.e., the civil service, the bureaucracy, who implement and run the policy and operations of government. The SPP is a treasonous metamorphosis of our federal and provincial government bureaucracies into formal instruments to implement the agenda of the shadow government – the military/ industrial/ financial complex exemplified by the Canadian Council of Chief Executives who in turn are dominated by the U.S Council on Foreign Relations, and the US military apparatus. The S.P.P. has created the competitiveness council (10 to 16 people from industry and academe unelected by citizens, unaccountable to citizens, unrepresentative of citizens ) in each of Canada, U.S.A., and Mexico. They meet with our Prime Minister and the two Presidents. They actively direct the restructuring of the civil service apparatus and governance of Canada, U.S., and Mexico away from instruments serving the public interest and nationhood, and into tools to serve the power and greed of the industrial, financial, military complex. This Competitiveness Council will be at Montebello directing the three leaders in August, 2007 finalizing the last steps of the NAU. Since March, 2005, under the direction of three senior cabinet ministers of each country, about 100 working groups of unelected officials from government and industry have been meeting at taxpayer expense deciding on and directing the implementation of the restructuring of the apparatus of governance and the form of rule over the people. Their command goes out down the chain of bureaucracy expending vast amounts of taxpayer dollars implementing the changes in our border crossings, in our airports, on our airplanes, in our skies, on and to our roads and highways, in our personal identification systems, in our health, in our vaccines, over our food supplements, in our pesticide safety levels, in our schools and universities, in the exploitation of our natural resources-our rivers, lakes, oil, gas, in our environment, in the arms industry, in the manufacture and use of depleted uranium, in the exploitation of and experimentation on our indigenous people and our military personnel, in immigration, over our right of Habeus Corpus, in our right of due process, our right to assemble and our freedom of speech, etc., etc. Government of the people, by the people, for the people has been eliminated while those people we have elected stand idly in the sidelines apparently blissfully oblivious, or deliberately careless of the termination of their policy making role except as a rubber stamp. Those we have elected have abused their responsibility to protect our power, the people’s power. They have permitted an undemocratic elite to control them and the operation of government. It is by us, the general citizenry, that Members of Parliament and Members of Legislative Assemblies and city councillors,and Senators and congressmen are supposed to be ruled in all matters, not by the military/ industrial/ complex that General Dwight D. Eisenhower warned about on his final address to his nation. The Prime Minister and Presidents along with their most senior Cabinet members and officials really now do apply a “Divine Right of Kings” mentality to their role. They have metamorphosed into a cancer rotting the life out of our democracies. For this reason the Canadian Action Party calls for electoral reform not just in how we elect candidates, but why and how the bureaucracy operates. In particular, we call for a curb on the exercise of power in the executive branch of government, and especially in the P.M.s office. This need is of paramount importance because it is the key to why and how three nations (Canada, USA, Mexico) are being dismantled. Remember, if you believe in democratic accountable representation, there must be a universal franchise. Government of the people, by the people, for the people still is right. It is not government by officials of any organization or interest group whether public or private who are unelected by, unrepresentative, and unaccountable to the general public. We need to reform our government structure so that we can recall and replace any person we elect when they fail to keep their promise or do their duty to us, the citizenry; and, we also need to turn our executive arm of government back to being the servant of the citizens. The Security and Prosperity Partnership Agreement (S.P.P) is deliberately not a formal international treaty such as NAFTA which is set out in a system of rule by international law. As a legal treaty the SPP would never have flown because it would have been exposed to scrutiny. It remains a work in progress agreement of incredible treacherous magnitude. It has already succeeded in implementing profound changes to three nations integrating the geographical region of North America. We do not even know the full extent of what has been completed or what little is left to be accomplished.. We know that a powerful think tank chaired by former Sen. Sam Nunn and guided by trustees including Richard Armitage, Zbigniew Brzezinski, Harold Brown, William Cohen and Henry Kissinger, is in the final stages of preparing a report to the White House and U.S. Congress on the benefits of integrating the U.S., Mexico and Canada into one political, economic and security bloc. We know that the final report, published in English, Spanish and French, is scheduled for submission to all three governments by Sept. 30, according to the <http://www.csis.org/> Center for Strategic & International Studies. We know that the data collected for the report is based on seven secret roundtable sessions involving between 21 and 45 people and conducted by CSIS. The participants are politicians, business people, labour leaders and academics from all three countries with equal representation. We know all this because it is described in a CSIS report, <http://www.canadians.org/water/documents/NA_Future_2025.pdf> “North American Future 2025 Project.” It will be interesting to see who the think tank representatives will be that appear before our Canadian Parliament and how it is presented since so many of our Canadian MP’s deny this integration is happening. They need to realize that the vote still works in Canada and if they want to be re-elected, they must repel the submissions for integration. In fact, their duty to us is to refuse to hear such a delegation. SInce when has it become lawful to entertain discussion or debate on any form of treason?? This kind of presentation by such influential players will likely be a formalization of the integration as a done deal. We, the citizens, must demonstrate to our governments that we demand an end to the integration of North America . And, we must tell them we are not asking for a front row seat at our hanging party. We do not want to be involved or to have them involved in any negotiations or discussions or debate about how our nations are to die. We already know we do not want a North American Union, period!!! They must repel the formal instructions coming to them this fall from the shadow government. In recognition of our sovereign democratic rights and powers as citizens promulgated by the respective founding fathers of three nations, the Canadian Action Party calls upon all Canadians to join with our neighbours in the USA and Mexico to stand and defend our distinctive nations, NOT TO CALL FOR DEBATE AND DISCUSSION ON INTEGRATION. We must DEMAND SOVEREIGNTY AND INDEPENDENCE We must make a sound and sight so that uninformed citizens can be alerted. How can we do this? Right now, focus on being at the 25 km perimeter around Montebello, Quebec on August 20 and 21, 2007. In a separate e mail I will send suggestions about Montebello actions Connie Fogal Leader is leader of the Canadian Action Party (CAP/PAC) |
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Canada’s Sovereignty in Jeopardy: the Militarization of North America
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Canadians have, until recently, always been a complacent bunch. We usually take things as they come, and as long as we aren’t too put out, we accept them. However, as this article shows, we need to start taking our own sovereignty much more seriously. While we do need to have a good working relationship with our neighbours to the South, we cannot forfeit our country and values and get assimilated. If we do not start asserting ourselved, we will be in big trouble. NAFTA needs to be abrogated. If the next US president wants to re-open the discussions, we need to make sure that our own needs are taken care of first, and that agreements drawn up are actually fair and not slanted to favor one nation over another.
Canada’s Sovereignty in Jeopardy: the Militarization of North America
By Michel Chossudovsky
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Global Research, August 17, 2007
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Canadian jurisdiction over its Northern territories was redefined, following an April 2002 military agreement between Ottawa and Washington. This agreement allows for the deployment of US troops anywhere in Canada, as well as the stationing of US warships in Canada’s territorial waters. Following the creation of US Northern Command in April 2002, Washington announced unilaterally that NORTHCOM’s territorial jurisdiction (land, sea, air) extended from the Caribbean basin to the Canadian arctic territories.
NORTHCOM’s stated mandate was to “provide a necessary focus for [continental] aerospace, land and sea defenses, and critical support for [the] nation’s [US] civil authorities in times of national need.” (Canada-US Relations – Defense Partnership – July 2003, Canadian American Strategic Review (CASR), Former Secretary of Defense Donald Rumsfeld boasted that “the NORTHCOM – with all of North America as its geographic command – ‘is part of the greatest transformation of the Unified Command Plan [UCP] since its inception in 1947.’” (Ibid) Canada and US Northern Command In December 2002, following the refusal of (former) Prime Minister Jean Chrétien to join US Northern Command (NORTHCOM), an interim bi-national military authority entitled the Binational Planning Group (BPG) was established. Canadian membership in NORTHCOM would have implied the integration of Canada’s military command structures with those of the US. That option had been temporarily deferred by the Chrétien government, through the creation of the Binational Planning Group (BPG). The BPG’s formal mandate in 2002 was to extend the jurisdiction of the US-Canada North American Aerospace Defense Command (NORAD) to cover sea, land and “civil forces”,
Although never acknowledged in official documents, the BPG was in fact established to prepare for the merger of NORAD and NORTHCOM, thereby creating de facto conditions for Canada to join US Northern Command. The “Group” described as an “independent” military authority was integrated from the outset in December 2002 into the command structures of NORAD and NORTHCOM, both operating out the same headquarters at the Paterson Air Force base in Colorado. In practice, the “Group” functioned under the jurisdiction of US Northern Command, which is controlled by the US Department of Defense. In December 2004, in the context of President Bush’s visit to Ottawa, it was agreed that the mandate of the BPG would be extended to May 2006. It was understood that this extension was intended to set the stage for Canada’s membership in NORTHCOM. In March 2006, two months before the end of its mandate, the BPG published a task force document on North American security issues:
The BPG task force report called for the establishment of a “maritime mission” for NORAD including a maritime warning system. The report acted as a blueprint for the renegotiation of NORAD, which was implemented immediately following the release of the report. On April 28, 2006, an agreement negotiated behind closed doors was signed between the US and Canada. The renewed NORAD agreement was signed in Ottawa by the US ambassador and the Canadian Minister of Defense Gordon O’Connor, without prior debate in the Canadian Parliament. The House of Commons was allowed to rubberstamp a fait accompli, an agreement which had already been signed by the two governments.
While NORAD still exists in name, its organizational structure coincides with that of NORTHCOM. Following the April 28, 2006 agreement, in practical terms, NORAD has been merged into USNORTHCOM. NORTHCOM Commander Gen. Gene Renuart, USAF happens to be Commander of NORAD, Maj. Gen. Paul J. Sullivan who is NORTHCOM Chief of Staff, is Chief of Staff of NORAD. With a exception of a token Canadian General, who occupies the position of Deputy Commander of NORAD, the leadership of NORAD coincides with that of NORTHCOM. (See photo gallery below). These two military authorities are identical in structure, they occupy the same facilities at the Peterson Air Force base in Colorado. There was no official announcement of the renewed NORAD agreement, which hands over control of Canada’s territorial waters to the US, nor was there media coverage of this far-reaching decision. The Deployment of US Troops on Canadian Soil At the outset of US Northern Command in April 2002, Canada accepted the right of the US to deploy US troops on Canadian soil.
With the creation of the BPG in December 2002, a binational “Civil Assistance Plan” was established. The latter described the precise “conditions for deploying U.S. troops in Canada, or vice versa, in the aftermath of a terrorist attack or natural disaster.” (quoted in Inside the Army, 5 September 2005). Canadian Sovereignty In August 2006, the US State Department confirmed that a new NORAD Agreement had entered into force, while emphasizing that “the maritime domain awareness component was of ‘indefinite duration,’ albeit subject to periodic review.” (US Federal News, 1 August 2006). In March 2007, the US Senate Armed Services Committee confirmed that the NORAD Agreement had been formally renewed, to include a maritime warning system. In Canada, in contrast, there has been a deafening silence. In Canada, the renewed NORAD agreement went virtually unnoticed. There was no official pronouncement by the Canadian government of Stephen Harper. There was no analysis or commentary of its significance and implications for Canadian territorial sovereignty. The agreement was barely reported by the Canadian media. Operating under a “North American” emblem (i.e. a North American Command), the US military would have jurisdiction over Canadian territory from coast to coast; extending from the St Laurence Valley to the Queen Elizabeth archipelago in the Canadian Arctic. The agreement would allow for the establishment of “North American” military bases on Canadian territory. From an economic standpoint, it would also integrate the Canadian North, with its vast resources in energy and raw materials, with Alaska. Ottawa’s Military Facility in Resolute Bay Ottawa’s July 2007 decision to establish a military facility in Resolute Bay in the Northwest Passage was not intended to reassert “Canadian sovereignty. In fact quite the opposite. It was established in consultation with Washington. A deep-water port at Nanisivik, on the northern tip of Baffin Island is also envisaged. The US administration is firmly behind the Canadian government’s decision. The latter does not “reassert Canadian sovereignty”. Quite the opposite. It is a means to eventually establish US territorial control over Canada’s entire Arctic region including its waterways. This territory would eventually fall under the jurisdiction of US Northern Command (NORTHCOM). The Security and Prosperity Partnership Agreement (SPP) The Security and Prosperity Partnership Agreement (SPP) signed between the US, Canada and Mexico contemplates the formation of a North American Union (NAU), a territorial dominion, extending from the Caribbean to the Canadian arctic territories.
The SPP is closely related to the Binational Planning Group initiative. An Independent Task Force sponsored by The Council on Foreign Relations calls for the transformation of the North American Aerospace Defense Command (NORAD) into a “multiservice Defense Command”. The CFR document entitled “North American Community” drafted on behalf of the SPP endorses the BPG March 2006 recommendations:
The accession of Canada to this Multiservice Defense Command, as recommended by the CFR, has already been established, signed and sealed, approved by the Canadian Parliament in May 2006, in the context of the renewal of the NORAD agreement. In all likelihood, the formal merging of “the renewed NORAD” and US NORTHCOM will be on the agenda at the August Security and Prosperity Partnership Agreement (SPP) Summit meeting of President Bush, Prime Minister Harper and President Calderon at Montebello, Quebec. This decision would lead to the formation of a US-Canada NORTHCOM, with a new name, but with substantially the same NORTHCOM rhetorical mandate of “defending the Northern American Homeland” against terrorist attacks. The military of both the US and Canada would also be called to play an increasing role in civilian law enforcement activities. The real objective underlying the SPP is to militarize civilian institutions and repeal democratic government. “Integration” or the “Annexation” of Canada? Canada is contiguous to “the center of the empire”. Territorial control over Canada is part of the US geopolitical and military agenda. It is worth recalling in this regard, that throughout history, the “conquering nation” has expanded on its immediate borders, acquiring control over contiguous territories. Military integration is intimately related to the ongoing process of integration in the spheres of trade, finance and investment. Needless to say, a large part of the Canadian economy is already in the hands of US corporate interests. In turn, the interests of big business in Canada tend to coincide with those of the US. Canada is already a de facto economic protectorate of the USA. NAFTA has not only opened up new avenues for US corporate expansion, it has laid the groundwork under the existing North American umbrella for the post 9/11 integration of military command structures, public security, intelligence and law enforcement. No doubt, Canada’s entry into US Northern Command will be presented to public opinion as part of Canada-US “cooperation”, as something which is “in the national interest”, which “will create jobs for Canadians”, and “will make Canada more secure”. Ultimately what is at stake is that beneath the rhetoric, Canada will cease to function as a Nation:
But there is something perhaps even more fundamental in defining and understanding where Canada and Canadians stand as nation. By endorsing a Canada-US “integration” in the spheres of defense, homeland security, police and intelligence, Canada not remains a full fledged member of George W. Bush’s “Coalition of the Willing”, it will directly participate, through integrated military command structures, in the US war agenda in Central Asia and the Middle East, including the massacre of civilians in Iraq and Afghanistan, the torture of POWs, the establishment of concentration camps, etc. Canada would no longer have an independent foreign policy. Under an integrated North American Command, a North American national security doctrine would be formulated. Canada would be obliged to embrace Washington’s pre-emptive military doctrine, its bogus “war on terrorism which is used as a pretext for waging war in the Middle East. . The Canadian judicial system would be affected. Moreover, binational integration in the areas of Homeland security, immigration, policing of the US-Canada border, not to mention the anti-terrorist legislation, would imply pari passu acceptance of the US sponsored police State, its racist policies, its “ethnic profiling” directed against Muslims, the arbitrary arrest of anti-war activists.
NORTHCOM LEADERS
Source: NORTHCOM and NORAD websites. |
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