The People of Venezuela and USA – FIND PEACE!

Open Letter to the People and Government of the United States of America by the People of Venezuela

The people of Venezuela wish to address the people of the United States of America. You must know that on August 11, 2017, President Donald Trump threatened the Bolivarian Republic of Venezuela with direct military intervention. This dangerous threat was rejected by all nations and by the people of the United States. Nevertheless two weeks later President Trump imposed severe and unfair sanctions on us, publicly admitting his intention was to economically isolate Venezuela. It is the same strategy – recognised by the US government – that was implemented to overthrow the democratic government of Chile in 1973, paving the way for the ruthless dictatorship of August Pinochet to take power.

These threats and unilateral decisions will affect our economy and our means to obtain resources for food, healthcare and production, seriously impairing our citizens’ everyday life. President Trump seeks to manufacture a political crisis in our country by forcing President Nicolas Maduro out of office, even though he was democratically elected in 2013. Furthermore, these actions also affect ordinary US citizens who would face the possibility of a hike in gasoline prices, while thousands of workers risk losing their hard earned savings as retirement funds are affected by the ban on Venezuelan bonds.

This behaviour is inconsistent with Donald Trump’s campaign slogan: “Make America great again”. Rather it creates new problems, both inside and outside United States, making life harder for both Venezuelans and millions of US citizens, while at the same time it generates global rejection and resentment towards the US government and indirectly towards its people, who have nothing to do with these warmongering actions.

As was the case in Iraq, we might be on the verge of unfair and baseless military intervention, where oil is paramount. Yet nothing can justify that young Americans are driven into another military conflict, much less if it entails confronting friendly and peaceful countries such as Venezuelan.

Venezuela is neither an enemy of the United States ,nor does it represent a threat to its security. We admire its history, culture and scientific achievements. It is, therefore, imperative to cease this irrational policy of aggression and instead promote political understanding so this long tradition of friendship between both countries can be made to flourish.

The people of the United States are people of peace, and we believe that you should lead efforts seeking to neutralise the jingoist intentions of your government. That is why we reach out to you in fraternity and sincerity, to urge all Americans of goodwill to join us in working together for the defence of other people’s freedoms, our children’s well-being, towards cooperation and peace for our region. It is a time for dialogue and understanding. Let us not miss this opportunity and in the words of John Lennon: Let’s give peace a chance

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The World˙s Capitalists, Bankers and the State of Capitalism

From Jackson Hole to the Teton Heights?

August 24, 2017

At the end of every August, the central bankers of the world meet in the ski resort of Jackson Hole, Wyoming, USA to discuss the state of the world economy and the role of monetary policy in improving it.  These central bankers hear presentations from top mainstream academic economists and make speeches on how they see things.  This year, the symposium starts today with both Janet Yellen, head of the US Federal Reserve (to be replaced by Trump next year) and Mario Draghi of the European Central Bank delivering an address.

In previous years, the main theme has been on how to ease monetary policy (ie lower interest rates and print more money) in order to save the banking system and stimulate the capitalist economy into recovery from the Great Recession.

In 2013, the cry was for ‘quantitative easing’ (QE).  This was the policy idea that central banks, as the ‘last lender of resort’, would pump money into the economy by buying all sorts of financial assets from the commercial banks and other financial institutions (mainly government bonds, but also corporate bonds, mortgage bonds and even stocks and shares).  In this way, they would fill the coffers of the banks with funds to lend on to households and corporations.

This ’unconventional monetary policy’ was adopted by the Fed, the ECB and the Bank of Japan big time. The balance sheets of these central banks rocketed.  The US Fed now has $4trn worth of bonds and other assets on its books, funded by the creation of more dollars.  The ECB is heading for over $3trn too after it launched another QE program in 2015.

And the BoJ’s QE plans have taken its balance sheet up to 75% of the equivalent of Japan’s GDP!

But has it worked?  The answer is no.  Back in 2013, the Jackson Hole attendees were told by Vasco Curdia and Andrea Ferrero at the Federal Reserve Bank of San Francisco (Efficacy of QE) that the Fed’s QE measures from 2010 had helped to boost real GDP growth by just 0.13 percentage points and the bulk of this ‘boost’ was thanks to ‘forward guidance’, namely convincing investors that interest rates were not going to rise.  If that factor had been left out, the US real GDP would have risen only 0.04 per cent as a result of QE.

Two years later, Stephen Williamson,vice-president of the Federal Reserve Bank of St Louis,  issued a study in which he concluded : “There is no work, to my knowledge, that establishes a link from QE to the ultimate goals of the Fed – inflation and real economic activity. Indeed casual evidence suggests that QE has been ineffective.”

This ought to have been no surprise because back in the 1930s during the Great Depression, John Maynard Keynes also concluded after a few years that quantitative easing was a failure.  Pumping money into the banks did not boost the post-1929 US economy.  Eventually, Keynes opted for fiscal spending and government investment as the only policy to get out of the 1930s depression.

Indeed, all QE has done is to create a huge bubble in the stock markets of the world, while economic growth has remained sluggish at average rates less than half before the Great Recession and real incomes for the average household (who had no stocks) flat or falling.

Nevertheless, under the influence of the monetarist school of mainstream economics founded by ‘free market monetarist’ Milton Friedman and expounded by his follower, former Fed chief Ben Bernanke, the central banks continued with QE.

At the beginning of 2016, the fear was that the major capitalist economies were slipping into a debt deflation slump and something new had to be done. Indeed, some central banks resorted to even more desperate measures of not just reducing the ‘policy’ (base) interest rates to zero (ZIRP) but further into negative interest rates (NIRP).  In other words, central banks were paying commercial banks to take their new money!

But by the end of 2015, the US Fed, with an economy that was doing slightly better than elsewhere, decided to reverse the easy money policy.  The Fed hiked its policy rate in December 2015 for the first time in nine years.  Yellen explained that the US economy “is on a path of sustainable improvement.” and “we are confident in the US economy”.

This year’s discussion at Jackson Hole will not be about ‘unconventional monetary policy’ and the efficacy of QE. That has been forgotten and the debate has moved onto how to ‘normalise’ interest rates (raising them) in order to establish control over potentially rising inflation in an environment of ‘full employment’, without provoking a new recession.  The title of this year’s symposium is Fostering a Dynamic Economy – apparently the world economy is now ‘dynamic’.

Indeed, all the talk is about how for the first time in ten years since the global financial crash, a broad-based economic upswing is at last under way. In America, Europe, Asia and the emerging markets, for the first time since a brief rebound in 2010, all the burners are firing at once.” All 45 countries tracked by the OECD are on track to grow this year and 33 of them are poised to accelerate from a year ago.

Neverthless, mainstream economics remains divided about whether it is a good idea for the Fed to continue to hike rates and sell off its QE purchased bonds, as it eventually plans.  Keynesians like Larry Summers and Paul Krugman reckon such credit tightening would seriously damage consumer spending and investment and cause another credit crunch.  They would prefer to keep the credit bubble going with cheap money, along with some more government spending on infrastructure etc, to avoid ‘secular stagnation’.  Summers wrote that “a reasonable assessment of current conditions suggest that raising rates in the near future would be a serious error”.

On the other hand, the Austrian school of economics as represented by the Bank for International Settlements (BIS), reckons that to keep fuelling the credit bubble with cheap money and QE is presaging yet another financial crash down the road as debt in all the major economies is still too high.  Credit bubbles lead to ‘malinvestment’ and low productivity.  It is better to keep government spending curbed and to hike rates so that money is not spent on useless projects and the credit and stock market bubble is ‘pricked’.

Yellen cites full employment and potentially rising inflation as reasons for hiking interest rates now.   But there is little sign of any pick-up in inflation.  The so-called Phillips curve, namely the trade-off between low unemployment and higher inflation, beloved by Yellen and the Keynesians alike, is not in operation.  It is flatter than eve (see graph below).  Phillips was proved wrong in the 1970s when economies experienced, low growth, high unemployment and inflation (‘stagflation’).  Now there is high employment (at least on official figure) but low inflation, low growth and low wages – stagnation.

The reality is that cutting or hiking interest rates has little effect on capitalist economies compared to the level of profitability in the capitalist sectors of the world economy. If profitability is improving, then interest rates could rise with little impact on the ‘real economy’, even if the stock market falls back.  It is the profitability of capital that matters and from there to investment and growth.

In a recent post, I pointed out that both US and global corporate profits has staged something of small recovery in the last few quarters.  But US domestic corporate profits have grown at an annualized rate of just 0.97% over the last five years. Prior to this period, five-year annualized profit growth was 7.95%.   And profitability (profit as a percentage of capital invested) in the US is some 6% below its peak in 2006 before the Great Recession and after recovering to that peak by 2014, has been falling for the last two years (according to my calculations from AMECO data).

Moreover, at $8.6 trillion, US corporate debt levels are 30% higher today than at their prior peak in September 2008.  At 45.3%, the ratio of corporate debt to GDP is at historic highs, having recently surpassed levels preceding the last two recessions.  That suggests that increased costs of debt servicing from rising interest rates driven by the Fed’s ‘normalisation’ policy could tip things over, unless profitability recover for the wider corporate sector.

Jackson Hole was so named because it was set in a deep valley between the peaks of the massive Teton mountains. Will the central bankers there be right that the world economy is finally getting out of its hole and heading to the heights of the Tetons? We shall see.

 

Picking up?

August 17, 2017

The latest economic data are showing that economic growth in the major capitalist countries has been picking up in the first half of 2017.

Japan’s economy expanded at the fastest pace for more than two years in the three months to June, with domestic spending accelerating as the country prepares for the 2020 Tokyo Olympics.

In the Eurozone, real GDP growth rose at annualised rate of 2.5%, with the Visegrad countries of Czech, Poland, Hungary and Slovakia rising at 5.8% in the second quarter of this year.

With the US economy continuing to trundle along at just over a 2% a year growth, the major economies are looking a little brighter in growth terms, it seems – at least compared to the falling growth rates of 2015-6.

What has been the key reason for this slight improvement?  In my view, it is the relative recovery in the Chinese economy, considered by most observers and the evidence as the driver of world economic growth (at the margin) since 2007. As the IMF put it in its latest survey of the Chinese economy, “With many of the advanced economies of the west struggling in the years since the financial crisis of 2007-09, China has acted as the growth engine of the global economy, accounting for more than half the increase in world GDP in recent years.”

Manufacturing output in China increased 6.7% yoy in July, continuing a slight recovery in 2017 after reaching a low in 2016 from a peak of over 11% a year in 2013.  As a result, Eurozone manufacturing output has picked up, particularly in Germany, the Netherlands and Italy as they export more to China.  The US manufacturing sector has also reversed its actual decline in 2016.  Japan’s manufacturing sector leaped up 6.7% compared to 2016, led by construction demand for the Olympics.

This all looks much better.  But remember most of these major economies are still growing at only around 2% a year, still well below pre-2007 rates or even the average in the post-1945 period.  The ‘developed’ capitalist economies are growing at their slowest rate in decades.  Ruchir Sharma, chief global strategist and head of emerging markets at Morgan Stanley Investment Management, noted in a recent essay in the magazine Foreign Affairs that “no region of the world is currently growing as fast as it was before 2008, and none should expect to. In 2007, at the peak of the pre-crisis boom, the economies of 65 countries – including a number of large ones, such as Argentina, China, India, Nigeria, Russia and Vietnam – grew at annual rates of 7% or more. Today, just six economies are growing at that rate, and most of those are in small countries such as Côte d’Ivoire and Laos.”

Nevertheless, all the purchasing managers indexes (PMIs) that provide the best ‘high frequency’ guide to the attitude and confidence of the capitalist sector in each country all show expansion is still taking place – if not at the pace of 2013-14.  Again the key seems to be a recovery in China’s PMI.

 

What does all this tell us about the likelihood of a new global economic recession in the next year or two?  That is something that I have been forecasting or expecting.  The latest data would seem to point away from that.

The mainstream forecasters remain optimistic about growth with the only proviso being that it is China that might collapse.  The IMF survey makes the familiar argument of the mainstream that overall debt is so high that it will eventualy collapse in bankruptcies and defaults, causing a slump and weakening the world economy.  Total debt has quadrupled since the financial crisis to stand at $28tn (£22tn) at the end of last year.

I disagree: for two reasons.  First, when China’s growth slowed sharply at the beginning of 2016, the mainstream observers argued that China could bring the world economy down.  My view was that, important as the Chinese economy was, it was not large enough to take the US and Europe down.  Those advanced economies remained the key to whether there would be a world slump.  And so it has proved.

Second, the size of China’s debt is large but the Chinese economy is different from the advanced capitalist economies.  Most of that debt is owed by the Chinese state banks and state enterprises.  The Chinese government can bail these entities out using its reserves and forced savings of Chinese households.  The state has the economic power to ensure that, unlike governments in the US and Europe during the credit crunch of 2007.  Governments then were beholden to the capitalist banks and companies, not vice versa.  So any credit crisis in China will be dealt with without producing a major collapse in the economy, in my view.

So does this mean that a new world slump is off the agenda?  No, in short.  One of my key indicators of the health of capitalist economies, as the readers of this blog well know, is the movement of profits in the capitalist sector.  Global corporate profits (a weighted average of the major economies) have also made a significant recovery from their collapse at the end of 2015. Indeed corporate profits overall seem to rising at the fastest rate since the immediate bounce-back after the end of the Great Recession.

But this overall figure is driven by the Chinese recovery and the pickup in Japan (due to the Olympics construction?).  Corporate profit growth in the US, Germany and the UK is slowing again after a brief pick-up in late 2016.

For me, the key remains the state of US economy and in particular, profits and investment levels there.  The booming US stock market is now way out of line with corporate earnings levels.  The S&P 500 cyclically adjusted price-to-earnings (CAPE) valuation has only been higher on one occasion, in the late 1990s. It is currently on par with levels preceding the Great Depression.

US corporate profits have recovered in the last few quarters after declining (although now slowing again) and, along with that, business investment has picked up.  Watch this space over the rest of 2017 to see if this is sustained.

Total domestic corporate profits have grown at an annualized rate of just 0.97% over the last five years. Prior to this period five-year annualized profit growth was 7.95%. At $8.6 trillion, corporate debt levels are 30% higher today than at their prior peak in September 2008.  At 45.3%, the ratio of corporate debt to GDP is at historic highs, having recently surpassed levels preceding the last two recessions.  If there is an issue with the level of debt, it is in the US, not in China.

Ten years on

August 8, 2017

It’s ten years on to the day since the global financial crash began with the news that the French bank, BNP had suspended its sub-prime mortgage funds because of “an evaporation of liquidity”.

Within six months, credit tightened and inter-bank interest rates rocketed (see graph above).  Banks across the globe began to experience huge losses on the derivative funds that they had set up to profit from the housing boom that had taken off in the US, but had started to falter.  And the US and the world entered what was later called The Great Recession, the worst slump in world production and trade since the 1930s.

Ten years later, it is worth reminding ourselves of some of the lessons and implications of that economic earthquake.

First, the official institutions and mainstream economists never saw it coming.  In 2002, the head of the Federal Reserve Bank, Alan Greenspan, then dubbed as the great maestro for apparently engineering a substantial economic boom, announced that ‘financial innovations’ i.e. derivatives of mortgage funds etc, had ‘diversified risk’ so that “shocks to overall economic will be better absorbed and less likely to create cascading failures that could threaten financial stability”.  Ben Bernanke, who eventually presided at the Fed over the global financial crash, remarked in 2004 that “the past two decades had seen a marked reduction in economic volatility” that he dubbed as the Great Moderation. And as late as October 2007, the IMF concluded that “in advanced economies, economic recessions had virtually disappeared in the post-war period”.

Once the depth of the crisis was revealed in 2008, Greenspan told the US Congress, “I am in a state of shocked disbelief”.  He was questioned “in other words, you found that your view of the world , your ideology, was not right, it was not working” (House Oversight Committee Chair, Henry Waxman). “Absolutely, precisely, you know that’s precisely the reason I was shocked, because I have been going for 40 years or more with very considerable evidence that it was working exceptionally well”.

The great mainstream economists were no better.  When asked what caused the Great Recession if it was not a credit bubble that burst, Nobel Prize winner and top Chicago neoclassical economist Eugene Fama responded: “We don’t know what causes recessions. I’m not a macroeconomist, so I don’t feel bad about that. We’ve never known. Debates go on to this day about what caused the Great Depression. Economics is not very good at explaining swings in economic activity… If I could have predicted the crisis, I would have. I don’t see it.  I’d love to know more what causes business cycles.”

Soon to be IMF chief economist, Olivier Blanchard, commented in hindsight that “The financial crisis raises a potentially existential crisis for macroeconomics.” … some fundamental [neoclassical] assumptions are being challenged, for example the clean separation between cycles and trends” or “econometric tools, based on a vision of the world as being stationary around a trend, are being challenged.”

But then most of the so-called heterodox economists, including Marxists, did not see the crash and the ensuing Great Recession coming either.  There were a few exceptions:  Steve Keen, the Australian economist forecast a credit crash based on his theory that “the essential element giving rise to Depression is the accumulation of private debt” and that had never been higher in 2007 in the major economies.  In 2003, Anwar Shaikh reckoned the downturn in the profitability of capital and the downwave in investment was leading to a new depression. And yours truly in 2005  said: “There has not been such a coincidence of cycles since 1991. And this time (unlike 1991), it will be accompanied by the downwave in profitability within the downwave in Kondratiev prices cycle. It is all at the bottom of the hill in 2009-2010! That suggests we can expect a very severe economic slump of a degree not seen since 1980-2 or more”  (The Great Recession).

As for the causes of the global financial crash and the ensuing Great Recession, they have been analysed ad nauseam since.  Mainstream economics did not see the crash coming and were totally perplexed to explain it afterwards. The crash was clearly financial in form: with collapse of banks and other financial institutions and the weapons of mass financial destruction, to use the now famous phrase of Warren Buffett, the world’s most successful stock market investor.  But many fell back on the theory of chance, an event that was one in a billion; ‘a black swan’ as Nassim Taleb claimed.

Alternatively, capitalism was inherently unstable and occasional slumps were unavoidable.  Greenspan took this view: “I know of no form of economic organisation based on the division of labour (he refers to the Smithian view of a capitalist economy), from unfettered laisser-faire to oppressive central planning that has succeeded in achieving both maximum sustainable economic growth and permanent stability.  Central planning certainly failed and I strongly doubt that stability is achievable in capitalist economies, given the always turbulent competitive markets continuously being drawn toward but never quite achieving equilibrium”.  He went on, “unless there is a societal choice to abandon dynamic markets and leverage for some form of central planning, I fear that preventing bubbles will in the end turn out to be infeasible.  Assuaging the aftermath is all we can hope for.”

Most official economic leaders like Blanchard and Bernanke saw only the surface phenomena of the financial crash and concluded that the Great Recession was the result of financial recklessness by unregulated banks or a ‘financial panic’.  This coincided with some heterodox views based on the theories of Hyman Minsky, radical Keynesian economist of the 1980s, that the finance sector was inherently unstable because “the financial system necessary for capitalist vitality and vigour, which translates entrepreneurial animal spirits into effective demand investment, contains the potential for runaway expansion, powered by an investment boom.  Steve Keen, a follower of Minsky put it thus: “capitalism is inherently flawed, being prone to booms, crises and depressions.  This instability, in my view, is due to characteristics that the financial system must possess if it is to be consistent with full-blown capitalism.”   Most Marxists accepted something similar to the Minskyite view, seeing the Great Recession as a result of ‘financialisation’ creating a new form of fragility in capitalism.

Of the mainstream Keynesians, Paul Krugman railed against the neoclassical school’s failings but offered no explanation himself except that it was a ‘technical malfunction’ that needed and could be corrected by restoring ‘effective demand’.  

Very few Marxist economists looked to the original view of Marx on the causes of commercial and financial crashes and ensuing slumps in production.  One such was G Carchedi, who summed that view up in his excellent, but often ignored Behind the Crisis with: ““The basic point is that financial crises are caused by the shrinking productive base of the economy. A point is thus reached at which there has to be a sudden and massive deflation in the financial and speculative sectors. Even though it looks as though the crisis has been generated in these sectors, the ultimate cause resides in the productive sphere and the attendant falling rate of profit in this sphere.”  Agreeing with that explanation, the best book on the crash remains that by Paul Mattick Jnr, Business as usual. 

And indeed, profitability in the productive sectors of the capitalist major economies was low historically in 2007, as several studies have shown.  In the US, profitability peaked in 1997 and the rise in profitability in the credit boom of 2002-6 was overwhelmingly in the financial and property sectors.  This encouraged a huge rise in fictitious capital (stocks and debt) that could not be justifies by sufficient improvement in profits from productive investment.

The mass of profit began to fall in the US in 2006, more than a year before the credit crunch struck in August 2007.  Falling profits meant over-accumulation of capital and thus a sharp cutback in investment.  A slump in production, employment and incomes followed i.e. The Great Recession.

Since the end of that recession in mid-2009, most capitalist economies have experienced a very weak recovery, much weaker than after previous post-war recessions and in some ways even weaker than in the 1930s.  A recent Roosevelt Institute report by JW Mason found that “there is no precedent for the weakness of investment in the current cycle. Nearly ten years later, real investment spending remains less than 10 percent above its 2007 peak. This is slow even relative to the anemic pace of GDP growth, and extremely low by historical standards.”

So the Great Recession became the Long Depression, as I described it, a term also adopted by many others, including Keynesian economists like Paul Krugman and Simon Wren-Lewis.  Why did the Great Recession not lead to a ‘normal’ economic recovery to previous investment and production rates?  The mainstream economists of the monetarist school argue that governments and central banks were slow in cutting interest rates and adopting ‘unconventional’ monetary tools like quantitative easing.  But when they did, such policies appeared to have failed in reviving the economy and merely fuelled a new stock market and debt boom.

The neoclassical school reckons that debt should be cut back as it weighs on the ability of companies to invest while governments ‘crowd out’ credit because of their high levels of borrowing.  This ignored the reason for high government debt, namely the huge cost of bailing out banks globally and the slump in tax revenues from the recession.  In opposition, the Keynesians say the Long Depression was all due to ‘austerity’ ie governments trying to reduce government spending and balance budgets.  But the evidence for that conclusion is not compelling.

What the neoclassical, Keynesian and heterodox views have in common is a denial for any role for profit and profitability in booms and slumps in capitalism!  As a result, none look for an explanation for low investment in low profitability.  And yet the correlation between profit and investment is high and continually confirmed and profitability in most capitalist economies is still lower than in 2007.  

After ten years and a decidedly long, if very weak, economic recovery phase in the ‘business cycle’, are we due for another slump soon?  History would suggest so.  It won’t be triggered by another property slump, in my view.  Real estate prices in most countries have still not recovered to 2007 levels and even though interest rates are low, housing transaction levels are modest.

The new trigger is likely to be in the corporate sector itself.  Corporate debt has continued to rise globally, especially in the so-called emerging economies.  Despite low interest rates, a significant section of weaker companies are barely able to service their debts.  S&P Capital IQ noted that a record stash of $1.84trn in cash held by US non-financial companies masked a $6.6trn debt burden. The concentration of cash of the top 25 holders, representing 1% of companies, now accounts for over half the overall cash pile. That is up from 38% five years ago.  The big talk about the hegemoths like Apple, Microsoft, Amazon having mega cash reserves hides the real picture for most companies. 

Profit margins overall are slipping and in the US non-financial corporate profits have been falling.

And now central banks, starting with the US Federal Reserve, have started to reverse ‘quantitative easing’ and hike policy interest rates.  The cost of borrowing and existing debt servicing will rise, just at a time when profitability is flagging.

That’s a recipe for a new slump – ten years after the last one in 2008?

Reblogged from thenextrecession.wordpress.com/

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Why is not the question of sponsored terrorism asked? – part 2

The Islamic State as “Place-Setter” for the American Empire. ISIS is the Product of the US Military-Intelligence Complex

 

“ISIS” is a product of the US Military-Intelligence complex. The word itself connotes “ISlam”, and so from the very beginning the construct serves to create Islamophobia, which is a necessary pre-condition for the US Empire’s holocaust-creating footprint overseas[1]. War requires hatred and ISIS fits the bill. The fact that ISIS’ deeds are entirely anti-Islamic is of no importance.

Rita Katz[2] et al. beheading videos and domestic false flag terrorism all serve the necessary function of engineering consent for a War On Terror which features as its main star the West’s very own terror proxies – ISIS. ISIS itself is a false flag in the sense that whereas ISIS is the designated enemy, the psychological operation conceals the fact that ISIS is also us – they are the Empire’s foot soldiers.

In terms of military strategy, ISIS is used as a “place-setter”. Empire directs ISIS to areas that it wants to destroy – under the false pretext of going after its own assets (ISIS et al.) so that it can destroy the target area even as it relocates the “target”.

Consider, for the example, Mosul, Iraq. Prof Chossudovsky explains in “The Engineered Destruction and Political Fragmentation of Iraq”[3] that the US co-opted the Iraqi military to “allow” ISIS into Mosul in the first place — so that the city could then be destroyed, and civilians massacred, in the name of going after ISIS.  Subsequently, ISIS was relocated from Mosul to Syria.

 

ISIS is also being used as a “place-setter” in Syria. Similar military strategies have been deployed in the occupation and destruction of Raqqa, Syria.

ISIS convoy leaves Raqqa, Syria

Similarly, the U.S coalition is using ISIS as a “place-setter” for a proposed “Kurdistan” region.[4]

Even as Syria and its allies defeat NATO terrorism, ISIS will continue to make its presence felt in areas of the world that dare to resist the U.S Empire’s dictatorship.

Notes

[1] Gideon Polya, “Iraqi Holocaust, Iraqi Genocide and US Alliance holocaust denial.” December 13, 2009,       (https://sites.google.com/site/iraqiholocaustiraqigenocide/polya-gideon) Accessed August 29, 2017

[2] Mark Taliano, “Mainstream Media is corrupt to the core.” American Herald Tribune, November 04, 2015. (https://ahtribune.com/politics/73-mainstream-media-corrupt.html” Accessed August 29, 2017.

[3] Michel Chossudovsky, “The Engineered Destruction and Political Fragmentation of Iraq.” Global Research, July 14, 2017. (http://www.globalresearch.ca/the-destruction-and-political-fragmentation-of-iraq-towards-the-creation-of-a-us-sponsored-islamist-caliphate/5386998) Accessed August 29, 2017.

[4] Mark Taliano, “ ‘Creative Chaos’ and the War Against Humanity. US-NATO Supports ISIS.” Global Research. May 29, 2017. (http://www.globalresearch.ca/creative-chaos-and-the-war-against-humanity-us-nato-supports-isis/5592499) Accessed August 29, 2017.

All images, except the featured image, are from the author.

 

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Why is not the question of sponsored terrorism asked? – part 1

ISIS – Always-Always Claims Responsibility

Global Research, August 23, 2017

 

Whenever a terrorist attack hits somewhere in Europe or the world, wait a few hours and the police or media report ISIS / ISIL / Daesh claims responsibility. To enhance credibility, they usually say it was confirmed by ISIS news agency Amaq. As soon as this little piece of info is out, the upset populace takes a deep breath and falls at ease. It’s the usual culprits. It’s them, not us. We are fine. We can go back to business as usual.

This in Europe alone has happened more than 40 times since May 2014 – that’s as many ‘Muslim-induced terror attacks’ Western Europe has endured; from Paris to Nice, Brussels, London, Berlin, Munich, Würzburg, Copenhagen, Zvornik (Bosnia & Herzegovina), Moscow, Istanbul, and many more. And almost without fail, the alleged perpetrator(s) were killed, though most of them were not armed and could have been apprehended by police, questioned and brought to justice. Dead men don’t talk. That’s more convenient.

The latest Barcelona terror Amuck-run on the Rambla is not different. It is a case in point and a typical case for confusion. There were several chief-perpetrators suspected and killed. Many names circulated – and, of course, a passport, leading to a Spanish enclave in Morocco was found. The owner of the passport, immediately reported it to the police as stolen, with a solid alibi. But then, suitably his 17-year-old brother stole the passport and left it in the white van, when he fled on foot, injured from an explosion the night before, in a residency some 230 km south of Barcelona – or was that really him? – and several hours after the Rambla assault, he was caught by police in Cambrils, 120 km south of Barcelona in another attempted pedestrian run – and killed among one of five terrorists who happened to be squeezed into the same Audi. Ever wondered, why so many terrorists in one car? – Or was he really one of those killed?

By now, the people are really-really confused. Nobody knows up from down in this chaos. Better leave it to the authorities. They know best to handle the situation. Let us go back to normal – until the next terror attack hits – Allahu Akbar – very likely next in a theatre near you, somewhere in this old, purposefully and increasingly militarized police state, called Europe.

What happened to the real and innocent owner of the passport? – Does anybody know? Or can we ask ten ‘official’ sources and get ten different answers?

How come special police throughout Europe apply the same philosophy – kill to shut them up? Isn’t there a police ethics code – shoot only in self-defense? Most cases were no self-defense, as the ‘terrorists’ were visibly not armed. Have European secret and special police forces been receiving collective, well-focused training: no Muslim-Terrorist Survivors!

Why not? – That would also explain why never anybody questions the ISIS claim to murder and mayhem. Why would ISIS / ISIL / Daesh want to hurt those who fund them, train them, arm them, feed them? – It’s not even secret any more. Hillary said so already years ago, We created them, now we have to deal with them. Former CIA officials admitted that they recruited, funded, trained and armed them – later the ISIL / Daesh reign was expanded with additional financial backing by the Saudis, other Gulf States and Turkey – and, of course, all the holy western allies. – So, why would ISIS want to hurt the cow whose milk they drink? Strange – isn’t it?

Maybe what meets the eye is not reality. Could it be that ISIS / ISIL / Daesh, out of sheer gratitude to its benevolent sponsors have agreed to take the blame whenever a western orchestrated terror attack strikes somewhere in Europe or the world? Can’t be excluded, can it? It’s not even blackmail. After all, lending a helping hand to the Big Brothers, NATO, France, Germany, UK, US of A and many more lesser contributors, but contributors all the same – who keep you alive, would not be out of the world. – Right? – This is all done in connivance with massive support of European secret services, led by the usual villains, CIA, MI6, Mossad. 

Is it therefore far-fetched to conclude that European governments are utterly complicit in instigating and executing these ‘false flag’ terror attacks, sacrificing the lives of hundreds of their citizens, just so they can pursue their goal of totally militarizing the Continent?  – That they are as faithful vassals following the pattern of their trans-Atlantic partners – aiming at Full Spectrum Dominance – World Hegemony, a New World Order under a One World Order governed by Washington and its Deep Dark handlers? – Barcelona, Paris, Berlin are mere little pebbles in the Big Picture mosaic of world dominion. And the people, the mothers, fathers, wives, husbands, children who are killed – they are just menial collateral damage. After all, slaves – what is their value?

Peter Koenig is an economist and geopolitical analyst. He is also a former World Bank staff and worked extensively around the world in the fields of environment and water resources. He lectures at universities in the US, Europe and South America. He writes regularly for Global Research, ICH, RT, Sputnik, PressTV, The 4th Media (China), TeleSUR, The Vineyard of The Saker Blog, and other internet sites. He is the author of Implosion – An Economic Thriller about War, Environmental Destruction and Corporate Greed – fiction based on facts and on 30 years of World Bank experience around the globe. He is also a co-author of The World Order and Revolution! – Essays from the Resistance.

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Why US Imperialism is the Problem – and not North Korea

North Korea, An Aggressor? A Reality Check

By Felicity Arbuthnot

“ … war in our time is always indiscriminate, a war against innocents, a war against children.”(Howard Zinn, 1922-2010.)

All war represents a failure of diplomacy.” (Tony Benn, MP. 1925-2014.)

“No country too poor, too small, too far away, not to be threat, a threat to the American way of life.” (William Blum, “Rogue State.”)      

The mention of one tiny country appears to strike at the rationality and sanity of those who should know far better. On Sunday, 6th August, for example, The Guardian headed an editorial: “The Guardian view on sanctions: an essential tool.” Clearly the average of five thousands souls a month, the majority children, dying of “embargo related causes” in Iraq, year after grinding year – genocide in the name of the UN – for over a decade has long been forgotten by the broadsheet of the left.

This time of course, the target is North Korea upon whom the United Nations Security Council has voted unanimously to freeze, strangulate and deny essentials, normality, humanity. Diplomacy as ever, not even a consideration. The Guardian, however, incredibly, declared the decimating sanctions: “A rare triumph of diplomacy …” (Guardian 6th August 2017.)

As US Secretary of State, Rex Tillerson, the US’ top “diplomat” and his North Korean counterpart Ri Yong-ho headed for the annual Ministerial meeting of the Association of Southeast Asian Nations (ASEAN) in Manila on 5th August, a State Department spokesperson said of Tillerson:

“The Secretary has no plans to meet the North Korean Foreign Minister in Manila, and I don’t expect to see that happen”

Pathetic. In April, approaching his hundredth day in office, Trump said of North Korea:

“We’d love to solve things diplomatically but it’s very difficult.”

No it is not. Talk, walk in the other’s psychological shoes. Then, there they were at the same venue but the Trump Administration clearly does not alone live in a land of missed opportunities, but of opportunities deliberately buried in landfill miles deep. This in spite of his having said in the same statement:

“There is a chance that we could end up having a major, major conflict with North Korea. Absolutely.”

A bit of perspective: 27th July 2017 marked sixty four years since the armistice agreement that ended the devastating three year Korean war, however there has never been a peace treaty, thus technically the Korean war has never ended. Given that and American’s penchant for wiping out countries with small populations which pose them no threat (think most recently, Afghanistan, Iraq, Libya) no wonder North Korea wishes to look as if it has some heavy protective gear behind the front door, so to speak.

Tiny North Korea has a population of just 25.37 million and landmass of 120,540 km² (square kilometres.) The US has a population of 323.1 million and a landmass of 9.834 MILLION km² (square kilometres.) Further, since 1945, the US is believed to have produced some 70,000 nuclear weapons – though now down to a “mere” near 7,000 – but North Korea is a threat?  

America has fifteen military bases in South Korea – down from a staggering fifty four – bristling with every kind of weapons of mass destruction. Two bases are right on the North Korean border and another nearly as close. See full details of each, with map at (1.)

North Korea also has the collective memory of the horror wrought by the US in the three year conflict on a country then with a population of just 9.6 million souls. US General Curtis Lemay in the aftermath stated: “After destroying North Korea’s seventy eight cities and thousands of her villages, and killing countless numbers of her civilians … Over a period of three years or so we killed off – what – twenty percent of the population.”

“It is now believed that the population north of the imposed 38th Parallel lost nearly a third its population of 8 – 9 million people during the 37-month long ‘hot’ war, 1950 – 1953, perhaps an unprecedented percentage of mortality suffered by one nation due to the belligerence of another.” (2) 

In context:

“During The Second World War the United Kingdom lost 0.94% of its population, France lost 1.35%, China lost 1.89% and the US lost 0.32%. During the Korean war, North Korea lost close to 30 % of its population.” (Emphasis added.)

“We went over there and fought the war and eventually burned down every town in North Korea anyway, some way or another …”, boasted Lemay.

Image: Pyongyang 1953

 

Gen. Douglas MacArthur said during a Congressional hearing in 1951 that he had never seen such devastation.

“I shrink with horror that I cannot express in words … at this continuous slaughter of men in Korea,” MacArthur said. “I have seen, I guess, as much blood and disaster as any living man, and it just curdled my stomach, the last time I was there.” (CNN, 28th July 2017.)

Horrified as he was, he did not mention the incinerated women, children, infants in the same breath.

Moreover, as Robert M. Neer wrote in “Napalm, an American Biography”:

‘“Practically every U.S. fighter plane that has flown into Korean air carried at least two napalm bombs,” Chemical Officer Townsend wrote in January 1951. About 21,000 gallons of napalm hit Korea every day in 1950. As combat intensified after China’s intervention, that number more than tripled (…) a total of 32,357 tons of napalm fell on Korea, about double that dropped on Japan in 1945. Not only did the allies drop more bombs on Korea than in the Pacific theater during World War II – 635,000 tons, versus 503,000 tons – more of what fell was napalm …’

In the North Korean capitol, Pyongyang, just two buildings were reported as still standing.

In the unending history of US warmongering, North Korea is surely the smallest population they had ever attacked until their assault on tiny Grenada in October 1983, population then just 91,000 (compulsory silly name: “Operation Urgent Fury.)

North Korea has been taunted by the US since it lay in ruins after the armistice sixty five years ago, yet as ever, the US Administration paints the vast, self appointed “leader of the free world” as the victim.

As Fort-Russ pointed out succinctly (7th August 2017):

“The Korean Peninsula is in a state of crisis not only due to constant US threats towards North Korea, but also due to various provocative actions, such as Washington conducting joint military exercises with Seoul amid tensions, and which Pyongyang considered a threat to its national security.”

This month “massive land, sea and air exercises” involving “tens of thousands of troops” from the US and South Korea began on 21st  of August and continue until 31st.

‘In the past, the practices are believed to have included “decapitation strikes” – trial operations for an attempt to kill Kim Jong-un and his top Generals …’, according to the Guardian (11th August 2017.)

The obligatory stupid name chosen for this dangerous, belligerent, money burning, sabre rattling nonsense is Ulchi-Freedom Guardian. It is an annual occurrence since first initiated back in 1976.

US B-1B bombers flying from Guam recently carried out exercises in South Korea and “practiced attack capabilities by releasing inert weapons at the Pilsung Range.” In a further provocative (and illegal) move, US bombers were again reported to overfly North Korea, another of many such bullying, threatening actions, reportedly eleven just since May this year.

Yet in spite of all, North Korea is the “aggressor.”

“The nuclear warheads of United States of America are stored in some twenty one locations, which include thirteen U.S. states and five European countries … some are on board U.S. submarines. There are some “zombie” nuclear warheads as well, and they are kept in reserve, and as many as 3,000 of these are still awaiting their dismantlement. (The US) also extends its “nuclear umbrella” to such other countries as South Korea, Japan, and Australia.” (worldatlas.com)

Russian Foreign Minister Sergey Lavrov who also attended the ASEAN meeting in Manila, did of course, do what proper diplomats do and talked with his North Korean counterpart Ri Yong-ho. Minister Lavrov’s opinion was summed up by a Fort Russ News observer as:

“The Korean Peninsula is in a state of crisis not only due to constant US threats towards North Korea, but also due to various provocative actions, such as Washington conducting joint military exercises with Seoul amid tensions, and which Pyongyang considered a threat to its national security.”

The “provocative actions” also include the threatening over-flights by US ‘planes flying from Guam. However when North Korea said if this continued they would consider firing missiles in to the ocean near Guam – not as was reported by some hystericals as threatening to bomb Guam – Agent Orange who occasionally pops in to the White House between golf rounds and eating chocolate cake whilst muddling up which country he has dropped fifty nine Tomahawk Cruise missiles on, responded that tiny North Korea will again be: “… met with fire and fury and frankly power, the likes of which the world has never seen before.”

It was barely noticed that North Korea qualified the threat of a shot across the bows by stating pretty reasonably:

(The US) “should immediately stop its reckless military provocation against the State of the DPRK so that the latter would not be forced to make an unavoidable military choice.” (3)

As Cheryl Rofer (see 3) continued, instead of endless threats, US diplomacy could have many routes:

“We could have sent a message to North Korea via the recent Canadian visit to free one of their citizens. We could send a message through the Swedish embassy to North Korea, which often represents US interests. We could arrange some diplomatic action on which China might take the lead. There are many possibilities, any of which might show North Korea that we are willing to back off from practices that scare them if they will consider backing off on some of their actions. That would not include their nuclear program explicitly at this time, but it would leave the way open for later.”

There are in fact, twenty four diplomatic missions in all, in North Korea through which the US could request to communicate – or Trump could even behave like a grown up and pick up the telephone.

Siegfried Hecker is the last known American official to inspect North Korea’s nuclear facilities. He says that treating Kim Jong-un as though he is on the verge of attacking the U.S. is both inaccurate and dangerous.

“Some like to depict Kim as being crazy – a madman – and that makes the public believe that the guy is undeterrable. He’s not crazy and he’s not suicidal. And he’s not even unpredictable. The real threat is we’re going to stumble into a nuclear war on the Korean Peninsula.” (5)

Trump made his crass “fire and fury” threat on the eve of the sixty second commemoration of the US nuclear attack on Nagasaki, the nauseating irony seemingly un-noticed by him.

Will some adults pitch up on Capitol Hill before it is too late?

Notes

1. https://militarybases.com/ south-korea/

2. http://www.globalresearch.ca/ know-the-facts-north-korea- lost-close-to-30-of-its- population-as-a-result-of-us- bombings-in-the-1950s/22131

3. https://nucleardiner. wordpress.com/2017/08/11/ north-korea-reaches-out/

4. https://www.commondreams.org/ news/2017/08/08/sane-voices- urge-diplomacy-after-lunatic- trump-threatens-fire-and-fury

Featured image is from Socialist Project.

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5 THINGS ABOUT THE WAR-NATION NORWAY – 5 ting du ikke visste om krigsnasjonen Norge

Norwegian Libya-bombers. Photo: bodonu.no Norway is for many around the world (they who know where this place is) known as a country for peace negotiations in conflicts, Nobel peace price and human rights issues. That’s the cosmetic Norway! Underneath the surface there are darkness. Darkness of war participation and arms trade. Here are five things about Norway as a nation of war:

  1. Did you know that Norway is among the countries who participates most in wars?

Since 1990 Norway has participated in wars eight times. Only Britain and France have participated in more wars. Norway shares this second place with USA.

2. Did you know that the Norwegian parliament voted in favour of using 254 billion NOK (30 billion USD) in buying 52 F-35 war planes from the US?

3. Did you know that Norway is among the worlds biggest exporter of arms?

In 2015 Norway exported weapons for 2,4 billion NOK. Especially  bombs, grenades and ammunition are increasing heavily. Our NATO-allies Turkey bought weapons for 166 billion NOK in 2015.

4. Did you know that Norway spends more money on the military than any other NATO-country in Europe?

Next to the US Norway is the NATO-country which uses most money per capita on the military.

5. Did you know that there are more voters in Norway against NATO than voters for the populist new-liberal right party?

In a poll in 2015 15 percent said they thought NATO-membership does Norway more vulnerable against attack. The populist new-liberal right party got 9,5 percent of the votes in the local election in 2015.

Ivar Jordre

5 ting du ikke visste om krigsnasjonen Norge

Visste du at Norge er blant landene i verden som oftest deltar i krig?

Siden 1990 har Norge deltatt i krig åtte ganger. Kun Storbritannia og Frankrike har deltatt i flere kriger. Andreplassen deler vi med USA. Høydepunktet for norsk krigføring var bombingen av Libya, hvor Norge var et av landene som bombet mest. Norge gikk også i front ved å ta på seg oppdrag andre land ikke ville ha, fordi de var politisk sensitive, med stor fare for sivile tap. Norge var dermed en kraft for å utvide bombingen, snarere enn en kraft for fred.

Visste du at Stortinget har vedtatt å bruke 254 milliarder på kjøp og vedlikehold av nye jagerfly?

Stortinget har vedtatt å kjøpe 52 jagerfly av typen F-35 fra USA. Kjøp og vedlikehold fram til 2054 vil koste over 254 milliarder kroner. Det er 25 ganger mer enn de 10 milliardene Norge skal bidra med til syriske flyktninger de neste fire årene. Med den norske deltakelsen i bombingen i Libya, er det rimelig å tro at disse flyene vil bidra til flere flyktninger i årene framover. Forsvarsminister Ine Marie Eriksen Søreide sier at kjøpet av flyene vil forplikte Norge til deltakelse i internasjonale operasjoner i framtida.

Visste du at Norge er en av verdens største våpeneksportører?

I 2015 eksporterte Norge våpen for 2,4 milliarder kroner. Spesielt bomber, granater og ammunisjon øker kraftig. Vår NATO-allierte Tyrkia kjøpte våpen for 166 millioner kroner i 2015. Regimet i Tyrkia fører en brutal krig mot kurderne, og Norge har ingen kontroll over hvor mange uskyldige som er drept med norske våpen eller ammunisjon. At Tyrkia er på vei til å bli et diktatur har ikke lagt noen demper på norsk eksport.

Visste du at Norge bruker mer penger på militæret per innbygger enn noe annet NATO-land i Europa?

Etter USA er Norge landet i NATO som bruker mest penger per innbygger på militæret. Allikevel gjør kjøpet av kampflyene F-35 at resten av forsvaret bygges ned. Norges evne til å forsvare seg selv blir dårligere. På bekostning av økt evne til å delta i bombing når USA ber oss om det i utlandet.

Visste du at det er flere NATO-motstandere enn FrP-velgere i Norge?

I en undersøkelse utført av TNS Gallup i 2015 svarte 15 prosent av de spurte at de mener medlemsskapet i NATO gjør Norge mer utsatt for angrep. Det er det høyeste tallet siden målingene startet i 2003. Ved lokalvalget i 2015 fikk FrP 9,5 prosent av stemmene.

Rødt vil:

  • At Norge skal si nei neste gang USA ber Norge delta i den såkalte krigen mot terror. Bombing fra stor høyde vil aldri føre til fred, demokrati eller hindre terror.
  • Avblåse hele jagerflykjøpet. Norge trenger ikke bombefly for å forsvare seg.
  • At Norge slutter å eksportere våpen til undertrykkende regimer. Vi krever sluttbrukererklæring, slik at våpen fra Norge ikke kan selges videre til land i krig.
  • Melde Norge ut av NATO, fordi NATO gjør Norge mer utsatt for angrep og verden mer utrygg.

Ivar Jørdre

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RAUDTs Partileiarføredrag august 2017 – Video

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