Sunday, May 9, 2010

Stock Market Collapse: More Goldman Market Rigging

Stock Market Collapse: More Goldman Market Rigging

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Last week, Goldman Sachs was on the congressional hot seat, grilled for fraud in its sale of complicated financial products called “synthetic CDOs.” This week the heat was off, as all eyes turned to the attack of the shorts on Greek sovereign debt and the dire threat of a sovereign Greek default. By Thursday, Goldman’s fraud had slipped from the headlines and Congress had been cowed into throwing in the towel on its campaign to break up the too-big-to-fail banks. On Friday, Goldman was in settlement talks with the SEC.

Goldman and Wall Street reign. Congress appears helpless to discipline the big banks, just as the European Central Bank appears helpless to prevent the collapse of the European Union. . . . Or are they?

Suspicious Market Maneuverings

The shorts circled like sharks in the Greek bond market, following a highly suspicious downgrade of Greek debt by Moody’s on Monday. Ratings by private ratings agencies, long suspected of being in the pocket of Wall Street, often seem to be timed to cause stocks or bonds to jump or tumble, causing extreme reactions in the market. The Greek downgrade was suspicious and unexpected because the European Central Bank and International Monetary Fund had just pledged 120 billion Euros to avoid a debt default in Greece.

Markets were roiled further on Thursday, when the U.S. stock market suddenly lost 999 points, and just as suddenly recovered two-thirds of that loss. It appeared to be such a clear case of tampering that Maria Bartiromo blurted out on CNBC, “That is ridiculous. This really sounds like market manipulation to me.”

Manipulation by whom? Markets can be rigged with computers using high-frequency trading programs (HFT), which now compose 70% of market trading; and Goldman Sachs is the undisputed leader in this new gaming technique. Matt Taibbi maintains that Goldman Sachs has been “engineering every market manipulation since the Great Depression.” When Goldman does not get its way, it is in a position to throw a tantrum and crash the market. It can do this with automated market making technologies like the one invented by Max Keiser, which he claims is now being used to turbocharge market manipulation.

Goldman was an investment firm until September 2008, when it became a “bank holding company” overnight in order to capitalize on the bank bailout, including borrowing virtually interest-free from the Federal Reserve and other banks. In January, when President Obama backed Paul Volcker in his plan to reinstate a form of the Glass-Steagall Act that would separate investment banking from commercial banking, the market collapsed on cue, and the Volcker Rule faded from the headlines.

When Goldman got dragged before Congress and the SEC in April, the Greek crisis arose as a “counterpoint,” diverting attention to that growing conflagration. Greece appears to be the sacrificial play in the EU just as Lehman Brothers was in the U.S., “the hostage the kidnappers shoot to prove they mean business.”

The Nuclear Option

It is still possible, however, for the European Central Bank to snatch Greece from the fire and rout the shorts. It can do this with what has been called the nuclear option -- “monetizing” the debt of Greece and other debt-laden EU countries by effectively “printing money” (quantitative easing) and buying the debt itself at very low interest rates. This is called the “nuclear option” because it would blow up the hedge funds and electronic sharks operated by Goldman and other Wall Street heavies, which specialize in bringing down corporations and whole countries for strategic and exploitative ends.

Will the ECB proceed with this plan? Perhaps, say some experts. It could just be waiting for the German election on Sunday, which the ECB does not want to appear to be influencing.

Fears over Greek crisis continue to drive down global markets

Fears over Greek crisis continue to drive down global markets

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Despite the Greek parliament’s approval of drastic austerity measures, fears that the country’s economic crisis will deepen and spread to other nations continued to drive down international markets Friday.

The panic selling that saw the Dow Jones Industrial Average plummet by nearly 1,000 points, or about nine percent—a steeper drop than even in the wake of the Lehman Brothers collapse in 2008—continued to reverberate around the world, hitting markets in Asia and Europe and leaving share prices on the New York Stock Exchange down again on Friday.

In Asia, Japan’s Nikkei 225 index was among the worst hit, closing down 3.1 percent on top of a 3.3 fall on Thursday.

Japanese Prime Minister Yukio Hatoyama told reporters Friday that “Japan is very concerned about Greece’s problems and the government will deal solidly with any fallout.” The Bank of Japan poured another 2 trillion yen (nearly US$22 billion) into the country’s financial institutions. It marked the biggest emergency injection by the central bank since December 2008. There are growing concerns about Japan’s own mounting national debt.

In Europe, the FTSE 100 in London was down 2.6 percent; Frankfurt’s DAX fell 3.27 percent and the CAC-40 in Paris dropped 4.13 percent.

After another day of hectic trading on Wall Street, the Dow closed down nearly 140 points, or 1.33 percent. This came on top of Thursday’s 3.2 percent drop. The index has now fallen by nearly 7.5 percent compared to last month, and most financial analysts predict that the decline will continue.

The media, led by the talking heads on the cable television financial programs, cast about for explanations for Thursday’s market seizure, pointing to computerized trading and even a so-called “heavy finger” trade in which it was rumored that a trader for a major US bank had mistakenly substituted “b” for “m” and sold billions instead of millions in stock.

This theory was largely discounted before the trading was over Friday. No one could verify that such a trade had been made, and financial analysts pointed out that under conditions of an otherwise healthy market, such an error would have had a negligible effect.

The US Security and Exchange Commission, meanwhile, announced that it is launching a probe of Thursday’s trading to see if the staggering fall in share prices was connected to any “irregularities.”

Serious analysts could not obscure the obvious, however. The sell-off on the international markets was the result of a growing panic among the world’s ruling elites over the events in Greece.

Investors watched live television coverage of tens of thousands of Greek workers battling riot police outside the parliament building in Athens and suffered a severe crisis in confidence, not just in Greek debt, but in the stability of the world capitalist system generally.

There was a palpable fear that similar eruptions are on the horizon throughout Europe, Asia and in the United States itself as governments pursue similar measures to those being imposed in Greece as a means of forcing working people to pay for the massive debts of the banks and for the ballooning public deficits that have been incurred to prop up the financial sector.

As the Washington Post reported, the continued plummeting of share prices on the world stock markets was being driven by “evidence of a scary proposition: That the fiscal crisis that began in Greece months ago is spreading across Europe like a virus, causing growing doubt even about the fate of nations with far more manageable levels of government debt.”

This includes Spain, which has come under increasing financial pressure, despite having considerably less debt, compared to the size of its economy, than Britain or the United States.

The result of this “contagion effect,” the Post continued, is that investors are selling off their investments in other countries’ debts, creating a kind of self-fulfilling prophecy. These countries, in turn, must pay “higher and higher interest rates to get any loans,” unleashing a “fiscal death spiral.”

New York Times economic analyst Floyd Norris wrote Friday that “fears are growing that Europe, which is worried that the crisis in Greece could be followed [by] ones in Portugal and Spain, will follow the pattern laid down by the United States government in 2007, when officials offered frequent reassurances that the sub-prime mortgage problem was ‘contained’ but delayed taking the bold action that finally did stop the panic.”

Mohamed A. El-Erian, the chief executive of the money management firm, Pimco, told the Times: “There is a recognition that the Greek crisis has morphed not into not only a European crisis, but is going global.”

This sense that the Greek events pose a grave threat to the world capitalist economy found expression in an emergency teleconference held Friday by the finance ministers and central bankers of the Group of 7—United States, Germany, Japan, Britain, France, Italy and Canada.

Canada’s Finance Minister Jim Flaherty told reporters after the conference that all those participating grasped the “urgency” of the crisis and understood “the need for a clear, timely and strong response.” He gave no indication, however, as to what that response would be.

In Germany on Friday, the parliament voted to approve the country’s share of the 110 billion euro ($140 billion) Greek rescue package put together by the European Union and International Monetary Fund.

German Finance Minister Wolfgang Schäuble warned, “It would be devastating to even risk a chance of Greece, a member of the euro zone, going bankrupt.” The result, he suggested, would be the end of Europe’s common currency, the euro and the entire project of capitalist unification of the continent.

In Brussels, meanwhile, the heads of state of the 16 Eurozone nations met Friday evening to discuss final details on the EU section of the financial package. The prerequisite for the meeting was the vote by the Greek parliament the night before to pass a sweeping and draconian package of austerity measures that resembled the kind of International Monetary Fund “shock therapy” programs imposed in much of Latin America during the debt crisis of the 1980s and 1990s.

The bitter opposition of Greek working people to being forced to pay for the crisis created by the financial elite erupted into pitched battles between demonstrators and riot police outside the parliament building in Athens.

Controversy over the package approved by the Greek legislators continued to build on Friday with the announcement by Finance Minister Giorgos Papakonstantinou that the legislation would allow the government of Prime Minister George Papandreou to sign agreements with the EU and the IMF without first submitting them to parliament.

Papakonstantinou said that the EU had demanded the provision, and that the government immediately accepted it to expedite the loan disbursements.

Political instability follows inconclusive British elections

Political instability follows inconclusive British elections

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Britain is entering a period of profound instability in the aftermath of the May 6 general election that goes far beyond the problem of forming a minority or coalition government.

The ballot saw Labour lose votes heavily, with its share declining to 29.1 percent—a post-war low. Its seat loss would have been higher had not sections of workers in the major urban centres held their noses to cast a vote against the Conservatives and the Liberal Democrats. The latter had already indicated their preference for a coalition with the Tories (Conservatives).

Hostility to Prime Minister Gordon Brown, especially under conditions of the worst economic crisis since the 1930s, was not enough to ensure the Conservatives a working majority, however.

With 36.1 percent of the vote, the Conservatives made the most gains, but the 5 percent swing did not give them the 326 seats required for a majority. The increased Tory vote is largely the result of the party’s ability to mobilise its traditional supporters, including those who deserted the party to New Labour in 1997.

The Liberal Democrats also failed to capitalise on alienation from Labour and the Tories. After a media campaign to proclaim that the Liberal Democrats could win the largest share of the popular vote, they instead came in third with just 23 percent and even lost seats.

National turnout was up from 61.4 percent in 2005 to 64.6 percent. Even so, this is a significant decline on the 71.4 percent turnout in 1997 when New Labour first came to power.

The result has been described as the outcome of a “none of the above” sentiment. Not only is the UK bereft of any party that can claim significant popular support, the country is more divided than ever before—along geographic lines that are ultimately rooted in social divisions.

This found distorted and only partial expression in the regionally skewed vote received by Labour and the Conservatives.

In Scotland, Labour won 41 out of 59 seats with over 42 percent of the vote. The Conservatives just managed to retain their single seat north of the border, while the Liberal Democrat vote fell to 18.6 percent. The Scottish National Party saw a slight increase in its vote share, but lost Glasgow East to Labour.

In Wales, Labour’s 32.6 percent vote was marginally higher than the national average but was still the party’s lowest share since 1918. This was enough to give it a majority of 26 out of 40 Welsh seats.

In Northern Ireland, the Ulster Unionist Party was wiped out—leaving the Conservatives in the very difficult position of having to seek an agreement with the now dominant Democratic Unionist Party. Conservative leader David Cameron had earlier boasted that he would form a government with just the support of the UUP.

A key factor in these results is the overwhelming dependence of the economies in Scotland, Wales, Northern Ireland, and large parts of the north of England, on the public sector. To some effect, Labour claimed that Cameron’s pledge to immediately take the axe to public spending would “endanger the recovery” and lead to mass layoffs and wage cuts. This also enabled Labour to hold off a potential challenge to its position in inner-city London.

Results for local authority elections in England indicate a similar pattern, with Labour making gains and the Tories and Liberal Democrats losing seats. The Liberal Democrats even lost control of Sheffield City Council, where party leader Nick Clegg’s Hallam constituency is located.

The unexpected increase in turnout saw thousands of people prevented from voting in Newcastle, Leeds, Liverpool, Manchester, Sheffield and parts of the capital due to the lack of staff and/or ballot papers. There were angry scenes outside polling stations and even sit-ins as police were called to tell people that had queued for hours they would not be able to cast their ballot. Legal challenges are expected.

In reality, all the official parties have concealed plans for major cuts that have been drawn up behind the scenes by civil servants. The Independent reported Friday that “Senior Whitehall civil servants have been working on secret options for cuts going far beyond those disclosed by the three main party leaders before the voters went to the polls—despite a backlash from public sector workers.”

Discussions on the formation of a new government are entirely determined by the interests of the banks and major corporations. In an unprecedented move, the bond markets were opened at 1 a.m. to allow global financial concerns to register their “verdict” on the election result. Bond prices initially rose on expectations of a Tory victory, but then fell sharply.

In defiance of constitutional norms that allow for the sitting prime minister to attempt to form a government in case of a hung parliament, Cameron declared he would head a minority administration.

Speaking in the early hours of the morning, Clegg had cautioned that time should be taken to decide on the best course of action. But when the pound opened sharply down to a one-year low against the dollar just a few hours later, he made a public declaration in favour of Cameron’s “first right” to try and form a government.

Later that day, Cameron gave a speech offering to “work together” with the Liberal Democrats, hinting at a possible coalition. For his part, Brown appeared to concede this was the likely outcome, stating that he respected “completely” Clegg’s position while holding out potential negotiations should this fail.

Notwithstanding their disagreements, all three party leaders share the same overriding concern.

There is a desire to avoid having to call a second general election, as was last made necessary in 1974 when Harold Wilson’s minority Labour government, elected in February, was forced to seek a fresh mandate just eight months later.

Another, perhaps more relevant analogy has been drawn to the hung parliament of May 30, 1929, when Labour’s Ramsay MacDonald failed to gain a majority. Against the backdrop of the Wall Street crash and the start of the Great Depression it paved the way for the formation of a government of national unity in 1931.

But more is at stake than mere parliamentary arithmetic. As Brown indicated, “What all of us should be mindful of is the imperative of strong stable government and for that to be formed with the authority to tackle the challenges ahead and one that can command support in parliament. It is with this in mind that all of us should be facing the times ahead.”

The “strength” and “stability” he invokes is required in order to face off the opposition that must inevitably emerge to the savage austerity measures being demanded in ruling circles.

Such manoeuvres will resolve nothing. The present political instability is rooted in a pronounced class polarisation that is destabilising the whole of Europe and which can only sharpen over the next period.

As Britain went to the polls, the Greek parliament met behind ranks of riot police to agree a draconian austerity package that had brought tens of thousands of protesters onto the streets.

Fears of a “Greek contagion”—even threatening the survival of the Eurozone—were a major factor in the turmoil on Wall Street Thursday that saw the Dow Jones suffer its largest ever drop.

The May 6 edition of the Daily Mail carried the headline: “Burning issue for Britain: With our deficit about to become worse than Greece’s, anarchy and murder erupt on the streets of Athens”. And Moody’s Investors Service warned that the banking systems of Portugal, Italy, Spain, Ireland and the UK were at risk, with British banks particularly exposed.

The Socialist Equality Party received a small vote for the two candidates it stood—Robert Skelton for Manchester Central (54 votes) and David O’Sullivan in Oxford East (116 votes). But this is not the only, or even the best measure of the political importance of the campaign the party waged.

The SEP advanced a socialist and internationalist programme based upon an analysis of the political situation, which has proved to be entirely correct.

We were the only party that did not join in the stampede behind Labour that characterised all of the petty bourgeois ex-left tendencies, such as the Trade Unionist and Socialist Coalition. Rather, we insisted that the crucial task was the “preparation of an independent political movement of the working class against austerity, militarism and war” through the building of a new socialist party for working people.

This stand on political principles will prove decisive, under conditions in which a major political realignment to the left within the working class in Britain and internationally must follow.

In a Harvard E-Mail, White Privilege on Full Display

In a Harvard E-Mail, White Privilege on Full Display

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I've heard the words, or ones like it, for a long time. Sometimes they are couched in qualifiers, sometimes accompanied with "I'm only kidding" nervous laughter. Sometimes no words are necessary, as intent is conveyed in a sideways glance or eye roll.

Stephanie Grace just came right out and said them, then wrote them in an e-mail. The Princeton graduate and Harvard law school student, educated within an inch of her life, revealed she had not learned very much when she wrote: "I absolutely do not rule out the possibility that African-Americans are, on average, genetically predisposed to be less intelligent."

Whatever she's been studying, it's obviously not genetics, since the race and intelligence link has long been debunked. (I'll see your "Bell Curve" and raise you "Race and IQ," with essays by folks who actually know what they're talking about.) And it's not history, or she would realize that her noxious musings have been used to justify genocide, slavery, segregation, eugenics, forced sterilization and discrimination in everything from housing to schools to employment.

Grace may say, "I could also obviously be convinced that by controlling for the right variables, we would see that they are, in fact, as intelligent as white people under the same circumstances." But her heart doesn't seem to be in that part of it.

In her e-mail, Grace, after talking men and women and prenatal levels of testosterone, says it all suggests to her "that some part of intelligence is genetic, just like identical twins raised apart tend to have very similar IQs and just like I think my babies will be geniuses and beautiful individuals whether I raise them or give them to an orphanage in Nigeria." In one breathtaking passage, she manages to insult women, Nigeria and orphanages. (Does she not believe there are any beautiful, orphaned Nigerian baby geniuses?)

Grace has apologized, now that her prime clerkship is on the line, writing, "I never intended to cause any harm, and I am heartbroken and devastated by the harm that has ensued." So is she upset her thoughts were made public, or does she really think that suggesting a whole race of people could be genetically inferior wouldn't actually hurt anyone? Missing was any concern about those she maligned. Grace certainly has the right to express any view; she can't and shouldn't be able to control how people react to it.

But then, it was never about the African-Americans in the e-mail. It's as though they are specimens in a not-very-intelligent intellectual argument and don't even have the right to be offended. Calling Grace's sentiments "racist" is worse, some defenders say, than the racism embedded in them.

My colleague Sarah Wildman writes about Grace and others tripped up by their own words. It's more than a random slip after too much wine, of course.

It's all about her – and a particularly odious excuse for white privilege. I've seen it in action when the accomplishments of minorities belong to affirmative action but their failures are all their own. I've seen the sense of entitlement, not only but occasionally on the lovely and genteel Harvard campus. (I spent a fellowship year there.) The belief in innate superiority may not make sense but it absolutely confirms the certainty of those on top that they deserve absolutely everything they get – and money and opportunity and connections and luck have nothing to do with it.

That kind of thinking defies logic. But logic left the argument long ago, even before the ones sitting on the shaded porch drinking lemonade or something stronger judged the field hands working dawn to dusk the lazy and shiftless ones. The argument of inferior intelligence was used then; it's no surprise that it's still with us.

Growing up in a neighborhood diverse in every way but race, it didn't take me long to figure out that people are different. They can be nice or nasty or both, clever or slow, hard-working or not. Some of the people I saw every day were gifted in music, others in athletics. You could trust some and dare not turn your back on others. It had nothing to do with skin color, since that was the one trait we all shared (though, now that I think of it, even that ranged from very black to very white).

It wasn't until I moved into the wider and whiter world that I met those who would shove all the interesting characters in the old neighborhood into one not very desirable pile. I always knew better. But when people with those views have the power, it means something. That's why I don't buy the argument that what Stephanie Grace said was merely theoretical, harmless and not that bad. And even if it was, well, she shouldn't have to pay a price.

Everything has consequences, even words, especially when you are tasked with interpreting the law.

One wonders what Grace makes of two lawmakers at the top of her chosen profession -- Yale Law School graduates Sonia Sotomayor and Clarence Thomas. Both were dogged by whispers that disparaged their hard work and accomplishments as they rose to the Supreme Court; Thomas turned against the affirmative action that he believes tainted his law degree, he wrote in "My Grandfather's Son."

The thing Thomas doesn't seem to realize is, the taint didn't come from a policy that gave him an opportunity to achieve, but from the casual assumption of white privilege that -- in the rare case of Stephanie Grace -- might actually hurt more than help her. Then again, given the history of this country – even a history that includes the election of her fellow Harvard law grad -- I'm not so sure.

KBR Gets No-Bid Contract Hours After Fraud Charges

KBR to Get No-Bid Army Work as U.S. Alleges Kickbacks

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KBR Inc. was selected for a no-bid contract worth as much as $568 million through 2011 for military support services in Iraq, the Army said.

The Army announced its decision yesterday only hours after the Justice Department said it will pursue a lawsuit accusing the Houston-based company of taking kickbacks from two subcontractors on Iraq-related work. The Army also awarded the work to KBR over objections from members of Congress, who have pushed the Pentagon to seek bids for further logistics contracts.

The Justice Department said the government will join a suit filed by whistleblowers alleging that two freight-forwarding firms gave KBR transportation department employees kickbacks in the form of meals, drinks, sports tickets and golf outings.

“Defense contractors cannot take advantage of the ongoing war effort by accepting unlawful kickbacks,” Assistant Attorney General Tony West said in a statement.

KBR, the Army’s largest contractor in Iraq, will review the litigation when it is received and “will continue to cooperate with the government,” company spokeswoman Heather Browne said in an e-mail. “Gifts of dinners, baseball tickets and similar items would violate KBR policies and KBR was not aware of these violations.”

KBR will continue to provide services in Iraq such as housing, meals, laundry, showers, water purification and bathroom cleaning under the new order, which was placed under a military contract KBR won in late 2001, shortly after the U.S. invaded Afghanistan.

‘Appropriate Safeguards’

The Army has “reviewed the government’s notice to intervene” in the whistleblower lawsuit, Army spokesman Dan Carlson said. “We feel we have appropriate safeguards in place” to protect the government’s interests.

The no-bid work order is unusual because the Army, at the insistence of Congress, has since April 2008 put all logistics orders to bid, pitting KBR against Falls Church, Virginia-based DynCorp International Inc. and Irving, Texas-based Fluor Corp.

The Army didn’t put this work out for bids because U.S. commanders in Iraq advised against it, saying that enlisting a new company would be too disruptive as the U.S withdraws, Army program director Lee Thompson said in an interview before the Justice Department action was announced.

Odierno’s View

The view of General Ray Odierno, the U.S. military commander in Iraq, was crucial to the decision, Army Chief of Staff General George Casey told reporters today.

“Odierno said, ‘I’ve got three million pieces of equipment I’ve got to get out of Iraq, I’ve got 100 or so bases to close, I’ve got to move 80,000-plus people out of here and you want me to change horses in the middle of the stream?’” Casey recounted.

The U.S. force in Iraq is scheduled to shrink from 94,000 troops today to 50,000 by August, with a complete withdrawal by December 2011.

The Army, in its statement yesterday, said putting to bid an order for 18 months’ work and making the transition to a new contractor would cost at least $77 million. The KBR work order will be awarded by Aug. 31, said Mike Hutchison, deputy director of Army logistics contracting.

Earlier U.S. Lawsuit

The lawsuit is the second government action this year against KBR. The U.S. sued the company on April 1, alleging that it used private armed security guards in Iraq between 2003 and 2006 in violation of its Army contract and then improperly billed for their services.

Before yesterday’s Justice Department announcement, the Army had said in an e-mailed statement that it was aware of the April lawsuit and would use “additional oversight measures to ensure only reasonable, allowable costs are paid” under the new work order.

The new lawsuit, filed in a Texas federal court, was based on information from two whistleblowers who work in the air cargo industry, the Justice Department statement said. The whistleblowers can get a portion of any money the Justice Department obtains in the case.

Senate Objections

KBR’s no-bid work order drew criticism from two U.S. senators even before it was announced.

Senator Claire McCaskill, the Missouri Democrat who heads a subcommittee that oversees military contracting, and the panel’s ranking Republican, Susan Collins of Maine, wrote Defense Secretary Robert Gates on April 30 urging the Army against “continued reliance” on KBR in light of the Justice Department’s April lawsuit.

“The Army has a big burden to demonstrate that a decision to not compete is in the best interest of the military and American taxpayers,” McCaskill said in a statement last night. “We will hold their feet to the fire and continue to demand accountability on this decision.”

Under the new competitive-bid approach, KBR on March 2 won a one-year, $571 million contract with four option years that, if exercised, could be worth as much as $2.77 billion.

That contract calls for KBR to provide services including transportation and postal operations. DynCorp initially protested the award and then dropped its objections.

New Research Revealed: Environmentally Caused Cancers Are 'Grossly Underestimated'

New Research Revealed: Environmentally Caused

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The President's Cancer Panel on Thursday reported that "the true burden of environmentally induced cancers has been grossly underestimated" and strongly urged action to reduce people's widespread exposure to carcinogens.

The panel advised President Obama "to use the power of your office to remove the carcinogens and other toxins from our food, water, and air that needlessly increase health care costs, cripple our nation's productivity, and devastate American lives."

The 240-page report by the President's Cancer Panel is the first to focus on environmental causes of cancer. The panel, created by an act of Congress in 1971, is charged with monitoring the multi-billion-dollar National Cancer Program and reports directly to the President every year.

Environmental exposures "do not represent a new front in the ongoing war on cancer. However, the grievous harm from this group of carcinogens has not been addressed adequately by the National Cancer Program," the panel said in its letter to Obama that precedes the report. "The American people even before they are born are bombarded continually with myriad combinations of these dangerous exposures."

The panel, appointed by President Bush, told President Obama that the federal government is missing the chance to protect people from cancer by reducing their exposure to carcinogens. In its letter, the panel singled out bisphenol A, a chemical used in polycarbonate plastic and can linings that is unregulated in the United States, as well as radon, formaldehyde and benzene. Environmental health scientists were pleased by the findings, saying it embraces everything that they have been saying for years.

Richard Clapp, a professor of environmental health at Boston University's School of Public Health and one of the nation's leading cancer epidemiologists, called the report "a call to action."

Environmental and occupational exposures contribute to "tens of thousands of cancer cases a year," Clapp said. "If we had any calamity that produced tens of thousands of deaths or serious diseases, that’s a national emergency in my view.”

The two-member panel Dr. LaSalle D. Lefall, Jr., a professor of surgery at Howard University and Margaret Kripke, a professor at University of Texas' M.D. Anderson Cancer Center – was appointed by President Bush to three-year terms.

Lefall and Kripke concluded that action is necessary, even though in many cases there is scientific uncertainty about whether certain chemicals cause cancer. That philosophy, called the precautionary principle, is highly controversial among scientists, regulators and industry.

"The increasing number of known or suspected environmental carcinogens compels us to action, even though we may currently lack irrefutable proof of harm," Lefall, who is chair of the panel, said in a statement.

The two panelists met with nearly 50 medical experts in late 2008 and early 2009 before writing their report to the president. Cyclist and cancer survivor Lance Armstrong previously served on the panel, but did not work on this year's report.

In 2007, 69 million CT scans were performed.

The report recommends raising consumer awareness of the risks posed by chemicals in food, air, water and consumer products, bolstering research of the health effects and tightening regulation of chemicals that might cause cancer or other diseases.

They also urged doctors to use caution in prescribing CT scans and other medical imaging tests that expose patients to large amounts of radiation. In 2007, 69 million CT scans were performed, compared with 18 million in 1993. Patients who have a chest CT scan receive a dose of radiation in the same range as survivors of the Hiroshima atomic bomb attacks who were less than half a mile from ground zero, the report says.

The panel also criticized the U.S. military, saying that "it is a major source of toxic occupational and environmental exposures that can increase cancer risk." Examples cited include Camp Lejeune in North Carolina, where carcinogenic solvents contaminate drinking water, and Vietnam veterans with increased lymphomas, prostate cancer and other cancers from thier exposure to the herbicide Agent Orange.

Overall cancer rates and deaths have declined in the United States. Nevertheless, about 41 percent of all Americans still will be diagnosed with cancer during their lifetime, and about 21 percent will die from it, according to the National Cancer Institute's SEER Cancer Statistics Review. In 2009 alone, about 1.5 million new cases were diagnosed.

For the past 30 years, federal agencies and institutes have estimated that environmental pollutants cause about 2 percent of all cancers and that occupational exposures may cause 4 percent.
Patients who have a chest CT scan receive a dose of radiation in the same range as survivors of the Hiroshima atomic bomb attacks who were less than half a mile from ground zero.But the panel called those estimates "woefully out of date." The panel criticized regulators for using them to set environmental regulations and lambasted the chemical industry for using them "to justify its claims that specific products pose little or no cancer risk."
The report said the outdated estimates fail to take into account many newer discoveries about people's vulnerability to chemicals. Many chemicals interact with each other, intensifying the effect, and some people have a genetic makeup or early life exposure that makes them susceptible to environmental contaminants.
"It is not known exactly what percentage of all cancers either are initiated or promoted by an environmental trigger," the panel said in its report. "Some exposures to an environmental hazard occur as a single acute episode, but most often, individual or multiple harmful exposures take place over a period of weeks, months, year, or a lifetime."
Boston University's Clapp was one of the experts who spoke to the panel in 2008. "We know enough now to act in ways that we have not done...Act on what we know," he told them.
“There are lots of places where we can move forward here. Lots of things we can act on now," such as military base cleanups and reducing use of CT scans, Clapp said in an interview.
Dr. Ted Schettler, director of the Science and Environmental Health Network, called the report an “integrated and comprehensive critique.” He was glad that the panel underscored that regulatory agencies should reduce exposures even when absolute proof of harm was unavailable.
Scientists are divided on whether there is a link between cell phones and cancer.
Also, "they recognized that exposures happen in mixtures, not in isolation" and that children are most vulnerable.
“Some people are disproportionately exposed and disproportionately vulnerable," said Schettler, whose group was founded by environmental groups to urge the use of science to address public health issues related to the environment.

Schettler said it "took courage" for the panel to warn physicians about the cancer risk posed by CT scans, particularly for young children.

“It’s almost become routine for kids with abdominal pain to get a CT scan" to check for appendicitis, he said. Although the scans may lead to fewer unnecessary surgeries, doctors should consider the high doses of radiation. “I'm very glad this panel took that on," Schettler said.

Another sensitive issue raised in the report was the risk of brain cancer from cell phones. Scientists are divided on whether there is a link.

Until more research is conducted, the panel recommended that people reduce their usage by making fewer and shorter calls, using hands-free devices so that the phone is not against the head and refraining from keeping a phone on a belt or in a pocket.

Even if cell phones raise the risk of cancer slightly, so many people are exposed that "it could be a large public health burden," Schettler said.

The panel listed a variety of carcinogenic compounds that many people routinely encounter. Included are benzene and other petroleum-based pollutants in vehicle exhaust, arsenic in water supplies, chromium from plating companies, formaldehyde in kitchen cabinets and other plywood, bisphenol A in plastics and canned foods, tetrachloroethylene at dry cleaners, PCBs in fish and other foods and various pesticides.

Chemicals and contaminants might trigger cancer by a variety of means. They can damage DNA, disrupt hormones, inflame tissues, or turn genes on or off.

"Some types of cancer are increasing rapidly," Clapp said, including thyroid, kidney and liver cancers. Others, including lung and breast cancer, have declined.

Previous reports by the President's Cancer Panel have focused largely on treatment and more well-known causes of cancer such as diet or smoking.
The panel criticized regulators and industry for using "woefully outdated" estimates of environmentally caused cancers to set regulations and "to justify its claims that specific products pose little or no cancer risk."Some experts are concerned that the report might just sit on a shelf at the White House. But Clapp said the findings are so strongly stated that he is confident the report will be useful to some policymakers, legislators and groups that want tougher occupational health standards or other regulations.
“We’re not going to get any better than this," Clapp said. “This goes farther than what I thought the President's Cancer Panel would go. I’m pleased that they went as far as they did."
Environmental health scientists said they hope the report raises not just the President's awareness of environmental threats, but the public's, since most people are unaware of the dangers.
“This report has stature," Schettler said. “It is a report that goes directly to the president.”

Congress Goes to Bat For Wall Street, Rejects Plan To Break up Banks

Congress Goes to Bat For Wall Street, Rejects Plan To Break up Banks

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Late last night, the U.S. Senate rejected the single most important element of Wall Street reform by a vote of 33 to 61. The SAFE Banking Act would have forced the break-up of the nation's six largest banks, and dramatically reduced the political clout of America's financial elite. The 61 votes against the measure are votes in favor of Wall Street's stranglehold on our economy. No matter what else is ultimately enacted in the name of Wall Street reform, Congress has decided that it will not confront the single greatest problem in the U.S. economy: too big to fail.

On Wednesday, the Senate also voted down a $50 billion Wall Street tax that would have been used to fund the cost of shutting down a major failing bank. By rejecting both the break-up bill and the bank tax, the Senate has punted on ending too-big-to-fail. For now, it appears that Wall Street has emerged from the Great Financial Crash of 2008 with even greater political might than it wielded during the reign of George W. Bush. In the Citizens United era, both Democrats and Republicans have decided they can only get so tough with Corporate America.

Last night, 27 Democrats joined all but three Republicans to vote against breaking up the banks. President Barack Obama opposed both the tax and the break-up measures, and hosted J.P. Morgan Chase CEO Jamie Dimon for dinner at the White House on Monday. J.P. Morgan is the largest U.S. bank, and spent more money on lobbying in 2009 than any other bank. House Minority Leader John Boehner, R-Ohio, has aggressively courted Dimon for campaign cash.

There is literally no economic evidence that megabanks do anything to help the economy that cannot be accomplished with smaller institutions. By contrast, centuries of research has shown that giant banks are destructive. Adam Smith was warning against the dangers of megabanking back in the 18th century. And the current crisis in Europe-- which appears to be deepening by the day-- should make those dangers apparent to everyone living in today's economy. There are plenty of good economic reasons to cut our financial behemoths down to size, and no good reasons not to.

The good news is, there are still some smaller-bore reforms in the legislation that are worth voting for, and it appears that some version of reform, however tepid, will ultimately be approved. Congress will be deploying a screwdriver to perform a job fit for a bulldozer, but a few weeks ago, it was not obvious that even the screwdriver would make it through.

Shortly before the vote on breaking up the banks, Sen. Bernie Sanders, I-Vermont, cut a deal with Sen. Chris Dodd, D-Conn., that would subject all of the Federal Reserve's bailout operations to a thorough public audit. Despite all of the attention heaped on the Treasury Department and the Troubled Asset Relief Program, the Fed has operated as the chief bailout engine of the U.S. government, pumping $4.3 trillion into the banking system without almost no public disclosure. We don't know who received money, or on what terms, or who approved the transactions. It now appears very likely that this information will finally see the light of day. Obama, who had opposed a more comprehensive Fed audit, now supports the Sanders plan.

But by allowing megabanks to remain super-sized, Congress has insulated them from the fallout associated with the Fed disclosures, and given them a tool to fight other reforms. Our giant financial institutions are not only too-big-to-fail, they are too-big-to-regulate. There are meaningful reforms still on the table—a ban on risky proprietary trading, an overhaul of consumer protection and the reining in of the crazy derivatives casino that brought down AIG—but all will be much more difficult to enforce at the complex megabanks which currently dominate both the marketplace and Capitol Hill.

Major economic realignments are not quickly established. It took seven years for Franklin Delano Roosevelt to pass all of his New Deal-era banking reforms. We have known for some time that this legislation, however stringent, would be incomplete. Hedge funds, credit rating agencies, Fannie Mae and Freddie Mac all must be addressed by separate legislation. The SAFE Banking Act must be considered in every subsequent reform package.

These are the senators who voted last night to preserve Wall Street's power. Senators in bold also voted for the bailout bill in 2008:

Akaka (D-HI)

Alexander (R-TN)

Barrasso (R-WY)

Baucus (D-MT)

Bayh (D-IN)

Bennet (D-CO)

Bond (R-MO)

Brown (R-MA)

Brownback (R-KS)

Burr (R-NC)

Carper (D-DE)

Chambliss (R-GA)

Cochran (R-MS)

Collins (R-ME)

Conrad (D-ND)

Corker (R-TN)

Cornyn (R-TX)

Crapo (R-ID)

Dodd (D-CT)

Enzi (R-WY)

Feinstein (D-CA)

Gillibrand (D-NY)

Graham (R-SC)

Grassley (R-IA)

Gregg (R-NH)

Hagan (D-NC)

Hatch (R-UT)

Hutchison (R-TX)

Inhofe (R-OK)

Inouye (D-HI)

Isakson (R-GA)

Johanns (R-NE)

Johnson (D-SD)

Kerry (D-MA)

Klobuchar (D-MN)

Kohl (D-WI)

Kyl (R-AZ)

Landrieu (D-LA)

Lautenberg (D-NJ)

LeMieux (R-FL)

Lieberman (ID-CT)

McCain (R-AZ)

McCaskill (D-MO)

McConnell (R-KY)

Menendez (D-NJ)

Murkowski (R-AK)

Nelson (D-FL)

Nelson (D-NE)

Reed (D-RI)

Risch (R-ID)

Roberts (R-KS)

Schumer (D-NY)

Sessions (R-AL)

Shaheen (D-NH)

Snowe (R-ME)

Tester (D-MT)

Thune (R-SD)

Udall (D-CO)

Voinovich (R-OH)

Warner (D-VA)

Wicker (R-MS)

Look Out, Obama Seems to Be Planning for a Lot More War

Look Out, Obama Seems to Be Planning for a Lot More War

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There's more war in America's future - a great deal more, judging by the Barack Obama administration's reports, pronouncements and actions in recent months.

These documents and deeds include the Quadrennial Defense Review (QDR), the Nuclear Posture Review (NPR), the Ballistic Missile Defense Report, the nuclear security summit in New York and the May 3-28 United Nations nuclear Non-Proliferation Treaty review conference, as well as the continuing wars in the Middle East and Central Asia, and the 2011 Pentagon war budget request.

The United States government presides as a military colossus of unrivalled dimension, but the QDR, which was published in February, suggests Washington views America as being constantly under the threat of attack from a multitude of fearsome forces bent on its destruction. As such, trillions more dollars must be invested in present and future wars - ostensibly to make safe the besieged homeland.

The NPR says the long-range US goal is a "nuclear-free" world, but despite token reductions in its arsenal of such weapons, the Pentagon is strengthening its nuclear force and bolstering it with a devastating "conventional deterrent" intended to strike any target in the world within one hour. In addition this document, published in April, retains "hair-trigger" nuclear launch readiness, refuses to declare its nuclear force is for deterrence only (suggesting offensive use) and for the first time authorizes a nuclear attack, if necessary, on a non-nuclear state (Iran).

Meanwhile, Obama is vigorously expanding the George W Bush administration's wars, and enhancing and deploying America's unparalleled military power.

The Obama administration's one positive achievement in terms of militarism and war was the April 9 signing in Prague of the new Strategic Arms Reduction Treaty with Russia that reduces deployed strategic nuclear weapons to 1,550 warheads each. It was a step forward, but all agree it was extremely modest, and it does not even faintly diminish the danger of nuclear war.

The QDR is a 128-page Defense Department report mandated by congress to be compiled every four years to put forward a 20-year projection of US military planning. A 20-member civilian panel, selected by the Pentagon and congress, analyzes the document and suggests changes in order to provide an "independent" perspective. Eleven of the members, including the panel’s co-chairmen - former defense secretary William Perry and former national security adviser Stephen Hadley - are employed by the defense industry.

Although the Pentagon is working on preparations for a possible World War III and beyond, the new report is largely focused on the relatively near future and only generalizes about the longer term. Of the QDR's many priorities three stand out.

# The first priority is to "prevail in today's wars" in Afghanistan, Pakistan, Iraq, Yemen and wherever else Washington's post-9/11 military intrusions penetrate in coming years. Introducing the report February 1, Bush-Obama Defense Secretary Robert Gates issued this significant statement: "Success in wars to come will depend on success in these wars in progress." The "wars to come" were not identified. Further, the QDR states that military victory in Iraq and Afghanistan
is "only the first step toward achieving our strategic objectives".
# Second, while in the past the US concentrated on the ability to fight two big wars simultaneously, the QDR suggests that's not enough. Now, the Obama administration posits the "need for a robust force capable of protecting US interests against a multiplicity of threats, including two capable nation-state aggressors."

Now it's two-plus wars - the plus being the obligation to "conduct large-scale counter-insurgency, stability and counter-terrorism operations in a wide range of environments", mainly in small, poor countries like Afghanistan. Other "plus" targets include "non-state actors" such as al-Qaeda, "failed states" such as Somali, and medium-size but well-defended states that do not bend the knee to Uncle Sam, such as Iran or the Democratic People's Republic of Korea, and some day perhaps Venezuela.
# Third, it's fairly obvious from the QDR, though not acknowledged, that the Obama government believes China and Russia are the two possible "nation-state aggressors" against which Washington must prepare to "defend" itself. Neither Beijing nor Moscow has taken any action to justify the Pentagon's assumption that they will ever be suicidal enough to attack the far more powerful United States.

After all, the US, with 4.54% of the world's population, invests more on war and war preparations than the rest of the world combined. Obama's 2010 Pentagon budget is US$680 billion, but the real total is double that when all Washington's national security expenditures in other departmental budgets are also included, such as the cost of nuclear weapons, the 16 intelligence agencies, Homeland Security and interest on war debts, among other programs.

Annual war-related expenditures are well over $1 trillion. In calling for a discretionary freeze on government programs in January's state of the union address, Obama specifically exempted Pentagon/national security expenditures from the freeze. Obama is a big war spender. His $708 billion Pentagon allotment for fiscal 2011 (not counting a pending $33 billion Congress will approve for the Afghan "surge") exceeds Bush's highest budget of $651 billion for fiscal 2009.

At present, US military power permeates the entire world. As the QDR notes: "The United States is a global power with global responsibilities. Including operations in Afghanistan and Iraq, approximately 400,000 US military personnel are forward-stationed or rotationally deployed around the world."

The Pentagon presides over 1,000 overseas military bases (including those in the war zones), great fleets in every ocean, a globe-spanning air force
, military satellites in space and nuclear missiles on hair trigger alert pre-targeted on "enemy" or potential "enemy" cities and military facilities. A reading of the QDR shows none of this will change except for upgrading, enlarging (the Pentagon just added six new bases in Colombia) and adding new systems such as Prompt Global Strike, an important new offensive weapon system, which we shall discuss below.

The phrase "full spectrum military dominance" - an expression concocted by the neo-conservatives in the 1990s that was adopted by the Bush administration to define its aggressive military strategy - was cleverly not included in the 2010 QDR, but retaining and augmenting dominance remains the Pentagon's prime preoccupation.

The QDR is peppered with expressions such as "America’s interests and role in the world require armed forces with unmatched capabilities" and calls for "the continued dominance of America’s Armed Forces in large-scale force-on-force warfare". Gates went further in his February 1 press conference: "The United States needs a broad portfolio of military capabilities, with maximum versatility across the widest possible spectrum of conflicts." Obama bragged recently that he commanded "the finest military in the history of the world".

Evidently, the Pentagon is planning to engage in numerous future wars interrupted by brief periods of peace while preparing for the next war. Given that the only entity expressing an interest in attacking the United States is al-Qaeda - a non-government paramilitary organization of extreme religious fanatics with about a thousand reliable active members around the world - it is obvious that America's unprecedented military might is actually intended for another purpose.

In our view that "other purpose" is geopolitical - to strengthen even further the Pentagon's military machine to assure that the United States retains its position as the dominant
global hegemon at a time of acute indebtedness, the severe erosion of its manufacturing base, near gridlock in domestic politics, and the swift rise to global prominence of several other nations and blocs.

The QDR touches on this with admirable delicacy: "The distribution of global political, economic and military power is shifting and becoming more diffuse. The rise of China, the world’s most populous country, and India, the world’s largest democracy, will continue to reshape the international system. While the United States will remain the most powerful actor, it must increasingly cooperate with key allies and partners to build and sustain peace and security. Whether and how rising powers fully integrate into the global system will be among this century’s defining questions, and are thus central to America’s interests."

At the moment, the QDR indicates Washington is worried about foreign "anti-access" strategies that limit its "power projection capabilities" in various parts of the world. What this means is that certain countries such as China and Russia are developing sophisticated new weapons that match those of the US, thus "impeding" the deployment of American forces to wherever the Pentagon desires. For instance:

China is developing and fielding large numbers of advanced medium-range ballistic and cruise missiles, new attack submarines equipped with advanced weapons, increasingly capable long-range air defense systems, electronic warfare and computer network attack capabilities, advanced fighter aircraft and counter-space systems. China has shared only limited information about the pace, scope and ultimate aims of its military modernization programs, raising a number of legitimate questions regarding its long-term intentions.

To counter this trend in China and elsewhere, the Pentagon is planning, at a huge and unannounced cost, the following enhancements: "Expand future long-range strike capabilities; Exploit advantages in subsurface operations; Increase the resiliency of US forward posture and base infrastructure; Assure access to space and the use of space assets; Enhance the robustness of key ISR (Intelligence, Surveillance, and Reconnaissance) capabilities; Defeat enemy sensors and engagement systems; and Enhance the presence and responsiveness of US forces abroad."

In addition, the US not only targets China with nuclear missiles and bombs, it is surrounding the country (and Russia as well, of course) with anti-ballistic missiles. The purpose is plain: In case the US finds it "necessary" to launch ballistic missiles toward China, the ABMs will be able to destroy its limited retaliatory capacity.

According to an article in the February 22 issue of China Daily, the country's English-language newspaper: "Washington appears determined to surround China with US-built anti-missile systems, military scholars have observed ... Air force colonel Dai Xu, a renowned military strategist, wrote in an article released this month that 'China is in a crescent-shaped ring of encirclement. The ring begins in Japan, stretches through nations in the South China Sea to India, and ends in Afghanistan'."

Compared to the Bush administration's 2006 QDR, there has been a conscious effort to tone down the anti-China rhetoric in the current document. But it is entirely clear that China is number one in the QDR's references to "potentially hostile nation states".

According to the February 18 Defense News, a publication that serves the military-industrial complex, "Analysts say the QDR attempts to address the threat posed by China without further enraging Beijing. 'If you look at the list of further enhancements to US forces and capabilities ... those are primarily capabilities needed for defeating China, not Iran, North Korea or Hezbollah,' said Roger Cliff, a China military specialist at Rand. 'So even though not a lot of time is spent naming China ... analysis of the China threat is nonetheless driving a lot of the modernization programs described in the QDR'."

Incidentally, according to the Center for Arms Control and Non-Proliferation, this year's Chinese defense budget, for a country four times larger than the United States, is $78 billion, compared to the $664 billion for the Pentagon (without all the national security extras harbored in other department budgets). China possesses 100-200 nuclear warheads compared to America's 9,326 (when both deployed and stored weapons are included). China is contemplating the construction of an aircraft carrier; the US Navy floats 11 of them. China has no military bases abroad.

In our view, China appears to be constructing weapons for defense, not offense against the US - and its foreign policy is based on refusing to be pushed around by Washington while doing everything possible to avoid a serious confrontation.

Russia as well is treated better in the new QDR than in 2006, but it is included with China in most cases. Despite Moscow's huge nuclear deterrent and abundant oil and gas supplies, it's only "potential enemy" number two in terms of the big powers. Washington feels more threatened by Beijing. This is largely because of China's size, rapid development, fairly successful state-guided capitalist economy directed by the Communist Party, and the fact that it is on the road to becoming the world's economic leader, surpassing the US in 20 to 40 years.

It seems fairly obvious, but hardly mentioned publicly, that this is an extremely dangerous situation. China does not seek to dominate the world, nor will it allow itself to be dominated. Beijing supports the concept of a multipolar world order, with a number of countries and blocs playing roles. At issue, perhaps, is who will be first among equals.

Washington prefers the situation that has existed these 20 years after the implosion of the Soviet Union and much of the socialist world left the United States as the remaining military superpower and boss of the expanded capitalist bloc. During this time Washington has functioned as the unipolar world hegemon and doesn't want to relinquish the title.

This is all changing now as other countries rise, led by China, and the US appears to be in gradual decline. How the transition to multi-polarity is handled over the next couple of decades may determine whether or not a disastrous war will be avoided.

Greek debt crisis: death and destruction in Athens

Greek debt crisis: death and destruction in Athens

Everyone's furious with Greece over its debt – even its own people. What went so wrong? A report from the teargas-drenched streets of Athens

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Smoke billows behind Hadrian's Arch and Acropolis during the protests this week.

Smoke billows behind Hadrian's Arch and Acropolis during the protests this week. Photograph: KPA/Zuma/Rex Features

It began as a fiesta, a mass march in the sun against the deflationary programme the Greek people are being told can alone save their country. At 10 on Wednesday morning, Klathmonos Square in Athens was filling with protesters. A union official was making an interminable speech (Greeks never use one word when 300 will do), and music was blaring out of vans – those Chilean-style revolutionary songs without which no demo is complete: "The people, united, will never be defeated." Not today, anyway.

People had said there would be no violence – or at least if there was, it would be "ritual" violence: a broken window here, a wrecked ATM there. One Greek journalist had told me the protests so far had been subdued – "equivalent to what would normally happen here if the electricity board sacked a few people". He said the public were resigned to the economic hardships to come – salaries of state employees cut by 25%, pensions to fall by 15%, unemployment likely to rise to 18% – and that they recognised the only alternative was national bankruptcy; not just junk bonds but a junk country.

A few hours later, three bank workers, one a woman who was four months pregnant, lay dead in a burnedout bank on Stadiou Avenue, the victims of anarchist firebombs. Ritual violence this was not, and by Wednesday evening Athens feels drained and lifeless. "This will make people stop and think," teacher Anna Tsiokou tells me, as we stand beside the police cordon on the edge of the area where the firebombing had occurred. "The demonstrations will have to stop for the moment. We have legitimate grievances, but the anarchists are using the crisis for their own ends."

The writer Apostolos Doxiadis, whom I had met the previous day, rings me as I sit in a cafe close to Stadiou, and offers to come down from his office 20 minutes away and help me make sense of what has happened. Doxiadis has an interest in terrorism because last year his office was firebombed, after he and two fellow writers had taken a public stand against political violence and disruption of artistic events by sympathisers of the riots of December 2008 (when the police shooting of a schoolboy led to weeks of unrest).

A protester throws a stone at police near parliament. A protester throws a stone at police near parliament. Photograph: Aris Messinis/AFP/Getty Images

"What's so surprising is that there haven't been more deaths before," Doxiadis says. "Those of us who have been outspoken against violence from the beginning are not, I'm sorry to say, surprised, because there's been extreme violence of many forms. But this tragedy will start to make people think seriously, and find other ways to register their dissent. We are in a complex situation, and we have reached a tipping point today."

Just before midnight on Wednesday, as Athens finally starts to rest after a fearful and violent day, I have a coffee with an anarchist in Omonia Square, the traditional heart of violent protest in the city. He tells me he was close to the attack on the bank. His emotions are confused. He is sorry for the deaths, but will not accept the anarchists are to blame.

"The government are presenting this as murder," he says, "but it was a tragic accident. Anarchism is about material damage; it is not about taking life." Perversely, he blames the bank for allowing workers to be there on a day when it should have realised banks would be targeted.

"I am shocked, devastated," he says. "It will make me rethink whether I will ever throw a petrol bomb again." Yet, a few minutes later, he tells me that he will do just that if faced with a line of policemen who threaten him and his "comrades".

"When one of us is killed in a non-combat situation, it doesn't even get reported. I said people were going to die in Greece. This isn't the G20 protest outside RBS; this is about people's lives. Everyone here will be affected in some shape or form."

He believes Greece is at a potentially revolutionary moment – a point of view held by virtually no one except anarchists, communists and the fringe left – and, while he sympathises with the three innocent bank workers, mostly he is disappointed that the cause has been set back, the revolutionary momentum lost. The deaths have given even the anarchists pause for thought, and the evening's battles in Omonio and the neighbouring district of Exarchia have been less extensive than might otherwise have been the case.

The general strike, the mass demonstration and the deaths occur on my third day in Greece, a country now in such crisis that it is being painted as an international pariah. "This is the biggest crisis for Greece since the dictatorship [the 'rule of the colonels' from 1967-74]," says novelist Petros Tatsopoulos, at his flat in the northern suburbs of Athens, two days before the killings. "But this is not only our fault. There has been a chain reaction from the [subprime mortgage] crisis starting in the US two years ago, and Greece was the weakest link in the chain in Europe. Traders have been gambling on the bankruptcy of Greece, and that is a very dirty game."

Tatsopoulos accepts Greece is now the "black goat" of Europe – it takes me a while to grasp the slight difference between the English and Greek expressions – but again stresses it is not solely the fault of his country. The collapse in relations between Greece and Germany – the latter was tardy in agreeing the loans needed to prop up Greece – becomes evident. "The Germans think we are the black goat, and that there would be no problems in the eurozone if Greece wasn't a member," he says. "But the Greeks think the Germans are the last people to talk, because they didn't pay reparations to us after the occupation in the second world war."

The number of tourists from Germany is predicted to drop by two-thirds this summer, a further disaster for an economy dangerously dependent on tourism and the service sector. Tatsopoulos foresees the severe public sector cuts and tax rises imposed by the EU and International Monetary Fund – the quid pro quo for their £95bn bailout package – provoking a social crisis; particularly as the country is being led by an ostensibly socialist government. "The Greek people can't stand any more," he says. "Greece is a very expensive country; prices are very high, but salaries are already low, and they won't be able to take more cuts in wages. There will be a revolt in the streets."

The taxi driver who takes me from Tatsopoulos's flat to Syntagma Square, home of the Greek parliament, tells me in broken English how fearful the public are. In part, he blames journalists. "They have made the people scared. The people don't know what they should do to get out of this." He also says journalists should have warned of the gathering crisis. "I think they are taking money from the government and the banks," he says. Greeks, several people tell me, are great conspiracy theorists.

There have been smaller daily demonstrations in Syntagma Square in the run-up to Wednesday's mass demo. Now it is the turn of the town hall workers, and John Maravelakis, who is selling copies of Workers Solidarity, explains why he has come. "If the working class succeed in their conflict with the government and stop this offensive, things are going to be better for Greece. Otherwise, we are going to live in hell. Working conditions will be destroyed, we will earn less, and there will be no jobs for younger people."

Maravelakis describes his paper as representing the anti-capitalist left, and has no time for George Papandreou's government. "We have a socialist government like Stalin was a socialist in Russia. They did not vote for Papandreou last October to implement monetarist policies. That is why people are angry."

That anger is palpable everywhere. That afternoon, I am sitting outside a cafe close to Syntagma, when a waiter offers to put up an awning. "No, I like the sun," I say, "the good Greek sun." "That's all we have left," he says. I laugh. "Don't laugh," he says. "We don't have the motivation right now to go to work. We hear bad news every day, and that affects us in a bad way. We are responsible for this, because we are electing the same people every time to be the government. They took the money, most of them; they are corrupt. And now they ask us to make sacrifices. We didn't steal the money. My salary here is €700 a month. I can't afford to pay more taxes or lose my Christmas and Easter bonuses." Greeks call those bonuses the "13th and 14th salaries", and the fact they are being removed is cited repeatedly.

Why has Greece reached this desperate state, I ask Alexis Papahelas, executive editor of the national newspaper Kathimerini and Greece's best-known journalist, when I meet him at his paper's offices overlooking the Aegean. "Politicians failed to exercise any kind of leadership," he says. "They let populism take over. And the public have been in denial. Somebody said to me recently it was all media hype, just like swine flu – that nothing would happen in the end. Well, we are going through the realisation process right now, and this week's announcements were the final shock. People now recognise it's for real, it's going to change our lives, and there's no going back. But somebody has to sell them some hope. We need a positive narrative about how Greece can get out of this."

What will the political impact be? "It's very hard to predict," Papahelas says. "People are looking for a messiah. They'd like some successful businessman, a Berlusconi figure, to come forward, and that is a scary thought. Papandreou has one more chance to re-establish his government, but I think the period of pain will be too long."

Like many pundits in Greece, Papahelas points to the dead weight of the public sector as the single biggest factor dragging Greece down, making the government deficit impossible to deal with, and killing enterprise. "It's been the dream of every kid coming out of high school or university to be appointed somewhere in the state apparatus – to get a permanent job on good money and not necessarily work hard. That's over. It delivered jobs for a while, but now the state is bankrupt."

Tax evasion is also endemic: the black economy accounts for almost 30% of the total economy. Inefficiency is rife: everyone points to the education system, where the pupil-teacher ratio is the lowest in Europe (about seven to one), yet standards in state schools are relatively poor.

Neoliberal economists, such as former finance minister Stefanos Manos, believe Greece needs a Margaret Thatcher, willing to take on vested interests, sweep away the occupational closed shops, and sack hundreds of thousands of state employees. Others, while admiring his ideological purity, think the cure would probably kill the patient.

The problem for those who oppose the austerity package is that they end up merely defending ancient privileges. As critics like to point out, the Greek left is deeply conservative – and hopelessly factionalised, too. On the morning of the big demo, I talk to two communists who are putting up posters on the street where the murders will later take place. They seem less interested in policy than in claiming to be the one true Stalinist faith.

"We are the true Communist party," one says. "The other Communist party are reformists." As elsewhere in Europe (New Labour springs to mind), the traditional left has become technocratic and managerialist, and the parties further to the left largely irrelevant – although Greece's communists, alone in Europe, retain some residual strength,and can close the Parthenon when the urge takes them.

The novelist and cultural commentator Takis Theodoropoulos, whom I meet at the foot of the Acropolis shortly after it has been occupied by protesting trade unionists, likens Greece's current condition to emerging from a nightclub at dawn. A cultural conservative with a shock of grey hair, he believes that the past five years have been a social, as well as an economic, disaster, marked by an obsession with materialism, the rejection of traditional Greek values, and a belief that people could spend as much as they liked without ever having to pay.

"We transformed Greece into a nightclub," he says, "but how long can you live in a nightclub? It's not only a matter that at five in the morning, you have to pay the bill. There's also the fact that psychologically you get out and you are ruined. You are a wreck. This is a society which is tired and depressed, profoundly depressed. That is not just a privilege of Greek society – the whole of European society is more or less depressed – but I don't know how we are going to get out of here."

Theodoropoulos, who has mined Greek history in his novels and essays, says that in many ways Greece's travails mirror the collapse of Athenian society that Plato described in The Republic. Perhaps the mention of Plato cheers him up, because he suggests the current crisis might offer a form of catharsis. "In Greek, the word 'crisis' has two meanings," he explains. "One is the same as in English, a situation which is uncertain and not under control. But it also means the intellectual energy you need in order to realise what's happening to you. In Greek you can say, 'This man is in a crisis', but you can also say, 'This man has crisis'. That is our only hope."

Theodoropoulos may be able to see the cathartic benefits of social purification, but the workers I meet each day protesting in Syntagma Square think more viscerally. When the teachers hold their own demo on Tuesday afternoon, I ask Elena Tsiadi whether she really believes the protests will achieve anything. "I don't know if we are going to achieve anything," she says. "Realistically speaking, I don't think we will. But when you are led to the corner, you have to react. We want someone to pay for what we will suffer. In Iceland, they went bankrupt and already six ministers are on trial. Here, we have a series of governments which have committed crimes, and no one is paying. They are asking us to pay the bill. Greeks are a particular kind of people who say, 'We are willing to work, willing to suffer, willing to make sacrifices,' as long as we have leaders who pay first. Somebody has got to set an example."

The following day, I am back in Syntagma with the huge crowd – estimated by the police at 30,000, by the protesters at almost double that – marking the day of the general strike. For an hour or so, the crowd confronts the police ringing parliament. Even before the masked anarchists in their black uniforms arrive, there are violent scenes, with bottles, sticks and metal railings being thrown by small groups of protesters on the ramparts at each side of the building. This, though, is containable, and has a theatrical element, the crowd venting their feelings like an audience as the mini-battles play themselves out.

But once the anarchists enter the square, with the police in pursuit firing tear gas, the atmosphere changes instantly. The gas chokes you and makes your eyes stream. Anarchists wielding heavy mallets, with which they break off pieces of concrete to use as weapons, are arguing furiously with middle-aged women in the fleeing crowd. The latter accuse them of having wrecked the march, though the extent of the disaster is not yet clear.

I try to take refuge alongside other journalists in the parliament building, which commands a view of the entire square – by now a battlefield. But the policeman on the gate tells me I lack the necessary permit. "No money, no honey," he says with a laugh. I pass a man in an immaculate suit who is clutching a handkerchief to his mouth, and ask him whether he works in the parliament building. "No, I am an honest Greek," he responds in a flash. He tells me he is a lawyer. "I wanted to be in the square with the people, but the stench is too much."

While the battle rages and before news of the deaths has emerged, I have to go to do a prearranged interview with Antonis Liakos, professor of modern history at the University of Athens. This must be the strangest interview I've ever conducted, because it takes place in a cafe only a couple of hundred metres away from Syntagma, in a pedestrianised street where people are still sitting outside, despite the whiff of tear gas from the square.

Liakos is critical of the austerity measures, and says the approach needs to be more "nuanced". A government with more bargaining power would, he suggests, be able to pick and choose which of the measures to apply. Like several of those I talk to, he argues that you can't have European monetary union without political union, because the states will never be in synch economically. Many leading figures in Greece now back political union, and it is possible to foresee inexorable pressure towards a superstate that would leave the UK, always lukewarm on matters European, entirely out in the cold. The Greek crisis is the first chapter of a Europe-wide story that could go anywhere.

Liakos believes there is a danger that, as in the 1930s, economic crisis may encourage the rise of anti-democratic groups across Europe. "We don't know how things are going to change in the rest of Europe," he says. "If Spain is in the same situation as Greece, then the whole euro stability pact will come under threat. The worst scenario is that European monetary union is going to sink. Imagine you are living in 1932: you can't anticipate the second world war and the catastrophe that was derived from the economic crisis. Perhaps we, too, can't see what is before our eyes."

After the meeting, I return to the square. The battle is over, an eerie calm has descended, and the pall of gas is dispersing. The police are still lined up in front of the Tomb of the Unknown Soldier, just beneath the parliament, but the only people left are two young men sitting on the kerb holding red flags. One, a student who has smothered his face in special white paint that mitigates the effects of the gas, tells me his friend has two degrees but can't get a job, and he doesn't want to be in the same position when he graduates.

I ask whether, at the height of the battle, the Tomb came under assault. "No," says the student, "we respect the monument. It is not the enemy, the cops are not the enemy – it's the people inside the parliament who are the enemy, but they don't come out."

At that point, another young man who has been listening to our conversation approaches. He disagrees with the student. "Just look at this," he says, pointing to the line of policemen in front of the Tomb. "People gave their lives in the war so that this monument to freedom could be built. Now the police stop the people from getting to it. The monument is shit. Today we have lost our freedom."

We don't know it yet, but on the broad avenue that leads down to the square, three people have lost much more – their lives. This peculiar calm in Syntagma, with Japanese tourists taking pictures of the debris, policemen slowly removing their gas masks and lighting cigarettes, and a young man walking past holding a broken violin, precedes a storm that will shortly break, exploding the myth that violence can be ritualised, theatrical, innocent.

The staff of the ornate Grand Bretagne hotel, which adorns one side of the square, are already scrubbing the anarchists' graffiti from its marble facade, but the lives lost today cannot be restored. Greece's monumental debit column now has its starkest entry.

The (Almost) Crash of Wall Street

The (Almost) Crash of Wall Street

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Ninety minutes before the end of the trading day Thursday, the U.S. stock market almost melted down. The Dow Jones Industrial Average dropped nearly 1,000 points. The market regained ground before the end, like a giant 747 narrowly averting a crash landing, but the questions of the day are: What happened? And what does it mean?

At this point no one knows why. Some say it was sudden burst of worries about Greece's debt and the increasing possibility of a default that might cause a run by global investors. Others point to a "trading error." Giant high-speed computers generate millions of trades based on instructions embedded in computer programs designed to move fast enough to beat everyone else. So when there's a glitch in one of them it can immediately spread to all the other programs designed to move just as fast. Some say it was an erroneous trade entered by someone at a big Wall Street bank who mistyped an order to sell a large block of stock, and that the big drop in that stock's price (Procter & Gamble?) triggered "sell" orders across the market.

Regardless of why it happened, it's further evidence that the nation's and the world's capital markets have become a vast out-of-control casino in which fortunes can be made or lost in an instant -- which would be fine except for the fact that most of us have put our life savings there. Pension funds, mutual funds, school endowments -- the value of all of this depends on a mechanism that can lose a trillion dollars in minutes without anyone having a clear idea why. So much of the market now depends on computer programs and mathematical models that no one fully understands, so much trading is in the hands of a few people whose fat thumbs or momentary carelessness might sink the economy, so much of global wealth now depends on who can move their money quickest at the slightest provocation -- that we are toying with financial disaster every day. The luck or foolishness of a few traders, and inside knowledge and information that some possess and others don't, combined with ultra high-speed computers, put us all at the whim of a system whose risk is way out of proportion to any public benefits.

The financial reforms being considered on Capitol Hill are steps in the right direction. But the "systemic risk" now embedded in our capital markets is higher than ever, and will require far greater understanding and vigilance than now being considered.

Pentagon Carves Africa Into Military Zones

New Colonialism: Pentagon Carves Africa Into Military Zones

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Last year the commander of U.S. Africa Command (AFRICOM), General William Ward, said the Pentagon had military partnerships with 35 of the continent's 53 nations, "representing U.S. relationships that span the continent." [1]

That number has increased in the interim.

As the first overseas regional military command set up by Washington in this century, the first since the end of the Cold War, and the first in 25 years, the activation of AFRICOM, initially under the wing of U.S. European Command on October 1, 2007, then as an independent entity a year later, emphasizes the geostrategic importance of Africa in U.S. international military, political and economic planning.

Africa Command's area of responsibility includes more nations - 53, all African states except Egypt, which remains in U.S. Central Command, and the Sahrawi Arab Democratic Republic (Western Sahara), which is a member of the African Union but which the U.S. and its NATO allies recognize as part of Morocco, which conquered it in 1975 - than any of the Pentagon's other Unified Combatant Commands: European Command, Central Command, Pacific Command, Southern Command and Northern Command (founded in 2002).

The U.S. is alone in maintaining regional multi-service military commands in all parts of the world, a process initiated after World War Two as America pursued its self-appointed 20th century manifest destiny as history's first worldwide military superpower.

Until October 1, 2008 Africa was overwhelmingly in the European Command's area of responsibility, with all African nations assigned to it except for Egypt, Seychelles and the Horn of Africa states (Djibouti, Eritrea, Ethiopia, Kenya, Somalia and Sudan) overseen by Central Command, and three island nations and a French possession off the continent's eastern coast (Comoros, Madagascar, Mauritius and Reunion) placed under Pacific Command.

The month before AFRICOM began its one-year incubation under U.S. European Command in 2007, Principal Deputy Under Secretary of Defense for Policy
Ryan Henry said, "Rather than three different commanders who have Africa as a third or fourth priority, there will be one commander that has it as a top priority." [2]

The Pentagon official also revealed that Africa Command "would involve one small headquarters plus five 'regional integration teams' scattered around the continent" and that "AFRICOM would work closely with the European Union and NATO," particularly France, a member of both, which was "interested in developing the Africa standby force". [3]

The Defense Department official identified all the key components of Africa Command's role and adumbrated what has transpired in the almost three-year interim: By subsuming nations formerly in the areas of responsibility of three Pentagon commands under a unified one, the U.S. will divide the world's second most populous continent into five military districts, each with a multinational African Standby Force trained by military forces from the United States, NATO and the European Union.

Later the same month, the Pentagon confirmed its earlier disclosure that AFRICOM would deploy regional integration teams "to the northern, eastern, southern, central and western portions of the continent, mirroring the African Union’s five regional economic communities...."

The Defense News website detailed the geographic division described in Defense Department briefing documents issued in that month:

"One team will have responsibility for a northern strip from Mauritania to Libya; another will operate in a block of east African nations - Sudan, Ethiopia, Somalia, Uganda, Kenya, Madagascar and Tanzania; and a third will carry out activities in a large southern block that includes South Africa, Zimbabwe and Angola....

"A fourth team would concentrate on a group of central African countries such as the Democratic Republic of Congo, Chad and Congo [Brazzaville]; the fifth regional team would focus on a western block that would cover Nigeria, Liberia, Sierra Leone, Niger and Western Sahara, according to the briefing documents." [4]

The five areas correspond to Africa's main Regional Economic Communities, starting in the north of the continent:

-Arab Maghreb Union: Algeria, Libya, Mauritania, Morocco and Tunisia.

-East African Community (EAC): Burundi, Kenya, Rwanda, Tanzania and Uganda.

-Economic Community of West African States (ECOWAS): Benin, Burkina Faso, Cape Verde, Cote d'Ivoire, Gambia, Ghana, Guinea-Bissau, Liberia, Mali, Nigeria, Senegal, Sierra Leone and Togo.

-Economic Community of Central African States (ECCAS): Angola, Burundi, Cameroon, Central African Republic, Chad, Republic of Congo (Brazzaville), Democratic Republic of Congo (Kinshasa), Equatorial Guinea, Rwanda and Sao Tome and Principe.

-Southern Africa Development Community: Angola, Botswana, Democratic Republic of Congo, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe.

Africa's far northeast, in and near the Horn of Africa, is in a category of its own, having long been subordinated to the U.S.'s Combined Joint Task Force – Horn of Africa (CJTF-HOA) based in Djibouti where the Pentagon has approximately 2,000 personnel from all four branches of the armed services. The Combined Joint Task Force – Horn of Africa area of operations takes in the African nations of Djibouti, Ethiopia, Eritrea, Kenya, Seychelles, Somalia, Sudan, Tanzania and Uganda as well as Yemen on the Arabian Peninsula. In addition to Seychelles, the CJTF-HOA is expanding its purview to include Comoros, Mauritius and Madagascar in the Indian Ocean.

Three years ago it was reported that the Pentagon had already "agreed on access to air bases and ports in Africa and 'bare-bones' facilities maintained by local security forces in Gabon, Kenya, Mali, Morocco, Namibia, Sao Tome and Principe, Senegal, Tunisia, Uganda and Zambia." [5] That is, in northern, eastern, western, central and southern Africa.

The U.S. has maintained its military base in Djibouti, Camp Lemonnier, since 2003, established a naval surveillance facility in Seychelles last autumn, and has access to base camps and forward sites in Kenya, Ethiopia, Morocco, Mali, Rwanda and other nations throughout the continent.

AFRICOM, as noted above, plans a central headquarters on the continent - its current headquarters remains in Stuttgart, Germany, although Djibouti's Camp Lemonnier functions as a de facto one in Africa - with five regional satellite outposts in northern, southern, eastern, western and central Africa.

The African Standby Force is nominally under the control of the African Union, but its troops are being trained and directed by the U.S., NATO and the military wing of the European Union.

The website of the African Standby Force (ASF) contains links to the following sites:

-ASF Headquarters (Addis Ababa)
-Northern [6]

The African Union's secretariat, the African Union Commission, is based in Addis Ababa, Ethiopia.

Ethiopia is also one of the nations - Liberia and Morocco are others - that has been discussed as a potential site for AFRICOM main headquarters on the continent.

African Standby Force: Trained By U.S. Special Forces, Modeled After NATO Strike Force

Each of the five geographical units listed above is to supply a contingent of up to brigade size (4,000-5,000 troops by NATO standards) for the African Standby Force that is projected to be launched this year.

Two days before U.S. Africa Command was established on October 1, 2007, the American armed forces newspaper Stars and Stripes reported that "The command, scheduled to become operational this week, will focus much of its activity on helping to build the fledgling African Standby Force.

"It is hoped the force, being organized by the Ethiopia-based African Union, or AU, will be ready by 2010. It would consist of five multinational brigades based in the giant continent. Each brigade would perform missions in its given region, such as peacekeeping when the need arose.

"Gen. William E. Ward, nominated to become the first AFRICOM commander, last week told the U.S. Senate in writing that U.S. troops would help the brigades come to life."

Ward, earlier head of NATO's Stabilisation Force (SFOR) in Bosnia in 1996, said in his own words, "AFRICOM will assume sponsorship of ongoing command and control infrastructure development and liaison officer support. It would continue to resource military mentors for peacekeeping training, and develop new approaches to supporting the AU and African Standby Forces.” [7]

This February a NATO website detailed the North Atlantic military bloc's role in complementing AFRICOM efforts to build the African Standby Force:

"NATO began providing support to the AU Mission in May 2005 based on specific requests from the AU. NATO nations supported [the] AU Mission in Sudan (AMIS) by providing airlift for 32,300 personnel....NATO continues to support the AU mission in Somalia (AMISOM) through the provision of strategic sea- and air-lift for AMISOM Troop Contributing Nations on request. The last airlift support occurred in June 2008 when NATO transported a battalion of Burundian peacekeepers to Mogadishu.

"Joint Command Lisbon is the operational lead for NATO/AU engagement, and has a Senior Military Liaison Officer at AU HQ in Addis Ababa, Ethiopia. NATO also supports staff capacity building through the provision of places on NATO training courses to AU staff supporting AMISOM, and support to the operationalisation of the African Standby Force - the African Union's vision for a continental, on-call security apparatus similar to the NATO Response Force." [8]

The NATO Response Force (NRF) completed what was described at the time as its final validation in the two-week, 7,000-troop Steadfast Jaguar military exercises in the African island nation of Cape Verde in 2006.

Africa was the testing ground for the NRF and the NRF is the model for the African Standby Force:

"Since June 2007, NATO has assisted the AU Mission in Somalia (AMISOM) by providing airlift support for AU peacekeepers. This support was authorized until February 2009 and the Alliance is ready to consider any new requests from the AU. NATO also continues to work with the AU in identifying further areas where NATO could support the African Standby Force." [9]

"NATO is also providing, at the AU's request, training opportunities and capacity building support to the African Union's long term peacekeeping capabilities, in particular the African Standby Force." [10]

Since the Berlin Plus agreements between NATO and the European Union in 2002, the military components of both organizations not only overlap and complement each other, but are being integrated at a qualitatively higher level for overseas missions like those in and off the coasts of Africa.

Three years ago French General Henri Bentegeat, then Chairman of the European Union Military Committee, met with EU defense ministers in Germany and an account of his comments included: "The European Union's drive for a stronger global military role includes an upgrading of ties with the United Nations, NATO and the African Union....In addition to last year's military mission in Congo and logistical help for African Union forces in Darfur, Bentegeat said the EU wanted to help an ambitious AU programme to create a standby force for peacekeeping missions." [11]

Even before AFRICOM was activated as a separate military command in the autumn of 2008, U.S. European Command was conducting large-scale multinational military maneuvers in various regions of Africa to train units for the five regional brigades that will form a unified, continental African Standby Force.

Starting in 2006 U.S. European Command (and subsequently Africa Command) has conducted annual Africa Endeavor multinational communications interoperability exercises - frequently in nations on the strategic Gulf of Guinea - with the participation of the armed forces of African, NATO and European Union nations. Africa Endeavor 2007 was held in Ghana and the contributing countries were the U.S., Algeria, Angola, Belgium, Benin, Botswana, Burkina Faso, Burundi, Cameroon, Cape Verde, Chad, Gambia, Lesotho, Mali, Morocco, Namibia, Niger, Nigeria, Senegal, South Africa, Sweden, Uganda and Zambia. It was jointly run by U.S. European Command, U.S. Central Command and the nascent U.S. Africa Command.

"AE [Africa Endeavor] fosters better collaboration in the Global War on Terrorism and supports the deployment of peacekeepers in Sudan and Somalia.

"Furthermore, AE assists in establishing critical communication links to enhance the African Standby Forces’s developments in command, control, communications and information systems (C3IS) and strengthens national, regional, continental and partner relationships...." [12]

Africa Endeavor 2008 was held in Nigeria and included military personnel from 22 African and European nations as well as the U.S.

"During the course of the exercise, participating nations and organizations also continued their efforts to develop standard practices and procedures for the African Union and its African Standby Force." [13]

In 2005 the U.S. launched the first of regular Flintlock multinational military exercises to initiate and expand the Pentagon's Trans-Sahara Counter-Terrorism Initiative (TSCTI), formed in the same year, to train the military forces of Algeria, Chad, Mali, Mauritania, Niger, Senegal, Morocco, Nigeria and Tunisia. Washington's NATO allies Britain, France, Germany, the Netherlands and Spain are also involved in the Trans-Sahara Counter-Terrorism Initiative.

The exercises are run by U.S. Special Operations Command Europe. (In 2007 NATO announced that its Special Operations Coordination Center would be headquartered at the same Kelley barracks on the U.S. base in Stuttgart where AFRICOM headquarters are located.)

An account of the initial 2005 operation divulged that "The U.S. government reportedly plans to spend $500 million over five years to make the Sahara Desert a vast new front in its war on terrorism....During the first phase of the program, dubbed Operation Flintlock, 700 U.S. Special Forces troops and 2,100 soldiers from nine North and West African nations [participated]." [14]

This year's 22-day Flintlock 2010, launched on May 2, includes 600 U.S. special forces and 150 counterparts from Britain, Belgium, France, the Netherlands and Spain.

"The objective of Flintlock 10 is to develop military interoperability....Centered in Ouagadougou, Burkina Faso, but with tactical training conducted in Senegal, Mali, Mauritania and Nigeria, Flintlock 10 will begin 2 May and end 23 May, 2010....Flintlock 10 looks to build upon the successes and lessons learned during previous Flintlock exercises, which were conducted to establish and develop regional relationships and synchronization of efforts among the militaries of the Trans-Saharan region.

"This exercise will take place in the context of the Trans-Sahara Counter Terrorism Partnership (TSCTP). Supported by the U.S. Africa Command (USAFRICOM) and the Special Operations Command (SOCAFRICA), the exercise will provide military training opportunities...." [15]

AFRICOM recently announced that the Special Operations Command Africa "will gain control over Joint Special Operations Task Force-Trans Sahara (JSOTF-TS) and Special Operations Command and Control Element - Horn of Africa (SOCCE-HOA)," [16] to centralize special forces activities in Africa.

Efforts to create the proposed African Standby Force brigade in the north of Africa have floundered for several reasons. Egypt is not member of the Maghreb Union nor is it in AFRICOM's area of responsibility. Libya is one of the most vocal opponents of AFRICOM. There is residual tension between Algeria and Morocco over Western Sahara, which Algeria recognizes as an independent nation. But Algeria, Egypt, Mauritania, Morocco and Tunisia are all members of NATO's Mediterranean Dialogue partnership program.

AFRICOM's plans for regional military intervention contingents are proceeding more favorably in the east, west and south. In June of 2008 the Economic Community of West African States (ECOWAS) conducted a military exercise, Jigui 2008, in Mali with its fifteen member states, and "for the first time, the regional force exercise involved the African Union, the Southern Africa Development Community (SADC), the multinational Standby High Readiness Brigade based in Denmark (SHIRBRIG) and the Ethiopia-based Eastern African Standby Force (EASTBRIG).

"All the exercises were supported by the host governments as well as France, Denmark, Canada, Germany, the Netherlands, the United Kingdom, the United States of America and the European Union.

"Jigui 2008 is consistent with previous training programmes of ECOWAS and is within the framework of the African Union (AU) Standby Force, which seeks to have ready by 2010 one force by each of the Regional Economic Communities (RECs) in Africa.

"The ECOWAS target is to create a 2,770-man Task Force of the 6,500 troops of the regional force which will be available under the control of the AU [African Union]." [17]

A year before Senegal hosted military maneuvers with several other West African nations - Burkina Faso, Gambia, Guinea Bissau, the Republic of Guinea (Conraky) and Mali - to "test the (troops') deployment ability" with military aircraft, vehicles and ships provided by France "ahead of the planned creation of an ECOWAS standby force."

The participating states were trained to "form the western battalion of the 6,500-men intervention force which ECOWAS wants to set up by 2010.

"Army chiefs of ECOWAS member countries agreed in June 2004 to create the permanent 6,500-man force, including the 1,500-strong rapid reaction unit for troubleshooting missions." [18]

Jigui 2009 was held in Burkina Faso with the participation of U.S. Army Africa, the Vicenza, Italy-based Army component of AFRICOM.

Last month ECOWAS held a field training exercise in Benin, Exercise Cohesion Benin 2010, which "aimed to evaluate the operational and logistics readiness of the Eastern Battalion of the ESF, which is part of the overall preparation for the operationalisation of the African Standby Force by December 2010." [19]

In October of last year the Kenyan press reported on Western involvement in building the African Standby Force brigade on the eastern end of Africa:

"Danish, Swedish, Norwegian and Finnish officers will assist the region in the ongoing establishment of a united military force to deal with conflicts on the continent.

"Once functional, the East African Standby Brigade (EASBRIG) will be deployed to trouble spots within 14 days after chaos erupts, to restore order....The brigade will have troops from 14 countries.

"The experts from the European countries...are based at the EASBRIG headquarters, at the Defence Staff College in Karen, Nairobi.

"Vice-Chief of General Staff Julius Karangi said the foreign experts would help fast-track the process of setting up the standby brigade." [20]

EASBRIG consists of troops from Burundi, Comoros, Djibouti, Eritrea, Ethiopia, Kenya, Madagascar, Mauritius, Rwanda, Seychelles, Somalia, Sudan, Tanzania and Uganda, and through the Eastern African Standby Brigade Coordination Mechanism is moving toward the consolidation of the eastern wing of the African Standby Force.

The East African Standby Brigade is to be headquartered in Kenya, and last November a field training exercise was held for it in Djibouti where the U.S. has its main military base in Africa and France has its largest anywhere abroad. A Rwandan news source wrote of it months afterward: "The historical exercise brought together approximately 1,500 troops, police and civilian staff from 10 countries working side-by-side for the first time.” [21]

The most immediate site for the use of the East African Standby Brigade is Somalia, where member states Ethiopia, Rwanda, Burundi, Uganda and Kenya are already involved. EASBRIG will also be available for operations in Sudan, Congo and the Central African Republic as well as against Eritrea. In March of last year AFRICOM chief General William Ward "cited three areas of current conflict on the continent, including border disputes between Eritrea and Djibouti on the Horn of Africa and in North Africa [with] the Western Sahara, and clashing in the Democratic Republic of Congo."

Speaking of the command he heads, Ward added, "the United States was able to lend assistance to Uganda, Rwanda, Congo and to a lesser degree...the Central African Republic." [22]

The European Union, already involved in the first naval operation in its history, European Union Naval Force Somalia – Operation Atalanta, in the Horn of Africa, has deployed a military mission to Uganda to train 2,000 Somali troops to defend the Western-backed Transitional Federal Government in Mogadishu.

Africa Partnership Station: U.S. Warships Patrol African Coasts

In recent years U.S. Naval Forces Europe-Africa has developed the Africa Partnership Station (APS) as a naval component of AFRICOM. Its first deployment took the APS to Equatorial Guinea, Gabon, Ghana, Senegal, Sao Tome and Principe, and Togo, all on the Gulf of Guinea except for Senegal which lies to the north of it.

In the same year, 2007, NATO’s Standing Maritime Group 1, with one warship each from Canada, Denmark, Germany, the Netherlands, Portugal and the U.S., started a circumnavigation of Africa with stops in the Gulf of Guinea and ending with "exercises in the Indian Ocean, off the coast of Somalia...." [23]

At the time Admiral Henry Ulrich, commander of U.S. Naval Forces Europe, said, "The Global Fleet Station concept is 'closely aligned' with the task to be provided by the still-developing U.S. Africa Command," [24] and later announced the departure of the USS Fort McHenry and the High Speed Vessel Swift for a seven-month deployment to the Gulf of Guinea in November of 2007 as part of the Navy’s Global Fleet Station program. The Africa Partnership Station is one of several Global Fleet Stations recently set up by the U.S., others being assigned to the Caribbean Sea and Oceania. "As a dock landing ship, the Fort McHenry is designed to help get U.S. personnel onto 'hostile shores,' according to the Navy." [25]

Phil Greene, director of Strategy and Policy, Resources and Transformation for U.S. Naval Forces Europe, added that the USS Fort McHenry would have a multinational staff, "partnering with nations such as France, the United Kingdom, Spain, Portugal and others who have an interest in developing maritime security in that region." [26]

In fact the USS Fort McHenry first arrived in Spain "to take on passengers from several European partners - Spain, the United Kingdom, Portugal and Germany, among them - before heading to the Gulf of Guinea," where it was joined by the High Speed Vessel Swift to "transport students as well as trainers during visits to Senegal, Liberia, Ghana, Cameroon, Gabon, and Sao Tome and Principe." [27]

In 2007 U.S. warships visited Mozambique for the first time in 33 years and Tanzania for the first time in 40.

As part of Africa Partnership Station port visits last year, the guided-missile destroyer Arleigh Burke traveled to Djibouti, Kenya, Mauritius, Tanzania and South Africa, in the last case holding a week of joint exercises with one of the nation's warships.

In February of 2009 "for the first time the U.S. Navy [had] warships on each side of the African continent as part of Africa Partnership Station’s ongoing teaching mission with African nations." [28] To wit, a frigate in Mozambique, Kenya and Tanzania and an amphibious transport dock in Senegal.

The month before a U.S. frigate became the first Navy warship to anchor off Equatorial Guinea's mainland city of Bata "as part of the Navy’s Africa Partnership Station initiative," after visits to Cape Verde,
Senegal, Benin and Sierra Leone on its way to Tanzania and Kenya.

The U.S. charge d’affaires in Equatorial Guinea was quoted as offering one reason for the visit: "It’s the third largest oil- and gas-producer in sub-Saharan Africa, with a significant foreign investment footprint...." [29]

"The October 2007 initial deployment of the Africa Partnership Station (APS) to the Gulf of Guinea and the coincident rollout of A Cooperative Strategy for 21st Century Seapower signaled a strong American commitment to leveraging U.S. sea power....The APS is a Global Fleet Station (GFS) sea base designed to assist the Gulf of Guinea maritime community in developing better maritime governance....The Global Fleet Station, born out of a need for military shaping and stability a proven concept for this mission in such areas as the Gulf of Guinea and the Caribbean basin." [30]

Currently AFRICOM is leading the Phoenix Express 2010 maritime counter-insurgency exercise in the Mediterranean Sea with Morocco and Senegal among other African nations.

Paralleling NATO's almost nine-year Operation Active Endeavor in the Mediterranean which patrols the northern coast of Africa from the Suez Canal to the Strait of Gibraltar, the U.S. Navy now regularly roams the African coastline from where the Mediterranean meets the Atlantic Ocean down to the strategic oil-rich Gulf of Guinea and all the way south to Cape Town, then north again along the entire Indian Ocean coast to the Red Sea. Africa is encircled by U.S. and NATO warships.

Pentagon Builds Surrogate Armies To Control Africa Region By Region

On the mainland, the Pentagon has transformed the armed forces of Liberia, Rwanda, Uganda and Ethiopia into military surrogates on both ends of the continent. Since 2006 "a U.S. State Department-led initiative...has completely rebuilt the military in Liberia," according to AFRICOM. [31]

Last October the commander of U.S. Army Africa, Major General William B. Garrett III, visited Rwanda (whose military is a U.S. and British proxy) and "stressed that the US army is interested in strengthening its cooperation with the Rwandan Defence Force (RDF)." Garrett confirmed that the U.S. was ready to send more advisers and trainers for the Rwandan army and added, "Likewise, we hope that the Rwandan Defence Forces can also participate in our exercises. So we are hoping to increase the level of cooperation between the US and the Rwandan Defense forces." [32]

Earlier in the year AFRICOM's General Ward also visited Rwanda, where he "met with Rwandan defense leaders and watched displays of Rwandan Defense Force (RDF) capabilities during a two-day visit April 20-21, 2009." [33]

Late last year Ward visited Morocco, a U.S. military partner for several decades, where he had paid two visits the preceding year, and "discussed bilateral military cooperation and opportunities to strengthen
partnership between the Royal Armed Forces and the U.S. Army."

Recently U.S. Marines trained Moroccan troops in Spain ahead of 12-nation naval maneuvers in the Mediterranean Sea.

This April 28 Ward paid his third visit to Botswana, "where he discussed ongoing regional security efforts and potential future military-to-military activities with the BDF [Botswana Defence Force]....The BDF and U.S. military conducted 40 cooperation events together in 2010."

The following day the AFRICOM chief paid his first visit to Namibia where "he met with Namibia's National Defense Force officials to discuss potential future cooperation activities." [34]

On April 27 Brigadier General Silver Kayemba, chief of training and operations for the Ugandan People's Defense Force (UPDF), visited Washington to meet with Major General William B. Garrett III, commander of U.S. Army Africa.

The Ugandan general was quoted saying on the occasion, "This visit strengthens our relationship with the U.S. Armed Forces, particularly with U.S. Army Africa. We are looking forward to even closer cooperation in the future." [35]

Under an Africa Partnership Station program, a 130-troop Security Cooperation Marine Air Ground Task Force has been training military forces in Ghana, Liberia and Senegal. The marine commander in charge, Lieutenant Colonel John Golden, said, "This is the cutting edge of phase zero counterinsurgency," an aspect of "military-to-military training in a very austere environment in areas where there hasn’t been a lot of U.S. military presence in the last 235 years.” [36]

A report by the Stars and Stripes on May 2 disclosed that "At a remote military base in the jungle city of Kisangani, an elite team of U.S. troops is attempting to retrain a battalion of Congolese infantrymen."

The feature laid emphasis on the humanitarian facet of the operation as reports on AFRICOM activities generally do, but also contained these excerpts:

"There are economic and strategic incentives to bringing more security to the Congo, which is rich in natural resources such as cobalt, a key component in the manufacturing of cell phones and other electronics. The country contains 80 percent of the world's cobalt reserves....An April 2009 report to Congress by the National Defense Stockpile Center made clear that ensuring access to mineral markets around the world is of vital interest to national security." [37]

The U.S. is not dragging almost every nation in Africa into its military network because of altruism or concerns for the security of the continent's people. AFRICOM's function is that of every predatory military power: The threat and use of armed violence to gain economic and geopolitical advantages.


1) U.S. Department of Defense, March 18, 2009
2) Agence France-Presse, September 12, 2007
3) Ibid
4) Defense News, September 20, 2007
5) Xinhua News Agency, May 28, 2007
7) Stars and Stripes, September 30, 2007
8) North Atlantic Treaty Organization
Supreme Headquarters Allied Powers Europe
February 24, 2010
9) North Atlantic Treaty Organization, March 11, 2009
10) North Atlantic Treaty Organization, February 18, 2010
11) Deutsche Presse-Agentur, February 28, 2007
12) United States European Command, April 18, 2007
13) United States European Command, July 29, 2008
14) United Press International, December 28, 2005
15) U.S. Africa Command, March 31, 2010
16) U.S. Africa Command, April 30, 2010
17) Ghana News Agency, June 23, 2008
18) Agence France-Presse, November 29, 2007
19) Afrique en ligne, April 19, 2010
20) The Nation, October 29, 2009
21) The New Times, May 4, 2010
22) U.S. Department of Defense, March 18, 2009
23) Business Day (Nigeria), July 25, 2007
24) Stars and Stripes, June 14, 2007
25) Stars and Stripes, October 16, 2007
26) Stars and Stripes, June 14, 2007
27) American Forces Press Service, October 15, 2007
28) Stars and Stripes, February 1, 2009
29) Stars and Stripes, January 20, 2009
30) Afrique en ligne, April 13, 2010
31) U.S. Africa Command, April 29, 2010
32) The New Times, October 20, 2009
33) U.S. Africa Command, April 22, 2009
34) U.S. Africa Command, May 1, 2010
35) U.S. Africa Command, April 30, 2010
36) Marine Corps Times, May 3, 2010
37) Stars and Stripes, May 2, 2010