Saturday, March 5, 2011

People Of Earth: Prepare For Economic Disaster

People Of Earth: Prepare For Economic Disaster

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It is not just the United States that is headed for an economic collapse. The truth is that the entire world is heading for a massive economic meltdown and the people of earth need to be warned about the coming economic disaster that is going to sweep the globe. The current world financial system is based on debt, and there are alarming signs that the gigantic global debt bubble is getting ready to burst. In addition, global prices for the key resources that the major economies of the planet depend on are rising very rapidly. Despite all of our advanced technology, the truth is that human civilization simply cannot function without oil and food. But now the price of oil and the price of food are both increasing dramatically. So how is the current global economy supposed to keep functioning properly if it soon costs much more to ship products between continents? How are the billions of people that are just barely surviving today supposed to feed themselves if the price of food goes up another 30 or 40 percent? For decades, most of the major economies around the globe have been able to take for granted that massive amounts of cheap oil and massive amounts of cheap food will always be there. So what happens when that paradigm changes?

At last check, the price of U.S. crude was over 104 dollars a barrel and the price of Brent crude was over 115 dollars a barrel. Many analysts fear that if the crisis in Libya escalates or if the chaos in the Middle East spreads that we could see the all-time record of 147 dollars a barrel broken by the end of the year. That would be absolutely disastrous for the global economy.

But it isn't just the chaos in the Middle East that is driving oil prices. The truth is that oil prices have been moving upwards for months. The recent revolutions in the Middle East have only accelerated the trend.

Let's just hope that the "day of rage" being called for in Saudi Arabia later this month does not turn into a full-blown revolution like we have seen in other Middle Eastern countries. The Saudis keep a pretty tight grip on their people, but at this point anything is possible. A true revolution in Saudi Arabia would send oil prices into unprecedented territory very quickly.

But even without all of the trouble in the Middle East the world was already heading for an oil crunch. The global demand for oil is rising at a very vigorous pace. For example, last year Chinese demand for oil increased by almost 1 million barrels per day. That is absolutely staggering. The Chinese are now buying more new cars every year than Americans are, and so Chinese demand for oil is only going to continue to increase.

Much could be done to increase the global supply of oil, but so far our politicians and the major oil company executives are sitting on their hands. They seem to like the increasing oil prices.

So for now it looks like oil prices will continue to rise and this is going to result in much higher prices at the gas pump.

Already, ABC News is reporting that regular unleaded gasoline is going for $5.29 a gallon at one gas station in Orlando, Florida.

The U.S. economy in particular is vulnerable to rising oil prices because our entire economic system is designed around cheap gasoline. If the price of gas goes up to 5 or 6 dollars a gallon and it stays there it is going to have a catastrophic effect on the U.S. economy.

Just remember what happened back in 2008. The price of oil hit an all-time high of $147 a barrel and then a few months later the entire financial system had a major meltdown.

Well, as the price of oil rises it is going to create a whole lot of imbalances in the global financial system once again.

This is definitely a situation that we should all be watching.

But it is not just the price of oil that could cause a global economic disaster.

The global price of food could potentially be even more concerning. As you read this, there are about 3 billion people around the globe that live on the equivalent of 2 dollars a day or less. Those people cannot afford for food prices to go up much.

But global food prices are rising. According to the United Nations, the global price of food has risen for 8 consecutive months. Last month, the global price of food set a brand new all-time record high. Many are starting to fear that we could actually be in the early stages of a major global food crisis.

The price of just about every major agricultural commodity has been absolutely soaring during the past year....

*The price of corn has doubled over the last six months.

*The price of wheat has more than doubled over the past year.

*The price of soybeans is up about 50% since last June.

*The price of cotton has more than doubled over the past year.

*The commodity price of orange juice has doubled since 2009.

*The price of sugar is the highest it has been in 30 years.

Unfortunately, the production of food in most countries around the world is very highly dependent on oil, so as oil goes up in price this is going to make the food crisis even worse.

Hold on to your hats folks.

Also, as I have written about previously, the world is facing some very serious problems when it comes to water. Due to the greed of the global elite, there is not nearly enough fresh water to go around. The following are some very disturbing facts about the global water situation....

*Worldwide demand for fresh water tripled during the last century, and is now doubling every 21 years.

*According to USAID, one-third of all humans will face severe or chronic water shortages by the year 2025.

*Of the 60 million people added to the world’s cities every year, the vast majority of them live in impoverished slums and shanty-towns with no sanitation facilities whatsoever.

*It is estimated that 75 percent of India's surface water is now contaminated by human and agricultural waste.

*Not only that, but according to a UN study on sanitation, far more people in India have access to a mobile phone than to a toilet.

*In northern China, the water table is dropping one meter per year due to overpumping.

These days, one of the trendy things to do is to call water "the oil of the 21st century", but unfortunately that is not a completely inaccurate statement. Fresh, clean water is something that we all need, but right now world supplies are getting tight.

Our politicians and the global elite could be doing something about this if they really wanted to, but right now they seem perfectly fine with what is happening.

On top of everything else, the sovereign debt crisis is worse than it has ever been before.

All of the major global central banks have been feverishly printing money in an attempt to "paper over" this crisis, but it is not going to work.

Most Americans don't realize it, but right now the continent of Europe is a financial basket case. Greece and Ireland would have imploded already if they had not been bailed out, and now Portugal is on the verge of collapse. The interest rate on Portugal's 10-year notes has now been above 7% for about 3 weeks, and most analysts believe that it is only a matter of time before they are forced to accept a bailout.

Sadly, if the entire global economy experiences a slowdown because of rising oil prices, we could see half a dozen European nations default on their debts if they are not bailed out.

For now the Germans seem fine with bailing out the weak sisters that are all around them, but that isn't going to last forever.

A day or reckoning is coming for Europe, and when it arrives the reverberations are going to be felt all across the face of the earth. The euro is on very shaky ground already, and whether or not it can survive the coming crisis is an open question.

Of course there are some very serious concerns about Asia as well. The national debt of Japan is now well over 200% of GDP and nobody seems to have a solution for their problems. Up to this point, Japan has been able to borrow massive amounts of money at extremely low interest rates from their own people, but that isn't going to last forever either.

As I have written about so many times before, the biggest debt problem of all is the United States. Barack Obama is projecting that the federal budget deficit for this fiscal year will be a new all-time record 1.65 trillion dollars. It is expected that the total U.S. national debt will surpass the 15 trillion dollar mark by the end of the fiscal year.

Shouldn't we have some sort of celebration when that happens?

15 trillion dollars is quite an achievement.

Most Americans cannot even conceive of a debt that large. If the federal government began right at this moment to repay the U.S. national debt at a rate of one dollar per second, it would take over 440,000 years to pay off the national debt.

But the United States is not alone. The truth is that wherever you look, there is a sea of red ink covering the planet.

The current global financial system is entirely based on debt. If the total amount of debt does not continually expand, the system will crash. If somehow a way was found to keep this system going perpetually (which is impossible), the size of global debt would keep on increasing infinitely.

Now the World Economic Forum says that we need to grow the total amount of debt by another 100 trillion dollars over the next ten years to "support" the anticipated amount of "economic growth" around the world that they expect to see.

The entire global financial system is a gigantic Ponzi scheme. It is designed to keep everyone enslaved to perpetual debt. If at some point the debt spiral gets interrupted in some significant way, we are going to witness an economic disaster that is going to make what happened in 2008 look like a Sunday picnic.

The more research that one does on the current global economic situation, the more clear it becomes that we are absolutely doomed.

So people of earth you had better get ready.

An economic disaster is coming.

Voters deficit-worried but wary of cuts

Voters deficit-worried but wary of cuts

Americans adamantly opposed to cuts in Medicaid, Medicare, Social Security, K-12 education

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As politicians in Washington — and across the country — seek to cut spending to reduce their budget deficits, the latest NBC News/Wall Street Journal poll finds that the American public is divided about how far they should go.

In the poll, eight in 10 respondents say they are concerned about the growing federal deficit and the national debt, but more than 60 percent — including key swing-voter groups — are concerned that major cuts from Congress could impact their lives and their families.

What’s more, while Americans find some budget cuts acceptable, they are adamantly opposed to cuts in Medicaid, Medicare, Social Security and K-12 education.

And although a combined 22 percent of poll-takers name the deficit/government spending as the top issue the federal government should address, 37 percent believe job creation/economic growth is the No. 1 issue.

Republican pollster Bill McInturff, who conducted the survey with Democratic pollster Peter D. Hart, says these results are a “cautionary sign” for a Republican Party pursuing deep budget cuts.

He points out that the Americans who are most concerned about spending cuts are core Republicans and Tea Party supporters, not independents and swing voters.

“It may be hard to understand why a person might jump off a cliff, unless you understand they’re being chased by a tiger,” he said. “That tiger is the Tea Party.”

GOP vs. swing-voter groups
For instance: 33 percent of Tea Party supporters, 34 percent of Republicans and 35 percent of voters backing John McCain in the last presidential election, list deficit/spending as the top issue the federal government should address — compared with 23 percent of independents, 24 percent of suburban women, 19 percent of seniors and 19 percent of those aged 18 to 34.

By contrast, 35 percent of seniors, 39 percent of 18- to 34-year-olds, 40 percent of independents and 41 percent of suburban women believe job creation/economic growth is the nation's top issue.

And two-thirds of independents, seniors, 18- to 34-year-olds and suburban women say they are concerned that major cuts to government spending could impact them and their families. Roughly half of Republicans, McCain voters and Tea Party supporters express the same concern.

In the spending showdown between congressional Democrats and Republicans, only 25 percent believe the disagreement over the budget will lead to a shutdown of the federal government. A whopping 71 percent believe that lawmakers will reach an agreement to avert a shutdown.

  1. Other political news of note
    1. AP
      White House agrees to $6.5 billion more in cuts

      The White House says it is willing to agree to more than $6 billion in spending cuts in order to keep the government operating through Sept. 30 and avoid a shutdown.

    2. First Thoughts: Still waiting
    3. Boehner, GOP take step to defend DOMA
    4. Unions wary of Dems' convention plans in NC
    5. Government employment declines, but long-term growth is clear
Read the full poll results here (.pdf)

Indeed, The Senate on Wednesday cleared legislation — which the House passed the day before — to extend government funding until March 18. The measure, which President Barack Obama signed into law Wednesday afternoon, included $4 billion in budget cuts, but the stopgap bill tees up another potential impasse in two weeks.

Whom will the public blame if there is a shutdown after March 18 or beyond? In the poll, 21 percent said Obama and the congressional Democrats would be responsible for a shutdown, while another 21 percent said congressional Republicans should take the blame. Fifty-seven percent said they would blame both sides equally.

Popular and unpopular cuts
The survey — which was conducted Feb. 24-28 of 1,000 adults (200 reached by cell phone), and which has an overall margin of error of plus-minus 3.1 percentage points — also listed 26 different ways to reduce the federal budget deficit.

The most popular: placing a surtax on federal income taxes for those who make more than $1 million per year (81 percent said that was acceptable), eliminating spending on earmarks (78 percent), eliminating funding for weapons systems the Defense Department says aren’t necessary (76 percent) and eliminating tax credits for the oil and gas industries (74 percent).

The least popular: cutting funding for Medicaid, the federal government health-care program for the poor (32 percent said that was acceptable); cutting funding for Medicare, the federal government health-care program for seniors (23 percent); cutting funding for K-12 education (22 percent); and cutting funding for Social Security (22 percent).

Those numbers, GOP pollster McInturff says, “serve as a huge flashing yellow sign to Republicans … if they are going to start to talk about changes to Medicare and Social Security.”

On Wisconsin and state battles
Turning to the budget battles taking place in the states, strong majorities say they are comfortable with states requiring their employees to pay more for their retirement and health care to balance budget deficits. But they oppose stripping public employees' collective-bargaining rights, as Republican Gov. Scott Walker is proposing in Wisconsin.

Video: Rating Obama’s opponents (on this page)

In the poll, 68 percent find it acceptable to require public employees to contribute more of their pay for retirement benefits; 63 percent are fine with requiring these employees to pay more for their health-care benefits; and 58 percent would be amenable to freezing public employees' salaries for one year.

However, just 33 percent say it's acceptable — and 62 percent say it's unacceptable — to eliminate some employees’ collective-bargaining rights as way to deal with state budget deficits.

In addition, 77 percent believe public employees should have the same collective-bargaining rights (when it comes to health care, pensions and other benefits) as union employees who work for private companies.

On Obama and 2012
President Obama’s job-approval rating in the poll sits at 48 percent, which is down five points since last month. “If you leave out [the Tucson shootings], the president’s job rating is where it was for most of 2010 — not terrible, not great,” said Hart, the Democratic pollster.

Against some notable Republicans in a hypothetical general-election presidential contest, Obama leads former Massachusetts Gov. Mitt Romney 49 percent to 40 percent and former Minnesota Gov. Tim Pawlenty 50 percent to 31 percent.

But against a generic Republican, the president’s lead narrows to five points, with 45 percent saying they will “probably vote” for Obama and 40 percent saying they will “probably vote” for the GOP candidate.

In a hypothetical Republican presidential primary, former Arkansas Gov. Mike Huckabee leads the pack as the first choice of 25 percent of GOP primary voters — followed by Romney at 21 percent, former House Speaker Newt Gingrich at 13 percent and former Alaska Gov. Sarah Palin at 12 percent.

Texas Congressman Ron Paul comes in fifth at 6 percent — followed by Pawlenty and Indiana Gov. Mitch Daniels at 3 percent, former Sen. Rick Santorum at 2 percent and Jon Huntsman, current U.S. ambassador to China, at 1 percent.

Mississippi Gov. Haley Barbour was the first choice of just one respondent out of the 282 GOP primary voters surveyed.

The “new normal”
Obama’s biggest weakness heading into 2012? It’s what Hart calls the “new normal.”

For instance, just 31 percent believe the nation is headed in the right direction. “We’re now at 20 months [in the NBC/WSJ poll] where we have not been able to break 40 percent [in the] right direction,” Hart said. “Essentially, this country has been in a long swoon.”

What’s more, only 29 percent of those surveyed think the economy will improve in the next 12 months. That’s down 11 points from January.

“This is a country that refuses to feel better,” said McInturff.

And that, Hart added, shapes a 2012 election cycle that could be “very, very close with a lot of challenges left ahead for the president.”

Golden Years?

Golden Years?

The problem isn’t that public-sector workers have too much retirement security. It’s that everyone else has too little.

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One big reason public employees are under siege in Wisconsin and other states is because they now enjoy more secure retirement benefits than most private-sector workers. The question is whether the right way to close that gap is by reducing security for government employees or increasing it for everyone else.

For private-sector workers, retirement security is unmistakably eroding. The change is rooted in the shift from “defined benefit” pensions, under which employers guarantee their workers a fixed payment after retirement, to “defined contribution” pensions, such as 401(k) plans, under which employers commit only to contributing a fixed amount that employees must invest on their own.

In 1985, about four in five workers at medium- and large-sized private firms received a defined-benefit pension, according to federal statistics. Today, less than one-third are covered under such plans. Instead, most workers at large and medium private companies who receive pension benefits at all obtain them in the form of defined contributions. In small companies, defined-benefit plans are virtually extinct—and only about one-third of those workers receive even a defined-contribution retirement benefit.

This replacement of traditional pensions with 401(k)-type plans amounts to a massive shift of risk from employers to individuals. Under defined-benefit programs, employers bear the primary financial risk: They are obligated to provide the benefits regardless of how their investments perform. Under defined-contribution programs, workers invest their own money and suffer if the markets tank, as anyone with a 401(k) discovered in the 2008 meltdown.

But one group of workers has largely avoided this shifting of risk: public employees. Defined-benefit plans still cover fully 87 percent of public employees (compared with the one-third of private-sector workers at larger companies). In fact, the share of public-sector workers with traditional pensions now substantially exceeds the two-thirds of private-sector workers at bigger companies with access to either a defined-benefit or defined-contribution plan.

That advantage creates understandable resentment among workers who have lost such certainty. “The taxpayer who is hurting does not have a defined-benefit pension and is saying, ‘Why should my taxes go up so this other group can have this very generous retirement?’ ” says John Rother, executive vice president of policy at AARP, the giant seniors’ lobby.

Most Americans will need to contribute by working somewhat longer.

Some of the pension benefits that public employees have negotiated are indefensible (particularly those allowing excessively early retirement). And over time, it’s unsustainable for public employees to enjoy so much more retirement security than most of the taxpayers who fund their benefits. But the escalating conflict over whether public employees have won too much retirement security is obscuring the larger issue of whether everyone else has lost too much. “The question is, should we bring everyone down to what we’ve done in the private sector where the level of insecurity is [rising]?” says Alicia Munnell, director of the Center for Retirement Research at Boston College.

Using conservative assumptions, and including all potential sources of income (including Social Security, traditional pensions, home equity, and 401(k) plans), the Center for Retirement Research calculates that fully half of Americans will fail to generate enough postretirement income to approach their preretirement standard of living. The vulnerability is greater for younger than older baby boomers and greater still for Generation X. Those who rely on defined-contribution plans are substantially more exposed than the dwindling number with access to traditional pensions. The overall level of risk, Munnell warns, “is shockingly high.”

The 401(k) has several virtues: flexibility, portability, autonomy. For the vast majority of workers, however, it is not producing enough assets for a secure retirement—either because they didn’t invest enough, made bad investment choices, or simply suffered from market volatility. In all, workers who retire during the next 20 years can expect to replace only about two-thirds of their preretirement income, compared with about four-fifths for their parents’ generation, the liberal-leaning think-tank Demos calculated in a recent study. “It’s a tougher future than we’re expecting; it’s a tougher future than our parents had; and I think it’s going to be demoralizing,” Munnell says.

Public employees need to accept reasonable concessions as states confront big budget deficits. But the impulse to take government workers down a peg might be better channeled toward increasing retirement security for everyone else in fiscally responsible ways.

Most Americans will need to contribute by working somewhat longer. Beyond that, one option is to provide bigger Social Security benefits for lower-income retirees by restraining them for the affluent. Another, as President Obama has proposed, is to establish automatic retirement-savings accounts for workers without pension plans, with matching federal contributions for lower-income savers. These contributions could be funded by limiting the tax break for 401(k) plans, because those deductions most benefit the wealthy (and are projected to cost $360 billion in lost federal revenue through 2015).

Public pensions may be attracting the headlines, but the unraveling of private-sector pension security poses a much greater long-term challenge, even if it lacks a pyrotechnic confrontation to galvanize the media.

Oil price shock; you ain't seen nothing yet

Oil price shock; you ain't seen nothing yet

Oil derricks operating in Hebei province, northeast China (Photo: EPA)

Oil derricks operating in Hebei province, northeast China (Photo: EPA)

The most common cause of a spiking oil price is supply shock. We may be seeing just such a phenonenon right now with the effective shut down of Libyan oil. But sometimes it’s excessive demand that does the damage.

Forget the present turbulence, which may or may not be temporary. You don’t have to look far into the future, perhaps as little as a year to 18 months, to see that a major demand challenge is looming which even assuming no further disruption to existing production, will challenge the present supply base to breaking point.

As it is, it’s fair to assume the world is closer to full capacity than producers care to admit. Rewind to the last oil price shock in the summer of 2008, and Saudi Arabia, pumping out oil at the rate of around 9.5 million barrels a day, was having to draw on inventories to meet demand. It’s therefore reasonable to assume that 9.5 million bpd then represented maximum capacity.

Since then, the Saudis have brought a further two fields on stream with a capacity of around 2 million bpd, bringing total capacity up to some 11.5 million bpd. But there is generally reckoned to be an attrition rate of around 6pc per annum on existing fields, taking us back to square one in terms of maximum daily output. This is perilously close to what the Saudis are already producing, and makes the assumed buffer of Saudi spare capacity considerably smaller than the Saudis claim. There’s not much slack anywhere else either.

Now look at growth in demand, virtually all of which is coming from China and other emerging markets. Chinese demand at around 10 million bpd annually is already around half that of the world’s biggest oil consumer, the US. But unlike the US, where demand is in gentle decline, in China it’s rising like a rocket. Last year Chinese demand rose by close to 1 million bpd. It’ll probably be a bit lower this year, but not much. More cars are now being bought in China than the US, and they’ve got to run on something.

Nobody believes that Chinese GDP will grow by as little as 3 per cent per annum over the five years, but in order for as much nominal GDP to to be added to the Chinese economy over the next five years as occurred in the last five, that’s in fact all that needs to occur. In reality, growth is likely to be much higher.

Do the math. Almost regardless of what happens to supply, demand will soon be outpacing the world’s capacity to meet it. The economic effect of such a mismatch is to drive up prices to a level where they eventually ration demand. Output will fall to a point which brings demand back into balance with supply. That’s called a recession.

That may be where we are heading this time. Or it may be that the world economy can tolerate rather higher oil prices than it has in the past. We’ll see. But either way, high prices serve an important purpose. One is to stimulate investment in further sources of supply. And as Chris Huhne, the UK Energy and Climate Change Secretary, pointed out in a speech this week, another is to make alternative energy sources economic. By Mr Huhne’s estimation, $100m oil is the point at which clean and green energy become cheaper for the UK consumer than hydrocarbons.

The UK is only 2 per of global demand for oil, so what happens here isn’t going to make a whole lot of difference to the overall picture. But what the US chooses, or is forced to do, most certainly will. Per capita consumption of oil in the US is about twice the European level. The solution to the looming demand problem for oil is therefore to get the US to reform its bad behaviour and consume less of the stuff. This is much easier said than done.

The whole US economy is built around cheap oil, and there is certainly an argument for saying the US cannot physically consume less without taking a big hit to GDP. On the other hand it also means that there is huge scope for efficiency improvements. Relatively small changes in behaviour which need not necessarily be damaging to output – such as automobile sharing or simply using public transport more frequently – could have a big effect on consumption.

In any event, high oil prices are here to stay. In 2008, the price at which US consumers stopped spending was $147 a barrel. It may be a bit higher this time around, but it’s not going to be far off.

U.S. And NATO Escalate World's Deadliest War On Both Sides Of Afghan-Pakistani Border toxing

U.S. And NATO Escalate World’s Deadliest War On Both Sides Of Afghan-Pakistani Border

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The United States and its military allies in the North Atlantic Treaty Organization have entered the third month of war in Afghanistan this year, which President Barack Obama in December of 2009 announced as the year in which American and other foreign occupation forces would be reduced preparatory to their full withdrawal.

Within months of the U.S. head of state’s claim, the commander-in-chief had over 90,000 troops in the conquered country and currently there are 60,000 more from some fifty other nations serving in NATO’s International Security Assistance Force (ISAF). The total number exceeds that of any foreign military force ever before stationed in Afghanistan. The presence of American and allied troops, beginning as it did on October 7, 2001, is the longest in the Asian nation’s history, with U.S. forces already in the country for several months longer than Soviet troops were stationed there from late 1979 until early 1989.

Since Obama’s pledge that U.S. and NATO troop strength would be reduced this year – not a firm deadline but an evasion, a self-serving lie designed to take the sting out of the announcement of increased troop deployments, one the international community, self-styled and genuine, chose to take at face value – the world’s only ongoing war of occupation has stretched into not only the longest armed conflict in Afghanistan’s history but also in that of the U.S.

In the same interim several new force contributors like Armenia, Bahrain, Colombia, Egypt, Japan, Kazakhstan, Malaysia, Montenegro, Mongolia, South Korea (which had withdrawn an earlier contingent in 2007) and Tonga were recruited to provide troops to serve under NATO’s Afghan command, to which the overwhelming majority of American troops are now also assigned, and to be initiated into 21st century warfare under the control of the West.

Last year marked the largest amount of U.S. and ISAF deaths in the war that is now in its eleventh calendar year, as well as the most Afghan government troop and police fatalities, the highest number of reported insurgent deaths and the most civilians slain in the nearly decade-long war. 712 foreign soldiers and almost 10,000 Afghans were killed in 2010.

To the east of Afghanistan, unmanned aerial vehicle (drone) missile attacks conducted by the U.S. Central Intelligence Agency killed in the neighborhood of 1,000 people in Pakistan last year, the most in any year since the cowardly targeted assassinations and concomitant civilian “collateral damage” were begun in 2004 and almost half of the total dead for the entire period.

As last year wound down, bombing, strafing and other air attacks launched by the U.S. and NATO increased in intensity, with October registering the highest monthly number of air combat missions, over 1,000, of the war to date.

The Pentagon has ordered a record quantity of Predator, Reaper and other death-dealing drones for this year, beyond to the new “drawdown” date – 2014 – and for as far afterward as it chooses to continue and further escalate the war on both sides of the Afghan-Pakistani border.

On that score, the infinite plasticity of a final withdrawal date, U.S. Marine General James Mattis, the head of U.S. Central Command, stated last month that he was “militarily uncomfortable” with the 2014 deadline, [1] and Senator Joseph Lieberman said “it was unwise to set the beginning of any exit date.” [2]

In addition to unprecedented foreign troop numbers, air attacks and drone operations, head of U.S. Special Operations Command Admiral Eric Olson recently said of special forces operations, increasingly the ground combat emphasis for America’s counterinsurgency war in South Asia, that the demand for special operations forces in Afghanistan is “insatiable,” and:

“As we have essentially doubled our force over the last nine years [and] tripled our budget over the last nine years, we have quadrupled our overseas deployments over the last nine years.” [3]

U.S.-selected and -protected Afghan President Hamid Karzai announced last month that Washington intends to establish permanent military bases in his nation – a development that was evident to many almost a decade ago – and “The bases would enable US troops to remain in the area beyond the planned transfer of security responsibility from US and NATO troops to Afghan forces by end of 2014….” [4]

The military installations to be retained, added and expanded would include the Bagram, Kandahar and Shindand air bases in the north, south and west of the nation from which the Pentagon could conduct surveillance and combat operations not only in Afghanistan but throughout the region.

Afghans are not to be spared another decade – or generation or more – of Western military occupation and attacks of the sort that occurred on February 17 in the eastern province of Kunar.

A week after the event, an Afghan government investigation determined that NATO air strikes targeted civilians in a village in the province, killing over five dozen people including 50 women and children, among them 19 females from seven months to 18 years of age. 21 teenage boys and 15 elderly men were also slain. [5]

The head of the government delegation appointed to conduct the probe stated:

“After four days of discussions and interviews with tribal leaders, security officials and other civilians, we found that 65 civilians were killed by NATO missiles in the Ghazi Abad district of Kunar province.” [6]

In the week between the slaughter and the release of the report documenting its details, a NATO attack in the province of Nangarhar “hit a house, killing a couple and their four children,” according to a spokesman for the province’s governor. [7]

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During the same period the U.S. was occupied in killing people on the Pakistani side of the border. Drone missile attacks were launched near Miranshah, the administrative headquarters of North Waziristan in the Federally Administered Tribal Areas. A local security official told the news media that “three missiles were fired at a residential compound in Dattakhel Mohammedkhel,” resulting in five people being killed in an “attack which completely demolished [their] house.”

The same source added, “the identity of those killed could not be ascertained.”

Another local official described what has become the typical modus operandi of the murderous CIA missile strikes when he detailed that “two people were killed when a missile strike from another drone hit a vehicle proceeding towards the house that was targeted earlier.” [8]

The day before, February 20, the U.S. also attacked a village in South Waziristan, killing six people and wounding several others.

According to a Pakistani news source which placed the death toll for the other attack at eight, “The two attacks by the US drones in the Pakistani tribal areas were the first ones after the arrest of CIA spy Raymond Davis for killing two Pakistanis in Lahore.” [9]

Regarding the strike in South Waziristan, it was reported that the “identity of the slain people could not be ascertained, but local tribesmen claimed all of them were tribal people.”

And in reference to the attacks in North Waziristan:

“Villagers and official sources said 10 US spy planes were seen hovering over various villages in Mir Ali and Miramshah throughout the day on Monday [February 21]. According to villagers in Mir Ali, the drones fired four missiles and hit two rooms and a car parked inside [a] mud house.

“The villagers claimed all the victims were local tribespeople and had no affiliation with militants. They said the injured people were rushed to a nearby hospital in the town of Mir Ali, where doctors said the condition of some of them was critical. The tribesmen who pulled out bodies from the debris of the house said the bodies of the majority of the slain people were mutilated beyond recognition.”

According to a local tribesman, “The Americans don’t care for others and they will continue killing us.” [10]

American and NATO war deaths in Afghanistan are at 71 so far this year, before the spring fighting season has begun, but Afghan and Pakistani civilian deaths exceed those of Western belligerents.

Earlier last month NATO and Afghan government forces shelled a Pakistani military post in North Waziristan, killing a soldier and wounding seven more.

A local news source said some of the injured were in critical condition and that “Pakistani forces returned the fire with artillery and rocket launchers and targeted the Nato and Afghan forces’ positions across the border.”

“Soon after the shelling, Nato helicopters intruded into Pakistan airspace and kept flying for some time over the area….Some reports said Nato jet fighters also violated the Pakistani airspace in the border area….Later in the evening, five mortar shells fired by Nato forces landed in the Saidgi locality in Ghulam Khan Tehsil.” [11]

Two days later, February 4, NATO renewed the bombardment and “Shelling from across the Durand Line continued unabated as 22 more mortar shells fired by Nato and Afghan forces from Afghanistan’s territory fell in North Waziristan,” with shells landing in populated areas of the agency. [12]

The deadly attack by NATO against Pakistani military targets was not the first such incident and will not be the last. On September 30 of 2010 NATO helicopter gunships attacked a security post in the Upper Kurram Agency in the Federally Administered Tribal Areas, killing three Pakistani soldiers and reducing the fort to rubble in the third violation of the nation’s airspace in a week.

Two fixed-wing NATO aircraft accompanied the helicopters, which launched two attacks over four hours apart. “According to local people, the dead and injured had suffered severe burn injuries.”

In a strike in the same agency three days before, “Nato claimed killing six insurgents and injuring eight others while local people contradicted the claim and said those killed were Muqbal tribesmen.” [13]

The following month NATO aircraft penetrated the province of Balochistan when “NATO warplanes and helicopter gunships entered up to 15 kilometers inside Pakistani airspace.” [14]

By November NATO attack helicopters had, in addition to conducting strikes in the tribal belt, “violated Pakistani airspace, defying the integrity and sovereignty of Pakistan, over half a dozen times in…northwest Khyber Pakhtunkhwa and southwest Balochistan provinces….” [15]

Not only has the U.S. killed over 2,000 people with drone missile strikes in North and South Waziristan, but over the last five months NATO has slain several Pakistani military personnel, extending the war into a nation with a population of 170 million and nuclear weapons.

While most of the world’s attention is concentrated on events in North Africa, the West is steadily and inexorably intensifying the longest, largest and most lethal war on the planet.


1) Reuters, February 2, 2011
2) New York Times, February 6, 2011
3) U.S. Department of Defense, February 8, 2011
4) Deutsche Presse-Agentur, February 8, 2011
5) Deutsche Presse-Agentur, February 27, 2011
6) Ibid
7) Deutsche Presse-Agentur, February 21, 2011
8) RTT News, February 24, 2011
9) The News International, February 22, 2011
10) Ibid
11) The News International, February 3, 2011
12) The News International, February 6, 2011
13) DawnNews, October 6, 2010
14) Asian News International, October 19, 2010
15) Xinhua News Agency, November 28, 2010

You Call This An Economic Recovery? 44 Million Americans On Food Stamps and 10 Other Reasons Why The Economy Is Simply Not Getting Better

You Call This An Economic Recovery? 44 Million Americans On Food Stamps and 10 Other Reasons Why The Economy Is Simply Not Getting Better

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When Barack Obama, the Federal Reserve and the mainstream media tell us that we are in the middle of an economic recovery, is that supposed to be some kind of sick joke? According to newly released numbers, over 44 million Americans are now on food stamps. That is a new all-time record and that number is 13.1% higher than it was just one year ago. So how many Americans have to go on food stamps before we can all finally agree that the U.S. economy is dying? 50 million? 60 million? All of us? The food stamp program is the modern equivalent of the old bread lines. More than one out of every seven Americans now depends on the federal government for food. Oh, but haven't you heard? The economy is showing dramatic improvement. Corporate profits are up. The stock market is soaring. Happy days are here again.

It just seems inconceivable that anyone can claim that the economy is improving when the number of Americans on food stamps continues to set a brand new record every single month. But the food stamp program is not the only indicator that the economy is still having massive problems. The following are 10 more reasons why the U.S. economy is simply not getting any better....

#1 Some recent statistics actually indicate that the number of unemployed Americans is still going up. According to Gallup, unemployment in the United States rose to 10.3% at the end of February. That is the highest number Gallup has reported since early last year.

#2 The housing industry is still a complete and total disaster. In fact, new home sales in the U.S. in January were 11.2% lower than they were in December. Not only that, the number of new home sales in January was 18.6% lower than the number of new home sales in January 2010. That is not a sign of improvement.

#3 There wouldn't even be much of a housing industry at all at this point if it was not for the U.S. government. Right now the U.S. government is either writing or guaranteeing well over 90 percent of all mortgages in the United States. So what would the housing market look like in 2011 if the government was not in the picture?

#4 In 2010, more than a million U.S. families lost their homes to foreclosure for the first time ever, and that number is expected to go even higher in 2011.

#5 Due to rampant economic decay and record numbers of foreclosures there are areas in most of our major cities that now look like "war zones". For example, the Huffington Post is reporting that there are now approximately 15,000 vacant buildings in the city of Chicago and there are approximately 60,000 vacant houses and apartments in the city of Las Vegas.

#6 According to the Oil Price Information Service, U.S. drivers spent an average of $347 on gasoline during the month of February, which was 30 percent more than a year earlier. This represented 8.5% of median monthly income. So what is going to happen when gas prices go even higher? Sadly, the average price of gasoline in the U.S. has risen another 4 cents since yesterday and it is likely to go much higher from here.

#7 The U.S. trade deficit continues to grow. The trade deficit was about 33 percent larger in 2010 than it was in 2009, and the 2011 trade deficit is expected to be even bigger.

#8 The CredAbility Consumer Distress Index, which measures the average financial condition of U.S. households, declined in every single quarter in 2010.

#9 The number of Americans that have become so discouraged that they have given up searching for work completely now stands at an all-time high.

#10 The U.S. national debt is growing faster than ever. The Obama administration is projecting that the federal budget deficit for this fiscal year will be a new all-time record 1.65 trillion dollars. It is hard to even imagine how much money that is. If you went out today and started spending one dollar every single second, it would take you over 31,000 years to spend one trillion dollars. Long ago the U.S. government should have been getting these deficits under control, but instead they are just getting even larger.

So in light of the statistics above, can anyone really claim that we are in the middle of an economic recovery?

The truth is that there is no sign that any of the long-term trends that are destroying the U.S. economy are even slowing down.

Millions of jobs continue to be shipped overseas.

The U.S. dollar continues to be devalued.

The federal government continues to go into more debt.

State and local governments continue to go into more debt.

Our trade deficit continues to grow.

Our cities continue to be transformed into wastelands as they are being systematically deindustrialized.

The number of Americans that are dependent on the government continues to soar.

The U.S. middle class continues to shrink.

I know that I harp on these themes over and over, but it is vitally important that everyone understands that the mainstream media is lying to us.

The U.S. economy is dying a very painful death and there is no hope on the horizon.

Things are not going to be getting better. Well, they may get a bit better for the boys down on Wall Street, but for the rest of us our standards of living are going to continue to decline.

The best days for the U.S. economy are already behind us. What lies ahead is a whole lot of pain.

We are going to pay the price for decades of corruption and incompetence.

An economic collapse is coming and you had better get ready.

Most Republicans and Democrats Agree: Cut Aid for Poor People, Not Israel

Most Republicans and Democrats Agree: Cut Aid for Poor People, Not Israel

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With the U.S. economy in the tank and governments at all levels facing massive budget shortfalls, politicians left and right are seeking ways to curb spending. Wisconsin Gov. Scott Walker wants to eliminate collective bargaining rights and the decent pay that goes with them. President Barack Obama's budget includes halving the home-heating oil subsidy poor households depend on.

As Republicans and Democrats propose cuts in programs that actually benefit their increasingly impoverished constituents, though, they agree there's one area of the budget that's not to be touched: the annual $3 billion subsidy U.S. taxpayers provide to the Israeli military.

One of the biggest defenders of the handout is House Foreign Affairs Committee Chairwoman Ileana Ros-Lehtinen. "There will be no cuts to security assistance to the Jewish State of Israel," her chief of staff declared in a recent letter to House Republicans. The rest of the U.S. foreign aid budget, including assistance for Iraqi refugees and food aid to the world's poorest people, is fair game. But Florida congresswoman insists we must help Israel maintain its "Qualitative Military Edge."

And congressional Democrats have her back.

Illinois Democrat Jan Schakowsky, for instance - a leading member of the Congressional Progressive Caucus - has drafted a letter, cosigned by California Democrat Anna Eshoo, warning that the revolutions in Egypt and Tunisia "have the potential to add to the very real security challenges faced by Israel." Reducing or "otherwise endangering aid to our ally" would be "unproductive," she adds, encouraging her colleagues to tell Obama they "strongly support providing $3.075 billion in assistance to Israel." (For those shivering at home, that's more assistance than Obama is proposing to offer Americans trying to keep their houses warm.)

This liberal appeal for Israeli military aid, meanwhile, is being sent out under the auspices of J Street, a group that positions itself as a left-leaning answer to AIPAC. But J Street staff we spoke with at their recent conference were hard-pressed to explain why U.S. taxpayers should fund a right-wing Israeli government that continues to build settlements and maintains an inhumane siege of Gaza.

So it's left to folks like libertarian Congressman Ron Paul and his son, Kentucky Senator and Tea Party favorite Rand Paul, to call for ending aid to Israel. In a February 4 interview with ABC News, Rand Paul said of Israel, "I think that their per capita income is greater than probably three-fourths of the rest of the world. Should we be giving free money or welfare to a wealthy nation? I don't think so."

Indeed, Israel has the 24th largest economy in the world, and ranks 15thamong 169 nations on the UN Human Development Index, which makes it a "very highly developed" nation.

Yet what thanks did Senator Paul get for his call to save the U.S. taxpayers billions of dollars? A torrent of criticism, even from J Street, which called on Republicans - and their donors - "to repudiate his comments and ensure American leadership around the world is not threatened by this irresponsible proposal."

Paul's fellowTea Partiers aren't any better. Of the 87 freshmen House Republicans elected on platforms of cut-baby-cut, at least three-fourths have now signed a letter declaring that, "As Israel faces threats from escalating instability in Egypt" - where have we heard that line of argument before? - "security assistance to Israel has never been more important." Subsidies are for militaries, you see, not poor people.

But even without U.S. funding, Israel would still spend $11 billion-plus on its military, more than all but 20 other nations in the world spend on their armed forced - and hundreds of millions of dollars more than the Islamic Republic of Iran, despite having just 1/10ththe population. Throw in a couple - as in, couple hundred - little things called nuclear weapons, and, for better or worse, the Jewish state's "Qualitative Military Advantage" isn't going anywhere.

But you wouldn't know that listening to the folks at J Street or to liberals like Jan Schakowsky, who hysterically cite the specter of Arab democracy to advocate billions in subsidies for a government that openly flouts international law. So much for their concern about human rights. And so much for being progressive. Indeed, with liberals like these, the Netanyahu government and its allies at AIPAC are likely asking themselves: who needs the Tea Party?

Support Government Worker's Battle, or We Will All Suffer the Economic Consequences

Support Government Worker's Battle, or We Will All Suffer the Economic Consequences

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Emboldened by November’s election results, corporations and their right-wing allies have launched what they hope will be their final offensive against America’s unions. Their immediate target is government workers’ unions. While New Jersey’s Republican Governor Chris Christie has gained national fame by beating up on public school teachers, the threat to unionized workers is playing out in all fifty states, to the drumbeat in the media about states going broke because of government workers’ wages, pensions and benefits. By late January, with the swearing-in ceremonies complete in the twenty-one states where Republicans have a “trifecta,” controlling the governor’s office and both statehouses, hundreds of bills had been introduced seeking to hem in unions if not ban them altogether. On February 11, Wisconsin’s new Republican Governor Scott Walker made what amounts to a declaration of all-out war on public sector workers in his historically progressive state, moving to deprive them of the very right to bargain collectively on matters essential to their economic security.

Walker’s gambit has rightly elicited outrage, but considering the breadth of the attack unions are facing nationally, it is only the tip of the iceberg. Right-to-work legislation has been filed in twelve states; this is in addition to the twenty-two that already have such laws on the books. In technical terms, this legislation makes it illegal for employers to condition employment on union membership or the equivalent dues payments even when a majority of workers vote to form a union; practically speaking, it makes building and maintaining a strong union very difficult, which in turn makes it harder to organize new workplaces because there are few positive examples of unions to point to. In Virginia, the corporations and right-wing ideologues decided that the existing right-to-work law wasn’t sufficient, and introduced a measure to embed the right-to-work provisions in the state Constitution. Three more states—Montana, Ohio and Wisconsin—are expected to have bills introduced converting their legal status to right-to-work.

Alabama passed legislation in January that bans public employee unions from collecting dues unless the unions first prove that none of the money will be used for supporting election campaigns. In every subsequent year after the initial certification, the union must submit itemized reports accounting for how its money is being spent. This law, sold as “paycheck protection” by the right but known as “paycheck deception” among union activists, has been introduced in four other states this year, including Arizona, Kansas, Mississippi and Missouri. In California there has already been ballot initiative language submitted to do the same. Using a variety of legal tools, these measures prohibit the use of union dues for political activity. Union advocates are expecting twelve more states to file bills or initiatives banning the collection of union monies for politics.

As long as the labor movement (what is left of a labor movement) continues to support "Democrats" who stab them in the back, the future for the labor movement is nonexistent. And since the Democratic Party can not exist without union financial support, the Party itself, under Obama and the phonies, is committing suicide.

Building and construction unions are facing their own daunting lineup of bills that would gut prevailing wage laws and what are known as Project Labor Agreements (PLAs). These measures facilitate collective bargaining and the division of labor for unionized construction jobs, particularly construction jobs with public financing. In twenty states there is legislation expected to ban PLAs. In Iowa the new governor, Terry Branstad, was so excited to take up the challenge, he undid PLAs with his first executive order. The new governor of Ohio, John Kasich, has pledged to eliminate prevailing wage laws. It’s hard to say whether Missouri or Maine will beat him to his goal, though: Missouri’s legislation to ban prevailing wages has been introduced, and the new governor of Maine appointed the head of the building and construction industry organization to the position of state legislative director, a sure sign that he’s serious about eliminating such laws. The AFL-CIO says it anticipates anti–prevailing wage laws in fifteen states.

It is government workers, however, who face attacks in every state. Teacher tenure is being targeted in five states: New Jersey, Nevada, Indiana, Idaho and Florida. Laws that would allow parents, by petition, to “trigger” an entire school district to move to charter schools or to voucher programs are expected in at least eleven states. States that are considering either weakening or removing entirely the ability of public sector workers to bargain collectively include not only Wisconsin but Ohio, South Dakota, Colorado, Michigan, Nebraska, New Hampshire and Oklahoma. Measures to dismantle benefits for government workers are expected in some form in all fifty states. Newt Gingrich and Jeb Bush, meanwhile, are pushing to allow states to declare bankruptcy, which would enable them to break their agreements that cover the pensions of hundreds of thousands of retired government workers. On top of all this, President Obama has called for a freeze on federal workers’ pay.

At the same time, a push to privatize public assets and services is mounting, posing a dire threat to public workers. Groups like In the Public Interest ( are working to hold back the privatization tide, but the momentum is on the other side. Donald Cohen, the group’s chair, notes a recent shift in the nature of the opposition. “The entire world of public administration is being driven by a new cartel of consulting firms who offer their services to elected leaders—peddling themselves as efficiency experts,” he says, explaining that these firms are increasingly playing the role that used to be filled by right-wing think tanks. “They are accounting firms, law firms and more who promote privatization, and they make money for completing the deal. And yet it has very little to do with efficiency and probably nothing to do with actually improving public services.”

It isn’t as if these types of attacks on unions are new; what’s different is their scale, intensity and real possibility of success. After outspending unions in November’s election by an estimated 4-to-1 margin, corporations and their allies are exploiting the fiscal crises across the nation to drive a stake into the heart of what is left of organized labor—public workers’ unions. According to the just-released Bureau of Labor Statistics annual report for 2010, the overall union membership rate in America continued its slide, dropping from 12.3 percent to 11.9 percent. But perhaps most striking is the way unionization is skewed when comparing private sector workers, who are just 6.9 percent unionized, and public sector workers, 36.2 percent of whom belong to unions. The public sector, in other words, is labor’s last stronghold.

Grover Norquist laid out a sort of blueprint for the current right-wing assault in the February 2001 American Spectator. Identifying labor unions as the first of “five pillars” of Democratic strength, he calculated that they “raise $8 billion a year from 16 million union members paying an average of $500 dues,” and outlined a game plan for destroying union power, key to the right’s larger mission of abolishing all regulations that impede its agenda, from environmental laws to occupational safety to affirmative action.

But, of course, the right’s campaign against labor has been decades in the making. In 1975 the overall unionization rate in the private sector was 25 percent. Thanks to the class war that has been waged since then—involving trade liberalization, radical reorganization of global finance rules, unionbusting, deindustrialization, rejiggered accounting rules and more—Norquist’s goal is now within reach for the right. According to union expert and author Bill Fletcher Jr., “There has been a three-decade campaign by the neoliberal Democrats and the right wing to destroy the base of the strength of the American middle class, which can be boiled down to unions and government regulation of corporate excess. As a result, unionization rates and corresponding pay and benefits now appear higher in the government sector, and the same forces are now attacking government workers’ unions.”

The irony, according to Janice Fine, professor at the Rutgers School of Management and Labor Relations, is that in the 1960s it was the private sector workers who earned more than their government counterparts. “Back then, the private sector unions helped the government workers get organized as part of a program to raise the standards for all workers,” she notes. Now, as Ed Ott, former director of the New York City Central Labor Council, puts it, “After thirty years of wage suppression in the private sector, big business wants to compare wages and benefits between the private sector and the government sector.” Republican presidential hopeful Tim Pawlenty did just that in a recent Wall Street Journal op-ed. “Unionized public employees are making more money, receiving more generous benefits, and enjoying greater job security than the working families forced to pay for it with ever-higher taxes, deficits and debt,” he wrote. These claims are distorted [see Robert Pollin and Jeffrey Thompson, “The Betrayal of Public Workers”], but to the extent that public workers do enjoy hard-won union benefits, they have a target painted on their back.

The stakes for both political parties in this struggle are high, because where the campaign to gut public sector unions succeeds, Republicans will be poised for almost certain electoral gains. In general, across the nation, the lower the rate of unionization, the redder the state. And in the bluest states, the public sector dominates the union scene: in New York, for example, the most unionized state, the rate among government workers is 70.5 percent, next to 13.7 percent in the private sector. In California the unionization rate among government workers is 56.6 percent, compared with 9.3 percent among the private sector workforce.

There is a strong correlation, moreover, between red states, right-to-work laws, an overall worse quality of life for the average worker or poor person, and a more hostile climate for progressives, from environmentalists to civil rights activists. The average worker in a right-to-work state earns $5,333 less than his or her counterpart in a pro-worker state. Twenty-one percent more people lack health insurance. Late last year, immigration advocates anticipated Arizona-like measures in twenty-two states, eleven of which are controlled by Republicans. Of those, seven are right-to-work states. Not surprisingly, three that are not—Ohio, Pennsylvania and Indiana—are where the attack on government workers’ unions is the strongest.

Given the strategic importance of this fight, you would expect the progressive community to be rallying to mount a loud and vigorous counterattack. But the response has been anemic at best. Unions and progressives need to reset and develop a strategy quickly if they are to defend the ground they still hold, let alone recapture what has been lost. For almost forty years, the right has been systematically tearing apart the achievements of unions and social justice movements. The first challenge is to own up to the ways progressives and unions have failed to counter this onslaught.

Take the teachers unions. In the late 1960s they fought against community control of the New York City schools, sparking tension with the black community that lingers even now. As Fletcher argues, this rift is reflective of some of the deeper issues facing unions. “The AFT, at least until fairly recently, in confronting the attacks on public education, tended toward a very defensive posture. Rarely did they contextualize their fight as part of the larger fight to defend the public sector,” he explains. “Their fight almost had the appearance of being a fight to defend a particular craft under assault rather than to defend a key component of civilization.” As a result, Fletcher points out, neither the American Federation of Teachers nor the National Education Association has been able to assemble significant coalitions for education reform, and even in many progressive circles are seen—unfairly—as a hindrance to education rather than as a key champion.

Likewise, 1199/SEIU alienated progressives with its selfish dealmaking under former New York Governor George Pataki, a Republican. For example, when Blue Cross Blue Shield privatized, the healthcare workers union brazenly claimed the one-time windfall of money to pay for wage increases, in exchange for endorsing the man who was stepping on every other member of the traditional Democratic coalition.

The lukewarm support for unions generally and for government workers unions in particular in the progressive world is partly a legacy of such missteps by unions themselves. But in addition, there’s a more fundamental source of tension that is often ignored: most people who constitute the opinion-making class among liberals and progressives are upper middle class and mostly white. The progressives in academia and journalism, and the staff of most nonprofits from all movements, think tanks and foundations, are from a class that has little to no contact with unions. Even when there is an intellectual understanding of labor’s role in US history, there is often a lack of sympathy about the need for unions today. This is particularly true among liberal and progressive foundations, where support for unions is often a hot-button issue with boards of directors and top executives. Because these foundations represent the employer class for the social change movement, this has impeded the development of more effective strategies to counter the right-wing agenda.

Even among unions the fissures run deep. In New York, for example, where newly elected Democratic Governor Andrew Cuomo has made slashing the state budget his single-minded mission, organized labor has not put up a united front against the cutbacks. The construction unions were especially eager to sell out the government workers unions for their own benefit. Ott explains how this works: “With the crashing economy, unemployment in the building trades in NYC is now somewhere in the 35 percent range, and some political entity comes along and says to the trades, ‘Hey, we will produce some jobs for your members on the capital side if you support us politically in this revenue fight.’”

This logic is not unusual for construction unions, which operate largely as craft unions—representing workers with a specific craft or skill, who have the ability to negotiate for themselves by withholding that skill. The construction unions have a long history of being an elitist labor force that has been used by politicians to split the union movement.

Rutgers’s Janice Fine says that overcoming divisions will take real work among unions. “When unionization rates and corresponding pay and benefits are so asymmetrical between the public and private sectors, unions have to take very deliberate steps to preserve solidarity,” she says, citing historical examples of public unions providing support to private sector unions by boycotting products, stores and companies, and supporting union products, banks and hotels. “This tradition is gone, and union members need to go back to consuming in a way that supports the unionized class. And private sector unions need to resist the short-term gain of undercutting public sector unions’ wages, benefits and pensions as it will only reinforce a race to the bottom that has no place for unions of any kind.”

The entire house of labor and all progressives must understand that we have not had a moment as threatening as this in our lifetime. The right is making the connections—attacking public employee unions and public services at the same time in order to wage complete war on the poor, people of color, and the working and middle classes of this country. Sadly, the left has not made the connections. To the extent that public sector unions, private sector unions and those fighting budget cuts allow themselves to be divided, they are playing into the right’s hands.

Assuming unions and progressives can focus on the enormity of the challenge before us, let’s review some of the tools and knowledge in our arsenal to defeat the antigovernment and antiunion offensive.

In Nevada, where I led a union that had been heavily dominated by public sector workers, we successfully beat back a divide-and-conquer unionbusting campaign waged by right-wing forces who had teamed up with the Democrats who led county government. In 2003 a Democratic county executive named Thom Reilly aligned with the Chamber of Commerce and the Nevada Taxpayers Union to produce a report that sounded the same themes as the current national campaign against government workers. In a media blitz, Reilly blasted public workers for earning more than their private sector counterparts. With a Democrat as the messenger, liberals were confused, including many union members.

In response, we set out first with a massive campaign to educate the rank and file about the coming attack. In the first year, we organized meetings with more than 2,000 government workers by designing an educational module distributed to almost every unionized facility at break times and shift changes. At every union meeting for two years, attention was directed to the economy; the class war against all workers; how the right had come first for private sector unions and now were coming for public sector unions; and the need to “draw a line in the desert” to raise expectations, so that workers could unite to reclaim what they deserved.

We talked openly and often about how, if the county executive wanted to point out the disparity in the pay of unionized government workers versus that of workers in the nonunionized private sector, he was right. But rather than accepting that government workers—including many people of color and women—who still had a decent job with the ability to retire should surrender what they had to the lowest common denominator, we challenged them to get behind two big initiatives. The first was to organize the private sector workers as fast as possible so that we could bring them up to the same standard. The second was to change the image of the government workers by making the quality of the government services reflect the highest standards possible. We wanted “government workers” to have a sort of Good Housekeeping Seal of Approval in the public’s mind.

We kept at these efforts over the next several years, and by the time the government workers arrived at their next round of collective bargaining, the county executive’s message—that county workers were overpaid compared with their private sector counterparts—had lost its force. For one thing, we had raised private sector standards through organizing and negotiating strong contracts. In fact, in a two-year period, the private sector hospital workers went from wages and benefits far below those at the big public hospital to wages higher than and benefits catching up to those of government workers. And through it all, we elevated an internal education campaign and external message framed around the American Dream—who had stolen it and how the way to bring it back was by organizing, bargaining and setting higher standards for all workers. It was crucial that despite lots of strains, union solidarity held together to beat back one ballot initiative after another that sought to all but eliminate the already small tax base in Nevada.

We also took on the libertarian contempt for government that was so popular in Nevada—which was prominently displayed in hateful editorial cartoons like those that are now common in states like New Jersey, depicting government workers as fat, lazy, overpaid bureaucrats. We did this in part by engaging the members in a newly designed training program for union stewards aimed at reshaping the grievance process for a union whose workers perform services for the community rather than assembly line work on a machine. But it was only after thousands of conversations that we were able to help workers—even government workers—overcome their suspicions of government.

We know that Americans are predisposed to be more suspicious of government than they are of unions. Union organizer Fernando Gapasin, co-author of Solidarity Divided, says, “Karl Rove did an analysis of the core values of Americans, and he took that individualism is one core idea. For a lot of people this translates to the corporations as the highest form of someone’s individual aspirations. For a lot of people individual responsibility and individual achievement gets confusing, and it leads to workers telling me that if they were laid off, they would refuse to collect unemployment, because if they or their families can’t take care of themselves, there’s something wrong with them.” The Norquist forces are, in effect, running a message that aligns neatly with the dominant cultural narrative in America. Unions and progressives have a message and solutions that are seemingly running against this narrative. This is precisely why organizers and organizing are required, not simply mobilizing and messaging.

Liberals and progressives don’t understand why, in poll after poll, Americans support Social Security, Medicare and money for their local parks and other services but oppose “big government.” If we want to close the gap in the often bimodal results of polling, we don’t need more polling: we need well-trained and highly skilled organizers who can help facilitate conversations among next-door neighbors and co-workers. We have good “framers.” We have smart policy wonks with big degrees who can write good policy. We have lawyers to defend the policy. And we have no one in any serious way out talking with Americans about this crisis. It’s organizers who help people in large numbers to come to the self-realization that things aren’t working and that it isn’t their fault. Good organizing is really the only way that workers, the unemployed and the poor can overcome the impulse to blame themselves for the crisis they face. Yet liberal foundations often balk at funding such efforts, believing that it won’t add up to policy change and channeling money instead to policy, legal and “communications” work.

Unions and progressives need to return to engaging large numbers of people in one-on-one conversations. Unions should kick-start the campaign by sponsoring and unleashing the biggest Union Summer program of all time and pay student interns, and unemployed rank-and-file workers, to work with union groups and nonunion allies in a mass education campaign that seeks to change the narrative from “We all go down together” to “It’s time to return to the American Dream we all deserve.” Unions must stop pretending to be engaging the base by setting up call centers or buying cellphones for their members. Foundations must stop pretending that unions don’t matter, and that messaging strategies can overcome America’s cultural norms of extreme individualism. Real conversations, where people have a chance to understand the war that is being waged against them and the power they must build, are the only thing that will save us.

Bahrain Opposition Officially Submit Demands To Government

Bahrain Opposition Officially Submit Demands To Government

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MANAMA (Dow Jones)--Bahrain's formal opposition groups officially submitted demands to the ruling Al-Khalifa family that included the introduction of a constitutional monarchy and the dissolution of the government.

The grouping of six main opposition parties, including major Shiite opposition bloc Al-Wefaq as well as secular groups, outlined its core demands at a press conference in Manama. The proposals included the release of all political prisoners, electoral reform and the formation of a new interim government, along with an independent investigation into the deaths of seven protesters since the clashes here began over a week ago.

The opposition groups said the demands represented a formal response to the Crown Prince's call for dialogue, but stressed that the opening of direct talks would depend on the government's acceptance of their framework and guaranteeing the safety of anti-government protesters.

"We want [the] regime to say that in principle they agree to [the] abolition of 2002 constitution and [a] new assembly on one man, one vote," said Ebrahim Sharif, a Sunni Muslim and former banker who heads the National Democratic Action Society, one of the groups tasked with unifying the opposition's message, adding that the ruling family must recognize "the rights of people to have [a] fully elected parliament with exclusive judicial oversight power."

However, the list of demands risk dividing the more moderate opposition grouping that has been charged with articulating the issues and the protesters encamped on the square, many of whom are calling for sweeping regime change and reject any dialogue with the ruling family.

China Moves To Making Renminbi Reserve Currency

China "Attacks The Dollar" - Moves To Further Cement Renminbi Reserve Currency Status

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In a surprising turn of events, today's biggest piece of news received a mere two paragraph blurb on Reuters, and was thoroughly ignored by the broader media. An announcement appeared shortly after midnight on the website of the People's Bank of China.

The statement, google translated as "Pragmatic and pioneering spirit to promote cross-border renminbi business cum on monitoring and analysis to a new level" is presented below:

Reuters provides a simple translation and summary of the announcement: "China hopes to allow all exporters and importers to settle their cross-border trades in the yuan by this year, the central bank said on Wednesday, as part of plans to grow the currency's international role. In a statement on its website, the central bank said it would respond to overseas demand for the yuan to be used as a reserve currency. It added it would also allow the yuan to flow back into China more easily." To all those who claim that China is perfectly happy with the status quo, in which it is willing to peg the Renmibni to the Dollar in perpetuity, this may come as a rather unpleasant surprise, as it indicates that suddenly China is far more vocal about its intention to convert its currency to reserve status, and in the process make the dollar even more insignificant.

International Business Times provides further insight:

This is all part of China’s plan for the internationalization of its currency, which may, in the decades to come, threaten the global ‘market share’ of other currencies like the US dollar.

Previously, China also announced that bilateral trades with Russia and Malaysia will begin to be conducted with the yuan and the ruble and ringgit, respectively.

Other moves on the part of China to internationalize its currency include allowing foreign companies to issue yuan-denominated bonds and relaxing rules for foreign financial institutions to access the yuan.

Aside from the efforts of the Chinese government, fundamentals also point to the increasing international popularity of the Chinese currency.

China is already the leading trade partner with Australia and Japan. It’s also the leading or a large trade partner with many of its smaller neighbors. The purpose of having foreign currencies is to conduct foreign trade and investment, so the yuan is expected to become a more attractive currency for China’s trade partners, espeically as the government continues to relax restrictions.

The reason for this dramatic move may be found in what Stephen Roach wrote a few days ago in Project Syndicate:

In early March, China’s National People’s Congress will approve its 12th Five-Year Plan. This Plan is likely to go down in history as one of China’s boldest strategic initiatives.

In essence, it will change the character of China’s economic model – moving from the export- and investment-led structure of the past 30 years toward a pattern of growth that is driven increasingly by Chinese consumers. This shift will have profound implications for China, the rest of Asia, and the broader global economy.

Like the Fifth Five-Year Plan, which set the stage for the “reforms and opening up” of the late 1970’s, and the Ninth Five-Year Plan, which triggered the marketization of state-owned enterprises in the mid-1990’s, the upcoming Plan will force China to rethink the core value propositions of its economy. Premier Wen Jiabao laid the groundwork four years ago, when he first articulated the paradox of the “Four ‘Uns’” – an economy whose strength on the surface masked a structure that was increasingly “unstable, unbalanced, uncoordinated, and ultimately unsustainable.”

The Great Recession of 2008-2009 suggests that China can no longer afford to treat the Four Uns as theoretical conjecture. The post-crisis era is likely to be characterized by lasting aftershocks in the developed world – undermining the external demand upon which China has long relied. That leaves China’s government with little choice other than to turn to internal demand and tackle the Four Uns head on.

The 12th Five-Year Plan will do precisely that, focusing on major pro-consumption initiatives. China will begin to wean itself from the manufacturing model that has underpinned export- and investment-led growth. While the manufacturing approach served China well for 30 years, its dependence on capital-intensive, labor-saving productivity enhancement makes it incapable of absorbing the country’s massive labor surplus.

Instead, under the new Plan, China will adopt a more labor-intensive services model. It will, one hopes, provide a detailed blueprint for the development of large-scale transactions-intensive industries such as wholesale and retail trade, domestic transport and supply-chain logistics, health care, and leisure and hospitality.

Obviously, a reserve currency would be not only extremely useful, but quite critical in achieving the goal of China's conversion to an inwardly focused, middle-class reliant society. And even that would not guarantee a smooth transition. However, should China really be on a path to a step function in its evolution, the shocks to the system will be massive. Roach puts this diplomatically as follows:

But there is a catch: in shifting to a more consumption-led dynamic, China will reduce its surplus saving and have less left over to fund the ongoing saving deficits of countries like the US. The possibility of such an asymmetrical global rebalancing – with China taking the lead and the developed world dragging its feet – could be the key unintended consequence of China’s 12th Five-Year Plan.

A less diplomatic version implies that the relationship between China and the US would suffer a seismic shift in which the game theoretical model of Mutual Assured Destruction, and symbiotic monetary and fiscal policies, would no longer exist, allowing China to pursue its fate completely independent of any economic shocks that the increasingly distressed United States may be going through.

And confirming that the PBoC announcement is far more serious than the amount of airtime allotted to it by the mainstream media, is the just released article in Spiegel "China Attacked the Dollar" (google translated):

The Chinese central bank surprised with a spectacular announcement: The would-be superpower wants to handle their entire future foreign trade in yuan, not in dollars. Beijing shakes America's claim to represent the key currency - with serious consequences for the U.S..

The announcement was inconspicuous , but it has the potential, to permanently change the balance of power on the world currency market: China strengthens the international role of the yuan. All exporters and importers will, this year, be allowed to settle their business with their foreign partners in Yuan, the central bank said on Wednesday in Beijing.

This will respond to the growing importance of the yuan as a global reserve currency. "The market demand for cross-border use of the yuan rises," said the central bank. The PBoC had previously tested this plan by allowing 67 000 enterprises in 20 provinces to run their business abroad in yuan. The trade volume amounted to the equivalent of €56 billion.

Now the amount of yuan to be extended, it should be handled much more business in Chinese currency - and less in the U.S. Chinese companies trade at present often in dollars, they are thus dependent on the decisions of the U.S. Federal Reserve to pay on it in a rising oil price and will have pay higher transaction fees than necessary. That should change now.

Currently, the People's Republic can hardly take yuan out of the country and even that is monitored within the boundary of all legitimate capital flows. Chinese exporters have to change a large part of their euro, yen or dollars at a fixed rate revenue in yuan. Foreign companies wishing to do business in China must do so in Yuan, they can exchange their money in the People's Republic. Tourists are allowed a maximum of 20,000 yuan and exporting. Yuan an international market can not occur - and not on supply and demand-based exchange rate.

Needless to say, should the yuan be seen increasingly as a reserve currency, all of this, and virtually everything else is about to change.

The only question is whether or not the Yuan will cement its status at the top of the currency pyramid by allowing the backing of the currency with individual or a basket of commodities. If that were to happen, it would be the last nail in the coffin of the already terminally ill dollar.