Wednesday, February 13, 2013

Petrogold: Are Russia And China Hoarding Gold Because They Plan To Kill The Petrodollar?

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Will oil soon be traded in a currency that is thousands of years old?  What would a "gold for oil" system mean for the petrodollar and the U.S. economy?  Are Russia and China hoarding massive amounts of gold because they plan to kill the petrodollar?  Since the 1970s, the U.S. dollar has been the currency that the international community has used to trade oil around the globe.  This has created an overwhelming demand for U.S. dollars and U.S. debt.  But what happens when the rest of the globe starts rejecting the increasingly unstable U.S. dollar and figures out that gold can be used as a currency in international trade?  The truth is that it doesn't take a lot of imagination to figure that out.  Demand for the U.S. dollar and U.S. debt would fall off the map and there would be a rush into gold unlike anything we have ever seen before.  So are Russia and China accumulating unprecedented amounts of gold right now because they eventually plan to cut the legs out from under the petrodollar and they want to gobble up huge stockpiles of gold before the cat is out of the bag?  Of course they will never admit this publicly, but there are rumblings out there that this is exactly what is happening.
Not that you can really blame any nation that wants to get into gold right now.  News outlets all over the globe are telling us that we are in the midst of a "currency war" as central banks all over the planet race to devalue their currencies.
So why would anyone want to be in paper in such an environment?
And of course the Federal Reserve is one of the biggest offenders.  The Fed has been printing money like it is going out of style, and nobody at the Fed or in the U.S. government really seems too concerned that all of this money printing could be endangering the petrodollar.
But the truth is that the Fed is endangering the petrodollar.  Just read some foreign news stories about the U.S. dollar.  They mock us for our reckless money printing.
In the end, our recklessness will make it very easy for the rest of the world to ditch the U.S. dollar.
At some point, it will happen.  In fact, there are persistent rumors that Russia and China actually intend to make it happen.
Many believe that this is the reason both nations have been hoarding so much gold recently.
Just check out how much gold Russia has been accumulating.  The following is from a recent Bloomberg article...
When Vladimir Putin says the U.S. is endangering the global economy by abusing its dollar monopoly, he’s not just talking. He’s betting on it.
Not only has Putin made Russia the world’s largest oil producer, he’s also made it the biggest gold buyer. His central bank has added 570 metric tons of the metal in the past decade, a quarter more than runner-up China, according to IMF data compiled by Bloomberg. The added gold is also almost triple the weight of the Statue of Liberty.
“The more gold a country has, the more sovereignty it will have if there’s a cataclysm with the dollar, the euro, the pound or any other reserve currency,” Evgeny Fedorov, a lawmaker for Putin’s United Russia party in the lower house of parliament, said in a telephone interview in Moscow.
And Russia's gold hoarding appears to have accelerated last year.  According to one recent report, Russia added 3.2 million ounces of gold to their reserves in 2012 alone.
But of even greater concern is China.  Nobody really knows how much gold China has, because they do not tell us, but all indications point to the fact that Chinese gold hoarding has gone into overdrive.  The following is from a Zero Hedge article from a few months ago...
Because while earlier today we were wondering (rhetorically, of course) what China is doing with all that excess trade surplus if it is not recycling it back into Treasurys, now we once again find out that instead of purchasing US paper, Beijing continues to buy non-US gold, in the form of 68 tons in imports from Hong Kong in the month of June. The year to date total (6 months)? 383 tons. In other words, in half a year China, whose official total tally is still a massively underrepresented 1054 tons, has imported more gold than the official gold reserves of Portugal, Venezuela, Saudi Arabia, the UK, and so on, and whose YTD imports alone make it the 14th largest holder of gold in the world. Realistically, by now China, which hasn't provided an honest gold reserve holdings update to the IMF in years, most certainly has more gold than the IMF, and its 2814 tons, itself. Of course, the moment the PBOC does announce its official updated gold stash, a gold price in the mid-$1000 range will be a long gone memory.
As I wrote about the other day, nobody produces more gold than China does, and nobody imports more gold than China does.
Everyone agrees that China seems to have an insatiable appetite for gold, but nobody can agree on exactly how much gold they actually have.  One recent estimate put China's gold reserves at more than 7,000 tons of gold, but it could even be much higher than that.  Nobody really knows.
So what are Russia and China up to?
Well, for a long time both nations have expressed displeasure with the fact that the U.S. dollar is the de facto currency of the world.  Leaders from both nations have suggested the possibility of adopting a new global reserve currency, but up to this point no real contenders have emerged to dethrone the U.S. dollar.
So for now, the U.S. dollar reigns supreme in international trade.  Sadly, even though most Americans greatly benefit from the petrodollar, most of them do not even know what it is.  For those that do not fully understand the petrodollar, the following is a good explanation of the petrodollar from a recent article by Christopher Doran...
In a nutshell, any country that wants to purchase oil from an oil producing country has to do so in U.S. dollars. This is a long standing agreement within all oil exporting nations, aka OPEC, the Organization of Petroleum Exporting Countries. The UK for example, cannot simply buy oil from Saudi Arabia by exchanging British pounds. Instead, the UK must exchange its pounds for U.S. dollars. The major exception at present is, of course, Iran.
This means that every country in the world that imports oil—which is the vast majority of the world's nations—has to have immense quantities of dollars in reserve. These dollars of course are not hidden under the proverbial national mattress. They are invested. And because they are U.S. dollars, they are invested in U.S. Treasury bills and other interest bearing securities that can be easily converted to purchase dollar-priced commodities like oil. This is what has allowed the U.S. to run up trillions of dollars of debt: the rest of the world simply buys up that debt in the form of U.S. interest bearing securities.
And all of this has worked out very nicely for the United States.  It has created a massive demand for U.S. dollars and U.S. debt.
But what would happen if the rest of the world rejected the petrodollar system and adopted a "petrogold" system instead?
A recent article by Jim Willie discussed how a petrogold system might work...
The crux of the non-US$ trade vehicle devised as a USDollar alternative will be the Gold Trade Note. It will enable peer-to-peer payments to be completed from direct account transfers independent of currency, and most importantly, not done through the narrow pipes and channels controlled by the bankers with their omnipresent SWIFT code system among the world of banks. The Gold Trade Note will act much like a Letter of Credit, serve as a short-term bill, and maybe even push aside the near 0% short-term USTreasury Bills that litter the banking landscape. Any bond or bill earning almost no interest is veritable clutter. The zero bound USTreasurys open the door in a big way for replacement by a better vehicle. The new trade notes will involve posted gold as collateral, whose entire system for trade usage will bear a massive gold core that also will include silver and platinum, maybe other precious metals. The idea is to avoid the FOREX systems, to avoid the USDollar, and to avoid the banks as much as possible in a peer-to-peer system that can be executed between parties holding Blackberry devices or simple PC to complete the payments on transactions. If Gold is ignored by the corrupt bankers, then Gold will be the center of the new trade system and the solution in providing a globally accepted USDollar alternative.
And Russia and China would greatly benefit from a petrogold system.
Today, Russia is the number one oil exporter on the planet.
China is the number two consumer of oil in the world, and at this point they are actually importing more oil from Saudi Arabia than the United States is.
Does it make sense that they should remain locked into a system that forces them to use U.S. dollars for all of their oil transactions?
And now Russia even has the number one oil company in the world.  The following is from a recent article by Marin Katusa...
Exxon Mobil is no longer the world's number-one oil producer. As of yesterday, that title belongs to Putin Oil Corp – oh, whoops. I mean the title belongs to Rosneft, Russia's state-controlled oil company.
Rosneft is buying TNK-BP, which is a vertically integrated oil company co-owned by British oil firm BP and a group of Russian billionaires known as AAR. One of the top-ten privately owned oil producers in the world, in 2010 TNK-BP churned out 1.74 million barrels of oil equivalent per day from its assets in Russia and Ukraine and processed almost half that amount through its refineries.
With TNK-BP in its hands, Rosneft will be in charge of more than 4 million barrels of oil production a day. And who is in charge of Rosneft? None other than Vladimir Putin, Russia's resource-full president.
And Russian gas giant Gazprom supplies a huge percentage of the natural gas that Europe uses...
Gazprom, the Russian state gas company, already has Europe wrapped around its little finger. Russia supplies 34% of Europe's gas needs, and when the under-construction South Stream pipeline starts operating, that percentage will increase. As if those developments weren't enough, yesterday Gazprom offered the highest bid to obtain a stake in the massive Leviathan gas field off Israel's coast.
Gazprom in control of Europe's gas, Rosneft in control of its oil. A red hand stretching out from Russia to strangle the supremacy of the West and pave the way for a new world order– one with Russia at the helm.
Russia and China have a tremendous amount of leverage when it comes to energy.  What if they got together with a bunch of oil producing nations in the Middle East and decided to set up a system where oil is traded for gold?  Would not much of the rest of the world go along with such a system?
Of course if that happened the U.S. financial system would crash.  We would no longer be able to export our inflation to the rest of the globe and prices would rise dramatically.  Demand for U.S. government debt would go through the floor and interest rates on that debt and on everything else in our economy would skyrocket.  Economic activity would grind to a standstill and the financial markets would collapse.
And that would just be for starters.
Most Americans simply don't understand that Russia and China have the power to collapse the U.S. economy by going to a gold for oil system.  All they have to do is pull the trigger.
The other day I wrote an article entitled "Show This To Anyone That Believes That 'Things Are Getting Better' In America" which discussed all of the reasons why the U.S. economy is already collapsing.  But as bad as things are now, this is nothing compared to what things will be like when the petrodollar dies.
So pay keen attention to anything in the news about Russia or China suggesting that oil should be traded for gold.  When Russia and China pull the trigger, things will get messy very quickly.

The War in Mali and AFRICOM’s Agenda: Target China

Part I: Africa’s New Thirty Years’ War?
Mali at first glance seems a most unlikely place for the NATO powers, led by a neo-colonialist French government of Socialist President Francois Hollande (and quietly backed to the hilt by the Obama Administration), to launch what is being called by some a new Thirty Years’ War Against Terrorism.
Mali, with a population of some 12 million, and a landmass three and a half times the size of Germany, is a land-locked largely Saharan Desert country in the center of western Africa, bordered by Algeria to its north, Mauritania to its west, Senegal, Guinea, Ivory Coast, Burkina Faso and Niger to its southern part. People I know who have spent time there before the recent US-led efforts at destabilization called it one of the most peaceful and beautiful places on earth, the home of Timbuktu. Its people are some ninety percent Muslim of varying persuasions. It has a rural subsistence agriculture and adult illiteracy of nearly 50%. Yet this country is suddenly the center of a new global “war on terror.”
On January 20 Britain’s Prime Minister David Cameron announced his country’s curious resolve to dedicate itself to deal with “the terrorism threat” in Mali and north Africa. Cameron declared, “It will require a response that is about years, even decades, rather than months, and it requires a response that…has an absolutely iron resolve…” [1] Britain in its colonial heyday never had a stake in Mali. Until it won independence in 1960, Mali was a French colony.
On January 11, after more than a year of behind-the-scenes pressure on the neighboring Algeria to get them entangled in an invasion of its neighbor Mali, Hollande decided to make a direct French military intervention with US backing. His government launched air strikes in the rebel-held north of Mali against a fanatical Salafist band of jihadist cutthroats calling itself Al-Qaeda in the Islamic-Mahgreb (AQIM). The pretext for the seemingly swift French action was a military move by a tiny group of Islamic Jihadists of the Tuareg people, Asnar Dine, affiliated with the larger AQIM. On January 10 Asnar Dine – backed by other Islamist groups – attacked the southern town of Konna. That marked the first time since the Tuareg rebellion in early 2012 that Jihadist rebels moved out of traditional Tuareg territory in the northern desert to spread Islamic law to the south of Mali.
As French journalist Thierry Meyssan noted, French forces were remarkably well prepared: “The transitional President, Dioncounda Traore, declared a state of emergency and called to France for help. Paris intervened within hours to prevent the fall of the capital, Bamako. Far-sightedly, the Elysée had already pre-positioned in Mali troops from the 1st Marine Infantry Parachute Regiment (“the Colonials”) and the 13th Parachute Dragoon Regiment, helicopters from the COS (Special Operations Command), three Mirage 2000D’s, two Mirage F-1’s, three C135’s, a C130 Hercules and a C160 Transall.” [2] What a convenient coincidence.
By January 21 US Air Force transport planes began delivering hundreds of French elite soldiers and military equipment to Mali, ostensibly to roll back what we were told was an out-of-control terrorist advance south towards the Mali capital. [3] French Defense Minister Jean-Yves Le Drian told media the number of its ‘boots on the ground’ in Mali had reached 2,000, adding that “around 4,000 troops will be mobilized for this operation,” in Mali and outside bases. [4]
But there are strong indications the French agenda in Mali is anything but humanitarian. In a France 5 TV interview, Le Drian carelessly admitted, “The goal is the total reconquest of Mali. We will not leave any pockets.” And President Francois Hollande said French troops would remain in the region long enough “to defeat terrorism.” The United States, Canada, Britain, Belgium, Germany and Denmark have all said they would support the French operation against Mali. [5]
Mali itself, like much of Africa is rich in raw materials. It has large reserves of gold, uranium and most recently, though western oil companies try to hide it, of oil, lots of oil. The French preferred to ignore Mali’s vast resources, keeping it a poor subsistence agriculture country. Under the deposed democratically-elected President Amadou Toumani Toure, for the first time the government initiated a systematic mapping of the vast wealth under its soil. According to Mamadou Igor Diarra, previous mining minister, Malian soil contains copper, uranium, phosphate, bauxite, gems and in particular, a large percentage of gold in addition to oil and gas. Thus, Mali is one of the countries in the world with the most raw materials. With its gold mining, the country is already one of the leading exploiters directly behind South Africa and Ghana. [6] Two thirds of France’s electricity is from nuclear power and sources of new uranium are essential. Presently, France draws significant uranium imports from neighboring Niger.
Now the picture gets a little complex.
According to usually reliable former US military experts with direct familiarity with the region, speaking on condition of anonymity, US and NATO Special Forces actually trained the same “terrorist” bands now justifying a neo-colonial US-backed invasion of Mali by France. The major question is why would Washington and Paris train the terrorists they are now acting to destroy in a “war on terror?” Were they really surprised at the lack of NATO loyalty from their trainees? And what is behind AFRICOM’s American-backed French takeover of Mali?

Part II: AFRICOM and ‘Victoria’s Secrets’

The truth about what is really going on in Mali and with AFRICOM and NATO countries, especially France is a little bit like a geopolitical “Victoria’s Secret”—what you think you see is definitely not what you will get.
We are being told repeatedly in recent months that something supposedly calling itself Al Qaeda—the organization officially charged by the US Government as responsible for pulverizing three towers of the World Trade Center and blowing a gaping hole in the side of the Pentagon on September 11, 2001—has regrouped.
According to the popular media account and statements of various NATO member country government officials, the original group of the late Osama bin Laden, holed up we are supposed to believe somewhere in the caves of Tora Bora in Afghanistan, has apparently adopted a modern business model and is handing out Al Qaeda official franchises in a style something like a ‘McDonalds of Terrorism,’ from Al Qaeda in Iraq to Libyan Islamic Fighting Group in Libya and now Al-Qaeda-in-the Islamic-Maghreb.
I’ve even heard reports that a new Al Qaeda “official” franchise has just been given, bizarre as it sounds, to something called DRCCAQ or Democratic Republic of Congo Christian (sic) Al Qaeda. [7] Now that’s a stretch which reminds one of an equally bizarre sect called Jews for Jesus created back in the hippie days of the Vietnam War era. Can it be that the architects of all these murky groups have so little imagination?
If we are to believe the official story, the group being blamed in Mali for most all the trouble is Al Qaeda in the Islamic Maghreb (AQIM for short). The murky AQIM itself is actually a product of several behind-the-scenes workings. Originally it was based in Algeria across the border from Mali and called itself the Salafist Group for Preaching and Combat (GSPC according to its French name).
In 2006 Al Qaeda’s head guru in absence of Osama bin Laden, Egyptian jihadist Ayman al-Zawahiri, publicly announced the granting to the Algerian GSPC the Al Qaeda franchise. The name was changed to Al-Qaeda-in-the Islamic-Mahgreb and Algerian counter-terror operations pushed them in the past two years over the desert border into northern Mali. AQIM reportedly is little more than a well-armed criminal band that gets its money from running South American cocaine from Africa into Europe, or from arms dealing and human trafficking. [8]
A year later, in 2007, the enterprising al-Zawahiri added another building block to his Al Qaeda chain of thugs when he officially announced the merger between the Libyan LIFG and al-Qaeda in the Islamic Mahgreb (AQIM).
The LIFG or Libyan Islamic Fighting Group, was formed by a Libyan-born jihadist named Abdelhakim Belhaj. Belhaj was trained by the CIA as part of the US-financed Mujahideen in Afghanistan during the 1980s alongside another CIA trainee then named Osama bin Laden. In essence, as the journalist Pepe Escobar notes, “for all practical purposes, since then, LIFG/AQIM have been one and the same – and Belhaj was/is its emir.” [9]
That becomes even more interesting when we find that Belhaj’s men – who, as Escobar writes, were at the forefront of a militia of Berbers from the mountains southwest of Tripoli, the so-called Tripoli Brigade—were trained in secret for two months by US Special Forces. [10]
LIFG played a key role in the US and French-backed toppling of Libya’s Qaddafi, turning Libya today into what one observer describes as the “world’s largest open air arms bazaar.” Those arms are reportedly flooding from Benghazi to Mali and other various hotspot targets of destabilization, including, according to what was suggested at the recent US Senate Foreign Relations testimony of outgoing Secretary of State Hillary Clinton, by the boatload from Libya to Turkey where they were being channeled into the various foreign terrorist insurgents sent into Syria to fuel the destruction of Syria. [11]
Now what does this unusual conglomerate globalized terror organization, LIFG-GPSC-AQIM intend in Mali and beyond, and how does that suit AFRICOM and French aims?

Part III: Curious Mali Coup and AQIM terror—exquisite timing

Events in the formerly peaceful, democratic Mali began to get very strange on March 22, 2012 when Malian President Amadou Toumani Toure was ousted and driven into exile in a military coup one month before a scheduled presidential election. Toure had earlier instituted a multi-party democratic system. The putsch leader, Captain Amadou Haya Sanogo, received military training in the US, at Fort Benning, Georgia and the Marine Corps base in Quantico, Virginia according to AFRICOM’s spokesman. [12] Sanogo claimed the military coup was necessary because Toure’s government was not doing enough to quell Tuareg unrest in northern Mali.
As Meyssan points out, the March 2012 military coup against Toure was suspicious in every regard. A previously unheard-of group called CNRDRE (in English: National Commitee for the Recovery of Democracy and the Restoration of the State) overthrew Touré and declared intention to restore Mali law and order in the north.
“This resulted in great confusion,” Meyssan goes on, “since the putschists were incapable of explaining how their actions would improve the situation. The overthrow of the President was even stranger since a presidential election was to be held five weeks later and the outgoing President was not running for office. The CNRDRE is composed of officers who were trained in the United States. They halted the election process and handed power to one of their candidates, who happened to be the Francophile Dioncounda Traore. This sleight of hand was legalized by the CEDEAO (or in English, ECOWAS—Economic Community of West African States), whose President is none other than Alassane Ouattara, who was placed in power in the Ivory Coast by the French army a year earlier.” [13]
Alassane Ouattara, educated in economics in the US, is a former senior IMF official who in 2011 forced out his Ivory Coast presidential rival with French military assistance. He owes his job not to “the New York Times,” but to French Special Forces. [14]
At the time of the military coup, the unrest in question was from an ethnic tribe, Tuareg, a secular, nomadic group of pastoral cattle-herding people who demanded independence from Mali in early 2012.
The Tuareg Rebellion was reportedly armed and financed by France who repatriated Tuaregs who had been fighting in Libya for the purpose of splitting the north of Mali along Algeria’s border, from the rest of the country and declaring Sharia law. It only lasted from January to April 2012, at which time the nomadic Tuareg fighters rode off to their nomad haunts in the central Sahara and borders of the Sahel, a vast borderless desert area between Libya and Algeria, Mali and Niger. That left the Algerian-Libyan LIFG/Al Qaeda in the Islamic Maghreb and their associates in the Jihadist Asnar Dine to carry out the dirty work for Paris. [15]
In their 2012 battle for independence from Mali, the Tuareg had made an unholy alliance with the Jihadist AQIM. Both groups, briefly joined together with Asnar Dine, another islamist organization led by Iyad Ag Ghaly. Asnar Dine is believed to have ties to Al-Qaeda in the Islamic Maghreb which is led by Ag Ghaly’s cousin, Hamada Ag Hama. Ansar Dine wants the imposition of strict Sharia law across Mali.
The three main groups briefly joined forces the moment Mali was plunged into chaos following the March 2012 military coup. The coup leader was Captain Amadou Haya Sanogo, who received military training at the Marine Corps camp at Quantico, Virginia and Special Forces training at Fort Benning, Georgia in the US. In a bizarre play of events, despite the claim the coup was driven by the civilian government’s failure to contain the rebellion in the north, the Malian military lost control of the regional capitals of Kidal, Gao, and Timbuktu within ten days of Sanogo’s assuming office. Reuters describe the farcical coup as “a spectacular own-goal.” [16]
The violation of Mali’s constitution by the military was used to trigger severe sanctions against the central military government. Mali was suspended from membership in the African Union; the World Bank and African Development Bank have suspended aid. The US has cut half of the $140 million in aid that it sends each year, all of which created chaos in Mali and made it virtually impossible for the government to respond to the growing loss of territory in the north to Salafists.

Part IV: Terror-Anti-Terror

What then ensued is like a page ripped out of the insurgency-counter-insurgency textbook of Britain’s Brigadier Frank E. Kitson during the 1950s British Mau Mau operations in Kenya. The Jihadist insurgency in the North and the simultaneous military coup in the capital led to a situation in which Mali was immediately isolated and massively punished with economic sanctions.
Acting with indecent haste, the US and French-controlled regional 15-member Economic Community of West African States (ECOWAS) demanded the coup leaders restore civilian rule. On March 26, the US cut off all military aid to the impoverished country, ensuring maximum chaos just as the Jihadists made their major push south., Then at a meeting April 2 in Dakar, Senegal, ECOWAS members closed their countries’ borders with land-locked Mali and imposed severe sanctions, including cutting off access to the regional bank, raising the possibility that Mali will soon be unable to pay for essential supplies, including gasoline.
The same military that “trains” the terrorists also trains the “anti-terrorists.” This seems a bizarre contradiction in policy only when we fail to grasp the essence of US and British-developed methods of irregular warfare employed actively since the early 1950’s.
The method was originally termed Low Intensity Warfare by the British Army officer who developed and refined the method for control of subject areas in Malaysia, Kenya during the Mau Mau 1950’s freedom struggles and later for the British Army in Northern Ireland. Low intensity warfare as he termed it in a book by that name, [17] involves use of deception, of infiltration of double-agents, provocateurs, and use of defectors into legitimate popular movements such as those struggles for colonial independence after 1945.
The method is sometimes referred to as “Gang/Counter-Gang.” The essence is that the orchestrating intelligence agency or military occupying force, whether the British Army in Kenya or the CIA in Afghanistan, de facto controls the actions of both sides in an internal conflict, creating small civil wars or gang wars to the aim of dividing the overall legitimate movement and creating the pretext for outside military force in what the US now has deceptively renamed as “Peace-Keeping Operations” or PKO. [18]
In his advanced course on American Military Intervention Since Vietnam, Grant Hammond of the US Air War College refers openly to Low Intensity Conflict aka Peace Keeping Operations as “war by another name.” [19]
We begin to see the bloody footprints of a not-so-well-disguised French recolonisation of former French Africa, this time using Al-Qaeda terror as the springboard to direct military presence for the first time in more than half a century. French troops will likely stay on to help Mali in a “peace keeping operation.” The US is fully backing France as AFRICOM’s “cat’s paw.” And Al Qaeda in the Islamic Maghreb and its spinoffs make the whole NATO military intervention possible.
Washington claimed to have been caught blind-sided by the military coup. According to press reports, a confidential internal review completed July 2012 by the Pentagon’s Africa Command (AFRICOM) concluded that the coup had unfolded too fast for American intelligence analysts to detect any clear warning signs. “The coup in Mali progressed very rapidly and with very little warning,” said AFRICOM spokesman, Col. Tom Davis. “The spark that ignited it occurred within their junior military ranks, who ultimately overthrew the government, not at the senior leadership level where warning signs might have been more easily noticed.” [20] That view is strongly disputed. In an off-the-record interview with The New York Times, one Special Operations Forces officer disagreed, saying, “This has been brewing for five years. The analysts got complacent in their assumptions and did not see the big changes and the impacts of them, like the big weaponry coming out of Libya and the different, more Islamic fighters who came back.” [21]
More accurate it seems, AFRICOM had been “brewing” the crisis for five years since it began operations in late 2007. Mali for the Pentagon is but the next building block in the militarization of all of Africa by AFRICOM using proxy forces like France to do the dirty work. The Mali intervention using France upfront is but one building block in a project for the total militarization of Africa whose prime goal is not capturing strategic resources like oil, gas, uranium, gold or iron ore. The strategic target is China and the rapidly growing Chinese business presence across Africa over the past decade. The goal of AFRICOM is to push China out of Africa or at least to irreparably cripple her independent access to those African resources. An economically independent China, so goes thinking in various Pentagon offices or Washington neo-conservative think-tanks, can be a politically independent China. God forbid! So they believe.

Part V: AFRICOM Agenda in Mali: Target China

The Mali operation is but the tip of a huge African iceberg. AFRICOM, the Pentagon’s US Africa Command was signed into existence by President George W. Bush in late 2007. Its prime purpose was to counter the dramatically growing Chinese economic and political influence across Africa. Alarm bells went off in Washington in October 2006 when the Chinese President hosted an historic Beijing summit, the Forum on China-Africa Cooperation (FOCAC), which brought nearly fifty African heads of state and ministers to the Chinese capital. In 2008, ahead of a twelve-day eight-nation tour of Africa—the third such journey since he took office in 2003—Chinese President Hu Jintao announced a three-year, $3 billion program in preferential loans and expanded aid for Africa. These funds came on top of the $3 billion in loans and $2 billion in export credits that Hu announced earlier.
Trade between China and African countries exploded in the ensuing four years as French and US influence over the “Dark Continent” waned. China’s trade with Africa reached $166 billion in 2011, according to Chinese statistics, and African exports to China – primarily resources to fuel Chinese industries – rose to $93 billion from $5.6 billion over the past decade. In July 2012 China offered African countries $20 billion in loans over the next three years, double the amount pledged in the previous three-year period. [22]
For Washington, making AFRICOM operational as soon as possible was an urgent geopolitical priority. It began operation on October 1, 2008 from headquarters in Stuttgart, Germany. Since the Bush-Cheney Administration signed the directive creating AFRICOM in February 2007, it has been a direct response to China’s successful African economic diplomacy.
AFRICOM defines its mission as follows: “Africa Command has administrative responsibility for US military support to US government policy in Africa, to include military-to-military relationships with 53 African nations.” They admit working closely with US Embassies and State Department across Africa, an unusual admission which also includes with USAID: “US Africa Command provides personnel and logistical support to State Department-funded activities. Command personnel work closely with US embassies in Africa to coordinate training programs to improve African nations’ security capacity.” [23]
Speaking to the International Peace Operations Association in Washington, D.C. on Oct. 27, 2008 General Kip Ward, Commander of AFRICOM defined the command’s mission as, “in concert with other US government agencies and international partners, [to conduct] sustained security engagements through military-to-military programs, military-sponsored activities, and other military operations as directed to promote a stable and secure African environment in support of US foreign policy.” [24]
Various Washington sources state openly, AFRICOM was created to counter the growing presence of China in Africa, and China’s increasing success, to secure long-term economic agreements for raw materials from Africa in exchange for Chinese aid and production sharing agreements and royalties. By informed accounts, the Chinese have been far shrewder. Instead of offering savage IMF-dictated austerity and economic chaos as the West has, China is offering large credits, soft loans to build roads and schools in order to create good will.
Dr. J. Peter Pham, a leading Washington insider and an advisor of the US State and Defense Departments, states openly that among the aims of the new AFRICOM, is the objective of, “protecting access to hydrocarbons and other strategic resources which Africa has in abundance … a task which includes ensuring against the vulnerability of those natural riches and ensuring that no other interested third parties, such as China, India, Japan, or Russia, obtain monopolies or preferential treatment.”
In testimony before the US Congress supporting creation of AFRICOM in 2007, Pham, who is closely associated with the neo-conservative think-tank, Foundation for Defense of Democracies, stated:
This natural wealth makes Africa an inviting target for the attentions of the People’s Republic of China, whose dynamic economy, averaging 9 percent growth per annum over the last two decades, has an almost insatiable thirst for oil as well as a need for other natural resources to sustain it. China is currently importing approximately 2.6 million barrels of crude per day, about half of its consumption;…roughly a third of its imports come from African sources…perhaps no other foreign region rivals Africa as the object of Beijing’s sustained strategic interest in recent years…
… many analysts expect that Africa—especially the states along its oil-rich western coastline—will increasingly becoming a theatre for strategic competition between the United States and its only real near-peer competitor on the global stage, China, as both countries seek to expand their influence and secure access to resources. [25]
To counter the growing Chinese influence across Africa Washington has enlisted the economically weak and politically desperate French with promises of supporting a French revival of its former African colonial empire in one form or another. The strategy, as becomes clear in the wake of the French-US use of Al Qaeda terrorists to bring down Ghaddafi in Libya and now to wreak havoc across the Sahara from Mali, is to foster ethnic wars and sectarian hatred between Berbers, Arabs, and others in North Africa—divide and rule.
It appears they have even co-opted an earlier French blueprint for direct control. In a groundbreaking analysis, Canadian geopolitical analyst and sociologist, Mahdi Darius Nazemroaya writes, “The map used by Washington for combating terrorism under the Pan-Sahel Initiative says a lot. The range or area of activity for the terrorists, within the borders of Algeria, Libya, Niger, Chad, Mali, and Mauritania according to Washington’s designation, is very similar to the boundaries or borders of the colonial territorial entity which France attempted to sustain in Africa in 1957. Paris had planned to prop up this African entity in the western central Sahara as a French department (province) directly tied to France, along with coastal Algeria.” [26]
The French called it the Common Organization of the Saharan Regions (Organisation commune des regions sahariennes, OCRS). It comprised the inner boundaries of the Sahel and Saharan countries of Mali, Niger, Chad, and Algeria. Paris used it to control the resource-rich countries for French exploitation of such raw materials as oil, gas, and uranium.
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French map of Sahara in 1958 compared with USAFRICOM Pan-Sahal Initiative map (below) of terror threat in Sahara today.
Source: GlobalResearch.ca)
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He adds that Washington clearly had this energy-rich and resource-rich area in mind when it drew the areas of Africa that need to be “cleansed” of alleged terrorist cells and gangs. At least now AFRICOM had “a plan” for its new African strategy. The French Institute of Foreign Relations (Institut français des relations internationals, IFRI) openly discussed this tie between the terrorists and energy-rich areas in a March 2011 report. [27]
The map used by Washington for combating terrorism under the Pentagon Pan-Sahel Initiative shows an area of activity for the terrorists, inside Algeria, Libya, Niger, Chad, Mali, and Mauritania according to Washington’s designation. The Trans-Saharan Counterterrorism Initiative (TSCTI) was begun by the Pentagon in 2005. Mali, Chad, Mauritania, and Niger were now joined by Algeria, Mauritania, Morocco, Senegal, Nigeria, and Tunisia in a ring of military cooperation with the Pentagon. The Trans-Saharan Counterterrorism Initiative was transferred to the command of AFRICOM on October 1, 2008. [28]
The Pentagon map is remarkably similar to the boundaries or borders of the colonial territorial entity which France attempted to sustain in Africa in 1957. Paris had planned to prop up this African entity in the western central Sahara as a French department (province) directly tied to France, along with coastal Algeria—the Common Organization of the Saharan Regions (Organisation commune des regions sahariennes, OCRS). It comprised the inner boundaries of the Sahel and Saharan countries of Mali, Niger, Chad, and Algeria. The plans were foiled during the Cold War by the Algerian and other African countries’ independence wars against French colonial rule, France’s “Vietnam.” France was forced to dissolve the OCRS in 1962, because of Algerian independence and the anti-colonial mood in Africa. [29] The neo-colonial ambitions in Paris however, did not vanish.
The French make no secret of their alarm over growing Chinese influence in former French Africa. French Finance Minister Pierre Moscovici stated in Abidjan last December that French companies must go on the offensive and fight the growing influence of rival China for a stake in Africa’s increasingly competitive markets. “It’s evident that China is more and more present in Africa…(French) companies that have the means must go on the offensive. They must be more present on the ground. They have to fight,” Moscovici stated during a trip to Ivory Coast. [30]
Clearly Paris had in mind a military offensive to back the economic offensive he foresaw for French companies in Africa.
Notes
[1] James Kirkup, David Cameron: North African terror fight will take decades, The Telegraph, London, 20 January 2013.
[2] Thierry Meyssan, Mali: One war can hide another, Voltaire Network, 23 January 2013.
[3] Staff Sgt. Nathanael Callon United States Air Forces in Europe/Air Forces Africa Public Affairs, US planes deliver French troops to Mali, AFNS, January 25, 2013.
[4] S. Alambaigi, French Defense Minister: 2000 boots on ground in Mali, 19 January 2013.
[6] Christian v. Hiller, Mali’s hidden Treasures, April 12, 2012, Frankfurter Allgemeine Zeitung.
[7] Sources include private discussion with retired US military active in Africa.
[8] William Thornberry and Jaclyn Levy, Al Qaeda in the Islamic Maghreb, CSIS, September 2011, Case Study No. 4.
[9] Pepe EscobarHow al-Qaeda got to rule in Tripoli, Asia Times Online, August 30, 2011.
[10] Ibid.
[12] Craig Whitlock, Leader of Mali military coup trained in U.S., March 24, 2012, The Washington Post.
[13] Thierry Meyssan, op. cit.
[15] Thierry Meyssan, op. cit.
[16] Cheick Dioura and Adama Diarra, Mali Rebels Assault Gao, Northern Garrison, The Huffington Post, Reuters.
[17] Frank E. Kitson, Low Intensity Operations: Subversion, Insurgency and Peacekeeping, London, 1971, Faber and Faber.
[18] C.M. Olsson and E.P. Guittet, Counter Insurgency, Low Intensity Conflict and Peace Operations: A Genealogy of the Transformations of Warfare, March 5, 2005 paper presented at the annual meeting of the International Studies Association.
[19] Grant T. Hammond, Low-intensity Conflict: War by another name, London, Small Wars and Insurgencies, Vol.1, Issue 3, December 1990, pp. 226-238.
[20] Defenders for Freedom, Justice & Equality, US Hands Off Mali An Analysis of the Recent Events in the Republic of Mali,. MRzine, May 2, 2012.
[21] Adam Nossiter, Eric Schmitt, Mark Mazzetti, French Strikes in Mali Supplant Caution of US, The New York Times, January 13, 2013.
[22] Joe Bavier, French firms must fight China for stake in Africa—Moscovici,, Reuters, December 1, 2012.
[23] AFRICOM, US Africa Command Fact Sheet, September 2, 2010.
[24] Ibid.
[26] Mahdi Darius Nazemroaya and Julien Teil, America’s Conquest of Africa: The Roles of France and Israel, GlobalResearch, October 06, 2011.
[27] Ibid.
[28] Ibid.
[29] Ibid.
[30] Joe Bavier, Op. cit.

Fall on Hard Times, Have Your Kids Taken Away? How America Treats Poor Parents Like Criminals

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Shakieta Smith needed a place to go. The homeless mother of two called a Washington, DC shelter hotline last year, but was told there were no available spaces. Then the intake worker told her that “if she and her kids had nowhere safe to sleep, she’d be reported to the city’s Child and Family Services Agency for a possible investigation into abuse and neglect,” the Washington Post reported. [4]

Smith is not the only mother to fear having her children taken away and put into foster care due to homelessness. According to the Post, 32 other families in DC have been threatened in a similar way. And about 25 states in the country “list a caregiver’s inability to provide shelter as part of their definition of abuse and neglect,” though some of those laws have been challenged in court. It’s yet another heartwrenching reminder of the myriad legal troubles that accompany being poor and homeless.

“These people are simply walking in the door for assistance and people don’t have shelter and they’re saying, ‘We’re calling [Child Protective Services] on you?' It’s ridiculous,” homeless advocate Ruth Anne White told the Post.

According to the National Center on Family Homelessness, “homeless children are at particularly high risk for being placed in foster care. 12% of homeless children are placed in foster care compared to just over 1% of other children.” 
The center also notes that “placement in foster care” is a “risk factor” that predicts family homelessness during adulthood.

Poverty expert Kathryn Baer relayed a story she was told by a father at Washington, DC’s main intake center for homeless families. The father told her he was afraid of having his children taken away. “I think of him now because the Family Resources Center has started reporting all homeless families with no place to stay to the Child and Family Services Agency, the District’s child welfare program,” wrote Baer in May 2012. [5] “This means that the parents can be charged with child neglect — and their children put into foster care — just because the District won’t provide them with shelter or other housing.”
This is despite the fact that DC law stipulates that “deprivation” due to lack of financial means is not considered neglect.

Homeless advocate Diane Nilan, the founder and president of HEAR US, an advocacy organization for homeless youth, has also seen this happen firsthand. “The foster care cloud hangs over every single homeless family that is out there. They, on their own, figure out that homelessness can likely get the kids taken away. So that fear, it’s a big dark cloud,” Nilan told AlterNet.

But it doesn’t have to be this way. What if, instead of investigating and intimidating homeless families, we ensured they have a place to go when they fall on hard times?
As the story of Shakieta Smith shows, a core problem driving this process is that there are not enough shelters for all the homeless families. Cities should spend more money on building more shelters and expanding already existing shelters. And federal housing vouchers for homeless families could be expanded to get families into real, permanent housing. As the National Alliance to End Homelessness states [6], “Housing vouchers are successful in helping families exit homelessness and can protect poor families from becoming homeless.”

Advocates have also called for a more holistic approach to solving the problem of homelessness, so that a shelter is not a way station on the way to more poverty and future homelessness once they’re out of the shelter system. Ralph da Costa Nunez, the president of Homes for the Homeless, offers some important solutions in his bookA Shelter Is Not a Home...Or Is It? Lessons From Family Homelessness in New York City.
“Shelters should include education and GED preparation, mentoring and skill building, and job internships and actual employment, both on-site and in the community,” he writes. And as an alternative to children spending time in the foster care system, Nunez advocates for “shelter crisis nurseries, which provide twenty-four hour, seven-day a week temporary placements for children at risk of abuse or neglect. Parents deal with emergencies and sort out stressful situations that put their child at risk, and a whole new way of handling crises is learned. Through after-care and support services, crisis nursery staff work with each family to ensure their long-term stability, keeping families together in a safe nurturing environment.” 
And Nunez also points out that these “shelter crisis nurseries” would benefit the public. “a foster care placement can cost up to $40,000 per child annually, while the annual cost of the shelters’ crisis service is approximately $750 per child.”
Going to Jail for an Education 
Having their kids taken away is not the only punitive measure homeless parents face as they struggle to find housing. One of the most difficult things about not having a permanent place to live is ensuring that their kids continue going to school. Some districts have chosen to make this even tougher. 

Homeless expert Diane Nilan has seen firsthand how homeless mothers are threatened with having their children taken away if they try to enroll their kids in the wrong school district. In one case in the Chicago suburbs, Nilan advocated for a homeless mother the local school district suspected of lying in regards to where she lived. The district hired a private investigator and brought in lawyers to prove their suspicion, but they ended up being wrong about the homeless mother. “In an affluent district, this was their first-ever homeless student. I think they were quite shocked that they had one and didn’t want to tarnish their record,” explained Nilan.

“The school district brought in big lawyers and investigators,” Nilan told AlterNet, spending a lot of money that was eventually all for nothing since the mother was innocent.
“Here’s a parent trying to find a place to live, has a lot of other things going on, and to have a school district breathe fire at them, it really can set off a negative attitude towards authority and school districts. It doesn’t do anyone any good...The residency cops that are out there can really scare a parent.”

Beyond this specific case, there are other barriers to education for homeless youth. “Homelessness has a devastating impact on homeless children and youth’s educational opportunities. Residency requirements, guardianship requirements, delays in transfer of school records, lack of transportation, and lack of immunization records often prevent homeless children from enrolling in school,” according to the National Coalition for the Homeless.

Yet another case is that of 33-year-old Tonya McDowell, who wanted her son to go to a decent elementary school. But that desire also landed McDowell in a heap of legal trouble. Her case became a symbol of how the poor and homeless can be arrested just for trying to get their children a decent education. It also speaks to the wide gaps in educational quality between high-income and low-income areas; some poor people decide that lying to get their kid into a good school is worth the risk.

In April 2011, McDowell made nationwide headlines when she was arrested for trying to send her son to school in Norwalk, Connecticut. The problem was that McDowell did not live within the Norwalk school district area. She was homeless, and her last known address was in Bridgeport, CT. In the course of trying to get her son a decent education, she ran afoul of a system that makes no room for the homeless.

McDowell was charged with “stealing more than $15,000 for the cost of her child's education,” according to the Stamford Advocate. Her predicament sparked the ire of civil rights and anti-poverty advocates. “The NAACP doesn't like that they're trying to attack somebody who's poor and doesn't have a good support system,” said Scot Esdaile, a spokesperson with the civil rights group. In February 2012, McDowell was found guilty on charges of fraudulently enrolling her son in the wrong school district and was also found guilty of selling narcotics, which stemmed from a separate arrest. The next month, McDowell was sentenced to five years in prison. [7] It’s also important to note that “McDowell's babysitter, Ana Rebecca Marques, was also evicted from her Roodner Court public housing apartment for providing documents to enroll the child at Brookside Elementary School [8],” according to the Stamford Advocate.

While cases like McDowell’s are relatively rare, they are striking examples of how low-income people are criminalized. Low-income people want the same things that every other American wants, including a decent education for their children. But sometimes, they’re treated as criminals for doing so.

The case of Kelley Williams-Bolar is another example. In January 2011, Williams-Bolar was “convicted of tampering with records to enroll her children in a better school district,” according to CNN. [9]

“Kelley Williams-Bolar, 40, of Akron, illegally registered her two daughters at her father's address in suburban Copley Township to get them into the Copley-Fairlawn school district [10] rather than the urban Akron district [11], a jury decided,” the news outlet reported. As a result of her conviction, “she had to perform 80 hours of community service and pay $800 in restitution, as well as the cost of Summit County’s prosecution against her,” according to ColorLines. [12]

And just like there are solutions to the problem of putting homeless kids in foster care, there are solutions to prevent homeless families from getting into legal trouble because they want their children enrolled in a good school district. An immediate solution is to change the laws that fuel the harassment homeless families can experience if they try to skirt around residency requirements. Being homeless should not deny children a decent education; strict residency requirements can be made more flexible to accommodate homeless families. States should discourage their local school districts from turning to the criminal justice system to deal with a residency dispute.

Another short-term solution is to enforce the laws on the books already. “The basic solution lies in the families, the students, the youth, having information about what their legal rights are,” noted HEAR US’ Nilan. For example, under the McKinney-Vento Homeless Education Act, school districts must enroll homeless children and must also develop policies to remove barriers to enrollment by homeless children.

Under current law, “there’s a system set up so that if the school district is trying to challenge [a homeless children’s enrollment], each state has a dispute resolution process that has been approved by the feds and is supposed to quickly solve whatever questions there are,” said Nilan. “The problem is people need to know about this.”
At the root of the problem is America's vastly inequitable education system. School districts in poor areas are routinely shortchanged--and that’s even according to the U.S. Department of Education.
“Schools serving low-income students are being shortchanged because school districts across the country are inequitably distributing their state and local funds,” reads a press release put out by the department [13] highlighting a report on the topic. A more equitable education system would go a long way toward relieving the pressure on all low-income families who know they’re sending their children to schools that don’t have the proper resources. And it would be especially helpful to homeless families who reject that because they’re homeless, their kids' education should be circumscribed.