Monday, December 7, 2009

Dubai gone bust

You know about Dubai's economic crisis. But do you know the background to - and fallout from - the crisis?

A Brief History

Historically, Dubai had an oil-based economy.

But because Dubai's oil reserves were declining, the government - led by Sheikh Muhammed Al Maktoum - decided to diversify into other areas, especially tourism and commerce (approx. 30-40% of the total economy).

That's why Dubai built the world's only 7 star hotel, a series of luxury islands, and the world's largest tower to name a few.

But the global property bubble burst; housing bubbles burst in China, France, Spain, Ireland, the United Kingdom, Eastern Europe, and many other regions.

And the bubble in commercial real estate is also bursting world-wide.

But Dubai got hit the hardest.
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As Bloomberg notes:

Dubai suffered the world’s steepest property slump in the global recession, with home prices dropping 50 percent from their 2008 peak, according to Deutsche Bank AG.

As the CBC notes, things went South quickly in Dubai:

Hundreds of billions of dollars worth of building projects were delayed or cancelled. Thousands of jobs disappeared.

Dubai, playground of the über-extravagant, suddenly found itself facing the very real possibility that its biggest state-owned company, Dubai World, could go into bankruptcy. It warned it was having trouble making debt payments on $59 billion (speculated to be actually twice as much) — money borrowed to pay for all the excess.

Global Impact

Not to mention that that Dubai World has holdings worldwide; Dubai World is Dubai's main holding and investment enterprise, but its holdings range far beyond the Persian Gulf area ...

Another Dubai World holding — DP World — operates Centerm, a container terminal in Vancouver's inner harbour. DP World acquired the terminal when it bought the marine terminal assets of P&O Ports in 2006, and plans to spend $140 million to expand it.

That purchase also gave it ownership of many key U.S. ports — something that raised national security concerns in the U.S. Some American legislators didn't like the idea that U.S. ports would be controlled by Middle Eastern state-owned enterprises. DP World subsequently "sold" its U.S. port assets.

In Britain, another Dubai World subsidiary, Leisurecorp, bought the Turnberry Resort in Scotland in 2008 — home to the 2009 British Open — for more than 50 million pounds.

In the U.S., Dubai World's investment arm, Istithmar World, bought the luxury retailer Barneys New York in 2007 for almost $1 billion US. There were reports earlier this year it was trying to unload the retailer as the luxury market unwound and Istithmar racked up big losses from the global financial meltdown, but Dubai World's chair denied it.

In addition, Bloomberg notes that India might be effected by Dubai's economic problems. About 4.5 million Indians live and work in the Gulf region and remit more than $10 billion annually, according to government data. The turmoil may affect remittances, said Thomas Issac, finance minister of the southern state of Kerala, which accounted for about a quarter India’s migrant labor in 2005; remittances from the Middle East account for about 25 percent of Kerala’s economy, Issac said.

The Royal Bank of Scotland is Dubai's biggest creditor, with $2.3 billion, or 17 percent, of Dubai World loans since January 2007. HSBC, Europe’s biggest bank, has the “largest absolute exposure” in the U.A.E. with $17 billion of loans in 2008

Yves Smith notes that Dubai's default caught creditors by surprise:

"I got a message from someone who was on the conference call [with Dubai government officials]... Some European banks may be on the wrong side of this trade. As readers may know, EuroBanks went into the crisis with even lower capital levels than their US counterparts, and have taken fewer writedowns of their dodgy exposures".

The standstill announcement…was a massive surprise. One could sense the panic in those asking questions. This could be the turning point in spreads and could be viewed similar to the Russian debt crisis in 1998 or the Bear situation in 2007...based on companies and the accents of the people asking questions, it is obvious European institutions will be hit hard...Dubai made this announcement at the beginning of a four day holiday, so there will be little news until next week...There is another wave of pain out there. This information does not seem to be making its way to other markets. It will.

Zero Hedge has a good roundup of statistics regarding the biggest creditors of the United Arab Emirates, of which Dubai is a part:


Creditors of United Arab Emirates

By Origin via Credit Suisse citing Bank for International Settlements:

United Kingdom: $50.2 billion
France: $11.3 billion
Germany: $10.6 billion
United States: $10.6 billion
Japan: $ 9.0 billion
Switzerland: $ 4.6 billion
Netherlands: $ 4.5 billion

By Entity via Credit Suisse, citing Emirates Bank Association:

HSBC Bank Middle East Limited: $17.0 billion
Standard Chartered Bank: $ 7.8 billion
Barlays Bank Plc: $ 3.6 billion
ABN-Amro (RBS): $ 2.1 billion
Arab Bank Plc: $ 2.1 billion
Citibank: $ 1.9 billion
Bank of Baroda: $ 1.8 billion
Bank Saderat Iran: $ 1.7 billion
BNP Parabas: $ 1.7 billion
Lloyds: $ 1.6 billion

Bloomberg notes that Dubai's default might increase risk aversion of investors to emerging markets:

"We’re bound to see a rise in risk aversion," Arnab Das, the London-based head of market research and strategy at Roubini Global Economics said in an interview. "The Dubai situation signifies that although the major central banks around the world have stabilized the financial system, they can’t make all the excesses simply disappear."

India’s stocks, currency and bonds fell on concern investors may shy away from riskier emerging market assets over losses stemming from the turmoil in Dubai. India’s benchmark stock index dropped recently, while the rupee lost some percent as well.

Zero hedge also notes:

UBS speculates that (among other possibilities) $80-90 billion (which is already over 100% of GDP) may be a low figure for Dubai's debt and that significant "off-balance sheet" amounts might explain the restructuring attempt.

Abu Dhabi's Sovereign Wealth Fund (generally thought to command upwards of $500 billion) may have significantly less available. (Rumors of $125 billion in 2008 losses abounded last year). Bloomberg quotes sources to the effect that Abu Dhabi SWF's AUM has been "overstated, sometimes by as much as 100 percent."

British prime minister Gordon Brown has indicated how serious the situation is:

"Clearly the restructuring announcement has caused disruption and uncertainty in world markets," Brown’s spokeswoman Vickie Sheriff told reporters in London. Brown’s "view is that U.K. banks are well capitalized having undergone rigorous stress testing," she said.

And the Associated Press is asking whether Dubai's default will cause another financial panic.

The numbers involved are not that great for most creditors - on the order of hundreds of millions of dollars.

But the sense of shock and loss of confidence - when many had optimistically believed that the world economy was out of the woods - could indeed be profound.

Monday, November 16, 2009

Plea to you

You have an obligation to every last victim of your illegal aggression, because all of this carnage has been done in your name.

Since World War II, 90 percent of the casualties of war are unarmed civilians, a third of them children. Your victims have done nothing to you. From Palestine to Afghanistan to Iraq to Somalia to wherever your next target may be, their murders are not collateral damage. They are the nature of modern warfare.

They don't hate you because of your freedoms. They hate you because every day, you are funding and committing crimes against humanity.
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The so-called war on terror is a cover for your military aggression to gain control of the resources of Western nations. This is sending the poor of this country to kill the poor of those Muslim countries. This is trading blood for oil. This is genocide, and to most of the world, you are the terrorists.

In these times, remaining silent about your responsibility to the world and its future is criminal, and in light of your complicity in the supreme crimes against humanity in Iraq and Afghanistan and ongoing violations of the UN charter and international law, how dare any American criticize the actions of legitimate resistance to illegal occupation? How dare you condemn anyone else's violence?

Your so-called enemies in Afghanistan, Iraq, Palestine and your other colonies around the world, and your inner cities here at home are struggling against the oppressive hand of empire, demanding respect for their humanity. They are labeled insurgents or terrorists for resisting rape and pillage by the white establishment, but they are your brothers and sisters in the struggle for justice.

The civilians at the other end of your weapons don't have a choice. But American soldiers have choices, and while there may have been some doubt five years ago, today, we know the truth. Your soldiers don't sacrifice for duty, honor and country. They sacrifice for Kellogg, Brown and Root. They don't fight for America--they fight for their lives and their buddies beside them because you put them in a war zone.

They're not defending your freedoms--they are laying the foundations for 14 permanent military bases to defend the freedoms of ExxonMobil and British Petroleum. They're not establishing democracy, they're establishing the basis for an economic occupation to continue after the military occupation has ended.

Iraqi society today, thanks to American help, is defined by house raids, death squads, checkpoints, detentions, curfews, blood in the streets and constant violence. You must dare to speak out in support of the Iraqi people, who resist and endure the horrific existence you brought upon them through your bloodthirsty imperial crusade.

You must dare to speak out in support of the American war resisters--the real military heroes, who uphold their oath to defend the Constitution of the United States against all enemies, foreign and domestic, including those terrorist cells in Washington, D.C., more commonly known as the legislative, executive and judicial branches.

Frederick Douglass said: "Those who profess to favor freedom and yet deprecate agitation are men who want crops without plowing up the ground, they want rain without thunder and lightning. They want the ocean without the awful roar of its mighty waters.

"The struggle may be a moral one, or it may be a physical one, and it may be both moral and physical, but it must be a struggle. Power concedes nothing without a demand. It never did, and it never will."

Every one of you must keep demanding, keep fighting, keep thundering, keep plowing, keep speaking and keep struggling until justice is served. No justice, no peace.

Tuesday, October 27, 2009

The Pharmaceutical Industrial Complex: A Deadly Fairy Tale

It has been a particularly bad month for the pharmaceutical industrial complex in its ongoing litigations in American courts. Among the main pharmaceutical headlines, Merck’s Gardasil vaccine for HPV, now being widely administered to pre-teens, was found to be linked to amyltrophic lateral sclerosis, commonly known as Lou Gehrig’s disease; following a $1.4 billion fine in promoting one of its blockbuster drugs Zyprexa off-label, deceptive correspondence was uncovered by Eli Lilly gaming the system again by promoting another one of its drugs, Cymbalta, off-label for fibromyalgia; AstraZeneca was fined $160 million for scamming the Medicaid system in Kentucky after being fined $215 million for ripping off Alabama; Glaxo lost a Pennsylvania trial for failing to warn doctors and pregnant women of the dangers of its antidepressant drug Paxil related to birth defects; and Pfizer scored a record-breaking fine of $2.3 billion for illegally marketing several drugs over the years: Bextra, Zyvox, Geodon and Lyrica. These kinds of charges, among the many others, have become a habit for drug makers for the past dozen years.

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When we speak of the pharmaceutical industry complex, it does not refer solely to private drug manufacturers. The complex, like a Matrix that holds captive the health of the nation in medical slavery by its own design and manipulation, is a consortium, a spiders’ web woven with financial attachments throughout the medical profession. In addition to the pharmaceutical and medical device firms, this complex includes every government health agency—the Food and Drug Administration (FDA), the Centers for Disease Control (CDC), the National Institutes of Health (NIH), and or course the Department of Health and Human Services (HHS)—as well as drug lobbying firms now employing a large number of former Congresspersons, insurance and HMO companies, all of the leading professional medical associations such as the American Medical Association (AMA) and the American Psychiatric Association (APA), the majority of medical schools and their research departments who are heavily funded by drug money, many of the most prestigious medical journals, and ultimately all of this filtering downward to the physicians who diagnose our illnesses and prescribe our medications and treatments.

America is rightly regarded as having led much of the world in many qualitative innovations in all fields. That reputation is duly deserved. However, there is a new dynamic at work that is causing this reputation to be challenged. We are a nation that prides itself in our humanity, our sense of fairness, but today there is a growing concern that we are now being monikered as a country held hostage to a national security complex, which includes the largest military complex in the world, an obscenely expensive healthcare system and self-serving bureaucracies and private industries that serve their own financial ends. So it is not surprising that after spending this year $2.6 trillion on healthcare, we have such little health to show for it. There are second world countries where people live longer and healthier lives. And we have the worst healthcare among developed nations. So what have we received for our $2.6 trillion.

As the current healthcare debate continues to rage over in sundries—the $200 billion net profit health insurance industry—the entire deliberation over disease prevention and treatment has been overshadowed. And amidst this partisan and ideological anarchy, perpetuated by our elected officials, the media, and fueled by the pharmaceutical complex, two other areas America excels as a leader above all other developed nations is in being the premier breeding ground for the pharmaceutical industrial complex’s greatest profits and, second, as the world’s exemplar in medical fraud and corruption. The fairy tale of America’s health as being best served by drugs is a creation of this complex, a lullaby that brings ill citizens repeatedly to their doctors and hospitals for diagnosis and treatment, or simply to deny healthcare altogether to the uninsured.

The country is pacified by a blind belief that the drugs being prescribed to them have been proven safe because our government health agencies have our physical health and well-being in their best intentions. This is a lie, an extraordinarily deadly lie. Iatrogenesis, medically induced injury and death, is the number one cause of death in American medicine annually, since only a small percentage of these deaths are actually reported. Each year more Americans die from preventable deaths due to our medical system than all military causalities in the two world wars combined. This is tantamount to medical genocide. One of the major causes of these deaths is the overmedication of Americans in all ages. The constant need for profits has created an environment that allows the pharmaceutical industrial complex to use their enormous financial and political clout to literally make normal life experiences into new diseases, such as social anxiety disorder, in order to sell its drugs. The pharmaceutical industry has been given the authority to pathologize life, with the drugging of our children, seniors, etc. For example, the leading cause of AIDS deaths today is a result of liver failure. This is not a condition of HIV infection, but a direct result of the anti-HIV drug AZT. Is it little wonder then that we are being intimidated and frightened into believing that mandatory vaccination is being touted even though the science of efficacy and safety, even the need, for these new swine flu vaccines is patently unproven. It is perhaps one of the largest falsehoods ever perpetuated on humanity that dwarfs the sleaze on Wall Street.

If any one of us committed manslaughter, we would be behind bars instead of walking a crimson carpet into the offices of our elected officials in the Congress and Senate or past the gates guarded by the nation’s Cerberus, Rahm Emmanuel, to lobby the White House. Yet if we are a pharmaceutical executive, or a lobbyist representing a drug company who has collected a litany of charges including medical fraud, criminal salesmanship, gaming the insurance industries, repeated lying to federal officials, and manipulation of data regarding life-threatening adverse effects of drugs that have killed so many people, we can walk away with a fine, a surge in the stock market after a settlement, a financial bonus, and the personal satisfaction in not having to apologize so we can continue business as usual. This is the power the pharmaceutical industrial complex possesses and its usurped right to distain every noble principle in the Hippocratic Oath that every physician dedicates her or himself to live by, “That I will exercise my art solely for the cure of my patients, and will give no drug and perform no operation for a criminal purpose.”

Every American who is prescribed a drug by a physician has the belief that that pill has undergone rigorous trials to scrutinize its safety. And when there are known potential adverse effects, we blindly assume these are known to the attending physician. However, this is a myth perpetuated not only by drug makers, but by our own federal health agencies. A 2003 investigation published in The Independent in the UK reported that “under pressure from the pharmaceutical industry, the FDA routinely conceals information it considers commercially sensitive, leaving medical specialists unable to assess the true risks [of approved drugs].” One case involved a very popular over-the-counter drug, the painkiller ibuprofen. The investigators’ search uncovered concealed data showing that ibuprofen increased heart attack risks by 25 percent. Even Freedom of Information (FOI) filings to the FDA do not produce all the information being requested. For example, a group of Swiss investigators filed an FOI to procure trial data about the musculoskeletal pain drug Celecoxib and received back only 16 of the 27 trials conducted on it. A separate FOI concerning a similar drug, Valdecoxib, had pages and paragraphs deleted because sections of the document were marked as “trade secrets.” An even worse case involving a leaked report concerning internal memos and secret FDA reports provided detailed evidence that the FDA approved 9 different antidepressants, representing a total of 22 studies enrolling 4,250 children, while knowing full well that the risk of “suicide-related events” was twice as high as children taking a placebo. These are just several examples among numerous others.

The pharmaceutical industrial complex is perhaps the largest, most influential cartel in the world. This becomes evident after considering the billions of dollars and other currencies drug companies have been forced to pay for a wide variety of corruption charges. Our analysis of 724 legal settlements from a random sampling among the over one hundred thousand by pharmaceutical corporations totally $87 billion is just a small indication about how pervasive Big Pharma’s criminality since the vast majority of settlements are concluded outside of court and remain confidential.

It is extremely difficult to comprehend why the United States principle federal health agencies, particularly the FDA and National Institutes of Health (NIH), with the specific mandate to provide oversight on all pre-approved drug applications and delegated with the task to assure drugs are safe or at least specify clearly their known dangers, are so reprehensible and inept. There is only one rational answer and that is the pharmaceutical industry is the FDA’s largest client, and this relationship goes much deeper than the FDA functioning as an objective regulator investigating pharmaceutical products before being released upon the American population. It is not to far afield to suggest that as it stands now the US regulatory agencies are an extension of corporate America.

As serial offenders of product safety cover-ups for over a decade, drugs have injured and killed millions. In the case Merck’s Vioxx, this one drug has killed 44,000 people and injured 120,000 others. Only in America could you kill 44,000 and not go to jail and get a raise. Should we assume, therefore, that the pharmaceutical complex should be trusted without challenge? We have also been asked to believe that the manufacturers were guided by a sense of public service. But when examining the top ten drugs sold, the facts reveal otherwise. In one example, manufacturers marked up a drug an astounding 500,000% over its equivalent generic version. Six other drugs were marked up 2000%. Pharmaceutical companies make profits higher than oil companies.

Big Pharma’s impact is felt almost everywhere. But nowhere is it felt more than in the legal system. In a recently concluded, short-term study, we found 724 cases involving Big Pharma in which either the case ended in a verdict against the pharmaceutical company or the company settled. The number of cases is staggering, as are the dollar amounts. These cases cover practically every type of civil and criminal case. From products that kill, harm and maim, to false claims, to not paying taxes, to patent infringements, to bribery, to publishing false scientific journals. Yet, in spite of the tens of thousands of lawsuits won against Big Pharma, it still conducts business as usual.

Eli Lilly flooded state Medicaid programs with Zyprexa: its superstar, antipsychotic drug. In 2003, worldwide sales of Zyprexa grossed $4.28 billion, amounting to almost one third of Lilly’s total sales. In the United States, during the same year, Zyprexa grossed $2.63 billion. A whopping 70 percent of these sales were directly related to government agencies—principally Medicaid. Fast-forward six years to 2009, Eli Lilly pleaded guilty for having illegally marketed Zyprexa for an unapproved use to treat dementia, and will pay $1.42 billion to settle civil suits and end the criminal investigation. Lilly agreed to pay $800 million to settle civil suits. It will pay $615 million to resolve the criminal probe, and plead guilty to a misdemeanor in violation of the Food, Drug and Cosmetic Act for promoting Zyprexa as a dementia treatment.

Did Lilly also know of the possibility that Zyprexa could cause diabetes, which was also kept concealed under the protection of the FDA? They most certainly did, which makes their behavior all the more reprehensible. In 2002, British and Japanese regulatory agencies issued a warning that Zyprexa may cause diabetes. In addition, even after the FDA issued a similar warning in 2003, Lilly did not pull Zyprexa from the market. This becomes all the more understandable after it is taken into consideration that Lilly is also the largest maker of diabetes medications.

An article by Mike Adams, the Natural News editor, states that Merck employees had a “hit list” of doctors they sought to “neutralize.” This allegation was confirmed when documents that had been secret were revealed during a Vioxx court case. The Australian revealed that the documents surfaced in the Federal Court in Melbourne and exposed the criminal intent of Merck employees who admitted they were going to “stop funding to institutions” and “interfere with academic appointments.” One Merck employee testified (about the doctors on the hit list), “We may need to seek them out and destroy them where they live.” Merck threatened or intimidated at least eight clinical investigators, testimony in court revealed. There are other, similar stories in which Merck deals with dissent by attempting to destroy the lives and careers of academics who don’t review their drugs favorably.

Merck is steeped in a well-documented record of criminality. Such actions include, but are not limited to, intentionally hiding the liver-damaging effects of its cholesterol drug, intentionally withholding the release of clinical data that revealed the failures of another cholesterol drug; it has dumped vaccine waste and manufacturing chemicals into water supplies; it opened up offshore banking accounts to avoid paying billions of dollars in U.S. taxes, and it was caught in a huge scheme of scientific fraud when it was discovered that the company used in-house writers to secretly write so-called “independent” studies that were published in peer-reviewed medical journals.

Under the Foreign Corrupt Practices Act, which the U.S. Department of Justice and the SEC enforce, it is illegal to bribe a foreign government official in order to obtain or retain business. Apparently, Bristol-Myers and Schering Plough were unaware of this law. According to the Associated Press, both drug makers were engaged in influencing government officials in Germany and Poland respectively.

Earlier this year, an article in the Boston Business Journal reported that a former drug company sales executive pleaded guilty in Boston federal court to telling the roughly 100 representatives she supervised that they should promote a pain drug for uses she knew had been rejected by the FDA. Bextra was the drug she pleaded guilty to inappropriately selling. Pfizer has since pulled it from the market. According to a press release from U.S. Attorney Michael Sullivan's office, “Holloway was aware of the FDA's safety concerns, but...she nonetheless had her sales staff of approximately 100 employees sells Bextra for precisely the uses that the FDA refused to approve.”

The pharmaceutical complex has also infiltrated the majority of American medical schools and medical research departments. A recent survey in the Journal of the American Medical Association discovered that 60% of academic department chairs have personal ties to industry (as consultants, board members, or paid speakers), while 66% of the academic departments had institutional ties to industry. Researchers who receive funding from drug and medical-device manufacturers are up to 3.5 times as likely to state their study drug or medical device works than are researchers without such funding.

In America, one can hardly turn on the television or pick up a newspaper without reading about the hot button issue of health care reform. Why such emotion? Why are, seemingly, rational people so intransigent and unwilling to budge from their positions? Could lobbyists have anything to do with this? According to OpenSecrets.org, there are 3093 lobbyists in the health field and Big Pharma now spends approximately $1.2 million daily to persuade Congress to act according to their script. An investigation conducted by Medical Verdicts & Law Weekly found that 30 key lawmakers are involved in health legislation totaling $11 million in health investments. Three of every four major health firms have at least one lobbyist who worked for a congressman. Startlingly, nine lobbyists employed by Big Pharma are former congressional staffers who are still well-connected to Capitol Hill. The conflicts of interest are everywhere. Judd Gregg (R-NH), the Obama nominee for Commerce Secretary, who withdrew because of opposition to the Administration's agenda, is a senior member of the Health Committee. He revealed that he has $254,000-$560,000 in health stocks."

In 2000, Mylan Labs settled a case for $100 million. What the numbers don’t tell you is the story behind the numbers. In 1998, Mylan raised the wholesale price of clorazepate, a generic tranquilizer, to $377.00 (for 500 tablets) from $11.36 in one year. This represents a 3000% increase on a generic drug.

It was subsequently revealed that Mylan conspired with the main manufacturer of the active, indispensible ingredient to have an exclusive agreement. The agreement prevented any other manufacturers from producing the drug, for without the active ingredient, the drug could not be made. Mylan’s deception was uncovered and it had to pay $100 million to settle an FTC antitrust case. But Mylan represents only an infinitesimal percentage of such examples. In all likelihood, the vast majority of similar cases remain undetected. The FDA’s under-regulation and erroneous oversight encourages this type of corruption.

Another case included in our study states, “TAP [Taketa-Abbott Pharmaceutical] Pharmaceutical Products Inc. -- $875,000,000 under the False Claims Act.” TAP agreed to pay $875 million to resolve criminal charges and civil liabilities in connection with its fraudulent drug pricing and marketing conduct regarding the drug Lupron, according to a press release from the Department of Justice. Lupron is used by male cancer patients to suppress the production of testosterone. Another drug worked as well, so to make Lupron the drug of choice for this condition, TAP played dirty by giving kickbacks to physicians prescribing the drug, thus ensuring its ridiculously high price would be maintained. Even though criminal indictments were filed against TAP Pharmaceutical officials, Lupron’s price remains overly inflated.

Ever wonder why Big Pharma would engage in all manner of illegal activity? In light of the steady stream of articles detailing how the elderly are oftentimes forced to choose between purchasing their medication and buying food, a good place to begin is to examine what it costs to make a drug and what Big Pharma sells it for. Life Extension magazine conducted an original investigative report in which it compared the actual price of a popular drug and how much the generic version of its active ingredients costs. Examine these figures:



In order to understand how we can spend 2.6 trillion this year on healthcare, but not reduce the incidence of cancer, heart disease, diabetes, obesity, mental conditions, arthritis, etc., we must realize this is a game. With each piece of the puzzle, feeding into a single picture of a massively corrupt, unethical, and frequently illegal system controlled by relatively few corporations within the pharmaceutical complex and the health insurance industry, are the ring leaders. They in turn influence thousands of lobbyists, paid-off scientists and academicians, and policymakers, especially those who rule on important health oversight committees. Health officials and legislators in turn solicit expert witnesses, preselected by the cartels, to position their drug agendas in the most favorable manner. The pharmaceutical cartel also has direct connections with its supporting scientific advisory boards and key foundations. These foundations, supported by policy think tanks who supply the so-called independent experts, then lobby the upper echelon within the FDA, NIH, CDC, NIMH, HHS. Ideally they hire former health commissioners and legislators previously players in the game to assist those same federal agencies to see their drugs guided through the regulatory process. Public relations and advertizing firms are contracted to give the public impression that these drugs are effective and safe for the sole reason they have received official licensing. In addition, the cartel creates front organizations with consumer-friendly titles whose representatives appear at national conferences and seminars beholden to special drug interests. Finally, the drug corporations set money aside to be paid out in settlements. With the exception of class action suits, the majority of cases for injury and death are accompanied by confidentiality clauses to prevent public disclosure of data the companies wish to remain secret.

This is how the medical system is rigged and it is why we can watch 60 Minutes or read the New York Times serving as pharmaceutical shills to encourage vaccination, yet refusing to air or print the dissenting voices who have the scientific evidence to show it is a massive fraud. Therefore, the public is misled every step of the way. Victims of injury, such as the tens of thousands of children, now at 1 in 91 children, with autism spectrum disorder, are forced to fend for themselves. Parents know far better than the FDA and CDC, when their perfectly normal child after a vaccination or a series of vaccines shortly thereafter is lost, withdrawn into the dark corners of autism. And yet the pediatrician and psychologist will say the child must have had a genetic defect. The CDC, FDA and NIH, with an orchestrated voice, say it is not the vaccine. Everyone within the pharmaceutical industrial complex denies the truth. Only now, during the healthcare debate, are we seeing clearly the rampant politics of the pharmaceutical and insurance industries. The veils are finally being removed. If it were not for the healthcare debacle, we might still not know how the game is rigged and why our politicians and health officials will not tolerate any real reform and accountability at any level.

If we want to clean up American medicine, the corporate shield must be removed and politicians, health officials and pharmaceutical executives must be held accountable. If they are threatened with jail time for manslaughter by pushing dangerous drugs, then we will see less life-threatening drugs go to market.

We are in a perfect storm without a life raft. We much take back our freedoms of choice and demand legal accountability or nothing will change.

by Dr. Doug Henderson and Dr. Gary Null

Marx and Lenin Revisited

“Capital is dead labor, which, vampire-like, lives only by sucking living labor, and lives the more, the more labor it sucks.” Karl Marx

If Karl Marx and V. I. Lenin were alive today, they would be leading contenders for the Nobel Prize in economics.

Marx predicted the growing misery of working people, and Lenin foresaw the subordination of the production of goods to financial capital’s accumulation of profits based on the purchase and sale of paper instruments. Their predictions are far superior to the “risk models” for which the Nobel Prize has been given and are closer to the money than the predictions of Federal Reserve chairmen, US Treasury secretaries, and Nobel economists, such as Paul Krugman, who believe that more credit and more debt are the solution to the economic crisis.

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In this first decade of the 21st century there has been no increase in the real incomes of working Americans. There has been a sharp decline in their wealth. In the 21st century Americans have suffered two major stock market crashes and the destruction of their real estate wealth.

Some studies have concluded that the real incomes of Americans, except for the financial oligarchy of the super rich, are less today than in the 1980s and even the 1970s. I have not examined these studies of family income to determine whether they are biased by the rise in divorce and percentage of single parent households. However, for the last decade it is clear that real take-home pay has declined.

The main cause of this decline is the offshoring of US high value-added jobs. Both manufacturing jobs and professional services, such as software engineering and information technology work, have been relocated in countries with large and cheap labor forces.

The wipeout of middle class jobs was disguised by the growth in consumer debt. As Americans’ incomes ceased to grow, consumer debt expanded to take the place of income growth and to keep consumer demand rising. Unlike rises in consumer incomes due to productivity growth, there is a limit to debt expansion. When that limit is reached, the economy ceases to grow.

The immiseration of working people has not resulted from worsening crises of over-production of goods and services, but from financial capital’s power to force the relocation of production for domestic markets to foreign shores. Wall Street’s pressures, including pressures from takeovers, forced American manufacturing firms to “increase shareholders’ earnings.” This was done by substituting cheap foreign labor for American labor.

Corporations offshored or outsourced abroad their manufacturing output, thus divorcing American incomes from the production of the goods that they consume. The next step in the process took advantage of the high speed Internet to move professional service jobs, such as engineering, abroad. The third step was to replace the remains of the domestic work force with foreigners brought in at one-third the salary on H-1B, L-1, and other work visas.

This process by which financial capital destroyed the job prospects of Americans was covered up by “free market” economists, who received grants from offshoring firms in exchange for propaganda that Americans would benefit from a “New Economy” based on financial services, and by shills in the education business, who justified work visas for foreigners on the basis of the lie that America produces a shortage of engineers and scientists.

In Marx’s day, religion was the opiate of the masses. Today the media is. Let’s look at media reporting that facilitates the financial oligarchy’s ability to delude the people.

The financial oligarchy is hyping a recovery while American unemployment and home foreclosures are rising. The hype owes its credibility to the high positions from which it comes, to the problems in payroll jobs reporting that overstate employment, and to disposal into the memory hole of any American unemployed for more than one year.

On October 2 statistician John Williams of shadowstats.com reported that the Bureau of Labor Statistics has announced a preliminary estimate of its annual benchmark revision of 2009 employment. The BLS has found that employment in 2009 has been overstated by about one million jobs. John Williams believes the overstatement is two million jobs. He reports that “the birth-death model currently adds [an illusory] net gain of about 900,00 jobs per year to payroll employment reporting.”

The non-farm payroll number is always the headline report. However, Williams believes that the household survey of unemployment is statistically sounder than the payroll survey. The BLS has never been able to reconcile the difference in the numbers in the two employment surveys. Last Friday, the headline payroll number of lost jobs was 263,000 for the month of September. However the household survey number was 785,000 lost jobs in the month of September.

The headline unemployment rate of 9.8% is a bare bones measure that greatly understates unemployment. Government reporting agencies know this and report another unemployment number, known as U-6. This measure of US unemployment stands at 17% in September 2009.

When the long-term discouraged workers are added back into the total unemployed, the unemployment rate in September 2009 stands at 21.4%.

The unemployment of American citizens could actually be even higher. When Microsoft or some other firm replaces several thousand US workers with foreigners on H-1B visas, Microsoft does not report a decline in payroll employment. Nevertheless, several thousand Americans are now without jobs. Multiply this by the number of US firms that are relying on “body shops” to replace their US work force with cheap foreign labor year after year, and the result is hundreds of thousands of unreported unemployed Americans.

Obviously, with more than one-fifth of the American work force unemployed and the remainder buried in mortgage and credit card debt, economic recovery is not in the picture.

What is happening is that the hundreds of billions of dollars in TARP money given to the large banks and the trillions of dollars that have been added to the Federal Reserve’s balance sheet have been funneled into the stock market, producing another bubble, and into the acquisition of smaller banks by banks “too large to fail.” The result is more financial concentration.

The expansion in debt that underlies this bubble has further eroded the US dollar’s credibility as reserve currency. When the dollar starts to go, panicked policy-makers will raise interest rates in order to protect the US Treasury’s borrowing capability. When the interest rates rise, what little remains of the US economy will tank.

If the government cannot borrow, it will print money to pay its bills. Hyperinflation will hit the American population. Massive unemployment and massive inflation will inflict upon the American people misery that not even Marx and Lenin could envisage.

Meanwhile America’s economists continue to pretend that they are dealing with a normal postwar recession that merely requires an expansion of money and credit to restore economic growth.

By Paul Craig Roberts

Great Power Confrontation in the Indian Ocean: The Geo-Politics of the Sri Lankan Civil War

The support and positions of various foreign governments in regards to the diabolic fighting between the Tamil Tigers and the Sri Lankan military, which cost the lives of thousands of innocent civilians, says a great deal about the geo-strategic interests of these foreign governments. The position of the governments of India and a group of states that can collectively be called the Periphery, such as the U.S. and Australia, were in support of the Liberation Tigers of Tamil Ealam (LTTE) or Tamil Tigers, either overtly or covertly. Many of these governments also provided this support tacitly, so as not to close any future opportunity of co-opting Sri Lanka after the fighting was over.

In contrast, the governments of a group of states that can jointly be called Eurasia as a collective entity, such as Iran and Russia, supported the Sri Lankan government. The polar nature of the support by Eurasia and the Periphery for the two different combating sides in the Sri Lankan Civil War betrays the scent or odour of a much broader struggle. This is a struugle that extends far beyond the borders of the island of Sri Lanka and its region.

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Why is this so? Much of the answer to such a question has to do with the formation of a growing alliance in the Eurasian landmass against the international domination of the U.S. and its allies. This Eurasian alliance was formed on the basis of the growing cohesion between Moscow, Tehran, Beijing, and their allies that has seen the animation of the Primakov Doctrine. The Shanghai Cooperation Organization (SCO), a security body with real military dimensions that has been called “the NATO of the East” within some foreign policy circles is a real symbol of this geo-political dynamic. In 2009, the last chapter of the Sri Lankan Civil War was very much a theatre within this process.

Enter the Chinese Dragon: The start of Sri Lankan Estrangement from the U.S. and India

2007 was a milestone year for Sri Lanka. On March 12, 2007, Colombo agreed to allow the Chinese to build a massive naval port on its territory, at Hambantota. An agreement on the construction of the port was finalized and signed by the Sri Lankan Port Authority with two Chinese companies, the China Harbor Engineering Company and the Sino Hydo Corporation. The Sri Lankan government’s decision was mostly formed on the basis of economic benefits and Chinese support to end the fighting on their island.

What followed was the estrangement of Sri Lanka from the U.S. and India. It has been a U.S. policy to encircle China and to prevent it from building any ports or bases outside of Chinese territory. As a result, the U.S. shortly cut its military assistance to the Sri Lankan military. Indian support for the Tamil Tigers also increased through pressure on Colombo to make Sri Lanka a federal state with autonomy for the Tamils. Beijing threw its political weight behind Colombo and also began sending large arms shipments to Sri Lanka. As an additional comparison, Chinese aid to Sri Lanka in 2008 was about a billion U.S. dollars, while U.S. aid was only 7.4 million U.S. dollars.

It is from 2007 onward that Sri Lanka became a part of the alliance in Eurasia through its agreement with China and its subsequent estrangement from the U.S. and India. By the end of 2007, Sri Lanka had entrenched itself in the geo-strategic trenches with Russia, Iran, and China. These reasons and not humanitarian concern(s) are the primary rationale for support provided, in one way or another, to the Tamil Tigers by the governments of India, the U.S., Britain, Japan, Australia, Canada, and the European Union.



Sri Lankan Military ties to the Moscow-Beijing-Tehran Axis

Chinese military ties with Sri Lanka started in the 1990s, but it was in 2007 that Chinese and Sri Lankan military relations started to flower. According to Brahma Chellaney of the Centre for Policy Research in New Delhi, India: “China’s arms sales [were] the decisive factor in ending the military stalemate [in the Sri Lankan Civil War.]” In April, just one month after the 2007 agreement between the Sri Lankan Port Authority and both the China Harbor Engineering Company and the Sino Hydo Corporation, China signed a major ammunition and ordnance deal with the Sri Lankan military. Beijing also transferred, free of charge, several military jets to the Sri Lankan military, which were decisive in defeating the Tamil Tigers.

Iran and Russia also began to rapidly develop their military ties with Sri Lanka after Colombo agreed to host the Chinese port in Hambantota. In this regard, Beijing, Moscow, and Tehran all have cooperation and military agreements with Sri Lanka. The visits of Sri Lankan leaders and military officials to Tehran, Moscow, and Beijing in 2007 and 2008 were all tied to Sri Lankan preparations to militarily disarm the Tamil Tigers with the help of these Eurasian states.

China, Russia, and Iran all ultimately helped arm the Sri Lankan military before the last phase of the Sri Lankan Civil War. For the Eurasian alliance the aim of ending the Sri Lankan Civil War was to ensure the materialization of the Chinese port and to prevent any possibility of regime change in Colombo, which would ensure the continuity of a Sri Lankan government allied to China, Russia, and Iran. Along with Sri Lankan officials, the governments of Iran, Russia, and China believed that unless the Tamil Tigers were neutralized as a threat that the U.S. and its allies, in possible league with India, could make attempts to overthrow the Sri Lankan government in order to nullify the Sri Lankan naval port agreement with China and to remove Sri Lanka from the orbit of Eurasia. In this context, they all threw their weight behind Sri Lanka during the fighting in 2009 and in the case of China and Russia at the U.N. Security Council.

Associated Press (AP) reported on December 23, 2007:

In the wake of the United States Senate slashing military assistance to Sri Lanka, the Russian Federation has stepped in to fill the vacuum, sending the first ever top level military delegation to Colombo to discuss military cooperation. A high level Russian military delegation led by [Colonel-General] Vladimir Moltenskoy last week met Defence Secretary Gotabhaya Rajapaksa, Army Commander [Lieutenant-General] Sarath Fonseka and Air Force Commander, Roshan Goonathilake and had visited several major military installations in the island. [Colonel-General] Molpenskoy, a veteran combat General in the Russian Army was formerly the operational commander of the Russian Forces in Chechnya.

The Russian Federation, China, and Iran also all face their own separatist movements like Sri Lanka. All four nations see these movements as being supported by outside players for geo-strategic reasons. In 2007, not only did Moscow, like China, move in to fill the vacuum of military supplies left by the U.S. government after Sri Lanka agreed to build the Chinese naval port; the Kremlin also sent Colonel-General Vladimir Moltenskoy who oversaw the Russian military campaign against the separatist movement in Chechnya. Moltenskoy arrived in Sri Lanka as a military advisor to Colombo.

The aid of Tehran was also crucial for the Sri Lankan military. The Island, a Sri Lankan news source reported: “Iran had come to Sri Lanka’s rescue (...) when an LTTE [or Tamil Tiger] offensive had threatened to overwhelm the [Sri Lankan] army in Jaffna [P]eninsula. Sources said that several plane loads of Iranian [military] equipment were made available immediately after Sri Lanka sought assistance from the Iranian leadership.” The Island also reported, before the arrival of a high level Iranian military delegation to Sri Lanka in 2009, that Iran, which is “widely believed to [sic.; be] a leading strategist in” the use of tactical boats, and Sri Lanka “have over the year developed strategies relating to small [tactical] boat operations.”

The extent of the help Iran, Russia, and China provided to Sri Lanka also included economic support within the framework of the Sri Lankan military preparations leading to the assaults on the Tamil Tigers in 2009. The Hindu on September 21, 2009 published an article partially revealing the depth of the level and importance of the help that Sri Lanka had been receiving from Iran alone:

Iran has extended by another year the four-month interest-free credit facility granted to Sri Lanka after President Mahinda Rajapaksa’s visit to Iran in November 2007, state-run Daily News reported on Monday.

It said that consequent to talks with Iranian President Mahmoud Ahmadinejad, the Iranian government granted the facility from January 2008 to August 31.

In 2008, Sri Lanka imported crude oil under this facility to the tune of $1.05 billion, nearly all of its requirements, easing the pressure on the country’s foreign exchange requirements in a year of significance for the government’s war with the LTTE [or the Tamil Tigers].

An additional three-month credit package at a concessionary rate of interest was also accommodated in Sri Lanka’s favour on September 3 [2009] at a meeting between the representatives of the countries in Tehran.

Chinese Naval Interests and Energy Security Concerns and Sri Lanka

Why a Chinese port in Sri Lanka? Why in Sri Lanka of all places? Sri Lanka is situated at a vital maritime corridor in the Indian Ocean. This position is at a vital juncture in the maritime shipping paths of the Indian Ocean that is important for trade, security, and energy supplies. This is why Moscow, Tehran, and Beijing stand behind Colombo.

The Chinese naval port under construction and at Hambantota is part of a New Cold War to secure energy routes. Most of the energy supplies going to Asia pass the southern tip of Sri Lanka. It is for this reason that the Chinese have included Sri Lanka within their project of establishing a chain of naval bases in the Indian Ocean to protect their energy supplies coming from the Middle East and Africa. Myanmar (Burma) is also part of this project and in many cases the pressure on the governments in both states is linked to their agreements to build Chinese ports with Beijing.

In league with China, Iran also has naval ambitions in Sri Lanka and the broader Indian Ocean as part of an initiative to protect the maritime routes between itself and China. China and Iran have both been expanding their naval forces. This is part of a growing trend. The seas and bodies of water around all Eurasia from the Baltic Sea, the Black Sea, the Red Sea, the Gulf of Aden, the Persian Gulf, and the the Arabian Sea to the Bay of Bengal, the South China Sea, and the East China Sea have all been under heavy militarization over the years. In no point in history have the oceans seen such large numbers of warships at one time. This militarization process on the waves of Eurasia is ultimately tied to controlling movement and encircling the Eurasian landmass in a coming showdown.



Sri Lanka enters the Shanghai Cooperation Organization (SCO)

In 2009, Sri Lanka joined the SCO, as did Belarus. The entry of Sri Lanka into the Eurasian organization was announced at the SCO conference in Yekaterinburg, where the light was on Mahmoud Ahmadinejad following the election riots in Iran. While the SCO put its weight behind the re-election of the Iranian President, Sri Lanka thanked the organization for its collective support against the Tamil Tigers.

Both Sri Lanka and Belarus, which is also a member of the Russian-led Collective Security Treaty Organization (CSTO), entered the SCO as dialogue partners. The entry of Sri Lanka into the SCO as a dialogue partner confirms its strategic ties and alliance with Russia, China, and Iran. Dialogue partner status in the SCO puts Sri Lanka under the umbrella of China and Russia. Although it is not spelled out in Article 14 of the SCO Charter, a dialogue partner can request protection and defensive aid under such a relationship. Dialogue partners are also financially tied to the SCO, which facilitates their integration into the coming Eurasian Union that will emerge from the cohesion of Russia, China, Iran, and their partners.

Sri Lanka and the Broader Conflict in Eurasia

In the so-called Western World double-standards were applied to the final chapter of the Sri Lankan Civil War. While the U.S. and its allies supported the military actions of Georgia to secure its territorial integrity by bringing South Ossetia and Abkhazia under its control through force in 2008 they did not do this in regards to Sri Lanka in 2009. In essence the actions of the Sri Lankan and Georgian governments were almost exactly the same: establishing government control of break-away territory through the use of military force. Yet, the reaction of the U.S. and its allies were contrastingly different in both cases. Georgia received support and Sri Lanka did not.

In addition, Georgia was legally obligated under international agreement not to use any military force to solve its internal conflict, but Sri Lanka was not. In legal terms, Abkhazia and South Ossetia, before the conflict, also enjoyed autonomous statuses within the framework of Georgia as a polity. This in no means justifies any of the deaths in Sri Lanka or the fighting in Georgia, but it does illustrate that double-standards were applied.

The reason that the U.S. and its allies supported Georgia and not Sri Lanka is tied to the encirclement of Eurasia. If there was no Chinese port being built in Sri Lanka or any ties between the Sri Lankan government and China the reaction of the U.S. government would have been much different. Most probably the American reaction would have been the same as when Israel acts against Palestinian civilians or when Saddam Hussein, as an American ally, gased the Iraqi Kurds.

The people of Sri Lanka from the Tamils to the Sinhalese are in the cross-hairs of a much larger and all enveloping global struggle. In the scenario of a possible conflict with the U.S. and the Periphery the maritime route that passes by Sri Lanka would be vital as an energy lifeline to the Chinese. The U.S. and its allies would ensure that this sea route is less secure for the Chinese by taking Sri Lanka out of the orbit of China and its allies. Even the balkanization of Sri Lanka could lead to a Tamil state that would most likely be allied to the U.S. and India, which may grant them military bases that would be in close proximity to Chinese positions in Sri Lanka.

Monday, October 12, 2009

Nobel nothings

Barack Obama given the Nobel peace prize, are you kidding me? For what? I cannot believe that this ridiculous committee has gone and done the same stupid thing based on nothing. Absolutely nothing. With all due respect to President Obama, but what has he actually done to deserve this prize? Then again, what had other winners of this meaningless prize done?

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Oh yes, Theodore Roosevelt brokered a peace between Japan and Russia. But he was a lover of war, who participated in the US conquest of Cuba, pretending to liberate it from Spain while fastening US chains on that tiny island. And as president he presided over the bloody war to subjugate the Filipinos, even congratulating a US general who had just massacred 600 helpless villagers in the Phillipines. The Committee did not give the Nobel prize to Mark Twain, who denounced Roosevelt and criticised the war, nor to William James, leader of the anti-imperialist league.

Also, Wilson gets credit for the League of Nations – that ineffectual body which did nothing to prevent war. But he had bombarded the Mexican coast, sent troops to occupy Haiti and the Dominican Republic and brought the US into the slaughterhouse of Europe in the first World War, surely among stupid and deadly wars at the top of the list.

Sure, the committee saw fit to give a peace prize to Henry Kissinger, because he signed the final peace agreement ending the war in Vietnam, of which he had been one of the architects. Kissinger, who obsequiously went along with Nixon's expansion of the war, with the bombing of peasant villages in Vietnam, Laos and Cambodia. Kissinger, who matches the definition of a war criminal very accurately, is given a peace prize!

People should be given a peace prize not on the basis of promises they have made – as with Obama, an eloquent maker of promises – but on the basis of actual accomplishments towards ending war, and Obama has continued deadly, inhuman military action in Iraq, Afghanistan and Pakistan.

The Nobel peace committee should retire, and turn over its huge funds to some international peace organization which is not awed by stardom and rhetoric, and which has some understanding of history.

Tuesday, October 6, 2009

Iran & the Myth


There are some terms that people in Islamic and Western countries should never say to each other, because they confuse and inflame more than they clarify. The most obvious ones would be “jihad”, “crusade” and “great satan”. All of them are used in somewhat innocuous ways by the people who utter them, but mean something completely different – and much more inflammatory – to foreign ears.

I would like to propose a topical addition to the list of words that should never be used, and that would be “myth”. Specifically when it is used in the context in which Iranian President Mahmoud Ahmadinejad and Egyptian Brotherhood leader Mohammed Mehdi Akef have mentioned it in recent months, i.e. to speak of "the myth of the Holocaust" (Egyptian Islamists deny Holocaust; BBC News, 23 Dec 2005) . They know what they mean by the phrase, and I know what they mean, but if they think that most people over here are going to hear it and respond with anything more profound than “Holocaust deniers!” then they are deeply ignorant of how central is the Holocaust in U.S. perceptions of the Middle East, how superficial is the U.S. public discourse on relations with the Muslim world, and how much that discourse is framed by those who are pushing for a “clash of civilizations” and who are currently fixated on finding a justification to bring about regime change in Iran.

Everyone knows what a myth is, right? It’s just a fairytale; an unlikely, invented story featuring toga-clad heroes of the ancient past. So when Ahmadinejad and Akef talk of the “myth of the Holocaust” they are simply – as the BBC suggests in the report I linked to above – saying that the Holocaust never really happened, and can be written off as Holocaust deniers. Except that that’s not what a “myth” is. (And I must be getting old, because I actually remember the days when any reporter employed by the BBC would have known the meaning of the word, and made some effort to render it accurately).

Let me tell you what a “myth” really is.

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Humans are complex beings who live in complex societies, and are capable of thoughts, insights and feelings beyond the mere physical needs of everyday life. Some of the intangible things that we feel about ourselves are difficult to articulate, so we express them by telling stories. And that’s what myths are. Myths are stories that groups of people tell to express and justify their most fundamental beliefs about themselves, their origins, their essential nature and their aspirations. The stories themselves can be historical or non-historical, but that is irrelevant to the myth. In the U.S., which for all its religiosity is basically a secular and demythologized society, we tend to think of myths as fairytales because the most common exposure we have to them is via the craptacular Hollywood spectacles of the 1960's like Jason and the Argonauts. But in fact a myth is a myth because it is a story that tells an underlying, existential truth about the people who tell it, and historicity is nothing to do with what makes it a myth.

For example, there are tribes in New Guinea that tell a traditional story about how children are conceived. The story explains that human conception takes place only when an emu passes through the parents’ village by night, and casts its shadow over their hut - all of which was very amusing to the 19th century European anthropologists who first documented the story, and thought it meant that the dumb natives didn’t even know where babies come from. But of course the dumb natives knew perfectly well where babies come from: the story was actually about something else altogether.

In the religious mythology of those New Guinea tribes, the emu was a symbol of divinity, and the story about the emu’s shadow was a creation myth that explained the origins of human beings and expressed what kind of creatures we are. By saying that a human baby can be conceived only when the parents are touched by the presence of the emu (God), the story expresses the conviction that humans are not just physical beings. Although a part of the created order, human beings have “higher” qualities that set them apart from every other created thing; they have the ability to transcend their instincts and passions and to be self-aware, spiritual, creative, empathetic etc, etc. So the conception of a new human being is never just a physical act, but requires an act of divine creation. It needs the mother and father to do their bit, but it doesn’t happen unless the emu makes an appearance too, as the myth puts it. If the people of New Guinea were Jewish, they might express the same fundamental understanding about themselves by telling a story about God breathing the breath of life into a handful of dirt to create the first man, or they might sum it up simply by saying that humanity is made “in the image and likeness of God”.

Another kind of myth: here in the U.S. we have made a myth out of the story of the Mayflower. Very few of us could claim that our families literally arrived here on the Mayflower. A few of us descend from people who were already here when the Pilgrims arrived. Quite a few of us came here on slave ships; an awful lot of us immigrated on steamships in the early 20th century; and some of us came here more recently courtesy of Boeing. But as Americans, we share a common narrative that says we, collectively, came here on the Mayflower. And we do that because we see in the story of the Mayflower a representation in historical form of what we as a nation believe America to be. We take the historical event and make it into a story that describes what we as Americans believe we essentially are: a pioneering people, a city on a hill, a community of faith in search of religious liberty, a free people fleeing tyranny and establishing democracy, etc etc.

That’s a different kind of myth from the emu story: one is a nationalistic myth, based on an historical event; the other is a religious myth, based on a non-historical event (i.e. there isn’t a real flesh and blood emu involved in human conception). But they’re both myths, because they are stories used to tell an underlying, existential truth about the people who tell them, and calling them myths is not in any way a judgement on whether the events in the story are historically true.

So what does it mean when Ahmadinejad and Akef refer to the “myth of the Holocaust”, as they both certainly did:

Speaking to thousands of people in the southeastern city of Zahedan, Mahmoud Ahmadinejad said: "Today, they have created a myth in the name of Holocaust and consider it to be above God, religion and the prophets." -- Holocaust a myth, says Iran president


The head of the Muslim Brotherhood, the main opposition force in Egypt's parliament, has echoed Iran's president in describing the Holocaust as a myth. "Western democracy has attacked everyone who does not share the vision of the sons of Zion as far as the myth of the Holocaust is concerned," Mohamed Akef said in a statement on Thursday. --Brotherhood chief: Holocaust a myth

"Some western governments, in particular the US, approve of the sacrilege on the Prophet Mohammad (PBUH), while denial of the `Myth of Holocaust', based on which the Zionists have been exerting pressure upon other countries for the past 60 years and kill the innocent Palestinians, is considered as a crime," added the president. -- President: Real holocaust to be sought in Palestine, Iraq

They don't say the Holocaust didn't happen; they are suggesting something more complex than that. That last quote in particular suggests that Ahmadinejad is using the word “myth” in its correct, technical sense. Remember: myths are stories that groups of people tell to express and justify their most fundamental beliefs about themselves, their origins, their essential nature, etc. Ahmadinejad is saying that Zionism tells the story of the Holocaust in exactly this way, i.e. as a vehicle to explain and justify what Zionists believe about themselves. When he “denies” the “myth” of the Holocaust, he is not denying the Holocaust, he’s not even discussing the Holocaust as a historical event at all. He is denying the validity of the use to which the story of the Holocaust is being put. He is saying that instead of being a story that expresses an underlying truth, “the myth of the Holocaust” expresses a “truth” that simply isn’t true, and that denial of that myth is such a big deal in the West because you are not meant to question whether the underlying claim is really true.

So what exactly is the “myth of the Holocaust” that Akef and Ahmadinejad reject? Well, do you remember Wissam Tayem, the Palestinian man forced by Israeli soldiers to play his violin for them at a checkpoint in the Occupied Territories?

The reaction to Wissam Tayem's experience at that checkpoint succinctly summarized what Ahmadinejad means by "the myth of the Holocaust". As Chris McGreal pointed out at the time, the sight of a Palestinian being forced to play the violin for his occupiers caused quite a stir in Israel. But the main reason it made Israelis (specifically Jewish-Israelis) uncomfortable was not because they recognized that it's simply wrong to treat a human being the way Wissam Tayem was treated. Instead, it made them uncomfortable because it challenged their image of the kind of people they are, and the kind of country they have created. In other words, it undermined the Israelis' myth of themselves.

Of all the revelations that have rocked the Israeli army over the past week, perhaps none disturbed the public so much as the video footage of soldiers forcing a Palestinian man to play his violin...

[A]fter the incident was videotaped by Jewish women peace activists, it prompted revulsion among Israelis not normally perturbed about the treatment of Arabs. The rightwing Army Radio commentator Uri Orbach found the incident disturbingly reminiscent of Jewish musicians forced to provide background music to mass murder. "What about Majdanek?" he asked, referring to the Nazi extermination camp.

The critics were not drawing a parallel between an Israeli roadblock and a Nazi camp. Their concern was that Jewish suffering had been diminished by the humiliation of Mr Tayem.

Yoram Kaniuk, author of a book about a Jewish violinist forced to play for a concentration camp commander, wrote in Yedioth Ahronoth newspaper that the soldiers responsible should be put on trial "not for abusing Arabs but for disgracing the Holocaust". "Of all the terrible things done at the roadblocks, this story is one which negates the very possibility of the existence of Israel as a Jewish state. If [the military] does not put these soldiers on trial we will have no moral right to speak of ourselves as a state that rose from the Holocaust," he wrote. "If we allow Jewish soldiers to put an Arab violinist at a roadblock and laugh at him, we have succeeded in arriving at the lowest moral point possible. Our entire existence in this Arab region was justified, and is still justified, by our suffering; by Jewish violinists in the camps." [Emphasis mine]

That last line sums up precisely what Ahmadinejad and Akef mean when they say that Zionism has made a “myth of the Holocaust”. They mean that Zionism tells the story of the Holocaust with the purpose of justifying what it has done to Palestine and its inhabitants. The underlying truth that the myth is meant to convey is that Jewish suffering in Europe justified the establishment of a Jewish state in a land whose population was 1. not Jewish, but overwhelmingly Muslim and Christian and 2. not responsible for European anti-Semitism or the Holocaust. Ahmadinejad and Akef are saying that this myth is a fake; that it is not an explanation of an underlying truth, but an appropriation of the Holocaust in order to further a political agenda. When they deny the “myth of the Holocaust”, they are not talking about whether the historical events of the Holocaust really happened, they are denying that Zionism is entitled to do what it does to the Palestinians because of what Nazism and its collaborators did to European Jewry. In short, "the myth of the Holocaust" says that Shoah justifies Nakba, and Ahmadinejad and Akef are saying, “No, it doesn’t”.

This is not some obscure reading of Akef and Ahmadinejad’s “myth” comments: they have both made it clear that their questions about the Holocaust aren’t about the Jewish genocide in Europeper se, but specifically about why the Palestinians should be the ones to pay for it. If you read the context in which Ahmedinejad said “they have made a myth of the Holocaust”, you find that the subject he is discussing is not whether the Holocaust took place, but rather “why the Palestinian nation should pay for the crimes the Europeans have committed” (which – if you think about it - kind of takes for granted already that those crimes really did happen):

"If the Europeans are telling the truth in their claim that they have killed six million Jews in the Holocaust during the World War II - which seems they are right in their claim because they insist on it and arrest and imprison those who oppose it, why the Palestinian nation should pay for the crime [?]…


Stressing that "the same European countries have imposed the illegally-established Zionist regime on the oppressed nation of Palestine", he said, "If you have committed the crimes so give a piece of your land somewhere in Europe or America and Canada or Alaska to them to set up their own state there. Then the Iranian nation will have no objections, will stage no rallies on the Qods Day and will support your decision."

Similarly, Muhammad Akef explicitly denied that his comments were anything to do with Holocaust denial:

The leader of Egypt's Muslim Brotherhood has said that when he called the Holocaust a myth this week, he did not mean to say it never happened but wanted to highlight the West's attitude towards democracy...

In a message on Thursday, Akif said: "Western democracy has attacked everyone who does not share the vision of the sons of Zion as far as the myth of the Holocaust is concerned."… But on Saturday, his office said: "Some media gave this a meaning which he [Akif] did not intend [and read it as] a denial that the Holocaust of the Jews by the Nazis during World War Two happened. The fact is that he did not deny that it took place."

And Akef’s Deputy, Dr. Mohamed El-Sayed Habib, made it clear what "myth of the Holocaust Akef was rejecting:

As to the reported statement describing the holocaust as a myth, it was not intended as a denial of the event but only a rejection of exaggerations put forward by Jews. This does not mean that we are not against the holocaust. Anyway, that event should not have led to the loss of the rights of the Palestinian people, the occupation of their land and the violation and assault of their sacred places and sanctities.

So, who really cares what a myth is, and what bearded foreigners half a world away have to say about it? Normally, this might just be an interesting academic discussion, but right now it actually matters that we try to understand what Ahmadinejad is really saying, because the Iranian government is currently the target of a disinformation campaign designed to soften up public opinion for regime change in that country. When we hear an inflammatory claim being pushed by our corporate media about Iran and its president - like for example, “Ahmadinejad denies the Holocaust!!!” – we would do well to remember the sad performance of our news media in laying the foundation for war in 2003, and to ask ourselves whether each new revelation is real news, or manufactured “news” designed to mobilize public opinion for a new war.

The same people who brought us the spectacular failure that is the Iraq war, would now like to try their luck in Iran. Paul Wolfowitz explained in May 2003 that, in the absence of a clear and present danger from Saddam Hussein, the Bush Administration had looked around for a justification for invading Iraq and settled on WMDs as the rationale that everyone could agree on. This time around, the U.S. needs a new excuse for invading a country that clearly is not going to invade us, and it’s really not too hard to see that the new excuse is going to focus in large part on the person of Mahmoud Ahmadinejad. Just look at the thrust of the stories about him that our news media have been feeding us over the last six months.

1. He’s a Holocaust denier! That’s what we are meant to understand from the reporting of his “myth of the Holocaust” statements that I have just been discussing.

2. He wants to wipe Israel off the map! That’s what we were told in our news media’s hysterical reporting of Ahmadinejad's speech to the “World Without Zionism” conference in Tehran on 26 October 2005. Except it turns out that, when correctly translated, he didn’t really say that Israel must be wiped off the map, but that "the occupation regime over Jerusalem should vanish from the page of time", which is not a threat of war or annihilation, but an expression of hope for regime change. Ahmadinejad isn’t a Zionist. He doesn’t believe that the Muslim-majority land of Palestine should be forcibly transformed into a Jewish state, and his speech is an expression of confidence that Zionist rule over Jerusalem will come to an end just as surely as other once-powerful regimes (he cites the examples of the Shah in Iran, the Communists in the Soviet Union, and Saddam’s rule over Iraq) all came to an end. If you look at the Middle East through a Zionist perspective, you might not like to hear that, but it doesn’t give anyone the right to pretend that he’s threatening to launch nukes at Tel Aviv or drive the Jews into the sea, as the “wiped off the map” language would suggest.

3. He's a "psychopath" who "speaks like Hitler"!

4. Iranian Jews are being forced to wear yellow stars! Do you remember that story, peddled first by Canada's National Post and and subsequently reproduced in the New York Post, about the law passed in the Iranian Parliament under which “Jews would be forced to wear yellow cloth strips - like the Star of David that Jews were made to wear in Nazi Germany”? (The National Post has since removed this article from its web site, but screenshots of the original story can be viewed at Lenin’s Tomb). Just look at the photos the National Post used to illustrate that story, to hammer home the point about where laws like this are leading Iran:

Except there is no such Iranian law. This story was a complete hoax (later retracted by the National Post), perpetrated by an Iranian monarchist expatriate journalist named Amir Taheri, who coincidentally happens to be a member of Benador Associates, a public relations firm that lists a large number of leading neo-conservatives, including American Enterprise Institute (AEI) associates Richard Perle, David Frum, Michael Ledeen, Michael Rubin, and Joshua Muravchik, among its clients. Major boosters of the war with Iraq, Benador clients, who also include former Central Intelligence Agency chief James Woolsey and former Israeli minister Natan Sharansky, have also called for the Bush administration to take a hard line against Iran.

The newspapers that so far have run the story are similarly identified with a hard line against Tehran. The National Post, which was bought by CanWest Global Communications from Conrad Black, a close associate of Perle's, is controlled by David and Leonard Asper, who have accused the Canadian Broadcasting Corporation of being anti-Israel, according to Marsha Cohen of Florida International University, who has closely followed the badges story.

Similarly, the Sun has consistently taken positions consistent with the right-wing Likud Party in Israel on Middle East issues, while Murdoch owns the strongly pro-Israel Weekly Standard and Fox News, in addition to the New York Post…

Are you sensing a theme here? Are you getting the message that Mahmoud Ahmadinejad is the new Hitler and Iran is the Fourth Reich and they’re just days away from nuking us and if we don’tShock and Awe them into regime change and install a U.S.-friendly regime that will recognise Israel and sell their oil and gas to us instead of to the Chinese then we’re all a bunch of appeasing Neville J’aime-Berlin’s and WE'RE ALL GOING TO DIE!!!…? Because that’s what you’re meant to understand. That’s the new meme, to make you scared enough to support a war you wouldn't otherwise support. Once again, our fears are being manipulated by people who want a war but haven't got a justification for starting one. Last time, they brought public opinion on board with scary stories about Iraq’s nonexistent nuclear weapons and Saddam's fictitious links to al Qaeda; this time around, it's Iran's nonexistent nuclear weapons and Ahmadinejad's spurious equivalence to Hitler.

And that’s why unravelling the meaning of Ahmadinejad’s "myth of the Holocaust" is not just an obscure academic exercise. Knowing that a propaganda offensive is underway to demonize Iran's president as the new Hitler so that we can justify an attack on his country, we need to think critically every time our mass media draws these parallels between Nazi Germany and present-day Iran and consider whether this is a legitimate equivalence or more manipulative scare-mongering to lay the foundation for a new war. Despite what Richard Perle and Michael Ledeen et al sound like when they dispassionately discuss rearranging the Middle East, war is not really like a game of Risk or a role-playing exercise in an undergraduate PolSci seminar. It is much more likeyoung soldiers getting their limbs blown off by roadside bombs, or entire families wiped out "collaterally" by our missiles. Knowing that this is what is really at stake, we should at least make the effort to determine whether the “Holocaust denier!” and other hitlerish epithets currently being hurled at Iran are based in fact, or are just the latest work of the same misinformers who – from the safety of their Washington thinktanks - repeatedly pimp for war in the Middle East, safe in the knowledge that it will never be their friends and relatives on the receiving end of the IEDs or the so-called smart bombs.

After more than three years in Iraq, when more than 2500 of our own troops and unknown thousands of Iraqis have been killed, Americans have finally become skeptical about why we invaded Iraq in the first place, and are wondering what exactly we are fighting for there. When it comes to the threatened attack on Iran, maybe this time we could do the critical thinking before we invade and sentence to death tens of thousands of our fellow human beings whose lives are as valuable in every respect as our own. In the immortal words of the President himself: "There's an old saying in Tennessee -- I know it's in Texas, probably in Tennessee -- that says, fool me once, shame on -- shame on you. Fool me -- you can't get fooled again."

Monday, October 5, 2009

Top Things you Think You Know about Iran that are not True

Thursday is a fateful day for the world, as the US, other members of the United Nations Security Council, and Germany meet in Geneva with Iran in a bid to resolve outstanding issues. Although Iranian president Mahmoud Ahmadinejad had earlier attempted to put the nuclear issue off the bargaining table, this rhetorical flourish was a mere opening gambit and nuclear issues will certainly dominate the talks. As Henry Kissinger pointed out, these talks are just beginning and there are highly unlikely to be any breakthroughs for a very long time. Diplomacy is a marathon, not a sprint.

But on this occasion, I thought I'd take the opportunity to list some things that people tend to think they know about Iran, but for which the evidence is shaky.

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Belief: Iran is aggressive and has threatened to attack Israel, its neighbors or the US

Reality: Iran has not launched an aggressive war modern history (unlike the US or Israel), and its leaders have a doctrine of "no first strike." This is true of Supreme Leader Ali Khamenei, as well as of Revolutionary Guards commanders.

Belief: Iran is a militarized society bristling with dangerous weapons and a growing threat to world peace.

Reality: Iran's military budget is a little over $6 billion annually. Sweden, Singapore and Greece all have larger military budgets. Moreover, Iran is a country of 70 million, so that its per capita spending on defense is tiny compared to these others, since they are much smaller countries with regard to population. Iran spends less per capita on its military than any other country in the Persian Gulf region with the exception of the United Arab Emirates.


Belief: Iran has threatened to attack Israel militarily and to "wipe it off the map."

Reality: No Iranian leader in the executive has threatened an aggressive act of war on Israel, since this would contradict the doctrine of 'no first strike' to which the country has adhered. The Iranian president has explicitly said that Iran is not a threat to any country, including Israel.

Belief: But didn't President Mahmoud Ahmadinejad threaten to 'wipe Israel off the map?'

Reality: President Mahmoud Ahmadinejad did quote Ayatollah Khomeini to the effect that "this Occupation regime over Jerusalem must vanish from the page of time" (in rezhim-e eshghalgar-i Qods bayad as safheh-e ruzgar mahv shavad). This was not a pledge to roll tanks and invade or to launch missiles, however. It is the expression of a hope that the regime will collapse, just as the Soviet Union did. It is not a threat to kill anyone at all.

Belief: But aren't Iranians Holocaust deniers?

Actuality: Some are, some aren't. Former president Mohammad Khatami has castigated Ahmadinejad for questioning the full extent of the Holocaust, which he called "the crime of Nazism." Many educated Iranians in the regime are perfectly aware of the horrors of the Holocaust. In any case, despite what propagandists imply, neither Holocaust denial (as wicked as that is) nor calling Israel names is the same thing as pledging to attack it militarily.

Belief: Iran is like North Korea in having an active nuclear weapons program, and is the same sort of threat to the world.

Actuality: Iran has a nuclear enrichment site at Natanz near Isfahan where it says it is trying to produce fuel for future civilian nuclear reactors to generate electricity. All Iranian leaders deny that this site is for weapons production, and the International Atomic Energy Agency has repeatedly inspected it and found no weapons program. Iran is not being completely transparent, generating some doubts, but all the evidence the IAEA and the CIA can gather points to there not being a weapons program. The 2007 National Intelligence Estimate by 16 US intelligence agencies, including the CIA and the Defense Intelligence Agency, assessed with fair confidence that Iran has no nuclear weapons research program. This assessment was based on debriefings of defecting nuclear scientists, as well as on the documents they brought out, in addition to US signals intelligence from Iran. While Germany, Israel and recently the UK intelligence is more suspicious of Iranian intentions, all of them were badly wrong about Iraq's alleged Weapons of Mass Destruction and Germany in particular was taken in by Curveball, a drunk Iraqi braggart.

Belief: The West recently discovered a secret Iranian nuclear weapons plant in a mountain near Qom.

Actuality: Iran announced Monday a week ago to the International Atomic Energy Agency that it had begun work on a second, civilian nuclear enrichment facility near Qom. There are no nuclear materials at the site and it has not gone hot, so technically Iran is not in violation of the Nuclear Non-Proliferation Treaty, though it did break its word to the IAEA that it would immediately inform the UN of any work on a new facility. Iran has pledged to allow the site to be inspected regularly by the IAEA, and if it honors the pledge, as it largely has at the Natanz plant, then Iran cannot produce nuclear weapons at the site, since that would be detected by the inspectors. Secretary of State Hillary Clinton admitted on Sunday that Iran could not produce nuclear weapons at Natanz precisely because it is being inspected. Yet American hawks have repeatedly demanded a strike on Natanz.


Belief: The world should sanction Iran not only because of its nuclear enrichment research program but also because the current regime stole June's presidential election and brutally repressed the subsequent demonstrations.

Actuality: Iran's reform movement is dead set against increased sanctions on Iran, which likely would not affect the regime, and would harm ordinary Iranians.

Belief: Isn't the Iranian regime irrational and crazed, so that a doctrine of mutally assured destruction just would not work with them?

Actuality: Iranian politicians are rational actors. If they were madmen, why haven't they invaded any of their neighbors? Saddam Hussein of Iraq invaded both Iran and Kuwait. Israel invaded its neighbors more than once. In contrast, Iran has not started any wars. Demonizing people by calling them unbalanced is an old propaganda trick. The US elite was once unalterably opposed to China having nuclear science because they believed the Chinese are intrinsically irrational. This kind of talk is a form of racism.

Belief: The international community would not have put sanctions on Iran, and would not be so worried, if it were not a gathering nuclear threat.

Actuality: The centrifuge technology that Iran is using to enrich uranium is open-ended. In the old days, you could tell which countries might want a nuclear bomb by whether they were building light water reactors (unsuitable for bomb-making) or heavy-water reactors (could be used to make a bomb). But with centrifuges, once you can enrich to 5% to fuel a civilian reactor, you could theoretically feed the material back through many times and enrich to 90% for a bomb. However, as long as centrifuge plants are being actively inspected, they cannot be used to make a bomb. The two danger signals would be if Iran threw out the inspectors or if it found a way to create a secret facility. The latter task would be extremely difficult, however, as demonstrated by the CIA's discovery of the Qom facility construction in 2006 from satellite photos. Nuclear installations, especially centrifuge ones, consume a great deal of water, construction materiel, and so forth, so that constructing one in secret is a tall order. In any case, you can't attack and destroy a country because you have an intuition that they might be doing something illegal. You need some kind of proof. Moreover, Israel, Pakistan and India are all much worse citizens of the globe than Iran, since they refused to sign the NPT and then went for broke to get a bomb; and nothing at all has been done to any of them by the UNSC.

Monday, September 28, 2009

Time to Change Bernanke's Medication?

I still get a thrill whenever I get my hands on a confidential memo with "The White House, Washington" on the letterhead. Even when--like the one I'm looking at now--it's about a snoozy topic: This week's G-20 summit.

But the letter's content shook me awake and may keep me up the rest of the night.

The 6-page letter from the White House, dated September 3, was sent to the 20 heads of state that will meet this Thursday in Pittsburgh. After some initial diplo-blather, our President's "sherpa" for the summit, Michael Froman, does a little victory dance, announcing that the recession has been defeated. "Global equity markets have risen 35 percent since the end of March," writes Froman. In other words, the stock market is up and all's well.

While acknowledging that this year's economy has gone to hell in a handbag, Obama's aide and ambassador to the G-20 seems to be parroting the irrational exuberance of Federal Reserve Chief Ben Bernanke who declared last week that, "The recession is very likely over." All that was missing from Bernanke's statement was a banner, "MISSION ACCOMPLISHED."
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And the French are furious. The White House letter to the G-20 leaders was a response to a confidential diplomatic missive from the chief of the European Union Fredrik Reinfeldt written a day earlier to "Monsieur le Président" Obama.

We have Reinfeldt's confidential note as well. In it, the EU president says, despite Bernanke's happy-talk, "la crise n'est pas terminée (the crisis is not over) and (continuing in translation) the labor market will continue to suffer the consequences of weak use of capacity and production in the coming months." This is diplomatic speak for, What the hell is Bernanke smoking?

May I remind you Monsieur le Président, that last month 216,000 Americans lost their jobs, bringing the total lost since your inauguration to about seven million? And rising.

The Wall Street Journal also has a copy of the White House letter, though they haven't released it. (I have: read it here, with the EU message and our translation.) The Journal spins the leak as the White House would want it: "Big Changes to Global Economic Policy" to produce "lasting growth." Obama takes charge! What's missing in the Journal report is that Obama's plan subtly but significantly throttles back European demands to tighten finance industry regulation and, most important, deflects the EU's concern about fighting unemployment.

Europe's leaders are scared witless that the Obama Administration will prematurely turn off the fiscal and monetary stimulus. Europe demands that the US continue pumping the economy under an internationally coordinated worldwide save-our-butts program.

As the EU's Reinfeldt's puts it in his plea to the White House, "It is essential that the Heads of State and Government, at this summit, continue to implement the economic policy measures they have adopted," and not act unilaterally. "Exit strategies [must] be implemented in a coordinated manner." Translating from the diplomatique: If you in the USA turn off fiscal and monetary stimulus now, on your own, Europe and the planet sinks, America with it.

Obama's ambassador says, Non! Instead, he writes that each nation should be allowed to "unwind" anti-recession efforts "at a pace appropriate to the circumstances of each economy." In other words, "Europe, you're on your own!" So much for Obama channeling FDR.

The technical policy conflict between the Obama and EU plans reflects a deep difference in the answer to a crucial question: Whose recession is it, anyway? To Obama and Bernanke, this is a bankers' recession and so, as "stresses in financial markets have abated significantly," to use the words of the White House epistle, then "Happy Days Are Here Again." But, if this recession is about workers the world over losing their jobs and life savings, the EU view, then it's still "Buddy, Can You Spare a Dime."

If Bernanke and Obama were truly concerned about preserving jobs, they would have required banks loaded with taxpayer bail-out loot to lend these funds to consumers and business. China did so, ordering its banks to increase credit. And boy, did they, expanding credit by an eye-popping 30%, rocketing China's economy out of recession and into double-digit growth.

But the Obama Administration has gone the opposite way. The White House letter to the G-20 calls for slowly increasing bank reserves, and that can only cause a tight credit market to tighten further.

It's not that the White House completely ignores job losses. The US letter suggests, "The G-20 should commit to ... income support for the unemployed." You can imagine the Europeans, who already have generous unemployment benefits--most without time limits--turning purple over that one. America's stingy unemployment compensation extension under the Stimulus Plan is already beginning to expire with no live proposal to continue aid for the jobless victims of this recession.

The Europeans are so cute when they're angry, when they pound their little fists. Obama assumes he can ignore them. The EU, once the big player in the G-7, has seen its members' status diluted into the G-20, where the BRIC powers (Brazil, Russia, India and China) now flex their muscles. But Europeans have a thing or two to teach Americans about the economics of the twilight of empire.

Maybe the differences are cultural, not economic; that Europeans lack America's Manifest Destiny can-do optimism.

So, to give the visitors a taste of the yes-we-can spirit, Obama should invite Pittsburgh's 93,700 jobless to the G-20 meet to celebrate that 35% rise in the stock market.

Or -- my own suggestion -- change Bernanke's medication.