The Agencies involved in the Volcker rulemaking process have an historic opportunity to redress many of the economic wrongs of the past, and create a future that privileges the interests of the many rather than the few. We ask that the Agencies vigorously implement the considerable responsibilities that have been discharged to them by Congress, remain faithful to the statute’s intent and consider the comments contained in this letter. PDF of our Comment Letter
In my opinion, one of the most important books written in recent years on the subject of the global arms trade and its corrupting effects is Andrew Feinstein’s, The Shadow World, Inside the Global Arms Trade. This voluminous book is mind numbing in its detail, but it is thoroughly sourced and, I believe, it will become a standard reference over time. Anyone trying to understand the dark and dangerous corner of the global economy and its politics must read this book. (To be sure, I am biased because I was a minor source in this book and I consider Andrew a good friend.)
Naturally, the arms makers are not too happy with the Shadow World and want to keep it hidden in the musty stacks of your local library. I am attaching two recent essays to help you determine if this book should be forgotten. They were published on the Lexington Institute’ Early Warning Blog. Lexington is funded in large part by defense contractors and is hardly impartial on all matters regarding defense spending, so the first essay is quite expected; the second, however, comes as a surprise, to Lexington’s credit.
The first essay is a predictable critique of Andrew’s book by Robert Trice, a retired Senior Vice President of Lockheed Martin. Think of his effort as an attempt to move Andrew’s book to a forgotten corner in the back room.
To understand the saliency of Trice’s effort, consider his career. Robert Trice is a case study in the quintessential pattern of gorging oneself on cash flow pumped out by the Military – Industrial – Congressional Complex’s big green spending machine. Holding a PhD in political science, he began his defense career in the Office of the Secretary of Defense in the Pentagon, where he eventually became Director for Technology and Arms Transfer Policy — or in plain english, a resident shill in the Pentagon for promoting international arms sales — the subject painted in not so flattering terms by Feinstein. Trice then moved to Capital Hill and worked as the defense Legislative Assistant to Senator Dale Bumpers (D-AR) for about three years. I met him in this position because Bumpers was interested in the military reform work my colleagues (Pierre Sprey and John Boyd) and I were doing in the Pentagon. But Trice, as Bumpers’ advisor, was clearly a reluctant reformer. (Although Bumpers showed initial and enthusiastic interest in our work, nothing came of it.) In the essay below Trice now slings a little mud, saying the three of us are not just wrong but wrongly motivated, because we are “anti-defense.” Soon thereafter, the presumably pro-defense Trice cashed out of Bumpers office to work in the Defense industry, serving first as a Vice President for Business Development at McDonnel Douglas (in plain english this is a marketing job and in the MICC, marketing, or business development, means greasing the skids in Congress and the Pentagon for your firm’s tinker toys — which is a good position for a poly sci type, because he couldn’t design airplanes at McAir or Lockheed). Trice then moved to Lockheed Martin where his business development portfolio including shaping L-M’s new business strategies and operations for the global market, which of course is the subject of Andrew’s book. Obviously a person with his background of bottom feeding so successfully in the MICC’s money machine, especially in the international arms trade arena, comes to the reviewing table with … shall we say … a certain amount of bias.
The second essay is Andrew Feinstein’s polite repost to Trice’s bucket of grease. Andrew’s background could not be more different than that of Trice. Whereas Trice gorged himself and became a wealthy ‘pillar of the establishment’ by slopping in America’s defense trough, Andrew put his ass on the line trying to rein in the excesses of that trough’s South African equivalent. In the late 1980s, Andrew, a young white South African, joined Nelson Mandella’s African National Congress (ANC), because he opposed Apartheid. In 1994, after the fall of Apartheid, he was elected in South Africa’s first democratic election to be an ANC member of parliament. But Andrew took his parliamentary oversight responsibilities seriously, and while in parliament, he set up a kind of one man Truman Committee to investigate allegations of ANC corruption in some international weapons deals. And he hit pay dirt, but rather than shutting up when he was pressured by party elders to close down his investigation into a £5bn arms deal that was tainted by allegations of high-level corruption, he resigned in protest from Parliament. His political memoir, After the Party: A Personal and Political Journey Inside the ANC, was published in 2007 and became a bestseller in South Africa.
With the backgrounds of these two protagonists in mind, I urge you to read Trice’s critique of Andrew’s latest book first (Attachment 1 below) and then Andrew’s repost (Attachment 2 below) and judge for yourself who is closer to being a straight shooter — and read The Shadow World.
Most discussions of possible United States military operations in the Persian Gulf, should Iran try to prevent maritime traffic from going through the Strait of Hormuz, generally say that while it would not be a cakewalk, it would not be an enormously difficult task either.
But that conventional wisdom is wrong, according to a recent report issued by an independent, non-profit public policy research institute in Washington DC. The report found that the traditional post-Cold War US military ability to project power overseas with few serious challenges to its freedom of action may be rapidly drawing to a close.
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It stressed that “a Strait of Hormuz closure could trigger a much larger price spike, including by limiting offsetting supplies from other producers in the region”.
Phi Beta Iota: Two themes are emerging in the open source world. First, the depth and breadth of Israel’s clandestine agreements with its Arab neighbors is not clearly understood–a National Intelligence Estimate is required, but the collection, processing, and analysis capabilities are simply not there, and the management will to do this as a multinational task is not there either. Second, as the US loses its ability to actually project force, the finance of war is being replaced by the theater of war, such that oil prices can still be manipulated, but at a fraction of the blood, sweat, and tears previously mobilized – financial fraud on the cheap, as it were.
Economic imbalances and social inequality risk reversing the gains of globalization, warns the World Economic Forum in its report Global Risks 2012. These are the findings of a survey of 469 experts and industry leaders who worry that the world’s institutions are ill-equipped to cope with today’s interconnected, rapidly evolving risks. The findings of the survey fed into an analysis of three major risk cases: Seeds of Dystopia; Unsafe Safeguards and the Dark Side of Connectivity. Report also analyses the top 10 risks in five categories – economic, environmental, geopolitical, societal and technological.
Phi Beta Iota: The report fails to address the absence of both intelligence and integrity among all “institutions” be they public or private. This is the entire point of the global Occupy movement. This is also the entire point of this website, which predates Occupy by some time.
Europe: Updates. In an interview with a French daily on 25 December, International Monetary Fund (IMF) Managing Director Christine Lagarde stressed that Europe’s financial crisis is turning into “a crisis of confidence in public debt and the solidity of the financial system.
Greece: According to an IMF source involved in discussions with Greece, the situation in Athens is “deteriorating” and “a further 10-15 billion euros ($13.1-19.6 billion) still needs to be found.” Banks may be asked to agree to write off 65 % instead of 50% of Greece’s debt.
France: The French National Institute for Statistics and Economic Studies (INSEE) said on 26 December that there were 29,000 new job seekers “without any occupation” in November, up 1.1% over October. The year-on-year increase reached 5.2%. In total, 2,844,800 people did not have any occupation, the highest such figure since November 1999.
An economist at the French Observatory of Economic Conditions speculated that France’s unemployment rate — which currently stands at 9.3% — will reach 10.7% by the end of 2012, and predicted that Paris will not succeed in bringing the deficit down to 3% of GDP by 2013.
Spain: At a news conference on 26 December, Spanish Economy Minister Luis De Guindos said that the Spanish economy had suffered a “relapse” and would record negative growth in the fourth quarter of 2011. De Guindos warned that “the next two months are not going to be easy, neither from a growth nor a jobs point of view.”
Comment: According to the Financial Times and multiple economists the fate of the euro depends on what happens in Italy. This week Italy intends to auction bonds worth Euros 20 billion. The market reaction to the auction will be an important indicator of whether the central bankers have found a way to stabilize the financial crisis, or have just made it worse.
All analysts of European economics predict a recession in 2012. They differ only about how severe it will be. In an integrated global economy, the ripple effects from Europe will drag the US and the Chinese economies, among all others.
Phi Beta Iota: Christine Lagarde, perhaps because she is a woman with a smaller ego and larger intuition than most men, appears to be the first Epoch A leader to “get” that we are all calling into question the very existence of the Western financial system that is rooted in fraud, waste, and abuse. When she begins to point to Iceland as an example, and to demand that Western countries arrest and try Goldman Sachs, Morgan, Citi-Bank, Bank of America, and other officials for high crimes against the public, the healing can begin. Until then, the West is avoiding the fundamentals.
Buddy Roemer is a candidate for the Republican nomination for president. He served in Congress from 1981-88 as one of the last truly conservative Democrats who crossed the aisle to back the Reagan agenda. He later was governor of Louisiana and switched party affiliation to the GOP. A longtime business executive, Mr. Roemer founded and was CEO of Business First Bank, a small community lender with $650 million is assets.
Memorable Line: “I’m a Methodist boy, and I believe in miracles.”
Memorable Line: “I want Washington DC to stop being the capital for corruption.”
We are going to move from denial to realization. Physical world events will drive the process of realization. The primary trend is between stability and instability. We are moving from a multi-class system running from Super Elite to Unperson into a model of have’s and have-nots, the unpersons. Labor has become a problem because less than 500 million are involved in life support activities thereby leaving more than 7 billion people very vulnerable to dependency (and treated as expendable containers). We are watching a redistribution process bound towards divestiture as more people become unpersons. Destruction of paper assets, debt collapse, bank failure, and war are all part of the redistribution process. With more unpeople, it becomes easier to reduce population through death and abuse. Our current economic structure has at least six trajectories of support; the physical world, human capital, transportation, technology, rule of law,and money.
Fukishima, Katrina, Gulf of Mexico oil spill — all examples of entire populations treated as “unpersons.”
Bogle says he’s paying close attention to tax policies he considers unfair, including one that’s favorable to the fund industry and investors with taxable accounts. The top rate for dividends and long-term capital gains is historically low at 15 percent, as a result of the extension of Bush era tax cuts that Congress and President Barack Obama agreed to a year ago. In contrast, top earners pay 35 percent on regular income. He doesn’t like that disparity.
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As for capital gains, there ought to be some distinction between capital made by people who start businesses, and contribute value to society, and capital made by gamblers on Wall Street, some of whom win. Earned capital income should carry the regular dividend rate, but capital income gains by trading, and particularly short-term trading, should pay a higher tax, even than the present ordinary income rate.
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Q: What’s your take on the Occupy movement?
A: I’m happy to say that my current income puts me in the 99 percent group. So maybe I’m not so happy, I don’t know.
This movement has brought to the surface some very serious problems in our country about disparities in opportunity and income. So many young people are having a terrible time getting a job.
Young people have great idealism, and the Occupy movement has been a bit unrealistic at times. So what? I can’t imagine a worse America if our younger generation didn’t have great idealism. I salute them for their enthusiasm, and their mission.
The negative side is that they just pushed too hard for too long. It’s very difficult for any movement without any seeming leadership — other than a good idea — to have any sense of taste or judgment. Who’s to say, ‘This is going too far’? In some places, it’s just gone on too long, and it’s been too disruptive. So I think it’s good that we’ve been cleaning up the plazas where the Occupy movement set up.
An economic model that seeks to include the cost of negative externalities into the pricing of goods and services. Supporters of this type of economic system feel products and activities that direct or indirectly cause harmful consequences to living beings and/or the environment should be accordingly taxed to reflect the somewhat hidden costs.
North Korean dictator Kim Jong Il was murdered Saturday as part of a major power struggle in East Asia, according to Asian secret society sources and Japanese military intelligence.
The murder of Kim was followed by a series of arrests of senior police officials in Japan linked to North Korea as well as the ouster of six CIA agents, the Japanese sources say.
The death has left Yasuhiro Nakasone, the top North Korean and Rothschild agent in Japan, without a power base, Japanese underworld sources say. In North Korea, meanwhile, there is now a succession battle taking place between the Rothschild faction, who want to place their trained stooge Kim Jong Un in power and set up a Rothschild central bank versus a military clique that wants independence from Rothschild control, Rothschild and Japanese underworld sources say. The action is Asia is linked to a worldwide takedown of the satanic cabal that has been trying to create a global dictatorship.
Will Germany Kill the Goose that Laid the Golden Egg?
Since the middle of the 19th Century, the central questions in European politics have been been have been the closely connected questions of nationalism and the rise of German power. As my good friend and eminent historian Gabriel Kolko shows in the brilliant essay attached below, the post war solutions of NATO and the European Union, together with the exigencies of the Cold War, put these questions on hold, but their fundamentals remained, sleeping beneath the surface, and today, the conflicting questions of nationalism and German power are again coming to the fore to create ominous problems for Europe and the world.
There can be no question that, until 2007 or so, the European Union — particularly the opening of borders, the free flow of labour and capital, the disappearance of tariffs, and diminution of non-tariff trade restrictions, etc. combined to make life better for the mass of average Europeans. Standards of living rose steeply and social services improved in parallel. This was particularly evident in the poorer EU countries on the southern rim. I saw and experienced this astounding improvement in the quality of life on a very personal level, living on a sailboat in southern Europe since the summer of 2005. I will never forget the comment made to me by an Italian psychologist in Calabria in 2006, which is the heart of the provincial south of Italy, “It is a great time to be a European.” To be sure, he was an educated member of the upper middle class, and not representative of the average Calabrian, but it struck me that this Calabrian saw himself as a European. It was not very long ago, that such a person would only loosely consider himself to be an Italian, not to mention a European.