The Agonist: Don’t Be Fooled by Wall Street’s Happy Talk

http://agonist.org/numerian/20080613/dont_be_fooled_by_wall_streets_happy_talk

The next phase of the financial and economic crisis is creeping up on us. You can see the signs in the U.S. stock market, where all the major indexes have reversed a three month rally and are now declining back to their March lows. This decline is led by the Dow and is in fact accelerating, taking with it last month’s cheerful prognostications that the U.S. not only has escaped a recession, but is bouncing back into full growth mode for the second half of this year.

The economic data do not confirm this picture at all. The employment situation continues to worsen, industrial production and factory utilization are lodged firmly in recessionary territory, and the only retail stores showing any sign of life are the deep discounters like Wal-Mart, benefiting temporarily from the tax rebates. Wall Street executives are telling us that the credit crisis is halfway over, but their behavior suggests otherwise. Lehman Brothers, for example, assured us last week that it was well-capitalized and fully in control of its future, but a few days later it announced a $2.8 billion loss and was forced to turn to the stock market and private investors to raise $6 billion more in capital. Where have we heard this story before?

Wall Street continues to underestimate the spreading default carnage that is going to bring down a few more financial powerhouses before this crisis is over. The big story emerging in the housing markets is the galloping number of foreclosures affecting “decent ordinary folks” with prime mortgages (as opposed to the sub-prime customer species that kicked off the housing market crisis). Defaults and foreclosures on alt-A and prime mortgages are jumping to record levels. It seems that quite a lot of these customers, just like their sub-prime brethren, never really had much equity in their houses in the first place, and now that housing prices are declining across the nation, nearly 20% of them are in a negative equity position. If you can’t afford the mortgage in the first place, why continue to make payments on a property that is continuing to lose value?

These people are not typically walking away from their mortgages, as the “jingle mail” stories suggest. They would like to stay in their homes, but they can no longer make the payments. In many cases, the financial entity that they need to talk to in order to obtain some relief is a “mortgage servicer” who doesn’t own the mortgage, and can’t possibly get agreement from all the hundreds of investors worldwide who own a tiny sliver of the mortgage that was long since sold off in a security. Congress can pass all the legislation it wants to provide relief from foreclosure for these homeowners, but it will be mostly fruitless. The securitization of mortgages in the past eight years has legally and practically destroyed the ability for the financial industry to come through with any accommodations, so the homeowner is ejected and the banks wind up owning the property.

The banks now own so many homes through foreclosure that cities across the U.S. are suing them to force them to keep the properties in decent shape. It most places it costs thousands of dollars to get the lawn mowed and trash picked up, and there are many circumstances where the home has been vandalized, costing the banks much more. The banks are learning a terrible lesson last experienced in the Depression – foreclosure is something to be avoided at all costs. It doesn’t just destroy the profit a bank may have had in the mortgage – it can destroy the bank. We are now seeing banks dump whole subdivisions onto the real estate market at 20% of the value at the market peak in 2006.

The bond market has learned that the mortgage crisis is just the beginning of the problems that banks are facing. Stage two is underway with deterioration in corporate debt, starting with the bonds issued by real estate developers, but spreading now to the high yield securities and bank loans of poorly capitalized and over-leveraged corporations. Well over 50% of all the corporate debt issued in the past eight years has been rated as junk debt, meaning it is not even investment grade (Baa rated or higher) and it has a very high probability of default. These probabilities are now working against the holders of these bonds, and the banks that have lent to these companies.

In normal circumstances the economy can work through these excesses, as consumers and corporations reduce their leverage and banks absorb the losses on bad debts. But these aren’t normal circumstances. The U.S. is no longer entirely in control of its economic destiny, and it isn’t even the engine that drives the global economy. China and India have created their own self-reinforcing economic dynamic, in which exports finance a growing demand for raw materials, starting with oil. As the price of petroleum has now crossed $130/bbl., an intolerable burden is being placed on a U.S. economy sinking in recession.

Consumers are increasingly turning to public transport – if it is available – to avoid paying over $4/gal. for gasoline. Part of the pricing pressure on the suburban McMansions built in the past five years comes from the cost of commuting to these homes built 50 miles or more from any jobs. Independent truck drivers are going out of business because the cost of diesel fuel over $5/gal. has shredded what were already dangerously thin profit margins. Their trucks are piling up on dealer’s lots, and used car dealers are now hesitant to accept any more SUVs. General Motors is thinking of canceling altogether its Hummer model, a war-chic road hog that at its best gets only 11 miles to the gallon.

The high price of oil is now clearly affecting all facets of the global economy, with one exception: wages. Workers are not being given pay increases, but instead are being pressed to put in longer hours, which is always management’s way of coping at first with an economic downturn. But usually around six months into a recession, companies cave in to reality and start letting people go. We’ve just passed the six month mark for this downturn, so expect the unemployment data to noticeably deteriorate; last month the unemployment rate jumped up ½% of a percentage point alone.

Just about the last people in America to recognize that we have an inflation problem are the esteemed governors of the Federal Reserve, who preferred to concentrate on the fictitious construct of “core inflation”, which eliminates from the calculation energy and food costs. But even Fed chairman Ben Bernanke is now beginning to face up to everyday reality, and has announced this month that Fed policy is now focused on combating inflation and fighting any further depreciation of the dollar on the foreign exchange markets. The days of interest rate declines are over, and the market is now estimating there is more than a 75% chance that the Fed will raise interest rates at their next Open Market committee meeting.

That’s just what the economy needs: higher interest rates on top of raging energy and food inflation, at the same time the entire housing sector is deflating. Obviously the Fed wouldn’t be piling on to our economic woes if it had a choice. The fact that it has no choice, and that it is trapped in the policy dilemma it now faces, is in good part its own fault. It’s not enough to blame China and India for oil price increases. There is still a lot of loose cash around the world that is being pumped into oil futures, which has helped as well to push prices to record levels. Most of this loose cash has been generated by the United States. We continue to flood the world with Treasury securities to finance both our domestic federal budget deficit, and our current account deficit, which combined exceed $1.5 trillion per year. On top of this, Bernanke’s dramatic interest rate cuts in the past six months have added yet more “liquidity” to the market. The banks aren’t using these funds to make loans, and investors aren’t eager to plow the money into the stock market given the inevitable decline ahead in corporate profits. That leaves the last great bubble as the only investment alternative: the commodities market, and specifically energy.

You’ve read no doubt about the nasty speculators who are involved in the commodities bubble. While there are certainly hundreds of hedge funds engaged in this speculative exercise, most of the money is coming from staid mutual funds, pension plans, university endowments, and other respectable entities desperate to find some investment vehicle that returns anything even matching the rate of inflation. Senator Joe Lieberman already has a bill submitted to restrict speculators from investing in commodity funds, but we’ll see how far this measure gets when Yale University’s endowment management have a quiet word with him about just who is going to get hurt if the bill is passed.

What can we expect in stage two? Expect first of all for the credit crisis to return with a vengeance. The omens are already lining up. Remember when Congress was all excited a few months ago about turning loose the Federal Housing Administration, and allowing them to jump-start the mortgage market with low-cost loans and down payment guarantees? It turns out the FHA isn’t interested in these broad new powers. It has enough problems of its own with its existing portfolio, which took a $4.6 billion write-down this past quarter due to rising foreclosures. That ate up over 25% of the FHA’s equity, and the commissioner had to reassure the market that the FHA itself isn’t facing bankruptcy – it just may need to turn to the Congress for an “appropriation.”

Right behind the FHA will be Freddie Mac, the Home Loan Banks, and the behemoth of them all, Fannie Mae. All of these federally chartered agencies are under stress from the worsening housing crisis, and all of them operate on thin amounts of capital. Congress thinks at the moment it has the luxury of opening up the taps of federal largesse in order to do something about the housing crisis, but the reality is that the agencies set up to help at a time like this will all have their hands out looking for taxpayer money just so they can survive.

The second thing you should watch for is the coming wave of corporate and municipal bankruptcies. Too many corporations are poorly capitalized and completely unprepared to meet their liabilities in a weak economy. Too many state and local governments are seeing tax revenues plummet, just at a time when decades of promises on employee pensions and medical plans are coming due. Something will have to give here, and ultimately the weakest players will seek protection from the bankruptcy courts.

That will leave hundreds of thousands of retired government workers facing an abrupt shift in their fortune, and equally large numbers of currently employed workers suddenly facing unemployment. That’s the third thing you should watch for: large-scale layoffs in the public and private sector, with significant second order economic effects on consumer spending. This is all part of the vicious cycle common with recessions – stressed out employers let staff go, leading to declines in consumer spending, leading to yet more pressure on corporations and government to fire even more workers. The difference now is that the viciousness of this cycle will far outweigh whatever pain was experienced in the last oil recession of 1974. This recession will be lucky to avoid being labeled as a depression when it is over.

Fourth, this recession is spreading globally. Housing markets in the U.K., Spain, Australia and Ireland are all reversing direction and following the U.S. into an implosion of foreclosures. Energy costs are rising everywhere, driving up as well the cost of basic food and things like livestock feed and fertilizer. This has led to riots in many emerging markets where fundamentals such as wheat and rice are hard to come by. Even the oil producing countries in the Gulf States are not immune to food scarcities. Central banks everywhere are talking tough about battling inflation, and a few are raising interest rates. Many of them are also raising margin requirements in the commodities markets to prevent speculation, and there is widespread condemnation of profiteers.

This is a very nasty situation for the central banks, forced to choose between accepting inflation that is accelerating well beyond target ranges, or raising interest rates and throwing the global economy into a much worse recession. As part of this conundrum, there is serious doubt about the value of repeating the Fed’s rescue for a financial firm like Bear Stearns, but if another such disaster crops up, letting yet another large bank or broker fail could lead to a systemic crisis of unimaginable magnitude. At some point though, governments including their central banks have to do something about the plight of the average citizen rather than continue to coddle millionaire bankers. To do otherwise is to risk social disorder.

These dreadful policy choices are only now beginning to play out in the U.S. electoral campaign, which is also beginning to focus on the domestic burden of continuing to fund the Iraq war. The American public has already turned against this war because of the high price that is being paid in death and injury, but the interplay between the war and America’s economic woes is beginning to become apparent. You can expect the Democrats to emphasize this linkage, and to ask Americans how fair it is that they are spending $12 billion a month to build Iraq, a country rich in oil, when at home people are losing their jobs, their pensions, their medical insurance, and in many cases their homes and the ability to feed their family. It will be the first time that the electorate will have to confront the economic costs of maintaining the vast American empire.

There is a point of inflection in any economic crisis where it becomes apparent to everyone that something has gone dramatically wrong and painful course corrections are needed. It often takes a major bankruptcy, or a sharp rise in unemployment, or a stock market crash, to awaken the public to the realities they have ignored or that have been hidden from them. The U.S. could experience any or all of these calamities, and at any time now. Heaven help the Republicans if this should occur prior to the first Tuesday in November.

The Irish People have spoken: Lisbon Is Dead

Source: Mike Whitney, Information Clearing House.

On Friday, Ireland delivered a knockout punch to European elites and corporatists and shattered their plan for an EU Superstate. The so-called Lisbon Treaty was nothing more than a repackaging of the European Constitution that was defeated by French and Dutch voters in 2005. The treaty was loaded with the typical “democratic” gobbledygook to conceal the vicious neoliberal policies at its heart. If it had passed, the treaty would have paved the way for greater privatization of public services, diminished workers rights, less state control over trade policies and civil liberties, and an aggressive plan to militarize Europe. Ireland’s entire political and corporate class stood foursquare behind the treaty, but the Irish people shrugged off the fear-mongering and bogus promises of prosperity and voted No. The referendum results showed 53.4% voted No, while 46.6% voted Yes. Despite the massive public relations campaign; the vote wasn’t even that close.

A spokesperson for the No campaign put it like this:

“The Irish people have spoken. Contrary to the predictions of social and political turmoil, we believe that hundreds of millions of people across Europe will welcome the rejection of the Lisbon Treaty. This vote shows the gulf that exists between the politicians and the elites of Europe, and the opinions of the people. As in France and the Netherlands, the political leaders and the establishment have done everything they could to push this through – and they have failed. The proposals to further reduce democracy, to militarize the EU and to let private business take over public services have been rejected. Lisbon is dead. Along with the EU Constitution from which it came, it should now be buried.” (Socialist Worker online)

News of the defeat has not been well received in England where the government of Gordon Brown has already indicated that it will reject the election results and “press ahead” in an effort to ratify the treaty. Neither Brown nor his friends in Brussels are likely to be deterred by anything as trivial as the will of the people. Labour MP and former Europe Minister Denis MacShane summed it up like this:

“I personally think that a vote in a foreign country should not determine the democratic decisions taken in the British Parliament.”

MacShane’s view is apparently shared by EC President Jose Manuel Barroso who said that EU member states should continue ratifying the Lisbon treaty even though more than half of Ireland’s 43 constituencies rejected it outright. So much for democracy.

The Irish have plenty to celebrate today. They’ve thrown a spanner in the plans of the bankers and corporate mandarins who want to replace representative government and national sovereignty with their own skewed vision of capitalist Valhalla; a Euro Utopia where short-term profits always take priority over the needs of people.

Bravo, Ireland.

Gore Vidal’s Article of Impeachment

It’s not just Le Monde, but even t.v. coverage of U.S. events in other countries is better than it is here. They aren’t afraid to show graphic images of the Iraq War either. No wonder the U.S. is so unpopular.

Source: Gore Vidal, Truth Dig.

On June 9, 2008, a counterrevolution began on the floor of the House of Representatives against the gas and oil crooks who had seized control of the federal government. This counterrevolution began in the exact place which had slumbered during the all-out assault on our liberties and the Constitution itself.

I wish to draw the attention of the blog world to Rep. Dennis Kucinich’s articles of impeachment presented to the House in order that two faithless public servants be removed from office for crimes against the American people. As I listened to Rep. Kucinich invoke the great engine of impeachment – he listed some 35 crimes by these two faithless officials – we heard, like great bells tolling, the voice of the Constitution itself speak out ringingly against those who had tried to destroy it.

Although this is the most important motion made in Congress in the 21st century, it was also the most significant plea for a restoration of the republic, which had been swept to one side by the mad antics of a president bent on great crime. And as I listened with awe to Kucinich, I realized that no newspaper in the U.S., no broadcast or cable network, would pay much notice to the fact that a highly respected member of Congress was asking for the president and vice president to be tried for crimes which were carefully listed by Kucinich in his articles requesting impeachment.

But then I have known for a long time that the media of the U.S. and too many of its elected officials give not a flying fuck for the welfare of this republic, and so I turned, as I often do, to the foreign press for a clear report of what has been going on in Congress. We all know how the self-described “war hero,” Mr. John McCain, likes to snigger at France, while the notion that he is a hero of any kind is what we should be sniggering at. It is Le Monde, a French newspaper, that told a story the next day hardly touched by The New York Times or The Washington Post or The Wall Street Journal or, in fact, any other major American media outlet.

As for TV? Well, there wasn’t much – you see, we dare not be divisive because it upsets our masters who know that this is a perfect country, and the fact that so many in it don’t like it means that they have been terribly spoiled by the greatest health service on Earth, the greatest justice system, the greatest number of occupied prisons – two and a half million Americans are prisoners – what a great tribute to our penal passions!

Naturally, I do not want to sound hard, but let me point out that even a banana Republican would be distressed to discover how much of our nation’s treasury has been siphoned off by our vice president in the interest of his Cosa Nostra company, Halliburton, the lawless gang of mercenaries set loose by this administration in the Middle East.

But there it was on the first page of Le Monde. The House of Representatives, which was intended to be the democratic chamber, at last was alert to its function, and the bravest of its members set in motion the articles of impeachment of the most dangerous president in our history. Rep Kucinich listed some 30-odd articles describing impeachable offenses committed by the president and vice president, neither of whom had ever been the clear choice of our sleeping polity for any office.

Some months ago, Kucinich had made the case against Dick Cheney. Now he had the principal malefactor in his view under the title “Articles of Impeachment for President George W. Bush”! “Resolved, that President George W. Bush be impeached for high crimes and misdemeanors, and that the following articles of impeachment be exhibited to the United States Senate.” The purpose of the resolve is that he be duly tried by the Senate, and if found guilty, be removed from office. At this point, Rep. Kucinich presented his 35 articles detailing various high crimes and misdemeanors for which removal from office was demanded by the framers of the Constitution.

Update: On Wednesday, the House voted by 251 to 166 to send Rep. Kucinich’s articles of impeachment to a committee which probably won’t get to the matter before Bush leaves office, a strategy that is “often used to kill legislation,” as the Associated Press noted later that day.

Bob Chapman: The Formula For Hyperstagflation

How come you don’t hear much about the Airbus Defense Contract scam?

Source: The International Forecaster.

Inflation predicted over the next year, expect rate hikes over the next 12 – 18 months, failures pile up, failed measures to save the economy to have a cumulative effect, orgy of Wall Street fraud causes credit crunch, a worldwide disaster in the making, commodities rigging has a golden lining

The acceleration of inflation is baked into the economic cake for, at minimum, the next 12 to 18 months worldwide. Fed jawboning won’t change that. Phony PPT dollar rallies won’t change that. Fed rate hikes won’t change that. The reduction of money and credit won’t change that. Falling oil prices won’t change that. Lies about economic statistics, and especially about inflation data, won’t change that. So, why can’t the rate of inflation be changed for the next 12 to 18 months, you might ask? The reason is because inflation is not determined by smoke and mirrors, or by gimmicks and false data. It is determined by the rate at which the total supply of money and credit is being expanded or contracted (what economists call M3), which is measured by determining how much money and credit is being fed into, or subtracted from, each nation’s financial system by its central bank over the course of a given month, as compared with the amount determined for the previous month. That figure is then annualized. Basically, the annualized rate of M3 that is determined for any nation becomes that nation’s rate of inflation (expansion) or deflation (contraction), with a delay that usually runs about 6 to 18 months.

Contrary to what the fane-stream media, pusillanimous pundits and Wall Street shills might tell you, inflation is caused by too much money and credit chasing after too few goods, and today’s oil and food crisis is now providing everyone with a textbook example of how profligate expansion of money and credit can ruin an economy in a frighteningly short period of time. The baked-in inflation rate for the US will run from its current 12.625% to as high as 18% over the next 12 to 18 months, even if the Fed totally cuts off all money and credit tomorrow and then throws rate hikes in for good measure! Our current actual (as opposed to official) rate of inflation of 12.625% is running at a lag of about one year from the time M3 had reached the 12.625% level, and that is why we see 12 to 18 more months of 12.625% to 18% inflation. We have extended our projection out to 18 months because we do not see M3 going below 12% any time soon.

If the Fed and the traitors in the White House and Congress want to see stagflation gone wild, just go ahead and let the Fed raise rates and/or contract the supply of money and credit. The baked-in inflation will then continue even as the economy goes into a thermonuclear meltdown! The Dow will lose 500 to 1000 points on each .25% rate hike as de-leveraging accelerates, margins are tightened and liquidity is drained from the system. Bond markets will be destroyed as principal plummets. The situation is now so bad that even a substantially weaker yen cannot bring enough carry trade liquidity into the system to hold up the general stock markets. It now takes 3.5 more yen to buy a dollar or a euro than it did with the Dow was just over 13,000, yet the Dow is now at just over 12,300. Part of the current stock market weakness is due to the lack of support from the PPT, which is trying to minimize the liquidity and profits available to large specs that could be used to rally metals. Hence, the need for protective derivatives.

Further, any dollar strength achieved by any such Fed rate hikes will have little impact on gold and silver because the resulting destruction of the economy will send everyone to gold and silver as the safe-haven of choice. Treasuries and money markets will still be yielding negative rates of return while the banks are getting hammered by the next round of the ongoing real estate debacle. As attention moves from the hundreds of billions of toxic waste held by banks in off-balance sheet SIV’s to the hundreds of billions in toxic waste held by banks in off-balance sheet VIE’s (Variable Interest Entities), any dollar-denominated treasuries and money markets aren’t going to cut it any more as the real estate market drops into an even deeper, darker pit, sending the various real estate derivatives, and bank balance sheets, further down into the depths of the abyss. You will then watch precious metals go up with the dollar instead of running contrary to one another, and food and energy commodities might keep going up as stocks, bonds and other paper assets continue to be shunned by traders despite the stronger dollar. Throw in bank failures, heavy toxic waste write-downs, earnings disappointments, a consumer spending crisis, a credit default swap crisis, a new false-flag attack and/or a new theatre of conflict, and only precious metals will be going up with oil as the dollar gets taken out by the ensuing recession.

Rate hikes, coupled with weaker real estate values, and thus huge declines in both bond principal value and bond collateral value, could set off a bear market in bonds that could take the whole system down even more quickly than the credit-crunch and subprime debacles combined.

Note that when the Fed was on its rate hike campaign that terminated at 5.25%, inflation continued to grow because M3 was wildly expanded during the entire rate hike campaign. That is what separates the current inflationary debacle from all other periods of inflation. During all other periods of high inflation, the cure for an overheated economy was applied by either an increase in interest rates or by a contraction in M3, or by both. The current inflationary cycle is the first period of high inflation where interest rate hikes were totally offset, and overwhelmed by, the expansion of money and credit which totally negated any slowing of the economy that might have been achieved by the rate hikes. The Fed, Wall Street and our bought-off and compromised government officials conspired to keep up the speculation that was used to power the ongoing derivatives fraud by pumping out prodigious amounts of money and credit while lying to us about inflation, which was skyrocketing as a result. That is the precise reason why the Fed’s rate hikes failed to cool the economy and to slow inflation. Instead, the derivatives fraud led to the credit-crunch, which then cooled our economy. Then, in order to attempt to save our economy, rates had to be cut back by the Fed while money and credit were expanded even further, the perfect formula for hyperinflation which you are now witnessing as we write this issue of the IF. In addition, the economy was not saved, and now inflation is getting worse as the direct outcome of the failed measures to save our economy, thus causing further and additional damage to our economy as food and energy costs skyrocket and US consumers are tapped out. That, in turn, is the perfect formula for hyperstagflation.

Note that our economy was destroyed already before the credit-crunch by free trade, globalization, off-shoring, outsourcing and both legal and illegal immigration, and now we have rampant inflation to boot. Precious metals and their related shares, professionally managed Forex accounts and Swiss franc-denominated government bonds are your only options at this point to avoid being beggared and impoverished by the Illuminati.

As mentioned above, an orgy of Wall Street fraud has brought us an economy-killing credit-crunch. That credit-crunch has forced the Fed to initiate a maniacal expansion of money and credit to keep Illuminist insider financial institutions from imploding. Much of the money and credit from that maniacal expansion is not being re-loaned because all confidence in the system has been lost due to rampant, rampaging fraud, much of which was committed by Illuminist insiders against other Illuminist insiders, proving once again that there is no honor among thieves. So where is this huge portion of all that money and credit going if it is not being re-loaned? A very large portion is being used to make substantial, speculative profits from a whole bevy of commodities, especially from crude oil and agricultural products, by virtue of a loophole provided by the depraved group of village idiots who run our country (Congress), a loophole that allows big banks to operate in the commodities markets without position limits, allowing them to run amok in those markets with privileges that are not extended to other, non-elitist players. Our government regulators always provide us with such a level playing field, don’t they? What an absolute disgrace.

Inflation is destroying the world economy as central banks around the globe pump out money and credit until it inundates everything, and the leading creator of inflation and destroyer of the world economy is the Federal Reserve, a private banking concern, a majority of which is owned by two shareholders, namely, JP Morgan Chase and Citigroup, the main fraudsters of Wall Street. Wherever you see financial chicanery, these two malfeasants are usually somewhere in the mix. Ask Enron and Bear Stearns shareholders. And now the Fed’s machinations, in cahoots with elitist banks around the world, have caused a worldwide stock market crash and have sent the world financial system into an inflationary quagmire, perhaps to pave the way for world government. You have already seen us drop from a high last year of about 14,200 on the Dow to today’s roughly 12,300, a 13%+ loss. That would have been triple or quadruple were it not for the PPT. Then there is China, whose stock market has shed 50% from its peak, India, whose markets have shed 27% from their peak, Japan, whose stock markets have been in a state of implosion for two decades and Brazil, which is about to watch its currency implode for the second time in a decade. China uses 5 times more oil per unit of GDP produced than does the US. What do you think oil prices are doing to them? So much for free trade and globalism, and so much for the hypothesis that emerging markets can carry the world financial markets while the US and other western economies in Canada and Europe go under. What you have is a worldwide disaster in the making, with food shortages, starvation, social upheaval and revolution on their way. The would-be lords of the universe have really done it this time. We expect that very few of them will survive when people find out what they have done.

Robert the Bruce stopped the British Black Nobility from imposing their draconian feudal system on Scotland in 1314 at the Battle of Bannockburn. Our Founding Fathers fought and won two wars against the perfidious British Black Nobility to keep them from imposing their mercantilism and European-style, debt-based, private fractional reserve banking system on America with victories in the Revolutionary War and the War of 1812. Now we can add Ireland, whose citizens have stopped the European Union and its free trade, globalist agenda, both supported by the British Black Nobility and the other Black Nobility of Europe, dead in their tracks with a vote against the Lisbon Treaty, which was the EU’s attempt to short circuit the common folk of Europe to establish their regional dictatorship and regional currency in preparation for a diabolical one-world government and one-world currency. Let’s hope that the citizens of the US do the same with the clandestine North American Union and the Amero. This adds to the EU’s woes as a one-interest-rate-fits-all policy continues to alienate the weaker EU members from the EU’s economic powerhouse, Germany, the vast majority of whose citizens want their old Deutsche Marks back. While that group of weaker members may include Ireland, and while Ireland has shown considerable weakness from an economic point of view lately, that weakness does not appear to extend to their political wisdom. Let’s hear it for the Irish! ERIN GO BRAGH!!!

Retail sales rose 1.0% for the month of May. Big whoop! That figure is not adjusted for the actual rate of inflation, which also just happens to be approximately 1.0% per month here in the US. That means retail sales were actually flat, with all growth attributed to price increases and not a smidgeon to an increase in the amount of goods which consumers purchased. Thus, our 160 billion-stimulus package netted a big fat goose egg.

It is clear that oil and food are being driven up while gold and silver are being suppressed, so that when it comes time for the next precious metals rally, everything else will be hit and the dollar will be talked up. Apparently the cartel has not yet figured out that all the money from the sell-off of oil and other commodities will have to find a home somewhere, and precious metals are a very likely resting place. No one believes anything emanating from Bernanke, the Fed or our Treasury anymore. They have been dead wrong about every prediction they have made, and have lied pathologically. We will likely see rate cuts before we ever see rate hikes. The next debacle is on its way, and as soon as Ben the Bear Killer gets wind of it, he’ll drop rates faster than JP Morgan Chase took over Bear Stearns with a big, juicy taxpayer gift courtesy of the Fed. Meanwhile, we must endure the poppycock drivel that the Fed and our Treasury support a strong dollar, with M3 still over 16% and ongoing, unbridled speculation by banks in the commodities markets with easy cash and credit from the Fed, received in exchange for toxic waste collateral. Again, perfect.

Not only does the nominal price of gold and silver tell you how desperate we are financially, but the degree of manipulation should also be considered. If gold and silver are used as hedges, especially gold, then why do they go down when everything else is going up? Oil was only at 112 when gold was over 1000. Now we have 870 gold with oil at 135 and many food commodities doubling, tripling and quadrupling. Does that make any sense to anyone? If it does, then they are either a cartel insider, or they are just plain dumb. Three cheers for ETF’s and mint certificates, backed by the gold and silver of the proletariat which is now being used by the elitists to suppress precious metals by selling and leasing the very gold and silver which the duped proletariat think they own, while resource shares are ignored or naked-shorted. This transpires as bullion banks are paid to take out short-term silver leases and as specs continue to gamble in rigged casinos owned by the elitists while refusing to purchase and take possession of their gold and silver for cash. Welcome to corporatist, fascist America, where the sheople continue to confirm P. T. Barnum’s famous quote. Detach yourself from the Matrix, or get reamed.

If you think employment is bad now, wait until thousands of municipalities go bankrupt. They are the only ones making any significant contributions of good-paying jobs at this point. Their tax receipts are dropping into the tank as their bond insurers go belly up, as their ratings drop off a cliff, as their lending rates double, triple or more, and as the auction rate municipal bond market goes the way of the dodo bird, while the 330 billion owned by auction rate municipal bondholders goes up in flames since there exists no market where they can be sold, and bank’s do not intend to revive the old one. The state and local governments are about to join consumers in the big “Sorry-We’re-All-Tapped-Out” final binge party as they make appointments to have consultations with their bankruptcy attorneys. This transpires as they are forced to take over houses that have been abandoned by people who should never have owned them in the first place and as they make accommodations for the tent cities that are growing in size and number by the hour. Wonder what corporate earnings will look like when the municipal tits are shut off.

Previously our Defense Department gave a $35 billion air fleet tanker contract to EADS, which manufactures the Airbus, rather than to Boeing – a contract that should have never been written in the first place. The US doesn’t need the tankers. In that process 44,000 well paying US jobs were lost to Europeans. As it turns out the bid-awarding process was corrupt. The EADS fleet will cost American taxpayers dearly and the model is less safe than the Boeing model. Boeing could have saved taxpayers $90 billion. The EADS contract will cost us $40 billion. The aircraft is less capable. EADS is using illegal subsidies. EADS won exemptions from key national security laws. The Boeing model produces 25% less carbon dioxide, reducing greenhouse gases and offers a 24% fuel savings – a cost borne by taxpayers. Even as the contract for $40 billion is being handed over, the federal government is aggressively pursuing legal action against EADS at the WTO for getting grants and loans at unfairly favorable rates.

The key Senator John McCain (R-AZ) played a crucial role in blocking the deal to build air tankers from going to Boeing. The position fattens his campaign coffers.

The question is who arranged the payoffs and who received them?

Look Out for Another 9/11 and State of Emergency: The US in the Final Six Months of Bush/Cheney Administration

by Lewis Seiler and Dan Hamburg, Common Dreams.

In short, we are living in an on-going state of emergency whose exact limits are unknown, on the basis of a controversial deep event — 9/11 — that is still largely a mystery.
- UC Professor Emeritus Peter Dale Scott

Unhindered by a neutered Congress and a compliant Court, President Bush has six months remaining to pursue his agenda of expanding the war in the Middle East and ensuring the continuation of the Global War on Terror (GWOT) beyond his tenure in office.

The current administration has taken unto itself unprecedented, nearly hegemonic powers since the events of 9/11. On that day, George W. Bush issued his “Declaration of Emergency by Reason of Certain Terrorist Attacks” under the authority of the National Emergencies Act. This declaration, which can be rescinded by joint resolution of Congress, has instead been extended six times. In 2007, the declaration was strengthened with the issuance of National Security Presidential Directive 51 (NSPD-51) which gave the president the authority to do whatever he deems necessary in a vaguely defined “catastrophic emergency” including everything from canceling elections to suspending the Constitution to launching a nuclear attack.

Despite time constraints, there are clear signs that the president, the vice-president and their neocon collaborators are not finished. The constant saber-rattling toward Iran, with strong support from Israel, should send a chill down the spine of any peace-loving American. Military chiefs who oppose the president are “retired,” as observed most recently with the March dismissals of CENTCOM commander Admiral William Fallon and 6th Fleet commander Vice-Admiral John Stufflebeem. Public opinion counts for nothing. In a March 24 interview with ABC’s Martha Raddatz, vice president Dick Cheney responded to a question about the war weariness of Americans with a languid “So?”

According to J. Scott Carpenter, former deputy assistant secretary of state for Near Eastern Affairs, Cheney pushed hard for airstrikes against Iranian Revolutionary Guard bases last summer. He was deterred by Pentagon officials who insisted that retaliation might be difficult to contain. Now, with Cheney ally General David Petraeus poised to take over Fallon’s command, a significant obstacle has been removed.

It seems clear that there is a deadly struggle going on within the US government, a struggle that could well determine not only the election of the next president, but the survival of the republic. On one side are the neocons, the fanatics who led us into Iraq and who believe they alone possess the strategic acumen to usher in a “new American century.” On the other is the Republican Party old guard ostensibly led by Defense Secretary Robert Gates. Gates was brought into the administration at the end of 2006 to replace the disgraced and despised Donald Rumsfeld, and generally to ride herd over the neocons.

The conflict between these factions has broken into the open over the past eight months. The first public signal came in October of last year, when the sixteen US intelligence agencies issued a consensus National Intelligence Estimate (NIE) that cut the legs out from under the administration’s argument that Iran was on the verge of developing a nuclear weapon. The NIE stated that the Iranians had stopped work on the project in 2003.

Just before Labor Day last year, a B-52 Stratofortress bomber carrying six cruise missiles armed with nuclear warheads flew an unauthorized mission from Minot AFB in North Dakota to Barksdale AFB in Louisiana. Due to anonymous, high-level tips to the Military Times, the warheads were recovered. After several seemingly inconclusive investigations of the incident, Pentagon chief Gates fired Air Force Chief of Staff Michael Moseley and Air Force Secretary Michael Wynne last week, without revealing the role either man played in the nuke heist. Given the volume of evidence that this unprecedented transfer of live nuclear weapons was not an accident, the question remains: what individual or individuals within the government have the authority to commandeer nuclear bombs?

Conservative pundit Patrick J. Buchanan recently suggested that the neocons might be tempted to go to war with Iran in order to improve John McCain’s chances of winning the presidency. As audacious as that seems, we want to go one step further. We believe that this administration is so zealous, so determined to hold onto power, that they may well stage a “false flag” attack, creating just the kind of “catastrophic emergency” to which NSPD-51 refers.

On April 29 of this year, CIA veteran Roland V. Carnaby was shot dead by police officers after a high speed chase through the streets of Houston. Carnaby, who had been the CIA’s Chief of Station for the Southeast Region headquartered in Houston, was involved in conducting security surveys of the Port of Houston and had discovered that the Department of Homeland Security was tolerating gaping holes in port security. Carnaby and Houston intelligence and law enforcement personnel were also investigating the presence of “Middle Easterners” who were conducting surveillance of the Port of Houston. The “Middle Eastern” designator is the term used by the FBI for Israelis (typically Mossad agents) in order to avoid “political” problems with superiors.

Former National Security Agency analyst and naval intelligence officer Wayne Madsen has been in Houston investigating the Carnaby case at great personal risk. Madsen believes Carnaby was involved both in heading off a potential war with Iran (by leaking Mossad plans to assassinate Hezbollah leader Hassan Nasrallah just days before Carnaby himself was killed) and in trying to forestall a potential terrorist attack on the port.

According to Madsen, “federal agents in Houston fear that ‘another 9/11-type part false flag’ attack is imminent, perhaps as early as July 4.” Such an attack along the twenty-five-mile Houston Ship Channel, site of more explosive materials, toxic gases, and deadly petrochemicals than anywhere else in the country, could create an environmental and economic catastrophe that would dwarf 9/11.

How will the struggle within this administration be brought to an end? Will courageous military men like Adm. Fallon speak out before the next national tragedy befalls us? Will Congress act decisively to remove the president’s emergency powers, challenge NSPD-51, and defend the Constitution? Will Defense Secretary Gates hold the line?

With just a half year left in what many believe has been the worst presidency in American history the possibilities are many, and some of them are truly frightening. As citizens of this country, we must do everything in our power to ensure that there is no expansion of war in the Middle East, no “false flag” attack at the Port of Houston or anywhere else, and a peaceful and constitutional succession to a new administration.

Lewis Seiler is president of Voice of the Environment, Inc. Dan Hamburg, a former US representative, is executive director.

Pennsylvania Township Challenges Corporate Personhood as it Bans Corporations from Dumping Sludge & Mining Wastes

There’s still some hope left in small local governments, depending on how corrupt the officials are.

Source: Precaution.org.

Chambersburg, Pennsylvania — On June 11, 2008, the Board of Supervisors for Packer Township in Carbon County, Pennsylvania, voted unanimously to enact a law that bans corporations from dumping sewage sludge as “fertilizer” and for “mine reclamation.”

The Ordinance also states as a matter of law that, within the community, corporations possess no constitutional “rights,” privileges or immunities intended for people. The community included this provision as a challenge to corporate representatives who use court- bestowed constitutional “rights” and legal privileges to nullify local laws and override the legitimate rights of citizens.

Board Chairman Thomas Gerhard stated, “We felt that it was in the best interests of the residents to adopt the ordinance.”

In adopting the law, Packer Township became the third local government in the country to define liability and impose penalties for chemical bodily trespass, following the lead of the Town of Halifax, Virginia, and Mahanoy Township in Schuylkill County, Pennsylvania.

The people of Packer Township also included a provision that recognizes the right of natural communities and ecosystems to exist and flourish within the Township, joining nine other communities that have asserted environmental protection as an enforceable right rather than a matter of discretionary convenience.

The Packer Township law

1) Bans corporations from engaging in the land application of sewage sludge;

2) Bans persons from using corporations to engage in the land application of sewage sludge;

3) Provides for the testing of sewage sludge prior to land application by individuals, with testing costs to be borne by the applicant;

4) Prohibits chemical bodily trespass upon residents of the Township;

5) Establishes strict liability and burden of proof standards for chemical trespass;

6) Removes claims to legal rights and protections from corporations within the Township;

7) Recognizes and provides for enforcement of rights of residents, natural communities and ecosystems;

Subordinates sludge hauling and disposing corporations to the People of Packer Township;

9) Adopts Pennsylvania regulations as locally enforceable concerning the land application of sewage sludge by individuals.

In the Ordinance, the Township Board of Supervisors declared that if state and federal agencies — or corporate managers — attempt to invalidate the Ordinance, a Township-wide public meeting would be hosted to determine additional steps to expand local control and self- governance within the Township.

The Ordinance was adopted following an attempt by nearby Tamaqua Borough’s Council Member Cathy Miorelli to investigate the dumping of over thirty loads of sludge uphill from the Still Creek Reservoir in Packer Township. The reservoir is the source of drinking water for surrounding communities, including Tamaqua.

Ms. Miorelli said that when she contacted the state’s Department of Environmental Protection (DEP) she hit a roadblock. “I asked [Tim Craven, the DEP representative] if the substance was permitted. He said he didn’t know and it would be pretty difficult for him to find out.” Craven then suggested the Council Member contact the land owner, but Ms. Miorelli advised the DEP rep that such an investigation seemed to be his responsibility. Pressing the issue, she was able to convince Mr. Craven to contact the land-owner, and in a follow-up call was told the land owner reported the substance to be “lime.”

According to a Times-News report “Everything changed on April 2, when Miorelli got a phone call from Craven, apologizing to her and saying that she in fact was correct and it was biosolid material [a PR term for sewage sludge developed by industry and adopted by State and federal agencies] from Philipsburg, N.J. that was dumped in the fields.

“Mayor Christian Morrison took issue with the fact that the DEP officials apparently lied and did not perform the appropriate inspections.

“‘This community has lost faith in DEP and this just doesn’t help,’ he said.”

Ben Price, Projects Director for the Community Environmental Legal Defense Fund, the organization that helped draft the Packer Township Ordinance said, “Once again, the people living within Pennsylvania municipalities have concluded that they must rely on themselves, and assert their right to govern locally on issues that directly impact the local community and environment. In the face of an apparent State policy of covering up and enabling waste hauling corporations to wield unjust law against Pennsylvanians and profit at the expense of our communities, Pennsylvanians are standing up.”

Passage of this Ordinance is especially significant at this time, since the Pennsylvania Attorney General is suing neighboring East Brunswick Township for adopting a similar Ordinance. Acting as private litigator for agribusiness and sludge corporations, under authority of a State statute lobbied for heavily by these industries, the PA Attorney General recently filed a legal brief requesting the court overturn East Brunswick’s Ordinance without giving the community its day in court. In that brief, the top law enforcement officer in Pennsylvania made this unequivocal statement his core argument for nullifying the local law: “There is no inalienable right to local self-government.”

It’s a point of view we see played out every day in communities across Pennsylvania and the United States. By enacting their new Ordinance, the community government of Packer Township has outshone its State counterpart by recognizing that the consent of the governed is a prerequisite for just governments and law.

The Community Environmental Legal Defense Fund, located in Chambersburg, has been working with people in Pennsylvania since 1995 to assert their fundamental rights to democratic self-governance, and to enact laws which end destructive and rights-denying corporate action aided and abetted by state and federal governments.

Legal Prescription Drugs Kill Far More Than Illegal Drugs, Florida Says

By Damien Cave, The New York Times.

The rate of deaths caused by prescription drugs was found to be three times the rate of deaths caused by all illicit drugs combined

From “Scarface” to “Miami Vice,” Florida’s drug problem has been portrayed as the story of a single narcotic: cocaine. But for Floridians, prescription drugs are increasingly a far more lethal habit.

An analysis of autopsies in 2007 released this week by the Florida Medical Examiners Commission found that the rate of deaths caused by prescription drugs was three times the rate of deaths caused by all illicit drugs combined.

Law enforcement officials said that the shift toward prescription-drug abuse, which began here about eight years ago, showed no sign of letting up and that the state must do more to control it.

“You have health care providers involved, you have doctor shoppers, and then there are crimes like robbing drug shipments,” said Jeff Beasley, a drug intelligence inspector for the Florida Department of Law Enforcement, which co-sponsored the study. “There is a multitude of ways to get these drugs, and that’s what makes things complicated.”

The report’s findings track with similar studies by the federal Drug Enforcement Administration, which has found that roughly seven million Americans are abusing prescription drugs. If accurate, that would be an increase of 80 percent in six years and more than the total abusing cocaine, heroin, hallucinogens, Ecstasy and inhalants.

The Florida report analyzed 168,900 deaths statewide. Cocaine, heroin and all methamphetamines caused 989 deaths, it found, while legal opioids — strong painkillers in brand-name drugs like Vicodin and OxyContin — caused 2,328.

Drugs with benzodiazepine, mainly depressants like Valium and Xanax, led to 743 deaths. Alcohol was the most commonly occurring drug, appearing in the bodies of 4,179 of the dead and judged the cause of death of 466 — fewer than cocaine (843) but more than methamphetamine (25) and marijuana (0).

The study also found that while the number of people who died with heroin in their bodies increased 14 percent in 2007, to 110, deaths related to the opioid oxycodone increased 36 percent, to 1,253.

Florida scrutinizes drug-related deaths more closely than do other states, and so there is little basis for comparison with them.

It has also witnessed several highly publicized cases in recent years that have highlighted the problem. Only last year, an accidental prescription drug overdose killed Anna Nicole Smith in Broward County.

Still, the state has lagged in enforcement. Thirty-eight other states have approved prescription drug monitoring programs that track sales. Florida lawmakers have repeatedly considered similar legislation, but privacy concerns have kept it from passing.

As a result, federal, state and local law enforcement officials say, Florida has become a source of prescription drugs that are illegally sold across the country.

“The monitoring plan is our priority effort, but that is not enough,” William H. Janes, the Florida director of drug control, said in a statement accompanying the study. He said Florida was also looking at ways to curb illegal Internet sales and to encourage doctors and pharmacists to identify potential abusers.

Some local police departments have taken a more novel approach.

In Broward County on May 31, deputies completed a “drug takeback” in which $5 Wal-Mart, CVS or Walgreens gift cards were distributed to 150 people who cleaned out their medicine cabinets and turned in unused drugs in an effort to keep them out of young people’s hands.

“The abuse has reached epidemic proportions,” said Lisa McElhaney, a sergeant in the pharmaceutical drug diversion unit of the Broward County Sheriff’s Office. “It’s just explosive.”

UK: Are we losing our civil liberties?

Ya think?

Source: Sarah Mill, Norwich Evening News.

New controversial legislation could now be put in place which means anyone suspected of being involved in terrorism can be held without charge for 42 days.

And with the government’s apparent determination to press ahead with a national ID card, as well as the huge expansion of biometric data, which means anyone’s fingerprints can be left on a database even if they are innocent, it is one of the most controversial issues in national politics today.

There are fears that foreign nationals will soon need to carry a card, followed probably by students, before others could be encouraged to follow.

There are also concerns databases will not work properly, or remain secure, after several recent government breaches of security.

These moves are seen by many as a gradual erosion of people’s civil liberties but by others as a positive move which, if it becomes law, means Britain will have the toughest anti-terror laws in the Western world.

Norwich North MP Ian Gibson claimed he was offered a key concession on his campaign to end sanctions against Cuba if he supported changing the maximum term a terror suspect can be held without charge from 28 to 42 days.

Dr Gibson, who is also the chairman of the all-party parliamentary group on the Communist state, was told the government would vote against the US-led sanctions in a future motion in Europe, something he has long campaigned for.

But, despite the offer, the Norwich MP was one of 36 Labour MPs to rebel against the government in a Commons poll.

He said: “I think we are turning into an oppressive legal system. ID cards, fingerprinting and the terror detentions are all taking away our basic human rights. None of it is necessary and it is scaring people because we are looking at a Big Brother form of rule and this is not acceptable in this day and age.

“We had 28 days and I think this is too long, I would like to see it go down not up.”

Conservative candidate for Norwich South, councillor Antony Little, said: “We have seen a massive expansion of CCTV; there is pressure on us to get ID cards, and now people can be detained for a long time without charge. The government is cramming in information but how do we know it is secure?”

North Norfolk MP Norman Lamb said he was worried our civil liberties were being lost.

He said: “Politics used to be divided between left and right but now it seems to be about whether we agree with enforcement or not. The use of ID cards is intrusive but the worst loss of freedom is being able to detain someone without trial and we need to be careful we do not turn into a surveillance society.”

ID cards are to become compulsory this year for non-EU foreign nationals living in Britain, and for 200,000 airport workers and Olympic security staff from next year. Parliament will decide whether the ID cards, which will cost £4.4bn, should be made compulsory for British citizens.

Kucinich Vows New Round of Impeachment Articles Against Bush If Measure Dies

I’m glad there’s someone in the Democratic Party with balls.

Source: Jason Leopold, The Public Record.

Dennis Kucinich, the Ohio Congressman and former 2008 Democratic Presidential candidate, said he would continue to introduce resolutions calling for the removal of President George W. Bush from office if the articles of impeachment against Bush that he presented to the House Monday is not taken up within 30 days or dies in committee.

On Monday, Kucinich introduced the articles of impeachment against President Bush in the form of a privileged resolution, a procedural maneuver requiring Congress to take up the measure within two legislative days. Kucinich spent four-hours reading 35 articles of impeachment against President Bush, accusing the commander-in-chief of a wide-range of “High Crimes and Misdemeanors,” such as lying to Congress and the public to win support for the Iraq war.

Congressman Robert Wexler, (D-Fla.), agreed to co-sponsor of the measure Tuesday.

Congress voted 251-166 Wednesday to send the articles of impeachment to a House Judiciary Committee for review where it’s expected to die.

But Kucinich said if that happens he will just introduce another resolution until lawmakers vote on the measure.

“Leadership wants to bury it, but this is one resolution that will be coming back from the dead,” Kucinich told the Washington Post Wednesday. “Thirty days from now, if there is no action, I will be bringing the resolution up again, and I won’t be the only one reading it. We’ll come back and many of us will be reading this [on the House floor], and we’ll come back with 60 articles, not 35.”

In a statement Wednesday, Kucinich urged the House Judiciary Committee to “begin a review of the 35 articles” and said he “will be providing supporting documentation to the committee so that it can proceed in an orderly manner.”

Kucinich said he expects to meet with Judiciary Committee Chairman John Conyers within a week to for the committee to vote on the measure. A resolution Kucinich sponsored last year to impeach Cheney was sent to Conyers’ committee but was not debated.

Conyers, as well as others in the Democratic leadership, has opposed initiating impeachment proceedings against President Bush. Conyers has said the House simply does not have enough votes to support impeachment and therefore pursuing it would be a waste of time.

He did, however, state in a letter sent to President Bush on May 8, that he would pursue impeachment if the president were to launch a military strike against Iran without first receiving approval or consulting Congress about the matter.

“Late last year, Senator Joseph Biden stated unequivocally that “the president has no authority to unilaterally attack Iran, and if he does, as Foreign Relations Committee chairman, I will move to impeach” the president.

“We agree with Senator Biden, and it is our view that if you do not obtain the constitutionally required congressional authorization before launching preemptive military strikes against Iran or any other nation, impeachment proceedings should be pursued,” Conyers’ letter says.

Kucinich said the articles of impeachment against President Bush are a way for lawmakers to “create an historical record of the misconduct of the Bush administration.”

“The weight of evidence contained in the articles makes it clear that President Bush violated the Constitution and the U.S. Code as well as international law,” Kucinich said in a prepared statement.

“It is the House’s responsibility as a co-equal branch of government to provide an effective check and balance to executive abuse of power,” Kucinich continued in the statement. “President Bush was principally responsible for directing the United States Armed Forces to attack Iraq.”

“I believe that there is sufficient evidence in the articles to support the charge that President Bush allowed, authorized and sanctioned the manipulation of intelligence by those acting under his direction and control, misleading Congress to approve a resolution authorizing the use of force against Iraq,” he added.

Democratic Speaker of the House Nancy Pelosi has said impeachment is “off the table” because it would hinder the Democrats’ chances of securing a bigger majority in Congress come November and could result in a public backlash and cause the party to lose the November presidential election.

“Speaker Pelosi will continue to lead legislative efforts to find a new direction in Iraq but believes that impeachment would create a divisive battle, be a distraction from Congress’s efforts to chart a new course for America’s working families and would ultimately fail,” Pelosi’s spokesman, Nadeam Elshami, told the Cleveland Plain Dealer Tuesday.

Congress has not considered impeachment because the Democratic leadership believes it will hurt their party’s chances of securing the White House in November’s hotly contested presidential election between Senators Barack Obama and John McCain.

Comment: That’s a lame excuse! There’s no chance in hell of McCan’t winning the election.

The Senate Select Committee on Intelligence agreed. Last week, the committee released a long-awaited report on prewar Iraq intelligence that concluded President Bush and Vice President Cheney knowingly lied to the public and to Congress about Iraq’s links to al-Qaeda and the threat the country posed to the U.S. in the aftermath of 9/11.

That would be an impeachable offense, according to former Nixon counsel John Dean.

“To put it bluntly, if Bush has taken Congress and the nation into war based on bogus information, he is cooked,” Dean wrote in a June 6, 2003 column for findlaw.com.

“Manipulation or deliberate misuse of national security intelligence data, if proven, could be “a high crime” under the Constitution’s impeachment clause. It would also be a violation of federal criminal law, including the broad federal anti-conspiracy statute, which renders it a felony “to defraud the United States, or any agency thereof in any manner or for any purpose.

Rumsfeld Personally Approved Brutal Interrogations

By Jason Leopold, The Public Record.

DOJ Official: Rumsfeld Personally Approved of Brutal Interrogations

Former Secretary of Defense Donald Rumsfeld personally authorized the use of brutal interrogation techniques against suspected terrorists imprisoned at Guantanamo Bay despite warnings from the FBI that the methods amounted to inhumane treatment, was possibly illegal, and would not produce reliable intelligence, a Department of Justice inspector general testified Tuesday.

“The FBI believed that these techniques were not getting actionable information, that they were unsophisticated and unproductive,” said Glenn Fine, the DOJ’s inspector general, in testimony Tuesday before the Senate Judiciary Committee. “They raised their concerns with the Department of Defense, but the Department of Defense, from what we were told, dismissed those concerns and that no changes were made in the Department of Defense’s strategy.”

Rumsfeld, who resigned immediately after the 2006-midterm elections, has vehemently denied that he approved of torture. The Justice Department’s Office of Legal Counsel provided the Defense Department with legal guidelines that authorized techniques such as waterboarding, the use of military dogs, and “slaps” and concluded that as long as “organ failure” did not occur the methods could not be construed as torture.

Fine issued a 437-page report last month on the Bush administration’s interrogation policies, which found that White House officials ignored FBI concerns about the treatment of detainees.

His testimony comes on the heels of a letter signed by 56 House Democrats that was sent to Attorney General Michael Mukasey last week Friday requesting that he appoint a special prosecutor to investigate whether White House officials, including President Bush, violated the War Crimes Act when they allowed interrogators to use brutal interrogation methods against detainees suspected of ties to terrorist organizations.

“The Bush administration may have systematically implemented, from the top down, detainee interrogation policies that constitute torture or otherwise violate the law,” the letter to Mukasey says. “We believe that these serious and significant revelations warrant an immediate investigation to determine whether actions taken by the President, his Cabinet, and other Administration officials are in violation of the War Crimes Act, the Anti-Torture Act, and other U.S. and international laws.”

In October 2002, Fine said, FBI agents raised concerns with Marion Bowman, the Justice Department’s deputy general counsel in charge of national security, about the methods used during interrogations at Guantanamo Bay. An FBI agent stationed at Guantanamo then sent the agency an analysis on November 27, 2002 calling into question the legality of the interrogation techniques, stating that the methods used appeared to violate the U.S. Torture statute. Bowman then alerted Jim Haynes, the DOD’s general counsel.

The same day Bowman raised concerns with Haynes, Haynes advised Rumsfeld to approve of the “enhanced interrogation” methods, according to Sen. Dianne Feinstein, (D-Calif.), who chaired Tuesday’s committee hearing.

“According to Mr. Bowman, Haynes claimed he didn’t know anything about the coercive interrogation techniques that were occurring at Guantanamo, despite the fact that he recommended on November 27, 2002, that Secretary Rumsfeld formally approve the very techniques that were being used at Guantanamo,” Feinstein said.

Rumsfeld, Fine told the committee, ignored FBI agents’ warnings and on Dec. 2, 2002 signed an action memorandum approving the use of “enhanced techniques” against prisoners at Guantanamo, concluding that the tactics stopped short of torture.

“These weren’t a few bad apples on the night shift, as we’ve been told,” said Senate Majority Whip Dick Durbin (D-Ill.) in response to Fine’s testimony.

On Nov. 23, 2002, four day before the FBI agent alerted the DOJ about interrogation tactics he witnessed, Rumsfeld verbally authorized interrogators to used harsh methods during their interrogation of Mohammed al-Qhatani, the so-called 20th hijacker, who was being held at Guantanamo. Al-Qahtani was sentenced to death earlier this year, but the Pentagon dropped war-crimes charges against him last month.

Torture Log

The harsh treatment of al-Qahtani was catalogued in an 84-page log of his interrogation that was leaked in 2006. The so-called “torture log” shows that beginning in November 2002 and continuing well into January 2003, al-Qahtani was subjected to sleep deprivation, interrogated in 20-hour stretches, poked with IV’s, and left to urinate on himself.

If al-Qahtani’s case had gone forward, the U.S. government would have been forced to reveal its own violations of the Geneva Convention, anti-torture statutes and the laws of war, according to lawyers representing al-Qahtani.

“All of the [incriminating] statements Mohammad al-Qahtani made or is alleged to have made were the result of torture or made under the threat of torture and that is in my view why the government decided to dismiss his case at this point,” said Vince Warren, executive director of the Center for Constitutional Rights (CCR) in New York.

CCR has been representing Mohammed al-Qahtani since 2005 and has led the legal battle for the human rights of detainees incarcerated at Guantanamo Bay, Cuba, for the last six years.

Army IG Report Fingers Rumsfeld

Dec. 20, 2005, Army Inspector General Report relating to the capture and interrogation of al-Qahtani included a sworn statement by Lt. Gen. Randall M. Schmidt. It said Secretary Rumsfeld was “personally involved” in the interrogation of al-Qahtani and spoke “weekly” with Maj. Gen. Geoffrey Miller, the commander at Guantanamo, about the status of the interrogations between late 2002 and early 2003.

Gitanjali S. Gutierrez, an attorney with CCR, said in a sworn declaration that his client, imprisoned at Guantanamo, was subjected to months of torture based on verbal and written authorizations from Rumsfeld.

“At Guantánamo, Mr. al-Qahtani was subjected to a regime of aggressive interrogation techniques, known as the ‘First Special Interrogation Plan,’ that were authorized by U.S. Secretary of Defense Donald Rumsfeld,” Gutierrez said.

“Those techniques were implemented under the supervision and guidance of Secretary Rumsfeld and the commander of Guantánamo, Major General Geoffrey Miller. These methods included, but were not limited to, 48 days of severe sleep deprivation and 20-hour interrogations, forced nudity, sexual humiliation, religious humiliation, physical force, prolonged stress positions and prolonged sensory over-stimulation, and threats with military dogs.”

According to the Schlesinger report, orders signed by Bush and Rumsfeld in 2002 and 2003 authorizing brutal interrogations “became policy” at Guantanamo and Abu Ghraib.

Hypocrisy

Ironically, Rumsfeld, as well as other senior Bush administration officials, expressed outrage in the first week of the Iraq War when Iraqi TV interviewed several captured American soldiers saying such behavior violated the Geneva Conventions. At a March 25, 2003, press briefing about progress in the US.-led invasion, Secretary Rumsfeld said, “This war is an act of self defense, to be sure, but it is also an act of humanity. … In recent days, the world has witnessed further evidence of their [Iraqi] brutality and their disregard for the laws of war. Their treatment of coalition POWs is a violation of the Geneva Conventions.”

The record now shows that during the same week in March 2003 – when Rumsfeld was publicly berating Iraq for violating the Geneva Convention by broadcasting footage of American POW’s – he was engaged in drafting a top-secret plan that would give military interrogators at Guantanamo wide latitude to use harsher techniques to obtain information from prisoners.

Rumsfeld signed off on the plan on April 2, 2003, according to documents declassified and turned over to the American Civil Liberties Union last month in response to a Freedom of Information Act lawsuit.

Though some of the more extreme techniques were dropped as the list was winnowed down to 24 from 35, the final set of interrogation methods Rumsfeld approved still included tactics for isolating and demeaning a detainee, known as “pride and ego down.”

“The most commonly reported technique used by non-FBI interrogators on detainees at Guantanamo was sleep deprivation or disruption,” Fine testified Tuesday. “Sleep adjustment” was explicitly approved for use by the military at Guantanamo under the policy approved by the Secretary of Defense in April 2003. Numerous FBI agents told the OIG that they witnessed the military’s use of a regimen known as the “frequent flyer program” to disrupt detainees’ sleep in an effort to lessen their resistance to questioning and to undermine cell block relationships among detainees.”

Additionally, Fine said, “Prolonged short-shackling, in which a detainee’s hands were shackled close to his feet to prevent him from standing or sitting comfortably, was another of the most frequently reported techniques observed by FBI agents at Guantanamo. This technique was sometimes used in conjunction with holding detainees in rooms where the temperature was very cold or very hot in order to break the detainees’ resolve.

Stress positions were prohibited at Guantanamo under DOD policy beginning in January 2003. However, these FBI agents’ observations confirm that prolonged shortshackling continued at Guantanamo for at least a year after the revised DOD policy took effect.

Such degrading tactics would appear to contravene the Geneva Convention, which bars abusive or demeaning treatment of captives.

Yet even after the programs governing interrogations were exposed, Rumsfeld made sure that a loophole in a new Defense Department policy issued in November 2005, which barred torture and called for the “humane” treatment of detainees, gave him and his deputy the authority to override it.

“Intelligence interrogations will be conducted in accordance with applicable law, this directive and implementing plans, policies, orders, directives, and doctrine developed by DoD components and approved by USD (I), unless otherwise authorized, in writing, by the secretary of defense or deputy secretary of defense,” the policy says. “USD (I)” refers to the undersecretary of defense for intelligence.

************* Jason Leopold launched a new online investigative news magazine, The Public Record, www.pubrecord.org.