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America and The Arab World

'Arab Street' Polls Suggest America May be Gaining Traction While Iran Loses Ground

July 13th 2009

Arab Topics - Arab Street USA Friendly

Several new polls suggest that the United States is gaining ground in the Arab street, and that President Barack Obama's latest overtures, specifically his June 4 speech in Cairo, were well received by some important Arab constituencies. Although a great deal of skepticism remains, students of Arab public opinion would regard these numbers as surprisingly encouraging. In contrast, Iranian president Mahmoud Ahmadinejad's popularity has slipped dramatically in the Arab world, with many saying that the outcome of Iran's recent presidential election will hurt the region. Approximately half of the Arabs questioned even agree that "if Iran does not accept new restrictions and more international oversight of its nuclear program, the Arabs should support stronger sanctions against Iran around the end of this year."

Polling Difficulty in the Middle East

If the Middle East were more like the United States or Europe, an overnight phone poll would provide immediate answers to important questions. The reality is that phone polls in the region are notoriously unreliable and that most individual polls, however elaborate or well intended, are inevitably suspect of government interference, social bias, or other distortions. Still, if evidence from several different pollsters can be gathered, evaluated, and compared, some reasonable and even significant judgments can be rendered. This is precisely the case today when comparatively solid (and in great measure previously unpublished) data of this kind are at hand for three key Arab societies: Egyptians, Jordanians, and Palestinians in the West Bank and Gaza.

The data in question derive from three different sources, all using in-person rather than phone or online interviews: the Washington-based Zogby International, the Ramallah-based Palestinian AWRAD Institute, and the Princeton-based Pechter Middle East Polls. This last is a new entrant on the scene, but one whose fieldwork is conducted by a very experienced, professional, and completely apolitical regional commercial survey firm—and unlike most other polls in the region, without any government sponsorship or supervision. Read more ..


Iran's Voter Revolt

Responding to the Iran Crisis: A Dilemma of Competing Priorities

July 6th 2009

Iran - Iran Election

The questionable outcome of Iran's June 12 presidential election and the regime's harsh suppression of the ensuing popular protests have sparked a global outcry, and would appear to offer a golden opportunity to rally international pressure on Tehran. The international community's response, however, has so far offered little in concrete terms, being diverse -- ranging from U.S. president Barack Obama's caution, to German chancellor Angela Merkel's tough criticism, to Russian and Chinese leaders' embrace of the announced results -- and seemingly uncoordinated. To mount a more tangible response to the Iran crisis, the United States and its allies will have to weigh their options against varying international policy priorities.

The election crisis in Iran is not dissimilar to past events elsewhere around the world. Devising an effective international response, however, is more difficult than in other cases because of the tension between two competing international priorities. First is the U.S. and EU desire to stay out of the way of any internal transformation in Iran. To this end, these countries have avoided inserting themselves into what appears to be a growing challenge to the legitimacy of the autocratic regime of Ayatollah Ali Khamenei. The second priority is to demonstrate to Tehran that flagrant disregard of international opinion incurs a cost, a lesson with clear implications for nuclear diplomacy with Iran. Read more ..


Iran's Voter Revolt

Saudi Media Take the Lead Against Iran's Regime

June 29th 2009

Iran - Iran Election Protest

Most commentary on the regional reaction to Iran's postelection strife divides Arabs into pro-Iranian and pro-American camps, a simplistic division that misses a key distinction. At the official or semiofficial level, Arab reaction to Iran's current travail is divided into three, not two, main parts: the usual handful of pro-Iranian-government actors (Syria, Hizballah, and Qatar); the surprisingly strident anti-Iranian-government stance from Saudi Arabia; and the large camp of cautious bystanders, including major actors like Egypt, which harbors a serious grudge against Tehran.

Equally noteworthy is that caution, rather than reflexive support for either Iran or the street demonstrators, is also the watchword among major Arab opposition movements, particularly the Muslim Brotherhood and its Hamas offshoot. So far, at the popular level, the dominant feature appears to be -- at least from the outside -- a lack of great activity or even interest, rather than the gathering storm of popular mobilization that some commentators expected.

Saudi-Led Media Charge against Tehran

Apart from Iran's friends in Damascus and Doha, Arab governments have generally avoided direct comment on Iran's internal affairs. The kings, emirs, presidents, and their official representatives have mostly kept silent, endorsing neither Iran's official version of the election nor the popular protests against it. But an analysis of the state-controlled or state-influenced media in these countries, which are much more vocal, is revealing. Read more ..


Muslim World Elections

Morocco Proves a Muslim Nation's Elections Can be Free and Fair

June 22nd 2009

Arab Topics - Morocco election

It is 131 degrees Fahrenheit in Marrakesh, Morocco, yet a slow but steady stream of voters--many of whom are women--enter the schoolyard to cast their ballots at the polling stations for the municipal elections.

On June 12, 2009, 1,503 communities chose their representatives in orderly, transparent elections, according to Ahmed Herzenni, chairman of Morocco's human rights watchdog, CCDH. His opinion was shared by more than 150 foreign observers, including the International Strategic Studies Association from Washington, D.C., and the New York-based American Center for Democracy (ACD).

Unlike the Soviet-style election in April that led to the reelection of President Abdelaziz Bouteflika in Algeria, Morocco's eastern neighbor, or the controversial and violent presidential election in Iran, Morocco's election was "fair and free." Read more ..


Muslim World Elections

Cedars Revolution Defeats Hezbollah in Election as "March 14" is Put to the Test

June 15th 2009

Lebanon Topics - Lebanon Election 2009

According to the latest polls, the so-called "March 14" coalition, which was formed in the wake of the Cedars Revolution and the Syrian withdrawal in 2005, has obtained a majority in the Lebanese Parliament, defeating the Hezbollah political and financial machine. This victory, in a very challenging local, regional and international context, is a benchmark with multiple lessons to learn. The following is a first evaluation of the results, although they will most likely be challenged by Hezbollah and their allies.

Under Threat Since 2005

Even though it was seen by the international community as the last straw, the assassination of Rafiq Hariri and his companions wasn’t the final tragedy Lebanon had to experience in 2005. The March 14 majority in parliament and the country’s executive branch were targeted for assassination, intimidation and destabilization by the Syrian-Iranian "axis." As of July of that year, politicians, journalists, MPs and simple citizens were murdered, wounded and kidnapped by the terror networks operating inside the country even after the withdrawal of Assad’s troops. Deputies Jebran Tueni, Walid Eido, Antoine Ghanem, and Pierre Gemayel--who was also a minister in the cabinet--were killed by car bombs and hit teams.

Read more ..

The Obama Edge

After the Applause, Fifteen Hard Questions to Ask About Obama's Cairo Speech

June 8th 2009

Obama Admin Topics - Arab Street Obama Cairo

Perhaps the most challenging task for analysts and commentators to accomplish after having listen to President Obama's speech in Cairo (addressed to the "Muslim World") is to know how to read it, understand the links between the points he made, capture the arguments inserted by his speech writers and thus analyze the text as a major policy change since 9/11.

Readers must establish a "map of the speech" before venturing to its various exotic suggestions and hints. Evidently, each political constituency in America, the region and the international community has its priorities and will jump to the part it deems most pressing, either exciting or depressing. However, jusy look at the very idea of addressing the "Muslim world" or as the President coined it often in his speech, "the Muslims" (two different things), and understand where Obama is coming from and going to. To help in this analytical task -- and to simplify what seems to be complex -- the public must raise the following questions and address them separately in the debate before re-sowing them as a one bloc of ideas. Here are the 15 top questions to ask.

1. Is the equation of mending relations between a nation state, America, and a whole civilization, Islam, rational? Is it academically sound to put one country and fifty two other countries in one framework of relationships? Are all 52 Muslim countries in one basket and America in another? Who framed this equation? Read more ..


Edge of the Environment

Globalization Continues Destruction of the Amazon Rainforest

June 1st 2009

Environment Topics - Amazon rainforest
Amazon Rainforest

Ever since its opening to the double edged sword known as "development," debates over the Amazon rainforest repeatedly have degraded into an international tragi-comedy of hypocrisy and shirked responsibilities. Development’s fate, in reality, has been shaped by two contradictory trends: on the one hand, shrill opposition to ecological destruction from large swathes of the developed conservation-minded world, and on the other, runaway deforestation. This duality has intensified in recent years, with ever greater awareness of the importance of the rainforest failing to hold the line against the prevention of the acceleration of its destruction.

The precarious state of the Amazon rainforest was starkly highlighted by data released in early 2008, which showed a rapid increase in Brazil´s deforestation rate in the second half of 2007. This alarming fact was caused primarily by high demand for such products as beef, soya, and timber, as well as the impact of various developments which had the effect of pushing small landholders deeper into the forest. Read more ..


America and Israel

The Obama-Netanyahu Meeting: The Ripples Are Just Beginning

May 25th 2009

Israel Topics - Obama and Nettanyahu

This week's White House meeting between President Barack Obama and Israeli prime minister Binyamin Netanyahu was both uneventful and momentous -- and because of this, its ramifications are likely to ripple throughout U.S. and Middle East politics far into the future.

Unmet Expectations of Conflict

The party most upset by the outcome of the Oval Office tete-a-tete was surely the press corps—both U.S. and Israeli—which had seemed eager to see these two savvy, confident politicians locking horns. In fact, both Obama and Netanyahu were effusively warm toward each other in public, with the former extolling their "extraordinarily productive" 105-minute private discussion and the latter calling his host a "great" leader no fewer than four times (and this, just over 100 days into his presidency!)

Indeed, each leader dismissed, with brief remarks, disputes that existed largely in the imaginations of newspaper columnists and bloggers. By committing himself to "simultaneous and parallel" pursuit of Arab-Israeli peacemaking and efforts to prevent Iran's acquisition of a nuclear weapons capability, Netanyahu resolved a thorny chicken-and-egg dispute over which comes first.

Read more ..

Caribbean on the Edge

Haiti--A Nearby Collapsed Economy in Need of Help

May 18th 2009

Caribbean - Dirt Biscuits in Haiti
Dirt Bicuits in Haiti

In April, delegates from 28 countries gathered in Washington for the International Donors’ Conference on Haiti and agreed to pledge $324 million in additional aid to Port-au-Prince over the next two years. At the meeting, which was hosted by the Inter-American Development Bank (IDB), contributors promised $15 million in emergency food assistance, $20 million to improve infrastructure, and $2 million to help fight drug trafficking through the U.S.-backed Merida Initiative. Additionally, the recovery plan will target creating an estimated 150,000 desperately needed jobs in the country—a stimulus scenario that would considerably reduce the country’s dependence on foreign assistance in the years ahead.

Former President Bill Clinton appealed to the donor forum’s participants to alleviate the plight of the stricken nation. “Haiti has a chance. Haiti has good leaders. Haiti has a good plan,” he insisted. Read more ..


The Obama Edge

AIPAC Confronts New Obama Reality

May 11th 2009

Obama Admin Topics - Obama AIPAC

“You’re not going to like my saying this,” Vice President Joe Biden told 6,000 delegates from the podium of the American Israel Public Affairs Committee’s annual policy conference — a spot that politicians usually vie over vigorously for the privilege of telling the crowd what they want to hear.

But Biden, after sending up his rhetorical warning, used his May 5 keynote speech to the pro-Israel lobby to convey the Obama administration’s insistence on a number of policies directly conflicting with those of the new government in Israel — and some policies held by previous Israeli governments, too.

Other speakers, such as Democratic Senator John Kerry of Massachusetts, chairman of the Senate Foreign Relations Committee, underlined Biden’s points on the need for Israel to stop expanding settlements in the West Bank and accept the necessity of a two-state solution to resolve the Israeli-Palestinian conflict. Read more ..


Pakistan on the Edge

As Pakistan Teeters on the Brink, American Security Policy Shudders

May 11th 2009

Islamic Topics - Taliban in Pakistan

Both the establishment of sharia (Islamic law) in Pakistan's Swat valley and last month's advance by Taliban militants to within sixty miles of the capital, Islamabad, have raised concerns about increased terrorist threats to the United States as well as the security of Pakistan's nuclear weapons.

It appears that Pakistan, whose president, Asif Ali Zardari, has just met with President Barack Obama in Washington, is becoming the first major foreign policy challenge for the new administration. Intense discussions have already taken place in the White House. Early thinking on the issue suggests that events in Pakistan also affect many aspects of U.S. Middle East policy.

Counterterrorism

The size of the safe havens available to terrorists along the Afghan-Pakistani border has evidently expanded beyond the Federally Administered Tribal Areas (FATA), the region adjacent to Afghanistan where tribal rather than national law applies. Although Pakistan has launched air and artillery strikes to force the retreat of Taliban fighters, FATA and the surrounding region are likely to remain outside full government control. Read more ..


Latin America on the Edge

Chávez and Morales Force Sweeping Land Reform Measures

May 5th 2009

Latin American Topics - Chavez and Morales
Hugo Chávez and Evo Morales

Latin America’s battalion of left-leaning leaders has been in full voice as they turn to achieve the land reform goals of the Bolivarian Revolution. This oft-quoted but somewhat vague social ideal is loosely centered on populist measures such as the equitable distribution of private land and the abatement of poverty. The tenets of this revolution are best seen today at work in Venezuela and Bolivia, where Hugo Chávez and Evo Morales attempt to achieve their objectives through vigorously promoted land reform initiatives.

Historically, much of the land parcels in these Andean nations has been under the tight control of a relatively select few multinational corporations, as well as elite European-descended land-holding families. Many of the latter were for decades, often sanctioned by corrupt officials to use coercion or other unscrupulous practices, including counterfeit land titles, to wrest land with murky legitimacy from the indigenous population. Today, leaders like Chávez and Morales are striving to rectify history’s injustices by returning the property back to its original owners. These grassroots initiatives on the part of the indigenous have been controversial, to say the least, and have repeatedly brought both nations to the brink of class warfare.

Repercussions of the January 25th Referendum

Since the enactment of the January 25, 2009 constitutional referendum, in which 61 percent of Bolivians voted in favor of ratifying, President Evo Morales has initiated a series of measures aimed at improving the rights of the 4 million indigenous peoples who make up nearly two-thirds of his country’s total population.

Read more ..

The Pakistan and Afghanistan Crisis

If Taliban Take Over Afghanistan and Pakistan--India is Next

April 27th 2009

Terrorism - Taliban

As the U.S. administration and its allies are devising a new strategy for the next steps in Afghanistan, the Jihadists have already begun their next move. But this time, it's inside Pakistan. Afghanistan, Pakistan and India are as one regional battlefield where the other side is coordinating strategically, acting methodically, and beating the international coalition in pure agility and speed. 

 

If Washington and its allies fail to see the big picture in the fight against the Taliban and Al Qaeda, which unfortunately may be the case now, the rapidly deteriorating situation will soon spread from the northwestern provinces of Pakistan to spill over to both Afghanistan and India, if not beyond. That is how I suggest "reading" the recent worrisome leaps achieved by the Taliban from the SWAT valley into the neighboring district of Buner. So, what's the story and why should we consider it as a crossing of the red lines?  Read more ..


Surge Against Hamas

Misdirected Fire: The UNHRC Report on Gaza

April 20th 2009

Gaza Topics - Gaza bomb damage
Gaza War Damage

In March, the UN Human Rights Council's (UNHRC) special rapporteur for the Palestinian territories, Richard Falk, published a report on Operation Cast Lead that makes far-reaching allegations against Israel and the potential illegality of its actions in Gaza. These assertions, however, rather than having a factual or legal basis, are essentially political in nature. Now that the United States is to be a member of the council, it should ensure that future reports are more balanced and credible.

During the Bush administration, the United States decided not to serve as a member of the UNHRC, fearing that its presence would give credibility to the flawed international body. In recent days, the Obama administration reversed this policy, announcing it would join the council. Read more ..


Edge of Human Rights

U.N. Human Rights Council Whitewash Argues Against U.S. Participation

April 13th 2009

UN Topics - Human Rights Council Meeting

Since the presidential election in November, human rights organizations and nations that support the U.N. Human Rights Council (HRC) have anticipated that the United States would seek a seat on the council. On March 31, their hopes were realized when U.S. Secretary of State Hillary Rodham Clinton and U.S. Permanent Representative to the U.N. Ambassador Susan Rice announced that the U.S. would seek a seat on the Human Rights Council in the upcoming May election to "make it a more effective body to promote and protect human rights." This decision is a mistake. The HRC is a seriously flawed organization that, absent fundamental changes, will not be improved by U.S. participation.

The first three years of the Human Rights Council have been bitterly disappointing, with the council continuing the worst practices of the U.N. Commission on Human Rights (CHR), including stigmatizing Israel and overlooking serious human rights violations by China, Cuba, and other states. These practices led the U.N. General Assembly to replace the CHR with the HRC in 2006. When the HRC also proved lacking, the Bush Administration declined to seek a seat on the council and distanced the U.S. from its deliberations.

Read more ..

Iran's Nukes

Arab States Worried Over Iranian Hegemony and Nuclear Ambitions

April 6th 2009

Iran - Ahmadinejad at Iranian nuclear plant
Iran's Revolutionary Guard

Arab states have joined with most of the world in condemning the Iranian drive to produce a nuclear weapon. They understand that a nuclear-armed Iran would be a grave threat to their security. Even now, Iran is threatening its neighbors and provoking outrage in the Arab world.

In recent weeks, Iran's Arab neighbors have accused it of threatening the sovereignty and independence of the Kingdom of Bahrain and territories of the United Arab Emirates, "issuing provocative statements against Arab states," and interfering in the affairs of the Palestinians, Iraq and Morocco. Read more ..


Edge of Islamic Extremism

Hezbollah and Narco-Islamism

March 30th 2009

Social Topics - Narcotics

Earlier this month, the United Kingdom announced that it is reopening dialogue with the political wing of Hezbollah. Unlike the United States, the United Kingdom has only banned Hezbollah's terrorist (External Security Organization) and military wings.

The ban on the terrorist wing came in 2000, while the ban on the military wing only came in June 2008 in response to Hezbollah's "providing active support to militants in Iraq who are responsible for attacks both on coalition forces and on Iraqi civilians, including providing training in the use of deadly roadside bombs," for plots to kidnap British security workers in Iraq, and for its support for terrorist activity in the Palestinian Territories.

Meanwhile, the European Union has not yet designated any part of Hezbollah -- military, political or otherwise -- although it did label Imad Mughniyeh, the late Hezbollah chief of external operations, and several other Hezbollah members involved in specific acts of terrorism. Read more ..


Edge on Environment

America Needs a Bailout from GM's Cancerous Legacy to the Environment

March 23rd 2009

Energy / Environment - Toxic Waste barrels

Near Flint, Michigan, which was once a hub of failing industrial giant General Motors, are perhaps the remains of decades of toxic waste left behind as a legacy to generations to come.
 
Auto plants are not the healthiest of places to work.

Factory work poses various health risks. Over the years, auto workers have had to deal with the health hazards associated with paint and welding fumes, the production and plating of die cast parts, foundry work, woodworking, asbestos insulation on deteriorating overhead pipes, cutting fluids and many other potentially serious health dangers where identifiable toxic chemicals were present and suspect. Many times, grave health issues that might come from workplace exposure have not surfaced until workers were older and retired. Read more ..


America's Economic Collapse

The End of Retailing As We Knew It

March 9th 2009

Economy - Out of Business

Over the last 30 years Americans have learned to love soft living and fallen for the lie of prosperity at any price. In the last 10 years a significant number of delusional citizens have tested the get rich quick theory of life, twice. First, the internet bubble lured millions to believe that Pets.com was going to change the world and day trading was a road to riches. Once this bubble collapsed and wiped out millions of investors, we moved onto the next bubble.

Millions of Americans bought into the “fact” that home prices only go up. The National Association of Realtors dealt the propaganda that now was the best time to buy. Alan Greenspan provided the fuel with 1 percent interest rates and recommending ARMs for everyone.

Banks and mortgage brokers provided the mortgage products that would allow someone with annual income of $25,000 to “buy” a $400,000 home. The get rich quick portion of our population (10 percent to 20 percent) began to buy multiple houses and flipping them before the ink was dry on the closing papers. Home prices doubled in many places in the space of a few years. This lured a vast amount of the population to borrow against the ever increasing value of their homes. Everyone knew that home prices never fall. Read more ..


Inside Palestine

The Palestinian Pandora's Box

March 9th 2009

Israel Topics - Arab Child in Jerusalem

The mild reaction by Arab countries to the Hamas-driven Palestinian predicament in Gaza refutes the assumption that the Palestinian issue is a top Arab priority and that it constitutes the core cause of Arab hostility toward the West, USA and Israel. In fact, the Arab reaction has reflected overall Arab attitude toward the Palestinian issue since 1948, through the 1982 Israel-PLO war in Lebanon and the First and Second Intifada, irrespective of the identity of the Palestinian leadership: Haj Amin al-Husseini, Shukeiri, Hammuda, Arafat, Abu Mazen or Haniyeh.

Arab countries have always showered Palestinians with rhetoric, but they have refrained from significant support. During the 2009 Gaza War, Arab countries rejected the call for an emergency session of Arab leaders on behalf of Gaza. They have limited their meek support to a gathering of Arab foreign ministers, calling for a UN emergency session. Saudi Arabia dismissed the suggestion to employ oil as a weapon. Riyadh prohibits pro-Palestinian rallies and its religious establishment issued a weak proclamation on behalf of the Palestinian struggle. The Gulf Cooperation Council focused on economic and monetary issues during its December 30, 2008 meeting, according lips service to Gaza.

A similar reaction occurred during the 1982 Israel-PLO war in Lebanon, which erupted on June 4. The Arab oil producing countries convened in August to discuss the price of oil, dismissing the proposal to use the oil weapon on behalf of the PLO. The summit of Arab leaders was deliberately delayed until September, following the expulsion of the PLO from Beirut. Read more ..


Iran's Nukes

Iran's Strategic Nuclear Deception

March 3rd 2009

Iran - Iran Nuclear Equipment
Iranian nuclear equipment

Iran’s satellite launch in February 2009 should have been a wake-up call. Instead, the West has reached over and hit the snooze button. Americans and Europeans are under the impression that the program’s main goal is the destruction of Israel. Iranian nuclear designs go much further.

The Iranian regime could possess a nuclear weapon by the end of next year. It has demonstrated that its Safir 2 rocket, which was used as the launch vehicle, is able to deliver a warhead to southern Europe and beyond.

The New York Times recently reported: “The Iranian rocket had two stages, Mr. [Charles] Vick said. If it were carrying a small warhead, he said, the Iranian missile could fire the weapon about 2,500 kilometers, or slightly more than 1,550 miles. The rocket could send a weapon to targets in Israel, but experts said that Iran had already possessed that capability. That falls short of the range of an intercontinental ballistic missile, Mr. Vick said. For Iran to achieve that technical step, he added, it would have to develop a more powerful basic rocket or more upper stages — two goals that weapons experts think it is pursuing.” The newspaper article added, “Dr. [Charles] Ferguson of the Council on Foreign Relations said that Iran’s technical advance, if translated into a military missile, might put a warhead within range of southern Europe, including Turkey, Greece, and Italy. Read more ..


America and Israel

Israel-American Pressure Does Not Work in Either Direction

February 23rd 2009

Presidential - Barack Obama AIPAC

In October 1998, on the eve of the Wye Plantation Summit, Democratic leaders of the House of Representatives told Secretary of State, Madelyn Albright: "Should President Clinton decide to pressure Israel, he would face a Democratic-Republican opposition." In September 1982, Prime Minister Begin rejected the Reagan Plan – which called for an Israeli withdrawal from Judea and Samaria – by throwing the official envelope at the lap of the US Ambassador, declaring: "Israel is not a Banana Republic." In spite of – and probably due to – the blunt rejection, the Reagan-era enhanced U.S.-Israel strategic relations in an unprecedented manner.

The assumption that an Israeli Prime Minister cannot face U.S. presidential pressure is as unfounded as the assumption that a US-Israel disagreement over the Arab-Israeli conflict should necessarily undermine vital Israeli interests. Read more ..


Inside Asia

Defending Thai Democracy

February 16th 2009

Asia Topics - Thai Coup

In recent months, one of America's two treaty allies in Southeast Asia turned the page on a period of intense political instability. And it did so democratically. Americans should take a moment to acknowledge Thailand as a member in good standing of the democratic club that is America's system of alliances in East Asia and the Pacific.

Reminders of an Undemocratic, Unstable Past

The most recent chapter of Thai political history began a little more than two years ago. On September 19, 2006, the military staged a coup to unseat and essentially exile Thailand's elected prime minister, Thaksin Shinawatra. Despite 14 years of uninterrupted democratic governance, global perceptions of a Thailand beset with chronic political instability quickly returned.
The unelected military-backed government exacerbated negative perceptions by mangling the Thai economy. And where the new government was widely expected to outperform the previous administration--dealing with the southern Islamist insurgency--it failed. Read more ..


America’s Economic Collapse

Stimulus Package Not Expected to Boost Grim Job Decline

February 9th 2009

Economy - Unemployment

The recently released January jobs report by the Department of Labor report reveals that last month employment opportunities declined by 598,000 and the unemployment rate increased to 7.6 percent. These numbers represent the highest amount of jobs lost since December 1974 and the highest unemployment rate since the 1992 recession's peak of 7.8 percent. The outlook for improvement is grim. President Barack Obama's stimulus package does not appear to offer any relief.

The January report shows that job losses continue to be widespread and deep. While the health care industry (+54,000) and government (+6,000) added jobs, every other sector continued to shed jobs, with manufacturing (-207,000) and construction (-111,000) being hit the hardest. Read more ..


America’s Economic Collapse

Disappearing Newspapers: The Latest Economic Casualty

February 2nd 2009

Social Trends - Newspapers

The next American commercial sector collapse is well underway, and indeed has been forestalling economic disaster for years. It is a bedrock of American democracy, enshrined in constitutional protection, and vital to an informed nation. Newspapers are next.

Start at the top. The New York Times is in trouble. When on January 20 Mexican multi-millionaire Carlos Slim Helu rode into Manhattan with a $250 million loan to The New York Times (that is, in addition to the 6.9 percent stake he lassoed in last year), the storied newspaper’s financiers breathed a sigh of relief—for the time being. But the Times’s building is still being mortgaged. "The Gray Lady" was likely to default on approximately $400 million in debt in May of this year, this woe added to $1 billion in other debt. That looming default could have forced what many consider one of America’s most prestigious newspapers to shut its doors, Michael Hirschorn recently wrote in the Atlantic.

A year ago the closure of an institution such as The New York Times would have been considered unthinkable. But the precarious structure of the massive Times’ debt has now exposed the inner workings of not only that publication, but also many others. Many readers were probably unaware of such dynamics in their daily newspaper. Now such facts are being openly discussed. Read more ..


Latin Affairs

Argentine President Kirchner Missteps in an International Tango

January 26th 2009

Latin American Topics - Cristina Kirchner and Fidel Castro

President Barack Obama came to his administration announcing that the world has changed, but President Cristina Fernández de Kirchner of Argentina has not apparently noticed. The day that President Obama was inaugurated in Washington D.C., Kirchner was making an official visit to Cuba where she met with President Raúl Castro and his brother Fidel Castro – dictator ex officio. The meeting of the leader of the Cuban Revolution was heralded by the Argentine government as a great achievement, even though for the rest of the world it was an irrelevant event that served to isolate Argentina even more on the world scene.

Cristina Kirchner went on to Venezuela, where she was received with great pomp and circumstance by President Hugo Chávez. The two national leaders re-established there a strategic relationship that had been strained by financial dealings on the part of Chavez in mid-2008. 

Confidence in Argentina’s financial policies was buffeted when in August 2008, Argentine issued more than $1 billion to the Venezuelan government at the usurious rate of 15 percent. The Chávez administration immediately resold the bonds to  Venezuelan banks and investors who then dumped the paper on the international market at discounted rates. 

But all that is now in the past. So as to dispel any lingering misgivings in the bilateral relationship, Chávez gave a guarantee to Kirchner that his country would soon compensate the Italo-Argentine industrial group, Techint, for assets that his government nationalized earlier in 2008 that belonged to Argentine multi-national Techint. Read more ..


The Surge Against Hamas

What is the Cost of Israel's Victory in the Gaza?

January 19th 2009

Islamic Topics - Hamas protester

Trying to hide a smile and a sense of self-satisfaction Prime Minister Ehud Olmert faced the cameras at the Defense Ministry and declared to the Israeli public, "We won." The Israel Defense Forces objectives for its operation in the Gaza Strip were "obtained in full." Hamas was "surprised and badly beaten," the government "made decisions responsibly and wisely," the IDF's performance was excellent and the southern home front "displayed resilience."  

Olmert would have loved to have been able to say the same thing back in 2006, at the end of the Second Lebanon War. But then he had to confront a disappointed and outraged public calling for an inquiry into the government's handling of the war. The Gaza operation was undoubtedly intended to redeem Olmert, and will be used as a springboard for a comeback - if he avoids conviction on any of the charges pending against him. 

Israel's military achievement in the fighting was aided by prior preparation and the creation of national and international legitimacy for the operation. The success was further assisted by the weakness of Hamas, in comparison to Hezbollah in the Second Lebanon War, and the IDF's willingness to sustain losses that in the end were less than expected. Read more ..


Sunset for the Oil Age

Conflicts, Geopolitics and Economics--a Perfect Storm To Usher Out the Age of Oil

January 5th 2009

Energy / Environment - Oil Barrels

Conflicts and geopolitics will militate against increasing oil production in the coming years.

The 2007 National Petroleum Council report, "Facing the Hard Truths about Energy," recognizes the danger and states that in order to attract the trillions of dollars necessary for the expansion of the energy infrastruc­ture, a "stable and attractive investment climate" will be necessary. Clearly, this is a serious problem when considering the conditions in Iraq, Iran, Venezuela, Sudan, Burma, and Nigeria. As the competition for oil increases, political risks in key production areas are likely to rise over the next 15 to 20 years. Read more ..


Edge on Terror

Are Terrorist Weapons of Mass Destruction More Likely Over the Next Five years?

December 29th 2008

Terrorism - Suitcase nuke

An intelligence assessment by the Internal Homeland Security Threat Assessment for the years 2008-2013, obtained by the Associated Press, projected several dramatic developments. Among these projections was that terrorism directed against the U.S. will continue to be driven by instability in the Middle East and Africa. The report asserted that WMD attacks could be carried out against America, but that these threats are also the most unlikely because it is so difficult for al-Qaida and similar groups to acquire the materials needed to carry out such plots. The report reasserts a number of predictions made before and noted that increasing numbers of individuals will pose as refugees or asylum seekers.

While the report doesn't add much to previously projected assessments over the past few years, it deserves a thorough evaluation by the counterterrorism community as well as the experts studying the strategies and tactics of Jihadists.

This latest report contradicts the conclusion of numerous other reports regarding the likelihood of a WMD attack. For example, while many national security reports have pointed out the inevitability of a non-conventional attack, other reports (and sometimes the same assessment) found the terrorists’ ability to obtain these weapons as less likely. A global review of the "War on Terror" should be conducted as soon as possible on a national scale, involving the U.S. Congress, former and forthcoming U.S. officials, and private sector analysts.

Read more ..

The Global Economic Crisis

Sovereign Wealth Funds And Protectionism

December 22nd 2008

Economy - International Currency 3

In October 2008, the International Working Group of Sovereign Wealth Funds (IWG) released a set of generally accepted principles and practices (GAPP) for the conduct, governance, and accountability of sovereign wealth funds (SWF).

First conceived in the 1950s by foreign governments as a means to invest surplus foreign exchange earnings in the U.S. and markets abroad, SWFs have been the subject of intense media and government scrutiny after a flurry of investment deals in 2006 and 2007 caught the public's eye. Because many SWFs lack transparency, critics have been concerned that these government-owned investment vehicles could be used to advance political, as well as economic, agendas.

Some observers fear that rather than using SWFs as a means to hold a diversified asset portfolio and earn a solid return on investment, countries might use these funds to destabilize financial markets, protect industries and companies, or even expropriate technology. With little public information available on most sovereign investors' financial objectives, countries—including the U.S.—began to question the value of SWF benefits and whether action should be taken against what may instead represent a threat to their economic and national security. Read more ..


Edge on Economic Crisis

Another Great Depression Is Closer Than We Think

December 15th 2008

Economy - Depression-era woman
Depression-era WPA photo

The United States is in the midst of the worst financial crisis since the Great Depression. The question is: How close are we to another Great Depression?

The answer is: Very close. 

Here’s why.

The Great Depression was the result of the combination of the1929 financial crisis and serious structural problems in the American economy such as widespread poverty. After the 1929 stock market collapse these factors joined to deeply cut business investment and personal consumption. The consequence was a downward depressionary spiral that created the worst economic collapse in American history.

Today’s economy is hurtling downward on a similar path to depression. The mortgage and financial crises have constricted credit and largely cut off business investment. Stagnant wages and over-borrowing have curtailed consumer spending.

The collapse of a stock market bubble in 1929 triggered a chain of events that led to depression. In the late 1920s, investors and financial institutions poured money into stock. Banks, assisted by the Federal Reserve’s low interest rates, lent money on easy terms to investors. Rapidly rising stock prices created a get-rich euphoria that attracted more dollars. Both investors and financiers assumed that stock prices would continue to rise and continued to over-borrow and over-spend on stocks. Read more ..


Health Edge

Employer-Based Health Insurance: Why Congress Should Cap Tax Benefits Consistently

December 8th 2008

Social Topics - Medical bag

Too many Americans do not fully understand how the health insurance they receive through their employer is financed. Health insurance is, of course, a "fringe" benefit. Formal premium payments to health insurance companies are made by employers, just as employers pay for other fringe benefits, such as paid vacation, child care, education and training, or retirement plans.

Technically, however, the employer is not "giving" the employee anything: The employees pay for these benefits through a reduction in their wages or an employer's reduction of full-time staff. The number of part-time jobs is increased to accommodate workload without offering any additional fringe benefits. As professors Katherine Baicker and Amitabh Chandra of Harvard University note:

Employees ultimately pay for the health insurance they get through their employer, no matter who writes the check to the insurance company. The view that we can get employers to shoulder the cost of providing health insurance stems from the misconception that employers pay for benefits out of a reservoir of profits. Regardless of a firm's profits, valued benefits are paid for primarily out of workers' wages. Workers may not even be aware of how much their total health premium is; however, employers make hiring and salary decisions based on the total cost of employment, including both wages and benefits such as health insurance, maternity leave, disability insurance, and retirement benefits. They provide health insurance not out of a generosity of spirit, but as a way to attract workers—just like wages. When the cost of benefits rises, wages fall (or rise more slowly than they would have otherwise), leaving workers to bear the cost of their benefits in the form of lower wages. Read more ..


America's Economic Collapse

Bailout Report Card--A Failing Grade and a Frightening Outlook for 2009

December 1st 2008

Economy - No Bull

The United States government has been in non-stop bailout mode for the last three months. How has it done? How has the nation’s economy been impacted if at all? Here’s a report card.

Troubled Asset Relief Program

The Troubled Asset Relief Program or TARP has distributed $179 billion to the largest financial institutions in the United States. The first $125 billion was forced on the nine largest financial institutions by Henry Paulson on October 28. Since that forced feeding, 21 other financial institutions have applied for and received an additional $54 billion from the $700 billion trough. Now every shaky company in America is trying to figure out how to get a piece of the action. American Express and GMAC are converting to “banks” so they can get bailed out by taxpayers for loaning money to people who couldn’t repay them.

By any reasonable assessment, the Troubled Asset Relief Program has been a miserable failure and a complete waste of taxpayer money. The basis used to ram the bill through Congress was the purchase of the toxic assets off of bank’s books. Not one dollar has been used for this purpose. The main purpose for passing the $700 billion bailout was to restore confidence in the markets.

On October 3 when the TARP was signed into law, the S&P 500 was at 1,114. Today, it is 887. The 20 percent decline in the markets in six weeks doesn’t show much confidence in Paulson’s acts. Paulson changing course every few days has shown the world that he is “winging it.” He has floundered from buying toxic assets to jamming capital down the throats of banks to his current plan to support consumer debt. Did Paulson lie to Congress about buying toxic assets? Read more ..


Inside Palestine

Arabs Unable to Influence Israeli Policies in Jerusalem Because They Will Not Vote

November 24th 2008

Israel Topics - Arab Vendor

On November 11, 2008, Nir Barkat was elected mayor of Jerusalem. Not participating in the mayoral election, once again, was Jerusalem's Arab population. As permanent residents of the city, Jerusalem's Arabs are entitled to vote in municipal elections, although the overwhelming majority of the Arab population boycott these elections.

Since 1967, various Palestinian Authority associations (now run both by Fatah and Hamas) have demanded that the Jerusalem Arabs refrain from voting in these elections. According to these groups, any voting in Israeli government elections on the part of the Arabs will signify their approval of the Israeli "occupation" of what they claim is Palestinian territory. East Jerusalem, of course, is one of these highly contested areas. Read more ..


America’s Economic Collapse

Could General Electric Collapse?

November 17th 2008

Corporate Logos - General Electric

General Electric, the legendary American institution, founded in 1878 by Thomas Edison, is in deep trouble. Its PR machine has been in constant spin mode as the company sinks deeper into fiscal despair. GE is one of the few major companies in the U.S. that still retains an AAA rating. Considering Moody’s and S&P’s track record rating companies and financial instruments, not a few observers feel that an AAA rating is not worth the paper it is written on.

One look at GE’s balance sheet will convince an inquirer that the firm indeed does not deserve an AAA rating. AAA companies do not need to take the desperate actions that GE has taken in the last few months. Something is seriously wrong at GE.

The stock reached $53 at its peak in 2000 and has virtually crashed to below $17 this past week, the lowest level since the mid-1990s. CEO Jeffrey Immelt, who took over from icon Jack Welch in 2001, has made his mark by managing the company to a 68 percent decline in its stock price. No one at CNBC seems willing to take a hard look at GE’s financial statements or ask the CEO tough questions, because Mr. Immelt signs their paychecks. While shareholders have taken a bath, Mr. Immelt, a Harvard MBA, raked in $72.2 million of compensation between 2002 and 2007. A company that is known for its "pay for performance" mantra evidently does not hold its CEO to the same standards.

Read more ..

Edge on the Election

The Ghosts of the Past Haunted--and Inspired--this Election

November 10th 2008

Politics - Voting

When this campaign began so many months and $4.3 billion ago, many pollsters and pundits predicted that Election Day would be the final round of the battle of the New York titans, pitting Hillary Rodham Clinton against Rudy Giuliani. Back then, when we thought about waking up at 3 AM, we usually associated it with an unwelcome run to the john, not the test – as described in Hillary Clinton’s campaign commercial – of who was ready to lead the nation.

If we imagined a ceiling with 17 million cracks in it, we assumed it would shatter, especially if the ceiling was glass; when we worried about meltdowns, it was because our kids were overprogrammed or undersupervised, not because our financial markets were overstretched and under-scrutinized; and when we talked about Joe the plumber we grumbled about the guy who charged too much and came too slowly not some idealized version of the people’s wisdom incarnate.

In those days when we thought about the largest state in the union, we wondered what its connection was with baked Alaska, we did not think about the half-baked ideas of the governor from Alaska and the conventional wisdom in Washington described Joe Biden as a blow-dried, blowhard politician, (who barely won 11,000 votes when he ran in the 2008 primaries) rather than the ultimate democratic ideal, a working class kid from Scranton conjured into Beltway foreign policy guru. The most famous Barak in the world was Ehud, the Israeli Defense minister, and –dare I say it -- the most famous Hussein was either Saddam or the late King of Jordan. Moreover, most Americans agreed that the most decent, nonpartisan, moderate member of the United States senate was… John McCain. Read more ..


America's Economic Collapse

Wachovia Shows Why No Bank's Books Should be Trusted

November 3rd 2008

Corporate Logos - Wachovia Logo

Often when people have near-death experiences, they resolve to change their ways. That's not the case with the folks running Wachovia Corp., which experienced the financial equivalent.

In their starry-eyed world, Wachovia's net assets still were worth $50 billion as of Sept. 30, according to the balance sheet the Charlotte, North Carolina-based bank released last week. Never mind that on Oct. 2 Wachovia's board approved Wells Fargo & Co.'s offer to buy the company for $14.8 billion in stock, saving it from the clutches of Citigroup Inc. and the undertakers at the Federal Deposit Insurance Corp.

Taken literally, the timeline suggests two scenarios. Either Wells Fargo is getting about $35 billion of stuff for free. Or the value of Wachovia's equity plunged $35 billion during the first two days of October. Neither of those happened, of course.

The reality is that Wachovia's management, including Chief Executive Officer Robert Steel, still won't admit the company's balance sheet is a farce and has been for a long time. More worrisome though is that nobody with any authority is calling them on it, even today. That includes Wachovia's auditor, KPMG LLP, as well as the Securities and Exchange Commission, and banking regulators such as the Federal Reserve and FDIC.   Read more ..


Election Edge

Should Anyone Care About Barack Obama's Past Associations?

October 27th 2008

Presidential - Barack Obama

Past is prologue, or so we often say.

But the consensus among the intelligentsia seems to be that this aphorism does not apply to Barack Obama—at least not when names like William Ayers and Jeremiah Wright come up. Should it?

Let’s be clear that many esteemed politicians at one point or another in their careers have unlovely associations. Harry S. Truman was a loyal henchman of Kansas City’s Pendergast machine in its heyday and never renounced it. Boss Tom’s creative voting manipulations (which ACORN would envy) launched Truman into the U.S. Senate. (Of course, in those days the other side was also creative.) Franklin D. Roosevelt made peace with New York City’s Tammany Hall. As Governor of New York, needing its support for his 1932 presidential run, he desperately tried to avoid prosecution of its multiple corrupt practices.

Roosevelt and Truman almost surely would not have established relationships with Ayers and Wright. Does that say something about Obama, or about ourselves in the present day?

Rev. Wright is a bitter and polemical black nationalist, who demonstrated in his National Press Club appearance that his “God damn America” line had not been taken out of context. I doubt that Barack Obama bought into his worldview. I suspect that an aspiring young politician looking for a church to affiliate with saw Wright’s large and influential black Chicago congregation as ideal place for networking. Read more ..


Edge on Terrorism

France's War with Jihadism--More Than Most Know

October 20th 2008

Islamic Topics - French Muslim protesters
French Islamic Protestors

France's war with the jihadis is more intense than most Americans or even most Europeans would imagine.

With French troops engaging the Taliban in Afghanistan often coming under attack, jihadist cells have started targeting France as well as French presence in the Sahel, the north African Sahara. Now active jihadist cells are indeed deploying inside France just as they are inside many other Western European countries.

In a recent interview with Parisian daily Le Figaro, French Interior Minister Michèle Alliot-Marie, provided significant revelations about France’s vulnerabilities and response. Added to information provided by other French defense and counterterrorism officials and legislators, the picture undeniably affirms that France now joins Britain and other western European countries as pivotal points in the scheme of international jihad. Read more ..


America's Economic Collapse

Peering Inside the Bailout Bill

October 13th 2008

Economy - Secretary Paulson
Treasury Secretary Henry Paulson

During the early negotiations, a number of particularly bad policy options were added to the original Treasury proposal -- the final agreement appears to drop all of them

Administration and congressional negotiators reached agreement early September 28 on a package of actions to address the alarming financial situation facing the U.S. economy. Although several drafts of legislative language have been circulating, it is not yet possible to provide an overall assessment until the agreement’s final language is examined carefully.

The devil is always in the details, and so it is wise to look at the details. But several concerns and questions arose with earlier versions of a proposed package during week of September 21-27. So far, it appears that the negotiated agreement addresses these concerns in the following ways:

The agreement creates a new Office of Financial Stability within Treasury that is empowered both to purchase troubled assets from financial institutions and other bodies and to use other methods to address the current financial situation. This office would be immediately empowered to purchase up to $250 billion worth of troubled assets at any one time. If necessary, the Secretary of the Treasury could increase that amount by an additional $100 billion after notifying Congress that this additional sum is necessary. Read more ..



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