Friday, May 30, 2008

Updating Yassin Aref's Struggle for Justice

Updating Yassin Aref's Struggle for Justice - by Stephen Lendman

Yassin Aref is an Iraqi Kurd and political prisoner in Police State America. A full account of his ordeal can be found at the following link:

In the post-9/11 climate of fear, Aref was targeted for his faith and ethnicity and victimized by a willful FBI frame. It began as a sting to entrap him. Charges against him were baseless. No evidence supports them. Yet he was falsely arrested, accused, indicted, tried and convicted in October 2006. It was on 10 of 30 fraudulent counts in a kangaroo court proceeding. They included money laundering, conspiracy to provide material support for a terrorist plot, terrorism, and making false statements in February 2002 and August 2004.

Aref was then sentenced in March 2007 and is now serving 15 years hard time at Terre Haute, Indiana's secret federal prison Communications Management Unit (CMU). It's for "high-security risk" Muslim and Middle Eastern prisoners and was established to limit or cut them off entirely from outside contact. The unit violates federal law as well as Prison Bureau regulations. They stipulate that "staff shall not discriminate against inmates on the basis of race, religion, national origin, sex, disability, or political belief (including) administrative decisions (involving) access to work, housing and programs." The Federal Administrative Procedures Act requires that all prison regulations comply with this law.

In addition, the Supreme Court ruled in Johnson v. California (May 3, 2004) that segregating prisoners by race, ethnicity or language is illegal. Bush administration officials disdain the law and ignore whatever High or other court rulings go against them. There aren't many. Congress is complicit. It makes no effort to stop them, so nothing deters them from mocking the rule of law and erasing the last remnants of democracy in America. The result is victims like Aref and many others like him.

Here's a brief account of his ordeal and how events unfolded in his case:

-- he's from Iraqi Kurdistan;

-- he came to America in 1999, worked as a hospital janitor, ambulance driver and later became the Masjid As Salam Mosque's imam;

-- the FBI targeted him and his friend, Mohammed Mosharref Hossain (a Bangladesh immigrant); it was in a 2003 sting that became a frame; it involved Aref's courtesy for Hossain - agreeing to witness his loan transaction according to Muslim custom; it was at a time he spoke poor English, believed the transaction was legitimate, was unaware of any law violations, let alone a scheme to frame him;

-- he was arrested in August 2004 and convicted in October 2006; charges against him were baseless and were from illegally obtained NSA warrantless wiretaps;

-- he's now at Terre Haute's CMU, a victim of police state justice, separated from his wife and small children, and hoping for an appeals court verdict in his favor.

On March 24, 2008, Aref's appeal was held before the Second Circuit Court of Appeals in New York. His status now awaits the outcome from a court that may be sympathetic. In an all too familiar post-9/11 pattern, they're hearing other cases like his. It's hoped that may arouse their judicial outrage over such extreme injustice to a growing number of Bush administration victims.

Aref's Trial Lawyer's Assessment of the Appeals Court Hearing

Here's an account of the proceedings from one of his pro bono trial lawyers, Stephen Downs. He attended the hearing and recounted what happened. Forty-seven supporters were there from Aref's home city of Albany. They filled a bus, traveled to Manhattan, split evenly between Muslims and other faiths, and were all united for Aref.

Downs begins by explaining that predicting the appeals outcome is uncertain at best and perhaps foolish at worst. Separate attorneys represented Aref and Hossain and each used "very different legal arguments."

Kevin Luibrand argued for Hossain on illegal entrapment. In addition, he claimed that "since the transaction was always presented as a loan, there was no attempt to conceal the source of the money, and hence no crime of Money Laundering occurred...." If the court agrees with either claim, Hossain's charges may be dismissed. Further, if it accepts the Money Laundering argument, some or all of Aref's counts may also be dropped.

Downs strikes a hopeful note that: "The Court seemed most interested in these two strong sharply focused arguments, and (assistant US attorney William Pericak) seemed to have the most difficulty with them."

Terry Kindlon argued for Aref. He mainly claimed that insufficient evidence was presented at trial to justify his conviction. In addition, there were numerous erroneous "evidence" claims to the jury.

Downs is less upbeat about this strategy. While the argument may be strong, it's hard to present orally "because it is impossible in just (the few minutes alloted) to go through all of the evidence" to show adequate proof. As a result, the Court seemed disinclined to spend a lot of time on this, even though one justice "seemed to have a very detailed understanding of the evidence (and) seemed to understand what the defense was saying." But he didn't indicate either way if he agreed or disagreed.

In Down's opinion, however, the lack of time spent doesn't indicate how the court will rule. It chose instead to review all evidence in briefs rather than discuss them in detail in open court.

The remainder of Aref's case involved procedural errors. If they're accepted, it would result in a new trial but not dismissal of charges against him.

Cory Stoughton of the New York Civil Liberties Union also argued briefly for Aref and Hossain. He focused on how the trial judge handled classified material but withheld it from the defense. He also addressed the illegal NSA wiretapping issue. Downs again thinks this tact is "awkward" because the DOJ kept information secret so defense has no idea what it is or if it's relevant. Even so, the short amount of time on this matter is no indication of its importance to the Court.

In a separate March 21 pre-hearing press release, the ACLU commented on the case. Executive Director Donna Lieberman said: "The courts must not be complicit in President Bush's campaign of secrecy. NSA spying is unconstitutional, and secret opinions only aid the government's effort to keep the illegal campaign hidden away from public scrutiny and outrage."

Before the March 24 hearing, Cory Stoughton added: "Secret court opinions are antithetical to the American system of justice. Especially when there are allegations of unlawful government surveillance and abuse of executive power at play, the public has a right to understand the government's arguments and the courts' justifications for their decisions." The ACLU firmly supports the public's First Amendment right to understand what happens in the judicial process and abhors the government's use of secret information.

Finally, Downs above noted how hard it is predicting the appeal's outcome, but he tries anyway and is upbeat. He felt "listening to oral argument that the defense, the Court and the prosecution were all quietly agreeing that Hossain was simply the patsy here." He (and Aref) were part of an FBI sting cum frame, "but nobody ever believed that he (or Aref were) a danger to anyone."

It means there's a good chance the Court will rule favorably on the entrapment defense. The justices spent a lot of time on this argument. The DOJ had a lot of trouble explaining its side, and Downs thinks attorney Pericak did a poor job of it. His conclusion leaves this writer breathless and likely Aref and Hossain supporters as well: "The facts are there," in Downs judgment, "to support a dismissal and so is the legal theory, and so is the sense that this man (and Aref are) not dangerous." The Court may agree and either dismiss Hossain's charges or grant him a new trial.

As for Aref, Downs thinks the outcome is harder to predict based on his lawyer's oral argument. Questions posed centered on evidentiary issues and a detailed knowledge of the record. The Court seemed to be looking for procedural errors that would justify a new trial as the "best way to clear the air."

Down's also believes the Court's view of Aref's character is important. If it thinks the DOJ unfairly targeted him as a "jihadist, at least he may get a new trial. His lawyer stressed the "character" issue so it may be key to the outcome.

On the issue of so-called "classified evidence," Downs has no idea how the Court will view it or if it will affect the decision. Without knowing what it is, it's impossible to gauge its importance, or, in the current climate, how the Court will react.

The New York Times on Aref's Appeal

On March 25, the NYT wrote about the previous day's hearing in an article titled "Convicted Imam Seeks Evidence of Wiretapping." The article's tone was racist by emphasizing the term "imam" to highlight Aref's Islamic faith. In addition, it stressed use of NSA wiretaps, ignored the more important defense arguments, and also left out the most pertinent facts about Aref's case. Nonetheless, Times writer Alan Feuer included some key ones:

-- that Aref was "convicted of supporting terrorism in an FBI sting operation;" (no mention was made of a willful frame);

-- that he may have been "spied on improperly by the National Security Agency;" (in fact, he was);

-- that if the Court agrees, his conviction may be "reverse(d);"

-- that the FBI's "sting" involved a "fictitious plot involving shoulder-launched missiles (to be used for) the assassination of a Pakistani diplomat in New York;" (the idea on its face is preposterous, and the Court may see it that way);

-- that secret DOJ evidence was withheld from defense lawyers with security clearances to see it; (it casts doubt on its relevance, authenticity or even existence);

-- that the New York Civil Liberties Union testified on behalf of the defense for both men; and The Times concluded by saying:

"As it now stands, the case may be the best chance to obtain an appellate ruling on the (NSA's wiretapping) program (that persists) without court approval." Aref's case (and Hossain's draw) "directly on the substantial constitutional protections afforded to criminal defendants."

The Times continued that last year a Cincinnati federal appeals court "dismissed a case challenging the agency's program, saying that the plaintiffs did not have standing to sue." However, in November, "a federal district judge in Virginia told the government that if it did not allow lawyers for an Islamic scholar sentenced to life in prison for inciting followers to commit acts of terrorism to review classified material on possible wiretapping, she might order a new trial."

A Personal Note

I first learned about Aref last March, wrote about him on March 13, and was encouraged that many web editors picked up the article. I also wrote to Aref, and he responded with a considerable delay because of the difficulty communicating with a federal prisoner, especially one called a "terrorist."

Aref's letter was glorious. He wanted me to have his book, and I now do. It's a poignant memoir/autobiography titled "Son of Mountains: My Life as a Kurd and a Terror Suspect." It was written at Troy, New York's Rensselaer County Jail after his wrongful October 2006 conviction and before his transfer to Terre Haute's CMU. It's a courageous man's story, and imagine his achievement. He wrote it in jail, barely spoke English when he arrived, has now improved it measurably, but he's still learning.

I don't think he'll mind if I share some of his comments. He began hoping I'm fine, in good health, and then said: "Thank you very much for all you (did) and what you are doing to bring peace and justice for this nation and all over.

I read your article about my case (and) wanted to send you a letter and say thank you....I am glad you have (my) book, this means I will going to hear from you what you think of it, and I will be happy to receive many notes and advices from you....feel free to 'critisice' any part of any thing in the book."

Aref's book is glorious. It deserves praise and admiration, not criticism, and it's strongly recommended to readers. It's also easily available through Amazon, the site has three 5-star reviews on it, it's going into second printing after a limited first run, and book proceeds are for Aref's four young children through his Children's Fund.

Aref wrote much more, enclosed portions of his other writings, and he ended his letter saying: "You honored me by writing to me. I am sorry this is my best in writing English. Take care my 'brother.' Peace, salam. Yassin"

Yassin is now my "brother," a political prisoner and victim of injustice. Yet, his spirit seems high, he dreams of reunion with his family, and he continues to write. A recent article was on April 19. He called it "Bread for the Baker and Meat for the Butcher (Nan Bo Nanawa Goshtish Bo Qasab)." It's five paragraphs long and says (from the Kurdish experience) "there is no possibility (in Iraq) for development, and we won't see any stability til they let our bakers bake bread and our butchers prepare meat. If this doesn't happen, we will see more corruption and our lives will become more and more miserable. Especially when:

Fools are ruling
The blind are leading
The ignorant are teaching
The racists are preaching"

....and a brutal occupation continues its ugly oppression. At his article's end, Aref cites two proverbs and asks that they be understood to "have a better sense of (one's) self-respect and recognition of (one's) own capacity." He wishes this for "many of our leaders and politicians (and) will be glad to see many of them honoring themselves by resigning from office." Millions around the world share that view and then some. Many also know about Yassin and how a brutish regime mistreated him.

Stephen Lendman is a Research Associate of the Centre for Research on Globalization. He lives in Chicago and can be reached at

Also visit his blog site at and listen to The Global Research News Hour on Mondays from 11AM to 1PM US Central time for cutting-edge discussions with distinguished guests. Programs are also archived for easy listening.

Thursday, May 29, 2008

Disturbing 2008 Global Peace Index Report

Disturbing 2008 Global Peace Index Report - by Stephen Lendman

The Global Peace Index (GPI) was launched in May 2007 and claims to be the first study of its kind ranking nations according to their peacefulness. Last year's report covered 121 countries. The latest increased it to 140. Australian entrepreneur Steve Killelea conceived the idea and won some dubious endorsements. Among them, the Dalai Lama.

He served as a CIA asset from the late 1950s until 1974 and may again be in tow if the Bush administration's awarding him a Congressional Gold Medal last year and closeness to him now is an indication. Other endorsers include Jordan's Queen Noor; another member of her royal family; four members of the British House of Lords; Ted Turner; Virgin Group's Richard Branson; other business and community leaders; Australia's former Prime Minister JM Fraser; other former high-ranking government officials; academics; a former BBC war correspondent and MP; plus six Nobel Laureates, including Jimmy Carter. In fairness, a few distinguished names join them, including Helen Caldicott and economics professor James Galbraith.

These organizations prepare GPI's report - The Economist Intelligence Unit, an international panel of peace experts from peace institutes and think tanks, and the University of Sydney's Centre for Peace and Conflict Studies. Their stated purpose is to "highlight the relationship between Global Peace and Sustainability (stressing that) unless we can achieve" a peaceful world, humanity's major challenges won't be solved. No argument there, but does GPI's statement belie its real interest?

GPI uses 24 indicators to rank nations according to their relative internal and external peacefulness. They include their:

-- military expenditures as a percent of GDP and number of armed service personnel per 100,000 population;

-- relations with other countries;

-- respect for human rights;

-- potential for terrorist acts;

-- number of homicides per 100,000 population, including infanticide;

-- level of violent crime;

-- aggregate number of heavy weapons per 100,000 population and ease of access to small arms and light weapons;

-- number of jailed population per 100,000 population; and

-- number of internal security officers and police per 100,000 population.

Conspicuously absent is a measure of outside influence causing internal violence, instability and/or disruption. Venezuela ranked an implausible 123rd behind America at 97th. Something is amiss, and the above rating raises suspicions that angered Venezuelan National Assemblyman Jose Albornos. He stated:

"Sometimes things tip over into irrationality just like they're doing just now....(it's) part of a plan....there are sectors who decide that they want to get rid of Chavez, who have seen that they cannot (do it by) coup d'etat and are trying to penalize the whole country in a campaign of attrition."

He then added that the 2008 GPI "doesn't correspond with the truth," and plenty of evidence backs him. It's examined below.

By GPI's criteria, scoring Venezuela high and America lowest should be no-brainers. The US hands down is the world's most violent nation and primary reason for Iraq, Afghanistan and Israel's bottom rankings. The same holds for Lebanon, Somalia, Sudan, Colombia, Pakistan, Sri Lanka, Uganda, the Philippines and a host of other nations.

By comparison, Venezuela is placid and tranquil but GPI's criteria don't show it. It certainly ranks above Rwanda, Albania, the Dominican Republic, Mexico, Bangladesh, El Salvador, Guatemala, Honduras, Turkmenistan, Ethiopia, Azerbaijan, Uzbekistan, Egypt, China, Jordan, and other countries outscoring it. Why not is the question? Think politics for an answer in spite of America's low ranking and Israel near the bottom. It's not low enough. It should be last hands down.

The US alone endangers global stability, world peace and the planet's survival. It alone wages permanent war, targets peaceful nations, and claims a unilateral right to use first strike nuclear weapons preemptively. It also has over 800 military bases (perhaps 1000 or more with secret ones) in 130 or more countries, hundreds more at home, and still more troops deployed in other countries throughout the world. It further spends more on its military than all other nations combined. It uses it aggressively, supports Israeli repression against Palestinians, assassinates foreign leaders, installs more "friendly" ones, and backs despots like Colombia's Uribe, Egypt's Mubarak, the Saudi royal family, Mexico's Calderon, and various installed stooges like Afghanistan's Karzai and Iraq's al-Maliki.

America ranks lowest on peace. It keeps sinking lower. It alone threatens planetary survival. Failure to register that in a "peace index" is unimaginable. It makes the entire project suspect.

Under Chavez in contrast, Venezuela's record is envious. It embraces its neighbors, offers no-strings aid, and engages in mutually beneficial trade, political relations, and other alliances; it also:

-- assassinates no other leaders;

-- doesn't seek regime changes abroad;

-- has no nuclear weapons and seeks none; and

-- spends less than one-half of one percent of the Pentagon's (grossly understated) military budget (around $1 to $2 billion) and less half of that, in fact, of America's total defense spending - in FY 2008: a conservatively estimated $1.1 trillion with all military, homeland security, veterans, NASA, debt service and miscellaneous related allocations included; according to Chalmers Johnson, it's not only "morally obscene," it's "fiscally unsustainable" and is heading the nation for probable "insolvency and (the world for) a long depression," or potentially worse.

-- In addition, Venezuela doesn't export weapons to neighbors or incite conflict; in contrast, America is the world's leading arms and munitions supplier by far - and to many belligerent states with disturbing records of using them internally and/or against neighbors; Colombia, Mexico, Pakistan, Ethiopia and Israel to cite five;

-- Chavez is socially responsible at home;

-- doesn't practice torture;

-- has no secret prisons;

-- threatens no other nation;

-- wages no wars;

-- is a model democracy;

-- governs peacefully;

-- supports human rights and social justice;

-- affirms free speech;

-- bans discrimination; and

-- uses his resources responsibly - for his people, yet is friendly to business as well. He's earned world class stature and immense popularity at home as a result. Under George Bush in contrast, America is feared and hated worldwide. Growing numbers don't trust him at home either, and it shows in his poll ratings - some of the lowest ever for a US president with vice-president Cheney and Congress scraping rock bottom.

A stunning (but long known) fact came out as well. It's in a US Justice Department Inspector General's 370 page report. It revealed that the FBI opened a "War Crimes" file documenting witnessed systemic Guantanamo Bay torture. It's so inflammatory that the administration suppressed it. It asserts that orders came from the top, including the White House, Pentagon, DOJ and NSC. It implies but doesn't state that this practice goes on in all US military prisons plus ones outsourced to in rogue states for some of the most barbaric treatment anywhere - and mostly to innocent victims.

Some GPI-Reported Comparisons - America v. Venezuela

Prisons everywhere are harsh, and Venezuela's are no exception. But consider America. It has the largest prison population in the world by far at 2.3 million, greater than in China with four times the population. It also adds over a 1000 new prisoners a week. It's justifiably called a gulag, so imagine what goes on offshore. No remediating efforts are planned. Reforms are off the table. America's prison-industrial complex is burgeoning. Prisons are being privatized. Profiting on human beings is big business, and consider who they are. Most are black, hispanic, poor, unempowered, nonviolent, and imprisoned for offenses like drugs possession.

In contrast, Venezuela is humanizing its prisons. It's no simple task, and no miracle cures are expected. Nonetheless, positive steps are being taken for a prison population numbering 20,000 that's down from its 1992 31,400 high. The National Assembly is "committed to giv(ing) priority to (revising) the Penal Code and the Criminal Procedure Code." It's to make it more just and improve prison conditions in health care, food, access to education and more. Reducing incarceration lengths is also planned as well as tackling root causes of crime such as poverty and lack of opportunity. Doing this in America is impossible. Things keep worsening. The nation is uncaring. It shows across the board. That highlights the problem, but GPI didn't notice.

Number of homicides per 100,000 population is another category. GPI ranks America low (in number) and Venezuela high. It's unjustified. From it's beginning, America has been violent at home and abroad. It's been at war with one or more adversaries every year in its history without exception. It's called a "gun" and "rape culture" and has the highest homicide rate among all western nations. Violence is endemic, pacifism sinful, legal and illegal drug use out of control, young children introduced to violence through films, television and video games that should be outlawed. They're exported everywhere to make all societies like America. Venezuela is no exception but nowhere near to matching the US.

Implausibly, America also scores well on the following:

-- its number of internal security officers and police; it refers to "civil police" only; omitted are National Guard forces, Coast Guard, Homeland Security, FBI, CIA,16 spy agencies, drug enforcement, and since October 2002 the US Northern Command (NORTHCOM) that preempts Posse Comitatus limitations that no longer apply; no nation on earth has more internal (or external) security, spends more for it, and no country uses it more aggressively;

-- ease of access to "weapons of minor destruction;" Venezuela ranks below America; impossible as guns in the US are as accessible as chewing gum even in cities where they're banned; the Second Amendment (on right to bear arms) practically equates it with religion even though the law's original intent bears no relation to its current interpretation that's promoted by the gun lobby;

-- "likelihood of violent demonstrations;" Venezuela scores high; unconsidered is why any take place and who's behind them - America, not Venezuelans except for those recruited and well-paid to cause trouble to destabilize an otherwise peaceful country;

-- violent crime; Venezuela scores high again and America low; wrong as violence in the US is endemic; GPI understates it;

-- political instability; Venezuela scores moderately high; again no mention why there's any or who instigates it;

-- human rights; America and Venezuela get equal scores; preposterous again and insulting to Venezuelans; America's disdain for human rights is unmatched; Venezuela's is excellent by comparison; the Constitution mandates it; GPI ignores it;

-- political democracy; America outranking Venezuela is impossible; the US's democracy is illusory; in Venezuela it's real and should be highest rated relative to other countries;

-- the electoral process; America besting Venezuela is false and insulting; Venezuela has a model participatory democracy; all Venezuelans are enfranchised; the Constitution's Article 56 mandates it; it affirms that "All persons have the right to be registered free of charge....after birth, and to obtain public documents" so stating;

-- US elections, in contrast, are deeply corrupted; big money runs them; candidates are pre-selected; machines do our voting; no recounts are possible; losers are declared winners; independent candidates are shut out; the media ignore them; they keep people uninformed; issues aren't addressed; just "horserace" theater ad nauseam; voter disenfranchisement is rife; election theft common; mountains of evidence document it; none reported in the mainstream; it's why half or more of the electorate opts out; it mocks democracy in a nation having little; it's exemplary in Venezuela; not according to GPI;

-- "functioning of government" defined to mean freely electing representatives and effective checks and balances; the US wins again completely belying the facts; America's democratic governance is a sham; Venezuela's is real; GPI has things backwards;

-- civil liberties; America on top here, too; it's outrageous in a growing police state climate; post-9/11 repressive laws, executive and military orders, directives and other measures are in force that would make any despot proud; presidential authority is unchallenged; Congress is mere rubber-stamp; Homeland Security is a national Gestapo; FBI and CIA also; internal spying is pervasive; dissent stifled; human rights disdained; and the rule of law is now consigned to the dustbin of history; Venezuelan society is mirror opposite; GPI failed to notice;

-- "corruption perceptions;" America scores high and Venezuela low, and indeed there is a problem; yet it's minor compared to the US's all-pervasive kind - in government, business and throughout high levels in society; it involves trillions of dollars; again it didn't register;

-- Reporters Without Borders (RWB) is the source for GPI's comparative "freedom of the press" assessment; RWB no longer publishes an index with assigned country rankings; instead it rates them: No. 1 good, No. 2 satisfactory, No. 3 noticeable problems, No. 4 difficult situation, and No. 5 very noticeable problems;

-- RSW's reputation is tainted; it lacks credibility; it disgraced itself last year by baselessly criticizing Chavez's justifiable decision not to renew RCTV's VHF license and accusing him of violating free speech and press standards; not surprisingly, it showed in its 2007 survey with rankings still used; it rated America somewhat low at 48th but Venezuela far lower at 114th - below Chad, Morocco, Uganda, Indonesia, Albania, Congo, Liberia, Kuwait, the Central African Republic and numerous other questionable higher-ranked choices; in 2008, Venezuela jumped considerably; GPI scored it 36.9 (an apparent 37th in the world); the US fared much better at 14.5; tops were Iceland and Norway at 0.8;

-- GPI and RSW should be embarrassed; consider the facts; no country outranks Venezuela in press freedom; outlandish dissent is tolerated; censorship banned, and the law affirms it; RCTV lost its VHF license for backing insurrection against the government; its officials avoided prison for their lawlessness; they were merely slapped on the wrist instead;

-- America is mirror opposite; RCTV type broadcasting would be illegal, an act of sedition or treason; those responsible would be prosecuted; but it's not how major media operate in the US; they "filter" news; one-sidedly support a state and corporate agenda; shut out opposition to it; keep the electorate uninformed by operating no differently than a state-controlled ministry of information and propaganda; RSW approves; so does GPI;

Its data is suspect throughout. Adult literacy (unrelated to violence) is another example. It scores America at 99%. It's laughable. Even the US Department of Education estimates it at 80% tops, and their number way overstates it. It's far lower based on inner-city math and English test scores plus painfully low computer literacy levels.

Other Questionable Rankings

GPI isn't alone in targeting Venezuela. Transparency International (TI) does as well. It calls itself "politically non-partisan" and a "global civil society organisation leading the fight against corruption (with a) create change toward a world free of corruption." Consider its 2007 "Corruption Perceptions Index." To achieve its aim, it better tighten its standards that fall far short of "transparency."

America easily outscores other nations in corruption. It's broad, deep and extends throughout government, business, and high levels of society in the trillions of dollars. But it's not how TI sees it. It ranks the US No. 20, just behind France and ahead of Chile. In contrast, Venezuela scrapes bottom at 162nd - behind Turkmenistan, Tajikistan, Sierra Leone, Liberia, Kazakhstan, Congo, Pakistan and dozens of other dubious choices. Venezuela (like all countries) has corruption problems. But nowhere to the degree TI suggests. Its April 2008 report is rife with errors and why not. According to Calvin Tucker in a May 22 article, it was prepared by "an anti-Chavez activist who backed the 2002 military coup against democracy." His full account can be accessed by the following link:
The Fraser Institute is a right wing, business-backed, Canadian-based think tank. It prepares an annual Economic Freedom of the World Index that has nothing to do with freedom. It's not kind to Venezuela and sidesteps facts in its assessment. Following the country's 2002-03 oil management lockout, growth has been impressive and remains so. Business has profited hugely. All economic measures are strong and improving except for inflation. It remains stubbornly high, but efforts are being made to curb it.

Nonetheless, Fraser reports with blinders. It ranked Venezuela practically at the bottom - 126th out of 130 nations, only besting Congo, Zimbabwe and two other countries. It's the sixth consecutive bottom-scraping rating and mirror opposite those for pre-Chavez years. Since then, Venezuela prospered. Chavez is friendly to business. Fraser turns a blind eye. It's part of a corporate-led conspiracy to crush democracy and reempower capital. It raises questions on whether GPI, RWB, TI, Fraser and others are part of a larger scheme.

Iran is America's top target. Venezuela is next. Both countries are nominated for regime change. Continued efforts work toward it. It's no secret why. Each is oil rich, their leaders independent, and they refuse to be US clients. For Washington, that's sinful and unforgivable. The media are on board. They relentlessly bash both countries and report fiction as fact. Destabilization efforts continue. Anything may erupt anytime. GPI and the others may be helping.

Their low Venezuelan rankings are suspect. Washington may be behind them. Corporate backers as well. They get what they pay for. In this case, vilifying Chavez. GPI's facts are bogus. So are RWB's, TI's and Fraser's. It discredits their Venezuela v. America's rankings. Their entire reports as well. View them with caution. Understand what's likely going on. Part of a greater scheme to destabilize Venezuela and end its model democracy. Exposing them is the best way to prevent it.

Global Research Associate Stephen Lendman lives in Chicago and can be reached at

Also visit his blog site at and listen to The Global Research News Hour Mondays on Republic from 11AM to 1PM US Central time for cutting-edge discussions with distinguished guests. All programs are archived for easy listening.

Tuesday, May 27, 2008

Plan Colombia Heads for Mexico

Plan Colombia Heads for Mexico - Stephen Lendman

It's called "Plan Mexico," or more formally the "Merida Initiative," and here's the scheme. It's to do for Mexicans what Plan Colombia has done to that nation since 1999, and, in fact, much earlier. Since then, billions have gone for the following:

-- to establish a US military foothold in the country;

-- mostly to fund US weapons, chemical and other corporate profiteers; it's a long-standing practice; in fact, a 1997 Pentagon document affirms that America's military will "protect US interests and investments;" in Colombia, it's to control its valuable resources; most importantly oil and natural gas but also coal, iron ore, nickel, gold, silver, emeralds, copper and more; it's also to crush worker resistance, eliminate unions, target human rights and peasant opposition groups, and make the country a "free market" paradise inhospitable to people;

-- it funds a brutish military as well; already, over 10,000 of its soldiers have been trained at the Western Hemisphere Institute for Security Cooperation (WHINSEC) - aka the School of the Americas (SOA) at Fort Benning, Georgia; its graduates are infamous as human rights abusers, drugs traffickers, and death squad practitioners; they were well schooled in their "arts" by the nation most skilled in them;

-- it lets Colombia arm and support paramilitary death squads; they're known as the United Self-Defense Forces of Colombia (AUC); for more than a decade, they've terrorized Colombians and are responsible for most killings and massacres in support of powerful western and local business interests;

-- it funds drug eradication efforts, but only in FARC-EP and ELN areas; government-controlled ones are exempt; trafficking is big business; laundering drugs money reaps huge profits for major US and regional banks; the CIA has also been linked to the trade for decades, especially since the 1980s; after Afghanistan's invasion and occupation, opium harvests set records - mostly from areas controlled by US-allied "warlords;" the Taliban's drug eradication program was one reason it was targeted; Colombia's drug eradication is horrific; it causes ecological devastation; crop and forest destruction; lives and livelihoods lost; large areas chemically contaminated; bottom line of the program - record amounts of Colombian cocaine reach US and world markets; trafficking is more profitable than ever; so is big business thanks to paramilitary terror;

-- it's to topple the FARC-EP and ELN resistance groups; Latin American expert James Petras calls the former the "longest standing (since 1964), largest peasant-based guerrilla (resistance) movement in the world;" it's also to weaken Hugo Chavez, other regional populist leaders and groups, and destabilize their countries; and

-- it supports the "Uribe doctrine;" it's in lockstep with Washington; its policies are hard right, corporate-friendly and militarized for enforcement.

Plan Colombia turned the country into a dependable, profitable narco-state. Business is better than ever. Violence is out of control and human rights abuses are appalling.

It gets worse. Two-thirds of Columbians are impoverished. Over 2.5 million peasant and urban slum dwellers have been displaced. Thousands of trade unionists have been murdered (more than anywhere else in the world), and many more thousands of peasants, rural teachers, and peasant and indigenous leaders have as well. Paramilitary land seizures are commonplace. Colombian latifundistas profit hugely. Wealth concentration is extreme and growing. Corruption infests the government. Many thousands in desperation are leaving. Colombia's "democracy" is a sham. So is Mexico's. Plan Mexico will make it worse. That's the whole idea, and it's part of the secretive Security and Prosperity Partnership - aka the North American Union.

It's planned behind closed doors - to militarize and annex the continent. Corporate giants are in charge, mostly US ones. The idea is for an unregulated open field for profit. The Bush administration, Canada and Mexico support it. Things are moving toward implementation. Three nations will become one. National sovereignty eliminated. Worker rights as well. Opposition is building, but moves are planned to quash it. That's the militarization part.

Business intends to win this one. People are to be exploited, not helped. That's why it's kept secret. The idea is to agree on plans, inform legislatures minimally about them, get SPP passed, then implement it with as few of its disturbing details known in hopes once they are they'll be too late to reverse.

SPP is ugly, ominous and hugely people destructive. Hundreds of millions in three countries will be affected. Others in the region as well. Plan Mexico is a contribution to the scheme. Below is what we know about it.

Plan Mexico - Exploitation Writ Large

The plan was first announced in October 2007 as a "regional security cooperation initiative." It's to provide $1.4 billion in aid (over three years) for Mexico and Central America on the pretext of fighting drugs trafficking and organized crime linked to it. FY 2008 calls for $550 million for starters with about 10% of it for Central America.

In fact, Plan Mexico is part of SPP's grand scheme to militarize the continent, let corporate predators exploit it, and keep people from three countries none the wiser. Most aid will go to Mexico's military and police forces with its major portion earmarked back to US defense contractors for equipment, training and maintenance. It's how these schemes always work.

This one includes a menu of security allocations, administrative functions, and special needs like software, forensics equipment, database compilations, plus plenty more for friendly pockets to keep our Mexican cohorts on board.

After failing on May 15, House passage will likely follow the Senate's approval on May 22 - below the radar. It's one of many appropriations tucked into the latest Iraq/Afghanistan supplemental funding request, and its purpose is just as outlandish. It will militarize Mexico without deploying US troops. It will also open the country for plunder, privatize everything including state-owned oil company PEMEX, give Washington a greater foothold there, and get around the touchy military issue by allowing in Blackwater paramilitaries instead to work with Mexican security forces.

Only privatizing PEMEX is in doubt thanks to immense citizen opposition. Thousands of "brigadistas" were in the streets, protesting outside the Senate and Chamber of Deputies, as lawmakers considered ending PEMEX state-control. They paralyzed debate and brought it to a halt - temporarily putting off a final resolution of this very contentious issue. Big Oil wants it. Most Mexicans don't. The battle continues. Mexico's military may get involved.

The US State Department describes them as follows:

-- ...."impunity and corruption (in Mexico's security forces are) problems, particularly at the state and local levels. The following human rights problems were reported: unlawful killings; kidnappings; physical abuse; poor and overcrowded prison conditions; arbitrary arrests and detention; corruption, inefficiency, and lack of transparency in the judicial system; (coerced) confessions....permitted as evidence in trials; criminal intimidation of journalists leading to self-censorship; corruption at all levels of government; domestic violence against women (often with impunity); violence, including killings, against women; trafficking in persons; social and economic discrimination against indigenous people; and child labor."

Mexico's military fares little better with promises Plan Mexico will worsen it. President Calderon now deploys troops around the country. People fear them when they come. They're purportedly against drugs traffickers, but that's mostly cover. Their real purpose may be sinister - a possible dress rehearsal for martial law when SPP is implemented.

Mexican soldiers are hard line. Their reputation is unsavory. People justifiably fear them. They commit flagrant human rights abuses and get away with them. The major media even report them. The New York Times, CNN, BBC, USA Today and others cite evidence of rape, torture, killings, other human rights abuses, corruption, extortion, and ties to drugs traffickers. Little is done to stop it. Government and military spokespersons often aren't available for comment. They're part of the problem, not the solution. Plan Mexico promises more of the same and then some. Billions from Washington back it.

Social protests in the country already are criminalized. Hundreds are filling prisons. Many languish there for years. Labor and social activists are most vulnerable. Injustice and grinding poverty motivate them. Plan Mexico ups the ante. Things are about to get worse.

Militarizing society is toxic. Police state enforcement follows. Accountability disappears. The rule of law no longer applies. Plan Mexico assures it. So does SPP for the continent. In classic doublespeak, the White House claims it will "advance the productivity and competitiveness of our nations and help to protect our health, safety and environment." Its real purpose is to annex a continent, destroy its democratic remnants, lock in hard line enforcement, and secure it for capital.

SPP Backdrop of Plan Mexico

A detailed SPP explanation can be found on the 2007 article link. It's titled The Militarization and Annexation of North America -

Plan Mexico is part of SPP. It will militarize and annex the continent. It was formerly launched at a March 23, 2005 meeting in Waco, Texas attended by George Bush, Mexico's President Vincente Fox, and Canadian Prime Minister Paul Martin. They forged a tripartite partnership for greater US, Canadian and Mexican economic, political, social and security integration. Secretive working groups were formed to accomplish it - to devise non-negotiable agreements to be binding on all three nations.

Details are hidden. No public input is permitted. Pro forma legislative voting is approaching. It will try to avoid a NAFTA-type battle. Legislatures aren't being fully informed. The worst of SPP is secret. It's not a treaty, and the idea is to pass it below the radar and avoid a protracted public debate.

What's known so far is disturbing, and considerable opposition has arisen but thus far too inadequate to matter. SPP, Plan Mexico, and a final continent-wide plan amount to a corporate coup d'etat against three sovereign states and hundreds of millions of people. It's to erase national borders, merge three nations into one under US control, and remove all barriers to trade and capital flows. It's also to militarize the continent, create a fortress-North America security zone, and have in place police state laws for enforcement. Billions will fund it. All for corporate gain. Nothing for public welfare.

SPP takes NAFTA and the "war on terrorism" to the next level en route to extending it further for more corporate plunder. It's based on outlandish notions - that doing business, protecting national security, and securing "public welfare" require tough new measures in a very threatening world.

SPP bolsters US control. It enhances corporate power, quashes civil liberties, erases public welfare, and creates an open field for plunder free from regulatory restraints. It's being plotted behind closed doors. A series of summits and secret meetings continue with the latest one in New Orleans from April 22 to 24.

Three presidents attended and were met by vocal street protests. They convened a "People's Summit" and also held workshops to:

-- inform people how destructive SPP is;

-- strengthen networking and organizational ties against it;

-- maintain online information about their activities;

-- promote their efforts and build added support; and

-- affirm their determination to continue resisting a hugely repressive corporate-sponsored agenda. Opponents call it Nafta on steroids.

Business-friendly opposition also exists. Prominent is a "Coalition to Block the North American Union." The Conservative Caucus backs it. It has a "NAU War Room." It's the "headquarters of THE national campaign to expose and halt America's absorption into a 'North American Union (NAU)' with Canada and Mexico." It opposes building "a massive, continental 'NAFTA Superhighway.' "

It has congressional allies, and on January 2007 Rep. Virgil Goode and six co-sponsors introduced House Concurrent Resolution 40. It expresses "the sense of Congress that the United States should not engage in (building a NAFTA) Superhighway System or enter into a North American Union with Mexico and Canada."

The April summit reaffirmed SPP's intentions - to create a borderless North America, dissolve national sovereignty, put corporate giants in control, and assure big US ones get most of it. Militarism is part of it. It's the reason for fortress-North America under US command. The US Northern Command (NORTHCOM) was established in October 2002 to do it. It has air, land and sea responsibility for the continent regardless of Posse Comitatus limitations that no longer apply or sovereign borders easily erased.

Homeland Security (DHS) and its Immigration and Customs Enforcement (ICE) also have a large role. So does the FBI, CIA, all US spy agencies, militarized state and local police, National Guard forces, and paramilitary mercenaries like Blackwater USA. They're headed anywhere on the continent with license to operate as freely here as in Iraq and New Orleans post-Katrina. They'll be able to turn hemispheric streets into versions of Baghdad and make them unfit to live on if things come to that.

SPP maintains a web site. It's "key accomplishments" since August 2007 are updated on it as of April 22, 2008. Its details can be accessed from the following link:
It lists principles agreed to; bilateral deals struck; negotiations concluded; study assessments released; agreements on the "Free Flow of Information;" law enforcement activities; efforts related to intellectual property, border and long-haul trucking enforcement; import licensing procedures; food and product safety issues; energy (with special focus on oil); water as well; infrastructure development; emergency management; and much more. It's all laid out in deceptively understated tones to hide its continental aim - enhanced corporate exploitation with as little public knowledge as possible.

Militarization will assure it, and consider one development up North. On February 14, 2008, the US and Canada agreed to allow American troops inside Canada. Canadians were told nothing or that the agreement was reached in 2002. Neither was it discussed in Congress or the Canadian House of Commons. It's for "bilateral integration" of military command structures in areas of immigration, law enforcement, intelligence, or whatever else the Pentagon or Washington wishes. Overall, it's part of the "war on terror" and militarizing the continent to make it "safer" for business and be prepared for any civilian opposition.

Congress may soon pass SPP, but with no knowledge of its worst provisions kept secret. It's to assure enough congressional support makes it law. Nonetheless, federal, state and local opposition is building. It ranges from private activism to vocal lawmakers. In 2008, a dozen or more states passed resolutions against SPP. Around 20 others did it in 2007. Congress began debating it last year with opposition raised on various grounds - open borders, unchecked immigration, a NAFTA Superhighway System, and the idea of giving unregulated Mexican trucks free access to US roads and cities.

There's also talk of replacing three national currencies with an "Amero." Unfortunately, little is heard about trashing the Constitution or giving corporate bosses free reign. There's even less talk about a militarized continent against dissent. SPP is a "new world order." Companies are plotting to get it. People better hope they don't. Disruptive opposition might derail them. It's building but needs more resonance to matter. Time is short and slipping away. These schemers mean business. They want our future. We can't afford to lose it.

Stephen Lendman lives in Chicago and can be reached at

Also visit his blog site at and listen to The Global Research News Hour on Mondays from 11AM to 1PM US Central time for cutting-edge discussions with distinguished guests. All programs are archived for easy listening any time.

Thursday, May 22, 2008

"Immoral Hazard"

"Immoral Hazard" - by Stephen Lendman

So says Jeremy Grantham, co-founder of Boston-based investment firm Grantham, Mayo and Van Otterloo, now known as GMO. Some call him the philosopher king of Wall Street because of his highly insightful views on markets and the economy, usually with a longer-term perspective. In a profession of touts, fast-buck and scam artists, Grantham's commentaries are notably refreshing. They're detailed, scholarly, sober, clear and especially important at a time of unparalleled excesses, great economic uncertainty, voices ranging from gloom and doom to blue skies and all clear ahead, so who knows what to believe. Few people sort things out better than he, and whether right or wrong, he makes consummate sense and should be taken seriously.

He calls his latest commentary "Immoral Hazard" and takes straight aim at the perpetrators. It's not the first time, and with good reason. Bad policy yields bad results with former Fed Chairman Greenspan Exhibit A.

Grantham notes: "It's not that the former Fed boss...was incompetent that is remarkable. (It's that even now) so many people (still) don't seem to get it." Do they "just believe high-quality, self-justifying blarney?" Or do they think top jobs ipso facto "attract great talent by divine right?" Often, the most important jobs get "mediocrities" like Greenspan and the current White House occupant. Even worse, Washington is infested with them.

Grantham first learned of Greenspan in the late 1960s when he headed economic consulting firm Townsend-Greenspan & Co. Even then, his assessment was unsparing: "To be brutally honest, he was considered run of the mill by anyone I knew then or have met later who knew" of his work. Consider his "famous" January 1973 call that "it is rare that you can be as unqualifiedly bullish as you now can." It was right at the start of a punishing recession and 60% two-year market decline in real terms, second only at the time to the 1929 crash.

Never one to equivocate, Grantham cuts to the chase and draws blood: Greenspan's call "was one of the first of a long line of terrible prognostications for which he has remarkably 'not' been remembered," except by a few historians and analysts like Grantham. He seemed to pop out of nowhere to become Fed Chairman in 1987, not for his professional skills but for plenty of political ones. The Greenspan years and what's so far followed haven't been "our finest hour in the US."

A smattering of skilled leaders handled things way back compared to the "rudderless" kind under Greenspan and today. Moments (far too few) showed "vision, leadership and backbone." They then gave way to political opportunism and "easy paths taken" for short-term gains - most notably since the Reagan era. Referring to when Greenspan became Fed Chairman, Grantham continued saying we're "get(ting) ready to celebrate the 20th anniversary of the Great Moral Hazard." Asset bubbles are tolerated because of who wins and loses. If managed well, speculators and Wall Street profit hugely, bail out at tops (the old pump and dump scheme), then let the public take the pain. No problem though if they miscalculate. Fed Chairmen like Greenspan and the current maestro step in with bailouts.

It's called "moral hazard," and the term goes way back - to the 1600s. English insurance companies then used it in the late 17th century. In the modern era, it got more study in the 1960s, but at the time didn't imply fraud, immoral behavior or outsized excess. Economists used the term to describe market inefficiencies when risks are displaced. It was before what became known as the "Greenspan put," or the idea that Fed Chairmen provide insurance - to bail out investors who take imprudent risks, so take even greater ones since winning is always guaranteed. But only for high-rollers.

Moral Hazard 101 - A Brief Case Study

Take Long Term Capital Management (LTCM), for example, and its dream team management:

-- a former highly respected Salomon Brothers fixed income chief who became tainted by the firm's auction-rigging scandal; no matter, he remained highly regarded by Wall Street;

-- a former Fed Vice-Chairman; and

-- two economics Nobel laureates.

They played high-stakes poker with little regulatory oversight and used their good names to do very risky things - like putting on interest rate swaps at market rates for no initial margin; borrowing 100% of value of top-grade collateral held; using that cash to buy more securities, then using them as collateral for more borrowing. In other words, it was a scheme to theoretically leverage to infinity, LTCM practically did it, and for a while it worked.

Things began unravelling in 1998. It started in July when Salomon Smith Barney announced it was liquidating its dollar interest arbitrage positions. LTCM took a hit, then things got worse when in August Russia declared a moratorium on its rouble and domestic dollar debt. Panic ensued, it spread to other markets, risky investments fled to high quality ones, then they were sold to raise cash.

LTCM was one of many large investors affected. By September, it dropped 52% in value and needed new capital to avoid a dilemma that could impact all of Wall Street if not addressed. LTCM's balance sheet assets were leverage thirtyfold to $125 billion, then tenfold more by off-balance sheet transactions for a total valuation of around $1 trillion - or too big to fail. If they folded, a financial panic could ensue, so the situation was critical. Enter the Fed after some initial high-stakes maneuvering failed. It engineered a multi-billion dollar bailout to avoid a greater financial market collapse.

It worked, but it's no way to run an economy. Bad examples keep getting repeated and each time show up worse. That's precisely today's dilemma. The stakes are enormous. No one for sure knows to what degree, and there's even less assurance how things will play out.

Minsky on Markets

He's passed but surely smiling and saying I warned you. His economic writings were mostly ignored in the prosperous 1980s and 1990s, but current market turbulence proved him right. He constructed a "financial instability hypothesis" building on the work of John Maynard Keynes. It showed how speculative bubbles grow out of outsized greed. Finally, asset values collapse in the end-game part of a seven-stage up-then-reverse journey downward. It's a "Minsky Moment" when euphoria turns to panic, investors bail out, and meltdown ensues.

That's how markets reacted to the Greenspan-caused tech bubble. They sold off hugely, then reinflated from outsized monetary and fiscal stimulus. Last summer, they peaked, dropped sharply, stabilized in April after a lesser Minsky reversal, but there's no way to know if it's over. Grantham doesn't think so. Neither do others. More on that below.

Economist Michael Hudson Cuts Through the Clutter

Hudson is an economist and President of The Institute for the Study of Long-Term Economic Trends (ISLET). He's also a Distinguished Research Professor of Economics, a former Wall Street financial analyst, and a no-nonsense critic of the current economic environment. He notes how recent events show that "economic royalists" and "money changers" run things and have "mismanage(d) our economy into dire straights of unprecendented risk - (a combination of reckless) debt creation, euphemized as 'leveraging' and 'wealth creation.' "

Few regulatory checks remain, and anything goes "under the guise of 'saving the system.' " If money manipulators hadn't endangered it, no fix would be needed. Now with systemic trouble of undetermined proportions, trillions of dollars are being misdirected. They're going for wars and bailouts instead of helping beleaguered homeowners who were manipulated for profit, face possible foreclosure, job loss, and likely hard times ahead.

Hudson says what's going on is "an economy-wide Ponzi scheme (for) creditors to lend debtors enough money (for their) interest costs so as to keep current on their loans." The idea was for various asset prices (stocks, bonds, real estate) to be inflated enough so debtors could pledge them as collateral at higher market valuations for more loans.

It worked as long as valuations rose. When they fell, all bets were off, and here's how trouble started and spread:

-- cracks in the multi-trillion dollar US securitization markets showed up last summer; they created liquidity crises for two Bear Stearns hedge funds; they were heavily into sub-prime mortgages; Bear Stearns was a Wall Street outlier; it was much unloved on the street, notorious for taking outsized risks, and that made it very vulnerable for a run on its assets when the opportunity came; it happened in March and forced the firm to sell out for pennies on the dollar after 85 years in business;

-- the initial damage spread to a little-known German bank, IKB; it forced the European Central Bank (ECB) to provide large amounts of liquidity to stem the damage;

-- it became apparent that trouble was systemic; it could touch down anywhere and likely hardest where greatest risks were taken - in America; and

-- intervention wasn't working; panic didn't stop; reserve hoarding took hold instead; and a run on commercial paper began - the kinds international banks issued in Structured Investment Vehicles (SIVs).

The bottom began to fall out, and the problem was how to stop a growing debacle from becoming catastrophic. The solution, of course, was "immoral hazard" by bailing out transgressors, and the bigger they are, the greater the bailout amounts. Hudson calls it a "trillion-dollar bailout of bad mortgage debt" while homeowners go begging.

It began in March with heaps of hyperbole selling it. Multi-billions poured out. Money supply growth exploded. It now averages a near-monthly 18%. Deficits are mounting, and fiscal spending is just as outsized, but not much of it reaches households even with the so-called "rebate." In the meantime, real wages keep falling. Oil and food prices are skyrocketing. Real unemployment tops 12%. Consumer inflation is nearly as high, and real GDP (not the phony official number) hovers around -2%. Most other economic numbers are just as worrisome, so manipulating magic fixes them.

We're in uncharted territory, problems are huge, they're systemic and structural, and Hudson says "the Fed and Treasury officials seem to be making up new rules on a daily basis - that receive only....perfunctory" congressional oversight. Speculation is being rewarded, anything goes, and bailing out Wall Street and big banks takes top priority.

It gets worse. It costs trillions. No one knows where it will end or if it will work, and there's nothing left over for Social Security, Medicare, Medicaid, and all other essential social and national infrastructure needs.

Hudson puts it this way: "The historic road to serfdom is that of debt peonage to a financial oligarchy concentrating wealth in its own hands....The problem for that finance finds its major gains to lie not in raising living standards, but in promoting a free lunch for its customers -- while turning corporate profits, monopoly rent-seeking and real estate price gains into a flow of interest to itself, by advancing the credit to finance the purchase of these assets and privileges."

The only way out is to "scale back existing mortgages (especially ones with negative equity) to reflect the plunge in property values today." Once principal is "reduced to realistic levels," fixed rate mortgages would replace ARMs.

Financial institutions won't accept this or whatever other ways it costs them, and therein lies the problem. Blaming victims is much simpler along with bailing out culprits - when they're too big to fail. Hudson calls for some high-octane populism to change things. Unfortunately, not a hint of it is in sight, and debt levels are so high they "cannot be paid....given the nation's heavy military and trade deficits." It's hammered the dollar and "rais(ed) dollarized prices for oil and other raw materials."

It gets worse. Foreign central banks and investors keep funding our excesses, and US spending, of course, depends on them. The more they lend us, the more we need in a never-ending dependency cycle. It bankrupted Medici bankers in the Renaissance era and got Adam Smith to conclude that governments don't repay outsized debts. They either default, declare a moratorium, or repudiate them. Not fit subjects for discussion, but you can bet foreign debt holders weigh them as they debate whether to keep the daisy chain going.

It's got plenty of US investors concerned as well, and a notable one is bond guru Bill Gross. In an April commentary he wrote: In his judgment, "the private credit markets have forfeited their privileged right to operate relatively autonomously because of incompetence, excessive greed, and (at times) fraudulent activities."

In an earlier Financial Times interview he also criticized government quick fix schemes. He further blasted hedge funds as "unregulated bank(s)" and a "con" and said complicated financial instruments "exacerbated" credit problems, and over-leveraging "lead(s) to an implosion at the edges....of this new financial marketplace."

He's also very worried about declining home prices that many on Wall Street publicly pooh-pooh. He calls a 20% valuation decline "much more" of an economic shock than falling equities "because the amount of homeowner leverage is so much greater. A 20% negative adjustment not only wipes out all ownership equity for millions of Americans, it turns their homes 'upside down' - incentivizing them to let their gardens grow weeds instead of lettuce." He believes systemic crisis is possible if the decline isn't stopped. He's not alone in that judgment, but few agreeing get heard.

Consider damage already done. The current Case-Schiller Index shows home prices declining at a 32% annual rate. A year ago, it was 8%. The risk is a huge 4.6 million home inventory or nearly double the 2.6 million past 20 year average. Even more worrisome is that 2.27 million homes sit empty and that's besides all the others banks own from foreclosures. It's double the year ago number.

If these properties keep deflating and hit the dangerous 20% level Gross mentions, millions will lose their equity, consumption and credit will be hit, and banks will keep writing-off greater amounts no one wants to contemplate. Robert Shiller believes home prices may equal or exceed the 30% drop of the 1930s. That's $6 trillion in today's dollars, or $80,000 for every US homeowner. The Fed can keep injecting liquidity but only for so long, and it may not work. If bank losses are great enough, they'll need all they can get to stay afloat, but for some it may not be enough. Not a pretty picture and no way to know how bad things may get.

Placing Blame Where It's Due According to Grantham

Grantham looks back at 2007 and awarded three prizes for "odd prognostications." They're named in Greenspan's honor. First prize went to Citicorp's CEO Chuck Prince for enthusiastically taking on more credit at a time markets were over-extended and peaking. He subsequently wrote off billions of worthless assets, $17 billion in first quarter 2008 alone, risked the bank's solvency, and got himself replaced by a new CEO.

Current Fed Chairman Ben Bernanke took second prize for "incomprehensible misreading of obvious data by an apparently well-informed source." In late 2006, he said what he now regrets (or should) - that "US housing prices merely reflect a strong US economy." His cohort at Treasury, Hank Paulson, got third prize for his spring 2007 comment that subprime problems were "contained."

Not if you own one or too many of those junk assets written down to a fraction of their original value. Grantham calls the crisis the most important one since World War II. It's more global than others. Its tentacles are everywhere. Speculative greed and broad asset overpricing caused it. Loose regulatory and irresponsible Fed policies allowed it. Perpetrators point fingers elsewhere, and no one's got backbone enough to fess up to their to their own mistakes and transgressions.

Before this ends, according to Grantham, it's "likely to make the S & L crisis look contained." As a per cent of GDP, write-downs this time are on the order of two to three times greater now than then. But there's no precise way to know their full impact or to what degree monetary and fiscal stimulus will contain the damage or delay its final resolution. They won't be papered over, and writer/economist William Engdahl puts it this way:

Greenspan was a tool of the monied interests who gave him his job. He "knew who buttered his bread" and returned their favors manyfold. He engineered many crises and used them all to "advance and consolidate the influence of US-centered finance over the global economy, almost always to the severe detriment of the economy and broad general welfare of the population." His 18 year tenure was undistinguished to say the least. "It can be described as rolling the financial markets from successive crises into ever larger ones..."

It remains to be seen if his "securitization revolution was a 'bridge too far,' " spelling the beginning of the end of US dominance as an economic power. The "true significance" of today's crisis (nowhere near resolved) lies right in his lap. Engdahl lists his menu of malpractice in serving the "Money Trust," meaning Wall Street and big banks. In each case, it yielded big short-term gains, greater long-term losses, and successively greater crises. A new Fed Chairmen has to solve them. Bailout is his strategy. It may help in the short-term. The jury is still out. The policy is flawed. It assures greater crises ahead, and at some point the music stops.

Bernanke may end up being too smart by half. We're awash in problems that one analyst calls three simultaneous imploding bubbles:

-- a property, mainly housing, price one;

-- a mortgage finance one; and

-- an alphabet soup of CDOs, SIVs, SPVs, and a whole menu of levered-up, high-risk securitized assets amounting to financial alchemy.

Grantham also takes aim at them and sees lots more write-downs and defaults ahead before it ends. He cites a longer-term problem as well - "that all debt standards fell so that losses will accumulate right across the entire credit system." Even worse, it came at a time equities were overpriced, still are, and particularly higher-risk ones. Further, "profit margins are spectacularly above average" in some sectors, margins are being squeezed, and markets finally caught on that "all risk is dangerous."

Grantham's research shows that all markets eventually revert to their means and for months have been "well into a massive repricing of both risk and asset prices" to get there. Before it started last July, we reached "the lowest risk premium, by far, ever recorded." It needs lots of heaving lifting to return it to more normal levels. And, of course, it's a painful process, a drag on the economy, and will likely take years to fix. In Grantham's judgment, through 2010 "to clean house completely," and when it ends "the amount of write-downs (may likely) start with a 'T.' "

Blame it on a Fed Chairman whose name starts with "G," and Grantham has been unsparing on him before. Referring to the 1990s and tech excess, he blamed him for engineering the largest ever stock market bubble and bust in history through incompetence, timidity, dereliction of duty or a combination of all three. It didn't matter because Wall Street types made fortunes, then got plenty of early warning to exit to let small investors take the pain.

Undeterred, Greenspan was at it again in the current cycle that's now being unwound. But this time, multiple bubbles were created, with housing and mortgage ones most affecting households. Grantham (like Gross) calls them "much rarer and more dangerous than stock bubbles" because they affect so many people. Even worse, with over half of all housing wealth borrowed and "on much less credit-worthy terms," it's very much "more dangerous than normal."

It's the Fed's job to watch over:

-- mortgage quality;

-- the soundness of repackaging mortgages; and

-- off balance sheet commercial banking that should have been stopped or curtailed.

"And what did Alan Greenspan do this time? Absolutely nothing" except whine about a little excess in housing when it was already out of hand. Even then he implied not to worry because "the housing boom will soon simmer down." And Bernanke is even more feckless with comments like "The housing market merely reflects a strong US economy." Grantham portrays him as a Greenspan clone, just as incompetent, and someone having "extraordinary faith in efficiency to the point of denial." Above all, like Greenspan, he's there to serve the "Money Trust" that appointed him.

And he's done it since taking over. First, by "stimulat(ing) at all costs" and repeating the same mistakes as his predecessor. Grantham calls 2008 "the year of Santayana: we ignored history and (are) condemned to repeat it." Housing price deflation is its most notable feature. It's what affects households most, and that, in turn, reverberates through the economy. Greenspan and Bernanke paid it no heed. Each now accepts no blame, and Grantham calls it "shameful." It's far worse than that at a time people are suffering, and the current Fed Chairman gets accolades for bailing out bankers while paying only lip service to homeowners.

By creating asset bubbles, Fed policy caused their dilemma, and Grantham believes their deflating may be the greatest of all threats to financial and economic stability. It stands to reason that efforts must be made to avoid the worst possible outcome. That means curbing speculation is key. Minsky was right that short of that financial crises are inevitable and excess is always the cause.

Grantham sums it up saying: it's important or even vital "to our financial well-being that the Fed recognizes a responsibility to move against" this behavior that comes with a huge price. Greenspan's response: "I have no regrets on any of the Federal Reserve's policies that we initiated...." Grantham calls that "chutzpah that even Paul Bremer would have to admire."

Engdahl calls it a "financial tsunami." It triggered a "crisis of confidence." High-risk securities were most affected. So were sub-prime mortgages. Then the whole "edifice of securitized debt" began unravelling, triggered by its weakest link collapse. Its effect is global and "a crisis not even comparable to the 1930s Great Depression."

High-quality municipal debt got hit. Interest rates on them "rose to the highest ever relative to Treasuries." It makes financing unaffordable and caused states and local agencies to "pull out of the $330 billion floating (auction-rate) market where costs have doubled since January." New York and London bond fund managers say it's the worst they ever saw. High interest rates aggravate fiscal crises even with the Fed cutting fed funds and discount rates. Some call it pushing on a string. Time will tell if it'll work. Engdahl is dubious. He sees depression spreading. It creates "a self-reinforcing downward spiral. The process is in its early stages...."

With market turbulence somewhat quieted after a sharp April rebound after months of declines, unanswered questions remain. Is it a lull, a turnaround, or the eye of the storm before its harshest side hits? Grantham and Engdahl see trouble. Bernanke's fingers are crossed. European central bankers as well, while Americans fear losing their homes and jobs the longer the crisis goes on and deeper it gets.

Direst forecasts have it in its early innings with the worst of things ahead. Only in the fullness of time will we know, but some things are clear. None of this happened by chance. Nor should it have in the first place. A combination of financial malpractice, outright fraud, and greed are to blame. The same mistakes keep getting repeated. The costs keep going higher. Sooner or later they matter, and some day it'll be too late to fix them. Some day may be closer than smart money folks think. Stay tuned, be cautious, and ignore Fed Chairmen and politicians promising miracles. If things were sound and improving, they wouldn't have to keep reminding us.

Stephen Lendman lives in Chicago and can be reached at

Also visit his blog site at and listen to The Global Research News Hour on Mondays from 11AM to 1PM US Central time for cutting-edge discussions with distinguished guests. Programs are also archived for easy listening.

Monday, May 19, 2008

Spinning the News - The FARC-EP Files, Venezuela and Interpol

Spinning the News - The FARC-EP Files, Venezuela and Interpol - by Stephen Lendman

First some background. On March 1, the Colombian military (with US Special Forces help) illegally attacked a FARC-EP rebel camp inside Ecuador. US satellite telephone tracking located the site. Washington signed off on the mission. Over 20 people were killed, including 16 or more FARC-EP members while they slept. Key among them was Paul Reyes, the FARC-EP's second-in-command, key peace negotiator and public voice, and lead figure in the Chavez-led hostage negotiations with Colombia.

The action was a clear act of aggression and premeditated murder. It's not how the dominant media played it. Hostile verbal exchanges took place between Hugo Chavez and Ecuador's Raphael Correa on the one hand and Colombia's Alvaro Uribe and George Bush on the other. US presidential candidates, as expected, supported the White House and Bogota.

Tensions heightened further when Colombia's vice-president, Francisco Santos Calderon, revealed his nation's army recovered three laptops and other material at the FARC-EP camp with provocative evidence on their hard drives. He claimed it showed Chavez and Correa have links to the FARC-EP, and Venezuela provided weapons, munitions, and $300 million or so to the rebel group. In addition, the FARC-EP was accused of acquiring 50 kilograms (110 pounds) of uranium, that it wishes to sell it for a radioactive dirty bomb, it also sold 700 kilograms of cocaine for about $1.5 million, and more.

The story is preposterous, but the media grabbed hold of it. No evidence exists, so they invent it. In March, Colombian authorities asked Interpol to examine the computer files for authenticity. The organization released its report on May 15. On its web site, it states that Secretary General Ronald Noble "advised senior Colombian law enforcement officials that INTERPOL's team of forensic experts discovered 'no evidence of modification, alteration, addition or deletion' in the user files of any of the three laptop computers, three USB thumb drives and two external hard disks seized during a Colombian anti-narcotics and anti-terrorist operation on a FARC camp on 1 March 2008."

But Interpol admitted that lacking evidence doesn't prove "there was no tampering." In fact, some files had future date stamps and other indications of data alteration. It questions their authenticity, and Interpol (deep in its report) acknowledged that Columbia likely manipulated the contents - with an explanation needing close reading to understand. It delegitimizes Colombian claims and would get an international court to dismiss them out of hand. Reporters doing their job should as well. Data accuracy can't be verified or worse - they may be entirely fraudulent, and made-in-Washington mischief may be behind it.

Interpol's report continued saying "between 1 and 3 March, direct access to the seized computer exhibits....did not follow internationally recognized principles in the handling of electronic evidence under ordinary circumstance." Its experts "verified that this....had no effect" on file contents, but other report evidence contradicts that statement. Interpol, in fact, stated that "Direct access may complicate validating this evidence for purposes of its introduction in a judicial proceeding because law enforcement is then required to demonstrate or prove that the direct access did not have a material impact on the purpose for which the evidence is intended."

In short, hard drive data prove nothing and may, in fact, be fake. With US involvement clear, it wouldn't be the first time, and Washington is rich in talent to do it.

Independent computer experts are also troubled. They believe that failure to follow standard evidence handling procedures seriously jeopardizes its reliability. With care, forensic specialists or computer professionals can add, delete or alter hard drive material without leaving a footprint.

Dominant media reports ignored this and more. They passed over or played down key findings, including Interpol's statement: that its experts didn't "evaluate the accuracy or the source of the exhibits' content." How could they? The volume was enormous amounting to the equivalent of "39.5 million pages in Microsoft Word...." At the rate of 100 pages a day, "it would take more than 1000 years to read" it.

That alone begs the question. In a few days or even weeks, how were Colombian authorities able to analyze the data to discover provocative information therein. That notion also got no attention in the dominant media. Neither did most other parts of the truth.

Spinning the News - How Big Media Does It

Here's how Murdoch's Wall Street Journal's played it on May 16. Its editorial page said Interpol's May 15 report "won't make Venezuelan strongman Hugo Chavez's day." It reported Interpol's claim about no evidence of file tampering, but ignored the issues of authenticity, accuracy, manipulation, or impossible "speed-reading" skills of Colombian verifiers. It concluded that "Interpol's certification proves that Mr. Chavez is trying to destabilize a US ally (and that he's a) proven supporter of terrorism in our own hemisphere."

The New York Times' Simon Romero was little better. His May 16 article was headlined: "Files Tying Venezuela to Rebels Not Altered, Report Says." He called Interpol's report "a setback for Venezuela, which had claimed that the computer files....were fabrications...." It "may advance efforts under way in the Congress to add Venezuela to the United States' list of state sponsors of terrorism...."

Well down in his report, Romero admitted that "Interpol could not vouch for the accuracy of the files" and that "a Colombian antiterrorism unit (seized them improperly and) in violation of internationally recognized rules on handling electronic evidence...." No further comment was added.

In contrast, Romero played up State Department spokesman, Sean McCormack, saying these "are serious allegations about Venezuela supplying arms and support to a terrorist organization....that has deep implications for the people of the region." He had to acknowledge, however, what credible experts agree on. Given the importance of US and Venezuelan relations, chances of declaring the country a state sponsor of terrorism is highly remote - "particularly without more evidence (read any evidence) of the country's support of the FARC..."

Latin American history professor Greg Grandin goes further. He believes "Almost all of Latin America and most of the world would take Venezuela's side in this dispute. Any move (against the Chavez government) would further isolate the United States in a region where it has been hemorrhaging influence."

That doesn't phase Romero. Piling on is his specialty. Truth isn't. He returned on May 18 with a provocative feature story headlined: "Chavez Seizes Greater Economic Power." Some key points in it are:

-- "Chavez is intensifying state control of the Venezuelan economy through a wave of takeovers of private companies and creation of government-controlled ventures with allies like Cuba and Iran; fears are intensifying (over) more nationalizations;"

-- it's happening "just months after voters rejected a referendum to give the president sweeping constitutional power (leading critics to accuse him of being) more interested in consolidating power than in fixing Venezuela's problems;"

-- "while he has argued that (he aims) to correct social injustices and fight soaring inflation, his critics say his moves are instead compounding these troubles;" no supporter voices in sight;

-- to avoid "outright confiscation (he's) offering 'some' compensation;" unmentioned is it's fair market value and nothing was, is or will be "confiscated;"

-- Romero stresses Venezuela's ties to Iran and China with joint ventures and infrastructure projects; also that Chavez will "export more oil to China in exchange for more Chinese investment in Venezuela;" implied, of course, are his relations with US rivals, and, in the case of Iran, a country George Bush calls "the world's leading state sponsor of terrorism;"

-- he ignores Venezuela's successes; along with Argentina, it's the fastest growing regional economy and one of the fastest in the world at a time of economic weakness; its impressive employment growth with most of it coming in the private sector; that Chavez is friendly to business and boosts the private economy; the country's huge social gains; and Chavez's immense popularity and growing world stature; instead he lists problems - high inflation, less foreign investment, food shortages, capital flight, and more that are only mitigated by "high oil prices;"

-- near the article's end, he's forced to admit what economist Mark Weisbrot explains - that Chavez "is so far mainly just reversing some of the privatizations that took place in the 1990s;"

-- Romero reverts to form with some provocative ending quotes about Chavez "stimulating a pre-insurrectional climate;" that his nationalizations aim "to annihilate the productive apparatus so that we depend more on petroleum, which is to depend more on the state, or in other words, to depend more on Chavez."

For the dominant US media, Chavez-bashing is full-time. Washington Post writers excel at it on any pretext, and Juan Forero's May 16 Interpol report article was typical. It's headlined: "FARC Computer Files Are Authentic, Interpol Probe Finds." He echoed the Wall Street Journal and New York Times and said files seized "contain e-mails (Interpol never mentioned any) and other documents that show how Venezuela's populist leader had formed such a tight bond with guerrilla commanders that his key lieutenants had offered help in obtaining sophisticated weaponry such as surface-to-air missiles while delivering light arms. The files also document links between FARC and Ecuador's president, Raphael Correa, a close ally of Chavez."

Similar reports appeared throughout the US and western media. They never miss a chance to play down facts and attack populist leaders. In response, Hugo Chavez dismissed the allegations as "ridiculous." He urged Colombia's president to have "a moment of reflection (and added) The government of Columbia is capable of provoking a justify a US intervention in Venezuela." He also called Colombia's assertion "a new act of aggression." It means relations with his neighbor will come "under deep review," and Reuters reported May 15 that "Venezuela is deeply revising diplomatic, economic and political relations with Colombia" following Interpol's report and the Uribe government's allegations.

Ecuador's Correa was abroad in France, but took time to say the computer file documents "prove absolutely nothing. We have information that the Colombian government had the computers for some time and prepared all this." Quite possibly because the entire story is unraveling. But don't expect Big Media to report it.

Revving Up Gunboat Diplomacy

While it continues, the Pentagon announced in April that it's resurrecting its Fourth Fleet in Latin America and the Caribbean after a 60 year hiatus. It was created during WW II and disbanded in 1950. Reasons given were vaguely stated - to "conduct varying missions including a range of contingency operations, counter narco-terrorism, and theater security cooperation activities."

US Naval Forces Southern Command chief Admiral James Stevenson said the move would send a message to the entire region, not just Venezuela. Commandant of the National War College, General Robert Steel added that: "The United States' obsession with Venezuela, Cuba and other things indicates they are going to use more military force, going to use that instrument more often." Bolivian President Evo Morales called the move "Fourth Fleet....intervention."

The Fleet begins operating in July and will be headquartered out of Florida's Mayport Naval Station. It'll be part of the Pentagon's Southern Command, extending from the Caribbean to the continent's southern tip. Its strength will be formidable - aircraft carriers, submarines, various attack ships, and several nuclear-armed ones.

With no Latin American threat, why then this move, and why now with an administration nearing its end and bogged down in two unwinnable wars? Like the Middle East and Central Asia, the region's importance is crucial. Venezuela alone is why. Its proved oil reserves were just raised to 130 billion barrels, but include what's uncounted and they're far higher. On its web site, the US Department of Energy (DOE) estimates the country's extra-heavy oil at 1.36 trillion barrels, or 90% of the world's total. That's more than all "proved" world reserves combined and in addition to Venezuela's "proved" light sweet resources of around 80 billion barrels that alone ranks it seventh in the world behind the five largest Middle East producers and Canada.

With stakes that high, it's significant that Admiral Joseph Kernan will become Fleet commander when it's activated. He currently heads the Naval Special Warfare Command that includes Navy Seals and other counterinsurgency units. His choice is troublesome, and regional leaders are mindful. Hugo Chavez especially. It may be why he's buying nine Russian submarines, but against America it hardly registers. In total, Venezuela spends $1 - 2 billion on its military annually or less than half of 1% of the Pentagon's budget. Nonetheless, it's another reason Washington targets him with a hawkish commander now charged to do it.

Rumor also is that the Pentagon plans building a Colombian military base near Venezuela's border. Washington's Colombian ambassador, William Brownfield, said it's possible if its Manta, Ecuador one is closed. Its lease expires in 2009, and Raphael Correa said renewal depends on the US granting Ecuador equivalent basing rights in South Florida - his way of confirming renewal won't happen.

Chavez is justifiably alarmed at the prospect of US troops on his border. He warned Colombia not to do it and said this action will force Venezuela to revive a decades-old territorial conflict over its possible La Guajira location. He further added: "We will not allow the Colombian government to give La Guajira to the empire." Stationing US troops there will be "a threat of war at us." So far, neither Washington or Colombia confirm what's planned. But Colombia's defense minister, Juan Manuel Santos, denies the base rumor, at least in La Guajira. In a May 14 televised address, Chavez called it "good news." Nonetheless, the situation bears watching.

Chavez is justifiably wary. As long as he's president, he'll be vilified and targeted. Latin America is vital to Washington. Venezuela is a key part of it. But America's dominance is weakening, neoliberal pillage caused it, the Bush administration accelerated it, Bolivarianism challenges it, so muscular militarism may replace diplomacy to restore it.

Colombia's belligerency, the FARC-EP files, Fourth Fleet reactivation, continued funding of Venezuela's opposition, CIA's covert mischief, disruptive street violence, and other planned schemes are troublesome. They're to reassert regional control and rid Washington of its leading hemispheric antagonist. No guessing who, and no telling when the next attempt will come or in what form. Everything tried so far failed. Even worse, it's been counterproductive. Chavez has enormous stature and immense popular support.

That makes him an even greater threat and hints at something bigger coming. So far, it's just speculation, however, with the administration's tenure winding down. But it may or may not deter those running it who are always wrong, never in doubt, and apparently willing to risk making a bad situation worse. Stay tuned, expect surprises, and be assured the months ahead won't be boring.

Stephen Lendman lives in Chicago and can be reached at

Also visit his blog site at and listen to The Global Research News Hour on Republic Mondays from 11AM to 1PM US Central time for cutting-edge discussions with distinguished guests. All programs are archived for easy listening.

Friday, May 16, 2008

Grow Them Young, Pay Them Well - Anti-Chavistas, That Is

Grow Them Young, Pay Them Well - Anti-Chavistas, That Is - by Stephen Lendman

Who said crime doesn't pay? Read on.

The Washington-based Cato Institute is all about "Individual Liberty, Free Markets, and Peace," or so says its web site. It's been around since 1977 preaching limited government and free market religion with plenty of high-octane corporate funding for backing. It better have it for the award it presented on May 15. It was to a 23 year old fifth year Venezuelan law student at Universidad Catolica Andres Bello. Yon Goicoechea was the fourth recipient of the "Milton Friedman Liberty Prize" in the amount of $500,000. For what? What else. For serving the interests of capital back home and leading anti-Chavista protests.

Goicoechea is leader of Venezuela's "pro-democracy student movement" that in Cato's words "prevented Hugo Chavez's regime from seizing broad dictatorial powers in December 2007." The reference is to the narrow defeat of Venezuela's reform referendum last December. Goicoechea led student-organized street violence against Venezuela's democracy, but don't look for Cato to say that.

It played up Goicoechea's "pivotal role in organizing and voicing opposition to the erosion of human and civil rights in his country (that) would have concentrated unprecendented political and economic power in the hands of the government." Instead, he chooses "tolerance" and the "human right to seek prosperity." He's been active since student and other opposition emerged against the Chavez government's refusal (with ample justification) to renew RCTV's VHF operating license last May.

Then, and in the run-up to last December's referendum, Cato says he stood down "ongoing death threats and continual intimidation due to his prominent and vocal leadership." He's been "indispensable in organizing massive, peaceful protest marches that have captured the world's attention." In fact, there were no death threats but plenty of hard right intimidation targeting Chavistas with tools like Goicoechea a part of it.

Cato founder and president Edward Crane said "We hope the Friedman Prize will help further his non-violent advocacy for basic freedoms in an increasingly militaristic and anti-democratic Venezuela." Far right novelist Mario Vargas Llosa added that "freedom is disappearing" in Venezuela, and "Goicoechea is a symbol of (a) democratic reaction when (it's) threatened."

Goicoechea received his award at a $500 a plate dinner at New York's Waldorf Astoria. Prominent corporate and government types attended, all representing far right interests. None explain how Bolivarianism works, its participatory democracy, its commitment to Venezuela's people, or how it's lifted millions in the country out of desperate poverty. Nor is there comment on a model process, impressive social reforms, supremely democratic elections, or Hugo Chavez's immense popularity. An April 24 - May 2 Venezuela Data Analysis Institute (IVAD) poll puts him at 68.8%. That compares to comparable George Bush ones with some of the lowest ratings ever for a US president.

No discussion either of how student opposition is funded or for what purpose. That their money comes from US agencies like the misnamed National Endowment for Democracy, USAID, the International Republican Institute, and other pro-business US and international agencies and organizations. CIA's part of it, too.

Highlighted are Goicoechea's plans with the money - to challenge Bolivarianism back home and work to subvert it. With those ideas and Cato's backing, he's sure to remain a hard right favorite. He'll also be busy and well-compensated - for more destabilization against the most democratic government in the hemisphere. That's what Goicoecheas are for - to sabotage democracy, subvert equity and justice, topple populist governments, and make Venezuela "friendlier" for business.

Goicoechea now heads home fully briefed for his role, but don't expect Cato to explain it. It's to support capital's divine right, privilege over beneficial social change, and the rights of the few over the many. It's to mobilize indignation against a leader who works for all Venezuelans, especially those in greatest need. Who uses his country's oil wealth for his people, not elitist business interests. For having a Constitution that mandates it. For gaining overwhelming popular support and becoming a hero to millions. For wanting others to share in what Venezuelans have. For believing all people matter, not just the privileged. For becoming the greatest of all threats to the empire (and Cato) determined to stop him. For failing so far. For seeing him gain strength and stature. For securing grassroots allies everywhere. For needing many Goicoecheas to oppose him, but not nearly enough to prevail.

His "non-violent advocacy" and "peaceful" protesting went like this - promoting class warfare; wanting Chavez toppled; and following CIA diktats to:

-- "take to the streets; protest with violent disruptive actions across the nation; create a climate of ungovernability; provoke a general uprising; isolate Chavez" internationally; destabilize the government; disrupt the constitutional process; sustain aggressive agitprop; build unity among the opposition; and end Chavismo and Bolivarianism so capital can get back in control.

Last year, Goicoechea responded by engaging in violent street clashes; targeting pro-Chavez students, police and the National Guard; smashing windows; turning over and setting cars alight; starting other fires; burning tires; throwing rocks and bottles; engaging in a shootout at Caracas' Central University; seeing Venezuela's business media report "peaceful, civic and democratic" students were attacked without provocation; and getting full US (and Cato) backing for all of the above.

Like others of his class, Goicoechea enjoys privilege and wants to keep it. He's also unwilling to share it, and he puts it this way: "We have to fight for our future, for our rights," and you know whose he means. "If we don't fight for our freedoms, we won't be able to take part in a democratic Venezuela in the future." He means democracy for the few like in pre-Chavez days.

Gabriela Calderon shares that view as editor of, Cato's Spanish language website. She's young, well-educated, anti-Chavez, and also against Bolivarianism's spread to her native country of Ecuador. Cato says she's a "frontline" warrior in "the struggle against Hugo Chavez's '21st century socialism,' which is threatening to engulf all of Latin America." She, in turn, calls populists like Chavez and Ecuador's President Raphael Correa "the reactionary right" for in Cato's words: "pushing for greater state control over the economy and people's lives. By contrast, she - and - advocates for individual freedom." That means privatizing everything, favoring property over people, privilege over the needy, crowding out dissent, and getting well-rewarded for supporting all of the above.

These are imperial interests. Youths like Goicoechea and Calderon are its tools, and organizations like Cato are front and center supporting them. It's bankrolled by business, given clear marching orders, and they're full of high-octane markets uber alles religion. But in the spirit of "Individual Liberty, Free Markets, and Peace." Orwell would approve.

Stephen Lendman lives in Chicago and can be reached at

Also visit his blog site at and listen to The Global Research News Hour on Mondays from 11AM - 1PM US Central time for cutting-edge discussions with distinguished guests. All programs are archived for easy listening.