Monthly Archives: June 2015

On the eve of June 30th, Egypt’s public prosecutor killed

Egypt’s Prosecutor General Hisham Barakat, who oversaw the Raba’a and Nadha massacres, and the slew of death sentences against opposition figures since December 2014, was killed today Monday 29th June after his convoy was bombed in Cairo. Nothing happened to the chauffeur and nine bodyguards, or indeed to any of the police in the area.

The Revolutionary Council has blamed junta leader Sisi for the assassination, citing the desperation of his régime, and its willingness to go to any lengths to raise the stakes towards a more violent confrontation with the population. Western media meanwhile is marketing the régime’s story that it is an ‘Islamist provocation’ before the anniversary of the 30th June demonstrations two years ago that brought Sisi to power.

حمل المجلس الثوري المصري, حكومة الانقلاب وقائده عبد الفتاح السيسي، مسئولية مقتل النائب العام “هشام بركات”, بإشعالهم مسلسل العنف وقتلهم وسجنهم آلاف الأبرياء.  وقال المجلس الثوري في بيان له, منذ قليل: “فاجأنا اليوم نبأ استهداف نائب عام سلطة العسكر، عقب انفجار مروع، ونحن نحمل الانقلاب في مصر مسئولية ذلك الحادث، كما نحمل قائد الانقلاب شخصيا مسئولية مسلسل العنف الذي تشهده البلاد منذ ٣ يوليو ٢٠١٣ وحتى الآن.  وتابع البيان: “ذلك العنف الذي تصنعه وتؤججه سلطة العسكر بسياساتها وأفعالها. لقد وضعتنا سلطة العسكر في طريق واحد ولا بديل غيره أن نتوحد جميعا على هدف واحد، هو إنهاء سلطة القمع والقتل والعنف والاستبداد، وإسقاط حكم العسكر تماما؛ من أجل تمكين الشعب المصري من حريته وتحرير إرادته دون خداع أو استعباد أو هيمنة أو خوف.  واختتم المجلس: “إننا ماضون من أجل ثورة ناضلت وضحت كثيرا من أجل العيش والحرية والكرامة الإنسانية، وإننا لمنتصرون بعزيمة وصدق وثبات وإقدام المخلصين، وإن غدا لناظره قريب

Propagandist Ahmad Moussa to Sisi:

The fifth column are saying the same thing as the Muslim Brotherhood – that you killed Hisham Barakat! If you don’t kill (President) Morsi, we’ll go and do it ourselves!

 

In Sisi’s Egypt corruption of the mind seamlessly follows the political, judicial and financial corruption

Shawki Ibrahim Abdel-Karim Allam is Grand Mufti of Egypt, a position which should in theory earn someone respect, yet Allam plagiarised Sayyid Qutb’s 1954 renowned book Fi-Zilal Al-Qur’an (In the Shade of the Qur’an) wholesale for an article in Egypt’s Youm7 newspaper, which he attributed to himself. The fact that he thought nobody would notice is absolutely astonishing.

Abbas and his government finally present their case to the ICC

We have followed the matter of the Palestinian Authority and the ICC closely on this site, and despite everything, Mahmoud Abbas signed the Rome Treaty in December 2014 and is now presenting the Palestinian case to the Hague tribunal.

In fact, today – June 25th, Riyad al-Maliki, the Palestinian foreign minister, is presenting a dossier to the ICC detailing war crimes and crimes against humanity allegedly committed on Palestinian territory by Israel and the Israel Defence Forces (IDF). The report deals with three main areas: illegal Israeli settlement activity, the treatment of Palestinian prisoners, and last summer’s war in Gaza. It covers the period from 13 June 2014 to 31 May 2015, and media reports suggest that among other things, it includes information about Israel’s development of 2,600 housing units in occupied East Jerusalem, and the killing of four boys on a beach in Gaza during the war. It details settlement expansion, house demolitions, land confiscation, and destruction of Palestinian property and olive trees by settlers and soldiers.

Greece and the astonishing EU game of plates on sticks

The EU will go to any lengths to give the impression that Greece is a viable entity and keep it locked in a game of financial smoke and mirrors, simply because the EU is working for the banks, especially the German ones. Greece bankrupted itself years ago because it was was able to borrow by issuing bonds in a debt market propped up by the European Central Bank (ECB). While this site has been following Japan’s economic demise with considerable interest, as a cornerstone of the impending implosion of the world financial markets, Greece is extraordinary because of the fact of such a small economy keeping the whole EU in thrall and threatening its very survival.

In 2001 Greece’s public debt was about $150 billion (100% of its nominal GDP). Because of the ECB’s artificial propping up of the European bond markets, by 2010, Greece’s public debt had soared to $380 billion, thus growing at a compound annual rate of 10% for the decade. This occurred despite the fact that Greece’s notoriously corrupt, inefficient, and special interest dominated economy was never reformed.  In fact, the ECB’s quantitative easing (QE) in the European bond markets rewarded the Greek government with a dramatic drop in the 10-year bond yield between 2001-2008, such that even by the time the crisis hit in early 2010 it was only 5.5%, a yield that would normally be impossible for a basket case like Greece to obtain.

greece-government-bond-yield

The ECB had thrown money to the winds in that same 11-year period ending in 2010, its balance sheet soaring threefold, growing at an 11% annualized growth rate. So the QE printing presses in the Frankfurt European Central Bank so falsified euro bond prices, that even with yields on Greek bonds being above all other European yields to account for extra risk, the Greek state was able to borrow itself into bankruptcy.

greece 2 euro-area-central-bank-balance-sheet

Between 2001 and the 2009 peak, the Greek economy appeared to surge—-with nominal GDP expanding from $150 billion to $340 billion or by 10% annually, in a debt fuelled bubble of public and private construction investment and new household consumption on the part of Greece’s public employees and social beneficiaries. This boom in GDP based on a fake bond market, was thus a fake boom, giving the false appearance that the ratio of debt/GDP had only reached 115% by 2008—- when in fact the true underlying ratio was soaring. In this Alice in Wonderland world, Greek politicians drastically increased pensions and other social welfare programs.

Thus the debate between Alexis Tsipas and Yanis Varoufakis of Syriza and the troika apparatchiks about the “austerity” package is really, like everything else here, a fake one. Where Greece, in the graph below, has actually reduced nominal outlays for its pension and old age programs by 6 billion euro or 16% since the peak in 2009, in the prior 3 years alone it had increased these outlays by 35% (and by upwards of 60% since first joining the eurozone). The recent rollbacks and pension cuts, therefore, amount to some recoupment of unaffordable previous rises based on a debt-fuelled bubble economy.

Greek 3

So simple arithmetic tells us that the “austerity” to which Greece has been subjected is not the result of Troika (EU, ECB, IMF) policies, but the result of its shrinking GDP: Greece’s sustainable GDP in 2008 was never the $340 billion it actually posted. The drop toward $200 billion is simply the liquidation of a bubble economy that was dependent on massive unrealistic new injections of debt. To pretend that this mirage can be restored by the elimination of the fiscal constraints being imposed by Greece’s lenders is a commentary on today’s general financial madness.

greece-gdp4

Nevertheless the Troika bailouts and conditionalities have no merit whatsoever, saddling Greece with illegitimate, onerous, predatory debt that it should be ejected in a process of default, since Greece is in fact bankrupt. The $380 billion of gross public debt that existed in 2010 should have been shrunk to a fraction of that amount in what should have been a proper process of bankruptcy.

As it happened, most of that debt was simply transferred from the banks and bond managers of Europe to the taxpayers of the eurozone. The elected politicians of Greece did not want this bailout in the first place; it was forced on them by French, German and Italian authorities in order to bailout their own financial institutions.

So at present Greece’s current public debt ratio is 180% of GDP, and simply cannot be serviced over the long run. Given that interest rates must eventually normalize, since permanent QE is not possible, the potential rise of 3-5% on Greece’s debt service cost would have unconscionable results. Given that reality, the idea that Greece can work itself out from under its massive debt burden by running 1-5% of GDP primary surpluses in its budget is absolute rubbish, so the whole current exercise is a matter of kicking the can down the road.

Had the ECB’s Draghi not announced he would massively monetize euro sovereign debt in July 2012 through QE, Greece would have been bankrupt long ago, and the peripheral borrowers like Italy, Spain and Portugal would have had their day of fiscal reckoning, too. The eurozone would have blown sky high, and the ECB would be no more. Likewise, were not the ECB now supplying $125 billion of funding to the Greek banking system—or actually more than its current level of fast vanishing deposits—-the latter would also have crashed and burned months ago, thereby triggering a crisis which would have eventually destroyed the euro.

When Greece’s prime minister, Alexis Tsipras, despite everything, says that “We have no right to bury the European democracy in the land where it was born”, he is right in political terms, and, in that respect, if Greece’s democracy is to survive, it must be cut loose from the destructive regime of superstate dictation from Brussels and monetary falsification from Frankfurt. Then, going back to the Drachma would put Greece’s politicians right were they were before they were betrayed by the false monetary regime of eurozone central banking. They would be forced to run a primary surplus because they would not be able to borrow on world markets after a massive default on the debt forced upon them by the Troika.

The necessary mix then of taxing the rich, cutting the pensioners, catching the tax cheats, selling state assets, shrinking the bureaucracy and squeezing the crony capitalist companies which feed on the Greek state, would be up to Greek politicians, not the apparatchiks of the IMF and the European superstate, which is the way it should always have been. Furthermore, faced with an honest bond market, the Greek state would rediscover the requisites of sustainable fiscal governance. But Tsipras is now confronted with this kind of hard choice facing the Troika. If he sells out Greece one more time to the paymasters of his country’s crushing debt, it will be only a matter of time before another Greek prime minister will be forced to walk the same plank on which he now balances.

By doing what’s right for Greek democracy, by contrast, he would prove to be an angel of mercy. There is no way that the euro and ECB could survive a Grexit, nor could worldwide profligate central banking survive the blow that would emanate from this demise.

No wonder the assembled powers of the world will move heaven and earth in the days ahead to keep Greece locked in the debtor’s prison that has replaced honest free markets in sovereign debt. To this end, they may yet turn Tsipras into a faithless “trusty” of the wards, but to do so they will have to again make pigs fly——at least for a little while longer.

-with thanks to David Stockman for the substance of this post

Turkish coalition politics

Osman Can writes:

While the AK party remains by far the single biggest party, it needs a coalition partner if it is to form a majority government. Turkish media outlets have reported that the idea of partnering with the CHP has been becoming increasingly popular for the AK Party leadership. It is no secret, however, that the AK Party base would rather have their party work with the MHP. At this point, it looks extremely unlikely that the AK Party will partner up with the HDP.

Although big business is pushing for a grand coalition featuring the AK Party and the CHP, which might facilitate the drafting of a new constitution, and thus fulfil one of the important policy goals of the AK party in the next Parliamentary term, CHP voters are nothing like the AK Party base. The overwhelming majority of the CHP base leads secular lives and identify as center-left voters. Traditionally, tensions between this group of secular-minded leftists and conservative AK Party supporters have been quite significant.

A partnership between the two parties, in this regard, could possibly remedy the widespread polarization and have an overall positive influence on various social groups. It is perhaps more important to acknowledge that a coalition of polar opposites might generate the necessary momentum to implement legal and constitutional reforms. Considering that the CHP leadership has revised its position on the Kurdish question, there is a good chance that the prospective coalition government could devise a peaceful solution.

A coalition government with the MHP, in turn, would hardly create similar opportunities for Turkey. The AK Party would avoid political turmoil by partnering with the MHP, but the venture might indeed fail to play a constructive role while at the same time, placing the Kurdish reconciliation process at risk.

See: http://www.dailysabah.com/columns/osman-can/2015/06/24/the-coalition-games

(Editor: so, on Can’s view, previous commentary here that the Kurdish reconciliation process might be the main casualty of the new Turkish coalition process, which would be the case if the best fit for the AKP is with the MHP, is not correct. On the other hand, if the reconciliation process with the Kurds continues and a coalition with the CHP is successful, Turkey would experience its first inclusive government, signalling a major new phase forward for the country)

Sisi régime punishing Gaza again

Egyptian authorities have started to dig a new tunnel in the Sinai Peninsula along the border with the Gaza Strip. The tunnel is intended to monitor the smuggling tunnels between Egypt and Gaza. These tunnels are Gaza’s lifeline – but the Sisi government  claims that they are a threat to its security. The tunnel is expected to be dug 2km from the actual border; it will be 20m underground and 10m wide.

Ahmad Mansour freed

This morning, Monday 22nd June, the German Attorney general freed Ahmad Mansour.

According to al-Jazeera broadcaster, Ahmad Mansour, in his latest video, there were no formal extradition or judicial agreements between Germany and Egypt, and therefore previous reports that Germany held Mansour on an Egyptian warrant are incorrect.

Mansour had said at the time: “The airport authorities detained me based on an Interpol order at the request of the Egyptian authorities. I informed [the police] that the global police organization has rejected Egypt’s request and that I have this document from Interpol to prove that I am not wanted on any charge. I also told them that all the cases that were filed against me in Egypt were fabricated. They, however, insisted on holding me in their detention center for investigation. They told me that they will transfer me to face an investigating judge who will determine my case.” See:

https://www.youtube.com/watch?v=jZcxLW6hgHM

Apparently a German legal procedure was being carried out based on a specific agreement between Merkel and Sisi and relating to Ahmad Mansour. Clearly, there was no basis for it under German law.

See analysis of deal between Germany and Egypt

http://www.counterpunch.org/2015/06/05/merkel-and-sisi-games-of-thrones-the-comic/

 

When Google met Wikileaks

In June 2011, Julian Assange met the chairman of Google, Eric Schmidt, at Ellingham Hall, the country house in Norfolk, England where Assange was living under house arrest. The two men debated the political problems faced by society, and the technological solutions engendered by the global network—from the Arab Spring to Bitcoin. They seem to have outlined radically opposing perspectives: for Assange, the liberating power of the Internet is based on its freedom and statelessness. For Schmidt, emancipation is at one with U.S. foreign policy objectives and is driven by connecting non-Western countries to Western companies and markets. These differences embodied a tug-of-war over the Internet’s future that has only gathered force subsequently.

download Assange’s book on the subject here:

Julian Assange – When Google Met WikiLeaks

Initial information from Wikileaks’ Saudi cables

Cables leaked from its Interior Ministry appear to reveal the extent of Saudi Arabia’s funding of various media outlets. This emerges from WikiLeaks’ leak of over 61,000 documents published on Friday, which are the first of around half a million to be released over the coming weeks, and are expected to be embarrassing to the kingdom and its allies

One of the documents (see: https://www.wikileaks.org/saudi-cables/doc124708.html) apparently sent from the Interior Ministry to the Ministry of Culture and Media in 2010 approves payments to media outlets across the region. Newspapers and sites in Syria, Jordan, Kuwait, the UAE, Lebanon and Mauritania reportedly received sums of up to $32,000 each per year, in massive subscriptions which are intended, in the words of Wikileaks, “to control Arab media” (see: https://wikileaks.org/saudi-cables/buying-silence).

However, this is not limited to the Arab world. In Australia, massive subscriptions are made to the Telegraph, the Middle East East Times and other publications (see: https://www.wikileaks.org/saudi-cables/doc116429.html). In Canada this also applies to various publications (see: https://www.wikileaks.org/saudi-cables/doc117189.html). Many other publications across the world are also involved (see: https://www.wikileaks.org/saudi-cables/doc118126.html, and: https://www.wikileaks.org/saudi-cables/doc123389.html).

Furthermore, payments are made to Burundian politicians with control over local radio stations. (see: https://www.wikileaks.org/saudi-cables/doc116887.html), and most extraordinarily payments have been made to out-of-favour reformist Iranian politician Ata’ollah Mohajerani for his son Ali to be able to complete his PhD at Warwick University, Coventry UK, at a cost of £12,115 p.a. for four years plus £4,256 p.a. housing expenses, payments totalling some $65,000 altogether (see: https://wikileaks.org/saudi-cables/doc1322.html, and, more generally: https://wikileaks.org/saudi-cables/search?q=%D9%85%D9%87%D8%A7%D8%AC%D8%B1%D8%A7%D9%86%D9%8A&exclude_words=&types[]=1&types[]=2&types[]=3#results).

During the Arab Spring in 2011, the cables show concern that Egyptian newspapers were being driven by public opinion rather than turning around and driving it themselves (see: https://www.wikileaks.org/saudi-cables/doc124314.html). The idea, also displayed in the cables, of paying Egyptian authorities $10 billion in the period just before Mohamed Morsi came to power, in order to release Hosni Mubarak from prison (see: http://different-traditions.com/?p=2633) obviously came to nothing. However, clearly the very thought suggests the importance of the old dictator for the Saudi rulers.

Clearly, much more information is on its way.