Archive for the 'World Affairs' Category

Prospects for Democratic Redistribution of Wealth

Wednesday, August 27th, 2014

Capital in the Twenty-First Century, Thomas Piketty, 2014

An important new work based on many years of meticulous research and made possible by improvements in research materials and methods. French economist Piketty decries economic thought in the past from Malthus to Marx to Kuznets (and this reader adds Milton Friedman of the Chicago School) who first arrived at their theories and conclusions and then sought evidence to support their pre-conceived conclusions. He equally decries modern mathematical economics for trying to reduce a complex and human subject to a few sterile and usually unhelpful formulas.

Honore’ de Balzac Balzac Jane Austen jane austen

Piketty was able to collect considerable data for the entire period from 1700 to the present. The most complete data are available for England and France for the entire period. The period from 1700-1914 was characterized by relative stability of the economies with national incomes growing at 0 to 1½% and with populations and inflation growing at about the same rate. Piketty’s primary focus in this work is the inequalities in individual incomes and wealth. He uses the novels of Jane Austen in England and Honore’ de Balzac in France to give a very specific sense of what it meant to be wealthy and how much income was necessary to live well. The novels are very specific giving numbers in Pounds and Francs so it was possible for readers up to 1914 to get an exact sense of the meaning of the character’s income and wealth and their consequent place in society.
Piketty’s first conclusion is that the relative stability of the period 1700-1914 is the typical state of the world’s economy barring major upsets such as occurred in the period form 1914-1945 and that we are heading into another period of similar stability in the twenty-first century, barring new major catastrophes. The reason that those living today who grew up after WWII and therefore lived through an unusual period of higher growth as the world economies recovered from the catastrophes of 1914-1945 have an expectation of growth that it has been their personal lifetime experience. The data indicates that long term the outlook is for low income growth, low population growth, and low inflation.

piketty capital vs growth

Piketty’s second conclusion is that individual wealth (capital) and its concentration grows over time because the return on capital exceeds the growth in output except in times of extreme catastrophes such as the period 1914-1945. Furthermore, wealthier individual’s or institution’s (like the Harvard $30+ billion endowment) return is higher than less wealthy individual’s or institution’s returns. This gives a long term trend toward an extreme concentration of wealth.
Piketty believes that messy and human democratic processes are the only viable means for societies to determine the proper role of government in society. For Piketty, public education, public health care, and aging security are minimum required functions of government. Public transportation and other infrastructure are also essential. These minimum public requirements cannot be privatized. Piketty specifically does not mention military defense security. To pay for these public functions, the government must raise money and they have a choice of taxation or debt to do so. Government debt requires repayment and so ultimately taxes must be raised to pay for government functions. Debt increases the cost of government, transfers the cost to a later time, and further enriches those wealthy enough to loan to the government. For all these reasons, Piketty believes that government debt must be limited. Big economies are very wealthy and Piketty finds no reason to worry that excessive government debt will transfer ownership to foreign sovereign funds or to any small number of wealthy individuals but excessive government debt is still undesirable and should be avoided. Talking about the recent Greek experiences with the large scale sale of public assets to private owners to reduce government debt levels, Piketty says that wealthy Greeks simply preferred this solution to paying more taxes which they could easily have done with little long term impact on their personal fortunes.

income-inequality-usa-13

Even before 1914 the Europeans were experimenting with progressive taxes on individual incomes and with estate taxes on the inheritance of wealth. In the ensuing period 1914-1945 extreme tax rates up to 90 percent were levied on incomes and estates. These taxes along with extreme inflation (1913-1950 France averaged 13% and Germany averaged 17%) along with direct confiscation of assets caused a great decrease in wealth and income and a great decrease in income and wealth inequality. Piketty says that the French Revolution did not decrease income and wealth inequality in France as much as is commonly believed and wealth quickly consolidated again immediately following the first violence of the revolution. While revolutions, wars, and economic depression all reduce income and wealth inequality optimistic Piketty believes these goals should be achievable by less catastrophic means. The solution to reduced inequality is progressive income and inheritance wealth taxation and Piketty argues that far less extreme rates of progressive taxation can achieve the desired end of reducing inequality if moderate progressive taxation is maintained consistently over the long term. In 2010 taxes as a percentage of national income were 55% in Sweden, 50% in France, 40% in Britain, and 30% in the US. Up til 1910 wealthy countries taxes seldom exceeded 10%.
In comparing Europe and the US today, Piketty finds the US by far the least economically (and socially) mobile society. Most great US Universities are private and their students almost all have wealthy parents. Education in the US is no longer a path to upward mobility. Even the public Universities in the US have skyrocketing costs putting them out of reach of all but the wealthiest families. Oddly, Piketty does not discuss students accumulating massive er-reputable debt to finance their own educations going into indentured servitude to banks or the US government. Most of the top jobs and highest incomes are then given to graduates of the elite universities. He talks about the philanthropic uses of great wealth such as that of the Gates Foundation, but he clearly would prefer the society as a whole make these philanthropic decisions rather than a single wealthy individual. These decisions are the proper role of democratic decision making.

income-inequality-usa-05

In 2010 the top 10% of the US working population got 58% of total income while in Europe the top 10% got 30%. In 2010 total wealth for the US top 10% was about 70% and for the top 1% was 35%. The top 10% of Europeans owned 90% of wealth in 1900 and that level dropped by 2010 to 60%. Piketty suspects that wealthy individuals and institutions hide one third or more of their actual income and capital. Judging by US Presidential candidate Romney, Piketty is probably underestimating the problem of hiding wealth from taxation.
Historically, Piketty notes that foreign ownership of capital was highest in France and Britain during the colonial period and dropped to negligible levels after WWII. He also notes that the capitalization of labor in the US slave south was a significant feature in US wealth up to the civil war. Capitalizing 40% of the total population of the US south meant that US slave owners were far wealthier than their European counterparts of the period. He notes, wryly, that Thomas Jefferson owned 600 slaves about which he held conflicting emotions.
Piketty is particularly sensitive to the lack of adequate data and record keeping which is essential to a fair and equitable tax system. Information on income and capital holdings must be made available automatically to the governments by banks and institutions and governments must freely share this information among themselves. Today there is a race to the bottom as countries compete with one another to offer lower tax rates on income and inheritance and some aggressively hide wealth held in their territories. Without a court order with proof of fraud or other illegality, Swiss banks will not release information on individual accounts held in Switzerland. Without the account information governments are hard pressed to bring evidence of illegality. There are many such places in the world. Too much of the world’s individual and institutional wealth is hidden in secret shelters which creates problems for researchers and governments alike. Piketty thinks it makes more sense to base taxes on the location of the wealth and income rather than the residence of the individual. Piketty notes with envy that larger economies like the US and China have an easier time setting and enforcing tax policy than the smaller European countries. He talks at some length about the Euro-zone. A central bank for the Euro was created but with little thought to its actual role and function. Piketty holds little hope for the Euro-zone unless a corresponding legislative body with real authority can be established.

wealth inequality

Piketty finishes with a discussion of economists’ treatment of the climate change crisis which is widely viewed as the next huge and looming economic catastrophe. Economists are arguing about the proper discount rate to apply to this catastrophe while the world’s governments seem unable to come up with any meaningful plans of action.
One of Piketty’s big contributions to the discussion of wealth and income inequality is his insistence that you cannot just look at the top 10% or even the top 1% but you must continue down to the .1% the .01% etc because of the extreme concentrations of wealth. He notes that inherited wealth is still dominant but that with the recent extreme inequalities in income and high savings rates of top earners it is now possible to build sizable fortunes within one’s lifetime. Piketty can find no rational economic justification for the extreme new top salaries but governments, unlike the war years when there were salary boards, does nothing to control runaway salary levels.
Despite all the evidence to the contrary, Piketty is optimistic that an international democratic consensus can be achieved with increased wealth and income transparency and reporting and with sensible tax policies that can slowly control and correct for income and wealth inequality.

Cuba and the end of Apartheid

Saturday, June 7th, 2014

Visions of Freedom, Havana, Washington, Pretoria and the struggle for Southern Africa, 1976-1991, Piero Gleijeses, 2013

This is a well researched history of Cuba’s involvement in Angola and the role of Cuba in the ending of South Africa’a apartheid rule. There has been so much distorted and wrong history of these events that Gleijeses felt compelled to spend years amassing documents and interviewing principals to tell the real story as best he can determine it.

Angola Founding Father Sam Nujoma Sam Nujoma

It begins with South Africa’s invasion of communist Angola in 1975 which led Cuba to send troops to Angola where they successfully drove the South Africans out of the country. The Cuban military was to remain in Angola until 1988 when they left as part of a four party settlement agreement between Cuba, Angola, South Africa, and the United States.

Namibian SWAPO slogans swapo

South Africa again attacked and destroyed a Namibian refugee camp at Cassinga in Angola. International outrage led ultimately to UN Resolution 435 which called for free elections in Namibia which South Africa occupied militarily and ruled through a puppet government. South Africa signed the resolution but knew it would lose a free election to SWAPO so refused to implement 435 til forced to do so in 1988.

Angola had its own civil war with the communist MPLA government fighting insurgent Jonas Savimbi’s UNITA. South Africa supported anti communist Savimbi militarily and economically. When Reagan became president, the US also began support of Savimbi. Savimbi spoke good English, was charismatic, and knew how to exploit anti communist sentiment. He had collaborated with Portugal in the colonial struggles and was a brutal and cruel terrorist. The Cubans made clear throughout their stay in Angola that they were there to stop South African incursions, not to help the government in its civil war.

UNITA Jonas Savimbi Jonas_Savimbi

The Soviets took a different view and helped plan and arm major MPLA offensives to destroy UNITA. The Soviets had no understanding of guerrilla warfare and wrongly believed that South Africa would stay out of their offensives. The first offensive was in 1985 and the MPLA lost about half its forces to South African artillery and air strikes. South Africa allowed the MPLA to retreat. The second disastrous attack was in 1987 and again MPLA lost many soldiers. This time South Africa pursued the MPLA with the intention of eliminating them altogether.

Cuba opposed both Soviet planned attacks but felt obligated to save the MPLA from South Africa. The counter offensive was planned by Fidel Castro himself in close consultation with his generals. Castro sent his best troops, MIG fighters, artillery and tanks and the latest Soviet anti aircraft weapons to Angola. This left him exposed at home but Gorbachev promised to send more weapons to Cuba.

Military Strategist Fidel in Angola castro angola

South Africa attempted to capture Cuito Cuanavale and the Cubans engaged them there. For the first time Cuba had air superiority and they prevailed. This time, Castro was determined to drive the South Africans out of Angola and developed a slow, careful, methodical campaign to achieve this objective. Reagan had set as his top priority in Africa to get the Cuban troops out of Angola. His diplomats, led by Chester Crocker, worked tirelessly trying to get the MPLA government to negotiate an agreement that would remove the Cubans but the Cubans were always excluded from these talks.

Reagan Crocker Discuss Angola crocker reagan

Once it was clear the Cubans were prevailing against the South Africans, American diplomats agreed to add Cuba to the negotiations. Cuba insisted that South Africa be added to the negotiations as well. Cuba had two non negotiable requirements; South Africa must implement UN Resolution 435 allowing free elections in Namibia; and South Africa must stop supporting Savimbi. After much posturing and bumbling, South Africa had to agree to the two conditions and to leave Angola. Cuba was in a position, not only to force South Africa out of Angola, but to attack South African bases in Namibia. Cuba agreed to leave Angola as part of the settlement in 1988. Free elections were held in Namibia and were won by SWAPO as expected. Free elections were also held in Angola and were won by MPLA. Savimbi refused to accept the results and US assistance was finally cut off for UNITA.

Fidel and Nelson castro mandela

Pretoria Freedom Park Monument freedom-park

Had these events happened only a year later when the Soviet system collapsed, Cuba would have been unable to force the removal of South Africa from Angola and force free elections in Angola and Namibia. Apartheid might still have ended under the pressure of an international boycott and sanctions but who knows if and when this would have happened. When Nelson Mandela visited Fidel Castro in 1991 he acknowledged that Cuba was centrally responsible for the fall of Apartheid in South Africa. The names of the 2000 Cubans who died in Angola are enshrined alongside those of the ANC on a monument in Pretoria’s Freedom Park South Africa today.

Rise of the President as Assassin

Friday, June 14th, 2013

The Way of the Knife, The CIA, A Secret Army, and a War at the ends of the Earth, Mark Mazzeti, 2013

Dirty Wars, the World is a Battlefield, Jeremy Scahill, 2013

Or How the ChickenHawks Dick Cheney and Donald Rumsfeld institutionalized Presidential Assassinations

The political term Chickenhawk is defined in Wikipedia as:

Chickenhawk (also chicken hawk and chicken-hawk) is a political term used in the United States to describe a person who strongly supports war or other military action (i.e., a War Hawk), yet who actively avoided military service when of age.

The term indicates that the person in question is hypocritical for personally dodging a draft or otherwise shirking their duty to their country during a time of armed conflict while advocating that others do so. Generally, the implication is that chickenhawks lack the moral character to ask others to support, fight and perhaps die in an armed conflict. Those who avoid military service and continue to oppose armed aggression are not chickenhawks.

Chickenhawks 1980 and 2000

These two books explore how Dick Cheney and Donald Rumsfeld , hereinafter referred to as CR, transformed the elite special forces (Navy Seals, Delta Forces, and Army Rangers) into the ultra secretive JSOC command, reporting directly to the President with a worldwide license to kill. CR largely insulated W from their decisions under the guise of denyability.

Prior to CR under W, these special forces were primarily famous for two disastrous actions, the aborted 1980 attempt to rescue the Iran hostages under Carter and the even more disastrous 1993 Black Hawk Down incident in Mogadishu Somalia under Clinton. The only group with a more disastrous history than the special forces was the CIA who Congress outlawed from initiating assassinations after the revelations of the Frank Church hearings in 1975. For more on CIA incompetence see Secrets in an Open Society.

A more minor enabling player in these books is the FBI with their proclivities to entrap innocent victims in their notorious sting operations. Two US citizen victims of drone assassinations were driven by previous FBI sting operations, Imam Anwar Awlaki was killed in September 2011 and Buffalo citizen Ahmed Hijazi (Kamal Derwish) was killed in November 2002 along with the alleged mastermind of the USS Cole attack, Abu Ali al Harithi. Awlaki was arrested twice in San Diego when FBI prostitute undercover agents approached him unsolicited. Hijazi was accused of being one of the Buffalo NY “Lackawanna Six” after his assassination. The FBI stings were instrumental in encouraging both men to leave their US homes for Yemen where they were assassinated. For more on FBI methods see Paranoid Ideologues.

The central theme of both books is how American policy in Afghanistan, Iraq, Yemen, Somalia, Pakistan, and elsewhere has actually led to an increase in American insecurity and how policy makers refused to see how their policies were counterproductive. In each case, America either invaded directly to destroy an existing regime, or had proxies (Christian Ethiopians invading Islamic Somalia) destroy the existing regime or undermined the regimes by totally disregarding the country’s sovereignty (Yemen and Pakistan). America always chose the wrong people to form new regimes and these US backed regimes always led to an increased presence of enemies of the US in the countries. For example, al Shabab, a Taliban like group in Somalia, has gone from a nonentity to a major force controlling more and more of Somalia. Unless American soldiers stay in Afghanistan, the Taliban will likely retake control of the country. Our good ally Pakistan likely welcomes this outcome. This universally disastrous foreign policy has cost hundreds of thousands of innocent lives and trillions of US taxpayer dollars. Enemies of the US have multiplied many fold. Yet none of these enemies pose an existential threat to the US, unlike the Soviet Union during the cold war. The disastrous policy of “war on terror” and “the world is a battlefield” is designed to continue forever.

Stanley McChrystal with Obama

CR authorized a secret JSOC facility camp in Iraq, NAMA under McChrystal, where JSOC personnel both captured and “interrogated” prisoners. NAMA was far worse than Abu Ghraib yet Americans were never told about it and its abuses. Tortured prisoners will say whatever the torturers want to hear, in this case WMD and al Queda. That the confessions were untrue didn’t matter to true ideologues CR. When a major insurgency erupted, CR kept insisting it was just a few “dead enders” from the Hussein Baathist era. De-Baathification had created hundreds of thousands of unemployed, trained soldiers, with unlimited weapons. There were plenty of groups willing to exploit these soldiers for their own purposes. A Jordanian terrorist claiming to be associated with al Queda, and working in Iraq, Zarqawi, started chopping off heads, giving CR “evidence” that Hussein had harbored terrorists. The evidence was that Zarqawi had traveled to Iraq for medical treatment once prior to the American invasion. Hussein probably never heard of Zarqawi.

Obama and Brennen Terror Tuesdays

Obama, upon taking office and to everyone’s surprise, kept W’s security team of Petraeus, McChrystal, McRaven, Gates, and Brennen. Early in Obama’s administration, Somali pirates mistakenly boarded an American flagship. They quickly realized their mistake and attempted to escape, taking the captain hostage. A battleship was ordered to the scene. Obama was informed that the planet’s best snipers (the JSOC ninjas) were only 45 minutes away from the battleship. Obama ordered them to the scene and when they reported they had clear shots at the pirates, Obama gave the order to kill. Three shots, three dead Somali pirates. Obama loved it and invited the ninjas involved (members of Navy Seal Team 6) to the White House. Thus was born the era of Obama as assassin in Chief.

Who snatched Leon Panetta’s Body?

Obama had appointed trusted ally Leon Panetta to head the CIA and under Obama the JSOC and CIA were to form a closer working relationship in their “targeted killing” program. This program has been expanded from the W era and has been largely successful in assassinating people on the kill lists although with countless innocent victims. Obama and Panetta announced the closing of the black sites (secret prisons), the end of torture interrogations, and the end of renditions, and then secretly continued all three.

The books recount discussions about the best way to kill a target, with an M16 or a drone strike. The drone strike is seen as more antiseptic but more difficult to confirm the kill. Occasionally, CIA operatives have been sent to strike sites to collect DNA samples and other evidence, but the strikes make such a mess that identification is difficult. Maybe the Ninjas should bring back the head after a kill. The reader is reminded of scenes from the movie “GoodFellas” and discussions among its psychotic characters. Kill or capture? If you capture you need a prison and you are expected to interrogate. Do you hold indefinitely or are you forced to try the “detainee“? Better to just kill the target and be done with it.

Obama condemns US citizen to death without due process >
Anwar’s 16 year old son Abdulrahman also killed by US drone

In the case of Anwar Awlaki, the intelligence community seems to have concluded that his speeches and blogs were protected free speech and they never got evidence, despite Obama’s false statements, that Awlaki was associated with al Queda or ever assisted any terrorist. This conclusion also included analysis of emails between Awlaki and Nidal Hasan the American soldier that killed 13 at Fort Hood Texas. Awlaki posted a blog after the killings supporting Hasan’s actions which may have been the breaking point for Obama. Awlaki was killed simply to silence him. Nothing more. two weeks later a US drone strike “accidentally” killed Awlaki’s son Abdulrahman. Obama press secretary Robert Gibbs comment: “Well I would suggest that he should have a more responsible father.” Unbelievable.

Petraeus sells Obama on Afghan “surge”

When McChrystal was put in charge of the Afghanistan “surge” other military commanders expected the worst and got it. McChrystal reproduced his Iraq operation on steroids. JSOC operators multiplied, black ops prisons like NAMA were created, and targeted killings skyrocketed. Like Iraq, there were virtually no al Queda operating inside Afghanistan. The targets this time were mid level Taliban but the ninjas couldn’t even tell the tribes apart, so the killing of innocents and allies multiplied. Hatred of Americans and sympathy if not support for the Taliban increased. One mistaken raid killed Daoud, an American trained regional head of intelligence, and members of his family. Realizing their mistake, the JSOC team refused to call medical assistance and starting digging their bullets out of the victims body while some were still alive. They died. The team was only able to recover only 17 of the 21 rounds fired in the raid. A dogged British journalist, Jerome Starkey, exposed the coverup and witnessed a scene where a fatigue wearing soldier with the name tag McRaven enacts a ritualistic sheep sacrifice in front of the family by way of apology. Starkey didn’t even know who McRaven was at the time. Another example of foreign policy gone terribly wrong.

Raymond Davis contractor with license to kill

Secret Wars is organized chronologically, jumping from Iraq to Afghanistan to Yemen to Somalia with Awlaki’s story threaded throughout. Toward the end, we finally get to Pakistan where things get really strange. Remember that the CIA and Pakistan’s ISI worked closely through the 1980′s to support the Afghan Mujahedin (see Ghost Wars) in their fight against the Soviet occupation and that Pakistan is a nuclear power. In January 2011 American Raymond Davis killed two Pakistanis at a busy intersection in Lahore. Davis’ rented Honda Civic was carrying enough arsenal to hold off a small army in addition to GPS, satellite communications, night vision equipment, multiple ids and cell phones, ATM cards, makeup and disguises and other trade craft. He would have made James Bond envious. The killed Pakistanis were ISI operatives who were following Davis and he shot them both through the windshield as only a trained assassin would have been able to do. He was in possession of sensitive photos of secret Pakistani military facilities including nuclear storage facilities. His cell phones showed he had made calls to both Tehrik-e-Taliban and Lahkar-e-Jhangvi Pakistani terror groups. Who was Davis working for? Was it the CIA, JSOC or someone we haven’t heard of? People at his obvious level of experience have level after level of cover stor. He was released after admission that he worked for the CIA but the reality is probably deeper. What was he doing at the secret military sites? It seems that the US government has secret plans to secure (i.e. steal) Pakistan’s nuclear arsenal in the event of a coup or other instability inside Pakistan. How wild is that? Why was he calling Pakistani terror groups?

Davis called for backup, calmly photographed the two Pakistani’s he killed, and fled the scene in his Honda. A backup Land Cruiser with false license plates rushed to assist Davis but ran over a motorcycle killing its driver. The Land Cruiser fled but Davis’ Honda was stopped by police two miles from the murders. ISI sent special forces to guard his prison cell and prevent a JSOC style rescue. Had Davis been put with the general prison population he would probably have had his throat slit. The backup team returned to the CIA-JSOC safe house, destroyed all their documents and equipment, and fled to the US Consulate where they were evacuated from the country before Pakistani officials could question them. They have not been identified.

The CIA had followed a courier to Osama bin Laden’s safe house five months prior to the Davis incident and were awaiting confirmation that Osama was there and assassination plans were readied when the Davis incident happened. The US needed to get Davis out of Pakistan before they could initiate the assassination of bin Laden. Thus the negotiations with Pakistan and the ISI took on an urgency it would not have otherwise had. Then the wife of one of the ISI murder victims committed suicide leaving a video statement blaming the US. Davis’s handlers apparently hid his true job from the white house and state department leading both to make embarrassing and false claims about Davis’s job. Afraid that Davis might start talking and needing to proceed with bin Laden’s assassination, top US military officials including Admiral Mullen and Petraeus met in Oman with their Pakistani counterparts in the military and ISI to hash out a solution. A very unusual Sharia court proceeding presented the families of the victims with $2.3 million and Davis was whisked out of the country on a CIA rendition plane.

William McRaven Mr. Cool

Six weeks later Osama bin Laden was assassinated in Abbottabad Pakistan. For bin Laden’s murder, the JSOC ninjas under CIA direction shot and killed bin Laden, brought the entire body to a ship, and buried it at sea. It was not deemed necessary to share confirmation with the American people. Before the mission the team discussed not shooting bin Laden in the head since the reason for sending a team on a dangerous mission 150 miles inside sovereign Pakistan to a house a mile away from a military academy was to confirm the kill.

Matt Bissonnette Seal Team 6 Member

The first team member to encounter a tall man in the house shot him three times in the head. The next team member shot the body multiple times in the chest. Matt Bissonnette’s job was to collect DNA samples (they had DNA from bin Laden’s sister) and when he cleaned off the face he was surprised how young the man was and that his beard was completely black. Bissonnette had surely seen every photo and video of bin Laden in existence yet he didn’t recognize the man in person. Bissonnette remembers thinking at the time that the American people don’t need to see this (the messed up face and head). Even if this is the reason photos were not released there is no security reason why the DNA test results should not have released to the public. Guns were found in the house but none were loaded. Anyone there could have been captured without a fight but the mission was assassination. Four men and one woman were killed in the raid. Others, including children, were injured. Immediately after the raid Brennan said that the team had been in a firefight (false) and that bin Laden had used women as a shield (false). The Obama administration said just trust us then lied about so many aspects of the mission that Bissonnette felt compelled to write his own account No Easy Day. He would not have been privy to the DNA test results. We should trust them that the DNA test results were a match?

Michael Furlong Michele Ballarin

The Way of the Knife includes a couple of characters (for comic relief?). Michael Furlong was an overweight long time government and military person who spoke in fast government-military speak that seemed to bedazzle whoever he met. He ran an operation where spyware was hidden in a cell phone game with information gathered and stored in an illegal database in the Czech Republic. Furlong showed up in Prague during sensitive negotiations over deploying a US missile defense system in the Czech Republic and US government officials had him thrown out the the country.
Michele Ballarin was a wealthy West Virginia Republican socialite who raised Lippizaner horses. She somehow inserted herself into Somali pirate ransom negotiations and pirates on one seized ship raised a sign asking specifically for her. She proposed setting up a food program for refugees in Somalia where she would collect intelligence about everyone who came to get aid that she could feed to US intelligence. The program was not approved.

Blackwater’s Eric Prince appears in both books with activities no less bizarre but certainly not comic. Prince is drawn to unsavory characters around the world like a magnet. He outfitted his own small ship with an incredible arsenal, helicopter, and small speed boats, and offered to escort ships through the Somali pirate area of operations for $200,000 a trip. This was his sanest venture. He lives in Abu Dhabi to be close to the action and avoid taxes.

Netizens Unite

Tuesday, April 10th, 2012

Consent of the Networked; The Worldwide Struggle for Internet Freedom, Rebecca MacKinnon, 2012

WWW and HTML Inventor Sir Tim Berners Lee

The Internet was a product of the open source movement and remains at its core self governing. Most Internet servers run open source Linux and operate using open source Apache. A significant portion of browsers are Mozilla open source Firefox and emails are handled by Mozilla open source Thunderbird. Open source WordPress is acknowledged here as a critical source for bloggers including this one. Wikipedia, a non profit, all volunteer organization has created a reliable source of information on just about any subject that would not have been possible by any private company or government anywhere in the world. This book is about threats to these remarkable achievements posed by corporations and governments and wrestles with the problem of keeping the Internet safe and free. The issues are by no means simple.

Wikipedia’s Jimmy Wales

Focusing particularly on Google and Facebook, MacKinnon likens living under their control and rules as a bit like living under King John in England at the time of the Magna Carta. The king is all powerful and can do anything he wants at any time for any reason. His subjects can only hope for the king’s benevolence. Unfortunately, the king(s) of the Corporate Internet live in Silicon Valley and have very limited life experiences. They are pretty clueless when it comes to imaging the consequences of their Internet policy actions on users, particularly very vulnerable users in Tunisia, Iran, China, and other autocratic places. MacKinnon particularly points out the king(s) attitudes and policies regarding anonymous accounts which they view as an invitation to bad net behavior. They don’t understand that anonymity may be the only way for some to participate in the online world without risking arrest, torture, or death. Yet both Facebook and Google Plus require real world identification (which they do not protect) meaning that dissidents around the world can use these tools only by creating fake identifications and hoping their accounts don’t get removed by the kings. Attempts to create open source social networking software have not been successful because of the dominance of Facebook and Google. Social networkers must go where the users are; they can’t on their own start a whole new country. Facebook is so arbitrary in their policies and constantly change things including the rules of disclosure without warning, notice, or user option. She calls them Facebookistan.

Czar Mark Zuckerberg of Facebookistan

She also highlights problems when Internet companies attempt to do business with autocratic governments and she focuses on China where she worked for years as a CNN reporter. Yahoo set up an in country division to run their services including email. The Chinese government forced the in country Yahoo to hand over dissident emails and several users were arrested, prosecuted, and given long jail sentences. Jerry Yang later apologized, paid reparations to the families, and changed Yahoo policies, but too late to prevent the damage. Google’s struggles to operate in China under the government censorship finally led them to leave China for Hong Kong where they are outside the Great China Firewall.

Regretful Jerry Yang

The threat of US legislation to protect users from arbitrary corporate rule led to the formation of the Global Network Initiative which was joined by Yahoo, Microsoft, and Google. Facebook has repeatedly declined to join. The purpose of the Initiative is to protect user privacy and freedom of expression around the world. But how do the corporate members protect their users in the face of government intervention and rules? Even the US government poses increased threats to privacy.

Director MacKinnon Global Network Initiative

Users through a broad coalition of user groups introduced a Charter of Human Rights and Principles in 2011. Here are their 10 Internet Rights and Principles;

1) Universality and Equality
All humans are born free and equal in dignity and rights, which must be respected, protected, and fulfilled in the online environment.
2) Rights and Social Justice
The Internet is a space for the promotion, protection and fulfilment of human rights and the advancement of social justice. Everyone has the duty to respect the human rights of all others in the online environment.
3) Accessibility
Everyone has an equal right to access and use a secure and open Internet.
4) Expression and Association
Everyone has the right to seek, receive, and impart information freely on the Internet without censorship or other interference. Everyone also has the right to associate freely through and on the Internet, for social, political, cultural or other purposes.
5) Privacy and Data Protection
Everyone has the right to privacy online. This includes freedom from surveillance, the right to use encryption, and the right to online anonymity. Everyone also has the right to data protection, including control over personal data collection, retention, processing, disposal and disclosure.
6) Life, Liberty and Security
The rights to life, liberty, and security must be respected, protected and fulfilled online. These rights must not be infringed upon, or used to infringe other rights, in the online environment.
7) Diversity
Cultural and linguistic diversity on the Internet must be promoted, and technical and policy innovation should be encouraged to facilitate plurality of expression.
8 ) Network Equality
Everyone shall have universal and open access to the Internet’s content, free from discriminatory prioritisation, filtering or traffic control on commercial, political or other grounds.
9) Standards and Regulation
The Internet’s architecture, communication systems, and document and data formats shall be based on open standards that ensure complete interoperability, inclusion and equal opportunity for all.
10) Governance
Human rights and social justice must form the legal and normative foundations upon which the Internet operates and is governed. This shall happen in a transparent and multilateral manner, based on principles of openness, inclusive participation and accountability.

MacKinnon includes a chapter on the “copy wars”, the attempts to shut down Internet sites accused of Intellectual Property copyright violations without due process. Youtube, Flickr routinely remove content at the simple request of supposed copyright holders or even governments without warning or notice to the posters. Flickr removed photos of Egyptian government torturers simply at the request of the Egyptian government. No proof of ownership or copyright violations need be proven and no procedures of law need be followed. This is consistently abused by both corporations and governments as they attempt to control or censor content. Lawrence Lessing founded a non profit group the Creative Commons to allow people to control the sharing of information as an alternative to old style outmoded copyright law. The CC, used by Wikipedia and others, means content is free to be copied subject only to acknowledging the source and accurately reproducing the content. There are no monetary or legal trapdoors.

Creative Commons Lessig

MacKinnon also discusses user attempts to engineer around government Internet and other communications shutdowns during times of crisis. We think of China, Egypt, Tunisia, Syria and others, but MacKinnon reminds us that San Francisco’s BART shut down mobile communications during demonstrations protesting the shooting of a citizen by BART security forces in 2011. BART officers killed another man in Oakland in 2009. Attention must be given to the political locations of servers and to alternative communications access means. Egypt used conventional dial access via international calls during their revolution and satellite calls are also accessible. Open source developers are working on decentralized dynamic networks that can reconfigure themselves to maintain network access during government shutdowns or attacks.

An important book that should be read by all Netizens.

The Steel Factory

Monday, January 30th, 2012

Deng Xiaoping and the Transformation of China, Ezra F. Vogel, 2011

Three Stampers

A thorough (800 pages) account of the life and impact of Deng on the modernization of China. Deng’s history including his years in France, where he first met Zhou Enlai and Ho Chi Min, and Russia, his roles in the war against Japan and the Civil War against the Guomindang and the early years of the Communist rule of China up to the Cultural Revolution are covered in only 45 pages. The tale really begins in 1967, when Deng, age 63, is placed under house arrest. In 1969 with the plane crash that killed Lin Biao and the first Soviet incursions into Outer Mongolia, Mao has Deng sent to Jiangi province where he was given light factory work in an army controlled facility. He would not be recalled to Beijing until 1974, when Zhou Enlai had again fallen from Mao’s grace and was dying of cancer and Mao himself was fast failing from Lou Gerhig’s disease. After some success in restoring order to the railroads and key provinces, Deng again is attacked by Mao starting in 1975. Zhou Enlai dies in early 1976 and Mao attempts a quiet ceremony only to see Beijing and Tiananmen overrun with spontaneous mourners. On April 5 1976 a massive demonstration is held in Tiananmen Square for Zhou and Deng. Jiang Qing (Mao’s separated wife) and the Gang of Four (so named by Mao) set out to quell the demonstration and continue the criticism of Deng. Hua Guofeng is named Mao’s successor and Mao dies on September 9, 1976. Hua immediately moves to arrest the Gang of Four who are tried and executed for their role in the Cultural Revolution and the purge following the April 5 demonstration. Deng immediately consolidates his power in the military and foreign affairs and quietly sets out to remove Hua. Deng never assumes the titles of leadership and never creates a cult of personality around himself.

The “Four Modernizations” to develop agriculture, industry, national defense, science and technology was formalized by Zhou Enlai in 1963 and underpinned the policies of Deng after 1977. Mao had believed in the need for continuous revolution which resulted in the chaos and tragedies that were the Great Leap Forward and the Cultural Revolution. Mao engaged in perpetual war against the landlords and capitalists. But Mao also attacked the intellectuals and educated Chinese and Deng led in the purges of the Hundred Flowers campaign starting in 1957. By 1977, Deng had come to realize that China would need an educated class to promote education, research, and modernization. Chinese universities had been largely destroyed during the Cultural Revolution, were occupied by the army, and were operating at a secondary school level. Deng moved to normalize relations with the US with a primary goal to send large numbers of Chinese students to US universities. He reformed the Universities to qualify students for admission to foreign Universities. Deng explained that working with your mind was the same as working with your hands and all work should be honored. Asked if Deng wasn’t worried that the students would stay abroad, Deng responded that it didn’t matter because they were still Chinese and would help China wherever they chose to live and work. As it turned out sizable numbers of students did return to China where they played key roles in China’s transformation.

Shenzhen old and new

Deng was famous for his memorable quotes “It doesn’t matter if a cat is black or white, so long as it catches mice.” and “When you open the door, flies will get in.” to explain his openness to economic and market experimentation and willingness to tolerate some corruption if economic progress results. The usual focus is on China’s development of the Special Economic Zones (SEZs) led by Shenzhen near Hong Kong which grew from a sleepy village of 20,000 to a metropolis of several million with tall modern buildings and all infrastructure needed to support modern manufacturing. But equally important to the transformation of China were allowing certain regions to move from collective farming to household farming resulting in huge increases in food production and the promotion of small enterprises at the collective and household level to produce and market products wanted and needed by the people Household farming and small scale enterprise came to produce half of China’s GNP.

Particularly interesting were Vogel’s reasons why China developed so differently from the Soviet Union and Eastern Europe. He points out the China had a long history as a culturally unified area dominated by the Han people. The entire country had a single written language and Mandarin was long the official government spoken language. Mao simplified the written language and made sure all Chinese were taught Mandarin and simplified Chinese writing. Second, China has a long coastline and many deep water seaports unlike the other Communist countries. This advantage makes it far easier to import technology and export products. Transportation in the interior of China was limited but the coastal cities were not held back by this limitation. Third, China had the examples of Singapore, Hong Kong, Taiwan, South Korea, (the dragons) and Japan to study and emulate. Finally, many millions of Chinese were living overseas throughout the developed world. China found these overseas Chinese very ready to assist in the modernization process. Deng was advised by Singapore’s Lee Kuan Yew and Hong Kong shipping magnate Y K Pao and several Chinese American Nobel laureates.

old steel and new

The largest foreign investor in China was Japan. Vogel points out that the eye opening trips made by Chinese leaders to Japan and Western countries in the late 1970s resembled the Iwakura Mission of 1871 in Meiji Japan. Like Japan, these trips served to show the Chinese how far behind they were. This was brought home most tellingly when Deng visited an automated continuous production steel plant in Japan whose production was almost the equivalent of all China’s antique plants combined. With Japan’s technical, financial, and management assistance, China today produces more steel than the US and Japan combined. Deng was equally interested in how Japan had converted from a war production economy during the war to a peacetime, consumer economy so quickly after the war ended.

Deng began his rule with two bold moves. He authorized a lightning strike military invasion of Vietnam to demonstrate that China could threaten Hanoi anytime it chose. Troops took control of all northern county capitals then withdrew to China in only 28 days. Deng calculated that this surprise move would stall Vietnam’s aggressions in Laos and Cambodia and to warn the Soviets to stay away from the southern region, would secure China for at least a decade, giving him time and space to implement his economic reforms. Second, Deng moved immediately to normalize relations with the US so that the Soviets would be detained from aggression, Chinese students could begin study in US universities to close the training gap, and the US could be encouraged to invest in China. Central in Deng’s mind was US education of China’s best students.

Vogel spends a lot of time discussing the Tiananmen Square student uprising of 1989. Deng started his leadership by normalizing relations with the US and wanted to bookmark his regime with normalized relations with the Soviet Union. Gorbachev visited Beijing in late May 1989 to finalize the normalization agreement. Hu Yaobang, as General Secretary was a reformer promoting freedom and democracy much beloved by Chinese university students. Hu was removed from office and criticized for his failure to deal with student demonstrations in 1986. When he died in 1989, the students came to Tiananmen Square to honor Hu much like the earlier mourning demonstrations in honor of Zhou. Hu replaced Zhou in the hearts of the students. Deng desperately wanted to clear the square by the time Gorbachev arrived. He wrote a tough editorial which only strengthened the resolve of the demonstrators. Days before Gorbachev and massive worldwide media arrived in Beijing the students started a hunger strike. Western press which came to cover the Gorbachev visit quickly turned their focus to the demonstrators. Deng tried to clear the square with unarmed soldiers but failed. He waited for Gorbachev and the Western press to leave then sent in heavily armed troops with orders to clear the square at any cost. Estimates of student deaths vary from 400 to several thousand. Zhao Ziyang was removed from power for disagreeing with Deng’s handling of the demonstration.

Factions remained under Deng with the reformers on the right and the conservatives led by Chen Yun on the left. The early success of creating a market economy in China resulted in double digit GNP growth for a number of years in succession. By the late 1980′s the massive growth led to inflation anticipated to be 30% in 1989. Inflation was particularly hard on the mass of Chinese living with fixed incomes. Chen and the conservatives blamed the Tiananmen demonstrations on this inflation and moved too aggressively to contain it bringing the Chinese economy to a hard landing with growth under 4%. The conservatives remained in control until 1992 until Deng, then 87 years old initiated one final movement during his winter vacation in the south. During visits in Shenzhen, Zhuhai, Guangzhou, and Shanghai, Deng spoke out colorfully and strongly for liberalization and expansion of his socialist market economy. Hong Kong media quickly picked up on Deng’s tour and began broadcasting coverage of his talked via television which was now widely available in the regions near Hong Kong. Popular support for his views exploded and his hand picked successor Jiang Zemin quickly changed sides from the Chen led conservatives to the Deng led reformers. In his last movement, Deng thus set the stage for the resumption of the fast growth that continues to this day. From this time forward, inflation fighting measure assured that the economy would have a soft landing and rapid growth continue.

the Steel Factory melts the Iron Lady

The British handover of Hong Kong took place in 1997 just months after Deng’s death. Preparations for the handover occupied a central part of Deng’s attention during his rule. He knew that Hong Kong would be invaluable as a financial and trade center as it had since the revolution in 1949. Deng consistency pressed the one country – two systems approach to dealing with Hong Kong. He continued to develop personal relationships with key Hong Kong businessmen and made sure that the right people from China were appointed to Hong Kong and that Hong Kong leaders were developed to be able to take over when the British administrators left. One of Vogel’s better stories is the visit of Margaret Thatcher (the Iron Lady) to Deng (the Steel Factory) in September 1982. Thatcher was riding high after her victory in the Falken Islands and intended to tell Deng that Britain had decided to keep administering Hong Kong indefinitely. Deng changed her mind for once and all. China would administer Hong Kong and warned Britain not to attempt to drain assets from Hong Kong prior to the handover.

China’s efforts to reassure the residents of Hong Kong received a big setback after the Tiananmen Square repressions and individual residents continued to leave Hong Kong for Canada and other destinations taking as much wealth with them as possible. For all the drama, the handover went smoothly and Hong Kong continues its role today as financial center and trading center for China and Hong Kong’s residents continue to prosper.

Modern Shanghai Bund

What about Shanghai, China’s largest manufacturing center when Deng took over? Shanghai was initially excluded from the SEZ creations because of its size and complexity and because Deng was worried that the SEZs would be seen as a recreation of the colonial past with the foreign concessions. Shanghai was allowed to modernize later and Deng’s successor Jiang Zemin made his reputation in Shanghai.

It is difficult for those in China an abroad who became adults after Deng stepped down to realize the enormity of the problems Deng faced as he began this journey; a country closed to fundamentally new ways of thinking; deep rifts between those who had been attacked during the Cultural Revolution and their attackers; proud military leaders who were resistant to downsizing and budget reductions; public animosity toward imperialists and foreign capitalists; an entrenched conservative socialist structure in both the countryside and the cities; a reluctance by urban residence to accept over 200 million migrants from the countryside; and dissension as some people continued to live in poverty while others became rich…It is doubtful that anyone else had the combination of authority, depth and breadth of experience, strategic sense, assurance, personal relationships, and political judgement needed to manage China’s transformation with comparable success.

Four Generations

Another reason to study this work is for the insights it gives into the inner workings of the political system, the campaigns, the training and promotion of leaders, the complex intrigues between ruling cliques. Deng watched events unfold as labor unions struck in Poland, Nicolai Ceausescu was overthrown in Romania, and as Gorbachev set out to reform the communist party only to see the collapse of the entire Soviet system. Deng was determined to keep a strong single communist party with adherence to the thought of Lenin, Marx, and Mao (with Deng as the high priest of interpretation). At the same time he believed that leaders should experiment, make mistakes, admit their mistakes, correct their mistakes, and experiment again. He carefully avoided the Kruschev mistake of critizing Stalin, finding quotes from Mao that he was correct 70% of time, in other words Mao made mistakes such as the Great Leap Forward and the Cultural Revolution, for which Mao accepted responsibility (he did?), corrected, and moved on to new experiments.

Deng believed that training leaders, giving them freedom to experiment, judging the results (did the cat catch mice? were the flies tolerable?), correcting mistakes, including changing leaders if necessary is the key role of the communist party leadership. Deng believed that reform and economic transformation could only be accomplished by the selection of the proper leadership at the national and regional levels. Deng and his cohort were the second and last generation to have experienced the wars as leaders. Deng was determined to force his cohort of old revolutionaries to retire with him and to pass the reigns to a much younger generation of leaders who grew up in very different conditions. We have now seem several and are about to see the next changing of the guard as the next generation assumes power in a peaceful transfer. All this is the rightful legacy of Deng.

Patent Follies

Wednesday, November 30th, 2011

Deadly Monopolies, Harriet A. Washington,2011

Washington is a medical ethicist and bioethicist whose attitude seems to be summed up in this quote from Thomas Browne;
“No one should approach the temple of science with the soul of a money changer.”


The Real Henrietta Lacks, unsung hero of Polio vaccine

Who owns our bodies? Apparently not us judging from consistent court rulings. In 1951 tumor cells were extracted without consent from cancer patient Henrietta Lacks for further study. These cells, known as Hela were propagated and sold over and over and are still available for research today. They have generated millions of dollars in fees and have underpinned research breakthroughs and treatments too numerous to mention although their contribution to the development of Salk’s polio vaccine stands out for special mention. Henrietta’s husband had refused to consent to the cell extraction and the family only learned that the Hela line was world famous in 1994 when a son was approached to provide his cells for additional study.


Alistair Cooke’s Body Snatched

Appropriation of body parts without permission continues unabated and is a huge business worth billions today. Among those appropriated without permission were Alistair Cooke, long time host of PBS’ Masterpiece Theater. Some of these bodies including children have found themselves used in auto manufacturers crash tests.


Burroughs Ginsberg writings overturned plant patent

Then in 1980 the Bayh-Dole act was passed to allow the commercialization of patents resulting from government sponsored research. In that same year, 1980, the supreme court ruled that life can be patented leading to a gold rush of patents in plant and animal life. Traditional remedies and medicines known for hundreds or even thousands of years have been patented. Few have been overturned by the courts. A 1980′s patent on a Brazilian psychedelic plant was overturned not because of the plant’s traditional and sacred meaning to a Brazilian tribe but to the 30 year prior writings of Alan Ginsburg and William S. Burroughs. Bio-colonialism is OK but prior documented western “discovery” can be used to invalidate a patent.

While the human genome project itself and its discoveries were placed in the public domain, subsequent work to isolate individual genes responsible for certain diseases were allowed to be patented. That’s right, Alzheimer’s, cancers, and many other deadly diseases are owned and controlled by patent holders. More than 50,000, almost a fifth of all human genes are now patented, more than 36,000 by a single French company, Genset. Many genes were allowed to be patented even though researchers don’t know the gene’s function. These genes patents more than any single cause have stymied, slowed down, or even blocked outright research into tests and treatments of many deadly diseases. At the very least they have dramatically increased the cost of doing research as huge patent licensing fees must be paid.

The pharmaceutical industry was once the most profitable industry ever to exist on the planet. It has now fallen to the third most profitable and profits are in free fall off the cliff. Why? Because drug companies no longer develop important life saving blockbuster drugs like the statins (Zocor is off patent and Lipitor’s patent is expiring), but put their efforts into “me too” drugs and life enhancing drugs like Viagra or cosmetics.

They also pour enormous efforts and resources into defending through litigation and extending their patents with such tricks as combining two drugs whose patents are expiring into a “new” patentable drug, or re-branding a drug for a new purpose such as patenting an existing drug under a new name with FDA approval for use by black people (whatever that means genetically) exclusively. Remember thalidomide the drug that caused all those birth defects back in the 1950s and 1960s. Guess what, thalidomide is back as a relabeled newly patented drug for the treatment of lepers.

It costs upward of $1 million to fight a patent infringement case involving drugs. To prevent “me too” drugs, companies file not only the drug they want to market, but every near derivative they can imagine. One drug patent was surrounded by 1300 similar drug patents to make “me too” drugs virtually impossible to produce. Adding to the mess, some drug patents are 400,000 pages long (not a typo) and the company requesting the patent pays most of the patent office costs. Sounds a lot like the relationship between the ratings agencies and the financial companies who pay them. Imagine litigating over a patent that no one can possibly read or understand.

What can happen once a patent is granted for a drug? One drug capable of eliminating sleeping sickness was never marketed for that purpose but was re-branded as a facial creme to remove women’s facial hair. Not enough money in sleeping sickness? Several effective cancer drugs were not marketed because of low projected revenues and the university inventors were unable to override the company decision. Those drugs sit on the shelf useless.

Available cancer drugs have been singularly disappointing resulting in an overall extension of average American lifespans a mere four months. Yet a single course of cancer drug treatment can cost $200,000 to $300,000 each. In one case, the Canadian health system, unable to reach an acceptable price agreement with the manufacturer, paid $218,000 for one Canadian patient to travel across the border for treatment in the US. We now learn that speculators often corner the market and horde these expensive drugs in order to hold doctors-patients-hospitals hostage for incredible additional markups. Oh the wonders of unfettered capitalism.

Unable to get American consents for drug studies, companies increasingly are testing drugs in Africa and Asia where they ignore consent requirements and feel free to use placebos where they would be required to use the best available treatments for their comparisons. That’s OK, their test subjects won’t be able to get the test drug anyway after the study ends. This is The Constant Gardener on steroids. See also The Body Hunters. And if the patients or their families sue with government help as in a case in Nigeria where 11 children died during a test and many other were disabled for life, the drug company “lost” all its records yet once a settlement was negotiated was able to identify its test subjects through DNA tests. Very mysterious record disappearance. The drug was never FDA approved fortunately.

But avoiding the need for consent is not limited to poor countries but is practiced domestically as well. One company had developed a blood hemoglobin substitute whose early tests showed up bad side effects. Needing another large clinical study to proceed the company came up with a novel idea. They kept supplies of the “blood” in EMT vehicles operating in whose areas contained mostly poor, primarily black and Hispanic populations. Whenever the EMT team picked up a patient who had lost blood they administered the artificial hemoglobin rather than the usual saline solution on the trip to the hospital. The company’s thin justification for avoiding the need for consent was that the subject was unconscious (sometimes), that no family members were present (sometimes) and that treatment was urgently required. (No, saline would have stabilized the subject til arrival at the hospital.) Once in the hospital, the company extracted blood samples three times a day for the study. If a subject asked why they were told it was a normal part of their treatment. In other words the subjects were never informed that they were in the study, of the known risks and side effects of their treatment, they were lied to throughout. The FDA did not approve the hemoglobin substitute.

For those that think the horrors of the Tuskegee syphilis experiments on black soldiers is ancient history, think again. After the military grade anthrax samples were mailed to important congressmen and newsrooms, a drug company rushed to develop a vaccine for anthrax. While the vaccine was in testing and after significant problems such as loss of vision and hearing and miscarriages had already surfaced, the DOD determined to vaccinate more than 100,000 troops with the non-FDA approved drug. Thousands of soldiers refused and were dishonorably discharged from service at great cost to themselves and the military. A pregnant soldier asked to be transferred but her commanding officer not only denied the transfer but forcibly had her vaccinated as an example. She miscarried. The FDA never approved the vaccination but the soldiers learned they had no legal recourse either against the military or the drug company. Today thousands of former soldiers suffer from the side effects.

Also on the subject of bio-colonialism, researchers are increasingly descending on isolated groups of people whose isolation give them a limited gene pool and therefore makes them useful for isolating particular disease’s genetic causes. Thus Easter Island, Hawaiians, a 2000 year old group of Jews in India are recruited for studies for which they are unlikely to benefit. An interesting example is Iceland where an Icelandic researcher formed his own company and set out to collect samples and information promising financial rewards and medical breakthroughs beneficial to Icelanders. Icelanders love genealogy and can track their ancestry often back to a Viking. They also keep extensive medical records tracing back for generations. Thus the researcher was able to put together a uniquely valuable data base with cell samples. Unfortunately breakthroughs and profits eluded him and the company fell into bankruptcy where control of the valuable data was lost. The information has now been sold to drug companies and insurance companies (Did you know your disqualifying pre-condition originated with some ancient viking?) The possible horrors are hard to contemplate.

While government grants still fund the vast majority of research on disease and treatment, the drug companies have dominated the control and marketing of the resulting breakthroughs. Drug companies also include the government subsidies when justifying high drug prices. A Pharma sponsored study put the average cost per drug at $800 million which they round to a billion in talking points. Ralph Nader’s group, using Pharma’s own numbers puts the actual cost at about $100 million, still serious money.

The patenting mess has drawn the universities and other institutions into a dependency on marketing their patents and research that has totally compromised their role as independent investigators. One researcher assembled the worlds most valuable collection of cells and materials to study Alzheimer’s only to see his University of Washington sell the collection to Pfizer. He and his subjects were unable to reverse the sale. In one court case, Duke argued that their university researchers should be protected in their investigations only to have the court rule that since Duke patents research and sells licenses they are indistinguishable from any other corporation and their employees cannot be expected to have special privileges. Universities are no longer special. Further, virtually all researchers whether in the University or elsewhere are on the take from the drug companies.

Professional journals such as JAMA and the New England Journal of Medicine have been compromised to the point they are little more than paid drug ads. Journal articles are ghost written by drug employees with the named authors having no access to the underlying research numbers. Because everyone qualified is on the take, independent peer review of articles is no longer possible. The big danger in all this is that drug companies are able to hide and lie about the actual clinical trial results and cover over or minimize side effects. Thus doctors who rely on journals to keep up with medical advances are mislead as to the true risks of the drugs they prescribe.

Even worse, doctors are on the take to the tune of $6 billion a year with an additional $2 billion in junkets. How can a patient rely on a corrupted doctor’s recommendations for treatment?

Drug companies also contribute financially to the FDA’s operating costs. This gives them the power to remove FDA officials who may oppose approval. The FDA has moved from denying approval of questionable new drugs to requiring larger warning labels as if this will prevent or limit the drug’s inappropriate use. When a drug is pulled by the FDA it often is re targeted and relabeled and reintroduced with FDA approval such as the infamous thalidomide.


Lula da Silva announces Brazil’s HIV march-in

Governments all have the ability to require “compulsory licenses” for critical drugs like those for HIV. Brazil shocked Pharma in 2007 by announcing a compulsory license for Merck’s HIV efavirenz. India has long ignored drug patents and have become proficient as reverse engineering patented drugs. Brazil’s action has set off a chain reaction among other governments causing the drug industry to start to rethink its pricing policies for poor countries. In the last 20 years only 4 drugs have been developed for diseases unique to poor countries. One of those is sold only as a vaccine for visitors to those poor areas not for the residents themselves.

The Gates Foundation, WHO, and other groups are experimenting with a new model where entire governments in poor countries guarantee a market for a drug to treat diseases like sleeping sickness or malaria. It is hoped the guarantee will finally induce drug companies into manufacturing drugs for these diseases. International organizations are also encouraging drug companies to think of pricing tiers for poor countries and are helping to police the illegal re-importation of the cheap drugs. The actions of Brazil and India are encouraging this trend but counter pressures come from WTO attempts to enforce intellectual property rights, i.e. patents.

There have also been a few cases where gene patents have been overturned, most famously for the seven ovarian cancer patents on the genes BRAC1 and BRAC2. This case has been appealed and will likely end before the supreme court. Still this temporary limited victory gives Washington hope that things might be reversing and ever optimistic, she looks forward to the day when Bayh-Dole will be eliminated and the plant and animal and gene patent rulings reversed. Dream on. At least patents expire after twenty years unless companies figure cleaver ways to extend them so research and development may be able to resume after this wasteful interregnum.

Greg goes to Afghanistan – Kashmir

Friday, March 19th, 2010

Stones into Schools, Greg Mortenson, 2009

Update June 21, 2013. In 2011 allegations of fabrication and misconduct were made against Mortenson and CAI. For a comprehensive summary of his book “Three Cups of Tea”, the 60 minutes expose, and Jon Krakauer’s findings see Wikipedia‘s entry.
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Here is an update on the activities of Mortenson, the Central Asia Institute (CAI) and his self selecting “Dirty Dozen” following up on his previous Three Cups of Tea. Greg begins with an event from 1999 while he was visiting the Charpurson Valley. He had just met Sarfraz Khan, former mujahedin fighter with a disfigured hand who is making his living trading across the mountains into the Wakhan Corridor of Afghanistan (“no much success”) when they spot a group of 14 Kirghiz (nomadic Afghan) horsemen straight out of the 13th Century riding toward them. Their leader is the young son of the Kirghiz headman and he has heard that Mortenson is in the area and has ridden across the mountains to meet him and see if he would be willing to build a school for their children. Greg is so moved that he impulsively promises their school knowing full well he can’t go into Taliban controlled Afghanistan. It takes him ten years to keep his promise.


Video by Sarfraz Khan

Greg is so impressed with Sarfraz, who speaks seven languages and whose ancestors are Waki from the Corridor, that he hires him as his remote areas project manager. Thus begins what Greg calls the closest friendship of his life.

The promise of the school and the hiring of Sarfraz are the sort of impulsive decision making that make the CAI unique among NGOs. The other unique feature is their “last place first” philosophy, probably owing its origin to the first school Greg built in Korphe Pakistan a village so remote he first had to raise more money so he could build a bridge across a river in order to transport building materials to the village. Korphe was the village that rescued and nursed Greg after his failed attempt to climb nearby K2 and its headman Haji Ali is credited with Greg’s first and best education in the area (“After 3 cups of tea you will be friends forever.”). Haji Ali wanted a school for his grandaughter Jahan Ali, who became CAIs first high school graduate. The emphasis on girl’s education Greg acquired while growing up in Africa (where his father ran a hospital near Mount Kilimanjaro) and where he learned the expression “educate a boy and you educate an individual, educate a girl and you educate a community”. Greg has observed his girl students teaching their mothers to read and write proving to him the truth of this saying.

CAI offers scholarships to the smartest girls to continue their eduction. Once offered, these scholarships can be accepted at any time in the future. One girl was unable to accept a scholarship to become a health worker because of the opposition of the local headman. She married, raised children, and ten years later, the new headman asked her to accept her scholarship. She did, received her education, and returned to her village to help pregnant woman and their babies. Childbirth and infant mortality rates in her village fell to zero. She thinks that her own experiences as a wife and mother have helped her become a better trained health worker and she is grateful for the delay. This type of patience both by CAI and the students is one of the important lessons Greg has learned from his experience.

wakhan corridor
Wakhan Corridor

After 9/11 and the US displacement of the Taliban, Greg and Safran entered the Wakhan Corridor of Afghanistan and Safran began his education of Greg into Afghan “style“. Safran not only speaks the various languages of the area, but he adapts his accent to the specific region, speaking a fast, clipped Dari in Kabul, and slowing, softening, and rounding the language as he travels further into the Corridor until he morphs seamlessly into the next language of the region. He also adjusts his dress according to region and teaches Greg to follow him. Greg must have felt a little like Sir Richard Burton, the master of disguises. Safran also taught Greg about identifying the real decision makers during a Jirga (meeting of elders) just from their subtle gestures and body language. They develop close friendships with the leaders of the Waki and Tajik groups of the Corridor as well as the border security commander, Wohid Khan, who comes to their aid time after time. They build a series of more than 20 schools in the area. Safran also taught Greg the skills of avoiding kidnapping by never revealing your destination and changing transport frequently. This also assures that the driver is familiar with local conditions. They are constantly moving large sums of money from the Kabul bank to their remote schools to pay teachers, buy supplies and pay for construction. They are never robbed.

In 2005 the report that Americans had put a Koran down the toilet in an Iraqi prison set off riots throughout the Islamic world. NGO workers fled to Kabul and their offices and abandoned vehicles were destroyed. Greg stayed put as a guest in a house where he met for the first time the headman of the Kirghiz, Abdul Rashid Khan the father of horseman Greg and Safran had met in 1999. Abdul Rashid is returning empty handed from several months in Kabul where he had hoped to get help for his isolated people. Hamid Karzi made some half hearted promises which he had no intention of keeping. Abdul Radhid had spent much of his remaining capital to finance the trip. The government eventually sent one rusted out van to the Kirghiz who have no roads. Greg is able to again promise that CAI will build a school in Kirghiz so the old man can return home with some hope. The next day Greg traveled through scenes of destruction (the NGO offices) on his way to determine the fate of his nearby school. The school stood untouched because the village elders had stood in front of it explaining that the school belongs to the village. The rioters departed elsewhere. Greg credits the CAI strategy of making sure the local community takes full pride and ownership of their own schools with saving this school in the riots. The school was not viewed as international by the elders. Again on the NGOs, Greg comments that they insist on dressing in western clothes, drive the latest SUVs complete with nine foot satellite antennas, and generally just scream rich foreigners to the impoverished Afghanis. No wonder they find themselves targets of violence and resentment.

Greg is constantly approached by people wanting schools for their villages. Among those was the desk clerk at the Kabul guest house where Safran and Greg stay when in town. The clerk is a young Pashtun, Wakil Karimi, who grew up in Pakistani refugee camps and speaks several languages including English which is how he got the guest house job. Wakil persists about his school in visit after visit and Safran and Greg get to like him for his intelligence, energy, and persistence. They offer him a job as Afghan project manager and Safran begins Wakil’s boot camp training in Afghan “style“. Wakil’s village is in Taliban country but they visit and decide to let Wakil build his school once they see that the village elders really want it.

azad kashmir
Azad Kashmir

Then, in 2005, a massive earthquake devastates much of Pakistani controlled Kashmir. The CAI rushes to the area to see what they can do. Most schools in the area have collapsed and many students have died. The CAI manage to get some tents for temporary schools and start traveling among their tent schools to give aid and pay the teachers. They can’t rebuild schools because people are on the move, farming terraces and drinking water springs have disappeared, the students are afraid to be inside buildings, and their usual stone construction would just collapse in the next earthquake. The CAI scrounged some PVC piping and found itself restoring water supplies so the girls could stop carrying water and return to school. This infuriated some NGOs who had lucrative contracts to restore water but CAI could care less. They just wanted to get their schools functioning again and the NGOs would probably never get the job done.

Greg is always emphasizing the importance of listening. His daughter asked him one day how the earthquake victim children played. Greg thought maybe they didn’t play at all so his young daughter launched a personal effort to round up jump ropes. Mothers joined in and soon he returned to Pakistan carrying hundreds of jump ropes. They were a big success in Kashmir and soon CAI is buying jump ropes locally. Greg starts thinking that while a couple of school have play fields (for soccer), none have a playground with slides, swings, and see-saws. CAI starts adding these to their schools. He relates a story on Bill Moyer’s Journal and in this book about a group of pro Taliban elders who come to see one of CAIs schools. They spend 30 minutes playing on the playground equipment and then started to leave. Greg asked them if they don’t want to see the school. They say no, they already decided they want CAI to build them a school like this one but they insist it must have a playground.

In another instance of listening carefully, Greg finally got one traumatized girl to relate the experience of the earthquake in her tent class. When Greg asked her why so few students had returned to class she said it was because there were no desks and it didn’t seem like a school. The students somehow associated having a desk with the learning and security of school. Greg immediately set villagers to work finding salvageable desks in the school’s rubble and building new ones. The students returned to school, some even without tents sitting under a tree once the desks were available.

Greg returned home to Montana to raise more money but Safran meanwhile uncovered some Chinese engineers in Pakistan who have experience building earthquake resistant structures in Xinjiang Province China. He arranges for the Chinese to design and fabricate three schools in Xinjiang, arranges transport for the materials from Xinjiang, and sets the logistics in place to compete the schools on site in Kashmir in only one month. Lastly, (after already committing CAI to the schools without authorization) he faxes Greg in Montana for the $54k needed for the schools catching Greg by total surprise. Greg takes the schematics for the buildings which are prefabricated from wood and designed to move in a quake to a civil engineering professor in Bozeman. they are to be assembled on a floating concrete pad which can also move in the quake. They are designed to withstand a magnitude 8.2 earthquake. The professor declares the designs sound and Greg gets CAI board approval, as always, to proceed. The schools are ready for occupation in 19 days. Just another typical CAI project.

The following link shows a video with one of these earthquake resistant schools, the Balseri Girls School, Patika, Azad Kashmir, Pakistan in the background.

Greg comments that they encountered very few NGOs in remote Kashmir but the extremists groups including the one that later bombed Mumbai were very effective at reaching the remotest villages and setting up madrasas, extremist Islamic schools often led by illiterate teachers who have memorized a little of the Koran. They feed most effectively on remote and ignorant villagers.

Greg and Safran are terrible at dealing with bureaucracies and are busy building schools throughout the outer regions of Afghanistan without any license or sanction from the central government. They initially tried to register CAI as a NGO with the government but quickly gave up. One official contradictorily claimed 1) there are already hundreds of schools in the Wakhan (there were none); 2) the Corridor is actually a part of China (never); and 3) no one lives in the Wakhan (there are three distinct ethnic groups in the Corridor, each with several thousand members).

Wakil took upon himself the task of getting CAI an NGO license. He spent a full month in the process, finally yelling and shaming the bureaucrats into stamping his final document. Unstated but implied is the refusal of CAI ever to pay a bribe to a government official even when it is clear all other NGOs have paid bribes to get their paperwork approved. CAI stretches their dollars and can construct a typical school and fund it for five years for about $40k. In this context, the cost of even a modest bribe would be intolerable to them.

Greg knows that some of the elders that support his schools make much of their income from poppies and the drug trade. He acknowledges that there are few other opportunities to make money in Afghanistan and praises those that give most of the proceeds back to the people in the form of low cost loans, seed, and other assistance. He regrets the some Afghanis become opium addicts, the cost of which further impoverishes them.

Greg discusses his strange relationship with the US military. He was initially opposed to the US military actions in Afghanistan while welcoming the removal of the Taliban from power, allowing CAI to operate to build schools in the country. As he saw it, a single US missile costing $850k could be used instead to build 20 schools which is a far more productive use of resources.

Then the earthquake struck in Kashmir and the US military loaned a number of Chinook helicopters from Afghanistan to transport supplies in and wounded earthquake victims out and Greg came to see the now popular crews in a new humanitarian light. The crews themselves, after Iraq and Afghanistan also came to see themselves in this new popular humanitarian light and liked it.

The other strange thing that happened was that military wives came across the Parade magazine article about the CAI and started reading “Three Cups of Tea” and discussing the book at their women’s clubs. Their enthusiasm spilled over and soon their husbands, serving or having served in Afghanistan started reading the book, particularly, counter insurgence soldiers. Pretty soon, “Three Cups of Tea” was required reading in counter insurgence academies. Greg discovered all this when forward base commander Christopher Kolenda asked if CAI could build a school near his base in Kunar Province. Kunar Province certainly fits the description of an “end place” but it is also Taliban country. Nevertheless, Wakil and Safran visit Kolenda then sat down with the village elders and decided to build the school.

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Soldier Invites CAI to build school in Kunar Province

Thus began a major effort by CAI to build schools across the heart of Taliban country including Kunar Province and Nangarhar Province, the location of several Al Qaeda camps that includes the now famous Tora Bora caves where Bin Laden was thought to have hidden before slipping across the border into Pakistan. For one particularly vulnerable school they convinced a respected local Mullah to be headmaster. When warnings started appearing on the school, the Mullah went directly to Taliban leaders and convinced them to leave the school alone. They did. While CAI has had a little violence and threats at their schools, none have been damaged or closed unlike many other new schools that have been closed, students and teachers killed, and girls attacked with acid. Greg attributes the difference to the strong support the schools have had from the local elders and leaders. Even though CAIs schools are secular, they receive strong support from the local Mullahs.

CAI has by now received widespread recognition. Great Britain’s Prince Charles and his wife, Camilla, visited one of the Kashmir earthquake resistant schools; Greg became the recipient of the Star of Pakistan the highest civilian award in Pakistan; Admiral Mike Mullen, chairman of the Joint Chiefs of Staff, opened one of the Panjshir Valley schools; and Gen. David Petraeus and Gen. Stanley McCrystal are both Mortenson fans.

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Admiral Mullen with Mortenson

Greg quotes Mike Mullen to show how far the military has come:

The Muslim community is a subtle world we don’t fully – and don’t always – attempt to understand. Only through a shared appreciation of the people’s culture, needs, and hopes for the future can we hope to supplant the extremist narrative. We cannot capture hearts and minds. We must engage them; we must listen to them, one heart, and one mind at a time.

Quite a contrast to the usual nightly news Neanderthal general spouting nonsense about getting the bad guys like he’s playing some kind of video game, which incidentally, is how young military minds are recruited these days – through video games.

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Kirghiz porting their school

In late 2009 the nomadic Kirghiz finally got their school built on the very roof of the world at 12,500 feet. The logistics of getting materials and workers to the site required some miracle planning and an approach from three sides. Money and lighter materials like the door and window frames traveled across the Wakhan Corridor to the end of road where they were loaded onto Yaks for the three day journey to the site. Trained masons hiked over the mountain passes from the Charpurson Valley in Pakistan. A truck laden with cement, roof beams and other heavy construction material drove across Tajikistan to an old Soviet tank trail leading south toward a lake in Kirghiz. To get permission for the truck to cross Tajikistan, border commander Wohid Khan agreed to personally accompany the truck. From the lake, more Yaks and men transported the heavy materials the final 15 miles to the building site. Greg considers this his last best school even though illness has prevented him from seeing it. In fact fate has twice prevented Greg from entering Kirghiz. But after 10 long years, he has finally kept his promise.

For those wanting a good introduction of this region this book is one of the best. Greg furnishes a series of maps but it is hard to grasp the impact of all those massive mountain ranges. For a while Safran shuttled overland between Kashmir and the Wakhan Corridor to supervise his various building projects. Although the bird flight distance is only 200 miles. Safran needed to cross three different mountain ranges. For two he could drive CAIs 28 year old Land Cruiser across but for the third, into the Wakhan, he used his horse. His first horse died of exhaustion in 2006 and he acquired a new horse which is pictured in the book (They mistakenly identify the horse in the picture as the one who died, probably in the rush to publish. There are a few nonsense sentences in the book as well.). The most startling of the maps shows the ethnic distribution of the area (Pakistan and Afghanistan). There are 18 distinct ethnic groups shown here, one of which is “other” which implies there are even more groups. With the mountains and the ethnic diversity no wonder everyone is confused.

For an account of how the boundaries defining the various countries, including Afghanistan and Pakistan came to be and why Kashmir ended up in India (none of which has very much to do with ethnic boundaries) read the untold story of India’s Partition the tragedy that set off the chain of events leading to our current state. The “Great Game” between Russia and England, which contributed to the partition and boundaries predates the Cold War by a hundred years.

For a recent history of Afghanistan, the Soviet occupation, the CIA (Charlie Wilson’s War) and Pakistani intelligence backing of the Afghan mujahedin, followed by the abandonment of Afghanistan after the Soviet pullout giving rise to the Taliban read Steve Coll’s Ghost Wars.

Scottish odyssey

Saturday, October 10th, 2009

The Places In Between, Rory Stewart, 2006

I first discovered the Scotsman Rory Stewart on the Bill Moyer’s Journal. Rory Stewart is now director of the Carr Center for Human Rights Policy at the Harvard Kennedy School of Government. Lynn Sherr introduced Stewart as advisor to both Secretary of State Hillary Clinton and U.S. Special Envoy Richard Holbrooke. The following is a small part of the transcript:

LYNN SHERR: What do you tell them?

RORY STEWART: Again, my message is: focus on what we can do. We don’t have a moral obligation to do what we can’t. People can get very fixed by saying, “But surely you’re not saying we ought to do nothing? Surely you’re not saying we ought to allow the Taliban to do this or that?” And I just keep saying “ought” implies “can”– you don’t have a moral obligation to do what you can’t do.

LYNN SHERR: How is your advice taken?

RORY STEWART: I think what I see at the moment is that people are polite, because they imagine maybe I have some experience with Afghanistan. But I’m one of a broad community of people — we have nine people working in my center at Harvard who’ve worked there for 20 or 30 years and the problem we all have is that if the Administration has for some reason already decided that they’re going to increase troops, they’re going to do a counterinsurgency campaign, it’s very difficult for them to take on board people coming back and saying, “Look, actually, I don’t think this is going to work. It’s a great idea. I can see why you want to do it. But by trying to do the impossible, you may end up doing nothing. I’d like to present an alternative strategy, which is lighter, more intelligent, and may end up actually achieving something.”

LYNN SHERR: And again, their reaction? They listen politely, you say?

RORY STEWART: They listen politely, but in the end, of course, basically the policy decision is made. What they would like is little advice on some small bit. I mean, the analogy that one of my colleagues used recently is this: it’s as though they come to you and they say, “We’re planning to drive our car off a cliff. Do we wear a seatbelt or not?” And we say, “Don’t drive your car off the cliff.” And they say, “No, no, no. That decision’s already made. The question is should we wear our seatbelts?” And you say, “Why by all means wear a seatbelt.” And they say, “Okay, we consulted with policy expert, Rory Stewart,” et cetera.

So much for being an expert today.

Rory Stewart’s biography sounds like fiction. Born in Hong Kong in 1973, he was educated at Eton and Oxford. He was tutor to Prince Harry and Prince William. In the 90′s he joined the Secret Intelligence Service and served in the embassy in Jakarta dealing with East Timor. He was next appointed British representative to Montenegro dealing with Kosovo.

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Rory Stewart in Afghan garb with Mastiff Babur

This book recounts a small part of an amazing walking journey historian Rory Undertook over 20 months to recreate the 1514 journey of Babur (descendant of Timur and Genghis Khan) from Samarkand, Uzbekistan to Kabul which he conquered. By 1527 Babur had conquered all of Northern India establishing the Mogul dynasty with Agra his capital.

Rory spent 16 months walking from Iran to Nepal. The government of Iran took his visa away and he was refused entry to Afghanistan by the Taliban so he resumed his journey in Pakistan, crossing to Katmandu where, in December 2001, he heard that the Taliban had fallen, so he returned to Herat to pick up his journey from Herat to Kabul. Babur had made his journey through the mountains in the dead of winter and Rory seemed to find the prospect of doing the same thing in 2002 appealing. U.N. workers called him “a nutter” for his walk which he took as a complement.

This book recounts the kind of travel that is far more common in Europe than in America. Herman Hesse in Narcissus and Goldmund describes a young man wandering around medieval Germany indicating that this coming of age European “Walkabout” has been a tradition for a long time. Overland trips from Europe to India and Nepal by motorcycle, van, and bus were common in the 1960s and 1970s but with the Iranian Revolution and Soviet Invasion of Afghanistan in 1979 such journeys died down. A recent German biopic, Eight Miles High, of Uschi Obermaier features a three year trip with boyfriend adventurer Dieter Bockhorn by customize bus from Germany to India in 1973. Their adventure lasted three years and was highlighted by their wedding, complete with elephants, in India. God seems to protect the young and naive which is why most young travelers, despite taking crazy risks, seem to come through relatively unscarred by the experience.

As if walking through the mountains alone in the dead of winter were not enough challenge, Rory somehow acquires a dog, a half wild, uncared for 140 pound mastiff of indeterminate age that he names Babur. So not only does he have to beg for food and shelter in each village for himself, he must find food and shelter for his huge dog in a culture where dogs are considered unclean. A boy who is in training to become a mullah informs Rory that the Koran declares dogs to be unclean. When Rory asks to see the passage, the boy says he doesn’t know where it is. “But haven’t you memorized the entire Koran in your studies? Yes, but it is written in Arabic and I don’t understand Arabic.” Like Roman Catholics who loved the Latin mass they cannot understand, this boy has memorized the entire Koran without understanding anything in it. In many villages he has to fight off with his walking stick packs of dogs sent by children to harass him and his dog.

The journey itself is pretty bleak. Rory walks in sub zero temperatures, through blizzards with zero viability, fighting to forge a path through waist deep snow, and trying to break through thick ice to reach drinking water. Through the first half of his trek, he follows the Hari Rud river, climbing to its source. In Herat, Rory collects a series of letters of introduction which he hopes will result in offers of hospitality along his route. This plan is quickly dashed as a village headman demands the letters (for his own use) and Rory discovers that the local head men are mostly illiterate so cannot write much less read such letters. He falls back on an oral tradition where he recounts the list of men who have recently offered him hospitality and memorizes the names of important men he is likely to meet at the next villages. To make life more miserable Rory suffers from constant dysentery and headaches. He tries to document his travels by writing in his journal, sketching people he meets (some are reproduced in the book) and taking very dark black and white film photographs in which the features of people pictured can hardly be made out.

From Herat he is accompanied by two security soldiers who are ordered to walk with him halfway to Kabul. Both are wearing American camouflage overalls and ill fitting boots which damage their feet. The leader is a congenital liar who introduces Rory as an Ukrainian (Soviet), American Spy, U.N. high official with millions to disperse to the local authorities. After the two start suffering from dysentery and foot sores, Rory is finally able to bribe them to leave him and they return to Herat. With the occasional local guide as part of local hospitality, Rory completes his walk largely on his own.

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Minaret at Jam

Rory comes to the ancient city of Jam, destroyed by Genghis Khan. A lone minaret remains of what was once a major trading center. In the 1970s professional archeologists were busy excavating the historic city but the Soviet invasion forced them to leave and they have never returned. Rory encounters hundreds of local villagers randomly digging throughout the ruins looking for any artifacts which they will be able to sell to collectors for $1 or $2 dollars.

Rory’s route took through all four major ethnic groups making up Afghanistan. The Pashtun posed the biggest threat to Rory’s trek. When he asks village elders who they want to lead a new Afghanistan they invariably start by naming their local strongman. When Rory persists, they all mention Ahmed Shah Massoud the Tajiks fighter assassinated by al Qaeda. When he asks their opinion of Hamid Karzai, the most remote villagers immediately respond that Karzai is America’s puppet.

Stewart encounters more U.N. and other aid workers and writes one the best accounts of this new breed that I have seen anywhere (as a footnote):

Critics have accused this new breed of administrators as neocolonialism. But in fact their approach is not that of a nineteenth century colonial officer. Colonial administration may have been racist and exploitative, but they did, at least work seriously at the business of understanding the people they were governing. They recruited people prepared to spend their entire careers in dangerous provinces of a single alien nation.They invested in teaching administrators and military officers the local language. They established effective departments of state, trained a local elite, and continued the countless academic studies of their subjects through institutes and museums, royal geographic societies, and royal botanical gardens. They balanced the local budget and generated fiscal revenue because if they didn’t their home government would rarely bail them out. If they failed to govern fairly, the population would mutiny.

Post-conflict experts have got the prestige without the effort or stigma of imperialism. Their implicit denial of the difference between cultures is the new brand of international intervention. Their policy fails but no one notices. There are not credible monitoring bodies and there is no one to take formal responsibility. Individual officers are never in any one place and rarely in any one organization long enough to be adequately assessed. The colonial enterprise could be judged by the security or revenue it delivered, but neocolonialists have no such performance criteria. In fact their very uselessness benefits them. By avoiding any serious action or judgment they, unlike their colonial predecessors, are able to escape accusations of racism, exploitation, or oppression.

Perhaps it is because no one requires more than a charming illusion of action in the developing world. If the policy makers know little about the Afghans, the public knows even less, and few care about policy failure when the effects are felt only in Afghanistan… A year before they had been in Kosovo or East Timor and a year later they would be in Iraq or offices in New York and Washington.

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Murad Khane District of Kabul

A year after his Afghan trek, Rory Stewart was appointed Coalition (civilian) Deputy Governor of Maysan and Senior Adviser in Dhi Qar, two provinces in southern Iraq. From this experience he penned his second book The Prince of the Marshes: And Other Occupational Hazards of a Year in Iraq. For this he was made an Officer of the Order of the British Empire at age 31. In 2005, he founded an NGO, the Turquoise Mountain Foundation and spends much of his time in Afghanistan. Chalk one up for the neocolonialists.

Economics Debunked

Monday, December 29th, 2008

The Predator State, James K. Galbraith, 2008

James Galbraith’s father John Kenneth Galbraith (The New Industrial State 1967), in 2006 from his deathbed, suggested that James write this book. It was published in the spring of 2008 before the total meltdown of the financial system threw the economy into a downward spiral whose bottom we have yet to see.

The Keynsian Johns

Both Galbraiths are Keynesian economists, those forgotten guys. The basic tenet of Keynesian economics is that only aggressive government policy can stabilize the economy which is otherwise subject to massive swings, creating enormous problems such as run away inflation, failing financial institutions, failing corporations, and massive unemployment. But, hey, today everyone in Washington is a Keynesian, right? After forty years of Chicago school dominance, Keynes is back.

James Galbraith outlines a history of the world economy starting with the Bretton Wood Conventions following WWII which established the U.S. economy and the gold backed dollar as the standard on which all foreign currencies would be based. The breakdown of this system, started when Nixon went off the gold standard and allowed the dollar to float, provides the backdrop to a consideration of the major economic theories of the conservatives advanced to fill the void left by the abandonment of Bretton Wood; monetarism, supply side economics (with trickle down), balanced budgets, and free trade. Even the Democrats became advocates of balanced budgets and free trade.

One by one Galbraith exposes these theories to be false with no empirical evidence. Unlike Kline’s Shock Doctrine, which portrays Milton Friedman and his colleges as co conspirators in a massive transfer of wealth, Galbraith, who remains friends with some conservative economists, views them as benignly misdirected, living in their ivory towers where they consistently ignore the facts.

While the Presidents from Reagan through Clinton felt the need to incorporate conservative economists into their administrations to give a veneer of academic respectability, George W Bush felt no such need and simply appointed cronies who poured the public coffers directly into the pockets of lobbying client firms without any resort to economic theoretic justification.

Today there is open discussion of the role of Alan Greenspan in the current crisis. There is no corresponding discussion or remembrance of the role of his predecessor, Paul Volcker, who held interest rates at rates as high as 20%, ruining the economies in much of Africa, Asia, and Latin America who had borrowed heavily from the Chicago school dominated IMF who insisted on shock therapy changes as a condition of their loans. Unsurprisingly the struggling countries were unable to pay off the loans at the new extortionary levels. This led to a collapsed overseas markets for American products and to greatly strengthening the dollar, permanently weakening steel and auto production in the US as it was unable to compete with cheaper products from Germany and Japan. Galbraith points out that inflation is another thing economists are unable to understand or control. It seems to appear and disappear out of nowhere.

Galbraith attributes the fall of the Soviet Union largely to their inability of pay off their massive loans in an environment of super high interest. The rise of China and India as an economic powers was made possible precisely because they did not borrow heavily from the IMF or adopt shock therapy.

What actually ended inflation in 1984 was the incoming flood of foreign investments looking for high returns from the interest rates and the stability of the American government. It had nothing to do with monetarism, the supposed justification for the extortionary interest rates. Yet, worryingly, this same Volcker has been named to the new Obama economic team, presumably because of his “expertise” in fighting inflation. Lord, save us from the experts.

One concept, that of the free economy, Galbraith points out is without any meaning at all except perhaps to very large multinational corporations, yet all politicians who hope to be successful must pay lip service to it just as they must attend church even though they may be atheists. In the real world, free markets are so rare, they are almost non existent.

Galbraith points out when the Japanese real estate and financial bubble burst throwing that country into a decade long stagnation:

This dimmed the luster of the Japanese model for American observers, even as they largely overlooked the obvious point: there is evidently no development path that an unfettered, liberated, free capital asset market cannot screw up.

On the relationship between full employment (deemed by conservative economists to be inflationary and therefore bad) and wage inequality, Galbraith demonstrates, as do all Keynesians, that full employment, such as is enjoyed in Denmark, actually leads to greater wage equality, not less, and there is no evidence that full employment is inflationary.

Getting into the book’s central theme, he then makes some original observations along the lines of the Black Swan phenomenon. The big dominant corporations such as ATT and IBM lost their technological leadership to small startup entrepreneurs who were funded by new venture capital and equity raising wall street firms. The founders of these firms in Silicon Valley, Seattle, Boston, and other technology hubs overnight became extremely wealthy together with their supporting financial institutions.

Traditional companies became dependent on technology from outside rather than developing it internally and the CEOs of these traditional companies became extremely envious of the great wealth of these new technology usurpers. The CEOs formed closed groups, gained control of boards of directors, and demanded and received compensation and bonuses to close the gap with their entrepreneurial counterparts at levels unsustainable by the companies they ran. In a word, these CEOs became predators, preying on the companies they supposedly were leading (down the drain).

Unmanned Predator RQ-1

This group did not come from within their companies but were outsiders with little technical knowledge of the company. Their primary justification for their compensation was that they had been CEO of other firms where they were paid outrageously. As a new and small elite, they became predators, feeding off and destroying stockholder value and even whole companies as they competed with other CEOs to maximize their own compensation. They measured their own success and worth, not by the success of the companies they were failing to lead, but by their accumulation of personal wealth. Where did this loot go? Not into the productive economy, but into private mansions and conspicuous consumption.

Galbraith attributes the decline of the modern American industrial system studied by his father to:

These four phenomenon — the rise of trade, the reassertion of financial power (wall street and venture capital), the outsourcing of technological development, and the ascendancy of an oligarchy in the executive class — … had dramatic effects on American industrial corporations, on the way they are run, and on their broadly declining position in the world.

On the need for and desirability of regulation:

…Regulation helps the competitive position of relatively advanced businesses, by reducing or even eliminating the competition from backward enterprises that offset higher production posts with less safe factories and products and will lower wage bills.

Unfortunately for America the advanced “better” businesses of today are often offshore like the Japanese automakers.

Galbraith considers the rise of predator executives not to be a part of the normal process of growing wealth disparity, but a separate and more pernicious phenomenon. Not satisfied to raid and bankrupt their firms, this group set out to control and dominate the government and its apparatus as well. They are not normal conservatives, desiring a smaller government; they want a strong government, led by an imperial executive branch, in position turn a blind eye to regulation, to privatize as many government functions as possible with extortionary contracts, but also to be ready to bail them out when their destructive practices bankrupt their companies. By controlling government, they can minimize governments regulatory oversight that may interfere with their predatory practices while assuring that the government is ready with contracts and bailouts when needed. Hence the phenomena of Cheney turning the executive, and Newt Gingrich, Tom Delay, and Jack Abramoff turning the congress into the arms of the new predator state.

Predator State

…it is fair to say that the very concept of a public purpose is alien to, and denied by the leaders and operatives of this coalition.

Modern corporate decision-making structures exist … to permit senior executives to do what they want… This is the culture that Richard Cheney brought back into government… The operational result is a government by cliques operating in secret, indeed with their very membership unknown outside…We have instead (of checks and balances) a government public relations apparatus whose purpose is not to persuade but to deflect, deter, and frustrate inquiry into the operation of the government…It fills the courts with functionaries who are prepared to act as enablers for the executive branch.

But if the government is predatory, then it too will fail in every substantial way (just like the corporations). Government will not cope with global warming, or with Hurricane Katrina, or the occupation of Iraq, or Election Day chaos, or avian influenza, or nuclear weapons…Failure on that scale is not due to incompetence. It is intended. Inside government no one cares. The attention of the people in charge is focused on other goals (acquiring massive personal wealth).

So, can the predator state be turned around under an Obama Presidency to tackle current problems like global warming, broken health care, a financial meltdown taking more and more companies with it? Galbraith hopes so but recognizes how broken government is, how far down the predator path we have gone.

Galbraith ends with discussions of the need for reestablished regulation and the re institution of utilities where free markets do not exist (like California and Texas electric power), the need for massive new levels of government planning and investment to rebuild infrastructure, provide public services like education and health care, and to tackle really tough problems like CO2 emissions and global warming. He pleads for the reestablishment of standards for safety, working conditions, minimum and maximum income and the environment. We also clearly need new standards for financial markets and energy and global trade. Galbraith remains confident that America will be able to pay for all these reforms and recover its global leadership position as an innovative, moral, economic power.

This book is a compact 200 pages. It would have been helpful to provide more detail and facts to debunk the conservative’s economic theories, but maybe Galbraith thought too much detail would discourage readers.

Darker Side of Shock

Monday, July 28th, 2008

McMafia, Misha Glenny, 2008

This well researched look at global criminal empires highlights the darker side of the Chicago School’s Shock Doctrine. When the Chicago boys set out to massively transfer the worlds wealth into the hands of a few oligarchs, they simultaneously undermined state apparatus of regulation and control and brought about the most massive increase in organized crime in human history. The increase was not only in scale but in violence and capability as former secret police and world class martial arts athletes found themselves in need of new employment. The pinnacle of this worldwide movement was reached under Yeltsin who moved control of vast reserves of oil and natural gas to his handful of oligarchs. Realizing they needed protection that the state could no longer provide, the oligarchs turned to private organized criminal elements, who for 10% of the profits, were very effective at protecting the fortunes of the new Billionaires. Overnight, criminal organization found themselves rolling in wealth undreamed of by earlier criminal elements. Enter the Billionaire godfathers. Clearly this great wealth could not be left lying around the highly unstable financial institutions of the shocked states and Reagan and Thatcher come to their rescue deregulating the world’s financial institutions allowing movement and laundering of mind boggling Billions through places as diverse as Switzerland, Dubai, Tel Aviv, and tiny South Pacific Islands. Now needing to be able to travel anywhere in the world, Russian mobsters rushed to become Israeli citizens so they could get widely accepted Israeli passports. Even non Jewish Russians joined the rush to get a passport. So gratful were the Russian mob bosses to Israel, they jointly agreed not to engage in criminal behavior inside Israel as long as Israel continued to launder their Billions.

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We start our tour in the Balkans where the mobs were cooperating fully through multiple wars and ethnic strife, even smuggling goods and people directly through the front lines of the wars. Moving to the Crimean Sea, he notes that the breakup of the Soviet Union and loss of control is now endangering the Sturgeon as Moscow’s new Billionaires gorge on caviar. A tiny sliver of Moldova, Transnistria split into an independent criminally dominated country. The Russian fourteenth army and its vast arsenal were located in this area and chose to stay in the new state providing arms and force to ensure the independence of the new state. Putin has called Transnistria the black hole and it is one of the biggest arms sources in the world. Most people have left the tiny country which boasts a world class soccer team than performs at home before 4,000 fans.

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In India we discover that Bombay (Mumbai) is the organized crime capital which has assumed control over Bollywood. The mob bosses used to live in Dubai where they can be protected from the police and rival gangs, but a recent crackdown has sent them to Pakistan where the ISS Pakistani intelligence provides them shelter and training. From Pakistan they are free to launch attacks into India.

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In Japan we learn the integral roll of the yakuza in Japanese society. They were centrally involved with the Zaibatsu and the big banks in the 80s real estate bubble but received primarily blamed when the bubble burst. The yakuza’s biggest problem today is aging and the inability to recruit young Japanese men to join them. They are forced to subcontract much of their dirty work to the Chinese tongs or Korean gangsters.
China is feared throughout Asia. Its primary current contribution to global crime is their ability to copy and reproduce virtually anything up to and including ersatz Mercedes automobiles.

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South Africa leads organized crime in the continent. In Latin America Columbia is still a big supplier of cocaine to the world, shipping via Mexico into North America, and via Brazil into Europe. Brazil is particularly attractive because of its trained chemists and local access to virtually any chemical needed in production.
The US war on drugs has done more to perpetuate the global market for narcotics than any program in history. The only thing holding back growth of heroin and cocaine whose prices are dropping is the ready availability of synthetic drugs like ecstasy and methamphetamine (the drug of choice in Asia). Instead of regulating and taxing narcotics, governments are spending vast revenue in the hopeless effort to reduce of eliminate it. Any seizure or arrest leads to the immediate filling of the vacuum by new criminals and new shipments of the drug.
The trend toward globalization and domination by multinational corporations has blurred the distinctions between the legal and illegal. Is it any more legal for corporations to move money offshore to avoid taxation than for mobs to launder their money? Does the scramble to protect property rights give the rights to multinational corporations to patent plants and herbal cures that have been known to places like China and India for thousands of years? Does a patent give the right to a corporation to deny medication to those who can’t afford it?

Somehow the author is able to interview many of these underworld leaders and he seldom misses the local brothels.