24 February 2015

Das Kapital - Greece and the bloody-mindedness of German capitalism


Imagine a country for which Rs 100, say, of external debt has just matured. If this amount is paid immediately, then its consumption and investment levels will have to be squeezed, forcing the country to a regime of quasi-stagnation and low living standards, which would bring huge social unrest in its wake. The alternative is to defer debt-collection, allow the country to use this Rs 100 for domestic consumption and investment, and to supplement this amount with additional resource mobilization at the expense of the tax-evading rich, to boost consumption and investment still further. In that case, the living standards of the people, and the growth rate of the debtor country, will be markedly higher than in the first scenario. And if this growth rate exceeds the rate of interest on the debt, then creditors need not even be worried about default, since the country at a future date will have less to pay relative to income than now, in clearing the legacy of this Rs 100 of current debt.

Hence, as long as the interest rate on the deferred debt is lower than the growth rate that a programme of which debt-deferment is a part would generate, creditors should not mind debt-deferment. Why then is the Angela Merkel government of Germany so vehemently opposed to a re-scheduling of Greek debt, when the people of Greece, squeezed by years of austerity, have just voted to power a political formation that promises to end it, and whose failure will cause massive political and social unrest in Greece and in Europe at large?

The answer, it may be thought, is that this condition, about the growth rate following debt-re-scheduling being higher than the interest rate on the re-scheduled debt, will not hold, since the market will be reluctant to lend to an already over-indebted Greece, or to roll over its debt, at less than a considerably high interest rate, because of the risks involved. But much of Greece's debt is now owed to the European Central Bank (and even if this were not so, the ECB could have stepped in to take over the debt), so that the market does not enter the picture. Besides, in the current world scenario, where the crisis has forced down interest rates in the advanced countries, even to nearly zero in the United States of America, this condition should not be too difficult to fulfil for the ECB.

The reluctance of Angela Merkel's Germany to re-schedule Greek debt is not a personal issue concerning Merkel. Her behaviour is dictated by the predilections of her main constituency - globalized German capital. But why should German capital act in this way? One possible reason could be fears of the Greek government's reneging on promises of payment in future. But it is always open to the European Union to exert the same pressure on Greece at some future date in the event of its dilly-dallying on payment, as it is exerting now; and, at that future date, the resistance to payment will also be lower because of the relatively lower burden of the debt. Besides, the very fact of Syriza keeping faith with the people (otherwise it would not be asking for debt deferment) should persuade German capital of the reliability of its word. So this cannot be the explanation for Merkel's intransigence.


Joginder Singh 
23 February 2015

Terrorism is not a new problem. It has existed since the time of Christ. But the question is: Can the world end terrorism? If yes, then does everybody agree on how to fight this growing menace?

It may seem like terrorism is a modern phenomenon, but in fact, it goes back 2,000 years when a Jewish extremist group tried to expel the Romans and their sympathisers at the beginning of the first century AD with the use of daggers hidden in their cloaks. In a public gathering, the zealots pulled their daggers to attack not only the Romans and their sympathisers, but all Jewish collaborators, including the Herodians and the Sadducees.

Orsini was an Italian leader of the ‘Carbonari’, who attempted to assassinate French Emperor Napoleon III on January 14, 1858, while the Emperor and Empress Eugénie de Montijo were on their way to the theatre, by throwing three bombs at the royal carriage. The incident resulted in the death of eight bystanders and injured 142 more.

A terrorist attack happened in the Financial District of New York City on September 16, 1920. It killed 38 people and injured 400 more. The attack involved a horse-drawn wagon containing 45kg of dynamite with 230kg of slugs. It instantly killed all the brokers, clerks, messengers and stenographers working in the area and destroyed the interiors of the JP Morgan building. The crime was never solved

There were a series of terrorist attacks on US embassies in the east African cities of Nairobi and Dar es Salaam on August 7, 1998, the eighth anniversary of the arrival of US forces in Saudi Arabia. The truck bomb explosions were linked to the local terrorist group of Al Qaeda, headed by Osama bin Laden. The trucks, laden with three to 17 tonnes of high explosive materials, detonated simultaneously, leaving over 200 dead and thousands wounded. Though it was directed at American facilities, most of the victims were local citizens — with only 12 American casualties. The 9/11 attack on New York is still fresh in people’s memory, as are the attacks on the Indian Parliament and in Mumbai trains, wherein thousands have been killed.

Burning of Pak boat: All at sea


Admiral Sushil Kumar (retd)
It was a straightforward maritime operation
The handout photograph released by the Ministry of Defence is said to show a burning vessel off the coast of Gujarat in the Arabian Sea on January 1, 2015.

Seen professionally, the recent interception of an intruding Pakistani boat by the Indian Coast Guard was by all accounts a well-coordinated maritime operation. Since national security interests were at stake, a covert operation of this nature, based on actionable intelligence, had necessarily to be executed on a need-to-know basis. But unfortunately, this straightforward maritime operation by Indian security forces has been given weird interpretations and dragged into a political quagmire. As if that was not bad enough, we now have self-styled experts and loose cannons joining the fray and fanning the controversy. 

It is well known that a terrorist, who is psyched up for a mission, is more than likely to commit hara-kiri if caught red-handed. And more so is this true when desperadoes are nabbed at sea with hardly an escape option. Our Navy and Coast Guard have ample experience of this modus operandi. What happened during Operation Cactus in 1988 and Operation Alondra Rainbow in 2000 are classic examples of this. 

So is it any wonder why the intruding Pakistani boat went down in a fiery blaze if it was merely on an “innocent passage” with nothing to hide? Moreover, is it not presumptuous of armchair analysts perched ashore to question the tactical judgement of the commander at sea on how to approach a suspicious vessel with obviously dishonourable intentions?

Finally, while political discourse and debate are required in a democratic system, is it really fair to cast aspersions on the purpose of a covert operation when the agencies concerned are bound by a code of secrecy? Not only could this dent the morale of our security forces but also offer a lifeline to inimical forces across the border.
This is best conveyed in the oath for the Indian armed forces: “The safety and honour of our country come first — always and every time”. 

Secrecy and information theft

February 24, 2015

Though the new government at the Centre has done a lot to block unauthorised access to government offices, the recent incident of the loss of data from a key Ministry shows that loopholes are still being exploited and much ground needs to be covered in terms of enhancing security

Government offices the world over are notoriously porous. Even those which boast of a high standard of physical security sometimes do not have a matching ability to protect their information systems. WikiLeaks is a striking example of how even one of the most technologically advanced nations like the United States can be found wanting in this area.

The appalling state of India’s public offices is a case in point. The buildings that house them take the cake for permitting shockingly liberal access to vandals and marauders. The disgusting state of hygiene in most of them in itself bears testimony to their porous nature and neglect, both of which certainly promote an ambience that is least conducive to a security culture.Porous and unsecured

While Central government offices are a shade better than those in the States in terms of visitor control, there is no scope for being smug. This is despite the fact that the new government at the Centre has done a lot to block unauthorised men, including lobbyists, from visiting government offices. In a much less complicated universe, in the early 1950s, Rajaji, as Chief Minister of the Madras State, successfully kept out ruling party men from the sacred confines of Fort St. George. This has possibly not had the desired result as reports of leakage of valuable information from a key Ministry in the nation’s capital show.

All you need to secure entry into many government offices in our country is a reasonably attractive-looking identity card, which may not necessarily be genuine or whose validity has expired. Few questions are asked after one gains entry. There are no sequestered areas which are out of bounds. Greasing the palms of security staff to secure unauthorised entry is also not an unknown practice. Here again where there is deployment of Central Industrial Security Force (CISF) guards, things are in fairly reasonable shape. Elsewhere, the security staff are ill-trained and clueless and therefore abysmally inadequate.

Shastri Bhavan which houses many important Ministries — including Petroleum and Human Resource Development — is the most prominent among the many administrative buildings in the capital which usually resembles a kumbh mela on most working days. Those found on its campus constitute a spectrum, which includes influence and information peddlers and hangers-on, watching the hustle and bustle of the place. Those who are there on genuine business form only a minority. The heist of documents from the Union Petroleum and Natural Gas Ministry should be viewed against this backdrop.Corporate angle

ISIS starts English schools for foreign fighters’ kids

Adam Withnall,The Independent
Feb 24, 2015

Amid ongoing concerns that three British schoolgirls have been lured online to travel to Syria and join the self-proclaimed “Islamic State”, activists in the militant-controlled city of Raqqa drew attention to a flier for the “attention [of] English speaking muhajiroon”.

The ISIS militant group has reportedly opened its first two English-language schools in the so-called "capital" of its territories, in what appears to be a direct attempt to cater to the families of foreign fighters. 

Amid ongoing concerns that three British schoolgirls have been lured online to travel to Syria and join the self-proclaimed "Islamic State", activists in the militant-controlled city of Raqqa drew attention to a flier for the "attention [of] English speaking muhajiroon". 

The flier, emblazoned with the ISIS logo, claims that "by the grace of Allah we have opened schools for English speaking children". 

It provides contact details and lesson times for two separate facilities, one for boys and one for girls, which appear to have been set up on the grounds of a pre-existing school. Abu Ibrahim Raqqawi, an activist with the group 'Raqqa is Being Slaughtered Silently', posted an image of the flier. He said it offers "teaching to foreign fighters' children" in a range of religious studies, Islamic law as interpreted by ISIS, English, maths, and "jihadiyyah". 

The flier says there will be part and full-time roles for teachers — and calls on English speakers to "get in touch". Raqqawi said schools in Raqqa reopened only this month and many parents "are so worried that their children will be brainwashed that they mostly keep them at home". the independent

Russia and US spar over global crises at UN meeting

Feb 24, 2015

Russian Foreign Minister Sergey Lavrov implicitly accused the US of violating UN principles by bombing Syria, occupying Iraq "under false pretenses'' and manipulating a Security Council mandate to destroy and create chaos in Libya.

UNITED NATIONS: Russian Foreign Minister Sergey Lavrov implicitly accused the United States on Monday of violating UN principles by bombing Syria, occupying Iraq "under false pretenses'' and manipulating a Security Council mandate to destroy and create chaos in Libya. 

US Ambassador Samantha Power implicitly criticized Russia for blocking Security Council action against the Syrian government and accused Moscow of training, arming and fighting alongside separatists who have seized Ukrainian territory. 

They traded accusations during a ministerial meeting of the UN Security Council to assess the operation of the United Nations as it nears its 70th anniversary. The meeting was organized by China and was the first-ever chaired by a Chinese foreign minister. 

Lavrov was clearly pointing at the United States without naming it when he singled out the current bombing of Syria, where the U.S. is targeting extremists from the Islamic State group, the U.S. occupation of Iraq starting in 2003, and the NATO-led uprising in Libya in 2011 strongly backed by the Obama administration. 

``This is a result of attempts to dominate global affairs, to rule over all, everywhere, to use military force unilaterally to push one's own progress, one's own interests,'' Lavrov said. 

The Russian minister also implicitly accused the U.S. of using ``unsavory methods'' such as mass pressure on sovereign states to promote Washington's agenda, and promoting regime change including ``open support for the unconstitutional state coup in Ukraine a year ago.'' And he implicitly accused the U.S. of trying to turn the Security Council into a body which would ``rubber stamp'' its decisions. 

''Unilateral actions of force'' in recent months, he said, ``have plunged the Middle East and northern Africa into instability and chaos, and to a large extent have created a breeding ground with which extremists thrive.'' 

Power, pointing clearly at Russia _ a close ally of Syria which has blocked council action aimed at pressuring President Bashar Assad to end the four-year conflict _ decried the escalating death toll and the Syrian government siege tactics that have taken ``a devastating toll on civilians, the people the U.N. Charter is supposed to protect.'' 

How Much Can We Forgo To India Inc?


The TV anchor asked eagerly of Arun Jaitley whether he would take hard decisions or, in the case of a bad drought, revert to loan waivers and (obviously wasteful) subsidies. The finance minister replied that it depended on the situation as it unfolded but he hoped he wouldn’t have to return to such steps. “We hope so too,” said the anchor fervently. Which was cute, coming from someone pushing a wish list of the corporate world as hard-hitting journalism. A corporate world which has on average received Rs 7 crore every hour (or Rs 168 crore every day) in write-offs on just direct corporate income tax alone. And that for nine years running. (Longer, but we only have data for those nine years.)

And that’s if we look only at corporate income tax. Cast your gaze across write-offs on customs and excise duties and the amount quadruples. The provisional figure written off for the corporate needy and the and the belly-aching better off is Rs 5,72,923 crore. Or Rs 5.32 lakh-crore if you leave out something like personal income tax, which covers a relatively wider group of people.

It’s close to three times the amount said to have been lost in the 2G scam. About four times what the oil marketing companies claim to have lost in so-called “under-recoveries” in 2012-13. Almost five times what this year’s budget earmarks for the public distribution system. And over 15 times what’s been allocated for the MNREGS. It’s the biggest giveaway, an unending free lunch that’s renewed every year. Gee, it’s legal, too. It is government policy. It’s in the Union Budget. And it is the largest conceivable transfer of wealth and resources to the wealthy and the corporate world that the media almost never look at.

India’s economy A chance to fly

India has a rare opportunity to become the world’s most dynamic big economy Feb 21st 2015 

EMERGING markets used to be a beacon of hope in the world economy, but now they are more often a source of gloom. China’s economy is slowing. Brazil is mired in stagflation. Russia is in recession, battered by Western sanctions and the slump in the oil price; South Africa is plagued by inefficiency and corruption. Amid the disappointment one big emerging market stands out: India.

If India could only take wing it would become the global economy’s high-flyer—but to do so it must shed the legacy of counter-productive policy. That task falls to Arun Jaitley, the finance minister, who on February 28th will present the first full budget of a government elected with a mandate to slash red tape and boost growth. In July 1991 a landmark budget opened the economy to trade, foreign capital and competition. India today needs something equally momentous.

Strap on the engines

India possesses untold promise. Its people are entrepreneurial and roughly half of the 1.25 billion population is under 25 years old. It is poor, so has lots of scope for catch-up growth: GDP per person (at purchasing-power parity) was $5,500 in 2013, compared with $11,900 in China and $15,000 in Brazil. The economy has been balkanised by local taxes levied at state borders, but cross-party support for a national goods-and-services tax could create a true common market. The potential is there; the question has always been whether it can be unleashed.

Asia's Looming Currency War?

February 23, 2015 

"There may be a currency war coming, but—for now—the markets are witnessing a violent return to dollar normalcy."
Central banks are not waging a currency war. Their actions, which may seem warlike on the surface, arise from far more benign motives. Many Central Banks have mandated inflation targets, and in most regions inflation is below target. With a slowing global economy, there had been few ways to keep inflation up to code. But a turn in U.S. monetary policy has made it possible for Central Banks to meet their policy goals by reflating their domestic economies.

Part of the issue is that the central banks who have missed their goals are the global economic heavyweights, whose policy shifts have a more potent effect on global markets than others. Europe is struggling with high unemployment, deflation, and a Greek epic with seemingly no end. Japan has been stagnant for most of the 21st century and faces a truly horrific demographic profile. China is fighting to avoid the consequences associated with rising wages, slowing growth, and increasing deflationary pressures. The central banks of these nations are forced to take actions to thwart domestic economic catastrophes.

There are few reasons for global central banks to competitively devalue their currencies against the U.S. dollar. After all, the U.S. is the world’s buyer of first resort, and (with the Federal Reserve mulling a “lift-off” from the zero bound later this year) the U.S. Dollar’s value is likely to rise. Instead of waging a currency war, central banks embarking on new or additional quantitative easing (QE) packages—Japan and the EU—may be making a legitimate attempt to meet their mandates.

QE tends to increase the prices of domestic assets and lower yields on sovereign debt. Under the U.S. program, prices of assets from equities to housing moved higher, inflation was steadily positive, and employment increased. Seeing how the U.S. withstood much of the global deflationary pressure (though it never quite reached its target of 2 percent inflation) and created jobs, it is reasonable that facing similar circumstances, other central banks would make a similar determination to increase domestic asset prices.

Personnel and Policy in U.S. Policymaking Toward China

By Elizabeth C. Economy
February 22, 2015

Is the Obama administration really weak on China expertise? 

Alarm bells are ringing yet again over the apparent dearth of expertise and interest in China within the Obama administration. This is a problem I have been tempted to write about on a number of occasions over the past year or two. I have not done so because I do not think that there is a problem. Still, people keep writing articles suggesting that such a problem exists, so perhaps it is worth taking a bit of time to assess the claim.The problem, as several writers and analysts have identified it, is that the current constellation of senior U.S. officials—as opposed to those who served in the first term, or term and a half, of the Obama administration—lacks interest in, and expertise on, China.The argument is roughly as follows:

Treasury Secretary Geithner studied Chinese in college and spent two summers in Beijing; Treasury Secretary Lew did not. 
Ambassador Huntsman is extremely knowledgeable about China, and Ambassador Locke is Chinese-American; Ambassador Baucus is neither. 
Secretary Clinton articulated a masterful vision for U.S. policy toward Asia and China in the form of the pivot; Secretary Kerry did not. 
National Security Advisor Donilon was interested in China; National Security Advisor Rice is not. 
There are no senior China experts in the relevant U.S. bureaucracies. 

Points one and two can be dismissed relatively easily as true, but irrelevant. The real question is whether any knowledge of China, Chinese, or being Chinese contributed to the United States having a policy advantage in its relations with Beijing. Did Secretary Geithner’s China background, for example, yield a better outcome on currency negotiations? It does not seem so. 

U.S.-China Relations: The Hypocrisy of Rules

By Joan Johnson-Freese
February 22, 2015

Both countries are selective in which rules-based regimes they choose to support. 

Perhaps, as the expression goes, hypocrisy rules the world; but certainly hypocrisy rules politics, at least the political aspect of U.S.-China relations relating to the establishment of rules intended to bring order to potential dangerous situations. Each country purports to want rules, but only in areas where it suits them, and then follows them when convenient. China is pushing for rules related to the weaponization of space, which the United States has summarily rejected, repeatedly. The United States wants an agreement on air-to-air encounters; the Chinese are stalling. Whether the rationale behind the desire for rules, order and predictability in potentially unstable and dangerous situations will prevail over other perceived interests remains to be seen.

In 2000, the U.N. General Assembly voted on a resolution called the “Prevention of Outer Space Arms Race.” It was adopted by a vote of 163 in favor to none against, with three abstentions: the Federated States of Micronesia, Israel and the United States. On December 8, 2003, 174 nations voted “yes” on a United Nations resolution calling for negotiations toward preventing an arms race in space. Only four countries abstained: the United States, Israel, Micronesia, and the Marshall Islands. Micronesia, the Marshall Islands, and even Israel aside, it is not difficult to understand how some countries might get the impression that the United States is stiff-arming strong international opinion that space should remain a sanctuary from weapons and warfare.

China and Russia have been long and vocal advocates of banning space weapons. In 2008, they introduced a draft treaty to the United Nations (UN), which the United States rejected based on issues regarding verification. In 2014 the Chinese and Russian submitted a revised version of the treaty, which was again rejected by the United States. Frank A. Rose, U.S. deputy assistant secretary of state for arms control, verification, and compliance told a June 2014 session of the U.N. Conference on Disarmament: “The United States believes that arms control proposals and concepts should only be considered by the international community if they are equitable, effectively verifiable, and enhance the security of all.”

China and the South China Sea Resource Grab

By Michael Fabinyi
February 22, 2015

Maritime disputes in the region have more than just legal and military dimensions. 

Much recent political commentary has focused on the dispute between China and the Philippines in the South China Sea. There is widespread recognition that a key driver of the dispute is competition over the region’s natural resources. This has led prominent commentators such as Robert Kaplan to warn of the likelihood of “Finlandization.” Yet, despite ongoing legal arguments, China currently has access to important natural resources in the Philippines. While international actors debate the legal status of Chinese and Philippine claims, China is continuing to “change the facts on the ground” in terms of access to resources. It does this through conventional rhetorical pressure and military means in the South China Sea, and by other modes of access to resources, including favorable trade arrangements and poaching. While attention does obviously need to be paid to legal developments and conventional military pressure in the South China Sea, policymakers need to focus also on how contests over natural resources are currently unfolding in other contexts.

A conceptual focus on “access,” as opposed to the narrower view of “property,” is important in understanding these natural resource contests. In their seminal article on access, Jesse C. Ribot and Nancy Lee Peluso argue for a broader understanding of how people are able to obtain the benefits of resources. While formal and legitimate property rights are one mode of access, access in practice can include a far wider variety of mechanisms. These are not necessarily always perceived as legitimate, and can include social processes such as trade relations, social relations, and power.

Oil and gas are the most valuable natural resources in the South China Sea, and thus the most high-profile. But fisheries resources constitute an insufficiently recognized economic and symbolic element of the dispute between China and the Philippines. Fisheries resources in this region not only represent current economic value, but also see fishermen forming the “human front line” of the dispute between China and the Philippines. They are used as pawns by governments in their efforts to legitimize their claims: in the court of international public opinion, fishermen are easier to defend than naval boats. They form a fundamental part of what Robert Haddick influentially described as China’s “salami-slicing strategy,” which involves “the slow accumulation of small actions, none of which is a casus belli, but which add up over time to a major strategic change.”

The dispute between China and the Philippines has simmered for many years, but has become particularly intense since July 2012, when a Chinese naval frigate ran aground at Half-Moon Shoal. This shoal lies 60 nautical miles off the coast of Palawan province, the westernmost province of the Philippines that faces the South China Sea. In May 2014, eleven Chinese fishermen were apprehended at Half-Moon Shoal; nine of them were eventually sentenced with fines of $102,000 in November. In 2013, the Philippines submitted a case to the International Tribunal for the Law of the Sea (ITLOS). Through this action the Philippines has adopted a strategy of appealing to external actors and institutions (such as the U.S. and international law) in order to try and gain legitimacy for its claims of property.

China Is Still Top Target of NSA’s Computer Hackers

Chen Weihua
February 21, 2015

There has been plenty of talk lately by US officials on strengthening cyber security, but none of it touched on US cyber intrusion in other countries. 

On Monday, The New York Times reported that the United States has found a way to permanently embed surveillance and sabotage tools on computer hard drives and in networks it has targeted in China, Russia, Iran, Afghanistan and other countries closely watched by US intelligence agencies.

Citing a report by the Russian cyber security firm, Kaspersky Lab, the Times said the implants had been placed by what it called the “Equation Group,” which appears to be a veiled reference to the National Security Agency (NSA) and US Cyber Command.

The same story was covered by The Intercept, which said the malware has been used to infect thousands of computer systems and steal data in 30 countries around the world. Among the targets were a series of unnamed governments, telecom, energy and aerospace companies, as well as Islamic scholars and media organizations.

The report linked the techniques to those used in Stuxnet, the computer worm that disabled some 1,000 centrifuges in Iran’s nuclear-enrichment program. It was later revealed that Stuxnet was part of a program code-named Olympic Games and run jointly by Israel and the US, according to the Times.

Some of the implants burrow so deep into the computer systems that they infect the “firmware,” the embedded software that preps the computer’s hardware before the operating system starts. It is beyond the reach of existing antivirus products and most security controls, making it virtually impossible to wipe out, the Times quoted the Kaspersky report as saying.

In many cases, it also allows US intelligence agencies to grab the encryption keys off a machine, unnoticed, and unlock scrambled contents. Moreover, many of the tools are designed to run on computers that are disconnected from the Internet.

State Department spokeswoman Jen Psaki said on Tuesday that “we are not going to comment publicly on any allegations that the report raises, nor discuss any details.” Her words echoed exactly what NSA spokesman Vanee Vines told the Intercept.

The fact that NSA or State Department did not deny the allegations is telling.

On Tuesday, Chinese Foreign Ministry spokeswoman Hua Chunying said in Beijing that she has seen the report but was not aware of the specifics.

New Zealand Considers Role on ISIS

By Helen Clark
February 21, 2015

Amid opposition, the country contemplates joining the coalition in the Middle East. 

New Zealand’s defense chief, Lieutenant General Tim Keating, is currently in Saudi Arabia for talks on fighting ISIS.

New Zealand is not part of the coalition fighting the group, unlike allies Australia and the United States, and it has made no public decisions to join but, said Keating, “it makes sense that there’s New Zealand Defence Force representation at such a meeting… it will be a good opportunity to receive updates on the situation.” Prime Minister John Key has told reporters that the decision whether or not to send troops would most likely be made Monday.

There is not full support, even among conservatives such as the Nationals partners, for sending troops overseas. Maori Party co-leader Marama Fox said, “Training troops in Iraq and places like that have in the end turned sour on those countries that have done that.” She did agree to humanitarian aid and peacekeeping, however. Key previously ruled out the idea of Kiwi troops in combat roles, restricting them to training.

Internal Affairs Minister Peter Dunne is also against the training of Iraqi troops, saying, “All they’ve done is create an ongoing festering sore which is now rampant, if you like, right through the Middle Eastern region… I mean it didn’t work in the Crusades and yet these are the modern day versions of that.” He said the idea of New Zealand joining just to be part of the Western club was not a good one. Iraq has formally requested military aid from New Zealand, however, so it is not simply a case of Kiwis following their closest security ally Australia blindly into battle. Defence Minister Gerry Brownlee has issued a statement saying essentially that given the close relationship between Australia and New Zealand it was important to share views on security and defense.

New Zealand recently took up a position on the UN Security Council this year and has been involved in issues in the Middle East. Possibly unusually, it disagreed with Australia’s veto on Palestinian statehood, saying New Zealand would either have agreed or abstained from the vote.

Barack Obama Is Not a Muslim

He should stop trying to interpret Islam. 

U.S. President Barack Obama speaks during the White House Summit on Countering Violent Extremism at the State Department in Washington, D.C., on Feb. 19, 2015.

On Sept. 17, 2001, shortly after the 9/11 terror attacks, President George W. Bush declared that “these acts of violence violate the fundamental tenets of the Islamic faith, and it’s important for my fellow Americans to understand that.” According to Bush, “the face of terror is not the true face of Islam,” because “Islam is peace.” To Americans who feared that Muslims would face violent reprisals in the wake of the attacks, Bush’s words were welcome. Yet there was something awkward about the fact that the president, by all accounts a devout Christian, had decided not only to say that our Muslim fellow citizens ought to be treated with respect, but also that those who’d commit such a horrific crime had—and here Bush literally quoted from the Quran—“rejected the signs of Allah and held them up to ridicule.”

No one should doubt Bush’s good intentions in describing Islam as a religion of peace. But by invoking Islamic scripture, and by weighing in on a debate that can only be settled by those who identify as Muslims themselves, he contributed to a confusion that persists today. The real problem with people who kill innocent people in the name of Islam is not that they’re incorrectly interpreting their faith. It’s that they are killing innocent people.

Why do the leaders of ISIS have to be insincere in their beliefs in order for us to reject their brutality? 

Like Bush, President Obama has weighed in on matters that must ultimately be left up to Muslims. Take his remarks this Wednesday, when he said, quite rightly, that “we are not at war with Islam.” Not content to stop there, or to simply explain that we are at war with various apocalyptic death cults that have declared war on us, he added that “we are at war with people who have perverted Islam.”

In great detail, Obama explained that ISIS, also known as the Islamic State, and other extremist groups seek religious legitimacy in order to recruit young people to their cause, and that they “depend upon the misperception around the world that they speak in some fashion for people of the Muslim faith.” According to Obama, these groups base their claims to legitimacy on falsehoods and selective readings of Islamic texts. Obama’s position seems to be that the leaders of these groups aren’t sincere in their beliefs. He suggests that what ISIS is really after is power, as if its obsessive focus on acting in accordance with practices that were widespread in the days of Muhammad is merely window-dressing for thuggery and theft. But why do the leaders of ISIS have to be insincere in their beliefs in order for us to reject their brutality?

Paul Rogers' Monthly Briefing: Is Islamic State in Retreat?

This briefing looks at two unrelated incidents in the first weeks of 2015, in France and Syria, as indicative of major developments in the evolution of extreme Jihadist movements and that are likely to have long term effects. The Charlie Hebdo murders will lead to much more intensive counter-terror procedures in France and in greater security services cooperation across Europe but these also risk stimulating a further rise in the anti-Islamic mood. The execution of the young Jordanian pilot, Flight Lieutenant Moaz al-Kasasbeh by Islamic State (IS) in Syria looked initially to increase the resolve of regional states to confront IS. However, it is far from clear that recent suggestions that IS is more generally on the defensive are accurate.
Charlie Hebdo

On 7 January, two French brothers of Algerian descent, Saïd and Chérif Kouachi, entered the central Paris offices of the French satirical magazine Charlie Hebdo and opened fire on an editorial meeting, killing 12 people. In an apparently coordinated attack, hostages were later held at a Parisian kosher supermarket. Four customers and another police officer were killed by Amedy Coulibaly, an apparent associate of the Kouachi brothers. By the time the three attackers were killed in sieges on 9 January, France had deployed an estimated 80,000 police, army and other security personnel in response.

Although Charlie Hebdo was a low circulation magazine, it was a part of French political culture and represented that strand, more prominent in France than in most European countries, of vigorous political lampooning, sometimes close to the obscene. The attack was viewed immediately as an assault on freedom of expression and the response included the biggest public demonstrations of support on any issue in France for decades and stoked intense debates across Europe on what is and is not permissible.

Islam in Europe

Islam in Europe Jan 7th 2015

THE brutal murder of 12 people at the offices of a satirical magazine in Paris today appears to have been carried out by militant Islamists. If so, many will again question the compatability of Islam with secular-minded, liberal European values. Mistrust of religion is not confined to Islam, but Europeans regard it as more threatening to their national cultures than other faiths (or indeed atheism), according to a 2013 poll by the Bertelsmann Foundation, a non-profit organisation in Germany. The threat of Islamic terrorism is rising, to judge not just by today's slaughter but also by other attacks and a recent upward trend in arrests for religiously-inspired terrorism reported by Europol, the European Union's law-enforcement arm. Perceptions can easily run ahead of reality, however. There were still more arrests for other types of terrorism (motivated by separatism, for example) in Europe in 2013, the last year for which pan-European data are available. And European publics wildly overestimate the proportion of their populations that is Muslim: an Ipsos-Mori poll in 2014 found that on average French respondents thought 31% of their compatriots were Muslim, against an actual figure closer to 8%.

Douglas MacArthur and the Pivot to Asia

By Francis P. Sempa
February 22, 2015

The controversial general would have applauded the U.S. commitment to the Asia-Pacific. 

Douglas MacArthur is known as a brilliant and controversial general, but not as a geopolitical visionary. Throughout his lengthy and distinguished military career, however, MacArthur envisioned geopolitical factors that he believed would result in a U.S. pivot to the Asia-Pacific region.

In April 1904, shortly after MacArthur graduated from the United States Military Academy at West Point, he accompanied his father, Lieutenant General Arthur MacArthur, Jr., on an official tour of Asia. General Arthur MacArthur, who won the Medal of Honor as a 19-year-old lieutenant in the Union Army during the American Civil War and who had commanded U.S. forces in putting down the Philippine insurrection, was in Japan to observe the Russo-Japanese War. Douglas recalled in his memoirs, Reminiscences, that he and his father traveled from Japan to Hong Kong, Singapore, Rangoon, Calcutta, Peshwar, Quetta, Bombay, Hyderabad, Bangalore, Madras, Colombo, Java, Siam, Indochina, and Shanghai. “We were nine months in travel,” MacArthur wrote, “traversing countless miles of lands so rich in color, so fabled in legend, so vital to history that the experience was without doubt the most important factor of preparation in my entire life.” He continued:

The true historic significance and the sense of destiny that these lands of the western Pacific and Indian Ocean now assumed became part of me. They were to color and influence all the days of my life. Here lived almost half the population of the world, with probably more than half of the raw products to sustain future generations. Here was western civilization’s last earth frontier. It was crystal clear to me that the future and, indeed, the very existence of America, were irrevocably entwined with Asia and its island outposts.

After distinguished service with the army in Mexico and having commanded the famous Rainbow Division in France during the First World War, and following a stint as superintendent at West Point, MacArthur in October 1922 arrived in Manila where he served as commander of the Military District of Manila, the Philippine Scout Brigade, and later the 23rd Infantry Brigade of the Philippine Division. In the mid-1920s, he was back in the continental United States where he participated in the court-martial of pioneering airman Billy Mitchell, served as president of the U.S. Olympic Committee, and returned to the Philippines as commander of all U.S. Army forces on the islands.

Syriza’s scattergun

Greece had a chance to make the euro zone work better. It blew it Feb 21st 2015 

CLIP-CLOPPING around Europe over the past few weeks, Yanis Varoufakis, Greece’s dashing finance minister, has urged the euro zone to chart a new course. Endlessly forcing new loans upon indebted countries like Greece in the pretence that they will one day be repaid, he argued, was a strategy for depression and deflation. “The disease that we’re facing in Greece,” he told the BBC, “is that a problem of insolvency for five years has been treated as a problem of liquidity.”

This view would not seem outlandish in the academic world that Mr Varoufakis recently quit. Few believe that Greece’s debts, worth over 175% of GDP, will ever be repaid in full. But saying so betrayed a woeful misunderstanding of the euro zone’s rules. If the European Central Bank shared Mr Varoufakis’s view, it would have to cut off Greek banks, potentially driving Greece out of the euro. Indeed, earlier this month, when the minister visited the ECB in Frankfurt, Mario Draghi, its president, snippily told him to keep his opinion to himself. He has not repeated it since.

Mr Varoufakis’s gaffe is a mere footnote in a list of mishaps that have characterised Greece’s miserable experience in the euro. But it is depressingly typical for a government that, for all its high popularity at home, has squandered every opportunity to improve its lot, and ultimately that of the euro zone. Even as Mr Varoufakis and his colleagues in Greece’s ruling Syriza party have loftily declared that the changes they seek would benefit all Europeans, not just Greeks, their negotiating strategy has been small-minded, self-defeating and naive.

Some of this may be put down to inexperience. A few Europeans were guilty of assuming that Alexis Tsipras, the prime minister, would perform what Greeks call a kolotoumba(“somersault”) the instant he took office. But Syriza has no excuse for making idle references to the Nazi occupation of Greece. Nor has it helped by playing games with its partners in the Eurogroup of finance ministers. European officials have been incensed by a Hellenic habit of leaking supposedly private discussion papers.

The wrangling over whether to extend Greece’s second bail-out, which expires on February 28th, has shown Mr Tsipras’s government at its worst. Admittedly Syriza was dealt a bad hand by its predecessor, which before Christmas accepted an extension of only two months. But rather than accept an extension, Mr Tsipras and Mr Varoufakis have dug in their heels, robotically insisting on a “bridging” deal that would unlock euro-zone funding while allowing the government to slow or reverse reforms. Greece’s creditors, unsurprisingly, were unimpressed. On February 19th Greece put forward a more conciliatory proposal to extend its loan. But this was almost immediately rebuffed by Germany. Trust has seemingly been so grievously eroded that Greek promises of discipline are not worth much in Berlin.

The Daily Lives of Russians, as Seen on the Silver Screen

Posted by Samuel Bendett 
February 22, 2015

Today American audiences will be treated to the Oscars Awards. Among the nominations for a best foreign language film is the Russian motion picture "Leviathan," a hard-hitting, bleak and depressing film about one man's futile struggle against corrupt city government. Russian authorities, and many in Russian society, have condemned the film as an unfair and biased representation of the country. In fact, it has been decried as "anti-Russian propaganda" at a time when Moscow is engaged in a struggle of ideas with the West over the conflict in Ukraine. Indeed, "Leviathan" could carry the day at the Oscars as a political statement against Moscow. If that happens, it wont be the first time a Russian film has caught the world's attention.

Sincere portrayals

Russia for its honest portrayal of a corrupt mayor who is willing to steamroll a regular citizen to get his way. The protagonist in the film has very little ammunition to fight such tactics, no matter how much he wishes to stay within the limits of Russian law. This happens regularly across Russia, as the laws and principles governing private property and individual freedom have remained in flux, and are pitted against the Russian state's growing role in practically every aspect of life. In other words, the film showed Russia as it is, rather than Russia as it wishes to be seen.

North Korea’s New Anti-Ship Missile: No Cause for Alarm

By Nah Liang Tuang
February 23, 2015

The successful missile test is a development of note, but not of alarm. 

On February 8, 2015, North Korea test fired five of what it termed “cutting edge” anti-ship missiles. Strategic political analysis would indicate that the date of the test firing holds more significance, as Pyongyang has chosen to showcase its latest naval armament upgrade a few weeks before annual U.S.-ROK military exercises, which the former regards as invasion rehearsals. While the missile testing was conducted to convey Pyongyang’s displeasure to Washington and Seoul, the successful testing of anti-ship missiles at a range of 200 km, as reported by South Korea’s defense ministry, is a development of note but not of alarm.

No ‘Silver Bullet’

According to knowledgeable analysts, the DPRK’s latest weapon appears to be a Russian Kh-35 anti-ship missile, which the North Koreans christen the “KN-09” and claim as their own. Assuming that the KN-09 shares the same technical and performance specifications as the Kh-35, whether as a renamed Russian import or a reverse engineered copy, it can be argued that the DPRK’s newest anti-ship missile is an attempt at economical force modernization rather than a “silver bullet” to counteract ROK naval superiority.

Considering the missile inventory of the Korean People’s Navy (KPN), we can see that its earlier anti-ship missiles ranging from the Soviet SS-N-2 Styx to the Chinese Silkworm and CSS-N-8 Saccade were developed from the 1950s to the late 1980s, and could be considered outdated. With the introduction of the KN-09 or Kh-35, the DPRK now has a modern missile which was deployed in Russian service as recently as 2003.

When making the case for KN-09 deployment as a force modernization measure, rather than as a short cut to negating South Korean naval preponderance, it would help to compare the characteristics and capabilities of the Kh-35/KN-09 with the American made Harpoon anti-ship missile used by the ROK navy. Examining the latest versions of both missiles, we can see that they have similar ranges (260 vs 278 km), are guided by onboard inertial navigation and active radar homing, are sea skimming (to reduce detection probability) while being day/night capable, and even have similar warhead weights and speeds (0.8 vs 0.7 Mach).

Cambodia’s Garment Industry Rollercoaster

By Peter Ford
February 22, 2015

News for the vital industry has been decidedly mixed of late. 

Travel in any direction from Phnom Penh, Cambodia’s capital, and it is not long before you reach the clothing and footwear factories. Lining the national highways, these buildings – often resembling warehouses in both size and architectural merit – house up to 600,000 workers, predominately young women. Time your trip for the beginning or end of a shift, and the sight of thousands of these women crammed into open top cattle trucks starkly highlights both the youth of the workers, and the huge numbers involved in this industry.

The importance of the garment industry to Cambodia’s economic output is clear: $5.7 billion in clothing and footwear was exported last year, and is a major factor in the country’s official zero percent unemployment rate. Yet despite this it can sometimes feel as if garment workers never catch a break. Stories featuring the Kingdom’s seamstresses in the past few years have covered mass fainting, mass strikes, and the police shooting of five workers. Indeed, positive stories are hard to find.

In the past few months, though, there have been a number of developments.

The announcement in November 2014 that the minimum wage for garment and footwear workers would rise 28 percent to $128 a month was a rare piece of good news for workers. Facing strong resistance from employers and the government alike, the increase served as a strong reminder of the importance of the sector to the government, not to mention the power of the unions involved. The recent tightening of union registration laws might be a sign of just how strong this message was.

While this was a significant increase, it fell far short of the $160 demanded by the unions, and has done little to quell the underlying anger, as the sporadic subsequent strikes have shown.

Also in November was the widely reported broadcasting of a Norwegian reality TV show titled Sweatshop.Three young fashion-obsessed Norwegians (one admits to spending $600 a month on new clothes) travel to Cambodia to briefly experience the daily realities of the people making their clothes. Subtitled “this is what happens when you send three young Norwegians abroad,” it provided classic emotive material, with smiles and naïve comments slowly replaced with copious tears and comments on social injustice.

A Dangerous Game: Russian Debt Roulette

February 22, 2015 

Russia's economic situation is dire. Can Moscow pull through?

Russia’s economy is dependent on oil and gas. Hydrocarbons are responsible for roughly 70 percent of Russian exports and, directly and indirectly, for almost 80 percent of the Russian federal budget. The recent downfall of oil prices, along with the isolation from Western capital markets following the Russian annexation of Crimea and support for separatists in eastern Ukraine, has severely damaged Russia’s economic situation. Stagnation turned into recession, the ruble devalued and inflation became double-digit. It all made the situation inflammable, and an unexpected and unexplained decision of the Central Bank to raise the prime rate from 10.5 percent to 17 percent overnight immediately caused brief but powerful panic among consumers and in securities markets. It allowed many analysts to derive apocalyptic predictions, including the forecasting of problems with sovereign and corporate currency-denominated debt repayments.

Rating agencies have been much more cautious. While recently reassessing their forecasts for Russian ratings, they argued that “the probability of default is still very low.” In the latest move, S&P downgraded Russia’s sovereign rating to below investment-grade level (BB+); however, this rating level corresponds to circa 1.5 percent default probability. For comparison, Turkey and Indonesia also have BB+ S&P ratings; both are considered to be healthy economies with high potential.

Russian securities markets reacted more nervously, and yields of Russian short-term sovereign bonds rose twofold, while credit default swaps reached 500 bps, while CDS for Turkey is almost one third of Russian level. Still, such levels look much more like the ones in the summer of 2011 (when the price of oil was rising and Mr. Putin had neither cracked down on the opposition, nor invaded Ukraine, and when the idea of Russia defaulting would have seemed utterly implausible) than like the pre-default ones.

A quantitative exercise is a helpful, if perhaps slightly boring, way to understand the exact picture. Out of the $525 bln of Russia’s total exports in 2013, over $300 bln were oil- and gas-related. The price of oil fell from the average for 1H 2014 of $109 per barrel to $60, and, provided it remains at that level, Russian exports in 2015 will fall some $180 bln down to $340 bln, or, as the gas volumes are set to fall as well, even lower.

The Global Stakes of the Ukraine Crisis. The Failure of Western Civilization

February 20, 2015

War party bigotry and hate may be enough to drive neo-Nazis leading Kiev in the Ukraine civil war. But the reverse blame of Putin and Russia by corporate media and states has a deeper interest. It propels the geostrategic economic and military war of movement through East Europe to Russia. It is the indispensible big lie to mask their set up for foreign financial predation. A big pay-off matrix looms in Ukraine for US-led arms corporations and military services, agribusiness and GMO’s, speculator funds on debts and currency, monopoly providers of privatized social services, Big Oil frackers for newly discovered rich deposits, junk food suppliers like Poroshenko in US-frankenfood alliance, and – last but not least – the IMF money party waging a war of dispossession by financial means. 

The IMF enforces the global money-sequence cancer system by its defining policy commands on debt-impoverished countries to open them up to foreign feeding on their domestic markets and fire-sale enterprises, drastically reduced workers’ wages and benefits, stripped public pensions, healthcare and education, sell-off of historic infrastructures to pay ever more bank-created debts, and – in general- multiplying transnational money demand and profit invading their life functions at all levels. The IMF and Wall Street have been cumulatively hollowing out Africa, Latin America, South-East Asia, South Europe and the US itself in these ways over 35 years. Now it is the turn of the once social democratic Europe, state by state, beginning with the most indebted and helpless. Ukraine on the outskirts of Europe next to Russia is where the military option has been required to strip it and its former Slavic economic union with Russia. This historic relationship has been the last line of life defence in the way, a conservative but sharing ethos of resource-rich societies with Putin as a superior leader facing the US-EU’s many-times more powerful economic levers and lethal arms to bully him and Russia into submission.

To take the naturally rich Ukraine for transnational bank and corporate looting, the public must be sold the story of Putin as the villain. Only then can debt screws be applied and the country opened to long-term and full-spectrum financial, foreign and oligarch control beneath the people’s notice. The IMF is already in motion to ensure that the Kiev coup state provides all of this. Few observe the underlying fact that the crushing bank debt eating societies alive across the world is all debt money created by big private banks with no legal tender to back 97% of it. Ukraine is the latest nation to fall into the deadly trap without a sound. Here public money for public need is ended, although it created the US itself. As Ben Franklin has testified, to regain public money issue was the prime reason for the American Revolution. Public banking was also what made modern Canada from 1938 to 1974 by public investment money without private debt-servicing loaned by the public Bank of Canada for construction of Canada’s material and social infrastructures from the St Lawrence Seaway to public pensions and universal healthcare.