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Eyewitness From Gaza
Niebyl-Proctor Library, Oakland
Wednesday February 18th, 2009, 7:00 PM
Report From Gaza 2009-02-18 7:00 PM Darlene Wallach and Donna Wallach are anti-zionist social justice activists. Last August they travelled to Gaza Strip, Palestine onboard the SS Liberty and SS Gaza Strip of the Free Gaza movement, the first boats to arrive to Gaza from Cyprus in 41 years. They recently returned from Gaza after volunteering with International Solidarity Movement (ISM) accompanying Palestinian fishermen and Palestinian farmers and witnessing daily violations of the ceasefire by Israeli military. For 15 years 1981 - 1997 Donna lived inside the 1948 borders of Historic Palestine, better known as Israel. She learned first hand the extremely racist nature of Zionism and the Apartheid State of Israel, which led to her anti-zionist stance. Darlene had spent almost two months in Palestine in 2002 most of that time fighting deportation after witnessing collective punishment of Palestinians in Gaza Strip and the West Bank. Since arriving to the Bay Area in 1997 she and her sister have organized and worked collectively with grassroots groups to educate the public about Mumia Abu-Jamal, Leonard Peltier, Hugo "Yogi Bear" Pinell, Ruchell Cinque Magee, police terrorism, the security housing units in the prisons, and Palestine and the Palestinian people. They are passionate about justice and equality for all. Come listen to them speak about the spirit, resilience, kindness, generousity, and sense of humor of the Palestinian people and the peaceful ways they survive the extreme hardships of Israeli blockade and violence.
Location: NPML 6501 Telegraph Ave. Oakland, CA 94609
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MASS COMMUNITY OUTREACH TO BUILD MARCH 21
SATURDAY, FEBRUARY 21, 11:00 A.M.
CENTRO DEL PUEBLO (UPSTAIRS)
474 VALENCIA STREET (NEAR 16TH STREET)
SAN FRANCISCO
NEXT MARCH 21 COALITION PLANNING MEETING:
SUNDAY, MARCH 1, 2:00 P.M.
CENTRO DEL PUEBLO (UPSTAIRS)
474 VALENCIA STREET (NEAR 16TH STREET)
SAN FRANCISCO
Check out the new MARCH 21 Coalition Website
(An extensive endorsement list is posted here):
http://www.pephost.org/site/PageServer?pagename=M21_homepage
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National Assembly to End the Iraq and Afghanistan Wars and Occupations
CALL FOR ENDORSEMENTS FOR MARCH 21:
Greetings:
The March on the Pentagon and the demonstrations in San Francisco, Los Angeles and other cities scheduled for Saturday, March 21 - marking the beginning of the 7th year of war and occupation of Iraq - are now only weeks away. This is a time for peace activists across the country to go all-out in helping to publicize and build these actions. You can start by endorsing March 21, if you and your organization have not done so already.
A mass movement in the streets is needed now more than ever if we are to succeed in getting U.S. troops out of Iraq and Afghanistan, ending U.S. support for Israel's occupation of Palestine, preventing further attacks on Pakistan, and stopping a war against Iran. The occupation of Iraq continues with every indication that the new administration intends to stay there indefinitely. Meanwhile, 30,000 additional U.S. troops are to be sent to Afghanistan. The whole world watched with horror as Israel massacred thousands of Palestinians in Gaza, using weapons of mass destruction provided by Washington. And only days after the inauguration, orders were given to bomb Pakistan, resulting in 21 deaths, most of them women and children.
March 21 provides concerned people throughout the country an opportunity to let the world know that opposition to these U.S. policies of war, occupation, intervention and expansionism exists and is determined to be heard. It lets the beleaguered people in those countries where the U.S. is an oppressor know that there is an American antiwar movement that does not forget their needs for peace and national sovereignty. That is a message we must also send to the new administration. The size of the turnout on the 21st will be critical if we are to help make a difference. So we count on you to do whatever you can to build highly visible mass actions and to ensure that they are as large, vocal and spirited as possible.
There are March 21 committees and coalitions already formed or being formed in many areas working to publicize the event and send people to one of the demonstration sites. We encourage you to join or organize such a grouping in your locale. The National Assembly, as one of many initiators of March 21, is going all out to make the actions as large as possible.
Please send endorsements to our website at www.natassembly.org, where an endorsement form is provided, or by writing natassembly@aol.com. While we would like to have these endorsements for our records so that we can keep everyone updated regarding National Assembly activities, we will also forward them to the March 21 National Coalition website at www.PentagonMarch.org, where the latest list of endorsers can be viewed.
In solidarity,
Jerry Gordon
Secretary, National Assembly to End the Iraq and Afghanistan Wars and Occupations
NATIONAL ASSEMBLY
www.natassembly.org
216-736-4704 for more info
P.S. Check out the National Assembly website to see our statement on Gaza, get information on March 21st organizing, learn about our July 10-12 national antiwar conference in Pittsburgh, make a donation, and participate in our discussion blog.
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GENERAL ANNOUNCEMENTS
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Wall Street Executive Air
http://www.markfiore.com/
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Mumia Abu-Jamal, death row - U.S. Supreme Court
Legal Update
Robert R. Bryan, lead counsel
February 8, 2009
RobertRBryan@aol.com
New case filing in Supreme Court On February 4, 2009, the U.S. Supreme Court docketed and accepted for filing the Petition for Writ of Certiorari, with supporting Appendix, that I had submitted December 19, 2008 on behalf of Mumia Abu-Jamal. (AbuJamal v. Beard, U.S. Sup. Ct. No. 08-8483.) A copy of the petition is attached. The central issue in this case is racism in jury selection. The prosecution systematically removed people from sitting on the trial jury purely because of the color of their skin, that is, being black. The bigotry that killed Martin Luther King, Jr., so many years ago, has been rampant in the case of my client and is a central part of the state's quest to murder him in the name of the law.
Prosecution's separate Supreme Court petition In an entirely separate case (Beard v. Abu-Jamal, Sup. Ct. No. 08-652), the prosecution is seeking to overturn the victory we achieved last year in the U.S. Court of Appeals for the Third Circuit. (Abu-Jamal v. Horn, 520 F.3d 272 (3rd Cir. 2008).) In that ruling the court ordered a new jury trial on the question of the death penalty. Our Brief In Opposition will be filed in the Supreme Court on February 13, 2009.
Donations for Mumia's Legal Defense The legal defense for Mumia needs help. The costs for our litigation in two case before the Supreme Court are substantial. To help, please make your checks payable to the "National Lawyers Guild Foundation" (indicate "Mumia" on the bottom left). The donations are tax deductible, and should be mailed to:
Committee To Save Mumia Abu-Jamal
P.O. Box 2012
New York, NY 10159-2012
Conclusion Mumia remains on Pennsylvania's death row. We are in an epic struggle in which his life hangs in the balance. What occurs now in the Supreme Court will determine whether Mumia will have a new jury trial, or die at the hands of the executioner.
As I have previously pointed out, Mumia is in greater danger than at any time since his 1981 arrest. Your support and activism is needed. This great journalist and author does not belong on death row or in prison. We must not rest until he is free.
Yours very truly,
Robert R. Bryan
Law Offices of Robert R. Bryan
2088 Union Street, Suite 4
San Francisco, California 94123-4117
Lead counsel for Mumia Abu-Jamal
[E-mail: RobertRBryan@aol.com]
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Israel-Palestine: A Land in Fragments
A film by American Friends Service Committee (AFSC)-- 2 minutes
http://www.youtube.com/watch?v=6ewF7AXn3dg
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Resolution regarding an IVAW Position Statement on Afghanistan
http://ivaw.org/afghanistan/resolution
Whereas, Iraq Veterans Against the War is an organization that has opened its membership to veterans of the war in Afghanistan;
Whereas, the war in Afghanistan is continuing into its seventh year with rising casualties among the Afghan people, and with U.S. and Coalition forces facing their deadliest year since the invasion;
Whereas a primary motivation for the prolonged occupation of Afghanistan is competition between the U.S., Russia and China for control of oil and natural gas resources in Central Asia and the Caspian Sea;
Whereas, the military occupation is creating tension and resentment among the Afghan people, to include Afghan women, many of whom are calling for the removal of all foreign occupying troops;
Whereas, the Afghanistan war dehumanizes the Afghan people and denies them their right to self-determination;
Whereas, our military is being exhausted by involuntary extensions, and activations of the Reserve, National Guard and Individual Ready Reserve, and by repeated deployments to Iraq and Afghanistan;
Whereas, service members are facing serious health consequences due to our government's negligence in Iraq and Afghanistan and mismanagement of the Department of Veterans Affairs;
Whereas, there is no battlefield solution to terrorism, and any escalation of the war in Afghanistan will only serve to exacerbate the plight of the Afghan people, destabilize the region, and further the breakdown of our military;
Therefore, be it resolved that Iraq Veterans Against the War calls for the immediate and unconditional withdrawal of all occupying forces in Afghanistan and reparations for the Afghan people, and supports all troops and veterans working towards those ends.
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RESISTING INDIVIDUAL READY RESERVE (IRR) RECALL
Courage to Resist.
Dear Friends,
Courage to Resist has published an IRR overview that contains critical
information for anyone nearing the end of their military enlistment and the
hundreds of thousands of recently discharged veterans still eligible for
involuntary recall. I don't believe this information exists anywhere else,
so I'm hoping you might be able to help distribute, link and share this as
broadly as possible so that those who need it the most might find it.
Jeff Paterson
Courage to Resist Project Director
RESISTING INDIVIDUAL READY RESERVE (IRR) RECALL
Courage to Resist.
Online version:
http://couragetoresist.org/x/content/view/658/1/
PDF leaflet:
http://couragetoresist.org/x/images/stories/pdf2/irr-leaflet.pdf
Additional related IRR information from Courage to Resist:
http://couragetoresist.org/irr
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ARTICLES IN FULL:
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1) Rise in Jobless Poses Threat to Stability Worldwide
By NELSON D. SCHWARTZ
February 15, 2009
http://www.nytimes.com/2009/02/15/business/15global.html?hp
2) U.S. Airstrike Kills 30 in Pakistan
By PIR ZUBAIR SHAH
February 15, 2009
http://www.nytimes.com/2009/02/15/world/asia/15pstan.html?hp
3) British Officers in '05 Killing in Subway Won't Be Charged
By JOHN F. BURNS
February 14, 2009
http://www.nytimes.com/2009/02/14/world/europe/14britain.html?ref=world
4) 100,000 Parents of Citizens Were Deported Over 10 Years
By MICHAEL FALCONE
February 14, 2009
http://www.nytimes.com/2009/02/14/us/14immig.html?ref=us
5) Coal Industry Wins a Round on Mining
By ANDREW C. REVKIN
February 14, 2009
http://www.nytimes.com/2009/02/14/science/earth/14mountain.html?ref=us
6) Economic Confidence Continues to Fall
By REUTERS
February 14, 2009
http://www.nytimes.com/2009/02/14/business/economy/14econ.html?ref=business
7) Inquiry on Graft in Iraq Focuses on U.S. Officers
By JAMES GLANZ, C.J. CHIVERS and WILLIAM K. RASHBAUM
February 15, 2009
http://www.nytimes.com/2009/02/15/world/middleeast/15iraq.html?hp
8) U.S. Military Will Offer Path to Citizenship
""We're going to give people the opportunity to be part of the United States who are dying to be part of this country and they weren't able to before now," said Sergeant Campos, who was born in the Dominican Republic and became a United States citizen after he joined the Army."
By JULIA PRESTON
February 15, 2009
http://www.nytimes.com/2009/02/15/us/15immig.html?ref=world
9) Killing Stirs Racial Unease in Texas
By JAMES C. McKINLEY Jr.
February 15, 2009
http://www.nytimes.com/2009/02/15/us/15paris.html?ref=us
10) Economic Lessons From Lenin's Seer
By KYLE CRICHTON
February 15, 2009
http://www.nytimes.com/2009/02/15/weekinreview/15crichton.html?ref=business
11) Decade at Bernie's
By PAUL KRUGMAN
Op-Ed Columnist
February 16, 2009
http://www.nytimes.com/2009/02/16/opinion/16krugman.html
12) Economists' Forecast: Chance of Change 100%
By DAVID W. CHEN
February 16, 2009
http://www.nytimes.com/2009/02/16/nyregion/16york.html?ref=nyregion
13) Finance Capitalism Hits a Wall
The Oligarchs' Escape Plan
The U.S. giveaway to banks, masquerading as "help for troubled homeowners"
By MICHAEL HUDSON
February 17, 2009
http://www.counterpunch.com/hudson02172009.html
14) Union Talks Seen as Key as G.M. Makes Case for Funds
By BILL VLASIC and NICK BUNKLEY
February 17, 2009
http://www.nytimes.com/2009/02/17/business/economy/17auto.html?hp
15) Afghan Civilian Deaths Rose 40 Percent in 2008, U.N. Says
By ALAN COWELL
February 18, 2009
http://www.nytimes.com/2009/02/18/world/asia/18afghan.html?ref=world
16) For Education Chief, Stimulus Means Power, Money and Risk
By SAM DILLON
February 17, 2009
http://www.nytimes.com/2009/02/17/education/17educ.html?ref=education
17) Resisting Home Evictions Becomes a Group Effort
By FERNANDA SANTOS
February 18, 2009
http://www.nytimes.com/2009/02/18/nyregion/18foreclose.html?scp=1&sq=Resisting%20Home%20Evictions%20Becomes%20a%20Group%20Effort&st=cse
18) A 'fraud' bigger than Madoff
Senior US soldiers investigated over missing Iraq reconstruction billions
By Patrick Cockburn in Sulaimaniyah, Northern Iraq
The Independent (UK)
February 16, 2009
http://www.independent.co.uk/news/world/americas/a-fraud-bigger-than-madoff-
1622987.html
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1) Rise in Jobless Poses Threat to Stability Worldwide
By NELSON D. SCHWARTZ
February 15, 2009
http://www.nytimes.com/2009/02/15/business/15global.html?hp
PARIS - From lawyers in Paris to factory workers in China and bodyguards in Colombia, the ranks of the jobless are swelling rapidly across the globe.
Worldwide job losses from the recession that started in the United States in December 2007 could hit a staggering 50 million by the end of 2009, according to the International Labor Organization, a United Nations agency. The slowdown has already claimed 3.6 million American jobs.
High unemployment rates, especially among young workers, have led to protests in countries as varied as Latvia, Chile, Greece, Bulgaria and Iceland and contributed to strikes in Britain and France.
Last month, the government of Iceland, whose economy is expected to contract 10 percent this year, collapsed and the prime minister moved up national elections after weeks of protests by Icelanders angered by soaring unemployment and rising prices.
Just last week, the new United States director of national intelligence, Dennis C. Blair, told Congress that instability caused by the global economic crisis had become the biggest security threat facing the United States, outpacing terrorism.
"Nearly everybody has been caught by surprise at the speed in which unemployment is increasing, and are groping for a response," said Nicolas Véron, a fellow at Bruegel, a research center in Brussels that focuses on Europe's role in the global economy.
In emerging economies like those in Eastern Europe, there are fears that growing joblessness might encourage a move away from free-market, pro-Western policies, while in developed countries unemployment could bolster efforts to protect local industries at the expense of global trade.
Indeed, some European stimulus packages, as well one passed Friday in the United States, include protections for domestic companies, increasing the likelihood of protectionist trade battles.
Protectionist measures were an intense matter of discussion as finance ministers from the Group of 7 economies met this weekend in Rome. [Page A16.]
While the number of jobs in the United States has been falling since the end of 2007, the pace of layoffs in Europe, Asia and the developing world has caught up only recently as companies that resisted deep cuts in the past follow the lead of their American counterparts.
The International Monetary Fund expects that by the end of the year, global economic growth will reach its lowest point since the Depression, according to Charles Collyns, deputy director of the fund's research department. The fund said that growth had come to "a virtual halt," with developed economies expected to shrink by 2 percent in 2009.
"This is the worst we've had since 1929," said Laurent Wauquiez, France's employment minister. "The thing that is new is that it is global, and we are always talking about that. It is in every country, and it makes the whole difference."
In Asia, any smugness at having escaped losses on American subprime debt has been erased by growing despair over a plunge in sales among major exporters. On Thursday, Pioneer of Japan said it would abandon the flat-screen television business and cut 10,000 jobs worldwide in response to sagging demand for consumer electronics.
Millions of migrant workers in mainland China are searching for jobs but finding that factories are shutting down. Though not as large as the disturbances in Greece or the Baltics, there have been dozens of protests at individual factories in China and Indonesia where workers were laid off with little or no notice.
The breadth of the problem is also becoming apparent in Taiwan, where exports were down 42.9 percent last month, compared with a year ago, the steepest plunge in Asia.
Chang Yung-yun, a 57-year-old restaurant kitchen worker, was laid off when her employer closed in mid-November. Her son, an engineer, has been put on unpaid vacation for weeks, a tactic that has become common in Taiwan.
"The greatest fear for our people is losing jobs," Taiwan's president, Ma Ying-jeou, said in an interview.
Calls for protectionism have resonated among a fearful public. In Britain, refinery and power plant employees walked off the job last month to protest the use of workers from Italy and Portugal at a construction project on the coast. Some held up signs highlighting Prime Minister Gordon Brown's earlier promise of "British jobs for British workers."
Unemployment in Britain is expected to rise to 9.5 percent by the middle of 2010, from 6.3 percent now, according to Peter Dixon, an economist with Commerzbank in London. Germany's jobless rate could rise to 10.5 percent from 7.8 percent, he added.
In France last week, President Nicolas Sarkozy agreed to supply low-interest loans of 3 billion euros, or $3.86 billion, each to PSA Peugeot Citroën and Renault in exchange for an agreement not to lay off French workers.
To a greater extent than in past European downturns, highly trained white-collar workers are pounding the pavement, too. Naomi Runquist-Ohayon, a trademark lawyer, has been looking for work in Paris since the beginning of the year, after losing her job in December.
"This is a new experience for me," said Ms. Runquist-Ohayon, 39, a Swedish native who has lived in Paris and London and speaks fluent English, French, Swedish and Italian. "In London, I never had to really look. Recruiters or headhunters would call me or I would call them. It's not so easy now."
Half a world away in Colombia, Jaime Galeano, 40, is in a similar predicament. As a bodyguard in a country notorious for drug-related violence and kidnappings, Mr. Galeano thought his profession was immune until he lost his job last year.
"The conditions for finding a job are terrible," he said. What is more, his age is now an impediment, with a ministry informing him that only applicants under the age of 32 would be considered for new positions.
"After turning 35, a person is worth nothing," Mr. Galeano said.
Even India, whose startling rise to the forefront of the global economy was portrayed in the hit movie "Slumdog Millionaire," has hit a wall. About 500,000 people lost jobs between October and December 2008, according to one recent analysis.
In New Delhi, Tarun Lamba lost the first real job he ever had about a month ago, when he was laid off as a sales manager. Mr. Lamba, 24, said he knew bad news was coming because it had been weeks since he had written a truck loan. If he has to, he said, he could join his father's business, selling clothes. But he hopes it will not come to that.
"The cycle has to keep running," he said. "We had a boom period one year ago, now we are in a recession, and after some time the boom will come again."
Many newer workers, especially those in countries that moved from communism to capitalism in the 1990s, have known only boom times since then. For them, the shift is especially jarring, a main reason for the violence that exploded recently in countries like Latvia, a former Soviet republic.
"For the young generation, aged 20 to 24, this is the first time we've had this," said Valdis Zatlers, Latvia's president.
The ripples from the slowdown in Europe, North America and Asia are also being felt in Africa as migrant workers abroad lose their jobs and find themselves unable to send money home.
Since his last temporary job as a metalworker in Paris ended three months ago, Ignace Abdul has halted the monthly 200 euro payments he had been sending to his wife and three children back in Senegal. "Between 2004 and 2008, I worked nonstop," Mr. Abdul, 30, said in an interview in a bleak Paris unemployment office. "Right now, there is nothing."
Reporting was contributed by Keith Bradsher from Taipei, Taiwan; Heather Timmons from New Delhi; Simon Romero and Jenny Carolina González from Bogota, Colombia; and Maïa de la Baume from Paris.
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2) U.S. Airstrike Kills 30 in Pakistan
By PIR ZUBAIR SHAH
February 15, 2009
http://www.nytimes.com/2009/02/15/world/asia/15pstan.html?hp
ISLAMABAD, Pakistan - Two missiles fired from American drone aircraft killed more than 30 people, including Qaeda and Taliban fighters, near the Pakistani border with Afghanistan on Saturday, according to a Pakistani intelligence official and residents of the area.
The missiles struck three compounds, including one where the leader of the Pakistani Taliban, Baitullah Mehsud, and foreign and local fighters loyal to him sometimes gather, the official and residents said.
Mr. Mehsud, one of the most feared leaders in Pakistan's lawless tribal areas, was not among those killed, according to the official, who spoke on condition of anonymity because he was not authorized to speak to the press.
Mr. Mehsud, a Pakistani, has fought the government openly in the past, and government and intelligence officials say forces loyal to him continue to attack Pakistani troops in the Swat Valley and the Bajaur and Mohmand tribal areas. The previous government, led by Pervez Musharraf, accused Mr. Mehsud in the killing of Benazir Bhutto, a former Pakistani prime minister.
If Mr. Mehsud was the target of the attack in South Waziristan, it would be the first time that American missiles were aimed at him, the intelligence official said.
Missile attacks in Pakistan by remotely piloted aircraft operated by the Central Intelligence Agency have generally been aimed at foreign Qaeda fighters and Taliban guerrillas from Afghanistan, who take shelter in Pakistan between raids into their country to fight American and NATO soldiers.
A C.I.A. spokesman, Mark Mansfield, declined to comment on the reports of missile strikes on Saturday, as is the agency's standing policy. A spokesman for Pakistan's military was unavailable for comment.
Arabic and Uzbek fighters were among those killed Saturday, according to the intelligence official and residents of the area.
The attack followed a visit to Pakistan last week by Richard C. Holbrooke, the special American envoy to Pakistan and Afghanistan, that was part of a review of American policy in the region ordered by President Obama.
During his visit, Mr. Holbrooke heard a litany of complaints about drone strikes, some of which have inadvertently killed civilians, making it harder for the country's shaky government to win support for its own military operations against the Taliban.
It was unclear if any civilians where killed in Saturday's strikes, which residents say also hit a madrasa.
The drone attack also comes after a statement on Thursday by Senator Dianne Feinstein, Democrat of California and the chairwoman of the Senate Intelligence Committee, that the aircraft take off from a base in Pakistan. "As I understand it, these are flown out of a Pakistani base," Ms. Feinstein said during a hearing.
The drone attacks, especially in the last six months, have increased anti-American sentiment in Pakistan to very high levels, and Ms. Feinstein's statement is likely to further inflame the protests over them. Her statement was prominently covered by the Pakistani press on Saturday.
Although many Pakistanis have accused their government of giving quiet approval for the United States to strike in the tribal areas, they also assumed that the strikes came from Afghanistan.
In 2008, the American drones carried out more than 30 missile attacks against Qaeda and Taliban targets in the tribal areas, according to a report by the Council of Foreign Relations in Washington. Two missile attacks just days after Mr. Obama was inaugurated indicated that his administration, at least for now, planned to continue the policy of the Bush administration.
The compounds that were hit Saturday were in the village of Shwangai, near the town of Makeen.
A resident of the area said that bodies were still being recovered from the debris hours after the attack.
The attack was the fourth in the area controlled by Mr. Mehsud, but none of the others were believed to have had him as a target. Most of these attacks have occurred since September, when President Asif Ali Zardari took power.
Eric Schmitt contributed reporting from Washington.
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3) British Officers in '05 Killing in Subway Won't Be Charged
By JOHN F. BURNS
February 14, 2009
http://www.nytimes.com/2009/02/14/world/europe/14britain.html?ref=world
LONDON - After a new review of a police shooting that killed a Brazilian man mistakenly identified as a terrorist bomber, the agency that oversees criminal prosecutions said Friday that it would not charge any of the police officers involved.
The decision appeared to end years of efforts by the family of Jean Charles de Menezes, a 27-year-old electrician, to have members of Scotland Yard's counterterrorism squad prosecuted for the actions of two undercover officers who shot Mr. de Menezes seven times in the head after he boarded a subway train in London.
Several government-ordered inquiries and a prolonged inquest in 2008 showed that a series of police errors led to Mr. de Menezes being wrongly identified as a prime suspect in a series of abortive subway bombings on July 21, 2005, two weeks after suicide bombers killed 56 people, including the bombers, on the London transit system.
Despite the police errors, and wide differences between the police account of the shootings and that given by witnesses on the train, the Crown Prosecution Service said there was "insufficient evidence that any offense was committed by any individual officers."
The inquest focused on actions of two firearms officers, identified only as "Charlie 2" and "Charlie 12," who said they had shouted a warning to Mr. de Menezes as he sat in the stationary subway train, identifying themselves as police officers, and that he had advanced toward them.
But several witnesses testified at the inquest that they had heard no warning and that Mr. de Menezes had not moved toward the officers. Those discrepancies helped lead to the inquest jury's decision in December rejecting police claims that Mr. de Menezes had been shot lawfully.
On Friday, Stephen O'Doherty, a lawyer who led the review for the prosecution, acknowledged that "although there were some inconsistencies in what the officers said at the inquest, there were also inconsistencies in what passengers had said."
"I concluded that in the confusion of what occurred on the day, a jury could not be sure that any officer had deliberately given a false account of events," Mr. O'Doherty said.
It was not the first time the prosecution service had looked at the evidence and decided not to proceed. Mr. O'Doherty was appointed to review the inquest evidence and see if there were any fresh grounds for actions against the officers.
After the inquest finding, Mr. de Menezes's family had said they would take legal action challenging the coroner's ruling that a finding of unlawful killing was not an option. Given the choice of ruling that the killing was lawful or rendering an open verdict, the jury chose the latter. But on Friday the family announced through lawyers that they were dropping that action.
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4) 100,000 Parents of Citizens Were Deported Over 10 Years
By MICHAEL FALCONE
February 14, 2009
http://www.nytimes.com/2009/02/14/us/14immig.html?ref=us
WASHINGTON - Of nearly 2.2 million immigrants deported in the decade ended 2007, more than 100,000 were the parents of children who, having been born in the United States, were American citizens, according to a report issued Friday by the Department of Homeland Security.
But the department lacks data that might have addressed questions left unanswered by the report, like the number of American children who were left behind in the United States or, alternatively, exited the country with their deported parents. Nor could the report say in how many instances both parents of such children were deported.
Similarly, said Representative José E. Serrano, Democrat of New York, since no one knows how many children a given deportee had, the number of affected children could be much higher than 108,434, the exact number of deported parents of American citizens.
So "the problem goes deeper than just the numbers you see," said Mr. Serrano, who requested the study. He called the circumstance "tragic."
"If they took their children back," he said of the deportees, "then technically we deported an American citizen. No matter which side of the immigration issue you fall on, there's something wrong with the notion of kicking American citizens out of their own country."
The Homeland Security Department's office of inspector general, which conducted the review, said it had ordered a look at the feasibility of tracking down more data about the deportations.
Mr. Serrano, who represents a heavily Hispanic district in the Bronx, is vice chairman of the House Appropriations subcommittee that oversees spending on the department. He has introduced legislation that would allow immigration judges to take family status into account when deciding on deportations.
Mark Krikorian, executive director of the Center for Immigration Studies, a policy institute in Washington that supports tighter controls on immigration, said immigrant parents of children born here should not receive special treatment.
"Should those parents get off the hook just because their kids are put in a difficult position?" Mr. Krikorian said. "Children often suffer because of the mistakes of their parents."
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5) Coal Industry Wins a Round on Mining
By ANDREW C. REVKIN
February 14, 2009
http://www.nytimes.com/2009/02/14/science/earth/14mountain.html?ref=us
The latest in a series of federal court rulings on mountaintop coal mining in Appalachia came down firmly on the side of the coal industry on Friday.
The ruling, by the United States Court of Appeals for the Fourth Circuit, in Richmond, Va., overturned a 2007 decision that supported environmentalists' claims that the Army Corps of Engineers had improperly issued permits for several such mining operations.
For more than a decade, environmental campaigners have tried various legal avenues to fight the mining technique, a form of strip-mining that blasts the tops off mountains and dumps the leftover rock in valleys, burying streams.
After Friday's ruling, environmental groups urged President Obama to follow up on statements he had made during his campaign that were critical of mountaintop mining by reversing Bush administration policies intended to expand the practice.
Jennifer Chavez, a lawyer at Earthjustice, an environmental law firm that is a plaintiff in the case, called the decision "a landmark in a bad way," that could unleash a burst of new mining.
"There's a big backlog of permits, something like 80 or 90, we hear from our partners in West Virginia," Ms. Chavez said. "We're afraid there's going to be just a floodgate opening."
But Luke Popovich, a spokesman for the National Mining Association, said the industry was "delighted" and called the ruling "a sweeping vindication."
Mr. Popovich said that the 2007 ruling had resulted in a backlog of mining permits and created uncertainty that was harming the economy in the region.
The case, heard by three judges on the federal appeals panel, focused on whether the corps had been too liberal in allowing mining companies to bury streams as long as they created settling ponds and promised to transform drainage ditches into artificial streams that, in theory, might filter out contamination. The corps is responsible for preventing actions that could harm waters in the United States.
Among other arguments, the plaintiffs contended that the corps had not demonstrated scientifically that the ponds and artificial streams were effective.
The ruling said the corps had the expertise and discretion to issue such permits.
The mining association says that mountaintop mining in Appalachia produces about 10 percent of all coal mined in the United States and 40 percent of the coal mined in West Virginia and Kentucky.
Environmentalists have recently intensified their campaigns against mountaintop mining, arguing that it causes water contamination that is harmful to the residents of the valleys and that the expanding use of coal increases emissions of carbon dioxide, the main heat-trapping gas linked to global warming.
In the last months of the Bush administration, the Interior Department issued new rules intended to ease rules governing buffer zones along waterways, a change that could expand the mining method.
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6) Economic Confidence Continues to Fall
By REUTERS
February 14, 2009
http://www.nytimes.com/2009/02/14/business/economy/14econ.html?ref=business
Consumers and professional forecasters have cast off the last remnants of economic optimism, reports showed on Friday, as they confronted the reality of a long and deep recession.
The nation's economy will shrink by 5.2 percent in the first quarter on an annualized basis, its worst performance since 1982, according to a quarterly forecasting survey published by the Federal Reserve Bank of Philadelphia.
Consumer confidence fell to its lowest in three months in early February as sentiment grew increasingly gloomy over an economic downturn that most expect to last up to five years, according to another survey, the Reuters-University of Michigan Surveys of Consumers.
"Confidence fell in early February as consumers came to the consensus that the economy would remain in recession throughout 2009," the report said. "Moreover, nearly two-thirds anticipated that the downturn would last five more years."
The Reuters-University of Michigan Surveys of Consumers said its index reading of confidence for February tumbled to 56.2, from 61.2 in January.
The University of Michigan index is near the record low of 51.7 that it hit in May 1980. "The index was disappointing, reversing all the gains of the past two months," said Cary Leahey, an economist at Decision Economics.
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7) Inquiry on Graft in Iraq Focuses on U.S. Officers
By JAMES GLANZ, C.J. CHIVERS and WILLIAM K. RASHBAUM
February 15, 2009
http://www.nytimes.com/2009/02/15/world/middleeast/15iraq.html?hp
Federal authorities examining the early, chaotic days of the $125 billion American-led effort to rebuild Iraq have significantly broadened their inquiry to include senior American military officers who oversaw the program, according to interviews with senior government officials and court documents.
Court records show that last month investigators subpoenaed the personal bank records of Col. Anthony B. Bell, who is now retired from the Army but who was in charge of reconstruction contracting in Iraq in 2003 and 2004 when the small operation grew into a frenzied attempt to remake the country's broken infrastructure. In addition, investigators are examining the activities of Lt. Col. Ronald W. Hirtle of the Air Force, who was a senior contracting officer in Baghdad in 2004, according to two federal officials involved in the inquiry.
It is not clear what specific evidence exists against the two men, and both said they had nothing to hide from investigators. Yet officials say that several criminal cases over the past few years point to widespread corruption in the operation the men helped to run. As part of the inquiry, the authorities are taking a fresh look at information given to them by Dale C. Stoffel, an American arms dealer and contractor who was killed in Iraq in late 2004.
Before he was shot on a road north of Baghdad, Mr. Stoffel drew a portrait worthy of a pulp crime novel: tens of thousands of dollars stuffed into pizza boxes and delivered surreptitiously to the American contracting offices in Baghdad, and payoffs made in paper sacks that were scattered in "dead drops" around the Green Zone, the nerve center of the United States government's presence in Iraq, two senior federal officials said.
Mr. Stoffel, who gave investigators information about the office where Colonel Bell and Colonel Hirtle worked, was deemed credible enough that he was granted limited immunity from prosecution in exchange for his information, according to government documents obtained by The New York Times and interviews with officials and Mr. Stoffel's lawyer, John H. Quinn Jr. There is no evidence that his death was related to his allegations of corruption.
Prosecutors have won 35 convictions on cases related to reconstruction in Iraq, yet most of them involved private contractors or midlevel officials. The current inquiry is aiming at higher-level officials, according to investigators involved in the case, and is also trying to determine if there are connections between those officials and figures in the other cases. Although Colonel Bell and Colonel Hirtle were military officers, they worked in a civilian contracting office.
"These long-running investigations continue to mature and expand, embracing a wider array of potential suspects," a federal investigator said.
The reconstruction effort, intended to improve services and convince Iraqis of American good will, largely managed to do neither. The wider investigation raises the question of whether American corruption was a primary factor in damaging an effort whose failures have been ascribed to poor planning and unforeseen violence.
The investigations, which are being conducted by the Special Inspector General for Iraq Reconstruction, the Justice Department, the Army's Criminal Investigation Command and other federal agencies, cover a period when millions of dollars in cash, often in stacks of shrink-wrapped bricks of $100 bills, were dispensed from a loosely guarded safe in the basement of one of Saddam Hussein's former palaces.
Former American officials describe payments to local contractors from huge sums of cash dumped onto tables and stuffed into sacks as if it were Halloween candy.
"You had no oversight, chaos and breathtaking sums of money," said Senator Claire McCaskill, a Missouri Democrat who helped create the Wartime Contracting Commission, an oversight board. "And over all of that was the notion that failure was O.K. It doesn't get any better for criminals than that set of circumstances."
In one case of graft from that period, Maj. John L. Cockerham of the Army pleaded guilty to accepting nearly $10 million in bribes as a contracting officer for the Iraq war and other military efforts from 2004 to 2007, when he was arrested. Major Cockerham's wife has also pleaded guilty, as have several other contracting officers.
In Major Cockerham's private notebooks, Colonel Bell is identified as a possible recipient of an enormous bribe as recently as 2006, the two senior federal officials said. It is unclear whether the bribe was actually offered or paid.
When asked if Major Cockerham had ever offered him a bribe, Colonel Bell said in a telephone interview, "I think we'll end the discussion," but stayed on the line. Colonel Bell's response was equally terse when asked if he thought that Colonel Hirtle had carried out his duties properly: "No discussion on that at this time."
The current focus on Colonel Bell is revealed in federal court papers filed in Georgia, where he has a residence and is trying to quash a subpoena of his bank records by the Special Inspector General. The papers, dated Jan. 27, indicate that Colonel Bell's records were sought in connection with an investigation of bribery, kickbacks and fraud.
Colonel Bell said that he sought to quash the subpoena not because he had anything to hide, but because the document contained inaccuracies. "If they clean it up, I won't have a problem," he said, suggesting that he would cooperate. He declined to detail the inaccuracies, although his handwritten notations on the court papers indicated that the home address and the bank account number on the subpoena were incorrect.
Asked whether he knew why the records had been subpoenaed, he said, "That is not for me to direct what they're going to do."
Another case that has raised investigators' suspicions about top contracting officials involves a company, variously known as American Logistics Services and Lee Dynamics International, that repeatedly won construction contracts for millions of dollars despite a dismal track record.
One contracting official committed suicide in 2006 a day after admitting to investigators that she had taken $225,000 in bribes to rig bids in favor of the company. At least two other former contracting officials in Iraq have admitted to taking bribes in the case and are cooperating with investigators. It is unknown what information they may have provided on Colonel Hirtle, a high-ranking contracting official in Baghdad. But Colonel Hirtle signed the company's first major contract in Iraq in May 2004, a roughly $10 million deal to build arms warehouses for the fledgling Iraqi security forces, according to a copy of the contract and federal officials. The warehouses went largely unbuilt. Investigators said the inquiry into the Lee case was continuing.
"I can't talk to any media right now, because I don't know anything about this and I've got to do some research on it," Colonel Hirtle said when reached by phone in California, before abruptly hanging up.
The next day, Colonel Hirtle said he had been "taken aback" by questions about an investigation involving himself. "I try to keep things as transparent and aboveboard as I can," he said, referring questions to an Air Force public affairs office.
The Air Force referred questions to the United States Army Criminal Investigation Command, where a spokesman, Christopher Grey, said the command "does not discuss or confirm the names of persons who may or may not be under investigation."
An extraordinary element of the current investigation is a voice from beyond the grave: that of Mr. Stoffel, who died with a British associate, Joseph J. Wemple, in a burst of automatic gunfire on a dangerous highway north of Baghdad in December 2004 as he returned from a business meeting at a nearby military base.
A previously unknown Iraqi group claimed responsibility for the killings, which remain unsolved. The men may simply have been unlucky enough to be engulfed in the violence that was then just beginning to grip the country.
On May 20, 2004, a little more than a week after Colonel Hirtle signed the Lee company's warehouse contract, Mr. Stoffel was granted limited immunity by the Special Inspector General for what amounted to a whistle-blower's complaint. Copies of the immunity document were obtained from two former business associates of Mr. Stoffel.
The picture of corruption Mr. Stoffel painted, including the clandestine delivery of bribes, was "like a classic New York scenario," said a former business associate.
"Fifty thousand dollars delivered in pizza boxes to secure contracts," said the former associate, a consultant in the arms business with whom Mr. Stoffel sometimes worked in the former Eastern bloc. "Of course, it just looked like a pizza delivery."
It was Mr. Stoffel's experience with Eastern bloc weaponry that helped him win a contract to refurbish Iraq's Soviet-era tanks as part of a program to rebuild Iraq's armed forces. Mr. Stoffel's company remains locked in a dispute over payments it says are owed by the Iraqi government.
His problems with American officials were what led him to make the accusations of corruption. Mr. Stoffel, the associate said, "was trying to do this as quietly as possible, to blow the whistle."
"He knew enough about what was going on, and he was getting pretty frustrated."
Reporting was contributed by Eric Schmitt from Washington, David Beasley from Atlanta, Margot Williams from New York, and Riyadh Mohammed from Baghdad.
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8) U.S. Military Will Offer Path to Citizenship
""We're going to give people the opportunity to be part of the United States who are dying to be part of this country and they weren't able to before now," said Sergeant Campos, who was born in the Dominican Republic and became a United States citizen after he joined the Army."
By JULIA PRESTON
February 15, 2009
http://www.nytimes.com/2009/02/15/us/15immig.html?ref=world
Stretched thin in Afghanistan and Iraq, the American military will begin recruiting skilled immigrants who are living in this country with temporary visas, offering them the chance to become United States citizens in as little as six months.
Immigrants who are permanent residents, with documents commonly known as green cards, have long been eligible to enlist. But the new effort, for the first time since the Vietnam War, will open the armed forces to temporary immigrants if they have lived in the United States for a minimum of two years, according to military officials familiar with the plan.
Recruiters expect that the temporary immigrants will have more education, foreign language skills and professional expertise than many Americans who enlist, helping the military to fill shortages in medical care, language interpretation and field intelligence analysis.
"The American Army finds itself in a lot of different countries where cultural awareness is critical," said Lt. Gen. Benjamin C. Freakley, the top recruitment officer for the Army, which is leading the pilot program. "There will be some very talented folks in this group."
The program will begin small - limited to 1,000 enlistees nationwide in its first year, most for the Army and some for other branches. If the pilot program succeeds as Pentagon officials anticipate, it will expand for all branches of the military. For the Army, it could eventually provide as many as 14,000 volunteers a year, or about one in six recruits.
About 8,000 permanent immigrants with green cards join the armed forces annually, the Pentagon reports, and about 29,000 foreign-born people currently serving are not American citizens.
Although the Pentagon has had wartime authority to recruit immigrants since shortly after the Sept. 11 attacks, military officials have moved cautiously to lay the legal groundwork for the temporary immigrant program to avoid controversy within the ranks and among veterans over the prospect of large numbers of immigrants in the armed forces.
A preliminary Pentagon announcement of the program last year drew a stream of angry comments from officers and veterans on Military.com, a Web site they frequent.
Marty Justis, executive director of the national headquarters of the American Legion, the veterans' organization, said that while the group opposes "any great influx of immigrants" to the United States, it would not object to recruiting temporary immigrants as long as they passed tough background checks. But he said the immigrants' allegiance to the United States "must take precedence over and above any ties they may have with their native country."
The military does not allow illegal immigrants to enlist, and that policy would not change, officers said. Recruiting officials pointed out that volunteers with temporary visas would have already passed a security screening and would have shown that they had no criminal record.
"The Army will gain in its strength in human capital," General Freakley said, "and the immigrants will gain their citizenship and get on a ramp to the American dream."
In recent years, as American forces faced combat in two wars and recruiters struggled to meet their goals for the all-volunteer military, thousands of legal immigrants with temporary visas who tried to enlist were turned away because they lacked permanent green cards, recruiting officers said.
Recruiters' work became easier in the last few months as unemployment soared and more Americans sought to join the military. But the Pentagon, facing a new deployment of 30,000 troops to Afghanistan, still has difficulties in attracting doctors, specialized nurses and language experts.
Several types of temporary work visas require college or advanced degrees or professional expertise, and immigrants who are working as doctors and nurses in the United States have already been certified by American medical boards.
Military figures show that only 82 percent of about 80,000 Army recruits last year had high school diplomas. According to new figures, the Army provided waivers to 18 percent of active-duty recruits in the final four months of last year, allowing them to enlist despite medical conditions or criminal records.
Military officials want to attract immigrants who have native knowledge of languages and cultures that the Pentagon considers strategically vital. The program will also be open to students and refugees.
The Army's one-year pilot program will begin in New York City to recruit about 550 temporary immigrants who speak one or more of 35 languages, including Arabic, Chinese, Hindi, Igbo (a tongue spoken in Nigeria), Kurdish, Nepalese, Pashto, Russian and Tamil. Spanish speakers are not eligible. The Army's program will also include about 300 medical professionals to be recruited nationwide. Recruiting will start after Department of Homeland Security officials update an immigration rule in coming days.
Pentagon officials expect that the lure of accelerated citizenship will be powerful. Under a statute invoked in 2002 by the Bush administration, immigrants who serve in the military can apply to become citizens on the first day of active service, and they can take the oath in as little as six months.
For foreigners who come to work or study in the United States on temporary visas, the path to citizenship is uncertain and at best agonizingly long, often lasting more than a decade. The military also waives naturalization fees, which are at least $675.
To enlist, temporary immigrants will have to prove that they have lived in the United States for two years and have not been out of the country for longer than 90 days during that time. They will have to pass an English test.
Language experts will have to serve four years of active duty, and health care professionals will serve three years of active duty or six years in the Reserves. If the immigrants do not complete their service honorably, they could lose their citizenship.
Commenters who vented their suspicions of the program on Military.com said it could be used by terrorists to penetrate the armed forces.
At a street corner recruiting station in Bay Ridge in Brooklyn, Staff Sgt. Alejandro Campos of the Army said he had already fielded calls from temporary immigrants who heard rumors about the program.
"We're going to give people the opportunity to be part of the United States who are dying to be part of this country and they weren't able to before now," said Sergeant Campos, who was born in the Dominican Republic and became a United States citizen after he joined the Army.
Sergeant Campos said he saw how useful it was to have soldiers who were native Arabic speakers during two tours in Iraq.
"The first time around we didn't have soldier translators," he said. "But now that we have soldiers as translators, we are able to trust more, we are able to accomplish the mission with more accuracy."
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9) Killing Stirs Racial Unease in Texas
By JAMES C. McKINLEY Jr.
February 15, 2009
http://www.nytimes.com/2009/02/15/us/15paris.html?ref=us
PARIS, Tex. - The killing of Brandon McClelland, though horrible, never fit the classic description of a lynching. The police say two friends ran him over with a pickup truck after an argument during a night of drinking.
But Mr. McClelland was black and the men accused of killing him are white, and his gruesome death has reignited ugly feelings between races that have plagued this small town for generations, going back to the days 100 years ago when it was the scene of brutal public lynchings.
Blacks complain that the justice system is tilted against them; whites complain about the crime, teenage pregnancy and drug use ravaging black neighborhoods.
"I think we are probably stuck in 1930 right about now," said Brenda Cherry, who is black and is the founder of Concerned Citizens for Racial Equality. "If you complain about anything, you are going to be punished."
Paris is an agricultural town 100 miles northeast of Dallas that was built on cotton and grain in a part of Texas that shares more with the Deep South than with the West. In 1850, there were 4,000 residents, a quarter of them slaves. A large monument to the Confederate dead stands outside the courthouse, a bronze soldier standing guard, while at the Paris Fairgrounds, no plaques mark the spot where thousands of white spectators watched as black men were burned alive or hanged in the late 19th and early 20th centuries.
Today, 26,000 people live here, about 5,700 of them black. They are concentrated in public housing projects and run-down neighborhoods near the center of town. They send their children to Paris High School, where nearly half the students are black and test scores are low. The best school, North Lamar High School, is 86 percent white, and some blacks complain that the district lines are drawn to keep it that way.
Lamar County's highest elected official, Judge M. C. Superville, says Ms. Cherry and others who are unhappy with the justice system have exaggerated the role of race in recent events.
"There is a lot of misunderstanding in the community between blacks and whites," he said. "I do not believe there is systematic racial discrimination in Lamar County. I do believe there is a misperception that that is going on."
Still, the suspicions and ill will have grown so strong that the federal Department of Justice has dispatched a team of mediators to get residents to begin talking about the problem and to propose possible resolutions.
Last month, about 100 people of all races went to a building on the fairgrounds to vent their frustrations, while federal mediators took notes and tried to keep the peace. The speakers ran the gamut from young members of the New Black Panther Party in Dallas, who accused the local authorities of racism, to older black residents of Paris who chided younger blacks for comparing the problems of today with those of the Jim Crow era.
The few whites who spoke said they were sympathetic to the complaints of some black residents.
Mr. McClelland's death, on Sept. 16, attracted attention beyond the confines of Lamar County, because, on the surface, it resembled the racially motivated murder in 1998 of James Byrd Jr. in Jasper, Tex. Three white supremacists hunted Mr. Byrd down and dragged him behind a truck until he died.
Mr. McClelland, 24, was run over and dragged 40 feet by the pickup truck. His mutilated body was found on the side of a road, his skull smashed.
There the similarities to the Byrd killing end, however. Mr. McClelland, an affable young man who worked as a garbage collector and wanted to become a long-haul trucker, had a longstanding friendship with the two men in the truck. They had spent the previous day hanging wallboard and then had gone out drinking after the job.
The men - Shannon Finley and Charles Ryan Crostley, both 27 - fled the scene of the killing, the police said. Later that night, they turned up at Mr. McClelland's ramshackle home in Paris and told his mother that they had left him walking on the side of the road after they had argued about who should drive.
State troopers at first accepted the men's story and considered the case a hit and run, but they changed their minds after discovering Mr. McClelland's blood and tissue on the underside of the truck. Mr. Finley and Mr. Crostley are awaiting trial on murder charges; they have denied running Mr. McClelland down.
A special prosecutor from Dallas was appointed in November. The Lamar County district attorney, Gary Young, had declined to handle the case because as a private lawyer he represented Mr. Finley against a manslaughter charge in 2003.
In that case, Mr. Finley shot another friend, who was white, as they were sitting in a pickup. He claimed he had grabbed his friend's gun and was trying to shoot two armed men who were trying to rob them. Instead, his friend was hit three times in the head by accident, he said.
The district attorney agreed to a plea bargain on the reduced manslaughter charge. Mr. Finley served three years in prison; the robbers were never found.
Mr. Finley's manslaughter conviction ensnared Mr. McClelland as well. Mr. McClelland was convicted of lying to a grand jury about Mr. Finley's whereabouts to provide him with an alibi. He served more than a year in prison.
It was this friendship between the men that led the police to conclude that Mr. Finley's motive in the killing of Mr. McClelland was something other than race, the state police said.
The victim's mother, Jacqueline McClelland, said that the initial investigation into her son's death was shoddy and incomplete. The investigators left evidence scattered at the scene: freshly opened beer cans near the body, loose change covered with blood, skull fragments and tissue on the pavement.
Ms. McClelland said it was pressure from civil rights advocates, who held several protests in Paris last fall, that led to the arrest of Mr. Finley and Mr. Crostley. "They would have swept it under the rug, if I hadn't gotten other people involved," she said.
Mr. McClelland's death comes a year after another incident stirred up accusations of racism here. Shaquanda Cotton, a 14-year-old black girl, was sentenced by Judge Superville to juvenile prison after she shoved a hall monitor into a wall. Three months earlier, Judge Superville had sentenced a 14-year-old white girl to probation for burning down her family's house.
National civil rights groups protested what they called the unequal and harsh treatment of Miss Cotton, who spent a year in a West Texas juvenile prison.
Judge Superville denied that race played a role in Miss Cotton's sentence. He said she had a history of disciplinary problems, and her mother, Creola Cotton, had refused to cooperate with the state's efforts to change her daughter's behavior.
But Creola Cotton contends that her daughter was singled out and railroaded. She said she had complained several times to the school district about what she saw as unequal punishments for black and white students. That angered officials, so they retaliated against her daughter, she said.
"We live under a good-old-boy system here: the schools, the courthouse, the housing department," Ms. Cotton said at the recent meeting. "Everybody is relatives or good friends."
The mayor of Paris, Jesse James Freelen, who is white, dismissed such complaints as the result of "a lack of communication." He pointed out that the town previously elected a black mayor and now had a black mayor pro tem.
"Once we start communicating," Mr. Freelen said, "I believe we will find out the problems we believe we have are not as big as we think."
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10) Economic Lessons From Lenin's Seer
By KYLE CRICHTON
February 15, 2009
http://www.nytimes.com/2009/02/15/weekinreview/15crichton.html?ref=business
NIKOLAI KONDRATIEFF was not exactly a faceless bureaucrat in post-revolutionary Russia. He had held an important economic post in the last, short-lived government of Alexander Kerensky before the Bolsheviks took charge; then he founded an influential research organization, the Institute of Conjecture, and became an important theorist of the New Economic Policy under Lenin.
But he would long ago have been consigned to the dustbin of history had it not been for his quirky academic passion, which he pursued in a series of books and papers through the 1920s. Reviewing economic history since the late 18th century, Kondratieff came to a startling, doomsday conclusion: that capitalist economies were fated to go through regular and predictable cycles of around 50 years, inevitably culminating in a depression.
Despite having become a committed Communist and the author of a theory of inevitable if periodic capitalist collapses, Kondratieff was executed in 1938, a victim of the Stalinist purges. Apparently, he had raised too-trenchant questions about the government's newfound enthusiasm for heavy industry and agricultural collectives. After spending eight years in the gulag, he left behind a final letter to his daughter, poignantly urging her to be "a clever and good girl" and "not to forget about me."
It was a fitting epitaph, for whenever it seems Kondratieff is about to be forgotten, the economy nosedives. And once again, perhaps the most dismal of the dismal science's practitioners is back in the news, which his disciples try to fit into the cycles, or "Kondratieff waves," that he described.
Kondratieff and his disciples - among whom was Joseph Schumpeter, who wrote about capitalism's "creative destruction" - identified four stages in each cycle, corresponding to the seasons. After spurting ahead in the spring phase, they said, the economy cruises through the summer, experiences a scary drop as autumn sets in, and then - despite the TARPs, TALFs and whatever else governments do - descends into a winter phase that can last up to 20 years.
In case you hadn't noticed, it has been getting quite chilly lately.
Over the years, Kondratieff's appeal has waxed and waned in counterpoint to the economy, falling out of favor in good times but charging back when things look bleak. But his theory has never been accepted by mainstream economists, who consider it an occult hall of mirrors in which any sort of pattern can be discerned by shifting starting dates and definitions.
Kondratieff's adepts have cried depression before, for example in 1982. Reporting on the buzz his theory was getting during that downturn, a New York Times correspondent, Paul Lewis, wrote: "According to Kondratieffian analysis, the world is caught in the fourth great economic downswing since the 1790's, a period of global recession that will probably last until near the end of the century when a new age of prosperity will begin - and there is little anyone can do about it."
Today, Kondratieff's disciples (a dwindling band, by the way) are just as certain that the bad times began in 2000, with that year's stock market crash. That was followed by the autumn phase of the Bush years, characterized by an enormous (Kondratieff would say desperate) expansion of debt and leverage in an attempt to maintain the prosperity of the spring and summer years.
Evidently, Kondratieff waves tend to be in the eye of the beholder, and whatever value they have is descriptive, rather than predictive. After all, the American economy ultimately shrugged off several market drops like that of 2000, allowing the 25 years that followed 1982 to be a period of largely uninterrupted growth. But in the last decade of that period, the United States's growth was driven by debt in a desperate attempt to maintain an unsustainable level of consumption, a stage that Kondratieff's theory quite accurately describes.
"The people who do the predicting are usually not central within the discussion of economics," said David Colander, an economic historian at Middlebury College, and an expert in the discipline's crank theorists. But economies do "have this tendency to exceed" that Kondratieff and others have grasped, he added, and that is largely lost in modern economic theory.
He offers the Austrian School as a possible rival to Kondratieff's line of thought. Austrian economists tend to emphasize a laissez-faire approach and entrepreneurship (not the most popular policies at this moment) and strict limits on money supply growth, usually by hitching the currency to the gold standard.
While considered outside the mainstream, the Austrian School is far more respectable, counting in its ranks two Nobel Prize winners, Friedrich Hayek and James Buchanan. Peter Schiff of Euro Pacific Capital - an adviser to the libertarian presidential candidate Ron Paul and one of the most prominent doomsayers in the current collapse - also subscribes to its theories.
Hayek is said to have successfully predicted the Great Depression and some Austrian School devotees are taking credit for calling this one. "The financial meltdown the economists of the Austrian School predicted has arrived," Mr. Paul wrote in September, 11 days after Lehman Brothers filed for bankruptcy.
In the 1930s, John Maynard Keynes displaced Hayek and the Austrian School in intellectual popularity, establishing his "general theory" as the economic bible of the postwar decades. The Austrian line of thought made something of a comeback in the Reagan years, but never quite gained acceptance in the economic fraternity, Mr. Colander says.
"It probably should," he says.
"A good profession should take its outsiders more seriously," Mr. Colander says. "They make you look at things in different ways. The worst thing for policy makers is to think they are right."
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11) Decade at Bernie's
By PAUL KRUGMAN
Op-Ed Columnist
February 16, 2009
http://www.nytimes.com/2009/02/16/opinion/16krugman.html
By now everyone knows the sad tale of Bernard Madoff's duped investors. They looked at their statements and thought they were rich. But then, one day, they discovered to their horror that their supposed wealth was a figment of someone else's imagination.
Unfortunately, that's a pretty good metaphor for what happened to America as a whole in the first decade of the 21st century.
Last week the Federal Reserve released the results of the latest Survey of Consumer Finances, a triennial report on the assets and liabilities of American households. The bottom line is that there has been basically no wealth creation at all since the turn of the millennium: the net worth of the average American household, adjusted for inflation, is lower now than it was in 2001.
At one level this should come as no surprise. For most of the last decade America was a nation of borrowers and spenders, not savers. The personal savings rate dropped from 9 percent in the 1980s to 5 percent in the 1990s, to just 0.6 percent from 2005 to 2007, and household debt grew much faster than personal income. Why should we have expected our net worth to go up?
Yet until very recently Americans believed they were getting richer, because they received statements saying that their houses and stock portfolios were appreciating in value faster than their debts were increasing. And if the belief of many Americans that they could count on capital gains forever sounds naïve, it's worth remembering just how many influential voices - notably in right-leaning publications like The Wall Street Journal, Forbes and National Review - promoted that belief, and ridiculed those who worried about low savings and high levels of debt.
Then reality struck, and it turned out that the worriers had been right all along. The surge in asset values had been an illusion - but the surge in debt had been all too real.
So now we're in trouble - deeper trouble, I think, than most people realize even now. And I'm not just talking about the dwindling band of forecasters who still insist that the economy will snap back any day now.
For this is a broad-based mess. Everyone talks about the problems of the banks, which are indeed in even worse shape than the rest of the system. But the banks aren't the only players with too much debt and too few assets; the same description applies to the private sector as a whole.
And as the great American economist Irving Fisher pointed out in the 1930s, the things people and companies do when they realize they have too much debt tend to be self-defeating when everyone tries to do them at the same time. Attempts to sell assets and pay off debt deepen the plunge in asset prices, further reducing net worth. Attempts to save more translate into a collapse of consumer demand, deepening the economic slump.
Are policy makers ready to do what it takes to break this vicious circle? In principle, yes. Government officials understand the issue: we need to "contain what is a very damaging and potentially deflationary spiral," says Lawrence Summers, a top Obama economic adviser.
In practice, however, the policies currently on offer don't look adequate to the challenge. The fiscal stimulus plan, while it will certainly help, probably won't do more than mitigate the economic side effects of debt deflation. And the much-awaited announcement of the bank rescue plan left everyone confused rather than reassured.
There's hope that the bank rescue will eventually turn into something stronger. It has been interesting to watch the idea of temporary bank nationalization move from the fringe to mainstream acceptance, with even Republicans like Senator Lindsey Graham conceding that it may be necessary. But even if we eventually do what's needed on the bank front, that will solve only part of the problem.
If you want to see what it really takes to boot the economy out of a debt trap, look at the large public works program, otherwise known as World War II, that ended the Great Depression. The war didn't just lead to full employment. It also led to rapidly rising incomes and substantial inflation, all with virtually no borrowing by the private sector. By 1945 the government's debt had soared, but the ratio of private-sector debt to G.D.P. was only half what it had been in 1940. And this low level of private debt helped set the stage for the great postwar boom.
Since nothing like that is on the table, or seems likely to get on the table any time soon, it will take years for families and firms to work off the debt they ran up so blithely. The odds are that the legacy of our time of illusion - our decade at Bernie's - will be a long, painful slump.
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12) Economists' Forecast: Chance of Change 100%
By DAVID W. CHEN
February 16, 2009
http://www.nytimes.com/2009/02/16/nyregion/16york.html?ref=nyregion
The numbers are enough to make any New Yorker wince.
An unemployment rate of 7.4 percent in December, compared with 5.1 percent two years ago. A projected hemorrhaging of 294,000 jobs - 46,000 from Wall Street alone - by the summer of 2010.
A 41 percent drop in condominium sales from 2006 to 2008, and a 58 percent plunge for multifamily homes.
A city budget deficit of $4 billion this year, and as much as $7 billion the next.
And a mayor who is demanding that city employees pay 10 percent of their health care costs - or else risk losing their jobs.
With each passing hour, it seems, the avalanche of bad economic news, forecasts and anecdotes continues. And New Yorkers are struggling to comprehend just how bad it is, and how bad it may get, whether they lived through the fiscal crisis of the 1970s, or whether their only experience with an economic downturn was when share prices for Google began to slip.
To better understand the dimensions of the crisis, The New York Times talked to five people who have made the economics of New York their specialty, and asked them what to look for, what to expect, what to fear most, what not to overlook and what not to overreact to.
After all, a lot is at stake for a lot of people: whether they should move out of the city, whether they can afford to keep their small businesses, whether the city itself can afford to continue providing services and whether more city employees will find themselves looking for work, too.
As might be expected, there was hardly unanimity. But one thing that everyone agreed on is that whenever the financial swoon ends, the city - and its economy - will probably look very different.
John Tepper Marlin
Former Chief Economist
City Comptroller's Office
Some people have compared this recession to the Great Depression. Mr. Marlin's view? It could turn out to be worse.
He is troubled that this time, the crisis is more global in nature, given the interconnectedness of the world economy. That means it affects more people, and it also means there are more people to blame: the aggressive peddlers of subprime mortgages in California; the proponents of deregulation, led by two powerful former members of Congress from Texas, Dick Armey and Phil Gramm; and the people he sardonically calls the "geniuses" on Wall Street.
"We've had the verdict - Wall Street is guilty - but what's playing out here is the sentencing, and it's not just Wall Street that's being sentenced; it's the rest of the world," Mr. Marlin said.
There are other reasons to worry, he said. For instance, while many see the financial crisis of the 1970s as among New York's bleakest days, he believes this current crisis could be more painful. Back then, the state's fiscal health was solid, and the state was ultimately able to help the city. But this time, "if anything, the state is definitely in much worse shape," because of its own deficit of approximately $14 billion, and the prospect of mounting costs in the future for pension, health care and debt service expenses.
Mr. Marlin expects that there will be more defaults on buildings as condominium and co-op owners fail to pay their common charges, and also more sales of foreclosed properties. Rents will continue to dip. There will be longer lines at the grocery store, because fewer people will eat out. And he worries about unrest, citing hard-hit Iceland as a recent example.
"I'm concerned about people being so desperate that they lose the fear of losing their own lives and they become so desperate that they're willing to endanger other people's lives," he said.
Nicole Gelinas
Senior Fellow
The Manhattan Institute
You could say that there are wrong-way signs everywhere, according to Ms. Gelinas.
Personal income taxes in the city are expected to decrease 35 percent between 2007 and 2009: a drop unprecedented in recent memory. The number of tourists fell for the last two quarters, by roughly 5 percent, compared with the previous year. And, anecdotally, she has noticed deep discounts at retailers all over the city, well beyond the traditional post-holiday discount season, as well as unusual real estate deals in which landlords are offering prospective tenants free rent for a month or other enticements.
If these trends continue, she says, property owners will probably ask for property tax appeals and reassessments. And should those appeals succeed, the city's property tax collections would drop accordingly.
As a result, the city needs to tighten its belt in the right places - for instance, tackling the rising costs of pensions and health benefits for city employees - without hurting critical services like mass transit and police.
In addition, Ms. Gelinas says that the city cannot expect to rely on Wall Street bouncing back, given Washington's move to curtail bonuses and impose tougher oversight. So what is needed, she says, is a long-term change in mentality. And she says that it is incumbent upon the city and Mayor Michael R. Bloomberg, whom she has criticized in the past as lacking fiscal discipline, to persuade everyone - residents, city workers and businesses - that they must seriously scale back on their lifestyles and their expectations.
"If we don't act now to recognize that this is a deep change, a year and a half from now people could see visible differences in the quality of their lives," Ms. Gelinas said. "Eighteen months from now, people could see fewer police officers, less trash pickups, less visible school programs in the outer boroughs - things that really make a difference for some people, as they decide whether to stay or go, or buy or sell a house."
Charles Brecher
Director of Research
Citizens Budget Commission
Mr. Brecher does not want to hazard a guess as to whether the city is likely to face a financial meltdown, whether the economy will get worse but stop short of collapsing or whether the city will bounce back much more quickly than expected.
But he does suggest that the city has learned its lessons from the 1970s and 1980s, and is unlikely to see a repeat of anything so dire.
After all, during that period, there was a steady decline in jobs, especially as back-office functions moved out of the city and into the suburbs. And in the 1970s, he said, political leaders seemed ill equipped to deal with a fiscal crisis, and let city services deteriorate. "You got into this spiral where New York became a less desirable place," he recalled.
These days, he says, the city is in much better shape, thanks to the financial controls put in place in response to the 1970s crisis, as well as Mr. Bloomberg's decision to raise property taxes in 2003, and the practice of socking away hundreds of millions of dollars each year for a rainy-day fund.
Several key economic indicators will help to determine the recession's severity in New York, Mr. Brecher said.
In November, employment in the city posted the first year-over-year decline since March 2004. He is watching to see whether many of the high-paying financial jobs that vanished in recent months will be replaced by lower-paying ones.
He also wants to monitor how steeply office rents fall, from a record of roughly $84 a square foot in 2008.
Even so, Mr. Brecher is unwilling to make predictions.
"I'm very reluctant to trust my gut on this, because after 2001 everyone thought we were in a long-term bad time, but it was almost miraculous the way the city economy bounced back from that," he said.
Ronnie Lowenstein
Director
Independent Budget Office
Sure, the federal stimulus package agreed to by Congress last week promises to help New York City and the region tremendously, right away. But in the long run, the Treasury Department's bank bailout plan is bound to have a much greater impact because of the outsize importance of the financial industry in the city, according to Ms. Lowenstein.
"If you have a more highly regulated financial industry, and less highly leveraged - taking less risk, using less borrowed money to take risk - you're unlikely to see the same big run-ups in profits that we've enjoyed in recent years," she says. "And that has big implications for the city's economy and the city's budget and tax revenues."
Bear in mind, she says, that from 2003 to 2007, the securities industry accounted for 59 percent of the growth in wages and salaries in the city, according to the Quarterly Census of Employment and Wages from the Bureau of Labor Statistics, even though it makes up only 6 percent of all private-sector employment. So the questions that will help determine the future, she said, include: How successful have the bankers and traders who lost their jobs been in finding new work? And if they remain out of work for a long period, how long will their severance checks continue to pump money into the economy?
She is looking carefully at daily data on personal income taxes, which is collected by the state. Withholding collections reflect fluctuations in employment relatively quickly, because employers generally must make payment for the taxes withheld from their employees' paychecks on a monthly basis, if not more frequently.
But a caveat is warranted here: After workers in finance lose their jobs, they usually receive severance pay for four to six months, so even that data can lag.
One activity Ms. Lowenstein urges New Yorkers to resist, though, is obsessing about the stock market.
"It's important not to see it as an indicator of the real economy," she said. "It's just not."
Carol O'Cleireacain
Finance Commissioner
In Dinkins Administration
Forget about comparing the current recession to the Depression. In fact, do not even compare it to the recession of 1982, Ms. O'Cleireacain advises.
In the 1980s, she says, things were worse all over the country because of the twin drags of high inflation and high unemployment - the factors that make up the so-called misery index. In contrast to a misery index of 16 to 21 percent from 1979 to 1982, the figure now is 7.3 percent, since the inflation rate is almost zero.
What is different this time is the ubiquity, and speed, of information, sometimes triggering intense, immediate reaction and irrational behavior by amateur investors, and worsening the worry among employees concerned about their jobs.
"We're not even in 1982, but people are reacting to this real fear because it happened so fast, and it took them by surprise," she said.
She also points to a contrast with the Depression era, when banks had a monopoly on lending and credit. Today, there are all kinds of other institutions - hedge funds, mortgage agencies, insurance companies - with pools of capital. And because of that diversity, she concurs with many economists who believe that the economy may start to grow again in the fourth quarter of 2009.
Before then, she will be scrutinizing whether the city is meeting its cash needs, and whether its cash flow is good. She also will want to know whether the city has been able to borrow as much as it has wanted, or whether it is borrowing in smaller amounts, and to what extent it is paying a premium.
But she has faith.
"New York City isn't like Elkhart, Ind.," Ms. O'Cleireacain said, referring to a city that President Obama visited last week, one that largely depends on a single industry, recreational-vehicle manufacturing, and where unemployment has soared to 15 percent. New York, she said, "is a magnet for talent: for smart, enterprising, ambitious, innovative people, not only from this country but from around the world. Everyone wants to be here, and I think that sets us apart from virtually any other city."
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13) Finance Capitalism Hits a Wall
The Oligarchs' Escape Plan
The U.S. giveaway to banks, masquerading as "help for troubled homeowners"
By MICHAEL HUDSON
February 17, 2009
http://www.counterpunch.com/hudson02172009.html
The financial "wealth creation" game is over. Economies emerged from World War II relatively free of debt, but the 60-year global run-up has run its course. Finance capitalism is in a state of collapse, and marginal palliatives cannot revive it. The U.S. economy cannot "inflate its way out of debt," because this would collapse the dollar and end its dreams of global empire by forcing foreign countries to go their own way. There is too little manufacturing to make the economy more "competitive," given its high housing costs, transportation, debt and tax overhead. A quarter to a third of U.S. real estate has fallen into negative equity, so no banks will lend to them. The economy has hit a debt wall and is falling into negative equity, where it may remain for as far as the eye can see until there is a debt write-down.
Mr. Obama's "recovery" plan, based on infrastructure spending, will make real estate fortunes for well-situated properties along the new public transport routes, but there is no sign of cities levying a windfall property tax to save their finances. Their mayors would rather keep the cities broke than to tax real estate and finance. The aim is to re-inflate property markets to enable owners to pay the banks, not to help the public sector break even. So state and local pension plans will remain underfunded while more corporate pension plans go broke.
One would think that politicians would be willing to do the math and realize that debts that can't be paid, won't be. But the debts are being kept on the books, continuing to extract interest to pay the creditors that have made the bad loans. The resulting debt deflation threatens to keep the economy in depression until a radical shift in policy occurs - a shift to save the "real" economy, not just the financial sector and the wealthiest 10 per cent of American families.
There is no sign that Mr. Obama's economic advisors, Treasury officials and heads of the relevant Congressional committees recognize the need for a write-down. After all, they have been placed in their positions precisely because they do not understand that debt leveraging is a form of economic overhead, not real "wealth creation." But their tunnel vision is what makes them "reliable" to Wall Street, which doesn't like surprises. And the entire character of today's financial crisis continues to be labeled "surprising" and "unexpected" by the press as each new surprisingly pessimistic statistic hits the news. It's safe to be surprised; suspicious to have expected bad news and being a "premature doomsayer." One must have faith in the system above all. And the system was the Greenspan Bubble. That is why "Ayn Rand Alan" was put in charge in the first place, after all.
So the government tries to recover the happy Bubble Economy years by getting debt growing again, hoping to re-inflate real estate and stock market prices. That was, after all, the Golden Age of finance capital's world of using debt leverage to bid up the book-price of fictitious capital assets. Everyone loved it as long as it lasted. Voters thought they had a chance to become millionaires, and approved happily. And at least it made Wall Street richer than ever before - while almost doubling the share of wealth held by the wealthiest 1 per cent of America's families. For Washington policy makers, they are synonymous with "the economy" - at least the economy for which national economic policy is being formulated these days.
The Obama-Geithner plan to restart the Bubble Economy's debt growth so as to inflate asset prices by enough to pay off the debt overhang out of new "capital gains" cannot possibly work. But that is the only trick these ponies know. We have entered an era of asset-price deflation, not inflation. Economic data charts throughout the world have hit a wall and every trend has been plunging vertically downward since last autumn. U.S. consumer prices experienced their fastest plunge since the Great Depression of the 1930s, along with consumer "confidence," international shipping, real estate and stock market prices, oil and the exchange rate for British sterling. The global economy is falling into depression, and cannot recover until debts are written down.
Instead of doing this, the government is doing just the opposite. It is proposing to take bad debts onto the public-sector balance sheet, printing new Treasury bonds give the banks - bonds whose interest charges will have to be paid by taxing labor and industry.
The oligarchy's plans for a bailout (at least of its own financial position)
In periods of looming collapse, wealthy elites protect their funds. In times past they bought gold when currencies started to weaken. (Patriotism never has been a characteristic of cosmopolitan finance capital.) Since the 1950s the International Monetary Fund has made loans to support Third World exchange rates long enough to subsidize capital flight. In the United States over the past half-year, bankers and Wall Street investors have tapped the Treasury and Federal Reserve to support prices of their bad loans and financial gambles, buying out or guaranteeing $12 trillion of these junk debts. Protection for the U.S. financial elite thus takes the form of domestic public debt, not foreign currency.
It is all in vain as far as the real economy is concerned. When the Treasury gives banks newly printed government bonds in "cash for trash" swaps, it leaves today's unpayably high private-sector debt in place. All that happens is that this debt is now owed to (or guaranteed by) the government, which will have to impose taxes to pay the interest charges.
The new twist is a variant on the IMF "stabilization" plans that lend money to central banks to support their currencies - for long enough to enable local oligarchs and foreign investors to move their savings and investments offshore at a good exchange rate. The currency then is permitted to collapse, enabling currency speculators to rake in enough gains to empty out the central bank's reserves. Speculators view these central bank holdings as a target to be raided - the larger the better. The IMF will lend a central bank, say, $10 billion to "support the currency." Domestic holders will flee the currency at a high exchange rate. Then, when the loan proceeds are depleted, the currency plunges. Wages are squeezed in the usual IMF austerity program, and the economy is forced to earn enough foreign exchange to pay back the IMF.
As a condition for getting this kind of IMF "support," governments are told to run a budget surplus, cut back social spending, lower wages and raise taxes on labor so as to squeeze out enough exports to repay the IMF loans. But inasmuch as this kind "stabilization plan" cripples their domestic economy, they are obliged to sell off public infrastructure at distress prices - to foreign buyers who themselves borrow the money. The effect is to make such countries even more dependent on less "neoliberalized" economies.
Latvia is a poster child for this kind of disaster. Its recent agreement with Europe is a case in point. To help the Swedish banks withdrawtheir funds from the sinking ship, EU support is conditional on Latvia's government agreeing to cut salaries in the private sector - and not to raise property taxes (currently almost zero).
The problem is that Latvia, like other post-Soviet economies, has scant domestic output to export. Industry throughout the former Soviet Union was torn up and scrapped in the 1990s. (Welcome to victorious finance capitalism, Western-style.) What they had was real estate and public infrastructure free of debt - and hence, available to be pledged as collateral for loans to finance their imports. Ever since its independence from Russia in 1991, Latvia has paid for its imported consumer goods and other purchases by borrowing mortgage credit in foreign currency from Scandinavian and other banks. The effect has been one of the world's biggest property bubbles - in an economy with no means of breaking even except by loading down its real estate with more and more debt. In practice the loans took the form of mortgage borrowing from foreign banks to finance a real estate bubble - and their import dependency on foreign suppliers.
So instead of helping it and other post-Soviet nations develop self-reliant economies, the West has viewed them as economic oysters to be broken up to indebt them in order to extract interest charges and capital gains, leaving them empty shells. This policy crested on January 26, 2009, when Joaquin Almunia of the European Commission wrote a letter to Latvia's Prime Minister spelling out the terms on which Europe will bail out the Swedish and other foreign banks operating in Latvia - at Latvia's own expense:
Extended assistance is to be used to avoid a balance of payments crisis, which requires ... restoring confidence in the banking sector [now entirely foreign owned], and bolstering the foreign reserves of the Bank of Latvia. This implies financing ... outstanding government debt repayments (domestic and external). And if the banking sector were to experience adverse events, part of the assistance would be used for targeted capital infusions or appropriate short-term liquidity support. However, financial assistance is not meant to be used to originate new loans to businesses and households. ...
... it is important not to raise ungrounded expectations among the general public and the social partners, and, equally, to counter misunderstandings that may arise in this respect. Worryingly, we have witnessed some recent evidence in Latvian public debate of calls for part of the financial assistance to be used inter alia for promoting export industries or to stimulate the economy through increased spending at large. It is important actively to stem these misperceptions.
Riots broke out last week, and protesters stormed the Latvian Treasury. Hardly surprising! There is no attempt to help Latvia develop the export capacity to cover its imports. After the domestic kleptocrats, foreign banks and investors have removed their funds from the economy, the Latvian lat will be permitted to depreciate. Foreign buyers then can come in and pick up local assets on the cheap once again.
The practice of European banks riding the crest of the post-Soviet real estate bubble is backfiring to wreck the European economies that have engaged in this predatory lending to neighboring economies as well. As one reporter has summarized:
In Poland 60 percent of mortgages are in Swiss francs. The zloty has just halved against the franc. Hungary, the Balkans, the Baltics, and Ukraine are all suffering variants of this story. As an act of collective folly - by lenders and borrowers - it matches America's sub-prime debacle. There is a crucial difference, however. European banks are on the hook for both. US banks are not. Almost all East bloc debts are owed to West Europe, especially Austrian, Swedish, Greek, Italian, and Belgian banks.
This was the West's alternative to Stalinism. It did not help these countries emulate how Britain and America got rich by protectionist policies and publicly nurtured industrialization and infrastructure spending. Rather, the financial rape and industrial dismantling of the former Soviet economies was the most recent exercise in Western colonialism. At least U.S. investors were smart enough to stand clear and merely ride the stock market run-up before jumping ship.
But now, the government's plan to "save" the economy is to "save the banks," along similar lines to the West trying to save its banks from their adventure in the post-Soviet economies. This is the basic neoliberal economic plan, after all. The U.S. economy is about to be "post-Sovietized."
The U.S. giveaway to banks, masquerading as "help for troubled homeowners"
The Obama bank bailout is arranged much like an IMF loan to support the exchange rate of foreign currency, but with the Treasury supporting financial asset prices for U.S. banks and other financial institutions. Instead of banks and oligarchs abandoning the dollar, the aim is to enable them to dump their bad mortgages and CDOs and get domestic Treasury bonds. Private-sector debt will be moved onto the U.S. Government balance sheet, where "taxpayers" will bear losses - mainly labor not Wall Street, inasmuch as the financial sector has been freed of income-tax liability by the "small print" in last fall's Paulson-Bush bailout package. But at least the U.S. Government is handling the situation entirely in domestic dollars.
As in Third World austerity programs, the effect of keeping the debts in place at the "real" economy's expense will be to shrink the domestic U.S. market - while providing opportunities for hedge funds to pick up depreciated assets cheaply as the federal government, states and cities sell them off. This is called letting the banks "earn their way out of debt." It's strangling the "real" economy, because not a dollar of the government's response has been devoted to reducing the overall debt volume.
Take the much-vaunted $50 billion program designed to renegotiate mortgages downward for "troubled homeowners." Upon closer examination it turns out that the real beneficiaries are the giant leading banks such as Citibank and Bank of America that have made the bad loans. The Treasury will take on the bad debt that banks are stuck with, and will permit mortgagees to renegotiate their monthly payment down to 38 per cent of their income. But rather than the banks taking the loss as they should do for over-lending, the Treasury itself will make up the difference - and pay it to the banks so that they will be able to get what they hoped to get. The hapless mortgage-burdened family stuck in their negative-equity home turns out to be merely a passive vehicle for the Treasury to pass debt relief on to the commercial banks.
Few news stories have made this clear, but the Financial Times spelled the details buried in small print. It added that the Treasury has not yet decided whether to write down the debt principal for the estimated 15 million families with negative equity (and perhaps 30 million by this time next year as property prices continue to plunge). No doubt a similar deal will be made: For every $100,000 of write-down in debt owed by over-mortgaged homeowners, the bank will receive $100,000 from the Treasury. Government debt will rise by $100,000, and the process will continue until the Treasury has transferred $50,000,000 to the banks that made the reckless loans.
There is enough for just 500 of these renegotiations of $100,000 each. Hardly enough to make much of a dent, but the principle has been put in place for many further bailouts. It will take almost an infinity of them, as long as the Treasury tries to support the fiction that "the miracle of compound interest" can be sustained for long. The danger is the economy may be dead by the time saner economic understanding penetrates the public consciousness. In the mean time, bad private-sector debt will be shifted onto the government's balance sheet. Interest and amortization currently owed to the banks will be replaced by obligations to the U.S. Treasury. Taxes will be levied to make up the bad debts with which the government is stuck. The "real" economy will pay Wall Street - and will be paying for decades!
Calling the $12 trillion giveaway to bankers a "subprime crisis" makes it appear that bleeding-heart liberals got Fannie Mae and Freddie Mac into trouble by insisting that these public-private institutions make irresponsible loans to the poor. The party line is, "Blame the victim." But we know this is false. The bulk of bad loans are concentrated in the largest banks. It was Countrywide and other banksters that led the irresponsible lending and brought heavy-handed pressure on Fannie Mae. Most of the nation's smaller, local banks didn't make such reckless loans. The big mortgage shops didn't care about loan quality, because they were run by salesmen. The Treasury is paying off the gamblers and billionaires by supporting the value of bank loans, investments and derivative gambles, leaving the Treasury in debt.
U.S./Post-Soviet Convergence?
It may be time to look once again at what Larry Summers and his Rubinomics gang did in Russia in the mid-1990s and to Third World countries during his tenure as World Bank economist to see what kind of future is being planned for the U.S. economy over the next few years. Throughout the Soviet Union the neoliberal model established "equilibrium" in a way that involved demographic collapse: shortening life spans, lower birth rates, alcoholism and drug abuse, psychological depression, suicides, bad health, unemployment and homelessness for the elderly (the neoliberal mode of Social Security reform).
Back in the 1970s, people speculated whether the US and Soviet economies were converging. Throughout the 20th century, of course, everyone expected government regulation, infrastructure investment and planning to increase. It looked like the spread of democratically elected governments would go hand in hand with people voting in their own economic interest to raise living standards, thereby closing the inequality gap.
This is not the kind of convergence that has occurred since 1991. Government power is being dismantled, living standards have stagnated and wealth is concentrating at the top of the economic pyramid. Economic planning and resource allocation has passed into the hands of Wall Street, whose alternative to Hayek's "road to serfdom" is debt peonage for the economy at large. There does need to be a strong state, to be sure, to keep the financial and real estaterentier power in place. But the West's alternative to the old Soviet bureaucracy is a financial planning. In place of a political overhead, we have a financial and real estate overhead.
Stalinist Russia and Maoist China achieved high technology without land-rent, monopoly rent and interest overhead. This purging of rentier income was the historical task of classical political economy, and it became that of socialism. The aim was to create a Clean Slate financially, bringing prices in line with technologically necessary costs of production. The aim was to provide everyone with the fruits of their labor rather than letting banks and landlords siphon off the economic surplus.
Ideas of economic efficiency and "wealth creation" today are an utterly different kind of liberalism and "free markets." Commercial banks lend money not to increase production but to inflate asset prices. Some 70 per cent of bank loans are mortgage loans for real estate, and most of the rest is for corporate takeovers and raids, to finance stock buy-backs or simply to pay dividends. Asset-price inflation obliges people to go deeper into debt than ever before to obtain access to housing, education and medical care. The economy is being "financialized," not industrialized. This has been the plan as much for the post-Soviet states as for North America, Western Europe and the Third World.
But we are far from having reached the end of the line. Celebrations that our present financialized economy represents the "end of history" are laughingly premature. Today's policies look more like a dead end. But that does not mean that, like the Roman Empire, they won't lead us down toward a new Dark Age. That's what tends to happen when oligarchies do the planning.
Is America a Failed Economy?
It may be time to ask whether neoliberal pro-rentier economics has turned America and the West into a Failed Economy. Is there really no alternative? Have the neoliberals made the shift of planning from governments to the financial oligarchy irreversible?
Let's first dispose of the "foundation myth" of the idea still guiding the United States and Europe. Free-market economists pretend that prices can be brought into line most efficiently with technologically necessary costs of production under capitalism, and indeed, under finance capitalism. The banks and stock market are supposed to allocate resources most efficiency. That at least is the dream of self-regulating markets. But today it looks like only a myth, public relations patter talk to get a generation of increasingly indebted voters not to act in their own self-interest.
Industrial capitalism always has been a hybrid, a symbiosis with its feudal legacy of absentee property ownership, oligarchic finance and public debts rather than the government acting as net creditor. The essence of feudalism was extractive, not productive. That is why it created industrial capitalism as state policy in the first place - if only to increase its war-making powers. But the question must now be raised as to whether only socialism can complete the historical task that classical political economy set out for itself - the ideal that futurists in the 19th and 20th centuries believed that an unpurified capitalism might still be able bring about without shedding its legacy of commercial banking indebting property and carving infrastructure out of the public domain.
Today it is easier to see that the Western economies cannot go on the way they have been. They have reached the point where the debts exceed the ability to pay. Instead of recognizing this fact and scaling debts back into line with the ability to pay, the Obama-Geithner plan is to bail out the big banks and hedge funds, keeping the volume of debt in place and indeed, growing once again through the "magic of compound interest." The result can only be an increasingly extractive economy, until households, real estate and industrial companies, states and cities, and the national government itself is driven into debt peonage.
The alternative is a century and a half old, and emerged out of the ideals of the classical economic doctrines of Adam Smith, David Ricardo, John Stuart Mill, and the last great classical economist, Marx. Their common denominator was to view rent and interest are extractive, not productive. Classical political economy and its successor Progressive Era socialism sought to nationalize the land (or at least to fully tax its rent as the fiscal base). Governments were to create their own credit, not leave this function to wealthy elites via a bank monopoly on credit creation. So today's neoliberalism paints a false picture of what the classical economists envisioned as free markets. They were markets free of economic rent and interest (and taxes to support an aristocracy or oligarchy). Socialism was to free economies from these overhead charges. Today's Obama-Geithner rescue plan is just the reverse.
Michael Hudson is a former Wall Street economist. A Distinguished Research Professor at University of Missouri, Kansas City (UMKC), he is the author of many books, including Super Imperialism: The Economic Strategy of American Empire (new ed., Pluto Press, 2002) He can be reached via his website, mh@michael-hudson.com
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14) Union Talks Seen as Key as G.M. Makes Case for Funds
By BILL VLASIC and NICK BUNKLEY
February 17, 2009
http://www.nytimes.com/2009/02/17/business/economy/17auto.html?hp
DETROIT - With its access to a government lifeline possibly at risk, General Motors executives were locked in intense negotiations Monday with leaders of the United Automobile Workers over ways to cut its vast bills for retiree health care.
G.M. will file what is expected to be the largest restructuring plan of its 100-year history on Tuesday, a step it must take to justify its use of a $13.4 billion loan package from the federal government.
The plan will outline in considerable detail, over as many as 900 pages, how G.M. will further cut its work force, shutter more factories in North America and reduce its lineup of brands to just four, from eight, according to executives knowledgeable about its contents. The remaining core brands will be Chevrolet, Cadillac, GMC and Buick.
But G.M.'s plan to shrink its way to profitability will not mean much without an agreement with the U.A.W.
On Monday, G.M. pressed union leaders in a meeting in Detroit for a deal on financing what was the centerpiece of the 2007 U.A.W. contract - a perpetual, G.M.-financed trust to cover health care costs of hundreds of thousands of retired hourly workers and their surviving spouses.
Both sides were hopeful that either an agreement, or at least significant progress, might be achieved by the time G.M. submitted its plan, according to three people familiar with the substance of the negotiations.
Talks are also continuing between the U.A.W. and Ford Motor and Chrysler. But the focus of negotiations has been with G.M., which has to address how a company that lost more than $20 billion last year can afford $5 billion a year in medical bills.
In its overall plan, G.M. needs to show President Obama's new cabinet-level task force that it can substantially reduce costs and make a convincing case about its long-term viability by a March 31 deadline.
The company has already extended buyout offers to its entire United States unionized work force to reduce their ranks by another 20,000 jobs. It has also announced a 14 percent reduction in salaried workers around the world, leaving many of its white-collar workers in Detroit with limited prospects.
The plan will also probably include revisions in executive compensation and targets for cutting dealers and brands like Saturn and Pontiac.
Details of the plan have been closely guarded. G.M.'s board met Monday to review its contents, which will not be completed possibly until Tuesday, according to one G.M. official who asked not to be identified because of confidentiality agreements.
Chrysler was also said to be in the final stages of completing its plan on Monday, which will include further cuts in its manufacturing operations in the United States and more details on its strategy to rebuild its product lineup with a network of foreign alliances.
The plan was still under discussion late Monday with officials at Cerberus Capital Management, owner of an 80 percent stake, according to a person with knowledge of the situation.
The White House press secretary said Monday that the Obama administration was "anxious" to see the plans, but shared no timetable on when the president's task force would comment.
"We're anxious to take a look at the plans, understanding that it is extremely important to have a strong and viable auto industry," the press secretary, Robert Gibbs, told reporters aboard Air Force One. "Obviously that is going to require some restructuring to ensure its viability."
On Monday, the president designated the Treasury secretary, Timothy F. Geithner, and the chairman of the National Economic Council, Lawrence H. Summers, to oversee the task force on the auto industry.
The move surprised executives at G.M. and Chrysler, who were expecting the appointment of a "car czar" who would play an active part in negotiations between G.M. and Chrysler and their unions and lenders.
The task force is not likely to complete any review of the plans for at least a week or 10 days, according to an administration official who spoke on condition of anonymity. The president expects negotiations between G.M. and the U.A.W. and others to continue without pause for the plan's submission, the official said.
Talks between G.M. and its bondholders have cooled while the automaker considers the framework of an agreement offered by the bondholders to reduce G.M.'s debt to $9 billion, from $28 billion.
The U.A.W. talks, however, have been constant since Saturday, when Ron Gettelfinger, the union's president, at one point cut off discussions with G.M. - only to drive across town to take up the topic of retiree health care with Ford.
Ford has not received government loans, so it is significant that the U.A.W. appears to believe it must address retiree health care at all three Detroit auto companies simultaneously.
G.M. has the most at stake with the U.A.W. Its future obligations for retiree health care are estimated at $47 billion, and by next year it is required by its contract to contribute more than $10 billion to the trust set up in 2007.
The company, which nearly ran out of money before receiving the first $9.4 billion of its $13.4 billion in late December, is pressing the U.A.W. to accept stock for as much as 50 percent of its next contribution to the trust, according to two people knowledgeable about the discussions.
Mr. Gettelfinger, for his part, is trying to protect one of the jewels of the U.A.W. contract, which is essentially health care for life for anyone who worked on the assembly line and their surviving spouses. G.M. has already canceled health care for more than 100,000 of its salaried retirees.
"The U.A.W. at this point understands that it can very well turn into the villain of this whole thing by insisting that its workers receive health care benefits that few workers do," said Gary N. Chaison, a labor expert at Clark University in Worcester, Mass.
U.A.W. members are bracing for bad news, and worrying that their health care plan will be sacrificed to keep G.M. from going bankrupt.
"Where does it all stop?" said Mike Green, president of U.A.W. Local No. 652, which represents workers in Lansing, Mich. "It would be devastating. Our typical person works between 30 and 40 years. They did their part. Why should they have it taken away with the sweep of a pen?"
Micheline Maynard contributed reporting from Detroit, and Jackie Calmes from Washington.
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15) Afghan Civilian Deaths Rose 40 Percent in 2008, U.N. Says
By ALAN COWELL
February 18, 2009
http://www.nytimes.com/2009/02/18/world/asia/18afghan.html?ref=world
PARIS - Civilian casualties in Afghanistan rose by 40 percent last year, the highest level since the American-led invasion in late 2001 that dislodged the Taliban government, a United Nations report said Tuesday.
More than half of the 2,118 casualties were caused by militants' roadside bombs and suicide attacks, but many were from airstrikes and other actions by NATO and American forces battling the resurgent Taliban, the report said.
The findings deepened concern about civilians trapped between the combatants in an intensifying war that looms as one of the main foreign policy challenges facing the Obama administration. Richard C. Holbrooke, the special envoy for Afghanistan and Pakistan, has just completed a tour of the region.
President Obama is already weighing whether to double the American troop deployment in Afghanistan to about 60,000 troops. But Afghan officials, including President Hamid Karzai, have expressed dismay about civilian casualties, arguing that more troops could lead to more fatalities.
The United Nations report, compiled by a human rights unit, said the death toll among civilians rose to 2,118 in 2008 from 1,523 in 2007, most in the south of the country where fighting is intense.
The insurgents were blamed for 1,160, or 55 percent, of the deaths - an increase of 65 percent over similar attacks in 2007, the report said.
The report said 828 deaths, or 39 percent, were caused by pro-government forces, an increase of almost a third over the 2007 level.
The most glaring recent example of civilian casualties came last week, when five children were killed in predawn fighting between Australian special operations troops and Taliban guerrillas in south-central Afghanistan. Such episodes have reduced support among the Afghans for foreign troops on their soil.
But civilians have more to fear from the insurgents, the United Nations report said. A joint statement on Tuesday from the Afghan Interior Ministry and the American Command in Kabul said a roadside bomb on Monday killed five civilians near Kandahar; coalition forces who went to investigate came under small arms fire.
The report said: "2008 saw a distinct pattern of attacks by the armed opposition in crowded residential and other such areas with apparent disregard for the extensive damage they can cause to civilians."
The report also took issue with "an intimidation campaign that includes the summary execution of individuals perceived to be associated with, or supportive of the government and its allies."
It said 130 deaths "could not be attributed to any of the conflicting parties since, for example, some civilians died as a result of cross-fire or were killed by unexploded ordinance."
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16) For Education Chief, Stimulus Means Power, Money and Risk
By SAM DILLON
February 17, 2009
http://www.nytimes.com/2009/02/17/education/17educ.html?ref=education
WASHINGTON - The $100 billion in emergency aid for public schools and colleges in the economic stimulus bill could transform Arne Duncan into an exceptional figure in the history of federal education policy: a secretary of education loaded with money and the power to spend large chunks of it as he sees fit.
But the money also poses challenges and risks for Mr. Duncan, the 44-year-old former Chicago schools chief who now heads the Department of Education.
Mr. Duncan must develop procedures on the fly for disbursing a budget that has, overnight, more than doubled, and communicate the rules quickly to all 50 states and the nation's 14,000 school districts. And he faces thousands of tricky decisions about how much money to give to whom and for what.
"It'll be wonderful fun for a time for his team - it'll be like Christmas," said Chester Finn, a former Department of Education official who has watched education secretaries or commissioners come and go here since the mid-1960s. "But the thing about discretionary spending is that it makes more people angry than it makes happy."
The bill, which President Obama is expected to sign on Tuesday, doubles federal spending on disadvantaged and disabled children, includes hefty increases in the main federal college scholarship program and for Head Start, and, for the first time, makes billions in federal dollars available for school renovation.
Expectations are running so high, and the appetite for information is so large among the nation's educators, that when Mr. Duncan organized a conference call last Wednesday to begin explaining the stimulus bill's terms to a few dozen state and district superintendents, 800 callers swamped the switchboard.
Most of Mr. Duncan's unusual power would come in disbursing a $54 billion stabilization fund intended to prevent public sector layoffs, mostly in schools. The bill sets aside $5 billion of that to reward states, districts and schools for setting high standards and narrowing achievement gaps between poor and affluent students. The law lets Mr. Duncan decide which states deserve awards and which programs merit special financing.
"It's hard to imagine moving that much money that quickly," said Margaret Spellings, Mr. Duncan's predecessor, who turned her seventh-floor office over to him last month. "The point is, it's never been done before, and as much confidence as I have in Arne Duncan, there's an awesome opportunity for slippage with that much money moving through the meat grinder."
Maybe Ms. Spellings is slightly jealous, since she and other secretaries stretching back decades had only small amounts of money for favored projects.
"Teeny, teeny," said Amy Wilkins, who as vice president at the Education Trust, a civil rights group, has studied the budgets of several of Mr. Duncan's predecessors. "Margaret was looking for quarters in her pencil drawer."
Mr. Duncan said he understood the unusual circumstances.
"There's going to be this extraordinary influx of resources," he said in an interview. "So people say, 'You're going to be the most powerful secretary ever,' but I have no interest in that. Power has never motivated me. What I love is opportunity, and this is a once-in-a-lifetime opportunity to do something special, to drive change, to make our schools better."
Mr. Duncan said he intended to reward school districts, charter schools and nonprofit organizations that had demonstrated success at raising student achievement - "islands of excellence," he called them. Programs that tie teacher pay to classroom performance will most likely receive money, as will other approaches intended to raise teacher quality, including training efforts that pair novice instructors with veteran mentors, and after-school and weekend tutoring programs.
The stimulus money will help states avert some, but most likely not all, of the education cutbacks for the 2009-10 school year resulting from state budget shortfalls that currently total some $132 billion. California, for instance, is facing a $41 billion budget shortfall, much of it in school spending, but will receive some $11 billion in education money from the stimulus, estimates the National Education Association, the nation's largest teachers union.
The positions of deputy secretary, under secretary and chief of staff and dozens of other senior posts at the Education Department remain unfilled, so Mr. Duncan is relying on help from career officers and consultants. He has appointed teams to develop procedures for distributing the stimulus billions quickly, and many aides, he said, have been working evenings and weekends to begin organizing the effort.
"I want all of us to work hard enough and smart enough to take full advantage of this, because it'll never happen again," Mr. Duncan said last month in his first speech to hundreds of civil servants at department headquarters, as the outlines of the huge stimulus package were taking shape in Congress.
Urging department employees not to be deferential, he described the reception he got on his first visit to his headquarters.
"It was like, 'Hello, Mr. Secretary-designate-nominee,' and it didn't feel right," Mr. Duncan said. "My name is Arne. It's not Mr. Secretary. Please just call me Arne." That line drew a standing ovation.
He has hit it off well with Congress, too, so far. His wife, Karen, whom Mr. Duncan met in Australia, where he played professional basketball after his 1987 graduation from Harvard, accompanied him to his Senate confirmation, along with their daughter, Claire, 7, and son, Ryan, 4, who sat quietly during the hearing, reading storybooks.
"If you and your wife have done such a great job with Ryan, who is so well behaved, I hope you can do that with every child in American classrooms," said Senator Johnny Isakson, Republican of Georgia.
Another Republican senator, Lamar Alexander of Tennessee, said Mr. Obama had made "several distinguished cabinet appointments."
"I think you're the best," Mr. Alexander, who was education secretary under the first President Bush, said to Mr. Duncan.
But now comes the hard part.
Last year the Education Department distributed about $59 billion to states, school districts and colleges, most of it along well-worn financing paths mapped out by Congress.
"Congress usually spends two years debating the rules for how to spend $50 million," said Jack Jennings, president of the Center on Education Policy, a research organization in Washington. "But this time they're providing money without spelling out how it should be spent, so Arne Duncan and his staff are going to have to work out rules themselves in just weeks. He's going to have his hands full."
Congress has stipulated some rules, of course. To receive a share of the $54 billion stabilization fund, governors must make several "assurances" to Mr. Duncan, intended to drive school reforms: that they are developing statewide data systems that can allow schools to track individual students' academic progress, that they are assigning experienced teachers fairly to rich and poor schools alike, and so on. Mr. Duncan has the ticklish job of ruling on whether the governors' assurances are convincing.
And Congress has given him a $5 billion incentive fund that he can use to reward states that are raising student achievement and withhold money from states that are not. "We have states that tell the public that 90 percent of kids are meeting state standards," Mr. Duncan said, "but when we look at how they're doing on the National Assessment of Educational Progress, it's nowhere close. I'm not going to reward that. I want to be transparent about the good, bad and the ugly."
Some states and districts will get less than what they believe is their share, which could create powerful enemies.
"Secretary Duncan has a very challenging job," said Joel Packer, a lobbyist for the National Education Association. "It'll take a lot of effort to get this right."
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17) Resisting Home Evictions Becomes a Group Effort
By FERNANDA SANTOS
February 18, 2009
http://www.nytimes.com/2009/02/18/nyregion/18foreclose.html?scp=1&sq=Resisting%20Home%20Evictions%20Becomes%20a%20Group%20Effort&st=cse
As resistance to foreclosure evictions grows among homeowners, community leaders and some law enforcement officials, a broad civil disobedience campaign is starting in New York and other cities to support families who refuse orders to vacate their homes.
The community organizing group Acorn unveiled the campaign with a spirited rally on Friday at a Brooklyn church and will roll it out in at least 22 other cities in the coming weeks. Through phone trees, Web pages and text-messaging networks, the effort will connect families facing eviction with volunteers who will stand at their side as officers arrive, even if it means risking arrest.
“You want to haul us out to jail? Fine. Let the world see how government has been ineffective,” Bertha Lewis, Acorn’s chief organizer, said in an interview. “Politicians have helped banks, but they haven’t helped families in the way that it’s needed, and these families are now saying, enough is enough.”
At the onset of the foreclosure crisis, the problem was regarded by some as one of a homeowner’s own making, the result of irresponsible decisions made by families who chose to live beyond their means. But as foreclosures spread across the country, devastating even solidly middle-class communities, the blame has slowly shifted to the financial companies that made questionable loans and have received billions of dollars in federal aid to stave off collapse.
In recent months, a budding resistance movement has grown among Americans who believe they have been left to face their predicament on their own — and the Acorn campaign is an organized expression of that frustration, Ms. Lewis said. Instead of quietly packing up and turning their homes over to banks, homeowners are now fighting back.
On Feb. 9, a man scrawled a message on the roof of his house in a suburb of Los Angeles: “I Want 2 Be Heard.” Then he barricaded himself inside when deputies showed up to evict him, surrendering after a few hours. In October, a woman in San Diego chained herself to her front porch after the bank that held her mortgage refused to renegotiate the terms. She remains in her home, but has received a second eviction notice.
And last year in Boston, neighbors and activists locked arms outside eight buildings that had been foreclosed upon to prevent the authorities from forcing residents onto the streets.
Sheriffs in some places have also taken a stand. In Wayne County in Michigan, Sheriff Warren C. Evans, suspended all evictions starting Feb. 2 until the federal government implements a plan to help homeowners facing foreclosures.
In Cook County in Illinois, which includes Chicago, Sheriff Thomas J. Dart directed a lawyer to review all eviction orders to protect people who kept on paying rent after the buildings where they lived had been seized by banks. In Butler County in Ohio, Sheriff Richard K. Jones ordered his deputies not to evict people who had no place else to go.
“This is a cold place in the winter and I will not give people a death sentence for not paying their debts,” Sheriff Jones said in an interview. “These are human beings, responsible middle-class people who fell on hard times, and I just can’t toss them out onto the streets.”
Acorn’s strategy is modeled on a movement the group led in the 1980s, when squatters occupied and set out to renovate thousands of abandoned city-owned buildings in New York, Philadelphia and Detroit, among other cities. The motivation was to solve what Ms. Lewis has called “the working family’s housing crisis.”
In cities like Orlando, Fla., which has one of the nation’s highest foreclosure rates — and Boston, Houston, Baltimore, Oakland, Calif., and Tucson, Ariz. — Acorn organizers have been creating networks to alert a homeowner’s neighbors when an eviction has been scheduled or deputies are on the way. Some volunteers will summon friends and relatives to converge at the home, while others will be in charge of notifying the news media. Organizers are also recruiting lawyers willing to defend for no fee those who are arrested.
The campaign, called Home Defenders, enlisted about 500 participants during meetings held Friday and Saturday in New York and five other cities. Ms. Lewis and other organizers said that they believed the number will reach into the tens of thousands within weeks.
“This is a desperate, last-ditch effort by folks who are working two or three jobs, single mothers, elderly people who don’t know what else to do to save their homes,” said Ginny Goldman, Acorn’s lead organizer in Texas, where the campaign began in Houston on Saturday.
The rally in Brooklyn, at Brown Memorial Baptist Church in Fort Greene, drew about 150 people. There were homeowners, Acorn members, community advocates and candidates for the City Council. One councilman, Mathieu Eugene, was carrying a slab of papers as thick as a large dictionary, each sheet representing, he said, a family facing foreclosure in his district, which includes parts of Crown Heights, Flatbush and Kensington.
The church’s pastor, the Rev. Clinton M. Miller, opened the gathering with this prayer: “If anybody here is facing foreclosure, God, we ask that a miracle be made and a home be saved.”
Then, between homeowners’ sharing their plight, the crowd chanted, “Enough is enough.”
One homeowner, Myrna Millington, 73, who lives in Laurelton, Queens, said that she had to take a second mortgage on her home of 38 years to pay for repairs that turned out to more extensive than originally planned. What Ms. Millington did not know was that she had signed for a subprime loan, which carried interest rates so high she could not keep up with the payments. Her house was foreclosed on in September.
“I may lose my home, but I’m only leaving in handcuffs,” Ms. Millington said.
Another homeowner, Denise Parker, a mother of three who works as a housekeeper at two Midtown Manhattan hotels, bought a home in Springfield Gardens, Queens, in 2005 with an adjustable interest rate that, after two years, went up every six months. Her payments started at $3,500 and now are $5,050 a month, she said. She fell behind last year and her house is scheduled to be auctioned off on Friday.
“I refuse to leave the home that I’ve worked so hard to keep,” Ms. Parker, 42, told the audience. “I will not let the bank take my home and I will not leave.”
Eviction resistance actions are scheduled for Thursday in cities including New York, Oakland and Houston. Organizers will try to recruit enough volunteers to form a human wall on the sidewalk to avoid being arrested for trespassing. But occupying a house or having people attach themselves to a home could also be a tactic.
The campaign has earned praise and raised concern. Sheriff Dart, in Illinois, said it was a “slippery slope when you have individuals deciding whether they can lawfully remain in their homes.”
Sheriff Jones, in Ohio, equated the planned resistance to “chaining yourself to a tree that’s about to be cut down” and said that though he may not agree with it, he sympathizes.
In Washington, Acorn has found a staunch supporter in Representative Marcia C. Kaptur of Ohio, who, during a discussion last month about the $700 billion bailout package for financial companies, took to the floor of the House and instructed people to “stay in your homes — if the American people, anybody out there, is being foreclosed, don’t leave.”
In an interview, Ms. Kaptur said, “I’m thrilled that the American people are rising up and exercising the power that Wall Street has taken away from them.”
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18) A 'fraud' bigger than Madoff
Senior US soldiers investigated over missing Iraq reconstruction billions
By Patrick Cockburn in Sulaimaniyah, Northern Iraq
The Independent (UK)
February 16, 2009
http://www.independent.co.uk/news/world/americas/a-fraud-bigger-than-madoff-
1622987.html
In what could turn out to be the greatest fraud in US history, American
authorities have started to investigate the alleged role of senior military
officers in the misuse of $125bn (£88bn) in a US -directed effort to
reconstruct Iraq after the fall of Saddam Hussein. The exact sum missing may
never be clear, but a report by the US Special Inspector General for Iraq
Reconstruction (SIGIR) suggests it may exceed $50bn, making it an even
bigger theft than Bernard Madoff's notorious Ponzi scheme.
"I believe the real looting of Iraq after the invasion was by US officials
and contractors, and not by people from the slums of Baghdad," said one US
businessman active in Iraq since 2003.
In one case, auditors working for SIGIR discovered that $57.8m was sent in
"pallet upon pallet of hundred-dollar bills" to the US comptroller for
south-central Iraq, Robert J Stein Jr, who had himself photographed standing
with t
he mound of money. He is among the few US officials who were in Iraq
to be convicted of fraud and money-laundering.
Despite the vast sums expended on rebuilding by the US since 2003, there
have been no cranes visible on the Baghdad skyline except those at work
building a new US embassy and others rusting beside a half-built giant
mosque that Saddam was constructing when he was overthrown. One of the few
visible signs of government work on Baghdad's infrastructure is a tireless
attention to planting palm trees and flowers in the centre strip between
main roads. Those are then dug up and replanted a few months later.
Iraqi leaders are convinced that the theft or waste of huge sums of US and
Iraqi government money could have happened only if senior US officials were
themselves involved in the corruption. In 2004-05, the entire Iraq military
procurement budget of $1.3bn was siphoned off from the Iraqi Defence
Ministry in return for 28-year-old Soviet helicopters too obsolete to fly
and armoured cars easily penetrated by rifle bullets. Iraqi officials were
blamed for the theft, but US military officials were largely in control of
the Defence Ministry at the time and must have been either highly negligent
or participants in the fraud.
American federal investigators are now starting an inquiry into the actions
of senior US officers involved in the programme to rebuild Iraq, according
to The New York Times, which cites interviews with senior government
officia
ls and court documents. Court records reveal that, in January,
investigators subpoenaed the bank records of Colonel Anthony B Bell, now
retired from the US Army, but who was previously responsible for contracting
for the reconstruction effort in 2003 and 2004. Two federal officials are
cited by the paper as saying that investigators are also looking at the
activities of Lieutenant-Colonel Ronald W Hirtle of the US Air Force, who
was senior contracting officer in Baghdad in 2004. It is not clear what
specific evidence exists against the two men, who have both said they have
nothing to hide.
The end of the Bush administration which launched the war may give fresh
impetus to investigations into frauds in which tens of billions of dollars
were spent on reconstruction with little being built that could be used. In
the early days of the occupation, well-connected Republicans were awarded
jobs in Iraq, regardless of experience. A 24-year-old from a Republican
family was put in charge of the Baghdad stock exchange which had to close
down because he allegedly forgot to renew the lease on its building.
In the expanded inquiry by federal agencies, the evidence of a small-time US
businessman called Dale C Stoffel who was murdered after leaving the US base
at Taiji north of Baghdad in 2004 is being re-examined. Before he was
killed, Mr Stoffel, an arms dealer and contractor, was granted limited
immunity from prosecution after he had provided information that a network
of
bribery – linking companies and US officials awarding contracts – existed
within the US-run Green Zone in Baghdad. He said bribes of tens of thousands
of dollars were regularly delivered in pizza boxes sent to US contracting
officers.
So far, US officers who have been successfully prosecuted or unmasked have
mostly been involved in small-scale corruption. Often sums paid out in cash
were never recorded. In one case, an American soldier put in charge of
reviving Iraqi boxing gambled away all the money but he could not be
prosecuted because, although the money was certainly gone, nobody had
recorded if it was $20,000 or $60,000.
Iraqi ministers admit the wholesale corruption of their government. Ali
Allawi, the former finance minister, said Iraq was "becoming like Nigeria in
the past when all the oil revenues were stolen". But there has also been a
strong suspicion among senior Iraqis that US officials must have been
complicit or using Iraqi appointees as front-men in corrupt deals. Several
Iraqi officials given important jobs at the urging of the US administration
in Baghdad were inexperienced. For instance, the arms procurement chief at
the centre of the Defence Ministry scandal, was a Polish-Iraqi, 27 years out
of Iraq, who had run a pizza restaurant on the outskirts of Bonn in the
1990s.
In many cases, contractors never started or finished facilities they were
supposedly building. As security deteriorated in Iraq from the summer of
2003 it20was difficult to check if a contract had been completed. But the
failure to provide electricity, water and sewage disposal during the US
occupation was crucial in alienating Iraqis from the post-Saddam regime.
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