Aletho News

ΑΛΗΘΩΣ

The insolvent United States banking system: lessons from J.P. Morgan Chase

Why the banks must be nationalized

By Horace Campbell | PAMBAZUKA NEWS | 2012-05-17

Since September 15, 2008 the United States economy has been like a ticking time bomb with the unregulated activities of the banks the fuse that is slowly burning. This fuse has affected the international banking system and while citizens of the United States are focused on an electoral contest, the issues of the future of the U.S banking system, the future of the dollar and the future of the Euro are bringing home the reality of the capitalist depression. Two weeks ago, Paul Krugman released a book entitled, End this Depression Now. This book sought to galvanize action by the US government to stimulate the economy based on the twentieth century Keynesian ideas of stimulating growth. Increasingly, it is becoming clearer that far more drastic political measures will be needed if the international financial system is to be protected from the gambling of the top bankers in the United States. Wealth creation and a new economic system are needed to meet the needs of human beings.

This reality was brought home last Thursday, May 10, when it was revealed that J. P Morgan Chase, the largest bank in the United States had been involved in the most risky type of speculative trading that was not supposed to be undertaken by a federally insured depository institution. The nature of the speculative trading is still covered up by the media but from what has been coming out there were bets placed by a derivative trader who was placing US$100billion bets that the US economy would recover. One report called the operation ‘trades in the synthetic derivatives hedging business.’

Whether this is the real cause of the attention to JP Morgan Chase will only come to light when the media and the representatives of the people call for the removal of Jamie Dimon, the CEO of this bank and takes over the bank. While the information on the $3 billion loss is as opaque as the business world of the financial system, the nature of the risk that was being undertaken is reserved exclusively for the big banks and offers multi- million dollar profits in this ether world that is called financial capitalism.

JPMorgan Chase is currently one of the biggest banks in the world supposedly with $2.1 trillion in assets and more than 239,000 employees. I used the word ‘supposedly’ because JP Morgan Chase was one of the recipients of more than$26 billion of Troubled Asset Relief Program (TARP) funds after the collapse of Lehman Brothers and the American International Group (AIG) in September 2008. Troubled Assets was the term coined by the US government to hide from the world the state of the insolvency of the US banking system where the big banks had overextended themselves in the housing bubble issuing what was then called mortgage backed securities. These banks are still mired in the toxic mess from the orgy of speculation of that era and JP Morgan compounded its own risky position by taking over the bad bank, Washington Mutual.

The Bank JP Morgan Chase grew bigger and riskier after absorbing two of the failed banks at the center of the MBS debacle. JPS acquired Bears Stearns and Washington Mutual. Hence on top of its own involvement in the casino economy, JP Morgan Chase had taken on two failed banks in an attempt to save the US financial system.

The Tarp instrument was the means through which the US government had ‘bailed out the banks and investment houses in 2008. JP Morgan Chase was involved in the same credit default swaps (CDS) that was at the core of the gambling that brought down the system in 2008. The speculative activities of the Banks have increased since 2008 and now the press is seeking to lay the blame on one derivatives trader in London. According to the media, speculation by a derivatives trader in London has produced a $2 billion trading loss for JP Morgan Chase. It is still not clear the extent of the loss but we know that it is in the same category as the losses at MF Global last year. These losses add to the scandal after scandal and are supposed to be on par with the other debacles of 2008 when two major Wall Street institutions, Bear Stearns and then Lehman Brothers went bankrupt. This year the progressive forces must renew the call for the nationalization of the big banks which are supposed to be too big to fail.

THE ARROGANCE OF THE BIG BANKS

The rise and impending collapse of J P Morgan Chase is a cautionary tale about the fortunes (or currently misfortunes ) of the US banking system. Older readers will remember the name Chase Manhattan Bank and the era when David Rockefeller and this bank stood at the apex of US capitalism. Today Chase Manhattan no longer exists and has been absorbed through the mergers and acquisitions of the years of neo-liberal capitalism. Then there was the other major US capitalist whose fortunes were made when there were the most brutal forms of exploitation of workers. This was the banker and industrialist, John Pierpont Morgan. The career of JP Morgan was symbolic of the merger of industrial and bank capital to create financial capitalism at the turn of the twentieth century. Today at the start of the 21st century JP Morgan Chase is the result of the combination of several large U.S. banking companies over the last decade including Chase Manhattan Bank, J.P. Morgan & Co., Bank One, Bear Stearns and Washington Mutual. Going back further, the predecessors of the current banking behemoth include major banking firms among which are Chemical Bank, Manufacturers Hanover, First Chicago Bank, National Bank of Detroit, Texas Commerce Bank, Providian Financial and Great Western Bank.

JP Morgan Chase is a textbook case of what happened to US banks during the era of neo-liberalism when the Glass Steagall Act was repealed separating investment banking from federally insured deposit banks. Much attention has been paid to the two poster children of the new casino type operators who claim to be bankers, Jamie Dimon of JP Morgan Chase and Lloyd Blankfein of Goldman Sachs. These two are just at the top of the massive political structure that squeezes the mass of the citizens of the world for the top 1 per cent. In the book ‘13 Bankers: The Wall Street Takeover and the Next Financial Meltdown’, the authors Simon Johnson and James Kwak have detailed the evolution of the neo-liberal world that was spun by these bankers. According to Johnson and Kwak, the bankers created new money machines with new schemes such as securitization, high yield debt, arbitrage trading and derivatives. On top of these serial innovations we now have a new one called value at risk. Later we will be told what is synthetic derivatives hedging business. These “serial innovations created the new money machines that fueled the rapid, massive growth in the size, profitability and wealth of the financial sector over the last three decades.”

It is the accrued power of these bankers that now threatens the global system of capitalism. After the tremors of the financial markets in 2008 these same banks that called for deregulation called for bail outs because they were too big to fail. For a while, there had been word of the depth of the hole in other banks and we are still waiting for the information on Bank of America which is still under wraps with Wikileaks. Only two months ago, the Federal Reserve completed a “stress test” of the 19 largest US banks, which gave all of them a green light in terms of solvency and approved increased dividends or stock buybacks for 15 of the 19 banks. This exposure of JP Morgan exposes the fraud of the so called stress tests.

Although the banking system was propped up and we are informed in the media that these banks recently passed ‘stress tests,’ the news about the risky bets of JP Morgan is a stark reminder that the time bomb is ticking. Since that fateful week in September 2008, far from resolving the crisis of the US financial system, the bailout of Wall Street that had been orchestrated by the Federal government has resulted in a further centralization of financial assets in a handful of giant institutions that dominate American society. The further centralization now means that five of the 13 banks—JP Morgan Chase, Bank of America, Citigroup, Wells Fargo and Goldman Sachs — held $8.5 trillion in assets at the end of 2011. The big five have increased their viselike grip on the US economy over the past five years: in 2006, their financial holdings amounted to 43 percent of US gross domestic product. By the end of 2011, that figure had risen to 56 percent.

JP MORGAN AT THE FOREFRONT OF OPPOSING REGULATION

JP Dimon is the CEO of JP Morgan Chase. He has been the most active among the bankers in manipulating the system playing both sides of the political game and arguing against the regulation of the banks. Jamie Dimon was paid over US $23 million last year and now it is coming out that it is the accounting scams that produced the paper profits that enabled the big bonuses for Dimon and the traders who were urged to make riskier bets. Dimon has been the most active in the press and in his visits to the Obama White House. He has argued for the ‘markets’ to take their course when his bank has been in operation in a world that is beyond the reach of markets. While the world of these bankers is beyond the ‘market’ these are the financiers who promote the myth that the development of a generalized market (the least regulated possible) and democracy are complimentary to one another. The same bankers who argue that the economic sphere and the political sphere are separate and that the market does not need the state are the same bankers who are expending billions to lobby so that the limited regulations proposed by the Dodd-Frank legislation of 2010 are not affected. The Dodd-Frank legislation included one particular clause called the Volcker rule that was supposed to ban proprietary trading by the lords of the universe.

Jamie Dimon has been described by Barack Obama as one of the smartest bankers in the United States. Obama was simply exposing the subservience of the federal government to the bankers who are the same group pouring millions into both campaigns. The bankers are ensuring that whichever party wins in November, the US banking system will be protected. Barack Obama timidly called for regulating JP Morgan while actively engaging the soliciting of funds from one of the most notorious ‘private equity’ firms in New York. The close relationship between the private equity firms and the bankers constitute the power of the top one per cent and the US government acts to serve this one per cent. After the big scare of 2008 there was fear internationally that there would be a run on the dollar. It was this fear that induced the members of the US government to pass the Dodd-Frank Legislation to prevent the obscene conflict of interest of the banks and investment houses. The expedient which was supposed to prevent the conflict of interest was the Volcker rule, named after the former Treasury Secretary of an era before financialization. The rule placed trading restrictions on financial institutions. In the 2010 legislation, the Volcker rule separates investment banking, private equity and proprietary trading (hedge fund) sections of financial institutions from their consumer lending arms. Banks are not allowed to simultaneously enter into an advisory and creditor role with clients, such as with private equity firms. The Volcker rule aims to minimize conflicts of interest between banks and their clients through separating the various types of business practices financial institutions engage in.

JP Dimon has been the leader in opposing the Volcker rule because his organization has been at the forefront of the practice where a hedge fund is operating inside a commercial bank. Commercial banks are federally insured and are different from investment banks. Under the rules of the so called market, bankers are not supposed to take deposits from customers and then use the same deposits to make speculative bets. This was not supposed to happen but when the banks became huge money machines, they operated above the law. This is how a bank such as JP Morgan controls assets that are worth 20 per cent of the GDP of the USA.

BANKS MUST BE NATIONALIZED

Jamie Dimon sits on the Board of the Federal Reserve of New York. This is the most important position of the US financial system because this is the reserve system that holds the foreign reserves of 60 per cent of the economies of the world. JP Morgan Chase is a particularly critical financial institution, since in addition to its vast holdings; it serves as one of the two main clearing banks in New York City, along with Bank of New York Mellon, handling financial transactions for all other banks. Any challenge to its solvency immediately puts a question mark over the whole financial system. Central bankers all over the world are following with interest the call for Jamie Dimon to be removed from the Board of the Federal Reserve of New York because of conflicts of interest. The Federal Reserve Bank of New York carries out foreign exchange-related activities on behalf of the Federal Reserve System and the U.S. Treasury. In this capacity, the bank monitors and analyzes global financial market developments, manages the U.S. foreign currency reserves, and from time to time intervenes in the foreign exchange market. The bank also executes foreign exchange transactions on behalf of customers.

Tim Geithner now Treasury Secretary was the former President of the Federal Reserve Board of New York. It was under Geithner when billions were handed over to the bankers after 2008. Then Geithner was trying to save the US financial system so that foreigners will not pull their reserves out of the dollar. As Treasury Secretary, Geithner was reported to have had secret meetings with Jamie Dimon in March this year when news first surfaced of the synthetic trades.

Elizabeth Warren, now running for a Senate seat in Massachusetts, has called for the resignation of Jamie Dimon from the Federal Reserve Board of New York. Every citizen will understand that there is a conflict of interest [involved in] sitting on a board that is supposed to regulate the operations of JP Morgan Chase. But conflict of interest has never been a problem for the US capitalists. They changed the rules to suit themselves. However, this was before the era when other societies had alternatives. From China to Venezuela and from Argentina to Japan, central bankers are seeking ways to exit from the contagion of the speculative trading of US bankers.

Last year the world was exposed to the realities of the insolvency of the US financial system when there was the debate on the debt ceiling. Now it has been revealed that the debt ceiling will have to be raised again. This is sending shudders down the spine of financial institutions around the world.

The political struggles over the future of the US financial system are maturing. In order to pre-empt utter disaster the President of the Federal Reserve Bank of Dallas has called for the big banks to be broken up. The big banks continue to act on the assumption that the US dollar will be the reserve currency of international trade, especially now that the Euro is in disarray. These big banks are of the view that the US government will continue the devaluation of the US dollar without a response from the rest of the world. It is this understanding which has influenced the bankers to believe that the US government will intervene to bail them out when they make speculative bets that the US economy will improve. Many refuse to accept that this is a depression.

Sober elements understand that the banks must be broken up and this was stated explicitly in the annual report of the Federal Reserve Bank of Dallas. The letter from the head of the Dallas Federal Reserve is entitled, Choosing the Road to Prosperity Why We Must End Too Big to Fail—Now. In this letter, Richard Fisher from the Dallas Federal Reserve argues that the situation of the big banks is a disaster in waiting. Fisher would force the big banks to reorganize and get much smaller. And he would require “harsh and non-negotiable consequences” for any bank that ends in trouble and seeks government aid, including removal of its leaders, replacement of its board, voiding all compensation and bonus contracts and clawing back any bonus compensation for the two previous years.

It is now understood by these sober elements in the USA that the Big Banks may be not only too big to fail, but also too big to save.

The politicians in the USA are compromised and refuse to see the reality. It is the task of the progressive forces to keep the discussions on the JP Morgan losses on the table in order to educate the people on the nature of the depression. The major media houses such as the New York Times are attempting to manage this story saying that this $3-4 billion loss is a drop in the bucket. From the financial papers there is the buzz that one’s loss is another person’s gain. This is cold comfort to the poor all over the world who are suffering in the midst of this depression. In 2008 the government socialized the losses while the profits were privatized. The bailout was one of the biggest transfers of wealth from the poor of the world to the rich. These bankers now need another bail out and the US government will have to increase the debt ceiling.

For the moment the Occupy Wall Street Movement has made it impossible for the government to bail out the banks again. However, far from bailing out the bankers, speculators such as Corzine of MF Global and Jamie Dimon should be prosecuted. It is not enough to say that what JP Morgan was doing was inappropriate from a federally insured depository institution. It is time for the people to call for these banks to be taken over and the big bankers removed.

It is now time for audacity and more audacity. Nationalization and political education at the moment is more important than the elections. Bankers like JP Morgan profit from war and these forces want another big war so that the capitalists can recover. The peace and justice forces must be more vigilant. The JP Morgan Chase debacle heightens the desperation of the top one per cent in the USA.

May 20, 2012 Posted by | Book Review, Corruption, Deception, Economics, Militarism | , , , , | Leave a comment

Still Jews only

By Jonathan Cook | Al-Ahram | December 20, 2006

The problem facing the Palestinian leadership, as they strive to bring the millions living in the occupied territories some small relief from their collective suffering, amounts to a matter of a few words. A bit like a naughty child who has only to say “Sorry” to be released from his room, the Hamas government need only say “We recognise Israel” and supposedly aid and international goodwill will wash over the West Bank and Gaza.

That, at least, was the gist of Israeli Prime Minister Ehud Olmert’s recent speech during a visit to the Negev, when he suggested that his country’s hand was outstretched across the sands towards the starving masses of Gaza — if only Hamas would repent. “Recognise us and we are ready to talk about peace” was the implication.

Certainly the Palestinian people have been viciously punished for making their democratic choice early this year to elect a Hamas government that Israel and the Western powers disapprove of. An economic blockade has been imposed, starving the Palestinian Authority (PA) of income to pay for services and remunerate its large workforce. Millions of dollars in tax monies owed to the Palestinians have been illegally withheld by Israel, exacerbating the humanitarian crisis. A physical blockade of Gaza enforced by Israel has prevented the Palestinians from exporting their produce, mostly perishable crops, and from importing essentials like food and medicine. Israeli military strikes have damaged Gaza’s vital infrastructure, including the supply of electricity and water, as well as randomly killing its inhabitants. And thousands of families are being torn apart as Israel uses the pretext of its row with Hamas to freeze the visas of Palestinian foreign passport holders.

The magic words “We recognise you” could end all this suffering, so why not utter them? Is Hamas so filled with hatred and loathing for Israel as a Jewish state that it cannot make such a simple statement of good intent? Is the Palestinians’ recalcitrance not proof that they still want to drive the Jews into the sea?

It is easy to forget that, though conditions have dramatically deteriorated of late, the Palestinians’ problems did not start with the election of Hamas. Israel’s occupation is four decades old, and no Palestinian leader has ever been able to extract from Israel a promise of real statehood in all of the occupied territories: not the mukhtars, the largely compliant local leaders, who for decades were the only representatives allowed to speak on behalf of the Palestinians after the national leadership was expelled; not the PA under the secular leadership of Yasser Arafat, who returned to the occupied territories in the mid-1990s after the Palestine Liberation Organisation had recognised Israel; not the leadership of his successor, Mahmoud Abbas, the “moderate” who first called for an end to the armed Intifada; and now not the leaders of Hamas, even though they have repeatedly called for a long-term truce ( hudna ) as the first step in building confidence.

Similarly, few Palestinians doubt that Israel will continue to entrench the occupation — just as it did during the supposed peacemaking years of Oslo, when the number of Jewish settlers doubled in the occupied territories — even if Hamas is ousted and a government of national unity, of technocrats or even of Fatah, takes its place.

There is far more at stake for Israel in winning this little concession from Hamas than most observers appreciate. A statement saying that Hamas recognised Israel would do much more than meet Israel’s precondition for talks; it would mean that Hamas had walked into the same trap that was set earlier for Arafat and Fatah. That trap is designed to ensure that any peaceful solution to the conflict is impossible.

It achieves this end in two ways.

First, as has already been understood, at least by those paying attention, Hamas’s recognition of Israel’s “right to exist” would effectively signify that the Palestinian government was publicly abandoning its own goal of struggling to create a viable Palestinian state.

That is because Israel refuses to demarcate its own future borders, leaving it an open question what it considers to be the extent of its “existence” it is demanding Hamas recognise. We do know that no one in the Israeli leadership is talking about a return to Israel’s borders that existed before the 1967 war, or probably anything close to it.

Without a return to those pre-1967 borders (plus a substantial injection of goodwill from Israel in ensuring unhindered passage between Gaza and the West Bank) no possibility exists of a viable Palestinian state ever emerging.

And no goodwill, of course, will be forthcoming. Every Israeli leader has refused to recognise the Palestinians, first as a people and now as a nation. And in the West’s typically hypocritical fashion when dealing with the Palestinians, no one has ever suggested that Israel commit to such recognition.

In fact, Israeli governments have glorified in their refusal to extend the same recognition to the Palestinians that they demand from them. Famously Golda Meir, a Labour prime minister, said that the Palestinians did not exist, adding in 1971 that Israel’s “borders are determined by where Jews live, not where there is a line on a map.” At the same time she ordered that the Green Line, Israel’s border until the 1967 war, be erased from all official maps.

That legacy hit the headlines last week when the dovish education minister, Yuli Tamir, caused a storm by issuing a directive that the Green Line should be reintroduced in Israeli schoolbooks. There were widespread protests against her “extreme leftist ideology” from politicians and rabbis, and many schools said they would refuse to comply.

According to Israeli educators, the chances of textbooks showing the Green Line again — or dropping references to “Judea and Samaria”, the Biblical names for the West Bank, or including Arab towns on maps of Israel — are close to nil. The private publishers who print the textbooks would refuse to incur the extra costs of reprinting the maps, said Professor Yoram Bar-Gal, head of geography at Haifa University.

Sensitive to the damage that the row might do to Israel’s international image, and aware that Tamir’s directive is never likely to be implemented, Olmert agreed in principle to the change. “There is nothing wrong with marking the Green Line,” he said. But in a statement that made his agreement entirely hollow, he added: “But there is an obligation to emphasise that the government’s position and public consensus rule out returning to the 1967 lines.”

The second element to the trap is far less well understood. It explains the strange formulation of words Israel uses in making its demand of Hamas. Israel does not ask it simply to “recognise Israel”, but to “recognise Israel’s right to exist”. The difference is not a just matter of semantics.

The concept of a state having any rights is not only strange but also alien to international law. People have rights, not states. And that is precisely the point: when Israel demands that its “right to exist” be recognised, the subtext is that we are not speaking of recognition of Israel as a normal nation state but as the state of a specific people, the Jews.

In demanding recognition of its right to exist, Israel is ensuring that the Palestinians agree to Israel’s character being set in stone as an exclusivist Jewish state, one that privileges the rights of Jews over all other ethnic, religious and national groups inside the same territory. The question of what such a state entails is largely glossed over both by Israel and the West.

For most observers, it means simply that Israel must refuse to allow the return of the millions of Palestinians languishing in refugee camps throughout the region, whose former homes in Israel have now been appropriated for the benefit of Jews. Were they allowed to come back, Israel’s Jewish majority would be eroded overnight and it could no longer claim to be a Jewish state, except in the same sense that apartheid South Africa was a white state.

This conclusion is apparently accepted by Romano Prodi, Italy’s prime minister, after a round of lobbying in European capitals by Israel’s telegenic foreign minister, Tzipi Livni. According to The Jerusalem Post last week, Prodi is saying in private that Israel should receive guarantees from the Palestinians that its Jewish character will never be in doubt.

Israeli officials are cheering what they believe is the first crack in Europe’s support for international law and the rights of Palestinian refugees. “It’s important to get everyone on the same page on this one,” an official told the Post.

But in truth the consequences of the Palestinian leadership recognising Israel as a Jewish state run far deeper than the question of the future of Palestinian refugees. In my book Blood and Religion, I set out these harsh consequences both for the Palestinians in the occupied territories and for the million or so Palestinians who live inside Israel as citizens, supposedly with the same rights as Jewish citizens.

My argument is that this need to maintain Israel’s Jewish character at all costs is actually the cause of its conflict with the Palestinians. No solution is possible as long as Israel insists on privileging citizenship for Jews above other groups, and on distorting the region’s territorial and demographic realities to ensure that the numbers continue to weigh in the Jews’ favour.

Although ultimately the return of Palestinian refugees poses the biggest threat to Israel’s “existence”, Israel has a far more pressing demographic concern: the refusal by the Palestinians living in the West Bank to leave the parts of that territory Israel covets (and which it knows by the Biblical names of Judea and Samaria).

Within a decade, the Palestinians in the occupied territories and the million Palestinian citizens living inside Israel will outnumber Jews, both those living in Israel and the settlers in the West Bank.

That was one of the chief reasons for the “disengagement” from Gaza: Israel could claim that, even though it is still occupying the small piece of land militarily, it was no longer responsible for the population there. By withdrawing a few thousand settlers from the Strip, 1.4 million Gazans were instantly wiped from the demographic score sheet.

But though the loss of Gaza has postponed for a few years the threat of a Palestinian majority in the expanded state Israel desires, it has not magically guaranteed Israel’s continuing existence as a Jewish state. That is because Israel’s Palestinian citizens, though a minority comprising no more than a fifth of Israel’s population, can potentially bring the whole house of cards tumbling down.

For the past decade they have been demanding that Israel be reformed from a Jewish state, which systematically discriminates against them and denies their Palestinian identity, into a “state of all its citizens”, a liberal democracy that would give all citizens, Jews and Palestinians, equal rights.

Israel has characterised the demand for a state of all its citizens as subversion and treason, realising that, were the Jewish state to become a liberal democracy, Palestinian citizens could justifiably demand: the right to marry Palestinians from the occupied territories and from the Diaspora, winning them Israeli citizenship — “a right of return through the backdoor” as officials call it; the right to bring Palestinian relatives in exile back to their former homes in Israel under a Right of Return programme that would be a pale shadow of the existing Law of Return that guarantees any Jew anywhere in the world the automatic right to Israeli citizenship.

To prevent the first threat, Israel passed a flagrantly racist law in 2003 that makes it all but impossible for Palestinians with Israeli citizenship to bring a Palestinian spouse to Israel. For the time being, such couples have little choice but to seek asylum abroad, if other countries will give them refuge.

But like the Gaza disengagement, this piece of legislation is a delaying tactic rather than a solution to the problem of Israel’s “existence”. So behind the scenes Israel has been formulating ideas that taken together would remove large segments of Israel’s Palestinian population from its borders and strip any remaining “citizens” of their political rights unless they swear loyalty to a “Jewish and democratic state” and thereby renounce their demand that Israel reform itself into a liberal democracy.

This is the bottom line for a Jewish state, just as it was for a white apartheid South Africa: if we are to survive, then we must be able to do whatever it takes to keep ourselves in power, even if it means systematically violating the human rights of all those we rule over and who do not belong to our group.

Ultimately, the consequences of Israel being allowed to remain a Jewish state will be felt by all of us, wherever we live, and not only because of the fallout from continuing and growing anger in the Arab and Muslim worlds at the double standards applied by the West to the conflict between Israel and the Palestinians. Given Israel’s view that its most pressing interest is not peace or regional accommodation with its neighbours but the need to ensure a Jewish majority at all costs to protect its “existence”, Israel is likely to act in ways that endanger regional and global stability.

A small taste of that was offered in Israel’s cheerleading of the invasion of Iraq, during the build-up in 2002 and 2003, and its assault on Lebanon this summer. But it is most evident in its drumbeat of war against Iran.

Israel has been leading attempts to characterise the Iranian regime as profoundly anti-Semitic, and its presumed nuclear ambitions as directed by the sole goal of wanting to “wipe Israel off the map” — a calculatedly mischievous mistranslation of Iranian President Mahmoud Ahmadinejad’s speech.

Most observers have assumed that Israel is genuinely concerned for its safety from nuclear attack, however implausible the idea that even the most fanatical Muslim regime would, unprovoked, launch nuclear missiles against a small area of land that contains some of Islam’s holiest sites, in Jerusalem.

But in truth there is another reason why Israel is concerned about a nuclear-armed Iran that has nothing to do with conventional ideas about safety.

Last month, Ephraim Sneh, one of Israel’s most distinguished generals, a senior member of the Labour party and now Olmert’s deputy defence minister, revealed that the government’s primary concern was not the threat posed by Ahmadinejad firing nuclear missiles at Israel but the effect of Iran’s possession of such weapons on Jews who expect Israel to have a monopoly on the nuclear threat.

If Iran got such weapons, “Most Israelis would prefer not to live here; most Jews would prefer not to come here with families, and Israelis who can live abroad will … I am afraid Ahmadinejad will be able to kill the Zionist dream without pushing a button. That’s why we must prevent this regime from obtaining nuclear capability at all costs.”

In other words, the Israeli government is considering either its own pre-emptive strike on Iran or encouraging the United States to undertake such an attack — despite the terrible consequences for global security — simply because a nuclear- armed Iran might make Israel a less attractive place for Jews to live, lead to increased emigration and tip the demographic balance in the Palestinians’ favour.

Regional and possibly global war may be triggered simply to ensure that Israel’s “existence” as a state that offers exclusive privileges to Jews continues.

For all our sakes, we must hope that the Palestinians and their Hamas government continue refusing to “recognise Israel’s right to exist”.

* Jonathon Cook is a journalist based in Nazareth. His book Blood and Religion: The Unmasking of the Jewish and Democratic State is published by Pluto Press.

May 20, 2012 Posted by | Deception, Ethnic Cleansing, Racism, Zionism, Illegal Occupation, Timeless or most popular, Wars for Israel | , , , , , | 3 Comments

Ethiopia denies forcing indigenous people off land for foreign investors

By Tesfa-Alem Tekle | Sudan Tribune | May 17, 2012

ADDIS ABABA – The Ethiopian government has rejected growing accusations that it is forcibly relocating tens of thousands of indigenous people in the country’s south west in order to lease the land for commercial agriculture, mainly to foreign investors.

Earlier this year, the US-based Human Rights Watch (HRW) said the Ethiopian government, under its “villagization” program, has forcibly resettled an estimated 70,000 indigenous residents from the western Gambella region to new villages where there is inadequate food, farmland and access to healthcare, and education.

HRW claim resettlement has been carried out forcibly and those who refuse it face assault and arbitrary arrest at the hands of state security forces. These are allegations which Addis Ababa denies.

Government spokesperson, Shimels Kemal on Wednesday told Sudan Tribune that the accusations are “baseless” and are part of politically motivated smear campaign.

Kemal said the land being leased is only in areas that are currently agricultural, uninhabited or sparsely populated.

He conceded that relocations have taken place in the area, but said this had been done in consultation with the local populous and with their consent.

The relocated people received assistance in establishing new lives according to Kemal.

The Ethiopian government argues that the resettlement program is part of its strategy to ensure pastoralist areas of the country benefit from development and provides them with the necessary socio-economic infrastructures.

The programs have so far seen the relocation of some 20,000 households in the Gambella region and over 100,000 have also been resettled in Benshangul and Somali regions.

The Ethiopian government has plans to resettle some 1.5 million people by 2013 in Gambella, Afar, Somali, and Benishangul-Gumuz regions, in order to establish large-scale plantations there.

Related articles

May 20, 2012 Posted by | Economics, Environmentalism, Ethnic Cleansing, Racism, Zionism | | 1 Comment

BLM fails to justify Press TV ban

Press TV – May 20, 2012

German media regulatory body BLM has failed to provide legal justification for its decision to ban Press TV, after the channel files a lawsuit against the organization.

Press TV’s legal team says it has very strong evidence against BLM’s decision to ban the channel from a satellite platform in Europe.

It also says BLM has provided the court with a poor defense in which it has failed to provide any legal justification for its controversial move. The channel has called the ban “illegal.” And, in the lawsuit, Press TV has claimed compensation.

BLM took Press TV off the SES Astra satellite platform in early April. The media regulator claimed Press TV had no license to broadcast. However, the channel’s legal team has submitted documents to the court that prove Press TV can broadcast under German law.

An administrative court in Germany has accepted Press TV’s argument and the legal procedures have begun. The court has not yet specified a date for the hearings, but they are expected to start soon.

The channel has learned that the satellite platform is also taking legal action against BLM. Press TV has criticized German authorities for their attempt to silence the voice of the alternative news channel.

Press TV was taken off the air in Britain earlier this year, almost two years after the British government’s media regulatory body, Ofcom, launched a politically-charged battle against the channel.

According to Wikileaks’ cables, American and British officials discussed ways of limiting the operations of Press TV in a London meeting in 2010.

May 20, 2012 Posted by | Civil Liberties, Full Spectrum Dominance | , , , , , | 2 Comments

   

Follow

Get every new post delivered to your Inbox.

Join 513 other followers