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Why Trump Cancelled the Iran Deal

Eric Zuesse

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The following is entirely from open online sources that I have been finding to be trustworthy on these matters in the past. These sources will be linked-to here; none of this information is secret, even though some details in my resulting analysis of it will be entirely new.

It explains how and why the bottom-line difference between Donald Trump and Barack Obama, regarding U.S. national security policies, turns out to be their different respective estimations of the biggest danger threatening the maintenance of the U.S. dollar as the world’s leading or reserve currency. This has been the overriding foreign-policy concern for both Presidents.

Obama placed as being the top threat to the dollar, a breakaway of the EU (America’s largest market both for exports and for imports) from alliance with the United States. He was internationally a Europhile. Trump, however, places as being the top threat to the dollar, a breakaway of Saudi Arabia and of the other Gulf Arab oil monarchies from the United States. Trump is internationally a Sunni-phile: specifically a protector of fundamentalist Sunni monarchs — but especially of the Sauds themselves — and they hate Shia and especially the main Shia nation, Iran.

Here’s how that change, to Saudi Arabia as being America’s main ally, has happened — actually it’s a culmination of decades. Trump is merely the latest part of that process of change. Here is from the U.S. State Department’s official historian, regarding this history: By the 1960s, a surplus of U.S. dollars caused by foreign aid, military spending, and foreign investment threatened this system [the FDR-established 1944 Bretton Woods gold-based U.S. dollar as the world’s reserve currency], as the United States did not have enough gold to cover the volume of dollars in worldwide circulation at the rate of $35 per ounce; as a result, the dollar was overvalued. Presidents John F. Kennedy and Lyndon B. Johnson adopted a series of measures to support the dollar and sustain Bretton Woods: foreign investment disincentives; restrictions on foreign lending; efforts to stem the official outflow of dollars; international monetary reform; and cooperation with other countries. Nothing worked. Meanwhile, traders in foreign exchange markets, believing that the dollar’s overvaluation would one day compel the U.S. government to devalue it, proved increasingly inclined to sell dollars. This resulted in periodic runs on the dollar.

It was just such a run on the dollar, along with mounting evidence that the overvalued dollar was undermining the nation’s foreign trading position, which prompted President Richard M. Nixon to act, on August 13, 1971 [to end the convertibility of dollars to gold].

When Nixon ended the gold-basis of the dollar and then in 1974 secretly switched to the current oil-basis, this transformation of the dollar’s backing, from gold to oil, was intended to enable the debt-financing (as opposed to the tax-financing, which is less acceptable to voters) of whatever military expenditure would be necessary in order to satisfy the profit-needs of Lockheed Corporation and of the other U.S. manufacturers whose only markets are the U.S. Government and its allied governments, as well as of U.S. extractive industries such as oil and mining firms, which rely heavily upon access to foreign natural resources, as well as of Wall Street and its need for selling debt and keeping interest-rates down (and stock-prices — and therefore aristocrats’ wealth — high and rising). This 1974 secret agreement between Nixon and King Saud lasts to the present day, and has worked well for both aristocracies. It met the needs of the very same “military-industrial complex” (the big U.S. Government contractors) that the prior Republican President, Dwight Eisenhower, had warned might take control of U.S. foreign policies. As Bloomberg’s Andrea Wong on 30 May 2016 explained the Nixon system that replaced the FDR system, “The basic framework was strikingly simple. The U.S. would buy oil from Saudi Arabia and provide the kingdom military aid and equipment. In return, the Saudis would plow billions of their petrodollar revenue back into Treasuries and finance America’s spending.”

This new system didn’t only supply a constant flow of Saudi tax-money to the U.S. Government; it supplied a constant flow of new sales-orders and profits to the military firms that were increasingly coming to control the U.S. Government — for the benefit of both aristocracies: the Sauds, and America’s billionaires.

That was near the end of the FDR-produced 37-year period of U.S. democratic leadership of the world, the era that had started at Bretton Woods in 1944. It came crashing to an end not in 1974 (which was step two after the 1971 step one had ended the 1944 system) but on the day when Ronald Reagan entered the White House in 1981. The shockingly sudden ascent, from that moment on, of U.S. federal Government debt (to be paid-off by future generations instead of by current taxpayers) is shown, right here, in a graph of “U.S. Federal Debt as Percent of GDP, 1940-2015”, where you can see that the debt had peaked above 90% of GDP late in WW II between 1944-1948, and then plunged during Bretton Woods, but in 1981 it started ascending yet again, until reaching that WW II peak for a second time, as it has been ever since 2010, when Obama bailed-out the mega-banks and their mega-clients, but didn’t bail out the American public, whose finances had been destroyed by those banksters’ frauds, which Obama refused to prosecute; and, so, economic inequality in America got even more extreme after the 2008 George W. Bush crash, instead of less extreme afterward (as had always happened in the past).

Above 90% debt/GDP during and immediately following WW II was sound policy, but America’s going again above 90% since 2010 has reflected simply an aristocratic heist of America, for only the aristocracy’s benefit — all of the benefits going only to the super-rich.

Another, and more-current U.S. graph shows that, as of the first quarter of 2018, this percentage (debt/GDP) is, yet again, back now to its previous all-time record high of 105-120%%, which had been reached only in 1945-1947 (when it was justified by the war).

Currently, companies such as Lockheed Martin are thriving as they had done during WW II, but the sheer corruption in America’s military spending is this time the reason, no World War (yet); so, this time, America is spending like in an all-out-war situation, even before the Congress has issued any declaration of war at all. Everybody except the American public knows that the intense corruptness of the U.S. military is the reason for this restoration of astronomical ‘defense’ spending, even during peace-time. A major poll even showed that ‘defense’ spending was the only spending by the federal Government which Americans in 2017 wanted increased; they wanted all other federal spending to be reduced (though there was actually vastly more corruption in military spending than in any other type — the public have simply been hoodwinked).

But can the U.S. Government’s extreme misallocation of wealth, from the public to the insiders, continue without turning this country into a much bigger version of today’s Greece? More and more people around the world are worrying about that. Of course, Greece didn’t have the world’s reserve currency, but what would happen to the net worths of America’s billionaires if billionaires worldwide were to lose faith in the dollar? Consequently, there’s intensified Presidential worrying about how much longer foreign investors will continue to trust the oil-based dollar.

America’s political class now have two competing ideas to deal with this danger, Obama’s versus Trump’s, both being about how to preserve the dollar in a way that best serves the needs of ‘defense’ contractors, extractive firms, and Wall Street. Obama chose Europe (America’s largest market) as America’s chief ally (he was Euro-centric against Russia); Trump chose the owner of Saudi Arabia (he’s Saudi-Israeli centric against Iran) — that’s the world’s largest weapons-purchaser, as well as the world’s largest producer of oil (as well as the largest lobbies).

The Saudi King owns Saudi Arabia, including the world’s largest and most valuable oil company, Aramco, whose oil is the “sweetest” — the least expensive to extract and refine — and is also the most abundant, in all of the world, and so he can sell petroleum at a profit even when his competitors cannot. Oil-prices that are so low as to cause economic losses for other oil companies, can still be generating profits — albeit lowered ones — for King Saud; and this is the reason why his decisions determine how much the global oil-spigot will be turned on, and how low the global oil-price will be, at any given time. He controls the value of the U.S. dollar. He controls it far more directly, and far more effectively, than the EU can. It would be like, under the old FDR-era Bretton Woods system, controlling the exchange-rates of the dollar, by raising or lowering the amount of gold produced. But this is liquid gold, and King Saud determines its price.

Furthermore, King Saud also leads the Gulf Cooperation Council of all other Arab oil monarchs, such as those who own UAE — all of them are likewise U.S. allies and major weapons-buyers.

In an extraordinarily fine recent article by Pepe Escobar at Asia Times, “Oil and gas geopolitics: no shelter from the storm”, he quotes from his not-for-attribution interviews with “EU diplomats,” and reports:

After the Trump administration’s unilateral pull-out from the Iran nuclear deal, known as the Joint Comprehensive Plan of Action (JCPOA), European Union diplomats in Brussels, off the record, and still in shock, admit that they blundered by not “configuring the eurozone as distinct and separate to the dollar hegemony”. Now they may be made to pay the price of their impotence via their “outlawed” trade with Iran. …

As admitted, never on the record, by experts in Brussels; the EU has got to reevaluate its strategic alliance with an essentially energy independent US, as “we are risking all our energy resources over their Halford Mackinder geopolitical analysis that they must break up [the alliance between] Russia and China.”

That’s a direct reference to the late Mackinder epigone Zbigniew “Grand Chessboard” Brzezinski, who died dreaming of turning China against Russia.

In Brussels, there’s increased recognition that US pressure on Iran, Russia and China is out of geopolitical fear the entire Eurasian land mass, organized as a super-trading bloc via the Belt and Road Initiative (BRI), the Eurasia Economic Union (EAEU), the Shanghai Cooperation Organization (SCO), [and] the Asia Infrastructure Investment Bank (AIIB), is slipping away from Washington’s influence.

This analysis gets closer to how the three key nodes of 21st century Eurasia integration – Russia, China and Iran – have identified the key issue; both the euro and the yuan must bypass the petrodollar, the ideal means, as the Chinese stress, to “end the oscillation between strong and weak dollar cycles, which has been so profitable for US financial institutions, but lethal to emerging markets.” …

It’s also no secret among Persian Gulf traders that in the – hopefully unlikely – event of a US-Saudi-Israeli war in Southwest Asia against Iran, a real scenario war-gamed by the Pentagon would be “the destruction of oil wells in the GCC [Gulf Cooperation Council]. The Strait of Hormuz does not have to be blocked, as destroying the oil wells would be far more effective.”

And what the potential loss of over 20% of the world’s oil supply would mean is terrifying; the implosion, with unforeseen consequences, of the quadrillion derivatives pyramid, and consequentially [consequently] of the entire Western financial casino superstructure.

In other words: it’s not the ‘threat’ that perhaps, some day, Iran will have nuclear warheads, that is actually driving Trump’s concern here (despite what Israel’s concerns are about that matter), but instead, it is his concerns about Iran’s missiles, which constitute the delivery-system for any Iranian warheads: that their flight-range be short enough so that the Sauds will be outside their range. (The main way Iran intends to respond to an invasion backed by the U.S., is to attack Saudi Arabia — Iran’s leaders know that the U.S. Government is more dependent upon the Sauds than upon Israel — so, Iran’s top targets would be Saudi capital Riyadh, and also the Ghawar oil field, which holds over half of Saudi oil. If U.S. bases have been used in the invasion, then all U.S. bases in the Middle East are also be within the range of Iran’s missiles and therefore would also probably be targeted.)

Obama’s deal with Iran had focused solely upon preventing Iran from developing nuclear warheads — which Obama perhaps thought (mistakenly) would dampen Israel’s (and its billionaire U.S. financial backers’) ardor for the U.S. to conquer Iran. Israel had publicly said that their concern was Iran’s possibility to become a nuclear power like Israel became; those possible future warheads were supposed to be the issue; but, apparently, that wasn’t actually the issue which really drove Israel. Obama seems to have thought that it was, but it wasn’t, actually. Israel, like the Sauds, want Iran conquered. Simple. The nuclear matter was more an excuse than an explanation.

With Trump now in the White House, overwhelmingly by money from the Israel lobbies (proxies also for the Sauds) — and with no equivalently organized Jewish opposition to the pro-Israel lobbies (and so in the United States, for a person to be anti-Israel is viewed as being anti-Semitic, which is not at all true, but Israel’s lies say it’s true and many Americans unfortunately believe it) — Trump has not only the Sauds and their allies requiring him to be against Iran and its allies, but he has also got this pressure coming from Israel: both the Big-Oil and the Jewish lobbies drive him. Unlike Obama, who wasn’t as indebted to the Jewish lobbies, Trump needs to walk the plank for both the Sauds and Israel.

In other words: Trump aims to keep the dollar as the reserve currency by suppressing not only China but also the two main competitors of King Saud: Iran and Russia. That’s why America’s main ‘enemies’ now are those three countries and their respective allies.

Obama was likewise targeting them, but in a different priority-order, with Russia being the main one (thus Obama’s takeover of Ukraine in February 2014 turning it against Russia, next door); and that difference was due to Obama’s desire to be favorably viewed by the residents in America’s biggest export and import market, the EU, and so his bringing another member (Ukraine) into the EU (which still hasn’t yet been culminated).

Trump is instead building on his alliance with King Saud and the other GCC monarchs, a group who can more directly cooperate to control the value of the U.S. dollar than the EU can. Furthermore, both conservative (including Orthodox) Jews in the United States, and also white evangelical Protestants in the U.S., are strongly supportive of Israel, which likewise sides with the Arab oil monarchs against Iran and its allies. Trump needs these people’s votes.

Trump also sides with the Sauds against Canada. That’s a matter which the theorists who assert that Israel controls the U.S., instead of that the Sauds (allied with America’s and Israel’s billionaires) control the U.S., ignore; they ignore whatever doesn’t fit their theory. Of course, a lot doesn’t fit their theory (which equates “Jews” with “Israelis” and alleges that “they” control the world), but people whose prejudices are that deep-seated, can’t be reached by any facts which contradict their self-defining prejudice. Since it defines themselves, it’s a part of them, and they can never deny it, because to do so would be to deny who and what they are, and they refuse to change that. The Sauds control the dollar; Israel does not, but Israel does the lobbying, and both the Sauds and Israel want Iran destroyed. Trump gets this pressure not only from the billionaires but from his voters.

And, of course, Democratic Party billionaires push the narrative that Russia controls America. It used to be the Republican Joseph R. McCarthy’s accusation, that the “commies” had “infiltrated”, especially at the State Department. So: Trump kicked out Russia’s diplomats, to satisfy those neocons — the neoconservatives of all Parties and persuasions, both conservative and liberal.

To satisfy the Sauds, despite the EU, Trump has dumped the Iran deal. And he did it also to satisfy Israel, the main U.S. lobbyists for the Sauds. (Americans are far more sympathetic to Jews than to Arabs; the Sauds are aware of this; Israel handles their front-office.) For Trump, the Sauds are higher priority than Europe; even Israel (who are an expense instead of a moneybag for the U.S. Government) are higher priority than Europe. Both the Sauds and Israel together are vastly higher. And the Sauds alone are higher priority for Trump than are even Canada and Europe combined. Under Trump, anything will be done in order to keep the Sauds and their proxy-lobbyists (Israel) ‘on America’s side’.

Consequently, Trump’s political base is mainly against Iran and for Israel, but Obama’s was mainly against Russia and for the EU. Obama’s Democratic Party still are controlled by the same billionaires as before; and, so, Democrats continue demonizing Russia, and are trying to make as impossible as they can, any rapprochement with Russia — and, therefore, they smear Trump for anything he might try to do along those lines.

Both Obama and Trump have been aiming to extend America’s aristocracy’s dominance around the world, but they employ different strategies toward that politically bipartisan American-aristocratic objective: the U.S. Government’s global control, for the benefit of the U.S. aristocracy, at everyone else’s expense. Obama and Trump were placed into the White House by different groups of U.S. billionaires, and each nominee serves his/her respective sponsors, no public anywhere — not even their voters’ welfare.

An analogous example is that, whereas Fox News, Forbes, National Review, The Weekly Standard, American Spectator, Wall Street Journal, Investors Business Daily, Breitbart News, InfoWars, Reuters, and AP, are propagandists for the Republican Party; NPR, CNN, NBC, CBS, ABC, Mother Jones, The Atlantic, The New Republic, New Yorker, New York Magazine, New York Times, Washington Post, USA Today, Huffington Post, The Daily Beast, and Salon, are propagandists for the Democratic Party; but, they all draw their chief sponsors from the same small list of donors who are America’s billionaires, since these few people control the top advertisers, investors, and charities, and thus control nearly all of the nation’s propaganda. The same people who control the Government control the public; but, America isn’t a one-Party dictatorship. America is, instead, a multi-Party dictatorship. And this is how it functions.

Trump cancelled the Iran deal because a different group of billionaires are now in control of the White House, and of the rest of the U.S. Government. Trump’s group demonize especially Iran; Obama’s group demonize especially Russia. That’s it, short. That’s America’s aristocratic tug-of-war; but both sides of it are for invasion, and for war.  Thus, we’re in the condition of ‘permanent war for permanent peace’ — to satisfy the military contractors and the billionaires who control them. Any U.S. President who would resist that, would invite assassination; but, perhaps in Trump’s case, impeachment, or other removal-from-office, would be likelier. In any case, the sponsors need to be satisfied — or else — and Trump knows this.

Trump is doing what he thinks he has to be doing, for his own safety. He’s just a figurehead for a different faction of the U.S. aristocracy, than Obama was. He’s doing what he thinks he needs to be doing, for his survival. Political leadership is an extremely dangerous business. Trump is playing a slightly different game of it than Obama did, because he represents a different faction than Obama did. These two factions of the U.S. aristocracy are also now battling each other for political control over Europe.

Author’s note: article first published at strategic-culture.org

Investigative historian Eric Zuesse is the author, most recently, of They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010

Americas

From Popular Representation to International Isolationism: AMLO’s First Seven Months in Power

Lisdey Espinoza Pedraza

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It will soon be a year since the July 2018  Mexican presidential elections that saw Andrés Manuel López Obrador (AMLO) as the new head of the Executive. Has he lived up to the expectations 7 months after his inauguration? His popularity is real for now, it is largely based, however, on promises that have not yet been fulfilled, and that perhaps will be impossible to in his term.

One of the most striking features of his term so far is the fact that AMLO has displayed a serious disinterest in foreign affairs. AMLO won’t be attending the G-20, nor the WTO General Council Meeting to be held later on this year in Japan and Switzerland. This move risks the international presence of Mexico in the world. AMLO simply passed on the opportunity to negotiate potential trade deals with world leaders and show the world that he is indeed dissimilar from mainstream populists his outspoken opponents associate him with.

He has also effectively taken Mexico out of key regional groups in Latin America: Until his inauguration day, on December 1st, 2018 Mexico had played a central role in the Lima Group, formed by Argentina, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Honduras, Mexico, Panama, Paraguay and Peru. Guyana and Saint Lucia, countries pushing for the restoration of democracy, peace and security in Venezuela. Mexico has stopped participating in most of the Group’s meetings. Mexico has also stopped its active participation in the International Contact Group on Venezuela that seeks a negotiated solution to the Venezuelan problem. This group was the result of the conference jointly sponsored by the governments of Mexico and Uruguay; and that include other participating countries such as Bolivia, Costa Rica, Ecuador, France, Germany, Italy, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom. AMLO has then pulled Mexico out of 2 of the most important international groups dealing with one of the most pressing issues in Latin America.

AMLO has self-imposed an awkward international isolation that has left Mexico in a fragile diplomatic position and has undermined Mexican strength to defend from Trump’s threats and tantrums.

It is hard to understand AMLO’s inward-looking strategy. Mexico has let the opportunity go to form alliances with Europe, China, or other countries suffering from Trump’s equally protectionist foreign policy. The Mexican president during his first 7 months in power has not made any single trip abroad, nor did he visit any countries prior to his inauguration. AMLO seems determined to isolate Mexico from the international community for the sake of his increasingly worrying populist-like policies at home. Mexico and the United States have built a very odd political and economic marriage. They both share an insistence to put their own country first. Alike Trump, AMLO claims that his supporters have been mistreated by past administrations and economic and political elites. Similarly, both also have very little patience for established norms, institutions, checks and balances.

AMLO has also made domestic governmental austerity another of his core administration values. If well-targeted, following years of financial profligacy, this would be a more than welcome initiative. AMLO’s austerity has been ill-targeted and non-sensical. The way he allocates funds seem to follow a vengeful and populist attitude aimed at appeasing his electoral base that elected him. He has lowered wages; he has fired a large number of civil servants and has slashed the budgets of several ministries and organisations to centralise spending and fight public sector corruption. Health, Science and Technology, Home Affairs, the military have all faced severe budget cuts. He also cancelled the construction of Mexico City’s airport, which had already been partially built, at an enormous cost. Mexico’s economic growth is slowing down, and the current administration’s ill-planned decisions will mean that AMLO will face tighter budget constraints than previous administrations.

The two most worrying aspects of AMLO’s administration so far are the hyper-centralisation that he has carried out to return all the threads of power to presidential hands; and his absolute control of the Congress, meaning that they are able to amend the Constitution in any way they please. He is also attempting to establish a parallel system of power and government in each of the 32 states by naming a personal delegate. Such delegates will oversee the disbursing of federal funding becoming de-facto local officials accountable only to the president. He is also intending to pull back funding from pre-existing social programmes for victims of domestic violence, nurseries, and sport and academic activities.

AMLO’s strategy is nothing new. It bears a striking resemblance to the PRI’s heyday when the party kept a tight control over every sector of society. This power grab has been accompanied by an aggressive expansion of his political base. He has been handing out monthly stipends to nearly 10 million retirees, more than 7 million young people, and disabled that made up a large portion of his electorate. He also sacrificed the Education Reform to gain the loyalty of one of Mexico’s most numerous, corrupt and politically influential trade unions, the National Trade Union of Teachers (SNTE).All these policies are a throwback to Mexico’s old politics of clientelism, nepotism and authoritarianism.

Security and violence also remain as one of the most pressing issues in contemporary Mexico and that the last 3 administrations have been unable to thwart. AMLO’s strategy seems equally doomed to fail as he offers nothing new. None of his current plans will mean a real difference without a radically different approach to the justice and rule of law system and institutions currently in place. He needs the political will to build the capacity for real independent prosecution, and an internationally backed commission against corruption, impunity and human rights violations would be AMLO’s best chance to keep violence and security from ruining his other priorities.

Many of the current administration plans will, in all likelihood, fail to come to fruition. The popularity of AMLO is not rooted, however, in good economic decisions, nor in confidence in its government. In Mexico, popularity does not go hand in hand with governmental efficiency and effectiveness. Nevertheless, his popularity will soon end when people realise that he is unable to solve Mexico’s myriad of problems. The inability of the current administration to deal effectively with pressing challenges will only expose the country to greater domestic and international vulnerabilities.

AMLO might be on a dangerous path towards a point of no return. He continues to display authoritarian, demagogic inclinations, and there are virtually no counterweights as political opposition is in disarray. He, nonetheless, lacks the strong economic backup that once sustained the regime of the old state party, the Institutional Revolutionary Party (PRI). Therefore, he is forced to look for alternative ways to fund his ambitious political project or he will be doomed to fail. In the end, finances will be his make or break. Maintaining a patronage network to obtain votes require serious financial backing. With sufficient funds at his disposal, he could solidify his electoral base for years; without it his popularity and power will slowly erode. The damaging consequences to Mexico’s fragile institutions will last though as democratic checks and balances are harder to build than to break as the slow, protracted consolidation of democracy in Mexico has shown.

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Americas

Wall Street Wants Dems to Nominate Anyone But Sanders, Warren, or Gabbard

Eric Zuesse

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A June 16th article in the New York Times headlined “Wall Street Donors Are Swooning for Mayor Pete. (They Like Biden and Harris, Too.)”. It noted that “Two candidates in the top tier of polls, Mr. Sanders and Senator Elizabeth Warren of Massachusetts, have railed against the financial industry and opted against the kind of fancy fund-raisers with catering and $2,800 admission prices that lubricate the donor industry.” By contrast, against those two: “Mr. Biden, Mr. Buttigieg and Ms. Harris have aimed to blend aggressive large- and small-money operations, much as Mr. Obama’s campaigns successfully did.” Democratic voters who are satisfied with the Democratic Party of Barack Obama and of Hillary Clinton will be satisfied with either Buttigieg or Biden or Harris to become the U.S. President. “Mr. Buttigieg has hired a full-time professional New York fund-raiser.” And, “Even a donor who recently put together an event for one of Mr. Buttigieg’s rivals said that, these days, ‘the easiest event to sell out is a Buttigieg event.’” 

Harris is also attractive to Wall Street, but her particular strengths are in Hollywood and Silicon Valley, because she’s a U.S. Senator from California, and because even if she doesn’t win the nomination, they will still need to stay within her good graces, because she’s one of their two U.S. Senators and will be pitching for them there — or else not. 

On the other hand, Politico headlined on June 13th, “California poll: Warren surges to second, Harris falls to fourth”; and, so, Harris won’t likely be able to score even nearly as big in the California money-competion as she has been expecting, and the trend seems therefore to be for Warren to emerge as the female contender, and also as the progressive (even if only on financial issues) contender, for the votes from Democrats. But Sanders still could win California: whereas Warren scored 18%, he scored 17% in the poll.

The likeliest four to win the nomination, therefore, currently seem to be Biden, Buttigieg, Sanders, and Warren. Those are the four contenders from whom the winner will likely be chosen by the time the South Carolina primary becomes decided, on (as tentatively scheduled) 29 February 2020. 

Given that neither Sanders nor Warren would likely have sufficient attraction to the big-money people who fund the campaigns, it will probably come down to either Biden or Buttigieg, and I would expect that by the time of late February, Buttigieg will have drawn, to himself, enough of Biden’s supporters, so as to be able to be the leading “moderate” in the contest. He’ll have done this on the basis of little more than promises to the voters, which he won’t keep any more than Obama or Clinton did (or than Biden or Harris would). That’s the ‘middle of the road’ type of politician, the type who keeps his promises only to his biggest donors. That would mean a failed United States, the end of the American dream. Like Obama had told Wall Street’s tycoons right after coming into the White House, when he met secretly with them inside the White House: progressives are just “pitchforks” who want them to be punished, just as Southern White racists during the days of Jim Crow had wanted Blacks to be surrounded and lynched. Obama told them that to pursue them legally would be nothing more than bigotry against the rich, and that he would “protect” them from it — and he did. Here is how I wrote about that, at Strategic Culture, back on 17 June 2018:

The Inspector General of the U.S. Department of Justice issued on 13 March 2014 its “Audit of the Department of Justice’s Efforts to Address Mortgage Fraud,” and reported that Obama’s promises to prosecute turned out to be just lies. DOJ didn’t even try; and they lied even about their efforts. The IG found: “DOJ did not uniformly ensure that mortgage fraud was prioritized at a level commensurate with its public statements. For example, the Federal Bureau of Investigation (FBI) Criminal Investigative Division ranked mortgage fraud as the lowest criminal threat in its lowest crime category. Additionally, we found mortgage fraud to be a low priority, or not [even] listed as a priority, for the FBI Field Offices we visited.” Not just that, but, “Many Assistant United States Attorneys (AUSA) informed us about underreporting and misclassification of mortgage fraud cases.” This was important because, “Capturing such information would allow DOJ to … better evaluate its performance in targeting high-profile offenders.” …

On 27 March 2009, Obama assembled the top executives of the bailed-out financial firms in a secret meeting at the White House, and he assured them that he would cover their backs; he promised them “My administration is the only thing between you and the pitchforks”. It was never on the White House website; it was leaked out, which is one of the reasons Obama hates leakers (such as Chelsea Manning, Edward Snowden, and Julian Assange). What the DOJ’s IG indicated was, in effect, that Obama had kept his secret promise to them.

Here is the context in which he had said that (from page 234 of Ron Suskind’s 2011 book, Confidence Men, with boldfacings by me):“My administration is the only thing between you and the pitchforks.”It was an attention grabber, no doubt, especially that carefully chosen last word.

But then Obama’s flat tone turned to one of support, even sympathy. “You guys have an acute public relations problem that’s turning into a political problem,” he said. “And I want to help. But you need to show that you get that this is a crisis and that everyone has to make some sacrifices.” According to one of the participants, he then said, “I’m not out there to go after you. I’m protecting you. But if I’m going to shield you from public and congressional anger, you have to give me something to work with on these issues of compensation.”

No suggestions were forthcoming from the bankers on what they might offer, and the president didn’t seem to be championing any specific proposals. He had none: neither Geithner nor Summers believed compensation controls had any merit.

After a moment, the tension in the room seemed to lift: the bankers realized he was talking about voluntary limits on compensation until the storm of public anger passed. It would be for show.

Obama said “Everyone has to make sacrifices,” but he was talking to people who simply refused to be included in that “everyone.” As the mega-crooks who had been profiting from the crimes that had brought about the global economic collapse, those “sacrifices” should have been life-imprisonments. Only by means of such accountability, would their successors not try anything of the sort that these banksters had done. But such was not to be the case. So, the crimes continued.

Obama kept his word to them. The banksters got off scot-free, and kept their personal hundreds of millions of dollars ‘earned’.

He had been lying to the public, all along. Not only would he not prosecute the banksters, but he would treat them as if the only problem was the “pitchforks,” who were “an acute public relations problem that’s turning into a political problem.” The banksters weren’t a problem, but the public were, and he would protect them from the public. And he thought that the people who wanted them prosecuted were like the KKK who had chased Blacks with pitchforks before lynching. The “pitchforks” were to blame, and he would protect the banksters from those. According to the DOJ, Obama’s Financial Fraud Enforcement Task Force (FFETF) was “established by President Barack Obama in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.” But, according to the Department’s IG, it was all a fraud: a fraud (against the public, for the banksters) that, according to the DOJ, itself had been going on since at least November 2009.

The 13 March 2014 IG’s report continued by pointing out the Obama-appointed Attorney General’s lies, noting that on 9 October 2012, “the FFETF held a press conference to publicize the results of the initiative,” and:

“The Attorney General announced that the initiative resulted in 530 criminal defendants being charged, including 172 executives, in 285 criminal indictments or informations filed in federal courts throughout the United States during the previous 12 months. The Attorney General also announced that 110 federal civil cases were filed against over 150 defendants for losses totaling at least $37 million, and involving more than 15,000 victims. According to statements made at the press conference, these cases involved more than 73,000 homeowner victims and total losses estimated at more than $1 billion.

“Shortly after this press conference, we requested documentation that supported the statistics presented. … Over the following months, we repeatedly asked the Department about its efforts to correct the statistics. … Specifically, the number of criminal defendants charged as part of the initiative was 107, not 530 as originally reported; and the total estimated losses associated with true Distressed Homeowners cases were $95 million, 91 percent less than the $1 billion reported at the October 2012 press conference. …

“Despite being aware of the serious flaws in these statistics since at least November 2012, we found that the Department continued to cite them in mortgage fraud press releases. … According to DOJ officials, the data collected and publicly announced for an earlier FFETF mortgage fraud initiative – Operation Stolen Dreams – also may have contained similar errors.”

Basically, the IG’s report said that the Obama Administration had failed to enforce the Fraud Enforcement and Recovery Act of 2009. This bill had been passed overwhelmingly, 92-4 in the Senate, and 338-52 in the House. All Republicans had voted against it. (Perhaps Obama was secretly a Republican.) The law sent $165 million to the DOJ to catch the executive fraudsters who had brought down the U.S. economy, and it set up the Financial Crisis Inquiry Commission, and had been introduced and written by the liberal Democratic Senator Patrick Leahy. President Obama signed it on 20 May 2009. At that early stage in his Presidency, he couldn’t afford to display publicly that he was far to the right of every congressional Democrat, so he signed it.

Already on 15 November 2011, Syracuse University’s TRAC Reports had headlined “Criminal Prosecutions for Financial Institution Fraud Continue to Fall,” and provided a chart showing that whereas such prosecutions had been running at a fairly steady rate until George W. Bush came into office in 2001, they immediately plunged during his Presidency and were continuing that decline under Obama, even after the biggest boom in alleged financial fraud cases since right before the Great Depression. And, then, on 24 September 2013, TRAC Reports bannered “Slump in FBI White Collar Crime Prosecutions,” and said that “prosecutions of white collar criminals recommended by the FBI are substantially down during the first ten months of Fiscal Year 2013.” This was especially so in the Wall Street area: “In the last year, the judicial District Court recording the largest projected drop in the rate of white collar crime prosecutions — 27.8 percent — was the Southern District of New York (Manhattan).” On 29 July 2015, Syracuse University’s TRAC Reports headlined “Federal White Collar Prosecutions At 20-Year Low,” and linked to their full study, which showed that, whereas in fiscal year 2004-2005, under George W. Bush, “Bank Fraud” had been the #1 most-prosecuted of all ”white collar crime matters,” it was, in the latest fiscal year, 2014-2015, only #3.

These were extremely serious crimes: they crashed the world’s economy in 2008. But there was no White House interest in pursuing them. Instead, the Obama Administration blocked any such prosecutions, or even investigations into specific cases.

So: if these sorts of lies weren’t outright frauds against the American public, then what could possibly be?

But that’s not all of what belongs in the “whopper” or “Big Lie” category from Obama: he lied constantly about Ukraine, and about Syria, and about Russia and about his intentions toward Russia, and about his proposed international-trade treaties: TPP. TTIP, and TISA. 

None of these whoppers was included in the listing that the NYT presented in their 14 December 2017 article “Trump’s Lies vs. Obama’s”

How horrifically bad a U.S. President Barack Obama was, wasn’t reported by America’s press. Perhaps this is why the three leading candidates among America’s Democratic Party voters today are Joe Biden, Pete Buttigieg, and Kamala Harris. Supporters of any of those three are supporting, to become the Party’s nominee, someone who would respond to an economic crash very similarly to the way that Obama did (for the elite crooks, against the public). All three despise the “pitchforks” who want accountability, and each respects only his own mega-donors. 

Being satisfied with a U.S. President such as Obama was, is to be satisfied with a Democratic Presidential candidate such as Biden or Buttigieg or Harris is.

The Times article on 16 June 2019 mentioned also that there are other candidates, who currently are scoring lower in the polls, but who would be reaping big money from Wall Street, if only the given candidate had a realistic chance of winning the nomination: such as Cory Booker, Kirsten Gillibrand, Betto O’Rourke, and Michael Bennet. Sanders and Warren could never be supported by the big donors. Such candidates are too progressive to suit any of America’s billionaires, and therefore even if one of them were to win the nomination, that person’s campaign would end up being starved for funds from the few people who control the country. The big donors want only politicians who will keep only the promises that are made privately to the big donors, and not the promises that the candidate makes to the public. The big donors don’t care about the public promises, but only about the private ones, because, in today’s America, those are the only promises that a politician keeps — such as Obama exemplified. He had the slickness that Democratic Party billionaires demand. He’s able to retain his popularity among Democrats even after he had screwed them for eight successive years. They’re looking for another Obama. Pete Buttigieg will likeliest be that person. 

The most progressive of all of the candidates, Tulsi Gabbard, hasn’t caught on even amongst progressive voters — she’s currently at less than 1% in the primaries polls — and, consequently, whereas there are plenty of Biden clones among the well-heeled candidates, the only two candidates with any chance of actually winning the nomination and who are even moderately progressive, Sanders and Warren, are being shunned by the people who finance political campaigns. Unless one of those two gets tens of millions of small-dollar donors, the best that we’ll have during 2021-2025 will be either an Obama-Clinton clone, or else the current President, Trump. 

There’s no realistic way that the U.S. will have any improvement over Bush and Obama and Clinton and Trump, unless Democratic Party voters refuse to settle for the people who are being backed by the Democratic Party’s billionaires. And it also won’t happen from the Republican Party’s billionaires. The only way it even possibly could  happen is if Democrats choose only a progressive, and won’t any longer settle for merely a liberal (a “moderate” in the Democratic Party) (such as Democratic Party primary voters have done in the recent past, and seem inclined to do now). It would need to be a substantially different electorate.

Just as Republican voters are ignorant of how bad the Bushes and Trump are, Democratic voters are ignorant of how bad the Clintons and Obama are. Each Party’s voters are the fools of that Party’s billionaires, and don’t even know it. 

The situation is the same in any ‘democracy’. But no actual democracy is like this.

However, The rottenness of the billionaires’ picks could still end up defeating the billionaires. And here are examples of how:

On June 19th, the Washington Post bannered “Back home in South Bend, Buttigieg faces ‘his nightmare’”, and reported that:

A white police officer had shot and killed a black man early Sunday. Buttigieg canceled several days of campaign events — including an LGBTQ gala in New York — and rushed back to Indiana to “be with the South Bend community,” in the words of a campaign spokesman.

Instead of showcasing But­tigieg’s ability to lead through a crisis, however, the shooting is exposing what has long been considered an Achilles’ heel of his candidacy: his frosty relationship with South Bend’s black residents. … 

“How’s he handling it?” said Oliver Davis, the longest-serving black member of the South Bend Common Council. “Well, he talked to the media before the family. He skipped the family vigil, full of black residents. And then he then gave a speech to the police. So, how do you think that went over?” 

That speech was to the swearing-in of South Bend’s new police class. It had six members. All of them are white. They are to be the new people policing black neighorhoods in Mayor Buttigieg’s South Bend. How well is Buttigieg likely to perform in the largely Black South Carolina Democratic primary, on or around 29 February 2020? 

Also on June 19th, the New York Times headlined “Joe Biden and Democratic Rivals Exchange Attacks Over His Remarks on Segregationists: Mr. Biden’s fond remarks about dealing with segregationist senators are raising questions about both his political past and his political acumen now in dealing with it.” On that same day, Politico bannered “Biden comments trigger renewed scrutiny of his record on race” and reported that Biden was one of the leading U.S. Senators for criminalizing the types of narcotics that especially Blacks were addicted to, and that he was largely responsible for filling our prisons with Blacks. So: How well is Biden likely to perform in the largely Black South Carolina Democratic primary?

If those two candidates get eliminated on account of their too obviously not turning out to be like Obama but instead more like Hillary Clinton, then, perhaps, Sanders, or Warren, or the female Black, Harris, will come to dominate and possibly to win the nomination. But, if Sanders wins it, then none of the billionaires will be funding the Democratic Presidential campaign. But, if Trump’s campaign gets virtually all of the billionaires’ money, then could that fact alone sink his campaign, by exposing, even to some of Trump’s customary voters, that he doesn’t really represent their interests, after all? 

Author’s note: first posted at strategic-culture.org

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Americas

Trump’s New Wall? Mexico’s Southern Border

Lisdey Espinoza Pedraza

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For much of modern history, Mexico defined itself in opposition to the United States. In recent years, the two countries stepped up cooperation on almost all relevant issues, and the two nations are now deeply intertwined politically, economically and culturally. This is bound to change. After months of ignoring Donald Trump’s provocations, López Obrador reacted rapidly to Trump’s shakedown and agreed to a number of resolutions of extraordinary scope and urgency: the new Mexican administration agreed to deploy the country’s federal police to its southern border to crack down on immigration; and opened the door to the controversial “Remain in Mexico” policy that would turn Mexico into a Third Safe Country in less than a month from now.

As stated in the agreement, Mexico would take in all the refugees that the US decides to send back to Mexico to await resolution of their asylum process. This could take years, given the substantial immigration backlog in American courts. The agreement goes further: Mexico is responsible for the provision of education, health care and employment for such refugees. This could easily lead to a serious humanitarian crisis that Mexican institutions will be unable to deal with.

This approach contradicts previous Mexican presidential vows for regional development and humanitarian relief rather than confrontation and enforcement. Conditions on the ground in Mexico are far harsher than the Mexican Foreign Affairs Minister, Marcelo Ebrard and the President, Andrés Manuel López Obrador, would like to admit, and this is partly due to the current administration’s miscalculations: López Obrador has dramatically cut the budget for governmental agencies responsible for managing refugees and processing removals. Mexican border towns are also ill-equipped for handling transient migrant populations; and Mexico also faces other more systematic challenges, such as corruption and lack of rule of law enforcement. The new policy agreed with the American government is likely to result in a significant increase in claims filed for asylum in Mexico. Mexico’s immigration bureaucracies are utterly overwhelmed, and López Obrador’s misguided budget cuts have exacerbated their failings.

Mexico’s immigration policy is now bound by an immoral and unacceptable deal that will effectively turn Mexico into Trump’s border wall. The global system for the protection of refugees is based on the notion of shared responsibility among countries. It is very dangerous for the US to use Mexico as a pawn to set an example and ignore its international responsibility. This agreement also violates international law on refugees: Mexico is a life-threatening country for undocumented migrants. Human trafficking, recruitment for organised criminal organisations, abduction, extortion, sexual violence, and disappearances are some of the issues migrants face in Mexico. Finally, Mexico’s National Guard, the agency that will be in charge of monitoring the southern border, was created by López Obrador to tackle domestic crime. Its members have no training nor knowledge on immigration matters. It is an untested new military force that could end up creating more problems than the ones it is trying to solve.  Deploying agents to the border could also have a high political cost for the president.

The agreement with Trump gives López Obrador 45 days to show progress. If Mexico fails, Mexico will be forced to set in motion some version of Safe Third Country agreement, or face further tariff bullying from the US. This deal has been sold by the new Mexican administration as a victory over the US. More migrants, less money, extreme violence and a recalcitrant, unpredictable northern neighbour are the ingredients for a potential, impending refugee crisis, not a diplomatic victory.

Could Mexico have taken a different approach? Yes. Trump’s decision to impose tariffs would exacerbate the underlying causes of immigration in the region and do nothing to address it. His bullying to force Mexico to crack down on immigration was a cheap electoral ploy to mobilise its base with a view to winning the 2020 elections. This is nothing new. Trump is not seeking a solution; he is seeking a political gain. He built his first presidential campaign on an anti-Mexico and an anti-immigrant rhetoric. It worked in 2016, and he is planning to repeat the same formula.

The Mexican administration lack of knowledge on diplomatic matters, and their inability to play politics let a golden opportunity go. Using trade to bludgeon Mexico into compliance with an immigration crack down makes no sense: Mexico is not responsible for the increase in migratory flows. Central America’s poverty and violence trace back to American policies in the 1980s. Mexico is not responsible either for America’s famously dysfunctional immigration system. Trump’s economic threats against Mexico may not even have been legal: both the North American Free Trade Agreement (NAFTA), and the newly agreed US-Mexico-Canada Agreement (USMCA) require most trade between members to be tariff free.

Mexico could also have hit back with by levying tariffs that would have hurt swing-state voters, and in turn hurt Trump. This was the golden opportunity Mexico let slip from its hands. Mexico could have responded by hitting Trump where it hurts: Tariffs on American goods heading south. Mexico responded in a similar manner in June last year in response to the steel and aluminium tariffs. Mexico could have raised those tariffs each month in tandem with American levels.

This retaliation would have highlighted the gap between Trump’s anti-Mexican rhetoric and the underlying interdependence of the US and Mexico with stark consequences for the US presidential elections of 2020. Many of the biggest exporters to Mexico such as Arizona. Florida. California, Michigan and Illinois are swing states. New tariffs could have thrown Texas into recession and put its 38 electoral votes into play. It is all too late now, Mexico could have inadvertently helped Trump to get re-elected. Mexico has less than a month left to show some backbone and demand real American cooperation on the region’s shared challenges and rejecting Trump’s threats once and for all. The relationship between Mexico and the US could have been an example of cooperation under difficult conditions, but that would have required different American and Mexican presidents.

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