Wednesday, November 30, 2011

Meeting to Build An United Front Against Austerity in Detroit, Dec.5

For Immediate Release

Media Advisory

Please Forward Widely

Event: Moratorium NOW! Coalition Special Meeting on Detroit Austerity
Theme: Build A United Front Against the Takeover of Detroit
Date: Monday, December 5, 2011, 7:00-9:00pm
Location: 5920 Second Ave. at Antoinettee, North of WSU Campus
Contact: 313.671.3715




Detroit has again been threatened with massive layoffs and further cuts in city services in response to a “secret audit” report issued by
the accounting firm Ernst and Young. In a Nov. 16 press conference, Mayor Bing said that the audit report indicated that the city would
“run out of cash” by next spring.

Bing further stressed that if municipal unions and the people of Detroit rejected a new round of workforce reductions, a scale-down in
employee benefits and the gutting of services, he would request a review of the city finances by Governor Rick Snyder.

A state law passed last spring provides for the appointment of an “emergency manager” in fiscally distressed cities, counties and school
districts with the power to abrogate labor contracts, impose austerity measures and expropriate municipal pension funds.

Detroit city workers last year had a 10 percent wage reduction imposed on them. There have also been cuts in health care programs for
employees and their families.

City public services have been devastated over the last several years as Detroit seeks to stay above water amid massive debts that require escalating payments purportedly owed to the banks.

Already 2,000 civil service positions have been eliminated and the mayor and City Council are debating whether to lay off an additional
1,000-2,000 workers.

In response to these threats we should demand the repayment of over $220 million in state revenue sharing money to the city of Detroit. In addition, the Bing administration and the City Council should appeal to the federal government for increased funding for public
transportation to repair the 250 buses that are off the street and to purchase additional buses and build a light rail system for the city.

The politicians must go to the banks and demand a moratorium on debt-service payments in order to free-up hundreds of millions of tax dollars every year. Also we must draft an emergency bailout appeal to
the Obama administration and Congress; if the auto companies and banks have been bailed out then we are more than entitled to financial
relief to prevent our city and its resources from being seized by corporate vultures.

Please attend our special meeting on Monday, December 5 at 7:00pm at 5920 Second Avenue at Antoinette, just north of the WSU campus.

For more information call 313-671-3715

Detroit Rally to Stop the Eviction of Kyra Williams on the National Day to Fight Foreclosures, Dec. 6



TUESDAY, DECEMBER 6, 2011, 5:00 p.m.
(just north of E. Jefferson, east of Van Dyke)

Kyra Williams had a lease agreement on a property located at 1140 Hibbard, Detroit, MI 48214. Ms. Williams and the landlord had an agreement under which she was paying rent with an option to buy the property. Kyra Williams paid a significant amount of money in rent to the landlord. 25% of the monthly payment was being collected for the purchase of the property.

Kyra Williams received notice of an eviction hearing for Dec. 21, 2009. The reason for the eviction hearing was that unbeknownst to Ms. Williams, the landlord and owner of the home had defaulted on the mortgage for the property with CitiMortgage.

Kyra Williams attended the 36th District Court hearing and tried to explain she was the tenant in the property and had a lease with option to purchase the property. The lender CitiMortgage finally agreed to sell the property to Ms. Williams. She provided proof of funding and even made repairs to the property in anticipation of purchasing the home in conformance with this agreement.

Ms. Williams waited the final approval of the sale and a closing date. Instead of a closing date, Ms. Williams recently received a message that CitiMortgage changed its mind and was moving forward with the eviction. A writ of eviction has already been signed and Ms. Williams can be evicted at any time.

The City of Detroit has lost 250,000 people to foreclosures and evictions because of the actions of all the major banks, Citi, Bank of America, Chase, Wells Fargo, etc., who have shown utter disregard for the rights of individuals like Ms. Williams and the destruction to our communities that evictions and foreclosures have wrought.

The Moratorium NOW! Coalition, Occupy Detroit and Southeast Michigan Jobs with Justice are joining together to say enough is enough. We are prepared to do what is necessary to keep Ms. Williams in her home and defend others like her. We are joining with the Occupy Our Homes campaign which is staging actions all over the U.S. on Dec. 6. And we are demanding that the governors and President Obama immediately enact a two-year moratorium on all foreclosures and foreclosure-related evictions, especially in light of the trillion-dollar bailout to the banks which takes place with every foreclosure and eviction through the federal takeover of Fannie Mae and Freddie Mac.

Moratorium NOW! Coalition to Stop Foreclosures, Evictions & Utility Shutoffs Call 313-319-0870

US-backed Somali Military Headquarters in Mogadishu Attacked, 4 Killed

4 Somali soldiers killed after bomber attacks military headquarters in Mogadishu

By Associated Press
Wednesday, November 30, 8:36 AM

MOGADISHU, Somalia — A suicide bomber dressed in a military uniform triggered his explosives at Somalia’s army headquarters on Wednesday, killing four soldiers, officials said.

Gen. Abdikarim Yusuf Dhagabadan, the chief of Somalia’s armed forces, said he believed the bomber was targeting him for assassination as he was arriving for work. Dhagabadan said four soldiers died and 12 others were wounded, four seriously.

Al-Qaida-linked militants with al-Shabab have carried out several suicide bomb attacks in Mogadishu.

One soldier at the scene of the attack who gave his name only as Ali said the bomber feigned a stomachache outside the military headquarters in order to attract soldiers to him.

Dhagabadan said Somali forces opened fire on the bomber, killing him.

“A man walked toward me, then an armed soldier confronted him and ordered him to stop after which he turned around, took off his cap and turned toward the staff before he exploded,” said Dhagabadan, who admitted that Somali soldiers were caught off guard.

“It will not be an incident that will frighten us. I promise, God willing, to deal a big blow to al-Shabab, those troublemakers who made a habit to kill and humiliate the Somali people,” he said.

After the blast soldiers were on high alert, with fingers on the triggers of their guns. Blood stained nearby walls and human remains were scattered on the ground.

Somalia’s weak military is backed by 9,000 troops from Uganda and Burundi who are fighting al-Shabab as part of an African Union peacekeeping force.

Al-Shabab has largely been pushed out of Mogadishu but continue to carry out suicide and roadside bomb attacks. Aside from battles with the African Union, al-Shabab also faces attack from Kenyan troops who entered southern Somalia last month. Ethiopian troops have also been reported to be attacking al-Shabab from the west.

Somalia’s government on Wednesday condemned a string of attacks and explosions in Mogadishu.

The government said four recent bomb attacks — excluding Wednesday’s bombing — have killed five people. One bomb was planted near a secondary school, another near a university. A bomb even went off in a Mogadishu hospital, wounding two people.

“After having been defeated in the battlefield they are engaged in a campaign of terrorizing the civilian population,” said Information Minister Abdulkadir Hussein Mohamed. “It should be clearly evident to everybody that al-Shabab are nothing more than (murderers) of children and civilians in hospitals and schools.”

Meanwhile, the U.N. said because of logistical and security challenges, 23 percent fewer people in need of food aid because of Somalia’s drought and famine received food assistance in the month of November.

It said 2.6 million people were reached in October, while the figure in November was 1.45 million.
Associated Press reporter Malkhadir M. Muhumed in Nairobi, Kenya contributed.

"Out of Africa" Theory May Need Revision

November 30, 2011 6:34 PM

"Out of Africa" theory may need a rewrite

Newfound stone artifacts suggest humankind left Africa traveling through the Arabian Peninsula instead of hugging its coasts, as long thought, researchers say.

Modern humans first arose about 200,000 years ago in Africa. When and how our lineage then dispersed has long proven controversial, but geneticists have suggested this exodus started between 40,000 and 70,000 years ago.

The currently accepted theory is that the exodus from Africa traced Arabia's shores, rather than passing through its now-arid interior.

However, stone artifacts at least 100,000 years old from the Arabian Desert, revealed in January 2011, hinted that modern humans might have begun our march across the globe earlier than once suspected.

Now, more-than-100 newly discovered sites in the Sultanate of Oman apparently confirm that modern humans left Africa through Arabia long before genetic evidence suggests. Oddly, these sites are located far inland, away from the coasts.

"After a decade of searching in southern Arabia for some clue that might help us understand early human expansion, at long last we've found the smoking gun of their exit from Africa," said lead researcher Jeffrey Rose, a paleolithic archaeologist at the University of Birmingham in England. "What makes this so exciting is that the answer is a scenario almost never considered."

Arabian artifacts

The international team of archaeologists and geologists made their discovery in the Dhofar Mountains of southern Oman, nestled in the southeastern corner of the Arabian Peninsula.

"The coastal expansion hypothesis looks reasonable on paper, but there is simply no archaeological evidence to back it up," said researcher Anthony Marks of Southern Methodist University, referring to the fact that an exodus by the coast, where one has access to resources such as seafood, might make more sense than tramping across the desert..

On the last day of the research team's 2010 field season, the scientists went to the final place on their list, a site on a hot, windy, dry plateau near a river channel that was strewn with stone artifacts. Such artifacts are common in Arabia, but until now the ones seen were usually relatively young in age. Upon closer examination, Rose recalled asking, "Oh my God, these are Nubians — what the heck are these doing here?"

The 100-to-200 artifacts they found there were of a style dubbed Nubian Middle Stone Age, well-known throughout the Nile Valley, where they date back about 74,000-to-128,000 years. Scientists think ancient craftsmen would have shaped the artifacts by striking flakes off flint, leading to distinctive triangular pieces. This is the first time such artifacts have been found outside of Africa.

Subsequent field work turned up dozens of sites with similar artifacts. Using a technique known as optically stimulated luminescence dating, which measures the minute amount of light long-buried objects can emit, to see how long they have been interred, the researchers estimate the artifacts are about 106,000 years old, exactly what one might expect from Nubian Middle Stone Age artifacts and far earlier than conventional dates for the exodus from Africa.

"It's all just incredibly exciting," Rose said.

Arabian spring?

Finding so much evidence of life in what is now a relatively barren desert supports the importance of field work, according to the researchers.

"Here we have an example of the disconnect between theoretical models versus real evidence on the ground," Marks said.

However, when these artifacts were made, instead of being desolate, Arabia was very wet, with copious rain falling across the peninsula, transforming its barren deserts to fertile, sprawling grasslands with lots of animals to hunt, the researchers explained.

"For a while, South Arabia became a verdant paradise rich in resources — large game, plentiful fresh water, and high-quality flint with which to make stone tools," Rose said.

Instead of hugging the coast, early modern humans might therefore have spread from Africa into Arabia along river networks that would've acted like today's highways, researchers suggested. There would have been plenty of large game present, such as gazelles, antelopes and ibexes, which would have been appealing to early modern humans used to hunting on the savannas of Africa.

"The genetic signature that we've seen so far of an exodus 70,000 years ago might not be out of Africa, but out of Arabia," Rose told LiveScience.

So far the researchers have not discovered the remains of humans or any other animals at the site. Could these tools have been made by now-extinct human lineages such as Neanderthals that left Africa before modern humans did? Not likely, Rose said, as all the Nubian Middle Stone Age tools seen in Africa are associated with our ancestors.

It remains a mystery as to how early modern humans from Africa crossed the Red Sea, since they did not appear to enter the Arabian Peninsula from the north, through the Sinai Peninsula, Rose explained. "Back then, there was no land bridge in the south of Arabia, but the sea level might not have been that low," he said. Archaeologists will have to continue combing the deserts of southern Arabia for more of what the researchers called a "trail of stone breadcrumbs."

The scientists detailed their findings online Nov. 30 in the journal PLoS ONE.

Read more:

Zimbabwe Beauty Pageant Gears Up In Harare

Miss Harare preps a gear up

Wednesday, 30 November 2011 00:00

Harare’s finest . . .contestants vying for the Miss Harare crown

Entertainment Reporter
Zimbabwe Herald

Preparations for this year's edition of the prestigious Miss Harare beauty pageant are at an advanced stage with the organisers promising a red carpet event.

Running under the theme "I am Zimbabwean", the final showdown has been set for December 23, at the 7Arts Theatre in Avondale.

The scouting phase which saw two rounds of auditions has been completed with 30 beauties making it into camp after going through an intense selection process.

The selection criterion for the girls was rather strict with a minimum height requirement of 1,67m being set.

Age was another aspect and only those 24 years and below were allowed the chance to face a panel of judges who grilled the aspiring queens, testing their credibility to become ambassadors of the City of Harare.

Twenty-seven out of 64 participants qualified in the first round of auditions, which were held on November 12. Another 11 girls were selected in the second round, bringing to 38 the total number of models who qualified.

However, they later went through another round of selection which saw 30 models remaining.

Co-ordinator of the pageant Deborah Chidavaenzi - a former model - said that preparations for the grand finale were now in motion.

"We are putting in place the final touches and seeing through a couple of modalities and logistics to ensure that we hold an explosive event.

"At the moment we are finalising negotiations with artistes who are going to perform during the event," she said. The girls are set to start their tour of Harare - the Sunshine City - very soon, in which they will have road shows and familiarisation programmes.

Organisers of the event have also pencilled in a fund-raising dinner on December 16, from which funds will be channelled towards the Cancer Association of Zimbabwe, which the Miss Zimbabwe Trust has aligned itself with by supporting cervical cancer awareness.

Out of the 30 contestants vying for the Miss Harare title, only the top four models will go through to participate in the Miss Zimbabwe national finals.

Banks Given Trillions While Unemployment, Poverty Increases

The $7 trillion secret loan program

The government and big banks should be punished for deceiving the public about their hush-hush bailout scheme.

By Eliot Spitzer
Posted Wednesday, Nov. 30, 2011, at 1:34 PM ET

The government and the big banks deceived the public about their $7 trillion secret loan program. They should be punished.

Imagine you walked into a bank, applied for a personal line of credit, and filled out all the paperwork claiming to have no debts and an income of $200,000 per year. The bank, based on these representations, extended you the line of credit. Then, three years later, after fighting disclosure all the way, you were forced by a court to tell the truth: At the time you made the statements to the bank, you actually were unemployed, you had a $1 million mortgage on your house on which you had failed to make payments for six months, and you hadn’t paid even the minimum on your credit-card bills for three months. Do you think the bank would just say: Never mind, don’t worry about it? Of course not. Whether or not you had paid back the personal line of credit, three FBI agents would be at your door within hours.

Yet this is exactly what the major American banks have done to the public. During the deepest, darkest period of the financial cataclysm, the CEOs of major banks maintained in statements to the public, to the market at large, and to their own shareholders that the banks were in good financial shape, didn’t want to take TARP funds, and that the regulatory framework governing our banking system should not be altered. Trust us, they said. Yet, unknown to the public and the Congress, these same banks had been borrowing massive amounts from the government to remain afloat. The total numbers are staggering: $7.7 trillion of credit—one-half of the GDP of the entire nation. $460 billion was lent to J.P. Morgan, Bank of America, Citibank, Wells Fargo, Goldman Sachs, and Morgan Stanley alone—without anybody other than a few select officials at the Fed and the Treasury knowing. This was perhaps the single most massive allocation of capital from public to private hands in our history, and nobody was told. This was not TARP: This was secret Fed lending. And although it has since been repaid, it is clear why the banks didn’t want us to know about it: They didn’t want to admit the magnitude of their financial distress.

The banks’ claims of financial stability and solvency appear at a minimum to have been misleading—and may have been worse. Misleading statements and deception of this sort would ordinarily put a small-market player or borrower on the wrong end of a criminal investigation.

So where are the inquiries into the false statements made by the bank CEOs? And where are the inquiries about the Fed and Treasury officials who stood by silently as bank representatives made claims that were false, misleading, or worse?

Only now, because of superb analysis done by Bloomberg reporters—who litigated against the Fed and the banks for years to get the information—are we getting a full picture of the Fed and Treasury lending. The reporters also calculated that recipient banks and other borrowers benefited by approximately $13 billion simply by taking advantage of the “spread” between their cost of capital in these almost interest-free loans and their ability to lend the capital.

In addition to the secrecy, what is appalling is that these loans were made with no strings attached, no conditions, and no negotiation to achieve any broader public purpose. Even if one accepts the notion that the stability of the financial system could not be sacrificed, those who dispensed trillions of dollars to private parties made no apparent effort to impose even minimal obligations to condition the loans on the structural reforms needed to prevent another crisis, made no effort to require that those responsible for creating the crisis be relieved of their jobs, took zero steps towards the genuine mortgage-reform that is so necessary to begin a process of economic renewal. The dollars lent were simply a free bridge loan so the banks could push onto others the responsibility for the banks’ own risk-taking.

If ever there was an event to justify the darkest, most conspiratorial view held by many that the alliance of big money on Wall Street and big government produces nothing but secret deals that profit insiders—this is it.

So what to do? The revelations of the secret loan program may provide the opportunity for Occupy Wall Street to suggest a few concrete steps that would be difficult to oppose.

First: Demand a hearing where the bank executives have to answer questions—under oath—about the actual negotiations, or lack thereof, that led to these loans; about the actual condition of each of the borrowing banks and whether that condition differed from the public statements made by the banks at the time.

Second: Require the recipient banks to use this previously undisclosed gift—the profit they made by investing this almost interest-free money—to write down the value of mortgages of those who are underwater. The loans to the banks were meant to solve a short-term liquidity problem, not be a source of profits to fund bonuses. Take back the profits and put them to a public use.

Third: Require the government officials responsible for authorizing these loans to explain why there was no effort made to condition these loans on changes in policy that would protect the public going forward.

Fourth: Ask congress to examine every filing and statement made to Congress by the banks about their financial condition and their indebtedness to see if any misrepresentations were made in an effort to hide these trillions of dollars of loans. Misleading Congress can be a felony, and willful deception of the Congress to hide the magnitude of the public bailouts should not go unprosecuted.

Finally: Demand that politicians return all contributions made by the institutions that got hidden loans. Pressure the politicians who continue to feed from the trough of Wall Street, even as they know all too well how the banks and others have gamed the system and the public.

Secret Fed Loans Gave Banks $13 Billion Undisclosed to Congress

By Bob Ivry, Bradley Keoun and Phil Kuntz - Nov 27, 2011 Bloomberg Markets Magazine

The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.

Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. While Fed officials say that almost all of the loans were repaid and there have been no losses, details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.

‘Change Their Votes’

“When you see the dollars the banks got, it’s hard to make the case these were successful institutions,” says Sherrod Brown, a Democratic Senator from Ohio who in 2010 introduced an unsuccessful bill to limit bank size. “This is an issue that can unite the Tea Party and Occupy Wall Street. There are lawmakers in both parties who would change their votes now.”

The size of the bailout came to light after Bloomberg LP, the parent of Bloomberg News, won a court case against the Fed and a group of the biggest U.S. banks called Clearing House Association LLC to force lending details into the open.

The Fed, headed by Chairman Ben S. Bernanke, argued that revealing borrower details would create a stigma -- investors and counterparties would shun firms that used the central bank as lender of last resort -- and that needy institutions would be reluctant to borrow in the next crisis. Clearing House Association fought Bloomberg’s lawsuit up to the U.S. Supreme Court, which declined to hear the banks’ appeal in March 2011.

$7.77 Trillion

The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.

“TARP at least had some strings attached,” says Brad Miller, a North Carolina Democrat on the House Financial Services Committee, referring to the program’s executive-pay ceiling. “With the Fed programs, there was nothing.”

Bankers didn’t disclose the extent of their borrowing. On Nov. 26, 2008, then-Bank of America (BAC) Corp. Chief Executive Officer Kenneth D. Lewis wrote to shareholders that he headed “one of the strongest and most stable major banks in the world.” He didn’t say that his Charlotte, North Carolina-based firm owed the central bank $86 billion that day.

‘Motivate Others’

JPMorgan Chase & Co. CEO Jamie Dimon told shareholders in a March 26, 2010, letter that his bank used the Fed’s Term Auction Facility “at the request of the Federal Reserve to help motivate others to use the system.” He didn’t say that the New York-based bank’s total TAF borrowings were almost twice its cash holdings or that its peak borrowing of $48 billion on Feb. 26, 2009, came more than a year after the program’s creation.

Howard Opinsky, a spokesman for JPMorgan (JPM), declined to comment about Dimon’s statement or the company’s Fed borrowings. Jerry Dubrowski, a spokesman for Bank of America, also declined to comment.

The Fed has been lending money to banks through its so- called discount window since just after its founding in 1913. Starting in August 2007, when confidence in banks began to wane, it created a variety of ways to bolster the financial system with cash or easily traded securities. By the end of 2008, the central bank had established or expanded 11 lending facilities catering to banks, securities firms and corporations that couldn’t get short-term loans from their usual sources.

‘Core Function’

“Supporting financial-market stability in times of extreme market stress is a core function of central banks,” says William B. English, director of the Fed’s Division of Monetary Affairs. “Our lending programs served to prevent a collapse of the financial system and to keep credit flowing to American families and businesses.”

The Fed has said that all loans were backed by appropriate collateral. That the central bank didn’t lose money should “lead to praise of the Fed, that they took this extraordinary step and they got it right,” says Phillip Swagel, a former assistant Treasury secretary under Henry M. Paulson and now a professor of international economic policy at the University of Maryland.

The Fed initially released lending data in aggregate form only. Information on which banks borrowed, when, how much and at what interest rate was kept from public view.

The secrecy extended even to members of President George W. Bush’s administration who managed TARP. Top aides to Paulson weren’t privy to Fed lending details during the creation of the program that provided crisis funding to more than 700 banks, say two former senior Treasury officials who requested anonymity because they weren’t authorized to speak.

Big Six

The Treasury Department relied on the recommendations of the Fed to decide which banks were healthy enough to get TARP money and how much, the former officials say. The six biggest U.S. banks, which received $160 billion of TARP funds, borrowed as much as $460 billion from the Fed, measured by peak daily debt calculated by Bloomberg using data obtained from the central bank. Paulson didn’t respond to a request for comment.

The six -- JPMorgan, Bank of America, Citigroup Inc. (C), Wells Fargo & Co. (WFC), Goldman Sachs Group Inc. (GS) and Morgan Stanley -- accounted for 63 percent of the average daily debt to the Fed by all publicly traded U.S. banks, money managers and investment- services firms, the data show. By comparison, they had about half of the industry’s assets before the bailout, which lasted from August 2007 through April 2010. The daily debt figure excludes cash that banks passed along to money-market funds.

Bank Supervision

While the emergency response prevented financial collapse, the Fed shouldn’t have allowed conditions to get to that point, says Joshua Rosner, a banking analyst with Graham Fisher & Co. in New York who predicted problems from lax mortgage underwriting as far back as 2001. The Fed, the primary supervisor for large financial companies, should have been more vigilant as the housing bubble formed, and the scale of its lending shows the “supervision of the banks prior to the crisis was far worse than we had imagined,” Rosner says.

Bernanke in an April 2009 speech said that the Fed provided emergency loans only to “sound institutions,” even though its internal assessments described at least one of the biggest borrowers, Citigroup, as “marginal.”

On Jan. 14, 2009, six days before the company’s central bank loans peaked, the New York Fed gave CEO Vikram Pandit a report declaring Citigroup’s financial strength to be “superficial,” bolstered largely by its $45 billion of Treasury funds. The document was released in early 2011 by the Financial Crisis Inquiry Commission, a panel empowered by Congress to probe the causes of the crisis.

‘Need Transparency’

Andrea Priest, a spokeswoman for the New York Fed, declined to comment, as did Jon Diat, a spokesman for Citigroup.

“I believe that the Fed should have independence in conducting highly technical monetary policy, but when they are putting taxpayer resources at risk, we need transparency and accountability,” says Alabama Senator Richard Shelby, the top Republican on the Senate Banking Committee.

Judd Gregg, a former New Hampshire senator who was a lead Republican negotiator on TARP, and Barney Frank, a Massachusetts Democrat who chaired the House Financial Services Committee, both say they were kept in the dark.

“We didn’t know the specifics,” says Gregg, who’s now an adviser to Goldman Sachs.

“We were aware emergency efforts were going on,” Frank says. “We didn’t know the specifics.”

Disclose Lending

Frank co-sponsored the Dodd-Frank Wall Street Reform and Consumer Protection Act, billed as a fix for financial-industry excesses. Congress debated that legislation in 2010 without a full understanding of how deeply the banks had depended on the Fed for survival.

It would have been “totally appropriate” to disclose the lending data by mid-2009, says David Jones, a former economist at the Federal Reserve Bank of New York who has written four books about the central bank.

“The Fed is the second-most-important appointed body in the U.S., next to the Supreme Court, and we’re dealing with a democracy,” Jones says. “Our representatives in Congress deserve to have this kind of information so they can oversee the Fed.”

The Dodd-Frank law required the Fed to release details of some emergency-lending programs in December 2010. It also mandated disclosure of discount-window borrowers after a two- year lag.

Protecting TARP

TARP and the Fed lending programs went “hand in hand,” says Sherrill Shaffer, a banking professor at the University of Wyoming in Laramie and a former chief economist at the New York Fed. While the TARP money helped insulate the central bank from losses, the Fed’s willingness to supply seemingly unlimited financing to the banks assured they wouldn’t collapse, protecting the Treasury’s TARP investments, he says.

“Even though the Treasury was in the headlines, the Fed was really behind the scenes engineering it,” Shaffer says.

Congress, at the urging of Bernanke and Paulson, created TARP in October 2008 after the bankruptcy of Lehman Brothers Holdings Inc. made it difficult for financial institutions to get loans. Bank of America and New York-based Citigroup each received $45 billion from TARP. At the time, both were tapping the Fed. Citigroup hit its peak borrowing of $99.5 billion in January 2009, while Bank of America topped out in February 2009 at $91.4 billion.

No Clue

Lawmakers knew none of this.

They had no clue that one bank, New York-based Morgan Stanley (MS), took $107 billion in Fed loans in September 2008, enough to pay off one-tenth of the country’s delinquent mortgages. The firm’s peak borrowing occurred the same day Congress rejected the proposed TARP bill, triggering the biggest point drop ever in the Dow Jones Industrial Average. (INDU) The bill later passed, and Morgan Stanley got $10 billion of TARP funds, though Paulson said only “healthy institutions” were eligible.

Mark Lake, a spokesman for Morgan Stanley, declined to comment, as did spokesmen for Citigroup and Goldman Sachs.

Had lawmakers known, it “could have changed the whole approach to reform legislation,” says Ted Kaufman, a former Democratic Senator from Delaware who, with Brown, introduced the bill to limit bank size.

Moral Hazard

Kaufman says some banks are so big that their failure could trigger a chain reaction in the financial system. The cost of borrowing for so-called too-big-to-fail banks is lower than that of smaller firms because lenders believe the government won’t let them go under. The perceived safety net creates what economists call moral hazard -- the belief that bankers will take greater risks because they’ll enjoy any profits while shifting losses to taxpayers.

If Congress had been aware of the extent of the Fed rescue, Kaufman says, he would have been able to line up more support for breaking up the biggest banks.

Byron L. Dorgan, a former Democratic senator from North Dakota, says the knowledge might have helped pass legislation to reinstate the Glass-Steagall Act, which for most of the last century separated customer deposits from the riskier practices of investment banking.

“Had people known about the hundreds of billions in loans to the biggest financial institutions, they would have demanded Congress take much more courageous actions to stop the practices that caused this near financial collapse,” says Dorgan, who retired in January.

Getting Bigger

Instead, the Fed and its secret financing helped America’s biggest financial firms get bigger and go on to pay employees as much as they did at the height of the housing bubble.

Total assets held by the six biggest U.S. banks increased 39 percent to $9.5 trillion on Sept. 30, 2011, from $6.8 trillion on the same day in 2006, according to Fed data.

For so few banks to hold so many assets is “un-American,” says Richard W. Fisher, president of the Federal Reserve Bank of Dallas. “All of these gargantuan institutions are too big to regulate. I’m in favor of breaking them up and slimming them down.”

Employees at the six biggest banks made twice the average for all U.S. workers in 2010, based on Bureau of Labor Statistics hourly compensation cost data. The banks spent $146.3 billion on compensation in 2010, or an average of $126,342 per worker, according to data compiled by Bloomberg. That’s up almost 20 percent from five years earlier compared with less than 15 percent for the average worker. Average pay at the banks in 2010 was about the same as in 2007, before the bailouts.

‘Wanted to Pretend’

“The pay levels came back so fast at some of these firms that it appeared they really wanted to pretend they hadn’t been bailed out,” says Anil Kashyap, a former Fed economist who’s now a professor of economics at the University of Chicago Booth School of Business. “They shouldn’t be surprised that a lot of people find some of the stuff that happened totally outrageous.”

Bank of America took over Merrill Lynch & Co. at the urging of then-Treasury Secretary Paulson after buying the biggest U.S. home lender, Countrywide Financial Corp. When the Merrill Lynch purchase was announced on Sept. 15, 2008, Bank of America had $14.4 billion in emergency Fed loans and Merrill Lynch had $8.1 billion. By the end of the month, Bank of America’s loans had reached $25 billion and Merrill Lynch’s had exceeded $60 billion, helping both firms keep the deal on track.

Prevent Collapse

Wells Fargo bought Wachovia Corp., the fourth-largest U.S. bank by deposits before the 2008 acquisition. Because depositors were pulling their money from Wachovia, the Fed channeled $50 billion in secret loans to the Charlotte, North Carolina-based bank through two emergency-financing programs to prevent collapse before Wells Fargo could complete the purchase.

“These programs proved to be very successful at providing financial markets the additional liquidity and confidence they needed at a time of unprecedented uncertainty,” says Ancel Martinez, a spokesman for Wells Fargo.

JPMorgan absorbed the country’s largest savings and loan, Seattle-based Washington Mutual Inc., and investment bank Bear Stearns Cos. The New York Fed, then headed by Timothy F. Geithner, who’s now Treasury secretary, helped JPMorgan complete the Bear Stearns deal by providing $29 billion of financing, which was disclosed at the time. The Fed also supplied Bear Stearns with $30 billion of secret loans to keep the company from failing before the acquisition closed, central bank data show. The loans were made through a program set up to provide emergency funding to brokerage firms.

‘Regulatory Discretion’

“Some might claim that the Fed was picking winners and losers, but what the Fed was doing was exercising its professional regulatory discretion,” says John Dearie, a former speechwriter at the New York Fed who’s now executive vice president for policy at the Financial Services Forum, a Washington-based group consisting of the CEOs of 20 of the world’s biggest financial firms. “The Fed clearly felt it had what it needed within the requirements of the law to continue to lend to Bear and Wachovia.”

The bill introduced by Brown and Kaufman in April 2010 would have mandated shrinking the six largest firms.

“When a few banks have advantages, the little guys get squeezed,” Brown says. “That, to me, is not what capitalism should be.”

Kaufman says he’s passionate about curbing too-big-to-fail banks because he fears another crisis.

‘Can We Survive?’

“The amount of pain that people, through no fault of their own, had to endure -- and the prospect of putting them through it again -- is appalling,” Kaufman says. “The public has no more appetite for bailouts. What would happen tomorrow if one of these big banks got in trouble? Can we survive that?”

Lobbying expenditures by the six banks that would have been affected by the legislation rose to $29.4 million in 2010 compared with $22.1 million in 2006, the last full year before credit markets seized up -- a gain of 33 percent, according to, a research group that tracks money in U.S. politics. Lobbying by the American Bankers Association, a trade organization, increased at about the same rate, reported.

Lobbyists argued the virtues of bigger banks. They’re more stable, better able to serve large companies and more competitive internationally, and breaking them up would cost jobs and cause “long-term damage to the U.S. economy,” according to a Nov. 13, 2009, letter to members of Congress from the FSF.

The group’s website cites Nobel Prize-winning economist Oliver E. Williamson, a professor emeritus at the University of California, Berkeley, for demonstrating the greater efficiency of large companies.

‘Serious Burden’

In an interview, Williamson says that the organization took his research out of context and that efficiency is only one factor in deciding whether to preserve too-big-to-fail banks.

“The banks that were too big got even bigger, and the problems that we had to begin with are magnified in the process,” Williamson says. “The big banks have incentives to take risks they wouldn’t take if they didn’t have government support. It’s a serious burden on the rest of the economy.”

Dearie says his group didn’t mean to imply that Williamson endorsed big banks.

Top officials in President Barack Obama’s administration sided with the FSF in arguing against legislative curbs on the size of banks.

Geithner, Kaufman

On May 4, 2010, Geithner visited Kaufman in his Capitol Hill office. As president of the New York Fed in 2007 and 2008, Geithner helped design and run the central bank’s lending programs. The New York Fed supervised four of the six biggest U.S. banks and, during the credit crunch, put together a daily confidential report on Wall Street’s financial condition. Geithner was copied on these reports, based on a sampling of e- mails released by the Financial Crisis Inquiry Commission.

At the meeting with Kaufman, Geithner argued that the issue of limiting bank size was too complex for Congress and that people who know the markets should handle these decisions, Kaufman says. According to Kaufman, Geithner said he preferred that bank supervisors from around the world, meeting in Basel, Switzerland, make rules increasing the amount of money banks need to hold in reserve. Passing laws in the U.S. would undercut his efforts in Basel, Geithner said, according to Kaufman.

Anthony Coley, a spokesman for Geithner, declined to comment.

‘Punishing Success’

Lobbyists for the big banks made the winning case that forcing them to break up was “punishing success,” Brown says. Now that they can see how much the banks were borrowing from the Fed, senators might think differently, he says.

The Fed supported curbing too-big-to-fail banks, including giving regulators the power to close large financial firms and implementing tougher supervision for big banks, says Fed General Counsel Scott G. Alvarez. The Fed didn’t take a position on whether large banks should be dismantled before they get into trouble.

Dodd-Frank does provide a mechanism for regulators to break up the biggest banks. It established the Financial Stability Oversight Council that could order teetering banks to shut down in an orderly way. The council is headed by Geithner.

“Dodd-Frank does not solve the problem of too big to fail,” says Shelby, the Alabama Republican. “Moral hazard and taxpayer exposure still very much exist.”

Below Market

Dean Baker, co-director of the Center for Economic and Policy Research in Washington, says banks “were either in bad shape or taking advantage of the Fed giving them a good deal. The former contradicts their public statements. The latter -- getting loans at below-market rates during a financial crisis -- is quite a gift.”

The Fed says it typically makes emergency loans more expensive than those available in the marketplace to discourage banks from abusing the privilege. During the crisis, Fed loans were among the cheapest around, with funding available for as low as 0.01 percent in December 2008, according to data from the central bank and money-market rates tracked by Bloomberg.

The Fed funds also benefited firms by allowing them to avoid selling assets to pay investors and depositors who pulled their money. So the assets stayed on the banks’ books, earning interest.

Banks report the difference between what they earn on loans and investments and their borrowing expenses. The figure, known as net interest margin, provides a clue to how much profit the firms turned on their Fed loans, the costs of which were included in those expenses. To calculate how much banks stood to make, Bloomberg multiplied their tax-adjusted net interest margins by their average Fed debt during reporting periods in which they took emergency loans.

Added Income

The 190 firms for which data were available would have produced income of $13 billion, assuming all of the bailout funds were invested at the margins reported, the data show.

The six biggest U.S. banks’ share of the estimated subsidy was $4.8 billion, or 23 percent of their combined net income during the time they were borrowing from the Fed. Citigroup would have taken in the most, with $1.8 billion.

“The net interest margin is an effective way of getting at the benefits that these large banks received from the Fed,” says Gerald A. Hanweck, a former Fed economist who’s now a finance professor at George Mason University in Fairfax, Virginia.

While the method isn’t perfect, it’s impossible to state the banks’ exact profits or savings from their Fed loans because the numbers aren’t disclosed and there isn’t enough publicly available data to figure it out.

Opinsky, the JPMorgan spokesman, says he doesn’t think the calculation is fair because “in all likelihood, such funds were likely invested in very short-term investments,” which typically bring lower returns.

Standing Access

Even without tapping the Fed, the banks get a subsidy by having standing access to the central bank’s money, says Viral Acharya, a New York University economics professor who has worked as an academic adviser to the New York Fed.

“Banks don’t give lines of credit to corporations for free,” he says. “Why should all these government guarantees and liquidity facilities be for free?”

In the September 2008 meeting at which Paulson and Bernanke briefed lawmakers on the need for TARP, Bernanke said that if nothing was done, “unemployment would rise -- to 8 or 9 percent from the prevailing 6.1 percent,” Paulson wrote in “On the Brink” (Business Plus, 2010).

Occupy Wall Street

The U.S. jobless rate hasn’t dipped below 8.8 percent since March 2009, 3.6 million homes have been foreclosed since August 2007, according to data provider RealtyTrac Inc., and police have clashed with Occupy Wall Street protesters, who say government policies favor the wealthiest citizens, in New York, Boston, Seattle and Oakland, California.

The Tea Party, which supports a more limited role for government, has its roots in anger over the Wall Street bailouts, says Neil M. Barofsky, former TARP special inspector general and a Bloomberg Television contributing editor.

“The lack of transparency is not just frustrating; it really blocked accountability,” Barofsky says. “When people don’t know the details, they fill in the blanks. They believe in conspiracies.”

In the end, Geithner had his way. The Brown-Kaufman proposal to limit the size of banks was defeated, 60 to 31. Bank supervisors meeting in Switzerland did mandate minimum reserves that institutions will have to hold, with higher levels for the world’s largest banks, including the six biggest in the U.S. Those rules can be changed by individual countries.

They take full effect in 2019.

Meanwhile, Kaufman says, “we’re absolutely, totally, 100 percent not prepared for another financial crisis.”

To contact the reporters on this story: Bob Ivry in New York at; Bradley Keoun in New York at; Phil Kuntz in New York at

To contact the editors responsible for this story: Gary Putka at; David Scheer at

Secret Funding Made Big Banks Bigger

November 29, 2011 at 3:16 PM

Using FOIA, Bloomberg Obtains 29,000 Pages of Fed Papers

"The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret [34]. Now, the rest of the world can see what it was missing," Bob Ivry, Bradley Keoun and Phil Kuntz of Bloomberg Markets magazine reported on Sunday.

"The Fed didn't tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn't mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed's below-market rates, Bloomberg Markets magazine reports in its January issue.

"Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

"A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. While Fed officials say that almost all of the loans were repaid and there have been no losses, details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.

" 'When you see the dollars the banks got, it's hard to make the case these were successful institutions,' says Sherrod Brown, a Democratic Senator from Ohio who in 2010 introduced an unsuccessful bill to limit bank size. 'This is an issue that can unite the Tea Party and Occupy Wall Street. There are lawmakers in both parties who would change their votes now.'

"The size of the bailout came to light after Bloomberg LP, the parent of Bloomberg News, won a court case against the Fed and a group of the biggest U.S. banks called Clearing House Association LLC to force lending details into the open."

Central Banks Aim Bazooka Of Cheap Dollars At European Banks

I published a column yesterday about some relative recent academic research which suggests that deleveraging by European banks could have a drastic contractionary impact on credit conditions in the United States. One possible solution to that, being implemented today by the Federal Reserve Bank in coordination with other major central banks, is to drastically lower the price that foreign central banks have to pay to obtain dollars. Then those central banks can pass the cheap dollars on to the banks they supervise. Will this work? Is it fair? Is it a good idea?

THE GOOD: In terms of credit conditions in the United States, this should work. Foreign banks hold about half the dollars in circulation, and they make loans based on those holdings. Those loans largely go to American households or firms operating in the United States since this, at the end of the day, is where you buy things with dollars. If they started hoarding dollars instead of using them as the basis for loans, that would have thrown a ton of sand into the gears of the American economy.

THE BAD: This appears to be driving the Euro/Dollar exchange rate up which is going to make the underlying economic problems in Spain, Italy, Greece, Portugal, and even France worse. There's still a need for the European Central Bank to target sovereign debt yields and for Germany to consider buying more stuff as an appealing alternative to bailouts. Meanwhile it continues to be the case that both the Fed and the ECB would do well to start adopting more growth-oriented targets for medium-term monetary policy. All these sporadic "emergency" actions leave everyone scratching their heads about the future.

THE UGLY: As with the Federal Reserve's secret lending to American banks in late 2008 actions of this sort raise fundamental issues about fairness. Handing out cheap money to European banks will help bolster them, which will help stabilize the economy. But the exact same logic applies to all sorts of distressed institutions in the world today. Where's the free money for American municipalities? Where's the free money for debt-constrained households? Beyond the operational details, where's the targeting of full employment? In its November meeting, the Fed's Open Market Committee rejected NGDP targeting as too risky and unorthodox to be worth trying even though it might create millions of new jobs. Then European banks run into trouble, and suddenly nobody cares about being risky and unorthodox.

At the end of the day the conjunction of these kind of actions with continued inability to return us to full employment makes it all but inevitable that the "End The Fed" crowd's voices are going to grow louder. The world's central banks badly need to wake up and realize that it's time to go "all in" on doing everything the possibly can to solve the developed world's demand shortfall.

Los Angeles Cops Violently Bust Up Anti-Capitalist Protest

LAPD too violent, some Occupy L.A. protesters allege

November 30, 2011 | 9:11 am
LA Now

Los Angeles police are being praised for their planning, outreach and judicious use of force in ousting the Occupy L.A. encampment Wednesday morning, but a few protesters are reporting more physical confrontations with some of the 1,400 officers.

In a KCAL 9 video, now posted on YouTube, Tyson Heder, 25, was taking pictures of the eviction, when a police officer shoved him away. The video showed Heder then standing up, yelling at the officer, then being forced to the ground by several policemen.

His sister, Christy Collins, said Heder was in custody Wednesday morning.

Collins, who lives in Albany, N.Y., said she got an emotional phone message from him some time after his arrest. He posted on Facebook, "They beat me and stole my camera." Collin said her brother had not been an Occupy participant previously and apparently went to the encampment Tuesday night just to take pictures.

"I do think it was horrible and excessive," Collins said after watching a video of the encounter. "But I have to say, I was relieved it wasn't worse once I saw it."

Ruth Fowler, an Occupy protester, blogged that officers beat some protesters who were running away from them on Alameda Street between 1st and 2nd streets.

"The violence I witnessed was pretty intense," she wrote. Officers "wanted to hurt people. They were running and beating people who were simply RUNNING away, trying to escape!"

Still, most had praise for authorities, who arrested more than 200 protesters.

Pam Noles, an observer with the National Lawyers Guild, which has advised the protesters, gave high marks to police and protesters during the eviction.

"I would have to say honestly that the LAPD had their A game on," Noles said, adding that protesters should also be given credit for remaining nonviolent and not giving police any excuse to use force. "I was really proud of the occupiers who stood on message, stood on discipline and stood on faith. Both sides did what they had to do."

Overnight, more than 1,400 police swooped in to clear out the encampment. Police arrived in force and within minutes had encircled the park. Most protesters chose to leave on their own, but others remained behind.

Mayor Antonio Villaraigosa toured the park early Wednesday and praised Police Chief Charlie Beck and his officers.

"I said that here in L.A. we'd chart a different path, and we did," Villaraigosa said.

The mayor credited Beck's community-policing approach, noting that the chief and his officers had established a relationship with the Occupy protesters at the beginning of the encampment.

Another One Gone: Occupy Philadelphia Smashed by Cops

Another one gone: Occupy Philly camp joins list of cleared camps

November 30, 2011 | 6:54 am

To watch videos of the police actions against Occupy Philadelphia just click on the web site below:

Police dismantled the Occupy Philly encampment outside Philadelphia's City Hall early Wednesday, moving in shortly after midnight and driving out scores of people who had defied a Sunday evening deadline to take down their tents and leave.

About 50 people were arrested, most of them after scattering from the encampment and staging an impromptu march through downtown, the Philadelphia Inquirer reported. Three police officers reportedly suffered minor injuries, and some protesters were injured as well, none seriously.

Occupy Philly's dismantling came the same night that police in Los Angeles removed Occupy LA demonstrators from their own camp; both cities' actions were the latest in a nationwide series of similar raids that have taken place in the last month.

Mayors and police officials have cited safety concerns and noise issues as among the reasons for cracking down on the camps, which began springing up in mid-September and initially enjoyed mostly cordial relations with local political leaders.

In Philadelphia, Mayor Michael Nutter's patience with Occupy Philly began running out a couple of weeks ago after a man was arrested for a reported rape at the camp. Nutter also accused Occupy Philly in recent days of blocking a long-planned renovation project for Dilworth Plaza, where the protesters were camping -- a project he said would give jobs to the working-class people that Occupy Philly claimed to represent.

Nutter said that when the group first set up its tents Oct. 6, it had promised city officials that protesters would abide by local regulations and not stand in the way of the renovation.

The city tried to persuade the protesters to move to nearby Thomas Paine Plaza but mandated that even if they moved, they could not camp at the site and their demonstrations could only take place from 9 a.m. to 7 p.m. Occupy Philly rejected the proposal, setting the stage for a showdown.

The dismantling began about 1 a.m. and was preceded by three warnings from police that campers had to leave. That prompted some protesters to link arms and begin marching through downtown while chanting, "Get up, get down, there's revolution in this town," and "This is what a police state looks like."

Tensions peaked when marchers looped back to Dilworth Plaza, where they pushed through metal barricades erected by police trying to prevent them from reoccupying the site. Officers on bicycles and on horseback faced off with the protesters while workers dismantled the roughly 75 tents remaining and cleared the plaza of other personal items.

Police Commissioner Charles H. Ramsey said the raid was conducted overnight in hopes of preventing major disruptions. "We want to try to minimize any conflict. So it just made sense to do it early in the morning, when the businesses are closed," he said.

-- Tina Susman in New York

Washington Is Conquering Africa Using France, Human Rights, Terrorism and the NED

Washington is Conquering Africa using France, Human Rights, Terrorism, and the National Endowment for Democracy

Posted: 2011/11/25
From: Mathaba

Washington is Conquering Africa using France, Human Rights, Terrorism, and the National Endowment for Democracy

by Mahdi Darius Nazemroaya and Julien Teil

A repeat of the disorder and pandemonium generated inside Afghanistan is in the works for the continent of Africa. The United States, with the help of Britain, Pakistan, and Saudi Arabia, created the brutal Taliban and then eventually waged war on its Taliban allies. Similarly, across Africa, the United States and its allies are creating a new series of future enemies to fight, but after initially working with them or using them to sow the seeds of chaos in Africa.

Washington has literally been helping fund insurgencies and regime change projects in Africa. “Human rights” and “democratization” are also being used as a smokescreen for colonialism and war. So-called human rights and humanitarian organizations are now partners in this imperialist project against Africa.

France and Israel: Is Washington Outsourcing its Dirty Work in Africa?

Africa is just one international front for an expanding system of empire. The mechanisms of a real global system of empire are at work in this regard. Washington is acting through NATO and its allies in Africa. Each one of Washington’s allies and satellites has a specific role to play in the global system of empire.

Tel Aviv has played a very active role on the African continent. Israel was a major unapologetic supporter of South Africa under the racist apartheid system. Tel Avivalso helped smuggle arms into Sudan and East Africa to balkanize that sizeable African nation and destabilize its region.The Israelis have been very active in Kenya and Uganda, for example. The Israeli presence has also existed wherever blood diamonds and conflicts have been present in Africa. Israel is also now working with Washington to establish total hegemony over the African continent. It isactively involved through its business ties and intelligence operations in establishing the contacts and agreements that Washington needs for expansion in Africa and to disrupt the rise of Chinese influence.

France, as a former colonial master and a declining power, on the other hand has traditionally been a rival and competitor of Washington on the African continent. With the rise of the influence of non-traditional powers in Africa, such as the People’s Republic of China, both Washington and Paris began to look at ways of cooperating. On the broader global stage this is also evident. Both the U.S. and several of the major powers in the European Union considered China and other emerging global powers as great enough threats to end their rivalries and work together. Thus, a consensus leading to integration emerged, which was greatly boosted by the presidency of Nicolas Sarkozy in 2007.

President Sarkozy also wasted no time in pushing for reintegration of the French military command structure with NATO, which has subordinated the French military to the Pentagon. In 1966, President Charles de Gaulle pulled French forces out of NATO and removed France from the military command structure of NATO as a means of maintaining French independence. Nicolas Sarkozy has reversed all of this. In 2009, Sarkozy ordered that France rejoin the integrated military command structure of NATO. In 2010, he also signed an accord to start amalgamating the British and French militaries.

On the African continent, Paris has a special place or niche in the U.S. system of global empire– as a regional gendarme in North Africa, West Africa, Central Africa, and all the countries that were its former colonies. France’s special role, in other words, is due to history and the existing, albeit declining, position of France in Africa, specifically through the “Françafrique.” The Union of the Mediterranean, which Sarkozy officially launched, is one example of these French interests in North Africa.

The National Endowment for Democracy (NED) has also been working through France’s International Federation of Human Rights (Fédération internationale des ligues des droits de l’Homme, FIDH). The FIDH is much more established in Africa. The NED has essentially outsourced its work to manipulate and control African governments, movements, societies, and states to the FIDH. It was the FIDH and the affiliated Libyan League for Human Rights (LLHR) that helped orchestrate the grounds for the NATO war against Libya via the United Nations through unsubstantiated and false claims.

The NED and FIDH

Following the 2007 election of Nicolas Sarkozy as the leader of the French Republic, the International Federation for Human Rights (FIDH) started to develop a real partnership with the National Endowment for Democracy (NED). Both organizations are also partners within the World Movement for Democracy. Carl Gershman, the president of NED, even went to France in December 2009 to meet with the FIDH to deepen collaboration between the two organizations and to discuss Africa. [1] Most of the partnerships between the FIDH and the NED are based in Africa and the intersecting Arab World. These partnerships operate in a zone that covers countries like Côte d’Ivoire (Ivory Coast), Niger, and the Democratic Republic of Congo.North Africa, which includes Libya and Algeria, has been a specific area of focus for the FIDH, where Washington, Paris, and NATO clearly have major ambitions.

The FIDH, which is directly implicated in launching the war on Libya, has also received direct funding, in the form of grants, from the National Endowment for Democracy for its programs in Africa. A NED grant of $140, 186 (U.S.) has been the latest amount given to the FIDH for its work in Africa. [2] The NED was also one of the first signatories, along with the Libyan League for Human Rights (LLHR) and U.N. Watch, demanding international intervention against the Libyan Arab Jamahiriya. [3]

AFRICOM and the Post-9/11 Road Towards Conquering Africa

In 2002, the Pentagon started its first major operations aimed at controlling Africa militarily. This was in the form of the Pan-Sahel Initiative, which was launched by United States European Command (EUCOM) and United States Central Command (CENTCOM). Under the project, the U.S. military would trains troops from Mali, Chad, Mauritania, and Niger. The plans to establish the Pan-Sahel Initiative, however, date back to 2001, when the initiative for Africa was actually launched after the tragic events of September 11, 2001 (9/11). Washington was clearly planning military action in Africa, which already included at least three countries (Libya, Somalia, and Sudan) identified as targets by the Pentagon and the White House according to General Wesley Clark.

Jacques Chirac, the President of France at the time, tried to offer resistance to the U.S. push into Africa by reinvigorating Germany’s role in Africa as a means of supporting France. In 2007, the Franco-African summit even opened its doors to German participation for the first time. [4] Yet, Angela Merkel had different ideas about the direction and position that the Franco-German partnership should take in regards to Washington.

Since 2001, the momentum towards creating AFRICOM had started. AFRICOM was officially authorized in December 2006 and the decision to create it was announced several short months later in February 2007. It would be in 2007 that AFRICOM would actually be established. This momentum also received Israeli encouragement. The Institute for Advanced Strategic and Political Studies (IASPS), for example, was one of the Israeli organizations supporting the creation of AFRICOM.

On the basis of the Pan-Sahel Initiative, the Trans-Saharan Counterterrorism Initiative (TSCTI) was launched by the Pentagon in 2005 under the command of CENTCOM.Mali, Chad, Mauritania, and Niger were now joined by Algeria, Mauritania, Morocco, Senegal, Nigeria, and Tunisia in the ring of military cooperation with the Pentagon. The Trans-Saharan Counterterrorism Initiative would be transferred to the command of AFRICOM on October 1, 2008, which is when AFRICOM would be activated.

The Sahel and Sahara: The U.S.Clearly Adopts France’s Old Colonial Projects in Africa

Fighting terrorism and executing humanitarian missions are just façades or smokescreens. While the stated goals of the Pentagon are to fight terrorism in Africa, the real aims of Washington are to restructure Africa and to establish a neo-colonial order.

In this regard, Washington has actually adopted the old colonial projects of France in Africa. This includes the old U.S., British, Italian, and French initiative to divide Libya after 1943 and the unilateral French initiative to redraw North Africa.

The map used by Washington for combating terrorism under the Pan-Sahel Initiative says a lot. The range or area of activity for the terrorists,within the borders of Algeria, Libya, Niger, Chad, Mali, and Mauritania according to Washington’s designation, is very similar to the boundaries or borders of a colonial entity that France tried to create in Africa in 1957. Paris had planned to propup this African entity in the western central Saharaas a French department (province) directly tied to France, along with coastal Algeria.

This desired entitywas referred to as the Common Organization of the Saharan Regions (Organisation commune des regions sahariennes, OCRS). It comprised the inner boundaries of the Sahel and Saharan countries of Mali, Niger, Chad, and Algeria. The French goal was to collect and bind all the resource-rich areas into this one central entity for French control and extraction.

The resources in this area include oil, gas, and uranium. Yet, the resistance movements in Africa, and specifically the Algerian struggle for independence, dealt Paris a hard blow. France had to give up its quest and finally dissolve the OCRS in 1962, because of Algerian independence and the anti-colonial stance in Africa, which also cut France off from the inland area in the Sahara and created opposition towards France in Africa.

Washington clearly had this energy- and resource-rich area in mind when it drew out the areas of Africa that need to be cleansed of alleged terrorist cells and gangs. The French Institute of Foreign Relations (Institut français des relations internationals, IFRI) has even openly discussed this in March 2011. [5] It is also in this context that the amalgamation of Franco-German and Anglo-American interests is allowing France to become an integrated part of the U.S. system of global empire with shared interests.

Regime Change in Libya and the NED: A Nexus of Terrorism and Human Rights

Since 2001, the U.S. has falsely presented itself as a champion against terrorism. The Trans-Saharan Counterterrorism Initiative (TSCTI), which opened the doors for AFRICOM in Africa, was justified as necessary by Washington to fight organizations like the Salafist Group for Preaching and Combat (GSPC) in Algeria and the Libyan Islamic Fighting Group (LIFG) in Libya. Yet, Washington is cooperating and using these very same groups in Libya, along with the National Front for the Salvation of Libya and the Muslim Brotherhood, as foot soldiers and proxies in Libya and Africa. Moreover, many of the key Libyan individuals that are members of the National Endowment for Democracy (NED) are members of these groups and have also been part of conferences and longstanding plans pushing for regime change in Libya.

One of the key meetings for establishing what would become the current Transitional Council in Libya took place in 1994 when the Center for Strategic and International Studies (CSIS) organized a conference with Ashur Shamis and Aly (Ali) Abuzakuuk. The 1994 conference’s title was “Post-Qaddafi Libya: The Prospect and the Promise.” In 2005 another conference with Shamis Ashur would be held in the British capital of London that would build on the idea of regime change in Libya. [6]

Ashur Shamis is one of the founding members of the National Front for the Salvation of Libya, which was founded in 1981. He was also wanted by Interpol and the Libyan police. [7] Ahsur was also a director in the National Endowment for Democracy (NED) and in the Human and Political Development Forum (and the editor of the Akhbar webpage, which was registered under Akhbar Cultural Limited and was essentially a NED project). He has also participated in key conferences, including the one in London held by Chatham House in 2011, which discussed NATO plans for the invasion of Tripoli. [8]

Like Ashur, Aly Abuzaakouk is also a member of the National Front for the Salvation of Libya and tied to the National Endowment for Democracy. He was one of the key participants and attendees at the roundtable held for the 2011 Democracy Awards by NED. [9] Like Ashur, he is also wanted by Interpol and serves as a director at the Libyan Human and Political Development Forum. [10]

There is also Noman Benotman, a former leader and founder of the Libyan Islamic Fighting Group (LIFG) and a wanted terrorist. He conveniently left the Libyan Islamic Fighting Group due to the attacks of September 11, 2011 in the United States.

Benotman is not only a National Endowment for Democracy (NED) director in the Libyan Human and Political Development Forum, but he is also tied to the news network Al Jazeera.

Not only have these three men lived in Britain without any problems while they were wanted by Interpol and sought because of their ties to terrorism or, in the case of Benotman, drug-related crimes and forgery, but they also received grants from the United States. They received U.S. grants that formalized their NED organizations, which have been integral to the regime change agenda against the Libyan Arab Jamahiriya. This regime change agenda was done with the help of MI6 and the CIA.

The legal documents that have been filed for their NED organizations have been deliberately and illegally tampered with. One key individual’s identity has been hidden in the list of NED directors. Thus, legal documents have been fraudulently filled out to hide a certain individual’s identity under the alias of “Beata Wozniak.” Even Wozniak’s birthday is invalid, appearing as January 1, 1 (01/01/0001). She is listed as a director and secretary of Akbar, Transparency Libya Limited, and several British companies.

The Gate into Africa has been Opened

The fanning of terrorism in Africa is part of a deliberate strategy used by the U.S. and its allies, including NATO, for opening the door into the African continent by expanding the so-called “Global War on Terror.” This will give purpose to the U.S. objective of expanding its military presence in the African continent and it will also justify the creation of the Pentagon’s AFRICOM, which is meant to manage Africa by creating an African version of NATO as a means for establishing Washington’s control. In this regard, the U.S. and its allies have already put budgets aside to fight the very terrorist organizations that they have cooperated with, encouraged, nurtured, armed, and proliferated across the map of Africa from Somalia, Sudan, Libya, and Mali to Mauritania, Niger, Algeria, and Nigeria.

The terrorists not only fight for Washington on the ground, but they also interact with Washington through so-called human rights organizations that promote democracy. These individuals not only destabilize their countries, but they also actively work for regime change and military intervention. Libya is a clear case of this.


[1] National Endowment for Democracy, “NED Strengths Democracy Ties with France,” March 16, 2010:

[2] National Endowment for Democracy, “Africa Regional,” August 2011:

[3] United Nations Watch et al., “Urgent Appeal to Stop Atrocities in Libya: Sent by 70 NGOs to the US, EU, and UN,” February 21, 2011:

[4] Ministry of European and Foreign Affairs (France), “XXIVème sommet Afrique-France,” February 2007:

[5] Etienne de Durand, “Francs-tireurs et Centurions. Les ambiguïtés de l’héritage contre-insurrectionnel français,” Institut français des relations internationals, March 2011:
[6] The National Conference of the Libyan Opposition, “The National Accord: The National Conference of the Libyan Opposition, London, 26th June 2005,” 2005.

[7] Interpol Wanted Notice for Ashour Al-Shamis :

[8] Foreign and Commonwealth Office (U.K.), “Chatam House event: the future of Libya,” June 2011:

[9] National Democracy for Democracy, “2011 Democracy Award Biographies,” June 2011:

[10] Interpol Wanted Notice for Aly Abu Zaakouk:

The Troubling Case of Saif al-Islam Gaddafi

Weekend Edition November 25-27, 2011

ICC Prosecutor’s Career Move Switches Horses and Legal Theories in Libya

The Troubling Case of Saif Gadhafi

A CounterPunch Exclusive
Zintan, Libya

Despite the claims of the National Transitional Council of Libya (NTC) that Saif al Islam Gadhafi, the apprehended subject of an International Criminal Court arrest warrant that ordered his transport to The Hague, is in a secure hidden location near Zintan, Libya, a town approximately 85 miles southwest of Tripoli, this is not the case.

Neither are the assurances by Steven Anderson, spokesman for the International Committee of the Red Cross (ICRC) who on 11/23/11 announced that Saif al-Islam’s injuries had been “taken care of,” nor his profuse assurances that Saif is in good health. In point of fact, following the ICRC assurances, the Ukrainian-born Doctor Andrei Murakhovsky who lives in Zintan reported that “Saif’s wound is covered with gangrenous tissue and necrotic tissue.” He added that “This wound is not in good condition and requires amputation. His index finger has been ripped off at the level of the middle phalange (finger bone), the bones are all shattered. It’s the same thing with the thumb of that hand.” Dr. Murakhovsky told the Reuters news service.

The morning of 11/24/11, Libyan NTC Prime Minister Abdurrahim El-Keib still insisted that “Saif al-Islam is receiving the best possible treatment, but for now he is not in the hands of the provisional central government and we don’t know where he is.”

Regarding Saif al Islam’s “secure and hidden location”, most people in the village of Zintan know where he is being held, as does this observer who visited a motley group of B-western movie types who are currently guarding and “protecting” Saif.

Although armed with a Power of Attorney from one of Saif’s family members to visit him, the group refused my request to visit Saif with the excuse that they had to consult their commander who was not expected to return for a few days since he was now the new NTC Libyan Defense Minister.

On the question of Saif’s health, there is increasing concern also because his guards claim they cannot take him to Zintan’s only hospital because someone would likely kill him in order to collect on the substantial rumored Qatar/NATO offered cash reward for whoever assassinates him thus presumably helping “the new Libya” and its allies avoid a messy trial.

Meanwhile, after what he claims in a change of heart, the International Criminal Court (ICC) Prosecutor, Luis Moreno-Ocampo, now professes that Libya, not The Hague, is the best place after all for Saif al Islam and his trial. Since its establishment by the United Nations in 2002, the ICC has had just one Prosecutor, Luis Moreno-Ocampo. To the reported expressed relief of many international defense lawyers, several ICC staff and ICC judges, plus legal commentators familiar with his prosecutorial work, the ICC will have his successor chosen next month in New York. This coming weekend in New York, the legal defense organization, Avocats Sans Frontiers (ASF, ie Lawyers Without Borders) will meet in order to try to agree on a successor to propose to the 18 ICC Judges who will decide.

Prosecutor Ocampo’s visit this week to Libya caused some raised eyebrows among the groups noted above when he suddenly announced that the ICC would not invoke its UN Security Council-granted power and proceed with Case # ICC 01/11. This case was opened at the ICC on March 3, 2011, having been assigned to the ICC by the UN Security Council following the preceding month’s uprising in Benghazi, Libya.

Speculation among some in The Hague, in Libya and from ASF lawyers is that knowing that he would not be re-elected for another term as ICC Prosecutor, due to among other reasons he has not won one case during his 9 year term, has repeatedly incurred the wrath of ICC judges for bringing cases which they ruled lacked sufficient evidence and his penchant for self-aggrandizing publicity and making inaccurate claims about cases and defendants that border on judicial misconduct, Ocampo decided to switch horses.

One egregious example of his making false representations is the current ICC case involving Saif al-Islam Gadhafi in which Ocampo made several inaccurate headline-grabbing statements over the past several weeks claiming to be negotiating “indirectly” with Saif al Islam to give himself up to the ICC. Saif has emphatically denied Ocampo’s grandstanding claims and presumably, were Ocampo to attempt to personally prosecute his case Saif’s legal team would immediately file a motion to replace Ocampo for cause, as provided by ICC rules.

Given these problems, Ocampo, according to someone who accompanied him during his visit this week to Libya, decided to accept a lucrative offer from the NTC to advise the oil-rich country on setting up a legal system to try Saif al Islam and others.

The assurances by Moreno-Ocampo, NATO officials and American UN Ambassador Susan Rice that Libya is currently fully capable of currently handling trials of former regime loyalists are nonsense. Rice exhibited ignorance and surprise here last weekend when she claimed not to know that Libya had the death penalty and would apply the death penalty in the ICC case if given the chance. The Libyan public’s apparent preference is for the death penalty by hanging in the two Libya ICC cases. This was the case with Rwanda, which is one reason the Ruanda Tribunal did not allow the government of Rwanda to conduct certain trials even though that government assured the UN it would not actually carry out a death penalty sentence. Libya has offered no such assurances to the ICC against the use of the death penalty nor has it submitted a legal challenge to ICC jurisdiction over the Saif al Islam or Abdullah Sanussi cases, as the Rome Statute requires.

Despite switching jobs, Ocampo has not lost interest in prosecuting the Saif al Islam case which he views as his best chance of finally winning at least an ICC related case, but not at The Hague where there is the possibility that Saif could be convicted, given Court rules of procedure and ICC legal staff resources that would actually assist an accused in presenting his defense before the court. Ocampo is said to be betting on gaining a victory in Saif’s high profile case by working with the NATO-created NTC government in Libya and running the prosecution as a behind the scenes “consultant” and helping Libya’s NTC keep the UN and ICC at bay while allowing the NTC to try both Saif’s case and that of Abdullah Sanussi if and when the latter is proven to have been captured. Ocampo is said to relish the job of becoming the “Father of Libya’s new legal system.” Ocampo is now explaining that it was never his role “to tell Libyan officials how to hold a fair trial and the standard of the ICC is that it has to be a judicial process that is not organized to shield the suspect and I respect that it’s important for the cases to be tried in Libya.” He then added, “There are so many different traditions, it is difficult to say what is fair.”

No sooner had the surprising news and Ocampo’s sudden vagueness about what constitutes a fair trial begun to ricochet around the Internet than this observer received an email from an international criminal lawyer whose office is two blocks from the Carl Moultrie Courthouse in Washington, DC. The American lawyer was appalled: “Paying Ocampo as a consultant for the new Libyan government on criminal trial procedures is a ridiculous thought/idea. He has no idea of fair trial rights and has not achieved a conviction in his nearly 9 years at the ICC.”

Nor were the ICC judges thrilled at the perceived betrayal. The ICC quickly fired off a reminder to Ocampo, to the new Libyan government and the media that it is the ICC judges, and not the ICC Prosecutor, who will decide whether a case will be held in The Hague or if the country where the alleged crimes occurred and only they will decide if Libya has the ability to conduct a fair trial. The ICC is signaling that the Ocampo-generated international headlines to the contrary notwithstanding, the issue of trial venue in Libya has not settled in ICC case # 01/11.

Prosecutor Ocampo knows well that once the ICC decides to open an investigation of a case, national courts may not investigate that case and are relieved from their obligation to do so. In addition, since the ICC has issued an arrest warrant against Libyan defendants, all states – including Libya – are obliged to cooperate fully with the Court.

Following the public dressing down from The Hague, Ocampo has now retreated a bit and told CNN on 11/23/11 that: “ The only condition is the new Libyan government has to present their position to the International Criminal Court judges and the judges will decide if the case can be prosecuted in Libya. Libya will present evidence to ICC judges that the country can hold the trial, and the judges will decide if they are satisfied,” Ocampo explained.

The ICC, if it takes up the question as expected, should rule in the developing Saif al Islam case, precisely as the International Criminal Tribunal for Rwanda found in ruling against that country’s request for trial jurisdiction, although like Libya today, Rwanda claimed to have “modern functioning court system.” The reason is that an initial review of Libya’s criminal judicial system and discussion with Libyan criminal defense lawyers as well as with international criminal defense lawyers with years of experience in international tribunals’ practice, shows that it is very clear that persons accused of serious crimes in Libya currently do not have even the most minimal judicial rights that are required by international norms. Today Libya defendants do not enjoy adequate legal representation, financial support for indigent accused, travel and investigation support for defense teams, security for defense teams. Libya’s central and local governments place impediments curtailing defense teams in the discharge of their functions.

An admittedly cursory inquiry in Libya among lawyers here also reveal nonexistent or inadequate accommodation and transport arrangements for witness, as well as a lack of arrangements for protection of witnesses before, during and after testifying in court. In addition, the NTC is engaging in a pattern of threatening potential witnesses preparing to testify against NATO in another case. Similarly the NTC is failing to provide safe and secure travel for Libyan witnesses living abroad, including in Algeria, Tunisia, Mali, Niger, and Egypt. Interviews with Libyan lawyers and officials as well as visits to detention facilities in Libya reveal that conditions are not in compliance with international standards and that there is widespread torture of prisoners in Libya and threats against the families of prisoners.

Franklin Lamb is reachable c/o