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Belmont Club

Reading The Small Print

December 19th, 2014 - 3:09 pm

Mark Lander of the New York Times describes how president Obama has ‘mastered the art of secret negotiations’. “What the Cuba, Iran and China talks have in common — aside from their cloak-and-dagger allure — are a small team of negotiators, strict discipline and tight control by the White House.” A less charitable description might use the words “deceit”, “amateurism” and “bad faith” to characterize the White House’s efforts.

They also attest to Mr. Obama’s willingness to entrust historic projects to close aides, some of whom are young and have little experience in diplomacy.

In the case of Cuba, the entire American delegation consisted of two White House officials, one of whom, Benjamin J. Rhodes, is a 37-year-old speechwriter who has worked for Mr. Obama since his 2008 campaign and has become an influential voice in the administration. The Iran and China negotiations were also led by trusted Obama aides.

Using non-diplomats helps preserve the veil of secrecy, a senior official said, because such people are less likely to arouse suspicion among colleagues or the press. The three countries with which they were negotiating, the official said, were also able to keep a secret.

Castro seems to be the big winner.  The WSJ says that the White House may be intentionally giving away the store as part of a deep game. “By offering so much for relatively little, Mr. Obama may calculate that an American gesture now will lead to a larger opening once the aging Castro brothers finally go to their eternal punishment.”

He may also hope that by acting now he can prepare the way for a triumphant visit to Havana before the end of his Presidency. Mr. Obama came to office in 2009 promising a new era of engagement with U.S. adversaries, and engage he has. Perhaps his Cuban “reset” will turn out better than have his efforts with Russia, Syria, North Korea and Iran.

The administration has a talent for turning victory into defeat. It’s good news for Fidel Castro, just when his regime was teetering on the precipice occasioned by the bankruptcy of principal allies Venezuela and Russia. The president has argued that 50 years of isolation has not toppled Castro. Why topple him now that he’s on the verge of going over the cliff? Maybe because the administration wants a stable Communist dictatorship off Florida in preference to a nation ripped apart by civil war.  If starving Cubans actually stage a real revolution in Havana it might be inconvenient.

Mark Trumbull of the Christian Science Monitor asks “will closer financial ties between the United States and Cuba help to promote political reform on the communist island or simply prop up a morally bankrupt regime?”

“The United States has just thrown the Cuban regime an economic lifeline,” Sen. Robert Menendez (D) of New Jersey, outgoing chairman of the Senate Foreign Relations Committee, said in a statement released Wednesday. Another senator of Cuban-American heritage, Ted Cruz (R) of Texas, used the same “economic lifeline” phrase in issuing his own lament.

But one of the benefits to secret negotiations is that the administration can completely avoid answering such knotty questions. Julie Hirschfeld Davis and Michael Gordon of the New York Times report “Obama Intends to Lift Several Restrictions Against Cuba on His Own”.  He’ll do it all in his vest pocket, in the same secretive manner that he conducted the negotiations themselves.


Let’s Get Ready to Rrrrubble!

December 17th, 2014 - 4:16 pm

Russian consumers flocked to stores to buy what they could before the value of their money dropped further. The ruble is crashing. The Associated Press says that “Russian authorities announced a series of measures to ease the pressure on the ruble, which slid 15 percent in the previous two days and raised fears of a bank run, many Russians were buying cars and home appliances — in some cases in record numbers — before prices for these imported goods shoot higher.”

Apple has stopped online sales. Ikea stores have been overrun with frenzied buyers. A run on banks could be just a few days away. The big time guys are panicked too. The Daily Mail says Russian oligarchs are converting away from the ruble like it was going out of style. “‘I’ve got £100m to spend, what can I get in Mayfair?’ … Russia’s oligarchs have started a new stampede for high-end London property to protect their wealth from country’s collapsing economy”

Walter Russell Mead, writing in the American Interest says that with Putin’s back  up against the wall he may be as dangerous as the proverbial wounded bear.

Will Putin surrender to the West or double down, Mead asks?  If he doubles down, Mead suggests two ways  Putin can run. First, he could pawn the country to Beijing.  China would bail him out — for a price.  Second, Putin could attempt to boost the price of oil by stirring up trouble in the Middle East.

For the Democratic party it’s like finding a pot of foreign policy gold in its backyard that they don’t know what to do with. The Washington Post reports that “New York Gov. Andrew Cuomo’s (D) administration said Wednesday that it will block gas development by hydraulic fracturing, bringing to an end a six-year study process and kicking off what could be years of lawsuits from developers who want to tap rich Marcellus shale deposits.”

Too late Andrew. America became the world’s biggest producer of oil in July, 2014, overtaking Saudi Arabia and Russia according to Bloomberg. “Oil extraction is soaring at shale formations in Texas and North Dakota as companies split rocks using high-pressure liquid, a process known as hydraulic fracturing, or fracking.” Not even the New York Democratic party can stop them now.


Upstairs, Downstairs

December 16th, 2014 - 1:14 pm

There are certain places where you go to surf; Hawaii for instance. But there are places one goes for other reasons.  Eli Lake writes that the Senate report message implies that Pakistan is the place to go when you need someone rubber hosed.  Surfing, Hawaii. Torture, Pakistan.

The report, written by the majority staff of the Senate Intelligence Committee, cites six instances in which Pakistani authorities, in particular, obtained leads through interrogating al-Qaeda operatives that helped disrupt plots or locate other terrorist leaders. The Pakistanis often got first crack at detainees before they were sent to CIA prisons.

Take the example of Ammar al-Baluchi. In the movie “Zero Dark Thirty,” the torture of al-Baluchi is depicted as revealing the key piece of intelligence identifying Osama bin Laden’s courier, Abu Ahmed al-Kuwaiti. In 2011, the CIA was able to find and kill bin Laden because it had tracked the movements of al-Kuwaiti.

The CIA’s rebuttal to the Senate report says al-Baluchi gave up much more specific information on al-Kuwaiti after he went through the agency’s harsh interrogations. The Senate report, however, says al-Baluchi gave up al-Kuwaiti first to the Pakistanis.

One can think of that Southwest Asian country as the coercive interrogation equivalent of Alang, India — the shipbreaking capital of the world. Alang is where Europe sends ships that are too polluted or use too much asbestos to be handled under Union Rules. Instead they are dismantled by swarms of half-naked, unprotected Indian workers glad for the work.  Analogously, Pakistan is one of the countries all too willing to undertake jobs too dirty for more fastidious political climes.

Lake continues: “A former senior Pakistani diplomat who spoke to me on condition of anonymity said it’s likely that al-Baluchi and other detainees mentioned in the report were tortured; threatened with torture; or told that their family members would be in danger if they did not cooperate.” Does anyone care? Not anyone who counts at least.  And even if it happened, the Pakistanis did it; we didn’t. Our hands are clean. Plausible deniability is a very useful commodity.

However in exchange for the advantages of living outside Western standards Pakistan must endure the rigors of living under local ones.  Just a few hours ago the Taliban attacked a school for the children of military personnel in Peshawar, killing more than 130; shooting or beheading the kids wholesale when they weren’t burning the teachers alive in front of their pupils.  The assailants shouted “Allah Akbar”.  Allah Akbar Avenue is a two way street.

A Taliban spokesman said the Peshawar massacre was  ”just the trailer“, implying that the ‘next attraction’ was in the works; and that it was ‘coming soon’.  It will presently be ‘now showing’ at a location near you. NBC news claims the attack is in revenge for Pakistani operation against the Taliban in North Waziristan.


Making Bail

December 15th, 2014 - 4:04 pm

The main question I would have had for Sydney siege perpetrator Man Haron Monis could I but reach him by ouija board was where he got the money to make bail and hire his lawyers.   He was up on 40 sexual sexual assault charges.   Fifty, if you believe the Washington Post.

That’s not counting charges of using the mail to commit crimes.

Monis used Australia Post to send offensive or in one instance, harassing, letters to relatives of Australian Defence Force members killed in combat in Afghanistan. Another letter was sent to relatives of an Austrade official who had been killed in the bombing of the Marriot Hotel in Jakarta in 2009. Droudis assisted Monis to send the letters.
Monis was charged with 12 counts of using a postal service in a way that reasonable persons would regard as being, in all the circumstances, offensive pursuant to section 471.12 of the Criminal Code and 1 count of using a postal service in a way that reasonable persons would regard as being, in all the circumstances, harassing pursuant to section 471.12 of the Criminal Code.

The mail rap was described by Altmedia under the heading Australians assault Islamic protester, which makes him out to be the victim of a lynch mob.

One man emerged from the crowd and punched him in the head; another in a passing car threw coffee all over him; angry words flew from passersby.

Yet the controversial Sheikh Haron stood his ground for three days outside the Downing Centre Courts, his white turban, tan robes and full beard shouting ‘Islam’ at the milling crowds. Heavy chains with padlocks draped over his body spoke of oppression and imprisonment. His coffee-stained sign read “Australians don’t want war”, a belief perhaps contradicted by the naked aggression directed at the lone protester.

This is the man, under the name of Man Haron Monis, now facing seven charges arising from letters he allegedly sent to the families of soldiers killed in Afghanistan. Media reports claim the letters blamed the soldiers for the killing of innocent women and children. The Jewish News reported: “Felix Sher, the father of a Jewish soldier who was killed on duty in Afghanistan earlier this year, has received a hateful phone call and a number of letters calling his son a “pig” and a “murderer”.

The Australian and The Daily Telegraph both quote another line, allegedly from one of the letters: “I feel bad that you have lost your son but I don’t feel bad that a murderer of innocent civilians has lost his life.”

Sheikh Haron denies this interpretation: “The word ‘pig’ and other words that media have claimed are from completely different sentences, they have cut them and the incomplete quotes have been taken out of context.”

And then there’s Sheik’s beef as accessory to murder. “Man Haron Monis was on bail on a charge of colluding with his girlfriend to murder his ex-wife, who was stabbed 18 times and set alight outside a western Sydney unit in April last year.” There’s a US connection to this last crime, incidentally. The torched ex-wife’s brother lives in California, who on hearing of the Sheik’s demise said “rest in hell f****n asshole”. Tut, tut. What bad language.


The Sydney Cafe Siege

December 14th, 2014 - 5:43 pm

Nothing ever happens in Sydney, Australia.  If you Google “Sydney” and “siege” you will come up with Sydney Street Siege, which took place between anarchists and the British security forces headed by then Home Secretary Winston Churchill in 1911.  But that may change.

Something has finally happened in Sydney.  This is a theme which is now frequently being echoed on the radio: Australia was subliminally regarded, even by its inhabitants, as the last place on earth where anything bad could take place.  But that situation had been changing for some time.  By some accounts 200 Australian passport holders have traveled to Syria and similar places to learn the Jihadi trade. “The Australian Security Intelligence Organisation (ASIO) reported at the end of the year: ‘The situation in Syria, with the potential for violence spilling into other parts of the Middle East, increases the possibility of associated communal violence in Australia and remains a concern for ASIO’.”

As most readers may know by now, a gunman or gunmen has taken about a dozen hostages (up to 40 but accounts differ) prisoner in a cafe in Martin Place, which is the ceremonial heart of Sydney.  It’s near the Cenotaph war memorial and but a stone’s throw from the US consulate.  US citizens in the country have been warned to be aware of their surroundings, in the sense of being on guard against possible threats.

The scene of the incident is an upscale cafe, which now has a black “shahada” flag draped across it, saying “there is no God but Allah”.  There are reports that the police have rounded up a number of one of the suspect’s associates in Auburn, which is a suburb heavily populated by Muslims.

The situation has settled into a siege.  Prime Minister Tony Abbott has made an essentially content-free statement on the situation,  saying his thoughts are with the hostages and the cops are working on resolving the situation. However, he added nothing of substance to the open source facts.

But that hasn’t stopped the debate over hot-button issues like immigration and multiculturalism from pre-emptively starting up. One person on Twitter says:

WARNING: troll accounts of racists/fascists springing up to exploit #MartinPlaceSeige incidents. Block, report, delete. Human scum. #antifa


The Statue of Limitations

December 14th, 2014 - 3:20 pm

Recently senior Sony executives shown to have made certain disparaging remarks in private emails about celebrities and president Obama are said to be resigning. Ever since emails hacked by the North Koreans were made public, their private behavior is being held to a politically correct standard. The irony is that one of the executives was a well-known Obama supporter.

Recently, Cornell Law professor William Jacobson argued that even if you are guilty of nothing illegal, PC can still find you guilty of something. Speaking on the Steve Malzberg show, Jacobson maintained the spate of accusations about college rape is not aimed at prosecuting anyone but ‘bringing down the patriarchy’; about expanding the space of political correctness.  Never mind if something was said  in whispered confidence or  jest, it may later be recalled to one’s immense disadvantage.

Recently the European Union demanded the establishment of the Right to be Forgotten. “The issue has arisen from the desires of some individuals to ‘determine the development of his life in an autonomous way, without being perpetually or periodically stigmatized as a consequence of a specific action performed in the past’”.  Perhaps alongside it there will soon be another — the Right to be a Hypocrite.

Wikipedia defines hypocrisy as “the claim or pretense of holding beliefs, feelings, standards, qualities, opinions, behaviors, virtues, motivations, or other characteristics that one does not in actual fact hold. It is the practice of engaging in the same behavior or activity for which one criticizes another.”

But the same article points out that hypocrisy can be useful.  ”Various studies have shown that there can be benefits from inducing hypocrisy. A 2004 report stated that smoking amongst college students decreases when hypocrisy was induced.  Furthermore, another study has stated that condom use increases amongst college students when hypocrisy is induced.”

Not only that, it helps people ‘get along’, for we often prefer the fake person to the real.  Hypocrisy is what makes PC bearable. It is a mask that keeps our facial muscles from sagging from fatigue.

The entire movement against Hate Speech is from one point of view a campaign to institutionalize organized hypocrisy, for it is tremendously useful, the axle grease of modern society. There is now a movement in Europe asserting the “right not to be offended” the better for us to get along.  Back in 2006, a labor union moved to dismiss a bus driver from his position after it became known he had joined the British National Party, which led to a long lawsuit.  After all, people had the right not to be subjected to the presence of a right-wing bus driver.


Kling’s List

December 13th, 2014 - 9:43 pm

Arnold Kling‘s Not What They Had in Mind is a short book which lays out why he thinks the financial meltdown of 2008 happened. It costs 87 cents on Amazon Kindle and is an easy read, as economics books go.

His basic theory is that each generation of regulators creates an unintentional policy bomb from the ruins of the most recent crisis. They prepare to fight the last economic disaster and prepare the ground for the next one. One of his key graphs is a timeline of regulatory regimes starting from the 1934 National Housing Act until the 2004 Housing Interim Goals set for 2005-2008. The regs as they stood in 2008 were just the thing to prevent the disasters of the previous decades, but unfortunately that was not the crisis they faced.

He uses the regulatory map to explain how the finance industry and government had cooked up between them a way of doing business founded on loopholes. Constrained by the regulations, every player found ways to satis-fice their positions while staying within the letter of the law. They even created off-balance sheet risks that were altogether invisible.

And what you can’t see can’t hurt you. Or so the saying goes. But in reality the entire industry was sitting on huge pressure dome of largely unrecognized risk.

Neither the regulators nor the industry were really dishonest. Not really, or perhaps better said, not technically. Each sincerely believed there was no real harm done.  But they assumed a stable situation,  in the sense that huge herd of cattle is stable. Nobody could really envision how radically things could change when a landscape of placid cows suddenly turned into a maddened sea of thundering hooves.

The seeds for much of the current crisis were sown in the policy ‘solutions’ to previous financial and economic crises. … What made the crisis possible were the illusions that key participants held …

Financial executives had excessive faith in mathematical models of risk, in financial engineering, and in the “AAA” designation of the credit risk agencies … regulators themselves encouraged reliance on agency ratings …

the regulatory community shared the illusions of the key market participants. Regulators, too, placed too much confidence in financial engineering … thought that the dispersal of risk into the ‘shadow banking system’ made the core financial system safer … that securitization was the superior form of mortgage finance.

While the housing market provided the explosive for the implosion, what weaponized it was the the structure of the industry; the build-up of risk without a corresponding reserve of real capital to meet contingencies.  The rest, as we know, is history.  Once the avalanche started assets valued on an obsolete perception became debased and fed back into the cycle of worthlessness.

Kling’s book should make fascinating reading not just for economists but also for students of war and international security. His dissection of the financial crisis contains the generic components of any crisis. Kling’s anatomy of the meltdown consisted of these four things.

1. bad bets;
2. excessive leverage;
3. domino effects; and
4. 21st century bank runs.


The Second Wave

December 12th, 2014 - 4:01 pm

When my mother’s computer refused to boot last week, she called me right away.  ”You have to do something,” she said.  ”My computer’s dead. How can I Skype? Pay my bills?  Send emails?”  It had been, she said, 48 hours.  How much longer could it go on?  We went down to the store and picked up a Microsoft Surface tablet and I spent four hours customizing and walking her through it with the result that she now calls me by Skype on my phone.

No one is too old any more to have a technological problem. An old gentleman pushing a big shopping cart at the supermarket had a senior moment when it came time to enter his pin into the card reading device. “I’ve forgotten my password,” he said.  ”Why don’t you serve this gentleman,” he said pointing to me and stepping aside, “while I recollect it.”

He went off a few steps and started at the ceiling.  As I was leaving, I glimpsed him returning with a wide smile to the cashier.  Evidently he had remembered what it was.  By such threads does ordinary life hang in the balance. All the banks admonish their customers never to keep their PINs in their wallets for security reasons.  But in peaceful Australia the main threat is forgetting your PIN just when you need the money. I thought: maybe a wife can write a husband’s pin down in her wallet and vice versa, so when they forget they can call each other, but if even the wallet is lost the pin kept in the wallet refers to the wrong card. Do you even remember how many PINs you have?  Maybe you should emulate me and store them in an offline device protected by a password.  Now can I remember that password?  Let see now …

But it’s the cashiers who are an endangered species.  Not long ago there was  one self-service checkout to 11 manned lanes.  Now it’s edging toward parity.  Soon the cashier will go the way of the slide rule and the teller. Remember the teller?  The last few tellers at the bank are there to accept checks.  Remember checks?

The last vestiges of physical money are fading away in the Western world.  By contrast ISIS, still hand delivers messages (the better to evade the NSA) and issues metal coinage.  ”In its bid to win recognition as a sovereign political entity, Islamic State (IS) has announced its intention of minting its own coins, to be used independently of the international financial system in territory under its control.”

The projected currency is to consist entirely of coins. According to the radical Salafist doctrine of IS, paper currency is responsible for inflation, depression, and other economic crises. The doctrine also rejects bond trading, usury, and money changing. The coins—made of gold, silver, and copper—are seen as having intrinsic value, providing confidence that they will not lose value if there is a drop in exchange rates.


For We Know Not What We Do

December 10th, 2014 - 1:55 pm

I’d like to apologize to readers for failing to realize that a link in the previous article was to a satire piece. It’s getting harder to spot them, but just as an aging man has to try to walk each day or never walk again, the effort must be made, even though you’ll lose in the end. I’ll try harder next time.

While we’re on the subject of knowledge gaps, Micah Zenko of the Council of Foreign Relations notes that the CIA never measured the effectiveness of their covert programs.  Take interrogation. A memorandum by the CIA dated June 27, 2013 — but only released today — responds to “the SSCI’s conclusion that the ‘CIA never conducted its own comprehensive analysis of the effectiveness of the CIA’s enhanced interrogation techniques’”. (emphasis mine)

We agree with Conclusion 10 in full. It underpins the most important lesson that we have drawn from The Study: CIA needs to develop the structure, expertise, and methodologies required to more objectively and systematically evaluate the effectiveness of our covert actions.

We draw this lesson going forward fully aware of how difficult it can be to measure the impact of a particular action or set of actions on an outcome in a real-world setting.

Zenko concludes that “therefore, the CIA admitted that — as late as June 2013 — it was simply incapable of evaluating the effectiveness of its covert activities.”  They just kept doing the same old covert things without knowing how well, or even if they were accomplishing their goals. Zenko’s main point comes next:

this also directly implies that the CIA lacks the ability to adequately evaluate its much larger, more lethal, and more consequential covert program: its role as the lead executive agency for drone strikes in Pakistan, and many of those in Yemen. … Based upon the best publicly available information, the CIA has killed an estimated 3,500 people in non-battlefield drone strikes since the program began on November 3, 2002 …

I have spoken with former and current National Counterterrorism Center (NCTC) officials and analysts, who have always been uneasy with having CIA analysts evaluate CIA covert programs.

Specifically, they claim that — compared to the NCTC’s own analysis—CIA analysts are more likely to discount claims of collateral damage and the thesis that drone strikes creates blowback in the form of enhancing terrorist recruitment. …

If the 119 detainees who entered the rendition and interrogation program — 26 of whom were wrongly detained — deserve a public accounting, then don’t the 3,500 who have been killed deserve this as well? Or, is the United States simply more comfortable with torturing suspected terrorists than killing thirty times more of them?


Crazy Talk

December 9th, 2014 - 1:23 pm

There’s a saying that the surest way to go crazy is to keep the company of the insane.  Glenn Reynolds links to an account of a male gender studies  graduate telling every stranger he could find at a party to admit their “privilege”.   The man who may or may not have been invited, “moved throughout the party, unleashing the fundamental concepts of his undergraduate major at every opportunity. ‘It was kind of weird to get lectured about the patriarchy by, y’know, a member of the patriarchy,’ one victim commented. ‘He called me an Uncle Tom for wearing bras.’”

“Privilege” is the word du jour. Have you checked your privilege lately?

Recently there were two dueling articles in the Israeli press. The first, wrote Benjy Cannon of J Street,  argued that Jewishness could not excuse the crime of  ”whiteness”. “While I do not often think, write about, or actively engage with my whiteness, it is an omnipresent force in my life”.  This was challenged by Hila Hershkovitz in the Times of Israel, who asserts “Ashkenazi Jews are not white” or at least there was a time when real white people, guys with names like Himmler, didn’t think so.

She has a point.  Things are no longer what they seem.  Ward Churchill is Native American, as is Elizabeth Warren.  Nikki Haley is definitely not white, even though she’s checked the box.  And the whitest man in America, though he may not look it, is George Zimmerman.

A name is not a name either.  Lena Dunham  has responded to a threatened libel suit by admitting that the Republican called Barry who she says raped her in college wasn’t really called Barry. Random House is adding disclaimers warning readers not to take this book of nonfiction too literally.  Interestingly digital copies of Dunham’s autobiography are going to be redacted to fit Dunham’s new storyline.  So if you are reading a book hosted on the cloud and find the letters rearranging themselves before your very eyes, don’t worry, it’s not you that is going nuts, but the world.