NCLG Blog

Iraqis are too shrewd to fall for an ‘invisible’ occupation

2009-07-02T03:36:00.000-07:00

By Priya Satia

Published: July 1 2009 20:03 | Last updated: July 1 2009 20:03

We are at the beginning of the end. On Tuesday, US troops left Iraq’s cities, and in two years they will leave the country. Or so the official story goes. In reality, most of the “withdrawing” forces are merely relocating to forward operating bases where they appear to be hunkering down for a long entr’acte offstage in expensive, built-to-last facilities.

Still, Nouri al-Maliki, the prime minister, is touting this redistribution of American power as a “great victory” against foreign occupation, akin to the Iraqi rebellion against the British in 1920. The US media appear bemused at the comparison, as they continue to miss the point of the Iraqi insurgency. But Mr al-Maliki is more right than he knows about the historical echo: 1920 turned out to be a sad year for Iraq, as the brutal British suppression of that uprising inaugurated four decades of British rule, lasting until the 1958 Iraqi revolution.

Today, too, victory is tinged with fraud. And the Fallujah bombers – the “patriotic resistance” – know it. Mr al-Maliki may claim US participation in maintaining public order is “finished”, but everyone knows public order depends on Iraqi awareness of the offstage presence of US troops.

US operations will be suspended for a few days to promote the perception that Iraqi forces are actually in control; Ali al-Adeeb, a senior leader of Mr al-Maliki’s Dawa party, says the Americans will become “invisible”.

But Iraqis are too shrewd to fall for invisible occupation again; indeed, they never fell for it the first time. Tuesday’s withdrawals echo the cynical British grant of “independence” in 1932 more than Mr al-Maliki’s selective memory of 1920. Then, too, the foreign occupiers co-operated in the local government’s efforts to create an impression of sovereignty, while continuing to pull the strings of real authority behind the scenes. Then, too, Iraqis saw through the ruse. The celebrations of 1932 rang hollow as British aircraft continued to patrol overhead and British personnel were renamed advisors, trainers, liaisons – “the same individuals with new and supposedly thicker cloaks”, one British official confessed. Today, too, the thousands of troops that will remain in Iraq will be restyled as “trainers” and “advisers”; American aircraft will retain their free hand. Moreover, the Iraqi and US governments’ focus on appearances has increased their need for secrecy about the true number and nature of the withdrawals, compounding suspicions of foul play.

Iraqis worry equally about the loyalty of Iraqi security forces, who will remain under the sway of thousands of embedded US “trainers”. Their takeover of the violent security work of the former occupiers also renders them suspect.

In sermons last week, Moqtada al-Sadr, the firebrand cleric, warned of American loyalists in the military and government. Echoing 1920s and 1930s speculation that violence was the result of British machinations, he blames recent explosions on an American conspiracy to justify the US presence. His sermons inspired marches in Sadr City with shouts of, “No, no to America. No, no to occupation. No, no to terrorism. Yes for independence”. The current withdrawals are not seen as a step toward independence but to more covert and thus even more unaccountably violent American control – like the post-1932 British period.

American officials should heed the cautionary tale of the past, unwittingly invoked by Mr al-Maliki’s bluster. As the British ambassador in “independent” Iraq realised too late, Iraqis “never swallowed the fiction that [the advisers] are maintained as much, more even, for their good than for ours”. Independence remained a mirage as British trainers refused to entrust critical elements of Iraqi security to their trainees for fear of compromising British security. Security itself remained a pipe dream. As the isolated trainers grew increasingly susceptible to a paranoid groupthink about Iraqi politics, it became impossible for them to accept real withdrawal. The fortifications that protect US trainers from their trainees threaten to create a similar bubble.

In 1932 as now, rhetoric about withdrawal was aimed at global as much as Iraqi opinion. Instead of attending only to appearances, stoking the fears of a people familiar with nominal independence, the US and Iraqi governments should deliver the reality Iraqis and Americans want: “Yes for independence.”

The writer is assistant professor of history at Stanford University and author of Spies in Arabia

Is western supremacy but a blip as China rises to the global summit?

2009-06-25T04:00:00.000-07:00

The country's trajectory and the change in its people's values and aspirations are cause for heated debate. Two experts go head to head
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Martin Jacques and Will Hutton
The Guardian, Tuesday 23 June 2009
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Dear Will
It is now widely recognised that the balance of economic power is shifting from the rich world to the developing world. Indeed, the role accorded to the G20 rather than the G8 in seeking to tackle the financial crisis is a vivid illustration of this. But what is not recognised – and has been barely discussed – are the political and cultural ramifications of the rise of the developing countries. That, I suspect, is because there is a deeply held western view that they will – and should – end up as clones of western modernity: in other words, there is only one modernity and it is western. This is a fallacy. Modernity is a product of culture and history as much as markets and technology. The central question here is China: will it end up like us or will it be something very different and, as a result, change the world in very fundamental ways?
In my view, there is not a chance that China will become "western". Of course, it will be influenced by the west, as it already is, but it will remain profoundly different. To think otherwise is to believe that western norms are a universal pre-condition for successful modernisation. This is a highly provincial, and hubristic, mindset.
Let me give a number of examples of how China is and will remain different. Although for the last century it has described itself as a nation-state, in fact at its core China is a civilisation-state. The Chinese think of themselves primarily not as a nation but as a civilisation; all those things that constitute a sense of Chinese identity long predate China's short life as a nation-state. And the logic of a civilisation-state is very different: a necessary toleration of diversity because of the country's sheer size (as illustrated by the "one country, two systems" formula for Hong Kong); and a state which has for centuries been seen as the guardian of civilisation and therefore organic to society in a way quite different from the west.
Or take the example of race. Unlike any of the other most populous nations, 92% of Chinese regard themselves as of one race: that is a direct product of China's extraordinarily long history and civilisational consciousness. It also means that the Chinese do not recognise difference in the way that many societies do; and nor is that likely to change anytime soon. Consider also the fact that the Chinese state, for over a millennium, has, unlike Europe, never had to compete for power with other groups such as the church or merchants, with the consequence that there are no boundaries to its power. The Chinese state is, and will remain, very different from the western state, whatever happens to its present government.
None of these characteristics imply that China will not become a formidable power; but they will certainly make it a very different one. Why we should be surprised? The world is constituted of many different histories and cultures. It so happens that for a brief period of two centuries or so Europe (and its major derivative, the US) has dominated the world. That era is now coming to an end. Far from western universalism we are entering the age of contested modernity.
Martin
Dear Martin
More than 300 Chinese intellectuals and human rights activists put their name to Charter 08 last December on the anniversary of the UN Declaration of Human Rights – many have been subsequently arrested. What they want for China is an independent and impartial judiciary; freedom of speech and expression; free trade unions; a free media; the capacity to hold government to account by citizens – all institutions you dismiss as "western" and now to be contested by your forecast of China's imminent rule of the world. Pan Yue, Deputy head of China's Environmental Protection Agency, has warned that there is no chance of reversing China's disastrous growth of carbon and sulphur emissions – now larger than those of the US – unless civil society has the capacity to hold the mainly state owned polluting industries to account. Until China develops the institutions advocated by Charter 08 everybody in China knows there is not a chance – just as the hundreds of thousands mourning their dead children after the earthquake in Sichuan know they have no chance of holding the corrupt officials to account who commissioned the jerry built schools in which their kids died. The party's buildings stayed intact.
These are brave men and women, all of whom will be in silent despair about the innocent way another prominent western intellectual has bought the party's line. There is no more enthusiastic exponent of the thesis that China is a civilisation state than the party's propaganda department. The party thus takes refuge in some conception of "Chineseness" to excuse it from the consequences of authoritarianism, and shore up its own crisis of legitimacy. Its proposition is that the communism that aims to build a socialist market economy and which represents all of China's traditions – the three represents – is linked by a golden thread to China's great Confucian past. It is spearheading an economic revolution that will soon lead to Chinese world leadership. The Charter 08 signatories are thus wrong.
I find the notion that countries are condemned by their past to a future cast in the same mould empirically and philosophically wrong. The "civilisation state" is an empty construct: all states reflect their civilisations which in turn contain traditions that are in tension – individualism and collectivism, freedom and authority. If you mean that China is racially homogenous, what are your readers to make of that explosive claim? It is akin to claiming that everyone in the west is white, and therefore we think the same. But we don't. In any case there are vast cultural differences between the great agricultural provinces of Shandong and Henan and the bustling commerciality of the Pearl River delta and Shanghai. Do you not believe that there is a universal appetite for due desert for effort, for dignity and for the capacity to express self – and which Chinese culture amply expresses itself outside China in Taiwan, and in its own history? China's history is pockmarked with epic revolts against tyrannical dynasties excusing their tyranny as fealty to "Chineseness".
You will object that the middle class is hardly in revolt against the party. You are right – so far. It has been bought off with ample largesse, which is more a hard headed political and economic calculation easily recognisable in the west than anything to do with culture. So much depends upon continuing economic growth, but which I believe is unsustainable – at least until there is political change. You can side with the Propaganda Department and its dismissal of Charter 08's demands as western. I will stand with Charter 08.
Dear Will
There seems to be some distance between us. So let me try and establish some common ground. Do I sympathise with the signatories of Charter 08? Of course. Do I believe that China needs a more transparent and accountable system of governance? Of course. And – a question you didn't ask but might – do I deplore the shootings in Tiananmen Square and its environs? Certainly. Your seeming desire to paint me into a corner where you are the democrat and I am the anti-democrat really won't wash. We give similar answers to these questions. Where we differ is on whether China is fundamentally different from the west in key respects or whether it is destined – in time – to be a western-style society, more or less a clone of us. Alas, you reduce this issue to the complexion of the present government: in other words, difference is simply a matter of politics. I beg to differ.
You dismiss the idea of a civilisation-state – mainly because it appears to have been used by the Propaganda Department. Can I direct you to Lucian Pye, one of the foremost American scholars of China, who died recently? He wrote: "China is not just another nation-state in the family of nations. China is a civilisation pretending to be a nation-state." Far from being "an empty construct", as you suggest, it is fundamental to understanding the nature of China – the state, the idea of unity, the notion of race, the sense of identity and much else. The fact that it is an entirely unfamiliar concept to us and that it is rooted in Chinese history and reality rather than our own, is not a reason to brand it as an 'empty construct'.
Which brings me to the question of race. If 92% of Chinese believe that they are of one race does not mean, as you suggest, that I do. It is patently obvious that a population as large as China's is a product of many different races. But most Chinese do not think this. How do we explain this; and why are Chinese attitudes so different from those of other populous countries, namely India, the United States, Indonesia and Brazil? I hope you are not going to tell me that the present government is responsible for this too. On the contrary, this is a function of China's civilisational history which has led to a long drawn-out process of assimilation, conquest and melding. The consequence is of great importance: the Chinese do not recognise difference. This is clear in the attitude of the Han Chinese towards the Tibetans and the Uighurs. So how will China as a global power relate to a world which is defined by difference: one cannot be too hopeful.
Let me conclude with what seems to me an absolutely fundamental difference between us. Your underlying view appears to be that there is only one form of modernity and that is western. Sooner or later all non-western countries must adopt western-style institutions, practices and values or else fail. In other words, we are the only ones with anything to offer. This, of course, makes political and cultural analysis of non-western societies much easier. We don't really need to understand them in their specificity, we just need to know how westernised they are. It seems to me to be the height of western hubris to believe that all wisdom resides in the west; on the contrary, all societies embody originality and insights from which we can all learn, the west included. As we move into an increasingly non-western world, this will become blindingly obvious.
Martin
Dear Martin
I agree that China's attitudes towards the Tibetans and Uighurs are oppressive, and that if they were reproduced when China rules the world – a prediction I think will not happen - nobody would like it much. You tell me this is the product of China being a civilisation state, to abandon western hubris and to learn wisdom from others. I presume the "insights and originality" hubristic westerners should admire are to do with China's economy; you would not want us to adopt China's attitude to foreigners, racial diversity or its assumptions of superiority.
However you have evaded my argument. Voting is the coping stone of democracy – but it is flanked and buttressed by much more. Democracy is about justice, accountability, plurality, checks and balances and all the processes that go with them. It is as much about effective company auditing, reliable official statistics, independent trade unions and strong corporate governance as it is about arrest and detention without trial or freedom of expression. However these are all interdependent "Enlightenment" institutions that stand or fall together, and bit by bit most of Asia is acquiring and deepening them whether India, South Korea or Japan. In these terms there is the beginning of an Asian Enlightenment reflecting fundamental human desires which when obstructed produce economic and social dysfunctions.
For unlike you I think China's economic and social model is dysfunctional. It is not just corrupt and environmentally dangerous. It is wildly unbalanced and lacking in innovation. The wastefulness of the system has been disguised by monumental saving which is so very high precisely because so many Chinese do not believe that the regime and model have much of a future. It desperately needs the institutional apparatus that houses great businesses and the innovation process, and the confidence in the future that allows consumers to consume.
Is China culturally predetermined not to move in the same direction as the rest of Asia? Most studies of the relationship between culture, economics and politics underline their malleability and lack of rigid predetermination: Lucian Pye's views were at one end of the spectrum. Even for those few hard-line cultural determinists like yourself the Ingelhart-Welzel cultural map of the world shows how close Chinese and European culture is – secular, rational, non-traditional and emphasising subjective well-being and the quality of life – suggesting the gap is much more narrow than you argue.
Of course we must learn from China. Tu Weiming, the world's premier Confucius scholar, shows the profound complimentarity of Confucian and Enlightenment values. He would find your concentration on the racial dimension and appetite for authoritarian government in China's culture as eccentric – even downright offensive. Charter 08 signatories much more relevantly represent the complexity of China's aspirations. This is not western hubris: I am extremely critical of the west's inability to live by Enlightenment standards. But China needs to develop its own variant of what is happening in the rest of Asia. I am confident that one day it will – and your fear of the yellow peril and rejoice in the decline of the west will both be confounded.
Best Will
Dear Will
I wouldn't exaggerate the extent to which east Asian and western societies have converged, as you seem to suggest. East Asia, of course, is a huge region, home to a third of the world's population and many very different cultures. But let us take the one that might appear most westernised, namely Japan. In fact, it remains profoundly different: social relations are shame-based rather than guilt-based and very hierarchical; the legal system plays a much smaller role than in western societies; and the labour force is far more gendered. Not least, its political system differs greatly. It is often classified as western. Certainly there is universal suffrage and a multi-party system but, as you know, the Liberal Democrats have been in power more or less permanently since the mid-50s and, as Karel van Wolferen argues, power really lies in the bureaucracy. So while Japan has the trappings of a western-style democracy in practice power resides in a Japanese-style Confucian state. It is not like China nor is it like the west. Japan enjoys a very different kind of modernity of its own. Get it?
Alas, you have virtually nothing positive to say about China. Is that because you have become a China-denier, always predicting ultimate failure, even though for 30 years it has been astoundingly successful? You are right of course that its present model is unsustainable. But no serious economist in China thinks it is. Indeed, a double-digit growth rate since 1978 could only have been achieved by a constant and radical process of change and reform. You give no credit to the Chinese government in presiding over what is an extraordinary achievement. Sure, fundamental changes must be made to the growth model in due course; and that is probably exactly what will happen, just as it did with the earlier Asian tigers.
Martin
Dear Martin
If I didn't know you better I'd think you were an old Marxist swapping culture for class conflict in an attempt to create another determinist account of history. Of course Japan's democratic institutions are Japan specific; so are Britain's, France's, Brazil's and South Korea's. The argument is less interesting than paint drying. The point is that country specific democratic institutions evolve, change and mutate – and sit in creative tension with particular economies and societies as they develop. In Japan opposition candidate Toshihito Kumagai has just been voted overwhelmingly mayor of Chiba once a LDP citadel, portending the end of the LDP's fraying hegemony. Japan's seventeen year stagnation is forcing change in its economic model and society; at the same time it is readier to question, less deferential and more willing to use the courts than in van Wolferen's time. Its democratic institutions – as imperfect as Britain's – are moving it on.
I am not your straw man – the hubristic westerner predicting all societies converge on the western model. Of course societies have particularities. But the human appetite for self-expression, dignity and fairness is universal. Country-specific democratic institutions permit their expression and unleash great dynamism.
Your characterisation of Confucianism, with its simultaneous apocalyptic and grandiose predictions for China, is barely more than a cartoon. In The Writing on the Wall I acknowledge China's achievement over the last 30 years. 400 million being released from poverty is quite something. But I observe the flaws, and believe they are set to intensify. Economic models and institutions have to change as economic development proceeds. You have yet seriously to confront my two core questions. Does China need democratic institutions to support the next phase of its growth? Is there any reason why it should not have them except for the communist party's opposition?
Will
Dear Will
It is time to call a halt to our discussion, so let me conclude with two points.
I believe that the rise of the developing countries, above all China and India, marks, in a rough and ready way, a huge democratic advance for the human race. For 200 years, the western world (and later Japan) – together constituting a small minority of the global population – has dominated the world and to all intents and purposes run it. The rest of the world – the overwhelming majority – until now has found itself marginalised and without a serious voice. When we talk about democracy in the west we almost invariably mean the democracy of individual nations, not the democracy of the world, with the enfranchisement of different societies, cultures and traditions. The rise of China and India, which account for 38% of the global population, will represent a huge democratisation of global governance, whether or not China becomes more democratic (and in time I certainly think it will).
At root you seem to believe that western dominance is eternal. I beg to differ. In fact, it will prove relatively short-lived. It started around the late eighteenth century and will fade during the course of this. But this is the story of humanity: the rise and fall of different civilisations. Your argument is that this time it will be different: that unless countries are essentially like the west then they will fail. I accept, with you, that some values are universal. But the rise of China, and India indeed, will be accompanied by the ascendancy of new values which are not reducible to western values and will certainly conflict with some of them. You endorse Confucianism in so far as it converges with our own values, but fall silent on where it is different (and might even have something to teach us). In your view, our values are always superior. I have a more nuanced position: some of our values are precious and to be treasured, others are not. Which do I think fall into the latter category: above all the one which you never seem to mention, the presumption of western superiority which has made us such an aggressive, expansionist and colonising force for most of that two hundred years. I have the same nuanced attitude towards Chinese culture (and others): some of the values are to be honoured, others are not.
Martin
Dear Martin
Trying to assume the mantle of being nuanced about China when you have just written a book called When China Rules the World is a bit rich, as is trying continually to paint me as an unsubtle champion of western values. I am not. As a matter of fact, as Amartya Sen always claims, it was the Indian Emperor Ashoka in the third century BC who first insisted on the value of pluralism, respect for argument and dissent, along with tolerance for minorities.
Some economic history is illuminating. Between 1750 and 2000 global GDP per person has exploded some 37 times after millennia of stagnation. The explosion has been driven by market capitalism interacting with all that we call democracy – a fundamentally new form of economic and political organisation which first grew to fruition in the west. Before 1750 China could claim to be the centre of the world. After 1750 it could not. You now think its recent growth portends a reversal to the historical norm.
But this change over the last 250 years is going to continue and it will be led by those societies best able to manage this combination of capitalist dynamism with democratic institutions. China, as Deng Xiaoping understood, has to share in this dynamism or be left behind – hence his market reform programme, and for many Dengists an eventual programme of political reform. However China is now stuck; and the weaknesses increasingly obvious.
The good news is that western societies are no longer the only ones trying to build this complex matrix of institutions, even if they are still best placed because of the legacy of being first movers. The bad news is that capitalism creates vicious inequalities and instabilities – none less than in China's incomplete revolution, but also in the system as a whole. The task ahead is to promote much better understanding of the links between capitalism and democratic governance, and above all of the need for equity and mutual accountability. It is a permanent job of criticism and renewal. My fear is that innocents like yourself, proclaiming China's comeback in pre 1750 terms and decrying universal values as "western", take us in the wrong direction. A tragedy for the world – and a tragedy for China.
Will
Jacques book is When China Rules etc published this week; Will Hutton is authior of endnote authior of endnote authior of endnote authior of endnote authior of endnote

Poverty is a human rights issue

2009-06-25T03:59:00.000-07:00

Conor Foley may not agree, but by bringing human rights into the poverty debate Amnesty can hold governments to account
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Kate Allen
guardian.co.uk, Friday 19 June 2009 14.00 BST
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Contrary to recent articles by Conor Foley and William Easterly, Amnesty International does believe that poverty is a human rights issue. To be clear – the basic human rights of the millions of people around the world who are living in poverty are being violated. Thousands of families forced to live in slum conditions in Kenya and Cambodia and facing the constant threat of imminent eviction by authorities who won't consult them; Palestinian children who are prevented from going to school because of Israeli curfews and road closures; women who die in childbirth because they live in societies that condone early marriage and where a basic standard of maternal care is not provided – these people are all having their human rights violated. Just because a single individual neat violator can't always be sited does not mean that injustice is not being done.
The main problem however with Foley's critique of Amnesty's work is that he refers in the main to aid and aid policy, and he seems to think Amnesty is simply moving into this area too, as if that's all poverty was really about. Far from it. For us at Amnesty living in poverty is more than suffering material deprivation – it is being marginalised, being without power or influence over decisions that affect your life. Amnesty is currently campaigning to stop the forced eviction of more than 7,000 people from their homes in Nairobi, Kenya, where the local authority wants to sell the land to developers. "Deep Sea" residents have been forced from their homes in the middle of the night, which were then destroyed by bulldozers. The police stood by while it happened. This ongoing campaign is much more complex than "straightforward poverty" or the rights and wrongs of aid relationships. But it is without doubt a struggle for human rights.
Foley also seems to equivocate over whether the international community is obliged to provide protection for people affected by conflict or disasters, and development assistance in general. He rightly says that economic and social rights are supposed to be implemented progressively, but then balks at what follows — that all states must ensure these rights are realised, including, when they are in a position to do so, by providing international assistance. There may be a debate about how exactly this is to be done, but international law is clear that everyone is entitled to an adequate standard of living, to be free from hunger, to basic healthcare and to at least a free primary education. And in case there is any doubt about this these rights have been tested in law – they are written into the constitutions of India and South Africa and have for example been used to require governments and companies to make anti-retroviral drugs for people living with HIV/Aids available to them.
What is most disappointing about Foley's piece is that we know he's one of the good guys. Governments, companies and international institutions rely on the very complexity of economic, social and cultural rights violations to make would-be advocates throw their hands up and not know where or whether to start. But that sense of the enormity of the task ahead was there after the second world war when the original human rights treaties were drawn up, and now decades later we have changed the discourse about rights and what governments know they can and cannot do.
In the real world many aid agencies, UN agencies and donor governments have already adopted a rights-based approach to development. Amnesty believes strongly that bringing human rights into the debate on poverty is one of the most powerful ways to make poverty alleviation accountable to those it is supposed to help. And exactly because we are not an aid agency, trying to work with a given government's acquiescence, we can be very bold in challenging governments to be accountable to all their citizens.

will the cat above the precipice fall down?

2009-06-25T03:58:00.000-07:00

Slavoj Zizek

When an authoritarian regime approaches its final crisis, its dissolution as a rule follows two steps. Before its actual collapse, a mysterious rupture takes place: all of a sudden people know that the game is over, they are simply no longer afraid. It is not only that the regime loses its legitimacy, its exercise of power itself is perceived as an impotent panic reaction. We all know the classic scene from cartoons: the cat reaches a precipice, but it goes on walking, ignoring the fact that there is no ground under its feet; it starts to fall only when it looks down and notices the abyss. When it loses its authority, the regime is like a cat above the precipice: in order to fall, it only has to be reminded to look down…In Shah of Shahs, a classic account of the Khomeini revolution, Ryszard Kapuscinski located the precise moment of this rupture: at a Tehran crossroad, a single demonstrator refused to budge when a policeman shouted at him to move, and the embarrassed policeman simply withdrew; in a couple of hours, all Tehran knew about this incident, and although there were street fights going on for weeks, everyone somehow knew the game is over. Is something similar going on now? There are many versions of the events in Tehran. Some see in the protests the culmination of the pro-Western “reform movement” along the lines of the “orange” revolutions in Ukraine, Georgia, etc. – a secular reaction to the Khomeini revolution. They support the protests as the first step towards a new liberal-democratic secular Iran freed of Muslim fundamentalism. They are counteracted by skeptics who think that Ahmadinejad really won: he is the voice of the majority, while the support of Mousavi comes from the middle classes and their gilded youth. In short: let’s drop the illusions and face the fact that, in Ahmadinejad, Iran has a president it deserves. Then there are those who dismiss Mousavi as a member of the cleric establishment with merely cosmetic differences from Ahmadinejad: Mousavi also wants to continue the atomic energy program, he is against recognizing Israel, plus he enjoyed the full support of Khomeini as a prime minister in the years of the war with Iraq.Finally, the saddest of them all are the Leftist supporters of Ahmadinejad: what is really at stake for them is Iranian independence. Ahmadinejad won because he stood up for the country’s independence, exposed elite corruption and used oil wealth to boost the incomes of the poor majority – this is, so we are told, the true Ahmadinejad beneath the Western-media image of a holocaust-denying fanatic. According to this view, what is effectively going on now in Iran is a repetition of the 1953 overthrow of Mossadegh – a West-financed coup against the legitimate president. This view not only ignores facts: the high electoral participation – up from the usual 55% to 85% - can only be explained as a protest vote. It also displays its blindness for a genuine demonstration of popular will, patronizingly assuming that, for the backward Iranians, Ahmadinejad is good enough - they are not yet sufficiently mature to be ruled by a secular Left.Opposed as they are, all these versions read the Iranian protests along the axis of Islamic hardliners versus pro-Western liberal reformists, which is why they find it so difficult to locate Mousavi: is he a Western-backed reformer who wants more personal freedom and market economy, or a member of the cleric establishment whose eventual victory would not affect in any serious way the nature of the regime? Such extreme oscillations demonstrate that they all miss the true nature of the protests. The green color adopted by the Mousavi supporters, the cries of “Allah akbar!” that resonate from the roofs of Tehran in the evening darkness, clearly indicate that they see their activity as the repetition of the 1979 Khomeini revolution, as the return to its roots, the undoing of the revolution’s later corruption. This return to the roots is not only programmatic; it concerns even more the mode of activity of the crowds: the emphatic unity of the people, their all-encompassing solidarity, creative self-organization, improvising of the ways to articulate protest, the unique mixture of spontaneity and discipline, like the ominous march of thousands in complete silence. We are dealing with a genuine popular uprising of the deceived partisans of the Khomeini revolution.There are a couple of crucial consequences to be drawn from this insight. First, Ahmadinejad is not the hero of the Islamist poor, but a genuine corrupted Islamo-Fascist populist, a kind of Iranian Berlusconi whose mixture of clownish posturing and ruthless power politics is causing unease even among the majority of ayatollahs. His demagogic distributing of crumbs to the poor should not deceive us: behind him are not only organs of police repression and a very Westernized PR apparatus, but also a strong new rich class, the result of the regime’s corruption (Iran’s Revolutionary Guard is not a working class militia, but a mega-corporation, the strongest center of wealth in the country).Second, one should draw a clear difference between the two main candidates opposed to Ahmadinejad, Mehdi Karroubi and Mousavi. Karroubi effectively is a reformist, basically proposing the Iranian version of identity politics, promising favors to all particular groups. Mousavi is something entirely different: his name stands for the genuine resuscitation of the popular dream which sustained the Khomeini revolution. Even if this dream was a utopia, one should recognize in it the genuine utopia of the revolution itself. What this means is that the 1979 Khomeini revolution cannot be reduced to a hard line Islamist takeover – it was much more. Now is the time to remember the incredible effervescence of the first year after the revolution, with the breath-taking explosion of political and social creativity, organizational experiments and debates among students and ordinary people. The very fact that this explosion had to be stifled demonstrates that the Khomeini revolution was an authentic political event, a momentary opening that unleashed unheard-of forces of social transformation, a moment in which “everything seemed possible.” What followed was a gradual closing through the take-over of political control by the Islam establishment. To put it in Freudian terms, today’s protest movement is the “return of the repressed” of the Khomeini revolution.And, last but not least, what this means is that there is a genuine liberating potential in Islam – to find a “good” Islam, one doesn’t have to go back to the 10th century, we have it right here, in front of our eyes.The future is uncertain – in all probability, those in power will contain the popular explosion, and the cat will not fall into the precipice, but regain ground. However, it will no longer be the same regime, but just one corrupted authoritarian rule among others. Whatever the outcome, it is vitally important to keep in mind that we are witnessing a great emancipatory event which doesn’t fit the frame of the struggle between pro-Western liberals and anti-Western fundamentalists. If our cynical pragmatism will make us lose the capacity to recognize this emancipatory dimension, then we in the West are effectively entering a post-democratic era, getting ready for our own Ahmadinejads. Italians already know his name: Berlusconi. Others are waiting in line.
// posted by it @ 2:06 PM //
23 June 2009
open letter of support to the demonstrators in iran Friday 19 June 2009This morning Ayatollah Ali Khamenei demanded an end to the massive and forceful demonstrations protesting the controversial result of last week's election. He argued that to make concessions to popular demands and 'illegal' pressure would amount to a form of 'dictatorship', and he warned the protestors that they, rather than the police, would be held responsible for any further violence. Khamenei's argument sounds familiar to anyone interested in the politics of collective action, since it appears to draw on the logic used by state authorities to oppose most of the great popular mobilisations of modern times, from 1789 in France to 1979 in Iran itself. These mobilisations took shape through a struggle to assert the principle that sovereignty rests with the people themselves, rather than with the state or its representatives. 'No government can justly claim authority', as South Africa's ANC militants put it in their Freedom Charter of 1955, 'unless it is based on the will of all the people.'Needless to say it is up to the people of Iran to determine their own political course. Foreign observers inspired by the courage of those demonstrating in Iran this past week are nevertheless entitled to point out that a government which claims to represent the will of its people can only do so if it respects the most basic preconditions for the determination of such a will: the freedom of the people to assemble, unhindered, as an inclusive collective force; the capacity of the people, without restrictions on debate or access to information, to deliberate, decide and implement a shared course of action.Years of foreign-sponsored 'democracy promotion' in various parts of the world have helped to spread a well-founded scepticism about civic movements which claim some sort of direct democratic legitimacy. But the principle itself remains as clear as ever: only the people themselves can determine the value of such claims. We the undersigned call on the government of Iran to take no action that might discourage such determination.

The recession tracks the Great Depression

2009-06-22T03:39:00.000-07:00

By Martin Wolf

Published: June 16 2009 19:41 | Last updated: June 16 2009 19:41

Green shoots are bursting out. Or so we are told. But before concluding that the recession will soon be over, we must ask what history tells us. It is one of the guides we have to our present predicament. Fortunately, we do have the data. Unfortunately, the story they tell is an unhappy one.

EDITOR’S CHOICE

Tight rules helped mitigate crisis in Brazil - Jun-16

Economists’ forum - Oct-01

Opinion: The three steps to financial reform - Jun-16

In depth: Global financial crisis - Sep-04

Economics: How the world economy might recover its poise - Jun-15

Two economic historians, Barry Eichengreen of the University of California at Berkeley and Kevin O’Rourke of Trinity College, Dublin, have provided pictures worth more than a thousand words (see charts).* In their paper, Profs Eichengreen and O’Rourke date the beginning of the current global recession to April 2008 and that of the Great Depression to June 1929. So what are their conclusions on where we are a little over a year into the recession? The bad news is that this recession fully matches the early part of the Great Depression. The good news is that the worst can still be averted.

First, global industrial output tracks the decline in industrial output during the Great Depression horrifyingly closely. Within Europe, the decline in the industrial output of France and Italy has been worse than at this point in the 1930s, while that of the UK and Germany is much the same. The declines in the US and Canada are also close to those in the 1930s. But Japan’s industrial collapse has been far worse than in the 1930s, despite a very recent recovery.

Second, the collapse in the volume of world trade has been far worse than during the first year of the Great Depression. Indeed, the decline in world trade in the first year is equal to that in the first two years of the Great Depression. This is not because of protection, but because of collapsing demand for manufactures.

Third, despite the recent bounce, the decline in world stock markets is far bigger than in the corresponding period of the Great Depression.

The two authors sum up starkly: “Globally we are tracking or doing even worse than the Great Depression ... This is a Depression-sized event.”

Yet what gave the Great Depression its name was a brutal decline over three years. This time the world is applying the lessons taken from that event by John Maynard Keynes and Milton Friedman, the two most influential economists of the 20th century. The policy response suggests that the disaster will not be repeated.

Profs Eichengreen and O’Rourke describe this contrast. During the Great Depression, the weighted average discount rate of the seven leading economies never fell below 3 per cent. Today it is close to zero. Even the European Central Bank, most hawkish of the big central banks, has lowered its rate to 1 per cent. Again, during the Great Depression, money supply collapsed. But this time it has continued to rise. Indeed, the combination of strong monetary growth with deep recession raises doubts about the monetarist explanation for the Great Depression. Finally, fiscal policy has been far more aggressive this time. In the early 1930s the weighted average deficit for 24 significant countries remained smaller than 4 per cent of gross domestic product. Today, fiscal deficits will be far higher. In the US, the general government deficit is expected to be almost 14 per cent of GDP.

All this is consistent with the conclusions of an already classic paper by Carmen Reinhart of the university of Maryland and Kenneth Rogoff of Harvard.** Financial crises cause deep economic crises. The impact of a global financial crisis should be particularly severe. Moreover, “the real value of government debt tends to explode, rising an average of 86 per cent in the major post–World War II episodes”. The chief reason is not the “bail-outs” of banks but the recessions. After the fact, runaway private lending turns into public spending and mountains of debt. Creditworthy governments will not accept the alternative of a big slump.

The question is whether today’s unprecedented stimulus will offset the effect of financial collapse and unprecedented accumulations of private sector debt in the US and elsewhere. If the former wins, we will soon see a positive deviation from the path of the Great Depression. If the latter wins, we will not. What everybody hopes is clear. But what should we expect?

We are seeing a race between the repair of private balance sheets and global rebalancing of demand, on the one hand, and the sustainability of stimulus, on the other.

Robust private sector demand will return only once the balance sheets of over-indebted households, overborrowed businesses and undercapitalised financial sectors are repaired or when countries with high savings rates consume or invest more. None of this is likely to be quick. Indeed, it is far more likely to take years, given the extraordinary debt accumulations of the past decade. Over the past two quarters, for example, US households repaid just 3.1 per cent of their debt. Deleveraging is a lengthy process. Meanwhile, the federal government has become the only significant borrower. Similarly, the Chinese government can swiftly expand investment. But it is harder for policy to raise levels of consumption.

The great likelihood is that the world economy will need aggressive monetary and fiscal policies far longer than many believe. That is going to be make policymakers – and investors – nervous.

Two opposing dangers arise. One is that the stimulus is withdrawn too soon, as happened in the 1930s and in Japan in the late 1990s. There will then be a relapse into recession, because the private sector is still unable, or unwilling, to spend. The other danger is that stimulus is withdrawn too late. That would lead to a loss of confidence in monetary stability worsened by concerns over the sustainability of public debt, particularly in the US, the provider of the world’s key currency. At the limit, soaring dollar prices of commodities and rising long-term interest rates on government bonds might put the US – and world economies – into a malign stagflation. Contrary to some alarmists, I see no signs of such a panic today. But it might happen.

Last year the world economy tipped over into a slump. The policy response has been massive. But those sure we are at the beginning of a robust private sector-led recovery are almost certainly deluded. The race to full recovery is likely to be long, hard and uncertain.

martin.wolf@ft.com

More columns at www.ft.com/martinwolf

UK legal industry faces loss of 10,000 lawyers

2009-06-22T03:37:00.000-07:00

Alex Spence

As many as 10,000 lawyers could be out of work in the UK in the next two years as the legal business faces its worst slump in decades.

More than one in ten of the country’s 83,000 privately employed solicitors could lose their jobs, recruiters, consultants and senior law firm partners told The Times, and will struggle to find new jobs even as the economy emerges from the recession.

The total number of jobs in the legal sector, including non-solicitors, fell by 16,700 in 2008, from 296,500 to 279,800, according to the Office for National Statistics, and the scale of losses is set to worsen this year.

The shake-up has thrown the traditionally conservative sector into turmoil, with leading firms shedding thousands of jobs, freezing salaries and telling trainees who expected to be offered permanent employment that they will not be kept on. Even partners, once regarded as secure for life, have not been spared. Industry observers said that further job losses were inevitable.

Lawyers who fall out of work have little hope of finding new jobs, with vacancies for associate solicitors down by 95 per cent this year, recruiters said. “It’s the worst year ever, by some margin,” Nick Root, founding partner of Taylor Root, a leading recruitment agency, said. “Those people who are being let go will not get another job.”

Meanwhile, thousands of new law graduates this year will intensify the recruitment squeeze.

Britain’s commercial legal sector, which contributes more than £15 billion a year to the economy, grew at a dizzying rate in recent years, driven by mergers and acquisitions, commercial property, private equity and leveraged finance.

In 2007-08, the 100 biggest firms enjoyed record profits of more than £4 billion and hundreds of partners earned in excess of £1 million.

But the market shuddered to an abrupt halt in September after the collapse of Lehman Brothers. Profits are plummeting: in recent weeks, leading firms, such as Eversheds, Hebert Smith, Lovells and Norton Rose, reported a decline in partners’ earnings of up to a third for the 2008-09 financial year, which ended on April 30. As those results were boosted by a healthy first-half, next year’s results are likely to be bleaker still.

Not only are partners experiencing a sharp reverse in earnings, but, unlike in previous recessions, many are losing their jobs. Scores have been pushed out from the City’s biggest firms — including 47 at Allen & Overy, part of the “magic circle” — while others have been stripped of equity and forced to take a pay cut.

Discarded partners accustomed to earning more than £700,000-a-year have been shocked to find that they can command as little as £200,000 from the few firms that are hiring.

Firms are placing a greater emphasis on productivity, recruiters said, insisting that prospective hires bring with them a dependable client following. In some cases, partners have been offered commission-only deals — pay historically has been based on tenure rather than performance.

Unemployed junior lawyers are finding it even tougher, with one recruitment agency receiving about 700 applications for three entry-level vacancies. Those associates who have kept their jobs have had their salaries frozen.

UK commercial law firms remain internationally competitive and will recover, Scott Gibson, a consultant at Hughes-Castell, a recruitment agency, said.

However, they are likely to emerge from the recession leaner, with a smaller ratio of associates to partners and more aggressively managed. The notion of job security at big law firms is unlikely to endure. “No lawyer is ever going to think they’ve got a safe job again,” Mr Gibson said.

Complicity with cruelty

2009-06-22T03:36:00.000-07:00

The advice to MI6 officers reveals deeply troubling equivocation about Britain's responsibility not to abet abuse of detainees

- Philippe Sands and Alex Bailin
- guardian.co.uk, Thursday 18 June 2009 00.00 BST
- Article history

Very little is known about Britain's policy on the overseas treatment of detainees by British intelligence personnel after September 11. What is known is deeply troubling. In early 2005 a report by the intelligence and security committee on the handling of detainees by UK intelligence personnel included extracts of instructions sent to British intelligence personnel in Afghanistan.

These require British personnel not to engage in abuse, but they do not require them to intervene to prevent abusive behaviour if they see detainees being treated by others in a manner that does not meet "appropriate standards". In such circumstances, if possible, they need to do no more than consider drawing concerns "to the attention of a suitably senior US official locally".

These instructions are striking for what they do not require: where abuse or torture has occurred or may occur, there is no requirement to prevent it or to disengage from the interview process. This opens the door to complicity in torture: provided that coercion is not "in conjunction with an SIS [MI6] interview", British involvement may continue. Knowledge of prior abuse, or knowledge as to the risk or likelihood of later abuse, would not be a bar to continued British involvement.

One should be cautious about reading too much into an incomplete extract and where there is no information as to the underlying legal advice. But the tenor of this text raises serious concerns. Did the instructions allow crimes to be committed? It seems they may have done so.

Article 4 of the 1984 UN convention against torture, to which the UK is a party, criminalises "an act by any person which constitutes complicity or participation in torture". Parliament's joint committee on human rights has taken evidence on the meaning of "complicity". The English courts have not interpreted Article 4 and any case will turn on its particular facts. But before 2002, when the "instructions" were circulated, international law provided guidance on the standard needed to avoid charges of complicity.

The 1998 Rome statute of the international criminal court extends criminal responsibility where military commanders and civilian superiors "should have known" that international crimes were being committed but "failed to take all necessary and reasonable measures within his or her power to prevent or repress their commission".

The 1984 convention's committee against torture has ruled that there is acquiescence where the police have been informed of an "immediate risk" of abuse and, if present at the scene, did not take steps to protect the victims. In this way, turning a blind eye or failing to take steps to prevent abuse is not enough to avoid liability.

This is consistent with a 1998 judgment by the international criminal tribunal for the former Yugoslavia. Its appeal chamber treated "complicity" as being akin to "aiding and abetting" or "assistance" that could be "physical or in the form of moral support". A crime could be committed even if the abettor did not take any tangible action, provided the actions "directly and substantially" assisted and where there was "knowledge … that torture is being practised". The Appeals Chamber did not mince words:

"if an official interrogates a detainee while another person is inflicting severe pain or suffering, the interrogator is as guilty of torture as the person causing the severe pain or suffering, even if he does not in any way physically participate in such infliction."

In a 2005 House of Lords judgment, Lord Bingham said that "the prohibition of torture requires member states to do more than eschew the practice of torture".

This is consistent with the view recently expressed by Martin Scheinin, the UN special rapporteur on human rights, that "active participation through the sending of interrogators or questions, or even the mere presence of intelligence personnel at an interview with a person who is being held in places where his rights are violated, can be reasonably understood as implicitly condoning such practices".

On these principles it is difficult to avoid the conclusion that the 2002 "instructions" were incompatible with Britain's international obligations. They may have caused British personnel to cross a line into complicity, with responsibility ensnaring ministers who approved a policy which basically said: so long as you don't directly participate in physical abuse you can press on with interviews, passing on questions.

That, presumably, is why the policy changed in 2004, after the Abu Ghraib abuses came to light. And that is why we need a full inquiry on the evolution of the policy: who decided what and when.

Alex Bailin is a criminal barrister at Matrix Chambers

Obama and Darling too soft on bankers

2009-06-22T03:35:00.000-07:00

There has never been a better time to cut finance down to size, but Washington and London have ducked the chance to do so

- Larry Elliott
- guardian.co.uk, Wednesday 17 June 2009 18.30 BST
- Article history

Two years ago, Gordon Brown used his last Mansion House speech to praise the City for its enterprise and verve. Labour's light-touch regulatory regime had, he boasted, created the right environment for London to become the world leader in financial services.

There will be a bit less of that sort of talk when Alistair Darling addresses the Square Mile's great and good tonight. We must learn the lessons of the past, the chancellor will insist. There must be no repetition of the behaviour that led to the most serious financial meltdown in living memory. Anyone who thinks we can carry on as before should think again.

In reality, though, the government is planning no more than a slap on the wrist for the discredited bankers. The message from London – and from the Obama administration in Washington today – is that the chance for radical overhaul has been ducked. The chancellor has made it clear he retains faith in the tripartite system of regulation that failed so badly in the run-up to the crisis and believes the first line of defence should be tougher scrutiny of banks by their own directors.

But, as Vince Cable noted today, it was self-regulation that got us into this mess and it would be madness to return to business as usual.

Obama has fallen into the same trap. The president has announced that the Federal Reserve, America's central bank, is to have a bigger role in supervision. That sounds tough but in fact creates the conditions for a classic conflict of interest. The running of the Federal Reserve in Washington reflects the views of the 12 regional reserve banks, each of which have nine-person boards, two-thirds of whom are elected by local banks. To be fair, bits of the Obama blueprint are welcome. He wants greater constraints on leverage and restrictions on securitised products; both are good ideas, but they do nothing to change the status quo.

So what's wrong with the softly-softly approach? First, this has been a financial crisis of extreme severity, with global economic ramifications. Second, it was not a one-off event, but instead the culmination of a period of speculative excess that spawned smaller, but still serious, financial upsets around the world in the preceeding years. Finally, the systemic weaknesses of de-regulated finance suggest that a failure to act decisively now to put financial capital back in its cage will lead to the problems of the past two years re-surfacing before long.

The past two years have seen a belated interest in the work of the US economist Hyman Minsky, who warned in the 1970s that left to its own devices the financial sector would move from stability to fragility, making the economy vulnerable to painful debt deflations. Unfortunately, Minsky's ideas do not seem to have penetrated the Treasury, either in the UK or the US.

Darling is right to say that lessons must be learned. The big lesson, though, is that we permit banks that are "too big to fail" at our peril. One of Roosevelt's first decisions in 1933 was to pass the Glass-Steagall act, which legally separated retail from investment banking. That could be achieved today either by taking the banks into public ownership, breaking them up and then returning them to the private sector. Or it could be done through a draconian use of capital requirements, which would make it prohibitively expensive for what are primarily retail banks to dabble in the more exotic financial instruments. But the chances of either happening look remote. Two years into the crisis, the carnage caused by the follies of finance is strewn around the global economy; taxpayers have bailed out the City and Wall Street; and the banks are even bigger than they were before. Never has there been a better moment to cut finance down to size.

Sadly, unforgivably, governments have bottled it.

JUSTICE info

2009-06-16T03:11:00.000-07:00

JUSTICE STUDENT HUMAN RIGHTS NETWORK BULLETIN

Welcome to the Spring 2009 edition of the JUSTICE Student Human Rights Network bulletin.

The ninth edition of the free electronic bulletin features:
§ A welcome note
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§ Briefings on Article 3 of the European Convention on Human Rights and also on Procedural Safeguards in the EU
§ A 'what you can do section' that contains information about how you can get involved with JUSTICE as well as a guide to human rights websites that continues a series started on previous editions of this bulletin.

The JUSTICE Student Human Rights Network is now in its third year. Please help us to further develop the network by forwarding this email to anyone who may be interested in the bulletin or the network.

You can keep up to date with developments and future events of the network at http://www.justice.org.uk/jshrn/home.htm

JUSTICE is an independent, UK based charity which seeks to advance access to justice, human rights and the rule of law.

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Universities merged into business

2009-06-16T03:10:00.000-07:00

England's department for higher and further education has been scrapped, just two years after its creation.
The prime minister has created a new Department for Business, Innovation and Skills under Lord Mandelson.
Universities do not figure in the name of the new department, whose remit is "to build Britain's capabilities to compete in the global economy".
Number 10 said it would invest in a higher education system committed to widening participation.
The role would include "maintaining world class universities, expanding access to higher education, investing in the UK's science base and shaping skills policy and innovation".
"It also puts the UK's further education system and universities closer to the heart of government thinking about building now for the upturn," the statement said.
'Unhelpful'
The new department will be headed by Lord Mandelson.
John Denham, the secretary of state for the former Department for Innovation, Universities and Skills (Dius), has become Communities Secretary.
Mr Denham had run Dius since June 2007, when it was created from the division of the education department, when Gordon Brown became prime minister.
Dius had been created as a separate department for higher and further education - with the remainder of education becoming the Department for Children, Schools and Families, currently headed by Ed Balls.
The schools minister, Jim Knight, has also moved in the reshuffle, becoming minister of state for employment in the Department for Work and Pensions.
In response to the latest shake-up, the further education organisation, the Association of Colleges, said that "in the middle of a recession and with less than a year to run to an election it's unhelpful to introduce this degree of change in terms of ministerial responsibility".
Diana Warwick, head of the higher education body, Universities UK, said: "We are looking forward to an early meeting with Lord Mandelson."
"We want to work with him to continue the momentum in developing a higher education system that will equip people with the knowledge and skills to compete in a global economy and enhance Britain's existing world-class research base."
Pressure on places
The Million+ group, representing new universities, said that the department would have to address "immediate challenges".
"In particular the tens of thousands of potential students who will be turned away because there are no places for them at university this year."
This refers to a problem facing the new department this summer if, as has been forecast by universities, there is a shortfall of places following a surge in applications.
The UCU lecturers union expressed its disappointment at the scrapping of Dius.
General secretary Sally Hunt said she was "very concerned" that the "merger seems to signal that further and higher education are no longer considered important enough to have a department of their own".
"The fact they have been lumped in with business appears to be a clear signal of how the government views colleges and universities and their main roles in this country."
It is not yet clear how the new department will work in terms of devolved government, as the defunct department was an England-only structure.

Disarray over terror control orders after law lords ruling

2009-06-16T03:09:00.002-07:00

Frances Gibb, Legal Editor
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Three men have won a unanimous ruling from Britain’s highest court that strikes a massive blow to the “control orders” regime for detaining terror suspects.
A rare panel of nine law lords allowed an appeal by three terror suspects on the grounds that they did not know what they were accused of and secret evidence was used against them.
The strongly-worded ruling, hailed as “historic” by human rights groups, means that many of the 17 terror suspects now held under the controversial orders will have to have their cases re-examined.
One of the law lords, Lord Hope of Craighead, said: “If the rule of law is to mean anything, it is in cases such as these that the court must stand by principle. It must insist that the person affected be told what is alleged against him.”
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Alan Johnson, the Home Secretary, said he was “disappointed” but made clear that the Government would contest each case vigorously.
He said: “This is an extremely disappointing judgment. Protecting the public is my top priority and this judgment makes that task harder. Nevertheless, the Government will continue to take all steps we can to manage the threat presented by terrorism.”
He said that all control orders would remain in force for the time being, adding: “We will continue to seek to uphold them in the courts. In the meantime we will consider this judgment and our options carefully.
“We introduced control orders to limit the risk posed by suspected terrorists whom we can neither prosecute nor deport. The Government relies on sensitive intelligence material to support the imposition of a control order, which the courts have accepted would damage the public interest to disclose in open court.
“We take our obligations to human rights seriously and as such we have put strong measures in place to try to ensure that our reliance on sensitive material does not prejudice the right of individuals subject to control orders to a fair trial.”
The control order regime was introduced in March 2005 as a means of holding terror suspects who have not been charged or tried and where the evidence is largely sensitive and derived from intelligence sources.
Instead they are held under a home curfew with electronic tagging and bans on whom they can meet and where they can go.
It is the third set-back by ministers in their efforts to deal with terror suspects while preserving the confidentiality of evidence obtained from intercepts.
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The control orders regime was introduced under the Prevention of Terrorism Act 2005 in response to the law lords’ landmark ruling that to hold foreign terror suspects without charge or trial in Belmarsh prison was a breach of their human rights and unlawful.
The men can challenge their control orders - but they are not allowed to see any of the secret intelligence assessments that form the basis of decision to restrict their liberty.
In October 2007 the law lords ruled that the most draconian restriction under the control order regime, an 18-hour curfew, was also a breach of the European Convention on Human Rights.
Today, ruling in favour of the men, Lord Phillips of Worth Matravers, the senior law lord, said: "A trial procedure can never be considered fair if a party to it is kept in ignorance of the case against him."

We won't collude with efforts to use the academy to police immigration

2009-06-16T03:09:00.001-07:00

7 May 2009
Ann Singleton, Steve Tombs and David Whyte decry the insidious way in which academics are being used to monitor foreign students and staff
We are among the growing number of academics across the UK voicing our concern about being drawn into playing a key role in an ever-tightening system of immigration control. Many of us are now being asked to implement procedures and checks related to immigration status on both our colleagues and our students. The creeping imposition of such practices raises questions about the legal responsibilities and contractual requirements of university and college staff, the methods the UK is using to police immigration, and the compromising of what remains of academic freedom in Britain.
In February 2008, the Government introduced major changes to UK immigration policies and laws, seeking to consolidate a plethora of immigration-control measures. The main plank of these changes was the introduction of a points-based system (PBS) under which potential employers of migrant workers from outside the European Union must be approved and licensed by the Government before workers are granted permits to take up employment. Thus, universities and colleges must now be licensed as "approved education providers" to bring non-EU students into the UK to study. In addition, before they are admitted to the country, these students must hold a visa giving them permission to enter for the purposes of study at the approved institution, and prove that they have enough money to pay their fees and maintain themselves in the UK.
The Home Office has issued the same guidance to all higher education institutions, but universities differ markedly in the interpretation and implementation of their duties. Many have introduced a variety of new practices to monitor both the employment and education of non-EU nationals. Some academics and administrators are being instructed to take full registers at lectures and seminars, and to report non-attendance (even if attendance is not compulsory); others are being asked to take the passport information or driving licence details of colleagues who are invited to act as external examiners.
What is common to these responses is that they are discriminatory and likely to result in at best prejudicial and at worst unlawful actions against individual colleagues and students. Across the sector, management responses are confused and overzealous. The atmosphere for non-EU students and colleagues is becoming increasingly hostile and surrounded with doubt and suspicion.
Our role does not extend to policing or monitoring immigration - nor should it. It is important that academics resist collusion with the creeping surveillance mentality being introduced into institutions on the back of the PBS. The only reason for monitoring student activity or achievement should be to inform best pedagogic, pastoral and ethical practices.
And such surveillance, while a breach of trust and a distortion of our mentoring and pastoral roles, is just the thin end of the wedge. Some universities have been visited by "anti-terrorism" police and asked to report (Muslim) students whose work shows signs of "radicalisation". What next? Reporting anyone who shows signs of radicalism? All of this flies in the face of the better traditions of academic life, the educational process and the ethics of ensuring that no one is discriminated against in the classroom or the lecture hall. We urge, along with Susan Edwards ("Call off the witch-hunts", 30 April), tolerance and free debate in university life.
For all these reasons, we refuse to collude with attempts by Government and higher education institutions to use academics to police and monitor immigration controls. But what, concretely, does this refusal mean? There are some things that individuals can do. Take, for example, external examining, that (largely unpaid) system of collegiate goodwill upon which all of our undergraduate and postgraduate assessment rests; increasingly, those of us undertaking such work are being asked to provide evidence of citizenship (and by implication residency) - so a refusal to engage in any such process would quickly pose problems for those making the demands.
But we cannot leave it to individuals to take isolated action. As we write, a campaign is developing from the ground up through the University and College Union, and should result in a debate on motions of non-cooperation at the UCU's national congress at the end of May. We must also join with other unions across the sector, notably those that represent administrative staff. Among those things worth defending across universities and colleges, relationships based upon mutual trust and tolerance are surely of the highest priority.
Ann Singleton is senior research fellow, School for Policy Studies, University of Bristol; Steve Tombs is professor of sociology, Liverpool John Moores University; and David Whyte is reader in sociology, University of Liverpool.
Postscript :
Full list of signatories:
Rachel Aldred, University of East London
Nicole Asquith, University of Bradford
Andrea Beckmann, University of Lincoln
Eileen Berrington, Manchester Metropolitan University
Ben Bowling, Kings College London
Jon Burnett, University of Liverpool
Hazel Cameron, University of Liverpool
Elizabeth Capewell, Centre for Action Research in Professional Practice
Sarah Cemlyn, University of Bristol
Paul Chatterton, University of Leeds
Bankole Cole, University of Hull
Charlie Cooper, University of Hull
Gary Craig, University of Hull
Heaven Crawley, Swansea University
Erika Cudworth, University of East London
Bill Dixon, Keele University
Iain Ferguson, University of Stirling
Robert Fine, University of Warwick
Steven French, University of Leeds
Diane Frost, University of Liverpool
Geetanjali Gangoli, University of Bristol
Barry Goldson, University of Liverpool
Dave Gordon, University of Bristol
Penny Green, Kings College London
Simon Hallsworth, London Metropolitan University
Mark Hayes, Southampton Solent University
Stuart Hodkinson, University of Leeds
Gerry Johnstone, University of Hull
Helen Jones, Manchester Metropolitan University
Paul Jones, University of Liverpool
Majella Kilkey, University of Hull
Dave King, University of Liverpool
Joan Langan, University of Bristol
Ana Lopes, University of East London
Diana Medlicott, Buckinghamshire Chilterns University College
Lucy Michael, University of Hull
David Miller, University of Strathclyde
Linda Moore, University of Ulster
Lydia Morris, University of Essex
Bill Munro, University of Stirling
Gabe Mythen, University of Liverpool
Gbenga Oduntan, University of Kent
Christina Pantazis, University of Bristol
Stephanie Petrie, University of Liverpool
Scott Poynting, Manchester Metropolitan University
Anandi Ramamurthy, University of Central Lancashire
Vincenzo Ruggiero, Middlesex University
Jill Rutter, Migration team, Institute for Public Policy Research
David Scott, University of Central Lancashire
Phil Scraton, Queens University Belfast
Prakash Shah, Queen Mary, University of London
Joe Sim, Liverpool John Moores University
Ann Singleton, University of Bristol
Graham Smith, University of Manchester
Iyiola Solanke, University of East Anglia
Keith Soothill, Lancaster University
Steve Tombs, Liverpool John Moores University
Dermot Walsh, University of Limerick
Reece Walters, The Open University
John Watson, University of Hull
David Whyte, University of Liverpool
Richard Wild, University of Greenwich
Mick Wilkinson, University of Hull
Stuart Wilks-Heeg, University of Liverpool
Derek Williams, Southampton Solent University
Emma Williamson, University of Bristol
Majid Yar, University of Hull
Nira Yuval-Davis, University of East London

Fighting secrecy in court

2009-06-16T03:06:00.000-07:00

A judgment condemning the use of special advocates in imposing control orders is another blow to an unfair system
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Afua Hirsch
guardian.co.uk, Wednesday 10 June 2009 12.30 BST
Article history
Welcome to a new phase in the battle over counter-terrorism laws between parliament and the courts. Today's unanimous condemnation of the use of special advocates in imposing control orders by the House of Lords came as quite a surprise – overturning previous decisions upholding the system by the high court and the court of appeal.
There have been judicial blows to this system in the past; including a House of Lords decision in October 2007 which ruled that the special advocate system did not provide sufficient safeguards. But the law lords disagreed wildly on the extent to which the "controlee", as those under control orders are known, should be provided with the case against him, and left the overall system of control orders in place.
But today's judgment is a more fundamental blow. The House of Lords – in a powerful panel of nine judges – has decided that the system of secret advocates violates the right to a fair trial unless the controlee has access to at least the irreducible minimum of the case against them.
The current system of secret advocates has not allowed this. There are 100 or so special advocates currently accredited to act in secret proceedings although ironically, as a Justice report (pdf) released today points out, even in creating a system dealing with such sensitive information the government has not managed to gather its own intelligence on the exact number of lawyers appointed.
Special advocates operate according to a strict regime. As one told me, signing up involved rigorous security checks including interviews with friends and neighbours, requiring him to keep a safe in his office where all the papers are locked and providing him with secure transport whenever he needed to travel with them.
Some special advocates have expressed unease with operating in a system so antithetical to the usual ethics of legal representation – communicating key evidence with your client and taking their instructions is a fundamental part of what most advocates do.
Ian Macdonald QC, a renowned human rights barrister and one of the first special advocates to be appointed after the system was introduced for the first time in 1997, resigned in 2004 stating publicly that "whatever difference I might make as a special advocate on the inside is outweighed by the operation of a law, fundamentally flawed and contrary to our deepest notions of justice".
My role has been altered to provide a false legitimacy to indefinite detention without knowledge of the accusations being made and without any kind of criminal charge or trial. Such a law is an odious blot on our legal landscape and for reasons of conscience I feel that I must resign.
Today the law lords appear to be in agreement with the gist of this argument – criminal proceedings that deny the accused the right to know the case against them go against the grain of hundreds of years of carefully developed legal principles of which the British legal system has, ironically, been a proud exporter to countries around the world.
The erosion of openness in legal proceedings has not been confined to criminal trials or deportation either. Lawyers have been speaking for some time of the "creep" of secrecy throughout the legal system, including Louise Christian, who has been particularly vocal in warning of the use of closed evidence in employment tribunals and inquests.
Speaking at the Guardian Hay festival last month in a debate on civil liberties, former home secretary Charles Clarke – not widely known for his excessive liberalism – added his voice to the growing disquiet, acknowledging that the spread of secrecy needed to be scaled back.
The government was maintaining its official line today, however, stating that the system of special advocates was necessary to "manage the threat presented by terrorism".
"Protecting the public is my top priority and this judgment makes that task harder," home secretary Alan Johnson said this morning.
But given that cabinet members have been privately expressing their own unease at the continuation of counter-terrorism measures which were always intended to be temporary, including Jack Straw who spoke publicly about this to the Guardian last month, there is a subtext to today's judgment which is coming over loud and clear.
As the home secretary also said in his statement today "we take our obligations to human rights seriously". Of course the government is anxious to protect the public from any genuine security threat – no one, least of all the courts, would disagree with the importance of this. The government knows the system of control orders and special advocates is a deeply unfair way to respond to that threat and, reading between the lines, it looks like it simply has not come up with a Plan B.

The recession is far from over

2009-06-16T03:05:00.002-07:00

Economists and bankers are now putting positive spin on a supposed end to the economic crisis. Let's look at the real figures
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Ann Pettifor
guardian.co.uk, Friday 12 June 2009 08.30 BST
Article history
A banker, Alan Clarke of BNP Paribas, citing a NIESR report, confidently tells the Guardian that the recession is over. Should we take the word of any banker – especially one that claims to be an economist – seriously? Given that the economics profession was blind-sided by the "debtonation" (August 9 2007), I am deeply sceptical. Second, given that this is a banker-induced recession, that reckless and often fraudulent behaviour by bankers led to a loss of $60tn of yours and my wealth (in the form of pensions, equities, lost interest on savings, and lost income from job losses) last year, should we believe a banker's particular spin on the crisis?
I say firmly, no, for a number of reasons, outlined below. But the most important reason for pessimism, in my view, is the hegemonic role played by fiscal conservatives. By raising fears over government deficits, and by refusing to acknowledge that government spending pays for itself, these conservatives have set the economic and political agenda in all the British media, and in every British political party (with the Green party the honourable exception). As a result, Alistair Darling seems hell-bent on committing electoral suicide, with shadow chancellor George Osborne actively encouraging him. The private sector will not be able to rely on the public sector for the stimulus vital to recovery. As things stand, any fragile signs of economic recovery will quickly be crushed by the failure of government to intervene and spend at an appropriate level. Instead, government cutbacks will impact with considerable force on the fragile economy, and will hurt the middle and working classes. As the year proceeds many will discover the true, and often pitiful value of their pensions, and will be hurt by cuts in services and job losses in the public sector. This will hamper recovery and deepen, if that is possible, the alienation of British voters from the Labour government.
Unfortunately, the hegemony of fiscal conservatives reaches far and wide, and includes Germany's chancellor, Angela Merkel, President Sarkozy of France and the US's Federal Reserve governor, Ben Bernanke.
So, at a time of grave private economic failure, cuts in government spending in Europe and the US will arrest recovery. Furthermore, central bankers will have no room for manoeuvre to lower rates further, as they have done this year. Instead, interest rates may well rise at a time when low rates are needed to reflate the deflating body of the global economy.
So, while it must be accepted that the economy seems to have slowed its freefall into the abyss and that there are now fewer jobs to lose and fewer businesses to go bust – there is no real cause for confidence in sustained, or even halting recovery. The real economic outlook remains grim.
All G7 economies will report negative growth in 2009 for the first time in 100 years, according to the Economist Intelligence Unit's senior vice-president, Dr Daniel Thorniley, in a report to the EIU's corporate network. Darling, along with the British prime minister, Gordon Brown, constantly assure us that the "bankers' recession" was not made in Britain, but is a global phenomenon. By this reasoning negative growth in the G7 economies means little chance of recovery for the UK economy.
Foreign direct investment could fall globally by 45% this year, according to the same report, and corporate profits will decline by 20-25%. Global trade is down 25%, and the EIU predicts trade will be down by 10-15% by year end – the worst figure since 1945.
In April this year, consumer prices turned negative in the US, the UK, Germany and Japan. This may be good news for consumers, and may help lower food prices for the poor, but it is not good for the economy as a whole. Businesses cannot profit from negative prices, so they are bankrupted and lay off employees. The rocketing numbers of unemployed (whose plight is seldom taken seriously by orthodox economists) will cut back on borrowing and shopping and may even default on loans. This is not good news for the productive sector of the economy, and it's very bad news for the banking sector. Banks have still not fully de-leveraged the debts on their balance sheets. Now, thanks to rising unemployment, non-performing loans are "set to rise sharply around the world over the next 12-18 months" according to the EIU. This is very scary, if one considers that there are still $600tn of liabilities in the form of derivatives on balance sheets out there – backed up by a mere $38tn of so-called credit default swaps (in reality a form of insurance on derivatives).
Finally, the rising price of oil seems set to exacerbate this dismal economic outlook. To everyone's surprise, it has been rising lately and is now at $71. This is strange, because as Business Week's Stanley Reed reports, "stockpiles are so high that an ocean of oil is building up around the world in tankers or in depots". Yet the price of US crude has almost doubled. While Opec has cut back and maintained quotas of production, and contributed substantially to the price rise, it turns out that once again, the finance sector is playing fast and loose in oil markets. Göran Trapp, head of global oil trading at Morgan Stanley in London is quoted as saying: "Hedge funds and asset managers who have been sitting on cash now feel it's time to buy [oil]." $3.8bn has flowed into oil and gas exchange traded funds this year, versus $1.4bn in the first half of 2008.
The US and British governments appear relaxed, even passive, about the impact of hedge-fund speculation on the oil price and the global economy. Indeed they seem determined to maintain the dominant status of the finance sector within the economy. Banks that are "too big to fail" are not just tolerated, but encouraged in their morally hazardous behaviour. In Britain, the Labour government has actively helped consolidate the banking sector, and shrink the competition, as the forced Lloyds/HBOS merger demonstrated. Hedge funds remain free to gamble in the casino that is the global economy.
Nothing has been done to restructure the global economy and limit financial imbalances – including Anglo-American deficits and the Chinese surplus. Indeed these matters were not even discussed at the last G20 summit. Big, reckless money continues to be made from currency speculation, just when the global economy requires currency stability.
We – employees, consumers, investors and borrowers – have been misled and fooled by the economics profession and finance sector for years before this crisis. As a result of our gullibility, we lost $60tn of wealth in the past year. We would be wise now to dismiss their vain efforts at confidence-boosting, and instead rest our judgments on the real world economic outlook.

SOAS occupation: chaos the better virtue

2009-06-16T03:05:00.001-07:00

Just got back from SOAS where around thirty people are occupying the director's office in support of those cleaners who were arrested by immigration police on Friday.

The cleaners, who work for private company ISS, were called into a dawn meeting by management on Friday morning. The police, who were laying in wait for them, swooped out and seized nine cleaners - my understanding is that six have now been deported and three others are under threat of deportation, including a woman who is six month's pregnant and a sick woman in her sixties who had a heart attack whilst in custody.The company who is in a struggle to break the union had previously sacked the grassroots trade unionist Stalin Bermudez who had been waging a very effective campaign for a decent living wage for cleaners at SOAS and elsewhere. This move is clearly part of finishing the union off by deporting trouble makers and cowing the others.Immigration controls are often used to divide and rule with migrant workers being among the most vulnerable and most poorly paid. The answer is not to demand British Jobs for British Workers but to throw an arm around migrant workers and ensure they get paid the same, are welcomed into the unions and that any attempt to use immigration laws against trade unionists is resisted tooth and nail.The management was clearly complicit in the arrests at best and helped organise them at worst. The university was informed that the police were coming and they gave permission for the raid to take place and, to some unknown extent, assisted in the ambush that had been laid for their staff.The demonstration that was called for this morning heard from various excellent speakers one of whom compared these cleaners to the tolpuddle martyrs. Of course the comparison is not exactly direct - after all the martyrs were given a trial before they were deported.At this point the SOAS workers attending the demo announced they were to hold a union meeting and someone else suggested we put our demands to the management direct, so around thirty to forty of us marched up to the director's office and had a bit of a business meeting with him.We discussed his role in the arrests, his support for farming out cleaning to a private company, what he could have done to prevent the arrests and what he was willing to do to repair the damage that had been done. It was an emotional meeting on both sides, the director was clearly unhappy with having his office occupied and a bunch of plebs talking to him like an equal and we were unhappy that trade unionists had been deported to Latin American countries including Colombia.We also put it to him that Stalin Bermudez should be reinstated. He disagreed. Read the full list of demands here.Now I have a confession. Even as we marched into office I was thinking 'oh, I really need the loo' and eventually I couldn't take it anymore and nipped out to get some relief. It's not the most heroic episode of the day I grant you but wetting myself might have been misinterpreted and certainly a little anti-social for those who'd have to share a cramped space with me so I think it was for the best.By the time I came back the door was locked and there was a guard posted there not allowing anyone back into the occupied zone. It was all non-violent direct action so it just wouldn't have been appropriate to karate chop the guard down and kick open the door, although if Hollywood ever make a big screen version they might like to write that bit in.Instead I hung about outside the door and told people who were thinking of leaving that they wouldn't be able to get back in, which meant a couple of people didn't come a cropper at least. Eventually the occupation asked the director to leave as they had things to be getting on with and after a bit of toing and froing that's what happened.Banners were hung up out the windows and it looked like the occupation was settling down nicely for the duration by the time I left. The fact of the matter is these are serious issues and time is very short indeed. When management collude with the police to victimise migrant workers we don't have the time to observe certain niceties as in some cases this is literally life and death.At one point the director objected to the idea that he should not have assisted the immigration police because it would have "caused chaos". One woman replied from the crowd said "In this case chaos would have been the better virtue" and I could not agree more.The anarchic nature of the forcible meeting with the director (where one woman suggested to the director's face that the French had a good idea when they kidnapped their bosses) and the occupation were at times a little, cough, ad hoc, but where it occasionally lacked sharpness this was more than made up for in energy and direction of purpose.If we are to gain justice for migrant workers we have to act. SOAS management have it within their power to protect their workforce from victimisation, sadly it does not seem that this is something to which they will willingly agree.

A new politics: A citizens' convention

2009-06-08T03:04:00.002-07:00

Trust in our politicians has collapsed. How can it be restored? Public confidence cannot even begin to return this side of a general election. The public rightly want the opportunity to hold this parliament to account for its actions. We also need to clean up the system of expenses and ensure that MPs' pay and allowances are set and audited by an independent body.
But restoring trust will also require wider reform. Everyone has their favourite proposition for reforming our dysfunctional political system. Many of these measures, such as electoral reform, are desirable for a number of reasons, though their connection to the current controversy is not obvious. Whatever the merits of individual measures, the most important condition for any process of political renewal is that it must be led by the public itself.
There is currently a mismatch between the conversations politicians are having – about the pros and cons of different reform measures – and the wider public conversation, which is almost exclusively about expenses. The reformists are right to claim that measures such as electoral reform are essential to the renewal of our political system, but the wider public is largely absent from that debate.
The government is to set up a national council for democratic renewal, made up of ministers and constitutional experts. But voters do not want a reform programme that has been foisted on them by a class of politicians who have lost their political authority. Instead, a citizens' convention should be established, tasked with reviewing the political system. The convention would be made up of 150-200 ordinary citizens, selected by lot like a jury. It would take evidence at "town hall" meetings around the country and would recommend a number of options for reform. These could be voted on by parliament or by the public in a referendum.
If trust is to be regained, we need to take the constitutional reform debate out of the Westminster village and ask the British people what kind of politics they want.

14 years after Ken Saro-Wiwa's death, family points finger at Shell in court

2009-06-08T03:04:00.001-07:00

In 1995, at a trial that resulted in his conviction and execution, the Nigerian writer and environmental activist Ken Saro-Wiwa vowed that the oil giant Shell would one day be brought to justice.
That day is looming large as a New York court prepares for a trial in which the oil giant Shell stands accused of crimes against humanity over its activities in the oil-rich Niger Delta of southern Nigeria.
Today, a last minute delay to the trial postponed the jury selection until next week. But when it does start, the trial will excite huge interest on the part of multinational companies and human rights bodies, because the outcome could have a bearing on the issue of corporate accountability and how far it extends.
Saro-Wiwa made his prediction days before he and eight other leaders of the Ogoni people were hanged by the Nigerian military regime in November 1995.
In a final statement at his own trial, which he was prevented from delivering, Saro-Wiwa said of Shell that "its day will surely come. The crime of the company's dirty wars against the Ogoni people will be punished."
When the trial does begin, relatives of the Ogoni nine, as the executed leaders are known, will be present in court as plaintiffs in the civil lawsuit against the firm. They and the other plaintiffs allege that Shell was an active participant in atrocities and abuses carried out by Nigeria's military police.
In addition to the alleged murder of the Ogoni nine, they also hold Shell partially responsible for torture, illegal detention, forced exile and shootings of hundreds of Ogoni protesters during the 1990s.
Shell has strongly denied the charges. In a statement to the Guardian, a Royal Dutch Shell spokesman in the Netherlands said the 1995 executions were tragic events that the company tried to prevent through appeals for clemency to the Nigerian government of the time.
"To our deep regret, that appeal went unheard, and we were shocked and saddened when we heard the news. Shell in no way encouraged or advocated any act of violence against them or their fellow Ogonis," said the statement.
The dispute between Shell and the Ogoni protesters stems from the company's extensive interests in the Niger delta stretching back to 1958. It now owns about 90 oil fields across the country.
From the early 1990s, non-violent protests began among Ogonis unhappy about the impact of oil exploration, which they said was destroying the environment that they depended on for fishing or farming.
Clearance work to make way for pipelines was decimating the world's third-largest mangrove forest. Oil spills were rife, polluting the land at a rate, campaigners said, equivalent to an Exxon Valdez oil disaster every year. Oil flares only made the pollution worse.
In 1990 Saro-Wiwa, a well-known journalist and activist, helped found the Movement for the Survival of the Ogoni People, bringing its case against Shell's destruction of the environment to an international audience. A peaceful protest in 1993 mobilised 300,000 Ogonis.
A year later the Ogoni nine were arrested on what were widely regarded to have been trumped-up charges. The men were tortured, beaten and then put on trial in front of a tribunal without legal representation. They were sentenced to death.
The civil action is slated for a federal US court under an obscure 1789 law that initially applied to piracy. In 2004 the supreme court ruled that it could be used by foreign parties to bring cases against defendants – including multinational corporations – in specific areas, notably torture and crimes against humanity.
So far very few cases have been brought to trial under the act, and none have proved successful for plaintiffs. But Jennie Green of the New York-based Centre for Constitutional Rights, which filed the case, said that human rights cases against corporations were still so new that no pattern had yet been established.
"Juries decide on the facts and we think we have a strong case that will convince them to hold Shell accountable for what they did. They were involved in human rights violations, participating, aiding and abetting," she said.
If it does go to trial, the case is expected to last up to a month, with Shell calling 11 witnesses and the Ogoni campaigners presenting up to 20. Among the latter will be Ken Saro-Wiwa Jr, the son of the executed leader, who will be pressing for compensation for his father's death.
For him, the case is not just an attempt to complete his father's search for justice. "It's the final stage for me," Saro-Wiwa Jr said. "In a sense I've lost the past 12 years of my life."
The other witnesses include the executed leader's brother, Owens Wiwa. He will allege that Brian Anderson, the then head of Shell's Nigerian subsidiary who is named as a defendant in the lawsuit, offered him a deal ensuring Saro-Wiwa would be released on condition that the Ogoni protests were called off.
The jury will be presented with evidence that the subsidiary told its parent company that Saro-Wiwa would be convicted and that he would never go free. They will also hear that two key witnesses at the trial that led to the hangings of the Ogoni nine later recanted, saying they had been bribed to give false testimony with offers of Shell jobs.
Karalolo Kogbara will also give evidence. She lost her crops when Shell bulldozed her village in 1993 to make way for a pipeline. When the villagers protested, Shell allegedly called for Nigerian troops, who shot her, causing her to lose an arm.
The company has yet to divulge its detailed defence, but it will be contesting every count on the grounds that the violence committed against the Ogoni was wholly caused by the Nigerian government and had nothing to do with its commercial operations.
The plaintiffs have not given any indication of the compensatory and punitive damages they are seeking, preferring to leave the matter, should they win, up to the jury. But such is the extreme nature of the charges that any award could possibly run into many millions of dollars.
Stephen Kretzmann, director of Oil Change International, who worked with Saro-Wiwa before his death, said the trial came too late for the Ogoni nine. But, whatever the outcome, he believes it will "send a message to multinationals that they have to obey local and international laws on human rights".
Saro-Wiwa Jr said he hoped that the jury would see that the oil giant's "fingerprints are all over this". He added: "For a long time Shell was able to operate with impunity hiding behind a military regime. Now it's time they were held to account."

Now at last it's time for Shell to atone for my father's death

2009-06-08T03:02:00.000-07:00

The son of the executed activist faces the oil giant in a human rights trial this week. He seeks understanding rather than retribution
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Ken Saro-Wiwa Jnr
The Observer, Sunday 24 May 2009
Article history
This week, a US court will hear a case that I and nine other plaintiffs filed against Royal Dutch Shell for its part in human rights violations committed against some Ogoni families and individuals in Nigeria in 1995. For some, the case is already being cast as a bookmark in the struggle for corporate accountability, but to me and the other nine plaintiffs it is all that and more.
Fourteen years ago, Ken Saro-Wiwa predicted that Shell would one day have to account for its actions in Nigeria. "I repeat," he wrote in what would have been his final statement to the military tribunal that was to order his execution, "that I and my colleagues are not the only ones on trial. Shell is here on trial... the company has, indeed, ducked this particular trial, but its day will surely come ... there is no doubt in my mind that the ecological war that the company has waged in the delta will be called to question sooner than later and the crimes of that war be duly punished. The crime of the company's dirty wars against the Ogoni people will also be punished."
My father was prevented from making his final statement to the court and he and eight of his colleagues were tried and executed for their alleged role in the harrowing murders of four Ogoni chiefs including his brother-in-law. The murders divided my family and set Ogoni against Ogoni, providing a convenient excuse for the military regime to arrest my father, detain and torture scores of innocent men and send in a military taskforce whose leader publicly vowed to "sanitise" Ogoni so that Shell could drill oil in my community.
Ken Saro-Wiwa's real "crime" was his audacity to sensitise local and global public opinion to the ecological and human rights abuses perpetrated by Shell and a ruthless military dictatorship against the Ogoni people. The success of his campaign had mobilised our community to say "No to Shell" and to demand compensation for years of oil spills that had polluted our farms, streams and water sources. My father called the world's attention to the gas flares that had been pumping toxic fumes into the Earth's atmosphere for up to 24 hours a day since oil was discovered on our lands in 1958. He accused Shell of double standards, of racism and asked why a company that was rightly proud of its efforts to preserve the environment in the west would deny the Ogoni the same.
In response to his campaign, Shell armed, financed and otherwise colluded with the Nigerian military regime to repress the non-violent movement, leading to the torture and shootings of Ogoni people as well as massive raids and the destruction of Ogoni villages. In an infamous memo, Colonel Paul Okuntimo, the head of the military taskforce sent to pacify Ogoni, boasted that Shell provided the logistics for his soldiers. In one incident, Shell was building an oil pipeline and requested support from the Nigerian military. The pipeline destroyed Karalolo Kogbara's farm and, as she was crying over her lost crops, the soldiers shot her. In another incident, Uebari N-nah was shot and killed by soldiers near a Shell flow station; the soldiers were requested by and later compensated by Shell.
A year after the executions, some of the relatives of what has become known as the "Ogoni Nine" filed a federal lawsuit against Shell in a district court in New York. We felt we would not get a fair hearing in a Nigeria groaning under the very same military dictatorship that had colluded with Shell to violate the human rights of our relatives and our community.
In response Shell, which denied that it encouraged violence against Ken Saro-Wiwa, or other Ogonis, and said it attempted to persuade the Nigerian government to grant clemency to the Ogoni 9, hired the most expensive legal minds to prevent us from holding them to account for their actions in the US. Their filibustering brought 13 years of time, four spent arguing over where they should stand trial.
No doubt Shell will try to present themselves as the victims, whose only interest was to produce hydrocarbons in a "challenging" business environment. But can you be so sure of Shell? This, after all, is a company that, as revealed in an investigation by this paper in January 1996, lied about importing arms to Nigeria. And even its own consultants concluded in a 2003 report that its community development schemes were fanning the flames of conflict in the Niger Delta. Shell declined to publish the results. Moreover, this is a corporation that was widely reported to have misled investors and shareholders in 2004 about the size of its reserves in places like Nigeria.
For that financial violation, the New York stock exchange moved quickly to protect the rights of shareholders and investors and Shell was fined $100m. It took less than two years to hold a multinational corporation to account in a US court for financial violations in a foreign jurisdiction.
And yet it has taken 14 years to bring a case to trial against the same multinational corporation in a US court for human rights violations.
All over the globe, people are becoming better informed about the global economy. People are joining the dots that connect the oil under their farms to the extravagant lifestyles in the west. You can make these connections via cable television in my village even thought there is no pipe-borne water and the electricity mostly comes from a diesel generator. There is increasing awareness of the connections between irreversible climate change and our thirst for fossil fuels. More and more people are now feeling the effects of unregulated corporations.
My father was not against oil exploration and production. He appreciated many of the benefits of capitalism, valued the "can-do" spirit, the innovation and would never deny the right of anyone to seek adequate reward and fulfilment from their risk and sweat equity. But can we continue to put profits before people and the planet? How do we monitor institutions and organisations that have the capacity to operate and organise themselves beyond the regulation and jurisdiction of the current regimes of global governance?
Ken Saro-Wiwa always maintained that Shell would eventually come to see him as their greatest friend. He believed that the day would come when Shell would understand that its social licence to operate is as valuable as its commercial rights. In a competitive and uncertain world where the price of doing business becomes ever more unpredictable, where more players - Russians, Indians and Chinese - are able to compete for drilling rights, it will become ever more important to win the battle for local hearts and minds to advocate for a world run on mutual benefit rather than exploitation.
For the relatives, the trial remains our last opportunity to close this sad chapter in our lives. For 12 years, we have all separately developed strategies to survive, living with the anger and the rage that one's relative was unjustly murdered and that many of the institutions and individuals who were responsible for human rights violations continued not only to get away with murder but also to profit from their crimes.
We have remained dignified while the world has moved on. Few have ever wondered about the emotional or financial welfare of the victims but real lives, real people were destroyed.
In the face of the provocations and psychological trauma of all this, I have tried to maintain a dignified position, worked assiduously to deny myself the right to grieve in order to find a lasting solution to the challenges of the Ogoni and the Niger Delta in Nigeria.
The day after my father was hanged, I was asked my opinion of Shell and I didn't hesitate to answer that Shell was part of the problem and must be part of the solution.
I haven't changed my opinion. I am not interested in retributive justice but a justice that is creative, a justice that enables all stakeholders in this affair to account for and learn lessons from the past so that we can all move forward within a constructive and sustainable framework. We have to remain committed to building the kind of world that ensures that people who live on natural resource-bearing areas are not treated as collateral damage in a senseless race for profit.
With all of its experience in Nigeria, Shell knows that such creative justice is possible and the time for us to move in that direction is at hand.

Goodbye, GM

2009-06-08T03:01:00.000-07:00

by Michael Moore
June 1, 2009
I write this on the morning of the end of the once-mighty General Motors. By high noon, the President of the United States will have made it official: General Motors, as we know it, has been totaled.
As I sit here in GM's birthplace, Flint, Michigan, I am surrounded by friends and family who are filled with anxiety about what will happen to them and to the town. Forty percent of the homes and businesses in the city have been abandoned. Imagine what it would be like if you lived in a city where almost every other house is empty. What would be your state of mind?
It is with sad irony that the company which invented "planned obsolescence" -- the decision to build cars that would fall apart after a few years so that the customer would then have to buy a new one -- has now made itself obsolete. It refused to build automobiles that the public wanted, cars that got great gas mileage, were as safe as they could be, and were exceedingly comfortable to drive. Oh -- and that wouldn't start falling apart after two years. GM stubbornly fought environmental and safety regulations. Its executives arrogantly ignored the "inferior" Japanese and German cars, cars which would become the gold standard for automobile buyers. And it was hell-bent on punishing its unionized workforce, lopping off thousands of workers for no good reason other than to "improve" the short-term bottom line of the corporation. Beginning in the 1980s, when GM was posting record profits, it moved countless jobs to Mexico and elsewhere, thus destroying the lives of tens of thousands of hard-working Americans. The glaring stupidity of this policy was that, when they eliminated the income of so many middle class families, who did they think was going to be able to afford to buy their cars? History will record this blunder in the same way it now writes about the French building the Maginot Line or how the Romans cluelessly poisoned their own water system with lethal lead in its pipes.
So here we are at the deathbed of General Motors. The company's body not yet cold, and I find myself filled with -- dare I say it -- joy. It is not the joy of revenge against a corporation that ruined my hometown and brought misery, divorce, alcoholism, homelessness, physical and mental debilitation, and drug addiction to the people I grew up with. Nor do I, obviously, claim any joy in knowing that 21,000 more GM workers will be told that they, too, are without a job.
But you and I and the rest of America now own a car company! I know, I know -- who on earth wants to run a car company? Who among us wants $50 billion of our tax dollars thrown down the rat hole of still trying to save GM? Let's be clear about this: The only way to save GM is to kill GM. Saving our precious industrial infrastructure, though, is another matter and must be a top priority. If we allow the shutting down and tearing down of our auto plants, we will sorely wish we still had them when we realize that those factories could have built the alternative energy systems we now desperately need. And when we realize that the best way to transport ourselves is on light rail and bullet trains and cleaner buses, how will we do this if we've allowed our industrial capacity and its skilled workforce to disappear?
Thus, as GM is "reorganized" by the federal government and the bankruptcy court, here is the plan I am asking President Obama to implement for the good of the workers, the GM communities, and the nation as a whole. Twenty years ago when I made "Roger & Me," I tried to warn people about what was ahead for General Motors. Had the power structure and the punditocracy listened, maybe much of this could have been avoided. Based on my track record, I request an honest and sincere consideration of the following suggestions:
1. Just as President Roosevelt did after the attack on Pearl Harbor, the President must tell the nation that we are at war and we must immediately convert our auto factories to factories that build mass transit vehicles and alternative energy devices. Within months in Flint in 1942, GM halted all car production and immediately used the assembly lines to build planes, tanks and machine guns. The conversion took no time at all. Everyone pitched in. The fascists were defeated.
We are now in a different kind of war -- a war that we have conducted against the ecosystem and has been conducted by our very own corporate leaders. This current war has two fronts. One is headquartered in Detroit. The products built in the factories of GM, Ford and Chrysler are some of the greatest weapons of mass destruction responsible for global warming and the melting of our polar icecaps. The things we call "cars" may have been fun to drive, but they are like a million daggers into the heart of Mother Nature. To continue to build them would only lead to the ruin of our species and much of the planet.
The other front in this war is being waged by the oil companies against you and me. They are committed to fleecing us whenever they can, and they have been reckless stewards of the finite amount of oil that is located under the surface of the earth. They know they are sucking it bone dry. And like the lumber tycoons of the early 20th century who didn't give a damn about future generations as they tore down every forest they could get their hands on, these oil barons are not telling the public what they know to be true -- that there are only a few more decades of useable oil on this planet. And as the end days of oil approach us, get ready for some very desperate people willing to kill and be killed just to get their hands on a gallon can of gasoline.
President Obama, now that he has taken control of GM, needs to convert the factories to new and needed uses immediately.
2. Don't put another $30 billion into the coffers of GM to build cars. Instead, use that money to keep the current workforce -- and most of those who have been laid off -- employed so that they can build the new modes of 21st century transportation. Let them start the conversion work now.
3. Announce that we will have bullet trains criss-crossing this country in the next five years. Japan is celebrating the 45th anniversary of its first bullet train this year. Now they have dozens of them. Average speed: 165 mph. Average time a train is late: under 30 seconds. They have had these high speed trains for nearly five decades -- and we don't even have one! The fact that the technology already exists for us to go from New York to L.A. in 17 hours by train, and that we haven't used it, is criminal. Let's hire the unemployed to build the new high speed lines all over the country. Chicago to Detroit in less than two hours. Miami to DC in under 7 hours. Denver to Dallas in five and a half. This can be done and done now.
4. Initiate a program to put light rail mass transit lines in all our large and medium-sized cities. Build those trains in the GM factories. And hire local people everywhere to install and run this system.
5. For people in rural areas not served by the train lines, have the GM plants produce energy efficient clean buses.
6. For the time being, have some factories build hybrid or all-electric cars (and batteries). It will take a few years for people to get used to the new ways to transport ourselves, so if we're going to have automobiles, let's have kinder, gentler ones. We can be building these next month (do not believe anyone who tells you it will take years to retool the factories -- that simply isn't true).
7. Transform some of the empty GM factories to facilities that build windmills, solar panels and other means of alternate forms of energy. We need tens of millions of solar panels right now. And there is an eager and skilled workforce who can build them.
8. Provide tax incentives for those who travel by hybrid car or bus or train. Also, credits for those who convert their home to alternative energy.
9. To help pay for this, impose a two-dollar tax on every gallon of gasoline. This will get people to switch to more energy saving cars or to use the new rail lines and rail cars the former autoworkers have built for them.
Well, that's a start. Please, please, please don't save GM so that a smaller version of it will simply do nothing more than build Chevys or Cadillacs. This is not a long-term solution. Don't throw bad money into a company whose tailpipe is malfunctioning, causing a strange odor to fill the car.
100 years ago this year, the founders of General Motors convinced the world to give up their horses and saddles and buggy whips to try a new form of transportation. Now it is time for us to say goodbye to the internal combustion engine. It seemed to serve us well for so long. We enjoyed the car hops at the A&W. We made out in the front -- and the back -- seat. We watched movies on large outdoor screens, went to the races at NASCAR tracks across the country, and saw the Pacific Ocean for the first time through the window down Hwy. 1. And now it's over. It's a new day and a new century. The President -- and the UAW -- must seize this moment and create a big batch of lemonade from this very sour and sad lemon.
Yesterday, the last surviving person from the Titanic disaster passed away. She escaped certain death that night and went on to live another 97 years.
So can we survive our own Titanic in all the Flint Michigans of this country. 60% of GM is ours. I think we can do a better job.
Yours,Michael MooreMMFlint@aol.com MichaelMoore.com

Global crisis 'hits human rights'

2009-06-08T03:00:00.002-07:00

The global economic crisis is exacerbating human rights abuses, Amnesty International has warned.
In its annual report, the group said the downturn had distracted attention from abuses and created new problems.
Rising prices meant millions were struggling to meet basic needs in Africa and Asia, it said, and protests were being met with repression.
Political conflict meant people were suffering in DR Congo, North Korea, Gaza and Darfur, among others, it said.
'Time-bomb'
The 400-page report, compiled in 157 countries, said that human rights were being relegated to the back seat in pursuit of global economic recovery.
See region by region
The world's poorest people were bearing the brunt of the economic downturn, Amnesty said, and millions of people were facing insecurity and indignity.
Migrant workers in China, indigenous groups in Latin America and those who struggled to meet basic needs in Africa had all been hit hard, it said.
AMNESTY REPORT
Amnesty International Report 2009: State of the World's Human Rights [6.95 MB]
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Where people had tried to protest, their actions had in many cases been met with repression and violence.
The group warned that rising poverty could lead to instability and mass violence.
"The underlying global economic crisis is an explosive human rights crisis: a combination of social, economic and political problems has created a time-bomb of human rights abuses," said Amnesty's Secretary General, Irene Khan.
The group is launching a new campaign called Demand Dignity aimed at tackling the marginalisation of millions through poverty.
World leaders should set an example and invest in human rights as purposefully as they invest in economic growth, Ms Khan said.
"Economic recovery will be neither sustainable nor equitable if governments fail to tackle abuses that drive and deepen poverty, or armed conflicts that generate new violations," she said.
See below for highlights of the report by region

AFRICA
Amnesty says the economic crisis has had a direct impact on human rights abuses on the continent.
"People came into the streets to protest against the high cost of living," Erwin van der Borght, Amnesty's Africa programme director, told the BBC's Network Africa programme.
FROM BBC WORLD SERVICE
More from BBC World Service
"The reaction we saw from the authorities was very repressive. For example, in Cameroon about 100 people were killed in February last year."
But the bulk of Amnesty's report concentrated on the continent's three main conflict zones: the Democratic Republic of Congo, Somalia and Sudan.
In DR Congo, the focus was on the east where it said civilians had suffered terribly at the hands of government soldiers and rebel groups. The Hutu FDLR movement, for example, was accused of raping women and burning people alive in their homes.
Amnesty said it was also the civilians in Somalia who bore the brunt of conflict, with tens of thousands fleeing violence and hundreds killed by ferocious fighting in the capital, Mogadishu. It also highlighted the killing and abduction of journalists and aid workers.
In Sudan, Amnesty catalogued a series of abuses including the sentencing to death of members of a rebel group, a clampdown on human rights activists and the expulsion of several aid groups following the issuing of an international arrest warrant against President Omar al-Bashir.
A number of countries, including Zimbabwe and Ethiopia, were criticised for intimidating and imprisoning members of the opposition.
And Nigeria came under fire for the forced evictions of thousands of people in the eastern city of Port Harcourt.
ASIA
Across the region, millions fell further into poverty as the cost of basic necessities rose, Amnesty said.
In Burma, the military government rejected international aid in the aftermath of Cyclone Nargis and punished those who tried to help victims of the disaster. It continued campaigns against minority groups which involved forced labour, torture and murder, Amnesty said.
In North Korea, millions are said to have experienced hunger not seen in a decade and thousands tried to flee, only to be caught and returned to detention, forced labour and torture. In both North Korea and Burma, freedom of expression was non-existent.
In China, the run-up to the Beijing Olympic Games was marred by a clamp-down on activists and journalists, and the forcible evictions of thousands from their homes, the report said. Ethnic minorities in Xinjiang and Tibet continued to suffer from systematic discrimination, witnessing unrest followed by government suppression.
Millions of Afghans faced persistent insecurity at the hands of Taliban militants. The Afghan government failed to maintain the rule of law or to provide basic services to many. Girls and women particularly suffered a lack of access to health and education services.
In Sri Lanka, the government prevented international aid workers or journalists from reaching the conflict zone to assist or witness the plight of those caught up in fighting between government troops and Tamil Tiger rebels.
MIDDLE EAST AND NORTH AFRICA
Israel's military operation in Gaza in December 2008 caused a disproportionate number of civilian casualties, Amnesty said. Its blockade of the territory "exacerbated an already dire humanitarian situation, health and sanitation problems, poverty and malnutrition for the 1.5 million residents", according to the report.
On the Palestinian side, both Hamas and the Palestinian Authority were accused of repressing dissent and detaining political opponents.
The death penalty was used extensively in Iran, Iraq, Yemen and Saudi Arabia. Across the region, women faced discrimination both under the law and in practice, Amnesty said, and many faced violence at the hands of spouses or male relatives.
Governments that included Algeria, Iraq, Lebanon, Syria and Yemen are said to have used often sweeping counter-terrorism laws to clamp down on their political opponents and to stifle legitimate criticism.
AMERICAS
Indigenous communities across Central and South America were disproportionately affected by poverty while their land rights are ignored, Amnesty said. Development projects on indigenous land were often accompanied by harassment and violence.
Women and girls faced violence and sexual abuse, particularly in Haiti and Nicaragua. The stigma associated with the abuse condemned many to silence, the report said, while laws in some nations meant that abortion was not available to those who became pregnant as a result of abuse or assault.
Gang violence worsened in some nations; in Guatemala and Brazil evidence emerged of police involvement in the killings of suspected criminals, the report found.
America continued to employ the death penalty, the report noted, and concern persisted over foreign nationals held at America's Guantanamo Bay detention centre, although the report acknowledged the commitment by US President Barack Obama to close it down.
EUROPE AND CENTRAL ASIA
Civilians paid a high price for last year's conflict between Russia and Georgia, Amnesty said. Hundreds of people died and 200,000 were displaced. In many cases, civilians' homes and lives were devastated.
Many nations continued to deny fair treatment to asylum seekers, with some deporting individuals or groups to countries where they faced the possibility of harm.
Roma (gypsies) faced systematic discrimination across the region and were largely excluded from public life in all countries.
Freedom of expression remained poor in countries such as Belarus, Uzbekistan, Turkmenistan and other Central Asian nations.

The real British expenses scandal seems to be immune to exposure

2009-06-08T03:00:00.001-07:00

For a moment, my heart leapt. The headline on the front of yesterday's Daily Mail contained the words travel, scandal, extortionate and £6.2. I imagined, until I read it properly, that it referred to the £6.2bn contract to expand the M25 motorway, which has just been signed. Some hope. "The £6.2m bill: scandal of how MPs are taking taxpayers for a ride with extortionate travel expenses" referred to a rip-off precisely 1,000th of the size of the travel expenses scandal that interests me.
I understand the public anger and fascination about MPs' expenses, and the burning question of whether you can obtain capital gains tax exemption on your second duck house. But it is microscopic compared with the corruption that has been bubbling along merrily for 15 years in the UK, unmolested by the tabloid press.
In April, the widening of four sections of the M25 was to have cost you and me £5bn. This was already a spectacular rip-off. The Campaign for Better Transport had calculated that the same amount of extra road space – if it were really needed – could have been created for £478m. But somehow, over the past four weeks, the £5bn for widening four sections of motorway has mutated into £6.2bn for widening two. In Sicily, officials agree to terms like this with the help of dainty gifts like horse's heads and waistcoats full of fish. In the UK, the government volunteers them without any obvious inducement.
There's nothing remarkable about this inflation: it appears to be an inherent property of the government's private finance initiative schemes. The PFI allows consortiums of banks, construction and service companies to build and run our public infrastructure. Though the government maintains that this offers better value than using public money, in reality the numbers behind all PFI projects are rigged. While the government retains much of the risk, the investors keep the profits, which often run to many times the value of the schemes.
The public liability incurred so far by the private finance initiative is £215bn. Much of this spending (half? three-quarters? – the deals are so complex and opaque that we will never know for sure) is pure pork fat. One day the repayments will destroy Britain's public finances. This extravagance makes our MPs look like ascetics.
But this waste will never feature on the front page of the Daily Mail – or any page at all. Though it purports to speak for the lower middle classes, the Mail serves the rentier class, which benefits from these deals. The issue is also so complex that it is hard to see how it could be conveyed in a tabloid story. You have only to write the words private finance initiative to lose 90% of your readers.
Across 12 years of researching this issue, I have kept running into the brick wall of public indifference. I have used every conceivable device to try to convey the scope and scale of this rip-off. None of them works. Like the academics Jean Shaoul and Allyson Pollock, the magazines Private Eye and Red Pepper, and the Sunday Telegraph's columnist Liam Halligan, all of whom have spent years exposing this scandal, I appear to have been wasting my time. The issue is too remote and too complex to ignite public indignation. The scheme's obscurity has protected it from the outrage now being directed towards MPs.
But just in case anyone is still reading, I'll try again. The terms offered by the new M25 scheme are so generous that an orang-utan in a suit and tie couldn't fail to clean up. The new price appears to represent the cost to the government of keeping the banks in the deal. The scheme is meant to be ready in time for the Olympics, but the companies involved have spun out the negotiations for so long – demanding ever more outrageous terms – that the government is now prepared to pay almost any price to get the road widened on time, regardless of future liabilities. The option of tackling the problem by reducing the volume of traffic – an orbital coach network is the most obvious solution – was never considered. When Alistair Darling was transport secretary, he was asked about this alternative in the Commons. He dismissed it out of hand.
One of the consistent features of PFI is that the projects are reverse-engineered to meet the demands of corporate investors. This, for example, is how the £30m public scheme to refurbish Coventry's two hospitals became a £410m private scheme to knock them both down and rebuild one of them – containing fewer beds and fewer doctors and nurses. The old scheme was too cheap to attract private money. Similarly, an orbital bus system offers only modest profits.
Last year, the Treasury promised to bring private finance deals on to the government's balance sheets, in order to meet international financial reporting standards. Most PFI schemes don't count as public debt, which is one of the reasons why the government finds them attractive. (The other is that this corporate welfare bought New Labour the support of business groups and sections of the rightwing press.) But on 13 May, at the height of the MPs' expenses scandal, the Treasury quietly reneged on this promise.
In opposition, when Labour opposed PFI, Darling complained that "apparent savings now could be countered by the formidable commitment on revenue expenditure in years to come". Now, as chancellor of the exchequer, he has decided to keep disguising this commitment from the public. Government departments will publish two sets of accounts: one that keeps PFI schemes on the books to meet international standards, another that keeps them off the books in order to conceal the extent of public liabilities. This is what Enron did: it produced different sets of accounts for different audiences.
The Treasury issued no press release to announce this change of policy, and refuses to send me its guidance to government departments, which explains how the new rules will work. The private finance initiative, like parliament, has been protected for years by secrecy and obfuscation.
We never could afford this extravagance, but to keep squandering money on PFI schemes today, when we know how much trouble government finances are in, is lunacy. Last week, the ratings agency Standard & Poor's warned that the UK's credit rating could be cut. No one in this government appears to care about the extra, unacknowledged debt it is loading on to future administrations through PFI. Because these schemes run for 25 or 30 years, their liabilities are someone else's problem.The health secretary, Alan Johnson, has just called for a "root and branch look at how our democracy works". Is the notion that this might include a reappraisal of the private finance initiative too much to hope for? Yes. There is no tabloid campaign against this corruption, nor will there ever be. The Conservatives, who invented PFI, have no interest in scrapping it. The real British expenses scandal appears to be immune to exposure.

Sonia Sotomayor's real-life experience

2009-06-08T02:59:00.000-07:00

Let's get this out of the way first: Sonia Sotomayor is not a perfect liberal judge. She is not astoundingly progressive or notably feminist. She isn't a tireless champion of civil rights or a first amendment absolutist. She is, however, a highly intelligent, fair-minded and experienced judge who will make a fine addition to the US supreme court, and who progressives should fully support.
Much has been made of Sotomayor's life story, and it is impressive. Born and raised into a Puerto Rican family living in a housing project in the South Bronx, Sotomayor earned a scholarship to Princeton University, where she graduated summa cum laude. She went on to Yale Law School, where she was editor of the Yale Law Journal, and after graduating worked in the New York district attorney's office. She was nominated to the federal district court by George HW Bush and elevated to the second circuit court of appeals by Bill Clinton. In both cases, her confirmation went smoothly.
Republicans and conservatives will argue that her nomination is an exercise in affirmative action, and that Barack Obama has effectively posted a "White males need not apply" sign on the doors of the supreme court – a funny complaint about an institution that is almost entirely white and male. Democrats and liberals will predictably trip over themselves arguing that Sotomayor's race and gender don't matter, even while race and gender matter.
The reality, of course, is that every supreme court justice comes in with a set of life experiences that are shaped not only by race and gender, but by experiences both professional and personal – it's just that few people consider that whiteness and maleness are not neutral identities and may shape one's perspectives and legal opinions just as much as femaleness or non-whiteness. Sotomayor herself has said: "I would hope that a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion than a white male who hasn't lived that life." And she's right.
While that quote is sure to be brought up as evidence that she's a "liberal activist", it's more indicative of the kind of self-awareness and reflection we want in a supreme court justice.
Judges have a marked historical tendency to move left over their supreme court tenures. There remains quite a bit of debate over why there's such a pronounced liberal shift, and it is no doubt a complex phenomenon. But I suspect it has to do in part with a slow realisation that the law has a real impact on peoples' lives, and that the law school classroom model of the law as a near-science and justice as consistency is fundamentally flawed and entirely unrealistic. "The law" as an academic exercise is certainly interesting, but one's view is bound to shift when, as supreme court justice Anthony Kennedy put it, "suddenly, there's a real person there."
Sotomayor is reflective and honest enough to recognise that her experiences – as a woman of colour, as a prosecutor, as member of a working-class family, as a judge – inform her understanding of and her empathy toward whichever real person is standing before her. While other judges may downplay the role that their race, gender and experience play in their legal work, those things do exert influence. Sit on the bench long enough and it must eventually become clear that rigidly interpreting language, deferring to precedent and valuing consistency above all else often result in thoroughly unjust outcomes.
So far, Sotomayor has been the picture of moderation (albeit left-leaning moderation). She has had good first amendment decisions and one particularly bad one (Doninger v Niehoff, where her panel affirmed the right of a school to disqualify a student from running for senior class secretary after the student posted vulgar and misleading school-related comments on her personal website).
She is deferential to law enforcement, leading to decisions like United States v Howard, where she held that state troopers could lure suspects away from their vehicle in order to search it for drugs.
And the decision she wrote in Center for Reproductive Law and Policy v Bush, which held that a Bush-era law limiting reproductive healthcare aid to developing nations did not violate the first amendment, due process or equal protection rights, certainly did not please any reproductive justice advocates.
But those are hardly reflective of her entire body of work as a judge. She's very plaintiff-friendly in discrimination cases. She wrote a dissent arguing that the Voting Rights Act should apply when evaluating state felon disenfranchisement laws. She stood up for first amendment rights in a case where the protected speech/expression was bigoted and presumably not easy to defend. She supported the right of an inmate to bring a case against a private corporation for redress of constitutional violations (a position that was narrowly reversed by the supreme court in an opinion written by Rehnquist).
She has written particularly progressive opinions in the area of disability discrimination. She has sustained claims of a hostile work environment in cases where female employees were subjected to sexual harassment and gender discrimination.
It's also worth noting that she is filling the seat of a moderate justice, and that if this confirmation fails, it will be because conservatives succeed in their smear campaign – not because she's unqualified and certainly not because she's too liberal. That means that Obama's next pick would likely be even more middle-of-the-road, and undoubtedly less appealing to feminists and progressives.
Sotomayor is far from a perfect progressive, and even further from the rightwing caricature of her as a liberal activist judge. But her breadth of experience, both professional and personal, make her a highly qualified jurist, and would lend the court much-needed diversity of perspective. She is smart, inquisitive and concerned with justice above all else. And that is precisely what a supreme court justice should be.

World’s Leading Jurists Call for Investigation into Crimes against Humanity and War Crimes in Burma

2009-06-08T02:58:00.000-07:00

New report from Harvard Law School finds that UN documents on Burma provide grounds for investigation into international crimes; calls for more concerted UN action on Burma

Cambridge, Mass. – Five of the world’s leading international jurists have commissioned a report from the International Human Rights Clinic at Harvard Law School, calling for the UN Security Council to act on more than fifteen years of condemnation from other UN bodies on human rights abuses in Burma. The Harvard report, Crimes in Burma, comes in the wake of renewed international attention on Burma, with the continued persecution of Nobel Peace Prize recipient Aung San Suu Kyi. The report concludes with a call for the UN Security Council to establish a Commission of Inquiry into crimes against humanity and war crimes in Burma.The Harvard report is based on an analysis of scores of UN documents – including UN General Assembly and Commission on Human Rights resolutions, as well as reports from several different Special Rapporteurs. These indicate that human rights abuses in Burma are widespread, systematic, and part of state policy – legal terms that justify further investigation and strongly suggest Burma’s military regime may be committing crimes against humanity and war crimes prosecutable under international law. Major abuses cited by the United Nations include forced displacement of over 3,000 villages in eastern Burma, and widespread and systematic sexual violence, torture, and summary execution of innocent civilians.Yet, despite such documentation from multiple UN organs, the UN Security Council has not moved to investigate potential crimes against humanity or war crimes in Burma, as it has in other areas of the world, including Darfur and Rwanda.“Over and over again, UN resolutions and Special Rapporteurs have spoken out about the abuses that have been reported to them in Burma. The UN Security Council, however, has not moved the process forward as it should and has in similar situations such as those in the former Yugoslavia and Darfur,” the jurists write in the report’s preface. “In the cases of Yugoslavia and Darfur, once aware of the severity of the problem, the UN Security Council established a Commission of Inquiry to investigate the gravity of the violations further. With Burma, there has been no such action from the UN Security Council despite being similarly aware of the widespread and systematic nature of the violations.”The five jurists who commissioned the report, from Africa, Asia, Europe, and North and South Africa, are Judge Richard Goldstone (South Africa), Judge Patricia Wald (United States), Judge Pedro Nikken (Venezuela), Judge Ganzorig Gombosuren (Mongolia), and Sir Geoffrey Nice (United Kingdom). Among other accomplishments, Judge Goldstone served on South Africa’sConstitutional Court and was the first prosecutor at both the International Criminal Tribunals for the Former Yugoslavia and for Rwanda. Judge Wald served as Chief Judge of the U.S. Court of Appeals for the District of Columbia and as a judge on the International Criminal Tribunal for the former Yugoslavia. Judge Nikken served as President of the Inter-American Court of Human Rights. Judge Gombosuren served as a Supreme Court Justice in Mongolia, and Sir Nice was the deputy prosecutor of the International Criminal Tribunal for the former Yugoslavia and the principal prosecution trial attorney in the case against Slobodan Milosevic in the Hague.Each of the five jurists has dealt directly with severe human rights abuses in the international system, and all five call for the UN Security Council to establish a Commission of Inquiry to investigate and report on crimes against humanity and war crimes in Burma.The Harvard report specifically examines four international human rights violations documented by UN bodies over the past fifteen years: sexual violence, forced displacement, torture, and extrajudicial killings. The report focuses on UN documents since 2002, to allow examination of the most up-to-date UN material, although UN reports dating back to 1992 have consistently condemned a wide-range of violations in Burma.Tyler Giannini, the Clinical Director of the Human Rights Program at HarvardLaw School and one of the report’s authors, said its findings clearly demonstrate that a Commission of Inquiry on Burma should proceed.“The UN Security Council has taken action regarding Yugoslavia, Rwanda, and Sudan when it identified information strongly suggesting the existence of crimes against humanity and war crimes,” said Giannini. “As our research shows, UN documents clearly and authoritatively suggest that the human rights abuses occurring in Burma are not isolated incidents – they are potential crimes against humanity and war crimes. Failure by the UN Security Council to take action and investigate these crimes could mean that violations of international criminal law will go unchecked.”For more information on Crimes in Burma, or to view a copy of the report, visit http://www.law.harvard.edu/programs/hrp/newsid=59.html.For media interviews in the United States, please contact Michael Jones at 617-595-7868 or mijones@law.harvard.edu, or Julianne Stevenson at 617-682-5519 orjstevenson@llm09.law.harva
rd.edu. For media interviews in Thailand, please contact Tyler Giannini at +66 89 020 6646 or giannini@law.harvard.edu. (read less)
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SURVEILLANCE STATES: Government Spying, Civil Liberties and the "Special Relationship"

2009-05-20T03:31:00.000-07:00

The American Civil Liberties Union, PEN American Center and Statewatch invite you to join experts from the US and UK at Garden Court Chambers on 31 May 2009 for a discussion of mass surveillance, its implications, and challenges to government policy and practice.

The panel will be moderated by CARLA FERSTMAN, director of REDRESS, a human rights organisation that helps torture survivors obtain justice and reparation.

The panel will feature:JAMEEL JAFFER, director of the American Civil Liberties Union (ACLU)’s National Security ProjectPATRICK RADDEN KEEFE is a fellow at the Century Foundation, a progressive policy think tank, and a frequent contributor to The New Yorker, The New York Review of Books, Slate, and other publications on issues of national security, civil liberties, human rights, and the rule of law.BEN HAYES, an associate director of StatewatchLARRY SIEMS, director of PEN American Center’s Freedom to Write program, which defends writers facing persecution around the world, and PEN’s Campaign for Core Freedoms, a major initiative to turn back new threats to freedom of expression in the United States.

Date:Sunday, May 31, 2009

Time:5:00pm - 6:30pm

Location:Garden Court Chambers

Street:57- 60 Lincoln's Inn Fields

Nearest tube: Holborn

Sweep away the thieves and their system

2009-05-20T03:30:00.000-07:00

'Fish rot from the head first'. The stink arising from the outright corruption, outright thievery - to give it its proper name - from the 'public purse', by the overwhelming majority of 'dis-honourable members' of the House of Commons presents a nauseating spectacle. It also discredits not just parliament and its inhabitants but the capitalist system itself.
Young people show their anger at the system, photo Paul Mattsson
Sometimes an event acts as a catalyst to bring all the festering discontent to the surface. The revelations first aired in the Daily Telegraph have had such an effect. While the shadow of mass unemployment looms over working-class people, with poverty worse than at the time of Thatcher, MPs are revealed to have filled their boots with ludicrously exaggerated 'expenses'. This has prompted some outraged 'respectable' journalists to call for the prosecution of some MPs.
Under Major, it was 'cash for questions', with Blair, 'honours' for business people. Now under Gordon Brown, everything is reduced to the 'cash nexus', as the nineteenth century writer Carlyle once said. MPs have claimed 'cash for cleaners', carpets, saunas - one even to be installed in an MP's home - swimming pools, gardeners, barbecues, dog food, and cushions - silk ones, naturally, 17 in all - "to ease the repose of Keith Vaz". Tory MP and former minister John Selwyn Gummer claimed for a mole catcher; ironic given the leaking of MPs' expenses and the prosecution of moles in the civil service! One MP claimed for a Kitkat and a Scottish Labour MP claimed for a 5p carrier bag! As Andrew Rawnsley commented in the Observer: "Well, he probably needs somewhere to stuff all his receipts."
A Liberal Democrat MP takes cash for cosmetics and one male Tory MP, unbelievably claimed for tampons! John Prescott - that New Labour working-class 'hero' - demanded on his expense account "three faux Tudor beams for his castle in Hull". He also claimed for two broken lavatory seats, prompting wags to declare: "It was two jags, then two shags, now it's two bogs Prescott."
Sham democracy
The sham of British 'parliamentary democracy' has been laid bare. Every major party is implicated in this real 'criminal conspiracy'. Some parliamentary luminaries, such as a former deputy Speaker, have suggested that "parliament may have to be dissolved". The depth of public disillusion is summed up by the august Observer commentator Rawnsley who used the language of the 'street' to signify the widespread disillusion: "The MP who claimed for horse manure? Well, why not when so many other parliamentarians simply don't give a shit"!
With a few exceptions, these are apposite words for the majority of MPs. Those who already have shed-loads of cash, it seems, wanted more, like Barbara Follett - of the 'wallet' - and renegade Tory MP and now New Labour minister Shaun Woodward, who has a butler but also claimed his 'expenses'. The MPs claim they needed to do this because of the 'inadequacy' of their parliamentary salary, which is... £64,000 a year!
Terry Fields MP, who took just the wage of an average worker, photo Steve Gardiner
What a contrast to the socialist and Marxist former MPs, Dave Nellist and the late Terry Fields and Pat Wall, who took just the wage of an average worker. But that was when the Labour Party at the bottom stood for working people.
Compare also the MPs to the lot of the poverty-stricken woman interviewed by the Guardian last week, trying to feed her family on a budget of £3 a head per day! Yet government minister James Purnell, while dipping his own snout into the trough, still intends to persecute and punish people like her on benefits through no fault of their own while MPs and bankers will probably get away scot free! Taken together with the scandal of bankers' bonuses and the complete failure to deliver the basics of a job, a home and a decent income for millions of workers in this country, the whole system of parliament and capitalism is nakedly exposed.
The 'institutions' of this system - including parliament, as these revelations confirm - are discredited. If a mass workers' party existed in Britain today, the revulsion felt over these and other measures which benefit the rich and punish the poor could be used to build a mass wave of opposition that could pose a real alternative. The 'No2EU' campaign for the European elections is the beginning of such an alternative.
Corrupt at every level
Socialists and the labour movement fought for and support the democratic conquests which exist. We and our forebears made the greatest sacrifices for the right to vote, a free press, trade union rights and representative systems at national and local level which could reflect the 'will of the people'. But the present 'parliament' is revealed to be a million miles away from this ideal.
The press and media are controlled by a handful of rich moguls with the voice of ordinary people drowned out by a cacophony in favour of the 'market', which has utterly failed the majority of the population. Three almost identical parties - New Labour, the Tories and the Liberal Democrats - are mired in corruption, as these revelations have shown, and offer absolutely no way forward.
Parliament itself, with five-yearly elections and MPs on bloated salaries and expenses, is completely unrepresentative. Two centuries ago, the French philosopher Rousseau criticised the British parliamentary system: "If the English people think they are free, they deceive themselves; they are only free during the election of members of Parliament; as soon as these are elected, the people are slaves, they no longer count for anything... The deputies of the people thus are not nor can they be the people's representatives." An accurate picture of British democracy today!
The pioneers for democracy in Britain, the Chartists - the first independent workers' party in history - demanded annual parliaments. When the first Labour MP, Keir Hardie, entered the House of Commons he was not paid and nor were any MPs. However, unlike Hardie, MPs then were mostly Tories and Liberals who had 'independent incomes'. The very minimum that should now be demanded is that no MP should have 'outside interests', directorships or advisory positions with private companies, ie big business.
As Mark Lawson, the TV and art critic, has pointed out, why not go further and propose that no MP should receive more than the average wage? This would certainly thin out the ranks of MPs and would-be MPs from the 'upper tiers' of society but would make way for those more in touch with the feelings of the majority, ie working class people.
But in time it will be necessary to go further than this. The election of any representative for five years to an institution like the present parliament is inherently undemocratic. These MPs are not accountable to the constituents who elect them, other than once every five years, and even then their record is never properly put under scrutiny.
Socialists support all democratic rights, including voting for parliament. We would fight along with working people against any attempt to overthrow a democratically elected government as happened in Chile in 1973 and Spain in the 1930s.
Change needed
But a more representative, accountable system than we have at present is necessary. The House of Lords should be abolished; there should be a single assembly which combines the legislative and executive powers hitherto divided in Britain.
Members should be elected for a maximum of two years with votes at age 16. MPs could then be elected on the basis of democratic local assemblies with the right of recall by their constituents, and should receive the salary of a skilled worker.
Democracy like this would lead to greater participation by the mass of the population. A change in the electoral system to proportional representation would also be an improvement.
Compared to the present undemocratic set-up - which rests power in the hands of an elite - the above changes would represent a big step forward. In the absence of a mass workers' party in Britain today, such demands and slogans are probably in advance of what most, even working-class, people would support at the present time. But the nausea arising from the revelations of thievery by parliament and parliamentarians is preparing the ground for the adoption of such bold demands in the future.
In the meantime, the salary of MPs must be cut to the level of the average wage. Where expenses are needed, they should be strictly necessary ones only - similar to what some building workers and others are paid as they travel the country in pursuit of their work. Moreover, rather than an 'outside body' checking and auditing expenses, why not scrutiny committees made up of workers, the unemployed, those forced onto benefits and small shopkeepers and business people threatened by the present recession?
The MPs' expenses scandal will lead to recognition that a system based on production for profits for the few - the millionaires and billionaires - rather than for social needs of the majority, the millions, inevitably produces the kind of rottenness and corruption that we are witnessing.
We defend all democratic rights - which must also include today the abolition of the vicious anti-trade union laws inherited from Thatcher. But at the same time we aim for an extension of democracy, for a democratic socialist state, not the truncated 'elected dictatorship' which parliament is at present.

A catechism for a system that endures

2009-05-20T03:29:00.000-07:00

By Samuel Brittan
Published: April 30 2009 19:44 Last updated: April 30 2009 19:44

Capitalism is not a system that some government decided to install, as the Soviet leaders did with “socialism”. It evolved over many years. Once established, governments of many different stripes could try to copy it, with widely varying results. There has been a long cycle among opponents, who begin by declaring it immoral, go on to predict its inevitable collapse and, when that does not happen, return to its supposed immorality. The system will continue but with a less overblown financial sector.
One of the myths about the system is that it is just about markets and prices. Visitors to the most remote villages in the developing world have often remarked on the ubiquity of market activities. Successful capitalism requires a great deal more. At a minimum it also requires:
1. A basis for long-term contracts. Such contracts in turn require:
2. The rule of law. This does not just mean judges in wigs or parliamentary assemblies. It means generally understood rules of the game so that economic agents can make plans that will not be undermined by unpredictable political intervention, criminal action or any other destabilising activity.
3. A minimum of trust so that entrepreneurs and others can undertake projects without constantly looking over their shoulder to see that undertakings are observed, and that commercial partners are not looking for ways to renege on obligations or to twist their meaning.
4. So far, what has been said only defines mercantile societies going back to medieval city-states, Shakespeare’s Venice or even earlier. The word “capitalism” was popularised by Karl Marx in the middle of the 19th century to describe a world characterised by, among other things, “roundabout” methods of production involving structures such as factories, railways and steamships.
5. Capitalism depends on private ownership of the greater part – not necessarily the whole – of the means of production, distribution and exchange. Joseph Schumpeter, in a postscript added to the UK edition of his path-breaking Capitalism, Socialism and Democracy, remarked that only the nationalisation measures of the postwar Labour government counted as genuine socialist steps. All the rest, such as wage and price controls, trade restrictions or attempted “economic planning”, whether wise or unwise, could be found in many capitalist societies. The temporary state ownership of some banks does not count as state socialism so long as private banks are not prevented from starting up.
Some reformers have envisaged a market society based on workers’ co-operatives rather than traditional private ownership. This, for example, is what John Stuart Mill meant by socialism. Whether that is correct is a semantic matter. The point of substance is that although there have been individual successful examples of employee-owned enterprise, such as Britain’s John Lewis retail partnership or the Mondragón group in Spain’s Basque Country, there have been few, if any, examples of whole societies operated on these lines, outside of Tito’s Yugoslavia.and Cuba.
6. Capitalism works best when there is competition between producers. But the degree of competition varies immensely. Businessmen do not in practice always welcome competition and a commentator can be pro-capitalist without being pro-business. Free trade is best treated as part of the competition agenda rather than as a separate undiscussable good.
7. Successful capitalism requires a good deal of economic freedom, although not necessarily laisser faire. The defects of capitalism are often called market failures: things such as environmental overspills or inadequate provision of public services. Moreover, a market system does not even pretend to provide a just distribution of income and wealth, whatever that is. At different times observers have claimed to detect trends both to increasing concentration of income and wealth, and towards a levelling of differences. Vilfredo Pareto, the early 20th-century economist, claimed that in the very long run the pattern of pre-tax distribution is surprisingly stable. Contrary to what zealots claim, taxes and benefits can influence income and wealth distribution provided that care is taken not to kill the goose that lays the golden eggs.
8. The capitalist system requires at least the possibility of separating ownership from control. This has been facilitated by the rise of limited liability laws since about the middle of the 19th century. But the practice also give rise to what modern economists call the “principal agent problem”: how the owners can control the managers.
9. Although there is a variable and often high degree of ploughed-back profits, there must be provision for a capital market in which savers can lend to enterprises (and governments) whose investment needs exceed their own resources. Such arrangements, in turn, require a secondary market in paper titles to wealth, nowadays called stock exchanges.
10. Any market system requires a functioning money, both to avoid the wasteful complications of barter and to serve as a standard of value. It does not require literally zero inflation but cannot well cope with unpredictable wild fluctuations.
11. Capitalism also requires depositary institutions where people can store their money without hoarding it under the mattress.
“Boom and bust” has been a feature of capitalism from the beginning, originating partly in the alternation of moods of pessimism and optimism. Not all recessions originate in the financial sector but those that do have, on average, been more than twice as severe as those that do not.
The present credit crunch leaves more or less unaffected the arguments for and against the first seven principles affecting what is sometimes called the “real” side of the economy. But it calls into question present arrangements for 9, 10, 11 and aspects of 8 – what might be called the “financial side”. The mutual entanglement of savings and investment decisions, money creation and deposit banking, has caused much harm and there have been numerous ideas for separating them – my favourite being the proposal of Henry Simons, the US economist, for “narrow” banks that can hold only assets in cash, deposits with the central bank or short-term government securities and are therefore safe against a run. But it is not a panacea.
Clearly there will now be a trend back towards a more regulated type of capitalism, as in the 1930s. But not all the regulation will be very wise. The perennial problem of regulation is the concentration of producer interests, which makes for successful lobbying, and dispersion of consumer and general citizen interests, which are therefore more difficult to organise. Moreover, much discussion is vitiated by the assumption of omniscient and benevolent government instead of balancing market failure against government failure. There is a vast body of US writing on the subject known as “public choice” ignored by authors of fashionable critiques such as Nudge or Animal Spirits.
Another problem is that capitalism is nowadays global but regulation is still at the national level. The most difficult issues, however, arise on the moral side. The assumption that the pursuit of self-interest within the rules and conventions of society will also promote the public interest is not likely to survive – if only because the content of these rules is up for grabs. But it is all too likely to be succeeded by a mushy collectivist pseudo-altruism, in which jealousy and envy are given a free ride.
Perhaps something is to be learnt from the social market theorists of the postwar “German economic miracle”, who were by no means opposed to government intervention but had firm principles regarding its nature, purpose and duration. Personally, I would go further back still. I know that some financial types hate their subject being mixed up with alien topics such as the study of English literature. Yet more is to be learnt from the novelist Jane Austen, who took for granted the legitimacy of property titles but insisted that such rights had their obligations, than from modern tomes on business ethics.
www.samuelbrittan.co.uk

'In the name of God, go'

2009-05-20T03:25:00.000-07:00

What to do with Parliament? What to do with MPs who have bought and sold properties using taxpayers’ money, who have had their swimming pools cleaned and have even claimed for tons of horse manure on expenses? What to do with an institution that is said to be the cornerstone of the British constitution but whose members are preoccupied with feathering their own nests?
Similar concerns preoccupied Oliver Cromwell, whose statue stands in front of the Commons. In 1653, with the Civil War won, a tyrannical King executed, the rule of Parliament over monarchy irrevocably established and England now a republic known as the Commonwealth, MPs were trying to fix the new system to benefit themselves.At 11 o'clock in the morning of 20 April 1653, Cromwell led a company of musketeers to Westminster. Having secured the approaches to the House, he addressed the Members in a speech about corruption that is worth repeating in the light of events three and half centuries later:
...It is high time for me to put an end to your sitting in this place, which you have dishonoured by your contempt of all virtue, and defiled by your practice of every vice; ye are a factious crew, and enemies to all good government; ye are a pack of mercenary wretches, and would like Esau sell your country for a mess of pottage, and like Judas betray your God for a few pieces of money.Is there a single virtue now remaining amongst you? Is there one vice you do not possess? Ye have no more religion than my horse; gold is your God; which of you have not barter'd your conscience for bribes? Is there a man amongst you that has the least care for the good of the Commonwealth?Ye sordid prostitutes, have you not defil'd this sacred place, and turn'd the Lord's temple into a den of thieves by your immoral principles and wicked practices? Ye are grown intolerably odious to the whole nation; you were deputed here by the people to get grievances redress'd; your country therefore calls upon me to cleanse the Augean Stable, by putting a final period to your iniquitous proceedings, and which by God's help and the strength He has given me, I now come to do.I command ye, therefore, upon the peril of your lives, to depart immediately out of this place! Take away that shining bauble there, and lock up the doors. You have sat here too long for the good you do. In the name of God, go!
At Cromwell's signal, Lieutenant-Colonel Worsley marched in with the musketeers to drive out the MPs. The doors were sealed and a wit pinned up a notice outside reading: "This House is to be let: now unfurnished."Now, this is not 1653 and the revolutionary New Model Army that backed Cromwell’s dissolution is no longer. But history has come a full circle. The parliamentary system of rule that was eventually established (with few people having the vote until 1867) has clearly run its course.The expenses’ scandal itself reflects a deeper crisis of democracy, where today’s Parliament is toothless and powerless in the face of the executive, who in turn are accountable to powerful corporate and financial interests and not the electorate. Electing a cleaner, more honest group of MPs would not in itself be sufficient in what has developed into a full-scale crisis of the capitalist political system. It is not inconceivable that a corrupt Parliament becomes an excuse at some stage (especially at a time of social unrest) for direct, authoritarian rule. What is required is a new, democratic constitution that would transfer power to the people in terms of direct control and ownership of productive and financial resources as well as new forms of more direct representation and participation in political life. If Parliament is to survive, it can only be as part of such a revolutionary transformation of the social system as a whole, in which people themselves are sovereign. Paul FeldmanAWTW communications editor 12 May 2009
http://aworldtowin.net/blog/in-name-of-god-go.html

Courts rule British soldiers covered by right to life

2009-05-20T03:24:00.000-07:00

Michael Evans, Defence Editor

Army chiefs can be sued over decisions taken in the heat of battle after a Court of Appeal ruling that troops must be protected by the Human Rights Act.
The judgment by Sir Anthony Clarke, the Master of the Rolls, and two other judges, makes the Ministry of Defence liable to civil prosecutions by families who claim that the treatment of soldiers who have died on operations overseas might have breached their human rights.
The landmark ruling follows a long-running battle between the MoD and Andrew Walker, the assistant deputy coroner of Oxfordshire, who has criticised the ministry for sending troops to war allegedly with defective equipment.
The judgment provoked anger from General Sir Mike Jackson, the former head of the Army. He told The Times: “I cannot imagine that this is what Parliament had in mind when it voted for the Human Rights Act . . . It’s potentially very dangerous and could damage operational effectiveness because commanding officers will be concerned that they run the risk of being taken to court over decisions they have had to make.”
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Yesterday’s judgment concerned the case of Private Jason Smith, 32, of the Territorial Army, who died of heatstroke in Basra six years ago. At the inquest, in 2006, Mr Walker said that his death was caused “by a serious failure to recognise and take appropriate steps to address the difficulty that he had in adjusting to the climate” — temperatures of 50C. The coroner said that it amounted to a breach of his human rights.
Private Smith, from Hawick, in the Scottish Borders, was serving in the 52nd Lowland Regiment. He was unmarried but had a long-term partner.
The MoD conceded that Private Smith was within the jurisdiction of European and British human rights laws because he died while in hospital at a British base in Iraq. But MoD lawyers challenged a general-principle ruling by Mr Justice Collins in the High Court in which he said that members of the Armed Forces always remained in the jurisdiction of the UK and were therefore covered by the Human Rights Act wherever they were serving overseas.
The MoD argued that soldiers could not be protected by human rights laws if they were fighting “beyond the wire” of a base. Mr Justice Collins dismissed the MoD appeal and yesterday the Master of the Rolls, one of the most senior judges, agreed with his judgment and also threw out the ministry’s case.
“For the purpose of determining whether there is a sufficient link with the UK to qualify for protection, it seems to us to make no sense to hold that there is a distinction between a person inside and outside premises controlled by the UK,” the judges ruled.
Catherine Smith, Private Smith’s mother, said: “I welcome the judgment, but I really feel let down by the Army. The Army used to be a family but that doesn’t seem to be the case any more. There is no back-up. It is too late for my son but it is a good thing that everyone in the Army now will be covered by the Human Rights Act.”
Mrs Smith criticised the MoD for failing to provide her son’s medical records at the inquest, and a new inquest is now to be held. Yesterday’s ruling by the Court of Appeal also obliges the MoD to provide more information to bereaved families. The MoD’s lawyers are now considering an appeal to the House of Lords, although the judges said yesterday that the ministry would have to foot the bill whether it won or lost.
Have your say
How can sending troops into battle with defective equipment NOT be negligent? The obscene profits made by the same people who promoted the war in the US, should make us all think very hard about the actions of the militant elderly using the young as cannon-fodder. It has happened in every war.
Angela, Epping, Australia
As a former soldier myself, I welcome the fact that there will be a positive duty to provide the 'right tools' for the job. It wont stop commanders doing what they are now, so long as they can prove that they thought through the implications of their actions; it wont stop people being heros anymore.
Bob, London, UK
some progression... maybe soon people will realise war itself is against human rights
kieran, london,

sri lanka and the tamils

2009-05-20T03:23:00.000-07:00

Press Release: UK government faces legal challenge over Sri Lanka
The UK government faces a possible judicial review over its failure to comply with its obligations under international law in light of the worsening crisis in Sri Lanka. On Monday 27 April, Justice for Tamils (representing a group of Sri Lankan Tamils residing in the UK) and the human rights law firm Public Interest Lawyers sent a “letter before action” to the relevant Secretaries of State of the UK government.
The letter details that in face of the Sri Lankan government persistently and systematically breaching international humanitarian and human rights law, arguably carrying out war crimes and acts of genocide against the Tamil community, all states, including the UK have obligations under international law to act in certain ways. The situation in Sri Lanka could not be more serious. According to UN figures released on 24 April almost 6,500 ethnic Tamil civilians have been killed and 14,000 more injured since late January. These figures, which do not include those killed in last week’s intensive fighting, mean that in the past three months an average of 70 civilians have died each day. It is submitted that in light of this horrifying situation the UK under international law has various obligations, namely, to denounce and not recognise the situation in Sri Lanka as lawful; not to render aid and assistance to Sri Lanka; to use all lawful means to bring Sri Lanka’s breaches to an end and to take all possible steps to ensure Sri Lanka respects its obligations under international humanitarian law. Justice for Tamils contend that the UK government’s response thus far has been woefully inadequate and does not comply with its obligations under international law. The proposed visit to Sri Lanka by the Foreign Secretary, the appointment of a Special Envoy and the various public pronouncements are not nearly enough to satisfy the obligations imposed on the UK under international law.The letter before action asks the UK government to set out in clear detailed terms, supported by evidence of the actions taken, exactly how it purports it has met and will continue to meet all of its obligations imposed by international law arising from the situation in Sri Lanka. Amongst other things, the letter seeks:• An immediate, clear and unequivocal declaration that the UK government will vote against the proposed $1.9 billion IMF emergency support loan to the Sri Lankan government. To agree to an IMF loan when the Sri Lankan Government is perpetrating gross violations of humanitarian and human rights law would be a flagrant breach of the UK’s international obligations.• An urgent explanation and justification of the sale of military equipment to the Sri Lankan government in 2008 and 2009. • An unequivocal written assurance that there is no question that any UK products or components could be or may continue to be implicated in the attacks on civilians in Sri Lanka in the context of the egregious human rights violations being committed.• A suspension of all arms export licences to the Sri Lankan government:• A full and clear explanation as to what steps the UK has taken to:(i) ensure a cessation of preferential trading with Sri Lanka;(ii) cooperate with other states to bring an end to Sri Lanka’s serious breaches of international law;(iii) satisfy its duty to investigate and where appropriate prosecute those accused of war crimes, crimes against humanity and acts of genocide.If the UK government fails to adequately reply to the letter, proceedings for judicial review will be lodged at the High Court without delay.If you would like any further information, please do not hesitate to contact Mr Kesavan of Justice for Tamils, 07968 52 55 63, justice4tamilsuk@googlemail.com or Tessa Gregory at Public Interest Lawyers, 0121 515 5069, tessa.gregory@publicinterestlawyers.co.uk. www.publicinterestlawyers.co.uk 28 April 2009

Tackling Britain’s fiscal debacle

2009-05-12T01:38:00.000-07:00

Published: May 7 2009 19:45 Last updated: May 7 2009 19:45
In 2010, according to the European Commission’s latest forecasts, the UK government will be spending 52.4 per cent of gross domestic product and receiving just 38.7 per cent of GDP in revenue. It will, as a result, have a gigantic general government deficit of 13.8 per cent of GDP. Worse, the UK’s cyclically-adjusted deficit will be 12.2 per cent of GDP. These are numbers one would expect in a time of war.
Only five of the 27 members of the European Union are forecast to have a higher share of public spending in GDP than the UK in 2010: Sweden (57.3 per cent); Denmark (57 per cent); France (56.4 per cent); Finland (54.3 per cent); and Belgium (also 54.3 per cent). But only six EU members will have a lower revenue share than the UK: Romania (33.3 per cent); Ireland (33.5 per cent); Slovakia (34.1 per cent); Lithuania (34.8 per cent); Latvia (36.2 per cent); and Spain (37.3 per cent). Just one member will have a bigger deficit than the UK: Ireland, on 15.6 per cent.
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The forecast deterioration in the UK government’s fiscal balance, of 11.1 per cent of GDP between 2007 and 2010, is also the fourth largest in the EU, after Ireland (15.8 per cent), Latvia (13.2 per cent) and Spain (12.0 per cent). How did this fiscal debacle occur? The answer lies far more in spending, forecast to jump by an astounding 8.4 per cent of GDP between 2007 and 2010, than revenue, forecast to shrink by a more modest 2.6 per cent of GDP.
What makes the UK’s rise in government spending as a share of GDP puzzling is that the decline in GDP itself is not exceptional. The Commission forecasts the decline of UK GDP at 3.8 per cent this year, slightly less than for the EU and the eurozone, both of whose economies are expected to shrink by 4 per cent. In 2010, the UK economy is forecast to grow by 0.1 per cent, again slightly better than the EU and the eurozone, both on -0.1 per cent.
The painful conclusion must be that the UK has lost control over public spending. It has to get it back again. Whether they like it or not, UK voters will have to elect a government willing to achieve this end. Government solvency is at stake. The next government will, as a result, find itself in a war of attrition with its own servants. If David Cameron leads the Conservatives to victory, as many expect, he will have to be tougher than Margaret Thatcher, elected prime minister three decades ago.
It is possible, of course, that a powerful recovery will do the trick. In the Budget, the Treasury concluded that the UK had suffered a permanent loss of 5 per cent of GDP as a result of the crisis, while trend growth was 2¾ per cent. The Treasury also assumes the output gap – a measure of excess capacity – will peak at 5 per cent of GDP, then disappear.
It would be highly irresponsible to plan the public finances on the assumption that the economy will soon return to the level and assumed growth of the pre-crisis era. Indeed, I share the view advanced by Robert Chote, director of the Institute for Fiscal Studies, in a recent study, that the UK had an unsustainable boom. A part of the economy was an illusion.
It is possible to propose that, since the British now spend like the French, they should pay taxes like the French. But that would mean a huge increase in taxation – perhaps of as much as 10 per cent of GDP. While some increase in tax rates will be inescapable, to bring the ratio back to where it was before the crisis, the British are not going to accept a vast increase in the tax burden.
Nor is it reasonable to assume that such huge deficits can be run for long without risking big jumps in interest rates. The Treasury forecasts a rise in public sector net debt from 36.5 per cent of GDP in 2007-08 to 76.2 per cent in 2013-14. It is likely to end up higher. A prudent government would not only wish to halt this rise but also to reverse it, to renew the fiscal flexibility it is using up.
Government spending will have to be cut down to size. According to the IFS, the government has pencilled in the tightest spending plans over a seven-year period since April 1985 to March 1992: a 0.1 per cent annual average real increase from 2011-12 to 2013-14, followed by a possible 0.5 per cent annual real increase in current spending for a further four years. This is the least that has to be achieved, given the dire starting position. In effect, government spending may have to be stagnant in real terms for almost two successive parliaments.
That is what happens to a country that has not only spent freely, but now finds itself far poorer than it had hoped. It is clear what this must mean: a sustained freeze on the pay bill; decentralised pay bargaining; employee contributions to public pensions; and a pruning of benefits. It is obvious, too, that this will mean massive and painful conflict between governments and public workers.
Hitherto, the vastly increased levels of government borrowing have concealed the true extent of this crisis. But these deficits will have to be eliminated. The bulk of the action will have to come from control over public spending. The next prime minister is likely to end up quite as hated as Margaret Thatcher was. But, as she liked to say, there is no alternative. The unsustainable cannot endure. If UK policymakers do not take the needed decisions willingly, markets will force them upon them.
martin.wolf@ft.com

How tax havens helped to create a crisis

2009-05-06T06:40:00.001-07:00

By Sol Picciotto
Published: May 5 2009 20:04 Last updated: May 5 2009 20:04
Banks employ large teams of highly paid people to devise transactions mainly for the purpose of avoiding tax. These activities seem to be far more profitable than the humdrum business of managing payments and channelling savings towards investment. Why?
The answer shows the close link between tax avoidance and the speculation that has fuelled financial instability for 30 years. There were clearly other causes of the current crisis but the faults of the international tax system were a big contributory factor.
International tax co-ordination depends on treaties based on a model devised 80 years ago. To prevent double taxation, the treaties generally give governments the right to tax returns from an investment in the investor’s country of residence. Business profits, meanwhile, are taxable in the “source” country where the activity takes place.
But for most of the past century, international investment was dominated by multinational corporations, which could choose the location of their sources of funds and organise their affiliates’ capital structures. This enabled them to devise techniques to ensure that they were not taxed unfairly, as they saw it, exploiting ambiguities in the concepts of residence and source using legal entities formed in convenient jurisdictions. Such methods were also pioneered, with rather less legitimacy, by wealthy people resentful of high income taxes.
The relaxation and final abandonment of exchange controls in the 1970s led to the blossoming of “offshore” finance and a boom in tax havens. These depend on both outright tax evasion and the exploitation of grey areas by tax avoidance. Since large multinationals are as much financial as business entities, they have freedom to devise complex financial structures – financial institutions, such as banks, even more so: in recent separate surveys by the US Government Accountability Office and the Tax Justice Network, the largest user of tax havens in every country surveyed was a bank. Tax authorities have enormous problems puzzling out these structures. If they can, it is often hard to characterise them as shams.
The leading countries themselves are also host to major financial centres, from which most of these activities are directed. The revenue authorities in these countries, not least the US and the UK, have been cowed into accepting these activities for fear of losing finance business.
Take hedge funds, for example. The tax authorities in the US and the UK have accepted a lax interpretation of residence and source rules, accepting that these funds are resident and their profits sourced offshore (mostly in the Cayman Islands) – even though they are effectively managed from London and New York. Not only are the funds’ gains treated as realised in Cayman, and hence not taxable, but their distributions are not subject to withholding tax – a great benefit for their investors. The funds’ location in a secrecy jurisdiction facilitates tax avoidance and is an open invitation to evasion.
For multinationals and rich investors the point is the same: returns on financial transactions are ultimately taxed at a low or zero rate, making them far more profitable than genuine business endeavours. This distortion of the tax system has greatly fuelled the excess of liquidity channelled into largely speculative financial transactions. The offshore secrecy system has been a main element of the opacity that has undermined corporate and financial regulation.
The remedies lie in fundamental reforms of international fiscal and financial regulatory co-operation, and their co-ordination. International tax co-operation requires a comprehensive, multilateral system for both obtaining and exchanging information for all tax purposes, with proper safeguards for taxpayers. Requiring multinationals to break down their accounting information by each country in which they do business would inject much-needed transparency into the system. Reform should include a shift towards unitary taxation, which most international tax specialists recognise is long overdue. This would be preferable to the Obama administration’s new proposals to tinker with US rules on tax deferral.
These reforms would make the international tax system more effective and fairer, and remove a major rationale for tax havens. They would produce large cost savings for business and perhaps even close down the departments in banks that conjure up wasteful and distorting tax-driven schemes.
The author is an emeritus professor at Lancaster University and a senior adviser to the Tax Justice Network.

High stakes, low finance

2009-05-05T04:04:00.000-07:00

Will Hutton traces the banking crisis back to the Big Bang
Will Hutton
The Guardian, Saturday 2 May 2009
Article history
Chasing Alpha: How Reckless Growth and Unchecked Ambition Ruined the City's Golden Decadeby Philip Augar272pp, Bodley Head, £20
Fool's Gold: How an Ingenious Tribe of Bankers Rewrote the Rules of Finance, Made a Fortune and Survived a Catastropheby Gillian Tett352pp, Little, Brown, £18.99
Meltdown: The End of the Age of Greedby Paul Mason192pp, Verso, £7.99
The Crash of 2008 and What It Means: The New Paradigm for Financial Marketsby George Soros288pp, Public Affairs, £9.99
Gordon Brown will not think it, but in the politics of credit crunch he is a lucky man. His speech at the Mansion House on Wednesday 20 June 2007, days before he took office as prime minister, is one of the greatest political and economic misjudgments among postwar politicians. Yet very few have read or even recollect it. But then his political opponents, outbidding him at the time in their slavish praise of the City, have even more embarrassing quotes on the record. They are hardly in a position to attack him.
"This is an era that history will record as a new golden age for the City of London," Brown intoned. "I want to thank all of you for what you are achieving." Just weeks later the financial catastrophe burst, creating the "great recession" and leaving the UK taxpayer with a one-sided exposure of £1.3 trillion in loans, investments, cash injections and guarantees to the banking system, of which over £100bn may be lost for ever. Brown went on to hymn the City's "creativity and ingenuity" that had enabled it to become a new world leader. In language so purple it could make a cardinal blush, he praised London's invention of "the most modern instruments of finance" - the very instruments that were to bring it and the western banking system down.
Invoking Adam Smith, Brown declaimed: "The message London's success sends out to the whole British economy is that we will succeed if, like London, we think globally ... and nurture the skills of the future, advance with light-touch regulation, a competitive tax environment and flexibility." He even managed to boast that, after financial and accounting scandals in the US such as those that brought down Enron and WorldCom, which led the American government to introduce new regulatory reforms, "many who advised me, including not a few newspapers, favoured a regulatory crackdown. I believe we were right not to go down that road."
The boastfulness, the wholesale endorsement of the philosophy that was to bring the world to the economic edge and the sheer ignorance are painful to read - tribute to the way the bankers completely pulled the wool over the eyes of the political and regulatory establishment in one of the greatest heists the world has witnessed. The IMF now calculates that there are $4.1 trillion of losses in the world financial system, less than half of which has been formally written off. Without massive government support, the scale of the banking collapse that would have followed such losses would have induced a global depression. Even as it is, world trade will this year decline by 9%. Alistair Darling's budget has already passed into legend as the most depressing since the war. The credit-crunch-ravaged, post-recession British economy will be unable to shoulder the size of the current British state. In the most challenging decade since 1945, a way has to be found of shrinking its size while still finding new ways to grow and alleviate mass unemployment.
It is a disaster, or, as BBC Newsnight's Paul Mason would have it, a financial Krakatoa. It is the economic and financial story of our times, and he, the Financial Times journalist Gillian Tett and financial author Philip Augar have all been inspired to write "crash" books. Each is gripping and revelatory, with sometimes breathtaking quotes or new facts, and each adds a different dimension to our understanding of the crisis. Their subtitles tell of greed, recklessness and catastrophe - and all three writers are as good as their promise. What has happened to finance and the financial system since London's Big Bang in 1986 is an astounding story of ideology, greed and lack of restraint - sanctioned by our politicians who, like Brown, marvelled at the apparent results without beginning to understand how they were achieved. Moreover, they built regulatory systems to suit the bankers' interests. You might have hoped that politicians of the left would have been savvier and more suspicious of the bankers' claims. One of the tragedies of New Labour is that the party leadership bought the story so completely - Brown becoming as much of a zealot for free-market financial innovation as the free-market fundamentalist neocon Alan Greenspan, whose knighthood he organised.
The books leave no doubt that it is the bankers and their greed who were the authors of the crisis. True, there were dollars spilling out of Asia and the Gulf in huge volumes in the 2000s, and low interest rates created an appetite for taking risks. But bankers seized the opportunity to lend unprecedented amounts on ever smaller amounts of capital, with the risk apparently abolished by the invention of new financial instruments and tradeable insurance contracts. This is Tett's original contribution. Her blow-by-blow story of how these were developed during the 1980s and 90s, and the motivations of those who did it, is an impressive piece of detective work. She pulls back the curtain on a closed, unaccountable world of finance - a "silo in its own right detached from society". My only cavil is that I wish she could have got as much access to top British bankers as she got to American ones, and in particular those in JP Morgan: her locus is too much New York.
That is made good by Philip Augar, a former investment banker who has made it his mission to reveal the systemic and destructive way that British finance works. He understands both the people and the processes - and Chasing Alpha is his best book yet. He even devotes a chapter to Brown's Mansion House speech. Together, he and Tett make it clear beyond peradventure that it was the structure of the financial system that created the havoc, and that it was firmly embedded in the intertwined London and New York markets from the 1980s onwards. Similar-scale dollar surpluses in the 1970s did not create such financial problems; but that was before the Thatcherite and neoconservative revolutions.
In 1933 Senators Glass and Steagall, prompted by Roosevelt, had sponsored the Glass-Steagall Act, prohibiting investment bankers betting deposits on the buying and selling of tradeable financial securities that can create huge losses. Banking and investment banking should be separate. For 50 years the act kept American banking honest. But after Mrs Thatcher decided in 1986 that banks could own stockbrokers and market-making stock jobbers in her new anything-could-go casino City of London - the "Big Bang" - American banks complained to the US central bank, the Federal Reserve, that they could do things in London not possible in New York. Paul Mason explains how in 1987 the Fed relaxed Glass-Steagall to allow 5% of a bank's deposits to be used for investment banking, further relaxed to 25% in 1996. The act's abolition in 1999, which opened the floodgates for today's financial catastrophe, was inevitable - even if it cost the banks $300m in lobbying fees.
Tett shows how the regulators rolled over in another core area. In the late 1990s they accepted the banks' argument that their alchemy in creating collateralised debt obligations (bundling up income-generating assets of varying quality into one security) and then insuring against the risk of default (credit default swaps) both merited the triple A credit scores the credit agencies were awarding and, crucially, needed less capital to stand behind them. By 2000 the stage was set for what was to follow: investment banks having balance sheets 30 times or more larger than their core capital, refinancing as much as a quarter of their trillions of dollars of liabilities every day from the so-called wholesale money markets, and lending/investing in a range of highly risky financial instruments. The system could not insure against its own systemic failure. It was an edifice built on sand: $1 trillion of sub-prime debt had been bundled into various categories of structured, tradeable debt; when American house prices began to crumble in 2007, the whole interlinked pyramid came crashing down.
Mason's first three chapters are a page-turning account of September and October of last year, when it did look as though the American and British financial systems were about to collapse - the fateful weekend in September when Lehman Brothers went bust and America's top insurance company AIG only survived courtesy of an $80bn loan, and later, in early October, when Britain's RBS and HBOS were hours away from implosion. Mason, I think correctly, emphasises the highly risky way some British commercial, and other, mortgage lenders had become reliant on the money markets to support their lending, so that RBS and HBOS were in an analogous position to the US investment banks Lehman and Bear Stearns, both of whom went bust. At the root of the crisis were the interaction of money market-financed balance sheets, too much consequential borrowing and the new "weapons of mass financial destruction".
Mason is refreshingly clear-eyed about the operation of today's finance-driven capitalism - and angry. It wasn't only that the banks and insurance companies campaigned to have the law changed to serve their interests with such disastrous results. Sometimes, as with AIG, they began to transgress the law. AIG admitted in 2005 that it had faked $500m of transactions to fool the auditors, and "misclassified" another $3bn to inflate its profits. I have no doubt that there are more instances that may never come to light. Britain has insured £585bn of bank loans. It is hard to believe that every penny of bad debt on such a scale was just honest misjudgment. Do we believe that the British were angels and the only frauds American?
George Soros, successful hedge fund entrepreneur and famous beneficiary of the pound's expulsion from the European Exchange Rate Mechanism, has been trying for decades to explain that the axioms of free-market economics do not apply to the financial markets. Brown and Greenspan were always wrong to believe that free financial markets would tend to optimal outcomes. Rather, markets feed on themselves, so that financial values have a permanent tendency to swing between boom and bust - they are never rational. The crash of 2008, Soros explains, was an accident waiting to happen. Recovery will require regulation that compels banks to carry more capital and lend more judiciously. But until the international financial system is fairer to the less-developed countries on "the periphery", the core of the world economy will always be at risk of being flooded by hot money fleeing from that risky periphery.
This quartet of books indict modern finance. They cannot be read without wishing for something different. Yet even now I am not sure that the politicians and officials get it. The support for British banks is disgracefully one-sided. The taxpayer will lose at least £50bn, if not £100bn, but there has been no concomitant willingness on the part of the bankers to restructure their business model - or accept that their pensions, bonuses and pay should be seriously qualified. They want to get back to the glory days, and if once in every 30 or 40 years the rest of us suffer recessions and a £100bn bill while they make personal fortunes - so be it. It is not a fair bargain. These books set out why, and how it could be changed. Read all of them.
• Will Hutton is executive vice-chair of the Work Foundation

Corporate State - in whose interests?

2009-05-05T02:59:00.000-07:00

BERR has become a cell within government that interferes with both social democracy and free markets
Comments (44)

George Monbiot
guardian.co.uk, Monday 4 May 2009 18.30 BST
Article history
There isn't much to be said for Nicholas Ridley, the most desiccated market fundamentalist in Margaret Thatcher's cabinet, but at least he was aware of the government's contradictions. When he took over the Department of Trade and Industry in 1989, he asked: "What is the DTI for? I've got bugger all to do and thousands of staff to help me do it." Thatcher's government had spent 10 years preaching that people should stand on their own two feet and that the market should be free from meddling by the state. But it ran a large department whose purpose was to nanny free enterprise.
The name has changed, to Business, Enterprise & Regulatory Reform, but the department's policies have not. I think, however, that I have an answer to Ridley's question. BERR, now run by Lord Mandelson, functions as a fifth column within government, working for corporations to undermine democracy and the public interest. Since he became business secretary in October, Mandelson has been quietly building a bonfire of the measures that protect us from predatory corporate behaviour.
You don't have to look very far to see where BERR's interests lie. Most government departments contain either one unelected minister or none. Two departments (the Foreign Office and Innovation, Universities and Skills) each accommodate two unelected ministers. But BERR has four. It is the only department of government in which unelected ministers outnumber members of parliament.
Until he became minister for communications in BERR, Lord Carter was the chief executive of Brunswick Group, a big public relations firm whose clients include British Airways, Barclays, Unilever, Rolls Royce and BT. Lord Davies, the minister for trade and investment, was chairman of Standard Chartered and a non-executive director of Tesco. Until October, the trade minister was Digby Jones, formerly the director general of the Confederation of British Industry. Lord Jones refused to join the Labour party, or to say which party he would support at the next election.
As for Lord Mandelson, who previously ranked second on Gordon Brown's execution list, the only convincing explanation for his appointment is that business demanded it. Mandelson, who once avowed that "we are intensely relaxed about people getting filthy rich" was partly responsible, both in Blair's government and as European trade commissioner, for promoting the culture of deregulation that catalysed the economic crisis. Yet even today he boasts about "a decade of reform that has given the UK the most open and flexible product and labour markets in the world".
These unelected ministers appear to have formed their own lobby group within government, to prevent those upstart parliamentarians from interfering with the democratic rights of business. They are responsible for some of the policies that now threaten to tear the Labour party apart.
Mandelson is the promoter of Labour's crazy scheme to part-privatise Royal Mail. Wildly unpopular with both the public and Labour MPs, it breaks a manifesto commitment and could provoke a parliamentary rebellion big enough to unseat the prime minister.
But most of his assaults on democracy have achieved much less attention. Last week he helped neuter the EU's working time directive by ensuring that European companies will still be able to push their employees into working for more than 48 hours a week. BERR issued a gleeful press release bragging that talks on the directive "have broken down without agreement being reached" as a result of government filibusters. Mandelson's attempt to prevent companies exploiting their female workers was less successful. The equality bill sought to audit large companies to ensure that they were not paying women less than men for the same jobs. Mandelson insisted the audits should be voluntary, and that the policy should first be approved by the CBI, which often seems to be the real government of Britain.
Last month, although it passed almost unnoticed, BERR deregulated the news distribution industry. This is a gift to the supermarkets but a disaster for both small newsagents – and for freedom of speech. The companies that distribute newspapers and magazines to the shops have historically guaranteed, in return for exclusive delivery rights, to supply whatever stock a shop requests, however small the order might be. This allowed small newsagents to survive and protected publishers from censorship by powerful retailers. (In the United States, supermarkets often dictate the contents of the magazines they sell). Tesco has been trying to break the distribution agreement since 2000; now Mandelson has delivered.
A few days ago, the Guardian revealed that BERR has set up a new unit, whose purpose appears to be to lobby another department on behalf of business. The business department relinquished its responsibility for energy policy only six months ago. Now it has created an energy and climate change unit, whose brief and title look suspiciously similar to Ed Miliband's Department for Energy and Climate Change. While Miliband gets the environment, Mandelson appears to be doing everything in his power to trash it. Over the past year he has secured £2.6bn in subsidies, loans and guarantees for the motor industry. He boasts that this is "effectively the same as underwriting the entire vehicle sector's research and development and capital expenditure for a year". He is widely blamed for the decision to build a third runway at Heathrow.
Last month BERR launched a consultation about the EU's attempts to strengthen its directives on waste electrical equipment and hazardous substances. The EU is trying to cut the amount of cyberjunk going into landfill and to prevent companies sending dead computers overseas to be dismantled by child labourers. In drafting the consultation document, Mandelson's department conferred with 10 industry bodies but no trade unions or environment or development groups.
In the strategic plan it released last month, BERR announced that it wants the government to "match … the influence it exercises in the economy to the strategic needs of business". It also wants to second even more people from the private sector into government, which is already infested with people whose public duties conflict with their commercial interests. It revealed that, as of last month, "grant applicants to all research councils will have to set out the economic impact of their proposed research". This appears to mark the end of the pursuit of knowledge for its own sake: all research, whether funded by the state or corporations, must now consider the needs of business.
Business is perfectly capable of making its own representations. It does not require a cell inside government to ensure that its voice is heard; it should compete, like the rest of us, for the attention of ministers. Mandelson's department has one legitimate function: simplifying and clarifying regulations. The others – the trade missions, the lobbying, the featherbedding – achieve the rare distinction of undermining both social democracy and free markets.
BERR now has a budget of £1.92bn, £460m bigger than it was last year. The government is looking for savings. It should close this department down.

"Bernie Madoff, Scapegoat" by Michael Moore

2009-05-05T02:58:00.000-07:00

The following piece written by Michael Moore appears in this week's Time magazine (and in full at Time.com) as part of their annual "Time 100" issue highlighting their choices for "The World's Most Influential People."
Elie Wiesel called him a "God." His investors called him a "genius." But, proving correct that old adage from the country and western song, you never really know what goes on behind closed doors.
Bernie Madoff, for at least 20 years, ran a Ponzi scheme on thousands of clients, among them the people you and I would consider the best and brightest. Business leaders, celebrities, charities, even some of his own relatives and his defense attorney were taken for a ride (this has to be the first time a lawyer was hosed by the client).
We're clearly in one of those historic, game changing years: up is down, red is blue and black is President. Aside from Obama himself, no person will provide a more iconic face of this end-of-capitalism-as-we-know-it year than Bernard Lawrence Madoff.
Which is too bad. Yes, he stole $65 billion from some already quite wealthy people. I know that's upsetting to them because rich guys like Bernie are not supposed to be stealing from their own kind. Crime, thievery, looting — that's what happens on the other side of town. The rules of the money game on Park Avenue and Wall Street are comprised of things like charging the public 29% credit card interest, tricking people into taking out a second mortgage they can't afford, and concocting a student loan system that has graduates in hock for the next 20 years. Now that's smart business! And it's legal. That's where Bernie went wrong — his scheming, his trickery was an outrage both because it was illegal and because he preyed on his side of the tracks.
Had Mr. Madoff just followed the example of his fellow top one-percenters, there were many ways he could have legally multiplied his wealth many times over. Here's how it's done. First, threaten your workers that you'll move their jobs offshore if they don't agree to reduce their pay and benefits. Then move those jobs offshore. Then place that income on the shores of the Cayman Islands and pay no taxes. Don't put the money back into your company. Put it into your pocket and the pockets of your shareholders. There! Done! Legal!
But Bernie wanted to play X-games Capitalism, run by the mantra that's at the core of all capitalistic endeavors: Enough Is Never Enough. You have the right to make as much as you can, and if people are too stupid to read the fine print of their health insurance policy or their GM "100,000-mile warranty," well, tough luck, losers. Buyers beware!
It would be too easy — and the wrong lesson learned — to put Bernie on TIME's list all by himself. If Ponzi schemes are such a bad thing, then why have we allowed all of our top banks to deal in credit default swaps and other make-believe rackets? Why did we allow those same banks to create the scam of a sub-prime mortgage? And instead of putting the people responsible in the cell block in Lower Manhattan, where Bernie now resides, why did we give them huge sums of our hard-earned tax dollars to bail them out of their self-inflicted troubles? Bernard Madoff is nothing more than the scab on the wound. He's also a most-needed and convenient distraction. Where's the photo on this list of the ex-chairmen of AIG, Merrill Lynch and Citigroup? Where's the mug shot of Phil Gramm, the senator who wrote the bill to strip the system of its regulations, or of the President who signed that bill? And how 'bout those who ran the fake numbers at the ratings agencies, the lobbyists who succeeded in making sleazy accounting a lawful practice, or the stock market itself — an institution that's treated like the Holy Sepulchre instead of the casino that it is (and, like all other casinos, the house eventually wins).
And what of Madoff's clients themselves? What did they think was going on to guarantee them incredible returns on their investments every single year — when no one else on planet Earth was getting anything like that? Some have admitted they did have an inkling "something was up," but no one really wanted to ask what it was that was making their money grow on trees. They were afraid they might find out it had nothing to do with gardening. Many of Madoff's victims have told investigators that, over the years, they have made much more than the original investment they gave Bernie. If I buy a stolen car from the guy down the street, the police will take that car from me regardless of whether I knew it was stolen. If I knew it was stolen, then I go to jail for receiving stolen property. Will these "victims" give back their gains that were fraudulently obtained? Will the head of Goldman Sachs reveal what he was doing at the meetings with the Fed chairman and the Treasury secretary before the bailout? Will Bank of America please tell us what they've spent $45 billion of our TARP money on?
That's probably going too far. Better that we just put Bernie on this list.
Moore's new documentary on the wonders of capitalism will be in movie theaters this fall.

City bankers on course for £7bn in bonuses

2009-05-01T04:13:00.000-07:00

• Payouts running at about half the level of last year
• 'Alarming' figures show no awareness of crisis – Cable

Ashley Seager
guardian.co.uk, Thursday 30 April 2009 00.05 BST
Article history
City bankers are to reap nearly £7bn in bonuses this spring even though the government has been forced to pump tens of billions into the banks to prevent them collapsing.
Analysis of preliminary pay data from the Office for National Statistics shows that in the first three months of the bonus season to February the financial sector has shared out £5bn in bonuses, half the level of the same period last year.
Extrapolating that to the full five months of the bonus season to April means payouts will be between £6.5bn and £7bn, compared with £13.7bn last year.
"These figures are alarming and show a complete lack of awareness in the City of the extent of the financial crisis, their role in creating it and the extent to which they are ultimately answerable to the taxpayer," said the Liberal Democrats' Treasury spokesman, Vince Cable. "It would be outrageous if taxpayer-supported institutions are handing out large bonuses, particularly at a time when hundreds of thousands of people are losing their jobs."
In last week's budget, Alistair Darling, revealed that borrowing would surge to £175bn this year as a result of the credit crunch and the country faced nearly a decade of rising taxes and big cuts in public spending to pay for the recession and bank bailouts.
The TUC general secretary, Brendan Barber, said: "Given the havoc that the City has wreaked on our economy, pegging back bonuses to a mere £7bn a year falls short of the value for money taxpayers should expect after bailing out the banks."
In 2008, bonuses suffered their first fall in five years as the early months of the credit crunch took their toll – but the fall was small, to £13.7bn from £14.1bn in 2007, after a 30% rise from 2006.
The low point in recent years was £5.2bn in 2003, as the financial sector recovered from the dotcom bust in the stockmarket. This year's payout will be broadly similar to that of 2004, when financial markets were in good shape.
Averaged across the whole of financial services, the bonuses would amount to £6,500 to £7,000 a head, but payouts are not evenly distributed. The City bonus pile works out at close to half the total of £12bn handed out across the whole economy between December and February.
The Bank of England governor, Mervyn King, recently told the Treasury select committee (CBI): "The real debate is how on earth was it that at the time shareholders, boards, the financial press, all thought it was a great idea to reward people in this way. These bonuses were absolutely astronomic." He called bonuses "a form of compensation that rewarded gamblers if they won the gamble but there was no loss if you lost it".
A CBI spokesperson said: "Bonuses given for hard work and success are not a problem. But the link between incentives and long-term performance needs to be strengthened."

Matthew Norman: Another police fiasco to divert attention from the last one

2009-04-29T03:12:00.000-07:00

Seldom since September 11 2001 has there been a better day than Wednesday for the burial of bad news. With the Chancellor borrowing from compatriot Private Frazer, an undertaker himself, to tell us we're all doomed (I paraphrase the Budget very slightly), the announcement that a huge meteor was on course to disrupt the London Marathon on Sunday would have passed by barely noticed.
If Jacqui Smith had coughed to claiming £120,000 for being impregnated with a foetus cloned from Osama bin Laden in a Torinese clinic, it would have been lost. Had it emerged that Gordon Brown has signed up for a sex change, followed by extensive cosmetic surgery and the loss of his legs below the knee, in the cause of becoming a Susan Boyle tribute act (the only way, according to leading pundits, he could win an election), it might have made a two-paragraph brief on page 27.
Consider yourselves forgiven, then, if the trumpets of the Four Horsemen of the Fiscal Apocalypse drowned out the noise of a less sensational news cadaver being lowered into the ground with half the ceremony lavished on Eleanor Rigby... the very bad, if unstartling, news that the British police have contrived another colossal fiasco.
As it proudly takes its place on the honours board of terrorist-related policing calamity, alongside the "Ricin plot" sans Ricin, the "airline bomb plot" involving no airliners, the "London Underground cyanide plot" devoid of cyanide and aimed at no Tube trains, and the shooting of an innocent Muslim in east London technically known as Forest GateGate, please give a warm, Independent readers' welcome to the "Easter bomb plot" with nothing to do with Easter and not the hint of an explosive.
The special appeal about this one is its exquisite symmetry. The arrests of a dozen Muslim men, 11 Pakistanis here on student visas and a lone British national, were rushed through on 9 April in the wake of former Assistant Commissioner Bob Quick's little faux pas with that top secret folder as he strode manfully towards Number 10.
Given that all 12 have now been released without charge, we ask ourselves why Mr Quick was in Downing Street at all. And the odds-on 2-9 favourite, we answer, is that the Government and Scotland Yard were desperate to flam up a "police triumph" story to divert outrage from the possible manslaughter of Ian Tomlinson at the G20 protest.
And a triumph, for a while at least, it was. Gordon was thrilled to bits by Operation Pathway, lauding the police for foiling what he assured us, with neo-Blunkettian contempt for the basic precepts of natural justice, was a "very big terrorist plot". So big, it transpires, that the police and security services, these brethren defenders of life and liberty now engaged in a ferocious game of buck-passing, had amassed zero evidence. Houses, cars and computers were searched, and not a carrot found.
Apparently there'd been a tip-off from our spooks in Pakistan, which is nice, although ever since MI6 failed to predict the collapse of Soviet Communism, common sense suggests their intelligence be handled with giant tongs. One person's common sense is another's venal cynicism, of course, and the security world's faith in its own competence does credit to its trusting nature, if only towards itself.
Now although we cannot be certain that these men were harmless, their release after less than a fortnight, when the law now allows suspects to be held for 28 days, entitles us to make the presumption; just as we may assume that they were arrested, despite being under 24-hour surveillance that had unearthed no imminent "bomb plot", to remove Mr Tomlinson's death from the front pages; and just as we must suspect that the timing of their release, on the eve of the Budget, was more than coincidence.
The creation of a fresh policing catastrophe in the attempt to divert public fury from a previous one is, as I said, gorgeously symmetrical. If royalprotection officers had shot Prince Philip to deflect attention from their failure to keep Michael Fagan out of the Queen's bedroom, that would have done the trick too, but again you'd have wondered whether the game was worth the candle.
Yet however inured we've become to ministers and a frighteningly politicised police force crying wolf (you will recall the pre-election ringing of Heathrow with tanks for no other apparent reason than electoral gain), we cannot become blasé about the blithe vindictiveness that underscores this case.
Bending over backwards to be charitable, one might read the "Easter bomb plot" arrests as nothing more sinister than a loss of nerve... the blind terror, in a risk-averse world, that waiting to collect some evidence could lead to loss of life. It's very easy to be smug, sat behind a computer screen, about the nervous nelliedom of those responsible for keeping us safe. It isn't so easy, in truth, to imagine how men being followed round the clock, their phones and emails perpetually bugged, could hurriedly activate the plot to detonate so much as a stink bomb.
Lord Carlile, the independent reviewer of terrorism legislation, has promised a "snapshot review" of Operation Pathway, and if he sees fit to publish it perhaps we will learn more about the mechanics of this cock-up. Whatever his findings, however, and without excusing the evidently political nature of the timing or ignoring the damage all this premature incarceration does to relations with a justifiably livid and suspicious Muslim community, one does understand the general temptation to err on the side of caution.
What is utterly unforgivable is that the 11 Pakistanis have been released into not freedom but the unlovely arms of the immigration service, which will seek to deport them on the familiar catch that they are, in some nebulous manner of which they have no legal right to be informed so that they might defend themselves against the charge, a threat to national security. Having tainted them with the McBridean smear that they are would-be killers with his "very big terrorist plot" gibberish, in other words, Gordon Brown means to use their deportation as no-smoke-without-fire cover for a grave mistake in which he was complicit.
If an apology and compensation for their wrongful detention is an outlandish expectation from a government whose paramount concern remains the opinion of right wing tabloids, is it too much to ask that these chaps be spared the persecution they can, having been condemned as terrorists by a British PM, count on back in Pakistan?
Apparently it is. For far too long, idiots like myself have given Gordon Brown the benefit of every doubt, ever qualifying attacks on his abysmal leadership, relentless machine politician bullying and abundant cowardice in the line of fire with the rider that at least he, unlike his predecessor, is at heart a well-intentioned man. The sacrifice of these innocents to spare his blushes makes this a very good day to bury that credulous misjudgment in a concrete-lined coffin, never to be disinterred.
s.richards@independent.co.uk

Robert Brenner on the crisis: "The Economy in a World of Trouble"

2009-04-29T03:11:00.000-07:00

The basic source of today’s crisis is the declining vitality of the advanced economies since 1973, and, especially, since 2000. Economic performance in the United States, western Europe, and Japan has steadily deteriorated, business cycle by business cycle in terms of every standard macroeconomic indicator — GDP, investment, real wages and so forth. Most telling, the business cycle that just ended, from 2001 through 2007, was — by far — the weakest of the postwar period, and this despite the greatest government-sponsored economic stimulus in U.S. peacetime history.
SJ: How would you explain the long-term weakening of the real economy since 1973, what you call in your work “the long downturn”?
RB: What mainly accounts for it is a deep, and lasting, decline of the rate of return on capital investment since the end of the 1960s. The failure of the rate of profit to recover is all the more remarkable, in view of the huge drop-off in the growth of real wages, over the period.
The main cause, though not the only cause, of the decline in the rate of profit has been a persistent tendency to overcapacity in global manufacturing industries. What happened was that one after another new manufacturing power entered the world market — Germany and Japan, the northeast Asian Newly Industrializing Countries (NICS), the southeast Asian Tigers, and, finally the Chinese Leviathan.
These later-developing economies produced the same goods that were already being produced by the earlier developers, only cheaper. The result was too much supply compared to demand in one industry after another, and this forced down prices and in that way profits. The corporations that experienced the squeeze on their profits, moreover, did not meekly leave their industries; they tried to hold their place by falling back on their capacity for innovation and speeding up investment in new technologies. But of course this only made overcapacity worse.
Due to the fall in their rate of return, capitalists were getting smaller surpluses from their investments. They therefore had no choice but to slow down the growth of plant and equipment and employment. At the same time, in order to restore profitability, they held down employees’ pay, while governments reduced the growth of social expenditures.
But the consequence of all these cutbacks in spending has been a long-term problem of aggregate demand. The persistent weakness of aggregate demand has been the immediate source of the economy’s long-term weakness.
SJ: The crisis was actually triggered by the bursting of the historic housing bubble, which had been expanding for a full decade. What is your view of its significance?
RB: The housing bubble needs to be understood in relation to the succession of asset price bubbles that the economy has experienced since the middle 1990s, and especially the role of the U.S. Federal Reserve in nurturing those bubbles.
Since the start of the long downturn, state economic authorities have tried to cope with the problem of insufficient demand by encouraging the increase of borrowing, both public and private. At first they turned to state budget deficits, and in this way they did avoid really deep recessions. But as time went on, governments could get ever less growth from the same amount of borrowing. In effect, in order to stave off the sort of profound crises that historically have plagued the capitalist system, they had to accept a slide toward stagnation.
During the early 1990s, governments in the United States and Europe, led by the Clinton administration, famously tried to break their addiction to debt by moving together toward balanced budgets. The idea was to let the free market govern the economy. But because profitability had still not recovered, the reduction in deficits delivered a big shock to demand, and helped bring about the recessions and slow growth between 1991 and 1995.
To get the economy expanding again, U.S. authorities ended up adopting an approach that had been pioneered by Japan during the later 1980s. By keeping interest rates low, the Federal Reserve made it easy to borrow so as to encourage investment in financial assets. As asset prices soared, corporations and households experienced huge increases in their wealth, at least on paper. They were therefore able to borrow on a titanic scale, vastly increase their investment and consumption, and in that way drive the economy.
So, private deficits replaced public ones. What might be called “asset price Keynesianism” replaced traditional Keynesianism. We have therefore witnessed for the last dozen years or so the extraordinary spectacle of a world economy in which the continuation of capital accumulation has come literally to depend upon historic waves of speculation, carefully nurtured and rationalized by state policy makers — and regulators! — first the historic stock market bubble of the later 1990s, then the housing and credit market bubbles from the early 2000s.
SJ: You were prophetic in forecasting the current crisis as well as the 2001 recession. What is your outlook for the global economy? Will it worsen, or will it recover before the end of 2009? Do you expect that the current crisis will be as severe as the Great Depression?
RB: The current crisis is more serious than the worst previous recession of the postwar period, between 1979 and 1982, and could conceivably come to rival the Great Depression, though there is no way of really knowing. Economic forecasters have underestimated how had bad it is because they have overestimated the strength of the real economy and failed to take into account the extent of its dependence upon a buildup of debt that relied on asset price bubbles.
In the United States, during the recent business cycle of the years 2001-2007, GDP growth was by far the slowest of the postwar epoch. There was no increase in private sector employment. The increase in plant and equipment was about a third off the previous postwar low. Real wages were basically flat. There was no increase in median family income for the first time since WWII. Economic growth was driven entirely by personal consumption and residential investment, made possible by easy credit and rising house prices.
Economic performance was this weak, despite the enormous stimulus from the housing bubble and the Bush administration’s huge federal deficits. Housing by itself accounted for almost one-third of the growth of GDP and close to half of the increase in employment in the years 2001-2005. It was therefore to be expected that when the housing bubble burst, consumption and residential investment would fall, and the economy would plunge.
SJ: Many assert that the current crisis is a typical financial crisis, not a “Marxian” one of overproduction and falling profit, arguing that the financial speculation-bubble-bust has played the central role in this crisis. How would you respond?
RB: I don’t think it’s helpful to counterpose in that way the real and financial aspects of the crisis. As I emphasized, it is a Marxian crisis in that it finds its roots in a longterm fall and failure to recover the rate of profit, which is the fundamental source of the extended slowdown of capital accumulation right into the present. In 2001, the rate of profit for U.S. non-financial corporations was the lowest of the postwar period, except for 1980. Corporations therefore had no choice but to hold back on investment and employment, further darkening the business climate.
This is what accounts for the ultra-slow growth during the business cycle that just ended. Nevertheless, to understand the current collapse, you have to demonstrate the connection between the weakness of the real economy and the financial meltdown. The main link is the economy’s ever-increasing dependence on borrowing to keep it turning over, and the government’s ever greater reliance on asset price run-ups to allow that borrowing to continue.
The basic condition for the housing and credit market bubbles was the perpetuation of low costs of borrowing. The weakness of the world economy, especially after the crises of 1997-1998 and 2001-2002, plus East Asian governments’ huge purchases of dollars to keep their currencies down and U.S. consumption growing, made for unusually low longterm interest rates. At the same time, the U.S. Fed kept short-term interest rates lower than at any time since the 1950s. Because they could borrow so cheaply, banks were willing to extend loans to speculators, whose investments drove the price of assets of every type ever higher and the return on lending (interest rates on bonds) ever lower.
Symptomatically, housing prices soared and the yield in real terms on U.S. treasury bonds plunged. But because yields fell ever lower, institutions the world over that depended on returns from lending had an ever more difficult time making sufficient profits. Pension funds and insurance companies were particularly hard hit, but hedge funds and investment banks were also affected.
These institutions were therefore all too ready to make massive investments in securities backed by highly dubious sub-prime mortgage, because of the unusually high returns they offered, ignoring their unusually high risk. In fact, they could not get enough of them. Their purchases of mortgage-backed securities allowed mortgage originators to keep lending to ever less qualified borrowers. The housing bubble reached historic proportions, and the economic expansion was allowed to continue.
Of course, this could not go on for very long. When housing prices fell, the real economy went into recession and the financial sector experienced a meltdown, because both had depended for their dynamism on the housing bubble. Today, the recession is making the meltdown worse because it is exacerbating the housing crisis. The meltdown is intensifying the recession because it is making access to credit so difficult. It is the mutually reinforcing interaction between the crises in the real economy and financial sector that has made the downward slide so intractable for policymakers, and the potential for catastrophe so evident.
SJ: Even if one grants that postwar capitalism entered a period of long downturn in the 1970s, it seems undeniable that the neoliberal capitalist offensive has prevented the worsening of the downswing since the 1980s.
RB: If you mean by neoliberalism the turn to finance and deregulation, I do not see how it helped the economy. But if you mean the stepped-up assault by employers and governments on workers’ wages, working conditions, and the welfare state, there can be little doubt that it prevented the fall in the rate of profit from getting worse.
Even so, the employers’ offensive did not wait until the so-called neoliberal era of the 1980s. It began in the wake of the fall of profitability, starting in the early 1970s, along with Keynesianism. Moreover, it did not result in a recovery of the rate of profit, and only further exacerbated the problem of aggregate demand. The weakening of aggregate demand ultimately impelled economic authorities to turn to more powerful and dangerous forms of economic stimulus, the “asset price Keynesianism” that led to the current disaster.
SJ: Some have argued that a new paradigm of “financialization” or “finance-led capitalism” has sustained a so-called “Capital Resurgent” (Gerard Dumenil) between the 1980s and the present. What do you think of such a thesis?
RB: The idea of a finance led-capitalism is a contradiction in terms, because, speaking generally — there are significant exceptions, like consumer lending — sustained financial profit-making depends on sustained profit-making in the real economy. To respond to the fall in the rate of profit in the real economy, some governments, led by the United States, encouraged a turn to finance by deregulating the financial sector. But because the real economy continued to languish, the main result of deregulation was to intensify competition in the financial sector, which made profit making more difficult and encouraged ever greater speculation and risk taking.
Leading executives in investment banks and hedge funds were able to make fabulous fortunes, because their salaries depended on short-run profits. They were able to secure temporarily high returns by expanding their firms’ assets/lending and increasing risk. But this way of doing business, sooner or later, came at the expense of the executives own corporations’ long-term financial health, most spectacularly leading to the fall of Wall Street’s leading investment banks.
Every so-called financial expansion since the 1970s very quickly ended in a disastrous financial crisis and required a massive bailout by the state. This was true of the third-world lending boom of the 1970s and early 1980s; the savings and loan runup, the leveraged buyout mania, and the commercial real estate bubble of the 1980s; the stock market bubble of the second half of the 1990s; and of course the housing and credit market bubbles of the 2000s. The financial sector appeared dynamic only because governments were prepared to go to any lengths to support it.
SJ: Keynesianism or statism seems poised to return as the new Zeitgeist. What is your general assessment of resurgent Keynesianism or statism? Can it help to resolve, or at least, alleviate the current crisis?
RB: Governments today really have no choice but to turn to Keynesianism and the state to try to save the economy. After all, the free market has shown itself totally incapable of preventing or coping with economic catastrophe, let alone securing stability and growth. That’s why the world’s political elites, who only yesterday were celebrating deregulated financial markets, are suddenly now all Keynesians.
But there is reason to doubt that Keynesianism, in the sense of huge government deficits and easy credit to pump up demand, can have the impact that many expect. After all, during the past seven years, thanks to the borrowing and spending encouraged by the Federal Reserve’s housing bubble and the Bush administration’s budget deficits, we witnessed in effect probably the greatest Keynesian economic stimulus in peacetime history. Yet we got the weakest business cycle in the postwar epoch.
Today the challenge is much greater. As the housing bubble collapses and credit becomes harder to come by, households are cutting back on the consumption and residential investment. As a consequence, corporations are experiencing falling profits. They are therefore cutting back on wages and laying off workers at a rapid pace, detonating a downward spiral of declining demand and declining profitability.
Households had long counted on rising house prices to enable them to borrow more and to do their saving for them. But now, because of the buildup of debt, they will have to reduce borrowing and increase saving at the very time that the economy most needs them to consume. We can expect that much of the money that the government places in the hands of households will be saved, not spent. Since Keynesianism could barely move the economy during the expansion, what can we expect from it in the worst recession since the 1930s?
To have a significant effect on the economy, the Obama administration will likely have to contemplate a huge wave of direct or indirect government investment, in effect a form of state capitalism. To actually accomplish this however would require overcoming enormous political and economic obstacles.
The U.S. political culture is enormously hostile to state enterprise. At the same time, the level of expenditure and state indebtedness that would be required could threaten the dollar. Until now, East Asian governments have been happy to fund U.S. external and government deficits, in order to sustain U.S. consumption and their own exports. But with the crisis overtaking even China, these governments may lose the capacity to finance U.S. deficits, especially as they grow to unprecedented size. The truly terrifying prospect of a run on the dollar looms in the background.
SJ: What is your general assessment of the victory of Obama in the last Presidential election? Many regard Obama as a F.D.R. of the 21st century who wll bring a “new New Deal.” Do you think the anti-capitalist progressives can give critical support to some of his policies?
RB: The triumph of Obama in the election is to be welcomed. A victory for McCain would have been a victory for the Republican Party and given an enormous boost to the most reactionary forces on the U.S. political scene. It would have been seen as an endorsement of the Bush administration’s hyper-militarism and imperialism, as well as its explicit agenda of eliminating what is left of unions, the welfare state, and environmental protection.
That said, Obama is, like Roosevelt, a centrist Democrat who cannot be expected on his own to do much to defend the interests of the vast majority of working people, who will be subjected to an accelerating assault from corporations trying to make up for their collapsing profits by reducing employment, compensation, and so forth.
Obama's backed the titanic bailout of the financial sector, which represents perhaps the greatest robbery of the U.S. taxpayer in American history, especially as it came with no strings attached for the banks. He also supported the bailout of the auto industry, even though it is conditional on massive cuts in the compensation of auto workers.
The bottom line is that, like Roosevelt, Obama can be expected to take decisive action in defense of working people only if he is pushed by way of organized direct action from below. The Roosevelt administration passed the main progressive legislation of the New Deal, including the Wagner Act and the Social Security, only after it was pressured to do so by a great wave of mass strikes. We can expect the same from Obama.Crisis and Expansion
SJ: According to Rosa Luxemburg and recently David Harvey, capitalism overcomes its tendency to crisis by way of geographical expansion. According to Harvey, this is often facilitated by massive state investments in infrastructure, to back up private capital investment, often foreign direct investment. Do you think that capitalism can find an exit from the current crisis, in Harvey’s terminology, by way of a “temporal-spatial” fix?
RB: This is a complex issue. I think, first of all, it’s true and critically important to say that geographical expansion has been essential to every great wave of capital accumulation. You might say that growth of the size of the labor force and growth of the system’s geographical space are the essentials for capitalist growth. The postwar boom is a good example, spectacular expansions of capital into the U.S. south and southwest and into war-torn western Europe and Japan.
Investment by U.S. corporations played a critical role, not only in United States but in western Europe in this epoch. Without question, this expansion of the labor force and the capitalist geographical arena was indispensable for the high profit rates that made the postwar boom so dynamic. From a Marxist standpoint, this was a classical wave of capital accumulation and, necessarily, entailed both sucking in huge masses of labor from outside the system, especially from the pre-capitalist countryside in Germany and Japan, and the incorporation or re-incorporation of additional geographical space on a huge scale.
Nevertheless, I think that by and large the pattern of the long downturn, since the late 1960s and early 1970s, has been different. It is true that capital responded to falling profitability by further expansion outward, seeking to combine advanced techniques with cheap labor. East Asia is of course the fundamental case, and unquestionably represents a world-historical moment, a fundamental transformation, for capitalism.
Yet even though expansion into East Asia represented a response to falling profitability, it has not, I think, constituted a satisfactory solution. At the end of the day, the new manufacturing production that emerged so spectacularly in East Asia is to a great extent duplicating the manufacturing production already taking place elsewhere, though more cheaply. On a system-wide scale, it’s exacerbating not resolving the problem of overcapacity.
In other words, globalization has been a response to falling profitability, but because its new industries are basically not complementary for the world division of labor, but redundant, you have had a continuation of the problem of profitability.
To actually resolve the problem of profitability that has so long plagued the system — slowing capital accumulation and calling forth ever greater levels of borrowing to sustain stability — the system requires the crisis that has so long been postponed. Because the problem is overcapacity, massively exacerbated by the buildup of debt, what is still required, as in the classical vision, is a shakeout from the system of high-cost low-profit firms, the subsequent cheapening of means of production, and the reduction of the price of labor.
It’s by way of crisis that capitalism historically has restored the rate of profit and established the necessary conditions for more dynamic capital accumulation. During the postwar period, crisis has been warded off, but the cost has been a failure to revive profitability, leading to worsening stagnation. The current crisis is about that shakeout that never happened.
SJ: So you think that only the crisis can resolve the crisis? That’s a classical Marxian answer.
RB: I think that that is probably the case. The analogy would be this. At first, in the early 1930s, the New Deal and Keynesianism were ineffective. In fact, through the length of the 1930s, there was a failure to establish the conditions for a new boom, as was demonstrated when the economy fell back into the deep recession of 1937-1938. But eventually, as a result of the long crisis in the ‘30s, you shook out the high-cost, low-profit means of production, creating the basic conditions for high rates of profit.
By the end of the 1930s, you could say that the potential rate of profit was high and all that was missing was a shock to demand. That demand was provided of course by the massive spending on armaments for World War II. So during the war, you got high rates of profit and those high rates of profit provided the necessary condition for the postwar boom. But I don’t think that Keynesian deficits could have worked even if they had been tried in 1933, because you needed, in Marxian terms, a system-cleansing crisis first.
SJ: Do you think that the current crisis will lead to a challenge to U.S. hegemony? World-system theorists, like Immanuel Wallerstein, who was also interviewed for this newpaper Hankyoreh, are arguing that the hegemony of U.S. imperialism is declining.
RB: This is again a very complex question. Perhaps I am mistaken, but I think that many of those who believe that there has been a decline in U.S. hegemony basically view it as mainly an expression of U.S. geopolitical power, and in the end, force. From this standpoint, it’s mainly U.S. dominance that makes for leadership, it’s U.S. power over and against other countries that keeps the United States on top.
I don’t see U.S. hegemony that way. I see the elites of the world, especially the elites of the capitalist core broadly conceived, as being very happy with U.S. hegemony because what it means for them is that the United States assumes the role and the cost of world policemen. This is true, I think, of the elites even of most poor countries today.
What’s the goal of the U.S. world policeman? Not to attack other countries — mainly, it’s to keep social order, to create stable conditions for global capital accumulation. Its main purpose is to wipe out any popular challenges to capitalism, to support the existing structures of class relations.
For most of the postwar period, there were nationalist-statist challenges, especially from below, to the free rein of capital. They unquestionably were met by the most brutal U.S. force, the most naked expressions of U.S. domination. Although within the core of the system there was U.S. hegemony [meaning general consensus, enforced by the threat of military power only in the final analysis — ed.], outside of it there was dominance by violence.
But with the fall of the Soviet Union, China and Vietnam taking the capitalist road, and the defeat of national liberation movements in places like southern Africa and Central America, resistance to capital in the developing world was very much weakened, at least for the time being. So today, the governments and elites not only of western and eastern Europe, Japan and Korea, but also Brazil, India and China — most anyplace you can name — would prefer the continuation of U.S. hegemony.
U.S. hegemony will not fall because of the rise of another power capable of contending for world domination. Above all, China prefers U.S. hegemony. The United States is not planning to attack China and, until now, has kept its market wide open to Chinese exports. With the U.S. world policeman ensuring ever freer trade and capital movements, China has been allowed to compete in terms of cost of production, on an equal playing field, and this has been incredibly beneficial to China — it couldn’t be better.
Can U.S. hegemony continue in the current crisis? This is a much harder question. But I think that, in the first instance, the answer is yes. The world’s elites want more than anything to sustain the current globalizing order, and the United States is key to that. None of the world’s elites are trying to exploit the crisis, or the United States’ enormous economic problems, to challenge its hegemony.
China keeps saying, “we’re not going to continue to pay for the U.S. to continue its profligate ways,” referring to the way that China covered record-breaking U.S. current account deficits during the past decade and to the titanic U.S. budget deficits now being created. Do you think China has now cut the United States off? Not at all. China is still pouring in as much money as it can to try to keep the U.S. economy going, so that China can keep developing the way it did.
Of course, what is desired is not always possible. The depth of the Chinese crisis may be so great that it can no longer afford to finance U.S. deficits — or the ballooning of those deficits and printing of money by the Federal Reserve could lead to the collapse of the dollar, detonating true catastrophe.
If those things happened, there would have to be a construction of a new order. But under conditions of deep crisis that would be extremely difficult. Indeed, under such conditions, the United States as well as other states could easily turn to economic protection, nationalism and even war. I think, as of this moment, that the elites of the world still are trying to avoid this — they are not ready for it. What they want is to keep markets open, keep trade open.
They understand that the last time states resorted to protection to solve the problem was at the time of the Great Depression, and this made the depression way worse, because in effect when some states started to protect, everybody moved to protection, and the world market closed down. Next, of course, came militarism and war. The closing of world markets would obviously be disastrous today, so elites and governments are doing their very best to prevent a protectionist, statist, nationalist, militarist outcome.
But politics is not just an expression of what the elites want, and what elites want changes over time. Elites are, moreover, generally divided and politics has autonomy. So, for example, it can hardly be ruled out that, if the crisis gets very bad — which at this point would not be a big surprise — you could see a return of far-right politics of protectionism, militarism, anti-immigration, nationalism.
This sort of politics not only could have broad popular appeal. Growing sections of business might find it the only way out, as they see their markets collapse, see the system in depression, see a need for protection from competition and state subsidies of demand by way of military spending. This was, of course, the response that prevailed in much of Europe and Japan during the crisis of the interwar period. Today, the right is on its heels, because of the failures of the Bush administration and because of the crisis. But, if the Obama administration is unable to counter the economic collapse, the right could easily come back…especially because the Democrats are really offering no ideological alternative.The Situation in Asia
SJ: You spoke about a potential crisis in China. What do you think of the current state of Chinese economy?
RB: I think the Chinese crisis is going to be a lot worse than people expected, for two main reasons. The first is that the American crisis, and the global crisis more generally, is much more serious than people expected, and in the last analysis the fate of the Chinese economy is inextricably dependent on the fate of the U.S. and global economy. This is not only because China has depended to such a great extent on exports to the U.S. market. Most of the rest of the world is also so dependent on the United States, and that especially includes Europe.
If I’m not mistaken, Europe recently became China’s biggest export market. But, as the crisis originating in the United States brings down Europe, Europe’s market for Chinese goods will also contract. So the situation for China is much worse than what people expected, because the economic crisis is much worse than people expected.
Secondly, in people’s enthusiasm for what has been China’s truly spectacular economic growth, they have ignored the role of bubbles in driving the Chinese economy. China has grown, basically by way of exports, and particularly a growing trade surplus with the United States. Because of this surplus, the Chinese government has had to take political steps to keep the Chinese currency down and Chinese manufacturing competitive. Specifically, it has bought up dollar-denominated assets on a titanic scale by printing massive amounts of the renminbi, the Chinese currency. But the result has been to inject huge amounts of money into the Chinese economy, making for ever easier credit over a long period.
On the one hand, enterprises and local governments have used this easy credit to finance massive investment. But this has made for ever greater overcapacity. On the other hand, they have used the easy credit to buy land, houses, shares and other sorts of financial assets. But this has made for massive asset price bubbles, which have played a part, as in the United States, in allowing for more borrowing and spending.
As the Chinese bubbles bust, the depth of the overcapacity will be made clear. As the Chinese bubbles bust, you will also have, as across much of the rest of the world, a huge hit to consumer demand and disruptive financial crisis So, the bottom line is that the Chinese crisis is very serious, and could make the global crisis much more severe.
SJ: So you think the capitalist logic of overproduction is also applied to China?
RB: Yes, just as in Korea and much of East Asia in later the ‘90s. It’s not that dissimilar. The only thing that hasn’t happened yet is the kind of revaluation of the currency that really killed the Korean manufacturing expansion. The Chinese government is doing everything to avoid that.
SJ: Then you do not agree with characterizing Chinese society as a kind of non-capitalist market economy.
RB: Not at all.
SJ: So you think China is currently capitalist?
RB: I think it’s fully capitalist. You might say that China had a market non-capitalist economy maybe through the ‘80s, when they had very impressive growth by means of the town and village enterprises (TVEs). They were publicly owned, owned by local governments, but operated on a market basis. That economic form, you might say, initiated the transition to capitalism. So perhaps up to maybe the early ‘90s it was still a kind of non-capitalist market society, especially because there was still such a big industrial sector owned and planned by the central state. But from that point on there was a transition to capitalism, which has certainly by now been completed.
SJ: What do you think of the severity of the coming Korean economic crisis? Do you think it could be more severe than the IMF crisis of 1997-1998? In order to cope with the coming crisis, the Lee Myung-bak government is now reviving Park Chung-hee style state-led investment for the construction of huge social infrastructure, especially Korean peninsula’s “Great Canal”, while copying Obama’s green growth policies. However, Lee Myung-bak’s government still tries to stick to the neoliberal deregulation policies of the post-1997 crisis period, especially by turning to the U.S.-Korea free trade agreement. You might call this a hybrid approach, combining what seems to be an anachronist return to a Park Chung-hee style state-led method of development with contemporary neoliberalism. Will it be effective in combating or alleviating the coming crisis?
RB: I’m doubtful that it will be effective. This is not necessarily either because it represents a throwback to Park’s state-led organized capitalism or because it embraces neoliberalism. It is because, whatever its internal form, it continues to depend on globalization at a time when the global crisis is bringing about an extraordinary contraction of the world market. We were just talking about China, and I was arguing that China is likely to be in serious trouble. But China has low wages, potentially a huge domestic market, so over time it conceivably could have a better shot than Korea of confronting the crisis, though I’m far from sure about this.
Korea, I think, will be hard hit. It was hard hit in 1997-1998, but saved by the U.S. stock market bubble and the resulting growth of U.S. borrowing, spending and imports. But, when the Wall Street stock market bubble burst in 2000-2002, Korea went into what promised to be an even more serious crisis than 1997-1998. Nevertheless, the U.S. housing bubble came to the rescue of Korea during the recent period; now the second U.S. bubble has collapsed, and there’s no third bubble to get Korea out of the current crisis.
It’s not necessarily because Korea is doing the wrong thing. It’s because I don’t think there’s going to be an easy way out for any part of what has become a truly global, interdependent capitalist system.
SJ: So what you are saying is that external environment is far worse than ever before.
RB: That’s the main point.
SJ: What then are the urgent tasks of progressives in Korea? Korean progressives are very critical of Lee Myung-bak, because Lee is very reactionary. They usually support the growth of the welfare-state and redistribution of income as an alternative to Lee’s project of investing in Canal construction, of big social overhead capital. This is the hot issue in Korean society today. Korean progressives point out that although Lee Myung-bak talks about green growth, his construction project would destroy whole environments. Do you agree with them?
RB: We should oppose such ecologically-disastrous projects.
SJ: Do you think that building a Swedish-type welfare state would be the reasonable strategy for Korean progressives in the midst of the economic crisis?
RB: I think the most important thing Korean progressives could do would be to re-strengthen the organizations of Korean labor. Only by rebuilding the Korean working-class movement could the left build the power that it needs to win whatever demands it’s advocating. The only way that working people can really develop their power is through building new organizations in the course of struggle, and it’s only in the course of struggle that they are likely to come to a progressive politics, or indeed decide what a progressive politics actually should be at this moment.
I think the best way to forge a left political response today is to help the people most affected to gain the organization and power to decide what’s collectively in their interest. So, rather than try to figure out now, from above in a technocratic way, what’s the best answer, the key for the left is to catalyze the reconstitution of the power of working people.
The Korean labor movement has obviously been weakened a great deal since the crisis of 1997-1998. At minimum, the priority for progressives is to do what they can to improve the environment for labor organizing, for re-strengthening the unions right now. That goes not only for Korea, but everywhere around the world. That’s the key objective. Without the revival of working-class power, the left will quickly find that most issues of government policy are truly academic. I mean if the left is to affect state policy, there must be a change, a big change, in the balance of class power.
SJ: Do you expect that there will be an opening for progressives in a world with recent failures of neoliberalism?
RB: The defeat of neoliberalism is definitely creating major opportunities that the left did not have before. Neoliberalism never much appealed to large parts of the population. Working people never identified with free markets, free finance and all that. But I think that large sections of the population were convinced of TINA, “There Is No Alternative.”
But now the crisis has revealed the total bankruptcy of the neoliberal mode of economic organization, and you can already see the change very powerfully manifested in the opposition by American working people to the bail-outs for the banks and financial sector. People are saying today is that “We are told that saving the financial institutions, the financial markets, is the key to restoring the economy, prosperity. But we don’t believe it. We don’t want any more of our money going to these people who are just robbing us.”
There is an ideological vacuum, consquently there is an opening for left ideas. The problem is that there is very little organization of working people, let alone any political expression. One can say there is a big opportunity created by the change in the political environment, or the ideological climate, but by itself that will not provide a progressive outcome.
So once again, the top priority for progressives — for any left activists — to be active is in trying to revive the organizations of working people. Without the recreation of working- class power, little progressive change will be possible, and the only way to recreate that power is through mobilization for direct action. Only through working people taking collective mass action will they be able to create the organization and the power necessary to provide the social basis for a transformation of their own consciousness, for political radicalization.

A criminally stupid war on drugs

2009-04-21T03:25:00.001-07:00

By Clive Crook
Published: April 12 2009 17:41 Last updated: April 12 2009 17:41
How much misery can a policy cause before it is acknowledged as a failure and reversed? The US “war on drugs” suggests there is no upper limit. The country’s implacable blend of prohibition and punitive criminal justice is wrong-headed in every way: immoral in principle, since it prosecutes victimless crimes, and in practice a disaster of remarkable proportions. Yet for a US politician to suggest wholesale reform of this brainless regime is still seen as an act of reckless self-harm.
Even a casual observer can see that much of the damage done in the US by illegal drugs is a result of the fact that they are illegal, not the fact that they are drugs. Vastly more lives are blighted by the brutality of prohibition, and by the enormous criminal networks it has created, than by the substances themselves. This is true of cocaine and heroin as well as of soft drugs such as marijuana. But the assault on consumption of marijuana sets the standard for the policy’s stupidity.
Nearly half of all Americans say they have tried marijuana. That makes them criminals in the eyes of the law. Luckily, not all of them have been found out – but when one is grateful that most law-breakers go undetected, there is something wrong with the law.
Harvard’s Jeffrey Miron published a study denouncing drug prohibition in 2004*. He noted that more than 300,000 people were then in US prisons for violations of the law on drugs – more than the number incarcerated for all crimes in Britain, France, Germany, Italy and Spain combined. Today the number is higher – according to some estimates, nearly 500,000. The far larger number of people who have been convicted, at any point, of a drugs offence face permanently impaired employment prospects and all manner of other setbacks: in the US, once a criminal always a criminal.
Strict enforcement, Mr Miron explained, has reduced drug use only modestly – supposing for the moment that this is even a legitimate objective. The collateral damage is of a different order altogether. Violence related to drug crimes has surged in Mexico and in US cities close to the border, giving rise to renewed interest in the topic. Thousands are thought to have been killed by criminal gangs competing for the trade.
Many users also die because of tainted drugs, or because they share needles – consequences again of prohibition. There is an obvious national security dimension as well: in countries such as Colombia and Afghanistan, the huge surplus derived from prohibition supports terrorists.
The consequences of prohibition corrupt governments everywhere, and the US is no exception. Since a drug transaction has no victims in the ordinary sense, witnesses to assist a prosecution are in short supply. US drug-law enforcement tends to infringe civil liberties, relying on warrantless searches, entrapment, extorted testimony in the form of plea bargains, and so forth. Predictably, in the US the hammer of the law on drugs falls with far greater force on black people: whites do most of the using, blacks do most of the time.
Few policies manage to fail so comprehensively, and what makes it all the odder is that the US has seen it all before. Everybody understands that alcohol prohibition in the 1920s suffered from many of the same pathologies – albeit on a smaller scale – and was eventually abandoned.
The present treatment of alcohol, which is to regulate and tax the product, is the right approach for today’s illegal drugs. One could expect some increase in the use of the drugs in question, but also an enormous net reduction in the harms that they and the attempt to prohibit them cause. Adding the direct costs of prohibition (police and prisons) to the taxes forgone by the present system, the US could also expect a fiscal benefit of about $100bn (€75.7bn, £68.2bn) a year.
Is an outbreak of common sense on this subject likely? Unfortunately, no. Only the most daring politicians seem willing to think about it seriously. One such is James Webb, a refreshingly unpredictable Democratic senator for Virginia, who has called for a commission to examine the criminal justice system and the law on drugs. Politicians such as Mr Webb are very much the exception.
Elsewhere, signs of movement are minimal. Barack Obama has admitted that as a young man he used not only marijuana – and, unlike Bill Clinton, he inhaled; the whole point was to inhale, he joked – but also cocaine. This might suggest the president has an open mind on the subject. And in a departure from the previous administration, his attorney-general has said he will not bring federal prosecutions against the medical use of marijuana in states that allow it. But then at a recent event Mr Obama ran away from a question about the broader decriminalisation of marijuana under cover of a wisecrack.
For now, outright legalisation of marijuana, let alone harder drugs, is difficult to imagine. Even gradual decriminalisation – a policy that maintains prohibition but removes it from the scope of the criminal law – seems unlikely, though perhaps not unthinkable. A new study by Glenn Greenwald, a writer and civil rights lawyer, looks at Portugal’s policy of decriminalisation**. He judges it a success: “While drug addiction, usage, and associated pathologies continue to skyrocket in many European Union states, those problems – in virtually every relevant category – have been either contained or measurably improved within Portugal since 2001.”
Somebody in the White House should take a look. This national calamity is no laughing matter.
*Drug War Crimes, published by the Independent Institute. **Drug Decriminalization in Portugal, published by the Cato Institute
clive.crook@gmail.com

Dark side of Dubai

2009-04-21T03:24:00.000-07:00

Dubai was meant to be a Middle-Eastern Shangri-La, a glittering monument to Arab enterprise and western capitalism. But as hard times arrive in the city state that rose from the desert sands, an uglier story is emerging. Johann Hari reports
Tuesday, 7 April 2009
The wide, smiling face of Sheikh Mohammed – the absolute ruler of Dubai – beams down on his creation. His image is displayed on every other building, sandwiched between the more familiar corporate rictuses of Ronald McDonald and Colonel Sanders. This man has sold Dubai to the world as the city of One Thousand and One Arabian Lights, a Shangri-La in the Middle East insulated from the dust-storms blasting across the region. He dominates the Manhattan-manqué skyline, beaming out from row after row of glass pyramids and hotels smelted into the shape of piles of golden coins. And there he stands on the tallest building in the world – a skinny spike, jabbing farther into the sky than any other human construction in history.
But something has flickered in Sheikh Mohammed's smile. The ubiquitous cranes have paused on the skyline, as if stuck in time. There are countless buildings half-finished, seemingly abandoned. In the swankiest new constructions – like the vast Atlantis hotel, a giant pink castle built in 1,000 days for $1.5bn on its own artificial island – where rainwater is leaking from the ceilings and the tiles are falling off the roof. This Neverland was built on the Never-Never – and now the cracks are beginning to show. Suddenly it looks less like Manhattan in the sun than Iceland in the desert.
Once the manic burst of building has stopped and the whirlwind has slowed, the secrets of Dubai are slowly seeping out. This is a city built from nothing in just a few wild decades on credit and ecocide, suppression and slavery. Dubai is a living metal metaphor for the neo-liberal globalised world that may be crashing – at last – into history.
I. An Adult Disneyland
Karen Andrews can't speak. Every time she starts to tell her story, she puts her head down and crumples. She is slim and angular and has the faded radiance of the once-rich, even though her clothes are as creased as her forehead. I find her in the car park of one of Dubai's finest international hotels, where she is living, in her Range Rover. She has been sleeping here for months, thanks to the kindness of the Bangladeshi car park attendants who don't have the heart to move her on. This is not where she thought her Dubai dream would end.
Her story comes out in stutters, over four hours. At times, her old voice – witty and warm – breaks through. Karen came here from Canada when her husband was offered a job in the senior division of a famous multinational. "When he said Dubai, I said – if you want me to wear black and quit booze, baby, you've got the wrong girl. But he asked me to give it a chance. And I loved him."
All her worries melted when she touched down in Dubai in 2005. "It was an adult Disneyland, where Sheikh Mohammed is the mouse," she says. "Life was fantastic. You had these amazing big apartments, you had a whole army of your own staff, you pay no taxes at all. It seemed like everyone was a CEO. We were partying the whole time."
Her husband, Daniel, bought two properties. "We were drunk on Dubai," she says. But for the first time in his life, he was beginning to mismanage their finances. "We're not talking huge sums, but he was getting confused. It was so unlike Daniel, I was surprised. We got into a little bit of debt." After a year, she found out why: Daniel was diagnosed with a brain tumour.
One doctor told him he had a year to live; another said it was benign and he'd be okay. But the debts were growing. "Before I came here, I didn't know anything about Dubai law. I assumed if all these big companies come here, it must be pretty like Canada's or any other liberal democracy's," she says. Nobody told her there is no concept of bankruptcy. If you get into debt and you can't pay, you go to prison.
"When we realised that, I sat Daniel down and told him: listen, we need to get out of here. He knew he was guaranteed a pay-off when he resigned, so we said – right, let's take the pay-off, clear the debt, and go." So Daniel resigned – but he was given a lower pay-off than his contract suggested. The debt remained. As soon as you quit your job in Dubai, your employer has to inform your bank. If you have any outstanding debts that aren't covered by your savings, then all your accounts are frozen, and you are forbidden to leave the country.
"Suddenly our cards stopped working. We had nothing. We were thrown out of our apartment." Karen can't speak about what happened next for a long time; she is shaking.
Daniel was arrested and taken away on the day of their eviction. It was six days before she could talk to him. "He told me he was put in a cell with another debtor, a Sri Lankan guy who was only 27, who said he couldn't face the shame to his family. Daniel woke up and the boy had swallowed razor-blades. He banged for help, but nobody came, and the boy died in front of him."
Karen managed to beg from her friends for a few weeks, "but it was so humiliating. I've never lived like this. I worked in the fashion industry. I had my own shops. I've never..." She peters out.
Daniel was sentenced to six months' imprisonment at a trial he couldn't understand. It was in Arabic, and there was no translation. "Now I'm here illegally, too," Karen says I've got no money, nothing. I have to last nine months until he's out, somehow." Looking away, almost paralysed with embarrassment, she asks if I could buy her a meal.
She is not alone. All over the city, there are maxed-out expats sleeping secretly in the sand-dunes or the airport or in their cars.
"The thing you have to understand about Dubai is – nothing is what it seems," Karen says at last. "Nothing. This isn't a city, it's a con-job. They lure you in telling you it's one thing – a modern kind of place – but beneath the surface it's a medieval dictatorship."
II. Tumbleweed
Thirty years ago, almost all of contemporary Dubai was desert, inhabited only by cactuses and tumbleweed and scorpions. But downtown there are traces of the town that once was, buried amidst the metal and glass. In the dusty fort of the Dubai Museum, a sanitised version of this story is told.
In the mid-18th century, a small village was built here, in the lower Persian Gulf, where people would dive for pearls off the coast. It soon began to accumulate a cosmopolitan population washing up from Persia, the Indian subcontinent, and other Arab countries, all hoping to make their fortune. They named it after a local locust, the daba, who consumed everything before it. The town was soon seized by the gunships of the British Empire, who held it by the throat as late as 1971. As they scuttled away, Dubai decided to ally with the six surrounding states and make up the United Arab Emirates (UAE).
The British quit, exhausted, just as oil was being discovered, and the sheikhs who suddenly found themselves in charge faced a remarkable dilemma. They were largely illiterate nomads who spent their lives driving camels through the desert – yet now they had a vast pot of gold. What should they do with it?
Dubai only had a dribble of oil compared to neighbouring Abu Dhabi – so Sheikh Maktoum decided to use the revenues to build something that would last. Israel used to boast it made the desert bloom; Sheikh Maktoum resolved to make the desert boom. He would build a city to be a centre of tourism and financial services, sucking up cash and talent from across the globe. He invited the world to come tax-free – and they came in their millions, swamping the local population, who now make up just 5 per cent of Dubai. A city seemed to fall from the sky in just three decades, whole and complete and swelling. They fast-forwarded from the 18th century to the 21st in a single generation.
If you take the Big Bus Tour of Dubai – the passport to a pre-processed experience of every major city on earth – you are fed the propaganda-vision of how this happened. "Dubai's motto is 'Open doors, open minds'," the tour guide tells you in clipped tones, before depositing you at the souks to buy camel tea-cosies. "Here you are free. To purchase fabrics," he adds. As you pass each new monumental building, he tells you: "The World Trade Centre was built by His Highness..."
But this is a lie. The sheikh did not build this city. It was built by slaves. They are building it now.
III. Hidden in plain view
There are three different Dubais, all swirling around each other. There are the expats, like Karen; there are the Emiratis, headed by Sheikh Mohammed; and then there is the foreign underclass who built the city, and are trapped here. They are hidden in plain view. You see them everywhere, in dirt-caked blue uniforms, being shouted at by their superiors, like a chain gang – but you are trained not to look. It is like a mantra: the Sheikh built the city. The Sheikh built the city. Workers? What workers?
Every evening, the hundreds of thousands of young men who build Dubai are bussed from their sites to a vast concrete wasteland an hour out of town, where they are quarantined away. Until a few years ago they were shuttled back and forth on cattle trucks, but the expats complained this was unsightly, so now they are shunted on small metal buses that function like greenhouses in the desert heat. They sweat like sponges being slowly wrung out.
Sonapur is a rubble-strewn patchwork of miles and miles of identical concrete buildings. Some 300,000 men live piled up here, in a place whose name in Hindi means "City of Gold". In the first camp I stop at – riven with the smell of sewage and sweat – the men huddle around, eager to tell someone, anyone, what is happening to them.
Sahinal Monir, a slim 24-year-old from the deltas of Bangladesh. "To get you here, they tell you Dubai is heaven. Then you get here and realise it is hell," he says. Four years ago, an employment agent arrived in Sahinal's village in Southern Bangladesh. He told the men of the village that there was a place where they could earn 40,000 takka a month (£400) just for working nine-to-five on construction projects. It was a place where they would be given great accommodation, great food, and treated well. All they had to do was pay an up-front fee of 220,000 takka (£2,300) for the work visa – a fee they'd pay off in the first six months, easy. So Sahinal sold his family land, and took out a loan from the local lender, to head to this paradise.
As soon as he arrived at Dubai airport, his passport was taken from him by his construction company. He has not seen it since. He was told brusquely that from now on he would be working 14-hour days in the desert heat – where western tourists are advised not to stay outside for even five minutes in summer, when it hits 55 degrees – for 500 dirhams a month (£90), less than a quarter of the wage he was promised. If you don't like it, the company told him, go home. "But how can I go home? You have my passport, and I have no money for the ticket," he said. "Well, then you'd better get to work," they replied.
Sahinal was in a panic. His family back home – his son, daughter, wife and parents – were waiting for money, excited that their boy had finally made it. But he was going to have to work for more than two years just to pay for the cost of getting here – and all to earn less than he did in Bangladesh.
He shows me his room. It is a tiny, poky, concrete cell with triple-decker bunk-beds, where he lives with 11 other men. All his belongings are piled onto his bunk: three shirts, a spare pair of trousers, and a cellphone. The room stinks, because the lavatories in the corner of the camp – holes in the ground – are backed up with excrement and clouds of black flies. There is no air conditioning or fans, so the heat is "unbearable. You cannot sleep. All you do is sweat and scratch all night." At the height of summer, people sleep on the floor, on the roof, anywhere where they can pray for a moment of breeze.
The water delivered to the camp in huge white containers isn't properly desalinated: it tastes of salt. "It makes us sick, but we have nothing else to drink," he says.
The work is "the worst in the world," he says. "You have to carry 50kg bricks and blocks of cement in the worst heat imaginable ... This heat – it is like nothing else. You sweat so much you can't pee, not for days or weeks. It's like all the liquid comes out through your skin and you stink. You become dizzy and sick but you aren't allowed to stop, except for an hour in the afternoon. You know if you drop anything or slip, you could die. If you take time off sick, your wages are docked, and you are trapped here even longer."
He is currently working on the 67th floor of a shiny new tower, where he builds upwards, into the sky, into the heat. He doesn't know its name. In his four years here, he has never seen the Dubai of tourist-fame, except as he constructs it floor-by-floor.
Is he angry? He is quiet for a long time. "Here, nobody shows their anger. You can't. You get put in jail for a long time, then deported." Last year, some workers went on strike after they were not given their wages for four months. The Dubai police surrounded their camps with razor-wire and water-cannons and blasted them out and back to work.
The "ringleaders" were imprisoned. I try a different question: does Sohinal regret coming? All the men look down, awkwardly. "How can we think about that? We are trapped. If we start to think about regrets..." He lets the sentence trail off. Eventually, another worker breaks the silence by adding: "I miss my country, my family and my land. We can grow food in Bangladesh. Here, nothing grows. Just oil and buildings."
Since the recession hit, they say, the electricity has been cut off in dozens of the camps, and the men have not been paid for months. Their companies have disappeared with their passports and their pay. "We have been robbed of everything. Even if somehow we get back to Bangladesh, the loan sharks will demand we repay our loans immediately, and when we can't, we'll be sent to prison."
This is all supposed to be illegal. Employers are meant to pay on time, never take your passport, give you breaks in the heat – but I met nobody who said it happens. Not one. These men are conned into coming and trapped into staying, with the complicity of the Dubai authorities.
Sahinal could well die out here. A British man who used to work on construction projects told me: "There's a huge number of suicides in the camps and on the construction sites, but they're not reported. They're described as 'accidents'." Even then, their families aren't free: they simply inherit the debts. A Human Rights Watch study found there is a "cover-up of the true extent" of deaths from heat exhaustion, overwork and suicide, but the Indian consulate registered 971 deaths of their nationals in 2005 alone. After this figure was leaked, the consulates were told to stop counting.
At night, in the dusk, I sit in the camp with Sohinal and his friends as they scrape together what they have left to buy a cheap bottle of spirits. They down it in one ferocious gulp. "It helps you to feel numb", Sohinal says through a stinging throat. In the distance, the glistening Dubai skyline he built stands, oblivious.
IV. Mauled by the mall
I find myself stumbling in a daze from the camps into the sprawling marble malls that seem to stand on every street in Dubai. It is so hot there is no point building pavements; people gather in these cathedrals of consumerism to bask in the air conditioning. So within a ten minute taxi-ride, I have left Sohinal and I am standing in the middle of Harvey Nichols, being shown a £20,000 taffeta dress by a bored salesgirl. "As you can see, it is cut on the bias..." she says, and I stop writing.
Time doesn't seem to pass in the malls. Days blur with the same electric light, the same shined floors, the same brands I know from home. Here, Dubai is reduced to its component sounds: do-buy. In the most expensive malls I am almost alone, the shops empty and echoing. On the record, everybody tells me business is going fine. Off the record, they look panicky. There is a hat exhibition ahead of the Dubai races, selling elaborate headgear for £1,000 a pop. "Last year, we were packed. Now look," a hat designer tells me. She swoops her arm over a vacant space.
I approach a blonde 17-year-old Dutch girl wandering around in hotpants, oblivious to the swarms of men gaping at her. "I love it here!" she says. "The heat, the malls, the beach!" Does it ever bother you that it's a slave society? She puts her head down, just as Sohinal did. "I try not to see," she says. Even at 17, she has learned not to look, and not to ask; that, she senses, is a transgression too far.
Between the malls, there is nothing but the connecting tissue of asphalt. Every road has at least four lanes; Dubai feels like a motorway punctuated by shopping centres. You only walk anywhere if you are suicidal. The residents of Dubai flit from mall to mall by car or taxis.
How does it feel if this is your country, filled with foreigners? Unlike the expats and the slave class, I can't just approach the native Emiratis to ask questions when I see them wandering around – the men in cool white robes, the women in sweltering black. If you try, the women blank you, and the men look affronted, and tell you brusquely that Dubai is "fine". So I browse through the Emirati blog-scene and found some typical-sounding young Emiratis. We meet – where else? – in the mall.
Ahmed al-Atar is a handsome 23-year-old with a neat, trimmed beard, tailored white robes, and rectangular wire-glasses. He speaks perfect American-English, and quickly shows that he knows London, Los Angeles and Paris better than most westerners. Sitting back in his chair in an identikit Starbucks, he announces: "This is the best place in the world to be young! The government pays for your education up to PhD level. You get given a free house when you get married. You get free healthcare, and if it's not good enough here, they pay for you to go abroad. You don't even have to pay for your phone calls. Almost everyone has a maid, a nanny, and a driver. And we never pay any taxes. Don't you wish you were Emirati?"
I try to raise potential objections to this Panglossian summary, but he leans forward and says: "Look – my grandfather woke up every day and he would have to fight to get to the well first to get water. When the wells ran dry, they had to have water delivered by camel. They were always hungry and thirsty and desperate for jobs. He limped all his life, because he there was no medical treatment available when he broke his leg. Now look at us!"
For Emiratis, this is a Santa Claus state, handing out goodies while it makes its money elsewhere: through renting out land to foreigners, soft taxes on them like business and airport charges, and the remaining dribble of oil. Most Emiratis, like Ahmed, work for the government, so they're cushioned from the credit crunch. "I haven't felt any effect at all, and nor have my friends," he says. "Your employment is secure. You will only be fired if you do something incredibly bad." The laws are currently being tightened, to make it even more impossible to sack an Emirati.
Sure, the flooding-in of expats can sometimes be "an eyesore", Ahmed says. "But we see the expats as the price we had to pay for this development. How else could we do it? Nobody wants to go back to the days of the desert, the days before everyone came. We went from being like an African country to having an average income per head of $120,000 a year. And we're supposed to complain?"
He says the lack of political freedom is fine by him. "You'll find it very hard to find an Emirati who doesn't support Sheikh Mohammed." Because they're scared? "No, because we really all support him. He's a great leader. Just look!" He smiles and says: "I'm sure my life is very much like yours. We hang out, have a coffee, go to the movies. You'll be in a Pizza Hut or Nando's in London, and at the same time I'll be in one in Dubai," he says, ordering another latte.
But do all young Emiratis see it this way? Can it really be so sunny in the political sands? In the sleek Emirates Tower Hotel, I meet Sultan al-Qassemi. He's a 31-year-old Emirati columnist for the Dubai press and private art collector, with a reputation for being a contrarian liberal, advocating gradual reform. He is wearing Western clothes – blue jeans and a Ralph Lauren shirt – and speaks incredibly fast, turning himself into a manic whirr of arguments.
"People here are turning into lazy, overweight babies!" he exclaims. "The nanny state has gone too far. We don't do anything for ourselves! Why don't any of us work for the private sector? Why can't a mother and father look after their own child?" And yet, when I try to bring up the system of slavery that built Dubai, he looks angry. "People should give us credit," he insists. "We are the most tolerant people in the world. Dubai is the only truly international city in the world. Everyone who comes here is treated with respect."
I pause, and think of the vast camps in Sonapur, just a few miles away. Does he even know they exist? He looks irritated. "You know, if there are 30 or 40 cases [of worker abuse] a year, that sounds like a lot but when you think about how many people are here..." Thirty or 40? This abuse is endemic to the system, I say. We're talking about hundreds of thousands.
Sultan is furious. He splutters: "You don't think Mexicans are treated badly in New York City? And how long did it take Britain to treat people well? I could come to London and write about the homeless people on Oxford Street and make your city sound like a terrible place, too! The workers here can leave any time they want! Any Indian can leave, any Asian can leave!"
But they can't, I point out. Their passports are taken away, and their wages are withheld. "Well, I feel bad if that happens, and anybody who does that should be punished. But their embassies should help them." They try. But why do you forbid the workers – with force – from going on strike against lousy employers? "Thank God we don't allow that!" he exclaims. "Strikes are in-convenient! They go on the street – we're not having that. We won't be like France. Imagine a country where they the workers can just stop whenever they want!" So what should the workers do when they are cheated and lied to? "Quit. Leave the country."
I sigh. Sultan is seething now. "People in the West are always complaining about us," he says. Suddenly, he adopts a mock-whiny voice and says, in imitation of these disgusting critics: "Why don't you treat animals better? Why don't you have better shampoo advertising? Why don't you treat labourers better?" It's a revealing order: animals, shampoo, then workers. He becomes more heated, shifting in his seat, jabbing his finger at me. "I gave workers who worked for me safety goggles and special boots, and they didn't want to wear them! It slows them down!"
And then he smiles, coming up with what he sees as his killer argument. "When I see Western journalists criticise us – don't you realise you're shooting yourself in the foot? The Middle East will be far more dangerous if Dubai fails. Our export isn't oil, it's hope. Poor Egyptians or Libyans or Iranians grow up saying – I want to go to Dubai. We're very important to the region. We are showing how to be a modern Muslim country. We don't have any fundamentalists here. Europeans shouldn't gloat at our demise. You should be very worried.... Do you know what will happen if this model fails? Dubai will go down the Iranian path, the Islamist path."
Sultan sits back. My arguments have clearly disturbed him; he says in a softer, conciliatory tone, almost pleading: "Listen. My mother used to go to the well and get a bucket of water every morning. On her wedding day, she was given an orange as a gift because she had never eaten one. Two of my brothers died when they were babies because the healthcare system hadn't developed yet. Don't judge us." He says it again, his eyes filled with intensity: "Don't judge us."
V. The Dunkin' Donuts Dissidents
But there is another face to the Emirati minority – a small huddle of dissidents, trying to shake the Sheikhs out of abusive laws. Next to a Virgin Megastore and a Dunkin' Donuts, with James Blunt's "You're Beautiful" blaring behind me, I meet the Dubai dictatorship's Public Enemy Number One. By way of introduction, Mohammed al-Mansoori says from within his white robes and sinewy face: "Westerners come her and see the malls and the tall buildings and they think that means we are free. But these businesses, these buildings – who are they for? This is a dictatorship. The royal family think they own the country, and the people are their servants. There is no freedom here."
We snuffle out the only Arabic restaurant in this mall, and he says everything you are banned – under threat of prison – from saying in Dubai. Mohammed tells me he was born in Dubai to a fisherman father who taught him one enduring lesson: Never follow the herd. Think for yourself. In the sudden surge of development, Mohammed trained as a lawyer. By the Noughties, he had climbed to the head of the Jurists' Association, an organisation set up to press for Dubai's laws to be consistent with international human rights legislation.
And then – suddenly – Mohammed thwacked into the limits of Sheikh Mohammed's tolerance. Horrified by the "system of slavery" his country was being built on, he spoke out to Human Rights Watch and the BBC. "So I was hauled in by the secret police and told: shut up, or you will lose you job, and your children will be unemployable," he says. "But how could I be silent?"
He was stripped of his lawyer's licence and his passport – becoming yet another person imprisoned in this country. "I have been blacklisted and so have my children. The newspapers are not allowed to write about me."
Why is the state so keen to defend this system of slavery? He offers a prosaic explanation. "Most companies are owned by the government, so they oppose human rights laws because it will reduce their profit margins. It's in their interests that the workers are slaves."
Last time there was a depression, there was a starbust of democracy in Dubai, seized by force from the sheikhs. In the 1930s, the city's merchants banded together against Sheikh Said bin Maktum al-Maktum – the absolute ruler of his day – and insisted they be given control over the state finances. It lasted only a few years, before the Sheikh – with the enthusiastic support of the British – snuffed them out.
And today? Sheikh Mohammed turned Dubai into Creditopolis, a city built entirely on debt. Dubai owes 107 percent of its entire GDP. It would be bust already, if the neighbouring oil-soaked state of Abu Dhabi hadn't pulled out its chequebook. Mohammed says this will constrict freedom even further. "Now Abu Dhabi calls the tunes – and they are much more conservative and restrictive than even Dubai. Freedom here will diminish every day." Already, new media laws have been drafted forbidding the press to report on anything that could "damage" Dubai or "its economy". Is this why the newspapers are giving away glossy supplements talking about "encouraging economic indicators"?
Everybody here waves Islamism as the threat somewhere over the horizon, sure to swell if their advice is not followed. Today, every imam is appointed by the government, and every sermon is tightly controlled to keep it moderate. But Mohammed says anxiously: "We don't have Islamism here now, but I think that if you control people and give them no way to express anger, it could rise. People who are told to shut up all the time can just explode."
Later that day, against another identikit-corporate backdrop, I meet another dissident – Abdulkhaleq Abdullah, Professor of Political Science at Emirates University. His anger focuses not on political reform, but the erosion of Emirati identity. He is famous among the locals, a rare outspoken conductor for their anger. He says somberly: "There has been a rupture here. This is a totally different city to the one I was born in 50 years ago."
He looks around at the shiny floors and Western tourists and says: "What we see now didn't occur in our wildest dreams. We never thought we could be such a success, a trendsetter, a model for other Arab countries. The people of Dubai are mighty proud of their city, and rightly so. And yet..." He shakes his head. "In our hearts, we fear we have built a modern city but we are losing it to all these expats."
Adbulkhaleq says every Emirati of his generation lives with a "psychological trauma." Their hearts are divided – "between pride on one side, and fear on the other." Just after he says this, a smiling waitress approaches, and asks us what we would like to drink. He orders a Coke.
VI. Dubai Pride
There is one group in Dubai for whom the rhetoric of sudden freedom and liberation rings true – but it is the very group the government wanted to liberate least: gays.
Beneath a famous international hotel, I clamber down into possibly the only gay club on the Saudi Arabian peninsula. I find a United Nations of tank-tops and bulging biceps, dancing to Kylie, dropping ecstasy, and partying like it's Soho. "Dubai is the best place in the Muslim world for gays!" a 25-year old Emirati with spiked hair says, his arms wrapped around his 31-year old "husband". "We are alive. We can meet. That is more than most Arab gays."
It is illegal to be gay in Dubai, and punishable by 10 years in prison. But the locations of the latest unofficial gay clubs circulate online, and men flock there, seemingly unafraid of the police. "They might bust the club, but they will just disperse us," one of them says. "The police have other things to do."
In every large city, gay people find a way to find each other – but Dubai has become the clearing-house for the region's homosexuals, a place where they can live in relative safety. Saleh, a lean private in the Saudi Arabian army, has come here for the Coldplay concert, and tells me Dubai is "great" for gays: "In Saudi, it's hard to be straight when you're young. The women are shut away so everyone has gay sex. But they only want to have sex with boys – 15- to 21-year-olds. I'm 27, so I'm too old now. I need to find real gays, so this is the best place. All Arab gays want to live in Dubai."
With that, Saleh dances off across the dancefloor, towards a Dutch guy with big biceps and a big smile.
VII. The Lifestyle
All the guidebooks call Dubai a "melting pot", but as I trawl across the city, I find that every group here huddles together in its own little ethnic enclave – and becomes a caricature of itself. One night – in the heart of this homesick city, tired of the malls and the camps – I go to Double Decker, a hang-out for British expats. At the entrance there is a red telephone box, and London bus-stop signs. Its wooden interior looks like a cross between a colonial clubhouse in the Raj and an Eighties school disco, with blinking coloured lights and cheese blaring out. As I enter, a girl in a short skirt collapses out of the door onto her back. A guy wearing a pirate hat helps her to her feet, dropping his beer bottle with a paralytic laugh.
I start to talk to two sun-dried women in their sixties who have been getting gently sozzled since midday. "You stay here for The Lifestyle," they say, telling me to take a seat and order some more drinks. All the expats talk about The Lifestyle, but when you ask what it is, they become vague. Ann Wark tries to summarise it: "Here, you go out every night. You'd never do that back home. You see people all the time. It's great. You have lots of free time. You have maids and staff so you don't have to do all that stuff. You party!"
They have been in Dubai for 20 years, and they are happy to explain how the city works. "You've got a hierarchy, haven't you?" Ann says. "It's the Emiratis at the top, then I'd say the British and other Westerners. Then I suppose it's the Filipinos, because they've got a bit more brains than the Indians. Then at the bottom you've got the Indians and all them lot."
They admit, however, they have "never" spoken to an Emirati. Never? "No. They keep themselves to themselves." Yet Dubai has disappointed them. Jules Taylor tells me: "If you have an accident here it's a nightmare. There was a British woman we knew who ran over an Indian guy, and she was locked up for four days! If you have a tiny bit of alcohol on your breath they're all over you. These Indians throw themselves in front of cars, because then their family has to be given blood money – you know, compensation. But the police just blame us. That poor woman."
A 24-year-old British woman called Hannah Gamble takes a break from the dancefloor to talk to me. "I love the sun and the beach! It's great out here!" she says. Is there anything bad? "Oh yes!" she says. Ah: one of them has noticed, I think with relief. "The banks! When you want to make a transfer you have to fax them. You can't do it online." Anything else? She thinks hard. "The traffic's not very good."
When I ask the British expats how they feel to not be in a democracy, their reaction is always the same. First, they look bemused. Then they look affronted. "It's the Arab way!" an Essex boy shouts at me in response, as he tries to put a pair of comedy antlers on his head while pouring some beer into the mouth of his friend, who is lying on his back on the floor, gurning.
Later, in a hotel bar, I start chatting to a dyspeptic expat American who works in the cosmetics industry and is desperate to get away from these people. She says: "All the people who couldn't succeed in their own countries end up here, and suddenly they're rich and promoted way above their abilities and bragging about how great they are. I've never met so many incompetent people in such senior positions anywhere in the world." She adds: "It's absolutely racist. I had Filipino girls working for me doing the same job as a European girl, and she's paid a quarter of the wages. The people who do the real work are paid next to nothing, while these incompetent managers pay themselves £40,000 a month."
With the exception of her, one theme unites every expat I speak to: their joy at having staff to do the work that would clog their lives up Back Home. Everyone, it seems, has a maid. The maids used to be predominantly Filipino, but with the recession, Filipinos have been judged to be too expensive, so a nice Ethiopian servant girl is the latest fashionable accessory.
It is an open secret that once you hire a maid, you have absolute power over her. You take her passport – everyone does; you decide when to pay her, and when – if ever – she can take a break; and you decide who she talks to. She speaks no Arabic. She cannot escape.
In a Burger King, a Filipino girl tells me it is "terrifying" for her to wander the malls in Dubai because Filipino maids or nannies always sneak away from the family they are with and beg her for help. "They say – 'Please, I am being held prisoner, they don't let me call home, they make me work every waking hour seven days a week.' At first I would say – my God, I will tell the consulate, where are you staying? But they never know their address, and the consulate isn't interested. I avoid them now. I keep thinking about a woman who told me she hadn't eaten any fruit in four years. They think I have power because I can walk around on my own, but I'm powerless."
The only hostel for women in Dubai – a filthy private villa on the brink of being repossessed – is filled with escaped maids. Mela Matari, a 25-year-old Ethiopian woman with a drooping smile, tells me what happened to her – and thousands like her. She was promised a paradise in the sands by an agency, so she left her four year-old daughter at home and headed here to earn money for a better future. "But they paid me half what they promised. I was put with an Australian family – four children – and Madam made me work from 6am to 1am every day, with no day off. I was exhausted and pleaded for a break, but they just shouted: 'You came here to work, not sleep!' Then one day I just couldn't go on, and Madam beat me. She beat me with her fists and kicked me. My ear still hurts. They wouldn't give me my wages: they said they'd pay me at the end of the two years. What could I do? I didn't know anybody here. I was terrified."
One day, after yet another beating, Mela ran out onto the streets, and asked – in broken English – how to find the Ethiopian consulate. After walking for two days, she found it, but they told her she had to get her passport back from Madam. "Well, how could I?" she asks. She has been in this hostel for six months. She has spoken to her daughter twice. "I lost my country, I lost my daughter, I lost everything," she says.
As she says this, I remember a stray sentence I heard back at Double Decker. I asked a British woman called Hermione Frayling what the best thing about Dubai was. "Oh, the servant class!" she trilled. "You do nothing. They'll do anything!"
VIII. The End of The World
The World is empty. It has been abandoned, its continents unfinished. Through binoculars, I think I can glimpse Britain; this sceptred isle barren in the salt-breeze.
Here, off the coast of Dubai, developers have been rebuilding the world. They have constructed artificial islands in the shape of all planet Earth's land masses, and they plan to sell each continent off to be built on. There were rumours that the Beckhams would bid for Britain. But the people who work at the nearby coast say they haven't seen anybody there for months now. "The World is over," a South African suggests.
All over Dubai, crazy projects that were Under Construction are now Under Collapse. They were building an air-conditioned beach here, with cooling pipes running below the sand, so the super-rich didn't singe their toes on their way from towel to sea.
The projects completed just before the global economy crashed look empty and tattered. The Atlantis Hotel was launched last winter in a $20m fin-de-siecle party attended by Robert De Niro, Lindsay Lohan and Lily Allen. Sitting on its own fake island – shaped, of course, like a palm tree – it looks like an immense upturned tooth in a faintly decaying mouth. It is pink and turreted – the architecture of the pharaohs, as reimagined by Zsa-Zsa Gabor. Its Grand Lobby is a monumental dome covered in glitterballs, held up by eight monumental concrete palm trees. Standing in the middle, there is a giant shining glass structure that looks like the intestines of every guest who has ever stayed at the Atlantis. It is unexpectedly raining; water is leaking from the roof, and tiles are falling off.
A South African PR girl shows me around its most coveted rooms, explaining that this is "the greatest luxury offered in the world". We stroll past shops selling £24m diamond rings around a hotel themed on the lost and sunken continent of, yes, Atlantis. There are huge water tanks filled with sharks, which poke around mock-abandoned castles and dumped submarines. There are more than 1,500 rooms here, each with a sea view. The Neptune suite has three floors, and – I gasp as I see it – it looks out directly on to the vast shark tank. You lie on the bed, and the sharks stare in at you. In Dubai, you can sleep with the fishes, and survive.
But even the luxury – reminiscent of a Bond villain's lair – is also being abandoned. I check myself in for a few nights to the classiest hotel in town, the Park Hyatt. It is the fashionistas' favourite hotel, where Elle Macpherson and Tommy Hilfiger stay, a gorgeous, understated palace. It feels empty. Whenever I eat, I am one of the only people in the restaurant. A staff member tells me in a whisper: "It used to be full here. Now there's hardly anyone." Rattling around, I feel like Jack Nicholson in The Shining, the last man in an abandoned, haunted home.
The most famous hotel in Dubai – the proud icon of the city – is the Burj al Arab hotel, sitting on the shore, shaped like a giant glass sailing boat. In the lobby, I start chatting to a couple from London who work in the City. They have been coming to Dubai for 10 years now, and they say they love it. "You never know what you'll find here," he says. "On our last trip, at the beginning of the holiday, our window looked out on the sea. By the end, they'd built an entire island there."
My patience frayed by all this excess, I find myself snapping: doesn't the omnipresent slave class bother you? I hope they misunderstood me, because the woman replied: "That's what we come for! It's great, you can't do anything for yourself!" Her husband chimes in: "When you go to the toilet, they open the door, they turn on the tap – the only thing they don't do is take it out for you when you have a piss!" And they both fall about laughing.
IX. Taking on the Desert
Dubai is not just a city living beyond its financial means; it is living beyond its ecological means. You stand on a manicured Dubai lawn and watch the sprinklers spray water all around you. You see tourists flocking to swim with dolphins. You wander into a mountain-sized freezer where they have built a ski slope with real snow. And a voice at the back of your head squeaks: this is the desert. This is the most water-stressed place on the planet. How can this be happening? How is it possible?
The very earth is trying to repel Dubai, to dry it up and blow it away. The new Tiger Woods Gold Course needs four million gallons of water to be pumped on to its grounds every day, or it would simply shrivel and disappear on the winds. The city is regularly washed over with dust-storms that fog up the skies and turn the skyline into a blur. When the dust parts, heat burns through. It cooks anything that is not kept constantly, artificially wet.
Dr Mohammed Raouf, the environmental director of the Gulf Research Centre, sounds sombre as he sits in his Dubai office and warns: "This is a desert area, and we are trying to defy its environment. It is very unwise. If you take on the desert, you will lose."
Sheikh Maktoum built his showcase city in a place with no useable water. None. There is no surface water, very little acquifer, and among the lowest rainfall in the world. So Dubai drinks the sea. The Emirates' water is stripped of salt in vast desalination plants around the Gulf – making it the most expensive water on earth. It costs more than petrol to produce, and belches vast amounts of carbon dioxide into the atmosphere as it goes. It's the main reason why a resident of Dubai has the biggest average carbon footprint of any human being – more than double that of an American.
If a recession turns into depression, Dr Raouf believes Dubai could run out of water. "At the moment, we have financial reserves that cover bringing so much water to the middle of the desert. But if we had lower revenues – if, say, the world shifts to a source of energy other than oil..." he shakes his head. "We will have a very big problem. Water is the main source of life. It would be a catastrophe. Dubai only has enough water to last us a week. There's almost no storage. We don't know what will happen if our supplies falter. It would be hard to survive."
Global warming, he adds, makes the problem even worse. "We are building all these artificial islands, but if the sea level rises, they will be gone, and we will lose a lot. Developers keep saying it's all fine, they've taken it into consideration, but I'm not so sure."
Is the Dubai government concerned about any of this? "There isn't much interest in these problems," he says sadly. But just to stand still, the average resident of Dubai needs three times more water than the average human. In the looming century of water stresses and a transition away from fossil fuels, Dubai is uniquely vulnerable.
I wanted to understand how the government of Dubai will react, so I decided to look at how it has dealt with an environmental problem that already exists – the pollution of its beaches. One woman – an American, working at one of the big hotels – had written in a lot of online forums arguing that it was bad and getting worse, so I called her to arrange a meeting. "I can't talk to you," she said sternly. Not even if it's off the record? "I can't talk to you." But I don't have to disclose your name... "You're not listening. This phone is bugged. I can't talk to you," she snapped, and hung up.
The next day I turned up at her office. "If you reveal my identity, I'll be sent on the first plane out of this city," she said, before beginning to nervously pace the shore with me. "It started like this. We began to get complaints from people using the beach. The water looked and smelled odd, and they were starting to get sick after going into it. So I wrote to the ministers of health and tourism and expected to hear back immediately – but there was nothing. Silence. I hand-delivered the letters. Still nothing."
The water quality got worse and worse. The guests started to spot raw sewage, condoms, and used sanitary towels floating in the sea. So the hotel ordered its own water analyses from a professional company. "They told us it was full of fecal matter and bacteria 'too numerous to count'. I had to start telling guests not to go in the water, and since they'd come on a beach holiday, as you can imagine, they were pretty pissed off." She began to make angry posts on the expat discussion forums – and people began to figure out what was happening. Dubai had expanded so fast its sewage treatment facilities couldn't keep up. The sewage disposal trucks had to queue for three or four days at the treatment plants – so instead, they were simply drilling open the manholes and dumping the untreated sewage down them, so it flowed straight to the sea.
Suddenly, it was an open secret – and the municipal authorities finally acknowledged the problem. They said they would fine the truckers. But the water quality didn't improve: it became black and stank. "It's got chemicals in it. I don't know what they are. But this stuff is toxic."
She continued to complain – and started to receive anonymous phone calls. "Stop embarassing Dubai, or your visa will be cancelled and you're out," they said. She says: "The expats are terrified to talk about anything. One critical comment in the newspapers and they deport you. So what am I supposed to do? Now the water is worse than ever. People are getting really sick. Eye infections, ear infections, stomach infections, rashes. Look at it!" There is faeces floating on the beach, in the shadow of one of Dubai's most famous hotels.
"What I learnt about Dubai is that the authorities don't give a toss about the environment," she says, standing in the stench. "They're pumping toxins into the sea, their main tourist attraction, for God's sake. If there are environmental problems in the future, I can tell you now how they will deal with them – deny it's happening, cover it up, and carry on until it's a total disaster." As she speaks, a dust-storm blows around us, as the desert tries, slowly, insistently, to take back its land.
X. Fake Plastic Trees
On my final night in the Dubai Disneyland, I stop off on my way to the airport, at a Pizza Hut that sits at the side of one of the city's endless, wide, gaping roads. It is identical to the one near my apartment in London in every respect, even the vomit-coloured decor. My mind is whirring and distracted. Perhaps Dubai disturbed me so much, I am thinking, because here, the entire global supply chain is condensed. Many of my goods are made by semi-enslaved populations desperate for a chance 2,000 miles away; is the only difference that here, they are merely two miles away, and you sometimes get to glimpse their faces? Dubai is Market Fundamentalist Globalisation in One City.
I ask the Filipino girl behind the counter if she likes it here. "It's OK," she says cautiously. Really? I say. I can't stand it. She sighs with relief and says: "This is the most terrible place! I hate it! I was here for months before I realised – everything in Dubai is fake. Everything you see. The trees are fake, the workers' contracts are fake, the islands are fake, the smiles are fake – even the water is fake!" But she is trapped, she says. She got into debt to come here, and she is stuck for three years: an old story now. "I think Dubai is like an oasis. It is an illusion, not real. You think you have seen water in the distance, but you get close and you only get a mouthful of sand."
As she says this, another customer enters. She forces her face into the broad, empty Dubai smile and says: "And how may I help you tonight, sir?"
Some names in this article have been changed

Police raid is real conspiracy

2009-04-21T03:23:00.000-07:00

The arrest of 114 environmental activists in Nottingham in the early hours of yesterday morning in a massive police raid on a school in the city, represents a sinister state crack-down on the right to protest and should be condemned outright by everyone who wants to defend human rights and civil liberties.
How else can you explain the deployment of over 100 police from four counties, many in riot gear, to seal off a residential area of the city before launching what was essentially a political raid on a group of young people preparing for a protest action at the nearby Ratcliffe-on-Soar coal-fired power station?
The employment of catch-all conspiracy laws to justify the mass arrests is also a serious turn of events. These laws, under which people can be sentenced to extremely lengthy jail terms, are normally used in the case of extremely serious offences carried out or planned by two or more persons.
In this case, the use of conspiracy laws is aimed at sending a simple, clear message from the authorities: you are allowed to march from A to B and then go home; but if you want to take direct, more militant action to reinforce your message, then the state can and will take pre-emptive action to stop you on the grounds that you are allegedly “conspiring” against private property such as a power station. The fact that the 114 have since been released on bail only reinforces this point.
The police action in Nottingham also indicates that state agents had infiltrated the eco-campaigners group and supplied information to the police. Perhaps these agents even encouraged certain kinds of action in order to try and justify the police raid. Naturally, the power company E.On, which owns Ratcliffe, was extremely happy with the police action, claiming without any evidence that what had been prevented was a “a very dangerous and irresponsible attempt to disrupt an operational power plant".
A pattern is rapidly emerging in Britain whereby the state is using its mailed fist to hit out at activists. Last summer, the Climate Camp in Kent was subjected to systematic intimidation and harassment in a multi-million pound police operation involving helicopters and countless police photographers.
During the G20 economic summit in London, protesters in the City of London were corralled inside a small area and prevented from leaving the cordon by thousands of police. A passer-by, newspaper vendor Ian Tomlinson, was shoved to the ground by police and eyewitnesses also say he was hit with a baton before he collapsed and died.
In these circumstances, it is simply not good enough for Shami Chakrabarti, the director of Liberty, to circumscribe her remarks over the Nottingham raid by reportedly saying: "In the light of the policing of the G20 protests, people up and down the country will want to be confident that there was evidence of a real conspiracy to commit criminal damage by those arrested and that this was not just an attempt by the police to disrupt perfectly legitimate protest per se."
No, Shami, we are not confident in the police “case”. And why should we be? If the police knew so much, why didn’t they stop people at the power station perimeter fence? Instead, the police preferred to devote huge resources in a co-ordinated police raid that is normally used on anti-terror operations. No wonder really serious crimes go unsolved.
The real conspiracy is that the state is protecting a government that is doing nothing effective about climate change despite scientists stepping up their warnings about the dire consequences of inaction. Little wonder that young people in particular feel that something more dramatic than signing petitions is required, even if direct actions in themselves can’t really alter the situation where New Labour insists that the same economic forces that produced global warming will somehow solve the crisis.
We must halt the march to full-scale authoritarian rule that the Nottingham arrests signifies and redouble efforts to campaign for a new, democratic state that actually guarantees and enforces human rights in place of a capitalist state that is obliterating them one by one.
Paul FeldmanAWTW communications editor14 April 2009
http://www.aworldtowin.net/blog/police-raid-is-real-conspiracy.html

Police probe 29 UK torture cases

2009-04-09T02:10:00.000-07:00

Lawyers' dossier passed to the Met details claims of wider involvement of MI5 and MI6 in abuse
Mark Townsend
The Observer, Sunday 5 April 2009
Article history
Scotland Yard is examining allegations that terrorism suspects, including British citizens, were tortured with the complicity of MI5 and MI6 officers. The Metropolitan Police has received detailed evidence relating to the abuse of detainees involving UK intelligence agents, raising the possibility that its criminal inquiry into the alleged mistreatment of Guantánamo detainee Binyam Mohamed could be widened to include more than two dozen torture cases.
A 55-page dossier submitted by lawyers to the Met last week includes claims of UK involvement in 29 cases, including Mohamed's, of mistreatment or torture against British citizens or residents. Each is supported by testimony from victims, dates, locations, and in some cases details of the UK intelligence officers who questioned them.
Last week Vera Baird, the solicitor general, told parliament: "If there are more [cases] they will be looked at with the utmost care, with a view to ensuring that, if there is possible criminality, the police will investigate."
Former shadow home secretary David Davis said: "The police will have no choice but to investigate all these cases."
Compiled over four years by lawyers acting for British monitoring group Cageprisoner, the dossier corroborates claims that Britain was involved in a systematic international torture policy, with one case predating the 11 September attacks, going back as far as 1999. Six countries are named as being complicit with Britain, including Jordan, Egypt and Syria. Four cases relate to Kenya and the most - seven - involve Pakistan.
The claims come days after the Met was summoned by the attorney-general, Lady Scotland, to examine allegations that MI5 colluded in the torture of Mohamed by feeding the CIA questions while he was held in a secret prison. Details of another 28 cases, which Cageprisoner claims are equally compelling, will heighten calls for a judicial inquiry.
A Met source confirmed they were "considering the contents" of the report while they waited for Scotland to forward documentary evidence into Mohamed's case. He said the investigation into Mohamed had yet to start, and it was theoretically possible detectives could examine torture complicity allegations as part of a broader inquiry.
Human rights lawyer Gareth Peirce said the true nature of British involvement was becoming a "burning issue" and it was vital the "state is held properly and publicly to account". She added: "It was they [the British] who provided information that could be and was used in conditions of torture, and it was and is they who have received the product".
A spokesman for Cageprisoner said Scotland would also be asked to investigate alleged MI5 complicity in the questioning of men who claim to have been tortured, the majority while in US custody abroad. It comes as MPs prepare the most comprehensive examination of Britain's role in human rights abuses, focusing on claims of complicity in torture and concern that officials have contravened international law.
Cases in the report include details of UK intelligence officers involved in their questioning, such as their physical description and names. Examples of maltreatment include death threats, ferocious beatings and established torture techniques such as strappado, in which the victims' hands are tied behind their back and they are then suspended in the air by a rope attached to wrists, which typically dislocates both arms.
The earliest case involves Farid Hilali, who claims he was tortured on the "direct orders" of UK intelligence. Wanted in Spain over alleged links to the 9/11 attackers, Hilali said the alleged torture took place while he was held by the intelligence services of the United Arab Emirates and Morocco. His testimony describes a "white British male".
Another involves Tariq Mahmood who was tracked through Saudi Arabia to Pakistan where MI6 allegedly had him picked up by Pakistan's ISI secret service. During his interrogations with MI6, Mahmood claims British agents issued death threats if he did not co-operate.
Martin Mubanga was another allegedly questioned by British agents, including one called Martin, before being rendered for 33 months to Guantánamo, where he was tortured as a result of evidence obtained by UK officials supplying questions. Another named in the report, Shaker Aamer, remains in Guantánamo and is on an eight-week hunger strike.
Peirce described his deterioration as "frightening in the extreme" and believes he could die if he is not released soon. Aamer, 42, alleges that at least one British intelligence officer was present while his head was repeatedly hit against a cell wall during interrogation in 2002 at Bagram air base in Afghanistan.
The UK government strenuously denies using torture or facilitating its use.

A law unto themselves

2009-04-09T02:07:00.000-07:00

Once again the police have blood on their hands and a cover-up is already well under way. That’s the only conclusion you can draw from the video of the gratuitous police attack on bystander Ian Tomlinson during last week’s G20 protests in the City of London, soon after which he collapsed and died. The police had the area covered from every angle by CCTV and by their own photographers and must have known what happened. Yet the first official statement said that Tomlinson just happened to be found in a side street and that the Met’s brave police were attacked when they went to his assistance!
Sounds familiar? Jean Charles de Menezes, you will recall, was alleged to have leapt over a Tube ticket barrier and was wearing a bulky jacket, clearly trying to evade the police. None of this, naturally enough, turned out to be true. Yet no one was prosecuted for the execution of the Brazilian electrician while he sat reading his newspaper. And you can bet that the same will apply in the case of Tomlinson.
Why? Because the police are always only “doing their duty” in “difficult circumstances”. And what is this higher “duty” that allows them to behave with impunity and do things that ordinary citizens would end up in jail for? The duty in question conferred on the police by the state is to protect the status quo of capitalist society by whatever means are necessary, lawful and otherwise.
The first professional police force in the world was set up first in London in the 1830s and then throughout the rest of the country at a time of major social and political unrest. Workers had demanded and been refused the vote, trade unionists were deported from Dorset for illegally combining and riots were breaking out against the introduction of the workhouse for the unemployed.
The Royal Commission on the Police 1839 reported that the creation of a force throughout the country was a way in which “the constitutional authority of the supreme executive is thus emphatically asserted”. What the commission was talking about was the authority of the state as a whole in relation to maintaining and developing capitalism in terms of private property, as our book Unmasking the State – a rough guide to real democracy elaborates in more detail.
And that’s how the boys in blue have behaved ever since, with the notable exception of the London police strike after World War One when demands for an independent union were ruthlessly crushed. The high command of the state in the shape of senior officers sets the tone with wild statements about a “summer of rage” on the streets and then the unthinking plods are sent into action to do their worst, which they gleefully do. That’s what happened at the Climate Camp in Kent last year and is routine for just about any protest or action that is not some orderly march from point A to point B.
As the economic slump develops, more and more people will act to defend their jobs and their livelihoods. The police are being prepared for this by the sinister and secret Association of Chief Police Officers (ACPO). This is the organisation that did the Thatcher’s government’s bidding during the miners’ strike, which began 25 years ago. In the course of that dispute, a total of 11,000 miners were arrested, 7,000 injured, eleven people died, and 1,000 men were sacked. More than 100 were jailed.
The present capitalist state is clearly an alienating power that is undemocratic and more or less the plaything of the corporations and banks. The police, together with the army and the spy agencies, are this state’s enforcers and nothing will change their historic role. This should add to the urgency of developing a strategy for creating a new kind of political democracy. This would be founded on co-ownership and control of resources and require the replacement of institutions like the police with new forms of community control.
Paul FeldmanAWTW communications editor 8 April 2009http://www.aworldtowin.net/blog/law-unto-themselves.html

US court allows apartheid claims

2009-04-09T02:06:00.000-07:00

A United States judge has ruled that lawsuits can go ahead against several companies accused of helping South Africa's apartheid-era government.
IBM, Ford and General Motors are among those corporations now expected to face demands for damages from thousands of apartheid's victims.
They argue that the firms supplied equipment used by the South African security forces to suppress dissent.
The companies affected have not yet responded to the judge's ruling.
'Wilful blindness'
US District Judge Shira Scheindlin in New York dismissed complaints against several companies but said plaintiffs could proceed with lawsuits against IBM, Daimler, Ford, General Motors and Rheinmetall Group, the German parent of an armaments maker.
"Corporate defendants accused of merely doing business with the apartheid government of South Africa have been dismissed," she said.
The plaintiffs argue that the car manufacturers knew their vehicles would be used by South African forces to suppress dissent. They also say that computer companies knew their products were being used to help strip black South Africans of their rights.
The judge disagreed with IBM's argument that it was not the company's place to tell clients how to use its products.
"That level of wilful blindness in the face of crimes in violation of the law of nations cannot defeat an otherwise clear showing of knowledge that the assistance IBM provided would directly and substantially support apartheid," she said.
More than 50 companies were initially sued, but after a court demanded more specific details, the plaintiffs decided to target fewer companies.
The US and South African governments supported the companies' efforts to get the complaints dismissed.
They argue that the legal action is damaging to international relations and may threaten South Africa's economic development.

'Worse than the Taliban' - new law rolls back rights for Afghan women

2009-03-31T01:57:00.001-07:00

Jon Boone in Kabul
The Guardian, Tuesday 31 March 2009
Article history

A burqa-clad Afghan woman walks in an old bazaar in Kabul. Photograph: Ahmad Masood/REUTERS
Hamid Karzai has been accused of trying to win votes in Afghanistan's presidential election by backing a law the UN says legalises rape within marriage and bans wives from stepping outside their homes without their husbands' permission.
The Afghan president signed the law earlier this month, despite condemnation by human rights activists and some MPs that it flouts the constitution's equal rights provisions.
Jon Boone reveals Afghanistan's new law denying women's rights Link to this audio
The final document has not been published, but the law is believed to contain articles that rule women cannot leave the house without their husbands' permission, that they can only seek work, education or visit the doctor with their husbands' permission, and that they cannot refuse their husband sex.
A briefing document prepared by the United Nations Development Fund for Women also warns that the law grants custody of children to fathers and grandfathers only.
Senator Humaira Namati, a member of the upper house of the Afghan parliament, said the law was "worse than during the Taliban". "Anyone who spoke out was accused of being against Islam," she said.
The Afghan constitution allows for Shias, who are thought to represent about 10% of the population, to have a separate family law based on traditional Shia jurisprudence. But the constitution and various international treaties signed by Afghanistan guarantee equal rights for women.
Shinkai Zahine Karokhail, like other female parliamentarians, complained that after an initial deal the law was passed with unprecedented speed and limited debate. "They wanted to pass it almost like a secret negotiation," she said. "There were lots of things that we wanted to change, but they didn't want to discuss it because Karzai wants to please the Shia before the election."
Although the ministry of justice confirmed the bill was signed by Karzai at some point this month, there is confusion about the full contents of the final law, which human rights activists have struggled to obtain a copy of. The justice ministry said the law would not be published until various "technical problems" had been ironed out.
After seven years leading Afghanistan, Karzai is increasingly unpopular at home and abroad and the presidential election in August is expected to be extremely closely fought. A western diplomat said the law represented a "big tick in the box" for the powerful council of Shia clerics.
Leaders of the Hazara minority, which is regarded as the most important bloc of swing voters in the election, also demanded the new law.
Ustad Mohammad Akbari, an MP and the leader of a Hazara political party, said the president had supported the law in order to curry favour among the Hazaras. But he said the law actually protected women's rights.
"Men and women have equal rights under Islam but there are differences in the way men and women are created. Men are stronger and women are a little bit weaker; even in the west you do not see women working as firefighters."
Akbari said the law gave a woman the right to refuse sexual intercourse with her husband if she was unwell or had another reasonable "excuse". And he said a woman would not be obliged to remain in her house if an emergency forced her to leave without permission.
The international community has so far shied away from publicly questioning such a politically sensitive issue.
"It is going to be tricky to change because it gets us into territory of being accused of not respecting Afghan culture, which is always difficult," a western diplomat in Kabul admitted.
Soraya Sobhrang, the head of women's affairs at the Afghanistan Independent Human Rights Commission, said western silence had been "disastrous for women's rights in Afghanistan".
"What the international community has done is really shameful. If they had got more involved in the process when it was discussed in parliament we could have stopped it. Because of the election I am not sure we can change it now. It's too late for that."
But another senior western diplomat said foreign embassies would intervene when the law is finally published.
Some female politicians have taken a more pragmatic stance, saying their fight in parliament's lower house succeeded in improving the law, including raising the original proposed marriage age of girls from nine to 16 and removing completely provisions for temporary marriages.
"It's not really 100% perfect, but compared to the earlier drafts it's a huge improvement," said Shukria Barakzai, an MP. "Before this was passed family issues were decided by customary law, so this is a big improvement."
Karzai's spokesman declined to comment on the new law.

The horse has bolted

2009-03-31T01:55:00.000-07:00

Current and former leaders of global agencies are leap-frogging each other with increasingly dramatic attempts to give expression to the scale and rapidity of the disintegration and collapse of the world’s financial and economic systems. Their warnings contrast sharply with the feeble efforts of national government agencies like the UK’s Financial Services Authority (FSA).
Michel Camdessus, former managing director of the International Monetary Fund (IMF) went large last week, declaring: “This crisis is the first truly universal one in the history of humanity. No country escapes from it. It has not yet bottomed out.” He was foreshadowing yet another of the IMF’s series of ever-more pessimistic forecasts published yesterday that calmly predicts that the global economy will contract this year for the first time since World War II.Moreover, the impact in the UK will be more severe than in any other developed capitalist economy, the IMF warns. Figures on public finances confirm a rapid spiralling of state debt in the wake of the financial crisis, mounting unemployment and collapsing tax revenues. Next year, the IMF estimates that the Treasury will have to borrow a record 11% of gross domestic product – far more than has ever been borrowed before in British history and higher as a proportion of national wealth than in the United States.Camdessus’s observation makes the otherwise stunning admission in the opening sentences of the report on the global banking crisis from Lord Turner, head of the FSA look pretty tame in comparison. “Over the last 18 months, and with increasing intensity over the last six, the world’s financial system has gone through its greatest crisis for at least half a century, indeed arguably the greatest crisis in the history of finance capitalism,” he writes.After pointing the finger at New Labour for promoting “light touch regulation”, Turner admits that markets are irrational but then insists it’ll be OK, apparently, if we tighten regulations this time around. A phrase about shutting stable doors after the horse has bolted springs to mind.In common with most observers and analysts, Turner mistakenly attributes the global production shutdown, with unemployment spiralling to new records in every country, to bad behaviour in the world of finance. The real source of the crisis actually lies in the system of capitalist production whose expansion is founded on debt of all kinds.Following the 1929 crash, despite multiple failed attempts at government intervention, the crisis stretched throughout the 1930s becoming known in retrospect as the Great Depression. The Second World War reduced the no longer profitable pre-war surplus productive capacity to rubble and bloody corpses.Then, and only then, credit expansion freed the insatiable self-movement of capital expansion in post-war spurts of growth. These produced the transnational corporations, built on cheap labour and the wreckage from a series of worsening crises, and spawned the global financial system which has now disintegrated.Turner wants to get the carnival back on the road, replaying the same show, saying that the global economy needs “the existence of large complex banking institutions providing financial risk management products” which “inevitably involve at least some position taking”.This is wishful thinking. The crisis is incomparably deeper than any other time in history partly because no-one knows the size of the balloons of credit which have yet to burst and the real state of bank finances. For example, no one in government can actually account for the vast sums allocated to bank bail-outs in America and the UK. They have disappeared into a financial black hole.There’s an opportunity to discuss non-capitalist solutions and policies for this dangerous crisis at LEAP’s Capitalism isn’t Working conference next month.Gerry GoldEconomics editor 20 March 2009