The Corporate Debt Bubble Is A Train Wreck In Slow Motion

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By Brandon Smith

Source: Alt-Market.com

There are two subjects that the mainstream media seems specifically determined to avoid discussing these days when it comes to the economy – the first is the problem of falling global demand for goods and services; they absolutely refuse to acknowledge the fact that demand is going stagnant and will conjure all kinds of rationalizations to distract from the issue. The other subject is the debt bubble, the corporate debt bubble in particular.

These two factors alone guarantee a massive shock to the global economy and the US economy are built into the system, but I believe corporate debt is the key pillar of the false economy.  It has been utilized time and time again to keep the Everything Bubble from completely deflating, however, the fundamentals are starting to catch up to the fantasy.

For example, in terms of stock markets, which are now meaningless as an indicator of the health of the real economy, corporate stock buybacks have been the single most vital mechanism for inflation. Corporations buy their own stocks, often using cash borrowed from each other and from the Federal Reserve, in order to reduce the number of shares on the market and artificially boost the value of the remaining shares. This process is essentially legal manipulation of equities, and to be sure, it has been effective so far at keeping markets elevated.

The problem is that these same corporations are taking on more and more debt through interest payments in order to maintain the facade. Over the period of a decade, corporate debt has skyrocketed back to levels not seen since 2007, just before the credit crisis. The official corporate debt load now stands at over $10 trillion, and that’s not even counting derivatives exposure.  According to the Bank for International Settlements, the amount of derivatives still held by corporations stands at around $544 trillion in notional value (theoretical value), while the current market value is only around $10 trillion.  This is a massive discrepancy that can only lead to disaster.

In terms of debt-to-GDP, the credit cycle peak has spiked beyond any other peak in the past 40 years. This amount of borrowing always has consequences. Even if central banks were to intervene on a level similar to TARP, which saturated markets with $16 trillion in liquidity, the amount of cash needed is so immense and the economic returns so muted that such measures are ultimately a waste of time. The Federal Reserve fueled this bubble, and now there is no stopping it’s demise. Though, they’re behavior and minimal response to the problem suggests that they have no intention of stopping it anyway.

Currently, stock buybacks are set to decline this year, and I don’t think this is because corporations have decided they want to quit the tactic. They have to quit, because the amount of debt they are accumulating is is now outpacing their falling profits. Corporate profits peaked in the 3rd Quarter of 2018 and have been in decline ever since.  The Price-to-Earnings ratio as well as the Price-to-Sales ratio are now well above their historic peak during the dot-com bubble, meaning, stocks have never been more overvalued compared to the profits that corporations are actually bringing in.

As I warned back in 2018, Trump’s tax cuts were a gift to corporations, not average people, and that gift was designed to be squandered as there was no doubt that companies would pour all extra cash into stock buybacks instead of innovation and new jobs. This is exactly what happened.

While corporations, the Fed and Trump have been putting some effort into keeping stock markets from imploding, the real economy has been evaporating. Global import/exports are crashing, US manufacturing is in recession territory, US GDP is in decline (even according to rigged official numbers), US retail outlets are closing by the thousands, the poverty rate jumped in 30% of US counties in the past year, and high paying jobs are disappearing and being replaced with minimum wage service sector jobs.

To be sure, this process did not start under Trump, it’s been a slow motion train wreck for over a decade. But, it’s important to point out that Trump has done nothing to mitigate the crash and his obsession with the fraudulent stock market shows that he has no plans to try. The amount of time the tax cuts and debt increase bought was a couple of years. That’s it. With buybacks in decline, the question is what will keep the bubble afloat now? The Fed? That’s doubtful…

Global corporations with the most VISIBLE debt include:

AT&T with $180 billion

SoftBank with $154 billion

Apple with $136 billion

Verizon with $114 billion

Comcast with $112 billion

AbInbev with $110 billion

General Electric with $115 billion

Shell with $77 billion

Microsoft with $67 billion

Some companies, like Apple and Warren Buffet’s Berkshire Hathaway are holding extensive cash reserves, but most do not. Also, the level of cash reserves held by certain top corporations suggests they know something is on the horizon. Why hold piles of cash when the stock market is a “sure thing”? Unless, the debt bubble is about to collapse and cash will be needed to absorb the damage?

Stock buybacks, I believe, are the litmus test for how long the corporate world can hold out against the weight of the debt bubble. 2020 appears to be the year in which buybacks are set to crumble. Corporate profits degraded over 2019 and the slide is set to continue this year. This means profits are not going to come to the rescue and stave off the explosion of the debt structure (once again, the problems of demand and debt intertwine). All that is left is the Fed, as the “buyer of last resort” becomes the buyer of only import.

The list above, of course, does not include financial companies like JP Morgan and other banks that are suspected of harboring an extensive debt load and borrowing cash frantically through the Fed’s overnight repo markets.

These loans are now coming due, and the Fed has indicated it plans to tighten liquidity once again next month while returning to balance sheet cuts. Interest rates remain well above zero, which means the more companies borrow through repo markets, the more interest they will accrue. The Fed will have to institute a full QE program on the level of the TARP bailouts and cut interest rates to zero in order to end the constant repo liquidity threat and kick the can for a couple more years, and they’ve given no indication that they plan to do this in time to stop the current crash.

For now, Fed repo intervention has achieved little except keeping stocks at all-time highs. The rest of the economy is in disarray.

The real economy will start to drag down the establishment’s favorite distraction – The Dow, as this process continues. The big question is always one of timing. How long can the delusional euphoria keep the system levitated?

The situation is one of complacency and condition. If people are suddenly confronted with an enormous forest fire surrounding their city, they will ask “What can we do to save ourselves?” But what if people are surrounded by a forest fire for ten years and it hasn’t quite reached them yet? You warn them that the winds have finally changed and it is about to expand and take their homes and they will say “What forest fire?”

It’s hard to imagine a scenario in which there are no major shocks to the financial structure for the rest of the year. With the corporate system tapped out and no longer able to act as a support for the bubble, the fundamentals will start to take over again. Geopolitical events will also have a more visible effect. A whole year without escalation with Iran?  Without escalation with North Korea? Without a pandemic threat like the coronavirus going global? Without threats of a liquidity crisis as banks starve for more and more repo loans? I think not…

It’s important not to let complacency interfere with vigilance.  A slow motion train wreck is still ultimately a train wreck.  The damage can only be mitigated by removing one’s self from the train, and preparing for the fallout.  Do not think that simply because the system has been able to drag its nearly lifeless body along for ten years that this means all is well.  All bubbles collapse, and corporate debt has already sealed the fate of the Everything Bubble.

Passing the Point of No Return, A World War is Upon Us

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By Timothy Alexander Guzman

Source: Silent Crow News

War is inevitable. More innocent people will be murdered, maimed, raped or sold into slavery. War is indescribable, a nightmare, yet those who are currently in power, the establishment or what some like to call “the elite” are on Trump’s team leading the world into another war In the Middle East that can go nuclear. Trump has not drained the swamp, in fact he has filled his administration with war hawks, bankers, Zionists and the Neoconservatives (Neocons) who are all inter-connected to various corporations and special interests. It was reported by NBC news that Trump had actually approved the assassination of Iranian General Qassem Soleimani several months ago “President Donald Trump authorized the killing of Iranian Gen. Qassem Soleimani seven months ago if Iran’s increased aggression resulted in the death of an American, according to five current and former senior administration officials. The presidential directive in June came with the condition that Trump would have final signoff on any specific operation to kill Soleimani, officials said.” Trump’s decision to assassinate Iranian General Qasem Soleimani, a popular figure among Muslims and Christians who fought against ISIS, Al-Nusra and other terrorist organizations in Syria and Iraq was the powder keg that has exploded in the Middle East and now there is no turning back. Real terrorists were actually celebrating the death of Soleimani. RT news reported that “the weekly Islamic State (IS, formerly ISIS/ISIL) newspaper Al-Naba portrayed Soleimani’s death as an act of god in support of its cause, and Muslims in general, according to BBC Monitoring.” What was interesting was that “an editorial in the jihadi paper was careful not to credit the US or even mention Soleimani by name.” My guess is that terrorists know the rules, never rat on your friends! However, it’s also noteworthy to consider that the strike could lead ISIS and the other terrorist organizations to regroup as “the paper also reported on the US and its allies suspending operations against IS as an opportunity for the group’s resurgence, according to BBC journalist Mina Al-Lami.” The world will once again see a new push into Syria by ISIS and other terrorist groups with US and Israeli support in an effort to remove Syrian President, Bashar Al-Assad. That is why Russian President Vladimir Putin went to Syria for talks with President Assad as reported by RT news:

The two leaders were briefed on the military situation in Syria, including the northwestern province of Idlib, occupied by militants linked to Al-Qaeda. Assad thanked Putin and Russia for their support in restoring peace in Syria. Russian troops have been assisting the Syrian army since September 2015 in battling various terrorist groups, including Islamic State (IS, formerly ISIS)

All anti-US and anti-Israel movements from Lebanon to Iran and all the way to central Asia with Afghanistan and Pakistan are now united for one cause, and that is to end US presence in the Middle East by targeting all US bases, embassies and other installations.

I could just imagine what world leaders are thinking at this point, especially those who are in some form of conflict with Washington including Russia, China, Syria, Lebanon, Venezuela, Cuba, Nicaragua, Argentina, the Palestinians, Pakistan, past and re-emerging former Latin American presidents Lula de Silva of Brazil and Evo Morales of Bolivia, leaders from political, social and Indigenous movements including those within the US and occupied territories must be saying to themselves: What will America do to us? Would they drone strike me if I don’t obey them? The Trump regime has stepped-up its economic wars with sanctions that has caused mass suffering among populations in the Middle East with Iran and Syria as their targets and in Latin America with Venezuela and don’t forget that 59 year embargo on Cuba that Trump has kept going, so Trump is already a war president. Trump is a typical example of what you would call a “Chicken hawk” a term particularly used in the US which is defined by Wikipedia as “a person who strongly supports war or other military action yet who actively avoids or avoided military service when of age.” Newsweek magazine reported that “In all, Trump secured five deferments from the Vietnam War draft, four of which were because he was still studying at college. The fifth and final deferment was granted on medical grounds after a doctor signed Trump off as having bone spurs in his heels.” The article also claimed the following:

The daughters of the late podiatrist in question, Dr. Larry Braunstein, told The New York Times that their father did it as a favor to Fred Trump, the president’s father, who owned the building in which the doctor had an office. They said the suggestion from their father in his oft-told story was that Trump did not have a foot problem that should have disqualified him from the Vietnam troop drafts, and it was not clear if the podiatrist had ever examined him

I do not know if the claims made by Newsweek or The New York Times who have credibility issues are true or not, but if Dr. Larry Braunstein did do Trump’s father a favor, then it should be of no surprise because many wealthy people especially those in the East Coast of the United States did have the right connections to pull the strings to prevent their children from getting drafted into the Vietnam war. However, Trump has committed young men and women who mostly come from poor families to the coming war effort against Iran. Not only will US forces be fighting another war for oil and other natural resources, they will be fighting for Israel. Trump decisions concerning Israel has made his close friend and ally, Prime Minister Benjamin Netanyahu very happy because Israel needs Iran and Syria to become another Iraq. US troops will be used for the protection and expansion of Israel who will become a powerful player in the Middle East with nuclear weapons. One thing is certain, the Muslim world is not going to except that under any circumstances.

Prepare Now, The War Has Begun

A report by the Financial Times on December 27th, 2019 ‘Russia, China and Iran Launch Gulf of Oman War Games’:

Russia, China and Iran launched their first joint naval exercises in the Gulf of Oman on Friday in a direct challenge to US influence in the Middle East. The move reflects growing co-operation between the US’s two main rivals and the Islamic republic, which is under sanctions imposed by Washington. 

“The most important achievement of these drills . . . is this message that the Islamic republic of Iran cannot be isolated,” vice-admiral Gholamreza Tahani, a deputy naval commander, said. “These exercises show that relations between Iran, Russia and China have reached a new high level while this trend will continue in the coming years” 

After Trump’s reckless strike against Soleimani, Russia and China quickly condemned the actions. It was reported by RT news that “Moscow considers the operation “an adventurous move that will lead to an escalation of tension throughout the region.” China’s response was similar. CNBC reported that Chinese Foreign Minister Wang Yi had said that “China opposes the use of force in international relations” and that “Military means will lead nowhere. Maximum pressure won’t work either. China urges the U.S. to seek resolutions through dialogue instead of abusing force.” China will be monitoring the crisis very closely “China will continue to uphold an objective and just position and play a constructive role in safeguarding peace and security in the Gulf region of the Middle East.“ Trump and the neoconservatives have now escalated tensions in the Middle East and in almost every region in the world with economic sanctions, failed coup attempts on Venezuela’s President Nicolas Maduro and the other coup that succeeded in Bolivia. The Trump regime also managed to instigate a trade war with China while funding protests in Hong Kong to create instability in Asia and the list goes on.

A new resistance has become a reality in the Middle East that will eventually force US troops out of the region. Expect more anti-war protests to grow substantially across the world as the US and its allies become more aggressive. The US economy is also collapsing, putting its own national security at risk with a $22 trillion in debt because let’s face it, when the US economy collapses, all of the debt bubbles will pop and all hell will break out across the US. However, Trump proudly tweeted that “The United States just spent Two Trillion Dollars on Military Equipment. We are the biggest and by far the BEST in the World! If Iran attacks an American Base, or any American, we will be sending some of that brand new beautiful equipment their way…and without hesitation!” There is a new neoconservative movement within the Trump White House driving foreign policy in the Middle East with Secretary of State Mike Pompeo and Vice-President Mike Pence leading the charge thus bringing back the memories of the Bush Neocons.  Let’s go back to an interesting Christian Science Monitor article from 2003 which can also be found on Global Research that describes what the Neocons believe in. The article ‘Neocon 101: What do Neoconservatives Believe?’ said the following:

What does a neoconservative dream world look like? Neocons envision a world in which the United States is the unchallenged superpower, immune to threats. They believe that the US has a responsibility to act as a “benevolent global hegemon.” In this capacity, the US would maintain an empire of sorts by helping to create democratic, economically liberal governments in place of “failed states” or oppressive regimes they deem threatening to the US or its interests. In the neocon dream world the entire Middle East would be democratized in the belief that this would eliminate a prime breeding ground for terrorists. This approach, they claim, is not only best for the US; it is best for the world. In their view, the world can only achieve peace through strong US leadership backed with credible force, not weak treaties to be disrespected by tyrants.  

Any regime that is outwardly hostile to the US and could pose a threat would be confronted aggressively, not “appeased” or merely contained. The US military would be reconfigured around the world to allow for greater flexibility and quicker deployment to hot spots in the Middle East, as well as Central and Southeast Asia. The US would spend more on defense, particularly for high-tech, precision weaponry that could be used in preemptive strikes. It would work through multilateral institutions such as the United Nations when possible, but must never be constrained from acting in its best interests whenever necessary

In an important note, neoconservative ideology is not limited to the Republicans. Glenn Greenwald of The Intercept published a report in 2017 titled ‘With New D.C. Policy Group, Dems Continue to Rehabilitate and Unify With Bush-Era Neocons’ pointed out that “one of the most under-discussed yet consequential changes in the American political landscape is the reunion between the Democratic Party and the country’s most extreme and discredited neocons.” The report continued:

A newly formed and, by all appearances, well-funded national security advocacy group, devoted to more hawkish U.S. policies toward Russia and other adversaries, provides the most vivid evidence yet of this alliance. Calling itself the Alliance for Securing Democracy, the group describes itself as “a bipartisan, transatlantic initiative” that “will develop comprehensive strategies to defend against, deter, and raise the costs on Russian and other state actors’ efforts to undermine democracy and democratic institutions,” and also “will work to publicly document and expose Vladimir Putin’s ongoing efforts to subvert democracy in the United States and Europe.” 

It is, in fact, the ultimate union of mainstream Democratic foreign policy officials and the world’s most militant, and militaristic, neocons. The group is led by two longtime Washington foreign policy hands, one from the establishment Democratic wing and the other a key figure among leading GOP neocons. 

The Democrat, Laura Rosenberger, served as a foreign policy adviser for Hillary Clinton’s 2016 presidential campaign and chief of staff to two Obama national security officials. The Republican is Jamie Fly, who spent the last four years as counselor for foreign and national security affairs to one of the Senate’s most hawkish members, Marco Rubio; prior to that, he served in various capacities in the Bush Pentagon and National Security Council 

The neocons are back in the White House, reminiscent of the Bush regime, so another war is on the table. Be prepared, for the worst is yet to come.

 

Come Home, America: Stop Policing the Globe and Put an End to Wars-Without-End

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By Jon W. Whitehead

Source: The Rutherford Institute

“Let us resolve that never again will we send the precious young blood of this country to die trying to prop up a corrupt military dictatorship abroad. This is also the time to turn away from excessive preoccupation overseas to the rebuilding of our own nation. America must be restored to a proper role in the world. But we can do that only through the recovery of confidence in ourselves…. together we will call America home to the ideals that nourished us from the beginning. From secrecy and deception in high places; come home, America. From military spending so wasteful that it weakens our nation; come home, America.”—George S. McGovern, former Senator and presidential candidate

I agree wholeheartedly with George S. McGovern, a former Senator and presidential candidate who opposed the Vietnam War, about one thing: I’m sick of old men dreaming up wars for young men to die in.

It’s time to bring our troops home.

Bring them home from Somalia, Afghanistan, Iraq and Syria. Bring them home from Germany, South Korea and Japan. Bring them home from Saudi Arabia, Jordan and Oman. Bring them home from Niger, Chad and Mali. Bring them home from Turkey, the Philippines, and northern Australia.

That’s not what’s going to happen, of course.

The U.S. military reportedly has more than 1.3 million men and women on active duty, with more than 200,000 of them stationed overseas in nearly every country in the world. Those numbers are likely significantly higher in keeping with the Pentagon’s policy of not fully disclosing where and how many troops are deployed for the sake of “operational security and denying the enemy any advantage.” As investigative journalist David Vine explains, “Although few Americans realize it, the United States likely has more bases in foreign lands than any other people, nation, or empire in history.”

Don’t fall for the propaganda, though: America’s military forces aren’t being deployed abroad to protect our freedoms here at home. Rather, they’re being used to guard oil fields, build foreign infrastructure and protect the financial interests of the corporate elite. In fact, the United States military spends about $81 billion a year just to protect oil supplies around the world.

The reach of America’s military empire includes close to 800 bases in as many as 160 countries, operated at a cost of more than $156 billion annually. As Vine reports, “Even US military resorts and recreation areas in places like the Bavarian Alps and Seoul, South Korea, are bases of a kind. Worldwide, the military runs more than 170 golf courses.”

This is how a military empire occupies the globe.

Already, American military servicepeople are being deployed to far-flung places in the Middle East and elsewhere in anticipation of the war drums being sounded over Iran.

This Iran crisis, salivated over by the neocons since prior to the Iraq War and manufactured by war hawks who want to jumpstart the next world war, has been a long time coming.

Donald Trump, Barack Obama, George W. Bush, Bill Clinton: they all have done their part to ensure that the military industrial complex can continue to get rich at taxpayer expense.

Take President Trump, for instance.

Despite numerous campaign promises to stop America’s “endless wars,” once elected, Trump has done a complete about-face, deploying greater numbers of troops to the Middle East, ramping up the war rhetoric, and padding the pockets of defense contractors. Indeed, Trump is even refusing to withdraw U.S. troops from Iraq in the face of a request from the Iraqi government for us to leave.

Obama was no different: he also pledged—if elected—to bring the troops home from Iraq and Afghanistan and reduce America’s oversized, and overly costly, military footprint in the world. Of course, that didn’t happen.

Yet while the rationale may keep changing for why American military forces are policing the globe, these wars abroad (in Iraq, Afghanistan, Pakistan, Syria, Yemen and now Iran) aren’t making America—or the rest of the world—any safer, are certainly not making America great again, and are undeniably digging the U.S. deeper into debt.

War spending is bankrupting America.

Although the U.S. constitutes only 5% of the world’s population, America boasts almost 50% of the world’s total military expenditure, spending more on the military than the next 19 biggest spending nations combined.

In fact, the Pentagon spends more on war than all 50 states combined spend on health, education, welfare, and safety.

The American military-industrial complex has erected an empire unsurpassed in history in its breadth and scope, one dedicated to conducting perpetual warfare throughout the earth.

Since 2001, the U.S. government has spent more than $4.7 trillion waging its endless wars.

Having been co-opted by greedy defense contractors, corrupt politicians and incompetent government officials, America’s expanding military empire is bleeding the country dry at a rate of more than $32 million per hour.

In fact, the U.S. government has spent more money every five seconds in Iraq than the average American earns in a year.

Future wars and military exercises waged around the globe are expected to push the total bill upwards of $12 trillion by 2053.

Talk about fiscally irresponsible: the U.S. government is spending money it doesn’t have on a military empire it can’t afford.

As investigative journalist Uri Friedman puts it, for more than 15 years now, the United States has been fighting terrorism with a credit card, “essentially bankrolling the wars with debt, in the form of purchases of U.S. Treasury bonds by U.S.-based entities like pension funds and state and local governments, and by countries like China and Japan.”

War is not cheap, but it becomes outrageously costly when you factor in government incompetence, fraud, and greedy contractors. Indeed, a leading accounting firm concluded that one of the Pentagon’s largest agencies “can’t account for hundreds of millions of dollars’ worth of spending.”

Unfortunately, the outlook isn’t much better for the spending that can be tracked.

A government audit found that defense contractor Boeing has been massively overcharging taxpayers for mundane parts, resulting in tens of millions of dollars in overspending. As the report noted, the American taxpayer paid:

$71 for a metal pin that should cost just 4 cents; $644.75 for a small gear smaller than a dime that sells for $12.51: more than a 5,100 percent increase in price. $1,678.61 for another tiny part, also smaller than a dime, that could have been bought within DoD for $7.71: a 21,000 percent increase. $71.01 for a straight, thin metal pin that DoD had on hand, unused by the tens of thousands, for 4 cents: an increase of over 177,000 percent.

That price gouging has become an accepted form of corruption within the American military empire is a sad statement on how little control “we the people” have over our runaway government.

Mind you, this isn’t just corrupt behavior. It’s deadly, downright immoral behavior.

Americans have thus far allowed themselves to be spoon-fed a steady diet of pro-war propaganda that keeps them content to wave flags with patriotic fervor and less inclined to look too closely at the mounting body counts, the ruined lives, the ravaged countries, the blowback arising from ill-advised targeted-drone killings and bombing campaigns in foreign lands, or the transformation of our own homeland into a warzone.

That needs to change.

The U.S. government is not making the world any safer. It’s making the world more dangerous. It is estimated that the U.S. military drops a bomb somewhere in the world every 12 minutes. Since 9/11, the United States government has directly contributed to the deaths of around 500,000 human beings. Every one of those deaths was paid for with taxpayer funds.

The U.S. government is not making America any safer. It’s exposing American citizens to alarming levels of blowback, a CIA term referring to the unintended consequences of the U.S. government’s international activities. Chalmers Johnson, a former CIA consultant, repeatedly warned that America’s use of its military to gain power over the global economy would result in devastating blowback.

The 9/11 attacks were blowback. The Boston Marathon Bombing was blowback. The attempted Times Square bomber was blowback. The Fort Hood shooter, a major in the U.S. Army, was blowback.

The assassination of Iranian General Qasem Soleimani by a U.S. military drone strike will, I fear, spur yet more blowback against the American people.

The war hawks’ militarization of America—bringing home the spoils of war (the military tanks, grenade launchers, Kevlar helmets, assault rifles, gas masks, ammunition, battering rams, night vision binoculars, etc.) and handing them over to local police, thereby turning America into a battlefield—is also blowback.

James Madison was right: “No nation could preserve its freedom in the midst of continual warfare.” As Madison explained, “Of all the enemies to public liberty war is, perhaps, the most to be dreaded because it comprises and develops the germ of every other. War is the parent of armies; from these proceed debts and taxes… known instruments for bringing the many under the domination of the few.”

We are seeing this play out before our eyes.

The government is destabilizing the economy, destroying the national infrastructure through neglect and a lack of resources, and turning taxpayer dollars into blood money with its endless wars, drone strikes and mounting death tolls.

Clearly, our national priorities are in desperate need of an overhauling.

At the height of its power, even the mighty Roman Empire could not stare down a collapsing economy and a burgeoning military. Prolonged periods of war and false economic prosperity largely led to its demise. As historian Chalmers Johnson predicts:

The fate of previous democratic empires suggests that such a conflict is unsustainable and will be resolved in one of two ways. Rome attempted to keep its empire and lost its democracy. Britain chose to remain democratic and in the process let go its empire. Intentionally or not, the people of the United States already are well embarked upon the course of non-democratic empire.

This is the “unwarranted influence, whether sought or unsought, by the military-industrial complex” that President Dwight Eisenhower warned us more than 50 years ago not to let endanger our liberties or democratic processes.

Eisenhower, who served as Supreme Commander of the Allied forces in Europe during World War II, was alarmed by the rise of the profit-driven war machine that emerged following the war—one that, in order to perpetuate itself, would have to keep waging war.

We failed to heed his warning.

As I make clear in my book Battlefield America: The War on the American People, there’s not much time left before we reach the zero hour.

It’s time to stop policing the globe, end these wars-without-end, and bring the troops home before it’s too late.

Epistemological divide: How we live in two different worlds of understanding

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By Kurt Cobb

Source: Resilience

Epistemology is the study of how we know things. All of us cycle between two main ways of knowing in our modern culture: 1) the rational, reductionist way and 2) the holistic, relational, intuitive way. By far the most dominant way is the rational, reductionist way and our institutions, scientific, economic, financial and organizational are governed by this way of thinking.

For the reductionist thinker, everything in the universe is made up of parts. If we can understand the parts, we can understand the whole. Depending on the field, the physical world is nothing but atoms and molecules and the social world is nothing but self-maximizing, rational actors. The reductionist view is very powerful and filled with “nothing but” statements. It never occurs to the thoroughgoing reductionist that the idea of “parts” is merely a mental construct.

In our everyday relationships with friends and family, in our nonrational pursuits in music and the arts, in our religious lives, we tend toward the second way of thinking, holistic, relational and intuitive.

We cycle back and forth between these ways of knowing almost effortlessly and for the most part unconsciously. That seems to work well for us as individuals—except when we miscalculate or misperceive a situation and bad consequences follow. Mostly, we regroup and recover and go on, adjusting for what we have learned.

Can the same be said of society as a whole? Yes and no. Global human society can be likened to a superorganism that has its own logic and modes of action. Each of us is strongly influenced by its trajectory and constrained in our actions. We may wish fervently to address income inequality or hunger or climate change. But the complex interactions and power arrangements in our global society make it difficult to do anything but make a small dent. Even our personal destinies seem to be caught up in a flow of events which we cannot control, but rather must react to.

The reductionist way suggests mastery through manipulation of carefully measured forces: mass, temperature, vectors of force, energy gradients (both physical and chemical). We build machines that use energy to build yet more machines. We erect great public works, dams, bridges and roads that create the arteries through which commerce and people flow. We douse the land with chemical fertilizers boosting farm yields to feed hungry billions.

The holistic way suggests mastery through alignment with natural and social forces. We say that it is best to “go with the flow” in both the physical and social dimensions of our lives. Such words imply an intuitive apprehension of an entire pattern. Recognition of patterns becomes the master key to understand the world. But what is a pattern? It is certainly something that repeats, but not always exactly.

Mark Twain is often quoted as saying,”History never repeats itself but it does rhyme.” The mystery of comparison is the engine of perception, cognition and our resulting cultural outputs of literature, art and music.

The holistic way tries to see the entire picture including all the messy consequences. Knowing that those consequences ramify infinitely, it can only intuit the extent and significance of any pattern. The holistic way knows ahead of time that it will never see the whole, only “feel” its meaning.

Both ways are general approaches to modeling the world we see. We create mental models of how the world works and fits together. When we mistake those models for “the truth,” we can get stuck, failing to adjust to new information and experience. We begin to dismiss information contrary to our model rather than embracing such information as a new insight for our process of adjustment. You can hear the dismissal happening when people say, “That can’t be” or “Everybody knows that…”

Heraclitus says, “Nothing endures but change.” The global superorganism—described by Nate Hagens in the piece cited above entitled, “Economics for the future – Beyond the superorganism”—keeps changing but in a direction that constantly undermines the survivability of humankind (and many other organisms and animals). That organism perceives the world as parts to be controlled and exploited, not just partially and temporarily, but completely and permanently. The perception that the universe is a seamless whole where a victory of mastery in one place means a perilous defeat in another, never occurs to this superorganism.

As Hagens describes it, the global human superorganism does not understand that there is a future in which the consequences of its actions will be manifested in a colossal systemic collapse. There is only the hungry maw of now, of immediate control and mastery, of immediate gratification, of immediate power.

The point is not to banish the reductionist way of thinking. Rather, it is to recognize it for what it is, but one model of perception that has its limitations and will never embrace the entire universe—a model that is as prone to error as any other model and one that will never get close to “the truth” because as Heraclitus tells us, “the truth” of the universe is always changing.

Saturday Matinee: The Dead Zone

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“The Dead Zone” (1983) is a horror/drama directed by David Cronenberg based on a novel by Stephen King. When Johnny Smith (Christopher Walken) awakens from a coma caused by a car accident, he finds that years have passed. Heartbroken that his girlfriend (Brooke Adams) has moved on, Johnny must also contend with new unsettling powers allowing him to see a person’s future with a mere touch. After shaking the hand of aspiring politician Greg Stillson (Martin Sheen), Johnny sees the impending danger presented by the candidate’s victory and resolves to prevent it.

Watch the full film on Crackle here.

CONFIRMED: Israeli Supplied the Key Intelligence for US Assassination of Iran’s Soleimani

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By Patrick Henningsen

Source: 21st Century Wire

This latest revelation should not surprise anyone who has been actively following the exploits of the current Trump Administration and its partner organization, Israel’s Netanyahu government.

According to a recent report released by the Times of Israel, it was officials in Tel Aviv who provided the White House with the key intelligence details leading to the targeted double assassination of Iranian Quds Force leader, General Qasem Soleimani, and senior Iraqi PMU commander, Abu Mahdi al-Muhandis, on January 3rd.

The illegal assassinations prompted an Iranian missile strike on two US bases in Iraq, and bringing Washington and Tehran dangerously close to a larger military confrontation, until Trump stood down in the face of reprisals by Iran and its allies in the region.

This latest news also validates previous analysis by 21WIRE which concluded that Israel has been the primary source of “intelligence” provided to the White House, relating to the recent chain of events involving the United States, Iraq and Iran.

Netanyahu Lied About Involvement

This also indicates that Israeli PM Benjamin Netanyahu was lying last week when he told ministers that the killing of Soleimani was “carried out solely by the US,” and that Israel was not involved. According to Axios:

“Netanyahu told Security Cabinet ministers Monday that the killing of Iranian Gen. Qasem Soleimani was carried out solely by the U.S. and that Israel was not involved in any way and must not be dragged into the escalating conflict, two ministers who attended the meeting told me.”

This calculated move to walk-back his previously hawkish stance on Soleimani and Iran appears to have been a shrewd and cynical political maneuver to avoid being implicated in the political maelstrom which ensued in Washington – where US Senators and Congressional Representatives were demanding the White House present any of the illusive intelligence relating to the successive incidents. Their calls were met with complete stonewalling from the Trump Administration who claimed that any discussion into the matter would be ‘helping the enemy.’

The question now is whether or not Israel also provided the White House the illusive intelligence that prompted Trump’s illegal assassination orders – the mysterious intelligence which claimed there were “imminent threats” to the United States. Elected representatives are still waiting.

The new reports now reveal how Israeli intelligence officials provided President Trump the location and reconnaissance data which resulted in the state-sanctioned murder of Soleimani. Details of the operation also appeared in an NBC News report:

Armed with a tip from informants at the airport in the Syrian capital of Damascus, the CIA knew exactly when a jet carrying Iranian Gen. Qassem Soleimani took off en route to Baghdad. Intelligence from Israel helped confirm the details.

Once the Cham Wings Airlines Airbus A320 landed, American spies at Iraq’s main airport, which houses U.S. military personnel, confirmed its exact whereabouts.

Three American drones moved into position overhead, with no fear of challenge in an Iraqi airspace completely dominated by the U.S. military. Each was armed with four Hellfire missiles.

(…) On large screens, various U.S. officials watched as an Iraqi militia leader walked up a set of stairs to greet the leader of Iran’s Quds Force as he emerged from the airplane. It was past 1 in the morning, so the black and white infrared imagery wasn’t very clear. No faces could be seen.

It is important to note that from the onset of the Trump presidency, Israel has played a visible role in directing US policy regarding Iran. In fact, the current round of hostilities between the US and Iran was started when the White House unilaterally withdrew from the landmark international JCPOA Iran Nuclear Agreement in May 2018. Leaked recordings reveal that Israeli PM Benjamin Netanyahu boasted about his own role in convincing the White House to unilaterally withdraw from the JCPOA deal.

Butcher of the Worst Kind: The Deeper Story Behind Trump’s Assassination of Soleimani

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BAGHDAD, IRAQ – JANUARY 05: Iraqi Prime Minister Adel Abdul-Mahdi (L) attends an Iraqi parliament session in Baghdad, Iraq, 05 January 2020. Iraqi parliamentarians attended a session to discuss the presence of US forces in the country after Qasem Soleimani, the head of Iran’s Revolutionary Guards’ elite Quds force, was killed in a U.S. drone airstrike in Iraq. (Photo by Iraqi prime minister office /Handout/Anadolu Agency via Getty Images)

By Federico Pieraccini

Source: Covert Geopolitics

Mainstream media pundits are now talking about “de-escalation” between Iran and the US, after “both sides have fooled everyone that they have achieved victory.” Is that how cheap the life of a man who dedicated his better days fighting against the Deep State controlled ISIS and Al Qaeda terror groups?

Most people in the West believed as Trump, the Democrats, and the CIA mainstream media, were saying that Soleimani was a terrorist, who orchestrated the killing of hundreds of US troops and civilians throughout the Middle East. Yet, it was the US Air Force planes which were airdropping military supplies to terrorist positions in Syria.

It was Gen. Soleimani who directed and coordinated the movements of different forces which successfully averted the fall of Syria and Iraq during the onslaught of ISIS terror in 2011 and onwards. All sides of the conflict have acknowledged the key role played by Soleimani in counter-terrorism.

What has transpired immediately prior to the assassination of Gen. Soleimani should give the Americans an overview of the true nature of the Trump presidency, amidst their high expectations of a meaningful change away from their endless wars abroad.

The Deeper Story Behind the Assassination of Soleimani

Days after the assassination of General Qasem Soleimani, new and important information is coming to light from a speech given by the Iraqi prime minister. The story behind Soleimani’s assassination seems to go much deeper than what has thus far been reported, involving Saudi Arabia and China as well the U.S. dollar’s role as the global reserve currency.

The Iraqi prime minister, Adil Abdul-Mahdi, has revealed details of his interactions with Trump in the weeks leading up to Soleimani’s assassination in a speech to the Iraqi parliament. He tried to explain several times on live television how Washington had been browbeating him and other Iraqi members of parliament to toe the American line, even threatening to engage in false-flag sniper shootings of both protesters and security personnel in order to inflame the situation, recalling similar modi operandi seen in Cairo in 2009, Libya in 2011, and Maidan in 2014. The purpose of such cynicism was to throw Iraq into chaos.

Here is the reconstruction of the story:

[Speaker of the Council of Representatives of Iraq] Halbousi attended the parliamentary session while almost none of the Sunni members did. This was because the Americans had learned that Abdul-Mehdi was planning to reveal sensitive secrets in the session and sent Halbousi to prevent this. Halbousi cut Abdul-Mehdi off at the commencement of his speech and then asked for the live airing of the session to be stopped. After this, Halbousi together with other members, sat next to Abdul-Mehdi, speaking openly with him but without it being recorded. This is what was discussed in that session that was not broadcast: 

Abdul-Mehdi spoke angrily about how the Americans had ruined the country and now refused to complete infrastructure and electricity grid projects unless they were promised 50% of oil revenues, which Abdul-Mehdi refused.

The complete (translated) words of Abdul-Mahdi’s speech to parliament:

This is why I visited China and signed an important agreement with them to undertake the construction instead. Upon my return, Trump called me to ask me to reject this agreement. When I refused, he threatened to unleash huge demonstrations against me that would end my premiership.

Huge demonstrations against me duly materialized and Trump called again to threaten that if I did not comply with his demands, then he would have Marine snipers on tall buildings target protesters and security personnel alike in order to pressure me.

I refused again and handed in my resignation. To this day the Americans insist on us rescinding our deal with the Chinese.

After this, when our Minister of Defense publicly stated that a third party was targeting both protestors and security personnel alike (just as Trump had threatened he would do), I received a new call from Trump threatening to kill both me and the Minister of Defense if we kept on talking about this “third party”.

Nobody imagined that the threat was to be applied to General Soleimani, but it was difficult for Prime Minister Adil Abdul-Mahdi to reveal the weekslong backstory behind the terrorist attack.

I was supposed to meet him [Soleimani] later in the morning when he was killed. He came to deliver a message from Iran in response to the message we had delivered to the Iranians from the Saudis.

We can surmise, judging by Saudi Arabia’s reaction, that some kind of negotiation was going on between Tehran and Riyadh:

The Kingdom’s statement regarding the events in Iraq stresses the Kingdom’s view of the importance of de-escalation to save the countries of the region and their people from the risks of any escalation.

Above all, the Saudi Royal family wanted to let people know immediately that they had not been informed of the U.S. operation:

The kingdom of Saudi Arabia was not consulted regarding the U.S. strike. In light of the rapid developments, the Kingdom stresses the importance of exercising restraint to guard against all acts that may lead to escalation, with severe consequences.

And to emphasize his reluctance for war, Mohammad bin Salman sent a delegation to the United States. Liz Sly, the Washington Post Beirut bureau chief, tweeted:

Saudi Arabia is sending a delegation to Washington to urge restraint with Iran on behalf of [Persian] Gulf states. The message will be: ‘Please spare us the pain of going through another war’.

What clearly emerges is that the success of the operation against Soleimani had nothing to do with the intelligence gathering of the U.S. or Israel. It was known to all and sundry that Soleimani was heading to Baghdad in a diplomatic capacity that acknowledged Iraq’s efforts to mediate a solution to the regional crisis with Saudi Arabia.

It would seem that the Saudis, Iranians and Iraqis were well on the way towards averting a regional conflict involving Syria, Iraq and Yemen. Riyadh’s reaction to the American strike evinced no public joy or celebration. Qatar, while not seeing eye to eye with Riyadh on many issues, also immediately expressed solidarity with Tehran, hosting a meeting at a senior government level with Mohammad Zarif Jarif, the Iranian foreign minister. Even Turkey and Egypt, when commenting on the asassination, employed moderating language.

This could reflect a fear of being on the receiving end of Iran’s retaliation. Qatar, the country from which the drone that killed Soleimani took off, is only a stone’s throw away from Iran, situated on the other side of the Strait of Hormuz. Riyadh and Tel Aviv, Tehran’s regional enemies, both know that a military conflict with Iran would mean the end of the Saudi royal family.

When the words of the Iraqi prime minister are linked back to the geopolitical and energy agreements in the region, then the worrying picture starts to emerge of a desperate U.S. lashing out at a world turning its back on a unipolar world order in favor of the emerging multipolar about which I have long written.

The US, now considering itself a net energy exporter as a result of the shale-oil revolution (on which the jury is still out), no longer needs to import oil from the Middle East. However, this does not mean that oil can now be traded in any other currency other than the U.S. dollar.

The petrodollar is what ensures that the U.S. dollar retains its status as the global reserve currency, granting the U.S. a monopolistic position from which it derives enormous benefits from playing the role of regional hegemon.

This privileged position of holding the global reserve currency also ensures that the U.S. can easily fund its war machine by virtue of the fact that much of the world is obliged to buy its treasury bonds that it is simply able to conjure out of thin air. To threaten this comfortable arrangement is to threaten Washington’s global power.

Even so, the geopolitical and economic trend is inexorably towards a multipolar world order, with China increasingly playing a leading role, especially in the Middle East and South America.

Venezuela, Russia, Iran, Iraq, Qatar and Saudi Arabia together make up the overwhelming majority of oil and gas reserves in the world. The first three have an elevated relationship with Beijing and are very much in the multipolar camp, something that China and Russia are keen to further consolidate in order to ensure the future growth for the Eurasian supercontinent without war and conflict.

Saudi Arabia, on the other hand, is pro-US but could gravitate towards the Sino-Russian camp both militarily and in terms of energy. The same process is going on with Iraq and Qatar thanks to Washington’s numerous strategic errors in the region starting from Iraq in 2003, Libya in 2011 and Syria and Yemen in recent years.

The agreement between Iraq and China is a prime example of how Beijing intends to use the Iraq-Iran-Syria troika to revive the Middle East and and link it to the Chinese Belt and Road Initiative.

While Doha and Riyadh would be the first to suffer economically from such an agreement, Beijing’s economic power is such that, with its win-win approach, there is room for everyone.

Saudi Arabia provides China with most of its oil and Qatar, together with the Russian Federation, supply China with most of its LNG needs, which lines up with Xi Jinping’s 2030 vision that aims to greatly reduce polluting emissions.

The U.S. is absent in this picture, with little ability to influence events or offer any appealing economic alternatives.

Washington would like to prevent any Eurasian integration by unleashing chaos and destruction in the region, and killing Soleimani served this purpose.  The U.S. cannot contemplate the idea of the dollar losing its status as the global reserve currency. Trump is engaging in a desperate gamble that could have disastrous consequences.

The region, in a worst-case scenario, could be engulfed in a devastating war involving multiple countries. Oil refineries could be destroyed all across the region, a quarter of the world’s oil transit could be blocked, oil prices would skyrocket ($200-$300 a barrel) and dozens of countries would be plunged into a global financial crisis. The blame would be laid squarely at Trump’s feet, ending his chances for re-election.

To try and keep everyone in line, Washington is left to resort to terrorism, lies and unspecified threats of visiting destruction on friends and enemies alike.

Trump has evidently been convinced by someone that the U.S. can do without the Middle East, that it can do without allies in the region, and that nobody would ever dare to sell oil in any other currency than the U.S. dollar.

Soleimani’s death is the result of a convergence of U.S. and Israeli interests. With no other way of halting Eurasian integration, Washington can only throw the region into chaos by targeting countries like Iran, Iraq and Syria that are central to the Eurasian project. While Israel has never had the ability or audacity to carry out such an assassination itself, the importance of the Israel Lobby to Trump’s electoral success would have influenced his decision, all the more so in an election year.

Trump believed his drone attack could solve all his problems by frightening his opponents, winning the support of his voters (by equating Soleimani’s assassination to Osama bin Laden’s), and sending a warning to Arab countries of the dangers of deepening their ties with China.

The assassination of Soleimani is the U.S. lashing out at its steady loss of influence in the region. The Iraqi attempt to mediate a lasting peace between Iran and Saudi Arabia has been scuppered by the U.S. and Israel’s determination to prevent peace in the region and instead increase chaos and instability.

Washington has not achieved its hegemonic status through a preference for diplomacy and calm dialogue, and Trump has no intention of departing from this approach.

Washington’s friends and enemies alike must acknowledge this reality and implement the countermeasures necessary to contain the madness.

 

Federico Pieraccini is an independent freelance writer specialized in international affairs, conflicts, politics and strategies.