Monthly Archives: November 2018

Cultural/Ideological Divide

Turn Off, Tune Out, Drop Out – Small Business On The Brink

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Authored by Charles Hugh Smith via OfTwoMinds blog,

An unknown but likely staggeringly large percentage of small business owners in the U.S. are an inch away from calling it quits and closing shop.

Timothy Leary famously coined the definitive 60s counterculture phrase, “Turn on, tune in, drop out” in 1966. (According to Wikipedia, In a 1988 interview with Neil Strauss, Leary said the slogan was “given to him” by Marshall McLuhan during a lunch in New York City.)

An updated version of the slogan might be: Turn Off, Tune Out, Drop Out: turn off mobile phones, screens, etc.; tune out Corporate Media, social media, propaganda, official and unofficial, and drop out of the status quo economy and society.

Dropping out of a broken, dysfunctional status quo in terminal decline has a long history. The chapter titles of Michael Grant’s excellent account of The Fall of the Roman Empire identify the core dynamics of decline:

  • The Gulfs Between the Classes
  • The Credibility Gap
  • The Partnerships That Failed
  • The Groups That Opted Out
  • The Undermining of Effort

Our focus today is on The Groups That Opted Out. In the decline phase of the Western Roman Empire, people dropped out by abandoning tax-serfdom for life in a Christian monastery (or as a worker on monastery lands) or by removing themselves to the countryside.

Today, people drop out in various ways: early retirement, disability or other social welfare, homesteading or making and saving enough money in the phantom-wealth economy that they can quit official work in middle age.

We can see this in the labor participation rates for the populace at large, women and men. The labor participation rate reflects the percentage of the population that’s in the workforce, either working or actively looking for work.

That the number of people in the workforce has declined significantly is well-known. The US Census pegs the number of people ‘not in the labor force’ at 95 million.This includes people who are disabled, in school, etc., so the number should be taken with a grain of salt. But the decline in the relative size of the labor force is remarkable:

Interestingly, the labor participation rate for women has held steady compared to the entire populace.

Now compare it to the labor participation rate for men, which has absolutely cratered:

The difference between genders is striking. Gender roles in society and the economy are clearly causal factors. Many have speculated that the decline in traditional strongholds of male employment such as manufacturing explain the decline of males in the workforce. As for the high participation of women, we might speculate that being caregivers for children and elderly parents requires earning an income, and as these responsibilities continue to fall more heavily on females, it may be that fewer women have the option of dropping out.

As for turning off, consider this account of tech overlords turning off their own childrens’ access to screens (via GFB): A Dark Consensus About Screens and Kids Begins to Emerge in Silicon Valley “I am convinced the devil lives in our phones.”

I’ve written about mobile phone and social media addiction many times, so the reluctance of tech elites to let their own children suffer the ravages of digital addiction isn’t surprising.

As for tuning out, the strident voices of political polarization are not as widespread as generally perceived: Hidden Tribes: A Study of America’s Polarized Landscape found that the rabidly leftist / “progressive” tribe is a mere 8%, and their opposite tribe on the right is equivalently modest in number.

It doesn’t take much observation to surmise that the majority in the middle are tuning out both polarizing extremes. Partisans may view this abandonment as negative, i.e. apathy, but this would be misreading the situation: the reality is the majority are tired of the poisonous polarities and the stultifying, going-nowhere toxic frenzy that destroys participants’ equilibrium and sanity.

An unknown but likely staggeringly large percentage of small business owners in the U.S. are an inch away from calling it quits and closing shop. At some point the ever-higher costs of burdensome, mostly useless bureaucratic compliance and complexity, the ever more costly junk fees, filing fees, permits, penalties and taxes, the higher costs of labor overhead (healthcare insurance, workers comp, etc.) and the ever-rising costs of materials and services make it an easy decision to drop out of the rat race and either sell the business to someone less grounded in reality or just close it down.

Those who tire of being nailed by “tax the rich” schemes can drop out by earning less. Sell out, move out, drop out. Unfortunately for all those who depend on the Savior State, the state cannot force people losing money and their mental health to continue operating enterprises. (At least not yet.) Once small business and the productive wealthy (i.e. upper middle class) sell out, move out and drop out, it’s game over for the “tax the rich” crowd and the local economy.

Dropping out is an increasingly attractive option. For those unable to drop out,turning off and tuning out are increasingly attractive options.

It's All About Jews

Treasury Sanctions Foreigners for Israel

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Will Israel-lobby-captured OTFI sanction Americans?

by Grant Smith Posted on August 30, 2018

The American Israel Public Affairs Committee (AIPAC) was ordered to register as an Israeli foreign agent on November 21, 1962 when it was part of the American Zionist Council. AIPAC has never complied with the order, and the Department of Justice has never enforced it. AIPAC’s associated think tank, the Washington Institute for Near East Policy (WINEP) was spun off from AIPAC as a survival tactic during a 1980s FBI investigation into AIPAC over economic espionage that produced America’s worst-performing bilateral trade agreement. Incredibly, decades later both organizations appeared to want to get into law enforcement and were instrumental lobbying President George W. Bush for the 2004 launch of the Office of Terrorism and Financial Intelligence (OTFI) Treasury unit. (See Washington Institute for Near East Affairs congressional testimony in support of the creation of OTFI to be headed by Stuart Levey)

Although OTFI proclaims it is “safeguarding the financial system against illicit use and combating rogue nations, terrorist facilitators, weapons of mass destruction (WMD) proliferators, money launderers, drug kingpins, and other national security threats,” the secretive office has a special blind spot for major terrorism generators, such as tax-exempt money laundering from the United States into illegal Israeli settlements and proliferation financing and weapons technology smuggling into Israel’s clandestine nuclear weapons complex.

As AIPAC and WINEP demanded in 2003, the office as initially led by Undersecretary of Treasury Stuart Levey, who worked in unusually close coordination with the Israeli government. Levey’s Harvard thesis (PDF) was about how Israel lobbying organizations could become more effective by staying beneath the radar of public scrutiny and distancing themselves from the notoriety generated by the illicit activities of such ideological fellow travelers as the Jewish Defense League. JDL was a Department of Justice-designated terrorist organization involved in bombings and more recently had a supporter indicted for 2017 violence against a peaceful protester of AIPAC’s policy conference.

In its early years OTFI rebuffed Freedom of Information Act (FOIA) attempts to obtain information about OTFI operations and the purpose of Levey’s numerous taxpayer-funded trips to Israel by citing the Bank Secrecy Act. OTFI is even more impenetrable to outside scrutiny than most Treasury offices, most particularly OTFI’s personnel records. Levey made OTFI briefers available mostly for private presentations and off-the-record Q&A sessions to a limited number of organizations well-known for having the advancement of Israel as a top organizational goal, such as WINEP and the Foundation for the Defense of Democracies.

When Levey finally stepped down in 2011, the top job at TFI was transferred to David Cohen, who worked at the same Washington DC law firm as Levey, Miller, Cassidy, Larroca & Lewin LLP (which later merged into Baker Botts LLP). Cohen continued Levey’s practice of curtailing OTFI’s availability to any concerned public opposition. On September 12, 2012, Cohen refused to answer reporter questions about Israel’s possession of nuclear weapons, and whether sanctioning Iran, a signatory to the Treaty on the Non-Proliferation of Nuclear Weapons, over its internationally-inspected civilian nuclear program was an example of endemic double standards at OTFI. In 2015, Mondoweissobserved that the key requirement for Americans working in the top “counterterrorism” job at OTFI appeared to be being both Jewish and Zionist. Most Americans (70%) do not self-identify as Zionist. (Defined in the poll as any person who believes in the development and protection of a Jewish nation in what is now Israel.)

Cohen was succeeded by longtime OTFI employee Adam Szubin, former counsel to Stuart Levey, who was appointed to lead OTFI during the Obama administration, but never confirmed by the Senate. Szubin also visited Israel frequently on the taxpayer dime and, like Levey and Cohen before him, kept WINEP and AIPAC lobbyists well-briefed on OTFI initiatives. Szubin served as interim under secretary from January 20, 2017 until February 13, 2017. In 2017 the already narrow hiring criteria of OTFI was even further restricted. According to the news and intelligence website DEBKAfile, OTFI’s current leader Sigal Pearl Mandelker, also a dedicated Zionist, either had or still has Israeli citizenship.(PDF) Mandelker was confirmed by the Senate on June 21, 2017.

Within its own organization, Department of Justice policy has no issue with dual-nationals seeking and being granted sensitive jobs. (PDF) However, there are obvious potential conflicts of interests with an Israeli-American dual national, dedicated to the advancement of Israel, running OTFI. The progression reveals that the leadership of OTFI is being hand-picked by the Israel lobby on the basis of predicted devotion to advancing the strategic position Israel. This raises the question of how such influence negatively impacts Americans, as AIPAC and the Israel advocacy ecosystem prepare to expand the OTFI model across states and within the federal bureaucracy.

AIPAC is attempting to pass new laws and enforcement powers to target Americans found “guilty” of boycotting Israel over its endemic human rights abuses. Drafts of the “Israel Anti-Boycott Act” appear to allow secretive units such as OTFI or new units housed within the Export Import Bank to fine Americans up to $1 million and imprison them for up to 20 years for such boycott activities. Free speech rights arguments have not been much of an obstacle to such secretive extra-judicial operations. OTFI worked to successfully to imprison New Yorker Javed Iqbal for nearly six years over airing Hezbollah videos on his privately-owned cable network that Israel affinity organizations found distasteful. OTFI shut down nonprofit charities the Israel lobby opposed such as Al-Haramain, Benevolence International, Global Relief, and Kind Hearts with little due process. Because the Israel lobby’s “Israel Anti-Boycott Act” could go even further, it is particularly relevant to scrutinize OTFI as the model for taking sanctions applied mostly to disenfranchised foreigners, and turning them against American citizens residing and doing business in the U.S.

OTFI has extraordinary powers to sanction entities and individuals and enact secondary actions against entities that do business with them under broad executive orders. An examination of OTFI’s Specially Designated Nationals And Blocked Persons List (SDN) Human Readable Lists provides further evidence of Israel lobby regulatory capture. As part of its enforcement efforts, OFAC publishes the SDN list of individuals and companies it accuses of being owned or controlled by, or acting for or on behalf of, targeted countries. It also lists individuals, groups, and entities it claims are terrorists and narcotics traffickers designated under indicators that are not country-specific. Collectively, such individuals and companies are called “Specially Designated Nationals” or “SDNs.” Their assets are blocked, and banks and US persons are generally prohibited from dealing with them. Lawyers specializing in this area attest to the difficulty of removing those listed on the Treasury’s SDN list. The tipoff that the list is Israeli-approved, is the absence of well-known nuclear weapons technology traffickers for the only country in the region that actually has a clandestine nuclear weapons program – Israel.

TFI/OFAC operatives code each SDN individual or entity suspected of trafficking in nuclear weapons technology with the designator code “NPWMD” meaning “Weapons of Mass Destruction Proliferators Sanctions Regulations” which cites 31 C.F.R part 544 authorities for the application of sanctions. However, Israeli film producer Arnon Milchan, who transacts millions of dollars through the US and international financial system, and his accomplice, Israeli Prime Minister Benjamin Netanyahu, are both known to the FBI and DHS as having facilitated the unlawful smuggling of hundreds of nuclear weapons triggers from the United States through a global network of front companies. Though never convicted, nothing prevents their listing on the SDN. However, neither individual nor their related business organizations or front companies used in the operation appear as sanctioned entities under the SDN.

In 2012, Belgian company Telogy International NV committed 23 violations of the Export Administration Act of 1979 (PDF) by smuggling 22 Tektronix oscilloscopes worth hundreds of thousands of dollars. Oscilloscopes are critical nuclear weapons testing and production technology and export-prohibited without proper end-user licenses. OTFI’s agents never entered either Telogy or the company that acquired it, Electro Rent Corp, into the SDN database to ward off banks and others from doing business with it – because Telogy smuggled the oscilloscopes to Israel.

It appears that OTFI leadership has ordered SDN list compilers not to include any Israeli nuclear weapons traffickers on the list. In the current SDN there are multiple entries for countries not believed to have nuclear weapons programs, such as Iran and Syria. There is not a single SDN NPWMD entry for any Israeli individual or entity, despite the CIA’s having confirmed the existence of an Israeli nuclear weapons program in 1974, and that the program was fueled by material stolen from the United States in the 1960s. CIA considered Israel a proliferation threat to countries such as Taiwan (which appears a few times in the SDN) and South Africa. Indeed, there are only a handful of SDN entries for Israel at all, which mostly appear to be Russian oligarchs with Israeli passports.

AIPACs Israel Anti-Boycott Act legislation requires “enforcement actions” under some of the same authorities used by OTFI, the International Emergency Economic Powers Act, 50 U.S.C. § 1701-1706, in declaring as a “US national emergency” grassroots-led boycotts of products made in illegal Israeli West Bank settlements and other Israeli products and services. These boycotts are not really US emergencies in any sense, but rather target a grassroots strategy to protest of Israel’s dismal human rights record. AIPAC considers the OTFI model of unaccountable, anonymous judges, jurors and financial executioners as an appropriate model to apply to Americans and foreigners who engage in entirely peaceful, lawful, First Amendment protected boycotts. AIPAC has lobbied for passage of the Israel Anti-Boycott Act for years even though statistically significant polling reveals that 69.1% of Americans oppose it.

One of the most cherished rights in America is the Confrontation Clause of the Sixth Amendment to the US Constitution which provides, “in all criminal prosecutions, the accused shall enjoy the right…to be confronted with the witnesses against him.” However, the right only applies to criminal prosecutions, and not civil cases or other proceedings. But it is a commonplace American expectation that citizens will not be punished for accusations of wrongdoing by anonymous accusers. OTFI and SDN operate beyond such expectations.

Having already served as de facto criminal prosecutors, judges and juries, and financial access executioners of foreigners, OTFI agents may upon passage of the Israel Anti-Boycott Act turn their extrajudicial powers on fellow Americans. Until now, OTFI staff has never borne any burden of confrontation by the accused. And even Americans who disagree with OTFI’s selective interpretations of laws, based on executive orders and other authorities used to place foreigners on the SDN list, are unable to meaningfully interact with the OTFI personnel making such punitive policy decisions – unless they are an attendee of a special briefing conducted by Adam Szubin and also already fully paid-up donors or members of AIPAC or WINEP. Though courts have held that the US Constitution applies to non-citizens, if a foreigner has been unjustly placed on the SDN with no due process, he or she is presently unable to make a phone call from overseas to a known OTFI agent and informally present their case. OTFI is now clearly worth a much closer examination, because if AIPAC has its way either OTFI or an operation very much like OTFI, with anonymous extra-judicial Treasury powers, handpicked by the Israel lobby, may soon sanction American companies and individuals it secretly finds “guilty” of boycotts.

Excerpt from a 61-page legal memorandum, with 1,230 pages of exhibits filed in DC District Court on August 24, seeking full release of OTFI personnel records alongside those of other Treasury units.

Grant F. Smith is research director of the Institute for Research: Middle Eastern Policy and the plaintiff in civil action no. 17-CV-1796 seeking data to reveal “whether the depth of the Israel lobby’s capture of OTFI reaches all the way down to front-line employees.” He is the author of the 2016 book, Big Israel: How Israel’s Lobby Moves America now available as an audiobook.

Western Hegemony's Collapse

For Russia, Change Comes SWIFTly

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Authored by Tom Luongo,

During the ruble crisis of 2014/15 Russia announced in the wake of U.S. and European sanctions over reunifying with Crimea that it would begin building a domestic electronic financial transfer system, an alternative to SWIFT.

That system, System for Transfer of Financial Messages (SPFS), is not only now functioning in Russia, according to a report from RT it now handles the financial transfer data for more than half of Russia’s institutions.

According to Anatoly Aksakov, head of the Russian parliamentary committee on financial markets:

The number of users of our internal financial messages’ transfer system is now greater than that of those using SWIFT. We’re already holding talks with China, Iran and Turkey, along with several other countries, on linking our system with their systems,” Aksakov said.

“They need to be properly integrated with each other in order to avoid any problems with using the countries’ internal financial messaging systems.”

This is a follow up to last month’s boast by the Russians that their system was seeing a lot of international interest. How much of this is boast and how much of it is reality remains to be seen, but the important point here is that the minute the U.S. weaponized SWIFT for use in its foreign policy, something like this was bound to occur.

China has its own internal system. And other countries are building theirs as well.

The SWIFT Cost

A common theme on this blog is that control is an illusion. Power is ephemeral. The best way to exercise your power is to have it but never use it. Because once you do use it you define for your enemies the costs of their lack of compliance to your edicts.

And if there is one thing humans are good at it is responding to known incentives. Once we can calculate the cost of one behavior over another we can then decide which one is more important to us.

Once costs of staying in SWIFT rise above the benefits of building your own alternative, you build an alternative.

SWIFT is a market power similar to a CEO having billions in restricted stock in their company. A lot of hay is made about the net worth of people like Jeff Bezos and Mark Zuckerberg.

Quoting their net worth by multiplying their known holdings times the current price of the stock is useless. Because they can’t sell it. It is market power or perceived wealth that evaporates the moment they signal to the market their intention to sell.

In reality, if they tried to sell their stock all at once the value of the stock would plummet as buyers would run for the hills and they would realize far less than their stated net worth before the selling began.

So, if anything they are a captive of their own success, needing to manage the creation carefully to avoid damaging its reputation, market position and, ultimately, its business.

SWIFT is a monopoly system, a monopoly born of convenience and inertia thanks to it being neutral to whims of international political spats. Enter the late stage of imperial thinking in the U.S. where our control over world affairs is waning first in the hearts and minds of various people around the world and then in policy and you have the beginning of the end of SWIFT as the only international financial transfer system.

Back in 2010, I remember Jim Sinclair banging his shoe on the table about our threatening Switzerland over opening up its customer data looking for ‘tax cheats’ under FATCA. He said then that the Obama administration was idiotic for doing this.

This is where I got the maxim, once you go nuclear you have no other option.

And he was right.

Then Iran was cut out of SWIFT in 2012 to effect regime change which also failed. And that woke the world up to the reality. The U.S. and Europe will attempt to destroy your livelihood if you dare oppose its unilateral demands.

Our political and financial elites, The Davos Crowd, will stop at literally nothing to ensure your compliance.

Too bad that SWIFT is just code. It’s just an encrypted messaging system. And like the push to stifle alternative voices on social media – de-platforming Alex Jones and Gab for examples – the solution to authoritarian control is not fighting fire with fire, but technology.

And that’s exactly what Russia has done. They applied themselves, spent the money and wrote their own code. Code is, after all, hard to control.

De-coding SWIFT’s Power

It is also what is happening all over the Internet communications supply chain right now. The infrastructure independent content producers need to resist corporate control is being built and will see their businesses rise as so many more people are now woketo the reality of the situation.

As Russian banks and businesses reap the benefits of no longer existing under SWIFT’s Sword of Damocles, others will see the same benefits.

I’ve been making this point all year, the more the Trump administration uses tariffs and sanctions to achieve its political goals the more it will ultimately weaken the U.S.’s position worldwide. It won’t happen overnight.

It will build, gradually, steadily until one day the threat will no longer be there.

We may have already reached that moment as President Trump has ruled out pressuring SWIFT to cut Iran out of the system. Too bad his evil Treasury Secretary Steve Mnuchin doesn’t agree with him.

But, Mnuchin is living in the past, he doesn’t respect the resistance that’s forming to U.S. financial hegemony. He will though when it proves ineffectual.

Russia’s SPFS will gain clients across Iran, Turkey, China and the rest of its close trading partners. This will accelerate the de-dollarization of Russia’s main trade, hydrocarbons, since many of these countries are major buyers of Russian oil.

When you hear the announcement from a German bank under sanctions from the U.S. for trading in Russian energy that it will use SPFS as its transfer system, that will be the real wake up call to the markets.

Change then will come, forgive the obvious pun, swiftly.

Military Affairs

New American Weapon Rendered “Useless” Against Russian Missiles

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By Paul Antonopoulos

The US successfully conducted the first test of its ballistic missile interceptor recently . But despite this, in the field of anti-missile defense, the country is a decade behind Russia’s Strategic Nuclear Forces, said Russian media Politika Segodnya.

At the end of last month, the US Defense Department’s Missile Defense Agency reported that the US Army successfully tested its Aegis missile defense system and intercepted a medium-range ballistic missile.

The Pentagon considered this test a key moment in the development of the US anti-missile defense program.

In his article for the Russian edition, journalist Yuri Podoyaka compared this latest US advance with Russia’s technological development in this sector.

“Undoubtedly, this is a much-anticipated advance of the American technical concept, but Russia is currently withdrawing from such military service and moving on to a new generation of warheads, against which the new US missile is totally incapable to fight,” he commented.

In addition, the journalist assures that it is not worth waiting for the emergence of a true interceptor of naval missiles in the USA.

“The entire concept of Aegis’ integrated missile defense system is incapable of combating the new Russian missiles and from the outset this system was a dead end,” he said.

Today, the new projectile can reach an altitude of up to 500 km and destroy targets at a distance of several hundred kilometers, admits the author of the article.

“It is a true masterpiece of technology, but absolutely useless to fight against the intercontinental ballistic missiles of its likely adversary, Russia.”

According to the journalist, the US military is not even trying to reach that goal because they understand that today it is beyond the capabilities of its new weapon. To achieve targets flying at speeds of 6-7 kilometers per second, you need to have a much higher precision system or much greater possibilities to correct the missile’s warhead trajectory.

The only possibility of destroying the new Russian missiles seems to be to intercept them in the early stages of the trajectory, said the journalist, especially if the Arleigh Burke Flight III destroyers try to intercept missiles launched from Russian submarines.

However, Russia is developing the means to deprive the US of this possibility as well, by positioning the S-400 Triumph anti-aircraft missile systems, and in the future, the S-500 Prometei aboard its Borei-class submarines.

Its main goal is to protect Russian territory from US nuclear warheads, writes the columnist.

“During the 20 years of its existence, the US Aegis anti-missile program continues to be a very expensive entertainment and a very convenient way for admirals and corporations to obtain income,” he said.