Congo forces leaders to pay taxes – ours?

The Democratic Republic of Congo, faced with a fiscal crisis, is now forcing their leaders to pay taxes. Reuters reports

Amid a growing budget shortfall, the government is under pressure to cut costs and boost tax revenues.

Budget Minister Michel Lokola told Reuters that last month’s decision to tax government salaries at source, rather than rely on employees to pay taxes after receiving their salaries, had already raised roughly $1 million.

“They just weren’t paying. The government ministers we replaced, the MPs, the senators, they didn’t pay,” said Lokola, who entered the government last October in a cabinet shake-up that saw his predecessor Adolphe Muzito named prime minister.

Lokola said the move was partly aimed at setting a good example, adding that Congolese President Joseph Kabila’s government salary was also subject to the measure.

“He is aware of this, and he approves of it … I don’t see how we can expect the private sector to pay their taxes if we don’t pay ourselves,” he said.

So even a country we look upon with derision, the Congo, has realized the benefit of taxing the elite of their country. As we have seen, politicians in this country appear to have an aversion to paying their taxes, and can’t even comprehend the tax code that they wrote, as evidenced by Tom Daschle, who didn’t know the limo was taxable.

So will Geithner, considering the fiscal crisis we, ourselves, are facing, implement a program of ferreting out government tax cheats and garnishing their taxpayer-paid wages?

I doubt it.

He’s a tax cheat.

Nothing like the fox guarding the hen house.

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Sign letter to Obama regarding Palestine

Jewish Voices for Peace and Just Foreign Policy teamed up to get signatures urging President Obama to end the blockade, talk to everyone and jump on this chance to actually have peace in that area of the world.

It’s the Oil and Gas Stupid

Widely covered in Asia and the Near-East, but not in he United States, was the inauguration of the Ceyhan-Tbilisi-Baku (BTC) oil pipeline, which links the Caspian Sea to the Eastern Mediterranean. This pipeline totally bypasses the territory of the Russian Federation by transiting through the western friendly, former Soviet republics of Azerbaijan and Georgia.

But the more sinister implications of this pipeline, are seen when the four partners are revealed and the ultimate destination of the pipeline is reviewed.

The partners are Azerbaijan, Georgia, Turkey and Israel. The destination the Israeli port of Ashkelon, which bypasses Lebanon and Syria utilizing underwater pipelines. However, the ultimate goal is to have back up land based pipelines, which would require Israel, responsible for the security of the pipelines, to have territorial control over the East Mediterranean coastline.

The day after the deal was signed, the Lebanon bombing began.  Step one?

Well it failed miserably.

Back up now to the November 1999, when British G Group (BG) and Lebanon’s Consolidated Contractors International Company (CCC), were granted oil and gas exploration rights in a 25 year agreement signed with the Palestinian Authority, then run by Yassir Arafat.

According to Michael Chossodovsky, researcher for Global Research Canada,

The rights to the offshore gas field are respectively British Gas (60 percent); Consolidated Contractors (CCC) (30 percent); and the Investment Fund of the Palestinian Authority (10 percent). (Haaretz, October 21, 2007).

The PA-BG-CCC agreement includes field development and the construction of a gas pipeline.(Middle East Economic Digest, Jan 5, 2001).
The BG licence covers the entire Gazan offshore marine area, which is contiguous to several Israeli offshore gas facilities. (See Map below). It should be noted that 60 percent of the gas reserves along the Gaza-Israel coastline belong to Palestine.

The problem though, lies in the sovereignty of the gas. Reserves, estimated by British Gas to be of the order of 1.4 trillion cubic feet, are valued at approximately 4 billion dollars. The size of Palestine’s gas reserves could be much larger, according to Chossodovsky.

Unfortunately for Gaza, under Article XI, of the 1994 Gaza-Jericho Agreement,  three Maritime Activity Zones that extended out to sea 20 nautical miles from the coast of Gaza, were established. Two narrow Zones running parallel to the boundaries of Egyptian and Israeli waters were designated No Fishing Areas. Under the terms of the Agreement the larger remaining Zone “will be open for fishing, recreation and economic activities.” The Gazan fishermen operated freely for the next 6 years within this Zone with no major confrontations with the Israelis.

Until gas was discovered 10 to 15 nautical miles from the coast, within those boundaries. In 2002, the UN’s  Bertini proposed the approved location be reduced to an area within 12 nautical miles of the coast. More recently the area available has been reduced to 300 square kilometers.

According to Global Research Canada,

Consequently,since the death of Arafat, the election of the Hamas government and the ruin of the Palestinian Authority, Israel has established de facto control over the gas fields.

With this control, they began negotiating with BG for the gas. They were reportedly close to a deal when Hamas won the elections in 2006. When the newly elected Palestinian government collapsed, and Hamas had control of the Gaza Strip, Prime Minister Haniyeh  promptly declared that the natural gas deal would have to be renegotiated.

The Times of India reports that  this prompted the Gaza blockade which resulted in the humanitarian disaster that is Gaza today.

In 2001,

Beginning in late 2000 the Israeli military began a campaign of intimidation and harassment against the fishing boats that ventured near or beyond a 6 nautical mile limit. No formal notice or explanation was ever given to the Palestinians. Instead the regulation was written and enforced by Israeli machine guns and water cannons. At least 14 fishermen have been killed by the Israelis, over 200 injured and numerous boats damaged or impounded.

Initially, BG had negotiated with Egypt to buld an undersea pipeline to import the gas, but under pressure from Tony Blair, were forced to negotiate with Israel instead.

After years of wrangling over prices and getting nowhere, BG closed their Israeli office and again negotiated with the Egyptians.

But the true intent of the Israelis comes to light when viewing the quotes from Israeli and officials.

AfterAriel Sharon was elected Prime minister in 2001, he said he would never buy gas from the Palestinians.

In June of 2008, Israel began preparing for Operation Cast Lead, its latest incursion into Gaza. In the same month, BG was contacted by Olmert with a request to reopen negotiations. They began anew in October 2008, shortly before the commencement of the Gaza invasion.

This does not bode well for Gaza, the Palestinian Authority, who were bypassed in the latest negotiations, or the peace process in general.

Egypt would do well to be very careful in what it does, lest its actions blow back on them from the Arab street.The Moslem Brotherhood is very much sympathetic to the Palestinian cause.

With Israel’s nuclear capability, their alliance with the Turks, and new found wealth from oil and gas revenues, the west should be very careful in how it sees the balance of power in hte Middle East that would result from this venture.

We should all hope that the Europeans in particular, don’t forget the strength of the Ottoman Empire, the dismantlement of which, after WWI, resulted in the establishment of Iraq, Iran, countries of the Middle East, and the ensuing rise of dictators and radicals alike in subsequent years. Would they like to see a similar rise in power again?

I don’t think so.

It’s past time that this issue of Palestine get settled and we find alternative fuels,  not only for the sake of the innocent civilians caught up in the various conflicts, but for the sake of the rest of the citizens of the world whose children will be the cannon fodder for the inevitable wars to follow and whose money will be squandered funding them.

Sources:

Global Research timeline Lebanon War

Times of India

War and  Natural Gas

Oil and Lebanon

Clinton disappoints but doesn’t surprise

Hillary Clinton attended the donor’s conference for Gaza, today, and announced the United States has pledged $900 million dollars, but warned none would go to Hamas, and only one third is earmarked for Gaza reconstruction. No word about where the other two thirds will be spent. In all, donors pledged $3 billion in aid.

Reuters reports that Kamal Hassouni, a minister in the Palestinian Authority, broke down the aid package as follows:

$348 million of the foreign aid would be used for housing, $119 million for transport services, $266 million for farming and $146 million for industry. About $1.45 billion will support the Palestinian Authority 2009 budget and the rest will fund other government expenses.

The Palestinian Authority plans to judge each Gazan house, individually, and make payments for damage directly to the homeowner.

That’s a great thought, except how is the homeowner supposed to rebuild their home? With the Karni Crossing closed, no construction supplies can reach Gaza, and it wouldn’t matter anyway because the Israelis won’t allow steel beams or cement into Gaza.

Would adobe work there?

Here’s where Clinton has a say, but says nothing meaningful, demonstrating her total lack of understanding of the situation on the ground in Gaza and at the borders. She reiterated that we won’t deal with terrorists, won’t deal with Hamas, but will deal with Abbas who she says “offered a more peaceful future.”

Which is where her lack of understanding completely comes into play.

Abbas, is a member of the Fatah Party, and was Yassir Arafat’s protegee. The Al-Aqsa Martyrs Brigade, according to the Council on Foreign Relations, is

a network of West Bank militias affiliated with former Palestinian leader Yasir Arafat’s Fatah faction and has been one of the driving forces behind the what Palestinians call the “Second” or “Al-Aqsa Intifada” (uprising). While the group initially vowed to target only Israeli soldiers and settlers in the West Bank and Gaza Strip, in early 2002 it joined Hamas and Palestinian Islamic Jihad in a spree of terrorist attacks against civilians in Israeli cities. In March 2002, after a deadly al-Aqsa Martyrs Brigade suicide bombing in Jerusalem, the State Department added the group to the U.S. list of foreign terrorist organizations, and ceased regarding Arafat as a viable partner in peace negotiations….

In 2004 the brigade engaged in a ceasefire with Israel but resumed attacks when Hamas won Palestinian elections in 2006, according to the State Department. The 2006 Country Report says that the brigade continues intra-Palestinian violence and adds to the “overall chaotic security environment.” The brigade operates primarily in the West Bank but have also carried out attacks in the Gaza strip and Israel.

Note their affiliation is with Fatah. Hamas, in the run up to the elections, had honored a ceasefire with Israel and contiued to honor it, for 18 months. The Fatah group started the rocket fire, while Hamas was still honoring the ceasefire. I’m not sure how this bodes to be a “more peaceful future.”

The State Department asked ordinary Americans what to do about Gaza. The vast majority said Hamas can’t be ignored, they are a stakeholder. The vast majority said to stop funding Israel and stop providing military aid unless they stop indiscriminately killing Palestinian civilians. The vast majority of those who responded, want us to be honest brokers of the peace and stop choosing sides within Palestine, and stop backing Israel unconditionally.

Perhaps Madame Secretary didn’t get a chance to read our recommendations, or perhaps she didn’t care what they were. I hope it’s the former.

I just know that since the Al-Aqsa Martyr’s Brigade is a Fatah organization, and since Mahmoud Abbas was a member of the PLO, whose charter also doesn’t recognize Israel, and since there are many Arab nations that we deal with who refuse to recognize Israel, this whole idea of cutting out Hamas because they don’t recognize Israel is a straw dog argument.

Israel doesn’t recognize Palestine’s right to exist either.

The notion that Abbas is the best hope for peace, is laughable considering his group, based in the West Bank, has been responsible for the following actions, again according to the Council on Foreign Relations:

* In January 2008 the al-Aqsa Martyrs Brigade joined with Hamas and the Palestinian Islamic Jihad to shoot rockets into Israel from Gaza. Israel retaliated by blockading the Gaza strip;
* A January 2007 suicide bombing in Eilat that killed three people. The attack was the first suicide bombing in Israel in nine months and both al-Aqsa Martyrs Brigade and Palestinian Islamic Jihad claimed responsibility for it;
* In June 2006 members of the brigade kidnapped an American college student after mistaking him for an Israeli. Initially they said he would be killed unless Israel released all of its Palestinian prisoners but released him the same day upon discovering his nationality;
* In January 2006, the European Union mission in Gaza was overtaken for a half hour by masked gunmen who demanded that Denmark and Norway apologize for publishing satirical cartoons of the Prophet Mohammed. There were no shots fired or injuries;
* An October 2005 suicide attack at the Gush Etzion junction that killed three Israelis and wounded three others;
* A March 2004 suicide bombing at a checkpoint at the Port of Ashdod that killed ten people. Hamas also claimed responsibility for the attack;
* A January 2004 attack on a bus in Rehavia, Jerusalem that killed 11 people;
* A pair of January 2003 suicide bombings in downtown Tel Aviv that killed 23 people and injured about 100 more, one of the bloodiest attacks of the current Palestinian uprising;
* A November 2002 shooting spree at a kibbutz in northern Israel that killed five Israelis, including two children, and wounded seven more;
* An April 2002 suicide bombing at a marketplace in Jerusalem that killed six people and injured 104 more;
* A March 2002 suicide bombing in Jerusalem that killed three Israelis, prompting Israel to call off ceasefire talks with Arafat’s Palestinian Authority;
* Another March 2002 suicide bombing in a Jerusalem café that killed 11 Israelis and wounded more than 50;
* A March 2002 sniper attack on an Israeli army checkpoint in the West Bank in which the gunman methodically killed 10 Israelis, including seven Israeli soldiers, before escaping;
* A January 2002 suicide attack in Jerusalem by a female terrorist that killed an elderly man and wounded about 40 other people.

If they’re stocking their peace prospects with this crowd, good luck. Even the right wing Israelis don’t trust Abbas. I don’t know why we do. Looks like half the donor money for Gaza is going straight into the pockets of Fatah and its supporters.

And people wonder why the Palestinians elected Hamas….

Secretary of State Clinton asks: What is the best Path Forward for Gaza?

Dipnote, the U.S. State Department blog, has a new question, what should we do about Gaza?

On March 2, Clinton will participate in the donor conference for Gaza reconstruction. Until then, she will be taking suggestions from ordinary Americans.

Here is the link. Lend your voice in our participatory democracy, or shut your piehole and live with their decisions. 🙂

Clinton, Rubin and Summers, Graham, Leach and Bliley – thank you

In the early 1900’s, commercial banks began to establish security affiliates that floated bond issues and underwrote corporate stock issues. (In underwriting, a bank guarantees to furnish a definite sum of money by a definite date to a business or government entity in return for an issue of bonds or stock.)

Then the stock market crashed.

In 1930 the Bank of the United States failed, reportedly because of activities of its security affiliates that created artificial conditions in the market, FDR closed the banks for four days, 4000 failed permanently, and Congress created the Glass-Steagall Act of 1932, then amended it in the Banking Act of 1933.

The act forced a separation of commercial and investment banks by preventing commercial banks from underwriting securities, with the exception of U.S. Treasury and federal agency securities, and municipal and state general obligation securities.

More specifically, the act authorizes Federal Reserve banks to use government obligations and commercial paper as collateral for their note issues, in order to encourage expansion of the currency. Banks can also offer advisory services regarding investments for their customers, as well as buy and sell securities for their customers. However, information gained from providing such services cannot be used by a bank when it acts as a lender.

Likewise, investment banks cannot engage in the business of receiving deposits.

A bank is defined as an institution organized under the laws of the United States, any state of the United States, the District of Columbia, any territory of the United States, Puerto Rico, Guam, American Samoa, or the Virgin Islands, that both accepts demand deposits (deposits that the depositor may withdraw by check or similar means for payment to third parties or others) and is engaged in the business of making commercial loans (12 U.S.C.A. § 1841 (c)(1) [1988]).

Investment banking consists mostly of securities underwriting and related activities; making a market in securities; and setting up corporate mergers, acquisitions, and restructuring. Investment banking also includes services provided by brokers or dealers in transactions in the secondary market. A secondary market is one where securities are bought and sold subsequent to their original issuance.

It also created the Federal Deposit Insurance Corporation (FDIC) to protect depositors in the future.

The Act was passed because it was largely believed, after hearings in Congress, that commercial banks were being too speculative in the pre-Depression era, not only because they were investing their assets but also because they were buying new issues for resale to the public. Thus, banks became greedy, taking on huge risks in the hope of even bigger rewards. Banking itself became sloppy and objectives became blurred. Unsound loans were issued to companies in which the bank had invested, and clients would be encouraged to invest in those same stocks.

Enter the Clinton Era and the Graham-Leach-Bliley Act of 1999, the act which ultimately repealed the Glass-Steagull Act. The final bi-partisan version passed in the Senate 90-8-1 and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999, though most of his Democratic colleagues voted against it, initially (Senate 54-44, House 343-86).

The Graham-Leach-Bliley Act sought to “modernize” financial services–that is, end regulations that prevented the merger of banks, stock brokerage companies, and insurance companies. It nullified all prior acts that strictly regulated those who stored your money such as the Bank Holding Company Act that prohibited a bank from controlling a non-bank company which passed in 1956 and the 1982 amendment that further forbid banks from conducting general insurance underwriting or agency activities.

Why is this related to today? According to the Online Law Encylopedia,

The expansion of commercial banks into securities underwriting was substantial until the 1929 stock market crash and the subsequent Depression. In 1930 the Bank of the United States failed, reportedly because of activities of its security affiliates that created artificial conditions in the market.

As a result of the bank closings and already devastated economy, public confidence in the U.S. financial structure was low.

Is this sounding at all familiar? It should be.

The Glass-Steagull Act made all of that history, GLBA repealed it and history, my friends, is repeating itself.

*****************************************************************************************************************

Fast forward to October 2011 – With unemployment remaining steadily at over 9 percent for the last several years, foreclosures at an all time high and banks squeezing the dimes out of people with fees for everything but walking in the door, groups around the country are occupying financial districts, parks, banks and anywhere they believe they will have an impact. In New York occupiers shut down the Brooklyn Bridge and in Chicago they have been camped out for a couple of weeks on a corner that conveniently houses the Board of Trade, the Federal Reserve Bank of Chicago and Bank of America down the street. A recent rally joined by four other groups including several labor unions, shut down Monroe Street between Michigan and Columbus — ironically on Columbus Day.

Sources GLBA, Glass-Steagull(1), Glass-Steagull(2)

So why are we asking the experts anything?

NABE, the National Association of Business Economists, today released the results of their annual member survey. Reuters reports they predicted “the recession-hit economy would begin to recover in the second half of this year, returning to a potential growth trend in 2010.”

I wondered who these people were, and if they were the same people that missed this economic problem altogether, and were wondering for a year or two if we “might” be in a recession.

I found another survey summary that led to the current question, the topic of this entry. What do you think? Here’s what NABE says of its members:

Substantial percentages of economists report little familiarity with complex instruments and other financial innovations. Despite the prevalence of NABE members holding advanced degrees in economics and other business-related disciplines, substantial percentages admitted to having little or no familiarity with the structure, activities, and risks associated with hedge funds (45%), private equity funds (40%), asset-backed securitization (48%), credit default swaps (CDS, 68%) and collateralized debt obligations (CDOs, 51%).

That was in August 2007, when they also thought:

The five-year housing outlook remains largely positive. A slight plurality (42%) of respondents expects U.S. home prices to be flat, on average, over the next five years. But respondents who expect home prices to rise on average over the next five years (41%) far outnumber those who expect prices to fall (16%). NABE members continue to place low odds (1 in 10) on a large drop in U.S. home prices similar to that experienced in Japan during the 1990s.

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