The Capitol I Once Knew and Loved

by Stephen P. Pizzo

http://www.stephen.pizzo.com 

Yesterday's insurrection at our Capitol startled and depressed me in several ways. But mostly it sent my mind back a quarter-century or more.

When I awoke this morning I found myself musing about my early days as a reporter...back in the late 80s and thru the 90s ... when I traveled often to DC. It was, of course, way before 9/11, and the Capitol was wide open.

If I had business at the Capitol, I would just bounce up the steps and walk right into the rotunda, no metal detectors, nothing. One day, a friend with a House aide dragged me to the dead center of the rotunda and pointed up to the dome. "Whenever I get discouraged with how things go around here," he said, "I come and stand here and I look up. At that moment I tell myself, 'I am standing on the most powerful spot on the planet.'"

And I felt it. It felt pretty damn good.

Then he took me to an obscure corner of the rotunda and opened an equally obscure door. Behind it, very old and worn white marble steps descended. Before I could step forward he grabbed my arm and said, "Wait, I want you to know something about these steps. Abe Lincoln used these steps whenever he came to the Capitol." I stepped down them as slowly and full of purpose as I have ever walked down any set of steps. And it felt amazing to be so personally in touch with that particular part of our history.

Then I rambled around in the bowels of the Capitol until I came upon the trolly that takes members of congress the short hop from the Capitol to their offices across the street. I was heading there any way to interview a member of the House, so I jumped aboard. There I was, this insignificant little reporter, sitting arm to arm with members of Congress, one among equal travelers.

Again, no one stopped me. No one challenged me. The Capitol...the "People's House" was open to the people. Wide-open. And I felt that ownership.

The same conditions existed over at the Rayburn building where I was headed. I jumped into an elevator where, once again, the high and mighty and the lowly, stood arm to arm, equals, if for only a minute. The doors opened into long shiny white marble hallways that stretched on and on. American and state flags stood outside each member's office door. And all those doors were wide open. I could, and did, walk into any of them I chose and was greeted politely and professionally by a receptionist.

Of course, after 9/11 all that changed in an instant. And now, after yesterday, security will be tightened another dozen notches as American of old goes into the history books and the new security state is further reinforced. With each tightening caused by acts of terror, Americans are pushed farther and farther away from their House, their Senate, their White House, their Supreme Court. And this during a time when what's needed is for Americans to be able to feel what I felt all those years ago...a sense of pride and ownership.

It's all unimaginable ... but in light of what happened yesterday, sadly unavoidable. For example, if the Secret Service is not talking about moving Biden's inauguration indoors, they are making a big mistake. These right-wing nutters know all about sniper rifles, and some own them. Surely some of those who participated in yesterday's riot are veterans of our Middle Eastern wars, so they know all about snipers.

Well, anyway, thanks for letting me stretch out on your couch and get all this off my chest. I may not have liked covering G. W. Bush or the WH antics of Bill Clinton, but I sure did like Washington DC of those times.

It made me feel proud, rather than ashamed and apprehensive.

Riding the Fiscal Tiger

By Stephen P. Pizzo

www.stephen.pizzo.com

As I write this the Senate is arguing over whether to increase cash aid to those hard hit by the pandemic from $600 to $2000. There's no doubt among those of us out here in the real world that even two grand is not going be enough for many. But, as serious as things are right now, this is a small matter when compared to the fiscal mess America faces going forward, as hard decisions collide with even harder facts.

While being a deficit hawk is considered a “Republican thing,” I am a lifelong progressive, and I worry a great deal about two things: 1) ever-expanding deficits, and 2) the Fed responding to every major economic crisis by flooding the markets with virtually free “fiat currency.” (https://www.investopedia.com/terms/f/fiatmoney.asp )

Businesses, banks, and Wall Streeters have become addicted to the Fed's flood of liquidity as if it were heroin. Evidence lays in their response any time the Fed tries to bump up rates or threatens to turn the money faucet off. When that happens, or even the hint it might happen, Wall Street firms panic, and the hue and cries from the corporate bond world is deafening. And for good reason, the Fed is buying a lot of their corporate debt.

“The Fed holds an expansive list of other companies indirectly, including names like Apple and Goldman Sachs, through exchange-traded funds it has purchased. In addition, it has purchased bonds in speculative-grade companies as well as ETFs, including the SPDR Bloomberg Barclays High Yield Bond, a fund in which the Fed holds a $412 billion position.”

https://www.cnbc.com/2020/06/29/the-fed-is-buying-some-of-the-biggest-companies-bonds-raising-questions-over-why.html

Meanwhile, even as the Fed floods markets with liquidity, the vast majority of working Americans haven't seen much of it and instead remains stuck with incomes that have not seen an inflation-adjusted jump in over four decades.

“Sluggish and uneven wage growth has been cited as a key factor behind widening income inequality in the United States. A recent Pew Research Center report, based on an analysis of household income data from the Census Bureau, found that in 2016 Americans in the top tenth of the income distribution earned 8.7 times as much as Americans in the bottom tenth ($109,578 versus $12,523). In 1970, when the analysis period began, the top tenth earned 6.9 times as much as the bottom tenth ($63,512 versus $9,212).”

https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/

So, where is all this funny-money going? Look no further than the stock market. Even in the throws of the worst pandemic in a century, stocks reach new highs almost daily. Should the Fed turn the money machine off, stocks would drop by a terrifying amount...40%...maybe 50%. So it's like riding a tiger...you would love to get off, but dare not.

“The Fed's actions have essentially made mainstream alternatives to stocks impractical for most investors. Those who want to keep cash available can expect little or no interest at all, and with inflation still positive, that means savers are losing purchasing power every month on their cash savings... Low rates are also bolstering the case for other high-risk assets.” ( ie: stocks and corporate debt.)

https://www.fool.com/investing/2020/12/16/the-fed-just-gave-stock-market-green-light-2021/

But flooding the markets with liquidity isn't a solution, but a treatment, a treatment that has its natural limits...not unlike in physics...sooner or later you hit a point of diminishing returns. As we reach that tipping point, no amount of liquidity will bring this sick patient around. At that point, unless something different is done, you get depression...the real kind.

Also at that very moment, the growing federal deficit becomes a very real anchor around the country's neck. No matter how much money the Fed pumps out, it not only no longer boosts but actually starts hurting the economy. Dollars are like stock...the more of them in circulation, the less each is worth. So the dollar plummets in value, requiring more dollars to buy the same amount of anything. It's not hyper-inflation, yet, but either the Fed has to stop pumping funny-money into the system or hyperinflation is the only outcome.

Add to all this the continuing stream of annual federal budget deficits, which for 2020 came in at a breathtaking $3.1 trillion.

At this point the overall federal deficit is becoming a fiscal Chernobyl...a hard-to-control core meltdown, where $27.6 trillion or more obligations accrue hundreds of billions in interest payments to the deficit, meaning that, even if the Fed turned off the printing presses, the deficit would continue to balloon all on its own. https://www.usdebtclock.org

The federal deficit represents the money we owe to both foreign bond investors, (China holds over 5% of US debt,) (https://www.scmp.com/economy/china-economy/article/3112343/us-debt-china-how-big-it-and-why-it-important) and to ourselves (bonds sold to Americans.)

There is a “cheap” way to pay down we owe, but it would require the Fed sparking raging inflation, slashing the value of the dollar. And, since we must repay all those bonds in dollars, it effectively slashes the actual cost of repayment.

Of course, as the old saying warns, “every shortcut has its rent,” and the rent for that short cut would be unacceptably high. Bond investors would be very unhappy, and unlikely to consider US bonds a safe harbor in the future. The Fed could attract them back, but that too would be unacceptably high. The Fed could significantly raise interest rates. But that in turn would strangle any recovery by raising the cost of borrowing for already struggling businesses. It would also significantly raise the cost of government borrowing, which in turn would further increase the deficit.

Once more we learn, the hard way, that there really is no such thing as a free lunch.

With those moves off the table, the only other apparent option would be for the government to significantly slash spending. But at a moment when federal relief spending is the only thing that keeps millions of Americans' heads above water, that option would be cruel in the extreme.

So, as the nation battles a budget-busting, deficit exploding national emergency, what's the answer to this dilemma. There is one solution, unused and vilified by all conservatives and even some centrist Democrats...raise taxes.

You won't hear many in Congress pushing for tax hikes, even among Democrats. Instead, most of the talk is how much more to add to the deficit to pay for worthy stuff now while worrying about the deficit sometime down the road.

But higher taxes on those who can afford them, and who have garnered so much from previous tax cuts, it the only sane answer. Those tax cuts for the rich have also helped feed the federal deficit while enriching the already filthy rich:

“By the end of 2025, the tally of tax cuts will grow to $10.6 trillion. Nearly $2 trillion of this amount will have gone to the richest 1 percent. By then, the total impact on the deficit will be $13.6 trillion, including interest payments.”

https://itep.org/federal-tax-cuts-in-the-bush-obama-and-trump-years/

So the Biden administration needs to quickly and strongly propose revoking most of the tax cuts for the rich passed by Republicans from George W. Bush to Donald Trump. On top of that an emergency review of the US tax code is required to ferret out and close (really close) tax code loopholes.

That would start the process of refilling the federal coffers with enough money to begin paying down the federal deficit. That has only been tried once in my lifetime, and that was during the Bill Clinton administration. Clinton raised taxes on corporations and top earners and, for the first time since Eisenhower was president we had enough surplus to begin paying down the deficit.

Revoking many if not most of the tax cuts passed during the W. Bush and Trump terms really are the only sustainable solution. Will the Biden administration, and Democrats have the guts to grab this “third-rail” and take the necessary heat to get this done … for the good of the nation and future generations? We'll see.

If they don't, and instead keep “kicking the can down the road,” we'll be coming to a sorry dead-end.

Once Again I Solve Everthing

By Stephen P. Pizzo

http://www.stephen.pizzo.com

Unaffordable Life-Saving Drugs:

How about creating an"eminent domain." doctrine for life-saving drugs?

It's an idea that's time has come, and for many of the very same reasons that eminent domain laws were passed to allow local and state governments to force the sale of a piece of property needed for important public purposes.

Over the past decade life-saving drugs have been priced out of the reach of many who desperately need them. The more life-threatening the disease, the higher the drug is priced – a sick twist on the old gag, “Your money or life?”

I could launch into a Sanders-like diatribe about the excesses of free markets and capitalism but, in this case, there's a simple solution, one that can satisfy all sides.

First let's understand an important, and little mentioned, fact about the R&D end of the pharmaceutical business. Drug companies like to complain that they have to spend millions do develop groundbreaking drugs. What they fail to mention is that, even before they get their hands on those formulas, US taxpayers have already dumped tens of millions into their development.

“A new report shows taxpayers often foot the bill to help develop new drugs, but it's private companies that reap the lion's share of profits. In one case, the federal government spent $484 million developing the cancer drug Taxol — derived from the bark of Pacific yew trees — and it was marketed under an agreement with Bristol-Myers Squibb starting in 1993. The medical community called it a promising new drug in the fight against ovarian and breast cancer.

Since then, Bristol-Myers Squibb has sold $9 billion worth of Taxol worldwide, according the the General Accounting Office report released today. The National Institutes of Health have received just $35 million in royalties from Bristol-Myers, however.

The Medicare program alone paid nearly $700 million over a five-year period, to buy a drug the government helped develop.” (Source)

So the government usually has a lot of skin in the game long before drug companies start to test and market a new drug, something they don't like to talk about. Some of that government funding even goes directly to pharmaceutical company-run laboratories.

Okay, so to the solution; pharmaceutical eminent domain:

Any life-saving drug that is put on the market at a price an independent medical panel deems largely beyond the reach of average patients, would be sent to an arbitration board that would set a fair market price for the purchase by the US Government of that drugs patent(s).

Pharmaceutical companies would be paid a fair price, a price high enough for the patent that it would continue to encourage drug companies development of new drugs.

This would create an entirely new calculation for drug companies. Rather than pricing new life-saving drugs a the highest possible price, they would have to calculate what they could earn selling the patent to the US Government against what they could earn over the years if they priced the drug below the level that would trigger an imminent domain action against that particular drug.

Drugs that become the property of the government through this imminent domain process would be administered and marketed by Medicare, priced on a sliding scale of a patient's ability to pay. (We are, after all, talking about life-saving drugs here.)

Without an pharmaceutica eminent domain  option hanging over drug companies, they will always go for the gold when pricing new, life-saving, drugs because, what do they have to lose? Nothing.

What do you have to lose? Your life.

Iraq and Afghanistan

Even though most US troops have been withdrawn from Iraq and Afghanistan, there are still many there and, if some folks in DC have their way, more will follow in the months and years ahead. This is a continuation of what seems to be a shockingly flat learning curve.

There really are not great arguments for remaining militarily engaged in any part of that terminally dysfunctional region. But, when confronted with the many good arguments against such ongoing engagements, proponents of engagement drag out their last weapon: the guilt-trip.

They say that, maybe it was our invasion of Iraq that unleashed this spiral of never-ending violence. And even if it wasn't, the fighting that followed our invasions killed and injured hundreds of thousands of civilians and destroyed what little public and private infrastructure they had. So we can't just pack up and leave now. We need to help them put their Humpty Dumpty back together again.

To which I say, hogwash.

True, citizens of both Iraq and Afghanistan have suffered terribly from the events kicked off by George W. and his sidekick, Dick. But we too have paid a price for it all, and will continue paying it for decades to come. Already the cost of those two wars have been estimated on th low end at at least $2 trillion and, when costs of veteran care and other ongoing costs, it could top $4 trillion – money that could have, and should have, gone to fill very real and growing public and humanitarian needs here at home.

On top of that, over 6,800 US service members and over 6,900 contractors have died in the wars in Iraq and Afghanistan. And an unusually high percentage of young veterans have died since returning home, many as a result of drug overdoses, vehicle crashes, or suicide.

So, as the song goes, “You gotta know when to hold-em, and know when to fold-em.” And it high time to fold-em...both of them, Afghanistan and Iraq. And throw Syria into that mix as well, since there seems to be a growing itch to jump into that Middle East tarpit as well.

As long as the combatants and politicians in those troubled countries think they can sucker the US into sending money, arms and troops to play their sectarian games, they have no incentive whatsoever to seek other solutions. (I shudder to think how many Swiss bank accounts are brimming over with US aide money, but I would wager it would reach well into the hundreds of billions of dollars. Wanna bet?)

So, out now. All the way out. And then stay out. Everyone has paid a terrible price for this “bring democracy to the Middle East” folly. Time to call and end to it and let them figure out exactly what is they want, and are willing to live with.

Israel & Palestine

Here's another bit on never-ending trouble we need to clean our skirts of once and for all. If you're looking for either pure victims or pure heroes, look elsewhere, you won't find ANY here.

On one side we have a bunch of largely Europeans, packing 5000 year-old Biblical title reports that show they once owned the entire area from the sea to the borders of Jordan and Syria. And they are now here to reclaim it..all of it.

On the other side are the Palestinians... a group that, as it has been said, and proven many times, “never miss an opportunity to miss an opportunity.” Time and again, when some kind of agreement appeared at hand, the Palestinians' leadership (a term I use loosely) sabotaged the deals.

Here again we see American interventions produce more, not less trouble. (“Hi, I'm from America, and I'm here to help.” Run!) And, like the wars we just discussed, our involvement with this never-ending pissing match has cost us dearly.

U.S. military aid to Israel was $2.775 billion in 2010, $3 billion in 2011, $3.07 billion in 2012 (and $3.15 billion per year from 2013-2018.) Washington also provides aid to Palestine totaling, on average, $875 million annually. (Imagine what that money could pay for here at home. And you will have to imagine that, since it didn't provide squat here at home.)

The Israel lobby wheels out a battery of arguments in favor of arming and funding Israel, including the assertion that a step back from such aid for Israel would signify a "retreat" into "isolationism." But would the United States, a global hegemon busily engaged in nearly every aspect world affairs, be "isolated" if it ceased giving lavish military aid to Israel? Was the United States "isolated" before 1967 when it expanded that aid in a major way? These questions answer themselves.

"If it weren't for US support for Israel, this conflict would have been resolved a long time ago," says Josh Ruebner.(national advocacy director for the US Campaign to End the Occupation and author of Shattered Hopes: Obama’s Failure to Broker Israeli-Palestinian Peace) (Source)

Israel has become so accustomed to the US caving to their demands, it now lobbies our Congress directly, like a de facto US state, encouraging opposition forces in Congress to reject the policies of a sitting US President. Imagine that. Oh,wait, you don't have to imagine it, do you:

So, the solution agaun is clear: Walkaway. Stay away.

What would happen, you ask? Well, on the Palestinian side what would happen is they would realize that no one was going to come to their rescue the next time they dig their heels in and refuse to accept anything less than the entire loaf. And that they themselves will have to rein in their Hamas factions before those nuts get the entire Palestinian population embroiled in another bloody war with Israel...which would likely be the last one.

For Israel our total disengagement would also send a message: Game Over. So, you don't want to get out of the West Bank? Fine. It's yours. In which case Israel's ever thinning democratic veneer would be stripped away. Once stuck with all those Palestinians – who are outbreeding Israelis by a long shot -- then officially part of Israel, they would have to decide... do we let them vote? If they do let them vote, Palestinians will out-vote white Israelis and would like rally much support form Israeli Arabs as well. Don't let them vote and Israel would become a full-fledged apartheid regime....and good luck with that.

By announcing we're out of ideas and out of patience with both sides, both sides will be tossed hot potatoes they will have to juggle themselves. Then let self-interests shape their decisions, unencumbered by hopes some outside force will charge to their rescue.

Might A House Divided Be A Better House?

By Stephen P. Pizzo,

Racontuer-at-Large

Those of us who paid attention in school may remember Lincoln's warning that “a house divided cannot stand.”

True then, but now? I'm beginning to think not, not now, not today.

While a lot has also remained the same since Lincoln's warning, today the consequences are even more serious.

Many, maybe most, in the deep south still chaff under the yoke of a Yankee-dominated central government seated in Washington, DC. And now those Yankees have heaped one final insult to their defeated secessional ambitions... exiling their beloved Confederate battle flag.

Slavery is gone, but racial tensions are as high as ever, not just in the deep south, but in every major city in the Union.

Christianity, once the dominate faith from coast to coast, north to south, is still strong, but rapidly losing its grip on that dominance, and they don't like it. Increasingly the term “persecution” laces their angst-filled protests. And here too, those “liberal Yankees” have heaped one final insult upon the faithful; letting men marry men, and women marry other women.

Science has made enormous strides over the past century and half, the fruits of such that make our lives better fed, better housed, healthier, more productive and less burdensome. Yet science has joined the “suspicious” central government as a major source of angst and distrust among millions; they suspect conspiracies are afoot, see scientists as concocters of lies and disinformation and demonic attackers of religious scripture. Even vaccines, which have saved countless billions of lives over the decades, are now under suspicion among many.

Then there's the battles over our shared physical environment. Even as it decays before our very eyes, millions of otherwise sane American citizens deny it and, rather than rising to the occasion, cling furiously to the very activities that lay at the center of those declines.

Of course I could go on and on; resistance to gun regulation, even as rivers of blood flow in our streets, resistance to strong financial market regulations, even as the bills from numerous previous financial meltdowns accrue interest in our burgeoning national debt.

Yet there are major constituencies on both sides of every single one of these issues. Both sides believe, unshakably in most cases, that they are completely right and the other side, the “Libs” or “Right Wingers,” are completely wrong. And they're not about to change their minds, not about any of it, not now, not ever.

And, since that's the case, both sides will do whatever it takes to gum up the works so the other side cannot prevail.

Which brings us back to Lincoln's admonition, and an opportunity to evaluate it in terms of our own times. He was of course right, though his goal was to preserve a single union. But looking at that statement today leaves me to wonder. Today the nation is still divided, but it's the House where that division threatens most. Our House is, both figuratively and literally, divided, as is the US Senate. And, at the bottom of it all, the electorate. And it should now be becoming abundantly clear that this House cannot stand. In fact, it is already not standing, but failing, completely.

Which begs the question: If this house cannot stand, due to the host of intractable disagreements on policies, fiscal, social and military, might it not be wise to divide this house, this time peacefully, thoughtfully, purposefully.

What would be the advantages to such a separation? Without getting into the fine points of where the borders would be drawn, let's just assume it's, once done, there would be a Red State and Blue State assemblage. (Of course many voters would find themselves on the wrong side of a border and will, over time, either accept their minority voting status or move. Time will take care of that.)

First, both new entities would finally get federal governments that reflected their citizens world, social, fiscal views. That would, in turn, create legislatures that could function. Citizens would finally get to see their views translated into policies they can see and feel.

Second – and I consider this the most important – both liberals and conservatives would at last have an opportunity to field test their most precious beliefs. Reds could slash taxes on corporations, cut social programs to the bone, outlaw abortions, ban same-sex marriages, repeal all affirmative action laws, bar foreign immigrants, deport undocumented aliens in wholesale lots. Blues could increase taxes on corporations and the rich, use the extra tax revenues to boost their social safety nets, modernize their infrastructure, and outlaw greenhouse gas producing fuels.

I think I know which side would shine over the coming 50- to 100-years but, who knows. The issue is that nothing...and I mean nothing, is going to get done under the current state of dis-union. Conservatives and liberals are, quite simply, “wired” differently. There is no chance of reconciliation here. This marriage is over, all but for the divorce.

Since the end of the Civil War the notion of breaking up the Union has been the ultimate sacrilege. But now, today, look around. Think carefully. If we can no longer function as a single family, why not mutually agreeable separation, with visitation rights?

Why not allow both the Right and the Left a chance to find out, once and for all, which has the best workable solutions to our modern-day challenges? Surely neither has all the answers. Each will have some successes and some failures. Scientists would call this a “controlled experiment,” which is, of course, the only kind of experiment that yield results which can be trusted.

Or we can just keep doing what we've been doing. Which means we will keep getting what we've got; a central government that does not function, that cannot come to grips with the serious, even life-on-earth threatening events, facing the nation. A central government that fiddles while Rome burns.

Paris, huh. What now?

By Stephen P. Pizzo 

Will this week’s Paris attacks become just the latest in pop-up terrorist attacks where we mourn the dead and move on, until the next one?

Likely.

But … and this is becoming a bigger and bigger “but” with each such event ... maybe not. Maybe this time someone will come up with an actual effective response.

After all, since these fundamentalist, nihilist groups thrive in their 10th-century throwback religious, cultural venues, they will not be going away. Instead they will continue their barbarian-like crusade(s) against those they decide are unworthy of liberty or life.

Sure developed societies have more economic vim and vigor, superior infrastructures and large modern military machines. These jihadists can pose no genuine strategic threat, right?

Actually, no. They can. And, in some ways they already have. And, if they continue pulling off stunts like 9/11, Madrid and London train/subway bombings, Mumbai attack, the downing of airliners and now Paris, they will succeed. They will not succeed in taking over developed nations, but rather ruining them, destroying everything that makes them worth fighting for: freedom of speech, freedom of travel, freedom of assembly and the machinery of “business-as-usual” that lubricates the very gears of of all that in free societies.

For example, if airliners keep falling out of the sky, filling TV screens at home with the latest horror, how many ordinary folk will still want to fly to Orlando for a week at Disney World? Will happy newlyweds eagerly climb aboard a plane in Newark to honeymoon in Hawaii? How many business travelers will put up with wasting hours of their valuable time standing in increasingly intrusive security checkpoints at every port or entry or exit?

Airlines, which almost always operate on the thinnest of margins, will not be able to raise fares to make up for the dramatic plunge in revenues. And once all checked in luggage will have to be searched, all ot it, not just the 5% that are searched now, you and your luggage may never meet again, at least not at your intended destination.

It would not be more than a decade of this and the only remaining airline would be nationalized just to enable developed nations could cling to an ever-shaky claim of normality, that “the terrorists aren't winning.”

Planes will not be the only form of public transport affected. Buses, trains, urban subway systems, each offer terrorists the most bountiful of killing grounds. Imagine a New York City where working folk are too terrified to go to work because, to get there, they have to literally risk their lives underground locked in a metal tube every day. How many will take that risk just for a paycheck?

And so-call public venues will become increasingly un-public venues as attacks on large crowds chill such gatherings. The “public square” Americans are so found of celebrating... well forget about that too after more public squares run red with public blood. Rock concerts, campaign gatherings, protest marches; each suddenly takes on the potential of becoming fatal, causing even the most hardened activist to rethink their activism; “Yeah, I know I have said I am willing to die for this cause, but I'm sure as hell not willing to die for that, whatever the hell 'that' is.” And so once vibrant democracies become less and less vibrant.

No business venture is more fraught with risk than the restaurant. Even in the best of cases, restaurants come and go like buses at a bus stop. Once terrorists shoot up or bomb enough restaurants, those who do dare dining will be seated at tables far from windows or doors, to make them less attractive targets. And al fresco dining? Forget about it. Who wants to eat an meal while feeling like a sitting duck in a carnival shooting booth? (“Please pre-pay for your meal in case you have to flee before finishing.”)

Little by little, unchecked, terrorist attacks on all things modern, Western, democratic and financial, will force one developed society after another to become less and less open, less and less efficient, less and less risk-oriented, less and less fearless, less and less free.

So, if what you ever wondered if terrorism could ever pose a genuine strategic threat to modern societies, there it is. It is not a process in which modern cultures reach down raise backward cultures out of darkness, but one in which backward cultures reach out and pull modern cultures , down into their familiar darkness, their sectarian and social dysfunction, down into their hell.

I began by asking if the latest Paris attacks would spark a fresh response, or just more of the same. Well, I don't know. I tend to doubt this particular attack will result in any spectacular changes. It may take more before every nation affected understands they are the fogs in a classic “boiling-a-frog” process, as I described above.

But when the change in tactics by those being attacked does come, what on earth could it be? After all, we've tried bombing the crap out of them already. We tried ground invasions and occupations. We tried lavishing billions in cash on terrorist breeding ground regions. We tried buying off their politicians and generals. Not only has none of that worked, but it's only made matters worse.

So what's left to try? It's good to remember that every time developed nations have tried to sort out secular issues and redrawn borders “for them,” it only made matters worse for the generations that followed. Short of killing every man, woman and child in the entire region, what can/should be done?

I don't know. After attacks like the most recent one in Paris, my Sicilian genes vote loudly for the killing the whole lot of them and being done with it. Of course, once I calm down, I understand that is not a choice on anyone's to-do list. (Okay, maybe Dick Cheney.)

I do think though that, if not a nailed down solution, we can at least come up with a list of things that need to happen, one way or another:

• Stop trying to accommodate the mass exodus flooding Europe with refugees from these troubled lands. Not because I think they pose a danger to Europe, but because letting them all leave Syria, Iraq, Afghanistan etc, is bleeding those nations, not of their terrorists, but of the very educated professional and small business classes they will need to rebuild. If allowed to continue the only people left in these countries will those who only know war, those filled with free-floating hatred of... whatever. So stop it. Yes, it will cruel to force these masses to continue living in those war zones. But they represent the future of those countries. Without them, there is no future. The other reason to make them stay is they may well prove a more effective counter-force to the ISIS types. Forced to stay they will also be forced to take stands, to fight, to organized, to resist, from within. It is, after all, their countries, their people, their wars.
• Most European countries now have large Muslim communities. These communities tend to be separate from their host countries. This is natural and expected. Immigrants like to hang with folks that speak their native tongue, have the same customs etc. And being a non-white immigrant in a predominantly white country brings with a long list of hurdles, some expected and many unjust. Nevertheless, these Muslim communities still share a responsibility to the country housing them. If they expect to stay and work and send their kinds of public schools in the hope they will have better lives they have had, then they need to start policing their own communities, They need to aggressively finger individuals or groups within their communities that not only threaten their host country's citizens, but threaten their own dreams for a better life. If they refuse to do so then they can't complain when rightwing politicians point them out as part of the problem, and start passing laws they won't like very much.
• France, England, Germany and Brussels all have long lists of their own Muslim citizens who have gone to the Middle East to join ISIS or al Qaeda, and worry about what will happen when they return home. Which begs the question; why do they have to be allowed to return home in the first place? If they have evidence that a citizen trying to return to Europe has been working at any level with terrorist groups, then refuse them reentry. Revoke their citizenship and let them figure out how best to get back into the good graces of the civilized world. Meanwhile them not returning home means the already overstretched security services will have one less suspect to keep an eye on. Finally, now stranded in the very “caliph” hell scape they left home to fight for, their online whining will serve a warning to anyone else thinking of taking a similar leap into that abyss.
• It's long past time to reel in our so-called “allies” the Saudis. Their insistence on continuing to fund its radical and violent Whabbai version of Islam has been, and continues to be, a part of the problem. Any any Saudi “prince” caught funding terrorist activities or groups, needs to be blacklisted from any and all travel or financial dealings with the rest of the world. Bang. Just like that. No more coddling that pack of spoiled wastrels.

That's a start, not a solution, but a start. We have to be ready to try different things, things that have, for diplomatic reasons and political correctness have been off the table. Because if we just decide the Paris attacks and others are just part of our “new normal,” we will not care much for the world it creates, and not in some distant dystopian future, but quickly, in our own lifetimes.

And, if it is allowed to get that bad, citizens in affected developed – devolving – societies, will get very angry. And that in turn will force politicians in those countries to an all-out military response, ala World War II. Millions will die, citizens in cities like Damascus will get a taste of what it was like to have lived in Dresden in 1945. And then what?

Well, once that dust settles we'd find ourselves back in 1918, when Britain, France and Germany decided to divide up the Middle East to suit themselves, drawing borders where they liked, ignoring tribal lands, sectarian divides or the needs or wants of the indigenous populations. And all they accomplished was to set the stage for today's chaos.

So, short of “killing every man, woman and child” in that region, we need to figure this out, and soon. More of the same just ain't gonna cut it.

News For Real: Why The One-Percenters Keep Winning

News For Real: Why The One-Percenters Keep Winning

Why The One-Percenters Keep Winning

By Stephen P. Pizzo,

 Raconteur-at-Large

Those of us who have been life-long liberal/progressives have long complained about the influence of money and vested interests in politics. It’s our meme, what the dogmas of “trickle-down economics” and tax cuts are to the conservative camp. (Never mind that decades of data show's neither actually works...)

But conservatives have something that does work, and its worked for centuries. It's what makes the Koch brothers and their ilk such successful bulwarks against much needed change. This tool, or weapon, if you will, is well described by Francis Fukuyama in his book, The Origins of Political Order.

“Any institution or system of institutions benefits certain groups in a society, often at the expense of others, even if on the whole the political system provides public goods like domestic peace and property rights. Those groups favoted by the state may feel more secure in their person and property, them may collect rents as result of their favored access to power, or them may receive recognition and social status. Those elite groups have a stake in existing institutional arrangements and will defend the status quo as long as they remain cohesive. Even when society as a whole would benefit from institutional change, such as raising taxes in order to pay for defense against an external threat, well-organized groups will be able to veto change because for them the net gain is negative.”

It is probably a good time now to point out that Fukuyama wrote these lines in the chapter of his book entitled “Political Decay.” He calls this stage of a political evolution, “stable dysfunctional equilibrium, since none of the players will individually gain from changing the underlying” status quo they have no intention of allowing change to happen, no matter how dysfunctional that renders governance:

“...the fact that societies are so enormously conservative with regard to (preserving existing) institutions means that when the original conditions leading to the creation or adoption of an institution change, the institution fails to adjust quickly to meet the new circumstances. The disjunction in rates of change between institution and the external environment then accounts for political decay...”

This, he writes, is a naturally occurring accretion of power into the hands of fewer and fewer within a state. And the more powerful the few become, the easier it is for them to defeat demands for change from the many below them:

“This kind of collective “action-failure" is well understood by economists....entrenched interest groups tend to accumulate in any society over time, which aggregate into rent-seeking coalitions in order to defend their narrow privileges. They are much better organized than the broad masses, whose interests often fail to be represented in the political system.”

The results of this disproportionate sway over the political apparatus can be seen today in the dysfunction in Washington. Though “dysfunction” is actually a misnomer. It would be better called “mandated dysfunction.” What we are seeing is not a failure to act, but a mandate not to act. That mandate being enforced by the handful at the very top of the domestic fiscal mountain. They have no need for change, since everything is working just fine for them. In fact, the only thing that threatens “their thing,” as the Mafia called their rackets, is change. Change is enemy. So it is to be stopped dead in its tracks wherever it tries to emerge.

Besides the obvious and growing disparity in distribution of wealth, this condition risks more than human suffering. With climate change beginning to wreak havoc around the globe, the elite see any shift to alternative solutions as direct threats to their long-established and still profitable enterprises. So the very existence of our species may depend on figuring out ways to unsaddle these overlords of the status quo:

“The ability of societies to innovate institutionally thus depends on whether they can neutralized existing political stakeholders holding vetos over reform.

Opportunity does eventually emerge to do just that when this process of power-accretion moves from the “dysfunctional equilibrium,” to unstable dysfunctional equilibrium. But then the choices get a bit unsettling for most progressives.

“The stability of dysfunctional equilibria suggest why violence has played such an important role in institutional innovation and reform. Violence is classically seen as the problem that politics seeks to solve, but sometimes violence is the only way to displace entrenched stakeholders who are blocking change. The fear of violent death is a stronger emotion than the desire for material gain and is capable of motivating more far-reaching changes in behavior.”

And therein lays the rub. Liberals and Progressives tend to eschew violence as way to solve social problems. And we are proud of that, and rightfully so. Violence is one of those “shove all the chips on the table” moves. One can never be certain it will turn out to their advantage. It may go the other way, making the oligarchs even more powerful, more oppressive. So instead, we try reason. 

Which leaves us with a dilemma:

“It is not clear that democratic societies can always solve this type of problem peacefully...This means that the burden of institutional innovation and reform will fall on other, nonviolent mechanisms... or that those societies will continue to experience political decay.”

And that, my friends, is why the One-percent continue to win;-when push comes to shove, we don't shove back hard enough.  

Wall Street's Borg Collective

By Stephen Pizzo, News For Real

08/24/2015 -- The world’s stock markets are in a tailspin. Another tailspin. Market crashes, which used to be a once-every-generation affair, now seem to visit us about once every seven or eight years.

Why?

Are the world's workers becoming less and less productive? No, just the opposite, they're working harder, for longer and for less money every year.

Are companies less profitable? Nope. Just the opposite there too, for the most part.

So what's up doc?

Blame it on the very technology you're using to read this now. The Internet, and related networking technologies, have changed how money in these markets flow.

In the past investors were like herds of roaming bison, in search for the next green pasture. They were widely dispersed. Separate herds went off in their own directions, following their own instincts, in search for their next buffet. Some did better than others. And, by the time word got out that some other herd had found a bonanza, by the time the others got there the bounty had been pretty much consumed.

Which is why those herds of investors back in the day were considerably less reactionary and more stable than we see today.

Today what we have is a hyper-connected, worldwide investing “blob” that moves as a single herd, able to move en-mass, almost instantly, to exploit a new real, or imagined, opportunity. They are the investment world's version of Star Trek's “Borg Collective.”

So one quarter everyone wants to be in bonds, the next the herd gets a whiff of smoke (a Fed move up on rates,) and the entire herd stampedes, running mindlessly in all directions until it comes to a collective agreement on what they believe the next big opportunity might be. Then they all head to it.

In the short run such behavior creates it's own affirmation. After all, when everyone whats to buy the same thing, at the same time, the price of that thing shoots up. And so the herd is happy and, as long as it stays happy, the price keeps going up.

But, as they say on Wall Street, “trees don't grow to the sky,” so, sooner or later the greater-fool theory breaks down as fewer and fewer buyers are willing to buy at increasingly ridiculous valuations. And then it crashes.

In the past crash in one market segment, while unpleasant, was rarely catastrophic to overall market as there were “other herds” grazing happily there. But no more. Now all the money heads where the Borg Collective has decided to in its collective “wisdom.” And why not? Even those who know what's likely to eventually happen, they also know that, when this mega-herd moves, prices move up. So why not pocket some sure money while it lasts?

Of course that's the trick in this new markets normal; how long to stay with the herd. When to hold-em, and when to fold-em. In the end way too few fold-em while there's still money to made. So most of the collective herd panic all at once when the obvious becomes, well, obvious.

That's it. That's why the market dove a thousand points at its opening this morning. Of course it will go back up again. The collective herd, while in panic mode now, is already on a search for the next market(s) they can pump for all they're worth.

And remember; resistance is futile. Those markets will be assimilated, exploited, gutted.

Memo To My Progressive Friends

The past few weeks I've been sitting here at my computer watching many of my closest friends wrestling with their own convictions. I know these friends well, so I know what their real convictions are, and I share them. They are progressives, old progressives, veterans from half a century of the most important social struggles of the age; Vietnam, civil rights, voting rights, women's liberation, the environment. They are among the best amongst us.

Yet they seem to have found themselves stuck with a Hobson’s Choice, and it’s caused them to kind of lose their progressive GPS signal a bit. 

Now don't get me wrong. I'm not condemning them, just observing. I do understand the conundrum that's causing the static. They have a terribly flawed candidate for President, Hillary Clinton, currently in the lead for her party’s nomination -- if only because no other party big shot has challenged her. Against her is arrayed a small herd of Republican candidates that no satirist (or doomsayers) could have dredged from the darkest corners of their fevered minds.

These good friends, rightfully, fear that if their lead candidate does not prevail, all manner of awful things will descend upon us; Supreme Court, environmental disasters, a gutting of our national regulatory apparatus, rollbacks in civil rights and voting rights, restrictions on women's health choices, war, etc.

And yes, a GOP victory in 2016 would, to one extent or another, likely result in much, if not all, the above.

So I understand, and do not condemn my old progressive buddies for their steadfast support of Hillary Clinton. They're scared. And, with 2016, probably the most unsettled and dangerous election I can remember since the Nixon days, I'm scared too. And, if you're not, you're not paying enough attention.

Still I have to say that, acting on fear has been something I've tried to avoid my entire life. Fear is the parking brake of life. You either release it, or you're not going anywhere. And I'd like them to release it now. Because, while they feel that supporting Hillary is the best way to insure that none of the GOP wing-nuts never get within spitting distance of the Oval Office they, in the process, are jettisoning their most core values and beliefs. And doing so erodes the power of those values at a time we need the pursued even more vigorously.

So I ask them, and you, just do this for a moment: change shoes. Make Hillary the leading GOP candidate (not too much of stretch.) Now go through what we've learned about her and her values and her governing principles. Remember the “scandals,” real or contrived. Remember how her husband governed. 

First, we know she, like her husband, believes rules that prevent her from getting what she wants, are for not rules, but obstacles to over come. So she walks the razors’ edge of right and wrong. And, as always happens to those who think they are above it all, she often slips off that edge ending up on the wrong side.

Emails? Yeah, that's the most recent example, but there are plenty of others, large and small, that go all the way back to her disastrous and hubris-driven belief that she and she alone could repair America's broken healthcare system, in secret, behind closed doors, with the help and financial support of many of the same big medical and pharma players who caused, and profited from, the mess to begin with. That failure set healthcare reform back by two decades.

To see Hillary as a progressive is also a stretch. Her best friends (and contributors) a from the far-upper crust of America's financial world like Goldman Sachs. Her husband signed the repeal of Glass-Steagall, which contributed to the massive financial collapse in 2008. And just last week Hillary, when asked about that, supported that repeal, claiming it had nothing to do with the troubles that followed.

She supported, and continues to support, NAFTA, which was no favor to working Americans, to put it mildly. Now she supports the pending TransPacific Partnership trade deal as well. Some protector of the working class. And the Tar Sands pipeline from Canada? She won’t say, but we know, don’t we.

Once “dead broke,” she is now richer than Imelda Marcos was when she was in the clover... the similarity between the two also nags at me, though everyone tells me I'm crazy. Maybe.

Don't worry, I'm not going to drag you through the Clinton Chronicles of Horribles and Incidentals, from Whitewater forward. You remember, I'm sure. When I think of the Clinton's the image that always flashes in my head is of Pigpen, the Shultz charger who, in every frame in the cartoon, trails a cloud of dust and dirt along with him. That's Hillary.

Then she never takes personal responsibility for any of it. It’s aways one kind of "conspiracy" against her or another. There is something in that too that unsettles me about her. I once knew a woman who later proved to be a borderline psychopath. (Oh boy, now I've done it – crossed the line into truly nutty territory, right?) Well, I'm not saying Hillary is a psychopath. All I am saying is that one of the key traits this other woman displayed was that nothing that went wrong in her life was ever her fault. She always had a excuse, and explanation, no matter how much it strained credulity, she never took personal responsibility. (She eventually was sent to prison for embezzlement.)

So, there you are. My friends want me to stop harping on Hillary’s glaring progressive shortcomings. They say that I, and others like me, are “undermining” her. (Though her own behaviors seem to be doing that without much help from us.) But that if I and progressives like me don’t knock it off we are going to end up putting another Republican in the White House.

But I too am faced with a conundrum. To support Hillary Clinton I would have to jettison the very core values that formed and continue to form my life and politics:

- I abhor a liar. 

- I don’t like people who cheat. 

- I hate people who talk one way, and live another. 

- I do not trust “triangulating” opportunists. 

- I am dislike and distrust those who insult my intelligence by feeding me a line of self-serving bull instead of the truth. 

- I am not buying the claim that a candidate worth millions of dollars and who runs with Wall Street’s top dogs, knows or cares a damn thing about ordinary, working Americans.

And I am not going to let fear change any of that. Which means I can't, and won't, vote for Hillary Clinton if she ends up the nominee. I will just skip that box on the ballot. There are some things that are simply more important than a single election.

Because, if it's the current corrupt system you want to change, you don’t get there by voting for it.

Help Me Out Here

By Stephen Pizzo
stephen@pizzo.com

Like the rest of you, I just have to sit and watch and listen to the news from the Middle East and wonder who's right and who's wrong. Clearly from the state of affairs over there, most everyone has been wrong – at least those of us in the West who keep thinking we can “fix” that ever-so broken region.

Anyway, as we now see Iraq falling apart (for the umpteenth time in recent memory) we are hearing the hawks on the right complaining that “Obama's strategies have lost the Middle East.” And, they suggest, it's time to put more US “boots on the ground.” That term is starting to ring familiar, like ones from earlier failed imperialistic conflicts. Remember “light at the end of the tunnel?”

I have tried to see both sides of this argument. But for the life of me I can't see what US strategic interests need protecting in those arguments. In fact, the more I learn, the less and less I believe there are any. And, as such, my solution of choice has become “benign neglect.”

Here's my thinking – and if you disagree, I'd love to hear why and what you would do instead. But for now, here's my take:

Iraq:

I keep hearing from the right that we need to force some kind of “political solution,” there. Trouble is this is not a political problem, it's a tribal/religious problem. It's not Democrats fighting with Republicans, it's Sunnis fighting Shia and visa versa, and the Kurds fighting both. The three groups don't want to get along, any more than the Bloods and the Crips want to sit in a circle and sing camp songs of love and acceptance. They want to kill one another, hopefully in wholesale lots.

How do we craft a “political solution” to that? You don't. You can't. We tried... several times now. It's simply not going to happen. Ever.

That leaves only two logical responses, and each lives at the extreme ends of the list of possible solutions. The first, leave them alone. Let them fight all they want. Stay out of it. Let them live with the full implications of their deepest desires for as long as it takes for them to either get it out of their systems -- or for them to finish off one of the sides. Since only the Kurds are worth an ounce of Western concern or support, make sure they have enough firepower to defend the areas they've carved out for themselves already, but otherwise, stay out of it.

The other way is the “all in” option. And when I say all in, I mean ALL in. NATO, the whole group... 500,000 to a million troops from all NATO countries plus Arab “allies” like Saudi Arabia and Egypt. Flood Iraq with multi-national forces, partition the country into three areas (already really happened) and help the Sunnies and Shia and Kurds set up their own independent countries... no more Iraq. Gone. If they want to form some kind of regional coalition years later when everyone has calmed the hell down, fine. But for now, get into the region you prefer, mind your own business (now that you have your own businesses) and “deal” with those who don’t comply.

When it's a raging fire, you throw everything you have at it, you don't plink around the edges. Those who want to “fix” the mess in Iraq need to understand that... understand that it takes an all out, no-holds-barred response, not just some boots on the ground and some careful surgical airstrikes. It means lots and lots and lots of people, most of them civilians, will die.

Personally I vote for Option 1: Stay out of it... all of it.

Because, no matter which option we choose, Iraqi civilians will die in the tens of thousands. They are doing that right now. They've done that, to varying degrees, for 1500 years. And they are highly likely to continue doing just that for many decades to come. That's not pessimism, it's realism. It's history. Recent history too.

The difference, (and it's a damn big one,) is that with Option 1 we are not accomplices in mass murder.

Europeans went through this kind religion-fueled internal warfare hundreds of years ago. When Catholics and Protestants got tired of killing one another, it ended... if only recently in N.Ireland. That's how you end these kind of Hatfield/McCoy religious feuds – you let them burn themselves out. If others keep jumping in a putting just enough water on the flames to knock them down, then leave, it all just starts up again.

And that's where we are in Iraq. A forced partition would be a repeat of what created this mess in the beginning; the British and French drawing borders in that region that suited them, while ignoring the long smoldering fires of religious hatred and tribalism.

So I rest my case for benign neglect. Step away. Watchful waiting. Let the waring parties wear themselves out. Let the region reorder itself in ways that make sense to them, not us. If Iran wants to own the Shia area of Iraq, they are welcome to it. It would serve them right.

That's it. What do you think? I'm open to a better idea... tho I seriously doubt there is one.

Special Report
by Stephen P.Pizzo
October 2007

You may have noticed that we were recently treated to a full-scale Bill and Hillary charm offensive. Bill has been touting his charitable juggernaut --immodestly branded with the Clinton logo as "The Clinton  Global Initiative." And he has a new book out -- just in time for the primary campaign season -- with the warm and fuzzy title, "Giving."

All that dovetailed nicely with Hillary's  blitz of the mainstream media Sunday talk shows where, in a single morning, she held a rapid-fire round of high profile, prime time satellite interviews with every network that matters. She smiled - a lot, looked relaxed and laughed - a lot.

It was a Clinton Inc. media tour de force. This power couple have always been a team, and they still are. Anyone who thinks the timing of Bill's goodness offensive and Hillary's race for the Democratic Party nomination are mere coincidence just haven't been paying attention for the last twenty years or so.

As the couple knew they would,  the media took bait. The Clintons called the tune and as they twirled to the that tune a real story lurked right under their lazy noses -- a story that says a lot more about the Clintons than the puffy  "did she laugh too much" pablum the media spun for public consumption.

It was during the height of that Hill-Bill media blitz that an email popped into my box. It was from a well-connected old friend on the east coast. He wrote he was at a Clinton fund raiser rubbing elbows with, to quote him -- “an old friend of yours.”  Knowing this guy as I do I sensed sarcasm, and I was right.

“It's Farhad Azima,” he announced, knowing, I am sure, that the very mention of this character in any setting would get my attention, but at Clinton fund raiser! Holy cow!

I shot him an email back asking what that guy was doing anywhere near a Hillary Clinton fund raiser.

He replied, “Not Hillary. Bill.”

Ah, yes, it was one of  Bill Clinton's Global Innovative fund raisers. The whole previous week had been all CGI all the time, as Bill hosted the rich and powerful from around the world all looking to do well by doing good.

But the question remained; what was Farhad Azima, doing there? Why would the Clintons expose themselves to bad publicity just a couple of weeks after Hillary was forced to return nearly a million bucks she took from felonious fugitive, Norman Hsu? (Another instance where a single Nexis/Lexis search by a curious reporter would have broken that story months ago.)

Admittedly Azima is a bit of a different kind of problem since he's never been charged or convicted of any crimes,as Hsu had. But, as you will see if you  read on, there might be a reason for that, a quite extraordinary reason. Still a few Google searches would net the curious reporter some pretty startling allegations -- and lots of them. Sure it's just smoke, but so much smoke it would trigger a five-alarm response from any fire department worths it's salt.

In lieu of a real media vetting of Farhad Azima has become grist for the conspiracy theorists, who have now woven him into nearly every murky event short of the Lindberg kidnapping. In the world of conspiracy theorists 6% of separation is enough to throw their own grandmothers into the mix.

Maybe that's what's kept real journalists away. Anyone who's been a reporter for very long knows that the fastest way to ruin their career is to dive into one of these tales and try to sort the truth from the mis- and dis-information that swirl around characters like Farhad Azima. I personally knew two veteran reporters who were last seen following such bread crumbs sure they were onto the biggest stories of their lives. They're still out there  -- somewhere.

But, since I am retired and no longer have a career to ruin, what the hell.

Besides, Azima and I have a history.


Farhad Azima: Born in Iran in 1941, into a family that was reportedly close to the Shah. 

My first encounter with Azima was sometime back in 1987. My co-authors (Mary Fricker and Paul Muolo) and I were researching for our book, Inside Job: The Looting of America's Savings and Loans. We were trying to figure out  why America's savings and loans were suddenly dropping like flies. When we looked at a small failed bank, Indian Springs State Bank in Kansas City, Mo., we found Azima on it's board of directors. We also found hundreds of thousands of dollars of the bank's money had been loaned to Azima's freight airline, Global International – loans which by then were in default.

What began as a routine probe into just another case of financial shenanigans sparked by thrift deregulation, took a hard right turn into a world swirling with allegations of gun and drug running, illegal Iranian arms shipments and CIA involvement. Azima and his airline were at the center of it all. Nevertheless, we would later learn, Azima seemed to enjoy a kind of prosecutorial forbearance back then that companies like Halliburton and  Blackwater Security enjoy today.

As we sorted through the ashes of Indian Springs State Bank we asked the Kansas City federal prosecutor assigned the case, Lloyd Monroe, if he was investigating Azima's activities at the looted bank. He told us he had tried to open an FBI investigation into Azima and Global International, but immediately received a call form FBI headquarters in Washington.

“They told me to forget about it. Azima had a get-out-of-jail-free-card.”

 (Rather than drag you through that entire tale here, I suggest -- even encourage -- you to read that chapter from out book reproduced on this page. It will enhance your understanding of what follows -- I guarantee it. --- Don't worry. I'll be here when you return ;-)

Azima dismisses what continues to be a steady flow of allegations that his airlines (he has more than one, some held under his umbrella corporation, Aviation Leasing Group, ALG.)  are or have ever been used for US intelligence operations -- like Reagan's illegal "Iran/Contra" arms shipments. It's his story and to this day, he's sticking to it.

But then there's things like this that keep the curious, curious. When then-CIA director William Webster testified before Congress about the failure of Indian Springs State Bank and Global Internationals involvement, he declined to answer questions about Azima's involvement or the loans to his airline in public session. Instead he testified about in closed session before the House Intelligence Committee (October 25, 1990.)

And then there's the fact that Azima's world seems to be one filled with the kind of strange coincidences that just don't happened to ordinary folk. For example, an SEC search of companies listing Azima as a shareholder and/or officer, shows that Farhad Azima and Huffman Aviation's Wallace J Hilliard, are heavily invested together in the same company, SPATIALIGHT INC.. Hilliard and Azima are major stockholders.. Huffman aviation, you may recall, was the flying school where Mohammad Atta studied.

If your read the chapter linked above, you already know that Azima was not the only colorful character who  attached himself to Indian Springs State Bank's vault. There mob money movers out of New York and one of the bank's "business development," executives was a debarred attorney for the Kansas City-based Nick Civella mob family.  The whole thing had a Goodfellas aire about it. Just before federal regulators closed in on the bank it's president, William Everett Lemaster, was incinerated in a single car auto accident family members claim was highly suspicious.  (Lemaster  and another bank executive with ties to Kansas City Civella crime family, also shared positions on Azima's Global Airways Board of advisers.)

In 1983 the Federal Aviation Administration suspended operations of his Global International Airways for safety reasons. Embarrassingly one of its planes carrying TV crews accompanying Reagan to Brazil had made a crash landing. Azima later put Global into bankruptcy. Another of his companies, Buffalo Airways of Waco, Texas, settled a tax lien with the Internal Revenue Service in 2000 and reportedly was fighting with the Justice Department over a $1.4 million bill for cargo service provided to the Pentagon during the Gulf War.

A world in turmoil is a profitable world for the kinds of shadowy, no-questions-asked, airfreight operations like Azima's. (It's no coincidence, after all, that Blackwater has formed it's own, Presidential Airways:

Wall Street Journal, Sept. 30, 2007-- Even as security contractor Blackwater USA faces scrutiny over its actions in Iraq, the U.S. government is deepening ties to its parent company by awarding an aviation affiliate a contract valued at as much as $92 million to operate a fleet of airplanes on missions throughout Central Asia. ... The four-year contract with Presidential Airways Inc. calls for the company to supply specialized airplanes, crews and equipment for flight operations in Afghanistan, Pakistan, Kyrgyzstan and Uzbekistan. Presidential Airways is owned by Blackwater's corporate parent, Prince Group LLC.

Gunrunning allegations have swirled around Azima and his various airlines since the mid-1980s. Besides swashbuckling tales from former Global pilots of being paid with bags of cash and boxes marked as “cabbages” actually containing mortars, Azima's planes, now under the umbrella of his Aircraft Leasing Group, (ALG) have also showed up in interesting places, leased to interesting people, doing some mightyinteresting things.  Whatever Azima's airlines are, they are anything but ordinary. Example here...

A public interest website in Belgium, "Clean Ostend," wants shadowy airlines, including Azima's, to stop using the former US Air Force Base:

"At Ostend Airport, Johnson's Air itself shares since the end of 2003 office, station manager and PO box with HeavyLift, which is part of Christopher Foyle’s airline company Air Foyle, as recounted earlier, known from its two-year business partnership with arms dealer Victor Bout. HeavyLift seems to be the air broker, who organises from Ostend the Johnsons Air flights. However, both companies recently left the Ostend airport after a few adverse publications. ...Johnsons Air was formed in 1995 by Farhad Azima, a native of Iran, resident in the U.S. since the 1950s...At the time of HeavyLift’s shutdown, Azima was its chairman. Reputed as a mayor gunrunner,  he is also suspected to have had close ties to the CIA and has been linked to the Iran-Contra arms-for-hostages scandal ... Also Race Cargo Airlines (another Azima operation) has for years an office at Ostend Airport and even a full-owned warehouse. (Lots more here -- 

During the years when Republicans  held the White House Azima's campaign contributions flowed largely to Republican candidates and causes. That changed once Bill Clinton became President.

Despite the bankruptcy of Global International Airways, Azima always seemed to have money to spread around. By 1995 Azima was back. He was head of Airline Leasing Group (ALG) with air freight operations and cargo jets scattered around the world.  He also seemed to have enough excess cash on hand to grease the palms of whoever in charge at the time. And now it the Democrats and Bill and Hillary Clinton.

Remember, we're talking 1995 now, six years after our book was released. And where was Farad Azima now? Well at the White House, of course, sipping coffee with President Bill Clinton at three of of Bill's coffee clutch awards for major DNC contributors.

White House Coffees:
HOST: President Clinton
ATTENDING: DNC Supporters
LOCATION: Map Room

Farhad Azima, listed as attending on:

October 2, 1995: 


August 6, 1996:  

March 28, 1996:  

But by 1997 someone at the DNC apparently caught wind of the colorful side of their newly generous contributor and hustled to get rid of his contributions by giving him his money back.  Azima was offended:

MAN FORCES CASH ON DEMOCRATS 
DONATION WAS RETURNED UNDER CLOUD, DONOR PUSHES TO GIVE IT BACK 



AP - Rocky Mountain News -- 10-01-1997: Most people hire lawyers to get their money back, but Kansas City, Mo., businessman Farhad Azima used his attorney to persuade the Democratic Party to keep his $143,000 donation. 
In February, in the midst of its fund-raising furor, the Democratic National Committee announced that Azima's donation was among $3 million being returned because it was ``deemed inappropriate.'' 

Azima asked his attorney, E. Lawrence Barcella Jr., ... 

Azima's attorney said he had received no explanation for why the DNC was returning his client's money, and assumed that the money was being returned because of  "misleading and inaccurate news reports" about Azima's past.

Azima's attorney, E. Larry Barcella, Jr.,  served a US Attorney for the District of Columbia during Reagan years and later was Chief Counsel to House Republicans during the so-call “October Surprise”investigation, which looked into allegations that Reagan operatives had convinced the Iranians to hold US hostages until after the Reagan/Carter presidential race... which is precisely what the Iranians did.  Those who believed it, still do. Those who don't believe it, still don't.  In any case, it's a tale for another day.)

Azima appears determined to hedge  his political bets. Not to say there weren't still some potentially useful Republicans around, like US Senatorial candidate Fred Thompson. Azima held a fund raiser for Thompson. Thompson also served, at the time on the board of one of  Azima's airlines, Tennessee-based Capital Airways. Azima came to know Thompson after Azima bought Capitol Airways to Smyrna, Tenn., in 1983. Thompson served on the board of the company and also represented it in legal matters. According to Federal Election Commission records, Azima raised $9,500 for Thompson's campaign at a 1996 fund-raiser at his Missouri home.  

A year later, in 1997, Thompson returned about half of the money raised at the Azima fund raiser. (But FEC records show Azima and his partners at ALG, Mansour Rasnavad, contributed $1000 and $500 respectively to Thompson during the 2000 election cycle. That time Thompson kept it all.)

There was apparently a flurry of reports about Azima's past and around the time Thompson gave back some of Azima's contributions because the Clinton/Gore campaign committee did so as well. Clinton/Gore returned $143,000 the campaign had accepted from Azima and his airline companies.

In response to a question at the White House Daily Press Briefing, Clinton-Gore Campaign Counsel Lyn Utrecht explained the money was being returned because Azima was deemed to be “an inappropriate contributor.” 

You may recall that, at the time, Clinton was using White House access as a reward for contributions to the DNC. Clinton insider, Harold Ickes had even prepared a list of Presidential privileges that could be marketed as rewards to large contributors. including selling rides on Air Force One.

“White House officials have acknowledged that they used events there to encourage and reward donors, but say no solicitation of money ever occurred at the executive mansion. It is illegal to solicit donations on federal property. The White House earlier this week released several hundred pages of documents from Ickes' files, including records showing Clinton liked proposals to use White House sleep-overs and coffees to reward big-ticket donors.”

Even though the DNC and the Clinton/Gore campaign had scrambled in 1997 to disgorge Azima's contributions because he was deemed “appropriate,”a year later they were apparently ready to let  bygones be bygones – though they didn't appear to be particular eager to brag about it:

Azima Donates $10,000 to the Clinton Legal Defense Fund
....Donors were required to fill in a form certifying that they met the criteria and listing their name, address, occupation, and employer. Trustees said careful efforts were taken to vet large donations. Yet, no occupations or employers were listed for several of the $10,000 donors, including some regular - and easily identified -- major political donors....For example, the occupation and employer of $10,000 donor Farhad Azima of Kansas City ... were left blank.  Azima, who heads Aviation Leasing Group Inc. attended three White House coffees before the 1996 election and let Democratic National Committee party officials use his private jet on several occasions.  In fact, 12 of the 39 $10,000 donors (to the Clinton legal defense fund) in the last half of 1998 attended White House coffees during the 1996 campaign. 

Azima was no longer “inappropriate,” at least as far as the Clinton's were concerned. Two years later he was hosting a fund raiser for the former First Lady and would-be US Senator at his Kansas City home, at which President Bill Clinton himself made an appearance.

President Clinton will attend fund-raiser in Kansas City for first lady

Kansas City Star -- October 9, 2000 -- President Clinton will visit Kansas City on Friday to raise money for his wife's campaign for the U.S. Senate from New York. The president will attend a 3:30 p.m. tea at the Ward Parkway home of Farhad Azima, an aviation executive. The suggested donation to the first lady's campaign: $1,000 a person.

Azima said he expected that about 100 persons would attend, meaning that the event would raise at least $100,000 for Hillary Rodham Clinton's campaign. The first lady is in a tight race against Rep. Rick Lazio, a New York Republican.

"I've been in his house many times, so he can come to my house," said Azima, who has visited the president at the White House. 

The DNC had also decided it was no longer inappropriate to accept money from Farhad Azima, because beginning in 2000, FEC records show, Azima donated $25,000 to the DNC -- and this time they kept the dough.

A Global Initiative and a Presidential LibraryI know it's been a while, so let me remind the reader what sparked this article; that email from an old friend informing me that he'd run in Azima at a fund raiser for Bill Clinton's Global Initiative. What was he doing there? A simple check of the CGI website is all it took to find the answer. There he was,  Farhad Azima, listed as of September 9, 2007 as a member in good standing in Bill's CGI. 

Why? Well, a guy owns or controls over 50 cargo jets based around the world, and had reputation for making no-questions-asked deliveries to world hotspots, could come in handy – not just to the CGI's charity efforts,  but to a future President Hillary Clinton.

Finally, what's the best way to weasle one's way into the heart of any former President?  Obvious answer – cough a huge hunk of cash for his Presidential library.

Bill Clinton has steadfastly refused to disclose the names of major donors to his Clinton Library. The reason for the secrecy,  he claims, is that the donors were not told their names would be made public and he did not want to embarrass anyone. But enterprising reporters in Arkansas were able to discover who some of those donors were, and – yep – you guessed it. There listed among those who have donated “over $1 million” to the Clinton Presidential Library is Farhad Azima. 

Now he's working on Mrs. Clinton's affections. In 2005 Azima tested the waters donating $1000 to “Friends of Hillary Clinton.” 


Maybe Bill and Hillary should task one of their dozens of opposition research mavens to take the time to check up on what Farhad may be up to when not attending their fund raisers. Allegations of gun running, legal and otherwise, by Azima's many airlines, abound on the web. Chatter among commercial pilots on websites they maintain to share industry information also abound with references to Azima's swashbuckling airlines.

In November 2006, veteran intelligence reporter and author, Wayne Madsen, reported on his site, Wayne Madsen Reports, the following:

November 21, 2006 -- On Nov. 17/18/19, 2006, WMR reported on the presence of an aircraft linked to Viktor Bout's international weapons smuggling network at Mogadishu airport. WMR reported that the "Boeing-707, registered in Ghana with registry number 9G-GAL, marked with “SACHA” on the fuselage, used the call sign 9QCTA. The plane landed in Mogadishu at 0700 GMT on November 13, 2006. The plane reportedly made previous stops with arms and ammunition at Mogadishu."

WMR has recently learned the aircraft, which is actually registered "9G-OAL," is owned by Johnson's Air of Ghana. Johnson's Air appears to have been founded around 1995 by Kansas City-based Farhad Azima (and may now be operated by Farzin (also spelled Farsin) Azima, Farhad's brother). Azima is well known for his connections to highly placed (and "well-oiled") American friends in Houston and Washington, DC and first became known for his role in the Iran Contra scandal of the 1980's.

Johnson's Air bases a number of its aircraft at Sharjah International Airport, the same location where Viktor Bout's various airline companies base their operations. On Nov. 22, 2005, a Johnson's Air DC-8 (9G-PEL) at Sharjah was spotted with its cockpit windows blown out and covered with cardboard. Buckets were noticed under the engines collecting leaking engine oil. Both are signs that the plane was fired upon in a war zone. Other Johnson's Air planes have been spotted in Maastricht, Netherlands; Ostend, Belgium; Dubai, UAE; Accra, Ghana; Addis Ababa, Ethiopia; Kuala Lumpur, Malaysia; Colombo, Sri Lanka; Budapest Ferihegy; Recife, Brazil; and Nottingham-East Midlands, England.

(See also NYTimes re: Bout & Ostead airbase.)

Maybe some of all that is just so much conspiracy theory nonsense. But there sure is a lot of it. And it comes from so many sources and directions that one has wonder. Web sites dedicated to professional commercial pilots are full of chatter about Azima and his mysterious airlines. 

In my quarter centure of experience chasing these kinds of stories, where there's that much smoke there's  almost always hell of story lurking.

If any of the tales about Farhad Azima's business dealings are true, there's only one explanation for how he's not only gotten away with so much, but continues to prosper and hobnob with some of America's most prominent and powerful individuals -- Azima really does have a get-out-jail-free card.

Which finally brings us to tiny Azerbaijan. Azerbaijan may not be on the minds of many ordinary folks or the media these days, it  has not escaped the attention of some of America's premier movers and shakers. The reason is simple – Azerbaijan is rich in just the kind of strategic resources most needed by the US right now including oil, natural gas, gold, silver, iron, copper, titanium, chromium, manganese, cobalt and molybdenum.

With all those goodies up for grabs someone in Washington decided that what little Azerbaijan needed most right now was a Chamber of Commerce. Of course, not their own chamber of commerce but a US/Azerbaijan Chamber of Commerce.  From the USACC website:

ABOUT US
The United States - Azerbaijan Chamber of Commerce (USACC) is an independent, nonprofit organization based in Washington D.C., whose purpose is to facilitate business and cooperation between the United States and Azerbaijan. Established in 1995, the Chamber has grown to become a major Azerbaijan-focused organization in the United States.

Among the US luminaries making up the Azerbaijan/US Chamber's “Honorary Counsel of Advisers,” 

• James Baker III
• Henry Kissenger
• Brent Scowcroft
• John Sununu Sr.
• Zbigniew Brzezinski

Listed as “Former Members of the Honorary Counsel of Advisers,”

• Dick Cheney
• Richard Armatige

And who do we find right up there at the top of the list of members of the board of directors? Yes. Farhad Azima.  Also listed is GOP presidential hopeful, Sen. Sam Brownback. And there too is one of the chief Neo-Con Iraq War architects, Richard Perle. 

Some company for a guy suddenly cozying up to Bill and Hillary Clinton, wouldn't you say? Could Farhad Azima be positioning himself to be the Ahmed Chalabi of a new Clinton administration? Or is that giving the guy more credit than he deserves? I sure don't know. But Hillary did vote to declare Iran's Revolutionary Guards "terrorists," as the White House wanted. And she did so despite the political damage she still suffers for her vote four years ago that gave Bush the authority to go to war against Iraq. Interesting. Just a coincidence. Another one.

What's it all mean? That's the question working reporters should be asking, not this retired one.

So, why aren't they? Inquiring minds want to know;  would a "President Hillary Clinton" be the agent of change the nation seems to be yearning for? Or would she just be more of the same in skirt?

Iranian expatriate, Farhad Azima, at least, seems to be betting it's the latter.

RELATED UPDATE:
http://www.thenation.com/blogs/campaignmatters?bid=45&pid=240313