Switzerland – Strategic Culture Foundation https://www.strategic-culture.org Strategic Culture Foundation provides a platform for exclusive analysis, research and policy comment on Eurasian and global affairs. We are covering political, economic, social and security issues worldwide. Mon, 11 Apr 2022 21:41:14 +0000 en-US hourly 1 https://wordpress.org/?v=4.9.16 It’s Past Time to Move the United Nations to Switzerland https://www.strategic-culture.org/news/2019/09/29/its-past-time-move-united-nations-to-switzerland/ Sun, 29 Sep 2019 11:00:42 +0000 https://www.strategic-culture.org/?post_type=article&p=200587 With a dangerous right-wing and quasi-fascist administration in power in Washington, one that rejects internationalism and consensus-building, it is past time for the United Nations to move its headquarters and member states’ permanent missions to a more neutral location. One can understand why the UN was originally located in New York. The Rockefeller family donated the land on Turtle Bay on the East River for the construction of UN Headquarters. After World War II, the United States was in a prime position to nurture the UN, something it failed to do after World War I when Washington rejected membership in the League of Nations.

The League’s headquarters in Geneva was a painful reminder to some UN members who saw the world’s first international organization devoted to peacemaking fail miserably to contain Nazi Germany, Fascist Italy, and Imperial Japan. In some respects, although the UN was the successor organization to the League, no one wanted to be reminded that it was at the League’s headquarters in Switzerland where Ethiopian Emperor Haile Selassie pleaded with delegates to stop the brutal Italian invasion and occupation of his country.

The charter members of the UN wanted no reminders of the UN’s toothless predecessor. The UN was an organization with a Security Council of five permanent members that was authorized to meet aggression with force. Unfortunately, the UN’s host nation, particularly under Donald Trump, but also to a lesser extend under Ronald Reagan, George H.W. Bush, and George W. Bush, has shown its willingness to disregard decisions of the UN and violate the US-UN Treaty governing the rights of delegates to freely enter and depart New York while conducting business at the UN.

The US-UN treaty, which may not be violated by Trump without the approval of Congress, was signed at Lake Success, New York in 1947. The signatories were UN Secretary General Trygve Lie and US Secretary of State George Marshall. The treaty guaranteed the extraterritorial nature of the UN headquarters in Manhattan. Furthermore, it guaranteed that the US would not interfere with the expeditious granting of US visas to foreign diplomats and UN personnel transiting through US territory in furtherance of their responsibilities to their own governments and the UN, respectively.

Trump’s xenophobic and far-right policies directed against Muslims, Palestinians, and countries, including Cuba, Nicaragua, Iran, and Venezuela, have resulted in repeated violations of the US-UN Treaty by zealous US immigration authorities. The recent Trump administration threat to deny visas to Iran’s delegation to attend the 2019 General Assembly Plenary Session in New York is a case in point, but not the only one. Similar restrictions by the Trump administration have been levied against delegates from UN members Libya, Cuba, Russia, Venezuela, and Nicaragua. Official observers from Palestine have also been harassed and delegates from the Houthi-led government of Yemen and Abkhazia, non-UN members, have been denied US visas to plead their cases before the UN.

The US-UN Treaty stipulates that the US government will facilitate entrance into the United States, and the use of available means of transportation, of “persons coming from abroad who wish to visit the headquarters.” This would include members of non-member nations wishing to petition or otherwise interact with the UN and affiliate agencies on an official basis. In fact, the US violated this provision in 1975 when US Secretary of State Henry Kissinger saw to it that US visas were denied to representatives of the Kingdom of Sikkim, Western Sahara, and East Timor, who desired to plead their nations’ cases with regard to invasions and occupations by India, Morocco, and Indonesia, respectively. East Timor was eventually admitted to the UN as a member state, but it was after a bloody war with Indonesian occupation forces and US collusion with Indonesia’s military dictatorship.

US policy toward a liberalized visa policy for UN members, employees, observers, and guests has been erratic since the UN’s founding. In 1968, the Lyndon Johnson administration did grant a visa to Commissioner for Foreign Affairs of the secessionist Republic of Biafra Matthew Mbu to visit the UN to plead his nation’s case to UN officials. In 1948, the Harry Truman administration denied visas for two representatives of Indian princely state leaders – the Muslim Nizam of Hyderabad and the Sikh Maharajah of Nabha – to appeal to the UN against aggression by the Hindu-dominated newly-independent nation of India. That same year, the Truman administration failed to permit representatives of the Kalat Confederacy in Baluchistan to appeal to the UN against Pakistani annexation.

The original founders of the UN even envisaged a UN-controlled airport near the UN Headquarters that would deny US immigration authorities the right to deny visas to UN delegates and other guests visiting the UN. Such an airport would have enjoyed extraterritorial status with unhindered travel corridors to and from the UN.

While he was Venezuela’s Foreign Minister, Venezuela’s President, Nicolas Maduro, was subjected to an invasive strip search in 2006 when he was detained for 90 minutes at New York’s JFK Airport while returning home from a UN General Assembly meeting. The detention of Maduro was a CIA-initiated fishing expedition. Maduro was questioned about his alleged role in the failed 1992 Venezuelan coup attempt led by Venezuelan President Hugo Chavez.

Although the League of Nations lacked any real enforcement authority to back up its resolutions, the host nation of Switzerland did yeoman’s work in facilitating the entry to the Geneva headquarters by official parties and guests. The US record on affording equal access to the UN in New York has been woefully inadequate. The UN could very easily move its headquarters to Geneva, where several UN constituent bodies and specialized agencies, including the UN Human Rights Council, World Health Organization, the International Labor Organization, the UN High Commissioner for Human Rights, the UN High Commissioner for Refugees, UN Conference on Trade and Development (UNCTAD), World Meteorological Organization (which is immune to Donald Trump’s redrawing of weather maps with black Sharpie pens), and the International Telecommunications Union are located.

Since Switzerland’s traditional foreign policy is one of neutrality, it is a much better choice to host the UN than New York. Trump’s recently fired National Security Adviser, John Bolton, who was also a past US ambassador to the UN, once fantasized about the top ten floors of the UN Secretariat building being demolished. Trump’s personal attorney, former New York Mayor Rudolph Giuliani, routinely used the New York Police Department to harass UN delegates from countries he did not like. Delegates and staff from Russia, Belarus, North Korea, Laos, Iraq, Ivory Coast, Indonesia, Mexico, Egypt, Kazakhstan, China, Cuba, Cyprus, Zaire, and other countries were routinely issued parking tickets and had their vehicles towed. Russian diplomat Alexandre Zmeevski stated that “his delegation had been given tickets even in some parking spaces reserved for diplomatic vehicles.” Costa Rica delegate Emilia Castro de Barish complained that she “had received two unfair and discriminatory parking citations, including a citation while she had been parked in a parking space reserved for diplomats.” In 1995, Giuliani ordered Palestinian leader Yasir Arafat, in the city to help celebrate the UN’s 50th anniversary, ejected from a New York Philharmonic special concert for the gathered world leaders. Giuliani stated that if the UN did not like his harassment of its employees and diplomats, they could “leave town.”

It was not the first time that a right-wing Republican and extremist Israel supporter told the UN to leave New York. Alternate US delegate Charles Lichtenstein addressed a diplomatic standoff with the Soviet Union in 1983, when the states of New York and New Jersey barred Soviet Foreign Minister Andrei Gromyko’s plane from landing at either JFK Airport in New York or Newark International Airport in New Jersey. The alternative of McGuire Air Force Base in New Jersey was offered. However, the Soviet government rejected the offer as a violation of US treaty rights afforded to the UN. Lichtenstein responded by saying that if member states believed that “they are not being treated with the hostly consideration that is their due, they should consider removing themselves and this organization from the soil of the United States,” adding, “we will put no impediment in your way. The members of the US mission to the United Nations will be down at the dockside waving you a fond farewell as you sail off into the sunset.”

It’s time to honor the requests of Giuliani and Lichtenstein and move the UN from New York to Geneva or another location not subject to the whims of right-wing fanatic blowhards like Trump, Giuliani, Bolton, or the late Mr. Lichtenstein.

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Is It Really True That Switzerland Is The #1 Most-Corrupt Nation, & U.S. #2? https://www.strategic-culture.org/news/2018/02/03/is-it-really-true-switzerland-is-1-most-corrupt-nation-and-us-2/ Sat, 03 Feb 2018 09:15:00 +0000 https://strategic-culture.lo/news/2018/02/03/is-it-really-true-switzerland-is-1-most-corrupt-nation-and-us-2/ Eric ZUESSE

The Tax Justice Network produces a Financial Secrecy Index, ranking countries for the assistance their legal systems provide, to money-launderers, and to all people who seek to protect corruptly-obtained wealth. The higher the score, the more corrupt the government is. The last time this Index was published, in 2015, Switzerland was rated the world’s most-corrupt country, and Hong Kong was then #2. But now, in its newly released global rankings, “Financial Secrecy Index — 2018 Results”, though Switzerland still holds its #1 (most-corrupt) spot, the U.S. has become #2, and Hong Kong has now fallen to #4, which is immediately below Cayman Islands (which is #3, and which had been #5 in 2015).

The detailed report-card for Switzerland says “the Swiss will exchange information with rich countries if they have to, but will continue offering citizens of poorer countries the opportunity to evade their taxpaying responsibilities. These factors, along with ongoing aggressive pursuit of financial sector whistleblowers (resorting at times to what appear to be non-legal methods) are ongoing reminders of why Switzerland remains the most important secrecy jurisdiction in the world today.”

The detailed report-card for the United States notes America’s rising score, and resulting success in attracting corrupt wealth, as follows:

The rise of the US continues a long term trend, as the country was one of the few to increase their secrecy score in the 2015 index. The continues [intending the word “continued”] rise of the US in the 2018 index comes off the back of a significant change in the US share of the global market for offshore financial services. Between 2015 and 2018 the US increased its market share in offshore financial services by 14%. In total the US accounts for 22.3% of the global market in offshore financial services.

The U.S. report-card asserts that, “Financial secrecy provided by the U.S. has caused untold harm to the ordinary citizens of foreign countries, whose elites have used the United States as a bolt-hole for looted wealth.” Of course, this isn’t the largest such “bolt-hole” — it’s the second-largest. Furthermore, the report-card for Switzerland said:

According to the Swiss Bankers’ Association banks in Switzerland hold CHF 6.65 trillion ($6.5 trillion) in assets under management, of which 48 percent originated from abroad: this made Switzerland the world leader in global cross-border asset management, with a 25 percent share of that market.1 In terms of the narrower wealth management sector, Deloitte estimated that Switzerland was also the world leader with US$2.04 trillion in assets under management in 2014, compared to the $1.65 trillion and $1.43 trillion for the UK and US respectively.2 

The “Secretiveness” scores ranged from “100%” meaning total secrecy, to “Moderately secretive” meaning from 31% to 40% secretive; and, so, among the 112 ranked counries, none were unwelcoming of corruptly obtained wealth; all were at least “moderately” welcoming of it.

Furthermore, other factors than “Secretiveness” were also included in the rankings. The 242-page Methodology document says, for example, that “The secrecy score is cubed and the weighting is cube-rooted before being multiplied to produce a Financial Secrecy Index which ranks secrecy jurisdictions according to their degree of secrecy and the scale of their trade in international financial services.” So, countries such as Montserrat,  which ranked at the very bottom, #112, actually had a “Secrecy” score of 77.5% (higher even than Switzerland), but it had extraordinarily good “International Standards and Cooperation” such as with “Anti-Money Laundering” and a 0% score of non-cooperation with “Bilateral Treaties.” Above all: any country, in which only few wealthy foreigners want to park their money, was ranked among the least-corrupt, in Tax Justice Center’s methodology — and “FSI Share,” or the percentage of the global total wealth that’s stashed offshore within the given country, is by far the dominant factor, in their calculations of ‘Financial Secrecy Index’, so that their methodology is simply absurd. The Methodology document ‘justifies’ this deceptive practice by saying:

The ranking reflects not only information about which are the most secretive jurisdictions, but also the question of scale (i.e. the extent to which a jurisdiction’s secrecy is likely to have global impact). In this way, the Financial Secrecy Index offers an answer to the question: by providing offshore financial services in combination with a lack of transparency, how much damage is each secrecy jurisdiction actually responsible for?     

Obviously, any ranking-system that’s ranking countries more according to how big a percentage of the global offshore wealth it’s hosting, than according to how secretive the country is when other countries are seeking its assistance in tracking down assets that are held abroad, is no real ‘Financial Secrecy Index’ at all, and thus should be renamed, perhaps as “International Economic Harm Index” or something else that’s not nearly as misleading as the existing title for it (‘Financial Secrecy Index’) is.

Be that as it may: among the 112 nations that were ranked,

China was #28 and was 60% secretive (60% “Secrecy Score”).

Russia ranked #29 and was 64% secretive.

Ukraine ranked #43, and was 69% secretive.

By contrast, U.S. was ranked as 60% secretive; so, U.S. is actually in their league and is less corrupt than Ukraine, but is ranked as the 2nd-most-‘Secretive’ of all rated countries. Switzerland was ranked as 76% secretive, which places Switzerland among the 28 most-secretive countries on the list — but it has the highest ‘Financial Secrecy Index’ of any, even though more than two dozen countries received a higher “Secrecy Score.”

The nine highest-scoring nations on their actual “Secrecy Score” were, from the top: (#1) Vanuatu 89%; (#2) Antigua-Barbuda 87%; (tied #s 3-5) UAE, Bahamas, and Brunei, 84%; (tied #s 6-9) Thailand, Kenya, Liberia, and Bolivia, 80%.

So: Those were actually the 9 highest-scored “Secrecy Score” countries.

The 7 lowest-scored “Secrecy Score” ones were: 42% (tied) UK and Slovenia, 44% Belgium, 45% Sweden, 47% Lithuania, 49% Italy, 49% Brazil.

But is Brazil really among the least-corrupt countries? Is it, even, really, among the financially most transparent countries?

Furthermore, the detailed report-card for the U.S. asserts:

A wealthy Ukrainian, say, sets up a Delaware shell company using a local company formation agent. That Delaware agent will provide nominee officers and directors (typically lawyers) to serve as fronts for the real owners, and their details and photocopies of their passports can be made public but that gets you no closer to who the genuine Ukrainian owner of that company is: if the nominees are lawyers they are bound by attorney-client privilege not to reveal the information (if they even have it: the owner of that shell company may be another secretive shell company or trust somewhere else). The company can run millions through its bank account but nobody – whether domestic or foreign law enforcement – can crack through that form of secrecy in any efficient or effective way. In the words of Dennis Lormel, the first chief of the FBI’s Terrorist Financing Operations Section and a retired 28-year Bureau veteran, “Terrorists, organized crime groups, and pariah states need access to the international banking system. Shell firms are how they get it.” …

Almost two million corporations and limited liability companies (LLCs) are formed in U.S. states each year, many by foreigners, without the states ever asking for the identity of the ultimate beneficial owners. Some serve legitimate purposes but many, in the words of Senator Carl Levin, “function as conduits for organised crime, money laundering, securities fraud, tax evasion, and other misconduct.”

Nonetheless, the U.S. is granted a modest “Secrecy Score” of only 60% — though the process that’s described there is providing 100% secrecy. Nothing is being said, not even in the Methodology document, about how a country which can provide 100% secrecy, deserves a mere 60% “Secrecy Score.”

The detailed report-card on Switzerland likewise includes considerable text describing a country that seems as corrupt as is indicated in the text describing America. Granting the U.S. a “Secrecy Score” of only 60%, while Switzerland receives a much higher 76% such score, is puzzling; and, again, the Methodology document provides no help to understand what the actual methodology that was used is — much less to justify the methodology.

Perhaps the worst score of all should go to the Tax Justice Network itself.

However, maybe the so-called “International Consortium of Investigative Journalists” deserves an even worse score, because that organization headlined on January 30th, “US, Switzerland singled out for financial secrecy by new index” and reported favorably about this “new index,” which is actually in at least its second edition, since an earlier one was reported in 2015 — so, this isn’t even a ‘new index’ at all, but is at least a three-year-old index. Isn’t a bit of investigative journalism necessary from a purported professional organization of ‘Investigative Journalists’? Or does mere ‘journalistic’ stenography now qualify, even as ‘investigative’ journalism? Is ‘journalism’ now mere PR, propaganda, public relations? And is ‘investigative’ now mere reading and reciting from a source? What’s the difference between PR versus ‘investigative journalism’?

And: what’s the difference between America’s 60% “Secrecy Score” and Switzerland’s 76% one? Based upon the detailed report-cards, how would it be possible to be ‘more corrupt’ than each of these countries is?

The United States Government routinely characterizes any Government that it seeks to overthrow as being ‘corrupt’. Perhaps that fact, more than any other, shows how corrupt the U.S. Government itself really is. Throwing stones from glass houses does no one any good. But it does prove — and not merely by some organization’s flawed methodology — that hypocrisy can sometimes signal a threat that could turn out to be even worse than “Financial Secrecy” or “Secrecy Score” or even than real corruption. When the United States Government called Saddam Hussein, and Muammar Gaddafi, and Viktor Yanukovych, etc., by such terms as “corrupt,” the invasions and coups which were ‘justified’ by means of that U.S. name-calling, perpetrated vastly more harm than any corruption which was, or might have been, perpetrated by those individually blamed persons. Such “stones from glass houses,” as the U.S. casts, contain bombs; they’re actually warheads; they are weapons of mass destruction, such as extremely corrupt governments employ with the most hypocritical of ‘humanitarian’ ‘concerns’, for the mass-victims, which commonly result from their mass-weapons. Corruption that’s so heavily armed, is the worst sort of corruption there is — regardless of whether it’s associated with an exceptionally high “Financial Secrecy Index,” or any other type of extraordinary corruption. And, certainly, the U.S. far outdoes Switzerland, on this score. So: Trump is right — “America is Number One”, after all.

rinf.com

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Switzerland: A Rebellion Is Brewing Against the Bankers’ Shenanigans https://www.strategic-culture.org/news/2016/04/11/switzerland-rebellion-brewing-against-bankers-shenanigans/ Mon, 11 Apr 2016 03:45:01 +0000 https://strategic-culture.lo/news/2016/04/11/switzerland-rebellion-brewing-against-bankers-shenanigans/ Late last year, the Swiss Federal Chancellery was sent a petition with 110,955 signatures, demanding another national referendum. That referendum was spearheaded by activists from the Sovereign Money Initiative. The goal of the referendum is to ban the creation of money by private commercial banks and force a return to the use of actual, tangible money.

The «money multiplier» con game

In economics, when a commercial bank is allowed to create money by extending credit in excess of the cash reserves it holds, this is known as fractional-reserve banking. For example, banks can accept deposits of 1,000 units of legal tender from depositors (which is «real» money, in the form of central bank banknotes), yet based on these reserves, lend out 10,000 units of legal tender, which is ten times more. And that credit will be issued in the form of what is called deposit money, which is in itself a kind of abstraction, because it cannot be used to settle the claims of depositors in actual banknotes. This flagrant duplicity does not end well, eventually culminating in a run on the banks, followed by their collapse.

In economics textbooks, this manufacture of money by commercial banks is called a «money multiplier», and the maximum value of the «multiplier» is set by a financial regulator (usually the central bank) in the form of a reserve requirement (which is the percentage of deposits that must be held in a special reserve fund). Incidentally, these requirements are being abolished in many countries today. It used to be that producing fiat money was viewed as an act comparable to counterfeiting, but now it is simply called a «money multiplier». 

A victory for the alliance of bankers and corrupt politicians

The fractional-reserve banking system has developed gradually over the last three hundred years. The alliance between the bankers and the politicians they corrupted triumphed over public opinion. This chicanery was partially concealed by the establishment of the central banks, which are often called the lenders of last resort. Central banks could extend a lifeline to private commercial banks in the form of various «emergency», «remedial», and «stabilizing» loans. In the twentieth century, state and quasi-state agencies were created in order to insure bank deposits. However, both the «lenders of last resort» as well as these agencies have proven useless during major banking crises. 

In the twentieth century, people stopped thinking about how the monetary system is structured or about the roots of the banking fraud. The «aha moment» only hits once there is a massive economic, financial, or banking crisis.

One example of this sudden burst of insight occurred in the 1930s, when the West was stricken by the worst economic crisis in the history of capitalism. In 1933, a group of prominent economists led by Irving Fisher began to draft a report that was later to be known as the Chicago Plan. The final version of the report appeared in 1936. The report identified the causes of the economic crisis (the Great Depression). The fractional-reserve banking system was primarily to blame, as it had flooded the economy with an enormous supply of fiat money. This money was not legal tender and was issued in the form of credit, which created a debt pyramid. 

This lack of restraint on the part of private creditors stood in contrast to the rules for issuing legal banknotes by the central banks. What they could issue was limited to the size of their holdings in gold. And it’s true that before the onset of the crisis, a number of European countries (particularly Great Britain and France) had restored the pre-war gold standard, which in the US had not been abolished even during WWI. The Chicago Plan concluded that first and foremost, private banks must immediately return to a full-reserve banking system (by holding 100% of demand deposit accounts.)

But the Chicago Plan’s recommendations were ignored. Even in the US, where President Franklin Roosevelt managed to rein in the appetites of Wall Street bankers, full-reserve banking was not resurrected. American banks were more powerful than the president.

Very few economists even remembered about full-reserve banking after WWII. References to it were removed from economics textbooks and «money multipliers» were portrayed as the norm. Among Western economists, the Austrian School of economics was perhaps solely responsible for keeping alive the memory of full-reserve banking, and Murray Rothbard was a particularly bold spokesman for that cause.

The return to the Chicago Plan

In its scope and devastation, the 2007-2009 financial crisis was comparable to the Great Depression of the twentieth century. And suddenly the memory of Irving Fisher’s Chicago Plan resurfaced. In August 2012 two IMF economists, Jaromir Benes and Michael Kumhof, published a paper titled «The Chicago Plan Revisited.» The paper correctly states that the restoration of a 100% reserve requirement would make it possible to dramatically revive the world economy. Gone would be the causes of inflation, the breeding ground for the «bubbles» in real estate and the financial markets, and no longer would pyramids of public and private debt arise. However, by 2012, the world had already returned to a position of relative financial and economic stability, and only a few financial experts took any notice of the brochure written by the IMF economists. 

But 2015 was another story entirely. Dark clouds gathered over the global economy once again. The second wave of the global financial crisis threatened. Economists from various countries began to spend more time pondering the idea of full-reserve banking. In March of last year a report titled «Monetary Reform: A Better Monetary System for Iceland» was drafted by an economist named Frosti Sigurjónsson at the direction of Iceland’s prime minister. Some sources claim that Iceland is preparing for a monetary reform that will include abolishing the system of fractional-reserve banking (according to other sources there will be a dramatic increase in reserve requirements.)

The Swiss oppose «gray» money

One recent event related to the restoration of a normal monetary system is the preparation for a referendum in Switzerland. To a large extent the results of the referendum will depend on how the questions on the ballot are phrased. Of course it is quite impressive that over 100,000 people in that small country were found to sign the petition demanding the referendum. However, given the fact that for many decades the reserve-system problem was a taboo topic, it is difficult to imagine that a few million Swiss will be able to make sense of what is involved. Looking at a sampling of Swiss articles about the upcoming referendum, it is clear that even journalists do not always grasp the issue. For example, some think that the referendum involves a choice between paper money and a cashless system. Others believe that this is a question of backing money with stockpiles of gold or commodities.

Recently a referendum was held in Switzerland about potentially increasing the country’s central bank gold reserves. Most citizens of the Alpine republic rejected the idea that there was a need for such an increase. However, in their comments about the results of the «gold» referendum, many experts pointed out that the respondents did not fully grasp the real question. There are fears that the same could happen with the new referendum.

So once again let’s pinpoint the crux of the matter: this would entail a ban on the creation of fiat money by private banks. The right to issue legal tender should be granted only to the central bank. That bank issues money primarily in the form of banknotes. Commercial banks will turn into financial intermediaries in the traditional sense, which merely draw money into their accounts and then disburse it into the economy in the form of loans and investments. In this manner, real control over monetary circulation will be concentrated in the hands of the central bank. The risks of various types of economic imbalances and crises will drop sharply, because private banks will be stripped of the right to create their own credit funds.

Of course, some problems would inevitably arise during a return to full-reserve banking. For example: what should be done with the huge supply of money that was created by commercial banks? In some countries, the supply of such «gray» money is many times greater than the supply of legal tender issued by the central banks. And this «gray» money can’t just be suddenly erased, because it is fueling the economies of almost every country in the world today. In addition, the proposed Swiss monetary reform is completely at odds with the prevailing trend for not only commercial, but also central banks to increase the money supply. This is happening under the guise of the «quantitative easing» programs pursued by the US Federal Reserve, Bank of England, Bank of Japan, and ECB.

A careful, gradual monetary reform is needed, which will minimize the risk of corporate bankruptcies and sharp rises in unemployment. In addition, one must not forget that any radical monetary reform would deal a blow to the plans of the global financial oligarchs to displace paper money with cashless systems. After all, cashless systems are based on the very same «gray» money that the sponsors of the Swiss referendum are vowing to fight.

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The story of BlackRock, a modest participant at the Bilderberg conference https://www.strategic-culture.org/news/2015/06/18/story-blackrock-modest-participant-bilderberg-conference/ Wed, 17 Jun 2015 20:00:03 +0000 https://strategic-culture.lo/news/2015/06/18/story-blackrock-modest-participant-bilderberg-conference/ When it comes to meetings that determine the trajectory of global development, the first half of June was a busy time. The G7 Summit was held in Bavaria, and the Bilderberg Club conducted its annual meeting next door in Austria on June 14. Many of the participants in that club’s meetings carry more weight than the presidents and prime ministers from the Group of Seven. We know that each year, the presidents and chairmen of the boards of directors of banks and corporations with impressive brand names like JPMorgan, Goldman Sachs, Morgan Stanley, Deutsche Bank, Lizard, Banco Santander, HSBC, Royal Dutch Shell, British Petroleum, Alcoa, Google, etc. all meet as part of that club. Those brands are household names, and there is no denying the economic and political influence these banks and corporations wield all over the world.

But some attendees of Bilderberg Club meetings represent organizations whose names mean little to the public. But that’s not because those organizations are less influential than Goldman Sachs, HSBC, or Royal Dutch Shell. On the contrary, their impact is often even greater, although they avoid the limelight. And that’s true, not only during meetings of the club, but also in everyday life. Organizations like this are rightly known for working «behind the scenes».

In particular, Philipp Hildebrand, a vice chairman at BlackRock, made his appearance as one of the 140 participants at the meeting in Austria. Philipp Hildebrand is a man «widely known in narrow circles». A glance at his track record shows that in the past he has held positions such as IMF director for Switzerland, chairman of the Governing Board of the Swiss National Bank (SNB), director of the Bank for International Settlements (BIS), and so on. And now he is a vice chairman at this little-known organization called BlackRock. But I would suggest that Blackrock’s influence is every bit as significant as JPMorgan, Goldman Sachs, and Morgan Stanley put together. In the past I have written that BlackRock is one of the Big Four – a group of huge financial holding companies that control many sectors of the economy in the US and abroad. Other members of the Big Four also include: the Vanguard Group; State Street Corporation; and FMR Corporation (Fidelity). Here is a brief sketch of BlackRock.

The company’s very name, «black rock», is probably intended to convey an image of strength and solidity. In a recent article titled «The Wars of Wall Street» (May 13, 2015), Russian strategic analyst Elena Larina wrote: «…behind every well-known bank on Wall Street stand even more powerful and unregulated institutions. Those are asset management companies. The biggest and most mysterious of them is the BlackRock corporation headed by Larry Fink. Currently it manages assets – the vast majority of which are stocks – worth more than $4.5 trillion. Just one figure – $36.5 trillion – gives an idea of the extent of the firm’s predominance, and that number is slightly less than the capitalization of this company that is included in the S&P 500, meaning that BlackRock controls a significant part of corporate America».

BlackRock (BR) is an international investment company headquartered in New York (USA). At the end of 2013 it had $4.57 trillion in assets under management. By mid-2014, those assets had grown to $4.77 trillion. Some experts believe that BlackRock controls more assets than any of the other Big Four firms.

BlackRock is the youngest of the Big Four, founded in 1988. It has literally only been in the market for a quarter century, but has soared to heights beyond the reach of other companies. The company has a global presence, with 21 investment centers and 70 offices in 30 countries and with clients in 100 countries.

And unlike the family-owned FMR, BlackRock is a public corporation with shares traded on the stock exchange. The principal owners of BR, if one can trust Wikipedia, are Bank of America (34.1 %), PNC Financial Services (24.6 %), and Barclays PLC (19.9 %). But that information is likely out of date. NASDAQ claims that as of Dec. 31, 2014, BR’s biggest shareholders (share capital, %) were: PNC Financial Services – 20.98; Norges Bank Investment Management – 7.15; Wellington Management Co. – 6.38; FMR – 4.16; Vanguard – 3.89; State Street – 3.43; and BlackRock Institutional Trust Company (BRITC) – 1.98. In additional to institutional investors, mutual funds also hold shares of BlackRock, as is typical. Almost every member of the pantheon of the Big Four is included in the top ten of these funds (six from the coterie of Vanguard, two from FMR, and another two have to be looked at separately).

The biggest institutional shareholder is PNC Financial Services – an American financial company with $345 billion in assets at the end of 2014 and headquartered in Pittsburgh. But when we look at who owns PNC Financial Services, it appears that its five largest institutional investors include three of the Big Four. That would be Vanguard, State Street, and BlackRock Institutional Trust Company (BRITC). The last of these companies is a division of BlackRock – part of its empire.

And the third largest institutional investor – Wellington Management Co. – is very closely linked to another member of the Big Four, the financial company Vanguard. Perhaps the only one of BR’s institutional investors that is relatively independent of the Big Four is the company Norges Bank Investment Management – a specialized division of the Norwegian central bank, which is responsible for investing the Pension Fund of Norway in the financial markets.

Individual shareholders, primarily those who serve as the company’s senior managers, also invest in BlackRock. The five biggest individual investors own shares equal to 1.16% of the company’s capital (as of April 2015).6 The key figures in BlackRock’s management are: Laurence D. Fink – founder, chairman, and CEO; Robert S. Kapito – founder and co-president; Charles Hallac – co-president; and Susan Wagner – founder and member of the board of directors.

It is worth noting that BlackRock has the smallest staff of any of the Big Four companies – numbering only 11,500 (in 2013). That works out to over $400 million in managed assets per BlackRock employee. That figure is beyond the reach of other companies and organizations in the American financial sector.

Like the other Big Four companies, BlackRock owns a capital stake in the leading banks on Wall Street. But the company also has an appetite for European banks. In December 2009, BlackRock purchased Barclays Global Investors for $13.5 billion. As we see, BlackRock has a very intimate relationship with Barclays bank. That bank, by the way, took first place in a ranking created by the Institute of Technology in Zurich. The Rothschild-led Barclays Bank also held some staggering positions during the global financial crisis.

Suffice it to say that in 2007, Barclays was the biggest institutional investor in some key Wall Street banks, such as Bank of America, JP Morgan Chase, Citigroup, and Bank of New York Mellon. Plus, Barclays was the second largest institutional investor in the US bank Wells Fargo. Incidentally, Barclays also held strong positions in many non-US banks. It is worth noting that BlackRock was as a major shareholder in those same banks as well (although not as significant a figure as Barclays). It could also be seen that BlackRock and Barclays seemed to work in tandem, but their codependence was not easy to establish.

It can be difficult to figure out which end is the dog and which end is her tail and who is controlling whom. Is Barclays directing BlackRock or is BlackRock running the bank? But most experts are inclined to believe that it is BlackRock that is dominating the famous Barclays bank, which has always been associated with the Rothschild family. Therefore, a correction can be made to the Swiss rankings, in order to take into account BlackRock’s purchase of Barclays. The Swiss list of top ten companies did not previously include BlackRock, but now it can be added with confidence. If BlackRock assumes Barclays’ place, that will put it right at the top. The company is very influential, publishing the credit ratings of countries all over the world. According to its January 2013 rating, the most creditworthy country is Norway, followed by Singapore, Switzerland, Sweden, and Finland. BlackRock awarded the United States only 15th place.

Of course BlackRock’s interests are not limited to banks. It buys shares in a wide spectrum of industries in different parts of the world. We have talked about how Fidelity owns a 7% stake in the world-famous company Google. And the second largest investor is BlackRock with 5.7%. NASDAQ provides information about the investment activity of several major divisions within the BlackRock financial holding company: BlackRock Group Ltd. (BRG), BlackRock Institutional Trust Company (BRITC); and BlackRock Fund Advisors (BRFA). See table 1.

Table 1.

The investment activities of BlackRock’s financial holding company (as of Dec. 31, 2014)

BlackRock division

The number of companies with shares in the investment portfolio of that BlackRock division

The value of the shares held in that BlackRock division’s investment portfolio (billions of US dollars)

BlackRock Group Ltd. (BRG)

2,882

190.4

BlackRock Institutional Trust Company (BRITC)

3,894

640.7

BlackRock Fund Advisors (BRFA)

3,928

413.0

Source:  nasdaq.comnasdaq.comnasdaq.com.

Let’s take a closer look at BlackRock’s investment priorities based on the example of one of its divisions, BlackRock Fund Advisors (BRFA). These are the first ten positions in BRFA’s investment portfolio (the value of a block of shares as of Dec. 31, 2014 in billions of US dollars): Apple Inc. – 9.26; Microsoft – 5.03; Exxon Mobil – 4.91; Johnson & Johnson – 3.44; General Electric – 3.31; Chevron Corp – 3.11; Wells Fargo – 2.94; Pfizer Inc – 2.91; Berkshire Harthaway Inc – 2.89; and JP Morgan Chase – 2.75.

Here’s a guide to BlackRock’s investments in US banks (table 2). As we see, the financial holding company is involved with all of the Big Six Wall Street banks.

Table 2.

BlackRock’s investments in the Big Six US banks (in billions of US dollars; as of Dec. 31, 2014)

Bank whose shares were purchased by the BlackRock division

BlackRock division

Total

BlackRock Group Ltd. (BRG)

BlackRock Institutional Trust Company (BRITC)

BlackRock Fund Advisors (BRFA)

 

Wells Fargo

2.26

7.01

2.94

12.21

JP Morgan Chase

2.20

6.69

2.75

11.64

Bank of America

1.42

4.54

1.88

7.84

Citigroup

1.56

4.33

1.83

7.72

Goldman Sachs

0.68

2.25

0.96

3.89

Morgan Stanley

0.43

1.53

0.68

2.64

Total

8.55

33.36

11.04

52.95

Source: nasdaq.comnasdaq.comnasdaq.com.

And so, many banks and companies that are represented at the annual meetings of the Bilderberg Club, are, to a greater or lesser extent, dependent on BlackRock. If Philipp Hildebrand spoke at the current conference, then I am sure the other attendees listened to him with particular attention and respect. For this reason, one of the best-informed people in the world, former Fed chairman Paul Volcker, once called BlackRock the most powerful financial corporation in the world.

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Swiss corruption investigators have pronounced their verdict on Ukraine (II) https://www.strategic-culture.org/news/2015/06/12/swiss-corruption-investigators-have-pronounced-their-verdict-ukraine-ii/ Thu, 11 Jun 2015 20:00:03 +0000 https://strategic-culture.lo/news/2015/06/12/swiss-corruption-investigators-have-pronounced-their-verdict-ukraine-ii/ Part I

The experts from the Global Studies Institute of the University of Geneva have issued even more scathing conclusions about how the European Union is affecting events in Ukraine and what that means for the EU. 

According to the Swiss investigators, «The positive effect of the EU integration policies is obviously highly questioned: although it may have worked out in certain countries, it was catastrophic in other countries such as Romania and Bulgaria. However, the EU has always had a stabilizating [sic] role in all of these countries where the tense economical situation in fragile economies could have strongly destabilized the social and political structure in many occasions. We shall also notice that Ukraine can be considered as the second major failure of the EU foreign policy after Yugoslavia because the Union was not able to impede the war». This is because «democracy cannot be ‘imposed’ from outside, and that crime without control can lead an entire geographical zone and a massive population to a disaster of war, hate and cruelty, scratching to the end the fine glaze of civilization humanity has taken over centuries to build».

For that reason, it is possible that «Ukraine might be the ‘nemesis’ of Europe», as a sort of comeuppance for its violation of social and moral standards. And that includes more than just the fears of sharply heightened competition on the European labor market after a possible influx of Ukrainian «guest workers». «As it happened with the integration of the Eastern European countries (including Poland), the massive emigration toward Western Europe countries created huge problems not only in terms of criminality exportation but also in terms of ‘political machine’ and unfair competition in the labor markets».

European qualms are much more serious. They worry that the leaders of Ukraine will take their cue from Georgia’s tactics for fighting organized crime and force Ukrainian underworld groups to shift their operational bases into «the very heart of European institutions» – in other words, colonizing the most prosperous countries in Europe. «However, the situation is more dangerous for Europe than for Ukrainians. Of course, the Ukrainian population is suffering from privations, violence, corruption and arbitrary ruling in the countryside, suburbs etc. But this situation forces many Ukrainians to flee their country to the EU, some of them bringing in their luggages improved criminal activities and know-how. This flow of new criminal [sic] on saturated and organized illegal markets will force the existing criminal groups within the EU to reorganize and share the pie with another actor. If this will lead to an increase of the capacities of the EU organized crime groups (Ukrainians can bring lots of capacities, in weapons, in man work, in corruption schemes and economical crime), there will be also tragedies and killings in local mafia wars throughout the EU».

The Swiss experts also reached an interesting conclusion in regard to the spin that European propaganda puts on events in Ukraine: «The war also exacerbated the ‘media’ and propaganda war. The official media, the internet and the private media, in Ukraine but also in the EU, the US on one side and in Russia on the other side started an image fight, aiming at legitimizing its own position. But the ‘media war’ has had a direct impact on the populations of the EU, because it challenged also the legitimacy of the EU institutions themselves on the matter, their independence, their quality, their capacities to bring to their customers a reliable information with intelligent comments and analysis».

* * *

The authors highlighted their recommendations about how to proceed in Ukraine, because events there are increasingly reminiscent of accounts from the former Yugoslavia. As such, the potential aftermath of the EU’s policy toward Ukraine could be similar to the repercussions suffered in Yugoslavia: The «EU shall not repeat the mistakes made in the Balkans to stop the war and ensure the positions of extremists. We have now more than 15 years of experience to analyze the outcomes of such disastrous policies: widespread corruption, continuous high unemployment, ecological disasters and creation of ‘mafia-states’ or closed extremists communities, booming of any illegal trafficking, hardly developing infrastructures and misery among educated populations».

These findings in regard to Ukraine’s present and future are quite damning, including the verdict on the government: «The current institutions are not efficient at all. They give the impression to hold only because of the war. As we have seen these early days of March 2015, the respect of the Minsk agreements which have effectively seen a withdrawal of the heavy weapons along the ceasefire line have lighted other fires in Kiev almost immediately: polemics, disputes, fights, etc. As it is, the future shows signs to slip over a more autocratic government in order to control the forces that are currently ruling the country (including organized crime groups) and to avoid a total chaos. This will lead or to a soviet-style totalitarism, or to an extreme nationalism. It seems currently, with the help of some EU members, that the path looks more the second than the first option».

Of course Ukraine’s slide into a neo-Nazi state is being given the trappings of various democratic formalities, but those efforts come to naught: «The Ukrainian state legitimacy moves through elections also seems to be ‘medical patches’ to a more deep cancer». And against a backdrop of civil war, «the direct implication of foreign countries such as the EU, Poland, Germany, France, the United States, Israel and Russia in Ukraine’s destiny turns the possible outcomes even more difficult, uncertain and dark».

The conclusions of the study’s authors are even more categorical in regard to the prospects of a unitary Ukraine: «It seems that in a mid-term future, Ukraine will never be in the capacity to be a centralized state. Indeed, the institutions shall leave more space to the regions and create a true federation such as Germany, the US or Switzerland». But they do not feel that even an integrated, federal Ukraine could promise a solution to all the problems: «We believe that future cannot be acceptable for Ukraine. Even if the country shall split in two different countries, the situation and challenges will remain the same: how to ensure a viable prosperity framework for the populations».

However, the question of the country’s future, ravaged by civil war and is now sliding toward fascism, is one that is being determined far outside of Ukraine herself. And the Swiss researchers are not shy about admitting this: «As it was reminded to us in February 2015, ‘the future of Ukraine hardly depends on the Ukrainians.’»

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Swiss corruption investigators have pronounced their verdict on Ukraine (I) https://www.strategic-culture.org/news/2015/06/11/swiss-corruption-investigators-have-pronounced-their-verdict-ukraine-i/ Wed, 10 Jun 2015 20:00:02 +0000 https://strategic-culture.lo/news/2015/06/11/swiss-corruption-investigators-have-pronounced-their-verdict-ukraine-i/ In May 2015, the Global Studies Institute of the University of Geneva published a major study on the state of corruption in Ukraine. They worked on this 180-page document from September 2013 until January 2014, based on material from previous years, and it is in many respects already outdated because of the drastically altered political situation in the country after the overthrow of the government. However, the study’s authors worked hard to identify the reasons why Ukraine has become the utterly corrupt state that it is today, and the investigators also looked into the history of how corrupt ties have developed in Ukrainian society.

As to whether what they have described in their report has any relevance to the situation in today’s Ukraine, the authors are open about their doubts: «We had a long reflection about the pertinence to continue this report among the OCO staff and given the chaotic situation in the country, the large amounts of money, technical and human assistance, that are delivered by western countries to Ukraine, and the current level of corruption, violence and administrative chaos, we reached the conclusion that this report can bring some information that can be useful during this standpoint in time which policy makers, from any country, can rely on for organizing further judicial, political and anticriminal policies and administration».

While comparing the level of corruption in the country before and after the coup, they draw conclusions that are quite shocking to the residents of Ukraine, who have grown accustomed to Europe’s official propaganda: «Public corruption and conflicts of interest have remained a significant problem for Ukraine, then and now. Any party engaging with Ukraine will have to interact with groups that are linked to oligarchic structures. If we observed a trend to a stronger verticalization of power driven by the former President Yanukovitch, the public corruption would have gone completely out of control after the collapse of the former regime». 

The Geneva investigators gave high marks to the steps taken by the «tyrant» and «extortionist» Yanukovych to combat bribery, noting that many of the legislative acts passed during his administration made life much more difficult for Ukrainian grifters, including highly placed officials. The main argument in favor of this position has been, however, the one-sided application of the anti-corruption measures, which have been used primarily against the former president’s political opponents. In the text of the report there is no trace of the usual condemnation of the indictment of former Interior Minister Yuri Lutsenko that is typical in the European press, and the corruption dossier of Yulia Tymochenko was issued as a separate chapter in the Addendum to the document.

The difference between the corruption of public officials under Yanukovych and corruption under Poroshenko, according to the investigators, is that previously, state funds were embezzled using tenders, auctions, tax revenues, and foreign-exchange earnings, while now «the situation has only changed in that the money which now falls into this category does not come from the Ukrainian industries and services anymore, but more and more from foreign help: first it was coming from Russia, now it’s coming from the EU, the US, and the international organizations such as the International Monetary Fund, the World Bank, the EBRD, or the multilateral financial aids». The core of the corruption has increased dramatically due to new trends, «such as corporate raiding and corporate fraud [which] are relatively new developments in the country. The collapse of the institutions from May-June 2014 since now have boosted and diversified the traffics not only in criminalized goods [drugs, weapons, and human trafficking – A. D.] but also in basic consumption goods». 

* * *

The authors of the document believe that groups of oligarchs and influence are the most significant factor in Ukrainian corruption, and also, accordingly, the scope of the corrupt practices, which is predicated on their proximity to the government in power: «The alliance between the oligarchs and the state has become entrenched at the highest levels of government, while at the local level, judges, police, local government officials and politicians have organized themselves into a corrupt network of mutual enrichment at the public expense». Moreover, many of these groups have ties to Soviet and post-Soviet organized crime groups. For example, the investigators take a hard look at the associations between Dmitry Firtash and the organized crime boss Semyon Mogilevich, as well as the links to the criminal activities of former Prime Minister Pavel Lazarenko.

However, the coup d’état and subsequent events have also changed the corrupt connections of Ukrainian oligarchs: «the civil war in the east, and episodically on the south of the country, have now exacerbated the tensions among the oligarchs, some of them seeing the war as an opportunity to seize further assets, redistribute the ‘cards’ by gaining more and more power and control over production tools, i.e. steel, coal, gas, electricity, communication, railways, etc». According to an unnamed NATO official working in Ukraine, currently five oligarchs who «acquire assets on the cheap» are being supported by the central government.

Examples are listed of some opportunities for corruption that have now opened up for the oligarchs and industrialists as a result of the fighting. One example involves providing gasoline for the military, whose needs have grown 150%. After adopting a simplified tender procedure for the army, it became possible to enter into contracts without public bidding. As a result, a company owned by one of the oligarchs charged 50% more for the kerosene it sold to the Ukrainian army, compared to the pre-war price. In May 2014, a company belonging to the same oligarch sold military technology for the army at a huge margin, «and even received the authorization of the Council of the Ministries of Ukraine to import military helmets with a price 16% above the competitors».

Speaking about the Defense Ministry on TV Channel 5, Ukraine’s assistant minister of defense, Yuri Biryukov, was quoted as saying that approximately 20% to 25% of the money intended for defensive needs was being stolen. He said this came to «about 450 million USD stolen from the Ukraine’s military». According to the authors of the study, «every 81 USD out of 100 USD spent was stolen on one defense factory».

* * *

In the battle against corruption, the current government is primarily wagering on specially created public anti-corruption agencies. But even without knowing that the fight against corruption in today’s Ukraine immediately turned into nothing but a new pork barrel for that corruption, the Swiss criticized the very approach that was taken, in which instead of a single authority, two similar agencies – an Anti-Corruption Committee and an Anti-Corruption Bureau – were created. In their view, this only serves to fragment those efforts and introduces discord.

Even more criticism was directed at the lustration program, which was approved under a law adopted by the Ukrainian parliament, because «the lustration in itself does not cope with corruption through any rule of law, but merely applies an extra-judicial political process, which in turns reinforces the dependence of Justice to the political power».

Referring to the decision of the Venice Commission, the authors of the document note that «the lustration law contained some serious flaws; it called for revision of the lustration criteria, administrative decisions on lustration to be postponed, and that information on who is subject to lustration should only be published after a final court ruling was issued». Considering the draft of the law, they noted, «All three drafts are overly broad and vague and may set the stage for unlawful mass arbitrary political exclusion».

The Swiss researchers warn: «The lustration program might prove to be a disaster for Ukraine, especially in the law enforcement sector». The same applies to the judiciary: «Imposing the lustration inside the judicial apparel is a major political mistake». This was explained as follows: «First because it sacks out most of the indispensable professionals needed to ‘run the machine,’ but because it replaces a political allegiance by another one, under the will of building a more independent and corruption-free judicial administration. In fact, it just replaces the older officials with new ones that are submitted to the exact same rules, and everybody knows that the same causes will produce the very same effects».

By and large, the lustration of judicial employees will not produce the desired effect and could even exacerbate the situation: «The old sacked one will have no other possibility to turn even more corrupt if they want to survive economically and socially in a new Ukraine. This will undermine again the legitimacy of the judicial administration and make it even worse than it was before».

(To be continued)

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Never Mind FIFA, How about a Crackdown on the Banksters? https://www.strategic-culture.org/news/2015/06/03/never-mind-fifa-how-about-crackdown-banksters/ Tue, 02 Jun 2015 20:00:02 +0000 https://strategic-culture.lo/news/2015/06/03/never-mind-fifa-how-about-crackdown-banksters/ FIFA boss Sepp Blatter’s sudden resignation this week only days after being re-elected shows that the US campaign to bust the football federation over alleged financial corruption is probably going to intensify during the weeks and months ahead.

Blatter had been re-elected for the fifth time last Friday as the federation’s president. He had earlier brushed off calls for his resignation from the American and British governments, amid a storm of media allegations over corruption at the World Cup organising body. Now only four days after being re-elected, the FIFA chief executive is quitting, saying somewhat cryptically that he does not have a sufficient mandate in the world of football to continue at the helm of the organisation. 

The dramatic bust in a Zurich hotel last week of FIFA executives is «just the beginning», top US law enforcement officials have warned. British authorities have also jumped on the bandwagon with their own announced probe into financial irregularities at the World Cup organiser. 

With seven FIFA officials arrested so far and seven more indicted, and the US authorities vowing to pursue others in the footballing federation over alleged financial corruption, it can be anticipated that this scandal will run and run into interminable extra-time. 

An ulterior political agenda behind the apparent American-led crackdown on the international footballing federation could very well be the desire by US and British governments to scupper the 2018 World Cup venue in Russia. Both the Americans and the British lost out when Russia won the bid back in 2010 to host the forthcoming quadrennial tournament, following last year’s event in Brazil. A re-run of the selection process would give the US and Britain a second chance to pitch their bids, and with a generated cloud hanging over Russia due to the FIFA scandal, they both stand a better chance of winning if it comes to a re-selection. 

The sporting event is highly coveted, being the most popularly watched on the planet – even exceeding the Olympics. Billions of dollars are at stake for corporations, from construction, hospitality, sportswear and media. There is also the immense national prestige that comes with hosting the global spectacle. 

A second, more important, political objective for Washington and its British ally is to augment their ongoing campaign to isolate Moscow over the Ukraine crisis. The West accuses Vladimir Putin’s government of annexing Crimea last year and they have mounted a barrage of economic sanctions on Russia seemingly in retribution. Washington and London have been most gung-ho among Western countries in pushing the anti-Russian agenda over Ukraine. 

President Putin has shown no sign of weakening under this relentless Western pressure. Moscow denies any impropriety over Ukraine. Indeed, it accuses the West of fomenting an illegal coup in that country and of trying to use the resulting conflict as a way to destabilise Russia. Moscow has retaliated to Western sanctions by imposing its own bans on European trade exports and, in recent days, imposing travel restrictions on 89 European Union parliamentarians. 

So, very plausibly, the Americans and their trusty British ally are using the issue of alleged corruption in World Cup organising body, FIFA, as a stalking horse to further get at Russia over the geopolitical tensions in Ukraine. 

US law enforcement officials at the highest level – including attorney-general Loretta Lynch and FBI chief James Comey – say their investigation into FIFA will continue until all suspicions of corruption in the organisation are uncovered. This high-level US involvement in targeting FIFA strongly suggests a political direction being given by the Obama administration. 

The concerted nature of the American corruption onslaught against FIFA also points to a top-level decision to go after the Swiss-based federation. The British government, from prime minister David Cameron to his foreign secretary Philip Hammond, quickly stepped into the FIFA scandal following the American lead, making highly unusual public calls for the federation’s president Sepp Blatter to resign.

Both the timing of the US-launched corruption probe – in the week of FIFA’s annual conference and leadership election – plus the way that senior American and British officials, not to mention the publicity of Western news media, have weighed-in to rebuke FIFA suggests that it is all part of a coordinated political campaign authored at the highest level of government. That, in turn, suggests that there is an ulterior political agenda behind the supposed criminal crackdown on FIFA, and that the ulterior agenda is the Western objective to undermine Russia. 

Another measure for assessing the credibility of the US-led corruption campaign against FIFA is to put the alleged wrongdoing in perspective with other known spheres of financial corruption. Few people believe that FIFA is free from sleaze and dodgy kickbacks. With so much corporate advertising at stake and broadcasting rights for global media audiences, it would be naive to assume that large wads of money have not crossed palms with a wink and a nod. 

The US authorities are throwing a book of charges at the organisation, ranging from bribery to commercial fixing, racketeering to tax evasion. It is claimed by the Americans that the corruption at FIFA amounts to $150 million. 

That sounds like a lot of sleazy money, but this figure pales in significance to the amount of corruption and criminality attributable to Wall Street banks and other Western financial institutions. For example, British bank HSBC alone has been caught running tax evasion, money-laundering for drug cartels and other illicit schemes that is estimated at $180 billion – or more than a thousand-fold the scale of criminality alleged at FIFA.

Wall Street banks, including JP Morgan, are accused of massive, systematic rigging of gold price markets all in a shady bid to shield the US dollar value. That criminality, affecting the price of basic commodities and livelihoods for billions of people worldwide, is estimated to be in the order of trillions of dollars – or a thousand, thousand-fold the FIFA debacle. 

Moreover, these same banks, along with a slew of other global names – Citibank, Bank of America, Goldman Sachs, Barclays, Deutsche Bank, Credit Agricole among many others – were all directly responsible for the explosion in toxic financial derivatives that made their executives multimillionaires but which led to the global financial and economic meltdown in 2008. 

That meltdown – which persists seven years on from its inception – has resulted in millions of lives ruined from unemployment and the collapse of pensions and savings funds. Added to that are the myriad social hardships and crippled lives from the ensuing austerity imposed on the general Western public to pay for the financial catastrophe – a catastrophe that was deliberately and recklessly engineered by the major banks, hedge funds and other capitalist investment agencies. 

As Michel Chossudovsky writes in his co-authored book, The Global Economic Crisis: «The meltdown of financial markets in 2008-2009 was the result of institutionalised fraud and financial manipulation. The ‘bank bailouts’ were implemented on the instruction of Wall Street, leading to the largest transfer of money wealth in recorded history, while simultaneously creating an unsurmountable public debt».

It is probable that generations of children to come will be forced to pay for the trillions of dollars of debt that was created by American and European banks, which have now been offloaded on to the public by governments in so-called «bail-outs». Make no mistake, thousands of people have already died from the austerity that Western governments have imposed on their public in order to pay for the corporate fraud, tax evasion, fixing and embezzlement that has taken place in front of our eyes on a massive scale in the order of trillions of dollars. 

Yet in the face of this gargantuan, genocidal criminality not one board member or executive from the major banks involved in precipitating the global crash has been charged, let alone prosecuted or imprisoned. In fact, the Wall Street banking elite and their counterparts in the City of London are among the main political donors that helped to re-elect Barack Obama and David Cameron. 

The belated focus of American and British authorities on the alleged wrongdoings at FIFA can thus be readily seen as both ludicrous and laughable when we compare that with the absolute dearth of interest by these same authorities in applying law enforcement where it ought to be applied – on the Wall Street and City of London banksters. 

Obviously, then, the self-righteous campaign to «root out fraud at FIFA is just so much pious nonsense. The astounding hypocrisy of US and British authorities leaves one with the unmistakable conclusion that the whole media-driven campaign against FIFA is nothing but a self-serving and cynical political agenda. And top of that agenda is to score geopolitical points against Russia. 

Until Washington and London governments go after priority financial crime in their midst, then anything they say about FIFA can be taken as very wide off the mark. 

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US Cries FIFA Foul to Penalise Russia https://www.strategic-culture.org/news/2015/05/28/us-cries-fifa-foul-to-penalise-russia/ Thu, 28 May 2015 16:08:14 +0000 https://strategic-culture.lo/news/2015/05/28/us-cries-fifa-foul-to-penalise-russia/ The saying goes: don’t mix politics and sport. That is exactly what the United States’ authorities seem to be doing over this week’s dramatic arrests of World Cup officials and allegations of rampant fraud amounting to $150 million.
 
The ostensible American concern is to clean up the tarnished image of the «beautiful game» in a global sting operation, which saw the arrest of seven senior members belonging to FIFA – the international federation that organises the quadrennial soccer World Cup finals.
 
But the real goal of the full-frontal assault on FIFA, which involved dawn raids at a five-star hotel in Swiss city Zurich, seems more to do with American political purpose to damage Russia’s World Cup plans. That objective has to be seen in the context of Washington’s aim to isolate and destabilise Moscow in an ongoing geopolitical battle that is currently centred on Ukraine. 
 
Russia is to host the world’s biggest sporting tournament in 2018. The event carries huge prestige for the host country giving an enviable spotlight for millions of television viewers around the world to showcase modern infrastructure and national prowess. There is also the inestimable «soft power» that comes with consolidating friendly international relations by welcoming football teams and fans from over 30 nations. Russia already availed of such benefits in its successful hosting of the 2014 Winter Olympics in Sochi, which Western leaders sought then to spoil by boycotting that event over unconvincing human rights concerns. 
 
Russia’s World Cup plans appear to be now similarly targeted for an ulterior political agenda. Within hours of the US-launched arrests of FIFA officials in Zurich, the football federation was obliged to state that the forthcoming World Cup in Russia was not in jeopardy of cancellation over related claims of wrongdoing in the selection of that venue. 
 
Russian officials also moved to quash any suggestions that the 2018 finals would be disrupted by the ongoing US-led probe into alleged FIFA fraud. 
 
«I see no threat to Russia or any problems», said Vitaly Mutko, the Russian sports minister, according to a New York Times report.
 
Russian foreign ministry spokesman Alexander Lukashevich alluded to the political dimensions of the American investigation, referring to the FIFA arrests as «another case of illegal extraterritorial application of US laws», adding: «We hope this will in no way be used to tarnish the international football organisation in general and its decisions». The latter point is no doubt a reference to FIFA’s selection of Russia as the host nation for the 2018 tournament.
 
Suspicions that there is much more to the US investigation into FIFA affairs are aroused by the unmistakable sense of political orchestration behind the high-profile move by American law enforcement officials this week. 
 
Accompanying Western media glare across all the major news channels, as well as well-honed soundbites, pointed to a politically engineered «story».
 
Even the Washington Post, among other Western outlets, remarked on the «colourful details» disclosed by US officials in bringing dozens of indictments against FIFA figures, ranging from bribery, tax evasion, money-laundering and racketeering. The crackdown, carried out with the collaboration of Swiss police, was conducted in the style of a sting operation more often seen being deployed against organised crime syndicates. The melodrama had the air of a politically driven media campaign for maximum publicity.
 
While FIFA executives were being bundled into Swiss police cars, their heads covered under white hotel bedsheets, the highest ranking US law enforcement authorities were coordinating across the Atlantic in a full-court press conference.
 
«The beautiful game was hijacked», said FBI director James Comey in emotive tones about a sport not usually associated with high-level American interest. The FBI chief added: «The defendants fostered a culture of corruption and greed that created an uneven playing field for the biggest sport in the world. Undisclosed and illegal payments, kickbacks and bribes became a way of doing business at FIFA».
 
Richard Weber, the criminal investigation chief at the US Internal Revenue Service, described the alleged wrongdoings at Swiss-based FIFA as the «World Cup of fraud» and added «we are showing FIFA the red card». The Washington Post, reporting on the press conference, made the telling comment on how «officials seem to vie for the best soundbite».
 
Also speaking at the high-profile US press conference was attorney general Loretta Lynch. She lambasted FIFA over «rampant, systemic and deep-rooted corruption». Lynch said: «They [FIFA] were expected to uphold the rules that keep soccer honest. Instead they corrupted the business of worldwide soccer to serve their interests and enrich themselves». She also tugged on public heart-strings by claiming that FIFA embezzlement had deprived millions of children in poor countries of sporting facilities. 
 
A report in Britain’s Guardian newspaper said of the «dramatic, unprecedented» American probe that it «represents a political decision that an international sport that has captivated a generation of US players should no longer be seen as above the law».
 
The Guardian gets it half-right. It certainly smacks of a political decision, but the real motive, naively misplaced by the Guardian, has little to do with American authorities stamping out corruption in sporting finances.
 
In a more realistic admission of the bigger geopolitical picture in regard to the FIFA scandal, the New York Times noted that «the United States and its European allies have sought to isolate Russia with sanctions after its annexation [sic] of Crimea in 2014 and the conflict in southeast Ukraine. The World Cup has taken on added significance for Russians intent on projecting their international standing», added the New York Times with perhaps an unintended acknowledgement of the ulterior political agenda at work.
 
Another indication of the political origins of the latest crackdown on FIFA is that the US legal case relies on evidence provided by former American soccer executive Chuck Blazer. Blazer was facing a long prison sentence in the US for alleged tax evasion before he turned FBI informer in a plea bargain. It is information purportedly gleaned from Blazer that has reportedly propelled the US-led arrests of the FIFA executives this week.
 
Allegations of corruption and commercial fixing have dogged FIFA officials for many years, from at least since the early 1990s, including allegations against the federation’s five-time elected president, Swiss national 79-year-old Sepp Blatter. There have been suspicions that FIFA’s selection of South Africa as the 2010 World Cup host was marred by bribery involving $10 million. Similar allegations have been made over the 2018 finals in Russia and the proceeding tournament in 2022 to be held in the Persian Gulf gas-rich sheikhdom of Qatar. One source of such allegations against Russia and Qatar is the London Times, a long-time purveyor of Western disinformation.
 
Whatever the truth about the corruption allegations at FIFA, it seems plausible that the sudden and strenuous criminal probe launched by the US authorities is intended to undermine Russia’s World Cup ambitions and, by extension, the Russian government’s global standing. US officials warned this week that their investigation into FIFA is «just the beginning» and that it will continue until it gets to the bottom of corruption claims. That suggests the convenient setting up of a long campaign that will further discredit FIFA and its associated World Cup spectacle – with Russia, as the next venue for the event, likely to be embroiled in the US-intended climate of scandal and smear. 
 
Earlier this year, the US-backed Kiev regime that took over Ukraine in an illegal coup in February 2014, called for an international boycott of the World Cup in Russia. That notion floated by Kiev President Petro Poroshenko seemed at the time like another ludicrous announcement from the Western-backed regime in its hysterical claims against Russia. Now it appears the idea has gained the full backing of Washington under the guise of a contrived, high-profile corruption probe against FIFA. 
 
It might also be noted that the undeclared Western hybrid war against Russia in Ukraine is running out of steam, with the political objective of sanctioning and destabilising Moscow failing. In particular long-running US allegations of Russian state subversion in eastern Ukraine are increasingly becoming threadbare and lacking in credibility.
 
A report this week from Reuters was headlined with the breathless words: ‘Exclusive: Russia masses heavy firepower on border with Ukraine – witness’.
 
The Western news agency, which has been caught previously fabricating anti-Russian claims over the downed Malaysian civilian airliner last July, reported thus: «Russia’s army is massing troops and hundreds of pieces of weaponry including mobile rocket launchers, tanks and artillery at a makeshift base near the border with Ukraine, a Reuters reporter saw this week».
 
Such disinformation impact the Western public over alleged Russian malevolence in Ukraine is by now suffering from a diminishing «overdose» response. To be blunt, US claims of Russian aggression and expansionism are sounding increasingly hollow and hackneyed.
 
US secretary of state John Kerry’s «respectful» attendance at a World War Two memorial in Russia’s Sochi earlier this month, along with his Russian counterpart Sergei Lavrov, may have suggested that Washington was paring back its covert aggression toward Moscow in a tacit admission of failure on that front. 
 
However, having not been able to gain much traction from hybrid war against Russian interests in Ukraine, it appears that Washington is shifting tactical gears in its regime-change objectives against Vladimir Putin’s government. Spoiling Russia’s World Cup plans will endeavour to hit Moscow with heavy economic costs, as well as to undermine the country’s global reputation. 
 
But the US-instigated corruption probe at FIFA is, in footballing terms, more like a shabby dive by the Americans with the real aim being to penalise Russia. It’s a risky tactic that may well backfire on Team America.
 
It’s also a sign of how low Washington will stoop when it is using «a beautiful game» much loved by millions of people the world over in order to score its ugly political objectives against Russia.
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Swiss, French call to bring home gold reserves as Dutch move 122 tons out of US https://www.strategic-culture.org/news/2014/11/28/swiss-french-call-bring-home-gold-reserves-dutch-move-122-tons-out-us/ Fri, 28 Nov 2014 09:11:57 +0000 https://strategic-culture.lo/news/2014/11/28/swiss-french-call-bring-home-gold-reserves-dutch-move-122-tons-out-us/ The financial crisis in Europe is prompting some nations to repatriate their gold reserves to national vaults. The Netherlands has moved $5 billion worth of gold from New York, and some are calling for similar action from France, Switzerland, and Germany.

An unmatched pace of money printing by major central banks has boosted concerns in European countries over the safety of their gold reserves abroad.

The Dutch central bank – De Nederlandsche Bank – was one of the latest to make the move. The bank announced last Friday that it moved a fifth of its total 612.5-metric-ton gold reserve from New York to Amsterdam earlier in November.

It was done in an effort to redistribute the gold stock in “a more balanced way,” and to boost public confidence, the bank explained.

“With this adjustment the Dutch Central Bank joins other banks that are keeping a larger share of their gold supply in their own country,” the bank said in a statement. “In addition to a more balanced division of the gold reserves…this may also contribute to a positive confidence effect with the public.”

Dutch gold reserves are now divided as follows: 31 percent in Amsterdam, 31 percent in New York, 20 percent in Ottawa, Canada and 18 percent in London.

Meanwhile, Switzerland has organized the ‘Save Our Swiss Gold’ referendum, which is taking place on November 30. If passed, it would force the Swiss National Bank to convert a fifth of its assets into gold and repatriate all of its reserves from vaults in the UK and Canada.

“The Swiss initiative is merely part of an increasing global scramble towards gold and away from the endless printing of money. Huge movements of gold are going on right now,” Koos Jansen, an Amsterdam-based gold analyst for the Singaporean precious metal dealer BullionStar, told the Guardian.

France has also recently joined in on the trend, with the leader of the far-right National Front party Marine Le Pen calling on the central bank to repatriate the country’s gold reserves.

In an open letter to the governor of the Banque de France, Christian Noyer, Le Pen also demanded an audit of 2,435 tons of physical gold inventory.

Germany tried and failed to adopt a similar path in early 2013 by announcing a plan to repatriate some of its gold reserves back from the US and France.

The efforts fizzled out this summer, when it was announced that Germany decided to leave $635 billion worth of gold in US vaults.

Germany only keeps about a third of its gold at home. Forty-five percent is held in New York, 13 percent in London, 11 percent in Paris, and only 31 percent in the Bundesbank in Frankfurt.

RT

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Paul Craig Roberts: Swiss Gold Referendum: What It Really Means https://www.strategic-culture.org/news/2014/11/24/paul-craig-roberts-swiss-gold-referendum-what-it-really-means/ Mon, 24 Nov 2014 18:45:53 +0000 https://strategic-culture.lo/news/2014/11/24/paul-craig-roberts-swiss-gold-referendum-what-it-really-means/ In a few days the Swiss people will go to the polls to decide whether the Swiss central bank is to be required to hold 20% of its reserves in the form of gold. Polls show that the gold requirement is favored by the less well off and opposed by wealthy Swiss invested in stocks. These poll results provide new insight into the real reason for Quantitative Easing by the Federal Reserve and European Central Bank.
 
First, let’s examine the reasons for these class-based poll results. The view in Switzerland is that a gold backed Swiss franc would be more valuable, and a more valuable franc would increase the purchasing power of wage earners, thus reducing their living costs. For the wealthy stock owners, a stronger franc would reduce Swiss exports, and less exports would reduce stock prices and the wealth of the wealthy.
 
The vote is clearly a vote about income shares between the rich and the poor. The Swiss establishment opposes the gold-backed franc, as does Washington.
 
A few years ago the Swiss government, after experiencing a strong rise in the exchange value of the Swiss franc as a result of dollar and euro inflows seeking safety in the Swiss franc, decided to expand the Swiss money supply in line with the foreign currency inflows in order to stop the rise of the franc. The liquidity supplied by the central bank creating new francs has stopped the rise of the franc and supports exports and stock prices. As a vote in favor of a gold backed franc is not in the interest of the elite, it is unclear that the vote will be honest.
 
What does this tell us about the Federal Reserve’s policy of Quantitative Easing, which is an euphemism for printing an enormous amount of new dollars?
 
The official reason for QE is the Keynesian Phillips Curve claim that economic growth requires mild inflation of 2-3%. This false theory was put to death by the supply-side policy of the Reagan administration, but the misrepresentation of the Reagan administration’s policy by the Establishment has kept the bogus Phillips curve theory alive.
 
The claim based in disproven Phillips Curve theory that the Fed’s policy is directed at helping the overall economy is another example of the deception practiced by US authorities. The real purpose of QE is to drive up the wealth and income of the one percent by providing the liquidity that flows into financial asset prices such as stocks and bonds.
 
Since the 2008 US recession, skeptics of the Fed’s explanation of QE as support for the US economy have stressed instead that the purpose of US economic policy has been to support the federal deficit at low interest rate costs and to support the balance sheets of the troubled banks by pushing up the prices of debt-related derivatives on the banks balance sheets.
 
These have been important purposes, but it now appears that the main purpose has been to make the rich richer. This is why we have a stock market whose high values are not based in fundamentals but, instead, are based on the outpouring of liquidity by the Federal Reserve. As the economic policy of the US is entirely in the hands of the rich, it is not surprising that the rich use it to enrich themselves at the expense of everyone else. The Fed’s monetary policy that enriches the rich by driving up the prices of stocks and bonds also has robbed retirees of hundreds of billions of dollars, perhaps trillions, in lost interest income on their savings. http://www.lewrockwell.com/2014/11/bill-sardi/how-10000-in-a-bank-in-2008/
 
As Nomi Prins and Pam Martens have made clear, QE is not over. The Fed is rolling over its interest and principal payments on its $4.5 trillion bond inventory into new bond purchases, and the banks now infused with $2.6 trillion in cash from the Fed are purchasing the bonds in place of the Fed’s QE purchases.
 
According to the latest news reports, Mario Draghi, the head of the European Central Bank will print all the money necessary to support financial asset prices. http://www.marketwatch.com/story/draghi-says-ecb-will-do-what-it-must-on-asset-buying-to-lift-inflation-2014-11-21?dist=beforebell Draghi, like the Federal Reserve, masks his policy of enriching the rich in Phillips curve terms of driving up inflation in order to support economic growth. Of course, the real purpose is to drive up stock prices.
 
Like the Fed, the ECB pretends that the money it prints flows into the economy. But given the poor condition of the banks and potential borrowers, loan volume is low. Instead the money created by central banks flows into paper financial asset prices. Thus, the monetary policy of the Western world is directed toward supporting the wealth of the rich and worsening the inequality in the distribution of income and wealth.
 
The rich are far from finished with their pillage. In exchange for campaign donations, state governors are turning over state pension funds to the management of high-fee, high-risk private pension fund managers who do a better job of maximizing their fee income than protecting the nest eggs of retirees. http://www.informationclearinghouse.info/article40287.htm
 
Throughout the Western world economic policy is run for the sole benefit of the one percent and at the cost of everyone else. The greed and stupidity of the rich are creating ideal conditions for violent revolution. Karl Marx might yet triumph.
 
Paul Craig Roberts, paulcraigroberts.org
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