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NITA: The Disorder of George Bush’s New World

Sanders Research Associates
Where common sense meets economics

Not Important? Think Again
5 September 2002

The Disorder of George Bush’s New World


Flirting with the Unions

President Bush continues to court organised labour. His focus on Pennsylvania is interesting for several reasons. It is Tom Ridge’s turf. Ridge has gone from the governor’s mansion of Pennsylvania to the Department of Homeland Security. Along the way he has brought James Hoffa Jr., leader of the United Brotherhood of Teamsters (in some circles a.k.a. the Mob). It is Ridge, oddly, who has involved himself on behalf of the administration in the dockworkers’ dispute on the West coast.


Consumer confidence crumbles with democracy

The president and his party ought to be worried about the November elections. US consumer surveys continue to erode. Ominously, the gap that opened earlier this year between their negative perception of the economy and the more positive view of their personal financial prospects appears to resolving in favour of more negative expectations about both.

The conventional explanation for this is that the lacklustre job market and a generally moribund economy are to blame. That may be so, but we find it difficult to believe that this is the whole picture. The American government has attacked its own Bill of Rights with a vigour and determination unprecedented even in wartime, and especially in today’s ersatz war. There can be no better indication of just how serious this is than the fact that even the Economist is writing about it. When the self-styled “cadres” of the New World Order begin to worry about freedom, it can only be because they are worried about their own. And well they should be. The government now claims the power to define criminals before they commit a crime. Many people thought it a joke when an Austrian corporal achieved total power in one of the world’s most developed and civilised nations. Many today think it a joke that a mentally challenged rich kid is at the helm of another developed and civilised nation.


Every Putsch needs an excuse…

and 911 is the excuse for this one. The use of Hollywood for propaganda purposes and narrowly defined political objectives was inserted into the public’s consciousness several years ago by the film Wag the Dog. This was, unfortunately, a case of art imitating life. On Sunday September 2, the BBC aired a documentary on 911 that was truly laughable for its maudlin characterisations and its utter evasion of any hard questions. Two fighter pilots scripted right out of Top Gun appeared regularly during the program to give emotional accounts of what it was like to watch the two trade centre buildings crumble. Apart from the obvious, their presence on the program served the purpose of diverting attention away from the central question as to why the military did not react in time to any of the attacks made on that day. The question “Who stood down?” was unsurprisingly never asked, but the excuses were revealing. The North American Space Defense Command opened its bunker at Cheyenne Mountain in Colorado to the BBC filmmakers. There the official line was that there was no timely military response on September 11 because they couldn’t monitor domestic air traffic effectively. Anyone who believes this is truly credulous. I visited Cheyenne Mountain in 1996 as part of a group of individuals from whom the Air Force was lobbying for money. It was an unforgettable experience, and they weren’t saying that they couldn’t track air traffic.


As confidence falls, so does support for war with Iraq

The administration may end up getting the worst of all outcomes. Support for war with Iraq, even from the American public, is dropping fast. The saturation of the print and broadcast media with the 911 attacks as we approach the anniversary of that sad day may well prove to be one wag too much for the dog.

The German Marshall Fund of the United States and the Chicago Council on Foreign Relations sponsored a broad trans-Atlantic survey of public opinion on the conduct of the War on Terror. What strikes us in looking at the results is the virtual absence of support for war as the Bush administration is conducting it on either side of the Atlantic. Fair minded people everywhere do not begrudge the US its right to self-defence. On the other hand, they don’t think that the US should just attack anyone or anyplace it wishes when it wishes without some sort of process. Such as, for instance, proof stronger than a pointing finger that the party attacked has actually committed an act of war.


Watch what they do, not what they say

America’s track record in such matters is not exactly beyond criticism. We have called attention before to the Tonkin Gulf incident that provided the pretext for the intervention in Vietnam. It did not occur, if it occurred at all, the way the military claimed it did at the time.

Although this may seem incredible, it really isn’t in the context of American military thinking of the day. In March 1962 the Joint Chiefs of Staff published a plan called Operation Northwoods the intent of which was to create a pretext for an invasion of Cuba by the regular American armed forces. One section from the .pdf of the declassified document contained in the link below is intriguing and worth abstracting here:

An aircraft at Eglin AFB (air force base) would be painted an numbered as an exact duplicate for a civil registered aircraft belonging to a CIA proprietary…the duplicate would be substituted for the actual civil aircraft…(the) actual aircraft would be converted to a drone…when over Cuba the drone will being (sic) transmitting …a “MAY DAY” message stating he is under attack by Cuban aircraft. The transmission will be interrupted by destruction of the aircraft which will be triggered by a radio signal. This will allow ICAO radio stations in the Western Hemisphere to tell the US what has happened to the aircraft instead of the US trying to “sell” the incident.

Interesting, is it not? Considering that the Commander in Chief made his fortune manipulating stock at Harken Energy, that the Vice President condoned fraudulent pricing at his firm, Halliburton, and that the Secretary of the Army was a senior executive of Enron, (we could go on, but the list is so long, especially when one looks at the Iran-contra era connections) we are amazed at the credibility accorded their assertions about Al Qaeda and Iraq. Clearly there is a powerful urge to believe operative here. They might fool the FBI, but even a hotel flatfoot should be able to see through this.


Will cooler heads prevail?

It seems apparent that the reason that the US refuses to go to the UN for approval for an invasion is because the UN would not approve of it. It seems equally apparent that the reason why it would not be approved is precisely because the US cannot prove any of its assertions. There is no link to 911 and there is no evidence of nuclear weapons. The United States is isolating itself fearfully, as Zbigniew Brezinski points out below, and in so doing is allowing its foreign policy and freedom of manoeuvre to be hijacked by states whose goals are very different.


Lord Alan of Wall Street

Our August break was not all spent pondering weighty issues such as war, equity prices, or foreign currencies. This summer has had more than its share of comic relief, such as the knighting of Alan Greenspan. While his services to the world were cited in explanation, we are inclined to think it more likely that it was his services to the value of Her Majesty’s investment portfolio that were being rewarded. Not long after, Greenspan defended the Fed’s performance during the bubble mania of the late ‘90s and 2000. You can’t see a bubble except with hindsight quoth Sir Alan, and he hadn’t a lance to prick it with. As Paul Krugman points out, you can, he did, and he could have raised bank reserve requirements. Indeed, Krugman quotes Sir Alan himself from the minutes of the FOMC in September 1996:

- “I recognise that there is a stock market bubble problem at this point.”

- ”We do have the possibility of …increasing margin requirements. I guarantee that if you want to get rid of the bubble whatever it is, that will do it.”

Too bad the Fed publishes those damn minutes.


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