Newsnotes 2009 09

Notes On The News

by Gwydion M Williams

Afghan Contested Election Produces Chaos: US very surprised

Land of the Sick and Free [US Healthcare (Obamacare)]

Madoff and Mad Finance [Financial Fraud]


Afghan Contested Election Produces Chaos: US very surprised

Democracy is a system whereby the second-placed party or candidate alleges fraud and tries to organise a riot to overturn the result. This is the USA’s grand achievement since the end of the Cold War – cheat rather than accept electoral wins by people they don’t like. And then they show utter astonishment when this pattern of abuse gets out of control.

I’ve commented before that the USA’s sponsorship of ‘Colour Revolutions’ had established it as normal for the main losers of any election allege fraud. I had not supposed that people who were part of the US-created state structures would be fool enough to make a fuss in Afghanistan, where a complete collapse into chaos is always likely. Where the main usefulness of the election would have been propaganda, convincing an increasingly unhappy US and British public that it was worth carrying on.

It’s always been absurd that foreign troops are needed on a regular basis in Afghanistan, a country where most adult males are warriors. And where armies of occupation inevitably fail in the long run. Something that the Afghans themselves aren’t ready to fight for has no future.

Contested elections are not the same thing as democracy. Contested elections for the top levels of the state generally produce chaos, unless there are solid political parties that can take the long view. In Afghanistan, some people believed it enough to take risks to vote and maybe suffer for it. Yet the process is looking like a farce. For disappointed candidates to dispute the election was foolish, but these are fools.

At the time of writing, Hamid Karzai has officially won 46% of the vote and Abdullah Abdullah 31%. Both men initially claimed an outright win. There’s a suspicion that the figures were initially massaged up in the hope of giving Karzai an outright victory. Then massaged down again when it became clear that Abdullah Abdullah would not accept this. Of course it did distract attention from the extremely low turnout.

It’s also been said that the USA favours Abdullah Abdullah and Ashraf Ghani, the fourth-placed candidate. Another candidate called Ramazan Bashardost, currently running 3rd at 13%, is claiming that those two were boosted in polls of Afghans by some US outfit called the International Republican Institute. His own candidacy was supposedly ignored while Abdullah and Ghani were presented as the main alternatives to Karzai. [A]

The details aren’t that important. What’s clear is that it is a mess, a pointless stirring-up of antagonisms in a political structure that was already weak and corrupt. The appearance of a clean election would have helped. What’s happened so far has already done vast damage to the Western public’s belief that the Afghan War is worth fighting. There have been complaints about British troops lacking the right equipment, especially helicopters. But the real problem is not so much a lack of helicopters as a lack of useful Afghans.

The US intervention destroyed but could not create. It has sponsored a useless government, corrupt and factional. The drive into the rebellious province of Helmand made the government even less popular, because towns were destroyed and civilians hit. Modified tactics were then tried, being more political and less military. But without a sound political structure to build on, this is very unlikely to work:

“The military did its bit, taking the town with minimal civilian casualties. But even with President Hamid Karzai kept informed and large subsidies available, the civilian agencies, including Britain’s foreign office and development department, and the Afghan government came nowhere near to doing their part. Promised aid arrived at a trickle and the Afghan military provided too few troops. As Mackay would later reflect, a counterinsurgency campaign could separate insurgents from the population only with unity of military and civilian effort. But this was hardly an easy task with a mostly illiterate Afghan bureaucracy, and with little money trickling down to make people believe the Afghan government was a force for good…

“The hasty US decision after 9/11 to make most former Taliban leaders into wanted men prevented many from retiring, or switching sides. Instead they were driven into Pakistan, where they regrouped and forged closer ties to the remnants of al Qaeda. US counterterrorist efforts made matters worse, as special forces swept across Afghanistan in the next few years, time and again haplessly being used to settle tribal scores…

“By 2006, the growth in the opium trade, especially in Helmand, had led to what Semple described as ‘nothing short of an attempt to corner the world supply of heroin.’ When the British army arrived it was at worst ignorant and at best naïve about the way its mission was seen locally as securing the interest of one drug lord against another.” [C]

“Parts of the Afghan state do function, and there have been improvements in service delivery – for example, in health and education. But see it through Afghan eyes: a whole generation has watched as the US engineered or connived in the empowerment of the same warlords, commanders and criminals who tore their country apart. Various Afghans have recently told me that those who attacked and stole from them, and destroyed their villages, are now in power.” [D]

With hindsight, I’d say that the main error was made much earlier. The West’s approach was dominated by the ignorant New Right belief that their own patterns of social organisation are ‘natural’ and would automatically spring into existence if bad systems of authority were removed. Even those who oppose particular policies tend to have accepted the overall framework of thought. But what they’re learning in Afghanistan is that modern thinking in general is anything but natural. It had to be painfully evolved over centuries and with the power of a vast state machine imposing it. No state machine ever operated in Afghanistan for very long, and so the basics are missing.

Most of what existed in Afghansitan by way of modern and progressive opinion got entangled with the Soviet invasion and no longer counts. The USA had a ‘window of opportunity’ while the left-wing Najibullah government was there and maybe open to a deal with the West. The last Soviet troops left in February 1989 and Najibullah hung on till April 1992. Towards the end he was open to almost any deal. But as in Iraq, the West thought that an effective but compliant government would spontaneously assemble itself if they destroyed the existing forms.

The fall of Najibullah was followed by complete chaos, warlords unable to create any sort of stable order. The Taliban arose from a natural disgust at this chaos, though Pakistani Intelligence certainly played a role. When the USA invaded in 2001, they simply tipped the balance back towards the warlords, without in any sense changing their nature. They could possibly have created some functional authoritarian regime, accepting that it would take many years and much social transformation before any other sort of regime would work. But instead they insisted that Western forms would work fine given just a little time. This notion will probably be retained until the whole thing collapses.

What the Taliban ought to do is distribute the well-known picture of the USA fleeing South Vietnam from the roof of their own embassy back in 1975. Abandoning most of those who’d trusted in them, after stubbornly refusing all compromise in the preceding months and years. In real terms, they lost that war when they backed the overthrow of Ngo Dinh Diem back in 1964. The Vietnamese Communists were amazed that they had been so foolish, supposedly saying:

“Diem was one of the strongest individuals resisting the people and Communism. Everything that could be done in an attempt to crush the revolution was carried out by Diem. Diem was one of the most competent lackeys of the U.S. imperialists… Among the anti-Communists in South Vietnam or exiled in other countries, no one has sufficient political assets and abilities to cause others to obey.” [B]

In Iraq, Saddam Hussein was the main hope of a Westernised Iraq. Removing his repressive regime led to a revival of the things he’d been repressing, Kurdish sectionalism, religious authority, superstition, hatred of non-Muslims and the sectarian split between Sunni Arabs and Shia Arabs. Unlike Afghanistan, there were many elements of a modern way of life, a viewpoint imposed first by the Ottoman Empire, then by an Arab monarchy that took orders from the British Empire, and finally by various secular regimes, with Saddam’s being the longest lasting and most effective. So several years of intervention have led to the appearance of a modern political order, only even that is not real. Once the USA has properly withdrawn, I’d expect it to break down quite quickly into factionalism and civil war.

Once Iraq has visibly failed, how can anyone suppose that it is worth the West handing on in Afghanistan?


Land of the Sick and Free [US Healthcare (Obamacare)]

Ordinary US citizens are gullible dopes. Reagan’s election marked the start of a massive re-polarisation of the society, with ordinary unskilled workers doing worse and worse. It was cheaper to import immigrants – many of them with the sort of education and skills that the US poor mostly lacked and mostly saw no need to acquire. Yet Reagan changed US politics and it shows no signs of changing back.

Democracy means power to the people. Democracy was in some cases advanced by contested elections in which most people voted. This finished off traditional conservatism, but right-wingers found ways to manipulate it. The vague wishes of the majority don’t translate into anything very useful, not without a coherent and effective organisation. When there is no limit on electoral spending, politicians can be kept obedient to business interests, the source of ready cash. When the media are privately owned, all sorts of rubbish can be circulated and be believed.

This has applied very strongly in the case of Obama’s proposed reform of health care. The USA spends twice as much on healthcare as most advanced nations, and yet has a higher death rate. You can’t get decent health care without private insurance, but most of this is limited so that anyone unlucky enough to have an expensive illness gets ruined by it, even if they were well off. It is also wasteful, throwing masses of expensive and doubtful healthcare at anyone whose insurance will pay for it. Fixing this has long been needed, Bill Clinton tried and failed. Obama now may also fail, thanks to the mass of lies being told:

“Do Americans believe controversial assertions about health care reform including death panels, threats to Medicare, abortions, illegal immigrants and other claims which the White House administrators have labelled as untrue ‘myths?’

“Findings from a new national survey of Americans by researchers from Indiana University Center for Health Policy and Professionalism Research (CHPPR) and the Indiana University Center for Bioethics says that Americans do believe the ‘myths’ about health care reform, confirming that the White House may indeed be losing this battle.”[E]

It is part of a wider pattern. The New Deal worked because it could be seen as a conservative measure, sacrificing some traditional rights in return for keeping the society in being. Under this cover, a lot of practical left-wing reforms were made. But the left-liberal changes of the 1970s were done differently, mostly by relying on the courts to put absurd meaning on hazy language in the constitution in order to impose the same changes that were achieved by elected governments or through referendums in Western Europe. The US public, already rather remote from European values in the 1960s, reacted to this by becoming suspicious of government in general:

“Some of the protesters, particularly the elderly, who already benefit from government largesse under Medicare, are worried about what will happen to their benefits. But by far the largest chunk know little about the proposed reforms and have no intention of rectifying their ignorance.

“More than a generation ago, the great American historian, Richard Hofstadter, wrote the classic The Paranoid Style in American Politics. Having watched many public servants and colleagues in academia hounded out of their jobs on the flimsiest of pretexts during the ‘red scare’ of the McCarthy era in the 1950s, Hofstadter identified what he saw as a peculiarly American pathology of proneness to conspiracy theory.

“America, he pointed out, was a relatively rootless society, which meant that anyone suffering from economic or status anxiety, particularly its struggling white middle classes, was particularly susceptible to the politics of scapegoating. Although also exhibited on the American left – think of the indefatigable Noam Chomsky, who sees a conspiracy under every rock, or Ralph Nader, the former consumer activist who believes corporations run everything – Hofstadter saw the paranoid style mostly as a right-wing phenomenon.

“His theory holds up very well in 2009. Anyone who visits a few of this month’s rowdy town hall meetings can grasp that opposition to Mr Obama’s healthcare proposals is a lightning rod to a far larger world view, which seeks to protect American values and the US constitution from an alien takeover.” [F]

The paranoia has cause – the failure of the USA to maintain its original ideal of small independent production. Also from a set of false beliefs held by most of the society: that the US Constitution contains a set of uniquely fine guarantees for civilised life, and that small independent production will flourish if left alone without government regulation.

A recent article in The Guardian compares present poverty in California to what was there in the 1930s. Then “the poor looked to President Franklin Roosevelt as a shield from the excesses of capitalism and his New Deal to alleviate the worst hardship. Today, from Oklahoma to California, there is suspicion and outright hostility with even some of those who arguably have most to gain from liberal policies and social programmes speaking of all government as if it is the enemy.” [D]

Of course Roosevelt did little to change existing cultural values, including racism. He needed the votes of southern Democrats to get his social program through. Liberal reform stalled in the USA when the Northern Democrats were forced to take their principles seriously and take coherent steps to end official discrimination.

The 1960s also saw the first major open revolt against the society’s official Christian values. It may not have an official religion, but all of the assumptions are based on Latin-Christian practice, including most of the public holidays and the view that Sunday is a day of rest. That is resented by the poor, who still see themselves as being in a world run directly by God and in which the state is an unwelcome intrusion:

“Banes said she doesn’t have confidence in the government to look after her interests even if the state of Oklahoma is providing free healthcare to her children.

“‘If for some reason Oklahoma state’s healthcare failed then I would have something to worry about because of my children, I know. But I’m really not going to worry about it because that’s one more thing to put on the plate. I don’t really trust the government,’ she said. ‘The Lord has a plan and if anything happens, then it’s meant to be’.” [G]

That’s the US tradition – God rather than the state is supposed to take care of health and welfare and good education, things that would benefit the poor if done properly. Such theological logic does not apply to military and security matters, of course. Nor to law enforcement, air safety, any of the things the rich need to see done properly. That tells you who has power and what most of them actually believe. And it tells you that most of the preachers are lackeys, much more impressed by immediate material power and wealth than by the supposed power of God.

Obama has now backed down on some aspects of his health care plan. He has to get it through Congress, he has to compromise because a US President can do little without Congress’s approval. Whether he saves any of it remains to be see.

With certainty, it shows that the electorate are totally incompetent when it comes to looking after their own interests at a national level. Absurdly easy to manipulate by media dominated by commercial interests.

One piece of ‘collateral damage’ – Britons got offended by their cherished NHS being treated as some sort of disaster area. So far the issue has been treated as an oddity, not as an indicator that US politics is very different from ours, and getting less similar all of the time. But in the end it may get through. A split in the ‘Anglosphere’ would change world politics. I don’t think it’s out of the question, though it may be a long time coming.


Madoff and Mad Finance [Financial Fraud]

More details have emerged of what Madoff was up to. It turns out that it was much worse than Enron. At Enron, they gambled away other people’s money and left some people with worthless paper after they had invested their life savings. But the Enron executives could always hope vaguely that in the end their phoney profit forecasts would come true. Whereas Madoff and his associates must have known from the beginning that they were cheating anyone who invested with them:

“Frank DiPascali will help prosecutors understand the Madoff fraud.

“How did Bernie do it? With an old IBM computer, oodles of chutzpah and, it seems, help from multiple sidekicks. On August 11th Frank DiPascali, the senior lieutenant in Bernard Madoff’s bogus fund-management business, admitted to fraud and was arrested. His willingness to confess and, apparently, to co-operate—in contrast to Mr Madoff, who went to jail insisting he acted alone—is a coup for prosecutors. They will waste no time going after the unidentified ‘other people’ with whom Mr DiPascali says he and his boss perpetrated the scam.

“Mr DiPascali was the main point of contact for investors, who ranged from Jewish charities to film moguls. He also oversaw the mechanics of the vast Ponzi scheme. It purported to be making steady, double-digit returns trading options on a share index. In fact, client funds sat in an account at JPMorgan and were withdrawn only to meet redemptions or to be parked in Treasuries and the like. This was ‘nothing more than a slush fund’, according to a complaint against Mr DiPascali by the Securities and Exchange Commission.

“Though there was no actual trading, the conspirators were far from idle. They cooked up phantom trading records, client confirmations and account statements to corroborate the fictitious investment strategy. They made thousands of wire transfers between the firm’s London and New York offices to make it look like it was earning commissions from real transactions.” [H]

It was always a conscious and well-planned fraud, not a speculation that went wrong. Which makes it even more remarkable that Madoff used personal ties to lure people in, sometimes taking most of their money and also cheating charities. The man must be an ice-cold bastard to behave like that.

But such attitudes must have been widespread in the financial community for Madoff to flourish for so long. And not cleaned up in the ‘Anglosphere’, where the emphasis is on protecting such people as ‘Wealth Creators’.

Wealth Acquirers need not be Wealth Creators – the notion that the two are the same is the basic error in Adam Smith’s economics, the useful simplification followed by all of his disciples. In the real world, they are frequently Wealth Consumers or even Wealth Destroyers, as Madoff has been, as Enron was.



[A] [,_2009], as at 31st August

[B] [] The article makes an explicit link between Vietnam and Iraq. It also offers no source for the quote, and it’s not certain that the Hanoi leadership were so prescient at the time.

[C] []

[D] []]

[E] []

[F] []

[G] []

[H] []

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