Backing up the Truck - Richard Reinhard [Archive]

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FRED

08-24-07, 08:05 AM

http://www.itulip.com/images/backuptruck.gifEditor's Note: In line with our desire to present a range of views to our readers, we have the following report by Richard Reinhard of Diversified Financial Solutions. Many of us here believe that we may be at the start of a near bear market in stocks. Richard's basic thesis is that in spite of the recent credit markets meltdown, global growth and demand, driven by Asian economic expansion remains intact. One interpretation of the report is of mining stocks as a win-win investment sector. Two ways to win: central banks succeed and we avoid both global recession and inflation, and demand continues to drive the real value of mining stocks up, or a global recession occurs, and differential dollar printing needed to rescue the US economy pushes the nominal value of mining stocks upwards–they act as an inflation hedge. One read of the report is as Ka-Poom Theory for junior mining stock investors. Read and and decide for yourself.

Backing up the Truck
Finding Value amongst the Debris

Diversified Financial Solutions, Inc.
Since: May, 1995
Editor: Richard Reinhard

Performance: Year ended April 1996 116.9%; 1997 28.1%; 1998 36.4%; 1999 39.4%; 2000 180.9%; 2001 -50.5%; 2002 18.7%; 2003 28.8%; 2004 166.7%; 2005 28.2%; 2006 153.3%; 2007 8.8%

Junior Gold and Natural Resource Sector Report - August 21, 2007
__________________________________________________ _________________________________________________

S&P/TSX VENTURE INDEX – WEEKLY CHART

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The Debauchery of Debt

Back in the ‘50’s being free of funded debt was a leading business virtue. The bluest of the blue chips had no bonds outstanding. Memories of the Depression were still so strong that investors insisted stocks have higher dividend yields than available from bonds to compensate for their inherent risk. Later in the ‘60’s the conglomerates used relatively conservative capital structures: the debt markets would never have absorbed debenture issues totaling six to nine times corporate cash flows so prevalent today.

Fast forward to the paradigm of the new millennium, where greed is good, money is cheap, and complacency rampant. Suddenly there’s a crisis of confidence. Record debt levels, the use of derivatives, new ideas in structured finance, the Yen carry trade and excessive levels of greed conveniently using other peoples’ money has accelerated the shift in expectations and rush towards the exits. With so many 30-something-year-old MBA’s responsible for billions to invest and only theoretical knowledge of the past financial panics, this rapid de-leveraging is certainly something of a wakeup call.

The rush into cash these last two weeks was evidenced by the unprecedented demand for three-month U.S. Treasury notes and a massive liquidation of all things uncertain, reminiscent of the ‘87 crash and the Asian Contagion of ‘97, certainly to those of us who were there. The 2000 “tech wreck” and 2001’s “911” will be more familiar to younger investors, and equally humbling to Wall Street wizards and Howe Street punters alike. Fear rules once again, and is a much stronger emotion than greed.

Finding value amongst the debris

This too shall pass, but history tells us there are timely opportunities to be grasped, and that a proactive approach is well rewarded. Perhaps the saddest-but-true Wall Street maxim is to buy "when there’s blood in the streets." In the heat of a market downturn, when investment accounts have been halved, it can be difficult to keep our heads about us and focus in on finding value. In heavy down-drafts, the rubber ducky gets thrown out with the baby and the bath water. The lines between excellence and mediocrity are smudged. It is within this chaos that the best opportunities are created.

Forced and untimely liquidation is the added risk for using leverage. Capitalism naturally punishes those who have made financial mistakes. This unwinding process is the economic equivalent of natural selection, whereby the weak and unfit are eliminated. Survival of the fittest is a universal law that may be delayed but cannot be over-ridden forever, even by a powerful central bank with the full backing of the U.S. economy and reserve currency status as its ace-in-the-hole. In fact, the burden of responsibility entrusted to the U.S. by the rest of the world via the Bretton Woods system now seems seriously frayed and even abused.

The world’s central banks are busy pulling out the stops in an effort to block the forced liquidation process now underway, injecting new 'liquidity' into world markets. Cheap money is being made available, security requirements are being waived, once again shoring up the careless and bailing out the fools, frauds and inept.

Like in 1987, 1997, and the early 2000’s there will be a relatively brief period of liquidation before a bottom becomes obvious and stability returns. The Fed has quickly and very publicly shifted from an inflationary stance to one of deflation avoidance. With the example of Japan’s 20-year-plus bout of stagnation and falling prices, inflation suddenly looks to be a lesser evil. The U.S. simply cannot afford the risk of a systemic spread of lower asset prices. Confidence will slowly return and the additional liquidity sloshing around will once again be out seeking superior returns.

The recent blow off liquidation in stocks with strong underlying assets and visible near term production has created an opportunity for investors to position at severe discounts to highs made only a few short weeks ago.

The flight to quality will be key – companies that are fully financed to make that final step to generate cash flow are the first companies that should considered.

Underlying demand intact

The most powerful force behind these periodic episodes of global money mania is demographics. The industrial world is aging. Average incomes in the U.S. have fallen every year from 2000-2005 while those in Asia are rising rapidly. The average baby-boomer, part of the largest and wealthiest demographic bulge in the western world, is facing retirement age. A huge, growing pool of money earmarked for retirement is scouring the world looking for profitable investment opportunities. The supply of capital is far greater than the available investment opportunities in the developing world, a classic recipe for continued financial booms and busts.

Of course, money manias are not all bad. In a sense, manias are an inevitable part of the risk-taking that creates wealth and higher living standards - manias are in the nature of capitalism. Many of America's leading high-tech companies and downtown office towers were financed during money manias. Similarly, overseas investors financed a lot of productive investment in Asia.

Largely unaffected during this toxic-debt-driven crisis of confidence are the mouth-watering returns being generated around the rapidly expanding Asian markets. There, debt is largely unavailable or even conveniently non-repayable for the well-connected, and the personal and corporate savings rates are staggering. China’s foreign reserves are now in excess of US$1.5 trillion and rising, and in search of investments that provide much-needed resources in scarce supply, and an alternative to a rapidly eroding U.S. dollar.

Scarce resources you can touch and feel

With the U.S. Fed confirming its resolve to avoid deflation and exacerbating the unwinding of the real estate boom, investors have a narrow window right now to position into companies that are well positioned to lead the recovery of confidence. The fact is that commodities remain strong, even while the emerging miners have been crushed, and there really is little risk that the world economy will appreciably slow down. The U.S. is still an influence of course, but the world and particularly China and India have the momentum and the demographics that virtually ensure continued hyper-demand for most of the world’s resources for years to come.

The markets are offering the opportunity of the decade to back up the truck and position for a resumption of the resource-sector bull market at a significant discount. Where we want to invest today is not with the crowd. The U.S. dollar has significant downside risk as rates come off, and 3-month Treasury Bills are simply a place to lose purchasing power.

Successful resource stock investing means investing in companies that may be headquartered in Canada, the U.S., Australia, Britain, France, Brazil, Italy, South Africa, Norway or China, to name only some of the nations with established, publicly-traded, commodity producers. Investors benchmarking to major stock indices such as the S&P have only modest exposure to commodities, which means the energy stocks dominate their commodity weighting. There is now only one base metal Company in the S&P 500 and 400 combined, so U.S. investors who are restricted to American stocks simply have no ready opportunities available in the metals. Eventually they will feel compelled to expand their horizons.

Even in Canada investors have had to rethink their commodity exposure since Inco and Falconbridge were deleted from the TSX, and with Alcan being courted. Consolidation and takeovers are contracting the available investment vehicles. Commodities and commodity stocks are where you find them, and Canada still offers some of the best of the world’s emerging producers – those very companies that will be sought and bought as the resource sector continues to enjoy windfall earnings.

Canada – a double win

Canada is a leader in mining innovation and capital raising, and has a strong currency and economy. As I outlined in my April 30, 2007 Portfolio Review Edition the best place for U.S. and Canadian investors to place aggressive investment dollars is within the Canadian resource sector – garnering exposure to a strong currency, finite resources and exceptional management and mining expertise.

Arguably, the resource sector’s best opportunities are found with fully funded near-production juniors with assets in place, strong economics modeled using low deeply discounted assumptions, and proven management. With a half-dozen of these in our model portfolio, and several others having maybe two out of the three elements in place, we have been busy adding to our holdings given the recent buyers strike.

Yes, investors have now woken up to how global risk has been mispriced in recent years. Markets became too greedy in selling collateralized debt obligations and financing leveraged buyouts and investors under-appreciated the hazards. All we got from the U.S. leadership were boilerplate and hollow calls for flexible exchange rates. There was no demand for Japan to reduce incentives for the so-called yen-carry trade. Borrowing cheaply in Japan and investing the funds in higher-returning assets elsewhere fueled many of today's riskiest hedge-fund trades. Yet Japan is reluctant to let the yen rise, and global policymakers continue to wimp out on demanding it.

Asia has come a long way since the 1997 Asian Contagion. Banks are far more stable, currency reserves have been amassed, and governments are modernizing and integrating financial systems. Asia's post-crisis recovery is a work in progress, though, and one shouldn't overstate the extent to which Asia has de-coupled from the U.S. economy. While Asia's rapid growth and booms in both China and India mean it's less reliant on the U.S., the region isn't ready to live without U.S. demand. Likewise, the U.S. isn’t ready to wean off large screen TVs, computers, or all things priced at a fraction of anything made locally, anytime soon.

Assuming that the write-downs to the investment banks are in the $150-200 billion range, this will prove to be a painful, but mostly manageable flogging on Wall Street. Much of the poisonous paper was distributed to institutions abroad, and, as the recent bailout of a small Dusseldorf bank which gorged on subprimes demonstrates, the costs are disseminated globally, which means they should be absorbed without creating serious systemic risk.

Most resource companies’ earnings and cash flow are correlated to the growth of China, not the collapse of America. The same could be said for most of Canada’s resource sector. In a world of integrated financial markets and a synchronized bull market in all asset classes (fed by the credit bubble), you can expect all assets to correct as the bubble collapses. But the good thing about metal is that it's hard – it doesn’t go to zero value. It goes clunk when it hits the ground. Tangible assets will find a floor sooner than financial assets because resource companies are backed by demand in the real economy. The real economy will chug along in fits and starts, even while the financial economy goes up in flames.

The U.S. dollar is commodities’ benchmark

When money is created out of thin air it tends to force down the value of your currency against everyone else's. With practically the whole world printing money to put the crisis at bay, how can the dollar go down against the euro when the CBs in charge of the euro are printing just as much currency as the Fed is dollars?

When all is said and done, this bailout will translate into a massive depreciation of the world's major currencies against goods and services globally (read commodities, gold and inflation). In other words, inflation is about to erupt higher - much higher than expected, and globally.

We will continue to see a dollar appreciation in most assets; in particular commodities, especially precious metals and the general stock markets will rise to new highs again. This is another correction in an ongoing bull market. There can be no doubt that the U.S. will inflate to avoid a recession that could result in a debt implosion, the Fed is scared to death of this because they know the overly extended debt situation the country is in.

Of course the Fed could blow it and we fall into a deep recession before inflation goes much higher. This is highly unlikely though as they stand ready with massive amounts of dollars they can readily create out of thin air. Like Japan, they will lower interest rates to zero if necessary and continue to massage and cloud their statistics to bolster their case. The CPI numbers can and will be easily manipulated over a course of the year to help justify their actions, but over the long term the debt markets will not be fooled - meaning long term rates will need to go higher. Although stocks and the indexes will make new highs, when adjusted for inflation and the depreciation in the dollar their returns will be poor or negative, as we have seen over the past few years.

Yes, some of the base metals have sold off because investors are expecting weaker demand from a slowing U.S. economy, but in the end it is the consumption from Asia and investor demand that will drive these prices back up. Even with a U.S. recession, people still have to eat and we are competing with a rising living standard in Asia that is driving demand for foods higher.

This correction has not seen any appreciable sell-off of precious metals and commodities. Hard assets like commodities will be the premier asset to own in the years ahead, just like the '70s, and periodic corrections offer windows of opportunity for positioning portfolios.

Your Source for High-Potential Early-Stage Growth Stocks Since 1995
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Diversified Financial Solutions, Inc.
Since: May, 1995
Editor: Richard Reinhard
E-Mail: rreinhard@shaw.ca

Copyright © 1995-2007 by Diversified Financial Solutions, Inc. All Rights Reserved
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Lukester

08-24-07, 04:01 PM

Fred -

It's late to profer this alternate view. There's a stiff rebound already in progress on a portfolio of Canadian natural resource juniors and mid-caps. These stocks have been gapping up 20% - 40% per day since Friday last. Another couple of days like this will make the 'crash' a mere pencil line in their yearly charts.

The argument for natural resources as both inflation hedge and also a fundamental story with a lot of legs to it for the next decade is more than a contrary view - it is a substantial argument to be rebutted at a fundamental level, or not at all -

I've sold these stocks after holding them for close to four years through thick and thin, and some downturns almost as nasty as this one (60% weekly drop across the board) on the powerful macro-arguments put forward at iTulip.

However here's some food for thought - the collected views regarding timing exits and entrances to the market, from some names we probably all find familiar:

Benjamin Graham, the father of value investing: "If I have noticed anything over these 60 years on Wall Street, it is that people do not succeed in forecasting what’s going to happen to the stock market."

Warren Buffett, chairman of Berkshire Hathaway: "We've long felt that the only value of stock forecasters is to make fortune tellers look good. Even now, Charlie and I continue to believe that short-term market forecasts are poison and should be kept locked up in a safe place, away from children and also from grown-ups who behave in the market like children."

John Templeton, pioneer of global investing and legendary manager of the Templeton Growth Fund: “I never ask if the market is going to go up or down next year. I know there is nobody who can tell me that.”

Peter Lynch, the best performing mutual fund manager of all time, in his book, One Up on Wall Street: "Thousands of experts study overbought indicators, oversold indicators, head-and-shoulder patterns, put-call ratios, the Fed's policy on money supply, foreign investment, the movement of the constellations through the heavens, and the moss on oak trees, and they can't predict the markets with any useful consistency, any more than the gizzard squeezers could tell the Roman emperors when the Huns would attack.”

zoog

08-24-07, 05:29 PM

How did I know Lukester would be the first one to post on this?:D

I've sold these stocks after holding them for close to four years through thick and thin, and some downturns almost as nasty as this one (60% weekly drop across the board) on the powerful macro-arguments put forward at iTulip.

Are you having sellers remorse?:eek:

I have two or three metal mining stocks, which I have held onto even though they dropped with the rest of the market recently. While they have been doing so, I started to wonder if I made a mistake buying into them, based on what some were saying here about the fact that despite any potential value in the shiny stuff they're digging out of the ground, stocks are stocks. That and the threads were all abuzz with talk of "flight to cash". But holding out waiting for the right time to jump back in has its risks as well. As your quotes illustrate, no one really knows exactly the right time.

Still not sure what to think, but I'm keeping them because I do believe commodity-related stocks will act as an inflation hedge over the next few years. That is to say, I agree with this:

(Richard Reinhard) When all is said and done, this bailout will translate into a massive depreciation of the world's major currencies against goods and services globally (read commodities, gold and inflation). In other words, inflation is about to erupt higher - much higher than expected, and globally.

Odd, I hadn't really thought of this as being contrarian to Ka-Poom or any of the other major statements from EJ until now. But this...

Many of us here believe that we may be at the start of a near bear market in stocks.
.
.
.
(Richard Reinhard) We will continue to see a dollar appreciation in most assets; in particular commodities, especially precious metals and the general stock markets will rise to new highs again. This is another correction in an ongoing bull market.

... does suggest a difference in views.

I think it's worth noting that he goes on to say:

(Richard Reinhard) Although stocks and the indexes will make new highs, when adjusted for inflation and the depreciation in the dollar their returns will be poor or negative, as we have seen over the past few years.

Still, couldn't the rise in commodities, mining stocks, etc. be part of the next Poom? This is how I reconcile the statements in my mind.

My hope would be that resource stocks and precious metals at least manage to tread water against real inflation, unlike, apparently, everything else.:( Oh wait, except for alternative energy and infrastructure, gotta throw those in too.;)

trex

08-24-07, 05:41 PM

The only question I have is this. How can an economy founded on credit driven consumption expand when credit contracts? What would global growth have to be to replace the impact of a contraction?

metalman

08-24-07, 05:45 PM

Lukester

08-24-07, 10:09 PM

Metalman -

<< a fine markets 101 lecture. not sure you're giving it to the right guys, tho. i bet if fred posted this when it first came out 8/20, you still make the the same points on market timing? >>

I'm not understanding what you are saying here. Can you put it more clearly? Wasn't aware the lecture was mine - if you read it, these were just quotes from some other people.

For what it's worth, I think Fred's a pretty smart guy. What are you trying to point out to me? Can you clue me in? :)

DemonD

08-25-07, 02:30 AM

I generally agree with Reinhard's assertions, that miners and especially junior miners are a great way to play commodities and inflation.

I will assert however that he is too early. Even 20% off recent highs is not much of a correction as many mining companies have returned 200-500% over the past 5 years. I have been convinced by arguments of others (was it jk or finster? I forget) that miners will be hurt in terms of stock price much worse than the rest of the market in a swift market downturn.

The time to buy miners will come, but now is not the time to "back up the truck." Now is the time to build a watch list of every single mining company on the planet and study some of them to see which ones are solid and which ones are traps, and wait for the stock market shakeout to put some of these guys on sale.

bart

08-25-07, 12:41 PM

Benjamin Graham, the father of value investing: "If I have noticed anything over these 60 years on Wall Street, it is that people do not succeed in forecasting what’s going to happen to the stock market."

Warren Buffett, chairman of Berkshire Hathaway: "We've long felt that the only value of stock forecasters is to make fortune tellers look good. Even now, Charlie and I continue to believe that short-term market forecasts are poison and should be kept locked up in a safe place, away from children and also from grown-ups who behave in the market like children."

John Templeton, pioneer of global investing and legendary manager of the Templeton Growth Fund: “I never ask if the market is going to go up or down next year. I know there is nobody who can tell me that.”

Peter Lynch, the best performing mutual fund manager of all time, in his book, One Up on Wall Street: "Thousands of experts study overbought indicators, oversold indicators, head-and-shoulder patterns, put-call ratios, the Fed's policy on money supply, foreign investment, the movement of the constellations through the heavens, and the moss on oak trees, and they can't predict the markets with any useful consistency, any more than the gizzard squeezers could tell the Roman emperors when the Huns would attack.”

Jesse Livermore

"I know from experience that nobody can give me a tip or a series of tips that will make more money for me than my own judgment."

"I believe it is a safe bet that the money lost by short-term speculation is small when compared with the gigantic sums lost by so-called investors who have let their investments ride. The intelligent investor will act promptly, thus holding his losses to a minimum."

John Templeton

"The four most dangerous words in investing are, 'It's different this time.'"

Lukester

08-26-07, 01:46 PM

Bart -

Jesse Livermore was probably more brilliant than all the rest put together. But he was also erratic and some contemporary biographers wonder if he was possibly bi-polar. He made and lost several fortunes with great resilience, yet put an end to his life due to yet one more very large reversal of fortune.

The other investors quoted above look almost cautious compared to Livermore, yet they are all brilliant in their own right too. Tellingly, none of them went through the cataclysmic trading lifestyle which Livermore put himself through. Anyone as gifted as Livermore at compiling a fortune several times over should never have worried about ending up broke, as he seems to have had a supreme gift for making it all back again. Maybe he just got tired ...

However I do clearly take your point here Bart. As they say, "there's more than one way to skin a cat".

With regard to timing this market in late 2007, JK seems to have summed it up best, over on Finster's "Deflation has Arrived" thread, observing :

http://www.itulip.com/forums/images/icons/icon1.gif Re: Deflation Has Arrived
<HR style="COLOR: #99ff99" SIZE=1>" we've had a number of scares. the sell off of may-jun 06, the crack in feb 07, and then this latest, and scariest, of episodes. it's like the tremors that precede a volcanic eruption, i guess. next one the charm? "

He's defined iTulip's position at least as I've understood the "sell everything" call - nothing bad may occur, or something bad may occur - iTulip is simply observing a sharp increase in risk in the environment in 2007 such that they are leery of just about all equity classes at this time. Therefore one's participation in the equities markets must be in recognition of the full meaning of 'risk capital'.

My apologies to Fred for any querulous tone others may percieve in my prior post - We can only note the markedly jaundiced views which Templeton, Buffett and Lynch have about the practice of market timing. As these names are all considered to have "written the book" on the most successful yet conservative style of investing, any replies which glosses over that here do not answer the question they pose - which is not irrelevant to investing discussions on iTulip.

As for you Bart - anyone as authoritative as you who also displays such a thoroughly wacky and whimsical sense of humor (very unpredictable!) must win my full respect. It's a clear sign you have not the slightest trace of pomposity - and that's a combination of attributes I have always respected more highly than any other. So if you tell me I'm flat wrong, I'll have to give it some very hard thought! All hail the "Bartus Maximus"! ;)

_____________

Footnote - I listened in on the Noland interview at Financial Sense which Spartacus noted this weekend - and yes, it fully reiterates iTulip's macro view, that there is a whole layer of massive risk now introduced into the markets due to the seepage from sub-prime / CDO swamp into banks and other finance worldwide. Noland is indeed saying "it's a whole new ballgame" and risk is now massive with markets being levitated by the multiple 'central bank puts' now underpinning global equities. So I hope Fred will accept my expression of appreciation - that I do grasp the full sobriety of iTulip's market stance and recommendation at this time.

Seems Financial Sense picks up on and adequately reports many of the critical themes which iTulip covers. They have a different format, perhaps not as "sophisticated to finance" as iTulip, however they do a quite robust job of covering many major issues. I regret their community does not seem to garner more broad based respect here, as I'm sure they all fully respect iTulip. The only group of pundits to earn their open disregard are the "deflationists"!! (?) :rolleyes:

bart

08-26-07, 03:43 PM

Bart -

[FONT=Arial][SIZE=2]Jesse Livermore was probably more brilliant than all the rest put together. But he was also erratic and some contemporary biographers wonder if he was possibly bi-polar. He made and lost several fortunes with great resilience, yet put an end to his life due to yet one more very large reversal of fortune.

The other investors quoted above look almost cautious compared to Livermore, yet they are all brilliant in their own right too. Tellingly, none of them went through the cataclysmic trading lifestyle which Livermore put himself through. Anyone as gifted as Livermore at compiling a fortune several times over should never have worried about ending up broke, as he seems to have had a supreme gift for making it all back again. Maybe he just got tired ...

However I do clearly take your point here Bart. As they say, "there's more than one way to skin a cat".

With regard to timing this market in late 2007, JK seems to have summed it up best, over on Finster's "Deflation has Arrived" thread, observing :

Good points all, and you did indeed get my actual point.

Livermore was certainly human and had his faults but I very much hesitate in using a term like bi-polar since it has very little actual full scientific basis in my opinion... and I hope that comment doesn't take the thread off on a tangent.

I think his erratic nature was *hugely* encouraged (if not created) by the nasty and anti-social character at the innards of the stock and financial markets themselves, as well as by hanging around too much with some of the less ethical and moral folk surrounding it.
Getting tired works for me too.

As for you Bart
...
It's a clear sign you have not the slightest trace of pomposity
...

Wow, thanks very much for the unexpected and very kind words... but you should have been here last week when my daughter was in town. She could have easily disabused you about my pomposity... ;)

Footnote - I listened in on the Noland interview at Financial Sense which Spartacus noted this weekend
...

[FONT=Arial][SIZE=2]Seems Financial Sense picks up on and adequately reports many of the critical themes which iTulip covers. They have a different format, perhaps not as "sophisticated to finance" as iTulip, however they do a quite robust job of covering many major issues. I regret their community does not seem to garner more broad based respect here, as I'm sure they all fully respect iTulip. The only group of pundits to earn their open disregard are the "deflationists"!! (?) :rolleyes:

I too have a great deal of respect for Jim Puplava and Financial Sense and almost always listen to the weekend's podcast (speeded up by 40-50% by one of the normal WMP built-ins - they're quite long).

I've been listening to them since 2003 when I first heard about them, and a number of the pages on my site were encouraged by things they've covered.

Lukester

08-26-07, 03:54 PM

<< speeded up by 40-50% by one of the normal WMP built-ins >>

That's a neat trick. Now I have to learn how to speed-read iTulip! :rolleyes:

08-26-07, 04:00 PM

livermore was a trader, the others you quote investors. i would imagine the average holding times of graham, buffett and templeton were a good deal longer than livermore's.

temperament matters a lot, and time frame changes what works. someone mentioned "seller's remorse," presumably feeling bad when you sell and then see the item go up. but what is the time frame on which you evaluate your decision? maybe it's up this week but will crash next month. maybe not. the trick is finding an approach you can live with emotionally, as well as rationally.

[btw, i don't put much stock in the psychiatric diagnosis of historical figures, but, at the risk of "tangenting", will register my knowledge of the functional and genetic reasons "that" bipolar is a reasonable diagnostic category. our categories won't be really good until we understand more physiology, but the consistency of various raters, the predictability of drug responses, the strong evidence of genetic transmission and the relatively new findings about loss of gray matter in specific areas of the cortex correlated to the diagnosis, lead me to say the science isn't bad at all.]

bart

08-26-07, 04:13 PM

[btw, i don't put much stock in the psychiatric diagnosis of historical figures, but, at the risk of "tangenting", will register my knowledge of the functional and genetic reasons "that" bipolar is a reasonable diagnostic category. our categories won't be really good until we understand more physiology, but the consistency of various raters, the predictability of drug responses, the strong evidence of genetic transmission and the relatively new findings about loss of gray matter in specific areas of the cortex correlated to the diagnosis, lead me to say the science isn't bad at all.]

You and I have been here before on psychiatry and the drug poisons that many psychiatrists push, and the disgusting and heinous aspects of electro-shock, and the idiocy of the DSM which is based on votes of folk with vested interests and not science... as well as other areas.

That's why I was careful to not bring it up since then and to make the note about a tangent, hoping that you would not jump in with partial and incomplete facts and start it up again. But if you insist...

Lukester

08-26-07, 04:22 PM

JK -

As you note, there is a highly dangerous emotional mechanism which sets in if you sell long held positions at a low and watch them soar. Speaking for myself, once I sell something I am well aware of that risk, and exercise complete detachment. I can watch it soar with a reasonable degree of equanimity. And soar they did - approximately 40% across the board in 2-3 days.

This was a carefully constructed, cherry picked portfolio of Jim Dines' very best Uranium thoroughbred stocks. These are the "keepers" for the decade, the ones that will deliver strong reserves growth and robust production when everyone is panicking about petroleum reserves. They are the half dozen in five hundred flim-flam stocks with the real goods.

Dines has one of the best researched portfolios covering the precious metals and uranium out there. He makes people like Paul Van Eeden look like a myopic accountant with his eyes glued firmly to the rear view mirror when evaluating uranium's prospects ten years out. Indeed, Van Eeden has led many a long term investor astray.

My mistake selling - I forgot my own primary rule - read everyone's opinions with care, but make your own decisions based on where you think things will be 5 years out. If you rate a stock a "keeper" it should remain a "keeper".

iTulips arguments are solid and fundamentally correct - but there is no "universal theory" or "universal handbook" on how to invest in any given year.

I agree however on you point (or I think it was part of your point anyway) When you sell something, don't ever then chase it. Learn from your decision - whether it was the right or the wrong one.

Always appreciate your comments. Seems you are hitting a lot of those deep bass strings these days. JK is now a more somber man than I was reading a few months ago.

Lukester

08-26-07, 04:27 PM

Bart -

Please be advised my own doctors think my electroshock therapy has been a great success!! Three years of continuous treatment is now yielding good results, or so they tell me.

It was confided to me recently that (eventually) they are going to write me up in the New England Journal of Medecine as an interesting case study. I'm in great anticipation of becoming famous.

bart

08-26-07, 04:59 PM

Bart -

Please be advised my own doctors think my electroshock therapy has been a great success!! Three years of continuous treatment is now yielding good results, or so they tell me.

It was confided to me recently that (eventually) they are going to write me up in the New England Journal of Medicine as an interesting case study. I'm in great anticipation of becoming famous.

Have they provided you with a great cage too, like mine? ;)

http://www.nowandfutures.com/grins/cage3.jpg

Lukester

08-26-07, 05:25 PM

You gotta debate JK about bi-polar disorder now.

bart

08-26-07, 05:31 PM

You gotta debate JK about bi-polar disorder now.

I seriously and honestly hope it doesn't happen.

It's one of the very few broad subject areas about which I feel *very* strongly, partially from direct and personal experiences.
JK & I are polar opposites, and then some...

08-26-07, 05:37 PM

I seriously and honestly hope it doesn't happen.

It's one of the very few broad subject areas about which I feel *very* strongly, partially from direct and personal experiences.
JK & I are polar opposites, and then some...
bipolar opposites.
let's let it go. i wasn't the one to bring it up in the first place ...;)

Lukester

08-26-07, 05:43 PM

Like J&B scotch, but with a difference. Both smooth, but not blended?

bart

08-26-07, 05:49 PM

bipolar opposites.
let's let it go. i wasn't the one to bring it up in the first place ...;)

Cool, and that's a relief.

I say we gang up on Lukester for bringing it up... ;)

Spartacus

08-28-07, 12:09 AM

Some names to add to your list of financial commentators,

Charlie Chaplin, of course, whose economic theories were outlined in "Modern times"

And also Buster Keaton, whose economic theories were illustrated when an entire bank fell on him.

And David Cronenberg, who in "Scanners" lucidly portrayed what happens when one listens to FED congressional testimony (no, that's NOT an excedrin headache) - also in Existenz and "the Brood" what happens when a sub-culture gets too wrapped up in itself (hedge funds, anyone?)

And Bollywood, which is a comment on US capitalism - song & dance routines - but their commentary is too sincere - it needs to be more cynical (and needs conspiracy theories) to really touch the heart of the matter.

Fred
Benjamin Graham,
Warren Buffett
John Templeton
Peter Lynch

Lukester

08-28-07, 12:40 AM

Spartacus -

<< song & dance routines - but their commentary is too sincere - it needs to be more cynical (and needs conspiracy theories) to really touch the heart of the matter >>

LOL !!

A clear unsentimental eye, gazing compassionately upon America's sagging countenance, from north of the border ... :D

I swear one of these days I'm going to do a bunk and defect to Canada. There's a guy posting here from Vancouver who swears it 's a great place to live!

Chris Coles

08-29-07, 06:00 AM

Returning to the origins of this debate, there is another commodity that seems to be off your horizons that has raised its head here in the UK, food prices. We have had a very bad summer. June and early July were as bad as they get and the result has been a reduced yield on the farm. So what? The answer is that our grain reserves are at an all time low and demand is steadily increasing with the added premium of the impetus for Ethanol production from several forms of agricultural material.

Food prices have started to rise dramatically. Feed prices for cattle have risen as much as 40% in a single year.

Now add another wrinkle; the rapidly increasing ice melt in the Arctic.

Disaster theory shows a graph with a long run up to a period of stability where try as hard as one might, nothing will continue the earlier rise in the graph. Then a downturn followed by a return to the former levels which again refuse to continue beyond the original stability. Finally, the graph drops to the original starting point.

The Arctic ice is right now at levels predicted for 2050 and Greenland is shown almost completely surrounded by water, August 15th.

http://www.universetoday.com/2007/08/17/arctic-ice-coverage-will-shrink-to-2050-projections-this-summer/

Quote from Universe Today: "Here's the scary part. The United Nations Intergovernmental Panel on Climate Change predicted that this level of ice coverage would be met in 2050. I'll say that again, Arctic ice will reach levels predicted for 2050 by the end of this summer. I wonder what the levels will be in 2050?
Here's what one official had to say about the IPCC predictions:
The IPCC forecast cannot adequately explain what is now happening in the Arctic Sea."
Original Source: JAXA News Release (http://www.jaxa.jp/press/2007/08/20070816_arctic_e.html)

http://www.jaxa.jp/press/2007/08/20070816_arctic_e.html (http://www.jaxa.jp/press/2007/08/20070816_arctic_e.html)

Food is the commodity that is going to run out, not oil, not water, food. And, not in some indeterminate timescale way way ahead in the far future; but right now, this decade.

Not caused by our inability to grow more via better technology. Simply because the weather will no longer be stable enough to ensure success with any crop anywhere on the planet.

When that fact starts to sink in this planet is going to become a very dangerous place indeed. That simple fact will trigger the collapse of the disaster theory graph.

Lukester

08-29-07, 01:08 PM

Chris -

I agree with your entire post. However the mishaps approaching are multiple.

We also have overpopulation reaching it's sharpest inflection point (6.5 billion rising past 7.5 billion in only 20 more years), simultaneous to liquid hydrocarbons resource (fertilizer price soaring), water depletion, desertification, deforestation of the remaining large equatorial canopy, CO2 levels soaring, carbon blackening of polar ice tipping the climate trend to a runaway trend, and as icing on the bad news cake, the emergence of a new oil cartel intent on using energy scarcity as a tool to secure a new political stranglehold by rogue states (Chavez, Mullah's etc).

What a nasty soup! Envy the Canadians however, for whom warming will thaw out a vast continent-wide virgin territory to farming and natural resource production - 30 million people with a continent of resources.

Spartacus

08-29-07, 01:56 PM

Chris -

What a nasty soup! Envy the Canadians however, for whom warming will thaw out a vast continent-wide virgin territory to farming and natural resource production - 30 million people with a continent of resources.

Don't count on getting lots of food out of it.

What's currently up north is not suitable for farming, even if it thaws out.

The reason the praries are good for farming is that in the last ice age the glaciers scoured the northern Canadian Shield and deposited the scoured dirt (soil) on the praries. Northern Canada is now largely bare granite, and in many regions the glaciers are still sitting there.

Maybe new soil-making technonogies should be invented, something like dynamiting Granite (dynamite has lots of nitrogen), then seeding it with fungi and bacteria. Or maybe synthetic lightning to blast bare rock (lightning has the added benefit of generating lots of nitrous oxides)

Even where there is soil in the north, it's rocky stuff that is not great for food.

At least, that's my memory of high school geography/geology.

EDIT: it could be good for meat production, as the soil may be good for various grasses - you might be able to farm rabbits and various herbivores on that

Chris Coles

08-29-07, 02:09 PM

There is one small comment I have to disagree with, your mention of Chavez as any form of threat. Personally, I see him as having a simple interest in his people. You need to watch the excelent doccumentary, War on Democracy by John Pilger. http://www.johnpilger.com/

This is also by Pilger; I quote:

"The similarities in the campaign against the phenomenal rise of popular democratic movements today are striking. Aimed principally at Venezuela, especially Hugo Chavez, the virulence of the attacks suggests that something exciting is taking place; and it is. Thousands of poor Venezuelans are seeing a doctor for the first time in their lives, their children immunised and drinking clean water.

On July 26 Chavez announced the construction of fifteen new hospitals; more than 60 public hospitals are currently being modernised and re-equipped. New universities have opened their doors to the poor, breaking the privilege of competitive institutions effectively controlled by a “middle class” in a country where there is no middle. In Barrio La Linea, Beatrice Balazo told me her children were the first generation of the poor to attend a full day’s school and to be given a hot meal and to learn music, art and dansce. “I have seen their confidence blossom like flowers,” she said. One night in barrio La Vega, in a bare room beneath a single light bulb, I watched Mavis Mendez, aged 94, learn to write her own name for the first time.

More than 25,000 communal councils have been set up in parallel to the old, corrupt local bureaucracies. Many are spectacles of raw grass-roots democracy. Spokespeople are elected, yet all decisions, ideas and spending have to be approved by a community assembly. In towns long controlled by oligarchs and their servile media, this explosion of popular power has begun to change lives in the way Beatrice described. It is this new confidence of Venezuela’s “invisible people” that has so enflamed those who live in suburbs called Country Club. Behind their walls and dogs, they remind me of white South Africans."

I suggest that you read the full article: <TABLE cellSpacing=0 cellPadding=0 width=153 border=0><TBODY><TR><TD class=jpTitle2>THE GHOST OF PINOCHET HAUNTS THE CAMPAIGN AGAINST CHAVEZ (http://www.johnpilger.com/page.asp?partid=450)</TD></TR><TR><TD class=jpTitleGap></TD></TR><TR><TD class=jpBody>In an article (http://www.johnpilger.com/page.asp?partid=450) for the Guardian, John Pilger describes how he sought the help of Chile's former political prisoners, tortured by Pinochet, in the making of his film, The War on Democracy, and how they bear witness to the historical meaning of the current campaign of propaganda and lies aimed at Venezuela and Hugo Chavez.</TD></TR></TBODY></TABLE>

The United States has been sold a pup, and a very poor pup at that, and for a very long time too. It is about time you all woke up to the reality; change is in the air and ordinary people are beginning to realise they can have a life too.

Chris Coles

08-29-07, 02:45 PM

Don't count on getting lots of food out of it.

What's currently up north is not suitable for farming, even if it thaws out.

You are correct, but the country that will gain by far the best advantage is Russia. They have a vast area of permafrost, possibly several times the area in Canada that has been thawed out during every summer since 2000. (I flew over it twice during 2001) and it is prime land. We sometimes get reports of Mammoths being found and when they show us the region it is a thirty foot thick layer of alluvial soil through which runs a river, exposing the Mammoths in the river bank.

A very large area of the US is already semi permanent desert and global warming will make that worse. Though the recent floods may point towards a warmer and wetter Central Plains. You never know?

Lukester

08-29-07, 06:15 PM

Chris -

I don't think you'll find many takers for these insights about Chavez among the majority of readers here. I may agree with you wholeheartedly on global warming, but to call Chavez an emancipator has me almost falling out of my chair in mirth. And it would be best not to make the mistake of believing that those who disagree with this generous portrayal of Chavez' efforts for 'emancipation' of the poorest in that country are dupes of our US media either.

It's a grievous mistake to seek the sustainable resolution of aggravated socio-economic problems in a tin-pot 'emancipator' who it seems has pursued nothing more than the systematic dismantling of a formerly model set of democratic institutions in Venezuela. And yes, Venezuela actually had a fully functioning democracy not too many years ago.

Democracies are all deeply flawed, some may require a diligent degree of activism to stir into self-improvement - but I will not never throw my lot in with those who presume that by installing a strongman you'll find better solutions. Not ever.

The error is simple and plain to see. When you have all the mechanisms of democracy in place, it's imperative to build reform over them, not demolish them in the hope something radically different will arise from revolution which dispenses with re-establishing any genuine parliamentary democracy again. That road has been disastrous throughout history.

Venezuela pre-Chavez had : an upper and lower house of parliament, presidential term limits, at least the rudiments of a progressive taxation structure, an independent judiciary, free elections (yes, many elections are partially bought worldwide, but that's a far cry from elections openly settled by intimidation or thuggish militia force).

Venezuela had clear limits to government intrusion into the private sector. Venezuela had better rudiments of a true democracy than any country in Latin America. Social inequality in Venezuela is an evil - but it's even worse in other nations we are not even mentioning.

When you have all those starting blocks of a democratic system, it's critical to understand that they were arduously constructed over a century - they must be improved, not demolished, to find more equality and genuine freedom for their people. Even amid rampant corruption and class inequality - the responsible, constructive advance comes from reform, not social revolution spearheaded by an aspiring dictator.

If you believe a dictator is the only party capable of achieving social justice for the poor, you are invited to go and actually live in such a social experiment to temper that enthusiasm with a little reality.

What never results in social advance is the systematic dismantling of those democratic institutions, because once dismantled and the country embarks on an experiment in fiat rule by a one-man authoritarian system, the system takes a fatal step back across a threshold - from which further progress back into parliamentary democracy becomes incomparably more difficult.

In Venezuela, Chavez dispenses subsidies to the poor like candy, to buy a vote to guard his rear while he systematically dismantles all the architecture of a multi-party system. He's funding his candy for the poor by rapidly squandering the national petroleum endowment - used entirely to arm his intrusion and takeover of the vestigial democratic institutions.

Americans have a very bad stereotype going for them in the world, as duped entirely by a right wing media into mistaking for real democracy some mere gaudy trappings of it in many countries with which we carry on a brutally self-interested commerce.

I lived in Europe half my life and have seen this facile caricature of Americans up close. I did not much respect it then, and still don't, as it's based on intellectually lazy stereotypes. I see America's failures and ugliness up close also. But make no mistake, Americans for all their sloth and complacency at general elections, for all their deep flaws, can still employ a perfectly good rudimentary sense of smell, to discern in broad outline the real from the fake democracies quite well.

Our government, especially in recent years, has descended into quite a bit of unscrupulous power bargaining, but I for one remain utterly incredulous when I read people from western nations such as the US, Canada or the EU who have spent their lives protected by the many safeguards of even the most compromised of our western democratic systems who go on to claim dictatorship is the only way to provide emancipation for the desperately poor. I am incredulous to read anywhere, that anyone is willing to portray Chavez as an "emancipator of the poor".

Chavez is the "emancipator" of Chavez alone. He uses the poor every bit as thoughtlessly as he uses Venezuela's oil endowment - to carry out a brittle and calamitous ideological experiment in top-down government. Education for the poor or not - what's happening in Venezuela is only a bad and vicious caricature of emancipation for the disadvantaged.

Jim Nickerson

08-29-07, 06:28 PM

Lukester

08-29-07, 06:38 PM

Spartacus

08-29-07, 06:53 PM

I thought the geology of Siberia was similar to northern Canada (major export black flies and mosquitoes)

Also note that Siberia (and Northern Canada) are far, FAR smaller than they look on the standard maps

Note that Africa is 2/3 the size of Asia, even though on the standard maps Asia (Including Russia) looks three to 4 times the size of Africa.

( I saw similar numbers on a couple of sites - I don't think they include Russia in "Europe")

http://www.net-comber.com/worldarea.html
CONTINENTS
Asia 17,200,000 44,547,800 8.73%
Africa 11,600,000 30,043,900 5.89%
North America 9,365,000 24,255,200 4.76%
South America 6,880,000 17,819,100 3.49%
Antarctica 5,100,000 13,208,900 2.59%
Europe 4,017,000 10,404,000 2.04%
Australia 2,968,000 7,687,100 1.51%

You are correct, but the country that will gain by far the best advantage is Russia. They have a vast area of permafrost, possibly several times the area in Canada that has been thawed out during every summer since 2000. (I flew over it twice during 2001) and it is prime land. We sometimes get reports of Mammoths being found and when they show us the region it is a thirty foot thick layer of alluvial soil through which runs a river, exposing the Mammoths in the river bank.

A very large area of the US is already semi permanent desert and global warming will make that worse. Though the recent floods may point towards a warmer and wetter Central Plains. You never know?

Jim Nickerson

08-29-07, 07:02 PM

Jim -

You can have it - but please don't ever try to shove that "strongman solution for social justice" down my throat in my own country - that's when I'll pick up a gun and go to the barricades. And yes, I'd have to take hurried lessons as to how to fire the damn thing because I've never fired a gun in my life.

And let me assure you also, so you can gauge the depth of my antipathy for this 'solution' - that I'm one of those warm hearted fools who empty their wallet to every desperate person on the street they encounter.

You will never, ever, see me aiding or abetting someone seeking to set up a state ruled by one man - no matter what the evil that surrounds us. And I will be very wary of the influence of those around me who may be apologists for such a solution.

An analogy might be a man who is overcome with grief to gaze upon individual suffering, such that he ignores a larger action he might take which would lead the entire mass of those suffering back into deliverance.

To apologize for a dictatorship, because you are overcome with grief at the sight of the misery in the favelas, is equivalent to shutting the door on the entire community's deliverance in any lasting sense.

I'm really quite surprised at your viewpoint.

Lukester,

To me government is useless if it allows unchecked propagation of humans and then ignores the plight of those humans. Someone has to step up and do something to help people who seem to have no chances of helping themselves. Democracy had its chance in Venezuela and had it been effective, it would still be a going concern.

On the good news front for the world population explosion that continually results in more humans without anything except the freedom to breath and copulate is the the bird flu has apparently been proven now to be transmissable from human to human. Now if it can just get off the ground, then it could solve a lot of problems for those who have nothing including hope for a better life.

Couple that with greater utilization of corn for ethanol versus food, less arable land, and the on-going wars, then perhaps population control will finally get under way, and yes, I am serious.

I'll not live to see it, but unless some catastrophe forces a change in American democracy, then eventually this country will sink to a similar level that has allowed Chavez to gain the powers he has, and something similar will happen here. It might be your grandchildren who get to see it happen.

Lukester

08-29-07, 07:20 PM

Chris -

If you admire Chavez for turning his attention to the poor, I'd highly recommend admiring Lula da Silva in Brazil instead. This is a really fine man, with a very lively intelligence and creativity, not an ideological lunk like Chavez. Brazil will take wing, while Venezuela will founder.

Lula mixes socialist programs to assist the poor with a firm bias towards free markets to encourage foreign investment. Under his wise guidance, Brazil's economy is liberalising and soaring while programs for lifting up the poorest have made more headway than they did in decades prior to his stewardship. Lula is one of a rare breed - and possibly of a breed which may be a great hope for our global future - an intelligent socialist blended with a free marketer.

Here is the eye-opening paradox which I so much admire - Lula is a hero both to the poorest, and to the middle class in Brasil. How does he do it? Above all, he is a full participant in DEMOCRACY, thereby putting the lie to the notion you have to resort to dictatorship of achieve emancipation for the desperately poor.

Look at the collapsing GDP in Venezuela - at the national petroleum company, the nation's lifeblood - now stuffed full of incompetent political cronies, with collapsing petroleum production numbers due to having booted out all the real technicians for being ideologically unreliable.

With the nation's petroleum industry collapsing to ideologically motivated mismanagement, Chavez trumpets his initiatives to buy 100,000 kalashnikovs to equip his personal militia to 'protect the nation' - Chavez and Lula da Silva - these two men are like night and day.

I mention Lula of Brasil in case you thought my objections were mere knee jerk reactions of a conservative. My objections are emphatically not of that nature. I just think the idea is a fraud upon the entire nation - that you have to force progress by allowing a man with a supposedly superior conscience for the poor, i.e. Chavez (NOT) to take over the whole show and give the poor some social justice. It's a fraud upon his nation.

Jim Nickerson

08-29-07, 08:52 PM

click the ">" to right to see link

The ludicrousness of CEO's pay made it into the news today as did the levels of compensation of hedge fund runners.

Richard Russell posted the following referenced to Bloomberg, http://www.bloomberg.com/apps/news?pid=20601103&sid=a04iBUNutMDM&refer=us

Aug. 29 (Bloomberg) -- Top private-equity and hedge fund managers made more in 10 minutes than average-paid U.S. workers earned all of last year, according to a new study from two research groups. The 20 highest-paid fund managers made an average of $657.5 million, or 22,255 times the U.S. average annual salary of $29,500, said the study, released today by Institute for Policy Studies and United for a Fair Economy. The study cited data from the U.S. Labor Department and Forbes magazine.

"The fact that these pay levels for fund managers are so out-of-sight is going to drive up pay at publicly traded companies,'' said Sarah Anderson, director of the global economy program at the Washington-based Institute for Policy Studies and a coauthor of the study. ``There are people out there with a straight face claiming that public company executives are underpaid.''

The private equity boom in the past year has pushed the pay ceiling for fund managers "further into the economic stratosphere,'' the study said.

Chief executive officers at large U.S. corporations averaged $10.8 million in pay last year, the study said, citing an Associated Press survey. Their weekly pay of $207,700 was about seven times the average worker's annual salary.

Russell Comment -- So what, welcome to capitalism. What do you want to do, legislate how much a person can make? Hey, don't complain -- you want to make $100 or $200 million a year? Go ahead, become a top money manager. It's a free country, go for it!

Then at click ">" to read beginning of "argument" regarding Chavez, socialism and poor people who failed to thrive under democracy in Venezuela.

I find it interesting that no one here sees fit to bad-mouth the thievery that is taking place in -hedge fund manager compensatin and at corporate levels of compensation in the American capitalistic system, while at least a bit of discussion/argument can be aroused over the evils of socialism as it seems to be directed to help the poor in Venezuela.

One might surmise: Corporate greed in American is not worthy of negative commentary here, while attempts to help people poorer than dirt poor of Venezuela is due derision.

Chris Coles

08-30-07, 04:30 AM

Lukester,

My first reaction is to ask you why you are so angry and aggressive about my expression of the opinion that Chavez is a basically honest person trying to do the best for his people? I can assume that most people react that way, angrily and aggressively, from fear. But of what? What are you so afraid of? May I be so bold as to say that, from the research I have done for myself, I have come to the conclusion that a lot of people have read what they have been told to believe and have not taken the trouble to discover the truth. That you fear the truth.

The truth is well set out in the film "War on democracy" and you need to realise that John Pilger is by far the most respected documentary maker here in the UK. http://www.johnpilger.com/

"which got a late night showing last week here on Independent Television. In recognition of the film's significance, ITV screened the film its entirety in the UK with only one commercial break on 20 August 2007."

"In The War on Democracy, Pilger argues that the US is doing its best to stifle the progress of democracy. The film includes an exclusive interview with President Hugo Chavez of Venezuela and former US government officials who reveal how the CIA waged covert wars in Latin America."

You need to see it. To see the woman, well dressed, standing quite still in a crowd of people who were objecting to Chavez, shot dead. Bang! right in front of the camera. Not by Chavez, or one of his supporters, or from some Chavez inspired militia, but by a group of military, supported, (Very Clearly by the White House, as the film makes VERY clear), as a means to claim that Chavez supporters were hell bent on violence and an armed overthrow of so called democracy.

Gosh knows how you are going to get to see the film as I very much doubt that any of your TV networks are going to dare to show it. That makes for a small challenge for you. I suggest that you ask for the rights to sell the DVD in the USA as a business venture and by that means get to see a copy for business verification purposes. Perhaps Eric and itulip will do that for all of you.

The distributor is Lionsgate Films (http://www.lionsgatefilms.co.uk/) which, in the UK and the US, has played a leading part in the new wave of feature-length documentaries.

The film will also be released in Australia in September by Hopscotch Films. Contact mail@hopscotch.com.au (mail@hopscotch.com.au) for more info.

But you must get hold of a copy and please, show the courage to sit down and watch it.

So how did everyone find out the truth? One of the generals involved shot his mouth off the day before to a CNN correspondent, (with integrity), and the White House involvement is clear from the timing of the announcements coming from your "official spokesman in the White House".

And please, you really need to see the subsequent interview of the CIA chiefs to get a better understanding of what has been going on in YOUR country for decades. That part of the film is quite literally sickening. I felt quite sick watching a mad man, yes, a mad man; claim the price, the murders, the mayhem.... was worth the cost.

The truth is, the United States, (I agree at only a certain level, and I do not point this at the wonderful majority of the people of the nation, but a small minority), have been going around the world and acting worse than the Nazis during the worst of WW2. That is a truth that all of you are going to have to face up to.

The last word in the film shows Chavez as a very intelligent individual making the simple statement quoting a previous world class thinker.

Watch the film. Take a few days to think through the implications and then come back and tell us the truth of your thinking.

For myself, I do not envy you, you are going to have to accept something that, if you are a civilised person, will horrify you and shake you to the core.

The CIA has been run by a bunch of complete idiots for the last sixty years and all of us out here are well past the point of any possibility of accepting any more of it. But please, do not take my word for it, see the film and find out for yourself.

Lukester

08-30-07, 12:37 PM

Hi Chris -

I have no admiration for the CIA, or our government's machinations in other countries, as I've clearly pointed out. I doubt many Americans do. You suggest my views would be different were I not laboring under delusions that the US intelligence services keep their hands clean?

Intelligence agencies the world over have little or nothing to do with ethics - to believe otherwise would be naive. What with terms like "wet ops" and "dry ops" employed by multiple intelligence agencies the world over, I think we all get the picture of their activities. US agencies are probably among the worst at this game, and I'm willing to bet they are clumsy too.

With regard to Chavez as a national leader for Venezuela, there may (or may not) be others here who might wish to add another view?

The fact that British national TV has devoted such a large effort to the burnishing of Chavez's credentials as an emancipator of the poor leaves one wondering why they ignored Lula da Silva instead.

If the purpose of the documentary is to expose the depravity of the US government's foreign interventions (a very timely topic), then burnishing Chavez's reputation would seem a fertile exercise in promoting that idea. If the purpose of such a documentary were to explore the best experiments in socialism combined with free market practice in central and south America (perhaps a more promising national experiment) then the fact Lula da Silva was overlooked is quite remarkable.

My suggestion to you is that a journalistic investigation of hopeful new avenues for Socialism as a functioning and hopeful national experiment was not the exercise here.

One of the above documentaries could be advancing an investigation of the birth of modern socialism with free market principles in South America - a very solid and intriguing news story. The actual documentary suggests it is more focused on advancing the author's own views regarding the regrettability of US intervention in Venezuela.

That is certainly a valid topic, and indeed very timely and self-evident. What it should not do in the process, is lionize a man (Chavez) who's concept of a 21st Century experiment in Socialism seems to be drawing it's inspiration quite unimaginatively from now quite threadbare early 20th Century examples.

If Chavez is raised to the stature of "statesman" or "enlightened leader" in this documenatary, then that in my view is considerably above what he merits. The reason he does not merit it is because he is quite patently engaged in demolishing the system of constitutional safeguards which were designed expressly to prevent one man with considerable ambition to power from gaining lifetime supremacy within their government. If your prime minister suddenly engaged in a ruthless campaign to browbeat your parliament to assign him prime minister for life, doubtless you'd object?

What I look at with considerable concern within your own views Chris, is that you don't seem to translate your presumed displeasure at your own government attempting such a thing into equally principled displeasure at the sight of such browbeating for Presidential term limits being scrapped today in Venezuela - which is precisely what Chavez is engaged in. It's food for thought, isn't it?

Seems the primary purpose of the documentary, to decry US intervention, is certainly accomplished - and I have no disagreement whatsoever with the validity of such a documentary. Another documentary could focus on the paradox of Chavez genuinely implementing groundbreaking programs for the poor, yet at the same time systematically dismantling the constitutional multi-party state. This would be a fascinating documentary.

Even were the documentary more focused on the regrettability of US intervention, I'd find it straightforward, and look for it with a good deal more interest. Any documentary which burnishes Chavez as a principled leader in the process of leveling critique at American foreign policy however has immediately compromised it's objectivity in my view. Chaves is a thug, and you have only to pick up international papers such as the Times of London and follow his antics in attempting to repeal constitutional safeguards limiting one man's power to rule Venezuela without democratic checks and balances to see it plainly.

You are a citizen of the world's oldest Parliamentary democracy Chris. I urge you to reflect further upon that wonderful legacy and take cognizance of which of it's principles you may (or may not) consider inviolable for all other nations. To imagine you can firmly uphold those principles within your own government, yet dispense with them in prescriptions for other governments, carries the risk of a double standard.

bart

08-30-07, 01:46 PM

...
With regard to Chavez as a national leader for Venezuela, there may (or may not) be others here who might wish to add another view?
...

I say that you and Chris go after each other on if Chavez is bipolar or not... ;)

My only serious comments are this interesting quote:

"In politics, nothing happens by accident. If it happens, you can bet it was planned that way."
-- Franklin D. Roosevelt

and a reminder that socialism is basically defined *in practice* as a wealth transfer system too.

"The inherent vice of capitalism is the unequal sharing of the blessings. The inherent blessing of socialism is the equal sharing of misery."
-- Winston Churchill

Chris Coles

08-30-07, 02:47 PM

You are of course both right. The problem is that Capitalism has not lifted the greater masses from the sort of desperate struggle none of us have any experience of in places like Venezuela. Moreover, where they try and lift themselves using whatever seems to work for them, by voting for something different... they did vote for Chavez you know, then others say either you stick to what we have defined as freedom, (that clearly does not deliver), or we will do everything we can to destroy you and the experiment.

But that is precisely the point. Democracy is not about one system, it is about the people voting for a new leader and, if that is what they want, a new system.

It is not the institutions that have primacy in any democracy, it is the people and their right to vote for whatever they wish. For example, I am trying to take a feudal nation, yes, feudal nation called the United Kingdom and change it to a Free Enterprise one. I can claim to have had some effect as our Department for Industry is now called the department for Enterprise. Not that anyone will admit to any input from me.

Your problem is that you believe that it is the institutions that have primacy, not the ordinary people. And thus that if the people vote for something with which you disagree, you feel you have the right to take up a gun and kill them.

That is anarchy, not any form of democracy. Using the gun is plain murder, a criminal offence in any society.

Turning to an agreed lack of ethics with the likes of the CIA, there is a world of difference between doing anything to survive being caught obtaining information and setting out to deliberately murder the people of any other nation just because you do not like the particular system they have decided to vote for in an election. One is understandable, the other is as much a murder as any other and murderers are not acceptable people in any civilised society. If, as it appears you have in the United States, give any form of credibility to any government employed murderer and promote them to a high level and pay them to continue, you destroy your credibility as a nation.

In that case your nations credibility is destroyed, your institutions are ultra Vires, lawless. Like any individual, a nation can take a lifetime to build up a good reputation and destroy it in a blink of an eye.

You keep your gun in sight and tell everyone that, threatened, you will use it. That is totally acceptable. But the moment you take the gun in hand and walk down the street of the next town and start killing that towns people in the street claiming that they have voted for a system in which you disagree, you simply become a sad fool and a murderer.

Nothing you can do from that moment on-wards will change the facts of your criminality. Sadly the CIA thought that they could get away with that sort of thing simply because they had friends in the institutions of the nation that would always "protect" them.

You cannot protect a murderer without becoming complicit in the murders yourself; that is the law in any civilised society.

Chavez may well not be able to deliver the hoped for institutions, but that is for the people of his nation to decide for themselves. By trying a new path, they might find a completely new set of ways for a peaceful society to live by. What right has anyone outside that nation to murder them for trying? I will go to my grave arguing that no one has that right.

No one!

Rajiv

08-30-07, 03:03 PM

You keep your gun in sight and tell everyone that, threatened, you will use it. That is totally acceptable. But the moment you take the gun in hand and walk down the street of the next town and start killing that towns people in the street claiming that they have voted for a system in which you disagree, you simply become a sad fool and a murderer.

Nothing you can do from that moment on-wards will change the facts of your criminality.

You cannot protect a murderer without becoming complicit in the murders yourself; that is the law in any civilised society.

An article by Paul Craig Roberts appears to highlight your point of view. In "More shame, more sorrow (http://onlinejournal.com/artman/publish/article_2362.shtml)" he says

In the administration of George W. Bush, the Republican Party has achieved the greatest combination of idiocy and evil in human history.

The Republicans have bogged America down in a gratuitous and illegal war. The war has destroyed Iraq, killed between 650,000 and 1,000,000 Iraqi civilians, displaced 4,000,000 Iraqis, and littered the country with depleted uranium. Bush's war remains unwon despite its five-year duration and $1 trillion in out-of-pocket and incurred future costs.

Bush's invasion of Iraq is a war crime under the Nuremberg standard, a direct counterpart to Hitler's invasion of Poland. Both were based on lies and deception, and the declared reasons for both were masks for secret agendas.

Bush's invasions of Afghanistan and Iraq, his planned attack on Iran, and his support for Israel's attack on Lebanon and genocidal policies toward the Palestinians have radicalized the Middle East and Muslims worldwide.
.
.
In the postwar years, the US managed with its money and influence to secularize an elite class in Middle Eastern countries, an elite that identifies with the West and not with their own cultures. This artificial elite has produced a wide political gap between the masses of the people and the rulers. Increasingly, Muslim masses perceive their rulers as allied with foreign powers against them.

If I look at Chavez and Lula -- this is what they see of the US and US policy. And hence the intense antipathy towards the US -- only Lula is better able to mask that feeling -- but I would not blame Chavez for that - he after all has been targeted for elimination by the US policy makers.

Lukester

08-30-07, 07:37 PM

Rajiv -

<< <TABLE cellSpacing=0 cellPadding=6 width="100%" border=0><TBODY><TR><TD class=alt2 style="BORDER-RIGHT: 1px inset; BORDER-TOP: 1px inset; BORDER-LEFT: 1px inset; BORDER-BOTTOM: 1px inset">In the administration of George W. Bush, the Republican Party (http://amazon.com/gp/product/0896084191?ie=UTF8&tag=wwwitulipcom-20&link_code=em1&camp=212341&creative=384049&creativeASIN=0896084191&adid=e284ca56-53e3-44e6-91b8-3b8db2924e6c) has achieved the greatest combination of idiocy and evil in human history.</TD></TR></TBODY></TABLE> >>

This is getting carried away with some absurd hyperbole - the quote makes no distinction between George W. Bush's intervention to oust Saddam and the wholesale systematic terror for terror's own sake of the likes of Stalin, Mao Tse Tung, Hitler, Pol Pot, Idi Amin, the Spanish Inquisitors, Ghengis Khan, or any of an entire host of men personally responsible for intentionally consigning millions to the more gruesome and imaginatively devised deaths - the above are men who actively and very pragmatically perfected the practice of imposing mass civilian terror as an ordinary daily tool of government.

I'm no Bush fan. I'll readily acknowledge this US president's intervention was bloody, ill advised, was ill executed, and has put some blood directly on it's hands to answer for - but it falls so far short of the above cast of characters in motivation and degree, as to make the comparison to them merely rhetorical nonsense.

The objectivity of your quoted author is badly compromised by glossing completely over the fact that 80% of all of deaths in Iraq resulting from this admittedly misguided and illegitimate war are MUSLIM on MUSLIM.

Where does this author lay due emphasis on the acknowledgement (any aknowledgement?) that these are not US instigated deaths?

Those actively carrying out, in 2006 and 2007, fully 90%++ of these deaths, are executing this activity of "resistance" with all the systematic efficiency of an industrial process. Their actions to sow mass death are premeditated, well planned, and executed in numbers of an almost industrial scale, almost solely upon civilians. These actors are the so called 'resistance' - who use the blowing up of civilians as a propaganda tool.

Calling these people a 'resistance' is like putting lipstick on a severed pig's head and calling it a thing of beauty. How do we choose to spell the true ongoing W.A.R. C.R.I.M.E.S. ? Whoever turns their gaze away from these, while shaking an indignant finger at the US, is turning a blind eye to some very industrious agents of death today!

The uncomfortable fact for those seeking a straightforward world of clear morality where good players and bad players are clearly lined up, is that it's a considerable minority of deaths in Iraq which are directly attributable to direct coalition armed force. Yes, tally up the civilian deaths recorded in bombings and executions in the past couple of years! What an eye opener!

Enlisted soldiers know if they shoot civilians without cause they run the risk of standing in a court martial. As a deterrent, it is not perfect, but you can safely assume it keeps such actions down to such a small level as a percentage of all the deaths going on, that claiming soldiers account for "a million non-combatant civilian deaths" is patent nonsense.

I do not approve of people who will willfully manipulate the statistics of death in the service of an ideological position. Civilian death is civilian death - those responsible for the most willfull methods of inflicting it, or causing the greatest number of deaths, must be clearly acknowledged.

Muslim on Muslim death is overwhelmingly and by far the largest cause of death in Iraq, and has been for years.

Whoever points primary blame directly at US forces and pointedly ignores the various Sunni and Shia groups who have been carrying out the majority of mass killing, is laying claim to morality while standing on a fairly shaky soapbox, in my view.

These groups are actively sabotaging sincere US Military efforts to acquit themselves with some scrap of decency at least in an exit plan. US Military have struggled with having to execute the seriously misguided policies of a US government which has been utterly inept in it's assessment of realizable goals after Saddam.

Critics such as the author quoted above turn a willful blind eye on the fact that US efforts have for several years been entirely directed at securing the cessation of more deaths. The slant of this viewpoint is further evident in remaining pointedly silent about those opposing groups in Iraq who are actively causing more massive civilian deaths, as a means to hasten or assure US departure. Such 'journalists' are making some very precarious moral arguments now indeed.

To gloss over an urgently needed examinaton of the cause and agents of present massive death statistics, out of mere dislike for the US, exhibits an astonishing degree of moral superficiality.

I'll repeat it: Muslim on Muslim death is overwhelmingly the direct cause of death in Iraq, and has been for years. Where are the acknowledgements, or condemnation of these actors, from this "journalist"?

US occupation may have been the destabilizing agent precipitating these developments - but it is not the direct agent of the 100's of civilian's being blown up weekly in the marketplace or mosque or even the elementary school, by these 'resistance' fighters.

Rajiv you are a very subtle and intelligent voice on these forums - I read everything you post with interest and appreciation - but any journalist writing articles claiming the US is directly responsible for "a million deaths in Iraq" should have their nose rubbed in the bloody shards of "resistance fighter" planted bombs and be asked to take a real moral position regarding 80% of the deaths.

It's possible to put together much more powerful critiques of the US intervention in Iraq precisely by steering well clear of those commentators who abdicated their role as objective reporters, by throwing such wildly slanted and ideologically shrill numbers around.

These are AL QUAEDA deaths - inflicted on civilians. Alternatively they are Sunni on Shia, or Shia on Sunni deaths. The Kurds, bless them, seem to be more intent on building their society back up, and it seems too much to ask critics of the US to take note, that the Kurds have excellent relations with the US.

If such authors ever had the intellectual integrity to get off their narrow minded rickety soapboxes, take a factual look around at who is dying in great numbers and why, and clearly condemn THOSE Muslim on Muslim deaths, they would win my full support in their subsequent critique of US intervention.

The problem is, there seems a curious shortage in each ideological camp of people willing to frankly weigh up each side of the issue. In the community of overwrought critics of this war, few if any journalists can find the balance to point out the Muslim on Muslim violence is by far the largest cause of the butchery.

And Rajiv, with regard to Chavez and Lula - to lump them together and suggest Lula is merely more circumspect in his loathing of what you take to be an utterly irredeemable US - is I think completely missing the profound differences between these two. Lula may not have any great love for the US, but above all he is a pragmatist much more interested in economic growth along real rather than fantasy lines.

Lula could be transplanted to Europe and blend right in as a center left politician - and a quite decent one at that. He is nothing remotely like Chavez in vision or motivations.

Chavez is in fiscal, ideological and economic terms, living in a world of such fantasy that he views Venezuela's petroleum endowment as a tool to be consumed within his life-term alone, for buying Mercosur votes for him personally, for buying Venezuelan cronies, and for casting a wider influence upon the world stage. The man is utterly wrapped up in ego, has zero of an economic plan, and will run Venezuela right into the ditch. They have one of the richest endowments of resources in all the Americas - and under Chavez will run into the ditch regardless.

An careful observer may take note that Chavez and Lula are vast distances apart. One is yet another dreary example of a tinpot dictator busily shoring up his goon squads while he dismantles the parliamentary system feebly opposing him, the other has the real makings of a Brasilian statesman.

Seems you and I have a diametrically different understanding of practically all of these topics Rajiv. Please pardon my wholehearted disagreement with you here.

Rajiv

08-30-07, 08:01 PM

We will just have to agree to disagree on this issue.

Chris Coles

08-31-07, 03:14 AM

Today, I feel a little like the boy who has thrown a pebble and caused a tidal wave, except that I am but one of millions who, having watched and learned, has seen the need for change and, for myself, believe that to stand and do nothing is to make myself complicit in the crimes described, have decided, as a part of the rest of my life's work, to speak out.

Earlier this week we heard about the resignation of Gonzales.

I got this comment put up in The Times London: http://www.timesonline.co.uk/tol/news/world/us_and_americas/article2337339.ece?EMC-Bltn

"The resignation is but one part of the solution to the overriding problem of political interference in matters of the law. It is absolutely imperative that all the political mechanisms, (that are in place and that were and are still in use), that allowed political interference to take place; are permanently removed from the statute book. Until Congress faces the reality and makes these changes, no one with an open mind can call the United States a free country.

Political interference in the law is an internationally recognised hallmark of a broken society.

Chris Coles, Medstead, Alton, United Kingdom"

Everyone of us that can see the dreadful mistakes has a duty to speak out. Those of you that have yet to gather a complete understanding of the facts has an absolute responsibility to find out the truth and follow the debate.

I do sometimes wonder how much angst would never have happened if the CIA had never been born. That instead of a policy of setting out to destroy by arms budding new societies, the United States had instead set out to work with all their people to find ways of trading with them, peacefully.

Or, have you all forgotten the wonderful films Hollywood made in the likes of the Middle East and South America before and during the second world war? Dig out the old black and white movies and tell me the people surrounding the film crews posed a desperate threat to the United States.

Not one.

Chris Coles

08-31-07, 04:05 AM

Lukester,

You are not looking at what is being put in front of you. The "journalist" is:

Paul Craig Roberts [email him (paulcraigroberts@yahoo.com)]was Assistant Secretary of the Treasury in the Reagan Administration. He is the author of Supply-Side Revolution : An Insider's Account of Policymaking in Washington (http://www.amazon.com/gp/product/067485621X/103-9747828-0329461); Alienation and the Soviet Economy (http://www.amazon.com/gp/product/0945999631/002-8915021-8428856?n=283155) and Meltdown: Inside the Soviet Economy (http://www.amazon.com/gp/product/0932790801/002-8915021-8428856?n=283155), and is the co-author with Lawrence M. Stratton ofThe Tyranny of Good Intentions : How Prosecutors and Bureaucrats Are Trampling the Constitution in the Name of Justice (http://www.amazon.com/exec/obidos/redirect?tag=vdare&creative=373489&camp=211189&link_code=as3&path=ASIN/076152553X). Click here (http://www.vdare.com/pb/death_of_due_process.htm) for Peter Brimelow’s Forbes Magazine interview with Roberts about the recent epidemic of prosecutorial misconduct.

By far the majority of killings during the WW2 years in Germany were German on German. One sect killing any others they disliked such as Jews and Romanies. One man set the whole thing into motion and the nett result was that anyone with a mind to set out to murder who they wished for the simple reason the original act opened up the possibility of a breakdown of law.

If you want a more modern parallel, take a look at the record of the attacks on Palestinians after they had been herded into camps, particularly during the 1950,s and 1960's.

You keep looking back to other times without realising that the United States has been regularly complicit in the same things since the end of hostilities in Europe.

Try this for size. This man is perhaps Englands finest playright since Shakespere. Harold Pinter.

Listen to him on DVD or as here, you can read what he had to say in his Nobel Prize lecture.

http://www.channel4.com/more4/event/P/pinter.html

Do not dare to come back and barrack us more without reading it in full.

As I am sure the Nobel Prize organization will not mind my putting it up on itulip, here it is.



http://www.channel4.com/more4/media/images/events/P/pinter_228x120.jpg
Harold Pinter

Wed 7 Dec 2005
Harold Pinter delivers his Nobel Prize for literature acceptance speech live from Stockholm.
Harold Pinter – Nobel Lecture; on 'Art, Truth and Politics'

"In 1958 I wrote the following:

'There are no hard distinctions between what is real and what is unreal, nor between what is true and what is false. A thing is not necessarily either true or false; it can be both true and false.'

I believe that these assertions still make sense and do still apply to the exploration of reality through art. So as a writer I stand by them but as a citizen I cannot. As a citizen I must ask: What is true? What is false?

Truth in drama is forever elusive. You never quite find it but the search for it is compulsive. The search is clearly what drives the endeavour. The search is your task. More often than not you stumble upon the truth in the dark, colliding with it or just glimpsing an image or a shape which seems to correspond to the truth, often without realising that you have done so. But the real truth is that there never is any such thing as one truth to be found in dramatic art. There are many. These truths challenge each other, recoil from each other, reflect each other, ignore each other, tease each other, are blind to each other. Sometimes you feel you have the truth of a moment in your hand, then it slips through your fingers and is lost.

I have often been asked how my plays come about. I cannot say. Nor can I ever sum up my plays, except to say that this is what happened. That is what they said. That is what they did.

Most of the plays are engendered by a line, a word or an image. The given word is often shortly followed by the image. I shall give two examples of two lines which came right out of the blue into my head, followed by an image, followed by me.

The plays are The Homecoming and Old Times. The first line of The Homecoming is 'What have you done with the scissors?' The first line of Old Times is 'Dark.'

In each case I had no further information.

In the first case someone was obviously looking for a pair of scissors and was demanding their whereabouts of someone else he suspected had probably stolen them. But I somehow knew that the person addressed didn't give a damn about the scissors or about the questioner either, for that matter.

'Dark' I took to be a description of someone's hair, the hair of a woman, and was the answer to a question. In each case I found myself compelled to pursue the matter. This happened visually, a very slow fade, through shadow into light.

I always start a play by calling the characters A, B and C.

In the play that became The Homecoming I saw a man enter a stark room and ask his question of a younger man sitting on an ugly sofa reading a racing paper. I somehow suspected that A was a father and that B was his son, but I had no proof. This was however confirmed a short time later when B (later to become Lenny) says to A (later to become Max), 'Dad, do you mind if I change the subject? I want to ask you something. The dinner we had before, what was the name of it? What do you call it? Why don't you buy a dog? You're a dog cook. Honest. You think you're cooking for a lot of dogs.' So since B calls A 'Dad' it seemed to me reasonable to assume that they were father and son. A was also clearly the cook and his cooking did not seem to be held in high regard. Did this mean that there was no mother? I didn't know. But, as I told myself at the time, our beginnings never know our ends.

'Dark.' A large window. Evening sky. A man, A (later to become Deeley), and a woman, B (later to become Kate), sitting with drinks. 'Fat or thin?' the man asks. Who are they talking about? But I then see, standing at the window, a woman, C (later to become Anna), in another condition of light, her back to them, her hair dark.

It's a strange moment, the moment of creating characters who up to that moment have had no existence. What follows is fitful, uncertain, even hallucinatory, although sometimes it can be an unstoppable avalanche. The author's position is an odd one. In a sense he is not welcomed by the characters. The characters resist him, they are not easy to live with, they are impossible to define. You certainly can't dictate to them. To a certain extent you play a never-ending game with them, cat and mouse, blind man's buff, hide and seek. But finally you find that you have people of flesh and blood on your hands, people with will and an individual sensibility of their own, made out of component parts you are unable to change, manipulate or distort.

So language in art remains a highly ambiguous transaction, a quicksand, a trampoline, a frozen pool which might give way under you, the author, at any time.

But as I have said, the search for the truth can never stop. It cannot be adjourned, it cannot be postponed. It has to be faced, right there, on the spot.

Political theatre presents an entirely different set of problems. Sermonising has to be avoided at all cost. Objectivity is essential. The characters must be allowed to breathe their own air. The author cannot confine and constrict them to satisfy his own taste or disposition or prejudice. He must be prepared to approach them from a variety of angles, from a full and uninhibited range of perspectives, take them by surprise, perhaps, occasionally, but nevertheless give them the freedom to go which way they will. This does not always work. And political satire, of course, adheres to none of these precepts, in fact does precisely the opposite, which is its proper function.

In my play The Birthday Party I think I allow a whole range of options to operate in a dense forest of possibility before finally focussing on an act of subjugation.

Mountain Language pretends to no such range of operation. It remains brutal, short and ugly. But the soldiers in the play do get some fun out of it. One sometimes forgets that torturers become easily bored. They need a bit of a laugh to keep their spirits up. This has been confirmed of course by the events at Abu Ghraib in Baghdad. Mountain Language lasts only 20 minutes, but it could go on for hour after hour, on and on and on, the same pattern repeated over and over again, on and on, hour after hour.

Ashes to Ashes, on the other hand, seems to me to be taking place under water. A drowning woman, her hand reaching up through the waves, dropping down out of sight, reaching for others, but finding nobody there, either above or under the water, finding only shadows, reflections, floating; the woman a lost figure in a drowning landscape, a woman unable to escape the doom that seemed to belong only to others.

But as they died, she must die too.

Political language, as used by politicians, does not venture into any of this territory since the majority of politicians, on the evidence available to us, are interested not in truth but in power and in the maintenance of that power. To maintain that power it is essential that people remain in ignorance, that they live in ignorance of the truth, even the truth of their own lives. What surrounds us therefore is a vast tapestry of lies, upon which we feed.

As every single person here knows, the justification for the invasion of Iraq was that Saddam Hussein possessed a highly dangerous body of weapons of mass destruction, some of which could be fired in 45 minutes, bringing about appalling devastation. We were assured that was true. It was not true. We were told that Iraq had a relationship with Al Quaeda and shared responsibility for the atrocity in New York of September 11th 2001. We were assured that this was true. It was not true. We were told that Iraq threatened the security of the world. We were assured it was true. It was not true.

The truth is something entirely different. The truth is to do with how the United States understands its role in the world and how it chooses to embody it.

But before I come back to the present I would like to look at the recent past, by which I mean United States foreign policy since the end of the Second World War. I believe it is obligatory upon us to subject this period to at least some kind of even limited scrutiny, which is all that time will allow here.

Everyone knows what happened in the Soviet Union and throughout Eastern Europe during the post-war period: the systematic brutality, the widespread atrocities, the ruthless suppression of independent thought. All this has been fully documented and verified.

But my contention here is that the US crimes in the same period have only been superficially recorded, let alone documented, let alone acknowledged, let alone recognised as crimes at all. I believe this must be addressed and that the truth has considerable bearing on where the world stands now. Although constrained, to a certain extent, by the existence of the Soviet Union, the United States' actions throughout the world made it clear that it had concluded it had carte blanche to do what it liked.

Direct invasion of a sovereign state has never in fact been America's favoured method. In the main, it has preferred what it has described as 'low intensity conflict'. Low intensity conflict means that thousands of people die but slower than if you dropped a bomb on them in one fell swoop. It means that you infect the heart of the country, that you establish a malignant growth and watch the gangrene bloom. When the populace has been subdued – or beaten to death – the same thing – and your own friends, the military and the great corporations, sit comfortably in power, you go before the camera and say that democracy has prevailed. This was a commonplace in US foreign policy in the years to which I refer.

The tragedy of Nicaragua was a highly significant case. I choose to offer it here as a potent example of America's view of its role in the world, both then and now.

I was present at a meeting at the US embassy in London in the late 1980s.

The United States Congress was about to decide whether to give more money to the Contras in their campaign against the state of Nicaragua. I was a member of a delegation speaking on behalf of Nicaragua but the most important member of this delegation was a Father John Metcalf. The leader of the US body was Raymond Seitz (then number two to the ambassador, later ambassador himself). Father Metcalf said: 'Sir, I am in charge of a parish in the north of Nicaragua. My parishioners built a school, a health centre, a cultural centre. We have lived in peace. A few months ago a Contra force attacked the parish. They destroyed everything: the school, the health centre, the cultural centre. They raped nurses and teachers, slaughtered doctors, in the most brutal manner. They behaved like savages. Please demand that the US government withdraw its support from this shocking terrorist activity.'

Raymond Seitz had a very good reputation as a rational, responsible and highly sophisticated man. He was greatly respected in diplomatic circles. He listened, paused and then spoke with some gravity. 'Father,' he said, 'let me tell you something. In war, innocent people always suffer.' There was a frozen silence. We stared at him. He did not flinch.

Innocent people, indeed, always suffer.

Finally somebody said: 'But in this case “innocent people” were the victims of a gruesome atrocity subsidised by your government, one among many. If Congress allows the Contras more money further atrocities of this kind will take place. Is this not the case? Is your government not therefore guilty of supporting acts of murder and destruction upon the citizens of a sovereign state?'

Seitz was imperturbable. 'I don't agree that the facts as presented support your assertions,' he said.

As we were leaving the Embassy a US aide told me that he enjoyed my plays. I did not reply.

I should remind you that at the time President Reagan made the following statement: 'The Contras are the moral equivalent of our Founding Fathers.'

The United States supported the brutal Somoza dictatorship in Nicaragua for over 40 years. The Nicaraguan people, led by the Sandinistas, overthrew this regime in 1979, a breathtaking popular revolution.

The Sandinistas weren't perfect. They possessed their fair share of arrogance and their political philosophy contained a number of contradictory elements. But they were intelligent, rational and civilised. They set out to establish a stable, decent, pluralistic society. The death penalty was abolished. Hundreds of thousands of poverty-stricken peasants were brought back from the dead. Over 100,000 families were given title to land. Two thousand schools were built. A quite remarkable literacy campaign reduced illiteracy in the country to less than one seventh. Free education was established and a free health service. Infant mortality was reduced by a third. Polio was eradicated.

The United States denounced these achievements as Marxist/Leninist subversion. In the view of the US government, a dangerous example was being set. If Nicaragua was allowed to establish basic norms of social and economic justice, if it was allowed to raise the standards of health care and education and achieve social unity and national self respect, neighbouring countries would ask the same questions and do the same things. There was of course at the time fierce resistance to the status quo in El Salvador.

I spoke earlier about 'a tapestry of lies' which surrounds us. President Reagan commonly described Nicaragua as a 'totalitarian dungeon'. This was taken generally by the media, and certainly by the British government, as accurate and fair comment. But there was in fact no record of death squads under the Sandinista government. There was no record of torture. There was no record of systematic or official military brutality. No priests were ever murdered in Nicaragua. There were in fact three priests in the government, two Jesuits and a Maryknoll missionary. The totalitarian dungeons were actually next door, in El Salvador and Guatemala. The United States had brought down the democratically elected government of Guatemala in 1954 and it is estimated that over 200,000 people had been victims of successive military dictatorships.

Six of the most distinguished Jesuits in the world were viciously murdered at the Central American University in San Salvador in 1989 by a battalion of the Alcatl regiment trained at Fort Benning, Georgia, USA. That extremely brave man Archbishop Romero was assassinated while saying mass. It is estimated that 75,000 people died. Why were they killed? They were killed because they believed a better life was possible and should be achieved. That belief immediately qualified them as communists. They died because they dared to question the status quo, the endless plateau of poverty, disease, degradation and oppression, which had been their birthright.

The United States finally brought down the Sandinista government. It took some years and considerable resistance but relentless economic persecution and 30,000 dead finally undermined the spirit of the Nicaraguan people. They were exhausted and poverty stricken once again. The casinos moved back into the country. Free health and free education were over. Big business returned with a vengeance. 'Democracy' had prevailed.

But this 'policy' was by no means restricted to Central America. It was conducted throughout the world. It was never-ending. And it is as if it never happened.

The United States supported and in many cases engendered every right wing military dictatorship in the world after the end of the Second World War. I refer to Indonesia, Greece, Uruguay, Brazil, Paraguay, Haiti, Turkey, the Philippines, Guatemala, El Salvador, and, of course, Chile. The horror the United States inflicted upon Chile in 1973 can never be purged and can never be forgiven.

Hundreds of thousands of deaths took place throughout these countries. Did they take place? And are they in all cases attributable to US foreign policy? The answer is yes they did take place and they are attributable to American foreign policy. But you wouldn't know it.

It never happened. Nothing ever happened. Even while it was happening it wasn't happening. It didn't matter. It was of no interest. The crimes of the United States have been systematic, constant, vicious, remorseless, but very few people have actually talked about them. You have to hand it to America. It has exercised a quite clinical manipulation of power worldwide while masquerading as a force for universal good. It's a brilliant, even witty, highly successful act of hypnosis.

I put to you that the United States is without doubt the greatest show on the road. Brutal, indifferent, scornful and ruthless it may be but it is also very clever. As a salesman it is out on its own and its most saleable commodity is self love. It's a winner. Listen to all American presidents on television say the words, 'the American people', as in the sentence, 'I say to the American people it is time to pray and to defend the rights of the American people and I ask the American people to trust their president in the action he is about to take on behalf of the American people.'

It's a scintillating stratagem. Language is actually employed to keep thought at bay. The words 'the American people' provide a truly voluptuous cushion of reassurance. You don't need to think. Just lie back on the cushion. The cushion may be suffocating your intelligence and your critical faculties but it's very comfortable. This does not apply of course to the 40 million people living below the poverty line and the 2 million men and women imprisoned in the vast gulag of prisons, which extends across the US.

The United States no longer bothers about low intensity conflict. It no longer sees any point in being reticent or even devious. It puts its cards on the table without fear or favour. It quite simply doesn't give a damn about the United Nations, international law or critical dissent, which it regards as impotent and irrelevant. It also has its own bleating little lamb tagging behind it on a lead, the pathetic and supine Great Britain.

What has happened to our moral sensibility? Did we ever have any? What do these words mean? Do they refer to a term very rarely employed these days – conscience? A conscience to do not only with our own acts but to do with our shared responsibility in the acts of others? Is all this dead? Look at Guantanamo Bay. Hundreds of people detained without charge for over three years, with no legal representation or due process, technically detained forever. This totally illegitimate structure is maintained in defiance of the Geneva Convention. It is not only tolerated but hardly thought about by what's called the 'international community'. This criminal outrage is being committed by a country, which declares itself to be 'the leader of the free world'. Do we think about the inhabitants of Guantanamo Bay? What does the media say about them? They pop up occasionally – a small item on page six. They have been consigned to a no man's land from which indeed they may never return. At present many are on hunger strike, being force-fed, including British residents. No niceties in these force-feeding procedures. No sedative or anaesthetic. Just a tube stuck up your nose and into your throat. You vomit blood. This is torture. What has the British Foreign Secretary said about this? Nothing. What has the British Prime Minister said about this? Nothing. Why not? Because the United States has said: to criticise our conduct in Guantanamo Bay constitutes an unfriendly act. You're either with us or against us. So Blair shuts up.

The invasion of Iraq was a bandit act, an act of blatant state terrorism, demonstrating absolute contempt for the concept of international law. The invasion was an arbitrary military action inspired by a series of lies upon lies and gross manipulation of the media and therefore of the public; an act intended to consolidate American military and economic control of the Middle East masquerading – as a last resort – all other justifications having failed to justify themselves – as liberation. A formidable assertion of military force responsible for the death and mutilation of thousands and thousands of innocent people.

We have brought torture, cluster bombs, depleted uranium, innumerable acts of random murder, misery, degradation and death to the Iraqi people and call it 'bringing freedom and democracy to the Middle East'.

How many people do you have to kill before you qualify to be described as a mass murderer and a war criminal? One hundred thousand? More than enough, I would have thought. Therefore it is just that Bush and Blair be arraigned before the International Criminal Court of Justice. But Bush has been clever. He has not ratified the International Criminal Court of Justice. Therefore if any American soldier or for that matter politician finds himself in the dock Bush has warned that he will send in the marines. But Tony Blair has ratified the Court and is therefore available for prosecution. We can let the Court have his address if they're interested. It is Number 10, Downing Street, London.

Death in this context is irrelevant. Both Bush and Blair place death well away on the back burner. At least 100,000 Iraqis were killed by American bombs and missiles before the Iraq insurgency began. These people are of no moment. Their deaths don't exist. They are blank. They are not even recorded as being dead. 'We don't do body counts,' said the American general Tommy Franks.

Early in the invasion there was a photograph published on the front page of British newspapers of Tony Blair kissing the cheek of a little Iraqi boy. 'A grateful child,' said the caption. A few days later there was a story and photograph, on an inside page, of another four-year-old boy with no arms. His family had been blown up by a missile. He was the only survivor. 'When do I get my arms back?' he asked. The story was dropped. Well, Tony Blair wasn't holding him in his arms, nor the body of any other mutilated child, nor the body of any bloody corpse. Blood is dirty. It dirties your shirt and tie when you're making a sincere speech on television.

The 2,000 American dead are an embarrassment. They are transported to their graves in the dark. Funerals are unobtrusive, out of harm's way. The mutilated rot in their beds, some for the rest of their lives. So the dead and the mutilated both rot, in different kinds of graves.

Here is an extract from a poem by Pablo Neruda, 'I'm Explaining a Few Things':

And one morning all that was burning,
one morning the bonfires
leapt out of the earth
devouring human beings
and from then on fire,
gunpowder from then on,
and from then on blood.
Bandits with planes and Moors,
bandits with finger-rings and duchesses,
bandits with black friars spattering blessings
came through the sky to kill children
and the blood of children ran through the streets
without fuss, like children's blood.

Jackals that the jackals would despise
stones that the dry thistle would bite on and spit out,
vipers that the vipers would abominate.

Face to face with you I have seen the blood
of Spain tower like a tide
to drown you in one wave
of pride and knives.

Treacherous
generals:
see my dead house,
look at broken Spain:
from every house burning metal flows
instead of flowers
from every socket of Spain
Spain emerges
and from every dead child a rifle with eyes
and from every crime bullets are born
which will one day find
the bull's eye of your hearts.

And you will ask: why doesn't his poetry
speak of dreams and leaves
and the great volcanoes of his native land.

Come and see the blood in the streets.
Come and see
the blood in the streets.
Come and see the blood
in the streets!*

Let me make it quite clear that in quoting from Neruda's poem I am in no way comparing Republican Spain to Saddam Hussein's Iraq. I quote Neruda because nowhere in contemporary poetry have I read such a powerful visceral description of the bombing of civilians.

I have said earlier that the United States is now totally frank about putting its cards on the table. That is the case. Its official declared policy is now defined as 'full spectrum dominance'. That is not my term, it is theirs. 'Full spectrum dominance' means control of land, sea, air and space and all attendant resources.

The United States now occupies 702 military installations throughout the world in 132 countries, with the honourable exception of Sweden, of course. We don't quite know how they got there but they are there all right.

The United States possesses 8,000 active and operational nuclear warheads. Two thousand are on hair trigger alert, ready to be launched with 15 minutes warning. It is developing new systems of nuclear force, known as bunker busters. The British, ever cooperative, are intending to replace their own nuclear missile, Trident. Who, I wonder, are they aiming at? Osama bin Laden? You? Me? Joe Dokes? China? Paris? Who knows? What we do know is that this infantile insanity – the possession and threatened use of nuclear weapons – is at the heart of present American political philosophy. We must remind ourselves that the United States is on a permanent military footing and shows no sign of relaxing it.

Many thousands, if not millions, of people in the United States itself are demonstrably sickened, shamed and angered by their government's actions, but as things stand they are not a coherent political force – yet. But the anxiety, uncertainty and fear which we can see growing daily in the United States is unlikely to diminish.

I know that President Bush has many extremely competent speech writers but I would like to volunteer for the job myself. I propose the following short address which he can make on television to the nation. I see him grave, hair carefully combed, serious, winning, sincere, often beguiling, sometimes employing a wry smile, curiously attractive, a man's man.

'God is good. God is great. God is good. My God is good. Bin Laden's God is bad. His is a bad God. Saddam's God was bad, except he didn't have one. He was a barbarian. We are not barbarians. We don't chop people's heads off. We believe in freedom. So does God. I am not a barbarian. I am the democratically elected leader of a freedom-loving democracy. We are a compassionate society. We give compassionate electrocution and compassionate lethal injection. We are a great nation. I am not a dictator. He is. I am not a barbarian. He is. And he is. They all are. I possess moral authority. You see this fist? This is my moral authority. And don't you forget it.'

A writer's life is a highly vulnerable, almost naked activity. We don't have to weep about that. The writer makes his choice and is stuck with it. But it is true to say that you are open to all the winds, some of them icy indeed. You are out on your own, out on a limb. You find no shelter, no protection – unless you lie – in which case of course you have constructed your own protection and, it could be argued, become a politician.

I have referred to death quite a few times this evening. I shall now quote a poem of my own called 'Death'.

Where was the dead body found?
Who found the dead body?
Was the dead body dead when found?
How was the dead body found?

Who was the dead body?

Who was the father or daughter or brother
Or uncle or sister or mother or son
Of the dead and abandoned body?

Was the body dead when abandoned?
Was the body abandoned?
By whom had it been abandoned?

Was the dead body naked or dressed for a journey?

What made you declare the dead body dead?
Did you declare the dead body dead?
How well did you know the dead body?
How did you know the dead body was dead?

Did you wash the dead body
Did you close both its eyes
Did you bury the body
Did you leave it abandoned
Did you kiss the dead body

When we look into a mirror we think the image that confronts us is accurate. But move a millimetre and the image changes. We are actually looking at a never-ending range of reflections. But sometimes a writer has to smash the mirror – for it is on the other side of that mirror that the truth stares at us.

I believe that despite the enormous odds which exist, unflinching, unswerving, fierce intellectual determination, as citizens, to define the real truth of our lives and our societies is a crucial obligation which devolves upon us all. It is in fact mandatory.

If such a determination is not embodied in our political vision we have no hope of restoring what is so nearly lost to us – the dignity of man.

* Extract from "I'm Explaining a Few Things" translated by Nathaniel Tarn, from Pablo Neruda: Selected Poems, published by Jonathan Cape, London 1970. Used by permission of The Random House Group Limited.

© The Nobel Foundation 2005

Rajiv

08-31-07, 07:23 AM

The video of the Harold Pinter – Nobel Lecture
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Chris Coles

08-31-07, 08:37 AM

I think we should, all of us, put the last two sentences of Harold Pinter's paper up and keep them in view:

I believe that despite the enormous odds which exist, unflinching, unswerving, fierce intellectual determination, as citizens, to define the real truth of our lives and our societies is a crucial obligation which devolves upon us all. It is in fact mandatory.

If such a determination is not embodied in our political vision we have no hope of restoring what is so nearly lost to us – the dignity of man.

Thank you Rajiv.

Arnric62

08-31-07, 09:24 AM

As a fellow Brit, I have to demur slightly from Chris Coles' admiration for John Pilger. Although Pilger can perform a useful service on specific issues - as when he highlights the appalling cynicism of, and suffering caused by, US and British policy in the Middle East - he is so partis pris that little he says can safely be taken at face value.

Chris Coles

08-31-07, 10:58 AM

Then I suggest that you find the TV reportage of the people being shot, along with the priests he mentioned on the steps of the cathedral and call that partis pris. It is all there on the record for anyone to see.

If he was such a bad documentary maker, how come he has got such a strong reputation, world wide? Trying to diss someone with a world class reputation of integrity with a couple of Latin words does not work. Give us your detailed evidence.

Rajiv

08-31-07, 12:30 PM

I know of no individual in this world who is NOT parti pris if they are in any way even slightly knowledgeable about a subject that is under discussion.

parti pris (http://www.thefreedictionary.com/partis+pris)

par·ti pris (pärt pr)
n. pl. par·tis pris (pärt)
An inclination for or against something or someone that affects judgment; prejudice or bias.

[French : parti, decision, side + pris, taken.]

Jim Nickerson

08-31-07, 12:39 PM

I know of no individual in this world who is NOT parti pris if they are in any way even slightly knowledgeable about a subject that is under discussion.

parti pris (http://www.thefreedictionary.com/partis+pris)

Then nothing anyone says has any validity? Truth, though looked upon as some absolute, rarely, if ever, is absolute. So what we probably accept as the "truth" is the closest one can come given one's own biases and those of who put forth whatever proposition is being promoted.

I appreciate all that Chris Coles has put up on this thread. Good work, Chris.

Rajiv

08-31-07, 12:56 PM

Truth, though looked upon as some absolute, rarely, if ever, is absolute. So what we probably accept as the "truth" is the closest one can come given one's own biases and those of who put forth whatever proposition is being promoted.

Exactly my point Jim.

We generally accuse someone who does not agree with us of prejudice or bias -- the assumption being that "I am the unbiased one and the ultimate arbiter of the cause." This is never true -- each one of us has our own biases, and we are never able to see the entire panorama. I think the best we can do is to try to put ourselves in the other person's shoe - and try to understand our own biases and the others views, and perhaps come up with a better understanding of the world around us.

Lukester

08-31-07, 02:24 PM

Chris -

Pinter's a wonderful playwright, and I much admire his work. I agree with a good deal of his indictment of US foreign policy (and your own indictment!), and many Americans in this community, being in varying degrees of libertarian viewpoint, probably also feel that the US can only fatally weaken itself through a continuing unwise and questionable "imperial overstretch". You may not recall this readily, but actually it was precisely the Republicans who were traditionally non-interventionists in the first half of the 20th Century. Evidently those wise traditions have been lost within that party today.

You may be astonished to hear it Chris, but many of us are against US interventions also! I am, just for example. So you see, contrary to your view that Americans are swaddled in illusions due to an atrophied press, there is probably no great revelation which we must attain to appreciate your viewpoint.

Indeed, in this regard, you run the grave risk of preaching to the converted! ;)

I am not nearly as biased against your views as you suppose. I only object to critiques which cannot adopt a decent balance in their outlook - which for example use war data to indict the US, but omit large pieces of within that data which heavily qualify the conclusion drawn as to who is actually committing the most grotesque and unpardonable violence within that theatre. I noticed your reply did not address that discrepancy, nor has anyone else acknowledged that point here (Rajiv?).

Your cited sources of critique are therefore for me a shade too partisan, but maybe it's just a matter of personal style. Just to clarify, I'm not a partisan of the US - but I dislike slanted political commentary.

I do agree with you the US should drastically scale back it's foreign interventions. In a much wider sense however, I don't agree with a good part of your world view, which presumes the highly compromised actions of major powers in the world represent any great departure from the supremely cynical actions of all pre-eminent powers in history. In fact, they are entirely the norm for pre-eminent powers.

The 'insight' here is simply this: All nations which rise to preeminence inevitably encounter a pollution of their original aims - the mere fact of being a larger power has historically caused, and required, ever increasing layers of cynicism in foreign policy as interests become progressively more entangled. History demonstrates this is almost an inviolable law among all nations, to an extent determined only by their power - before which idealists have felt acutely tormented for centuries, while railing at the blindness of their fellow men who refuse to "see" the depths of that iniquity.

I read so many idealists, who are tortured by the filth and bilge which occurs in international power plays between nations, and marvel at the exent they continue to believe it has ever been any different in previous eras, and among former global powers. The game is filthy. Even the very best of them find, when thrust to the highest levels of international power, that they must make faustian bargains at practically every level as they try to reach for any moral result at all in the cesspool of cynical and conflicting national interests.

Idealism therefore, paradoxically, can blind you almost as much as it can allow you to see.

As a citizen of Europe you've no doubt noted the vastly cynical interplay of nations - in a mere 300 years of European history. It's been going on for millennia - what makes you think it's unlikely to exist today?

The dangerous conceit in Europe today (and we certainly have our own large conceits over here too Chris), is that having swept all these previously brutally cynical conflicts away in a new Federalism among European nations exausted by three or four continent wide wars in 200 years, some idealistic Europeans believe the rest of the world will be an equally suitable candidate for that denial of any national identity which they have discovered, and willingly embrace the supra-national federalism which Europe now celebrates.

This is a risky conceit, because vast areas of the world are just now discovering their national strength, and will in the next few decades embark on 'adventures' to exercise it, for which European pacificism is woefully unprepared. I will not expend a further breath to persuade you of that. We can only let the predictable history of the past repeat itself with the same inevitability it has displayed before.

Regarding cynicism, you'll find it in the most unlikely places: Take Churchill in WWII as an example - and that same cynical rule displayed in his case has carried on with monotonous regularity in peace-time politics among great powers ever since : Churchill had to decide whether to withhold vital Allied assistance to resistance movements, or secondary fronts, as a means to conserve his resources for more central battles. Tens of thousands of very brave men and women were simply sacrificed by Churchill and Roosevelt to expediency. These were presumably principled men, but there are many instances in international affairs where principle takes a back seat to more "pragmatic" concerns (translation = cynical).

A leader of one of the great powers routinely must make decisions which if analysed in the narrow particular (video of an individual getting shot by provocateurs) appear, or even are, highly immoral. Any trace of morality is mangled beyond recognition in the face of sometimes truly awful options. Sometimes there is absolutely no good reason at all, and what's occurring is merely viciousness without any mitigating reason.

The big point is, filthy ethical bargains are routinely made in international politics at the highest levels of the leading powers. The bilge is everywhere, and has been the standard game for centuries.

Among the community of those tormented idealists, who decry that filth with great personal outrage, there is a very high preponderance of people who while having studied history, remain curiously unable to discern that the exercise of power at the large nation level is a miasma of interests which command adherence to positions which routinely flout what is spotlessly ethical. Britain arguably was far more subtle, cynical and effective at this game for 300 years than the US has ever been.

All nations are venal in foreign policy and history demonstrates this has been the rule for centuries. Some carry venality to absurd extremes. The former Soviet Union for instance, when expanding it's sphere of surrogate states in Africa in the 1970's, made a treaty with Angola for reciprocal maritime rights. The Russians could fish and explore for oil off Angola's rich coastal waters, and Angola obtained reciprocal fishing and exploration rights in the Barents sea! What open-handed kindness of the Russians to arrange these terms of trade! I believe their largest export to Angola thereafter was arms.

The cause of idealists is good and just - that much is obvious - they merely do not understand that history shows them clearly that nations don't have allies or principles, they merely have interests. What is mildly irritating to those who are not idealists, is that idealists seem to ascribe a terrible ignorance of the facts to the rest of us. You seem to believe if the scales would only fall from our eyes, we'd see all the iniquity which you also see.

c1ue

08-31-07, 04:51 PM

You are correct, but the country that will gain by far the best advantage is Russia. They have a vast area of permafrost, possibly several times the area in Canada that has been thawed out during every summer since 2000. (I flew over it twice during 2001) and it is prime land.

Damn, you have my secret plan found out!

Rajiv

08-31-07, 06:48 PM

I am not nearly as biased against your views as you suppose. I only object to critiques which cannot adopt a decent balance in their outlook - which for example use war data to indict the US, but omit large pieces of within that data which heavily qualify the conclusion drawn as to who is actually committing the most grotesque and unpardonable violence within that theatre. I noticed your reply did not address that discrepancy, nor has anyone else acknowledged that point here (Rajiv?).

I think a little bit of history of Iraq is in order here -- and one has to remember that even poor, relatively primitive people often learn the lessons of history -- perhaps better than educated westerners -- because they rely on oral traditions -- and stories are remembered and passed on.

From British Colonialism and Repression in Iraq (http://www.globalpolicy.org/security/issues/iraq/history/britishindex.htm)

Britain set up a colonial regime in Iraq after a long military campaign during World War I. In response to Iraqi resistance, including a country-wide uprising in 1920, British forces battled for over a decade to pacify the country, using airplanes, armored cars, firebombs and mustard gas. Air attacks were used to shock and awe, to teach obedience and to force the collection of taxes. Winston Churchill, as responsible cabinet minister in the early years, saw Iraq as an experiment in high-technology colonial control. Though officials in London sometimes had qualms about the violence, colonial administrators on the ground like Gertrude Bell expressed enthusiasm for the power of the imperial military enterprise.

So is this a repeat of history?

From History of Oil in Iraq (http://www.globalpolicy.org/security/issues/iraq/history/oilhistindex.htm)

Lord Curzon, the British Foreign Secretary, denied that oil interests influenced policy in Iraq, but the archives show that the British government rushed troops to Mosul in 1918 to gain control of the northern oil fields. Britain and France clashed over Iraq's oil during the Versailles Conference and after, but Britain eventually took the lion's share by turning its military victories into colonial rule. The powerful Iraq Petroleum Company, in which US and French firms held minority positions, acted always in the cartel interests of the Anglo-American companies. To the fury of the Iraqis and the French, it held down production to maximize profits elsewhere. The company kept a monopoly of Iraq's oil sector until nationalization in 1972.

Please do read the entire history of Iraq outlined there to see how colonial powers (Britain, US and France) gained economic control of Middle Eastern assets over the last century through brutality, mayhem and murder -- It is easy to blame the actors, and absolve the instigators -- when it is really the other way around -- left to their own resources, the inhabitants of the Middle East would probably have come to much more peaceful solutions.

In the period 1914-1928 Indian troops were heavily used to fight in Iraq. This is one of the reasons India and Pakistan refused to take part in the Iraq war (see Washington presses India to send troops to Iraq (http://www.wsws.org/articles/2003/jun2003/indi-j30.shtml))

India is under pressure from the Bush administration to make a substantial commitment of troops to assist in shoring up the US occupation of Iraq. As US troops come under hostile fire, Washington is eager for other countries to join the so-called stabilisation force in Iraq, both to bear the burden of suppressing the growing resistance and to provide a veneer of international support.

The US has requested that India send a full army brigade of more than 17,000 troops to take on the responsibility of administering the northern sector of Iraq—an area of sharp tensions between ethnic Kurds and Arabs. If New Delhi agrees, the Indian force will be larger than the present British contingent and second only to the US military force itself.

From Imperial History Repeats Itself (http://www.countercurrents.org/iraq-ramesh040703.htm)

This is not enough. What Washington needs is a "reserve of military strength [capable of] ... supplying an army always in a high state of efficiency and capable of being hurled at a moment's notice upon any point". These words are not those of an American neo-conservative in 2003, but were articulated by the British viceroy of India, Lord Curzon, in 1909. A century later, the subcontinent's role as a source of auxiliary cohorts for the expansion of empire is being reprised by President Bush. New Delhi and Islamabad are considering American requests for a total of 30,000 soldiers to be sent to Iraq.

India and Pakistan, historic rivals who have fought three wars in 50 years, would not meet in Iraq. Dangled in front of both, instead, is the command of sizeable parts of Iraq, and a warming of the Bush administration's new strategic relationship with the subcontinent. However tempting the offer of aid, arms and a new engagement with Washington may be to both nations, both are acutely aware of the lessons of imperial history.

During the days of the British Raj, Indian soldiers were used to put down nationalist rebellions, at home and abroad. Blood was spilt all across the empire - much of it in Iraq.

During the first world war, what was then the Ottoman province of Mesopotamia became a battleground between Turkish and British empires. The low point of Britain's Middle East campaign came when 12,000 soldiers - more than half composed of Indian divisions - surrendered the garrison to Turkish forces in May 1916 after a siege which lasted 147 days. Of the troops who left Kut with their captors, more than 4,000 died either on their way to captivity or in prisoner-of-war camps. In four years of fighting, 31,000 British and Indian lives were lost, pockmarking the country with graves and pyres.

The birth of what would become modern-day Iraq was a painful one. Mesopotamia was Britain's prize after the first world war - and like today, its peoples struggled against the occupying forces. Indian troops were used to suppress the country's nationalist uprising in the summer of 1920. Like today's American forces, the 60,000 British and Indian troops securing Mesopotamia were never engaged in battle, facing instead hit-and-run raids from the desert. More than 1,000 Indian soldiers and 8,000 Arab fighters were either killed or captured in a few weeks. Despite Britain's military prowess, Iraq slowly slipped from its grasp.

So to say that US was in Iraq to depose Saddam and bring democracy to that land is a bunch of --------! The US administration tried using a bunch of ever shifting excuses to justify the war -- shifting as each reason proved to be demonstrably false - finally latching on to the excuse that if we leave Iraq -- the region will devolve into a civil war. So What? US is not the policeman of the world. Let the people of the region and I mean the entire region -- from the Kurds to the Palestinians, to the rest of the inhabitants come to their own solution without the influence of the Neo Colonial Powers of North America and Europe.

Lukester

08-31-07, 07:32 PM

Rajiv -

<< So to say that US was in Iraq to depose Saddam and bring democracy to that land is a bunch of --------! >>

If you read my posts on Iraq you will note that there is no trace of this assertion to be found. You are answering the "Democrat Vs. Republican" argument which is a tired argument, with merits on both sides, and which most importantly, has raged in this country for close to five years. I am inclined to agree with you on it. However, you are talking right past my stated issues, which were a request that the following be recognized:

A) Chavez cannot by any description be called a statesman, because he is quite obviously attempting strenuously to dismantle constitutional checks upon his power in Venezuela - and conversely a very sound case can be made that he is attempting to become an all-out dictator.

B) Any commentator here who is unable to quickly discern this and acknowledge it, casts their acuity and forthrightness into question on the entirety of their critique.

C) Regarding quoted articles equating Bush and his administration with Hitler and the Nazi wars of conquest is patently absurd. He may be more similar to heavily compromised British premiers who have tried to salvage empire - but these are a quantum leap away from Hitler.

D) Any commentator here who is unable to quickly discern this and acknowledge it, casts their acuity and forthrightness into question on the entirety of their critique.

For all the rest, I'm just tuckered out now. You'll have to excuse my incurable frivolity, but it's time to watch a re-run of Seinfeld on Cable TV.

I greatly appreciate your scholarly contributions Rajiv. I think most of what you write is super. You are a somewhat to the left of me, but I'd trust you as my State Senator to make sound decisions on my behalf! I'm fairly sure you'd politely decline that job though! :)

Chris Coles

08-31-07, 07:42 PM

Lukester,

I am back tracking to your last comment and in true itulip tradition I am giving you a contrarian view of the matter of ethics in government.

You have done me a great favour using Churchill as an example. We know about Churchill because he is a visible individual. We know his thoughts as he was an elected politician. We can read his letters, writings and speeches. When he made decisions there were plenty of others freely able to stand beside him and counsel him. He was an open book to Parliament.

The problem we all address today is that we do not enjoy the same relationship with the government employees that have crossed this planet as they went about their work, to subvert the democracies of other nations. It has been so easy to “turn a blind eye” to actions made by someone we never see, know, read about, read their speeches, read their letters. By the same token, they have been able to do as they will and at one and the same time, because we have never known the truth, because it was never made public, they have been able to distort any fact, present any scenario, to prevent the full facts of their actions becoming visible to the ordinary people of the nation.

But even more so, once you allow the creation of such a group of individuals, they as a group will gather others like them to their cause and slowly, they subvert the whole original concept, (which was no doubt laudable at the outset), to their own purposes. This is how any secret group becomes subversive to the nation that spawns them. It is very much in their interest to keep the whole thing cloaked in a patina of respectability.

At the beginning of this new era, you will remember that President Eisenhower himself had misgivings. As did others that followed. But the record shows, no one had the means to put a stop to the whole thing gaining ground and settling in for the long term.

I have been working on a petition to the United States Supreme Court asking the question: Is the government of the United States; Ultra Vires - if it does not act to the highest ethical standards? (I have edited it down a bit and place the bare bones of my thinking here for you to see where I am going with my thinking).

The stature of a nation stands upon three pillars; the rule of law, the value of its currency and the honesty of its dealings enacted with all other nations. If the rule of law is seen to be moot, or the currency has no value, or that the nation does not stand by its treaties, then I argue that the stature of a nation will collapse.

It is the role of a government; to produce law. We, the citizens of those countries, agree to abide by the law and accept that our actions have a pay back that permits us to live our lives within the framework of the law in peace and without disruption from anyone, including our respective governments. That abiding with the laws enacted by government, is a very simple and basic requirement of citizenship. That simple statement carries us into our relationship with any government; for to be the font of the law requires that a government must abide with any and all law itself. This is not a negotiable; this is fact, for if any government ever turns away from the rule of the law it enacts, its very legitimacy is destroyed. Governments must abide by the law they enact for the whole concept to work. What I have found is that in fact, that relationship has broken down; That the government of the United States is quite prepared to ignore their own law, if that will suite their own purposes. I believe that we have to face the truth of this breakdown and seek a way forward back to re-establishing the full rule of the law by government itself. That a great part of the problem is that attorney’s employed by government today, have lost contact with their ethics. By that, I mean that the high principle engendered by the concept of the rule of law has been usurped.

Rather than abide by the rule of the law to the highest ethical standards and accept that sometimes even a great government can have duties engendered by the law it enacts; the principle of unjust, unethical actions designed to usurp the true meaning of the law, rather than strictly abide has gained credence and today, the rule of the law is as a result moot.

That governments, by the action of their attorneys, have placed themselves into the position of both being the font of all law while at the same time, refusing to accept the responsibilities engendered by the rule of law. I believe that makes such governments Ultra Vires; Lawless; Law beyond one's legal power and authority. That if a government makes itself Ultra Vires in one area of the law; it undermines all the law of that government.

A Lawless Government as with any other criminal becomes illegitimate and throws away its standing in all areas of the law. You cannot have government making law on the one hand that it expects all others to abide by when, on the other hand, that same government blatantly refuses to accept the same laws apply to themselves. Yet this is exactly what is happening today and continues. Contempt for individual rights comes from a refusal to recognise the rule of law. There are no ethics in lawlessness, for ethics cannot apply to a lawless action. By the same token, you cannot claim sovereignty, (under law), and at one and the same time act without ethics and in any way infringe the law. To be able to claim sovereignty you must also act to the highest ethical standards. A sovereign nation must surely be an ethical nation?

I am told that the government may claim State Secrets privilege. In that case, we have to place ourselves in front of an independent individual with no ties to anyone whom we believe to be totally honest; a judge in a court of law, to get at the truth. I argue that simple act alone is all we need to be able to resolve the debate.

I can see a large number of independent attorneys suggesting that, without the relevant documents being available, there will be doubt that the truth has been placed before the court. I argue that that matter can be addressed by the court itself. What are we talking about? In my case, that would imply that we cannot trust the government attorneys to tell the truth. But I argue that, if we set out from the outset to create a Department of Justice that stands as a beacon to the entire world of honesty and at all times dealings of the highest ethical standards; then it is an easy matter to devise suitable punishment to suit any government attorney that does not display those high standards.

The Department of Justice must at all times be seen as totally honest and always acting with the highest ethical standards; it is surely in the interest of the <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-comhttp://www.itulip.com/forums/<st1:country-region>United States</st1:country-region> as a sovereign nation that that be so? Thus we will be able, standing on the steps of government, to feel totally at ease with our government.

Where any act of provision of fact has been made by a government or any part of that government, that information must be provided to the highest ethical standards. The facts must be the truth, the whole truth and nothing but the truth. To do otherwise is to commit an unlawful act. If a government attorney has acted unlawfully; they should be disbarred and, if the relevant department has encouraged that act of unlawful behaviour, it must be seen as damaging the reputation of the whole nation and the other individuals involved should be brought to justice, charged and tried in a court of law.

Either the <st1:country-region>United States</st1:country-region> government sets out to be a font of law and at all times lawful, or, it is not lawful. For the <st1:country-region>United States</st1:country-region> government to be seen as a lawful government, the government attorneys must, absolutely must, act at all times to the highest ethical standards and at all times exercise absolute total honesty. You cannot be untruthful and, arguably, unlawful and act to the highest ethical standards at one and the same time.

Again, the government may claim Eminent Domain. But the word domain implies some form of property and to own property implies ownership and ownership requires a consideration to pass between the parties for ownership to take place. No one, not even a government can own anything, call it what you will including intellectual property; an intellectual domain, without consideration passing between the two parties; on the one hand the present owner or owners and on the other the purchaser.

Taking without consideration being agreed between the two parties, is theft, stealing. A government has no mandate to steal anything. Indeed, for the government to remain beyond doubt lawful, it must at all times do everything in its power to see that it and especially its attorneys NEVER act unlawfully.

And this brings me to the core of this debate.

I believe that there is a clear perception today, held by the attorneys of the <st1:country-region>United States</st1:country-region> government, that a government department may do as it wishes. It is this that brings us from another angle back to the core of the debate and begs another question; what is the primary purpose of a government department? You might say it is to carry out the instructions of Congress. So it is pertinent to ask, on whose behalf does Congress and the department operate? I am going to argue that Congress must instruct the government department to operate to the benefit of the people, the citizens of the nation; that a government department has a duty to uphold the nation’s philosophy and mores. Why would I say that? Because, when we look in detail at the particulars, we see that, instead, the government departments today act in their own internal interest first and foremost.

I argue that that is an affront to the fundamental principles of a free society as laid down by the founding fathers of your nation. The moment they contrive to create rules of engagement that place their own, internal interest, above that of the people; they create the foundation stones of a feudal society. (Feudalism: A political and economic system of medieval Europe based on the relation of lord to vassal, in which land was held on condition of homage and service). (Vassal: A minion or slave).

Once the government department decrees that it has primary lean upon the thoughts and intellectual property of an individual, that individual is a slave to that government department. The individual freedom of the thinker is at a stroke destroyed. This takes us from an environment where the creation of free enterprise industry by free individuals drives the nation’s fortunes to one where the driving force for the creation of success is the primary function of government departments who take the ideas of the nation and they themselves try and create the success. That is a feudal society. In a feudal society, government naturally assumes that it has a right to take the thoughts and ideas of the free individual and use those ideas for its own purpose without recourse to any of the normal rules of a free society.

I argue that instead, by writing any rules that suite itself, for its own purpose, the government department can do as it wishes and treat the individual as though a vassal.

That this perception has today taken root in the wider world with disastrous results for the reputation of The United States and its perception of its duties to treat with the free citizen, the people; and to rule within the rule of the law. That today, the government rides roughshod over the concept of a free nation.

I argue that the primary driving force for the use of law must be the perception of the need to create the conditions for the success of a free society and that that primary aiming point has been lost; forgotten in the urge to create government departments that must be seen to succeed themselves, by complete control at any cost, imposed upon the people surrounding them. That this flies in the face of the concept of creating government departments with a primary purpose of creating the conditions for success for the ordinary people.

I believe that the Supreme Court must recognise that there is this perception at large and that it is causing great damage to the reputation of the law of the <st1:country-region>United States</st1:country-region>. I further believe that it is the responsibility of the Supreme Court to look again at this matter and create a set of clear, unambiguous rules of engagement, a framework of ethical rules to the highest standard that we on the outside can see in place and that those on the inside can see they must abide by.

Without that structure, a level playing field if you like, the actions taking place today stain the reputation of what many of us do sincerely believe to be the finest nation on the planet.

At the end of the day I believe that the reason that the lesson has been lost has to be that the practice of law has become totally adversarial. Everyone is the enemy.

In corporate law, yes, the attorney is there to protect the interests of the corporation; but it must be seen that in government, particularly where competition law comes into play, the primary responsibility has to be to encourage – competition. The government attorney has a much wider responsibility – the encouragement of a successful nation. If the government attorney has only a view that their responsibility is to protect the government, then everyone outside the government is an enemy.

That the citizen is to be held at bay and controlled; that success is to be trammelled by the idea that they must not interfere with the aiming point of the government.

I would argue instead that it is the governments responsibility to do everything it can to encourage the success of any citizen in their lawful pursuit of making the most of their particular talents and aspirations. It is a very real aspect of a feudal society, that those with power will do everything in their power to prevent the success of the ordinary citizen. Why? Easy to answer, merit always shines so brightly. The great embarrassment of an “old school tie” without merit is to see themselves outshone by a bright shining upstart. In those circumstances, they have every vested interest in the failure of the more successful. As the Earl of Clanwilliam once said to me; “Everyone has a vested interest in your failure”.

Today, I argue that it must be recognised that the greatest responsibility of the government attorney is to see that, in the pursuit of lawful gain, those with merit are encouraged to succeed; that by so encouraging, they prevent the establishment of a feudal society and encourage a free and prosperous nation.

And as soon as you accept that principle, the same must apply to any other nation you deal with. What so many of you have not realised is that your nation has not been treating with its neighbours free nation to free nation, but instead as though an old fashioned feudal nation hell bent on imposing feudal concepts regardless of the will of either the people of the United States, or the neighbour.

In my opinion, the ONLY way forward is to completely disband the CIA. No, I do not mean playing musical chairs and letting everybody slide off into a new, un-named organisation. When President Eisenhower realised the difficulties he was in with regard to uncontrolled forces within what he called the Military Industrial Complex; he should have done that then. He did not. But now someone must. It is the only logical route to a more peaceful planet.

How else are we to put a stop to hidden wars being perpetrated by people with no ethics that answer to no one as they continue to impose a feudal culture on your neighbours in complete contradiction to the ethics of the Founding Fathers of your nation?

The last words in the film War on Democracy were by Chavez: “There is nothing so powerful as an idea whose time has come”

The “idea” Chavez talks about is that no one is going to continue to put up with lawless actions by unnamed government employees, (of any nation), hell bent on imposing on peaceful peoples of other nations their own grimly distorted feudal concepts of truth and justice.

One final thought, you can murder a President, but you cannot murder these words; they live on forever.

Lukester

08-31-07, 11:49 PM

Chris -

I'm a little astonished they gave the summation in this documentary to Venezuela's Chavez.

His closing remarks sound appropriately lofty, for the summation of such an ambitious documentary, yet my perception is they are ghastly somehow, given what we know of his crude and forceful "rearrangement" of the Venezuelan parliamentary system. :)

I suppose all I can say is that I'm not really on board with your theme here.

Cheers.

c1ue

09-01-07, 03:46 PM

Chris, Lukester,

Interesting discussion on both sides.

I think ultimately the issue boils down to this:

Can any government ultimately be fair and honest?

Utopically this should be possible, however, history has thus far been nearly unanimous in showing that those who strive for power ultimately care for this pursuit far more than any ideals concerning fairness and honesty.

It is no more surprise to me that Bush (his predecessors, Democrat and Republican) attempt to secure what he sees as important to the American nation, than the British rulers did in their time of empire (read about the Great Game of Kipling's "Kim" fame), or any other empire in history.

You can blame Bush, but really nothing he has been doing is any better or worse than what has happened even here in America in the immediate past.

My view is that ultimately the only safety is minimizing government to a few specific functions: making crime of reasonable hazard to criminals, making foreign economic and military interventions in this country of reasonable hazard to other nations, building those things which individuals can never do (infrastructure), and verifying and enforcing standards agreed upon by the lowest common denominators within the people.

Everything else just leads to a vicious synergy of self-glorification, waste, and corruption.

Chris Coles

09-03-07, 04:42 AM

You both make my point for me. This debate has been a bit like watching an old movie. High Noon comes to mind. Both of you have arrived at the point where the sheriff is assumed to be permitted to be able to break the law with impunity and you are going to sit back and say... "it was always thus, so it will always be thus".

My point, (perhaps I am not getting it across very well), is that, in fact, the nation does not prosper when the nation turns its back on the sanctity of the law. Yes, the avoidance is all made out to do with "protecting the interests of the nation". But, in fact, I argue that it is not in the long term interests of the nation.

This debate started when I started to argue that Chavez is not such a bad individual as was made out. Yes, I can see that he may well be not acting as we would wish he would. But look at the circumstances HE finds himself in. Having been elected in free and fair elections, (surely, you are not going to say that having never been in power, he had the power to usurp the vote), he finds his own citizens, peacefully marching to show disapproval against his actions, are being shot in the street by people that are supported by the USA. At the same moment, he is kidnapped. Come on, you are stretching your imaginations by then trying to say he is not going to react AGAINST such actions. That anyone with an axe to grind against the USA is not going to walk into his office and offer the kind of things he has now started to buy, arms...... to protect his nation.

I am arguing, if you want prosperity, you trade. If you want to go to war, you do everything in your power to disrupt.

I say the United States of America became a powerful and successful nation on the back of trade and that the decline that itulip is forecasting is as a result of turning your backs on the concepts so well laid out by the founding fathers, the rule of law.

You are saying, now, today, the rule of law is moot and not worth a candle. That disrespect for the law is the way forward. Must be accepted as a fact and not to be worried about.

I am saying that that is the fundamental reason your nation is in decline and until the Department of Justice becomes totally lawful, the decline will continue unchecked.

Your founding fathers had seen, with their own eyes, the dreadful state Europe was in and they set out to establish a nation with better values.

I am a European that, having seen that their wonderful values have been debased by an attitude that now says, "Can any government be fair and honest?", I am saying that, if you want to return to the path that made your nation a success, you must also return to the core values of the founding fathers and restore a lawful government that has, as its prime directive, peaceful relations with all other nations.

This weekend this turned up in The Sunday Times London.

How the West summoned up a nuclear nightmare in Pakistan
Adrian Levy and Catherine Scott-Clark reveal how misguided deals with Pakistan have created a terrifying threat of nuclear terrorism

http://www.timesonline.co.uk/tol/news/world/asia/article2368174.ece

"Behind this desperately worrying state of affairs lies a grand deception. For three decades, consecutive US administrations, Republican and Democrat, as well as governments in Britain and other European countries, allowed Pakistan to acquire highly restricted nuclear technology. Key US agencies were then misdirected and countermanded in order to disguise how Pakistan had sold it on.

Intelligence gathering in the US was blunted while the departments of state and defence were corralled into backing the White House agenda and forced to side-step Congress and break federal laws. Officials who tried to stop the charade were purged."

"While knowing what was going on, Washington pursued a deception that bloomed into a complex conspiracy. Evidence was destroyed, criminal files were diverted, and Congress was repeatedly lied to."

Extracted from Deception: Pakistan, the United States and the Secret Trade in Nuclear Weapons, to be published by Atlantic Books on September 13 at £25. Copies can be ordered for £22.50 including postage from The Sunday Times BooksFirst on 0870 165 8585

In my humble opinion, the United States is not only on a path of financial decline, it is on a path that has already taken its legal stature to the bottom of the pit. And, that it is its present belief, by many of its citizens, that unlawfulness is OK, is the underlying reason for the financial decline.

Both Germany and Japan have become very successful nations, not by continuing the war with the rest of the planet, but by trade, lawful, honest trade.

The only way we are going to get Chavez back into the fold with proper democratic institutions is by trade and debate. Trying to smash him is only going to feed the arms trade and drive his fear of being attacked and the need for more arms. Or are you going to tell me that if I walk up to you, you are going to shake my hand and make me your friend after I punch you in the face.

And, if I have already swung the punch, just how much money will have to change hands before you agree, reluctantly, to change your mind?

The fact is it will take a very long time indeed and a great deal of very hard work to convince Chavez that any of us have his nations best interest at heart.

The starting point has to be a clear sign that the United States has returned to a full respect for the law of its own citizens.

That responsibility I lay right at the feet of The Department of Justice of The United States of America. They are the only group on the planet with the tools readily to hand to change the present paradigm and steer your nation away from a feudal future just as bad as the European one that your founding fathers rejected so eloquently when they started with the words; "We the people".

Rajiv

09-03-07, 07:29 AM

Chris,

I couldn;t have put it better. This is the reason, tha the US and Britain are NOT and CANNOT be a part of the solution in Iraq by staying in Iraq. The US and Britain have lost all legitimacy (and legal standing) in that region. Not withstanding that old saw (possession is 9/10ths of the law (http://answers.google.com/answers/threadview?id=496059))

Lukester

09-03-07, 07:00 PM

Chavez Economy Unravels as Venezuela Currency Weakens

By Alex Kennedy and Matthew Walter

Sept. 3 (Bloomberg) -- Hugo Chavez's economy is starting to unravel in the currency market.

While Venezuela earns record proceeds from oil exports, consumers face shortages of meat, flour and cooking oil. Annual inflation has risen to 16 percent, the highest in Latin America, as President Chavez tripled government spending in four years. Exxon Mobil Corp. and ConocoPhillips are pulling out after Chavez demanded they cede control of joint venture projects.

The currency, the bolivar, has tumbled 28 percent this year to 4,750 per dollar on the black market, the only place it trades freely because of government controls on foreign exchange. That's less than half the official rate of 2,150 set in 2005. Chavez may have to devalue the bolivar to reduce the gap and increase oil proceeds that make up half the state's revenue.

"This has been the worst managed oil boom in Venezuela's history,'' said Ricardo Hausmann, a former government planning minister who now teaches economics at Harvard University in Cambridge, Massachusetts. ``A devaluation is a foregone conclusion. The only question is when.''

Chavez will devalue the bolivar 14 percent in the first quarter of 2008 after he introduces a new currency on Jan. 1 that will lop three zeros off all denominations, according to JPMorgan Chase & Co., the third-largest U.S. bank, and Merrill Lynch & Co., the biggest brokerage firm.

The new currency, to be called the strong bolivar, will have an exchange rate of 2.15 per dollar, the equivalent of today's rate, Finance Minister Rodrigo Cabezas said last week. Analysts forecast the official rate will decline 13 percent by the end of 2008, according to the median of nine estimates in a Bloomberg survey.

Healthcare, Housing

"We're not going to devalue no matter how much they pressure us,'' Cabezas told reporters in Caracas on Aug. 31. ``The so-called parallel market doesn't dictate our fiscal, exchange or monetary policies.''

Chavez, an ally of Cuban President Fidel Castro who calls capitalism ``evil,'' weakened the currency 11 percent in 2005. He imposed restrictions on foreign exchange in 2003 to halt capital flight that has driven down the bolivar more than 70 percent since he took office in 1999.

A devaluation would give the government more bolivars from its oil export tax receipts, helping fund Chavez's policies to provide free healthcare, housing and discounted food to millions of Venezuelans. The government says social programs helped cut the poverty rate to 34 percent in the first half of 2006 from 49 percent eight years earlier.

Oil, which has risen 155 percent in the past five years, accounts for about 90 percent of Venezuela's exports. The country is the fifth-biggest member in the Organization of Petroleum Exporting Countries.

Trips to Curacao

As the gap between the official exchange rate and the black market rate has increased, so has the incentive to exploit rules, such as a regulation that allows people to spend $5,000 a year on their credit cards while traveling abroad.

Some Venezuelans travel to nearby Curacao, where they buy $5,000 of casino poker chips with their credit cards, exchange the chips for cash and then sell the dollars in the black market back in Caracas.

"People are invoking their right to circumvent what are very, very stiff controls,'' said Alberto Ramos, senior Latin America economist at Goldman Sachs Group Inc. in New York.

The foreign exchange regulations are part of the controls that Chavez, 53, has created in his "march to socialism.'' The government sets retail prices on hundreds of consumer products and fixes both the maximum rate at which banks can lend and the minimum interest they can pay depositors.

Chavez, who is seeking to end presidential term limits, has taken $17 billion of foreign reserves from the central bank and expropriated dozens of farms that he deemed underutilized.

Exxon, ConocoPhillips

He nationalized Venezuela's biggest private electric and telephone utilities and took majority stakes in oil projects owned by Exxon, the world's largest producer, and ConocoPhillips, the third-biggest in the U.S. Foreign direct investment was a negative $881 million in the first half as foreign companies pulled out money.

Chavez terminated the broadcast license of the country's most-watched television network in May, sparking weeks of student protests. He has threatened to take over cement makers, hospitals, banks, supermarkets and butcher shops, saying they weren't obeying price controls.

"It's like our director of marketing, our director of sales, our director of manufacturing is President Chavez,'' said Edgar Contreras, who runs international operations at Molinos Nacionales CA, a Caracas-based food manufacturer that employs 1,500 people. ``We can't go on like this.''

"Fantasy Prices"

Contreras called the government-set prices on many products "fantasy prices'' that are below production costs. Items including milk, chicken, coffee and flour have disappeared from store shelves in Caracas at times this year because companies refused to sell at a loss.

The government has responded by giving importers more dollars at the official exchange rate. Imports soared 43 percent in the first half to a record $20 billion after tripling in the previous three years.

The country's current account surplus fell almost in half to $8.8 billion in the first half even as near-record high oil prices buoyed exports. Crude oil for October delivery rose 4.2 percent last week to $74.04 a barrel on the New York Mercantile Exchange.

"The growth in imports is so out of whack that it's choking off the local sector,'' said Teodoro Petkoff, a former government planning minister who now publishes opposition tabloid Tal Cual in Caracas. ``The engine of growth isn't the real economy. It's the government.''

"House of Cards'"

While the rise in government spending fueled economic growth of 9 percent in the first half, output in five of 16 manufacturing industries shrank from January to May, according to the central bank.

Harvard's Hausmann said the growth in public spending has been so rapid that the government needs oil prices to keep rising to hold its deficit in check. He estimates the public sector deficit will equal about 5 percent of gross domestic product this year. The Finance Ministry forecasts the public sector will post a balanced budget this year, Public Credit Director Luis Davila said last month.

"For the macroeconomic house of cards not to come crashing down, the price of oil has to go up at double digit growth rates,'' Hausmann said. ``If oil stays at $70, they're going to hit the wall.''

To contact the reporters on this story:

Alex Kennedy in Caracas at akennedy1@bloomberg.net

Matthew Walter in Caracas at mwalter4@bloomberg.net

Last Updated: September 3, 2007 14:59 EDT

Chris Coles

09-04-07, 04:13 AM

Sounds a lot like the UK at the end of WW2. We had food rationing for more than a decade and most industry was already nationalised. Our currency was on the rocks and the USA was not prepared to help in any way. We are still working our way out of that period, STILL working our way out. Why do I say that, because the systems now in place here do not totally fulfil the needs of the majority and our housing bubble is but one example. There is a huge debate going on about the direction of our nation, our economy.

What you have described is a system that has not delivered to the ordinary people of the nation. Someone, Chavez, has come along and got himself voted into power by those same people who had completely lost confidence in the system that did nothing for them. Chavez is stumbling around trying what he believes will work. In some ways it is working, in others it will be a complete failure.

You do nothing for anyone if all you do is stand outside and criticise. The only way forward is to work with the electorate of a nation and do your best to achieve success for everyone. But the USA has no track record of doing anything for the majority of that nations people other than encouraging some complete idiots to murder citizens in the street.

You make my case for me. Your credibility is totally shot away by previous mistakes and a failure to go in and do your best for the majority. As much as you would like to re-take complete control of that nation, you will never be allowed to do so simply because you have made the wrong choices from the outset.

The only way forward is to formulate a strategy that will empower the economy for everyone in the nation. But, the truth is you do not have any such strategy because the one you are so keen to re-impose is the very one that has not delivered in the past. THAT is your problem. THAT is their problem too. Capitalism has not delivered. Communism will not deliver either, we both know that to be true. So the poor of a wealthy nation are undertaking an experiment and for the time being their idealism has taken them into dangerous waters that is leading to more instability.

I would expect that there are hundereds of researchers world wide doing exactly that with some industrial process or other. Not knowing if the whole rig will explode or settle down and produce a success. I wish them luck. If I can make any input that will lead them towards some sort of stable success I will do that. But the one thing I will not do or tolerate in any other is to try and destroy their experiment. They have every right to try and to fail.

That is what freedom is all about. It is not about only being allowed to do that which anyone else, outside the nation believes is correct, it is about the freedom to fail.

I will quote myself. "Such ventures are surely the great river sources of a nations vitality". http://www.chriscoles.com/page3.html

The reason why I wrote the basic outline of what I now describe as "A Capital Spillway Trust" is exactly the reason why I defend the right of that nations people to try, even if they fail. Simply because we have now an embedded feudal culture that says, either you do it my way, or you are not allowed access to capital.

Failure is good as it will teach, better than any exercise in distorted idealism called capitalism, that the road they are on does not work in some way or other. But by failing, they learn what is good for them.

Capitalism has not delivered in many nations at the grass roots level. There are many reasons for that and it is just as true that communism and even its younger brother, socialism, has not delivered either. Personally I believe the underlying reason is not that the concept of capitalism is wrong, but that the application of the concept has been bedeviled by a failure to see that, unless you have free markets in capital as you have for everything else, you impose a feudal version that does not deliver to the greater masses of the people of a nation.

And that brings me right back to the beginning, a feudal culture does not believe in the rule of the law, it quietly twists the truth to cover up its failings, the greatest of which is that feudal capitalism has not delivered freedom for the greater mass of the people in South America.

Every nation is troubled by the needs of the poor in their society. Chavez has every right to try and find a solution, even if he fails while trying. No one will succeed to change his direction by trying to force him to believe in a concept that has not delivered in the past and has a varied record throughout the rest of the planet.

To build a strong house, you need to walk onto site and use common sense and debate with the builder to reach an understanding of the best building practices. Yes, with a builder, you can fire him. But with a nation and an elected leader, you have to work with him and do everything you can to help him succeed and where he fails, you dust him down and get him to recognise his mistakes. Just like any member of your own family.

Finster

09-04-07, 09:12 AM

Please be advised my own doctors think my electroshock therapy has been a great success!! Three years of continuous treatment is now yielding good results, or so they tell me.

Lukester, as I warned in my reply to you in the earlier thread Cash Rallies (http://www.itulip.com/forums/showthread.php?p=12793#post12793), you keep that up and you might wind up like me …

Yet something must have been doing you some good. ;) Amid so much emotionalism on both sides about GWB and the Iraq war, it is refreshing to hear a voice of rationality and balance:

…This is getting carried away with some absurd hyperbole - the quote makes no distinction between George W. Bush's intervention to oust Saddam and the wholesale systematic terror for terror's own sake of the likes of Stalin, Mao Tse Tung, Hitler, Pol Pot, Idi Amin, the Spanish Inquisitors, Ghengis Khan, or any of an entire host of men personally responsible for intentionally consigning millions to the more gruesome and imaginatively devised deaths - the above are men who actively and very pragmatically perfected the practice of imposing mass civilian terror as an ordinary daily tool of government.

I'm no Bush fan. I'll readily acknowledge this US president's intervention was bloody, ill advised, was ill executed, and has put some blood directly on it's hands to answer for - but it falls so far short of the above cast of characters in motivation and degree, as to make the comparison to them merely rhetorical nonsense.

I personally am happy to go as far as saying GWB is possibly the worst president since LBJ, but yes, comparisons with the rest are just waaay over the top. The latter, the last rootin’ tootin’ guns ‘n butter Texan to occupy the White House, certainly invites more apt comparisons than with RWR, the one used in the Republican pitch to voters.

You may be astonished to hear it Chris, but many of us are against US interventions also! I am, just for example. So you see, contrary to your view that Americans are swaddled in illusions due to an atrophied press, there is probably no great revelation which we must attain to appreciate your viewpoint…

I do agree with you the US should drastically scale back it's foreign interventions. In a much wider sense however, I don't agree with a good part of your world view, which presumes the highly compromised actions of major powers in the world represent any great departure from the supremely cynical actions of all pre-eminent powers in history. In fact, they are entirely the norm for pre-eminent powers…

Ironically enough, Bush himself has agreed with that. From the 2000 electoral debates with Gore (emphasis added):

…
MODERATOR: Sure, absolutely, sure. Somalia.

BUSH: Started off as a humanitarian mission and it changed into a nation-building mission, and that's where the mission went wrong. The mission was changed. And as a result, our nation paid a price. And so I don't think our troops ought to be used for what's called nation-building. I think our troops ought to be used to fight and win war. I think our troops ought to be used to help overthrow the dictator when it's in our best interests. But in this case it was a nation-building exercise, and same with Haiti. I wouldn't have supported either.

…
MODERATOR: So what would you say, Governor, that somebody would say hey wait a minute, why not Africa, I mean why the Middle East, why the Balkans, but not Africa, when 600,000 people's lives are at risk?

BUSH: Well, I understand, and Africa is important. And we've got to do a lot of work in Africa to promote democracy and trade, and there are some -- Vice President mentioned Nigeria is a fledgling democracy. We have to work with Nigeria. That's an important continent. But there's got to be priorities, and Middle East is a priority for a lot of reasons, as is Europe and the Far East, our own hemisphere. And those are my four top priorities should I be the president, not to say we won't be engaged nor work hard to get other nations to come together to prevent atrocity. I thought the best example of a way to handle the situation was East Timor when we provided logistical support to the Australians, support that only we can provide. I thought that was a good model. But we can't be all things to all people in the world, Jim. And I think that's where maybe the vice president and I begin to have some differences. I'm worried about overcommitting our military around the world. I want to be judicious in its use. You mentioned Haiti. I wouldn't have sent troops to Haiti. I didn't think it was a mission worthwhile. It was a nation building mission, and it was not very successful. It cost us billions, a couple billions of dollars, and I'm not so sure democracy is any better off in Haiti than it was before.

http://www.debates.org/pages/trans2000b.html

I am not nearly as biased against your views as you suppose. I only object to critiques which cannot adopt a decent balance in their outlook - which for example use war data to indict the US, but omit large pieces of within that data which heavily qualify the conclusion drawn as to who is actually committing the most grotesque and unpardonable violence within that theatre…

Ahhh … refreshing …

Lukester

09-04-07, 12:28 PM

Chris -

I hope there are some others here who can or will put forward reasoned arguments counter to your thesis that Chavez will ever consent to be reproved by his electorate for any faulty performance.

The fact is anyone within Venezuela who wishes to reprove Chavez has an increasingly difficult task to do so, and encounters ever more personal risk to attempt it. This much should be evident to all but the most hard-boiled idealists.

However I for one certainly appreciate having many different views on these pages, and I in no way take it personally that you have a diametrically opposite view than mine or are a proponent of dumping western democracies as too flawed to even bother rescuing.

For all the rest of it, I can only say that based on what appears painfully evident to me from reading this article on Bloomberg, Chavez will in all probability run South America's potentially richest country straight into the ditch. That's quite an accomplishment given the vast oil wealth they have to invest in building a new nation.

For a diametric opposite, look at what the Republic of Ireland have accomplished, in a country almost devoid of natural resources - they've turned it into a booming economy which is the envy of the other EU members. The fact Venezuelas economy is collapsing into high inflation and stagnation despite all their oil wealth is a scathing indictment of their present 'experiment'.

Perhaps, thinking of alternatives, you could be prescribing for them that they follow a more Scandinavian model of Socialism, which distributes the national wealth very carefully across all segments of society, does a good job of squashing any cronyism or corruption, but which above all remains resolutely vigilant to protect the constitutional process and a genuine multi-party system as well?

It is not socialist redistribution of wealth which I object to in your outlook. Not at all.

What I object to in your outlook regarding Venezuela, is the casual dismissal of concerns about the systematic dismantling of a free press, savage breakup of independent unions, draconian nationalisation of all business leading to a scorched earth policy for the entreprenurial capabilities of the country, systematic intimidation of all branches of government to accomodate a 'lifetime president' with barely a peep of dissent from the opposition.

A half decade ago their congress was bitterly and loudly outspoken and factional, but with all parties able to vigorously put forward parliamentary debate over their sitting government's policies. They are now completely muzzled, silent and collared.

It seems to me, you gloss over these things, you seem to bend over backwards, to accomodate the symbol of Chavez emancipation of the poor out of fear that if you begin to acknowledge any of the myriad pieces of evidence showing how badly he cuts constitutional corners to have his way, you might lose your grip on believing he's a leader for his country's poor in any constructive way at all.

I agree with you on the urgency of the emancipation needed for Venezuela's poorest. I most emphatically do not agree with your easygoing approval of their unconstitutional method. I think your easygoing, lax perception of what's necessary to defend constitutional process is the product of never having experienced first-hand within your own nation a genuine risk to your many quite wonderful democratic rights.

It's quixotic of you in the meantime to describe your political environment in Britain as feudal, as it's in fact one of the most constitutionally stable countries in the world. They are so chained to their constitutionality, that over the last 50 years they have come to be considered the most open country in Europe to immigrants. Britain is THE country to which all immigrants within 2000 miles of the EU aspire to obtain a working visa.

Of course it's full of flaws, overcrowded, overtaxed, etc. - as are so many other democracies. But to declare it is instead "feudal" produces a marked urge in those of us who disagree with you, to press into your hands an airplane ticket and six month visa stamp to go and spend six months in any number of nations who truly are feudal, if only to observe the relief you display upon eventually being allowed to return home to Britain thereafter.

We'd all be at Heathrow in a long line, cheerfully waving "Welcome Back to the Drab Old UK, Chris!!!" banners and cheering as you whizzed through passport control.

Due to the above devil-may-care quality of your views regarding the expendability of constitutional process, I regard your outlook as being what might be described as "eccentric". But eccentricity is a wonderful British characteristic for which your nation are justly famous worldwide, (fawlty towers?) and it is an attribute which greatly endears Britain to me, and which makes me a big fan of your country.

Despite the above implied rebuke of your views on democracy, I do offer this critique to you with respect. I took my university degree in the UK at the end of the 1970's - Britain's most drab post-war era. I had the time of my life, and left it a lifelong fan of the UK. I must therefore offer you that solidarity as well.

We must agree to disagree Chris.

Lukester

09-04-07, 12:30 PM

Thanks Finster!

Now would you and Bart please give me some good actionable advice so I don't lose my shirt holding a pile of bullion in the coming squirrely markets? :D

bart

09-04-07, 12:35 PM

Thanks Finster!

Now would you and Bart please give me some good actionable advice so I don't lose my shirt holding a pile of bullion in the coming squirrely markets? :D

"Don’t gamble! Take all your savings and buy some good stock and hold it ‘till it goes up, then sell it. If it don’t go up, don’t buy it."
-- Will Rogers

... and also something I'm acting on... with stops:

http://www.nowandfutures.com/images/predict_gold.png

Lukester

09-04-07, 12:38 PM

OK Bart - the cat's out of the bag now! You're going to get umpteen million iTulip readers piling into your positions! :rolleyes:

bart

09-04-07, 12:45 PM

OK Bart - the cat's out of the bag now! You're going to get umpteen million iTulip readers piling into your positions! :rolleyes:

http://www.nowandfutures.com/grins/mmm_something.wav :eek: :eek: ;)

Who knows on whether I'm right or not... these are treacherous markets...

Finster

09-04-07, 01:14 PM

Thanks Finster!

Now would you and Bart please give me some good actionable advice so I don't lose my shirt holding a pile of bullion in the coming squirrely markets? :D

You're welcome, Lukester!

As for the advice, you wouldn't really look to someone else who is "holding a pile of bullion" for advice on how to avoid losses in it, would you? :D

That said, IMO there's still much value in the age-old advice on the three D's of investing: diversify, diversify, diversify. I think, for example, that bonds stink longer term, but adding a little to your bullion can smooth the ride and even give you some dry powder with which to take advantage of fire-sale prices should bullion get even cheaper. Of course, equities always have a place in the mix, too. Same general idea as the "balance" theme you just eloquently spoke of.

Speaking of equities, BART, what's you're latest near-term take, say for the next 2-8 weeks?

bart

09-04-07, 01:25 PM

Speaking of equities, BART, what's you're latest near-term take, say for the next 2-8 weeks?

Frankly, that's too long a time frame for me to have much of an opinion on but if I had to say, it's be down in a whipsaw fashion.

I am showing a turn down likelihood for next Monday or so... and until I actually act on that opinion & research, it's just nothing but opinion and a WAG.

Chris Coles

09-04-07, 05:40 PM

Perhaps, thinking of alternatives, you could be prescribing for them that they follow a more Scandinavian model of Socialism, which distributes the national wealth very carefully across all segments of society, does a good job of squashing any cronyism or corruption, but which above all remains resolutely vigilant to protect the constitutional process and a genuine multi-party system as well?

It is not socialist redistribution of wealth which I object to in your outlook. Not at all.

What I object to in your outlook regarding Venezuela, is the casual dismissal of concerns about the systematic dismantling of a free press, savage breakup of independent unions, draconian nationalisation of all business leading to a scorched earth policy for the entreprenurial capabilities of the country, systematic intimidation of all branches of government to accomodate a 'lifetime president' with barely a peep of dissent from the opposition.

As an Englishman, (yes eccentric if you like to so describe me), I live by the British principle that while I may disagree with anything that anyone may say, I will go to my grave defending their right to say it. So, while I too very much disagree with events in Venezuela, I will go to my grave defending their right to the freedom to do so.

That is what I am trying to get across.

This is not about what Chavez is or is not doing, it is about his freedom, and the majority of his peoples freedom to vote for him and take the consequences for what he is doing.

Further, you both seem unable to conceive that the underlying reason why the political institutions we enjoy are being dismantled in Venezuela is because the majority of the people there do not believe they delivered what we expect and take for granted here.

The only reason for them to take such action must be because they do not believe those political institutions will deliver what they see as their view of freedom. Until anyone addresses those fears, and shows them how to make multi-party democratic political institutions work in their best interests, nothing will change their minds.

Turning your back and calling them fools and anyone trying to get a better understanding of why they fear our viewpoint "eccentric", is not going to deliver an answer either, ..... with the greatest of respects.

c1ue

09-04-07, 08:08 PM

I say the United States of America became a powerful and successful nation on the back of trade and that the decline that itulip is forecasting is as a result of turning your backs on the concepts so well laid out by the founding fathers, the rule of law.

Chris,

Actually I don't agree with your assertion above.

My view is that the United States was a backwater isolationist nobody nation from inception up well past the American Civil War.

The unbridled capitalist urges were fine so long as they were contained 'over there', but spilled over several times.

However, the worst of the American excesses were ameliorated by the fact that the prevailing political and economic powers in the world from 1850 to 1945 were too busy fighting amongst themselves.

Between the 1848 cycle of revolutions, machinations leading up to German unification in 1871, the British preoccupation with their overseas empire, and of course the collapse of several old time empires (Austro-Hungarian, Ottoman, Russia) culminating in WW I and WW II, the United States and the American continents were largely left to their own devices.

In fact, it could be argued that WW I and WW II combined to remove the mantle of economic supremacy from Europe and land it on the United States as the only even remotely industrial power not ravaged both in terms of human and economic/manufacturing capital.

That WW I served to break the US out of the lingering effects of the 1907 crash and WW II to similarly break the US out of the Great Depression - I ascribe that to luck as opposed to the Illuminati ;)

So you are correct that the US was built on trade, but I argue that it was trade to replace manufacturing base and infrastructure destroyed by war as opposed to superior economic architecture.

As for rule of law - it is exactly in this period of WW I and WW II prosperity that we see the formation of a number of regressive/repressive government organizations: IRS, Federal Reserve, and FBI after the 1907 crash; CIA and dollar going off of gold standard in WW II.

So without going too much further into tin foil hat territory, just consider how much of the US emergence as a superpower in the post WWII era is due to being the only uncrippled modern economy coupled with an inflationary currency to further aid expansion.

Chris Coles

09-05-07, 03:14 AM

c1ue,

What you illustrate is very welcome as it highlights another point that needs to be made. If you look back to the period during WW2 when, suddenly, the US was charged with creating armaments for Europe. You had the same process as we had had in the UK. Everyone was encouraged to make anything useful. So, if you could find a few employees and make, anything, you were of value and were invested in. No argument, get on and make it. Here in the UK, we had a very large furniture industry, spread right across the nation. Almost every one of those businesses were given contracts to produce parts for aircraft and by the time of the end of the war, while the nation appeared bankrupt, in fact there was a great deal of hidden wealth in what afterwards was called "The Black Economy".

So during a period of great upheaval, many new household name businesses were established that made for a solid foundation of economic success. By the end of the 1960's, the whole thing had changed. Yes, here in the UK the 1970's on the face of it were wonderful years of great prosperity. But in fact that decade marks the start of the decline here.

During the great wars, nations, not financial institutions, invested in their citizens to survive, for if they did not so invest, they would not survive. So the creation of new industry was an essential element in the national survival. In the US, most, if not all of the investment was made by government providing orders for arms which triggered massive investment to produce the arms to match the orders.

After WW2, here, the process stopped dead in its tracks. Between 1945 and 1970, various ways were found to try and establish new industry, but here we were, are, completely harnessed to the idea that it is government that creates jobs. Our financial institutions never ever got totally up to speed with the idea of taking the reins of investment in the nation from government. And that failure has ever since been at the heart of the grandest mistake made in the history of mankind... that the success and freedom of the people, comes not from access to capital and the freedom to try and venture even if they fail, but instead that freedom comes from democracy and political institutions.

A result is that, for example, the US has made a point of trying to impose political "democracy" all over the planet since the 1950's as the route to freedom for the people of various nations and has signally failed.

I am arguing that unless you provide access to capital to everyone who wants to improve their existence, you, without realising it, create a feudal culture that instead says, political democracy is the route to your personal improvement and if you want to own your own business; make a better life for your fellow citizens living around you, go take a hike because I am not going to let you have access to the capital you need to do that.

This is not about a dislike for my nations aristocracy, it is about a dislike for an attitude that says.... nothing to do with me, it is someone, anyone, else's responsibility to invest capital in you.

The incident that opened my own eyes to this was meeting two senior bankers, in London, at the invitation of the then Governor of The Bank of England, they both sat there and said, "It is the governments job to create jobs, not ours".

Capitalism is all about the investment of capital in a nation, not about HOLDING capital in a little pile of gold to be admired.

Freedom comes from investment, not democracy and until all our financial institutions recognise that investment in the people of a nation as their primary responsibility, nothing will change.

c1ue

09-05-07, 10:25 AM

Chris,

I agree with your sentiment in principle.

My view is just adjusted by pragmaticism in that even should you and I accumulate the capital to lend to new businesses, that capital is insignificant compared to what can be mustered by existing businesses, government, and central banks.

Our 'seed' capital thus will not be able to make an impact unless the inflationary tendencies of large corporations, government, and CBs is severely curbed.

For example, what use is creating a small retail business when the big box retail has economy of scale both in purchasing, hiring, real estate, etc etc?

This argument applies to all areas except those involving creativity.

Many people say that this is where the middle class can take haven in, but my argument is that this is EXACTLY what feudalism is: The nobility own everything except a few artisanal trades.

400 years ago it was blacksmithing, today it might be software development or genetic research.

But it does not make for a middle class comprising a significant part of the population.

My belief is that you wind up with a proportion similar to medieval feudalism: 80 peasants, 13 soldiers, 4 artisans, 2 bankers, 1 noble

As for the effects of the World Wars on Europe - it was not just the destroyed manufacturing and burgeoning defence industries, I actually referred to the human cost. Think of all of the human capital destroyed in the Somme in WW I, in the Eastern and invasion/liberation of Europe in WW II, and the effects on society.

http://www.economist.com/books/displaystory.cfm?story_id=9719496

Chris Coles

09-05-07, 11:39 AM

My view is just adjusted by pragmaticism in that even should you and I accumulate the capital to lend to new businesses, that capital is insignificant compared to what can be mustered by existing businesses, government, and central banks.

Our 'seed' capital thus will not be able to make an impact unless the inflationary tendencies of large corporations, government, and CBs is severely curbed.

c1ue,

That was precisely why I wrote the rules for A Capital Spillway Trust. It is impossible for any ordinary private individual to invest without significant risk. Yes, there are individuals that do so, but they are in a very small minority.

My point is that the correct way forward is to find a set of rules that any financial institution may use to invest small capital sums of equity and working capital into grass roots businesses in such a way that the originators of the business remain the owners of the business and thus are free and become a part of a free enterprise business culture in their local community. That they in turn become responsible for the employment of their local community which in turn sees their local savings re-invested right back at the local level in their community.

Local employment. Local savings re-invested. Local community with every reason to help the small business survive and prosper. Failure accepted as a part of the principle. Business owner cannot pay themselves more than a simple wage unless either the business is profitable, or, if it becomes what I describe as a subsistence business, (paying its way but not significantly profitable), then the owner is encouraged to buy out the capital input at an agreed rate returning the capital to the trust for further investment.

The problem with all those millions of people in poor communities is that they do not have any access to capital. If they manage to get some investment it is feudal, the investor expects to "own" the business, so they are never free. Neither do they have any experience of the gains to their community from honest investment. Nor do they have any experience of a successful capitalist system because they have always been excluded.

Giving them a vote in an election does nothing for them.

The greatest freedom is to be your own employer, carrying responsibility for the lives and aspirations of all the others around you in your local community. Paying their wages, giving them what they need to become honest citizens.

The only group which has the capital are the financial institutions. At present the managers of those institutions expect to be paid as though they are the old Lord of the land they survey and to own every business they invest in. That is feudal.

Feudalism has been shown, for centuries, not to work.

We must find a new way forward that satisfies the free enterprise needs of the majority in every community on the planet.

Surely, the greater the prosperity of any community, the greater the drive towards peaceful, honest communities that have no interest in dishonesty terrorism and war?

I repeat again: Capitalism is all about investment of capital, not holding capital. Investment must leave people free, not serfs to a single local investor.

c1ue

09-05-07, 01:24 PM

Chris,

I admire your aims, I just don't believe that the non-Utopic human population can successfully implement them.

Were people really so egalitarian, Communism would work.

Why even bother with 'money' when ultimately it could be "From each, according to his ability; to each, according to his need". (Karl Marx)

Furthermore you are discounting the impact of the megacorporation on the business ecosystem. As I noted before, there are very few commodity based businesses where a megacorporation cannot destroy smaller competitors. The financial industry furthermore knows that there is far more profit in these megacorporations than thousands of shopkeepers.

Some more famous quotes:

"Advocates of capitalism are very apt to appeal to the sacred principles of liberty, which are embodied in one maxim: The fortunate must not be restrained in the exercise of tyranny over the unfortunate." - Bertrand Russell

"Capital is dead labor, which, vampire-like, lives only by sucking living labor, and lives the more, the more labor it sucks." - Karl Marx

I wish you success in your endeavours, but I will continue to closely guard my financial future from interference by governmental agencies and financial institutions.

bart

09-05-07, 01:33 PM

Capitalism without moral hazard is not capitalism.

"The inherent vice of capitalism is the unequal sharing of the blessings. The inherent blessing of socialism is the equal sharing of misery."
-- Winston Churchill

Chris Coles

09-05-07, 04:22 PM

I am not sure what to say. I am thus seen as a cross between a Marxist and a socialist for advocating a free enterprise form of capitalism, where the manager of the business owns the business.

Wow!

bart

09-05-07, 05:09 PM

I am not sure what to say. I am thus seen as a cross between a Marxist and a socialist for advocating a free enterprise form of capitalism, where the manager of the business owns the business.

Wow!

If that response was about my comment, that's not how I see you.
I still can't tell what your full views are... not so much about the ills and nasty history of the US, UK, CIA, etc. (that's not in question), but more about the ills and issues and history etc. on the other side(s).

In my view, it takes at least *three* to make a "mess"... at least one is behind the scenes to a greater or lesser degree.

c1ue

09-05-07, 05:30 PM

Chris,

I don't see you as either communist or socialist.

What I said is that your plan is admirable, but my opinion is that it is unworkable due to human collective nature.

I then pointed out that Communism also theoretically should work - but again the human collective nature found ways to gain and maintain power even within the concept of communal existence and the removal of personal property.

I think what we need is a nice tailored meme which removes all human desire for empowerment over others and greed beyond what is needed for self.

Of course, then we'd be termites :o

Lukester

09-05-07, 09:17 PM

Chris -

You wrote:

<< ... correct way forward ... to invest small capital sums... in such a way that originators of business remain the owners of the business and thus are free ..... >>

Your model envisions a significant number of private lenders being incentivized within this system to enter into a self-rewarding cycle of funding business startups?

How do you incentivize an increasing flow of private capital to startups, while your model requires that the control of the collateral for these loans is legislated actively from the get-go to the borrower to protect them and cause their numbers to flourish, and yet therefore control of the collateral is legislated away from the lender?

Don't business startups launched on borrowed capital in reality exist with the majority of their equity initially owned by the venture money? The more you lock up the controlling interest on those deployed funds for the borrower, the more you sharpen the risk for the lender. This should act in a very notable way to shrink the pool of available capital.

You suggest a more dynamic economy can be fostered, where money from the private sector can be 'channeled' to empower the small business borrower - but if majority control of the business (a.k.a. the collateral in micro-caps) in these startups is legislated to the borrower almost from the get-go, while 90% plus of the equity in that business is in reality still the risk-capital of the lender, how does your legislation incentivize these lenders to bother lending at all? Such a legislation translates directly as risk for the lender.

I appreciate that the producer of goods has more merit than the holder of capital. I appreciate that un-deployed capital is potentially 'dead productivity' although at least some of these lenders may represent astute investors and savers. But how does a government policy which legislates control of deployed funds (or their collateral equivalent) to the recipient before they have amortized a large part of the borrowed money via growth, incentivize a private holder of capital to lend more, or indeed to lend at all?

This might be accomplished with legislative "persuasion", but perhaps not spontaneously?

Lending to small caps is risky. The pool of lender money not averse to risk may be small, it may be erratic, it may even be dynamic and / or growing, but if it becomes in any way legislated or assisted to flow to borrowers by a statute, it probably vanishes in a hurry.

It seems to me that if you legislate tools for 'encouragement' channeling growing streams of funds to risky small-caps, you'll merely accomplish capital flight. Further, any time you see a country instituting capital controls, there is something in that country's environment which has certainly become toxic for the prospering or proliferation of available risk capital, so that inducing capital to flow to small business spontaneously is then "out the window".

This idea might work best when funds for venture startups were administered from a government entity or government sponsored entity - which had been moulded to your policy guidelines - but if this idea were thrown out to the private community of holders of capital, with their notoriously fickle and self-centered motivations, you might find capital flows were singularly reluctant to deploy at all.

Few people are probably against the encouragement of small business venture capital, as it would be a big improvement over the scorched earth effect which large corporations exert on small business - the question is merely whether this legislated approach for encouraging venture capital to deploy further to small business acknowledges the patently self-centered movement of private capital evident everywhere throughout the past several hundred years of capitalism.

How do you induce owners of funds to risk their capital? By trussing them up with a government legislation, or by promising them less risk and more reward? If risk is high, they want to own your ass. If risk is lower, some of them will cut you some slack - maybe.

Chris Coles

09-06-07, 04:26 AM

Thank you both for that. Appreciated. The answer to the question of a meme is simple and is already recognised: Free Enterprise.

From my perspective, what has gone wrong is that society made the very simple mistake of believing that freedom comes from political institutions alone. It does not. To be completely free, you have to be able to live your life, (yes, within the constraints of your societies cultural rules), free from any control by another individual in your society.

The whole idea of competition demands that, to be able to compete, you are not constrained by anyone or anything that can in any way prevent you from taking actions and making decisions that only you see as in your interest to so decide. The moment you force an individual to take their capital from anyone that wishes to CONTROL their actions, you immediately remove the freedom to decide for themselves what is the right way forward. In that way you additionally, reduce the thinking capacity of your industrial and business community to the thinking capacity of the number of individuals in CONTROL.

Control means someone saying; regardless of what YOU feel is the right direction to take, you are going to go in only MY direction, under my control. I argue that that simple process is in fact feudal.

<O:p</O:p
<O:p</O:p
The one thing missing has always been free access to capital.

If you go to town and, in the fully free markets available, buy, anything... let us use as an example, a pound of potatoes. Once you have purchased the potatoes, no one may say to you, you can only boil those potatoes, I forbid you to roast them. Yes, you will say that is a ridiculous example. I answer, not at all. A free market is EXACTLY that, FREE. You decide, from that moment onwards what you are going to do, (yes, within the law), with whatever you have purchased. No one may intervene. Indeed, I will argue you will defend your right to do exactly as you please with anything you have ever purchased.

Your car, home, gun, food, you name it except capital.

I am saying that by far the majority of our problems in our financial world are caused by a lack of access to a free marketplace which should give everyone free enterprise access to the capital we need to create new business, employment, new opportunity.... to create... whatever we can imagine will benefit and be attractive as a potential purchase by a potential customer. The moment you narrow down access to the capital needed to do that, you narrow down the potential to compete within society to the imaginative capacity of those in control of access to the capital. You lose the vitality of a free society and become a feudal society where the only action you can take is dictated by whomever controls access to the capital. Result?

Vast amounts of capital going into reducing the competitive capacity of the nation, yours and mine, by racking up the value of fixed assets like the family home, while, at the same time destroying the manufacturing capacity of the nation, (for example, you lost almost all your steel mills in the last fifteen years... yes, go on.. check that out). Or another example, you do not have enough coded welders to keep your existing fuel refineries in good repair. All the small businesses you relied on to give a constant supply of such skills has disappeared.

You may purchase anything in a free marketplace in a free society. Indeed, the ONE thing that marks out a free society is access to free markets for all you need. Nothing to do with the politics, other than our multi-party system is charged with the maintenance of those free markets. Everyone, from Magna Carta onwards, made the simple mistake of not including capital markets in their thinking.

Free Enterprise. Free citizens. A free nation; demands access to free markets for everything you need to be able to work as a social group. There must be free markets for capital to build a business, or everything you do is quite naturally.... feudal. Feudalism simply does not work. Does not create a fully free society, does not leave every citizen free to make their own decisions as to what they believe is the best solution to anything they perceive they can sell to their fellow citizens. But, more than anything is not competitive. Cannot be fully competitive because you are always constrained by the thinking of the individual or group that supplied the capital.

Yes, there have to be rules that the existing suppliers of capital can accept. That was why I came up with A Capital Spillway Trust and a set of rules that give access to capital without control. And, please, do not say anyone needs control when no one needs or desires or accepts control for any other input to society. You do not accept your bank has any right to tell you what colour you may paint the walls of you family home, so why do we accept that the provider of capital should have complete control over the business you wish to create?

Aha! You will say that, without complete control, no one can be certain that the recipient of the capital will not just run off with it or use it injudiciously. But you could make that argument for absolutely anything that anyone purchases in any other free marketplace. The answer is that by far the majority in any society will see it as in their interests to always act in the best interests of their community and society. By far the majority obey the rules. THAT is why I created a simple set of rules for the ongoing investment of capital into new grass roots businesses and creative individuals such as inventors and why I expect them to succeed.

You need a society where everyone has a vested interest in your success. That society is a free enterprise society where the manager of the business is free and owns the business and thus has every interest in the ongoing success of both his business and the society he employs and with whom he trades that surrounds them in their everyday lives.

I stand for free enterprise. Who will stand with me?

Lukester, I will answer your questions later today, I have only discovered your detailed question by trying to post this answer to the two previous posts. (If you try and preview, you lose the lot if the server is busy so I now write in Word and copy to prevent the loss).

Lukester

09-06-07, 07:42 AM

Chris -

My best suggestion would be to not write anything further about the creativity of the Capital Spillway Trust from the vantage point of the borrowers. This is not for our benefit, but to increase the odds your project gets adopted by any municipality or local government.

Instead, try an exploration of what a prodigious and astute small time saver with funds to invest might think about risk. How much risk does he like to take? Probably as little as possible. How much does he want to set the cost of funds at, if there is high risk? Probably very high. How many teeth does he want his recourse to his principal to have, in the initial loan contract? Probably a lot.

Why would he even want to invest in startups, if he can get as good or better interest rate and gains from investing in a consumer staples multinational company that pays him a big fat dividend? If over the decades we see a good portion of venture capital migrate away from small business startups and into safer large cap investment, this shows us the drying up of venture capital occurred due to natural capital flows. It's not an estimation of which is bad or good - it's merely an empirical observation of what occurred naturally as a growing portion of capital sought return with less risk.

Hence redirecting those capital flows to preserve small buisness is not necessarily rediscovering natural economies, but rather a synthetic redirection of the natural flows of funding which have recently been observed to occur.

Which economic planning is a more likely to flow spontaneously, i.e. without government legislated engineering : An economic program which respects the previously observed natural capital flows (over time small investors favor larger caps and so starve small startups of a larger pool of capital), or an economic program which seeks by legislation to redirect that previously observed flow of capital to grow further into the small cap risk area?

If you legislate a system to "encourage" the small investor to pool his money into high risk startups where the law keeps the borrower in the driver's seat - so this small lender cannot actively steer which of the 10,000 microcap businesses actually borrows it - maybe this prodigious yet risk averse saver will revolt, and choose to have nothing to do with your program?

Explore the idea from the small private lender's perspective - understand if someone spent forty years to save investable capital they are not going to be wildly enthusiastic of a government program which requires them to channel it towards risk. Understand how the vast majority of the small investors would flee unnecessary risk like a scalded cat - then you will obtain a glimpse of where the link is in your project which causes others to sound skeptical.

Forget the borrower, and their beneficial effect on the economy. That's putting the cart before the horse. Worry instead about what could possibly motivate the small private lender instead. After all, everyone and their uncle has a business startup idea. The tough part is to get private money to get interested in taking on your risk.

BiscayneSunrise

09-06-07, 10:52 AM

Envy the Canadians however, for whom warming will thaw out a vast continent-wide virgin territory to farming and natural resource production - 30 million people with a continent of resources

Reminds me of a joke, first heard from Jim Dines, I think:

When God was creating the earth, he paused and mentioned to his Archangel, Gabriel: Now I am going to make the most special country in the world. It will have vast areas of fertile land, and some of the richest deposits of minerals. It will be surrounded on all sides by oceans, full of fish and other resources. The land will be filled with lakes and rivers and the people living there will be the happiest and most generous people on earth. And I will call this country, Canada!

To which the angel replied, well God, that is all well and good but don't you think you are being overly generous to these so called Canadians?

And God says, No, Just wait and see who I give them as neighbors!

Chris Coles

09-06-07, 12:08 PM

Lukester,

I do thank you for the varied questions.

My starting point that prompted me to put the idea of A Capital Spillway Trust on the Internet in the way that I have is that I own three US patents and one Japanese patent in telecoms and believe, (with good reason as for example the Pentagon have been kind enough to tell me to my face that they are infringing and that they would ignore me), they are perhaps very valuable. So my thinking always was to use the royalty income from the patents, (which might reach more than nine figures), and put my own money where my mouth is and take the full hit financially myself to carry out a test of my thinking. As you can guess, owning patents and getting at the royalties is a very moot exercise. Instead, I have been working on another front entirely which should, within a reasonable timescale, bring sufficient income to be able to bring a little legal muscle to bear which would bring me back to a test. So from the outset, I have not tried to "sell" the concept to anyone but enjoy the opportunity to debate the principles with an intelligent audience. Debate is always the best way forward with any new thinking.

I do not, nor have I ever; seen this as a vehicle for private investors. Indeed, I totally agree with all the basic points you have raised. But that was at the core of my own thinking. Over the years I have, from time to time, raised investment from private sources such as individuals. There are several aspects that stand out. At that level, you need to find someone that has an interest in the specific area of business or technology you are about to address. If they are already in that area of business, they will see you as a competitor to their existing investment. if they are not in that area, they will duck out simply because they do NOT understand the business. Again, if you are in a completely new area of technology, you are very unlikely to find anyone that totally understands the principles and thus can feel totally comfortable with where you are going. If you approach a major business, then the opposite occurs. For example, in one case another department of one of the largest electronic businesses in the world campaigned fiercely against me because they saw my ideas as a direct competitor to their own product still under development. By the time I had reached that point I was out of funds and had to stop regardless that the product was a full world class item. (might still be, but that is another matter).

So I discovered that, regardless of the individual merits, my ideas were going begging for want of that initial "push" and even more importantly, I came to realise that there are countless others in exactly the same position. So the challenge was, not so much to gain investment for myself, but to see how the overall problem should be best addressed. What were, are, the main stumbling blocks? I then got a bit of luck and got in front of a major director of a very large Japanese corporation who was willing to help with the debate by taking me through the process as the Japanese see it. (No, he was not in the field of interest and in any case, Japanese business does not invest in a European inventors ideas). But he gave me the lowdown on how they get to the kernel of new thinking in their corporate environment. Those conversations were very eye opening. The Japanese see new thinking in an altogether different light. Anyone with an idea, any new idea, for a business, or a product, must be encouraged. Remember, after WW2 they were a completely defeated nation with, essentially, nothing. So you had an idea for a product you were the answer to their prayers. You were, are, placed at the top of their industrial society and you ask for investment, you get it in spades. So they came up with some simple rules. You have an idea, you get a man year value input to try and build a prototype. If the initial idea shows promise, you get ten man years value to bring the initial thinking to first full prototype and if that looks worthwhile, you get one hundred man years value to bring it to the marketplace. Not to profit, to marketplace. You get roughly ten or eleven years to arrive at profit. The result is seen, for example, a Canon photocopy shop has a new photocopier model every three months, on average. You never see Japanese products sitting on the shelves unsold, but you do see new models arriving as soon as the stock has been sold. A constant flow of new products. So imagine the numbers that have fallen by the wayside?

Japanese funding comes from their primary financial institutions. They see their responsibility as being to the nation and the nations industry first and foremost. The result is that Japan is still a major exporter, regardless of the strength of China and India.

The next aspect is even more important, the relative instability of new start up businesses. In that case the problem is almost always recognised as a result of under capitalisation. So where you may make a risky loan to a small cap, the underlying reason for your increased risk is the under capitalisation of the business. So that requires an increase of the capital structure.

I have never subscribed to the need for legislation of any sort. Indeed, the more government gets involved in business, the worse the business environment. The small cap does not need any legislation, they need better access to capital. They do not need loans. One of the most striking underlying problems today is the trend towards setting up a new business with a very small capital input and a very large loan. It does everything for the VC who wants to be able to get out at a moments notice and nothing at all for the long term development of the business.

So now I turn to how I see this going forward. The first question to ask is what do we call a savings institution? It is not government. Neither is it private. Yes, it sells you the idea it is there to provide a return on your private savings, but what is its PRIMARY function? If you can say its function is to provide you with a safe income from your savings, I ask, does it matter where the income comes from? Oh! Yes!, in the same way we have allowed what I call a feudal culture to embed itself into our long term thinking about investment of capital, we have also fallen into the trap of believing that where the funds are invested does not matter any more as the most important aspect is a safe income.

From that starting point, we have permitted the evolution of our savings institutions into becoming banks and the evolution of investment for the capital needs of the nation into trade in existing companies, by those banks. So a big part of the debate I believe I set into motion is to ask again, what is the primary function of the savings of the nation? Not your personal savings, where I believe the points you raise about private lenders, borrowed capital, risk, capital flight are all very relevant. But instead, the major pools of savings of the ordinary people.

If you now say that such capital investment should come from government tax income via new legislation, you are in effect saying that the original idea of a capitalist society has ended. That we must from now onwards see new investment as being so risky, we are not going to do that any more, so the government must. In that case, I say, I might as well move to Caracas as soon as possible as that is exactly what Chavez is doing. We all know, for certain, that in the end, government investment into industry does not make for a successful society.

I believe the only answer is to clarify our thinking about what we call the concept of a savings institution. By a savings institution, I mean an organisation such as Fidelity. There are about 1,300 of them in the US. I believe the answer is that they will have to believe it is in their best interest to follow my thinking and see that there are definite advantages to the local communities they obtain their savings from, by allowing a part of their vast pool of savings to be re-invested back into those communities. Indeed, it was precisely that aspect that made me decide to carry out the first test of my thinking using my own money. By so doing they can see for themselves.

I will give you a scenario. Say I set up a Capital Spillway Trust. It invests in many new businesses whose employees all now save their savings with my primary source of capital. Instead of my demographic being spread between a few successful individuals and a very large number of non savers, many on state benefits, my demographic is now that the majority of the local communities I serve are now in full time employment. Savings are up as it will be a basic aspect that you have a job because of the saving being invested into your community, so we will encourage everyone so employed to save and pass back the investment into a new capital pool. Suddenly, I am taking customers from the traditional savings institution who, instead, has made their investments outside of the community and now the savers prefer to see their local community more prosperous and as such because they see where their savings are going, back into their community, they prefer to save with us.

Good old fashioned competition will break the reluctance of the existing industry. The notoriously fickle and self centred holders of capital will see from simple competition, that it is in their interest to address the new marketplace. The only worthwhile mechanism in a free society is good old fashioned competition.

So, no legislation. No lending by small private capital holders. Only equity capital injections as now the drive is towards a much more stable small cap business environment, (which the small private investor may become very interested in helping an already stable business move on up the ladder). Reduced risk all round as the majority of start ups will be properly capitalised. Employees know their jobs come from such investment and that their savings have helped create the job. So they will provide the balancing force to ensure the new business owner plays by the rules. The new business owner cannot increase their income unless profitable, so they will always be able to show that they are making a sacrifice for the local community. By the same token, the business owner will be able to argue they cannot afford to pay higher wages unless the business is fully profitable, keeping a tight lid on local wages. (Look at me, I cannot pay myself more, so you have to help me get to profit for any of us to prosper further).

I believe that a test of the concept of a Capital Spillway Trust will bring sufficient local rewards as to show that it will be in the best interest of the savings institutions to follow the lead, or lose their customer base.

The initial capital should all come from taking a small proportion of the largest pools of savings. That the only way forward is through the simple concept of the managers of the savings seeing that it is in their best interest to get involved.

That no one will do this until they can see with their own eyes, the potential benefits. Someone must show the way, and, it was always thus.

I do not believe we can reduce risk. However, I do believe that there is a very large potential for a raft of completely new businesses that remain outside of the current interest of the VC community. Indeed, it is my understanding that they pass on thousands of business prospects for no other reason than the proposal is "not to their criteria". In the end, everyone will prosper more because of the increased vitality of the small cap community. Instead of trying to take a start-up from day one to major player in 30 months, the VC community will have a much wider marketplace with the companies worth taking forward already having a stable customer base, or proven technology.

The evolution, from start-up to wherever the company finally stabilises will be over a much longer timescale. While that initial capitalisation will in many cases still run out, the capital will have been lawfully invested into all the usual business costs and thus the money is not thrown up against a wall, but serves to vitalise the local community and, as the unsuccessful individuals will not now be bankrupt, (I believe success by your own striving is by far the better incentive, not fear of failure as now), the overall disruption to the financial stability of the community is very much lower.

The only answer is to try it and see if I am correct. And I am not going to try and say, at any point in this debate, that I have all the answers. I simply say, I believe that, based upon my own experience, this will make a significant difference to the economy of any community that takes this up and runs with the idea. If I can lay my hands on a slice of the royalties I am owed, I will do this test myself, with my own funds. and by so doing, put my money where my mouth is.

Lukester

09-06-07, 01:00 PM

Chris -

Very interesting description. I am not qualified to delve into it further, but there are others here who probably are. I look forward to reading any further comment on your outline.

Due to considerable inertia in the business model around you which you seek to change, you should not allocate all the capital which you manage to secure from your royalties to testing your microcap funding idea in the market place.

Risk to that capital will be extremely high for you. Better to be cautious.

Chris Coles

09-06-07, 02:49 PM

Risk to that capital will be extremely high for you. Better to be cautious.

I disagree in that it is important to really "go for it". I do not think this is something that can be approached diffidently, it will need to be at least $100m and perhaps into a very small geographic area. Somewhere VERY challenging perhaps? The whole idea is not to hold back but instead let the process have its wings and see what comes out of it.

If my calculations are proved correct, the real difference will be in the local prosperity. A bit like the difference between a desert and a rain forest. The more you put in the better the local business environment becomes, the greater success.

But, yes, I do have other interests and for the time being this is simply a debate. I am going to make my fortune elsewhere, of that I am absolutely certain. But this will happen one day and it too will succeed.

I do once again thank you for your input, as also everyone else too. Thanks, everyone.

BiscayneSunrise

09-06-07, 04:56 PM

But on a more serious note Lukester, you say Dines has a well researched portfolio. Could you expand on that a bit more?

I subscribe to TDL and find Dines informative on macro issues and entertaining but he has very little to say about the fundamnentals of his specific picks.

Chris Coles

09-12-07, 09:45 AM

This is getting carried away with some absurd hyperbole - the quote makes no distinction between George W. Bush's intervention to oust Saddam and the wholesale systematic terror for terror's own sake of the likes of Stalin, Mao Tse Tung, Hitler, Pol Pot, Idi Amin, the Spanish Inquisitors, Ghengis Khan, or any of an entire host of men personally responsible for intentionally consigning millions to the more gruesome and imaginatively devised deaths - the above are men who actively and very pragmatically perfected the practice of imposing mass civilian terror as an ordinary daily tool of government.

I'm no Bush fan. I'll readily acknowledge this US president's intervention was bloody, ill advised, was ill executed, and has put some blood directly on it's hands to answer for - but it falls so far short of the above cast of characters in motivation and degree, as to make the comparison to them merely rhetorical nonsense.

Seems you and I have a diametrically different understanding of practically all of these topics Rajiv. Please pardon my wholehearted disagreement with you here.

May I suggest that you all read this.

http://www.opednews.com/articles/opedne_michael__070907_was_a_covert_attempt.htm

goprisko

09-12-07, 11:00 AM

not an ideological lunk like Chavez. Brazil will take wing, while Venezuela will founder.
Seems quite a lot of history is missing here......... First off.. Chavez is a mestizo, a brown man descended from Amerindian Stock, Lula, is of european descent. A little racism perhaps???

Forgotten are the missing manhole covers... sold by the poor to buy food... during the good old days of white market oriented supremacy.

Forgotten are the blatant attempts to assassinate Chavez by the CIA no less. He might have taken things personally. I would.

Forgotten is the fact that petroleanos Venezuela was ridden with cronies of the former regime. actively subverted the elected government. Yes, Chavez was elected, by all accounts honestly, which Bush cannot claim.

Forgotten is the effort by the oil majors to use their financial clout to subvert the government.

Lula mixes socialist programs to assist the poor with a firm bias towards free markets to encourage foreign investment. Under his wise guidance, Brazil's economy is liberalising and soaring

What exactly is a "Free Market" free for whom?? for US corporations and the AID and Soros to manipulate with fiat dollars??? Like we did to the meztisos of Mexico when we destroyed their centuries old communal land system and threw them on the street?

Like free as in land with out property taxes?? ALA United Fruit??? YOU DID KNOW THAT YOUR TAX DOLLARS GO TO SUPPORTING TAX SCOFFLAWS DIDN"T YOU????

Here is the eye-opening paradox which I so much admire - Lula is a hero both to the poorest,

Here is a greater paradox.... Chavez is worshipped by the poor of Venezuela for schools, medical clinics, empowerment projects, phone service.... etal...

Look at the collapsing GDP in Venezuela - at the national petroleum company, the nation's lifeblood -

Collapsing what??? Venezuela has been growing since income was returned to the working class.....

Chavez trumpets his initiatives to buy 100,000 kalashnikovs to equip his personal militia to 'protect the nation' -

If you had the world's greatest superpower manning bases just 30KM off your coast and making threats too kill you.... or invade from Colombia... you might want a few rifles... in friendly hands too....

I mention Lula of Brasil in case you thought my objections were mere knee jerk reactions of a conservative. My objections are emphatically not of that nature.

What exactly is a conservative? Clinton was a liberal... balanced budget paying down the national debt. Respect for international law...

Bush .... 2 trillion in additional debt in 8 years..... violations of the Geneva Convention... of the Nurenburg Code... ponzi realestate bubbles... PATRIOT act.... unitary Executive.... Conservative??

I just think the idea is a fraud upon the entire nation - that you have to force progress by allowing a man with a supposedly superior conscience for the poor, i.e. Chavez (NOT) to take over the whole show and give the poor some social justice. It's a fraud upon his nation.[/quote]

The idea that a mestizo, an amerindian can lead anything???? When whites are SUPERIOR???

OR....

the reality that Chavez supports CUBA... has stopped the attempt to subvert CUBA's revolution... so Bacardi can't steal the land back...
They are going to pay 50 years back property taxes to the US installed government aren't they???? Oh, I forgot, the rich don't pay taxes... send their kids to die in Iraq or Yemen or Somalia... just the kikes, kinks, and yikes....

Well, one of those kids is mine... and I had him for something better than to provide fodder for some WASP to get rich via thievery and chicanery.

SO....

Chavez at least doesn't kill Bishops delivering sermons in the national cathedral like the CIA did.

Chavez doesn't kill priests and rape nuns on a bus like the CIA did.

Chavez doesn't twist the arms of governments and their banks illegally for political reasons like the UST and FED do....

Why....

Don't you get some real principles.... and indict Bush etal. for war crimes??
OR.......
Just a violation of the UCMJ... AWOL over 30 days in time of war...

DESERTION.....

You know.....

DESERTION... leaving one's buddies...... to FUCK women .... I'm told....

Isn't that what he did to the nation on 9/11?? disable the CAP??? Leave it defenseless??
DESERTION......... yellow belly coward DESERTION.....

INDY

Lukester

09-12-07, 12:50 PM

GOPRISKO - I earnestly implore, that you (very gingerly, so as to avoid further damage to your apparatus) insert this small kernel of an insight within your self-righteously agitated BRAIN-PAN - your suggestion that I must be a bigot - because I despise Chavez - because ... (canned audience asks breathlessly - WHY? WHY, MUST YOU DESPISE CHAVEZ, LUKESTER? ) because he is a "Mestizo" and not "White" !!! ? (Gasp !!) :p

You need to be careful how you sling this kind of wet cardboard blustering around. I mean, how could you have a hamster's clue what my views are on ethnic diversity? Have I told you? Have you found other comments of mine on this website that might give you a clue I was a CLOSET RACIST? (Gasp!!)

I was raised overseas, lived part of my childhood in West Africa, have lived, and been culturally and academically educated in six countries over fifty years and traveled through about 30+. I'm probably one of the most curious and genuinely friendly people in the world about meeting people from new cultures. I get on famously well with people from every walk of life, from every part of the world.

I'm curious about you, as many Americans don't get abroad nearly as much as people in other parts of the world. How many countries have you ever visited? Have you lived abroad? Do you own a passport? How many languages do you speak?

I'd be ever so pleased to hear your crumbs of Spanish, to know (as I suspect) they may be elocuted with a gringo drawl thick enough to have every shopkeeper south of the Rio Grande routinely seek to overcharge you? It's terrible the way foreigners overcharge Gringos, isn't it? :D

Where do you come by this comical moral certitude, that you can identify a racist by adding up how much they merely disagree with your own views? I am absolutely overcome, stunned by the searing rationality of your Cartesian logic here.

Please, don't work at it so hard !!! You do not need to wear your heart on your sleeve to convince the world you are God's (PBUHN) scourge to closet bigots!

Indeed, I am so impressed by the world-emancipating fire you carry in your belly, I must kneel in abject shame and ask you to declare to the world that I've REFORMED, yes, REFORMED!, and no longer harbor virulent hatred for people who are not Caucasian! :p :p :p :p :p ( How did you know I keep a copy of Mein Kampf in my carry-on luggage whenever I travel?? - HOW COULD YOU HAVE GUESSED IT!!! OOHHHH! THE SHAME !!! )

PUHLEEESE ! THINK before you utter foolery. Do not resort to suggesting I am a bigot to be claiming that Chavez is indeed a thug, just because he is "Not White". :eek: :eek: :eek: :eek:

Aggghh! I think I need to retch my breakfast up here ( kneels over to retch some partially digested cornflakes with masticated raisins into a spotless trash bin, while seeing a ghastly hallucinated reflection of GOPRISKO's face in the dribbles that land on the bottom of the tin can ).

Your beloved Chavez is a THUG, for the painfully evident reason that he's shutting down all the newspapers or organizations with a voice in that country who are inclined to make the smallest peep of complaint about his curtailment of their constitutional rights!

Gee - I thought the hallmark of an emancipator was someone who 'carried the crowd' by force of moral conviction, rather than by force of goon squads?

Listen to me my dear GOPRISKO, you can argue with me, but please have the sense of decency to not ever claim I take these positions because I am somebody's FOOL OF A RACIST.

Your politically correct wits are traveling along a RAIL (OK, maybe TWO RAILS, to keep you from merely tipping over and spinning the wheels helplessly). Your beloved Chavez is a THUG. Your beloved Chavez is very actively muzzling the free press in Venezuela (if they publish the slightest criticism of him he shuts them down - SO MUCH FOR A FREE PRESS!). This has been documented all over the international press for YEARS. Or when he's not pursuing that, he's very industriously muzzling any trade unionist foolish enough to try uttering a peep against him!

You admire Chavez? Fine, you can adopt him. You can snuggle up with him and get a nice bear-hug and a photo-op, if that will put a glow in your heart.

I need your squeaky high-toned denunciations of my presumed bigotry like I need a tape-worm in my head. Go find someone else to squeak at! Go travel and meet some Americans abroad, and understand they are not the bigots you presume from the morally self-congratulatory vantage point of your sprung armchair.

But please take your wet-cardboard moral righteousness elsewhere, as I'm not a suitable candidate for you! OK?