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May 21, 2009

Watching Obama Morph Into Dick Cheney

by Paul Craig Roberts, Antiwar - May 21, 2009

America has lost her soul, and so has her president.

A despairing country elected a president who promised change. Americans arrived from every state to witness in bitter cold Obama’s swearing-in ceremony. The mall was packed in a way that it has never been for any other president.

The people’s good will toward Obama and the expectations they had for him were sufficient for Obama to end the gratuitous wars and enact major reforms. But Obama has deserted the people for the interests. He is relying on his non-threatening demeanor and rhetoric to convince the people that change is underway.

The change that we are witnessing is in Obama, not in policies. Obama is morphing into Dick Cheney.

Obama has not been in office four months and already a book could be written about his broken promises.

Obama said he would close the torture prison, Guantanamo, and abolish the kangaroo courts known as military tribunals. But now he says he is going to reform the tribunals and continue the process, but without confessions obtained with torture. Getting behind Obama’s validation of the Bush/Cheney policy, House Democrats pulled the budget funding that was to be used for closing Guantanamo.

The policy of kidnapping people (usually on the basis of disinformation supplied by their enemies) and whisking them off to Third World prisons to be interrogated is to be continued. Again, Obama has substituted a "reform" for his promise to abolish an illegal policy. Rendition, Obama says, has also been reformed and will no longer involve torture. How would anyone know? Is Obama going to assign a U.S. government agent to watch over the treatment given to disappeared people by Third World thugs? Given the proclivity of American police to brutalize U.S. citizens, nothing can save the victims of rendition from torture.

Obama has defended the Bush/Cheney warrantless wiretapping program run by the National Security Agency and broadened the government’s legal argument that "sovereign immunity" protects government officials from prosecution and civil suits when they violate U.S. law and constitutional protections of citizens. Obama’s Justice Department has taken up the defense of Donald Rumsfeld against a case brought by detainees whose rights Rumsfeld violated.

In a signing statement this month, Obama abandoned his promise to protect whistleblowers who give information of executive branch illegality to Congress.

Obama is making even more expansive claims of executive power than Bush. As Bruce Fein puts it: "In principle, President Obama is maintaining that victims of constitutional wrongdoing by the U.S. government should be denied a remedy in order to prevent the American people and the world at large from learning of the lawlessness perpetrated in the name of national security and exacting political and legal accountability."

Obama, in other words, is committed to covering up the Bush regime’s crimes and to ensuring that his own regime can continue to operate in the same illegal and unconstitutional ways.

Obama is fighting the release of the latest batch of horrific torture photos that have come to light. Obama claims that release of the photos would anger insurgents and cause them to kill our troops. That, of course, is nonsense. Those resisting occupation of their land by U.S. troops and NATO mercenaries are already dedicated to killing our troops, and they know that Americans torture whomever they capture. Obama is fighting the release of the photos because he knows the barbaric image that the photos present of the U.S. military will undermine the public’s support for the wars that enrich the military/security complex, appease the Israel Lobby, and repay the campaign contributions that elect the U.S. government.

As for bringing the troops home from Iraq, this promise, too, has been reformed. To the consternation of his supporters, Obama is leaving 50,000 U.S. soldiers in Iraq. The others are being sent to Afghanistan and to Pakistan, where on Obama’s watch war has broken out big time with already one million refugees from the indiscriminate bombing of civilians.

Meanwhile, war with Iran remains a possibility, and at Washington’s insistence, NATO is conducting war games on former Soviet territory, thus laying the groundwork for future enrichment of the U.S. military/security complex. The steeply rising U.S. unemployment rate will provide the needed troops for Obama’s expanding wars.

Obama can give a great speech without mangling the language. He can smile and make people believe his rhetoric. The world, or much of it, seems to be content with the soft words that now drape Dick Cheney’s policies in pursuit of executive supremacy and U.S. hegemony. Source

(my comment:) Some "change" indeed. From french kissing:

to bowing:

Self-Fulfilling Prophets Lead to Self-Fulfilling Profits

An important short article here with the message "this rally is fake". Quote:

"... just be aware that this market rally is being propped up by someone (or several people), NOT because corporate profits or economic conditions are improving." Read all here

Chinese commies are evil as well, but they are NOT stupid

Must read of today, from newskontentkonsult [my emphasis]:

"Sabre rattling with talk of "aircraft carrier battle groups" is the gunboat diplomacy Ambrose has begun to allude to; several times he has hinted that the US should use its military might to force purchase of its debt. The UK will be cap in hand to the IMF before the year is out, imo..

Et tu Tokyo? If Washington is counting on Japan to act as last-resort buyer of US dollar bonds, it may have to think again. Masaharu Nakagawa, finance chief of the Democratic Party of Japan (DPJ), told the BBC that his country should not purchase any more US debt unless issued in yen as "Samurai" bonds, akin to "Carter bonds" in 1978.

This is the sort of petulance that tends to emerge in the late phase of slumps (1840s, early 1930s) when mass lay-offs provoke a populist backlash and hotheads run away with the agenda. Mr Nakagawa later played down the comments, calling them private thoughts, but the genie is out of the bottle.

We have come to assume that Japan under the Liberal Democratic Party (LDP) will always cleave to America, if only to safeguard US protection against Chinese naval expansion. Backed by Washington after the war as a rural counterweight to the urban left, the LDP has held an almost unbroken grip on power since 1955.

But crashes have a habit of bringing regime change. Brian Reading, a Japan veteran at Lombard Street Research, predicts a "seismic shock" over the next four months as voters rebel.

"With unemployment heading for 5 million by end-year, something must happen," he said.

The tremors from Japan follow near-weekly fulminations from Beijing, which suspects that Washington is engineering a stealth default on America's debt by the trickery of quantitative easing. This was put bluntly in February by Luo Ping, head of China's banking commission: "We hate you guys. Once you start issuing $1 trillion-$2 trillion, we know the dollar is going to depreciate." Premier Wen Jiabao picked up the theme more politely, asking whether the "massive amount of capital" lent to the US was still safe. Since then the People's Bank has floated ideas for a world currency.

China and Japan together hold 23pc of America's $6,369bn federal debt. This has caused alarm on the US talk radio circuit, but fears of imminent "dollardämmerung" and a collapse of American economic power may prove far off the mark. Who ultimately holds a gun to the head of whom?

If Asia's leaders give free rein to frustrations and crater the US bond market, they will ensure their own political destruction. Japan already risks descent into demographic death, deflation, and debt atrophy (its public debt is nearing 200pc of GDP). China's regime depends on perma-boom for post-Maoist legitimacy. Could it survive the wrath of jobless graduates and rural migrants if it provokes America into erecting trade barriers, killing the globalisation goose that lays the golden egg?

American can if necessary retreat into its vast home market and rebuild its industrial base, well-armed with 12 aircraft carrier battle groups.

The last 12 months should be lesson enough that Asia cannot yet stand on its own two feet. Its mercantilist export model remains a "high-beta" play on the West, to use trader parlance.

Japan's industrial output has fallen 34pc. China's exports are down 23pc.

Ray Maurer, from Qatar's QNB Capital, said China may be too busy closing factories it should never have built to challenge US primacy over coming years.

"China is not going to be a juggernaut until it creates a viable economy based on home consumption. It's just a tiger, living a myth," he said.

Lombard's Charles Dumas says the "super-savers" (China, Japan, Germany) have warped their own economies by relying on exports and, therefore, on perpetual debt build-up by the West.

"Their currencies are due to decline against the dollar as weak US recovery throws a few scraps from its table, over which the world's exporters will have to scrabble, cutting their prices and currencies in the process. The US is not, and is not about to become, Argentina or Zimbabwe," he said.

Let us not forget how we got here. Japan amassed a quarter trillion dollars of US bonds from January 2003 to March 2004 in a frantic effort to drive down the yen and stave off deflation. It has not yet won that battle. Producer prices fell to minus 3.8pc in April, a 22-year low.

China's holdings of US bonds are a consequence of its own policy of holding down the yuan to boost exports. Beijing may rage about America's "helicopter" stimulus, but what would have happened to the factories of Guangdong if the Fed had not taken emergency action or if the US Treasury had allowed the banks to collapse? China wants it both ways.

The world economy has long been running on fumes. The debt appetite of the Anglo-sphere and Club Med kept demand afloat, concealing excess capacity. The deformed interplay of Asia's Confucian model and Western consumption ran unchecked, until the imbalances blew up.

Yet it is easier to blame Uncle Sam, subprime, and friendless bankers. A folk tale has captured political discourse everywhere, from Beijing, to Tokyo, Moscow, and Berlin. If they are foolish enough to act on this self-serving illusion, they will pay the higher price.


The comments make more sense....
Asia does not need the US. It can simply dump it`s exports in the ocean and start its own `funny money` printing presses.

The US has nothing to offer but nostalgia.

This is too much attention, given to a mere shill for the print-a-living nations.

This so called economic journalist ''Ambrose'', has no clue what so ever. China has won the game hands down. It is very easy to explain. China accumalates USD and than buys all of the worlds tangible assets, copper, gold, oil, cobalt etc etc. He who controls the tangible assets weilds the power. It is really that simple. The next step down the line is war over these commodities. Very easy to understand plain and simple.

Ambrose an apologist for Keyensian-militarist lunacy? Didn't expect that...

Sir, you are SO wrong on this one. The US is finished as an empire, which is a GOOD thing. The Chinese have intentionally positioned themselves to pick up all the pieces from this crash. The economic fundamentals are overwhelmingly on their side (and I'm not exactly happy to be saying this). The US is beyond bankrupt and the dollar is toast. One of the last props holding the dollar up - the hope that Obama might restore some credibility to the US govt - is now gone. The world now knows that Obama is GWB2, and so the common shares of USA Inc. will soon reflect the corrupt and criminal management. The Chinese commies are evil as well, but they are NOT stupid.

So lets get this straight. Asia has all the productive capacity and savings pool, the west has a ponzi scheme economy based on speculation and vendor financing using worthless fiat money and they are the ones in trouble! In the madcap world of the Keynesians, all we need to do is print our way to prosperity. God save us from the opinions of "experts" like you Ambrose!

No Ambrose, you're in denial.

If the Chinese stop buying US government bonds, the dollar will collapse and Americans will be too broke to buy Chinese products. However, as the dollar falls China's currency will rise, and along with it will rise the purchasing power of the Chinese people. China's vast population will start to consume their own products.

The only reason foreigners continue to finance America's current account deficit by buying US bonds is because the dollar is the world's reserve currency. If they allowed the dollar to collapse their foreign currency reserves would decline in value. However, China is diversifying out of the dollar by purchasing gold, copper and other currencies. When they finish this process of diversification they will stop buying US bonds and start selling the ones they already have.

It is the producing/saving economies that have power, not the debt/consumption countries. Production is difficult, not consumption.

America can if necessary retreat into its vast home market and rebuild its industrial base, well-armed with 12 aircraft carrier battle groups.
How would America raise capital to rebuild its industrial base, it has no domestic savings. Who do you think pays for the US military? It's foreigners, by purchasing US bonds. America eventually will have to stop its phony borrow and consume economy and rebuild a real economy based on domestic savings and production. This will take a long time, and will start when Obama's ridiculous Keynesian stimulus packages based on deficit spending fail." Source

Is the US-Dollar Headed for a Mighty Crash?

An important article by Gary Dorsch published May 20, 2009, here.




More on the same: Day of Reckoning Looms for the U.S. Dollar

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Protect Your ASSets: Buy Gold or Silver NOW - If you wait you will be late.
(He who panics first, just may salvage something.