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The Multibillion-Dollar US Spy Agency You Haven’t Heard of

by James Bamford

foreignpolicy.com (March 20 2017)

On a heavily protected military base some fifteen miles south of Washington, DC, sits the massive headquarters of a spy agency few know exists. Even Barack Obama, five months into his presidency, seemed not to have recognized its name. While shaking hands at a Five Guys hamburger restaurant in Washington in May 2009, he asked a customer seated at a table about his job. “What do you [do]?” the president inquired. “I work at NGA, National Geospatial-Intelligence Agency”, the man answered. Obama appeared dumbfounded. “So, explain to me exactly what this National Geospatial …” he said, unable to finish the name. Eight years after that videotape aired, the NGA remains by far the most shadowy member of the Big Five spy agencies, which include the CIA and the National Security Agency.

Despite its lack of name recognition, the NGA’s headquarters is the third-largest building in the Washington metropolitan area, bigger than the CIA headquarters and the US Capitol.

Completed in 2011 at a cost of $1.4 billion, the main building measures four football fields long and covers as much ground as two aircraft carriers. In 2016, the agency purchased 99 acres in Saint Louis to construct additional buildings at a cost of $1.75 billion to accommodate the growing workforce, with 3,000 employees already in the city.

The NGA is to pictures what the NSA is to voices. Its principal function is to analyze the billions of images and miles of video captured by drones in the Middle East and spy satellites circling the globe. But because it has largely kept its ultra-high-resolution cameras pointed away from the United States, according to a variety of studies, the agency has never been involved in domestic spy scandals like its two far more famous siblings, the CIA and the NSA. However, there’s reason to believe that this will change under President Donald Trump.

Throughout the long election campaign and into his first months as president, Trump has pushed hard for weakening restraints on the intelligence agencies, spending more money for defense, and getting tough on law and order. Given the new president’s overwhelming focus on domestic security, it’s reasonable to expect that Trump will use every tool available to maintain it, including overhead vigilance.

In March 2016, the Pentagon released the results of an investigation initiated by the Department of Defense’s Office of Inspector General to examine military spy drones in the United States. The report, marked “For Official Use Only” and partially redacted, revealed that the Pentagon used unarmed surveillance drones over American soil on fewer than twenty occasions between 2006 and 2015. (Although the report doesn’t identify the nature of the missions, another Pentagon document lists eleven domestic drone operations that principally involved natural disasters, search and rescue, and National Guard training.)

The investigation also quoted from an Air Force law review article pointing out the growing concern that technology designed to spy on enemies abroad may soon be turned around to spy on citizens at home. “As the nation winds down these wars … assets become available to support other combatant command (“COCOM”) or US agencies, the appetite to use them in the domestic environment to collect airborne imagery continues to grow”.

Although the report stated that all missions were conducted within full compliance of the law, it pointedly noted that as of 2015 there were no standardized federal statutes that “specifically address the employment of the capability provided by a DoD UAS (unmanned aircraft system) if requested by domestic civil authorities”. Instead, there is a Pentagon policy governing reconnaissance drones that requires the Secretary of Defense to approve all such domestic operations. Under these regulations, drones “may not conduct surveillance on US persons” unless permitted by law and approved by the secretary. The policy also bans armed drones over the United States for anything other than military training and weapons testing.

In 2016, unbeknownst to many city officials, police in Baltimore began conducting persistent aerial surveillance using a system developed for military use in Iraq. Among them is ARGUS-IS, the world’s highest-resolution camera with 1.8 billion pixels. Invisible from the ground at nearly four miles in the air, it uses a technology known as “persistent stare” – the equivalent of 100 Predator drones peering down at a medium-size city at once – to track everything that moves.

With the capability to watch an area of ten or even fifteen square miles at a time, it would take just two drones hovering over Manhattan to continuously observe and follow all outdoor human activity, night and day. It can zoom in on an object as small as a stick of butter on a plate and store up to one million terabytes of data a day. That capacity would allow analysts to look back in time over days, weeks, or months. Technology is in the works to enable drones to remain aloft for years at a time.

The Department of Homeland Security has been at these crossroads before. In 2007, during the presidency of George W Bush, the department established an agency to direct domestic spy satellite stakeouts and gave it a bland name: the National Applications Office. But Congress, concerned about a “Big Brother in the Sky”, cut off funding. In 2009, it was killed by the Obama administration.

Still, unlike domestic electronic surveillance by the NSA, which has been closely scrutinized and subjected to legislation designed to protect civil liberties, domestic overhead spying has escaped the attention of both Congress and the public. The Trump administration may take advantage of that void.

Initiating a new age of “persistent surveillance”, Trump could use the spy world’s overhead assets to target Muslims or members of Black Lives Matter. The president has spoken in favor of increasing the scrutiny of mosques; aerial assessment would allow him to track worshippers. Drones could aid in the mass roundup of illegal immigrants intended for deportation, and Trump has said he may send federal forces to Chicago to quell the violence. Drones could offer the city the unblinking eye for 24/7 vigilance.

Of course, all that would require a significant expansion of the National Geospatial-Intelligence Agency to analyze the domestic imagery. Before that can happen, Trump, like Obama, has to discover there is such an agency.

A version of this article originally appeared in the March/April 2017 issue of FP magazine.

The Multibillion-Dollar U.S. Spy Agency You Haven’t Heard of

Categories: Uncategorized

The Whole Point …

… of the Internet of Things is so Big Brother can Spy on You

by George Washington

Washington’s Blog (March 15 2017)

Zero Hedge (March 16 2017)

No one wants the Internet of Things (“IoT”).

The Washington Post noted in 2014:

 

 

No one really wants a “smart” washing machine …

If you’re wondering who would want to buy an Internet-enabled washing machine, you’re not alone. Even Whirlpool’s not so sure.

“We’re a little bit of a hammer looking for a nail right now”, Chris Quatrochi, Whirlpool’s global director of user experience and connectivity, said last week at a conference hosted by tech blog Gigaom. The buyers of web-connected washers, more than a year after launch, are still “not at all widespread”, he said. “Trying to understand exactly the value proposition that you provide to the consumer”, he said, “has been a little bit of a challenge”.

It’s a big concession from one of the most notable champions of the buzzy “Internet of Things” …

As Digital Trends blogger John Sciacca put it: “Have we gotten so pathetically lame that you need to be notified by an email that your laundry is done?” {1}

 

 

Wired jokes:

 

 

Now it seems every kind of thing from dishwashers to doorknobs require an Internet connection, since after all, we all know our dishwashers have long harbored a pent up desire for scintillating conversation with our doorknobs. {2}

 

 

(Side note: Several scientists say that the Same Frequencies Used for Pain-Inflicting Crowd Control Weapons May Be the Basis of the IoT Network {3}.)

Except Big Brother

The government already is spying on us through our computers, phones, cars, buses, streetlights, at airports and on the street, via mobile scanners and drones, through our credit cards and smart meters {4}, {5}, television {6}, doll {7}, and in many other ways.

The CIA wants to spy on you through your dishwasher {8} and other “smart” appliances. Slate reported {9} in 2012:

 

 

Watch out: the CIA may soon be spying on you – through your beloved, intelligent household appliances, according to Wired {8}.

In early March, at a meeting for the CIA’s venture capital firm In-Q-Tel, CIA Director David Petraeus reportedly noted that “smart appliances” connected to the Internet could someday be used by the CIA to track individuals. If your grocery-list-generating refrigerator knows when you’re home, the CIA could, too, by using geo-location data from your wired appliances, according to SmartPlanet {10}.

“The current ‘Internet of PCs’ will move, of course, toward an ‘Internet of Things’ – of devices of all types – 50 to 100 billion of which will be connected to the Internet by 2020”, Petraeus said in his speech {11}. He continued:

“Items of interest will be located, identified, monitored, and remotely controlled through technologies such as radio-frequency identification, sensor networks, tiny embedded servers, and energy harvesters – all connected to the next-generation Internet using abundant, low cost, and high-power computing – the latter now going to cloud computing, in many areas greater and greater supercomputing, and, ultimately, heading to quantum computing”.

 

 

Last year, US Intelligence Boss James Clapper said that the government will spy on Americans through IoT:

 

 

In the future, intelligence services might use the [“IoT”] for identification, surveillance, monitoring, location tracking, and targeting for recruitment, or to gain access to networks or user credentials{12}.

 

 

Yves Smith commented at the time:

 

 

Oh, come on. The whole point of the IoT is spying. The officialdom is just trying to persuade you that it really is a big consumer benefit to be able to tell your oven to start heating up before you get home.{13}

 

 

Wired comments:

 

 

Why do you think there are so many buckets of cash pouring into the IoT hope-to-be-a-market? The Big Corporations don’t expect to make a big profit on the devices themselves, oh no. News flash: the Big Money in IoT is in Big Data. As in, Big Data about everything those sensors are learning about you and your nasty habits that you hide from your neighbors.

The value of Big Data, after all, isn’t the data themselves. “Fred’s car told Fred’s thermostat to turn on Fred’s hot tub” doesn’t interest anybody but Fred and perhaps his hot date (if he’s lucky). The value in Big Data, you see, are in the patterns. What shows you watch. What apps you use. Which ads influence your buying behavior. The more IoT you have, the more Big Data they collect, and the more Big Data they collect, the more they know about how you behave. And once they know how you behave, they know how to control how you behave.{2}

 

 

The Guardian notes:

 

 

As a category, the internet of things is useful to eavesdroppers both official and unofficial for a variety of reasons, the main one being the leakiness of the data.

There are a wide variety of devices that can be used to listen in, and some compound devices (like cars) that have enough hardware to form a very effective surveillance suite all by themselves.

There’s no getting around the fundamental creepiness of the little pinhole cameras in new smart TVs (and Xbox Kinects, and laptops, and cellphones), but the less-remarked-on aspect – the audio – may actually be more pertinent to anyone with a warrant trying to listen in. Harvard’s Berkman Center for Internet and Society observed that Samsung’s voice recognition software in its smart TVs had to routinely send various commands “home” to a server where they were processed for relevant information; their microphones are also always on, in case you’re trying to talk to them. Televisions are also much easier to turn on than they used to be: a feature creeping into higher-end TVs called “wake on LAN” allows users to power on televisions over the internet (this is already standard on many desktop PCs).

A cyberattack on toymaker VTech exposed the personal data of 6.4 million children last year; it was a sobering reminder of the vulnerability of kids on the web. But technology waits for no man. Mattel’s Hello Barbie doll works the same way the Nest and Samsung voice operators do, by passing kids’ interactions into the cloud and returning verbal responses through a speaker in the doll. HereO manufactures a watch for kids with a GPS chip in it; Fisher-Price makes a WiFi-enabled stuffed animal. Security researchers at Rapid7 looked at both and found that they were easy to compromise on company databases, and in the case of the watch, use to locate the wearer. {14}

In a separate article, The Guardian pointed out {15}:

 

 

Just a few weeks ago, a security researcher found that Google’s Nest thermostats {16} were leaking users’ zipcodes over the internet. There’s even an entire search engine {17} for the internet of things called Shodan that allows users to easily search for unsecured webcams that are broadcasting from inside people’s houses without their knowledge.

While people voluntarily use all these devices, the chances are close to zero that they fully understand that a lot of their data is being sent back to various companies to be stored on servers that can either be accessed by governments or hackers.

Author and persistent Silicon Valley critic Evgeny Morozov {18} summed up the entire problem with the internet of things and “smart” technology in a tweet last week {19}:

In case you are wondering what “smart” – as in “smart city” or “smart home” – means:

Surveillance
Marketed
As
Revolutionary
Technology

 

 

(And see Amazon Echo and the internet of things that spy on you {20}.)

In the wake of the CIA leaks showing that the agency can remotely turn on our tvs {21} and spy on us using a “fake off” mode so that it looks like the power is off, Tech Dirt wrote in an article called “CIA Leaks Unsurprisingly Show The Internet of Broken Things is a Spy’s Best Friend”:

 

 

The security and privacy standards surrounding the internet of (broken) things sit somewhere between high comedy and dogshit {22}.

 

 

As security expert Bruce Schneier points out, the entire concept of the IoT is wildly insecure and vulnerable to hacking {23}. Indeed, IoT is so insecure that it allowed a massive internet outage {24}.

The highest-level NSA whistleblower in history (William Binney) – the NSA executive who created the agency’s mass surveillance program for digital information, 36-year NSA veteran widely regarded as a “legend” within the agency, who served as the senior technical director within the agency, and managed thousands of NSA employees – reviewed an earlier version of this post, and told Washington’s Blog:

 

 

Yep, that summarizes it fairly well. It does not deal with industry or how they will use the data; but, that will probably be an extension of what they do now. This whole idea of monitoring electronic devices is objectionable.

If forced to buy that stuff, I will do my best to disconnect these monitoring devices and also look for equipment on the market that is not connected in any way.

 

 

Links:

{1} https://www.washingtonpost.com/news/the-switch/wp/2014/10/28/whirlpools-internet-of-things-problem-no-one-really-wants-a-smart-washing-machine/?utm_term=.a4c751cca45a

{2} https://www.wired.com/insights/2014/07/7-reasons-internet-things-doomed/

{3} http://www.washingtonsblog.com/2017/03/internet-things-cause-cancer.html

{4} http://www.washingtonsblog.com/2013/09/the-government-is-spying-on-us-through-our-computers-phones-cars-buses-streetlights-at-airports-and-on-the-street-via-mobile-scanners-and-drones-through-our-smart-meters-and-in-many-other-ways.html

{5} http://www.washingtonsblog.com/2014/02/smart-meters-allow-government-corporations-hackers-spy.html

{6} http://www.washingtonsblog.com/2015/02/tyler-durdens-picture-slippery-slope-yes-samsung-smart-tv-can-listen-private-conversations.html

{7} http://www.washingtonsblog.com/2015/02/big-barbie-watching-meet-wifi-connected-barbie-doll-talks-children-records.html

{8} http://www.wired.com/dangerroom/2012/03/petraeus-tv-remote/

{9} http://www.slate.com/blogs/future_tense/2012/03/19/smart_appliances_could_help_cia_spy_says_petraeus_.html

{10} http://www.smartplanet.com/blog/thinking-tech/cia-well-spy-on-you-through-your-refrigerator/10717

{11} https://www.cia.gov/news-information/speeches-testimony/2012-speeches-testimony/in-q-tel-summit-remarks.html

{12} http://www.theguardian.com/technology/2016/feb/09/internet-of-things-smart-home-devices-government-surveillance-james-clapper

{13} http://www.nakedcapitalism.com/2016/02/links-21016.html

{14} https://www.theguardian.com/world/2016/feb/10/internet-of-things-surveillance-smart-tv-cars-toys

{15} http://www.theguardian.com/commentisfree/2016/feb/09/internet-of-things-smart-devices-spying-surveillance-us-government

{16} https://motherboard.vice.com/read/nest-thermostat-leaked-home-locations-over-the-internet

{17} http://arstechnica.com/security/2016/01/how-to-search-the-internet-of-things-for-photos-of-sleeping-babies/

{18} http://www.theguardian.com/profile/evgeny-morozov

{19} https://twitter.com/evgenymorozov/status/693958196717711362

{20} http://www.popsci.com/amazon-echo-privacy

{21} http://www.washingtonsblog.com/2017/03/cia-documents-reveal-agency-spying-us-smart-tvs.html

{22} https://www.techdirt.com/articles/20170307/08085036858/cia-leaks-unsurprisingly-show-internet-broken-things-is-spys-best-friend.shtml

{23} https://www.schneier.com/essay-468.html

{24} http://www.denverpost.com/2016/10/21/internet-of-things-security-holes-partly-to-blame-for-massive-internet-outage/

http://www.washingtonsblog.com/2017/03/whole-point-internet-things-big-brother-can-spy-2.html

http://www.zerohedge.com/news/2017-03-16/whole-point-internet-things-so-big-brother-can-spy-you

Categories: Uncategorized

American Corporate Mainstream Media …

… is Merged with CIA and Has Been Since the 1950s

by Brandon Turbeville

Activist Post (March 14 2017)

Hat tip to Washington’s Blog for collating much of this information: http://www.washingtonsblog.com/2017/02/cia-one-main-peddlers-fake-news.html.

With the recent back and forth seemingly taking place between two different factions of the American Deep State and playing out before the entire country, a few alternative media outlets have begun to question whether or not certain mainstream media outlets are actually connected to the Deep State, most notably the CIA. With an unimaginable scale of disinformation being released and promoted throughout mainstream channels on a daily basis, all propagandizing the public to go along with the desired direction of the American establishment, few could assume otherwise. However, such connections between American mainstream outlets and the CIA are more than mere conjecture, they are well known and have been documented for some time.

For instance, back in the late 1940s and early 1950s, Operation Mockingbird, a plan known to many researchers today but known to virtually no one at the time it was originally being implemented, was a secret CIA effort to influence and control the American media and, thus, to influence and control the information received (as well as the opinions) of the American people. The first report of the program came in 1979 in the biography of Katharine Graham, the owner of The Washington Post, written by Deborah Davis.

Davis wrote that the program was established by Frank Wisner, the director of the Office of Policy Coordination, a covert operations unit created under the National Security Council. According to Davis, Wisner recruited Philip Graham of The Washington Post to head the project within the media industry. Davis wrote that, “By the early 1950s, Wisner ‘owned’ respected members of The New York Times, Newsweek, CBS and other communications vehicles”. Davis also writes that Allen Dulles convinced Cord Meyer, who later became Mockingbird’s “principal operative”, to join the CIA in 1951.

But while Davis’ book may have been the first mention of Operation Mockingbird by name, Carl Bernstein addressed the CIA influence over the media in 1977. According to Bernstein’s Rolling Stone article, after 1953, the media control program was overseen by Allen Dulles, the CIA Director. Bernstein says that, at that time, the CIA had influence over 25 newspapers and wire agencies. Bernstein wrote:

 

 

Among the executives who lent their cooperation to the Agency were Williarn Paley of the Columbia Broadcasting System, Henry Luce of Time Inc, Arthur Hays Sulzberger of The New York Times, Barry Bingham Sr of the LouisviIle Courier‑Journal, and James Copley of the Copley News Service. Other organizations which cooperated with the CIA include the American Broadcasting Company, the National Broadcasting Company, the Associated Press, United Press International, Reuters, Hearst Newspapers, Scripps‑Howard, Newsweek magazine, the Mutual Broadcasting System, the Miami Herald and the old Saturday Evening Post and New York Herald‑Tribune.

By far the most valuable of these associations, according to CIA officials, have been with The New York Times, CBS and Time Inc.

The CIA’s use of the American news media has been much more extensive than Agency officials have acknowledged publicly or in closed sessions with members of Congress. The general outlines of what happened are indisputable; the specifics are harder to come by. CIA sources hint that a particular journalist was trafficking all over Eastern Europe for the Agency; the journalist says no, he just had lunch with the station chief. CIA sources say flatly that a well‑known ABC correspondent worked for the Agency through 1973; they refuse to identify him. A high‑level CIA official with a prodigious memory says that The New York Times provided cover for about ten CIA operatives between 1950 and 1966; he does not know who they were, or who in the newspaper’s management made the arrangements.

The Agency’s special relationships with the so‑called “majors” in publishing and broadcasting enabled the CIA to post some of its most valuable operatives abroad without exposure for more than two decades. In most instances, Agency files show, officials at the highest levels of the CIA (usually director or deputy director) dealt personally with a single designated individual in the top management of the cooperating news organization. The aid furnished often took two forms: providing jobs and credentials “journalistic cover” in Agency parlance) for CIA operatives about to be posted in foreign capitals; and lending the Agency the undercover services of reporters already on staff, including some of the best‑known correspondents in the business.

In the field, journalists were used to help recruit and handle foreigners as agents; to acquire and evaluate information, and to plant false information with officials of foreign governments. Many signed secrecy agreements, pledging never to divulge anything about their dealings with the Agency; some signed employment contracts., some were assigned case officers and treated with. unusual deference. Others had less structured relationships with the Agency, even though they performed similar tasks: they were briefed by CIA personnel before trips abroad, debriefed afterward, and used as intermediaries with foreign agents. Appropriately, the CIA uses the term “reporting” to describe much of what cooperating journalists did for the Agency. “We would ask them, ‘Will you do us a favor?'” said a senior CIA official. “‘We understand you’re going to be in Yugoslavia. Have they paved all the streets? Where did you see planes? Were there any signs of military presence? How many Soviets did you see? If you happen to meet a Soviet, get his name and spell it right … Can you set up a meeting for is? Or relay a message?'” Many CIA officials regarded these helpful journalists as operatives; the journalists tended to see themselves as trusted friends of the Agency who performed occasional favors – usually without pay – in the national interest.

. . . . .

During the 1976 investigation of the CIA by the Senate Intelligence Committee, chaired by Senator Frank Church, the dimensions of the Agency’s involvement with the press became apparent to several members of the panel, as well as to two or three investigators on the staff. But top officials of the CIA, including former directors William Colby and George Bush, persuaded the committee to restrict its inquiry into the matter and to deliberately misrepresent the actual scope of the activities in its final report. The multi-volume report contains nine pages in which the use of journalists is discussed in deliberately vague and sometimes misleading terms. It makes no mention of the actual number of journalists who undertook covert tasks for the CIA. Nor does it adequately describe the role played by newspaper and broadcast executives in cooperating with the Agency.

The Agency’s dealings with the press began during the earliest stages of the Cold War. Allen Dulles, who became director of the CIA in 1953, sought to establish a recruiting‑and‑cover capability within America’s most prestigious journalistic institutions. By operating under the guise of accredited news correspondents, Dulles believed, CIA operatives abroad would be accorded a degree of access and freedom of movement unobtainable under almost any other type of cover.

American publishers, like so many other corporate and institutional leaders at the time, were willing to commit the resources of their companies to the struggle against “global Communism”. Accordingly, the traditional line separating the American press corps and government was often indistinguishable: rarely was a news agency used to provide cover for CIA operatives abroad without the knowledge and consent of either its principal owner, publisher or senior editor. Thus, contrary to the notion that the CIA insidiously infiltrated the journalistic community, there is ample evidence that America’s leading publishers and news executives allowed themselves and their organizations to become handmaidens to the intelligence services. “Let’s not pick on some poor reporters, for God’s sake”, William Colby exclaimed at one point to the Church committee’s investigators. “Let’s go to the managements. They were witting.” In all, about twenty‑five news organizations including those listed at the beginning of this article provided cover for the Agency.

In addition to cover capability, Dulles initiated a “debriefing” procedure under which American correspondents returning from abroad routinely emptied their notebooks and offered their impressions to Agency personnel. Such arrangements, continued by Dulles’ successors, to the present day, were made with literally dozens of news organizations. In the 1950s, it was not uncommon for returning reporters to be met at the ship by CIA officers. “There would be these guys from the CIA flashing ID cards and looking like they belonged at the Yale Club”, said Hugh Morrow, a former Saturday Evening Post correspondent who is now press secretary to former vice‑president Nelson Rockefeller. “It got to be so routine that you felt a little miffed if you weren’t asked”.

. . . . .

From the outset, the use of journalists was among the CIA’s most sensitive undertakings, with full knowledge restricted to the Director of Central Intelligence and a few of his chosen deputies. Dulles and his successors were fearful of what would happen if a journalist‑operative’s cover was blown, or if details of the Agency’s dealings with the press otherwise became public. As a result, contacts with the heads of news organizations were normally initiated by Dulles and succeeding Directors of Central Intelligence; by the deputy directors and division chiefs in charge of covert operations – Frank Wisner, Cord Meyer Jr, Richard Bissell, Desmond FitzGerald, Tracy Barnes, Thomas Karamessines and Richard Helms himself a former UPI correspondent); and, occasionally, by others in the CIA hierarchy known to have an unusually close social relationship with a particular publisher or broadcast executive.

James Angleton, who was recently removed as the Agency’s head of counterintelligence operations, ran a completely independent group of journalist‑operatives who performed sensitive and frequently dangerous assignments; little is known about this group for the simple reason that Angleton deliberately kept only the vaguest of files.

The CIA even ran a formal training program in the 1950s to teach its agents to be journalists. Intelligence officers were “taught to make noises like reporters”, explained a high CIA official, and were then placed in major news organizations with help from management. “These were the guys who went through the ranks and were told ‘You’re going to he a journalist'”, the CIA official said. Relatively few of the 400‑some relationships described in Agency files followed that pattern, however; most involved persons who were already bona fide journalists when they began undertaking tasks for the Agency.

 

 

 

Forty years later, Bernstein’s article is still a must read for understanding the CIA’s relationship to the corporate media.

Indeed, a declassified memo from 1965 confirms much of what Bernstein wrote about in 1977. This memo was addressed to the Deputy Director of the Directorate of Intelligence, Ray S Cline, and revealed the names of several high profile journalists who were “receiving intelligence” from Cline. By “intelligence”, however, one can read simply that reporters were receiving their marching orders for publication and print from the CIA. The memo contained the names Joseph C Hersch, Walter Lippmann, John Scott, Joseph Alsop, Wallace Carroll, Cy Sulzberger, Henry Gemill, Charles Bartlett, Max S Johnson, Harry Schwartz, Bill Shannon, Jess Cook, Stewart Alsop, William S White, Chalmers Roberts, Murrey Marder, Charles J V Murphy, Russell Wiggins, Alfred Friendly, Ted Szulc, and Kay Graham. The outlets listed include Christian Science Monitor, Los Angeles Times, NBC, Time, Publishers’ Newspaper Syndicate, New York Times, Wall Street Journal, US News and World Report, Saturday Evening Post, United Features Syndicate, Washington Post, Fortune, and Newsweek.

Even the US government’s official summary of the overthrow of the elected President of Iran in the 1950s admits that the CIA was planting stories in the American press. It reads, “In cooperation with the Department of State, CIA had several articles planted in major American newspapers and magazines which, when reproduced in Iran, had the desired psychological effect in Iran and contributed to the war of nerves against Mossadeq”.

In 1975, the US Senate Select Committee to Study Governmental Operations with Respect to Intelligence Activities found that the agency did indeed submit stories to the press. Chair of the Church Committee, Senator Frank Church, stated publicly, “I thought that it was a matter of real concern that planted stories intended to serve a national purpose abroad came home and were circulated here and believed here because this would mean that the CIA could manipulate the news in the United States by channeling it through some foreign country”. In other words, the type of propaganda that was supposed to be relegated to use against overseas enemies and target foreign populations was now being used at home.

During a question and answer session of the Church Committee, a CIA representative was asked a series of questions related to the possibility that the CIA was planting stories in the press. There are scarcely any lines to read between as the representative’s answers were obvious enough for what they did not contain; namely, a denial.

Question: “Do you have any people being paid by the CIA who are contributing to a major circulation – American journal?”

Answer: “We do have people who submit pieces to American journals”.

Question: “Do you have any people paid by the CIA who are working for television networks?”

Answer: “This I think gets into the kind of uh, getting into the details Mr Chairman that I’d like to get into in executive session”.

(later)

Question: “Do you have any people being paid by the CIA who are contributing to the national news services – AP and UPI?”

Answer: “Well again, I think we’re getting into the kind of detail Mr Chairman that I’d prefer to handle at executive session”.

In Deborah Davis’ book, Katharine the Great (1979), it is reported that a CIA operative once told Washington Post owner Philip Graham that “You could get a journalist cheaper than a good call girl, for a couple hundred dollars a month”.

That the program is continuing to this very day is now more of an open secret than anything deeply hidden in the way it was in the 1950s to 1970s. The extent to which news is entirely produced by the CIA and other interested government parties, however, is what is generally kept from the American public tightly under lock and key. In 1975, the idea that the corporate media would lie and that the CIA would push fake stories for propaganda purposes was shocking but, in 2017, not so much.

Indeed, many things were shocking in 1975 that scarcely appear on the radar screen today. This is how far Americans have come down a path of acceptance of the loss of rights or even the appearance of honesty. This is, in part, due to the very programs I am writing about in this article. This says nothing of the massive amount of control the CIA and other related interests have over the entertainment industry. The entertainment industry, however, is a topic far beyond the scope of this article.

The United States continues to this day to pay journalists to write propaganda pieces that suit their agenda. For instance, it was reported by The New York Times itself in 2006 that the Bush administration paid journalists for anti-Cuba stories.

Remember also, Dr Udo Ulfkotte, journalist and German political scientist who came out on public television and stated that, while working as a journalist, he was forced to print the work of intelligence agents under his own name. His refusal, according to him, would result in the loss of his job.

He said:

 

 

I’ve been a journalist for about 25 years, and I was educated to lie, to betray, and not to tell the truth to the public.

But seeing right now within the last months how the German and American media tries to bring war to the people in Europe, to bring war to Russia – this is a point of no return and I’m going to stand up and say it is not right what I have done in the past, to manipulate people, to make propaganda against Russia, and it is not right what my colleagues do and have done in the past because they are bribed to betray the people, not only in Germany, all over Europe.

 

 

In 2014, more revelations mirroring the declassified memo from 1965 came to light, with journalists regularly receiving “information” from the CIA, attending CIA events, and even handing their stories over to the CIA for input and rewrites. As Ken Silverstein wrote for The Intercept in his article, “The CIA’s Mop-Up Man: LA Times Reporter Cleared Stories With Agency Before Publication”:

 

 

A prominent national security reporter for The Los Angeles Times routinely submitted drafts and detailed summaries of his stories to CIA press handlers prior to publication, according to documents obtained by The Intercept.

Email exchanges between CIA public affairs officers and Ken Dilanian, now an Associated Press intelligence reporter who previously covered the CIA for the Times, show that Dilanian enjoyed a closely collaborative relationship with the agency, explicitly promising positive news coverage and sometimes sending the press office entire story drafts for review prior to publication. In at least one instance, the CIA’s reaction appears to have led to significant changes in the story that was eventually published in the Times.

“I’m working on a story about congressional oversight of drone strikes that can present a good opportunity for you guys”, Dilanian wrote in one email to a CIA press officer, explaining that what he intended to report would be “reassuring to the public” about CIA drone strikes. In another, after a series of back-and-forth emails about a pending story on CIA operations in Yemen, he sent a full draft of an unpublished report along with the subject line, “does this look better?” In another, he directly asks the flack: “You wouldn’t put out disinformation on this, would you?”

Dilanian’s emails were included in hundreds of pages of documents that the CIA turned over in response to two FOIA requests seeking records on the agency’s interactions with reporters. They include email exchanges with reporters for the Associated Press, Washington Post, New York Times, Wall Street Journal, and other outlets. In addition to Dilanian’s deferential relationship with the CIA’s press handlers, the documents show that the agency regularly invites journalists to its McLean, Virginia, headquarters for briefings and other events. Reporters who have addressed the CIA include The Washington Post‘s David Ignatius, the former ombudsmen for The New York Times, NPR, and Washington Post, and Fox News‘ Brett Baier, Juan Williams, and Catherine Herridge.

. . . . .

The emails also show that the CIA asked the Post‘s Ignatius to speak at a May 2012 off-the-record conference, “Political Islam’s Future: Challenges, Choices, and Uncertainties”, for US government intelligence analysts and policymakers. The invitation was extended in an email from the press office, which said that the conference organizers “would like you to draw upon the insight from your field experience, reporting, and broad network of contacts during the lead up to the Arab Spring to share how journalists sense that major political, social, or religious changes are in the making”.

Ignatius replied that he would be “pleased and honored to do this”, but unfortunately he would be traveling in Europe on the day of the conference. The CIA then proposed “a smaller round table with our … folks sometime in the future”.

“Smaller round table would be great”, Ignatius replied.

. . . . .

Fox News‘ Bret Baier gave an address about the importance of charity in 2008 (which was reported at the time), and the then-ombudsmen for NPR, The Washington Post, and The New York Times (Jeffrey Dvorkin, Michael Getler and Daniel Okrent, respectively), appeared together on a CIA panel. The event description said that journalism “shares some of the same missions that intelligence analysts have – presenting information in an unbiased fashion and challenging prevailing opinions”. The ombudsmen, the invitation said, could help the CIA “see how journalists deal with some of our common professional and ethical difficulties”. (It’s not clear from the documents when the ombudsmen event was held, but it would have been in 2009 or before.)

In 2007, Juan Williams, then at NPR in addition to his role at Fox News, gave a “standing-room-only” speech sponsored by the agency’s Office of Diversity Plans and Programs. During his speech Williams praised CIA personnel as “the best and brightest”, and said Americans admired the agency and trusted it “to guide the nation and the nation’s future”.

Also in 2007, revered journalist John Pilger gave a speech to the Socialism 2007 Conference describing how propaganda has become such an important and ubiquitous factor in our lives. He said,

We now know that the BBC and other British media were used by the British secret intelligence service MI-6. In what they called Operation Mass Appeal, MI-6 agents planted stories about Saddam’s weapons of mass destruction, such as weapons hidden in his palaces and in secret underground bunkers. All of these stories were fake.

. . . . .

One of my favorite stories about the Cold War concerns a group of Russian journalists who were touring the United States. On the final day of their visit, they were asked by the host for their impressions. “I have to tell you”, said the spokesman, “that we were astonished to find after reading all the newspapers and watching TV day after day that all the opinions on all the vital issues are the same. To get that result in our country we send journalists to the gulag. We even tear out their fingernails. Here you don’t have to do any of that. What is the secret?”

A year later in the Independent, Nick Davies wrote the following:

 

 

For the first time in human history, there is a concerted strategy to manipulate global perception. And the mass media are operating as its compliant assistants, failing both to resist it and to expose it.

The sheer ease with which this machinery has been able to do its work reflects a creeping structural weakness which now afflicts the production of our news. I’ve spent the last two years researching a book about falsehood, distortion and propaganda in the global media.

The “Zarqawi letter” which made it on to the front page of The New York Times in February 2004 was one of a sequence of highly suspect documents which were said to have been written either by or to Zarqawi and which were fed into news media.

This material is being generated, in part, by intelligence agencies who continue to work without effective oversight; and also by a new and essentially benign structure of “strategic communications” which was originally designed by doves in the Pentagon and Nato who wanted to use subtle and non-violent tactics to deal with Islamist terrorism but whose efforts are poorly regulated and badly supervised with the result that some of its practitioners are breaking loose and engaging in the black arts of propaganda.

. . . . .

The Pentagon has now designated “information operations” as its fifth “core competency” alongside land, sea, air and special forces. Since October 2006, every brigade, division and corps in the US military has had its own “psyop” element producing output for local media. This military activity is linked to the State Department’s campaign of “public diplomacy” which includes funding radio stations and news websites. In Britain, the Directorate of Targeting and Information Operations in the Ministry of Defence works with specialists from fifteen UK psyops, based at the Defence Intelligence and Security School at Chicksands in Bedfordshire.

In the case of British intelligence, you can see this combination of reckless propaganda and failure of oversight at work in the case of Operation Mass Appeal. This was exposed by the former UN arms inspector Scott Ritter, who describes in his book, Iraq Confidential (2005), how, in London in June 1998, he was introduced to two “black propaganda specialists” from MI6 who wanted him to give them material which they could spread through “editors and writers who work with us from time to time”.

 

 

In 2013, another blaringly obvious connection between The Washington Post and the CIA became apparent when it was revealed that The Washington Post‘s sole owner, Jeff Bezos, also the owner of Amazon, saw Amazon clinch a deal with the CIA regarding cloud technology infrastructure. This calls into question the independence of The Washington Post‘s coverage on the activities of the CIA and the ability of the outlet to choose to report or not report the planted stories by the agency. As RootsAction.org stated, “the Amazon-CIA deal is apt to be just the start”. The group added: “Amazon’s offer wasn’t the low bid, but it won the CIA contract anyway by offering advanced high-tech ‘cloud’ infrastructure … Bezos is personally and publicly touting Amazon Web Services – and Amazon will be seeking future CIA contracts”.

Robert McChesney is co-author of Dollarocracy: How the Money and Media Election Complex is Destroying America (2013) and author of Digital Disconnect: How Capitalism is Turning the Internet Against Democracy (2013), as well as professor of communications at the University of Illinois. When asked to comment on The Washington Post-Bezos-CIA-Amazon relationship, he responded:

 

 

When the main shareholder in one of the very largest corporations in the world benefits from a massive contract with the CIA on the one hand, and that same billionaire owns The Washington Post on the other hand, there are serious problems. The Post is unquestionably the political paper of record in the United States, and how it covers governance sets the agenda for the balance of the news media. Citizens need to know about this conflict of interest in the columns of the Post itself.

. . . . .

If some official enemy of the United States had a comparable situation – say the owner of the dominant newspaper in Caracas was getting $600 million in secretive contracts from the Maduro government – the Post itself would lead the howling chorus impaling that newspaper and that government for making a mockery of a free press. It is time for the Post to take a dose of its own medicine.

 

 

One of the most recent instances of CIA involvement in media is the ouster of former and short-lived National Security Advisor to President Donald Trump, Michael Flynn. While virtually every mainstream outlet is joining in the hysteria regarding Flynn’s resignation, a fact that is, in and of itself, reason enough to suggest a coordinated campaign, it is also important to note that the “leaks” of the conversation was originally printed in The Washington Post, an outlet that has long been known as a “leak outlet” for the CIA as demonstrated in this article. In fact, it was the acting Attorney General left over from the Obama administration, Sally Q Yates, who issued the warning to the Trump administration regarding Flynn’s statements and conversation with the Russian ambassador.

Even more so, the attack on Flynn was initiated before Trump ever took office. During the last days of the Obama Administration, CIA Director John Brennan and James Clapper, the Director of the Office of National Intelligence, two individuals who were instrumental in cocking up the ridiculous “Russian Election Hacking” scandal and its evidence-bare reports were involved in monitoring Flynn’s conversation and arguing that his appointment would be a potential risk to national security and the Trump administration. As The Washington Post itself wrote:

 

 

In the waning days of the Obama administration, James R Clapper Jr, who was the director of national intelligence, and John Brennan, the CIA director at the time, shared Yates”s concerns and concurred with her recommendation to inform the Trump White House. They feared that “Flynn had put himself in a compromising position” and thought that Pence had a right to know that he had been misled, according to one of the officials, who, like others, spoke on the condition of anonymity to discuss intelligence matters.

 

 

As former Ohio Congressman Dennis Kucinich pointed out, it is important to remember that a phone call from the incoming National Security Advisor to the President-elect of the United States was “intercepted” by the intelligence community and then given to the media for dissemination. This is an incredibly important piece of the puzzle, demonstrating that the entire affair is clearly part of an intelligence operation.

“What’s at the core of this is an effort by some in the intelligence community to upend any positive relationship between the US and Russia”, Kucinich said.

“And I tell you there’s a marching band and Chowder Society out there. There’s gold in them there hills”, he said. “There are people trying to separate the US and Russia so that this military industrial intel axis can cash in”, Kucinich added.

Kucinich also stated “There’s a game going on inside the intelligence community where there are those who want to separate the US from Russia in a way that would reignite the Cold War”.

“What’s going on in the intelligence community with this new President is unprecedented. They’re making every effort to upend him. Who knows what the truth is anymore?”

“There’s something very wrong here in the intelligence community”, he said.

When asked what Donald Trump should do, Kucinich answered, “First of all, he has to get a hold of his own intelligence apparatus. You know? This isn’t a joke. This is a serious matter. If he doesn’t get control of where the information’s coming from, he’ll never know the truth, the American people won’t know the truth and we can be set at war with almost any country. Be very careful is my warning this morning.

If the CIA/intelligence community was behind the controversy, the story had to get out somehow and that “somehow” was the notorious CIA-laden Washington Post as well as its other corresponding outlets.

While literally volumes of material could be written documenting and explaining the CIA connection and manipulation of mainstream American (and foreign) media, the fact remains that virtually everything reported in the corporate press has been, at the very least, approved and allowed to be aired by much higher powers than bumbling editorial staff. It is notable, then, to point out that one mainstream outlet – generally Reuters or Associated Press – reports a story and every other major outlet follows suit, reporting the same story with the same perspective as all the others. In a sense, it is only necessary to influence the two and one has drastic levels of influence over the entire corporate media (now made up of only about six companies). The CIA, however, has influence over many more outlets than Reuters and the Associated Press.

Unfortunately, Americans, victims of the very propaganda outlets that have fed them the line that the United States is the freest country in the world with the freest press, will continually run back to the abuser and defend their media as if it is the world’s gold standard. As Zbigniew Brzezinski once said, “Shortly, the public will be unable to reason or think for themselves. They’ll only be able to parrot the information they’ve been given on the previous night’s news.” That information is provided to them by the worker bees of an elite oligarchy who are intent on controlling the opinions, thoughts, and direction of the American people, a goal they have very nearly reached, if they haven’t already, partly due to the fact that the CIA has access to the massive amounts of digital data willingly given to corporations and funneled to the NSA for the purposes of surveillance, profiling, and manipulation. This data alone has allowed the Department of Defense to create individual Avatars that can predict the behavior of every man, woman, and child in the country.

The information contained in this article is only the tip of the iceberg regarding one aspect of Anglo-American establishment’s technique of perception management.

_____

Brandon Turbeville is an author out of Florence, South Carolina. He has a Bachelor’s Degree from Francis Marion University and is the author of eight books, Codex Alimentarius – The End of Health Freedom (2016), Seven Real Conspiracies (2011), Five Sense Solutions (2011), Dispatches from a Dissident, Volume One and Volume Two (2012), The Road to Damascus: The Anglo-American Assault on Syria (2016), The Difference It Makes: 36 Reasons Hillary Clinton Should Never Be President (2015) and Resisting the Empire: The Plan to Destroy Syria and How the Future of the World Depends on the Outcome (2017). Turbeville has published over 700 articles dealing on a wide variety of subjects including health, economics, government corruption, and civil liberties. Brandon Turbeville’s podcast Truth on The Tracks can be found every Monday night 9 pm EST at UCYTV. He is available for radio and TV interviews. Please contact activistpost (at) gmail.com.

http://www.activistpost.com/2017/03/american-corporate-msm-is-merged-with-cia-and-has-been-since-the-1950s.html

Categories: Uncategorized

Yellen’s Effed up Attack on Working People, Sad

by Mike Whitney

CounterPunch (March 17 2017)


Photo by DonkeyHotey | CC BY 2.0

Why did the Federal Reserve (“Fed”) raise its benchmark interest rate when inflation is still running below the Fed’s target, workers wages have hardly budged and the economy is not even growing at one percent?

Yellen was asked that question at a press conference on Wednesday following the release of the Federal Open Market Committee’s (FOMC’s) statement. Her answer helps to show how the Fed makes its policy decisions based on factors most people would never consider. Here’s what she said:

Janet Yellen:

 

 

Well, look, our policy is not set in stone. It is data-dependent and we’re – we’re not locked into any particular policy path … As you said, the data have not notably strengthened.

 

 

Translation: So after saying the Fed bases its decisions on the data, Yellen does a quick 180 and says the data hasn’t changed. Okay.

Janet Yellen:

 

 

There’s always noise in the data from quarter to quarter. But we haven’t changed our view of the outlook.

 

 

Translation: The Fed expects economic growth will remain in the doldrums (two percent or less).

Janet Yellen:

 

 

We haven’t boosted the outlook, projected faster growth.

 

 

Translation: The Fed is determined to maintain a slow-growth environment in order to continue its “easy money” policy which benefits Wall Street.

Janet Yellen:

 

 

We think we’re moving along the same course we’ve been on, but it’s one that involves gradual tightening in the labor market.

 

 

Translation: Ah ha. Now we’re getting somewhere. Now we can see what the rate hike is really all about. It’s all about the minuscule improvements in the labor market. Yellen thinks the improvements are a big red flag.

Janet Yellen:

 

 

I would describe some measures of wage growth as having moved up some.

 

 

Translation: Battle Stations! Battle Stations! Full Red Alert!

Janet Yellen:

 

 

Some measures haven’t moved up, but there’s is also suggestive of a strengthening labor market.

 

 

Translation: “Suggestive”? In other words, the mere hint of improving conditions in the labor market – which could result in higher wages – is enough to send Yellen into a rate-hike frenzy? Is that what she’s saying?

Janet Yellen:

 

 

And we expect policy to remain accommodative now for some time.

 

 

Translation:

So don’t worry Wall Street, we’re not cutting off the flow of cheap money, we just need to tweak rates a bit to dampen the prospect of higher wages.

Janet Yellen:

 

 

So we’re talking about a gradual path of removing policy accommodation as the economy makes progress moving toward neutral.

 

 

Translation: We’re keeping our eyes peeled for even the slightest uptick in wages, but we’ll continue to price cash below the rate of inflation so the investor class can make out like bandits.

Janet Yellen:

 

 

But we’re continuing to provide accommodation to the economy that’s allowing it to grow at an above-trend pace that’s consistent with further improvement in the labor market.

 

 

Translation: We’ll make sure the economy doesn’t grow any faster than two percent GDP for the foreseeable future so we can continue to provide cheap credit to our constituents on Wall Street who need money that is priced below the rate of inflation to push stocks and bonds higher into the stratosphere. Also, we think that rising wages are merely a fleeting blip on the radar, even so, we are prepared to raise rates until the threat has been thoroughly extinguished.

So the Fed hasn’t changed its policy or its projections. Yellen basically raised rates because she had a “gut-feeling” that the demand for labor is strengthening which means that wages could rise. (Her feelings on this matter are not supported by the data, but whatever.) As the primary steward of the system, it’s Yellen’s job to make sure that doesn’t happen. Any sign that of improvement in labor markets (like higher wages or, god forbid, rising standards of living) must be squelched before they ever get started. At the same time, the Fed has to balance its anti-worker duties with its stealth mandate to shower the investor class with below market-priced credit to help them game the system and rake off hefty profits. It’s a tough job, but the Fed has proved that it’s more than ready to meet the challenge.

The idea that the Fed is an impartial referee that serves the public by setting interest rates and regulating the financial system, is the nuttiest of all the conspiracy theories. The Fed is not only a creature of the banks, it is also the most destructive institution in the country today. Just look at the growing social unrest, the political instability and the sudden surge in right-wing movements. Does anyone seriously believe these phenomena just popped out of nowhere? These are all the result of the gaping inequality that has emerged under the Fed’s malign stewardship. There’s nothing accidental in the way that wealth has been transferred from one class to another. It’s all part of a plan, a plan to enrich the few while everyone sees their incomes shrivel, their wages stagnate, the health care costs soar, their education expenses explode, their personal debts balloon, and their standards of living steadily decline.

Check out this chart from Bloomberg that shows with stunning clarity the real impact the Fed’s misguided policies. Rather than try to persuade readers that the Fed is a thoroughly corrupt and heinous institution that is a threat to every man, woman and child in the USA, I ask readers to study the chart and draw your own conclusions. The question that arises is this: Did the Fed choose the policy that would best serve the interests of the American people (by restoring economic growth and increasing employment) or did they choose a policy that they knew would maximize the profits for the investor class at the expense of everyone else?

You decide.

unnamed
(Here’s One Chart That Captures the Debate Over Quantitative Easing, Bloomberg {1})

One more thing: How much of our fractious and increasingly-polarized political culture is the result of economic and monetary policies that have intensified feelings of hopelessness among the public? Would the American people have voted for a rightwing demagogue unless they were so desperate about the slide in their standards of living that they felt compelled to look for remedies outside the political mainstream?

Isn’t it true that Donald Trump wouldn’t be president today if it wasn’t for the Fed?
Think about it.

Link:

{1} https://www.bloomberg.com/news/articles/2017-03-15/one-chart-captures-debate-over-qe-from-markets-to-politics

http://www.counterpunch.org/2017/03/17/yellens-effed-up-attack-on-working-people-sad/

Categories: Uncategorized

It’s Time to Get Painfully Honest

Banks are Evil

by Adam Taggart via PeakProsperity.com

Zero Hedge (March 18 2017)

I don’t talk to my classmates from business school anymore, many of whom went to work in the financial industry.

Why?

Because, through the lens we use here at PeakProsperity.com to look at the world, I’ve increasingly come to see the financial industry – with the big banks at its core – as the root cause of injustice in today’s society. I can no longer separate any personal affections I might have for my fellow alumni from the evil that their companies perpetrate.

And I’m choosing that word deliberately: Evil.

In my opinion, it’s long past time we be brutally honest about the banks. Their influence and reach has metastasized to the point where we now live under a captive system. From our retirement accounts, to our homes, to the laws we live under – the banks control it all. And they run the system for their benefit, not ours.

While the banks spent much of the past century consolidating their power, the repeal of the Glass-Steagall Act {1} in 1999 emboldened them to accelerate their efforts. Since then, the key trends in the financial industry have been to dismantle regulation and defang those responsible for enforcing it, to manipulate market prices (an ambition tremendously helped by the rise of high-frequency trading algorithms), and to push downside risk onto “muppets” and taxpayers.

Oh, and of course, this hasn’t hurt either: having the ability to print up trillions in thin-air money and then get first-at-the-trough access to it. Don’t forget, the Federal Reserve (“Fed”) is made up of and run by {2} – drum roll, please – the banks.

How much “thin air” money are we talking about? The Fed and the rest of the world’s central banking cartel has printed over $12 Trillion {3} since the Great Recession. Between the ECB and the BoJ, nearly $200 Billion of additional liquidity has been – and continues to be – injected into world markets each month(!) since the beginning of 2016:

With their first-in-line access to this money tsunami, as well as their stranglehold on the financial system that it all runs through, the banks are like a parasite feasting from a gusher on the mother-lode artery.

It should come as little surprise that, with all this advantage they’ve amassed, the banks have enriched themselves and their cronies spectacularly. They have made themselves too big to fail, and too big to jail. Remember that their reckless greed caused the 2008 financial crisis, and yet, in 2009, not only did bankers avoid criminal prosecutions {4}, not only did the banks receive hundreds of billions in government bailouts {5}, but they paid themselves record bonuses {6}?

And the bonanza continues unabated today. By being able to borrow capital for essentially free today from the Fed, the banks simply lever that money up and buy Treasurys. Voila! Risk-free profits. That giveaway has been going on for years.

Couple that with the banks’ ability to push market prices around using their wide arsenal of unfair tactics – frontrunning, HFT spoofing and quote stuffing, stop-running, insider knowledge, collusion, et cetera – the list is long. James Howard Kunstler is dead on: we don’t have a free market anymore. Instead, we have rackets {7}, run by racketeers. The rest of us are simply suckers to be fleeced.

Nobel Prize-winning economist Angus Deaton recently agreed:

 

 

Income inequality is not killing capitalism in the United States, but rent-seekers like the banking and the health-care sectors just might, said Nobel-winning economist Angus Deaton on Monday.

If an entrepreneur invents something on the order of another Facebook, Deaton said he has no problem with that person becoming wealthy.

“What is not okay is for rent-seekers to get rich”, Deaton said in a luncheon speech to the National Association for Business Economics.

Rent seekers lobby and persuade governments to give them special favors.

Bankers during the financial crisis, and much of the health-care system, are two prime examples, Deaton said.

Rent-seeking not only does not generate new product, it actually slows down economic growth, Deaton said.

“All that talent is devoted to stealing things, instead of making things”, he said. {8}

As further proof, let’s look at this data recently obtained by Zero Hedge {9}. In the past four years, JP Morgan’s in-house trading group has had exactly two days of losses:

That’s not trading. Trading involves uncertainty and risk. This situation has none. It’s an extraction process – siphoning value from the market day after day with ironclad dependability.

And it’s not just a few dollars here and there. In 2016, JP Morgan’s daily average trading revenues were $80 million. Per day! That’s nearly $20 billion for the year.

So if not “trading”, what should we call it when a bank can extract tens of billions of dollars a year from the markets, with no downside risk? “Sanctioned theft” sounds about right.

Because for every trade there is a buyer and a seller. If JP Morgan is the winner every day, who is losing? Turns out, it’s the big pools of “dumb money” that don’t have the cheat codes for the system the way the banks do. These are the pension funds, the index funds, the retirement accounts – the aggregated money of all the “little people” out there. Little people who don’t have visibility into how they’re being constantly fleeced; nor do they have agency to do anything about it even if they did.

So yeah, “theft” feels like a pretty accurate term.

And it’s reached the point where the banks don’t even care about hiding it anymore. If you had a nice inside racket going on, wouldn’t you at least pretend to hide your advantage, to avoid drawing attention? Not the banks. They’re either too proud or too obtuse to conceal it. Look at our string of perfect trading days! Look at our record bonuses!

These boasts fall on the ears of everyday American’s as the modern version of Let them eat cake!

And just like the out-of-touch French monarchs, the banks have positioned themselves as the enemy of the public. For as I claimed at the beginning of this article, a tremendous amount of the injustice in this country can be laid at the feet of the banks directly, or indirectly via the Federal Reserve.

Are you a senior who can’t afford to retire because you can’t live off your fixed-income savings? Thank the Fed’s zero percent interest rates for that.

Are you a millennial who can’t afford to buy a home? Again, thank the Fed’s policy of suppressing interest rates and thereby blowing another housing bubble.

Are you struggling to get out of poverty? Are you finding it hard to remain in the middle class? Whatever your income, are you having to work harder and harder to just stay in the same place? See how the Fed’s money printing, and the banks’ first-position access to it, has created the most concentrated imbalance of wealth in our country’s history {10}:

Are you frustrated with how our lawmakers seem to serve corporations instead of the people? Listen to this mind-blowing podcast of how gobs of lobbyist money {11}, much of it provided by Wall Street, dictates how our politicians legislate:

This American Life

Click {12} to launch podcast

Whether it’s social equity, the security of your job or retirement, your day-to-day existence, or the fairness of the laws we live under – our fate is currently in the hands of the banks. And, of course, should their behavior trigger another meltdown of the global economy – something we warn about often here at PeakProsperity.com – we’ll have them to thank for that, too.

Yes, the banks are going to keep writing the rules in their favor; and yes, there’s little agency any of us has individually to do much about it. But as a society, we need to start addressing the dire situation we’re in honestly and openly. By whatever path, we have granted the banks far too much control over our lives, and they are taking gross advantage of that. Exactly like a parasite, the banking system is siphoning off our wealth and limiting our freedoms and future prospects – all for the benefit of an elite few.

That’s wrong. It’s immoral. And it’s Evil.

It’s far beyond time to call a spade and spade. The path to change always begins with an accurate assessment of the problem. We need to start using accurate language – like “evil” – when discussing the harm we’re being subjected to. We need to make it clear to our elected officials and to our communities that we understand what the banks are doing and that we find it unacceptable.

We need to make the criticism specific and personal. To JP Morgan CEO Jamie Dimon. To Fed Chair Janet Yellen. We need to turn up the heat on the perpetrating decision-makers, so that the borg-like structure of the banking system no longer serves as a deflective shield to scrutiny and criticism. These people need to feel the disapproving stares when speaking to the public. They need to hear the disdainful boos, and see their faces on the protest signs and nightly media reports.

And if you yourself work in the financial system, I’ll be blunt. You’re part of the problem. Just like my former classmates, I’m sure you’re a very nice person in many ways – but you’re complicit in the banks’ rapaciousness.

I know it’s not pleasant to hear, or admit. I worked for an investment bank for a few years early on my career. I was part of the problem, too.

But we have a choice, both as individuals and as a society, to align our actions with our values. It’s not always easy. And likely not as profitable if you indeed end up leaving the financial industry (as I can tell you from personal experience). But it’s the only way we’ll ultimately gain back control of our destiny.

Look, the banks’ dominion is going to end one day. Either due to collapsing under the weight of the stupendous amount of debt {13} they’ve helped laden our economy with, or due to an uprising from the bottom 99% once it has become fully destitute. Neither path is appealing.

So our best choice here as individuals is to position ourselves where we can be least subjected to the game the banks want to force us to play.

The three-part series we’ve just concluded: The Mother of All Financial Bubbles {13}, The Coming Great Wealth Transfer {14}, and When This All Blows Up {15} offers our best guidance for preserving wealth from the predation of the bankers. If you haven’t read them yet, make that your weekend reading assignment.

Finally, as a society, we need to wake up and make some hard, courageous choices. Obviously, the banks will not relinquish their control willingly. But if we start speaking truthfully and openly about the evil we’re dealing with, we’ll start fearing it less. It’s time for us all to speak up.

Links:

{1} https://dealbook.nytimes.com/2009/11/12/10-years-later-looking-at-repeal-of-glass-steagall/

{2} https://en.wikipedia.org/wiki/Federal_Reserve_System#/media/File:FederalReserve_System.png

{3} http://www.yardeni.com/pub/peacockfedecbassets.pdf

{4} https://www.theatlantic.com/magazine/archive/2015/09/how-wall-streets-bankers-stayed-out-of-jail/399368/

{5} https://en.wikipedia.org/wiki/Emergency_Economic_Stabilization_Act_of_2008

{6} http://www.nytimes.com/2009/07/31/business/31pay.html

{7} https://www.peakprosperity.com/podcast/100707/james-howard-kunstler-racketeering-ruining-us

{8} http://www.marketwatch.com/story/nobel-economist-takes-aim-at-rent-seeking-banking-and-healthcare-industries-2017-03-06?siteid=rss

{9} http://www.zerohedge.com/news/2017-03-01/jpmorgans-trading-desk-lost-money-just-two-days-past-4-years

{10} https://youtu.be/QPKKQnijnsM

{11} https://www.thisamericanlife.org/radio-archives/episode/461/transcript

{12} https://www.thisamericanlife.org/radio-archives/episode/461/take-the-money-and-run-for-office

{13} https://www.peakprosperity.com/blog/107199/mother-all-financial-bubbles

{14} https://www.peakprosperity.com/blog/107462/coming-great-wealth-transfer

{15} https://www.peakprosperity.com/blog/107796/when-all-blows

https://www.peakprosperity.com/blog/107415/banks-evil

http://www.zerohedge.com/news/2017-03-18/its-time-get-painfully-honest-banks-are-evil

Categories: Uncategorized

America’s Democracy has become Illiberal

by Fareed Zakaria, Opinion Writer

The Washington Post (December 29 2016)

Two decades ago, I wrote an essay in Foreign Affairs that described an unusual and worrying trend: the rise of illiberal democracy. Around the world, dictators were being deposed and elections were proliferating. But in many of the places where ballots were being counted, the rule of law, respect for minorities, freedom of the press and other such traditions were being ignored or abused. Today, I worry that we might be watching the rise of illiberal democracy in the United States – something that should concern anyone, Republican or Democrat, Donald Trump supporter or critic.

What we think of as democracy in the modern world is really the fusing of two different traditions. One is, of course, public participation in selecting leaders. But there is a much older tradition in Western politics that, since the Magna Carta in 1215, has centered on the rights of individuals – against arbitrary arrest, religious conversion, censorship of thought. These individual freedoms (of speech, belief, property ownership and dissent) were eventually protected, not just from the abuse of a tyrant but also from democratic majorities. The Bill of Rights, after all, is a list of things that majorities cannot do.

In the West, these two traditions – liberty and law on the one hand, and popular participation on the other – became intertwined, creating what we call liberal democracy. It was noticeable when I wrote the essay, and even clearer now, that in a number of countries – including Hungary, Russia, Turkey, Iraq and the Philippines – the two strands have come apart. Democracy persists (in many cases), but liberty is under siege. In these countries, the rich and varied inner stuffing of liberal democracy is vanishing, leaving just the outer, democratic shell.

What stunned me as this process unfolded was that laws and rules did little to stop this descent. Many countries had adopted fine constitutions, put in place elaborate checks and balances, and followed best practices from the advanced world. But in the end, liberal democracy was eroded anyway. It turns out that what sustains democracy is not simply legal safeguards and rules, but norms and practices – democratic behavior. This culture of liberal democracy is waning in the United States today.

The Founding Fathers were skeptical of democracy and conceived of America as a republic to mitigate some of the dangers of illiberal democracy. The Bill of Rights, the Supreme Court, state governments and the Senate are all bulwarks against majoritarianism. But the United States also developed a democratic culture, formed in large part by a series of informal buffers that worked in similar ways. Alexis de Tocqueville called them “associations” – meaning nongovernmental groups such as choir societies, rotary clubs and professional groups – and argued that they acted to “weaken the moral empire of the majority”. Alexander Hamilton felt that ministers, lawyers and other professionals would be the “impartial arbiters” of American democracy, ensuring that rather than narrow, special interests, the society and its government would focus on the national interest.

The two prevailing dynamics in US society over the past few decades have been toward greater democratic openness and market efficiency. Congressional decision-making has gone from a closed, hierarchical system to an open and freewheeling one. Political parties have lost their internal strength and are now merely vessels for whoever wins the primaries. Guilds and other professional associations have lost nearly all moral authority and have become highly competitive and insecure organizations, whose members do not – and probably cannot – afford to act in ways that serve the public interest. In the media – the only industry protected explicitly in the Constitution – a tradition of public interest ownership and management aspired to educate the public. Today’s media have drifted from this tradition.

I recognize that this is a romantic view of the role of these elites and hierarchical structures. Parts of the media were partisan and scandal-hungry from the start. Lawyers often acted in their own narrow interests; accountants regularly conspired in frauds. And those smoke-filled rooms with party bosses often made terrible decisions.

But we are now getting to see what American democracy looks like without any real buffers in the way of sheer populism and demagoguery. The parties have collapsed, Congress has caved, professional groups are largely toothless, the media have been rendered irrelevant. When I wrote a book about “illiberal democracy” in 2003, I noted that in polls, Americans showed greatest respect for the three most undemocratic institutions in the country: the Supreme Court, the Federal Reserve and the armed forces. Today, the first two have lost much of their luster, and only the latter remains broadly admired.

What we are left with today is an open, meritocratic, competitive society in which everyone is an entrepreneur, from a congressman to an accountant, always hustling for personal advantage. But who and what remain to nourish and preserve the common good, civic life and liberal democracy?

_____

Read more from Faree Fareed Zakaria’s archive https://www.washingtonpost.com/people/fareed-zakaria/?tid=a_inl&utm_term=.280f778bccbc, follow him on Twitter or subscribe to his updates on Facebook.

https://www.washingtonpost.com/opinions/america-is-becoming-a-land-of-less-liberty/2016/12/29/2a91744c-ce09-11e6-a747-d03044780a02_story.html

Categories: Uncategorized

Our Hopelessly Dysfunctional Democracy

When the system is rigged, “democracy” is just another public-relations screen to mask the unsavory reality of Oligarchy.

by Charles Hugh-Smith

Of Two Minds (March 21 2017)

Zero Hedge (March 22 2017)

Democracy in America has become a hollow shell. The conventional markers of democracy – elections and elected representatives – exist, but they are mere facades; the mechanisms of setting the course of the nation are corrupt, and the power lies outside the public’s reach.

History has shown that democratic elections don’t guarantee an uncorrupt, functional government. Rather, democracy has become the public-relations stamp of approval for corrupt governance that runs roughshod over individual liberty while centralizing the power to enforce consent, silence critics and maintain the status quo.

Consider Smith’s Neofeudalism Principle #1: If the citizenry cannot replace a dysfunctional government and/or limit the power of the financial Aristocracy at the ballot box, the nation is a democracy in name only.

In other words, if the citizenry changes the elected representation but the financial Aristocracy and the Deep State remain in charge, then the democracy is nothing but a public relations facade for an oppressive oligarchy.

If the erosion of civil liberties and rising inequality characterize the state of the nation, democracy is both dysfunctional and illiberal. A state that strips away the civil liberties of its citizens via civil forfeiture, a war-on-drugs Gulag and unlimited surveillance may be a democracy in name, but it is at heart an oppressive oligarchy.

If the super-wealthy continue to become ever wealthier while the bottom 95% of the citizenry struggle in various stages of debt-serfdom, the state may be a democracy in name, but it is at heart an oppressive oligarchy.

Author/commentator Fareed Zakaria recently addressed the illiberal aspects of America’s faded democracy in an article America’s democracy has become illiberal {1}.

Zakar’s prettified critique avoided the real worm at the heart of our democracy: the state exists to enforce cartels. Some might be private, some might be state-run, and others might be hybrids, such as our failed Sickcare system and our military industrial complex.

The ultimate role of democracy isn’t to “give the people a voice”; the only meaningful role of democracy is to protect the liberties of individuals from state encroachment, break up cartels and monopolies and limit the corruption of private/public money.

America’s democracy has failed on all counts. Civil liberties in a nation of ubiquitous central-state surveillance, a quasi-political Gulag (that nickel bag will earn you a tenner in America’s drug-war Gulag) and civil forfeiture (we suspect you’re up to no good, so we have the right to steal your car and cash) are eroding fast.

In America, the central government’s primary job is enforcing and funding cartels. As many of us have pointed out for years, a mere $10 million in lobbying, revolving-door graft (getting paid $250,000 for a speech or for a couple of board meetings) and bribes (cough-cough, I mean campaign contributions) can secure $100 million in profits – either by erecting regulatory/legal barriers or by direct federal funding of the cartel’s racket (healthcare, defense, “National Security”, et cetera).

I explain why this is so in my books Resistance, Revolution, Liberation {2}, Inequality and the Collapse of Privilege {3} and Why Our Status Quo Failed and Is Beyond Reform {4}.

The fact that the corruption is veiled does not mean it isn’t corruption. In the sort of nations Americans mock as fake democracies, the wealthy protect their wealth and incomes with bags of cash delivered at night to politicians.

Nothing so crass or obvious here, of course. Here, the government of Algiers gives $25 million to the Clinton Foundation for “favors”, the Russian government gives hundreds of thousands to John Podesta’s firm for “advice” (heh), the Koch Brothers fund an array of front-organizations that work on behalf of their agenda, K Street lobbying firms rake in tens of millions of dollars every year, and the first thing tech companies do when they realize some interest group might crimp their profits courtesy of lobbying the central state’s politicos is set up their own lavish lobbying and “contribution” schemes.

In theory, democracy enables advocacy by a variety of groups in order to reach a consensual solution to problems shared by everyone. In practice, the advocacy is limited to a select group of insiders, donors and the various fronts of the wealthy: foundations, think-tanks, lobbyists, et cetera.

Does anyone think America’s democracy is still capable of solving the truly major long-term problems threatening the nation? Based on what evidence? What we see is a corrupt machine of governance that kicks every can down the road rather than suffer the blowback of honestly facing problems that will require deep sacrifices and changes in the status quo.

We see a dysfunctional machine of governance that changes the name of legislation and proposes policy tweaks, while leaving the rapacious cartels untouched. (See the current sickcare “debate” for examples.)

We see an Imperial Project setting the state’s agenda to suit its own desires, and a corporate media that is quivering with rage now that the public no longer believes its tainted swill of “news” and “reporting”.

The divide between the haves and the have-nots is not limited to money – it’s also widening between the few with political power and the teeming serfs with effectively zero political power. When the system is rigged, “democracy” is just another public-relations screen to mask the unsavory reality of oligarchy.

Links:

{1} https://www.washingtonpost.com/opinions/america-is-becoming-a-land-of-less-liberty/2016/12/29/2a91744c-ce09-11e6-a747-d03044780a02_story.html

{2} http://www.amazon.com/gp/product/1468065084/ref=as_li_qf_sp_asin_tl?ie=UTF8&tag=charleshughsm-20&linkCode=as2&camp=1789&creative=9325&creativeASIN=1468065084

{3} https://www.amazon.com/gp/product/B01MSP2SXM/ref=as_li_tl?ie=UTF8&camp=1789&creative=9325&creativeASIN=B01MSP2SXM&linkCode=as2&tag=charleshughsm-20&linkId=e45dbb20ba66e69c33a3a26772391278

{4} http://www.amazon.com/gp/product/B01ELXQZGE/ref=as_li_tl?ie=UTF8&camp=1789&creative=9325&creativeASIN=B01ELXQZGE&linkCode=as2&tag=charleshughsm-20&linkId=33DAOPEVGBNGBS37

http://charleshughsmith.blogspot.com/2017/03/our-hopelessly-dysfunctional-democracy.html

http://www.zerohedge.com/news/2017-03-22/our-hopelessly-dysfunctional-democracy

Categories: Uncategorized