Friday, January 2, 2015

The American People Are Utterly Clueless About What Is Going To Happen As We Enter 2015

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The American people are feeling really good right about now.  For example, Gallup’s economic confidence index has hit the highest level that we have seen since the last recession.  In addition,nearly half of all Americans believe that 2015 will be a better year than 2014 was, and only about 10 percent believe that it will be a worse year.  And a lot of people are generally feeling quite good about the people that have been leading our nation.  According to Gallup, once again this year Hillary Clinton is the most admired woman in America and Barack Obama is the most admired man in America.  I don’t know what that says about our nation, but it can’t be good.  Unfortunately, when things seem to be going well common sense tends to go out the window.  A couple days ago, the Guardian ran an article entitled “Goodbye to one of the best years in history“, and a whole lot of people out there are feeling really optimistic these days.  But should they be?
Sadly, what we are experiencing right now is so similar to what we witnessed in 2007 and early 2008.  The stock market had been on a great run, people were flipping houses like crazy and most people were convinced that the party would never end.
But then it did end – very painfully.
The signs of trouble were there, but most people chose to ignore them.
Sadly, the exact same thing is happening again.
On Monday, the price of oil hit a brand new five year low.  As I write this, U.S. oil is sitting at a price of $53.76 a barrel, which is nearly a 50 percent decline from the peak earlier this year.
There is only one other time in history when the price of oil has declined by more than 50 dollars a barrel in such a short time frame.  That was back in the middle of 2008, shortly before the worst stock market crash since the Great Depression.
Unless the price of oil starts really bouncing back, the U.S. economy is going to be hit really hard.
Since 2009, oil industry employment has risen by 50 percent.  And jobs in the oil industry pay quite well.  One figure that I saw put the average weekly wage at about 1700 dollars.
But now we aren’t going to be gaining those types of jobs.  Instead, we are going to rapidly start losing them.
Already, the oil rig count has dropped for three weeks in a row and is now at an 8 month low.  And as the oil industry suffers, all of the industries that it supports are also going to start feeling the pain.  In fact, Business Insider is reporting that Texas business executives are “freaked out” about what is happening…
Business executives in Texas are worried about the drop in oil prices.
On Monday, the Dallas Fed’s latest manufacturing survey showed that activity in Texas was slowing down.
The latest composite index came in at 4.1, widely missing expectations and down big from November’s reading. Expectations were for the index to come in at 9, down from 10.5 last month.
So while most Americans are feeling really good about the coming year, many of those with an inside view are becoming quite alarmed.  One Texas business executive went so far as to say that the stunning decline in oil prices was going to make things ugly … quickly.
Meanwhile, the 9 trillion dollar U.S. dollar carry trade is starting to unwind.
The following is an excerpt from a recent Zero Hedge article
Oil’s collapse is predicated by one major event: the explosion of the US Dollar carry trade. Worldwide, there is over $9 TRILLION in borrowed US Dollars that has been ploughed into risk assets.
Energy projects, particularly Oil Shale in the US, are one of the prime spots for this. But it is not the only one. Economies that are closely aligned with commodities (all of which are priced in US Dollars) are getting demolished too.
Just about everything will be hit as well. Most of the “recovery” of the last five years has been fueled by cheap borrowed Dollars. Now that the US Dollar has broken out of a multi-year range, you’re going to see more and more “risk assets” (read: projects or investments fueled by borrowed Dollars) blow up. Oil is just the beginning, not a  standalone story.
If things really pick up steam, there’s over $9 TRILLION worth of potential explosions waiting in the wings. Imagine if the entire economies of both Germany and Japan exploded and you’ve got a decent idea of the size of the potential impact on the financial system.
And that’s assuming NO increased leverage from derivative usage.
And yes, as that last excerpt mentioned, derivatives could soon become a massive problem.  The big banks are holding trillions in commodity derivatives that could blow up if the price of oil does not rebound.  Overall, there are five U.S. banks that each have more than 40 trillion dollars of exposure to derivatives of all types, and the total global derivatives bubble is at least 700 trillion dollars at this point.
At the same time, many are becoming concerned that the unprecedented bond bubble that we are witnessing could soon implode and trillions of dollars of “wealth” could disappear into thin air.
In fact, Bloomberg says that we should “get ready for a disastrous year” for bonds…
Get ready for a disastrous year for U.S. government bonds. That’s the message forecasters on Wall Street are sending.
With Federal Reserve Chair Janet Yellen poised to raise interest rates in 2015 for the first time in almost a decade, prognosticators are convinced Treasury yields have nowhere to go except up. Their calls for higher yields next year are the most aggressive since 2009, when U.S. debt securities suffered record losses, according to data compiled by Bloomberg.
That certainly does not sound very optimistic, does it?
Anyone with even a minimal amount of intelligence should be able to see the massive financial bubbles that the central banks of the world have created, and anyone with even a minimal amount of intelligence should be able to see that we are heading for a massive financial implosion which will be extraordinarily painful.
Unfortunately, as I wrote about yesterday, the American people have become “zombiefied“.  Instead of thinking for themselves, they let “the matrix” do their thinking for them.  And right now “the matrix” is telling them that everything is going to be just fine in 2015.

Washington Has Shaped 2015 To Be A Year Of Conflict

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Washington has shaped 2015 to be a year of conflict. The conflict could be intense.

Washington is the cause of the conflict, which has been brewing for some time. Russia was too weak to do anything about it when the Clinton regime pushed NATO to Russia’s borders and illegally attacked Yugoslavia, breaking the country into small easily controlled pieces. Russia was also too weak to do anything about it when the George W. Bush regime withdrew from the ABM treaty and undertook to locate anti-ballistic missile bases on Russia’s borders. Washington lied to Moscow that the purpose of the ABM bases is to protect Europe from non-existent Iranian nuclear ICBMs. However, Moscow understood that the purpose of the ABM bases is to degrade Russia’s nuclear deterrent, thereby enhancing Washington’s ability to coerce Russia into agreements that compromise Russian sovereignty.

By summer 2008 Russian power had returned. On Washington’s orders, the US and Israeli trained and equipped Georgian army attacked the breakaway republic of South Ossetia during the early hours of August 8, killing Russian peacekeepers and civilian population. Units of the Russian military instantly responded and within a few hours the American trained and equipped Georgian army was routed and defeated. Georgia was in Russia’s hands again, where the province had resided during the 19th and 20th centuries.

Putin should have hung Mikheil Saakashvili, the American puppet installed as president of Georgia by the Washington-instigated “Rose Revolution”, and reincorporated Georgia into the Russian Federation. Instead, in a strategic error, Russia withdrew its forces, leaving Washington’s puppet regime in place to cause future trouble for Russia. Washington is pushing hard to incorporate Georgia into NATO, thus adding more US military bases on Russia’s border. However, at the time, Moscow thought Europe to be more independent of Washington than it is and relied on good relations with Europe to keep American bases out of Georgia.
Today the Russian government no longer has any illusion that Europe is capable of an independent foreign policy. Russian President Vladimir Putin has stated publicly that Russia has learned that diplomacy with Europe is pointless, because European politicians represent Washington’s interest, not Europe’s. Foreign Minister Sergei Lavrov recently acknowledged that Europe’s Captive Nation status has made it clear to Russia that Russian goodwill gestures are unable to produce diplomatic results.

With Moscow’s delusion shattered that diplomacy with the West can produce peaceful solutions, reality has set in, reinforced by the demonization of Vladimir Putin by Washington and its vassal states. Hillary Clinton called Putin the new Hitler. While Washington incorporates former constituent parts of the Russian and Soviet empires into its own empire and bombs seven countries, Washington claims that Putin is militarily aggressive and intends to reconstitute the Soviet empire. Washington arms the neo-nazi regime Obama established in Ukraine, while erroneously claiming that Putin has invaded and annexed Ukrainian provinces. All of these blatant lies are echoed repeatedly by the Western presstitutes. Not even Hitler had such a compliant media as Washington has.

Every diplomatic effort by Russia has been blocked by Washington and has come to naught. So now Russia has been forced by reality to update its military doctrine. The new doctrine approved on December 26 states that the US and NATO comprise a major military threat to the existence of Russia as a sovereign independent country.

The Russian document cites Washington’s war doctrine of pre-emptive nuclear attack, deployment of anti-ballistic missiles, buildup of NATO forces, and intent to deploy weapons in space as clear indications that Washington is preparing to attack Russia.

Washington is also conducting economic and political warfare against Russia, attempting to destabilize the economy with economic sanctions and attacks on the ruble. The Russian document acknowledges that Russia faces Western threats of regime change achieved through “actions aimed at violent change of the Russian constitutional order, destabilization of the political and social environment, and disorganization of the functioning of governmental bodies, crucial civilian and military facilities and informational infrastructure of Russia.” Foreign financed NGOs and foreign owned Russian media are tools in Washington’s hands for destabilizing Russia.

Washington’s reckless aggressive policy against Russia has resurrected the nuclear arms race. Russia is developing two new ICBM systems and in 2016 will deploy a weapons system designed to negate the US anti-ballistic missile system. In short, the evil warmongers that rule in Washington have set the world on the path to nuclear armageddon.

The Russian and Chinese governments both understand that their existence is threatened by Washington’s hegemonic ambitions. Larchmonter reports that in order to defeat Washington’s plans to marginalize both countries, the Russian and Chinese governments have decided to unify their economies into one and to conjoin their military commands. Henceforth, Russia and China move together on the economic and military fronts.

The unity of the Bear and the Dragon reduces the crazed neoconservatives’ dream of “an American century” to dangerous nonsense. As Larchmonter puts it, “The US and NATO would need Michael the Archangel to defeat China-Russia, and from all signs Michael the Archangel is aligned with the Bear and its Orthodox culture. There is no weapon, no strategy, no tactic conceivable in the near future to damage either of these rising economies now that they are ‘base pairs.’”

Larchmonter sees hope in the new geopolitics created by the conjoining of Russia and China. I don’t dispute this, but if the arrogant neoconservatives realize that their hegemonic policy has created a foe over which Washington cannot prevail, they will push for a pre-emptive nuclear strike before the Russian-Chinese unified command is fully operational. To forestall a sneak attack, Russia and China should operate on full nuclear alert.

The US economy–indeed the entire Western orientated economy from Japan to Europe–is a house of cards. Since the economic downturn began seven years ago, the entirety of Western economic policy has been diverted to the support of a few over-sized banks, sovereign debt, and the US dollar. Consequently, the economies themselves and the ability of populations to cope have deteriorated.
The financial markets are based on manipulation, not on fundamentals. The manipulation is untenable. With debt exploding, negative real interest rates make no sense. With real consumer incomes, real consumer credit, and real retail sales stagnant or falling, the stock market is a bubble. With Russia, China, and other countries moving away from the use of the dollar to settle international accounts, with Russia developing an alternative to the SWIFT financial network, the BRICS developing alternatives to the IMF and World Bank, and with other parts of the world developing their own credit card and Internet systems, the US dollar, along with the Japanese and European currencies that are being printed in order to support the dollar’s exchange value, could experience a dramatic drop in exchange value, which would make the import-dependent Western world dysfunctional.
In my opinion, it took the Russians and Chinese too long to comprehend the evil that has control in Washington. Therefore, both countries risk nuclear attack prior to the full operational capability of their conjoined defense. As the Western economy is a house of cards, Russia and China could collapse the Western economy before the neoconservatives can drive the world to war. As Washington’s aggression against both countries is crystal clear, Russia and China have every right to the following defensive measures.
As the US and EU are conducting economic warfare against Russia, Russia could claim that by wrecking the Russian economy the West has deprived Russia of the ability to repay loans to the European banks. If this does not bring down the thinly capitalized EU banks, Russia can announce that as NATO countries are now officially recognized by Russian war doctrine as an enemy of the Russian state, Russia can no longer support NATO’s aggression against Russia by selling natural gas to NATO members. If the shutdown of much of European industry, rapidly rising rates of unemployment, and bank failures do not result in the dissolution of NATO and thus the end of the threat, the Chinese can act.

The Chinese hold a very large amount of dollar-denominated financial assets. Just as the Federal Reserve’s agents, the bullion banks, dump massive shorts onto the bullion futures markets during periods of little activity in order to drive down the bullion price, China can dump the equivalent in US Treasuries of years of Quantitative Easing in a few minutes. If the Federal Reserve quickly creates dollars with which to purchase the enormous quantity of Treasuries so that the financial house of cards does not implode, the Chinese can then dump the dollars that they are paid for the bonds in the currency market. Whereas the Federal Reserve can print dollars with which to purchase the Treasuries, the Fed cannot print foreign currencies with which to buy the dollars.

The dollar would collapse, and with it the power of the Hegemon. The war would be over without a shot or missile fired.

In my view, Russia and China owe it to the world to prevent the nuclear war intended by the neoconservatives simply by replying in kind to Washington’s economic warfare. Russia and China hold all the cards. Not Washington.

Russia and China should give no warning. They should just act. Indeed, instead of step by step, Russia and China could simultaneously use the counter-measures. With four US banks holding derivatives totaling many times world GDP, the financial explosion would be the equivalent to a nuclear one. The US and Europe would be finished, and the world would be saved.

Larchmonter possibly is correct. 2015 could be a very good year, but pre-emptive economic moves by Moscow and Beijing could be required. Putin’s current plan seems to be to turn away from the West, ignore the provocations, and mesh Russia’s strategic and economic interests with those of Asia. This is a humane and reasonable course of action, but it leaves the West untroubled and undistracted by its economic vulnerabilities. An untroubled West remains a grave danger not only to Russia and China but also to Americans and the entire world.

Internal NSA Reports Detail Violation Of Laws, Regulations

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The US National Security Agency (NSA) published a cache of “transparency” reports on its web page Wednesday in response to a Freedom of Information Act (FOIA) request submitted by attorneys for the American Civil Liberties Union (ACLU).
The internally generated NSA reports, covering the years 2001-2013 and previously submitted to the Presidential Intelligence Oversight Board, show that NSA agents have consistently violated US law and the agency's own internal regulations over the past decade.
The timing of the release, on Christmas Eve, was clearly designed to ensure that the event could be buried by the US media.
The reports show that NSA agents have carried out a range of illegal activities, including electronic spying on US persons (USP), stockpiling data that the agency is required by law to delete, continuing surveillance against targets after they have been found to be USP, and “disseminating” data acquired from surveillance against USP to other government agencies and entities.
Agents specifically targeted individuals not covered by any existing order from the Foreign Intelligence Surveillance Court and used electronic surveillance technology to spy on significant others, spouses, and other associates.
Agents have failed to implement legally required “minimization” procedures, which supposedly remove individuals who have been “incidentally” swept up in the electronic dragnet from the agency’s constantly expanding set of surveillance targets, frequently neglecting to remove targets from surveillance lists even after they are known to the agency to be USP or other unauthorized targets.
The reports make clear that NSA agents have enormous leeway to spy on targets of their choosing, and that the already minor restrictions on spying stipulated by the Foreign Intelligence Surveillance Act are not seriously enforced.
Making a mockery of claims that the agency is implementing “greater transparency,” huge portions of the reports are either redacted entirely or redacted to the point of being completely unintelligible.
In one report, immediately under the heading “Computer Network Exploitation,” which refers to the US government’s hacking and electronic data mining programs, the first several large paragraphs are completely redacted.
All numbers referring to the quantity of violations have been redacted. One report states, for instance, that agents executed a “REDACTED” number of “overly broad” “database queries,” which led to the unlawful targeting of USP.
Ominous references to the expansion of surveillance operations within the US appear in one of the NSA reports, dated 2010.
After a lengthy redaction, the report states, “If approved, this change [text containing referent completely redacted] would align NSA/CSS’s procedures with the Federal Bureau of Investigation’s (FBI) procedures, which permit such searches.”
Brushing aside the overwhelming evidence provided by Edward Snowden’s leaks and substantiated in its own reports, the NSA claims in a statement on the documents that “the vast majority of compliance incidents involve unintentional technical or human error.”
“The NSA goes to great lengths to ensure compliance with the Constitution, laws and regulations,” the official NSA statement reads.
In reality, the NSA’s own documents further substantiate the mountain of evidence showing that the agency is responsible for systematic crimes against US and international law.
Previous disclosures stemming from Edward Snowden's leaks show that the agency runs numerous surveillance programs that target the same types and sources of data. On a daily basis, the Snowden documents show, NSA programs troll through data from virtually all internet and telephone users worldwide.
Based solely on the NSA’s own secret reports to the executive branch, there is no doubt that the agency is responsible for persistent violations of the specific legislation authorizing the surveillance programs and of essential democratic protections laid down in the US Bill of Rights.
Yet far from facing any form of accountability, the NSA will continue to receive the vast resources and virtually free reign it has enjoyed since 2001, when it expanded its surveillance operations in the wake of the September 11 attacks.

The Dow at 18,000: Contradictions mount in world economy

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As the year draws to a close, there is an ever-widening gap between what is taking place in financial markets and the state of the underlying real economy. Wall Street has reached record highs, with the Dow topping 18,000 this week, while the world economy remains largely in the grip of tightening recessionary conditions. This disparity portends the eruption of economic and social contradictions.
Throughout this year, financial markets have followed a basic pattern: periods of sudden turbulence followed by a new surge. The most serious was the bond market “flash crash” of October 15, when conditions emerged resembling those following the collapse of Lehman Brothers in September 2008.
But at every point, financial markets have been revived with the promise that the supply of cheap money from central banks would continue. At the same time, stagnation and outright recession continue across much of the world.
While there are signs of a modest up-tick in US growth, the European economy has yet to reach the levels it attained as long ago as 2007, with no sign of recovery in the immediate future. Japan is in recession, despite the stimulus measures unleashed by “Abenomics,” and the Chinese economy is slowing amid mounting fears that it is ripe for a financial crisis.
But financial markets power on. The plunge in the value of the Russian rouble over the past two weeks could have been the start of further instability, but after the US Federal Reserve made it clear that there would be no sudden increase in interest rates, the Dow Jones Industrial Average surged ahead, bringing its rise over the past year to 1,000 points.
The rouble collapse is a product of two processes: the precipitous fall in the price of oil, down more than 50 percent since June, and the use of sanctions by the US and the European Union against Russia, which have led to it being cut off from financial markets in what amounts to economic warfare.
Undoubtedly, there is also a large element of manipulation, directed in the first instance against Russia, in the fall of oil prices. But more broadly, the oil price plunge reflects deepening recessionary trends that stand directly at odds with the rise in the financial markets.
Oil is only one of the major industrial commodities that have experienced a significant decline this year. The price of iron ore has dropped by almost 50 percent and is at its lowest level in five years. The price of wheat, a key agricultural commodity, is down by 20 percent.
The overall decline in economic growth, and particularly its key driver, investment spending, is indicated by the fact that this year commodities are on track to be the worst performing major asset class for the third consecutive year. The Bloomberg Commodity index has fallen 14 percent this year and is at a five-year low.
It is not just the fall in commodity prices that points to deepening slump, but also the actions of the major producers. On Monday, the Saudi oil minister, Ali al-Naimi, said in an interview that the OPEC oil cartel would not cut production to maintain prices even if oil went as low as $20 per barrel. “It is not in the interest of OPEC producers to cut their production,” he declared, “whatever the price is. Whether it goes down to $20, $40, $50, $60, it is irrelevant.”
This statement represents a major shift in OPEC strategy, which has been based on regulating supply to maintain a certain price range. However, in the present conditions of falling demand and increased supply, not least because of the development of shale oil in the US, OPEC is adopting a new strategy based on maintaining a given market share, arguing that cutting production to boost prices will benefit only its competitors.
Maintaining production in the face of falling demand means forcing down the price in order to send higher-cost producers, shale oil producers and deep-water drillers, to the wall.
The same process is taking place in the iron ore mining industry, where BHP Billiton, Rio and other lower cost producers are maintaining or even increasing production levels in the face of falling prices.
These actions are in response to the continuous downward pressure in the world economy and reflect the calculation that any strategy for survival must be based on waging a war to the finish, rather than an expectation of a genuine and extended upturn sometime in the near future.
The divergence between the real economy and the financial markets is rooted in the economic breakdown that began with the financial crisis of September 2008. After mobilising trillions of dollars to prevent a complete meltdown of the financial system, central banks, with the US Fed taking the lead, have continued to pump money into the sclerotic arteries of the financial system in order to maintain it.
Nothing like it has been seen in history, as even a brief review of the amounts involved makes clear. From its founding in 1913, it took the Fed 94 years to expand its balance sheet to $900 billion, where it stood on the eve of the financial crisis. Just six weeks after the collapse of Lehman Brothers, it had doubled in size.
By the end of the year, it had tripled. It now stands at more than $4 trillion.
Where the Fed has gone, others have followed, including the Bank of Japan and the Bank of England, with the result that the combined balance sheet of central banks now totals $16 trillion, or three times the level before the crisis.
This massive injection of money has not gone to increase production, boost wages or generate jobs, but to boost the financial markets. The combined valuation of global equity markets is now around $75 trillion, compared to the low of $25 trillion in March 2009. This has brought a vast increase in social inequality, as the banks, speculators and financial operatives have increased their wealth through asset inflation, while the real wages of working people have either stagnated or declined.
The growth of fabulous wealth at the heights of society, the result of speculation and parasitism, together with worsening conditions for the overwhelming majority, signifies a build-up of enormous tensions that will erupt in social and political struggles.
At the same time, the conditions are being created for another financial crisis that could set these struggles in motion. The actions of the central banks in fuelling the insatiable demands of finance have created a massive financial asset bubble that threatens to burst if the supply of cheap cash is turned off or reduced.
As a recent report by the credit strategy department at Deutsche Bank put it: “The problem for central bankers is that they have inflated certain asset prices to levels where, if they reined in their actions too much, then they would likely see adverse market moves and a loss of confidence in the system.” The report concluded that those in charge of monetary and economic policy were nowhere nearer to finding a solution than they were in 2008–2009.
The reason is that there is no solution under the profit system. There is no return to “normal.” There is only the ever-growing threat of economic destruction through a global collapse, coupled with the impoverishment of the working class, and, at the same time, an increasingly ferocious conflict between corporate and financial giants for resources, markets and profits, leading to a new world war.

Magic Growth Numbers From The Government

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Everyone wants good news, so the government makes it up. The latest fiction is that US real GDP grew 4.6% in the second quarter and 5% in the third.

Where did this growth come from?

Not from rising real consumer incomes.

Not from rising consumer credit.

Not from rising real retail sales.

Not from the housing sector.

Not from a trade surplus.

The growth came from a Bureau of Economic Analysis survey of consumer spending on services. The BEA found that spending on Obamacare drove the US real GDP growth to 5% in the third quarter. [1]

In America, unlike in other countries, a huge chunk of medical spending goes to insurance company profits, not to health care. Another big chunk goes to paperwork, which has a variety of purposes such as collecting personal information on patients and combating fraud (probably the paperwork costs more than fraud). 
Another chunk goes for tests and procedures in order to justify further procedures. For example, if a doctor thinks a patient’s diagnosis requires a MRI, he must often first order an x-ray to establish that a cheaper procedure does not suffice. If a cancerous skin growth needs to come off, first a biopsy must be done to establish that it is a cancer so that a needless removal is not performed. And, of course, medical practicians must order unnecessary tests in order to protect themselves from the liability of relying on their medical judgment.

To regard any of these expenses as economic growth is farfetched.

There are sampling and other problems with the survey of personal consumption, and apparently Obamacare spending was all dumped into the third quarter. Why the third quarter?

The answer is that the illusion of economic recovery must be kept alive.

Real GDP growth of 5% in the third quarter is inconsistent with the sharp fall in key industrial commodity prices. It is not only oil (down 47%) but iron ore prices (down 49%), natural gas (down 30%), copper (down 15%). Pam and Russ Martens show that the fall in the producer price index for industrial commodities in 2014 is sharper than in 2008, the year of the crash.
With 30% of 30-year old Americans and almost 50% of 25-year olds living with parents, with debt-based derivative instruments impacted by falling oil and industrial commodity prices, with the likelihood that the US and EU economic attack on Russia will fail and perhaps produce retaliatory measures that could bring down the European banking system, look for 2015 to be the year that Washington will cease to get away with its economic lies.

The financial media and Wall Street economists by refusing to ask obvious questions have left the American people unprepared for another drop in their living standards and ability to cope.

Evil Torturers Catch A Break: How America Got Distracted From A National Travesty

How the Sony story and Cuba reset eclipsed the torture report's horrors -- causing a dangerouus lack of outrage

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The United States is in real trouble when the story about the hacking into Sony Pictures computers and their decision to pull an inane comedy totally big foots the deeply troubling Senate Intelligence Committee’s study of the CIA’s Detention and Interrogation Program.
Talk about using the holidays to flush bad news. Between the salacious internal Sony emails, the Obama administration’s watershed reset of U.S.-Cuban relations, and Christmas the average American will not get reporting on the  fine print in the Senate Committee report nor a full analysis of the ambiguous CIA response.
In this case the devil really is in the details. For years the public was told the torture techniques saved lives, prevented additional terror attacks and helped lead to the capture of Osama bin Laden. Not so, says the Senate report, which goes on to chronicle years of obfuscation, deceit and deception by a CIA that was hell-bent on covering its tracks. Now the CIA is saying it is “unknowable” if the torture techniques produced results.
Even well into the Obama administration the Agency continued to go to the extraordinary steps of hacking into the Senate Committee’s computers. The Agency’s track record  already includes the covert destruction in 2005 of 92 videos of detainee interrogations, which would have been critical to congressional investigators. In 2010 a federal special prosecutor declined to prosecute.
What emerges from the Senate report is a CIA that post-9/11 quickly turned to outside contractors and used multiple “black sites” where they employed what they euphemistically called  “enhanced interrogation techniques.” These practices  included waterboarding, forced rectal feeding, extended sleep deprivation, keeping subjects in prolonged stress positions including standing on broken bones, closing detainees into coffin-like boxes,  staging of mock executions, as well as making threats to kill or rape detainee family members.
Dozens of individuals were wrongfully detained by the CIA and  two of the Agency’s informants were mistakenly tortured. One detainee died of hypothermia after 48 hours of sleep deprivation, getting doused with cold water and being  chained to a concrete floor.
Certainly these are all activities that would be defined as illegal under the United Nations Convention Against Torture, which the United States ratified in 1994. Under the terms of the Convention there are no “exceptional circumstances,” like  preventing a potential terrorist act, which would permit the use of these techniques that deliberately inflict “severe pain or suffering, whether physical or mental.”
The Senate Committee report concludes that the EIT techniques were ineffective  and that the Agency regularly misled the White House and Congress about the nature of the program and its efficacy. The outside contractors, who pocketed more than $80 million from 2001  through 2009, carried out “inherently governmental functions such as acting as liaison between the CIA and foreign intelligence services, assessing the effectiveness of the interrogation program, and participating in the interrogation of detainees held in foreign government custody.”
New Crossroads labor correspondent Gregory Heires writes in his aptly titled post  “Outsourcing Torture”  that “the contract workers had a conflict of interest. They were responsible for carrying out torture while also determining whether it was effective and safe.”  Heires notes there was a built-in financial incentive to be brutal.  The contractors who waterboarded detainees got $1,800 a day, four times the amount paid to interrogators who did not.
Some of the most compelling material appears in the attachments of the Senate report in the form of additional statements made by individual senators who served on the committee.
Colorado Sen. Mark Udall says the investigation documented that the CIA’s interrogation program was “shaped and conducted by individuals who didn’t understand what they were doing and who had a financial stake in representing the program as effective.”  That inherent conflict of interest was even more problematic because the EIT program  “was managed incompetently by senior CIA personnel,” writes Udall.
“The ‘enhanced interrogation techniques’ were far more brutal than anyone understood. Perhaps most importantly, these techniques did not work. Nonetheless, the program was sold to the White House, the Department of Justice, the Congress, and the media as a necessary program that provided unique information that ‘saved lives,” according to Udall.
Udall says even as late as last year the CIA was still not being straight with Congress. “As I discovered in late 2013, an internal CIA review of the program initiated under former Director Panetta corroborates some of the significant findings of the [Senate committee] Study and acknowledges significant errors made during the course of the CIA program—but this internal review conflicts with the CIA’s own official response provided to  the Committee, which denies or minimizes those same errors.”
Udall reports that Committee staffers spotted those  glaring contradictions between the internal Panetta review’s conclusions about the enhanced interrogation program, provided years earlier to them, and the official June 27, 2013,  response submitted by the CIA to the Senate Committee.
“Committee staff grew concerned that the CIA was knowingly providing inaccurate information to the Committee in the present day—which would be a serious offense and a deeply troubling matter for the Committee, the Congress, the White House, and our country,” writes Udall. “To preserve evidence of this potential offense, Committee securely transported a printed portion of the draft Panetta review from the CIA-leased facility to the Committee’s secure offices in the Senate.”
In March of this year Udall wrote President Obama to complain of an “unprecedented action” taken by the CIA against the Senate Intelligence  Committee which left unchallenged would undermine the Senate’s Constitutional obligation to exercise oversight and as a direct consequence  “our democracy.”
A few days later the story broke about the CIA’s unauthorized hacking into  the Intelligence Committee’s computers. Udall writes it was an illegal search “conducted out of concern that Committee staff already had access to the Panetta review, a document they were fully cleared to see. More troubling, despite admitting to the Committee that the CIA conducted the search, Director Brennan at the same time publicly referred to “spurious allegations about CIA actions that are wholly unsupported by the facts.”
At stake here is whether or not the nation’s intelligence agency was caught in wholesale violations of the U.S. Constitution, while breaking several Federal criminal laws and blowing off a standing Executive Order, all in a  Machiavellian bid to ferret out how it was Senate investigators had caught on to the evolving CIA cover story.
Udall says Brennan has declined to respond to subsequent questions about the CIA hacking escapade that targeted the Senate Committee. Instead, explains Udall, Brennan’s company lawyer, the acting CIA general counsel, has “filed a crimes report with the Department of Justice about the Committee staff’s actions to preserve the Panetta review  documents.” According to Udall this is the same general counsel “who was involved in the 2005 decision to destroy the CIA’s interrogation videotapes.”
“Of the many examples of impeding congressional oversight documented in the study, none is more striking than the decision  by CIA leaders to destroy videotapes of CIA interrogations out of a concern that Congress might discover evidence of misconduct and brutality,” wrote Maine Sen. Angus King “There is no excuse for this decision and those involved should no longer be associated with the CIA or the United states government.”
Like Udall, King finds the ever evolving CIA cover story problematic.
“In its official response to the study, the CIA contradicts many of its previous claims of unqualified effectiveness by arguing that it is now “unknowable” whether the use of enhanced interrogation techniques and further contends that its past assertions were “sincerely believed but inherently speculative,” writes King.  “Yet in the long and unfortunate history of this program, no one in the CIA’s leadership expressed such an equivocal view  of the techniques’ effectiveness. What was once certain is now ‘unknowable;’ this migration of rationales underlines for me the magnitude of the prior misrepresentations.”
For Maine Sen. Susan Collins the debate over the CIA’s EIT program’s effectiveness obscures the deeper issues raised by the existence of the CIA program in the first place.
It bears repeating that torture need not be ineffective to be wrong. The United States correctly answered the question of whether torture should be prohibited when our nation ratified the Convention Against Torture in 1994. The prohibition  against torture in both US law and international law is not based on an evaluation of efficacy at eliciting information. Rather, the prohibition was put in place  because torture is immoral and contrary to our values.
Unfortunately, nothing in the response to the Senate report by  current CIA Director John Brennan had anywhere near the moral clarity found in Collins’ assessment.  Brennan, who has been a critical adviser to President Obama, held a very unusual 45-minute press conference at CIA headquarters to respond to the report’s release.
Brennan opened his appearance with a very dramatic recitation of the bloody events on Sept. 11 and described a  post 9/11 CIA in a situation where “there were no easy answers” and concern over preventing a potential  second series of attacks was of paramount concern. During that period Brennan himself was the CIA’s deputy director.
Brennan went to great lengths to  distance himself from the program and his time at the agency, which coincided with its creation and operation. “I was aware of the detention interrogation program. I had some visibility into some of the activities that were there. I was not in the chain of command. I did not have authority over the implementation of that program or the management oversight over it.”
Brennan recounted that early on in President Obama’s first term the president denounced the EIT tactics as “contrary” to American values and “unequivocally  banned them.”  Brennan said he also found them “abhorrent.” Yet on the critical question of their use down the line  he said he would “defer to the policymakers in future times” as to whether the CIA should ever revert back to its EIT playbook.
Director Brennan also took issue with the Senate Committee report’s findings that EITs failed to produce worthwhile intelligence. “There was information  obtained subsequent to the application of EITs from detainees  that was useful in the bin Laden operation,” Brennan insisted.
As for the decision by his colleagues back in 2005 to destroy all of those videotapes of the Agency’s EIT handiwork in action, he refused to second-guess his colleagues. “I think that has all been looked at quite a bit over the years,” Brennan told reporters.
The 500-plus pages of the Senate Committee report that was publicly released is less than 10 percent of the more than 6,000 pages compiled by the panel’s investigators, the remainder of which remains classified. No telling when we will get to read it. Consider that the full text of the Vietnam era Pentagon Papers did not see the full light of day until 2011.