Showing posts with label money. Show all posts
Showing posts with label money. Show all posts

Wednesday, August 19, 2015

Many respected economists say Corbyn’s ‘Peoples’ QE’ plan to issue money to invest in ways that could create economic growth is a good one

There are politicians and media commentators every day claiming that Jeremy Corbyn’s plan for Peoples’ QE is unrealistic and economically unfeasible. The policy would involve government issuing money to invest in public services and in loans and grants for small and medium businesses, in order to increase economic growth (1).

Former Foreign Secretary Jack Straw has claimed that basic economics tells us it won’t work. Yvette Cooper, one of Corbyn’s rivals for the post of labour leader, claims that as an economist she can say it would be disastrous (2) – (3).

Labour Shadow Chancellor Chris Leslie has even claimed that it would lead to both inflation and an increased national debt. That would be pretty surprising if it happened, given that inflation reduces the value not only of a nation’s currency but also its debts denominated in that currency, suggesting the Shadow Chancellor’s grasp of basic economics is somewhat shaky (4).

Gordon Brown's continuation of "light touch regulation" of the banks (a euphemism for the minimal regulation begun under Thatcher) led to the banking crisis. And his claim that he would "end the cycle of boom and bust forever" predictably turned out to be nonsense. So New Labour's economic credentials aren't exactly great.

Yet many highly respected economists, including some who predicted the banking crisis say it and Corbyn’s other anti-austerity policies would work – and work far better than the current UK government’s counter-productive ones.

Australian economics professor Steve Keen, who predicted the banking crisis, says it’s a good policy. Nobel prize winning former World Bank economist Joseph Stiglitz backs it and Corbyn’s other economic policies. So does Paul Krugman (5) – (8).

Even some columnists for the Financial Times have said the policy could work (9).

Critics of the policy say it would lead to inflation. It would lead to some inflation, but inflation is currently zero, while quarterly economic growth is under 0.5% and unemployment is 1.85 million on official figures and much higher in reality, as these figures are fiddled. So creating economic growth and jobs should be a much higher priority than inflation at the moment (10) – (11).

Ha Joon Chang, a South Korean economist who teaches in the US, wrote in his book ’23 Things They Don’t Tell You About Capitalism’ that one IMF study found inflation does not negatively affect economic growth or living standards until it reaches 8% - and that some other studies put the figure at 20% (12).

Of course that doesn’t mean unlimited amounts of money could be issued each year, nor that an eye wouldn’t have to be kept on the effects on inflation. But Corbyn has never suggested printing unlimited amounts of money. The plan is to issue money and invest it in ways that will lead to increased economic growth and so increased tax revenues. That would reduce our national debt, not increase it. This is, as the plans critics would say “basic economics”.

It’s also worth remembering that all the New Labour politicians criticising Corbyn and claiming knowledge of economics backed the deregulation policies New Labour adopted from the Conservatives, which led to the banking crisis, the worst economic disaster for the UK since the 1930s. And that that crisis led to Labour losing voters’ trust on the economy and the two elections since it. Taking their advice on economics would be a bit like taking advice on how to prevent fires from an arsonist.

(1) = Tax Research UK 03 Aug 2015 ‘Chris Leslie has got Corbynomics wrong’, http://www.taxresearch.org.uk/Blog/2015/08/03/chris-leslie-has-got-corbynomics-wrong/

(2) = Scotsman 13 Aug 2015 ‘Jack Straw adds voice to anti-Jeremy Corbyn chorus’, http://www.scotsman.com/news/uk/jack-straw-adds-voice-to-anti-jeremy-corbyn-chorus-1-3858368

(3) = www.guardian.co.uk 12 Aug 2015 ‘Yvette Cooper says Labour rival Jeremy Corbyn's policies not credible or radical’, http://www.theguardian.com/politics/2015/aug/13/yvette-cooper-jeremy-corbyn-policies-not-credible-labour

(4) = Guardian 03 Aug 2015 ‘Jeremy Corbyn to unveil public investment plan to end austerity’, http://www.theguardian.com/politics/2015/aug/02/corbyn-vision-2020-end-austerity-public-investment-plan?INTCMP=sfl

(5) = https://en.wikipedia.org/wiki/Steve_Keen

(6) = https://twitter.com/profstevekeen/status/629411010542223360

(7) = Guardian 27 Jul 2015 ‘Joseph Stiglitz: unsurprising Jeremy Corbyn is a Labour leadership contender’, http://www.theguardian.com/politics/2015/jul/26/joseph-stiglitz-jeremy-corbyn-labour-leadership-contender-anti-austerity

(8) = CNBC 18 Aug 2015 ‘‘People’s QE?’ Left-wing leader’s plans for the UK’,
http://www.cnbc.com/2015/08/18/peoples-qe-left-wing-leaders-plans-for-the-uk.html

(9) = FT Alphaville blog 06 Aug 2015 ‘ Corbyn’s Peoples’ QE could actually be a decent idea’,
http://ftalphaville.ft.com/2015/08/06/2136475/corbyns-peoples-qe-could-actually-be-a-decent-idea/?Authorised=false

(10) = BBC News 30 Jun 2015 ‘UK's economic growth revised up’, http://www.bbc.co.uk/news/business-33323999

(11) = BBC News 15 Jul 2015 ‘UK unemployment rises for first time in two years’,
http://www.bbc.co.uk/news/business-33535114

(12) = Ha Joon Chang (2010) ‘23 Things They Don’t Tell You About Capitalism’, Penguin / Allen Lane, London, 2010, ‘Thing 6’, page 55 of Allen Lane hardback edition

Saturday, January 03, 2015

Big Money, not the house of Lords, is the really big problem with our democracy - and it's not just a Westminster problem, it's an SNP problem too

I can see why Alex Salmond would suggest making the House of Lords elected, but on its own that will not fix the biggest problems with our democracy. The US has an elected upper house, and even more corruption in the system than the UK has. Nor will devolution, or even independence, fix the biggest problem with our democracy without other reforms (1).

That’s because the biggest problem is that we allow big banks, companies and the super-rich to buy up political influence. They do this partly by big donations to party funds and election campaigns.

The big political parties use the donations to pay advisers, advertisers, graphic designers and pollsters to design campaigns of leaflets, billboards and adverts to persuade people to vote for them. Then, when they’re in government, they pay the donors back many times over, with taxpayers’ money.

They do it with public contracts that massively over-pay companies and have no safeguards to ensure value for money for taxpayers, for instance with PFIs. They do it by permitting tax havens in UK dependencies like the City of London and the Channel Islands so the big donors can avoid taxes easily. They do it by letting them off with most of their evasion of tax even when they’re caught, through “sweetheart deals”. They do it by not enforcing anti-monopoly laws and de-regulating whole industries so a few large companies can dominate each economic sector and charge consumers what they like whether their own costs are going up or down. This de-regulation also led to the banking crisis.

In the last 5 years the Conservative party has got more than half its donations from the financial sector – mostly big banks and hedge funds. It has failed to bring in any proper regulation of the banks of the Glass-Steagall kind that would ban high street savings banks from also being “investment” (actually mostly stock market casino) banks (2).

To save on the millions every few years it would take to publicly fund the election campaigns of all candidates at a low and equal level, we end up losing tens to hundreds of billions every single year in big companies allowed to overcharge us for electricity, food and many other things ; in PFI contracts ; in lost tax revenues ; in companies allowed to grow too large so there is no longer real competition to reduce prices for consumers ; in de-regulation leading to everything from higher prices to banking crises.

The Revolving Door Between Government and Big Business

They also do it through the “revolving door” between government and the firms its meant to regulate. If government ministers, civil servants, MPs and advisers do favours for big donors to party funds, we allow them to leave government and go straight to work for firms they were regulating, deciding on taxation for, or giving contracts to.

For instance Sean Worth, an adviser to David Cameron on NHS “reforms” (largely contracting out services to private firms) left that job after just two years, to become an adviser to MHP Communications, which lobbies on behalf of the Priory Group, which runs mental health services for the NHS (3).

Labour in government were no different. Health Secretaries Alan Milburn and Patricia Hewitt both contracted out NHS services to the private sector, and both became paid advisers to private healthcare firms on leaving government (4) – (5).

 Many other former ministers and advisers, Labour and Conservative, have done the same (6).

And one of the ways the parties pay back donors to party funds is by allowing people employed by these firms to take up jobs in the same government departments, so that the biggest firms are able to scrap any regulations they don’t like, as well as avoid competition laws being enforced to break them up when they become too big.

Not just a Westminster problem – a Scottish and SNP problem too

And the problem is not just at Westminster. Even if Scotland was independent the same problem of big business and the super-rich buying up political influence would remain.

The SNP has already shown it can be bought by big donors too.

Within a month of receiving a £500,000 donation from Brian Souter, who owns much of Highland Transport group,  in January 2007, the SNP scrapped its policy of re-regulation of the bus network. And to this day the Scottish governments has no plans to renationalise or even seriously re-regulate bus services (7) – (8).

Legalised Corruption

All of this is political and government corruption by any other name. In legal terms it may not be corruption, because while there are laws against bribes in money, there are no laws against taking those bribes as big donations to party funds in return for favours at taxpayers’ expense, nor taking them in kind as paid employment, nor in letting representatives of the banks or companies into government to write their own regulations in return. But there should be laws against it. In moral terms, and in its effects on voters and taxpayers’ interests, isn’t it just as corrupt as taking a bribe?

The almost powerless House of Lords is a distraction from the big problems

The House of Lords has almost no power. The majority of what it does is to review bills sent to it by the Commons (often badly thought out laws rushed through by the government) and suggest amendments to them. It can do that twice. When it comes to the third time it has to approve them even if the commons has rejected all the Lords' amendments. That’s been the case for over 100 years since the 1911 Parliament Act.

Scrap it and don't replace it and the government can rush through half-arsed laws without any oversight or amendment and frequently no-one will even notice till it's too late.

Scrap it and replace it with an elected upper chamber, without having fixed all the other problems, and you end up like the US - with either a rubber stamp (if the same party or parties control both houses) or gridlock with almost no laws passed at all (if different parties control the two houses), and most laws only passed if they benefit big donors to election campaign funds.

I'm not saying there are no problems with the Lords - how Lords are appointed needs changed. Party leaders shouldn't just be able to hand seats to big donors to party funds, and there doesn’t seem much justification for hereditary peers.

Electing them is one possibility, but on it’s own will solve little and might well just hand the party machines and big donors to party funds as much influence in the upper house as they already have in the more powerful House of Commons.

Binning our votes unrepresented – First Past The Post Elections

Another problem is than the the First Past the Post electoral system used for UK General Elections, which often gives single parties big majorities on a minority of the votes and throws away any vote not cast for the winning candidate in a constituency unrepresented (and the winning candidate can win on the largest minority of the vote, doesn't even need 50%) .

In the 2010 General election more than half the votes cast were for losing candidates and were effectively binned unrepresented.  In 2005 and 2010 two-thirds of MPs didn’t even have a majority of the votes cast in their constituency. And it’s even worse than that, because of safe seats. The safer a seat the less voters bother voting at all  (9) – (10).

Lack of Democracy inside parties

A fourth problem is the lack of any written constitution or law requiring democracy inside political parties.
So for instance in the Labour party, the party leader can change policy to benefit big donors to party funds at any time, and ignore votes by party conference as “non-binding”.

Whether we are part of the UK or an independent country, private donations to political parties and the revolving door between government and big business are two of the biggest weaknesses in our democracy.

How to fix our democracy

Public funding of all candidates in elections at a low and equal level would allow the giving or receiving of any private political donation to be made a criminal offence. This would have to include any donation from any source, as otherwise companies could use phony “charities” or industry front groups.

Making it also a criminal offence with a stiff jail sentence to move between employment in a government department in any capacity and employment in any firm regulated by, given contracts by or whose taxes were decided by that department within a 10 year period would end the revolving door syndrome.

 Those two measures could take most of the big money influence out of politics and make politicians look to the people who elected them first.

We could end dodgy PFI contracts. It could end de-regulation of the kind that led to the financial crisis and allow the banks to be re-regulated to prevent another one (six years after the crisis there is still no law against high street savings banks also being “investment” banks). It could stop government letting big donors to party funds use government permitted tax havens in UK dependencies like the Channel Islands, and end “sweetheat deals” that let Goldman Sachs and others off with millions in tax at a time, even when they are caught evading it.

If we just have an elected House of lords, or get more devolution or independence, and think that’s democracy fixed though, business will continue as usual with the majority’s interests over-ridden by those of big donors to party funds.

A written constitution specifying internal democracy within parties (e.g constituency parties to have the sole right to select or deselect candidates ; votes of party conference must become party policy etc) would also be progress, but is similarly a minor issue as long as big money is allowed to controls our governments and opposition parties.

(1) = Guardian.com 20 Dec 2014 ‘Alex Salmond calls for ‘peasants’ revolt’ vote to abolish House of Lords’,
http://www.theguardian.com/politics/2014/dec/20/alex-salmond-peasants-revolt-type-referendum-abolish-house-of-lords

(2) = BBC News 09 Feb 2011 ‘More than half of Conservative donors 'from the City'’, http://www.bbc.co.uk/news/uk-politics-12401049

(3) = Guardian 23 Nov 2012 ‘David Cameron's former NHS privatisation adviser becomes lobbyist’, http://www.theguardian.com/politics/2012/nov/23/david-cameron-privatisation-adviser-health-lobbyist

(4) = Guardian 17 May 2011 ‘Former Labour ministers rushing to take private sector jobs, report finds’, http://www.theguardian.com/politics/2011/may/17/labour-ministers-consultancy-private-sector

(5) = Telegraph 12 Jun 2012 ‘Social mobility man Alan Milburn is on the way to a million’,
http://www.telegraph.co.uk/news/politics/9324145/Social-mobility-man-Alan-Milburn-is-on-the-way-to-a-million.html

(6) = Lobbying Transparency – Revolving Door is Unhealthy, http://www.lobbyingtransparency.org/15-blog/general/62-revolving-door-is-unhealthy

(7) = Scotsman 22 Apr 2007 ‘SNP under attack after bus U-turn’, http://www.scotsman.com/news/scotland/top-stories/snp-under-attack-after-bus-u-turn-1-744256

(8) = Scotsman 12 Feb 2011 ‘£500,000 war chest for Alex Salmond’, http://www.scotsman.com/news/163_500_000_war_chest_for_alex_salmond_1_1493699

(9) = Electoral Reform Society 6 May 2010 ‘The UK General Election 2010 In-depth’, page 35,
http://www.electoral-reform.org.uk/images/dynamicImages/file4e3ff1393b87a.pdf

(10) = IPPR 2011 ‘Worst of Both Worlds -Why First Past the Post no longer works’ , by Guy Lodge and Glenn Gottfried, http://www.ippr.org/assets/media/images/media/files/publication/2011/05/Worst%20of%20Both%20Worlds%20Jan2011_1820.pdf
and
http://blogs.lse.ac.uk/politicsandpolicy/first-past-the-post-no-longer-fit-for-purpose/

Friday, March 08, 2013

There is a magic money tree for governments with their own currency - and Cameron has already used it in quantitative easing for the banks - so why not for things that benefit everyone?

Prime Minister David Cameron is completely wrong when he says there is “no magic money tree” – there is for any government that has it’s own currency which it can issue in any quantity it likes; and for private banks which can create money – but only create it as debt. Cameron’s government, like the last government, has used it’s “magic money tree” repeatedly in “quantitative easing” to pad the banks’ reserves. There is no reason he can’t use it to create money for more worthwhile causes that benefit everyone.

Vince Cable is right that we need stimulus spending, but why should we borrow it from banks and hedge funds, increasing our debts, when the government can print it or issue it digitally instead? It’s created out of thin air either way. The financial crisis was the result of most money being created as debt - loans and mortgages - by the banks, combined with deregulation, as Australian economics professor Steve Keen points out (1).

The government should print money and spend it on green energy research, investment in infrastructure (transport, education etc), plus grants and zero or low interest loans to small and medium sized businesses. If that creates a little inflation, that's not so bad, as devaluation of the pound will also reduce the size of our debts denominated in pounds.

The British government’s 2% inflation target and reliance on borrowing rather than printing money are the result of over-sized banks that can donate to much to party funds. Nobel prize winning economist Ha Joon Chang points out that even IMF studies suggest inflation doesn't negatively affect growth till it reaches 8% - other studies say 20%. (2)

Some will immediately cry hyperinflation, but in actual cases of hyperinflation, like Weimar Germany or Zimbabwe, the causes were French military occupation and control of the steel and coal output of the Rhur valley, and international sanctions, respectively, combined with political crises, not printing money (3). The bank executives and hedge fund managers would like people to believe otherwise because they profit from other peoples’ debts and don’t want those debts shrunk by moderate inflation.

If the government won’t do that we still have one other option – set up lots of small local or regional savings and loans companies like the “Bank of Dave” (Burnley savings and loans) set up by businessman Dave Fishwick (4) – (5).

This also has implications for the debate on whether Scotland should become independent. One potential advantage of independence would be that Scotland could print it’s own currency and spend it how it chose whatever the City of London financial sector said.

(1) Steve Keen (2011) ‘Debunking Economics’, Zed Books, 2011

(2) = Ha Joon Chang (2010) ‘23 Things They Don’t Tell You About Capitalism’, Penguin / Allen Lane, London, 2010, ‘Thing 6’, page 55 of Allen Lane hardback edition

(3) = Ha Joon Chang (2010) ‘23 Things They Don’t Tell You About Capitalism’, Penguin / Allen Lane, London, 2010, ‘Thing 6’, pages 51-62 of Allen Lane hardback edition

(4) = Burnley Savings and Loans, http://www.burnleysavingsandloans.co.uk/

(5) = Guardian 01 Mar 2013 ‘Bank of Dave: Fighting the Fat Cats; The Wedding Shop – TV review’, http://www.guardian.co.uk/tv-and-radio/2013/mar/01/bank-of-dave-fighting-fat-cats

Thursday, February 21, 2013

Why government can print money and give it to ordinary people and small companies without hyper-inflation ; private banks issuing money as debts is as much creating money out of nothing as printing it is; ALL money is created out of nothing ; ALL money and debt exist only as agreed ideas and can be created or destroyed or revalued any way we choose to as societies

The supposedly hard-headed and realistic analysis of our current situation is that we are doomed to higher taxes and cut services until we can pay off our debts; and that no action by government can change this fact. This is the version of reality that suits the people who caused the crisis – big banks, hedge funds, billionaire speculators. It also suits the big parties in government who get donations to party funds from them.

So the people who caused the problem get to keep on getting big bail-outs at taxpayers’ expense while being able to avoid paying most tax themselves through tax havens and multinational corporate structures.

We are not dealing with a hard unchangeable reality, but with the confused idea that money and debt exist anywhere but in our heads. Banks can and do create money out of nothing as debt simply by issuing a loan or mortgage. Governments can create it out of nothing by printing it or by issuing loans or grants. These are the two main ways it has come into circulation for at least a century. Similarly lenders can “write off” some or all of a debt and it instantly vanishes.

And, no, there is no way to limit the amount of money issued to the value of goods and services created because that value is also a subjective judgement based on incomplete information – which is why stock market valuations go up and down constantly and lead to economic booms and busts.

To limit the amount of money in circulation to the value of the gold reserves of the world was one past method of limiting the supply, but it was a completely arbitrary one and the gold standard contributed to causing the Great Depression by limiting the amount of new loans that could be made by banks or grants by government.

So there is no amount of money which will accurately reflect the value of the economy.

Money and debt are not unchangeable realities but shared ideas. How much of them exists and how much can be created and how it should be distributed are all things that we can change in any way we want to if we collectively decide to. Getting enough people to realise this is the only hard part.

It isn’t too complicated for the majority of people to understand, as the banking lobby want us to believe. it’s simple. As the late American economist J K Galbraith, who served under President Franklin D Roosevelt, wrote “The process by which money is created is so simple that the mind is repelled.”

Governments printing money and issuing it as grants, or zero interest loans or low interest loans is no different from private banks issuing it as loans or mortgages, other than that government can take into account aims in lending other than it’s own fairly short term profit. It can consider what investments are important to develop our economy and society, reduce poverty or reduce environmental damage over the long term.

The usual scare story you will hear at this point is that if we print money it will cause hyper-inflation. It could, if you printed an amazing amount of it, but in reality hyper-inflation has pretty much never happened unless a country is also under economic sanctions (e.g Zimbabwe) or under occupation and with a large part of it’s economic output going to other countries after defeat in a war (e.g Germany after World War I when France occupied the Rhur valley and all steel and coal from there went to France) (1).

Studies done by the IMF and cited by Chang show no fall in growth rate from inflation until it reaches at least 8% per year, while less conservative studies put the rate at 20% (2).

While inflation devalues money it also devalues any debt, as debt is denominated in money – so the higher inflation is the faster debt shrinks; and that is why banks and other lenders want low inflation. The British and American governments are heavily in the pockets of banks and hedge funds who are major donors to the party funds of all the main parties.

The Conservative party in the UK for instance, gets more than 50% of it’s donations to party funds from banks, hedge funds and other financial sector firms (3). The new head of the Bank of England, which sets the official interest rate and regulates other banks, is a former Goldman Sachs executive (4). All three main UK parties leaders welcomed his appointment enthusiastically.

Australian economics Professor Steve Keen has also shown that a major cause of the financial crisis is most money having been created as debt by private banks, with a recession resulting when the amount of debt issued is so great that the debtors can no longer repay it and the lenders will no longer issue new loans or forgive it, resulting in a crisis of confidence among both consumers and lenders. He suggests government printing money and giving it to debtors to pay off their debts (5). This would certainly solve the immediate crisis, but it wouldn’t stop the cycle starting all over again.

Only nationalised banks printing money and issuing it as grants and low or zero interest loans can do that. Of course it would still be unwise to issue infinite amounts of money without any checks on whether money issued as a loan or grant will increase government revenues or reduce it’s costs in future. So government controlled banks, after helping debtors pay off their debts and paying off it’s own debts by printing money, would have to ensure that some of it’s loans were issued to get a return, while others would be issued as grants for purposes other than getting a financial return, with the former funding the latter in the long term.

This is an idea which transcends the normal political divisions – there are even some Conservative MPs in the UK who are proposing something very similar.

I’m not sure that the Money Reform Party are right in suggesting that private banks issuing loans should be made illegal. That could have it’s own risks in making it impossible for businesses that don’t donate to party funds to get loans at reasonable rates , but we certainly need at least one government owned bank in each country creating money as loans and grants for government spending, for loans to small and medium sized businesses and to help people out of debt.

The reality is that we have plenty of options for paying off the debt and reducing poverty and inequality in our society, just not ones that these dominant players like. They would much prefer we sign up to the idea that it’s all unchangeable and that the hard reality is that we have to keep on issuing and distributing money primarily in ways that benefit them, even if it’s at huge cost to everyone else.

They have even got governments to legalise a ‘futures trade’ in food which allows them to basically bet that the price of a particular type of food will rise, before buying and stockpiling lots of it to ensure it does rise. This is at a cost of increased food prices which can mean hunger or death for people across the world, including in Haiti where for many years it has become common for parents to buy ‘mud cakes’ of clay and salt to fill their childrens’ bellies when they can’t afford actual food.

While things are not nearly that bad for most people in the developing world we continue to see poverty at levels where people must often choose between for instance eating or heating their home many days in winter; and governments are taking benefits away from the genuinely disabled and forcing the unemployed to work unpaid for big companies. Most of those who can get full time work are working harder and longer hours for the same or less pay. Millions can’t get work at all, or can only get part-time work when they want full-time.

The billionaires and the big firms (including many newspaper owners), along with the heads of the big parties they donate to the election funds of, have successfully redirected many peoples’ anger at the situation away from themselves – those with the actual power and money who are actually causing the problem – and onto public sector employees and benefits recipients – including the unemployed and the disabled.

Every time you are told that we just have to face up to the reality that we and our grandchildren will have to pay off our current debts and suffer for the actions of the banks, you are being lied to and fed the line those banks want you to believe. Don’t believe it – and tell others the truth.

(1) = Ha Joon Chang (2010) ‘23 Things They Don’t Tell You About Capitalism’, Penguin / Allen Lane, London, 2010, ‘Thing 6’, pages 51-62 of Allen Lane hardback edition

(2) = Ha Joon Chang (2010) ‘23 Things They Don’t Tell You About Capitalism’, Penguin / Allen Lane, London, 2010, ‘Thing 6’, page 55 of Allen Lane hardback edition

(3) = BBC news 09 Feb 2011 ‘More than half of Conservative donors 'from the City'’,
http://www.bbc.co.uk/news/uk-politics-12401049 (headline is inaccurate, should read ‘donations’ not ‘donors’)

(4) = Guardian 03 Dec 2012 ‘New Bank of England head will have too much power, warns insider’, http://www.guardian.co.uk/business/2012/dec/03/bank-england-head-power-new

(5) = Steve Keen (2011) ‘Debunking Economics – Revised and Expanded Edition’, Zed Books, London and New York

Wednesday, July 06, 2011

Why Gaddafi running out of fuel or money or being killed would not guarantee an end to the war in Libya

There have been reports that Gaddafi’s forces may be close to running out of fuel altogether, mostly assuming that this will force his side to surrender. This assumption is based on the North African campaigns in World War Two, in which Rommel was eventually forced to surrender due to lack of fuel for his tanks (1).

However, while that’s possible, there is no guarantee of Gaddafi’s forces surrendering if this happens. They might, but it’s as or more likely that without a negotiated peace they would switch to using guerrilla, insurgent, terrorist or resistance tactics (choose whichever term you prefer), as happened in Iraq after the defeat of it’s military. The fact there are no large numbers of foreign troops occupying Libya (only a few special forces trainers and spotters for airstrikes)  might make this less likely or a smaller insurgency than in Iraq, but it’s still a possibility that has to be taken into account.

Gaddafi’s forces seem to only control one functioning refinery – at Zawiyah – and the oil pipeline to it has been cut by the rebels (2). This should certainly mean that sooner or later his forces will run out of fuel for their tanks, truck mounted Grad rocket launchers, mobile artillery and pick up trucks. How soon (or not soon) is still anyone’s guess, as no-one knows how much oil Gaddafi has stored in reserve in barrels in Tripoli that could be sent to the refinery. (This also raises the question of why NATO hasn’t bombed the refinery and why it tried to persuade the rebels not to cut the pipeline – issues I’ll cover in a separate post).

The claims by Libyan defectors that Gaddafi was running out of fuel and money were made before the 13th of June though (and seem to mostly have been made by one defector – the former head of Libya’s central bank). He claimed that this would happen within days or a couple of weeks (3). So either it’s going to happen very soon, or else these claims are just based on guesses, wishful thinking, or are propaganda designed to encourage any of Gaddafi’s people hearing it to defect.

Fuel prices have certainly gone up massively in the parts of Libya controlled by Gaddafi’s forces (starting even in May), but it’s possible this is partly due to Gaddafi prioritising supplies to his armed forces (4) – (5).

Similarly reports that Gaddafi is running out of money are no guarantee of his regime falling, nor would an airstrike killing him (a strategy which has failed for over 100 days now and has never worked anywhere else). The assumption that Gaddafi running out of money will lead to the surrender of his forces assumes their primary motivation is money. That may well not be the case.

Assuming killing Muammar Gaddafi alone will end the civil war may be an assumption that turns out to be true, but could equally be as false as the assumption in Iraq that all the insurgents were Sunni and Ba’athist ‘dead enders’ who supported Saddam and that they would surrender when he was gone. In fact most of the insurgents weren’t hardline Ba’athists at all and many of them were Shia.

Bombing carried out by the US air force and the British RAF from 1991 to 2002, combined with sanctions, repeatedly failed to either kill Saddam or generate a military coup against him, so hopes of Gaddafi’s own forces, generals or ministers overthrowing him may be wishful thinking too.

US and NATO military planners are generally meant to plan for the “worst case scenario”, but instead most of their plans (and those of the governments giving them orders) are hugely optimistic and ignore the possible pitfalls and false assumptions involved. As a result most of them either fail, or only succeed at great cost in lives.

Saif Al Gaddafi has repeated that his father will accept elections overseen by international observers in return for a ceasefire (6) – (7). He may or may not be telling the truth, but given all the potential ways this war could drag on with heavy civilian casualties without a peace settlement, taking up the offer might be a sensible course for the rebels and NATO.

Even if it doesn’t work they at least get more Libyans and more people and governments around the world on their side by showing they were willing to try for a peaceful solution. Currently their refusal to accept any offer of negotiations that doesn’t include Gaddafi and his sons giving up power entirely before negotiations even begin is making a long civil war more likely. They have plenty of justifiable reasons to be angry at the Gaddafis’ dictatorship and to want rid of them, but the reality is that at least giving negotiations a try would be the best option.


(1) = The Economist 16 Jun 2011 ‘The colonel is running on empty’,http://www.economist.com/node/18837167?story_id=18837167

(2) = Channel 4 News 29 Jun 2011 ‘Tripoli Pipeline Attack ‘endgame’ for Gaddafi’, http://www.channel4.com/news/tripoli-pipeline-attack-signals-endgame-for-gaddafi

(3) = Bloomberg Business Week 5 Jul 2011 ‘Qaddafi Running Out of Money, Fuel, Ex-Central Bank Head Says’, http://www.businessweek.com/news/2011-06-13/qaddafi-running-out-of-money-fuel-ex-central-bank-head-says.html

(4) = See (1) above

(5) = Guardian.co.uk 05 May 2011 ‘Libya faces fuel crisis as oil supplies dwindle’, http://www.guardian.co.uk/world/2011/may/05/libya-fuel-crisis-oil-supplies

(6) = Guardian 4 Jul 2011 ‘Gaddafi's son says western powers attacking Libya are 'legitimate targets'’,http://www.guardian.co.uk/world/2011/jul/04/gaddafi-son-western-powers-legitimate-targets

(7) = Independent 16 Jun 2011 ‘Gaddafi would agree to supervised election, says son’, http://www.independent.co.uk/news/world/africa/gaddafi-would-agree-to-supervised-election-says-son-2298234.html

Monday, December 27, 2010

The Truth about Tommy Sheridan? - a reply to the SSP's claims

Click this link to see the Scottish Socialist Party Youth Wing's animation on the break with Sheridan - it seems to have had more work put into it than their self-contradictory 'The Truth about Tommy Sheridan' website post, discussed below

The youth wing of the Scottish Socialist Party have a long, rambling, self-contradictory diatribe against Tommy Sheridan and anyone who supports him as being supposedly “misogynists” and “patriarchs” and about how SSP members’ testimony has been completely vindicated, despite all the claims they made about Gail Sheridan lying and 6 of the 12 allegations many of them made against Tommy were thrown out of court. It's titled 'The Truth about Tommy Sheridan'.

Below I’ve responded to some of the main points made in it (the parts in italics). For sources for the claims I make in response to them (parts in normal text) see my previous blog post

In court some former SSP members said that Tommy was partly a victim of the faction fighting around 50/50 -- a proposal to make sure women made up half of the party’s candidates for election. The idea was to try and tackle the obstacles put up to women’s participation in politics by institutionalised sexism, by actively ensuring that women got to be SSP candidates. It was an idea which the majority of the party supported, but drove the old fashioned sexist men bananas, and some began to resent the active role that women were taking in the leadership and public profile of the party. But the reality is that during the crucial votes on 50/50 within the SSP, Tommy was on the SAME side as Rosie, Frances and Carolyn, who were in favour of the progressive move.

So in other words, by backing making half the candidates women, Sheridan proved he wasn’t a misogynist at all – yet you go on to claim he is one

Whilst those of us who are still in the SSP now decided to come to the May 28th meeting with a strategy of being completely reasonable and not losing our heads

Is that what you call claiming that going to a swinger’s club with other consenting adults (sleazy if he did it but no-one's business but his and theirs and his wife's) equals having sex with prostitutes and trafficked sex slaves? I’d hate to see you when you’re losing your heads then

We’ve since learned that when George McNeilage, upset and angered by Tommy’s defaming of honest socialists as “scabs” for refusing to lie for him, decided to sell the tape he’d made of Tommy confessing to being an odious wee troll and a lying scrota

That tape doesn’t even show the face of the speaker, has repeated and unexplained long gaps in it and you’re telling us the £200,000 McNeilage took for it had nothing to do with it? I doubt it.

Apart from not being keen on women, the other thing that was distinctive about Solidarity was being really really really keen on Tommy Sheridan. It was a political party composed of people who were betting their future careers on Tommy being re-elected to Parliament. They went on to reach the stunning electoral success of managing to not re-elect Tommy - but electing Ruth Black as a Glasgow City Councillor

Excuse me? Solidarity don’t like women, but give a woman the candidacy in a winnable council seat?
Or are you trying to claim Ruth’s a man? You’re tying yourself in knots here.

The fact remains however that we’re still here and still recruiting, with the knowledge that we did the right thing and that the truth is still the truth. That’s the difference between us and the confused bunch of losers who attempted a wrecking job on the SSP.

So if everything SSP members have testified in court to is true, how is it that Tommy not only won the defamation case, but even in the perjury trial all the allegations against Gail and 6 of the 12 allegations against Tommy were dropped – many of those allegations having been supported by SSP witnesses?

The votes they have received have dwindled (from their greatest height of not getting Tommy elected). Sadly, with the split in the Scottish Socialist Party and the unfortunate trashing of the Party’s reputation in all of the papers (with the charge being led by Tommy), the SSP’s votes have suffered badly too.

Hilarious spin there. Colin Fox, your party leader, only got 319 votes in the General Election , because he couldn’t even organise getting leaflets printed correctly and in time. Even I got more than twice that as an Independent – and Sheridan got significantly more. Sheridan was the only SSP or Solidarity candidate to come very close to being re-elected in the last Scottish Parliament election – none of the remaining SSP candidates even came close.


After Solidarity failed in its number one mission in 2007, it began to slowly disintegrate, because the only thing that had bound such a disparate group of people together was that Tommy Sheridan was an electoral asset who gave them all reason to live. Their numbers dwindled, their website is pish, and their only elected representative is now a Labour councillor under investigation for corruption

Strange you don’t say how many councillors the SSP have since the “United Left” decided to jump at the chance of getting rid of the person who got the left in Scotland to stop squabbling long enough to form a single party and won them 6 seats in the Scottish Parliament

Take feminism and women’s rights seriously and never let any fuckwit misogynist attempt to ‘put you in your place’. It’s not enough to say that you’re for equality for women. You have to consider the myriad ways in which patriarchy manifests itself, particularly within left-wing organisations -- what myths are we perpetuating within ourselves that patriarchy creates in wider society? The response of some “socialists” to Tommy’s behaviour shows just how powerful stereotypes like the jealous witch, desperate for money and power, are in even among the left. Tommy and his supporters were never afraid to use the most sexist language about the women who disagreed with them, calling them bitches, cunts, witches and whores.

Well I’ve been to Solidarity meetings and never heard any of those words used about any woman at them. I’ve also heard Rosie Kane imply, without any evidence or reason to think it, that Sheridan had sex with prostitutes including trafficked sex slaves, rather than consensual sex (you make a similar implication yourself).

That seems more like political opportunism than principle to me. You seem to have a stereotype of all male politicians as oppressive patriarchs – which is misandry (irrational hatred of men) and just as bad as misogyny - and I suspect you had it long before any of this happened.

Alan McCombes is the one of the few anti-Sheridan witnesses whose testimony I’d trust at all – and no, not because he’s a man, before you put that through your misandrist glasses , but because he was such a close ally of Sheridan for so long.

Sunday, December 26, 2010

Selective Trial for Perjury - The Trial of Tommy Sheridan

photo: Murdo MacLeod, Guardian

Many people are now gloating over the conviction of Tommy Sheridan on perjury charges. There are a fair number of questions to be asked about that trial though. The first, as asked by a Scottish QC, is why it was Sheridan who was on trial and not those who testified against him in his previous defamation case against the News of the World, which he won. The answer, as the QC points out, is that it’s about placating the News of the World, who are part of Murdoch’s media empire which he uses to buy political influence (1). The fact that most police officers favour the establishment and were annoyed at having to police sit down protests against Trident at Faslane probably has something to do with it as well.

The vindictive nature of the police campaign against the Sheridans was shown by their attempt to charge airline hostess Gail Sheridan for having a handful of miniature drinks in her house – charges which the Procurator fiscal threw out because they were so trivial; their raids on the Sheridans’ house and their attempts to intimidate Gail Sheridan by asking her who had trained here in “terrorist” or “IRA techniques” (2).

Detective Stuart Harkness said to Gail SheridanGail, I must ask you at this time who has schooled you and asked you to focus on one point of the wall. I have interviewed people under the Terrorism Act and that is the kind of activity ... it’s recognised by the IRA, focus on the table, focus on the wall. Who has trained you? It’s a PIRA or IRA technique.” (3).

Bringing perjury charges is also extremely rare, even when it’s certain a witness or defendant has lied, as Ian Hamilton QC and many other lawyers have pointed out. The last perjury trial arising from a civil action in Scotland was over a decade ago. (4) – (5).

All the perjury charges against Gail Sheridan and six of the twelve allegations of perjury against Tommy were dropped during the trial (6) – (8). Does that mean we’ll see perjury charges against all the witnesses that testified in court that either Sheridan was guilty of those charges, including Andy Coulson, the former News of the World Editor (during the period of phone hacking by that paper) and now spin merchant for David Cameron, Andy Coulson? (9) – (10) If not, why not?

Another question is how much we can trust the word of many prosecution witnesses since we know from the testimony of prosecution witness George McNeilage that he accepted £200,000 from the newspaper for his dubious video – and that he had been convicted of burglary when he was 16 and again when he was 20 (11).

Anvar Khan testified that the News of the World and the publishers of a book she wrote (Black and White publishers, with business links to the News of the World) offered her money to lie about having ‘drunken sex’ with Sheridan and offered her more if she’d help entrap Sheridan in a phone conversation (she agreed to the former but refused the latter) (12).

So it’s extremely likely that the News of the World have bribed some other witnesses too.

If Sheridan did try to get his colleagues to lie in court, he was very seriously in the wrong, but there has been far too much News of the World money washing around on the one hand  - and far too many political rivals looking for a way to bring him down on the other - for it to be certain that he did.

Even if Sheridan really is guilty of the remaining charges of perjury he was convicted of I’d still take his side against the News of the World and much of the rest of the media – e.g the Sunday Mail with it’s ‘Shamed politican rallies supporters headline’. The reason is that Sheridan at worst lied by claiming he had had concensual sex when he had (though if he did and then tried to make colleagues lie in court about it that’s much worse)..

There were no ‘Shamed politician’ or ‘disgraced politician’ headlines in any of these newspapers after Tony Blair and half his cabinet lied repeatedly to the entire country and soldiers that they sent (many to their deaths) to a war that didn’t need to be fought against a country that posed no threat to them, helping Bush get enough domestic support for a war that has led to hundreds of thousands of un-necessary deaths.

Tommy Sheridan never broke an election pledge to anyone. Never promised not to cut the Educational Maintenance Allowance, then did it anyway, like David Cameron (who also, along with most of his party, voted to go to war on Iraq), nor broke a key election pledge on tuition fees, like Nick Clegg.

Instead Tommy Sheridan, while in opposition, not government, got warrant sales of the possessions of the poorest, abolished (13).

Four of the five former Scottish Socialist MSPs who were elected along with Sheridan based on his popularity and his achievement of getting the feuding left wing factions to form a single party turned against him, claiming he has done far more to damage the cause of socialism than to promote it. They were part of the ironically named “United Left” faction within the SSP, beginning factionalism again almost the moment a single party was formed . They should face facts. They would never have been elected at all if it hadn’t been for Sheridan and there would never have been a united SSP for long enough for them to be elected if it wasn’t for Sheridan. They all lost their seats when they stabbed him in the back and Sheridan was the only one of them that came close to winning a seat in the last Scottish Parliament elections.


They may well have turned on him mainly because they were jealous of his high profile in the media and leapt on the News of the World allegations as a club to beat him with. Former SSP MSP Rosie Kane went on to imply that Sheridan, accused of lying about having a consensual threesome in a ‘swingers club’, had had sex with trafficked sex slaves, or else that if he had been to a swingers club that that was equivalent to having sex with sex slaves. According to one blog (one which took her side, not Sheridan’s) she said in court that “It was disgusting. Tommy, it was traumatic. I was working with women who had been caught up in a trafficked situation. This flew in the face of everything that we stood for…” (14). I can understand her viewpoint and even see how a swinger's club might be used as a legitimate seeming front for a brothel, but she had no evidence that was the case, nor are the two things comparable.

Granted, if there was any even partial truth in the allegations made against him Sheridan would have been far wiser to ignore them or dismiss them rather than take a defamation action .

However Colin Fox, Rosie Kane, Caroline Leckie and the rest were most likely determined to use the allegations to take the leadership from Sheridan. This may have been one of the reasons he went to court in the first place, along with fears for his marriage and the fact that many of the claims made by the newspaper were clearly false (and found to be false in both the defamation case and in his perjury trial, in which he was found not guilty on the majority of the charges, though guilty of a minority of them).

No doubt Sheridan is far from perfect, but then that’s true of everyone. If asked to choose between someone who had an affair or lied about having sex, or politicians who lie to start a war that kills hundreds of thousands, I’ll choose the one with the sex scandal every time. Anyone who thinks sex scandals are more important than getting people killed has their priorities very wrong. If he was conclusively proven guilty of trying to make colleagues perjure themselves, that would be far more serious.


(1) = The Firm 23 Dec 2010 ‘Her Majesty’s Advocate against The Sheridans - Online Exclusive by Ian Hamilton QC’,
http://www.firmmagazine.com/features/851/Her_Majesty%E2%80%99s_Advocate_against_The_Sheridans_-.html

(2) = Herald 22 Mar 2008 ‘'No charges' for Gail Sheridan over drink miniatures’, http://www.heraldscotland.com/no-charges-for-gail-sheridan-over-drink-miniatures-1.877085

(3) = Herald 03 Dec 2010 ‘Crown drops more Sheridan perjury charges’, http://www.heraldscotland.com/mobile/news/crime-courts/crown-drops-more-sheridan-perjury-charges-1.1072224

(4) = See (1) above

(5) = BBC News 23 Dec 2010 ‘Should Sheridan's perjury trial have been prosecuted?’,http://www.bbc.co.uk/news/uk-scotland-12068925

(6) = Guardian.co.uk 24 Nov 2010 ‘Tommy Sheridan trial: prosecution drops four perjury charges’,http://www.guardian.co.uk/politics/2010/nov/25/tommy-sheridan-trial-perjury-charges

(7) = BBC News 17 Dec 2010 ‘Gail Sheridan cleared of perjury charges’, http://www.bbc.co.uk/news/uk-scotland-glasgow-west-12020014

(8) = BBC News 20 Dec 2010 ‘Six perjury allegations against Tommy Sheridan dropped’,http://www.bbc.co.uk/news/uk-scotland-glasgow-west-12040484

(9) = guardian.co.uk 14 Oct 2010 ‘Andy Coulson called as witness in Tommy Sheridan perjury trial’, http://www.guardian.co.uk/uk/2010/oct/14/andy-coulson-tommy-sheridan-trial

(10) = guardian.co.uk 1 Sep 2010 ‘Andy Coulson discussed phone hacking at News of the World, report claims’,http://www.guardian.co.uk/media/2010/sep/01/andy-coulson-phone-hacking-allegations

(11) = Herald (Glasgow) 9 Nov 2010 ‘Witness paid to go on holiday by newspaper’,http://www.heraldscotland.com/news/crime-courts/witness-paid-to-go-on-holiday-by-newspaper-1.1066879

(12) = guardian.co.uk 29 Oct 2010 ‘Tommy Sheridan trial: columnist admits lying over sex claims’,http://www.guardian.co.uk/politics/2010/oct/29/tommy-sheridan-trial-sex-claims

(13) = BBC News 6 Dec 2000 ‘MSPs abolish warrant sales’,http://news.bbc.co.uk/1/hi/scotland/1058426.stm

(14) = The Campaign for Human Rights at Glasgow Uni 16 Oct 2010 ‘Tommy Sheridan case produces a ‘new star’, former MSP Rosie Kane easily defeats Sheridan in mano-a-mano legal mental combat, Sheridan floundering’,http://glasgowunihumanrights.blogspot.com/2010/10/tommy-sheridan-case-produces-new-star.html

Friday, August 13, 2010

Iraq may be a ‘Land of Opportunity’ for some, but of death, violence and hunger for many others

Baghdad in Iraq - a land of opportunity? and if so, for who?

John Rentoul has risen to new heights of absurdity in his attempts to present the Iraq war as a success, by using a comment article in The Times newspaper by Jeffrey Archer as a source for a claim that Iraq is now a wonderful place to live with a vibrant economy. Archer was found guilty of perjury (i.e lying to a court) and of obstructing the course of justice – and jailed for it, while Blair got off with lying to an entire country by being Prime Minister (1) – (2).

Rentoul’s blog post has the heading “Iraq – Land of Opportunity” while Archer’s comment article is headed “wake up you Brits, make a fortune in Iraq’ and claims that Baghdad is now “a boom town, not a bomb site” on the basis that there are now “few suicide bombings” , although he admits “the most recent exploded the day after I left”.

One commenter on Rentoul’s blog quipped “don’t tell me, it goes boom, boom, boom”.


Sectarian killings and terrorism continue in Iraq and Afghanistan

Iraqis help a survivor of a bombing in June this year - bombings and sectarian killings have continued this month (photo taken by Nabil Al-jurani of AP)

Unfortunately that joke isn’t too far from the truth. The number of sectarian killings, car bombings and suicide bombings have certainly fallen compared to say 2005 or 2006, but they continue and remain much worse than they were in the 90s or 2001-2002 – and so a long, long way from a vindication of the decision to invade Iraq.

Members of the Awakening militias, who were persuaded to fight for the government when the American government was supplying their wages, have begun to be recruited to fight for Al Qa’ida, which is now offering higher wages, something made easier by the US government ending funding of the militias’ wages last year (3) – (4).

The US and EU governments have either been blinded to the connection between unemployment and poverty and sectarian killings, due to their adherence to the theory that the free market creates democracy – or else have failed to care about the connection.

In Iraq and Afghanistan (as in the former Yugoslavia crime in the 1990s) crime is now the only employment that offers the chance to make enough to feed families for large numbers of people. Sectarianism provides a justification for this war economy. If Sunnis and Shia are painted as enemies who threaten each other then a Sunni killing a shia and taking his money can claim to be defending his own people rather than committing a crime against another Iraqi. Similarly one community can drive another out of their homes and take them for themselves and call it ‘self-defence’ or warfare; or Shia kidnappers can take a Sunni hostage, get a ransom and then kill them anyway to eliminate the risk of being identified, trying to justify it in terms of sectarian warfare (5) – (6).

The murder of Christian aid workers in Afghanistan, which some Taliban claimed responsibility for, while others denounced it, is another example of religion, ethnicity and ideology being used to justify theft and murder in a country where surviving any other way has become impossible for many of it’s people. The murderers were almost certainly ‘thieves’ as the Afghan police say they are, while also seeing themselves as Taliban, even if many Taliban leaders disown them. The theory that the aid workers were trying to convert Muslims to Christianity is the excuse the bandits need to claim to be defending their people rather than just murdering defenceless people. Similar things happened with splinter groups from Al Sadr’s Madhi army in Iraq (7).


Money to be made for some, but still less food for many

Iraqis prepare rice. Food rations have been cut in half repeatedly even compared to those provided under Saddam and sanctions and are now around one eighth of those provided before the invasion. Over $8 billion of Iraqi money released by the UN to the US led Coalition remains unaccounted for while many Iraqis go hungry on insufficient rations ( Photo Saba Arar of UNICEF)

Lord Archer is probably right that there’s plenty of money to be made in Iraq too. That doesn’t mean the majority of Iraqis are benefiting though. There was plenty to be made for foreign companies, businessmen and contractors even at the height of the insurgency and occupation, both from Iraqi oil revenues and from the Coalition Provisional Authority’s generosity with Iraqi money.

Under Bush’s ‘Governor of Iraq’ Paul Bremer, described by UN envoy to Iraq Lakhdar Brahimi as “the new dictator of Iraq” over $8 billion of Iraqi money was handed out to various private contractors working for the “Coalition Provisional Authority”. Much of it has never been accounted for (8) – (13).

When challenged about it by congress Bremer simply replied that it was Iraqi money, not American taxpayers’ money (the clear implication being that he could get off with handing it out to whoever he liked as the US congress couldn’t hold him to account for it – and with 50,000 US troops remaining in Iraq until December 2011 the Iraqi government can't either) (9).

A recent report  ‘by the US Special Investigator for Iraq Reconstruction says $8.7bn (£5.6bn) out of $9.1bn withdrawn between 2004 and 2007 from a special account set up by the UN Security Council is unaccounted for.’ (13).

This was money from the UN’s Oil for Food programme for Iraq. Bremer shouldn’t have been distributing a penny of it without the approval of a new Iraqi government.

Many Americans may be unaware of this aspect of fraud relating to the programme, as their media mostly focused on millions of dollars allegedly pocketed by some UN Officials rather than the billions vanished by Bremer’s CPA.

As far as can be determined none of the money Bremer disappeared went to Iraqis for food.

Meanwhile more Iraqis remain shorter of food, clean water, sewerage and electricity than under Saddam and sanctions.

In Iraq IMF policies imposed as conditions for debt reduction have included cuts in food price subsidies and provision of food rations to the poorest. By autumn 2007 more people relied on government rations for food than under Saddam and UN sanctions – and the amount and types of food provided to each person were reduced compared to the 1990s (14) – (15). Hundreds of people in Baghdad were scavenging in bins for food (16). Yet in December 2007 the Iraqi government cut food rations again on the stated grounds that the budget (much larger than under Saddam and sanctions in the 90s) couldn’t pay for them (17).

In theory the rations were to be replaced by cash payments of social security – but with rocketing food prices and Iraqi and US government corruption this has never been implemented and would be unlikely to allow Iraqis to afford enough food to eat (18) – (19).

In April 2010 the Iraqi government cut the range of foodstuffs in the rations by half again, citing food price rises and budgetary problems (again) as the cause (20).

Many refugees inside Iraq – ‘internally displaced people’ forced out of their homes by coalition offensives and sectarian killings by other Iraqis – can’t get food rations at all as they are no longer at the address they were listed at for rations but in tents elsewhere (21) – (22).

The number of Iraqis unable to afford enough food is still on the increase and around a fifth of Iraqis are unemployed and the same proportion live below the poverty line (23).

Halliburton and it’s subsidiaries also made big profits by over-charging the US military in Iraq for oil and food among other things, in many cases in no-bid contracts (24) – (25). In this case the money was being stolen from American taxpayers, rather than Iraqis – but when it came to money for shoring up the levees in New Orleans to prevent the flooding or to helping the survivors after hurricane Katrina, private mercenary companies like Blackwater once again got far more money than people who were really in need.


Using WMD on Iraqis to prevent Saddam using them on them

A girl born in Fallujah with no left hand. Birth defects in the city have rocketed since the Coalition assaults in 2004 which used white phosphorus and depleted uranium shells

The theory that the invasion was protecting Iraqis from Saddam using chemical weapons on them, as he did against the Kurds in the 80s, has also been revealed as empty propaganda. When Saddam was gassing the Kurds the US and British governments were funding and arming him. Twenty years later they claimed they were going to prevent Saddam ever using WMD on his own people again. Unfortunately Coalition forces during the occupation used both cluster bombs (which kill as many civilians as land mines) and chemical weapons such as  white phosphorus and depleted uranium shells in the middle of towns and cities. In Fallujah, which suffered major coalition offensives on it in April and November 2004, there are now extremely high levels of cancers and birth defects among children; though clusters of leukaemia and birth defects were already high in many areas since DU was used extensively by coalition forces in the 1991 war (26) – (28).


Blair’s self-deluding propaganda from Iraq to Iran

I posted a shorter version of this post as a comment on Rentoul’s blog, but he moderated it out of existence (though it’s possible this could have been due to fears of legal action from Lord Archer). It seems that reality is still not merely a foreign country but an alien planet or universe for those who have blind faith in the Iraq war and Saint Anthony.

If Blair and his supporters were willing to apologise for peddling deliberate distortions of intelligence analyses to start a war that was bound to kill far more people than it could possibly save – and if they weren’t pushing for another war, that might be old news.

Unfortunately since Blair left office he has continued to call for “action” to avert the “threat” from Iran ,for instance in speeches in the US and at his appearance at the Chilcot Inquiry

Blair and his propaganda remain far from the truth and potentially dangerous. I genuinely believe that Blair genuinely believes what he says, but that doesn’t make it the truth. In fact Blair has probably bought his own propaganda line because it’s preferable to the truth, which is that he created a disaster which is still killing people.

So there’s no option but to keep on repeating the facts about the continuing disaster in Iraq in the hope that it’ll stop it being repeated in Iran.


(1) = Eagle Eye 26 July 2010 ‘Iraq, land of opportunity’,http://blogs.independent.co.uk/2010/07/26/iraq-land-of-opportunity/

(2) = Times 26 July 2010 ‘Wake up, you Brits. Make a fortune in Iraq’,http://www.thetimes.co.uk/tto/opinion/article2658957.ece

(3) = guardian.co.uk 10 Aug 2010 ‘Fears of al–Qaida return in Iraq as US–backed fighters defect’,http://www.guardian.co.uk/world/2010/aug/10/al-qaida-sons-of-iraq

(4) = Guardian 02 Apr 2009 ‘Iraq disbands Sunni militia that helped defeat insurgents’,http://www.guardian.co.uk/world/2009/apr/02/iraq-sunni-militia-disbanded

(5) = Guardian 27 Jan 2007 ‘'If they pay we kill them anyway' - the kidnapper's story’,

http://www.guardian.co.uk/world/2007/jan/27/iraq-middleeast

(6) = Kaldor, Mary (1999) ‘New and Old Wars: Organized Violence in a Global Era’, Polity Press, 1999

(7) = Observer 08 Aug 2010 ‘British surgeon among 10 medics executed in Afghanistan’,http://www.guardian.co.uk/world/2010/aug/08/british-surgeon-karen-woo-afghanistan

(8) = Guardian 03 Jun 2004 ‘How honest broker was defeated - and with him hopes of credibility’, http://www.guardian.co.uk/world/2004/jun/03/iraq.jonathansteele

(9) = CNN 31 Jan 2005‘Audit: U.S. lost track of $9 billion in Iraq funds’, http://edition.cnn.com/2005/WORLD/meast/01/30/iraq.audit/

(10) = Guardian 07 July 2005 ‘So, Mr Bremer, where did all the money go?’http://www.guardian.co.uk/world/2005/jul/07/iraq.features11

(11) = ABC News 06 Feb 2007‘Waste in War: Where Did All the Iraq Reconstruction Money Go? : Congressional inquiry probes former Bush official's handling of billions ofdollars, http://www.abcnews.go.com/Politics/story?id=2852426&page=1

(12) = Guardian 08 Feb 2007 ‘How the US sent $12bn in cash to Iraq. And watched it vanish’http://www.guardian.co.uk/world/2007/feb/08/usa.iraq1

(13) = Independent 28 Jul 2010 ‘US unable to account for billions of Iraq oil money’,http://www.independent.co.uk/news/world/americas/us-unable-to-account-for-billions-of-iraq-oil-money-2036925.html

(14) = UNOCHA IRIN news service 02 Apr 2006, ‘IRAQ: Food prices rise after reduction of monthly rations’, http://www.irinnews.org/report.aspx?reportid=26250

(15)= UNOCHA IRIN news service 9 Sep 2007, ‘IRAQ: Food rationing system failing as Ramadan approaches’,http://www.irinnews.org/report.aspx?ReportID=74196  

(16) = UNOCHA IRIN news service 17 Oct 2007, ‘IRAQ: Hundreds forced to scavenge for food in garbage bins’,http://www.irinnews.org/report.aspx?ReportId=74829

(17) = UNOCHA IRIN news service 4 Dec 2007, ‘IRAQ: Government to cut items from its free food handouts’, http://www.irinnews.org/report.aspx?ReportID=75677

(18) = Allawi, Ali A. ‘The occupation of Iraq’ Yale UP, New Haven & London, 2007 (paperback edn) p 375-376, 430-431

(19) = IPS/ Ali al-Fadhily and Dahr Jamail 03 May 2008, ‘Corruption Eats Into Food Rations’,http://dahrjamailiraq.com/hard_news/archives/iraq/000795.php#more

(20) = UNoCHA IRIN news 01 Apr 2010 ‘IRAQ: State food aid package slashed’,http://www.irinnews.org/Report.aspx?ReportId=88646

(21) = Allawi, Ali A. ‘The occupation of Iraq’ Yale UP, New Haven & London, 2007 (paperback edn) Ch20 , p348-369 & 427

(22) = Refugees International 04 Oct 2007, ‘Iraq: Fix the Public Distribution System to meet needs of the displaced’,  http://refugeesinternational.org/content/article/detail/9971/

(23) = UNoCHA’s IRIN news 08 Nov 2009 ‘IRAQ: Food insecurity on the rise, says official’,http://www.irinnews.org/report.aspx?ReportId=86926
(24) = BBC News 13 Dec 2003 ‘Bush warns 'oil overcharge' firm’,http://news.bbc.co.uk/1/hi/business/3312015.stm
(25) = Halliburton Watch 14 Mar 2005 ‘Auditors find another $108 million in Halliburton overcharges’, http://www.halliburtonwatch.org/news/108million_overcharge.html - provides links to Pentagon audit of the contracts involved and the executive summary of it - http://www.halliburtonwatch.org/news/108million_overcharge.html

(26) = guardian.co.uk 13 Nov 2009 ‘Huge rise in birth defects in Falluja’,http://www.guardian.co.uk/world/2009/nov/13/falluja-cancer-children-birth-defects

(27) = Observer 14 Dec 2003 ‘Army shells pose cancer risk in Iraq’,http://www.guardian.co.uk/world/2003/dec/14/iraq.military

(28) = BBC News 16 Nov 2005 ‘US used white phosphorus in Iraq’,http://news.bbc.co.uk/1/hi/4440664.stm