Getting Bomb Trains Off Tracks

Stopping West Coast Tar Sands Oil Bomb Trains in Their Tracks

by Jack Eidt - CounterPunch

February 4, 2016

On February 4th and 5th, San Luis Obispo County will be deciding on a Phillips 66 plan to bring mile-long oil tanker trains into their Nipomo Mesa plant five days a week, each carrying 2.4 million gallons of toxic and volatile petroleum across California. So, why should the rest of us care? Well, the Delta 5 gave us one reason, protestors in Washington state who tied themselves to a 25-foot tripod to block a train carrying crude oil.
A runaway train carrying North Dakota crude oil 
derailed and exploded in the center of Lac-Megantic, 
Quebec, killing 47 people in July 2013, highlighting a 
dangerous trend in North America. Californians are 
speaking out against oil train expansion plans in San 
Luis Obispo, the East Bay, Sacramento, Bakersfield, 
and Los Angeles. Photo: Public Herald

Stopping these shipments of some of the dirtiest crude oil on earth from fouling our climate even further. But for the average person who isn’t blocking fossil fuel infrastructure, there is an even greater imperative: bomb trains.

Five times around North America in 2015 oil trains crashed causing massive explosions, spills of caustic crude into rivers, fires that burn out of control, and significant property damage. The list is daunting: May 2015 in Heimdal, North Dakota, six cars of a 109-car train exploded into flames with 60,000 gallons of oil spilled. In March, an oil train derailed near Gogoma, Ontario, with a fire that destroyed a bridge.

This only 23 miles from a February oil train accident where the fire burned for days. Evacuations and extreme explosions have become a game of Russian roulette, and first responders can only wonder where is next?

“The February 2014 crash in North Vandergrift, Pennsylvania, [attributed to a failure in newly-laid rails] fits into an alarming pattern across North America that helps explain the significant rise of derailments involving oil-hauling trains over the last three years, even as railroads are investing billions of dollars in improving the safety of their networks. A review of 31 crashes that have occurred on oil trains since 2013 puts track failure at the heart of the growing safety problem.” — Los Angeles Times

In March of 2015, near Galena, Illinois, 21 cars of a 105-car oil train derailed and burst into flames. And in February, a 109-car CSX oil train derailed and caught fire near Mount Carbon, West Virginia, leaking oil into the Kanawha River tributary, with a fire that burned for most of a week. In all of these accidents the tankers were retrofitted with protective shields to meet a higher safety standard than federal law requires, meaning the biggest problem in a world of problems was the flammable fracked oil shale or tar sands crude involved. Four more accidents happened in Tennessee, Montana and Wisconsin in 2015 where significant oil, fuel or corrosive chemicals were spilled, but without a major explosion.

The worst oil train accident by far happened July 5, 2013, with an unattended runaway train carrying fracked North Dakota Bakken shale oil, derailing and catching fire in the town of Lac-Megantic, Quebec. Forty-seven people were killed and thirty buildings burned. About 1.6 million gallons of oil was spilled.

Several things are clear here: the rail tanker cars, emergency response plans, braking equipment requirements, and railroad track maintenance are inadequate. And we must find cleaner, safer alternatives to these ecosystem-fouling, climate-disrupting extreme fossil fuels like tar sands and fracked oil shale.

Blast Zone Running Through Our Cities and Towns

The proposal includes 80-car trains, up to 1 ½ miles long, that leak their contents into the air, toxic sulfur dioxide and cancer-causing chemicals that increase health risks of heart and respiratory disease. The proposed rail route would bring oil trains through the environmentally-sensitive state water resource San Francisco Bay Delta and along California’s Central Coast.

Volatile and toxic crude would also begin moving through Los Angeles between the Inland Empire and Downtown Los Angeles, along a stretch of the L.A. River, a source of water and recreation undergoing a $1.3 billion makeover, passing homes, hospitals, and parks, through downtown where hipster apartments and sparkling office-and-shopping megaplexes are sprouting up. The trains would further pass through the Chatsworth/Northridge area already facing the largest fossil fuel gas leak blowout since the BP Deepwater Horizon.

Responding to pressure from activists, the Los Angeles City Council passed a unanimous resolution last September to oppose this project. They were not alone: six counties and 21 cities passed similar motions asking SLO to reject the project.

The entire route would put at risk more than 5 million people statewide within a one-mile evacuation area, called the Blast Zone.

A recent analysis by the Center for Biological Diversity found that 500,000 students in California attend schools within a half-mile of rail tracks used by oil trains, and more than another 500,000 are within a mile of the Blast Zone. In addition to the threat posed to California’s students, the report Crude Injustice on the Rails released last year by ForestEthics and Communities for a Better Environment, pointed out that in California the communities within the half-mile blast zones were also more likely to be low-income minority neighborhoods.

The cost of our oil addiction already disproportionately impacts these communities with toxic air quality, asthma and other maladies, noise, and the threat of accidents. Time for an intervention to heal this debilitating addiction now.

We Have Alternatives

We must reject regular bomb train accidents as a cost of business as usual in our fast-paced, technology-addled world. We can continue to retrofit our cities and towns to provide alternatives to gridlocked freeways, with accessible public transit, car-sharing and autonomous (self-driving) technologies, free-flowing bicycle throughways, and walkable neighborhoods. We can invest in the development of more efficient automobiles made of fiber composites, powered by solar and wind power or advanced biofuels.

Rather than sacrifice our railroads built for passengers and light cargo, not 100-car bomb trains bent on destabilizing our climate in the name of getting to work on time, we can look to the work of the visionaries, Mark Z. Jacobsen’s Solutions Project, Amory Lovins’ Rocky Mountain Institute, and Arjun Makhijani’s Carbon Free, Nuclear Free.

We can and will transition to an economy focused on efficiency, conservation, and renewable and clean sources of energy, but it has to happen now. And we must overcome the excesses of capitalism, where politicians like Mr. Obama and Mr. Brown, who spout concepts of energy sustainability can be bought with the power of dark money to push for more pipelines, oil trains, hydraulic fracking wells, holding fast to the addiction.

Presidential candidates like Bernie Sanders or Jill Stein have the ability to separate themselves from the oil lobby billions: the rest of them, not so much. Sacrifice zones like Porter Ranch and Wilmington, along with extreme droughts and Superstorms, as well as cancer-clusters and death by explosions, don’t have to be the cost of “doing business.”

Instead of bringing tar sands crude from the strip-mined boreal forests of Alberta, the Phillips 66 Santa Maria Refinery should transition their workers into providing sustainable energy for the 21st Century. Our communities and our planet demand a world with clean air and water, safe from exploding bomb trains.

Jack Eidt is publisher of WilderUtopia, and serves on the Steering Committee of SoCal 350 Climate Action, a Los Angeles affiliate of the international climate change organization 350.org.

More articles by:Jack Eidt

Squeezing Russia: Will Oil Price Arm-Twisting Bring Putin Around?

Russia Cries Dyadya (Uncle), Is Saudi Arabia Listening?

by Dalan McEndree  - Oilprice.com

In recent days, signs of a possible breakthrough in the year-long stand-off between Russia and Saudi Arabia on crude production strategy have emerged. Saudi Arabia, OPEC's dominant member, has long insisted OPEC (read Saudi Arabia) would not reduce output to balance supply and demand absent corresponding cuts from non-OPEC members (read Russia), while Russia has consistently insisted harsh climactic conditions prevent Russian producers from reducing output and in any case Russia insists it could withstand low prices as well as any other country.

January 27, however, Russia announced, in a roundabout way, its willingness to cut. According to Bloomberg, the Russian Energy Ministry issued a statement that "Energy Minister Alexander Novak and the heads of Russia's biggest oil companies discussed the possibility of working with OPEC." The article also reported that Deputy Prime Minister Yury Trutnev told President Vladimir Putin that:

"There was a series of meetings with other governments last week on the issue of oil prices during the World Economic Forum in Davos, Switzerland. Oil exporters are talking about coordination because the current price is "unacceptable" to justify spending on exploration and field development".

These Russian comments were not the only signs of potential movement in the past week. At a conference in Kuwait City, Iraq's Oil Minister Adel Abdul Mahdi stated that "Saudi Arabia and Russia, the world's biggest oil producers, are now more flexible about cooperating to cut output as crude prices have fallen to levels that hydrocarbon-rich nations didn't foresee.

Many observers, however, have been quick to dismiss the significance of these public statements. John Kilduff, founding partner of Again Capital, and frequent CNBC oil contributor, commented January 29 on CNBC that:

"This whole story line about there being a coordinated production cut plan is just rubbish").

More generally, as this quote from a recent Bloomberg article shows, observers believe simply both sides are committed to their current (over)production strategy:

"There's little sign the countries themselves are ready to reach an agreement despite the economic damage wrought by the lowest prices since 2003. Long-standing obstacles remain -- Saudi Arabia's desire to defend market share, Russia's inability to cut production in winter months -- and analysts say talk of a deal probably reflects the hope of producers in pain rather than the expectation of concrete action".

In fact, skeptical observers dismiss these statements' implications at their own peril. Both the Saudis and the Russians are serious, as both have powerful motivations to agree on measures to balance the market through production cuts, reduce crude inventories, and increase prices.

The real question, instead, is whether their interests are sufficiently congruent to agree to simultaneous moves to balance the market.

With Their Economic Situation Dire, Are the Russians Desperate?

Over the last several months, as crude prices have renewed their plunge and taken the Ruble with them, Russian economic prospects have deteriorated sharply. Even a cursory review of press reports reveals the intensity of the economic pain.

At the World Economic Forum in Davos last week, Alexei Kudrin, Russia's respected former Finance Minister, stated -or perhaps warned -

"We have two years in reserve [to overcome the economic crisis] when social sentiments will be stable. There are still social protests, they are growing, but they aren't bursting into something out of control".

Until recent weeks, the Russian government had some basis to harbor hope that GDP, after contracting ~3.5 percent in 2015, would return to growth within this two year window. As late as Q3 2015, the IMF estimated that in 2016, GDP would grow, if only anemically at below 1 percent.

Recent crude price action, however, has dashed such hopes and instead has raised the prospect of a deeper and longer recession. In a "stress" test it conducted in November, the Russian Central Bank estimated that with Ural crude prices below $40 per barrel between 2016-2018, the Russian economy would contract five percent in 2016, inflation would run at 7-to-9 percent, and that these conditions "would also raise risks to inflation and financial stability.

Central Bank efforts to stabilize the Ruble and contain inflation are one reason the "stress" test results may prove prescient. The plunge in crude prices is preventing the Central Bank from easing monetary policy to stimulate the economy. Friday, January 29, it announced that it would keep its benchmark interest rate at 11 percent, to support the Ruble (which fell as low as ~R82.5/US$ last week before recovering to ~RUB75.5/US$ on January 29) and contain inflation. In its announcement, it noted that its next move could be to raise rather than lower the benchmark rate, were inflationary pressures to increase.

Facing crude prices below $30 per barrel, Russian Finance Minister Anton Siluanov in a January 16 television interview said Russia now faced a RUB 1.5 trillion budget deficit ($38.6 billion at the time of the interview) and that this would force the government to rework the budget it approved in December, which was based on $50 Ural crude prices. Reworking, according to Siluanov, will entail cutting RUB 500 million in spending (from which the military, national security, and agriculture would be exempted) and finding RUB 1 trillion in additional revenue.

Finding this RUB 1 trillion confronts the Russian government with unpalatable choices. Russia's sovereign wealth/reserve funds have been proposed as sources—but in September, Siluanov warned that they would be depleted in sixteen months.

The Russian government is also contemplating asset sales (including part of its stake in Rosneft and in VTB, a major bank), but such sales would provide one-time boosts to revenue and in any case would take time to organize. Borrowing is a possibility, since Russia's sovereign debt is low, but the Russian government can't access U.S. and European capital markets, closed to it due to U.S. and EU sanctions related to the conflict over Ukraine).

The Russian energy industry is also a target - and potentially a lucrative one, given the structure of Russian taxes on the industry. In 2015's first three quarters, for example, low crude prices decreased the revenues the Russian government collected in export customs duties from Rosneft, Russia's largest producer, by RUB 520 billion (RUB 1058 billion to RUB 738 billion), while taxes other than income taxes increased only RUB 80 billion, from RUB 919 billion to RUB 1009 billion).

It is therefore not surprising that in September, the Russian Finance Ministry attempted to increase the mineral extraction tax. Industry opposition and opposition from other Russian ministries—citing the negative impact on investment and output - forced it to back down (Venezuela is an example, admittedly extreme, of what happens when government raids on industry revenues to fund current operations squeezes investment). It proposed instead to slow down the planned decrease in crude export duty rate (from 42 percent to 36 percent. Also under consideration is a windfall profits tax on Russian energy exporters benefitting from the Ruble's depreciation.

Deteriorating Energy Industry Conditions

The situation of Russian energy producers is also difficult. The Telegraph (UK) in early January quoted Russia's deputy finance minister, Maxim Oreshkin, as telling TASS earlier this month that low crude prices could lead to "hard and fast closures in coming months." The article also said noted that in the key Soviet-era fields in western Siberia, the annual rate of depletion is averaging 8 percent to 11 percent, while new projects are being curtailed.

According to the Telegraph, Transneft, the Russian crude and product pipeline monopoly, estimated that Russian crude exports could decrease in 2016 by some 460,000 barrels per day, based on producer applications for pipeline capacity.

In an interview with TASS, the Russian news agency last week, Lukoil Vice President Leonid Fedun commented that Lukoil was unlikely to produce the one hundred million tons it produced in 2015. He also said that it made more economic sense to sell one barrel of oil for $50 than two barrels for $30.

Gazprom, Russia's natural gas giant, shows signs of stress. In recent weeks, it has instituted a series of cuts in investments. January 11, Reuters reported Gazprom cancelled one tender in December and three tenders in January for work on the construction of the Ukhta-Torzhok pipeline, a domestic key component of pipeline system which will transport natural gas directly to Germany through the Nord Stream II pipeline. According to Reuters, Gazprom Neft (of which Gazprom is the majority shareholder) recently terminated negotiations to acquire a 49 percent stake in Vietnam's Binh Son Refining and Petrochemical, a subsidiary of Vietnam's state-owned PetroVietnam.

A January 15 Reuters article quoted "sources close to Gazrpom" as saying that Chinese economic problems and low energy prices have reduced the volume of natural gas Gazprom expects to export to China via the Power of Siberia pipeline - the project on which Gazprom has bet its future - when it is completed. Given the already questionable economics of the Power of Siberia project, reduced volumes will intensify doubts about the project's financial viability and future (Putin Is Taking A Big Risk With China Gas Deals).

Overleveraged, Rosneft's Pain is Particularly Acute

The pain for Rosneft, the company which the Russian government hoped would gain the size necessary to compete on equal terms with Western oil majors, is particularly acute. As part of its effort to gain scale, the company in 2013 took on massive debt - $40 billion according to Reuters - to finance its acquisition of Russian competitor TNK-BP for $55 billion.

To help pay down debt, Rosneft, also in 2013, concluded an agreement with Chinese National Petroleum Corporation to supply 400 million metric tons of crude over twenty five years, under which Rosneft was entitled to receive prepayment equal to 30 percent of the contract's value (Rosneft received RUB 1027 billion in 2015 Q3).

At the end of Q3, Rosneft's net debt stood at $24 billion. Yet, Alexey Bulgakov, a fixed income analyst at Sberbank CIB estimates that Rosneft may already have accessed the maximum amount of cash it can under the deal, given the decline in price from ~$100-plus per barrel in 2013 to ~$30 per barrel now and the terms of the agreement. And, should crude prices remain at current levels, Rosneft likely cannot generate the cash to cover its investment, interest, and debt repayment obligations.

Russian government officials and energy producers argue that a depreciating Ruble has attenuated the impact of lower crude prices, since each US$ generates more Rubles, which is important given that the bulk of their expenses are in Rubles. This, however, isn't the only impact of a weak Ruble. It can also cause inflation, and this has been the case in Russia. The following table, from Rosneft's quarterly Management's Discussion and Analysis reports, provides the Russian Central Bank data for cumulative inflation over 2015's first three quarters:

IMG URL: http://cdn.oilprice.com/images/tinymce/2016/DyadyaA.jpg

For Rosneft, inflation has contributed to increased costs in all but one expense category compared to 2014's corresponding quarter (percentage change in red font in column 2 in the table below) and, because revenues declined in 2015, increased the ratio of that cost to revenue compared to the corresponding 2014 period (last two columns).

These two effects caused operating income through Q3 2015 to fall to RUB 455 billion from RUB 539 billion in 2014 (and, of course, in US$ terms, the value of the operating income decreased even more, since the respective average exchange rates were RUB 59.28/US$ and RUB 35.59/US$ in 2015 and 2014). In addition, if not for the 41.3 percent decrease in export customs duty—RUB 520 billion in absolute terms—operating income would have been negative RUB 65 billion through 3Q 2015 (RUB 455 billion minus RUB 520 billion).

IMG URL: http://cdn.oilprice.com/images/tinymce/2016/Copy%20of%20DyadyaB.jpg

Reduced revenues and increased costs in 2015's first three quarters also reduced the amount of cash Rosneft generated to cover investment, dividends, and net finance expense (which includes interest paid, interest received, and operations with derivative financial instruments). The following table shows that the cash remaining after Rosneft's spending on net finance expense, investment, and dividends, after adding non-cash depreciation, depletion, and amortization expense back into operating income, declined significantly through three, six, and nine months of 2015 compared to 2014 in Ruble terms and, of course, even more in US$ terms given Ruble depreciation (RUB 59.28/US$ in 2015 versus RUB 35.59/US$ in 2014):

IMG Url: https://oilprice.com/images/tinymce/2016/DyadyaC.jpg

Given that average crude prices in Q4 2015 were substantially lower than in Q3 and that they likely will even lower in Q1 2016, Rosneft's financial operating results should also deteriorate substantially in these quarters. The following table projects Rosneft's revenues in Rubles in Q4 2015 and Q1 2016 using the Ruble's Q4 average US$ exchange rate and a guesstimate of the Ruble's Q1 US$ average exchange rate; an estimate of sales in volume terms, assuming output in 4Q 2015 continued to outpace 2014 levels by 2 percent and stayed constant in Q1 2016; and guesstimates of crude prices, taking into account Ural crude's discount to Brent, Rosneft's price competition in Europe with Saudi Arabia, and the impact on Rosneft prices in Europe and Asia from a prepayment agreement with Transneft that lowered its realized price per barrel (in Q1, Q2, and Q3, a reduction of RUB 200, RUB 40, and RUB 180 in Europe and RUB 170, RUB 350, and RUB 190 Rubles in Asia).

IMG URL: http://cdn.oilprice.com/images/tinymce/2016/DyadyaD.jpg

In the following table, 4Q costs are estimated using 4Q 2014 figures, multiplied by the percentage increase in costs in Q4 2015 from Q3 2015 (except for taxes and export custom's duty, which are the average quarterly cost in 2015).

IMG URL: http://cdn.oilprice.com/images/tinymce/2016/DyadyaE.jpg

This rough guesstimate of Rosneft's 4Q 2015 and 1Q 2016 performance suggests that the company will not generate sufficient cash to fund investment, dividends, and interest, and pay down debt.

From the Saudi Point of View

The Saudis and their Gulf Arab allies also have compelling reasons to consider production cuts to balance the global crude market and raise prices. They depend on revenues from crude and crude product exports as much as if not more so than the Russian government to fund government spending. Like the Russian government, they face serious domestic and international challenges—including wars and domestic tensions - that they counted on the export of crude and crude products to fund.

As a result of lost revenues and deteriorating budget numbers, the government are drawing on foreign currency and sovereign wealth resources, seeking to cut spending, including in such politically sensitive areas as subsidies for individuals and businesses, and to defer or cancel important investment projects (the UAE in recent days suspended the tender process for stage two of a project to build a 1,350 mile railroad from Kuwait the Indian Ocean along the Persian Gulf).

To raise revenue, they are introducing new taxes (such as on unoccupied land in Saudi cities) and contemplating asset sales (or which the Saudi plan to sell shares in Saudi Aramco and/or its downstream subsidiaries is a prime example).

OPEC dynamics are another important consideration. Other OPEC members - Venezuela, Algeria, Nigeria, Angola and Libya - repeatedly have called for output to be cut. In response, the Saudis have argued that OPEC cuts would be ineffective in the absence of simultaneous cuts from non-OPEC countries members. Were the Saudis and their Gulf Arab allies to reject a sincere Russian commitment to cut production, their credibility and authority within OPEC would suffer perhaps irreparable damage.

Also, for the Saudis, the plans to sell shares in Saudi Aramco and/or its downstream operations could play an important role. The price investors will be willing to pay for shares in these entities will depend on the value they place on the entities, and this value will depend on their assessment of the entities' management, strategy, and prospects. If, for example, potential investors believe that management, at the behest of the Saudi government, will sacrifice growth, profits, and dividends to achieve Saudi foreign policy goals through low prices, investors' interest might be tepid at best.

A Narrow Window of Opportunity for Russia for Coordinated Cuts

The Russians potentially enter any discussions with a weaker hand. The Saudis and their Gulf Arab allies probably can withstand lower prices longer than the Russians. Russia lacks the financial resources the Saudis and their Gulf Arab allies have at their disposal.

Their sovereign wealth funds and foreign currency reserves in absolute and per capita terms exceed Russia's, the value of their government owned energy assets are greater than the value of the Russian government's energy assets (which are already partially privatized), and Saudi Arabia and its Gulf Arab allies have access to international capital markets, whereas the Russian government, because of U.S. and EU sanctions, does not.

They also have the means to pressure Russia. The Saudis have spare capacity (according to the IEA have some '1.5~2.0 million barrels per day which they can bring on line within three months), while the Russians lack spare capacity. Finally, Russia's major energy companies report quarterly results, whereas with a few exceptions, Saudi and Gulf Arab energy companies do not. Thus, the Saudis have access to critical Russian microeconomic financial data, whereas the Russians do not have such access to Saudi and Gulf Arab data.

Possibly, if the Russian government believes its hand is weaker, it might consider it advisable to reach agreement expeditiously. After all, the Russian government should take into account that if Russian data during the first quarter shows declines in output and exports, as comments from Russian government and company officials cited above suggest might happen, and Q1 2015 financial reports show intensifying financial pressures on Russian energy companies, Saudis and their Gulf Arab allies might be tempted to decide to maintain pressure on prices and force Russia to absorb the cuts necessary to balance the global crude markets.

Pentagon Budget Declares World War ZEE

Pentagon budget directed toward war with Russia and China

by Bill Van Auken  - WSWS

3 February 2016

Presenting a preview of the Pentagon’s $583 billion budget, US Defense Secretary Ashton Carter stressed that the US military is shifting its focus toward war against both Russia and China even as it escalates ongoing interventions in the Middle East.

Speaking before the Economic Club of Washington Tuesday morning, Carter said the gargantuan budget for fiscal year 2017, which is to be presented next week, had been prepared to confront what he called “a new strategic era.” The thrust of Carter’s speech, delivered in the dry cadence of a longtime technocrat in the field of mass destruction, was that US imperialism is preparing for a new world war.

The biggest single change in the budget is the quadrupling of funding for the so-called European Reassurance Initiative, which is being increased from $789 million to $3.4 billion.

This initiative was introduced by the Obama administration in the wake of the crisis provoked in Ukraine two years ago, when the US and Germany orchestrated a coup spearheaded by neo-fascist forces that overthrew the Moscow-aligned government of President Viktor Yanukovych.

In September 2014, Obama, speaking in the Estonian capital, Tallinn, committed the US to the military defense of the three former Soviet Baltic republics, vowing that this pledge was “unwavering” and “eternal” and would include “American boots on the ground.”

According to a report published Tuesday in the New York Times, the increased funding will be used to ensure that the US and NATO maintain a full armored combat brigade at all times on Russia’s western border, along with the forward deployment of weapons and military hardware in Estonia, Latvia and Lithuania, as well as in other eastern European countries such as Hungary and Romania.

The Times quoted a Pentagon official as saying that what was being prepared was a “heel to toe” rotational troop presence in the region, meaning that combat units would be continuously deployed. This provocative and reckless tactic is designed to evade a 1997 agreement with Moscow known as the NATO-Russia Founding Act, in which both sides pledged not to station large numbers of troops on each other’s borders.

The US, Carter insisted, must have the capacity to counter Russia “theater-wide,” meaning it must maintain forces capable of attacking Russia wherever it sees fit.

The money for this anti-Russian escalation is to be taken from the Overseas Contingency Operations account, the war-fighting fund that has paid for US wars and occupations in Iraq and Afghanistan. While from an accounting standpoint this is meant to circumvent spending caps on the Pentagon’s regular budget, it also signals that what is involved is the active preparation for a military confrontation between the world’s two largest nuclear powers.

Included in the budget proposal are plans for a substantial buildup of US imperialism’s nuclear war arsenal. It calls for the allocation of $13 billion over the next five years to develop and produce a fleet of new submarines armed with nuclear ballistic missiles. Pentagon sources said it also provides for a new Air Force bomber as well as new generation of land-based nuclear-armed intercontinental ballistic missiles.

The Pentagon’s proposed budget emphasizes the development of naval firepower, with the aim of escalating the Obama administration’s “pivot to Asia,” which has seen increasingly provocative US military operations in the South China Sea. “We’re making all these investments that you see in our defense budget that are specifically oriented towards checking the development of the Chinese military,” Carter said.

The pretense that funding for the vast US military apparatus is driven by the need to keep up with the growth of the Chinese or Russian military is absurd on its face. American military spending last year was greater than that of the next seven largest powers combined. It spent nearly three times as much as China and roughly seven times as much as Russia.

Carter listed five “challenges” that he said the Pentagon budget must seek to counter. At the top of the list were Russia and China, followed by North Korea and Iran. Dead last were the ongoing US interventions against the Islamic State of Iraq and Syria (ISIS), which was lumped together with the so-called war on terror generally, which for nearly 15 years has been presented to the American people as the justification for the uninterrupted growth of American militarism.

Nonetheless, the Pentagon budget provides a substantial increase in funding in this area as well. Totaling $7.5 billion, it includes $1.8 billion to pay for 45,000 bombs and rockets needed to replenish the stockpile that has been depleted by continuous air strikes in Iraq, Syria and Afghanistan.

The US defense secretary emphasized that the shift in strategy was based on a “return to great power competition.” This required the US military to prepare to confront “a high-end enemy” with the “full spectrum” of armed power. This situation, he added, was “drastically different than the last 25 years,” referring to the period since the Moscow Stalinist bureaucracy’s dissolution of the Soviet Union.

Carter insisted that “America is still today the world’s leader” and the “underwriter of stability and security in every region across the globe, as we have been since World War II.”

The US military, he said, had to prepare for confrontation with those “who see America’s dominance and want to take that away from us… in the future so we can’t operate effectively around the globe.”

The mission spelled out by the US defense secretary is essentially a military struggle to impose US control over every corner of the planet. America’s residual military superiority is to be employed to counter the effects of the protracted decline of American capitalism and its domination of the global economy. To this end, US imperialism must confront every real or potential rival for both global and regional hegemony. The path outlined in Carter’s speech leads inexorably toward World War III.

Is Zika a Genetically Engineered Disaster?

Pandora's box: how GM mosquitos could have caused Brazil's microcephaly disaster

by Oliver Tickell - The Ecologist

1st February 2016

In Brazil's microcephaly epidemic, one vital question remains unanswered: how did the Zika virus suddenly learn how to disrupt the development of human embryos?

The answer may lie in a sequence of 'jumping DNA' used to engineer the virus's mosquito vector - and released into the wild four years ago in the precise area of Brazil where the microcephaly crisis is most acute.

These 'promiscuous' transposons have found special favour with genetic engineers, whose goal is to create 'universal' systems for transferring genes into any and every species on earth.

Almost none of the geneticists has considered the hazards involved.

Since August 2015, a large number of babies in Northeast Brazil have been born with very small heads, a condition known as microcephaly, and with other serious malformations. 4,180 suspected cases have been reported.

Epidemiologists have found a convincing correlation between the incidence of the natal deformities and maternal infections with the Zika virus, first discovered in Uganda's Zika Valley in 1947, which normally produces non-serious illness.

The correlation has been evidenced through the geographical distrubution of Zika infections and the wave of deformities. Zika virus has also been detected in the amniotic fluids and other tissues of the affected babies and their mothers.

This latter finding was recently reported by AS Oliveira Melo et al in a scientific paper published in the journal Ultrasound in Obstetrics & Gynecology, which noted evidence of intra-uterine infection. They also warn:

"As with other intrauterine infections, it is possible that the reported cases of microcephaly represent only the more severely affected children and that newborns with less severe disease, affecting not only the brain but also other organs, have not yet been diagnosed."

The Brazilian Health Minister, Marcelo Castro, says he has "100% certainty" that there is a link between Zika and microcephaly. His view is supported by the medical community worldwide, including by the US Center for Disease Control.

Oliveira Melo et al draw attention to a mystery that lies at the heart of the affair: "It is difficult to explain why there have been no fetal cases of Zika virus infection reported until now but this may be due to the underreporting of cases, possible early acquisition of immunity in endemic areas or due to the rarity of the disease until now.

"As genomic changes in the virus have been reported, the possibility of a new, more virulent, strain needs to be considered. Until more cases are diagnosed and histopathological proof is obtained, the possibility of other etiologies cannot be ruled out."

And this is the key question: how - if indeed Zika really is the problem, as appears likely - did this relatively innocuous virus acquire the ability to produce these terrible malformations in unborn human babies?

Oxitec's GM mosquitoes

An excellent article by Claire Bernish published last week on AntiMedia draws attention to an interesting aspect of the matter which has escaped mainstream media attention: the correlation between the incidence of Zika and the area of release of genetically modified Aedes aegypti mosquitos engineered for male insterility (see maps, above right).

The purpose of the release was to see if it controlled population of the mosquitos, which are the vector of Dengue fever, a potentially lethal disease. The same species also transmits the Zika virus.

The releases took in 2011 and 2012 in the Itaberaba suburb of the city of Juazeiro, Bahia, Northeast Brazil, about 500 km west of ther coastal city of Recife. The experiment was written up in July 2015 in the journal PLOS Neglected Tropical Diseases in a paper titled 'Suppression of a Field Population of Aedes aegypti in Brazil by Sustained Release of Transgenic Male Mosquitoes' by Danilo O. Carvalho et al.

An initial 'rangefinder of 30,000 GM mosquitos per week took place between 19th May and 29th June 2011, followed by a much larger release of 540,000 per week in early 2012, ending on 11th February.

At the end of it the scientists claimed "effective control of a wild population of Ae. aegypti by sustained releases of OX513A male Ae. aegypti. We diminished Ae. aegypti population by 95% (95% CI: 92.2%-97.5%) based on adult trap data and 78% (95% CI: 70.5%-84.8%) based on ovitrap indices compared to the adjacent no-release control area."

So what's to worry about?

The idea of the Oxitec mosquitoes is simple enough: the males produce non-viable offspring which all die. So the GM mosqitoes are 'self-extinguishing' and the altered genes cannot survive in the wild population. All very clever, and nothing to worry about!

But in fact, it's not so simple. In 2010 geneticist Ricarda Steinbrecher wrote to the biosafety regulator in Malaysia - also considering a release of the Oxitec mosquitoes - with a number of safety concerns, pointing out the 2007 finding by Phuc et al that 3-4% of the first generation mosquitos actually survive.

The genetic engineerig method employed by Oxitec allows the popular antibiotic tetracycline to be used to repress the lethality during breeding. But as a side-effect, the lethality is also reduced by the presence of tetracycline in the environment; and as Bernish points out, Brazil is among the world's biggest users of anti-microbials including tetracycline in its commercial farming sector:

"As a study by the American Society of Agronomy, et. al., explained, 'It is estimated that approximately 75% of antibiotics are not absorbed by animals and are excreted in waste.' One of the antibiotics (or antimicrobials) specifically named in that report for its environmental persistence is tetracycline.

In fact, as a confidential internal Oxitec document divulged in 2012, that survival rate could be as high as 15% - even with low levels of tetracycline present. 'Even small amounts of tetracycline can repress' the engineered lethality. Indeed, that 15% survival rate was described by Oxitec."

She then quotes the leaked Oxitec paper:

"After a lot of testing and comparing experimental design, it was found that [researchers] had used a cat food to feed the [OX513A] larvae and this cat food contained chicken. It is known that tetracycline is routinely used to prevent infections in chickens, especially in the cheap, mass produced, chicken used for animal food. The chicken is heat-treated before being used, but this does not remove all the tetracycline. This meant that a small amount of tetracycline was being added from the food to the larvae and repressing the [designed] lethal system."

So in other words, there is every possibility for Oxitec's modified genes to persist in wild populations of Aedes aegypti mosquitos, especially in the environmental presence of tetracycline which is widely present in sewage, septic tanks, contaminated water sources and farm runoff.

'Promiscuous' jumping genes

On the face of it, there is no obvious way in which the spread of Oxitec's GM mosquitos into the wild could have anything to do with Brazil's wave of micrcophaly. Is there?

Actually, yes. The problem may arise from the use of the 'transposon' ('jumping' sequence of DNA used in the genetic engineering process to introduce the new genes into the target organism). There are several such DNA sequences in use, and one of the most popular is known as known as piggyBac.

As a 2001 review article by Dr Mae Wan Ho shows, piggyBac is notoriously active, inserting itself into genes way beyond its intended target:

"These 'promiscuous' transposons have found special favour with genetic engineers, whose goal is to create 'universal' systems for transferring genes into any and every species on earth. Almost none of the geneticists has considered the hazards involved ...

"It would seem obvious that integrated transposon vectors may easily jump out again, to another site in the same genome, or to the genome of unrelated species. There are already signs of that in the transposon, piggyBac, used in the GM bollworms to be released by the USDA this summer. 

The piggyBac transposon was discovered in cell cultures of the moth Trichopulsia, the cabbage looper, where it caused high rates of mutations in the baculovirus infecting the cells by jumping into its genes ... This transposon was later found to be active in a wide range of species, including the fruitfly Drosophila, the mosquito transmitting yellow fever, Aedes aegypti, the medfly, Ceratitis capitata, and the original host, the cabbage looper.

"The piggyBac vector gave high frequencies of transpositions, 37 times higher than mariner and nearly four times higher than Hirmar."

In a later 2014 report Dr Mae Wan Ho returned to the theme with additional detail and fresh scientific evidence (please refer to her original article for references): "The piggyBac transposon was discovered in cell cultures of the moth Trichopulsia, the cabbage looper, where it caused high rates of mutations in the baculovirus infecting the cells by jumping into its genes ...

"There is also evidence that the disabled piggyBac vector carrying the transgene, even when stripped down to the bare minimum of the border repeats, was nevertheless able to replicate and spread, because the transposase enzyme enabling the piggyBac inserts to move can be provided by transposons present in all genomes.

"The main reason initially for using transposons as vectors in insect control was precisely because they can spread the transgenes rapidly by 'non-Mendelian' means within a population, i.e., by replicating copies and jumping into genomes, thereby 'driving' the trait through the insect population. However, the scientists involved neglected the fact that the transposons could also jump into the genomes of the mammalian hosts including human beings ...
"In spite of instability and resulting genotoxicity, the piggyBac transposon has been used extensively also in human gene therapy. Several human cell lines have been transformed, even primary human T cells using piggyBac. These findings leave us little doubt that the transposon-borne transgenes in the transgenic mosquito can transfer horizontally to human cells. The piggyBac transposon was found to induce genome wide insertion mutations disrupting many gene functions."

Has the GM nightmare finally come true?

So down to the key question: was the Oxitec's GM Aedes aegypti male-sterile mosquito released in Juazeiro engineered with the piggyBac transposon? Yes, it was. And that creates a highly significant possibility: that Oxitec's release of its GM mosquitos led directly to the development of Brazil's microcephaly epidemic through the following mechanism:

1. Many of the millions of Oxitec GM mosquitos released in Juazeiro in 2011/2012 survive, assisted, but not dependent on, the presence of tetracycline in the environment.

2. These mosquitos interbreed with with the wild population and their novel genes become widespread.

3. The promiscuous piggyBac transposon now present in the local Aedes aegypti population takes the opportunity to jump into the Zika virus, probably on numerous occasions.

4. In the process certain mutated strains of Zika acquire a selective advantage, making them more virulent and giving them an enhanced ability to enter and disrupt human DNA.

5. One way in which this manifests is by disrupting a key stage in the development of human embryos in the womb, causing microcephaly and the other reported deformations. Note that as Melo Oliveira et al warn, there are almost certainly other manifestations that have not yet been detected.

6. It may be that the piggyBac transposon has itself entered the DNA of babies exposed in utero to the modified Zika virus. Indeed, this may form part of the mechanism by which embryonic development is disrupted.

In the latter case, one implication is that the action of the gene could be blocked by giving pregnant women tetracycline in order to block its activity. The chances of success are probably low, but it has to be worth trying.

No further releases of GM insects!

While I am certainly not claiming that this is what actually took place, it is at least a credible hypothesis, and moreover a highly testable one. Nothing would be easier for genetic engineers than to test amniotic fluids, babies' blood, wild Aedes mosquitos and the Zika virus itself for the presence of the piggyBac transposon, using well established and highly sensitive PCR (polymerase chain reaction) techniques.

If this proves to be the case, those urging caution on the release of GMOs generally, and transgenic insects bearing promiscuous transposons in particular, will have been proved right on all counts.

But most important, such experiments, and any deployment of similar GM insects, must be immediately halted until the possibilities outlined above can be safely ruled out. There are plans, for example, to release similarly modified Anopheles mosquitos as an anti-malarial measure.

There are also calls for even more of the Oxitec Aedes aegypti mosquitos to be released in order to halt the transmission of the Zika virus. If that were to take place, it could give rise to numerous new mutations of the virus with the potential to cause even more damage to the human genome, that we can, at this stage, only guess at.

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Canada Changing Course on Russia Relations?

Canada Now Says Open to Dialogue with Russia, What Does This Signal?

by Roger Annis - New Cold War.org

Feb 1, 2016

A shift in the attitude of the Canadian government towards Russia has been announced by Minister of Foreign Affairs Stéphane Dion.

On Wednesday, January 27, Dion announced to the House of Commons in Ottawa that he would visit Ukraine in the coming days. Under opposition party haranguing, he restated views expressed to journalists one day earlier that it was time for a shift in relations with Russia, specifically that at minimum, his government will reopen communication with Russian counterparts.

Dion told the House, “Our foreign policy will stop being ideological and irrational and will be effective for our allies and for Canadians.”

Time for a shift 

Dion began his comments to journalists on Tuesday with a predictable, rote affirmation that ‘Canada would always stand with Ukraine’, but then went on to say it was time to start working with Russia “when we have common interests”.​

“Canada was speaking to the Russians even during the tough times of the Cold War. And now we are not speaking … because of the former policy, of the former government. In what way is it helping our interests in the Arctic? [for example]”

“We have a lot of disagreements with the government of Russia,” he went on, “but it’s certainly not the way to stop speaking with them when the Americans speak with them and all the Europeans, the Japanese, everybody [does so] except Canada. ”

Dion’s comments followed those of Russian Foreign Minister Sergei Lavrov in Moscow on Tuesday at a press conference surveying Russia’s view of the multiple conflicts and tensions in the world. Turning to Canada, Lavrov said Russia “was stunned by the absence of pragmatism” by the previous government of Stephen Harper in its policy concerning Russia and the conflict in Ukraine.

The foreign minister accused the Harper government of following the “blatant interests of the Ukrainian diaspora [while] ignoring Canada’s national interests.” There are about 1.3 million Canadians of Ukrainian descent. Their journeys to Canada began more than 100 years ago and a majority would be born here.

Russia looks forward to new relations with Canada, Lavrov said.[1]

This was the same press conference where Lavrov made clear that Russia will not negotiate with any country about Crimea’s future status. Shifts in relations with the United States due to recent accomplishments of Russian diplomacy over the war in Syria has led to a lot of idle speculation in Western media that maybe Russia could be pressured to soften its support of the March 2014 vote by the Crimean people to secede from Ukraine and rejoin the Russian Federation.

Lavrov said, “We have nothing to give back. We are not holding any talks with anyone on returning Crimea,” he said. “Crimea is a territory of the Russian Federation in full accordance with the expression of the will of its peoples.”

Still early days whether Canada will end its hostility to Russia

Canada has played a leading, provocative role in the military threats by the NATO military alliance against Russia during the past two years. It has encouraged and joined the economic and political sanctions of its fellow imperialist countries against the Russian economy and politicians and businessmen.

Canada has been a leading voice describing the 2014 referendum vote of the Crimean people as a Russian “annexation”. It condemns Russia for assisting the people of eastern Ukraine in resisting the military onslaught against them begun in April 2014 by the right-wing government that came to power in a coup in February 2014. That onslaught is spearheaded by extremist and fascist paramilitary battalions with which the government is allied but which Western media blacks out of its reporting.

It gets worse. Canada, along with the United States and Britain, has soldiers and police on Ukrainian soil in ‘training missions’ whose ultimate goal is not disclosed but which gravely threaten and destabilize the entire border region between Russia and eastern Europe. Ukraine’s constitution expressly prohibits the presence of foreign soldiers on its soil, but the country’s Parliament happily agreed to waive that last April in order to welcome the Western troops.[2]

Canada also participates in the ongoing NATO military exercises on land and sea in eastern and western Europe whose goal is to send Russia the message: ‘obey our diktats, or else’.

Unknown to Canadians and Americans, Arctic cooperation is a model

Foreign Minister Dion cited Arctic cooperation as an area where Canada has lost out during the past two years of Anti-Russia policy. Indeed, Canadians (and Americans) don’t know the half of what Dion was referring to.

It turns out that scientific as well as economic cooperation among the eight countries that border the Arctic region has been stellar for decades and, fortunately, has not suffered much from the NATO-led folly and confrontations of the past two years. Given that the Arctic is ground zero of the visible, calamitous consequences of global warming, it’s good news that Arctic cooperation is surviving. (The bad news, of course, is that this is not, and now cannot, stop the inexorable melting of Arctic ice, but that’s another story.)

Canadians, for one, will be utterly in the dark over the record of Arctic cooperation because the chosen angle of reportage of this subject in mainstream media in Canada is, surprise!, that Russia is a threat to Canada’s interests and ambitions in the region.

For example, the sub-headline to an article by Scott Gilmore in Maclean’s magazine on November 15, 2015, reads, “All of Moscow’s effort and attention, combined with Canada’s neglect, has effectively turned the Arctic Ocean into Putin’s Lake.” He writes:

Justin Trudeau recently promised to push back “the bully that is Vladimir Putin”. Supporters may enthusiastically imagine the tall boxer staring down the short black belt. [Editor’s note: Justin Trudeau is an accomplished boxer.] Unfortunately, the more accurate picture would have Trudeau sitting on a battered snowmobile, craning his neck to see Putin standing far above him on the bridge of a nuclear-powered icebreaker.

Brian Stewart, an eminence grise of the CBC state broadcaster wrote earlier the same month:

An oddity of Canada’s foreign policy of late is how gravely we viewed Russia’s expanding power in distant Eastern Europe and Syria, yet took scarce note of Moscow’s actions closer to our own Arctic and Asia-Pacific interests.

Even allowing for the vast distances involved, Vladimir Putin’s strategic thrusts are almost on our doorstep and may well require far more serious attention from the incoming Liberal government.

A common theme of the scare-mongering reporting is that Canada needs to boost its military spending and presence in the Arctic in order to confront an aggressive Russia.

A very different view of the Arctic is provided by Dr. Michael Byers of the University of British Columbia, an expert on all things Arctic. He spoke at a public forum attended by this writer in Vancouver last November 18. The theme of the forum was ‘ Russia, the Arctic and crisis in Ukraine’.

Dr. Byers is a professor in UBC’s Department of Political Science. He holds a Canada Research Chair in Global Politics and International Law. His work focuses on Arctic sovereignty, climate change, the law of the sea and Canadian foreign and defence policy. He has written several books on the Arctic, including the 2013 ‘International Law and the Arctic’.

Perhaps to the surprise of many in the audience on November 18 (given the title of the event), Byers explained that Russia’s scientific cooperation in the Arctic has been stellar for decades and remains so. He cited a string of scientific, political and transport treaties and agreements going back decades between the eight member countries of the Arctic Council–Russia, The United States, Canada, Denmark, Norway, Iceland, Finland and Sweden.

Worse news for the war party in Canada was Byer’s claim that Canada is the laggard among Arctic countries on matters scientific, social and otherwise. The most glaring example of Canada’s neglect and abuse of its Arctic territory is the scandalous social and economic conditions of the Indigenous peoples of Canada’s north. A great many live in Third World conditions.[3]

Canada’s search and rescue capacity in the north is scant. Most of it is located thousands of kilometres away to the south.

Concerning Canada’s scientific capacity in the north, Byers reported its shortcomings as well as the cuts and the silencing of scientists during the Harper government years that made things worse. He reported the embarrassing fact that the lead vessel in the Canadian expedition that in September 2014 located one of the two lost ships from Britain’s 1845 Franklin Expedition was Russian! (This fact was utterly unreported in all the Canadian government and media hoopla that accompanied the finding.)

Earlier, in September 2014, Michael Byers took part in a public forum at UBC titled, Arctic War or Arctic Peace? The Stakes for Canada’. The forum was a debate between him and a pro-military ideologue arguing for more confrontation with Russia.

Byers told the forum, “On Arctic security, in my view, the overriding issue is climate change.” He argued that competing states, including Russia, are no threat to Canada’s ambitions in the Arctic, outside of the normal waxing and waning of international politics.

“There is a tendency in the media to ‘hype up’ the threats from other states [in the Arctic],” he said.

Byers argued that the positive attitude towards cooperation in the Arctic by Russia has remained unchanged since the events in Ukraine. He repeated that claim at the November 2015 forum. (He says, perhaps cynically, that Russia’s cooperation stems from the fact that Russia has benefitted economically and otherwise for decades from a cooperative rather than confrontational Arctic arrangement.)

All the more remarkable in Byers’ comments is that he counts himself among the Russia-bashers in Canada. He argues for a big military expansion of Canada in the Arctic, in part to counter Russian influence. At the November 2015 forum, he told the audience, “Let’s be clear, I believe Vladimir Putin is a thug.” He said that Russia staged a brutal “annexation” of Crimea in early 2014.

He told the Sept 2014 forum, “There are reasons to be concerned about the Putin regime, serious reasons to be concerned about the Putin regime.” He called Russia “a dangerous and dark regime”.

At the November 2015 forum, Byers made his standard pitch for increased military spending. “We are the second largest country in the world, we need a larger military.”

Where is Canadian policy headed?

What does the shift in Canadian tone towards Russia herald? That’s tough to answer because first of all, policy will ultimately be decided by Washington, upon which time Canada will sign up.[4] The question to be answered in this regard, then, is where U.S. policy is headed.

Secondly, as Dion has signalled, there will be no change in Canada’s support to the right-wing regime in power in Kyiv. Too many years of coddling and support to Ukraine’s ultra-nationalists have passed. The three large parties in Parliament are unanimous on the matter. Too many lead voices in the anti-Russia bandwagon in Canada, beginning with lead attacker and now Minister of International Trade Chrystia Freeland, are comfortably at the center of power in the new government of Justin Trudeau.

Turning to the question of where U.S. policy is headed (with Canada and other U.S. allies in tow), that’s a complicated one. At least three major issues are determining the U.S. course:

Russia’s diplomatic initiatives with respect to the war in Syria begun last October are reshaping the Middle East by eroding U.S. diktat over the region. The emerging, de facto alliance between Russia, Iran, forces of the Kurdish people, the Syrian government and progressive forces in Turkey has already weakened the U.S.-EU-Israel-Saudi-right wing Islamist nexus and is likely to continue to do so.

In Ukraine, the Kyiv’s government’s economic and political crisis is profound and renders it an unstable pawn in the NATO threats and buildup against Russia. Furthermore, the shifts towards dialogue if not cooperation with Russia in the Middle East open uncomfortable questions about the situation in Ukraine.

Russia has been relentlessly painted as a big, bad wolf for the past two years. Now there is dialogue opening up, yet Crimea remains “annexed” while the “separatists” (pro-autonomy) political forces in Donbass (eastern Ukraine) are as “separatist” as ever with continued Russian backing. So what has all the fuss of the last two years been about? Is there something we were not told? Have we been fed stories of “Russian aggression” in order to sell an anti-Russia political agenda by the NATO countries?

All the industrial countries of the world are under intense pressure to respond to the rising awareness among the world’s population of global warming. Demands are growing louder for radical, political and economic measures to forestall the worst consequences of global environmental and climactic degradation.

Stay tuned for how this all ends. And settle in. 2016 promises to be a year of many surprises and, if we’re lucky, some reversal of the crazed descent into war, austerity and climate emergency. Then the real work of salvaging our planet and futures may begin.


Notes:
[1] The full text of Lavrov’s comments on Russia-Canada relations is here. 
[2] See ‘West Ukraine is now a permanent playground for NATO forces‘, by Ulrich Heyden, published in German on Telepolis, Nov 26, 2015, translated to English for New Cold War.org. 
[3] Aboriginal people make up the majority of the population in Canada’s north. They suffer multiple times higher rates of poverty, illness and disease, including scandalously high rates of youth suicide, compared to the rest of the country.

The very high cost of food in the north is one of the reasons for the overall public health emergency. A Nov 4, 2014 Globe and Mail article series reported, “About 13 per cent of Canadian households – that’s about four million people, including 1.15 million children – experienced some level of food insecurity in 2012, according to a 2014 report by PROOF, an interdisciplinary team of researchers focused on issues of food insecurity. In Nunavut [comprising most of the Canadian Arctic Archipelago], the figure was 45.2 per cent.” 

[4] Canada-U.S. (Alaska) relations in the Arctic sometimes conflict. The U.S., for example, does not recognize Canada’s claim to exclusive jurisdiction over and under waters adjacent to Canada’s Arctic coastlines.

Listen:
Speech by Minister of Foreign Affairs Stéphane Dion on January 28, 2016 outlining ‘new foreign policy’ of Canada. Speech begins at 48’mark, comments on Russia and Ukraine begin at 58’mark (three minutes). Sanctions against Russia will remain in place, says Dion.

This article also appeared in Counterpunch and in Rabble.ca.

Roger Annis is a retired aerospace worker in Vancouver BC. He is an editor of the website The New Cold War: Ukraine and beyond. He can be reached at rogerannis@hotmail.com.

Got Money? The Candidates with the Biggest, Baddest Billionaires

Rubio's Billionaire Vulture: Paul Singer, the GOP's Baddie Sugar Daddie

by Greg Palast

February 1, 2016

Greg Palast has been investigating Singer and other finance vultures for BBC Television's Newsnight.

It's out of the closet –– or, more accurately, out of the coven. The list of the billionaires who have given at least $2.5 million to Conservative Solutions, the pro-Rubio Super PAC, is headed by Paul Singer. Singer and his hedge fund crew at Elliott Associates, with their donations to the Republican National Committee and other "independent" groups like "Solutions", makes it likely that Singer is now the top funder for the GOP.

The untold story of the sources of the loot controlled by Paul "The Vulture" Singer and why he needs to buy the White House

For BBC-TV, I've been tracking Singer for nine years. And this is the key fact you need to know about the man whose cash would pick our President: Paul Singer likes to breakfast on decayed carcasses.

The carrion king is known as Singer The Vulture. I didn't give him the moniker. The name Vulture was tagged on him and his speculator colleagues by the Prime Minister of Britain and the World Bank. Recently, former Deputy Secretary-General of the UN Winston Tubman suggested I ask Singer or his business associates, "Do you know you're causing babies to die?"

What does this guy do—put poison in kiddies' milk? Worse: he takes away the milk.

Before I get to the story of his attack on African kids, let me tell you how Singer made his first billion, his first killing (and I don't mean that metaphorically): via an attack on victims of asbestos poisoning.

Background: The executives of a few asbestos companies, WR Grace, USG and Owens-Corning, knew that their asbestos factories were killing their workers. When caught and sued, the companies filed for bankruptcy, agreeing to pay almost all their earnings to those dying and injured by their asbestos.

But Singer had a better idea. These companies, as you can imagine, were worth next to nothing; and Singer bought Owens-Corning for a song.

If he could cut the amount paid to the victims, Singer could boost Corning's value big time. So, a PR campaign was begun attacking the dying workers, saying they were all faking it.

One attacker was a guy named George W. Bush.

In January 2005, President Dubya held a televised meeting to promote an "expert" who pronounced that over half a million workers suing Singer's industry were liars. If workers couldn't breathe, he said to the grinning President, it wasn't the fault of asbestos.

The "expert" was not a doctor, but notably, his "research" was partly funded by ...Paul Singer. And so was Bush. Since the death of Enron's Ken Lay, Singer and his vulture flock at Elliott International had become the top contributors to the Republican National Committee. It's hard to measure his largesse exactly because some of that help comes in through the side door. For example, Singer put money behind the "Swift Boat" smear on Bush's opponent, John Kerry.

The legal, political and PR attacks on the dying workers chiseled away the compensation expected to be paid by the asbestos companies, boosting their net worth. Singer then flipped Corning, selling it for a neat billion-dollar profit.

It's legal, it's brilliant, it's sick, it's Singer.

Asbestos workers have lawyers and the law, weak as it may be, so Singer only made a billion. Singer hit on a way of squeezing billions from those even more vulnerable.

Singer's new modus operandi is to find some forgotten tiny debt owed by a very poor nation (Peru and Congo were on his menu). He waits for the US and European taxpayers to forgive the poor nations' debts; then waits at bit longer for offers of food aid, medicine and investment loans. Then Singer pounces: legally grabbing at every resource and all the money going to the desperate country. Trade stops, funds freeze and an entire economy is effectively held hostage.

Singer then demands aid-giving nations pay monstrous ransoms to let trade resume. At BBC TV's Newsnight, we learned that Singer demanded $400 million dollars from the Congo for a debt he picked up for less than $10 million. If he doesn't get his 4,000% profit, he can effectively starve the nation. I don't mean that figuratively—I mean starve as in no food. In Congo-Brazzaville last year, one-fourth of all deaths of children under five were caused by malnutrition.

For BBC, I tried to ask Vulture Singer the diplomat's question about the baby killing, but I couldn't get past George Gershwin. (In the New York office tower housing the billionaires' roost, a George Gershwin look-alike in top hat and tails plays show tunes on a grand piano for Singer's grand entrance.)

One of my favorite Singer scores was his successful scheme to legally loot the Treasury of Peru. The nation's US lawyer told me, aghast, how Singer let Peru's rogue President, Alberto Fujimori, flee his nation to avoid murder charges. Singer had seized Fujimori's get-away plane. The Vulture named his price: One of Fujimori's last acts as president before he fled was to order his dirt-poor nation to pay Singer $58 million.

Why the Billionaires Need to Buy the White House

Paul Singer had placed a big bet on the asbestos industry; then, set out to fix the casino, helping install Bush in the White House. That is, he had a President willing to beat up on asbestos workers and push for so-called "tort reform" that undermined these victims' claims. What the victims lost, Singer gained.

But there's trouble on the horizon for Singer. In 2007, Britain outlawed Singer and all other Vulture speculators in Third World debt from collecting their pound of flesh in the United Kingdom. Other European nations are following suit.

Several US Congressmen are pushing a UK-style prohibition on Singer's activities. (Even Chevron Corporation is complaining about the Vulture attacks. When Chevron calls bankers unscrupulous, they've got to be really unscrupulous.) Without a veto pen over Congress, Singer stands to lose hundreds of millions of dollars.

Singer plays defense, but is best at offense: To collect on some of his claims against Argentina, his lobbyists have pushed a bill in Congress to put an economic choke-hold on trade with the South American nation. Obama and Secretary of State Hillary Clinton blocked this crazy attack on our ally. As a result, Singer is not a happy gaucho. There will be blood. Obama will have to pay.

What every billionaire wants

There's one thing that every billionaire wants: another billion. And that's threatened by Obama's plan to tax the "carried interest" tax deferment.

Guys like Singer don't pay taxes like you and I do. While we pay taxes on income, the profits from vulture speculation and arbitrage are often recorded as "carried interest," effectively not taxed for years, then when collected, only at a low rate. It's a billion-dollar benefit for the billionaires, and every Republican candidate has sworn to keep this loophole open and make sure you and I pay Singers' taxes for him.

* * * * *

In 2016 Greg Palast will be releasing his new feature length documentary The Best Democracy Money Can Buy—A Tale of Billionaires and Ballot Bandits, which includes Paul The Vulture Singer.

Greg Palast is the author of several New York Times bestsellers including The Best Democracy Money Can Buy and Billionaires & Ballot Bandits, Armed Madhouse and the highly acclaimed Vultures' Picnic.

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Tony Still a Tiger for War: Blair Calls for European Army

Former British Prime Minister Blair joins call for a European army

by Jordan Shilton  - WSWS.org

2 February 2016

Former British Prime Minister Tony Blair recently called in a Newsweek magazine column for the establishment of a European army organised independently of the NATO alliance.

As part of a broader plea for unity among the major European Union (EU) powers under the title “European unity has never been more important,” Blair wrote that the European powers had to be capable of projecting their interests on the global stage.

“I would argue that in the medium term, there will be a growing requirement for Europe to build defence capability. That force would not supplant NATO, but would have the independent ability to take military action at times when Europe’s security interests are threatened when the US may decide not to be involved.”

Justifying the creation of a European military force, Blair cited the rise in global geopolitical rivalries. “The world is changing,” he said.

“New and vast powers will have the capacity to dominate. Smaller nations—and this means anyone with fewer than 100 million people—have to leverage their geographic relationships to maintain weight.”

These “vast powers” were explicitly identified as Russia and China, who were taking advantage of a shift east in global power.

During a decade in government in Britain beginning in 1997, Blair was Washington’s staunchest ally in Europe and fully supported the United States’ military predominance through the NATO alliance. In 1999, the Blair government rejected a call by then EU Commission President Romano Prodi for an independent European army and defended the NATO defence framework. British aircraft participated in the NATO-led bombardment of Yugoslavia, in which the US played the decisive role. Then in 2003, Britain was the only major European power to join the Bush administration in the US-led invasion and occupation of Iraq.

His shift to support a European army, though by no means signalling a break from the US, reflects mounting imperialist tensions around the globe.

The US is waging war in the Middle East to secure its hegemony over the world’s most important oil-producing region, leading the encirclement of Russia in Eastern Europe and the Baltic, and pursuing an aggressive course in the Asia-Pacific against China, but its imperialist rivals are also intent on reasserting their own geopolitical interests.

Germany has been conducting a sustained drive to implement a more militarist foreign policy by sending troops to North Africa and Syria, while academics and media outlets carry out an ideological push to revive the plans for German domination of Europe and the world which had such disastrous consequences in the first half of the 20th century. France seized on the November 13 terrorist attacks in Paris to intervene in Syria, and is also conducting major operations in North Africa.

Blair’s call for European unity is an attempt to reassert his long-held position of the UK playing a pivotal role as a bridge between the US and Europe.

A referendum is due on Britain’s membership within the EU by the end of 2017. Washington has strongly indicated its opposition to Britain leaving the bloc, and military experts have warned that a “Brexit” would lead to a deterioration in the “special relationship” with the US, resulting in Washington aligning itself more firmly with Paris or Berlin.

However, the euroskeptic wing of Britain’s ruling elite is concerned that if a united European army is the price London has to pay for renegotiating its relationship with Brussels, then this will instead undermine British imperialism’s strategic position, above all its alliance with Washington, as France and Germany emerge as more assertive military powers.

In September, the Daily Telegraph revealed that Chancellor Angela Merkel suggested a deal may be possible with Prime Minister David Cameron in his attempt to renegotiate British relations with the EU, but only if Cameron was prepared to back the integration of military forces on the continent.

The Telegraph cited an unpublished position paper drawn up by Europe and Defence policy committees of Merkel’s Christian Democrats (CDU), setting out “a detailed 10-point plan for military co-operation in Europe.”

If a European army is created, Germany, as the continent’s largest economic power, would demand to play the dominant role within it, and it is Germany that is playing the central role in moves towards its creation.

Under provisions in the Lisbon Treaty adopted in 2009, EU member states agreed on potential cooperation with the establishment of a common security and defence policy. The treaty contained a mutual defence clause for the first time, which obligated member states to assist a state if it faced a major attack. This was the clause invoked by France in the wake of the 13 November Paris terrorist attacks to secure EU military assistance.

EU Commission President Jean Claude Juncker told Welt am Sonntag last March, “[A] common army among the Europeans would convey to Russia that we are serious about defending the values of the European Union.” He stressed, “Europe’s image has suffered dramatically and also in terms of foreign policy, we don’t seem to be taken entirely seriously.”

Juncker’s statement was backed by Norbert Rottgen, chairman of the German Parliament’s Foreign Affairs Committee, German Green MEP Jan Philipp Albrecht and, most significantly, German Defense Minister Ursula von der Leyen, who told Deutschlandfunk radio station that a “European army is the future.”

The conservative group in the European parliament, the European People’s Party (EPP), backed the move in a position paper released in October. EPP President Joseph Daul commented, “We are going to move towards an EU army much faster than people believe.”

The EPP went much further than Juncker’s proposal, calling for a force capable of taking on missions of “higher intensity” including replacing national guards at EU borders—a policy now in part implemented regarding the EU’s Frontex border force.

The EPP’s paper that an EU army must be “able to conduct territorial defence… Russian aggression against members of the EU and NATO must be deterred.” A key policy adviser noted that since 2007 the EU has had two rotating emergency battlegroups of 1,500 men, which have never seen combat—which he described as a “failure” that “must be addressed.”

The EPP stressed, “The EU should not be caught up in enlargement fatigue, but should rather keep a pro-EU spirit in the region of the Western Balkans alive and support the aspirations of these countries to join the EU.”

Turkey was described as a pivotal state in securing Europe’s military security.

On December 27, German Finance Minister Wolfgang Schäuble told Bild am Sonntag that “we will have to spend a lot more funds for joint European defence initiatives... [as] ultimately our aim must be a joint European army.” He cited the Middle East and Africa as key locations for military operations.

At the NATO summit in Wales in 2014, the 28 member states pledged to increase defence spending to 2 percent of GDP. But an objection was raised to this proposal, principally from Germany and Canada, that public opinion would not tolerate such a drastic hike in spending on the armed forces. The promotion of a “European” army, coupled with rhetorical pledges to be creating a united force to secure peace and stability, is seen as a necessary propaganda cover for a vast expansion of military budgets.

Moves towards a European army confirm that the period in which the unity of a capitalist Europe was hailed as the guarantor of peace, freedom and democracy is at an end. Instead, the major powers are reasserting their imperialist interests with military interventions in Africa and the Middle East, supporting a political coup in Ukraine, threatening Russia with military retaliation, and utilising the refugee crisis as a pretext to stir up militarism and xenophobia and to deploy military personnel across the continent.

Ashes to Iowa: A War Hawk's Mad Gyre

Hillary and the Urn of Ashes 

by Conn Hallinan - CounterPunch

February 2, 2016

Aeschylus—who had actually fought at Marathon in 490 BC, the battle that defeated the first Persian invasion of Greece—had few illusions about the consequences of war.

His ode is one that the candidates for the U.S. presidency might consider, though one doubts that many of them would think to find wisdom in a 2,500 year-old Greek play.


And that, in itself, is a tragedy.

“They sent forth men to battle. But no such men return;
And home, to claim their welcome.
Comes ashes in an urn.”

— Ode from “Agamemnon,” Aeschylus

Historical blindness has been much on display in the run-up to the Iowa and New Hampshire primaries. On the Republican side candidates were going to “kick ass” in Iraq, make the “sand glow” in Syria, and face down the Russians in Europe. But while the Democratic aspirants were more measured, there is a pervasive ideology than binds together all but cranks like Ron Paul: America has the right, indeed, the duty to order the world’s affairs.

This peculiar view of the role of the U.S. takes on a certain messianic quality in candidates like Hillary Clinton, who routinely quotes former Secretary of State Madeline Albright’s line about America as “the indispensible nation” whose job is to lead the world.

At a recent rally in Indianola, Iowa, Clinton said that,

“Senator [Bernie] Sanders doesn’t talk much about foreign policy, and, when he does, it raises concerns because sometimes it can sound like he really hasn’t thought things through.”

The former Secretary of State was certainly correct. Foreign policy for Sanders is pretty much an afterthought to his signature issues of economic inequality and a national health care system. But the implication of her comment is that she has thought things through. If she has, it is not evident in her biography, Hard Choices, or in her campaign speeches.

Hard Choices covers her years as Secretary of State and seemingly unconsciously tracks a litany of American foreign policy disasters: Afghanistan, Iraq, Libya, Syria, Georgia, Ukraine, and the “Asia pivot” that has dangerously increased tensions with China. At the heart of Hard Choices is the ideology of “American exceptionalism,” which for Clinton means the right of the U.S. to intervene in other countries. As historian Jackson Lears, in the London Review of Books, puts it, Hard Choices “tries to construct a coherent rationale for an interventionist foreign policy and to justify it with reference to her own decisions as Secretary of State. The rationale is rickety: the evidence unconvincing.”

Clinton is undoubtedly an intelligent person, but her book is remarkably shallow and quite the opposite of “thoughtful.” The one act on her part for which she shows any regret is her vote to invade Iraq. But even here she quickly moves on, never really examining how it is that the U.S. has the right to invade and overthrow a sovereign government. For Clinton, Iraq was only a “mistake” because it came out badly.

She also demonstrates an inability to see other people’s point of view. Thus the Russians are aggressively attempting to re-establish their old Soviet sphere of influence rather than reacting to the steady march of NATO eastwards. The fact that the U.S. violated promises by the first Bush administration not to move NATO “one inch east” if the Soviets withdrew their forces from Eastern Europe is irrelevant.

She doesn’t seem to get that a country that has been invaded three times since 1815 and lost tens of millions of people might be a tad paranoid about its borders. There is no mention of the roles of U.S. intelligence agencies, organizations like the National Endowment for Democracy, and of openly fascist Ukranian groups played in the coup against the elected government of Ukraine.

Clinton takes credit for the Obama administration’s “Asia Pivot” that “sent a message to Asia and the world that America was back in its traditional leadership role in Asia,” but she doesn’t consider how this might be interpreted in Beijing. The U.S. never left Asia—the Pacific basin has long been our major trading partner—so, to the Chinese, “back” and “pivot” means that the U.S. plans to beef up its military in the region and construct an anti-China alliance system. It has done both.

Clinton costumes military intervention in the philosophy of “responsibility to protect,” or “R2P,” but her application is selective. She takes credit for overthrowing Muammar Gaddafi in Libya, but in her campaign speeches she has not said a word about the horrendous bombing campaign being waged by Saudi Arabia in Yemen. She cites R2P for why the U.S. should overthrow Bashar al-Assad in Syria, but is silent about Saudi Arabia’s intervention in Bahrain to crush demands for democracy by its majority Shiite population.

Clinton, along with Samantha Power, U.S. Ambassador to the UN, and Susan Rice, the Obama administration’s National Security Advisor, has pushed for muscular interventions without thinking—or caring—about the consequences

And those consequences have been dire.

Afghanistan: Somewhere around 220,000 Afghans have died since the 2001 U.S. invasion, and millions of others are refugees. The U.S. and its allies have suffered close to 2,500 dead and more than 20,000 wounded, and the war is far from over. The cost: close to $700 billion, not counting the long-term medical bill that could run as high as $2 trillion.

Libya: Some 30,000 people died and another 50,000 were wounded in the intervention and civil war. Hundreds of thousands have been turned into refugees. The cost was cheap: $1.1 billion, but it has created a tsunami of refugees and the war continues. It also produced one of Clinton’s more tasteless remarks. Referring to Gaddafi, she said, “We came, we saw, he died.” The Libyan leader was executed by having a bayonet rammed up his rectum.

Ukraine: The death toll is above 8,000, some 18,000 have been wounded, and several cities in the eastern part of the country have been heavily damaged. The fighting has tapered off although tensions remain high.

Yemen: Over 6,000 people have been killed, another 27,000 wounded, and, according to the UN, most of them are civilians. Ten million Yeminis don’t have enough to eat, and 13 million have no access to clean water. Yemen is highly dependent on imported food, but a U.S.-Saudi blockade has choked off most imports. The war is ongoing.

Iraq: Somewhere between 400,000 to over 1 million people have died from war-related causes since the 2003 invasion. Over 2 million have fled the country and another 2 million are internally displaced. The cost: close to $1 trillion, but it may rise to $4 trillion once all the long-term medical costs are added in. The war is ongoing.

Syria: Over 250,000 have died in the war, and four million Syrians are refugees. The country’s major cities have been ravaged. The war is ongoing.

There are other countries—like Somalia—that one could add to the butcher bill. Then there are the countries that reaped the fallout from the collapse of Libya. Weapons looted after the fall of Gaddafi largely fuel the wars in Mali, Niger, and the Central African Republic.

And how does one calculate the cost of the Asia Pivot, not only for the U.S., but for the allies we are recruiting to confront China? Since the “Pivot” took place prior to China’s recent assertiveness in the South China Sea, is the current climate of tension in the Pacific basin a result of Chinese aggression, or U.S. provocation?

Hillary Clinton is not the only Democrat who thinks American exceptionalism gives the U.S. the right to intervene in other countries. That point of view it is pretty much bi-partisan. And while Sanders voted against the Iraq war and criticizes Clinton as too willing to intervene, the Vermont senator backed the Yugoslavia and Afghan interventions. The former re-ignited the Cold War, and the latter is playing out like a Rudyard Kipling novel.

In all fairness, Sanders did say, “I worry that Secretary Clinton is too much into regime change and a bit too aggressive without knowing what the unintended consequences may be.”

Would Hillary be more inclined toward an aggressive foreign policy? Certainly more than Obama’s—Clinton pressed the White House to directly intervene in Syria and was far more hard line on Iran. More than the Republicans? It’s hard to say, because most of them sound like they have gone off their meds. For instance, a number of GOP candidates pledge to cancel the nuclear agreement with Iran, and, while Clinton wanted to drive a harder bargain than the White House did, in the end she supported it.

However, she did say she is proud to call Iranians “enemies,” and attacked Sanders for his remark that the U.S. might find common ground with Iran on defeating the Islamic State. Sanders then backed off and said he didn’t think it was possible to improve relations with Teheran in the near future.

The danger of Clinton’s view of America’s role in the world is that it is old fashioned imperial behavior wrapped in the humanitarian rationale of R2P and thus more acceptable than the “make the sands glow” atavism of most the Republicans. In the end, however, R2P is just death and destruction in a different packaging.

Aeschylus got that: “For War’s a banker, flesh his gold.”

Conn Hallinan can be read at dispatchesfromtheedgeblog.wordpress.com

More articles by:Conn Hallinan