Who Has Cheapest Big Macs? Fri Apr 25, 9:11 AM ET Add Oddly Enough – Reuters to My Yahoo!

BEIJING (Reuters) – Critics who charge that China’s exchange rate policy gives it an unfair edge in selling its goods abroad have some statistical sauce to beef up their argument: the McDonald’s Big Mac.

In its latest “Big Mac index,” the Economist found that a Big Mac in China is now cheaper than anywhere else surveyed, replacing Argentina, which offered the cheapest burger in January.

The survey found that the average price of a Big Mac was $2.71 in four U.S. cities and just $1.20 in China, implying that the yuan was undervalued by 56 percent against the dollar.

“In other words, the yuan is the most undervalued currency,” The Economist said.

The index is a rough-and-ready measure of a concept that economists call purchasing-power parity, valuing currencies according to what they will buy at home, rather than in international exchange.

The yuan is pegged to the U.S. currency, moving in a very slim band around 8.28 to the dollar. It cannot be exchanged freely for foreign currencies, but can be for sandwiches.

Many economists argue the yuan is undervalued, saying China’s booming exports and high-revving economy would have caused the currency to appreciate if it traded freely against the dollar.

In recent months, officials from Japan, South Korea (news – web sites) and the United States have complained about the yuan’s dollar peg and said China should revalue its currency to reflect its underlying strength.

The Economist said that according to the Big Mac index the yuan exchange rate should be around 3.65 to the dollar.

“China will come under increasing pressure to revalue the yuan,” the magazine forecast.

In terms of Big Macs, the Swiss franc was the most overvalued currency, with the burger costing a whopping $4.52.

Big Macs were 10 percent dearer in areas using the euro than in the United States.

-Ian.

—- http://www1.iraqwar.ru/iraq-read_article.php?articleId”11&lang=en

The Real But Unspoken Reasons For The Iraq War – OIL U$ Dollar vs. Euro 08.04.2003 [12:37]

Summary Although completely suppressed in the U.S. media, the answer to the Iraq enigma is simple yet shocking – it an an oil CURRENCY war. The Real Reason for this upcoming war is this administration’s goal of preventing further OPEC momentum towards the euro as an oil transaction currency standard. However, in order to pre-empt OPEC, they need to gain geo-strategic control of Iraq along with its 2nd largest proven oil reserves. This lengthy essay will discuss the macroeconomics of the “petro-dollar” and the unpublicized but real threat to U.S. economic hegemony from the euro as an alternative oil transaction currency. THE REAL REASONS FOR THE UPCOMING WAR IN IRAQ A Macroeconomic and Geostrategic Analysis of the Unspoken Truth By W. Clark wrc92 [at] aol [dot] com “If a nation expects to be ignorant and free, it expects what never was and never will be … The People cannot be safe without information. When the press is free, and every man is able to read, all is safe.” Those words by Thomas Jefferson embody the unfortunate state of affairs that have beset our nation. As our government prepares to go to war with Iraq, our country seems unable to answer even the most basic questions about this war. First, why is there virtually no international support to topple Saddam? If Iraq’s WMD program truly possessed the threat level that President Bush has repeatedly purported, why is there no international coalition to militarily disarm Saddam? Secondly, despite over 300 unfettered U.N inspections to date, there has been no evidence reported of a reconstituted Iraqi WMD program. Third, and despite Bush’s rhetoric, the CIA has not found any links between Saddam Hussein and Al Qaeda. To the contrary, some analysts believe it is far more likely Al Qaeda might acquire an unsecured former Soviet Union Weapon(s) of Mass Destruction, or potentially from sympathizers within a destabilized Pakistan. Moreover, immediately following Congress’s vote on the Iraq Resolution, we suddenly became aware of North Korea’s nuclear program violations. Kim Jong Il is processing uranium in order to produce nuclear weapons this year. President Bush has not provided a rationale answer as to why Saddam’s seemingly dormant WMD program possesses a more imminent threat that North Korea’s active program? Strangely, Donald Rumsfeld suggested that if Saddam were “exiled” we could avoid an Iraq war? Confused yet? Well, I’m going to give their game away – the core driver for toppling Saddam is actually the euro currency, the â,. Although completely suppressed in the U.S. media, the answer to the Iraq enigma is simple yet shocking. The upcoming war in Iraq war is mostly about how the ruling class at Langley and the Bush oligarchy view hydrocarbons at the geo-strategic level, and the overarching macroeconomic threats to the U.S. dollar from the euro. The Real Reason for this upcoming war is this administration’s goal of preventing further OPEC momentum towards the euro as an oil transaction currency standard. However, in order to pre-empt OPEC, they need to gain geo-strategic control of Iraq along with its 2nd largest proven oil reserves. This lengthy essay will discuss the macroeconomics of the “petro-dollar” and the unpublicized but real threat to U.S. economic hegemony from the euro as an alternative oil transaction currency. The following is how an astute and anonymous friend alluded to the unspoken truth about this upcoming war with Iraq… “The Federal Reserve’s greatest nightmare is that OPEC will switch its international transactions from a dollar standard to a euro standard. Iraq actually made this switch in Nov. 2000 (when the euro was worth around 80 cents), and has actually made off like a bandit considering the dollar’s steady depreciation against the euro.” (Note: the dollar declined 15% against the euro in 2002.) “The real reason the Bush administration wants a puppet government in Iraq – or more importantly, the reason why the corporate-military-industrial network conglomerate wants a puppet government in Iraq – is so that it will revert back to a dollar standard and stay that way.” (While also hoping to veto any wider OPEC momentum towards the euro, especially from Iran – the 2nd largest OPEC producer who is actively discussing a switch to euros for its oil exports). Furthermore, despite Saudi Arabia being our ‘client state,’ the Saudi regime appears increasingly weak/ threatened from massive civil unrest. Some analysts believe a “Saudi Revolution” might be plausible in the aftermath of an unpopular U.S. invasion of Iraq (ie. Iran circa 1979) (1). Undoubtedly, the Bush administration is acutely aware of these risks. Hence, the neo conservative framework entails a large and permanent military presence in the Persian Gulf region in a post Saddam era, just in case we need to surround and grab Saudi’s oil fields in the event of a coup by an anti-western group. But first back to Iraq. “Saddam sealed his fate when he decided to switch to the euro in late 2000 (and later converted his $10 billion reserve fund at the U.N. to euros) – at that point, another manufactured Gulf War become inevitable under Bush II. Only the most extreme circumstances could possibly stop that now and I strongly doubt anything can – short of Saddam getting replaced with a pliant regime.” Big Picture Perspective: Everything else aside from the reserve currency and the Saudi/Iran oil issues (i.e. domestic political issues and international criticism) is peripheral and of marginal consequence to this administration. Further, the dollar-euro threat is powerful enough that they’ll rather risk much of the economic backlash in the short-term to stave off the long-term dollar crash of an OPEC transaction standard change from dollars to euros. All of this fits into the broader Great Game that encompasses Russia, India, China.” This information about Iraq’s oil currency is censored by the U.S. media as well as the Bush administration & Federal Reserve as the truth could potentially curtail both investor and consumer confidence, reduce consumer borrowing/ spending, create political pressure to form a new energy policy that slowly weans us off middle-eastern oil, and of course stop our march towards war in Iraq. This quasi “state secret” can be found on a Radio Free Europe article discussing Saddam’s switch for his oil sales from dollars to the euros on Nov. 6, 2000 (2). “Baghdad’s switch from the dollar to the euro for oil trading is intended to rebuke Washington’s hard-line on sanctions and encourage Europeans to challenge it. But the political message will cost Iraq millions in lost revenue. RFE/RL correspondent Charles Recknagel looks at what Baghdad will gain and lose, and the impact of the decision to go with the European currency.” At the time of the switch many analysts were surprised that Saddam was willing to give up millions in oil revenue for what appeared to be a political statement. However, contrary to one of the main points of this November 2000 article, the steady depreciation of the dollar versus the euro since late 2001 means that Iraq has profited handsomely from the switch in their reserve and transaction currencies. The euro has gained roughly 17% against the dollar in that time, which also applies to the $10 billion in Iraq’s U.N. “oil for food” reserve fund that was previously held in dollars has also gained that same percent value since the switch. What would happen if OPEC made a sudden switch to euros, as opposed to a gradual transition? “Otherwise, the effect of an OPEC switch to the euro would be that oil-consuming nations would have to flush dollars out of their (central bank) reserve funds and replace these with euros. The dollar would crash anywhere from 20-40% in value and the consequences would be those one could expect from any currency collapse and massive inflation (think Argentina currency crisis, for example). You’d have foreign funds stream out of the U.S. stock markets and dollar denominated assets, there’d surely be a run on the banks much like the 1930s, the current account deficit would become unserviceable, the budget deficit would go into default, and so on. Your basic 3rd world economic crisis scenario. The United States economy is intimately tied to the dollar’s role as reserve currency. This doesn’t mean that the U.S. couldn’t function otherwise, but that the transition would have to be gradual to avoid such dislocations (and the ultimate result of this would probably be the U.S. and the E.U. switching roles in the global economy).” In the aftermath of toppling Saddam it is clear the U.S. will keep a large and permanent military force in the Persian Gulf. Indeed, there is no “exit strategy” in Iraq, as the military will be needed to protect the newly installed Iraqi regime, and perhaps send a message to other OPEC producers that they might receive “regime change” if they too move to euros for their oil exportsâ¤. Another underreported story from this summer regarding the other OPEC ‘Axis of Evil’ country and their interest in the selling oil in euros, Iran. (3) “Iran’s proposal to receive payments for crude oil sales to Europe in euros instead of U.S. dollars is based primarily on economics, Iranian and industry sources said. But politics are still likely to be a factor in any decision, they said, as Iran uses the opportunity to hit back at the U.S. government, which recently labeled it part of an “axis of evil.” The proposal, which is now being reviewed by the Central Bank of Iran, is likely to be approved if presented to the country’s parliament, a parliamentary representative said.”There is a very good chance MPs will agree to this idea …now that the euro is stronger, it is more logical,” the parliamentary representative said.” More over, and perhaps most telling, during 2002 the majority of reserve funds in Iran’s central bank have been shifted to euros. It appears imminent that Iran intends to switch to euros for their oil currency (4) “More than half of the country’s assets in the Forex Reserve Fund have been converted to euro, a member of the Parliament Development Commission, Mohammad Abasspour announced. He noted that higher parity rate of euro against the US dollar will give the Asian countries, particularly oil exporters, a chance to usher in a new chapter in ties with European Union’s member countries. He said that the United States dominates other countries through its currency, noting that given the superiority of the dollar against other hard currencies, the US monopolizes global trade. The lawmaker expressed hope that the competition between euro and dollar would eliminate the monopoly in global trade.” Indeed, after toppling Saddam, this administration may decide that Iran is the next target in the “war on terror.” Iran’s interest in switching to the euro as their standard transaction currency for oil exports is well documented. Perhaps this recent MSNBC article illustrates the objectives of the neo conservatives (5). “While still wrangling over how to overthrow Iraq’s Saddam Hussein, the Bush administration is already looking for other targets. President Bush has called for the ouster of Palestinian leader Yasir Arafat. Now some in the administration⤔and allies at D.C. think tanks⤔are eyeing Iran and even Saudi Arabia. As one senior British official put it: “Everyone wants to go to Baghdad. Real men want to go to Tehran.” Aside from these political risks regarding Saudi Arabia and Iran, another risk factor isactually Japan. Perhaps the biggest gamble in a protracted Iraq war may be Japan’s weak economy (6). If the war creates prolonged oil high prices ($45 per barrel over several months), or a short but massive oil price spike ($80 to $100 per barrel), some analysts believe Japan’s fragile economy would collapse. Japan is quite hypersensitive to oil prices, and if its banks default, the collapse of the second largest economy would set in motion a sequence of events that would prove devastating to the U.S. economy. Indeed, Japan’s fall in an Iraq war could create the economic dislocations that begin in the Pacific Rim but quickly spread to Europe and Russia. The Russian government lacks the controls to thwart a disorderly run on the dollar, and such an event could ultimately force and OPEC switch to euros. Additionally, other risks might arise if the Iraq war goes poorly or becomes prolonged, as it is possible that civil unrest may unfold in Kuwait or other OPEC members including Venezuela, as the latter may switch to euros just as Saddam did in November 2000. Thereby fostering the very situation this administration is trying to prevent, another OPEC member switching to euros as their oil transaction currency. Incidentally, the final “Axis of Evil” country, North Korea, recently decided to officially drop the dollar and begin using euros for trade, effective Dec. 7, 2002 (7). Unlike the OPEC-producers, their switch will have negligible economic impact, but it illustrates the geopolitical fallout of the President Bush’s harsh rhetoric. Much more troubling is North Korea’s recent action following the oil embargo of their country. They are in dire need of oil and food; and in an act of desperation they have re-activated their pre-1994 nuclear program. Processing uranium appears to be taking place at a rapid pace, and it appears their strategy is to prompt negotiations with the U.S. regarding food and oil. The CIA estimates that North Korea could produce 4-6 nuclear weapons by the second half of 2003. Ironically, this crisis over North Korea’s nuclear program further confirms the fraudulent premise for which this war with Saddam was entirely contrived. Unfortunately, neo conservatives such as George Bush, Dick Cheney, Donald Rumsfeld, Paul Wolfowitz and Richard Pearle fail to grasp that Newton’s Law applies equally to both physics and the geo-political sphere as well: “For every action there is an equal but opposite reaction.” During the 1990s the world viewed the U.S. as a rather self-absorbed but essentially benevolent superpower. Military actions in Iraq (90-91′ & 98′), Serbia and Kosovo (99′) were undertaken with both U.N. and NATO cooperation and thus afforded international legitimacy. President Clinton also worked to reduce tensions in Northern Ireland and attempted to negotiate a resolution to the Israeli-Palestinian conflict. However, in both the pre and post 9/11 intervals, the “America first” policies of the Bush administration, with its unwillingness to honor International Treaties, along with their aggressive militarisation of foreign policy, has significantly damaged our reputation abroad. Following 9/11, it appears that President Bush’s “warmongering rhetoric” has created global tensions – as we are now viewed as a belligerent superpower willing to apply unilateral military force without U.N. approval.Lamentably, the tremendous amount of international sympathy that we witnessed in the immediate aftermath of the September 11th tragedy has been replaced with fear and anger at our government. This administration’s bellicosity haschanged the worldview, and “anti-Americanism” is proliferating even among our closest allies (8). Even more alarming, and completely unreported in the U.S media, are some monetary shifts in the reserve funds of foreign governments away from the dollar with movements towards the euro (China, Venezuela, some OPEC producers and last week Russia flushed some of their dollars for euros) (9). It appears that the world community may lack faith in the Bush administration’s economic policies, and along with OPEC, seems poised to respond with economic retribution if the U.S. government is regarded as an uncontrollable and dangerous superpower. The plausibility of abandoning the dollar standard for the euro is growing. An interesting U.K. article outlines the dynamics and the potential outcomes (‘Beyond Bush’s Unilateralism: Another Bi-Polar World or A New Era of Win-Win?’)(10) “The most likely end to US hegemony may come about through a combination of high oil prices (brought about by US foreign policies toward the Middle East) and deeper devaluation of the US dollar (expected by many economists). Some elements of this scenario: 1) US global over-reach in the “war on terrorism” already leading to deficits as far as the eye can see — combined with historically-high US trade deficits – lead to a further run on the dollar. This and the stock market doldrums make the US less attractive to the world’s capital. 2) More developing countries follow the lead of Venezuela and China in diversifying their currency reserves away from dollars and balanced with euros. Such a shift in dollar-euro holdings in Latin America and Asia could keep the dollar and euro close to parity. 3) OPEC could act on some of its internal discussions and decide (after concerted buying of euros in the open market) to announce at a future meeting in Vienna that OPEC’s oil will be re-denominated in euros, or even a new oil-backed currency of their own. A US attack on Iraq sends oil to â,40 per barrel. 4) The Bush Administration’s efforts to control the domestic political agenda backfires. Damage over the intelligence failures prior to 9/11 and warnings of imminent new terrorist attacks precipitate a further stock market slide. 5) All efforts by Democrats and the 57% of the US public to shift energy policy toward renewables, efficiency, standards, higher gas taxes, etc. are blocked by the Bush Administration and its fossil fuel industry supporters. Thus, the USA remains vulnerable to energy supply and price shocks. 6) The EU recognizes its own economic and political power as the euro rises further and becomes the world’s other reserve currency. The G-8 pegs the euro and dollar into a trading band — removing these two powerful currencies from speculators trading screens (a “win-win” for everyone!). Tony Blair persuades Brits of this larger reason for the UK to join the euro. 7) Developing countries lacking dollars or “hard” currencies follow Venezuela’s lead and begin bartering their undervalued commodities directly with each other in computerized swaps and counter trade deals. President Chavez has inked 13 such country barter deals on its oil, e.g., with Cuba in exchange for Cuban health paramedics who are setting up clinics in rural Venezuelan villages. “The result of this scenario? The USA could no longer run its huge current account trade deficits or continue to wage open-ended global war on terrorism or evil. The USA ceases pursuing unilateralist policies. A new US administration begins to return to its multilateralist tradition, ceases its obstruction and rejoins the UN and pursues more realistic international cooperation.” As for the events currently taking place in Venezuela, items #2 and #7 on the above list may allude to why the Bush administration quickly endorsed the failed military-led coup of Hugo Chavez in April 2002. Although the coup collapsed after 2 days, various reports suggest the CIA and a rather embarrassed Bush administration approved and may have been actively involved with the civilian/military coup plotters. (11) “George W. Bush’s administration was the failed coup’s primary loser, underscoring its bankrupt hemispheric policy. Now it is slowly filtering out that in recent months White Houseofficials met with key coup figures, including Carmona. Although the administration insists that it explicitly objected to any extra-constitutional action to remove Chavez, comments by senior U.S. officials did little to convey this.” “The CIA’s role in a 1971 Chilean strike could have served as the working model for generating economic and social instability in order to topple Chavez. In the truckers’ strike of that year, the agency secretly orchestrated and financed the artificial prolongation of a contrived work stoppage in order to economically asphyxiate the leftist Salvador Allende government.” “This scenario would have had CIA operatives acting in liaison with the Venezuelan military, as well as with opposition business and labor leaders, to convert a relatively minor afternoon-long work stoppage by senior management into a nearly successful coup de grace.” Interestingly, according to an article by Michael Ruppert, Venezuelan’s ambassador Francisco Mieres-Lopez apparently floated the idea of switching to the euro as their oil currency standard approximately one year before the failed coup attempt… Furthermore, there is evidence that the CIA is still active in its attempts to overthrow the democratically elected Chavez administration. In fact, this past December a Uruguayan government official recently exposed the ongoing covert CIA operations in Venezuela (12): “Uruguayan EP-FA congressman Jose Bayardi says he has information that far-reaching plan have been put into place by the CIA and other North American intelligence agencies tooverthrow Venezuelan President Hugo Chavez Frias” “Bayardi says he has received copies of top-secret communications between the Bush administration in Washington and the government of Uruguay requesting the latter’s cooperation to support white collar executives and trade union activists to “break down levels of intransigence within the Chavez Frias administration” Venezuela is the fourth largest producer of oil, and the corporate elites whose political power runs unfettered in the Bush/Cheney oligarchy appear interested in privatizing Venezuela’s oil industry. Furthermore, the establishment might be concerned that Chavez’s “barter deals” with 12 Latin American countries and Cuba are effectively cutting the U.S. dollar out of the vital oil transaction currency cycle. Commodities are being traded among these countries in exchange for Venezuela’s oil, thereby reducing reliance on fiat dollars. If these unique oil transactions proliferate, they could create more devaluation pressure on the dollar. Continuing attempts by the CIA to remove Hugo Chavez appear likely. The U.S. economy has acquired several problems, including as our record-high trade account deficit (almost 5% of GDP), $6.3 trillion dollar deficit (55% of GDP), and the recent return to annual budget deficits in the hundreds of billions. These are factors that would devalue the currency of any nation under the “old rules.” Why is the dollar still strong despite these structural flaws? Well, the elites understand that the strength of the dollar does not merely rest on our economic output per se. The dollar posses two unique advantages relative to all other hard currencies. The reality is that the strength of the dollar since 1945 rests on being the international reserve currency and thus fiat currency for global oil transactions (ie. “petro-dollar”). The U.S. prints hundreds of billions of these fiat petro-dollars, which are then used by nation states to purchase oil/energy from OPEC producers (except Iraq, to some degree Venezuela, and perhaps Iran in the near future). These petro-dollars are then re-cycled from OPEC back into the U.S. via Treasury Bills or other dollar-denominated assets such as U.S. stocks, real estate, etc. The “old rules” for valuation of our currency and economic power were based on our flexible market, free flow of trade goods, high per worker productivity, manufacturing output/trade surpluses, government oversight of accounting methodologies (ie. SEC), developed infrastructure, education system, and of course total cash flow and profitability. While many of these factors remain present, over the last two decades we have diluted some of these “safe harbor” fundamentals. Despite imbalances and some structural problems that are escalating within the U.S. economy, the dollar as the fiat oil currency created “new rules”. The following exerts from an Asia Times article discusses the virtues of our fiat oil currency and dollar hegemony (or vices from the perspective of developing nations, whose debt is denominated in dollars). (13) “Ever since 1971, when US president Richard Nixon took the dollar off the gold standard (at $35 per ounce) that had been agreed to at the Bretton Woods Conference at the end of World War II, the dollar has been a global monetary instrument that the United States, and only the United States, can produce by fiat. The dollar, now a fiat currency, is at a 16-year trade-weighted high despite record US current-account deficits and the status of the US as the leading debtor nation. The US national debt as of April 4 was $6.021 trillion against a gross domestic product (GDP) of $9 trillion.” “World trade is now a game in which the US produces dollars and the rest of the world produces things that dollars can buy. The world’s interlinked economies no longer trade to capture a comparative advantage; they compete in exports to capture needed dollars to service dollar-denominated foreign debts and to accumulate dollar reserves to sustain the exchange value of their domestic currencies.To prevent speculative and manipulative attacks on their currencies, the world’s central banks must acquire and hold dollar reserves in corresponding amounts to their currencies in circulation. The higher the market pressure to devalue a particular currency, the more dollar reserves its central bank must hold. This creates a built-in support for a strong dollar that in turn forces the world’s central banks to acquire and hold more dollar reserves, making it stronger. This phenomenon is known as dollar hegemony, which is created by the geopolitically constructed peculiarity that critical commodities, most notably oil, are denominated in dollars. Everyone accepts dollars because dollars can buy oil. The recycling of petro-dollars is the price the US has extracted from oil-producing countries for US tolerance of the oil-exporting cartel since 1973.” “By definition, dollar reserves must be invested in US assets, creating a capital-accounts surplus for the US economy. Even after a year of sharp correction, US stock valuation is still at a 25-year high and trading at a 56 percent premium compared with emerging markets.””The US capital-account surplus in turn finances the US trade deficit. Moreover, any asset, regardless of location, that is denominated in dollars is a US asset in essence. When oil is denominated in dollars through US state action and the dollar is a fiat currency,the US essentially owns the world’s oil for free. And the more the US prints greenbacks, the higher the price of US assets will rise. Thus a strong-dollar policy gives the US a double win.” This unique geo-political agreement with Saudi Arabia has worked to our favor for the past 30 years, as this arrangement has raised the entire asset value of all dollar denominated assets/properties, and allowed the Federal Reserve to create a truly massive debt and credit expansion (or ‘credit bubble’ in the view of some economists). These current structural imbalances in the U.S. economy are sustainable as long as: 1)Nations continue to demand and purchase oil for their energy/survival needs 2)The fiat reserve currency for global oil transactions remain the U.S. dollar (and dollar only) These underlying factors, along with the “safe harbor” reputation of U.S. investments afforded by the dollar’s reserve currency status propelled the U.S. to economic and military hegemony in the post-World War II period. However, the introduction of the euro is a significant new factor, and appears to be the primary threat to U.S. economic hegemony. More over, in December 2002 ten additional countries were approved for full membership into the E.U. In 2004 this will result in an aggregate GDP of $9.6 trillion and 450 million people, directly competing with the U.S. economy ($10.5 trillion GDP, 280 million people). Especially interesting is a speech given by Mr Javad Yarjani, the Head of OPEC’s Petroleum Market Analysis Department, in a visit to Spain (April 2002). He speech dealt entirely on the subject of OPEC oil transaction currency standard with respect to both the dollar and the euro. The following exerts from this OPEC executive provide insights into the conditions that would create momentum for an OPEC currency switch to the euro. Indeed, his candid analysis warrants careful consideration given that two of the requisite variables he outlines for the switch have taken place since this speech in early 2002. These vital stories are discussed in the European media, but have been censored by our own mass media (14) “The question that comes to mind is whether the euro will establish itself in world financial markets, thus challenging the supremacy of the US dollar, and consequently trigger a change in the dollar’s dominance in oil markets. As we all know, the mighty dollar has reigned supreme since 1945, and in the last few years has even gained more ground with the economic dominance of the United States, a situation that may not change in the near future. By the late 90s, more than four-fifths of all foreign exchange transactions, and half of all world exports, were denominated in dollars. In addition, the US currency accounts for about two thirds of all official exchange reserves. The world’s dependency on US dollars to pay for trade has seen countries bound to dollar reserves, which are disproportionably higher than America’s share in global output. The share of the dollar in the denomination of world trade is also much higher than the share of the US in world trade. Having said that, it is worthwhile to note that in the long run the euro is not at such a disadvantage versus the dollar when one compares the relative sizes of the economies involved, especially given the EU enlargement plans. Moreover, the Euro-zone has a bigger share of global trade than the US and while the US has a huge current account deficit, the euro area has a more, or balanced, external accounts position. One of the more compelling arguments for keeping oil pricing and payments in dollars has been that the US remains a large importer of oil, despite being a substantial crude producer itself. However, looking at the statistics of crude oil exports, one notes that the Euro-zone is an even larger importer of oil and petroleum products than the US.” “From the EU’s point of view, it is clear that Europe would prefer to see payments for oil shift from the dollar to the euro, which effectively removed the currency risk. It would also increase demand for the euro and thus help raise its value. Moreover, since oil is such an important commodity in global trade, in term of value, if pricing were to shift to the euro, it could provide a boost to the global acceptability of the single currency. There is also very strong trade links between OPEC Member Countries (MCs) and the Euro-zone, with more than 45 percent of total merchandise imports of OPEC MCs coming from the countries of the Euro-zone, while OPEC MCs are main suppliers of oil and crude oil products to Europe.” “Of major importance to the ultimate success of the euro, in terms of the oil pricing, will be if Europe’s two major oil producers ⤔ the United Kingdom and Norway join the single currency. Naturally, the future integration of these two countries into the Euro-zone and Europe will be important considering they are the region’s two major oil producers in the North Sea, which is home to the international crude oil benchmark, Brent. This might create a momentum to shift the oil pricing system to euros.” “In the short-term, OPEC MCs, with possibly a few exceptions, are expected to continue to accept payment in dollars. Nevertheless, I believe that OPEC will not discount entirely the possibility of adopting euro pricing and payments in the future. The Organization, like many other financial houses at present, is also assessing how the euro will settle into its life as a new currency. The critical question for market players is the overall value and stability of the euro, and whether other countries within the Union will adopt the single currency.” Should the euro challenge the dollar in strength, which essentially could include it in the denomination of the oil bill, it could be that a system may emerge which benefits more countries in the long-term. Perhaps with increased European integration and a strong European economy, this may become a reality. Time may be on your side. I wish the euro every success.” Based on this important speech, momentum for OPEC to consider switching to the euro will grow once the E.U. expands in May 2004 to 450 million people with the inclusion of 10 additional member states. The aggregate GDP will increase from $7 trillion to $9.6 trillion. This enlarged E.U. will be an oil consuming purchasing population 33% larger than the U.S., and over half of OPEC crude oil will be sold to the EU as of mid-2004. This does not include other potential entrants such as the U.K., Norway, Denmark and Sweden. I should note that since this speech the euro has been trading at parity or above the dollar since late 2002, and analysts predict the dollar will continue its downward trending in 2003 relative to the euro. Further, if or when the U.K. adopts the euro currency, that development could provide critical motivation for OPEC to the make the transition to euros. It appears the final two pivotal items that would create the OPEC transition to euros will be based on if and when Norway’s Brent crude is re-dominated in euros, and when the U.K. adopts the euro. Regarding the later, Tony Blair is lobbying heavily for the U.K. to adopt the euro, and their adoption would seem imminent within this decade. Again, I offer the following information from my astute acquaintance who analyzes these matters very carefully regarding the euro: “The pivotal vote will probably be Sweden, where approval this next autumn of adopting the euro also would give momentum to the Danish government’s strong desire to follow suit. Polls in Denmark now indicate that the euro would pass with a comfortable margin and Norwegian polls show a growing majority in favor of EU membership. Indeed, with Norway having already integrated most EU economic directives through the EEA partnership and with their strongly appreciated currency, their accession to the euro would not only be effortless, but of great economic benefit. As go the Swedes, so probably will go the Danes & Norwegians. It’s the British who are the real obstacle to building momentum for the euro as international transaction & reserve currency. So long as the United Kingdom remains apart from the euro, reducing exchange rate costs between the euro and the British pound remains their obvious priority. British adoption (a near-given in the long run) would mount significant pressure toward repegging the Brent crude benchmark – which is traded on the International Petroleum Exchange in London – and the Norwegians would certainly have no objection whatsoever that I can think of, whether or not they join the European Union.” Finally, the maneuvers toward reducing the global dominance of the dollar are already well underway and have only reason to accelerate so far as I can see. An OPEC pricing shift would seem rather unlikely prior 2004 – barring political motivations (ie. motivations of OPEC members) or a disorderly collapse of the dollar (ie. prolonged high oil prices due to Iraq war causes Japanese bank collapse)- but appears quite viable to take place before the end of the decade.” In otherwords, around 2005, from an economic and monetary perspectivem, it will be logical for OPEC to switch to the euro for oil pricing. Of course that will devalue the dollar, and hurt the US economy unless it begins making some structual changes – or use its massive military power to force events upon the OPEC states… Facing these potentialities, I hypothesize that President Bush intends to topple Saddam in 2003 in a pre-emptive attempt to initiate massive Iraqi oil production in far excess of OPEC quotas, to reduce global oil prices, and thereby dismantle OPEC’sprice controls. The end-goal of the neo-conservatives is incredibly bold yet simple in purpose, to use the “war on terror” as the premise to finally dissolve OPEC’s decision-making process, thus ultimately preventing the cartel’s inevitable switch to pricing oil in euros. How would the Bush administration break-up the OPEC cartel’s price controls in a post-Saddam Iraq? First, the newly installed regime (apparently a U.S. General for the first several months) will convert Iraq back to the dollar standard. Next, with the U.S. military protecting the oil fields, the Bush junta will undertake the necessary steps to rapidly increase production of Iraq oil, quintupling Iraq’s current output – and well beyond OPEC’s 2 million barrel per day quota. Dr. Nayyer Ali offers a succinct analysis of how Iraq’s underutilized oil reserves will not be a “profit-maker” for the U.S. government, but it will serve as the crucial economic instrument used by the Bush junta to leverage and hopefully dissolve OPEC’s price controls, thus causing the neo conservative’s long sought goal of collapsing the OPEC cartel (15): “Despite this vast pool of oil, Iraq has never produced at a level proportionate to the reserve base. Since the Gulf War, Iraq’s production has been limited by sanctions and allowed sales under the oil for food program (by which Iraq has sold 60 billion dollars worth of oil over the last 5 years) and what else can be smuggled out. This amounts to less than 1 billion barrels per year. If Iraq were reintegrated into the world economy, it could allow massive investment in its oil sector and boost output to 2.5 billion barrels per year, or about 7 million barrels a day. Total world oil production is about 75 million barrels, and OPEC combined produces about 25 million barrels. What would be the consequences of this? There are two obvious things. First would be the collapse of OPEC, whose strategy of limiting production to maximize price will have finally reached its limit. An Iraq that can produce that much oil will want to do so, and will not allow OPEC to limit it to 2 million barrels per day. If Iraq busts its quota, then who in OPEC will give up 5 million barrels of production? No one could afford to, and OPEC would die. This would lead to the second major consequence, which is a collapse in the price of oil to the 10-dollar range per barrel. The world currently uses 25 billion barrels per year, so a 15-dollar drop will save oil-consuming nations 375 billion dollars in crude oil costs every year.” “The Iraq war is not a moneymaker. But it could be an OPEC breaker. That however is a long-term outcome that will require Iraq to be successfully reconstituted into a functioning state in which massive oil sector investment can take place.” The American people are largely oblivious to the economic risks regarding President Bush’s upcoming war. Not only is Japan’s economy at grave risk from a spike in oil prices, but additional risks relate to Iran and Venezuela as well, either of whom could move to the euros, thus providing further momentum for OPEC to act on their “internal discussions” and switch to the euro as the fiat currency for oil. The Bush administration believes that by toppling Saddam they will remove the juggernaut, thus allowing the US to control Iraqi’s huge oil reserves, and finally break-up and dissolve the 10 remaining countries in OPEC. This last issue is undoubtedly a significant gamble even in the best-case scenario of a quick and relatively painless war that topples Saddam and leaves Iraq’s oil fields intact. Undoubtedly, the OPEC cartel could feel threatened by the Bush junta’s stated goal of breaking-up OPEC’s price controls ($22-$28 per barrel). Perhaps the Bush administration’s ambitious goal of flooding the oil market with Iraqi crude may work, but I have doubts. Will OPEC simply tolerate quota-busting Iraqi oil production, thus delivering to them a lesson in self-inflicted hara-kiri (suicide)? Contrarily, OPEC could meet in Vienna and in an act of self-preservation re-denominate the oil currency to the euro. Such a decision by would mark the end of U.S. dollar hegemony, and thus the end of our precarious economic superpower status. Again, I offer the astute analysis of my expert friend regarding the colossal gamble this administration is about to undertake: “One of the dirty little secrets of today’s international order is that the rest of the globe could topple the United States from its hegemonic status whenever they so choose with a concerted abandonment of the dollar standard. This is America’s preeminent, inescapable Achilles Heel for now and the foreseeable future. That such a course hasn’t been pursued to date bears more relation to the fact that other Westernized, highly developed nations haven’t any interest to undergo the great disruptions which would follow – but it could assuredly take place in the event that the consensus view coalesces of the United States as any sort of ‘rogue’nation. In other words, if the dangers of American global hegemony are ever perceived as a greater liability than the dangers of toppling the international order (or, alternately, if an ‘every man for himself’ crisis as discussed above spirals out of control and forces their hand). The Bush administration and the neo conservative movement has set out on a multiple-front course to ensure that this cannot take place, in brief by a graduated assertion of military hegemony atop the existent economic hegemony. The paradox I’ve illustrated with this one narrow scenario is that the quixotic course itself may very well bring about the feared outcome that it means to preempt. We shall see!” Under this administration we have returned to massive deficit spending, and the lack of strong SEC enforcement has further eroded investor confidence. Regrettably, the flawed economic and tax policies and of the Bush administration may be exacerbating the weakness of the dollar, if not outright accelerating some countries to diversify their central bank reserve funds with euros as an alternative to the dollar. >From a foreign policy perspective, the terminations of numerous international treaties and disdain for international cooperation via the UN and NATO have angered even our closest allies. Lastly, and despite President Bush’s attempt to use the threat of applying military force to OPEC producers who may wish to switch to the euro for their oil payments, it appears their belligerent neo conservative policies may paradoxically bring about the dire outcome they hope to prevent – an OPEC currency switch to euros. The American people are not aware of such information due to the U.S. mass media, which has been reduced to a handful of consumption/entertainment and profit-oriented conglomerates that filter the flow of information in the U.S. Indeed, the Internet provides the only source of unfiltered “real news.” Synopsis: It would appear that any attempt by OPEC member states in the Middle East or Latin America to transition to the euro as their oil transaction currency standard shall be met with either overt U.S. military actions or covert U.S. intelligence agency interventions. Under the guise of the perpetual “war on terror” the Bush administration is manipulating the American people about the unspoken but very real macroeconomic reasons for this upcoming war with Iraq. This war in Iraq will have nothing to with any threat from Saddam’s old WMD program. This war will be over the global currency of oil. Sadly, the U.S. has become largely ignorant and complacent. Too many of us are willing to be ruled by fear and lies, rather than by persuasion and truth. Will we allow our government to initiate the dangerous “pre-emptive doctrine” by waging an unpopular war in Iraq, while we refuse to acknowledge that Saddam does not pose an imminent threat to the United States? We seem unable to address the structural weakness of our economy due to massive debt manipulation, unaffordable 2001 tax cuts, massive current account deficits, trade deficits, corporate accounting abuses, unsustainable credit expansion, near zero personal savings, record personal indebtedness, and our dependence and over consumption of cheap Middle Eastern oil. How much longer can we reliably import our oil from middle eastern states that dislike or despise us because of our biased foreign policy towards Israel? Lastly, we must bear in mind Jefferson’s insistence that a free press is our best, and perhaps only mechanism to protect democracy, and part of today’s dilemma lies within the U.S. media conglomerates that have failed to inform the People. Regardless of whatever Dr. Blix finds or doesn’t find in Iraq regarding WMD, it appears that President Bush is determined to pursue his “pre-emptive” imperialist war to secure a large portion of the earth’s remaining hydrocarbons, and then use Iraq’s underutilized oil to destroy the OPEC cartel. Will this gamble work? Undeniably our nation may suffer not only from economic retribution, but also from increased Al-Qaeda sponsored terrorism as well. Will we stand idle and watch CNN, as our government becomes an international pariah by discarding International Law as it wages a unilateral war in Iraq? Is it morally defensible to deploy our brave but naÃve young soldiers around the globe to enforce U.S. dollar hegemony for global oil transactions – via the barrel of their guns? Will we allow imperialist conquest in the Middle East to feed our excessive energy consumption, while ignoring the duplicitous overthrowing of a democratically elected government in Latin America? Shall we accept the grave price of an unjust war over the currency of oil? We must not stand silent and watchour country become a ‘rogue’ superpower, relying on brute force, thereby forcing the industrialized nations or OPEC to abandon the dollar standard – thus with the mere stroke of a pen – slay the U.S. Empire? Informed citizens believe this administration is pushing us towards that dire outcome. Remaining silent is not only misguided, but false patriotism. This need not be our fate. When will we demand that our government begin the long and difficult journey towards energy conservation, the development of renewable energy sources, and sustained balanced budgets to allow real deficit reduction? When will we repeal of the unaffordable 2001 tax cuts to create a balanced budget, enforce corporate accounting laws, and substantially reinvest in our manufacturing and export sectors to move our economy from a trade account deficit position back into a trade account surplus position? Undoubtedly, we must make these and many more painful structural changes to our economy if we are to restore our “safe harbor” investment status. Ultimately we will have to make sacrifices by reducing our excessive energy consumption that we have become accustomed to as a society. It is imperative that our government also begins economic and monetary reforms immediately. We must adopt our economy to accommodate the inevitable competition to the dollar from the euro as an alternative international reserve currency and oil transaction currency. The Bush administration’s seemingly entrenched political ideology appears quite incompatible with these necessary economic reforms. Ultimately We the People must demand a new and more responsible administration. We need leaders who are willing to return balanced, conservative fiscal policies, and to our traditions of engaging in multilateral foreign policies while seeking broad international cooperation. It has been said that all wars are fought over resources or ideology/religion. It appears that this administration may soon add “currency wars” as a third paradigm. I fear that the world community will not tolerate a U.S. Empire that uses its military power to conquer sovereign nations who decide to sell their oil products in euros instead of dollars. Likewise, if President Bush pursues an essentially unilateral war against Iraq, I suspect the historians will not be kind to his administration. Their agenda is clear to the world community, but when will U.S. patriots become cognizant of their modus operandi? “If you tell a lie big enough and keep repeating it, people will eventually come to believe it.” “The lie can be maintained only for such time as the State can shield the people from the political, economic and/or military consequences of the lie. It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy of the State.” – Joseph Goebbels, German Minister of Propaganda, 1933-1945 END OF ESSAY

+

Background Information on Hydrocarbons To understand hydrocarbons and how we got to this desperate place in Iraq, I have listed four articles in the Reference Section from Michael Ruppert’s controversial website: ‘From the Wilderness.’ Although some of Ruppert’s articles are overwrought from time to time, their research detailing the issues of hydrocarbons, and the interplay between energy and the Bush junta’s perpetual “war on terror” is quite informative. Other than the core driver of the dollar versus euro currency threat, the other issue related to the upcoming war with Iraq appears related to the Caspian Sea region. Since the mid-late 1990s the Caspian Sea region of Central Asiawas thought to hold approx. 200 billion barrels of untapped oil (the later would be comparable to Saudi Arabia’s reserve base)(16). Based on an early feasibility study by Enron, the easiest and cheapest way to bring this oil to market would be a pipeline from Kazakhstan, through Afghanistan to the Pakistan border at Malta. In 1998 then CEO of Halliburton, Dick Cheney, expressed much interest in building that pipeline. In fact, these oil reserves were a *central* component of Vice President Cheney’s energy plan released in May 2001. According to his report, the U.S. will import 90% of its oil by 2020, and thus tapping into the reserves in the Caspian Sea region was viewed as a strategic goal that would help meet our growing energy demand, and also reduce our dependence on oil from the Middle East (17). According to the French book, The Forbidden Truth (18), the Bush administration ignored the U.N. sanctions that had been imposed upon the Taliban and entered into negotiations with the supposedly ‘rogue regime’ from February 2, 2001 to August 6, 2001. According to this book, the Taliban were apparently not very cooperative based on the statements of Pakistan’s former ambassador, Mr. Naik. He reports that the U.S. threatened a “military option” in the summer of 2001 if the Taliban did not acquiesce to our demands. Fortuitous for the Bush administration and Cheney’s energy plan, Bin Laden delivered to us 9/11. The pre-positioned U.S. military; along with the CIA providing cash to the Northern Alliance leaders, led the invasion of Afghanistan and the Taliban were routed. The pro-western Karzai government was ushered in. The pipeline project was now back on track in early 2002, well, sort… After three exploratory wells were built and analyzed, it was reported that the Caspian region holds only approximately 10 to 20 billion barrels of oil (although it does have a lot of natural gas) (16). The oil is also of poor quality, with high sulfur content. Subsequently, several major companies have now dropped their plans for the pipeline citing the massive project was no longer profitable. Unfortunately, this recent realization about the Caspian Sea region has serious implications for the U.S., India, China, Asia and Europe, as the amount of available hydrocarbons for industrialized and developing nations has been decreased downward by 20%. (Globalestimates reduced from 1.2 trillion to approx. 1 trillion) (18, 19). The Bush administration quickly turned its attention to a known quantity, Iraq, with it proven reserves totaling 11% of the world’s oil reserves. Our greatest nemesis, Bin Laden, was quickly replaced with our new public enemy #1, Saddam Hussein… For those who would like to review the impact of depleting hydrocarbon reserves from the geo-political perspective, and the potential ramifications to how this may ultimately create an erosion of our civil liberties and democratic processes, retired U.S. Special Forces officer Stan Goff offers a sobering analysis in his essay: ‘The Infinite War and Its Roots’ (20). Likewise, for those who wish to review the unspeakable evidence surrounding the September 11th tragedy, the controversial essay “The Enemy Within” by the famous American writer Gore Vidal offers a thorough introduction. Although published in Italy and a major UK newspaper, The Observer, you will not read Gore Vidal’s controversial essay in the U.S. media. Note: Gore Vidal’s latest book, ‘Dreaming War’ features this as the opening essay (21). Finally, ‘The War on Freedom” by British political scientist Nafeez Ahmed asks disconcerting questions about the 9/11 tragedy (22). FOOTNOTES (1)London, Heidi Kingstone, ‘Middle East: Trouble in the House of Saud’ (January 13, 2003) http://www.jrep.com/Mideast/Article-0.html (2)Recknagel, Charles, ‘Iraq: Baghdad Moves to Euro’ (November 1, 2000) http://www.rferl.org/nca/features/2000/11/01112000160846.asp (3)Gutman, Roy & Barry, John, Beyond Baghdad: Expanding Target List: Washington looks at overhauling the Islamic and Arab world (August 11, 2002) http://www.unansweredquestions.net/timeline/2002/newsweek081102.html (4)’Economics Drive Iran Euro Oil Plan, Politics Also Key’ (August 2002) http://www.iranexpert.com/2002/economicsdriveiraneurooil23august.htm (5)’Forex Fund Shifting to Euro,’ Iran Financial News, (August 25, 2002) http://www.payvand.com/news/02/aug/1080.html (6)Costello, Tom, ‘Japan’s Economy at Risk of Collapse’ (December 11, 2002) http://www.msnbc.com/news/845708.asp?0cl=cR (7) Gluck, Caroline, ‘North Korea embraces the euro’ (December 1, 2002) http://news.bbc.co.uk/1/hi/world/asia-pacific/2531833.stm (8) ‘What the World Thinks in 2002 : How Global Publics View: Their Lives, Their Countries, The World, America’ (2002) http://people-press.org/reports/display.php3?ReportID5 (9) ‘Euro continues to extend its global influence’ (January 7, 2002) http://www.europartnership.com/news/02jan07.htm (10) Henderson, Hazel, ‘Beyond Bush’s Unilateralism: Another Bi-Polar World or A New Era of Win-Win?’ (June 2002) http://www.hazelhenderson.com/Bush’s%20unilateralism.htm (11) Birms, Larry & Volberding, Alex, ‘U.S. is the Primary Loser in Failed Venezuelan Coup,’ Newsday (April 21, 2002) http://www.coha.org/COHA%20_in%20_the_news/ Articles%202002/newsday_04_21_02_us__venezuela.htm (12) ‘USA intelligence agencies revealed in plot to oust Venezuela’s President,’ (Dec 12, 2002) http://www.vheadline.com/0212/14248.asp (link now dead) (13) Liu, Henry C K, ‘US Dollar hegemony has got to go,’ (Asia Times, April 11, 2002) http://www.atimes.com/global-econ/DD11Dj01.html (14) ‘The Choice of Currency for the Denomination of the Oil Bill,’ Speech given by Javad Yarjani, Head of OPEC’s Marketing Analysis Department (April, 2002) http://www.opec.org/NewsInfo/Speeches/sp2002/spAraqueSpainApr14.htm (15) Dr. Ali, Nayyer, ‘Iraq and Oil,’ (December 13, 2002) http://www.pakistanlink.com/nayyer/12132002.html (16) Pfeiffer, Dale, ‘Much Ado about Nothing — Whither the Caspian Riches? ‘ (December 5, 2002) http://www.fromthewilderness.com/free/ww3/120502_caspian.html (17) Ruppert, Michael, ‘The Unseen Conflict,’ (October 18, 2002) http://www.fromthewilderness.com/free/ww3/101802_the_unseen.html (18) Jean Charles-Briscard & Guillaume Dasquie, ‘The Forbidden Truth: U.S.-Taliban Secret Oil Diplomacy, Saudi Arabia and the Failed Search for bin Laden’, Nation Books, 2002. (19) Ruppert, Michael, ‘Colin Campbell on Oil.'(October 23, 2002) http://www.fromthewilderness.com/free/ww3/102302_campbell.html (20) Golf, Stan, ‘The Infinite War and its Roots,’ http://www.fromthewilderness.com/free/ww3/082702_infinite_war.html (21) Vidal, Gore, ‘Dreaming War: Blood for Oil & the Cheney-Bush Junta,’ Nation Books, 2002. His essay, ‘The Enemy Within’ was first printed in the UK’s Observer (Oct 27, 2002) http://www.ratical.org/ratville/CAH/EnemyWithin.html (22) Ahmed, Nafeez, ‘The War on Freedom: How and Why America was Attacked, September 11, 2001’, Tree of Life Publications, 2002.

Whatever the reasons, it is clear that this trend is growing. A government that doesn’t heed these warnings runs the risk of reaching a Tipping Point (hi Lance!) where insurgent ideas lead to insurgent behaviour, on a global scale. That would make 9-11-01 look like an appetizer.

-Ian.

—- http://people-press.org/reports/display.php3?ReportID5

What the World Thinks in 2002 How Global Publics View: Their Lives, Their Countries, The World, America

Released: December 4, 2002

Global Gloom and Growing Anti-Americanism

Despite an initial outpouring of public sympathy for America following the September 11, 2001 terrorist attacks, discontent with the United States has grown around the world over the past two years. Images of the U.S. have been tarnished in all types of nations: among longtime NATO allies, in developing countries, in Eastern Europe and, most dramatically, in Muslim societies.

Since 2000, favorability ratings for the U.S. have fallen in 19 of the 27 countries where trend benchmarks are available. While criticism of America is on the rise, however, a reserve of goodwill toward the United States still remains. The Pew Global Attitudes survey finds that the U.S. and its citizens continue to be rated positively by majorities in 35 of the 42 countries in which the question was asked. True dislike, if not hatred, of America is concentrated in the Muslim nations of the Middle East and in Central Asia, today’s areas of greatest conflict.

Opinions about the U.S., however, are complicated and contradictory. People around the world embrace things American and, at the same time, decry U.S. influence on their societies. Similarly, pluralities in most of the nations surveyed complain about American unilateralism. But the war on terrorism, the centerpiece of current U.S. foreign policy, continues to enjoy global support outside the Muslim world.

While attitudes toward the United States are most negative in the Middle East/Conflict Area, ironically, criticisms of U.S. policies and ideals such as American-style democracy and business practices are also highly prevalent among the publics of traditional allies. In fact, critical assessments of the U.S. in countries such as Canada, Germany and France are much more widespread than in the developing nations of Africa and Asia.

A follow-up six-nation survey finds a wide gap in opinion about a potential war with Iraq. This threatens to further fuel anti-American sentiment and divide the United States from the publics of its traditional allies and new strategic friends. But even on this highly charged issue, opinions are nuanced. Iraq is seen as a threat to regional stability and world peace by overwhelming numbers of people in allied nations, yet American motives for using force against Iraq are still suspect.

Souring attitudes toward America are more than matched by the discontent that people of the planet feel concerning the world at large. As 2002 draws to a close, the world is not a happy place. At a time when trade and technology have linked the world more closely together than ever before, almost all national publics view the fortunes of the world as drifting downward. A smaller world, our surveys indicate, is not a happier one.

The spread of disease is judged the top global problem in more countries than any other international threat, in part because worry about AIDS and other illnesses is so overwhelming in developing nations, especially in Africa. Fear of religious and ethnic violence ranks second, owing to strong worries about global and societal divisions in both the West and in several Muslim countries. Nuclear weapons run a close third in public concern. The publics of China, South Korea and many in the former Soviet Bloc put more emphasis on global environmental threats than do people elsewhere.

Dissatisfaction with the state of one’s country is another common global point of view. In all but a handful of societies, the public is unhappy with national conditions. The economy is the number one national concern volunteered by the more than 38,000 respondents interviewed. Crime and political corruption also emerge as top problems in most of the nations surveyed. Both issues even rival the importance of the spread of disease to the publics of AIDS-ravaged African countries.

These are among the principal findings of the Pew Global Attitudes survey, conducted in 44 nations to assess how the publics of the world view their lives, their nation, the world and the United States. This is the first major report on this survey. The second will detail attitudes toward globalization, modernization, social attitudes and democratization. The International Herald Tribune is our global newspaper partner and conducted in-depth interviews with citizens in five nations, some of which are quoted in this report.

The primary survey was conducted over a four-month period (July-October 2002) among over 38,000 respondents. It was augmented with a separate, six-nation survey in early November, which examined opinion concerning a possible U.S. war with Iraq.

Follow-Up Survey on Iraq

Huge majorities in France, Germany and Russia oppose the use of military force to end the rule of Saddam Hussein. The British public is evenly split on the issue. More than six-in-ten Americans say they would back such an action. But the six-nation poll finds a significant degree of agreement in Europe that Iraq is a threat to the stability of the Middle East and to world peace. More people in all countries polled say the current Iraqi regime poses a danger to peace than say the same about either North Korea or Iran.

Majorities in Great Britain, Germany and France also agree with Americans that the best way to deal with Saddam is to remove him from power rather than to just disarm him. However, the French, Germans and Russians see the conflict between the Israelis and Palestinians as a greater threat to stability in the Middle East than Saddam’s continued rule. The American and British publics both worry more about Iraq than the Israeli-Palestinian conflict.

Turkish respondents differ from Europeans about the danger posed by Iraq. They are divided on whether the regime in Baghdad is a threat to the stability of the region, and just a narrow 44% plurality thinks Saddam Hussein should be removed from power.

Fully 83% of Turks oppose allowing U.S. forces to use bases in their country, a NATO ally, to wage war on Iraq. Further, a 53% majority of Turkish respondents believe the U.S. wants to get rid of Saddam as part of a war against unfriendly Muslim countries, rather than because the Iraqi leader is a threat to peace.

While Europeans view Saddam as a threat, they also are suspicious of U.S. intentions in Iraq. Large percentages in each country polled think that the U.S. desire to control Iraqi oil is the principal reason that Washington is considering a war against Iraq. In Russia 76% subscribe to a war-for-oil view; so too do 75% of the French, 54% of Germans, and 44% of the British. In sharp contrast, just 22% of Americans see U.S. policy toward Iraq driven by oil interests. Two-thirds think the United States is motivated by a concern about the security threat posed by Saddam Hussein.

In addition, respondents in the five nations surveyed (aside from the U.S.) express a high degree of concern that war with Iraq will increase the risk of terrorism in Europe. Two-thirds of those in Turkey say this, as do majorities in Russia, France, Great Britain and Germany. By comparison, 45% of Americans are worried that war will raise the risk of terrorist attacks in the U.S.

Suspicions about U.S. motives in Iraq are consistent with criticisms of America apparent throughout the Global Attitudes survey. The most serious problem facing the U.S. abroad is its very poor public image in the Muslim world, especially in the Middle East/Conflict Area. Favorable ratings are down sharply in two of America’s most important allies in this region, Turkey and Pakistan. The number of people giving the United States a positive rating has dropped by 22 points in Turkey and 13 points in Pakistan in the last three years. And in Egypt, a country for which no comparative data is available, just 6% of the public holds a favorable view of the U.S.

The war on terrorism is opposed by majorities in nearly every predominantly Muslim country surveyed. This includes countries outside the Middle East/Conflict Area, such as Indonesia and Senegal. The principal exception is the overwhelming support for America’s anti-terrorist campaign found in Uzbekistan, where the United States currently has 1,500 troops stationed.

Sizable percentages of Muslims in many countries with significant Muslim populations also believe that suicide bombings can be justified in order to defend Islam from its enemies. While majorities see suicide bombing as justified in only two nations polled, more than a quarter of Muslims in another nine nations subscribe to this view.

U.S. image problems are not confined to Muslim countries. The worldwide polling conducted throughout the summer and fall finds few people, even in friendly nations, expressing a very favorable opinion of America, and sizable minorities in Western Europe and Canada having an unfavorable view. Many people around the world, especially in Europe and the Middle East/Conflict Area, believe the U.S. does not take into account the interests of their country when making international policies. Majorities in most countries also see U.S. policies as contributing to the growing gap between rich and poor nations and believe the United States does not do the right amount to solve global problems.

U.S. global influence is simultaneously embraced and rejected by world publics. America is nearly universally admired for its technological achievements and people in most countries say they enjoy U.S. movies, music and television programs. Yet in general, the spread of U.S. ideas and customs is disliked by majorities in almost every country included in this survey. This sentiment is prevalent in friendly nations such as Canada (54%) and Britain (50%), and even more so in countries where America is broadly disliked, such as Argentina (73%) and Pakistan (81%).

Similarly, despite widespread resentment toward U.S. international policies, majorities in nearly every country believe that the emergence of another superpower would make the world a more dangerous place. This view is shared even in Egypt and Pakistan, where no more than one-in-ten have a favorable view of the U.S. And in Russia, a 53% majority believes the world is a safer place with a single superpower.

The American public is strikingly at odds with publics around the world in its views about the U.S. role in the world and the global impact of American actions. In contrast to people in most other countries, a solid majority of Americans surveyed think the U.S. takes into account the interests of other countries when making international policy. Eight-in-ten Americans believe it is a good thing that U.S. ideas and customs are spreading around the world. The criticism that the U.S. contributes to the gap between rich and poor nations is the only negative sentiment that resonates with a significant percentage of Americans (39%).

Global Discontents

In most countries surveyed, people rate the quality of their own life much higher than the state of their nation; similarly, their rating of national conditions is more positive than their assessment of the state of the world. Even so, the survey finds yawning gaps in perceptions dividing North America and Western Europe from the rest of the world.

Americans and Canadians judge their lives better than do people in the major nations of Western Europe. But that gap is minimal when the publics of the West are contrasted with people in other parts of the world.

Asians, South Koreans excepted, are less satisfied with their lives than are Western publics. Personal contentment is especially low among Chinese and Indian respondents, and relatively few feel they have made personal progress over the past five years. Nevertheless, the Chinese and Indians are extremely optimistic about their futures. In fact, many people in Asia expect their lives to get better. This is the case in the Philippines, Vietnam, South Korea and Indonesia. The Chinese and the Vietnamese, in particular, have great confidence that their children will lead better lives than they have. By contrast, the Japanese are among the gloomiest people in Asia, whether reflecting on the past, present or the future.

[….]

———–

-Ian.

—- http://www.villagevoice.com/issues/0133/ridgeway.php

Mondo Washington by James Ridgeway with Ariston-Lizabeth Anderson and Sandra Bisin Manhattan’s Milosevic How You Can Do What the Government Won’t: Arrest Henry Kissinger August 15 – 21, 2001

You might have to be crazy. Or at least foolhardy. But you could try to bring Henry Kissinger to justice for crimes against humanity. Consider, though, what happened to the last people to talk even jokingly about plans for a citizen’s arrest of the real-life model for Dr. Strangelove.

It happened 30 years ago, when Kissinger was at his Strangelovian heights. A group of anti-war protesters sought to raise the spirits of that estimable Catholic priest Phil Berrigan, then in prison for destroying draft records. The group got drunk one night, as Daniel Ellsberg recalls, and dashed off a letter to Berrigan humorously suggesting they nab Kissinger for war crimes in Vietnam. Prison authorities intercepted the mail and the FBI swooped down, charging the writers with conspiracy to kidnap the secretary of state. Dubbed the Harrisburg 6, the friends soon found themselves in a knock-down drag-out to stay out of jail.

Fast-forward to this year, when Christopher Hitchens’s compact indictment, The Trial of Henry Kissinger, flares across the front cover of Harper’s and clings to a lower-tier spot among Amazon.com’s top-100 books. Hitchens builds a case against Nixon’s man for atrocities around the globe, from East Timor and Cambodia to South America and Washington, D.C. He shows just how frighteningly small the world of Kissinger has become, as one foreign government after another tries to get its hands on him, in the same way world courts have tracked down Augusto Pinochet and Slobodan Milosevic. Chile. France. Argentina. Slowly, they’re closing in.

Suddenly, the Harrisburg 6 seem less like relics of a forgotten era and more like prophets of an age to come. Here in the U.S., where the official response has been cold silence, there is renewed behind-the-scenes preparation for legal action against Kissinger. And some are again calling for a citizen’s arrest, lobbying for the public to do what the government won’t.

But could an average person really collar Manhattan’s Milosevic? “It would surely be possible to do so, and to end up quickly in jail or a mental institution,” says the noted linguist and political dissident Noam Chomsky. “A 17th-century English popular poet wrote that laws are like spider webs: ‘Lesser flies are quickly ta’en, while the great break out again.’ Not 100 percent true, of course, but a strong tendency, for reasons too obvious to discuss.”

Some suggest Kissinger, now an aging Manhattanite, is just too cuddly. “After all, he’s the darling of the establishment,” says the historian Howard Zinn. “These are all people who have had dinner with him. They don’t want to say they’ve had a war criminal for dinner.”

Others question why Hitchens—or his readers—would bother with busting Kissinger. “He was very much a No. 2 man, subordinate to Richard Nixon,” recalls Ellsberg, of Pentagon Papers fame. “It’s absurd to say he’s the principal architect. Of course he’s deserving of trial. But some people imagine that Nixon didn’t have the wit to think up those crimes on his own, and that’s quite mistaken. Kissinger was simply a very loyal, opportunist subordinate.”

Nonetheless, there is a growing movement to put him in the dock as the perp—or at least a witness—in crimes against humanity. The old Harvard professor has to watch his step. Though he still moves freely about the streets of New York, this “war criminal” had to slip out of Paris in May when French police tried to serve him with a court summons. Activists from the East Timor Action Network have repeatedly sought to question Kissinger during his book tours, but again the former secretary of state either didn’t answer or disappeared. Demonstrators have also hounded him at speeches around the country. This month, an Argentine judge ordered Kissinger to testify in a human rights trial concerning a plan by Latin American governments to kidnap and kill leftists during the 1970s.

And in July, a judge in Chile sent questions to Kissinger as a witness in a suit brought by Joyce Horman, the widow of Charles Horman, a young journalist killed during the Pinochet coup. Not amused, an administration source told the London Telegraph, “It is unjust and ridiculous that a distinguished servant of this country should be harassed by foreign courts in this way.”

Kissinger, who didn’t respond to Voice questions, shows some signs of knowing the heat is on. In his mounting campaign to protect his image, he recently agreed to release 10,000 pages of his papers kept under seal at the Library of Congress. Such goodwill gestures may not be enough to save the self-styled Dr. K. from a citizen’s arrest, in which he could legally be plucked off the sidewalk and deposited at a nearby precinct station for booking.

He keeps a fairly low profile these days, but he’s hardly invisible. Though it’s not listed on the midtown building’s marquee, the office for Kissinger Associates is located at 350 Park Avenue, on the 26th floor. Anyone can enter the lobby, passing a security guard and concierge unchallenged. Kissinger’s own receptionist sits behind a glass window. The spartan room contains a dark wooden table, upon which rest a white phone and an ashtray, a single couch and two armchairs, and a security camera mounted in one corner. The receptionist politely tells a visitor Kissinger is not in. Not expected. Who knows when he might drop in.

Don’t think you can just hang around and wait for him to show up. A citizen’s arrest is not so easy. While the laws differ from state to state, they generally allow for anyone who witnesses a felony, or knows which person committed one, to make an immediate arrest. That can include a “reasonable” amount of physical force. It would also normally involve some participation from the cops.

Back down on Park Avenue, across from Kissinger’s office, police officer John Vanasco explains the procedure. “We take the person and process the paperwork,” he says. “If it is a crime, we take the person in custody, but we need probable cause proving that the crime was committed.”

In the case of someone accused of being a war criminal, Vanasco says, city cops refer the matter to federal agencies, then hold the suspect for them.

A spokesperson for the NYPD puts it slightly differently. “Citizen’s arrest has nothing to do with us,” he says. “You make the arrest on your own. We do nothing more than transport the person. We are not making the arrest. We are not involved in this.”

Kissinger also keeps a home in Litchfield County, Connecticut, where state police say citizen’s arrests are not allowed. If you tried to capture him en route, you’d get to deal with the New York State police. “It’s all based on what the citizen says,” a spokesperson reports. “They may sign paperwork, but they don’t go out and physically arrest someone. It’s not like it is in the movies. It doesn’t happen a lot.”

The legal details of a citizen’s arrest are downright confusing. “It’s a tricky issue,” says Norman Siegel, former director of the New York Civil Liberties Union and current candidate for public advocate. For misdemeanors, he says, cops usually just write the accused a ticket. Felonies are another matter. When approaching a person you intend to pick up, you’re supposed to explain that you’re about to make an arrest, and tell the suspect why. That’s when the situation can turn ugly. What if the person tries to run away while you’re calling the cops from your cell phone? “Do you tackle them?” asks Siegel. “Cuff them?” The tables could quickly turn, and you’d be the one violating the law.

And if cops have reason to doubt the merit of accusations, they don’t have to follow through with the arrest. “A citizen’s arrest doesn’t really work,” says attorney Michael Ratner of the Center for Constitutional Rights, who has tried to nail various war criminals, from the contras to Haiti’s Tonton Macoutes. “They have to be committing a felony in front of you.”

Still, despite all the hassles, citizen’s arrests are used in New York City. The unarmed New York Guardian Angels make about two a year. “Basically every citizen has the right to make a citizen’s arrest,” says Mark Moore. “You physically restrain a person and hold them until the local cops come. We’re trained in restraint holds, arm bars, and different locks.”

Since Hitchens and others go after Kissinger for war crimes against civilian populations—like killing 200,000 Timorese, one third of the population—one might think the big human rights organizations would weigh in on this subject. But when it comes to Dr. K., these groups tread lightly.

Alistair Hodgett, Amnesty International’s American media director, says his agency can do little until the government declassifies reams of information. Even then, Amnesty wouldn’t necessarily take aim at Kissinger. “We would put the emphasis with the U.S. government to look at significant information,” Hodgett says. “I don’t believe or suggest that that’s likely to occur.”

The Lawyers Committee for Human Rights likewise barely dips a toe in the water. “The international justice system shouldn’t be about any one case,” says Raj Purohit. “If there is someone who has solid evidence, then he [Kissinger] should be held accountable.”

As for a citizen’s arrest of Kissinger, Purohit says, “That’s not something we would support. When it comes to these most serious crimes there has got to be a proper [order] from a tribunal or indictment. I think under any of these tribunals none of these would apply to Kissinger.”

Human Rights Watch is similarly reluctant to style Kissinger in prison stripes. “If Henry Kissinger signed off on bombing targets in Cambodia and Laos knowing that they included civilian areas, as accounts have suggested, then he could be charged with war crimes, by his victims or by the victims’ families,” says Reed Brody, an attorney who has gone around the world prosecuting human rights crimes. “But I think that it’s difficult not to confuse legal, political, moral, historical responsibility on the one hand, and criminal liability on another.”

Despite such gloomy prognoses, there are other hopes. Ratner thinks you could bring a civil action in Washington against Kissinger on behalf of the children of General René Schneider, the Chilean general who was shot during the Pinochet coup. And it might be possible to file a racketeering complaint in New York arguing that Kissinger and others conspired using the interstate communications—i.e, phones, faxes, etc.—to murder American citizens.

Another country could order him brought to trial on their soil. “Under the extradition laws, we do not have any exceptions for American nationals,” argues Alfred Rubin, a professor of international law at Tufts University. “The U.S. has extradition treaties with many countries, including Spain, and we do not except American nationals from their operation. If any countries in Europe or elsewhere would like to extradite Henry Kissinger, they can bring a case right now in an American court—and I’ll bet you that Henry Kissinger knows all about that.”

Finally, it is conceivable that the widow of Charles Horman, the young journalist who was killed in the Pinochet coup and was made famous by the film Missing, could bring a suit under the civil rights statutes on grounds that Kissinger and others conspired to deprive her husband of his rights. Since the conspiracy took place in the U.S., the suit might have standing in federal court.

Kissinger also might be prosecuted under the Alien Tort Claims Act. There has been considerable talk among lawyers about bringing such a suit on behalf of Chilean parties. Here the prospects are dicey, save for an opening granted by the courts to sue CIA officials for torture in Guatemala. In another case, lawyers argued in a Miami federal court that contra leaders conspired in Miami to kill Ben Linder, a young American engineer in Nicaragua.

The Chilean judge sitting on a case against Pinochet is asking Kissinger to come as a witness. Georgia Democratic representative Cynthia McKinney recently wrote Secretary of State Colin Powell, asking for help in persuading Kissinger to take the stand. She said Milosevic’s arrest should allow the public to concentrate on Kissinger now; if she desires, McKinney is in the position to open a forum on the subject.

But heading to Chile to testify would place Dr. K. in the position of discussing—in public and under oath—decisions he’d just as soon forget. Still, Horman’s widow thinks he should do what’s right. “I don’t see why Henry Kissinger would not want to answer the questions,” says Joyce Horman. “He’s not a defendant in our case; he’s a witness. Considering that he has said several times that he has no knowledge of the death of Charles Horman, he should have no reason not to answer these questions.”

One of the strongest calls for an investigation into Kissinger stems from the violence in East Timor, where he stands accused of supporting Indonesia’s 1975 bloody occupation of the recently freed Portuguese colony. In 1999 East Timor once again exploded into violence, which U.S. troops attempted to quell. A subsequent human rights commission proposed that the UN itself set up a war crimes tribunal.

The U.S.-based East Timor Action Network would like the tribunal to extend back to the original invasion. It could become a tool to find out what actually happened, and a mechanism for trying Kissinger. “I believe a criminal case can be made against him,” says John Miller, a spokesman for the group. “One country invaded another. He aided and abetted genocide. He provided a political go-ahead and was instrumental in continuing the flow of U.S. weapons.” As for supporting a citizen’s arrest, Miller says that would depend on how it was done. “We are not into assaulting people,” he says. “It would be mostly as a way of furthering public education.”

No doubt Kissinger is a disappearing symbol of the Cold War in general and Indochina specifically. During a recent forum sponsored by Harper’s magazine at the National Press Club in Washington, a group including journalists and former government professionals questioned why Kissinger should be singled out when an entire administration ought to take the blame.

“These were not unique actions,” said Scott Armstrong, whose National Security Archive has consistently dug up and published America’s dirty laundry. “They were not covert. They were not Oliver North-type government out of control. These were deliberate manipulations of the levers of power. And Henry Kissinger was—is—very much in the loop. He defined the loop. And [Hitchens’s] indictment is of an entire administration. And those who served with him, above him, across the Potomac, and even in Congress bear similar measures of responsibility.”

In a Voice interview Noam Chomsky seconds that idea. “Kissinger observes, correctly, that he was conducting the foreign policy of the U.S.,” he says. “The U.S. is a powerful state, overwhelmingly powerful, in fact. It follows that its leadership can make mistakes, but it cannot commit crimes in the technical Orwellian sense. Only enemies, or those who are weak and defenseless, can commit crimes in the literal sense. Accordingly, it is inconceivable that there would be an effort to bring Kissinger to trial.

“And even if it were done, he could correctly plead selective prosecution,” Chomsky adds. “After all, it was the Kennedy administration that escalated the war against South Vietnam from Latin America-style terror to outright aggression, and the Johnson administration that escalated the attack sharply, also extending it to the rest of Indochina.”

Roger Morris, best known for his scathing biography of Bill Clinton, worked under Kissinger in the National Security Council during the Nixon era. At the Press Club forum, Morris said he personally worked on a covert effort (unknown to either the secretary of defense or state) to reach a peace agreement in Vietnam. “There was on the table in the early spring of 1970 a negotiated withdrawal of American forces by the end of 1970,” he said. “That was interrupted by the dementia, not, alas, of Henry Kissinger, but of the man he worked for—Richard Nixon—and the ensuing Cambodian invasion. And you know the sequel: Several thousand Americans died in the years that followed as a result.” He concluded, “Henry’s transgressions would not have been possible without the active intellectual and substantive support of his aides.”

Moreover, there’s the whole question of what international law is intended to accomplish. “International law does not involve personal crimes,” argued Rubin, the Tufts professor. “I would emphasize that immorality is not illegality, and illegality is not personal criminal liability.”

But a court hearing could do more for a nation than punish its most visible villains. “I think it would be good to have a trial,” says Zinn, the historian. “I wouldn’t want to put him in jail. I don’t want to put any of these people in jail. I don’t believe in that. I think it should be more like the truth commission in South Africa. Hold them up to the world, shame them, and ban them from dinner parties.”

There may be no tracking down of every powerful figure who has ever broken the rules. Trace it right back through history, says former White House candidate Ralph Nader. “Do you know any president who hasn’t violated international law dozens of times?” Nader says. “If Kissinger is a war criminal, what about Clinton, who killed citizens in Iraq? You can’t pick one person out. It doesn’t have credibility. International law is known primarily for violating it. Is there anything the U.S. won’t do abroad in violation of international law?”

For now, the way Kissinger’s world keeps shrinking may have to be punishment enough—at least until someone takes action. “Maybe if he makes a mistake and travels abroad where he doesn’t expect to be apprehended, then that country could arrest and try him,” concludes Zinn. “He doesn’t want to set foot in France because he’s afraid of that. I think that’s a very nice little punishment that doesn’t allow him to see Paris ever again. Apprehending him in the U.S., with the judicial system and friends—even so-called critics? Nothing is going to happen to him unless someone makes a citizen’s arrest.”

Harms and the Man

An indictment of Henry Kissinger for genocide, crimes against humanity, and war crimes would include (but not be confined to) the following.

VIETNAM: Kissinger scuttled peace talks in 1968, paving the way for Richard Nixon’s victory in the presidential race. Half the battle deaths in Vietnam took place between 1968 and 1972, not to mention the millions of civilians throughout Indochina who were killed.

CAMBODIA: Kissinger persuaded Nixon to widen the war with massive bombing of Cambodia and Laos. No one had suggested we go to war with either of these countries. By conservative estimates, the U.S. killed 600,000 civilians in Cambodia and another 350,000 in Laos.

BANGLADESH: Using weapons supplied by the U.S., General Yahya Khan overthrew the democratically elected government and murdered at least half a million civilians in 1971. In the White House, the National Security Council wanted to condemn these actions. Kissinger refused. Amid the killing, Kissinger thanked Khan for his “delicacy and tact.”

CHILE: Kissinger helped to plan the 1973 U.S.-backed overthrow of the democratically elected Salvador Allende and the assassination of General René Schneider. Right-wing general Augusto Pinochet then took over. Moderates fled for their lives. Hit men, financed by the CIA, tracked down Allende supporters and killed them. These attacks included the car bombing of Allende’s foreign minister, Orlando Letelier, and an aide, Ronni Moffitt, at Sheridan Circle in downtown Washington.

EAST TIMOR: In 1975 President Ford and Secretary of State Kissinger met with Indonesia’s corrupt strongman Suharto. Kissinger told reporters the U.S. wouldn’t recognize the tiny country of East Timor, which had recently won independence from the Dutch. Within hours Suharto launched an invasion, killing, by some estimates, 200,000 civilians.

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November 9, 2002 Global Trade Looking Glass: Can U.S. Have It Both Ways? By DANIEL ALTMAN

Policies adopted by the Bush administration to advance specific domestic and international goals are undermining the White House’s own efforts to open markets through trade’s global rule-making body, some foreign officials say.

In particular, new farm subsidies and other barriers to the American market have led some of America’s trading partners to doubt Washington’s commitment to free trade, in spite of its ambitious proposals to reduce distortions in world markets. Those doubts, combined with the United States’ pursuit of trade agreements outside the World Trade Organization, have also diminished the pre-eminence of the W.T.O., the critics say. That change may impede a crucial round of global trade negotiations begun substantially through American diplomacy last November in Doha, Qatar.

“The United States was very supportive of some of the positions that those of us from the developing countries took at Doha,” Kofi K. Apraku, Ghana’s minister of trade and industry, said in a telephone interview. “What happened at Doha gave us hope that we could work together.”

But the mood has changed in the last year, he added. “There is a lot of concern and a lot of worry in our country about the United States’ commitment to carry forward the momentum that was created in Doha,” Dr. Apraku said.

In response, Robert B. Zoellick, the United States trade representative, said that all negotiators have to balance domestic concerns with those of their trading partners. “Many countries had to stretch politically and then had to deal with sensitivities back home,” he said in an interview earlier this week, “so a pause for repositioning is understandable.” Mr. Zoellick added that he was optimistic that the talks would succeed on schedule. “We’re not refusing to discuss anything,” he said. “I believe we can get the Doha negotiation done by 2005, if key developed and developing countries make the effort.”

Chief among Ghana’s concerns is the Farm Security and Rural Investment Act of 2002, generally referred to as the farm bill. The law will protect American farmers from slumps in the business cycle, but critics say it may also encourage farmers to overproduce. That would depress world prices for crops. Ghana does not export all the same crops as the United States, but Dr. Apraku said the bill set a bad precedent.

“It is a major concern for us in Ghana,” Dr. Apraku said. “We are a developing country. Agriculture is very important to us.” Farming accounts for 36 percent of Ghana’s economy and 60 percent of its jobs.

Ghana is not alone. “It is clear that the United States farm bill is not very popular in Canada, either,” said Pierre S. Pettigrew, Canada’s minister for international trade. “It certainly requires more explanation on the part of the United States.”

Experts estimate the farm bill, signed by President Bush last spring, could increase federal spending on agriculture by 70 percent over the next six years, to as much as $180 billion, potentially violating limits for farm support set during the last round of global trade talks, but Mr. Zoellick’s office disputed that.

Supachai Panitchpakdi, the director general of the W.T.O., said the increase in subsidies under the farm bill had hampered the new round of global trade talks. “It has created some questions, some doubts in the mind of some countries,” he said, “and has sometimes been used to delay some of the proposals.”

Dr. Supachai also noted that the talks were behind schedule. Negotiators missed a deadline for submitting a report on trade preferences for poor countries to the W.T.O.’s general council. “When the members missed the July deadline,” he said, “the prevailing view of the developing countries was a bit of disappointment — that they were let down.”

Mr. Zoellick said that the deadline had come too soon, since the overall shape of the negotiations — whether they would apply to tariffs, subsidies, quotas or other items — was still unclear.

He also said critics were overstating concerns about the farm bill. “The farm bill does nothing in terms of tariffs or market access,” he said. “It doesn’t change our policy on export subsidies.” Additional annual appropriations to subsidize farmers, he asserted, could make the situation problematic.

In addition to complaints about specific policies, some critics have also objected to Mr. Zoellick’s simultaneous pursuit of trade pacts with individual countries, with regional bodies like the Free Trade Area of the Americas and with the W.T.O. While that approach ensures against any one set of talks collapsing, diplomats say it also puts some negotiating partners at a disadvantage. Small countries in particular often lack the expertise to engage in three sets of talks, and the comprehensive negotiations at the W.T.O. could be shortchanged.

“The fact that our trade negotiators are so busy with the W.T.O., with the F.T.A.A. and with the bilaterals, causes a problem for all of us, not only for smaller countries,” Mr. Pettigrew of Canada said.

The Workers’ Party of Brazil, which will soon govern that country’s economy, the biggest in South America, plans to make the Free Trade Area of the Americas — not the W.T.O. — a top priority. “The schedule is more urgent on that,” said Giancarlo Summa, a party spokesman, “and of course there will be much more diplomatic pressure.”

The Free Trade Area of the Americas would lower and eliminate tariffs on goods traded among 34 countries on the two continents, and could shape the rules for trade in services and foreign investment.

For Chile, by contrast, a long-awaited bilateral agreement with the United States is “in the front of the road,” said Osvaldo Rosales, the country’s top trade negotiator.

Though Mr. Rosales asserted that bilateral and regional trade agreements would serve as an important test for American leadership in the W.T.O., he also said that the existence of such pacts could make the negotiations at the W.T.O. more difficult.

Dr. Apraku was even blunter. “These negotiations will reduce the scope of the W.T.O.’s influence,” he said.

Though a proliferation of trade deals could enhance African countries’ negotiating skills and influence, it could also deflect attention from the overall effort to improve the living standards of the poorest countries by bringing them more fully into the global trading system.

Mr. Zoellick affirmed the United States’ commitment to seeing negotiations through at all levels. He said he intended to complete free trade agreements with Chile and Singapore by the end of this year, and the pan-American and W.T.O. negotiations by the end of President Bush’s current term.

Yet worries about populist governments in Argentina and Brazil seem to have made neighboring nations more eager to sign bilateral deals. Panama, the Dominican Republic, Bolivia, Colombia, Peru and other countries have approached the United States, Mr. Zoellick said.

“They don’t want to be left out,” he said.

That suits Mr. Zoellick. “We will work with Brazil because its participation is important,” he said, “but if it doesn’t work, we’ve got to have alternatives.”

Developing countries have also taken issue with Mr. Zoellick’s opinion of the United States’ importance to the global trading system.

“Doha wouldn’t have happened if it weren’t for the United States,” he said. “The United States has an added responsibility for the trading and international economic system as a whole,” he added later.

Rafidah Aziz, Malaysia’s minister of international trade and industry, said that view might be overblown. She predicted that Mr. Zoellick would be “tearing his hair out” if he tried to strong-arm smaller members of the W.T.O. “No one can force anyone to do anything there, least of all the United States,” she said.

Sherman E. Katz, a scholar of trade policy at the Center for Strategic and International Studies, a policy center here that Mr. Zoellick used to head, said that the United States still provided much of the intellectual energy behind talks on complex issues like intellectual property and trade in services. He concurred, though, with Ms. Aziz’s central point.

“We can’t throw our economic clout around on the W.T.O. table as much as we used to,” he said.

Poorer members of the W.T.O. do not face an easy task. At least 50 issues related to carrying out the last global trade pact — a primary concern of developing nations — are on the table to be discussed before the end of this year.

“We are mobilizing ourselves so that we can have some leverage, make some difference, in these meetings,” Dr. Apraku said. “We do not want to be marginalized.”

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-Ian.

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http://teachanimalobjectivity.homestead.com/files/return6.htm

(From: “Sane Cows, or BSE Isn’t the Worst of It,” by Edward Luttwak, in the February 8 London Review of Books.)

At the Wye Plantation on the Eastern Shore of Maryland, the department of agriculture of the University of Maryland raises beautiful Black Angus cattle with all the latest equipment and best techniques. It produces bullocks and breeding heifers but serves as a model for Maryland’s “cow-calf operations” that produce beef for the table rather than milk. The results are impressive: 90 percent of the Wye cows produce a calf each year, and steers are ready for sale by their eighteenth month. I went there to find out how my family’s primitive Bolivian ranch might be improved–only 60 percent of our cows give birth in any one year, and our steers grow so slowly that we must keep them for thirty months to achieve worthwhile weights for the market.

Cattle are capital, and were indeed its very first embodiment, yielding their offspring as interest. The higher the birthrate, the higher the rate of return, if costs are equal. And time is money with cattle as with any other form of capital: a steer sold at thirty months earns less net revenue than one sold after eighteen months at equal weights, prices, and costs. All in all, the Maryland numbers showed that there was much to be improved on our ranch.

The Maryland experts were interested in how we ranch and how we sell our cattle, given the 200 roadless kilometers to the nearest town (by rafting downriver to Brazil). They were eager to help. Our humped Nelor cattle conceive by the fifteenth month or even earlier, give birth after nine months of gestation, and can become pregnant again a few weeks later, just like the Wye cows. But our fertility rate is so much lower, I learned, because if cows and bulls are left to commune according to their desires, many cows resist impregnation, prefering to raise their calves for at least six months before becoming pregnant again. Artificial insemination is the remedy. In Wye all cows ready to breed again but not visibly pregnant are tested with sonograms by the resident vets, and those carrying no embryo are separated from the herd to be frequently tested, with a thermometer inserted into their vagina, until estrus is detected. At that point, the frozen semen of prize bulls is defrosted and injected, and the procedure is repeated until sonogram results are positive.

With our cattle dispersed over 78 square miles of savanna grassland interrupted by islands of tropical forest, we cannot emulate any of those practices. With one-by-one animal husbandry impossible, our cows and bulls are left to graze and procreate on their own, except for the few days a year when our eight cowboys, their older children, the manager, and I round up all the cattle we can find to corral them for counting, the branding of yearlings, castration, foot and mouth vaccination, the feeding of vermifuge, and fumigation against external parasites. During the long rainy season, when swollen streams and swamped pastures drastically limit movement even on our sturdy criollo horses, we do not even know where our cattle are much of the time, let alone which of our heifers is ready for impregnation. In any case, we have no sonogram machines or the electricity to operate them; our cows are too wild to be tested for estrus with a thermometer; and we can’t preserve semen, for we have no refrigeration. The only way we can increase the fertility of our cows–the key to our entire profitability, as we have no dairy cattle–is to provide enough bulls. In Wye they keep a few “clean-up” bulls with their 170 cows to complement artificial insemination, but we have forty bulls for each lot of 500 cows, deliberately sellecting smaller-framed animals because young heifers flee from the very large bulls that win prizes–heavy and slow, they seem to enjoy standing around looking impressive but mount few cows and earn their keep only with extracted semen. Our calves are also born smaller, of course, but that is no disadvantage at birthing time, when our heifers easily drop their young without any help at all, let alone the pulling chains, winches, and risky cesareans used by cattle raisers in all advanced countries.

There was one consolation in my failure to learn anything useful about fertility. Our procreation costs start and end with our bulls, bought at $400 each–and we can eventually recover more than that when we sell them for meat in their eighth year. At Wye, by contrast, as in all commercial cattle-raising ventures in Europe and the United States, high fertility does not come cheap. Sonogram machines, veterinary care, even the semen, at more than $30 a shot, are all very expensive, and there are many more abortions and stillbirths when cattle are bred for size, to jump-start the race to the market. Doing my sums, I discovered that for us a 60 percent live-birth rate was better than Wye’s 90 percent in spite of all the extra bulls we have to keep, simply because of the vast difference in the cost of keeping animals in the first place.

At Wye, as in almost every cow-calf operation in Western Europe or the United States, cattle cannot feed themselves all year round on green pasture. Only hobby farmers with few cows and a lot of land have the ten acres or so of decent land per head that are needed–and even they must usually provide baled hay durring the coldest winter months when grass stops growing. With all the better land in Europe and North America taken up by the intensive or arable farming that inherent productivity or subsidies make more profitable, almost all commercial cattle raisers must complement whatever green pasture they have with hay and other feeds at a cost of roughly $250 per year per head–it makes little difference if they buy the hay ready-bailed or grow it themselves, with tractors, harvesters, fuel, fertilizer, weed killers, and pesticides. The leftover straw of cereal crops and other roughage that may cost little or nothing is used, too, but lactating and pregnant cows and those fast-growing steers must also be fed more costly, more protein-rich concentrates, such as maize, oats, barley, grain sorghum, wheat, beet pulp, oilseed or soybean meal, molasses, synthetic urea, and, until recently, processed animal offal, including the sheep brains that have led to present difficulties. Our cattle, by contrast eat only the natural grasses of the savanna, picking and choosing among different plants at different times of the year to find all the nutrition they need, except for salt with mineral additives that costs us $3 per head per year.

We can afford to keep all those extra bulls and the 40 percent of our cows that fail to give birth in any one year because each steer we sell can pay for the salt of eighty-three heads. Since feeding costs us 1 percent of what cattle raisers in Europe or North America must pay, their animal husbandry holds no lessons for us. True, we must keep our steers for thirty months before they are ready for market, but that only costs us $7.50 in salt as opposed to the $375 or more in hay and concentrates eaten by a Maryland or British steer by the time it is ready for sale at eighteen months. Of course, there is the interest on delayed revenue to be reckoned, as well as the much lower weight of our steers, but given our abundance of grass it simply does not pay for us to minimize time and maximize weight at high cost, let alone fatten our animals in feedlots with expensive concentrates and supplements.

In other words, while European and North American cattle raisers pay their dues to the corporations that supply them with everything from tractors and fuel to bagged concentrates, we pay our dues to nature by accepting its pace and limits. So far that has been a rewarding choice: our return on cattle capital exceeds 30 percent, more than twice what North American and European cattle raisers can expect, though their corporate suppliers fare much better of course. The profitability of the entire sector is so tenuous in the United States that many ranchers stay in business only because they are not in business at all but rather keep their ranches for pleasure of display, a la W. Bush or Ted Turner, losing money each year, which they bill to the taxpayers by way of loss credits against the earnings of their real trade. Recently “buffalo” (bison) ranching became fashionable among the tax-loss crowd, though it was attempted by some desperate cow ranchers as well, who discovered that costs are even higher–not least for steel-tube fencing–and profits even lower. Among the dwindling band of genuine ranchers, a great many are consuming their capital year by year by accumulating mortgages against their land. As the number of independent ranchers and farm-based cattle raisers continues to decline in the States, as it would in Europe but for subsidies, they are replaced by large scale corporate operations, some of them immense; but they, too, are not faring well.

All that frantic productivity is thus an attempt to offset miserable margins with sheer quantity, which in turn drives down prices, reducing profitability even more. During the last two years, we have sold finished steers in the border town of Costa Marquez, in the back of Rondonia, one of Brazil’s least developed areas, at prices ranging from $1.05 to $1.45 per kilo, measured at 50 percent of live weight (“pencil shrinkage”), only a few cents less than the price to be had in Chicago for animals on which far more money has been spent. But then if Amazonian ranching were not so inherently profitable, Amazonian forests would not be endangered. (For the record, we preserve our forests intact; our land in San Joaquin Province is on the very edge of the uninterrupted rain forest that begins just across a ten-mile lake but is still mostly savanna grassland that was never deforested.)

At the Wye plantation I learned something else, or rather saw it while we were talking. It was the veterinary chart of a Maryland cow-calf operation, with seperate rows for pneumonia, diphtheria, infectious bovine rhinotracheitis, parainfluenza-3, bovine viral diarrhea, bloat, three kinds of clostridial infections, cocidiosis, pinkeye, cancer eye, foot rot, actinomycosis lump jaw, hard lump jaw, acidosis, laminitis, nitrate poisoning (from heavily fertilized pasture), and many more conditions. Treatments were also listed with antihistamines, dexamethasone, adrenaline, sulpha boluses, dimethyl sulfoxide, nitrofurazone, and novalson, as well as several vaccines, vermifuges, fumigants, homely iodine and castor oil, and many, many applications of antibiotics–a long list of them, starting with penicillin and going on to LA-200 and others equally obscure to me.

The reason I found this chart startling–though I later learned that it reflected normal conditions throughout Europe and North America–was that on our ranch we get by with one vaccination, two vermifuge doses, and two fumigations per year, all done by ourselves since there is no vet within reach. How could it be, I asked, that Maryland cows needed all those medicines, and the frequent services of veterinarians? The experts pointed out that a great variety of medicines was indeed essential, for otherwise cattle would die of disease. They estimated that veterinary care and supplies added some $50 per head per year to the average cost of upkeep.

We, too, lose cattle to disease as well as to jaguars, maned wolves, and anacondas (yes, they can swallow a newborn calf), but our combined losses have been running at roughly 1 percent per year. No, I was told, it was nothing like that: without several specifics and lots of antibiotics, cattle raisers would lose a great many head, and in feedlots mass deaths would be inevitable, for infections spread immediately among animals kept within inches of one another. Again, I asked why cows in salubrious Maryland–or Britain, for that matter–were so much more vulnerable to disease than our cows, which live in the intensely tropical Amazon basin, dense with every form of life, including a myriad of microorganisms, internal and external parasites, and blood-sucking vampire bats that carry all manner of diseases.

I received two answers. The first was that our slim Nelors, while much less productive of meat and useless for milking, were resistant to disease because they were the offspring of natural sellection undistorted by veterinary interventions, rather than cattle systematatically bred for productivity alone. The second answer, however, was the more conequential; unlike humans or pigs, who can eat anything organic, animal or vegetable (except for grass or wood, because our stomachs cannot break down cellulose), bovines are pure herbivores. Their four-part ruminant stomachs break down the cellulose in grass that we can’t digest to extract all the proteins, vitamins, minerals, and calories they need. Conversely, cattle can’t easily digest proteins, beyond the tiny amounts consumed by the microbes in their first stomach (the rumen), which break down cellulose. Yet for the sake of rapid weight gain and rapid procreation, European and North American cattle are fed with cereals and all those other concentrates that contain even more protein, as well as pre-bloom alfalfa hay, which is itself 16 percent protein. One result is that European and North American cattle raisers are always in danger of losing their animals to bloat, a foamy gas buildup in the rumen that presses against the lungs with a suffocating effect. Anti-foaming agents and trocars are kept on hand to puncture the rumen in emergencies.

The other results of feeding proteins to herbivores are much less dramatic, altogether more prevalent, and of far greater significance for human health: chronic diarrhea and acidosis, which hardly ever kill cattle outright but disrupt their immune systems, exposing them to all the diseases I saw on the Wye chart and a few more besides.

To put it plainly, nearly all beef cattle in Europe and North America are permanently unhealthy and survive in a chronic state of low-level sickness only with large doses of antibiotics. Because they are cheap and induce water retention that increases weight, antibiotics are just the thing for cattle raisers and feedlot operators–whose animals could not survive a week without them. For those who eat the resulting beef no ill consequences need follow individually, though I myself am nauseated by the idea of eating the meat of sick animals pumped full of antibiotics and assorted medicines–since visiting Wye, I eat only Argentine beef when I can get it, and my own when in Bolivia.

Public health, however, is another matter. At a time when old diseases such as TB are reappearing, and wounds and fractures are once again followed by stubborn, even lethal infections because many bacteria strains have become highly resistant to antibiotics, their use in mass quantities by cattle raisers adds to the problem. Until recently, it was thought that humans could not absorb antibiotics from cooked beef, but research prompted by bovine spongiform encephalopathy (BSE) has incidently disproved that reassuring belief. One result is that people who eat beef may be spared an infection now and then; another is that they, too, are contributing to the evolution of increasingly resistant strains of bacteria.

The much larger issue is the entire logic of European and North American beef production in its present form. Tens of millions of head of cattle are raised in spite of the lack of anything like enough green pasture for them. In Western Europe, subsidies provide an incentive to raise beef cattle even without any pasture at all, or almost none, as in Tuscany, for example, whose Chianini–the source of the much-celebrated Florentina steaks–is the largest of all cattle breeds, but where meadows are a rarity among all those vineyards and villas. When I questioned the systematic use of antibiotics by the entire industry of both continents, the Wye experts replied that without them there could be only grass-fed beef, which tastes wonderful, as any visitor to Argentina can attest, but is too tough for palates used to the very soft flesh of grain-fed animals, further softened by immobility in feedlots–and by antibiotics. But their stronger retort was that beef fed on grass alone would be necessarily scarce and expensive. It no longer could be an everyday food for virtually everyone, but only for the affluent, and only an occasional treat for the poor or parsimonious. Yet at same time cardiologists unanimously assert that most people in Europe and North America eat far too much beef–that it should be an occasional treat rather than an everyday food, which many eat twice a day.

The veterinary profession has therefore systematized, indeed normalized the raising of unhealthy cattle to acheive the very abundance that makes people unhealthy. In its rarity, BSE is only an extreme consequence of feeding animal proteins to herbivores that can’t eat even alfalfa in any quanity without ill effect, let alone sheep brains. If the unending BSE drama finally attracts public attention to the habitual malpractice of the cattle industry, we may yet see North American and European herds reduced to their naturally fed size, that small fraction of present numbers for which green pasture can be provided all year round. And if that supply is insufficent, the pampas and savannas of South America can provide all that is needed, my ranch included, of course, with its beautiful Nelors.

———–

-Ian.

http://www.sonicnet.com/news/archive/story.jhtml?id42818 [ Sun., April 15, 2001 5:50 PM EDT ] Punk Pioneer Joey Ramone Dead At 49 Lead singer of Ramones had lymphatic cancer.

Joey Ramone, lead singer of legendary punk band the Ramones, passed away Sunday at the age of 49.

The towering frontman, born Jeffrey Hyman, did not respond to treatment for lymphatic cancer, a disease that attacks the body’s ability to fight infection. U2’s “In a Little While” was playing in his room at New York-Presbyterian Hospital when he died at 2:40 p.m.

Along with his cohorts Johnny, Tommy and Dee Dee — all of whom adopted Ramone as a surname — Joey was credited with helping found the modern punk movement. In mixing the griminess of the New York streets with a love of bubblegum pop, ’60s girl groups and the Stooges, the Ramones inspired everyone from the Sex Pistols and the Clash to Green Day and Blink-182 to stake their turf on four dirty chords and an (often) inane hook.

With his trademark rose-colored shades, black leather jacket, shoulder-length hair, ripped jeans and alternately snarling and crooning, hiccoughing vocals, Joey was the iconic godfather of punk. He gave voice to some of the most revered songs in the punk canon: “Blitzkrieg Bop” (RealAudio excerpt), “Gimme Gimme Shock Treatment,” “Rock ‘n’ Roll High School,” “I Wanna Be Sedated” (RealAudio excerpt), “Sheena Is a Punk Rocker.”

His profile was indelible.

The image of Joey’s body, left foot forward, right foot back, left hand strangling the microphone, fist pumping in the air as he shouted one of the band’s unofficial mantras, “Gabba Gabba Hey!,” is forever imprinted in the minds of any fan who attended one of the band’s 2,263 shows.

Born in the Forest Hills section of Queens, New York, on May 19, 1951, Joey founded the Ramones in 1974 with Johnny, Dee Dee and Tommy. Originally the drummer, Joey switched to vocals two months after the band played it first show in March 1974 at New York’s Performance Studio.

The group soon became a staple at the dingy New York punk club CBGB, home to fellow downtown bands Talking Heads, Patti Smith and Blondie. In 1975 the Ramones became the first punk band to sign a record contract. Their self-titled debut, recorded for $6,000, was released in 1976 and featured such rock landmarks as “Judy Is a Punk” (RealAudio excerpt of live version), “Now I Wanna Sniff Some Glue” and “Beat on the Brat.”

Destroying the ’70s prog-rock idea that rock had to be played by learned musicians in full command of their instruments, the Ramones pioneered the do-it-yourself ideal that inspired thousands of punk bands with lots of energy but dicey chops to pick up instruments and rock.

Their 1977 album Ramones Leave Home featured a quintessential mix of gutter-punk anthems and homages to classic pop songs (“I Remember You,” “Oh Oh I Love Her So”). It also featured the unofficial Ramones anthem “Pinhead,” in which Joey sang, “I don’t want to be a Pinhead no more/ I just found a nurse that I could go for.”

The Ramones not only prodded bands such as the Sex Pistols, the Clash and X-Ray Spex to take up their instruments and take on the world, but they also laid the path for the next generation of new wave and punk bands to rock maximally with minimal flourish.

Inspired by the Ramones’ wide-open subject matter — which ranged from sniffing glue to male prostitution to lobotomies — as well as by the music, ’80s bands such as Hüsker Dü, the Replacements and Devo further exploded the notion of how rock could sound.

The Ramones released what is arguably their best album, Rocket to Russia, in 1977. Featuring such concert staples as “Cretin Hop,” “Rockaway Beach” (RealAudio excerpt) and “We’re a Happy Family,” the album not only summed up the glum outlook of the punk generation, it was a shrill counterpoint to the disco music that was sweeping the nation in the wake of “Saturday Night Fever.” After trying their hands at the movies, starring in 1979’s “Rock ‘n’ Roll High School,” the group entered the studio with one of their idols, ’60s “wall of sound” producer Phil Spector. The resulting 1980 album, End of the Century, included a cover of “Baby I Love You” by the Ronettes, who were fronted by one of Joey’s favorite singers, Ronnie Spector (Phil’s ex-wife).

The group followed with 10 more studio albums of speedy, anti-social punk and a relentless touring schedule, and enjoyed Beatlemania-style fame in Argentina and Japan.

Although the band rarely cracked the album charts and achieved marginal album sales during a 22-year career, its influence continues to this day. With most of his contemporaries faded, dead or inactive, Joey became the embodiment of first-wave punk, with a shy, soft-spoken manner that belied his band’s twisted songs about social misfits too bored, disconnected or disaffected to play by the rules.

Joey may have shared a last name with his bandmates, but familial love couldn’t keep them from their constant bickering, leading to the Ramones’ dissolution in 1996. After the group played its final show on August 9, 1996 — such fans as Pearl Jam’s Eddie Vedder and Soundgarden’s Chris Cornell jammed with the Ramones that night — Joey continued to carry the torch for the music he loved.

In addition to producing an EP and an album by horror-ska rockers the Independents — whom he tirelessly championed and managed for much of the late ’90s — Joey co-produced a 1999 EP by his idol Ronnie Spector.

The EP featured one of Joey’s most poignant tunes, “She Talks to Rainbows,” a ballad he wrote for the Ramones’ 1995 studio swan song, Adios Amigos!. It was about a girl Joey would often see in his neighborhood, who he said looked like she was in her own world.

“She’s a little lost girl in her own little world/ She looks so happy, but seems so sad/ Oh yeah/ I’d like to help her/ I’d like to try/ Oh yeah,” Spector sang in her trademark yearning voice on the EP.

In addition to trying to help resurrect the career of his hero Spector, Joey was working on his debut solo album over the past three years.

Collaborating with long-time Ramones producer Daniel Rey, Ramone had written nearly 20 new tunes that he planned to record with a band that included Andy (a.k.a. Adny) Shernoff of the punk group the Dictators, Cracker drummer Frank Funaro and Rey on guitar.

Joey kept a low profile over the past few years, jumping onstage to belt out occasional Ramones songs at birthday parties in his honor thrown by his punk-rocker friends in New York. In February 2000, he buried the hatchet with former Ramones drummer Marky Ramone, recruiting Marky to play on a handful of his solo songs.

Private services will be held on Tuesday.

— Gil Kaufman

-Ian.

http://dailynews.yahoo.com/h/nm/20000516/wr/terra_agreement_3.html

Tuesday May 16 7:49 PM ET Terra Agrees to Buy Lycos for $12.5 Billion By Jessica Hall NEW YORK (Reuters) – Spanish Internet group Terra Networks SA (NasdaqNM:TRRA – news) agreed on Tuesday to buy U.S. Internet search company Lycos Inc. (NasdaqNM:LCOS – news) for $12.5 billion in stock, in a move to create one of the world’s largest Internet companies and broaden its geographic reach.

Lycos’ novel online programming, as well as its youthful customer base, will help Terra turn its string of companies across Latin America and Europe into a World Wide Web powerhouse with broader global reach, industry analysts said. Lycos also will allow Terra, the fast-growing Internet arm of Telefonica de Espana SA (TRR.MC), to target the 30 million Spanish-speakers in the United States.

The merger, which was widely expected, as well an expanded partnership with German media company Bertelsmann AG and a new wireless joint venture with Telefonica, will help the companies better compete against Internet industry leaders America Online Inc. (NYSE:AOL – news) and Yahoo Inc. (NasdaqNM:YHOO – news)

“If your view of the world is that you need to be global, and you need to be in the U.S., then Lycos is a reasonable move,” said Warren Thune, vice president for Mercer’s Internet strategy group in Washington, D.C. “Lycos has knowledge about how to grow quickly and compete in the U.S., and Terra has knowledge about targeting niche market and Spanish-speaking customers that Lycos could capitalize on,” Thune said. Shares of Lycos surged about 60 percent in the past week in anticipation of the deal.

Terra agreed to buy Lycos Inc. for $97.55 a share, Lycos’ stock closed at 72-5/8, up 11, on Nasdaq. Terra’s stock fell 3-5/16 to 53-9/16 on Tuesday as investors feared that the acquisition may be too expensive.

The combined company, which will be called Terra Lycos Inc., will have pro forma 2000 revenues of about $500 million and together have an estimated 50 million unique users and 175 million page views per day. The company will have operations in 37 countries.

“Our combination brings together many complementary strengths that we believe will enable Terra Lycos to generate consistently higher growth in revenues, cash flow and users than either company could expect to achieve independently,” said Juan Villalonga, who is chairman of both Telefonica and Terra.

Villalonga will head the merged Lycos-Terra. Robert Davis, currently Lycos president and chief executive, will be chief executive.

Bertelsmann, Telefonica Play Significant Role As part of the merger pact, Bertelsmann, the third-largest media company in the world, agreed to purchase $1 billion of advertising, placement and integration services from Terra Lycos over five years.

Terra-Lycos, meanwhile, will gain access to Bertelsmann’s books, music, television, film and other media content, on preferred terms. This alliance builds on the existing Lycos-Bertelsmann joint venture in Europe — Lycos Europe.

“What will be interesting to see is what Bertelsmann can bring to the table, since that’s who has the most impressive content,” said Patrick Keane, senior analyst with research firm Jupiter Communications.

Terra Lycos also will have access to all of Telefonica’s media content. Telefonica is the largest broadcaster and the second largest pay-television operator in Spain and Argentina, where it also owns leading radio stations.

Terra Lycos will also own 49 percent of a new wireless joint venture being established in partnership with Telefonica. Terra Lycos will gain access to Telefonica’s extensive cable, fixed line, broadband, satellite and wireless networks, which now serve more than 60 million customers globally.

The relationships between the companies could become even more intertwined. Bertelsmann Chief Executive Thomas Middelhoff said a new deal between Bertelsmann and Telefonica could be announced later this week or the beginning of next week. He did not elaborate.

Terms Of The Deal Under the terms of the agreement, each Lycos share will swapped for $97.55 of Terra ordinary shares, or their equivalent in Terra American Depository Receipts. The deal is subject to a so-called collar, which protects against a decline in Terra’s stock price.

Terra shareholders, including Telefonica, will own between 54 percent and 63 percent of Terra Lycos, while Lycos shareholders will own the other 37 percent to 46 percent of the combined company.

As part of the deal, Telefonica agreed to underwrite a $2 billion rights offering by Terra. Upon completion of the offering, Terra Lycos will have more than $3 billion in cash.

The Lycos acquisition continues Telefonica’s Villalonga’s track record of aggressively bidding on acquisition targets. Previous bold moves include its bid for Brazilian fixed-line telephone company Telesp and a 5.5 billion euro all-share bid for Dutch television company Endemol Entertainment (EMOL.AS).

The Lycos deal may help Villalonga regain investor confidence after Telefonica’s failure to clinch a merger two weeks ago with KPN Telecom (KPN.AS) of the Netherlands, analysts said.

Some Concerns About Deal

While Lycos has been looking for partners or a buyer since its deal with Barry Diller’s USA Networks Inc. (NasdaqNM:USAI – news) fell through last year, some analysts expressed caution on the Terra deal.

Terra’s stock, although down from a 52-week high of 145, is still seen by some analysts as overpriced. Terra has a valuation of $10,000 per subscriber, compared with less than $5,000 for industry leader America Online Inc. (AOL.N), Salomon Smith Barney analyst Lanny Baker said in a research report. Concerns about Internet access pricing pressure, customer turnover and the shift toward high-speed Internet infrastructure could muddy investor enthusiasm for the deal, analysts said.

Terra Lycos will be listed on Nasdaq and Madrid’s stock exchange. The deal is expected to close in the third quarter of calendar year 2000.