Melt Down

Film Introduction From Open Culture:
Doc Zone, a documentary series produced by CBC Television, is now airing a four part investigation into the great financial meltdown of 2008. Along the way, the CBC’s Terence McKenna takes viewers “behind the headlines and into the backrooms at the highest levels of world governments and banking institutions, revealing the astonishing level of backstabbing and tension behind the scenes as the world came dangerously close to another Great Depression.”

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Tok Piksa presents the 4 part series here, with background information taken from Al Jazeera’s English site, which also hosts the four-part series.


PART 1:
The men who crashed the world

In the first episode of Meltdown, we hear about four men who brought down the global economy: a billionaire mortgage-seller who fooled millions; a high-rolling banker with a fatal weakness; a ferocious Wall Street predator; and the power behind the throne.

The crash of September 2008 brought the largest bankruptcies in world history, pushing more than 30 million people into unemployment and bringing many countries to the edge of insolvency. Wall Street turned back the clock to 1929.

But how did it all go so wrong?

Lack of government regulation; easy lending in the US housing market meant anyone could qualify for a home loan with no government regulations in place.

Also, London was competing with New York as the banking capital of the world. Gordon Brown, the British finance minister at the time, introduced 'light touch regulation' - giving bankers a free hand in the marketplace.

All this, and with key players making the wrong financial decisions, saw the world's biggest financial collapse.

PART 2:
A Global Financial Tsunami

In the second episode of Meltdown, we look at how the financial tsunami swept the world. We hear about a renegade executive who nearly destroyed the global financial system and the US treasury secretary who bailed out his friends.

Henry 'Hank' Paulson, the former CEO of Goldman Sachs and later an economic advisor to the US government; refused to bail out global financial services firm - the Lehman Brothers. Paulson said it was not the role of government to save private businesses.

Lehman's failure had repercussions around the world. Millions of people lost their life savings. Pension plans were decimated.

Christine Lagarde, the French finance minister at the time and a close friend of Paulson's, publicly described Paulson's decision on Lehman "horrendous".

Markets from London and Paris to Shanghai fell. An epidemic of fear caused the world's major banks to stop lending, ending the year in protests and industrial action.

PART 3:

Paying the Price

The third episode of Meltdown looks at how the victims of the 2008 financial crash fight back. A protesting singer in Iceland brings down the government; in France a union leader oversees the kidnapping of his bosses; and thousands of families are made homeless in California.

Hordur Torfason, an Icelandic singer, leads the way in holding protests over the country's economy, calling for the resignation of the government and new elections.

Geir Haarde, the prime minister of Iceland, was surrounded and pelted by the protestors. Haarde soon resigned and the country's government collapsed.

In France, workers fought back to claim their rights. The Continental Tire factory announced its plant would close by 2010, meaning job losses for its 1,120 employees. Workers occupied offices and trashed the place in protest. Protests spread right across France and Europe.

As the grim toll of the financial crisis continues to mount around the world, many governments are looking for the true causes of the meltdown. In many cases, what they are discovering amounts to a crime.

PART 4:
After the Fall

In the final episode of Meltdown, we hear about the sheikh who says the crash never happened; a Wall Street king charged with fraud; a congresswoman who wants to jail the bankers; and the world leaders who want a re-think of capitalism.

The financial crash of September 2008 brought the largest bankruptcies in world history, pushing over 30 million people into unemployment and bringing many countries to the brink of insolvency.

Sheikh Mohammed Bin Rashid al Maktoum calls himself Dubai's CEO. He claims to run his government according to strict business principles, but now many are quietly questioning his judgement and his leadership.

In depth coverage of US financial crisis protests

In the years before the meltdown, Dubai had the biggest real-estate bonanza in the world. During the crash, the market tumbled, losing 50 per cent of its value, leaving Dubai virtually insolvent. But this did not deter the sheikh.

In January 2010, Sheikh Mohammed threw a massive party to mark the opening of the world's tallest building - the Burj Khalifa - using PR strategies to suggest that the real estate crash was a good thing for the emirate.

As one world leader handles the crisis through denial, other leaders try to re-think capitalism. Even though the causes of the 2008 meltdown are now clear, there is no magic formula to stop it from happening again.

The world has to start planning for the next crisis, even as we recognise that this one is not over yet.

Text Transcription Source: Aljazeera

"MELT DOWN"
Writen and Directed by TERENCE MCKENNA
Series Producers: MICHELLE GAGNON and TERENCE MCKENNA

Debt and Deficit

Breaking down the barriers to public understanding and participation in national affairs

Well here I am, not an economist, but I'm trying to water down, not the myths and misconceptions about economical terms and practices, but rather, the barriers that prevent ordinary people from exercising their right to question decisions that affect our lives, especially, the socio-economic and political practices that involve the public from time to time in moments of great distress.

The Widget shows a real time counter showing how much National Debt the US is accumulating by the second, calculated on what it is buying and selling.

Learn more about 

us debt.

Definitions of Debt and Deficit:

National Debt: the accumulated borrowing by a national state, calculated on the difference between what the country has spent so far and still spending and what it has earned and still earning in the time of its existence as a country.

Annual National Deficit: is the money a country does not have to fund programmes according to it's budgetary plan for a fiscal year. It is the shortfall, a deficit, in the budget. This is the money the country may seek to borrow. Deficit can be reduced by reprioritising budgetary items, or a country can choose to borrow so that all the items in the budget are funded. Borrowing money to cover the deficit means a country increases its national debt. 

I have chosen to try to achieve public clarity regarding economic considerations by focussing on "debt" and "deficit", because these are the two terms that are current in the political stand-off in the USA, between Barack Obama on one side, who has in recent months allowed the democrats to drift too far right of left to be able to muster a mass left social movement against predatory capitalism.

On the other side we have the Republicans who are stuck at a critical moment where their right wing policies, that largely support big business in a predatory capitalist system, are becoming more and more difficult to sell to a public that is beginning to see that this grave economic system simply cannot be blamed on Obama, the Puerto Ricans or any other immigrant, religion or anybody else who is against us if they are not with us.

The stand-off in America about debt and deficit is a political power play. It has very little to do with what the country needs to do in order to earn revenue that actually repays its debt and allows the American people the ability to regain ownership of their own country.

This is a home grown problem for America. Because its history and brand of capitalism is deeply rooted in predatory capitalism and the way that thinks and acts. So in spite of the abolition of slavery, America philosophically did not progress very far from exploitative capitalism. Predatory capitalism instead sought immediately to embed itself within the systems of American law by seeking to and succeeding in making government legislate the kind of laws that gave the corporations the same rights as singular individual citizens. Over the years of the life of America, corporate interest sought to reduce the powers of government regulation on its rights and activities. In short, the corporation had become a super individual who was not only above the law but above government as well as we now see when the Republicans and the Democrats are both trying to prove which one of them most pleases the billion dollar corporations that hold America in the palm of their hands.

A Description and Definition of Capitalism

The first pillar of capitalism, is contained within the primary concept of capital itself. It is not restricted to material culture but in all the physical and abstract materials which are recognised and valued individually, collectively and universally. They are included;

• In the goods and services that comprise wealth of a nature which can be consumed by humans or;

• In goods, services and objects that make humans believe that they may be immortal, - like fences, houses, precious stones, perfumes, wedding rings and other jewelry, thrones, subjects, pets and other dependents, slaves, servants, labourers, multiple lovers, experiences, discoveries, monuments, titles, claims to fame, performance records etc.  

The second pillar of capitalism, is concerned with the politics of the acquisition and ownership of the first pillar of capitalism itself. This includes all the things, actions and systems humans and corporations employ in order to acquire and own capital itself.

The struggle between predatory capitalism and a social welfare mindful capitalism is a difference in recognition and agreements about the rules and conditions of engagement. It is a battle between the private interest and public heritage. About the limit to the powers of capitalism in terms of what corporate companies cannot seek to own in the public domain. It is a struggle of communities and nations of people to uphold their collective survival principles, and their right to enjoy the earth without having to pay.

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NOTE: I was looking for publicly available figures showing the PNG national debt and deficit but cannot find any figures online.

China keeps piling up more foreign money

China keeps piling up more foreign money
To understand the troublesome theories of the present banking system which is advancing predatory capitalism, and realise the reasons why China is forced to spend its foreign reserves by buying up new companies and the big brand names from abroad, one has to look inside China itself.

International financial arrangements and relationships especially those between the US and China have led to the pile up of China's foreign reserves. China's own failure or unwillingness to increase the value of its own currency the Yuan is making its own goods cheaper than goods produced and manufactured in America and Europe thus maintaining an imbalance of trade between the superpowers.
The present economic crisis also highlights the great divide between the rich and poor, where in China's case, the ruling party owns about 3 trillion US Dollars in foreign reserves while its own citizens have very little buying power on the international market because of China's maintaining of a weak Yuan.
Click on the Heading above or here to read some background from January 2011.

Austerities, Economic Incentives and the Melanesian Way

Introduction

As great economists of the globe struggle with the present economic crisis and the financial meltdown, small economies that are as yet, not fully integrated into the global market system need to ask themselves some critical questions about alternatives to the capitalist trap that the Industrialised nations of the first world are currently embroiled in.

Perhaps small economies of the Southern countries should take a second look at the nature of the beast we call capitalism, and before it is too late, to delay their total emersion into what many analysts have long recognised as a socially destructive economic system.

Simbu Dancers 2002 Port Moresby

It may be prudent for small economies to begin imagining appropriate escape routes and plans that may steer them away from a system that has marginalised them and jeopardised their own economic choices and chances for any equal participation in the global economy.

It is predicted by many experts that the capitalist system itself, in its present form will eventually fail all nations, including first world nations, and threaten or destroy many diverse societies which have alternative systems of human survival.

This article is meant to help maintain the right questions in Melanesia, regarding economic systems, by bringing together some critical reactions, analyses and discussions arising from the present economic crisis. At certain points we will cut back and forth from various discussions in order to ensure the article's own logic and to offer a perspective aimed at generating local discussion.

Strong Unions – The Worst Nightmare for the Financial Elite

"... we will use the same basic principle that we use in breaking a horse, combined with some more sustaining factors. We reduce them from their natural state in nature; whereas nature provides them with the natural capacity to take care of their needs and the needs of their offspring, we break that natural string of independence from them and thereby create a dependency state so that we may be able to get from them useful production for our business and pleasure". 

 -Taken from a speech delivered by a white slave owner, William Lynch, on the bank of the James River in 1712. 

To this day, the basis for the success of capitalism continues to be, the exploitation of humans and human labour. This is the primary source of its survival. Capitalism is a system that seeks to create an alternative reward for human labour - removed from the ordinary experience and the normal expectations of the fruit of human endeavour.

To be effective at this, a capitalist system strives first, to deny humans the total experience of production. In this way, humans who labour to create a certain product cannot fully comprehend their own part in the production of the marketable result of their labour - the finished product. Secondly the system strives to create a dependancy of the working classes on an addictive culture of consumerism.

On a closer scrutiny of the logic of capitalism, it may be noted that this system is the enemy of all other traditional culture and their connected forms of human survival systems and mechanisms.

Melanesian societies continue to witness the severe erosion of their cultures and the beginnings of a total loss of alternative economies and traditional trading relationships and partnerships.

Strong economies in the Pacific, who are themselves agents of global capitalism in the region, in many ways aid the stranglehold of capitalism by dominating regional dialogue and preventing the meaningful exchange at the level of small economies, amongst themselves as Pacific Island countries, thus preventing greater internal reflection and reaction to the capitalist threat on their fragile cultures and systems.

From the beginning, the capitalist system very quickly saw the Labour Unions as a threat to its ulterior intentions and its desire to exploit humans effectively. In the US

"... Worker rights and a decent wage represent a toxic brew to the ruling elite.  In the past, they expressed their antiunion position in a crude fashion.  From the 1870′s through the 1920′s, industrialists fought union growth with hired thugs and complicit law enforcement officials.  Organizers and union members were harassed, maimed, and killed throughout the country for simply acting on the right to organize and participate in a union".  


From: Strong Unions – The Worst Nightmare for the Financial Elite.

"Man wouldn’t pay you unless he had to"  -  Chris Rock.

Austerity Programmes

Dictionary meaning: Austere - harsh, stern, morally strict; severely simple - from the old Greek "Austeros" - severe.

"Austerity" as a concept and as an economic reform tool, works on the principle of seeking to destroy working class systems that stand in the way of economic imperialism. It does this by first pretending to be a cost saving exercise in a country's economy, by denouncing and discrediting many aspects of social protection mechanisms, refusing to pay for the costs of social security or refusing to support an effective social netting system, including retirement and pension schemes for the workforce of a country. It often fashions this policy by disguising the austerity argument as a criticism of the Unions and the impracticality of a nation to uphold many of the human rights principles that trade unions seek to uphold.

It helps those that push for an austerity programme to introduce these programmes at moments in time, when Trade Unions and their leadership have reached a state of organisation where there are internal conflicts and divisions about the means to various ends.

Austerity programmes have been introduced to working economies in the past, most notably to the British economy thus paving the way for the fall of the unions and the rise of "Thatcherism" from 1979 onwards.

"The head of British government had always been adamant that in order to carry out her radical social reforms, the unions had to be curtailed. After all, the workers affected by her reforms had a powerful organisation on hand in their trade unions, which were hardened in battle and also prepared to fight, and which stood up against the state ordinance of wage dumping and layoffs. Moreover, they were radical opponents of Thatcher’s agenda: the paradigm shift in the social welfare state that declares that the provisions workers have to make for the inevitable cases of need in their career in capitalism to be the “own responsibility” of those who cannot afford them. There was no question for the Prime Minister that her objectives — lowering national wage levels, liquidating unprofitable industrial sectors and privatising traditional government tasks in infrastructure — all these were a question of power, i.e. they required breaking union power. The Iron Lady’s mantra — “The solution to the union problem is the key to Great Britain’s recovery” — was a proclamation of class war from above against the trade unions and constituted the first step of her national reform project." 

- Taken from: "A model lesson on the magic formula for how to use wages and the social welfare budget as weapons in global competition" 

Anatomy of Capitalism (Structure of the Global Bank)

If we consider International monetary policies to be the main instruments regulating trade in today's global environment, then we would also consider the US Federal Reserve System (the central banking system of the United States) as the global bank leading the monetary policies that regulate the affairs of the earth's financial institutions. This is evidenced by the recent bail out of the Banking Institutions during this financial crisis.

Some of the main players within the structure of the Global Banking System include the Federal Reserve Bank, the European Central Bank, the Reserve Bank of India and the People's Bank of China. These entities are the main controllers of monetary policy on earth.

Global Banking Today

Traditionally, a Banking system was built upon the storage and transfer of liquid currency and portable property. These currencies and portable properties were actual goods of wealth or promissory notes convertable into goods of wealth and services of comparable value. These concepts and measures of trading relationships were honourable within a trading area, empire or community.

Today's Global Banking System is built on an advanced theory of money, where most of the monetary wealth that the Global Banking System itself seeks to dominate and control, is theoretical and even fictitious - often they are "not worth a plugged nickel".

The primary theories that build the credibility and wealth of the Global Banking System include articulated theories like:

• the advanced theory of money itself in which to a great extent money is no longer a measure of metal but rather a measure of speculation and trade confidence
• the speculation on the stock market
• the theory of market leverage

Demonstration of the fictitious aspects of Banking by looking at Leverage:

What Does Leverage Mean?

1. The use of various financial instruments or borrowed capital, such as margin, to increase the potential return of an investment.

2. The amount of debt used to finance a firm's assets. A firm with significantly more debt than equity is considered to be highly leveraged.

Leverage is most commonly used in real estate transactions through the use of mortgages to purchase a home.

1. Leverage can be created through options, futures, margin and other financial instruments. For example, say you have $1,000 to invest. This amount could be invested in 10 shares of Microsoft stock, but to increase leverage, you could invest the $1,000 in five options contracts. You would then control 500 shares instead of just 10.

2. Most companies use debt to finance operations. By doing so, a company increases its leverage because it can invest in business operations without increasing its equity. For example, if a company formed with an investment of $5 million from investors, the equity in the company is $5 million - this is the money the company uses to operate. If the company uses debt financing by borrowing $20 million, the company now has $25 million to invest in business operations and more opportunity to increase value for shareholders.

Leverage helps both the investor and the firm to invest or operate. However, it comes with greater risk. If an investor uses leverage to make an investment and the investment moves against the investor, his or her loss is much greater than it would have been if the investment had not been leveraged - leverage magnifies both gains and losses. In the business world, a company can use leverage to try to generate shareholder wealth, but if it fails to do so, the interest expense and credit risk of default destroys shareholder value.

Another Angle on Leverage at Work: 
For those that don't know, leverage is a way investors get a higher return.  It works much like a mortgage on your home.  To buy a $400,000 home you might put in $50,000 of your money and borrow $350,000 from the bank.  If the house increased in value by 10% you now have an asset that you can sell for $440,000 or $40,000 over what you paid.  But remember, you only put in $50,000, so you have made a return of 80% on your investment.  The $350,000 that you borrowed was financial leverage.

The problem with this theoretical system is that when the sub-prime market begins to melt down, bonds can lose value faster than the stocks drop. Lenders, alarmed by the drop in collateral may call-in their loans. As the value of collateral drops, a company or country is caught in a death spiral.

Going back to the housing analogy, it's as if your house is declining in value and worried about this, the bank calls in your loan and the loans of all of your neighbors.  But as all of your neighbors put their homes on the market, the value declines even more so that even if you sell, you can't repay the loan anymore, all of your equity has been wiped out.  At that point, you have no choice but to walk away and give the bank your house.

Financial Revolution Underway Led by the Global Banking System

There is a quiet revolution going on. It's not a political revolution or a social revolution. It is being carried out without guns, bullets or physical violence, but this aspect makes it none the less real. The world is in the midst of a financial revolution led by the banking system whose representative in the U.S. is the Federal Reserve, a private bank that is not part of our current government system and does not hold reserves. The goal is the complete dominance, ownership and control of all assets by the government. What Americans are now witnessing may be the finest coup d'etat ever perpetrated.

Welcome to Greece, the birthplace of democracy and now the first European country to fall victim to the Global Banking System.

The plight of Greece should be observed carefully by small economies of the South. How it fares in the next few weeks and how it will suffer or survives this global financial crisis.

The Greek Economic Situation within the Euro Zone

As I write this article, Greece is witnessing massive street protests and a strike of millions of workers against the government’s austerity plans.

Greek Austerity Protests  Click for more images at The Daily Bail

With many high level meetings taking place within the European Union leadership, especially between French and German officials, it seems to be of critical importance for the global banking system and its agents to prevent Greece from defaulting on its debt. The apparent fear are the regional consequences resulting from such a scenario.

The Greek Prime Minister George Papandreou is under immense pressure to try to ensure that his country steers away from defaulting on its debt to the European Union. This week Papandreou says that he will reshuffle his cabinet to try to achieve consensus on how to address the country’s crippling debt crisis.

PANITCH: ... So there is a problem in terms of Greece's finances, but that problem existed before the crisis. It was aggravated considerably by the fact that Germany is the big exporter in Europe's free trade zone. That's what the European Union is, a free trade zone. And Greece got the money through transfers from the EU, from the European Commission for a while, but mostly from borrowing from German banks to buy German goods. Right? And they were very heavily in debt when the global economic crisis hit. That global economic crisis was made in the United States in the American mortgage market, but Deutsche Bank was very heavily invested in the American mortgage market. Deutsche Bank owned almost all of black Cleveland's mortgages. They'd been foreclosing black Cleveland. Well, Deutsche Bank is in a precarious situation. They were bailed out, as were other banks, mainly by the Fed, not only by the European Central Bank.

JAY: The American Fed?

PANITCH: The American Fed. And when they saw a situation in which Greece would not be able to repay its debt, they were very worried that they would face a liquidity problem, and maybe even an insolvency problem, not from Greece alone, but insofar as that would have knock-on effects, especially to those other countries in Europe which also have been the importers of German exports and borrowed very heavily in order to be able to buy those imports. Now, what's very important here is that it wasn't primarily the states that were borrowing that money; it was private banks borrowing that money, lending it to Greek consumers and corporations who were importing this stuff. But the state then bailed out those banks, right, in order to make them solvent or guarantee their debt.

The severe public censuring of Greece is only sabre rattling which will not stop the inevitable - that Greece has no other way around the problem but to default on its debt mainly to German banks who themselves were rescued by the Federal Reserve Bank of America during the beginning of the crisis.

JAY: So what's the alternative? ... why not default?


PANITCH: ... Greece will default. I mean, it's not a matter of whether they should default. There is no choice. All you read in the media, all you see in the media is hard bargaining. It's hard bargaining. You know, what will be the cost to Greece of defaulting? It will happen. No question it will happen. 


So whereas after the Asian crisis, when, you know, the great booming East Asian countries, Korea and Thailand and so on, you know, experienced a tremendous outflow of capital, after that, the knock-on effects were such that they got the banks to restructure debt in a whole bunch of countries which felt the knock-on effects of this, as they applied structural adjustment programs to those countries as well. And they did so without the kind of hard bargaining. They were trying to stop the bleeding. 


In Greece's case, what they are afraid of is that if the default takes a form that doesn't involve very, very heavy costs, and certainly the German and French banks are insisting no cost to themselves--.

JAY: They want--"heavy cost" meaning heavy cost for the Greek people...

PANITCH: Yeah, to some extent for the German budget and the European budget and the French budget, and to some extent perhaps even for the American budget, because a lot of the quantitative easing that the Fed is doing is flowing into these banks to keep them liquid in case there's a default on that debt. So there's no question it'll default, and all that's going on is, you know, what the arrangement will be, you know, how serious it will be, and how severe the penalties will be so that others won't default.

The above interview is extracted from the video below.

The Melanesian Way - Survival of people in Marginalised Economies

This blog entry is concerned with the systems of survival in Melanesia and other South Pacific Islands. Having demonstrated what our fragile cultures are up against we have to recognise what we need to be doing locally to shield our people and our cultures from global financial crashes and melt downs. 

The following video shows that our people are already aware of the dangers that have befallen other economies such as the attempt to control the supply of all planting material on earth by Montsanto. Many people and organisations in Australia, New Zealand, Papua New Guinea and other smaller Pacific countries are starting to organise to protect land and the independence and self determination of fragile systems of survival, by protecting among other things, the self reliance of indigenous people, protecting their food resources especially seeds and other planting material.

Video: Alternative Action and Organisation


Needless to say, in view of the above issues, it becomes paramount to ask questions about where the new economic incentives of the region should be targeted. Should economic incentive be used to further the so called "austerity" in global capitalism or rather used as a humanitarian measure to protect the planet from misery and mass starvation?

 About the Speakers quoted in this Article

Leo Panitch (born May 3, 1945 in Winnipeg, Manitoba, Canada) is a Distinguished Research Professor, renowned political economist, Marxist theorist and editor of the Socialist Register. He received a B.A. (Hons.) from the University of Manitoba in 1967 and a M.Sc.(Hons.) and PhD from the London School of Economics and Political Science in 1968 and 1974, respectively. He was a Lecturer, Assistant Professor, Associate Professor and Professor at Carleton University between 1972 and 1984.

He is a prominent exponent of Marxism who sees his own work as theoretically innovative within that tradition, because he maintains that the dominance of the United States in the early years of the twenty-first century can't be understood using theories of imperialism that are themselves a century old.

He has argued, for example, that the concept of imperialism developed for the Victorian era over-emphasized the matter of the export of capital. Yet if one uses that as a yardstick today (he reasons) Great Britain is more a victim of U.S. imperialism than Kenya -- since American investors have much more at stake in the former than in the latter. The advanced industrial nations, in other words, are interpenetrating -- exporting capital to one another, not to the 'South,' and this requires a great deal of revision in Marxist-Leninist models.

Panitch has also argued that Marx was wrong to contend that the rise of trade unions would develop a socialistic class-consciousness in the working class. The association of workers for the purpose of collective bargaining has proven quite compatible with capitalism -- since such bargaining concerns the terms of wage labor, not the legitimacy of wage labor. He argues that Marxist political parties must abandon the assumption that there is anything inherently revolutionary about any class, so that they can get to work creating a self-conscious revolutionary class of wage earners, "articulating the articulation."

Bombing Nuclear Power Plants

Implications of Bombing a Nuclear Power Plant.

The plan to bomb nuclear power plants in Iran by Israel and the United Stares of America is a very dangerous idea. But just how dangerous? I've been snooping around for some opinions and estimates of the danger this plan imposes on our planet.

The first extract is taken from an article written in April 2008, by Floyd Rudmin in the website of the Centre for Research on Globalisation. The extracted parts are presented in this colour.

The US is said to have 10,000 targets in Iran.  Primary among these are all nuclear facilities, including the nuclear power plant at Bushehr on the Persian Gulf coast near Kuwait, and the nuclear enrichment facilities in Natanz near Esfahan.  Bushehr is an industrial city, with nearly 1 million residents.  As many as 70,000 foreign engineers work in the region, which includes a large gas field.  Natanz is Iran’s primary enrichment site, north of Esfahan, which also has nuclear research facilities. Esfahan is a world heritage city with a population of 2 million. 

Iran’s Bushehr nuclear reactor has 82 tons of enriched uranium (U235) now loaded into it, according to Israeli and Chinese news reports.  The plant is scheduled to become operational this summer, producing electricity.  The Natanz enrichment facility is operating a full capacity, enriching uranium for use in reactors according to IAEA reports.

According to the Center for Disease Control, the uranium 235 used in nuclear reactors has a half life of 700 million years.  As nuclear reactor fuel is used, it turns into uranium 238, which has a half life of 4.5 billion years.  These radioactive isotopes are dangerous to health because they emit alpha particles and because they are chemically toxic.  When inhaled, they damage lung tissue.  When ingested, they damage kidneys and cause cancer in bones and in liver tissues.  According to a recent review of medical research, uranium exposure causes babies to be deformed or born dead.

Never in history has it happened that nuclear power plants and nuclear enrichment facilities have been deliberately bombed.  Such facilities, everywhere in the world, operate under severe safety conditions because the release of radioactive materials is deadly, immediately and also long after exposure.  If the USA or Israel deliberately bomb a fully fueled nuclear power plant or nuclear fuel enrichment facilities, containment will be breached; radioactive elements will be released into the environment.  There will be horrific deaths for families in the surrounding vicinity.  The Union of Concerned Scientists has estimated 3 million deaths would result in 3 weeks from bombing the nuclear enrichment facilities near Esfahan, and the contamination would cover Afghanistan, Pakistan, all the way to India.

Reactors and enrichment facilities are built of extra strong concrete, often with multiple layers of containment domes, often built underground.  Bombing such facilities will require powerful explosives, earth penetrator war heads, maybe nuclear warheads.  The explosions will blow the contamination high into the atmosphere.  Where will it go is a question that is difficult to predict.

During the January 1991 Gulf War, many oil wells in Kuwait were set afire. According to the US State Department, “black rains were reported in Turkey, and black snow fell in the foothills of the Himalaya Mountains”.  The radioactive plumes from bombing Iran’s nuclear facilities would reach the same destinations, in the same weather conditions.  But the radioactive plume might go north, into Europe.  During the March 2003 invasion of Iraq by the USA, UK, Australia, and others, armour piercing shells and bombs tipped with depleted uranium (U238) were used.  It took 9 days for uranium particles from these weapons in Iraq to reach England, where air sample filters showed a 300% increase in uranium particles attributable to the war.  The weather patterns at the time that carried the particles to England passed over central Turkey, the Ukraine, Austria, Poland, Germany, Sweden, and Denmark, to England, then over Norway and Finland to the Arctic.  This was reported by The Times, summarizing a study in European Biology and Bioelectromagnetics.

The nuclear fallout from bombing Iran will have a half life of 700 million years.  That is a duration difficult to comprehend.  Jesus Christ was preaching a mere 2 thousand years ago.  In the evolution of humans, our earliest ape-like ancestors were walking upright a mere 5 million years ago.  The Bush administration and its Israeli advisors are now planning to contaminate the planet for 700 million years.  From the rhetoric of Presidential candidates John McCain and Hillary Clinton, they, too, think that is a good idea.  The US media seem to applaud.

Either Americans do not understand what it is they are preparing to do, or they think themselves immune to the consequences.  The planet is not large.  What goes around, comes around.  Smoke from the Gulf War oil fires went around the world and was detected in South America.  Radioactive fallout from bombing a nuclear reactor will also go far, especially considering that it has millions of years to make the trip.

The Persian Gulf nations of Saudi Arabia, Kuwait, Iraq, and Iran have more than half the world’s known oil reserves.  The 1981 study by Fetter and Tsipis in Scientific American on “Catastrophic Releases of Radioactivity” estimated that bombing a nuclear reactor would cause 8600 square miles around the reactor to be uninhabitable, depending on which way the wind blows.  Bombing the Bushehr reactor will mean half of the world’s oil is instantly inaccessible.  Bombing Iran means that Americans will not be driving cars any where, any more, for a long, long time.  The American Way of Life will be finished.  An economic collapse unimagined by Americans will follow.  Mechanized farming and food transport will be finished.  Famine is a possibility.  Food riots are a certainty, in the land of plenty, with the fuel gauge on empty...

It's hard to imagine why this idea of a destructive bombing of Iran's nuclear plants would make sense enough to be considered by these two countries. We know that the Zionist lobby in America is able to sway Congressional and Presidential opinion. Also America may in fact believe that Iran is too far away, such that the effects of a nuclear fallout in the USA be negligible.

But what might the psychology be of this Zionist State which has harboured a besieged mentality since 1947? Could Israel ever be free of its chosen manner of existence? Has Israel become so tunnel visioned that it cannot possibly imagine a peaceful process out of these very grave circumstances?

Some people have speculated that Israel is perhaps a suicidal state. I do not want to pursue that idea here although it is difficult to comprehend its actions and especially the constant danger to which it  subjects its citizens and the rest of the earth. Here are some opinions suggesting that Israel maybe a suicidal state:

Letter from Israel: Can Israel be seen as a suicide bomber?

From The American Conservative: Israel’s botched raid against the Gaza-bound humanitarian flotilla on May 31 is the latest sign that Israel is on a disastrous course that it seems incapable of reversing.

From the New York Times: "The Golem" seemed painfully apt: its central concern is the self-destructive consequence of Jews resorting to violence to defend themselves.

From the Haaretz - Israels daily newspaper in English: If there is one person who someone feels that our international situation is getting worse and another who thinks we are behaving like a suicide state, they should think again.

But what about the option of negotiation and a respectful dialogue between Israel and Iran with America and the rest of the international community as fair observers? Why is that not possible?

The next extracts are from the Asia Times:

Brazil steps between Israel and Iran

By Pepe Escobar

Talk about a Via Dolorosa. Luiz Inacio Lula da Silva is the first Brazilian president to visit Israel officially. Lauded for his charisma, swing and formidable negotiating powers - United States President Barack Obama refers to him as "the man" - little did Lula know that to engage his hosts this week he would have to give the Prophet Abraham a run for his money, no less. 

In the end, he stood his ground. He made no concessions. And unlike United States Vice President Joseph Biden last week, heeven managed not to be publicly humiliated by his hosts.

Lula is no stranger to tough neighborhoods. Former bouncer turned hardline politician Avigdor Lieberman, Israel's foreign minister, boycotted Lula's speech at the Knesset (parliament) as well as Lula's meeting with Prime Minister Benjamin Netanyahu. The reason: Lula did not visit the tomb of Zionism founder Theodor Herzl. But neither did France's President Nicolas Sarkozy or Italy's Prime Minister Silvio Berlusconi when they visited Israel. 

Brasilia - as much as Paris and Rome - knows very well that a visit to the tomb is not mandatory on presidential trips. Yet a choir of the Likud/settler hardcore Zionist faction in Israel carped that this would fatally wound the Brazilian government's drive to become a mediator in the Israeli-Palestinian conflict. 

After being grilled in the Knesset - including by Netanyahu - for his policy of non-confrontation and dialogue with Iran, Lula did not flinch. He condemned both the Holocaust and terrorism; he reminded his hosts of Brazil's and Latin America's stand against nuclear weapons; he stressed "dialogue" and "compassion" to solve the Middle East conflict; he defended a viable two-state solution for Israel and Palestine; but he also did not refrain from criticizing the expanded colonization of East Jerusalem. He received a standing ovation and, according to some members of parliament, "more applause than [former US president] George W Bush". 

The tropical prophet

Not even at his Abrahamic best would Lula have been able to mollify Zionists and assorted hardliners. Anyway, Lula told the Israeli daily Ha'aretz what every serious player in the Middle East already knows; the "peace process" is going nowhere, and bringing new mediators such as Brazil to the table is the only way forward. 

And the same applied to the Iranian dossier: "The [world] leaders I spoke to believe that we must act quickly, otherwise Israel will attack Iran." Lula is convinced that further sanctions on Iran over its nuclear program are counter-productive. And this quote is bound to resonate globally, "We can't allow to happen in Iran what happened in Iraq. Before any sanctions, we must undertake all possible efforts to try and build peace in the Middle East." 

The official Brazilian government view - echoed by much of the international community (that is, not the exclusive club of Washington and the usual European suspects) - is that everything is still to be negotiated with Iran over its nuclear dossier. Lula is adamant: Iran has a right to develop a peaceful nuclear program in terms of the nuclear Non-Proliferation Treaty to which it is a signatory. 

Brazil is currently a rotating member of the United Nations Security Council. As much as China, it will not support new US-driven sanctions on Iran - regardless of US Secretary of State Robert Gates spinning that the US has enough backing to advance a fourth, tough round of sanctions, with Saudi Arabia finally persuading China. China will never vote against its own national security interest - and Iran is a matter of Chinese national security. Lula will be in Tehran in May and will meet - again - with President Mahmud Ahmadinejad. Hardline Zionists are - what else - fuming.

Lula knows very well that so-called "smart sanctions" that would apply mainly to the Islamic Revolutionary Guards Corps (IRGC) - in charge of the bulk of economic and political power in Iran - would also affect millions of civilians connected to IRGC-controlled businesses, and thus the population at large, which is already paying the price for the current sanctions. The IRGC controls at least 60 ports in the Persian Gulf. Preventing Asia from doing business with Iran would imply a naval blockade - and that's a declaration of war. 

How not to push Iran 

Lula has hit the Middle East at a crucial juncture - just as Netanyahu's government has decided to build more settlements in East Jerusalem and the West Bank, even to the detriment of crucial US support on the Iranian front. 

Ironically, it's on the economic front, rather than geopolitics, that Brazil is managing to seduce the Israeli establishment. Israel signed a free-trade agreement (FTA) with Mercosur [1] - the fifth-largest bloc in terms of gross domestic product in the world - much to the chagrin of Palestinians, who identify the FTA as a powerful boost to the Israeli military-industrial complex. 

And this when it is clear that Brazil is strictly in favor of a viable Palestinian state according to the 1967 borders. This FTA carries a key strategic provision - it allows the transfer of weapons technology to Mercosur members. Thus weapons responsible for the repression in Gaza will soon be available in South America. 

On a parallel front, bolstering Brazil's role as mediator, Israeli President Shimon Peres personally suggested to Lula that Brazil could make two visits - by Syrian President Bashar al-Assad and by Netanyahu - coincide on Brazilian soil. Assad goes to Brazil this year, and this week Netanyahu also accepted an invitation. A tropical, informal Syrian-Israeli summit might be ideal to break the ice. Lula and Netanyahu have adopted a bilateral system of meetings between heads of state and top ministers every two years. 

By what about the US in all this? An official US-Brazil strategic agreement is also now in place, implying two foreign minister-level meetings a year, one in the US, one in Brazil. Brazilian Foreign Minister Celso Amorim has a very close relationship with US Secretary of State Hillary Clinton. On her recent visit to Brazil, Clinton pressed both Lula and Amorim to support tougher sanctions on Iran. The refusal was polite but firm. 

Clinton was left to complain at a press conference about how Iran is "using" Brazil, Turkey and China to evade sanctions. Amorim for his part is always fond of remembering the Iraqi disaster: "I was an ambassador at the UN during the critical moments of deciding about Iraq. And what we saw was a big mistake." 

Lula could not be more specific: "It is not wise to push Iran against the wall. I want for Iran what I want for Brazil: to use nuclear energy for peaceful ends. If Iran goes beyond that, then we will not agree with it." Roughly, that's the same position as China's. 

Lula and Obama had seemed to be in synch on Iran, starting from their meeting on the sidelines of a Group of Eight plus five meeting in L'Aquila, Italy, nine months ago. Then, Obama even encouraged the Brasilia-Tehran dialogue, as long as Brazil pressed on Iran the commitment to a strictly civilian nuclear program. That's exactly what Lula told Ahmadinejad when they met in Brazil. It is the Obama administration's position that has substantially hardened. 

Brazilian diplomats insist that Ahmadinejad never closed the door to negotiations. In discreet, bilateral diplomatic talks, US officials even admit to their Brazilian counterparts that Ahmadinejad himself is not inflexible, nor is Supreme Leader Ayatollah Ali Khamenei. In a February 19 speech at the naming of an Iranian destroyer, Khamenei once again denied that Iran was after nuclear weapons and stressed that they were illegal according to Islamic law because they killed large numbers of innocent civilians. 

The problem has been amplified by much American and European media hype. Defusing the sanctions drum rolls, even Clinton, in a moment of candor during her South American trip, was forced to admit that sanctions could take "several months" to be adopted, if at all. 

Even before Clinton's visit, Iran's Foreign Minister Manouchehr Mottaki had already admitted to Brazilian media on the record that Brazil could be a "bridge” between Iran and the US/European Union front, because of its "realist" position. Mottaki does not see Brazil as a "mediator" - but rather as "acting to facilitate consultations", as Tehran does not believe that any country should speak for its (Tehran's) own interests. 

Neither did Brasilia explicitly ask to be a mediator. Mottaki has revealed he's developing substantial "telephone diplomacy" with Amorim. Tehran obviously sees the benefits of establishing a dialogue channel to the industrialized West via a key developing country. 

Blessed are the peacemakers - for they shall inherit the earth. - from the book of Mathew.


But where are the peacemakers?