cryptogon.com

The mind boggles at a financial crisis far worse than the current one. Is such a thing possible? Even with this one, it may already be too late to prevent social unrest, especially in Britain, which is tipped to be one of the worst-hit countries economically.

The spectacle of bankers continuing to award themselves bonuses while taking taxpayer support is feeding an extraordinary public rage and a fierce sense of injustice. With 40,000 people losing their jobs each month, it is a recipe for trouble, come the traditional rioting months of the summer.

It won’t be bankers being lynched, of course, but small shopkeepers in inner-city areas having their windows smashed and their stock looted. The only surprise is there haven’t already been antibanker demonstrations in Threadneedle Street – secretly cheered on by 99 per cent of Middle England.

The seething sense of unfairness is almost palpable. The view that a small elite not only caused the crisis, but continues to profit at the expense of everyone else, is near universal. Gordon Brown’s promise of no rewards for failure in state-supported banks is looking ever more threadbare. We now know that Peter Cummings, the highest-paid person on the HBOS board, headed a division responsible for £7 billion of losses last year, yet he was still given a reported £660,000 payoff when he left in early January clutching his £6 million pension pot.

“One plan includes a Chapter 11 filing that would assemble all of GM’s viable assets, including some U.S. brands and international operations, into a new company,” the newspaper said. “The undesirable assets would be liquidated or sold under protection of a bankruptcy court. Contracts with bondholders, unions, dealers and suppliers would also be reworked.”

Citing “people familiar with the matter,” the story said that GM could also ask for additional government funds to stave off a bankruptcy filing.

The young banker just bought Federal Reserve Chairman Ben Bernanke’s childhood home at a foreclosure sale.

“This is where it all happened,” marvels Mr. Jackson, a 27-year-old loan officer at First Citizens Bancorp, which is down the street from the old Bernanke place. “Kind of a surreal feeling, isn’t it?”

Blackwater said Friday it will no longer operate under the name that came to be known worldwide as a caustic moniker for private security, dropping the tarnished brand for a disarming and simple identity: Xe, which is pronounced like the letter “z.”

It’s a rare surrender for a company that cherished a brand name inspired by the dark-water swamps of northeastern North Carolina, one that survived another rebranding effort about a year ago, following a deadly shooting in Baghdad’s Nisoor Square. The decision to give it up underscores how badly the Moyock-based company’s brand was damaged by that incident and other security work in Iraq.

“They have established themselves as the bad guys,” said Katy Helvenston, who sued the company following her son’s death during a mission in Fallujah while working for Blackwater in 2004. “They’ve established such a horrible reputation. Why else would they change their name?”

Blackwater acknowledged last year in an interview with the The Associated Press the damage to its reputation had persuaded the company to focus on lines of business other than private security contracting.

The issue came to a head last month, when the State Department said it would not rehire Blackwater to protect its diplomats in Iraq after its current contract with the company expires in May. The company has one other major security contract, details of which are classified.

“It’s not a direct result of a loss of (that) contract, but certainly that is an aspect of our work that we feel we were defined by,” said spokeswoman Anne Tyrrell.

The company is also replacing its bear paw logo with a sleeker black-and-white graphic based on letters that make up the company’s new name. In a note to employees, president Gary Jackson said the name change reflects the company’s new focus, and he indicated Xe would not actively pursue new security business.

“This company will continue to provide personnel protective services for high-threat environments when needed by the U.S. government, but its primary mission will be operating our training facilities around the world,” Jackson said.

It has expanded other businesses such as aviation support, recently building a fleet of 76 aircraft that it has deployed to such hotspots as West Africa and Afghanistan. The company got its start in training and continues to build up that business. Last year, some 25,000 civilians, law enforcement and military personnel attended a Blackwater class.

The company’s changes aren’t entirely voluntary. The 2007 shooting in Nisoor Square involving Blackwater guards left at least a dozen Iraqi civilians dead, infuriated politicians in Baghdad and Washington, triggered congressional hearings and increased calls that the company be banned from Iraq.

Late last year, prosecutors charged five of the company’s contractors — but not Blackwater itself — with manslaughter and weapons violations. In January, Iraqi officials said they would not give the company a license to operate. The State Department responded by informing Blackwater it would not renew a contract that comprises a third of the company’s nearly $1 billion in annual revenue.

“It would hurt us,” company CEO Erik Prince said in an interview before losing the State Department deal. “It would not be a mortal blow, but it would hurt us.”

Blackwater has rebranded before, introducing a new name — Blackwater Worldwide — and slight changes to its logo about a year ago. But Friday’s announcement cuts ties entirely with a name created in 1997 when Prince and some of his former Navy SEAL colleagues launched the company.

Xe will cover the parent brand for the two-dozen subsidiaries, and none of those subsidiaries will retain the word “Blackwater” in their names.

Illinois Rep. Jan Schakowsky, chair of the Intelligence Subcommittee on Oversight and Investigations and a longtime Blackwater critic, said the new name won’t change the fact that its actions have resulted in the deaths of innocent civilians.

Now, like many of the foreign workers who make up 90 percent of the population here, she has been laid off and faces the prospect of being forced to leave this Persian Gulf city — or worse.

“I’m really scared of what could happen, because I bought property here,” said Sofia, who asked that her last name be withheld because she is still hunting for a new job. “If I can’t pay it off, I was told I could end up in debtors’ prison.”

With Dubai’s economy in free fall, newspapers have reported that more than 3,000 cars sit abandoned in the parking lot at the Dubai Airport, left by fleeing, debt-ridden foreigners (who could in fact be imprisoned if they failed to pay their bills). Some are said to have maxed-out credit cards inside and notes of apology taped to the windshield.

The government says the real number is much lower. But the stories contain at least a grain of truth: jobless people here lose their work visas and then must leave the country within a month. That in turn reduces spending, creates housing vacancies and lowers real estate prices, in a downward spiral that has left parts of Dubai — once hailed as the economic superpower of the Middle East — looking like a ghost town.

No one knows how bad things have become, though it is clear that tens of thousands have left, real estate prices have crashed and scores of Dubai’s major construction projects have been suspended or canceled. But with the government unwilling to provide data, rumors are bound to flourish, damaging confidence and further undermining the economy.

Instead of moving toward greater transparency, the emirates seem to be moving in the other direction. A new draft media law would make it a crime to damage the country’s reputation or economy, punishable by fines of up to 1 million dirhams (about $272,000). Some say it is already having a chilling effect on reporting about the crisis.

Last month, local newspapers reported that Dubai was canceling 1,500 work visas every day, citing unnamed government officials. Asked about the number, Humaid bin Dimas, a spokesman for Dubai’s Labor Ministry, said he would not confirm or deny it and refused to comment further. Some say the true figure is much higher.

“At the moment there is a readiness to believe the worst,” said Simon Williams, HSBC bank’s chief economist in Dubai. “And the limits on data make it difficult to counter the rumors.”

However, in desperation, Panasonic has hit on the perfect counter-attack against the consumer slump: it has ordered every member of staff to go out and buy £1,000 of Panasonic products.

Large swathes of corporate Japan are expected to follow suit, either by directly commanding or indirectly “pressuring” employees to divert part of their salaries towards the goods that their employers produce.

Toyota has already tacitly applauded a “voluntary” scheme in which 2,200 of its top brass decided to buy new Toyota cars, and the president of Fujitsu recently e-mailed 100,000 staff and gently pointed out how nice it would be if “employee ownership rates” of Fujitsu PCs and mobile phones were a little higher.

The 10,000 Japanese staff affected by Panasonic’s unorthodox strategy do not have long to consider their purchases.

Management insists that staff buy their Panasonic goods — whether they need them or not — by the end of July.

Upper-level managers, all of whom have been “encouraged” for years to fill their homes with Panasonic goods as a symbol of corporate loyalty, are being asked to spend at least 200,000 yen (£1,500).

A Panasonic spokesman said that because the “Buy Panasonic” request was made to management-level employees, the company did not expect refusal rates to be high.

The emergency directive, some Panasonic employees say, is a particularly cruel blow: the same 10,000 managers now being commanded to fork out for unwanted electronics were told two weeks ago that their salaries and bonuses would also be slashed.

The company itself is staring down the barrel of one of its worst annual earnings performances ever, with a Y350 billion flood of red ink expected by the end of the year.

Panasonic said that the move, which is not unprecedented in company history, was aimed at forcing management to “recognise the severity of the current business environment” — a recognition that might have been expected to be in place already, Mitsubishi Tokyo UFJ brokers said.

Only a fortnight ago the company announced plans to close 20 per cent of its factories and cut 15,000 jobs from its global workforce.

Other warning signs from that announcement included pay cuts of between 10 per cent and 20 per cent for directors and 5 per cent for managers.

Even if other Japanese companies are less overtly aggressive about forcing staff to buy their products, many are expecting the Japanese corporate tradition of socially enforced loyalty to kick in and force the issue anyway.

Companies such as Sony and Sharp hold regular discount sales of goods for employees, and sources at both companies have suggested that the most recent events have involved a “clear sense of pressure” to be seen supporting the company by buying its products.

The death was announced by Human Rights Watch, the New York-based advocacy group where Dr. Des Forges, who lived in Buffalo, served as senior adviser for its Africa division.

Dr. Des Forges spent four years interviewing organizers and victims of the Rwandan genocide, in which she estimated that at least 500,000 people died. She testified before the International Criminal Tribunal for Rwanda, based in Arusha, Tanzania, and at trials in Belgium, Switzerland, the Netherlands and Canada. She also appeared on expert panels convened by the United Nations and what is now the African Union, as well as the French and Belgian legislatures and the United States Congress.

The MacArthur Foundation recognized her work with a $375,000 “genius” grant in 1999. Her book “Leave None to Tell the Story: Genocide in Rwanda,” published that year, has been called a definitive account of the genocide.

“Her death is a devastating blow,” Kenneth Roth, the president of Human Rights Watch, wrote in an e-mail message Friday to the organization’s board of directors. “She epitomized the human rights activist — principled, dispassionate, committed to the truth and to using that truth to protect ordinary people.”

Mahmood Mamdani, a professor of government and anthropology at Columbia and the author of a 2001 book, “When Victims Become Killers: Colonialism, Nativism and Genocide in Rwanda,” called her “the leading person who sought to document the events leading up to the Rwandan genocide, so that future generations would have the material on hand to draw the appropriate lessons from it.”

He added, “This was her first commitment. Her second was to identify those responsible for atrocities, no matter what their political affiliation, and to see that justice was done. She was so committed that no amount of political correctness, or displeasure on the part of the authorities, deterred her from this task.”

Scott Straus, a political scientist at the University of Wisconsin at Madison and the author of a 2006 book, “The Order of Genocide: Race, Power and War in Rwanda,” called Dr. Des Forges’s book “a turning point in the documentation and understanding of what happened in the Rwandan genocide.”

In 2001, after a Belgian court sentenced four Rwandans, two of them Roman Catholic nuns, to long prison terms for their roles in the genocide, Dr. Des Forges said she was deeply impressed by the proceedings — the first in which a jury of ordinary citizens was asked to sit in judgment of war crimes in another nation.

“People maybe don’t even realize just how revolutionary this jury trial, so far from the events, really is,” she told The New York Times then. The Belgian trial, she said, “has been done with a great deal more depth than those in Rwanda.”

Dr. Des Forges was also an authority on human rights violations in Burundi and the Democratic Republic of Congo, formerly Zaire.

Before the genocide, Dr. Des Forges was part of a group convened by Human Rights Watch and other organizations that examined rights abuses, including killings and attacks and kidnappings of civilians, in Rwanda from 1990 to 1993.

“She was a volunteer, and eventually the executive director forced her to take a salary,” said Emma Daly, communications director at Human Rights Watch.

After the genocide began in April 1994, Dr. Des Forges helped persuade diplomats in Kigali, the Rwandan capital, to move several Rwandans to safety, including a human rights advocate, Monique Mujawamariya.

While a central focus of her work was documenting the crimes of the Hutu-led government that organized the three-month-long genocide, Dr. Des Forges later leveled strong criticism of the Rwandan Patriotic Front, the Tutsi-dominated regime led by Paul Kagame, Rwanda’s president, which has been in power since the genocide. Dr. Des Forges was among critics who accused that regime of massacring thousands of Rwandan civilians in 1994, of killing civilians and refugees in the eastern Congo in 1996 and 1997 and of making repeated military interventions in the Congo.

Alison B. Liebhafsky was born on Aug. 20, 1942, in Schenectady, N.Y., the daughter of Herman A. Liebhafsky, a chemist, and Sybil Small. She graduated from Radcliffe College in 1964, and received a master’s degree in 1966 and a doctorate in 1972, both in history, from Yale. Her master’s thesis focused on the impact of European colonization on Rwanda’s social system, and her doctoral dissertation was about Yuhi Musinga, the mwami, or ruler, of Rwanda from 1896 to 1931, during which Germany, and later Belgium, colonized Rwanda. She was fluent in French.

The documents, obtained by the ACLU under a Freedom of Information Act request, contain a report by Vice Admiral Albert T. Church, who was tapped to conduct a comprehensive review of Defense Department interrogation operations. Church specifically calls out interrogations at Bagram Air base in Afghanistan as “clearly abusive, and clearly not in keeping with any approved interrogation policy or guidance.”

The two unredacted pages from the Church report may be found here.

The ACLU’s release comes on the same day as a major FOIA document dump by three other leading human rights groups: Documents which reveal the Pentagon ran secret prisons in Bagram and Iraq, that it cooperated with the CIA’s “ghost detention” program and that Defense personnel delayed a prisoner’s release to avoid bad press.

“In both cases, for example, [prisoners] were handcuffed to fixed objects above their heads in order to keep them awake,” reads the document. “Additionally, interrogations in both incidents involved the use of physical violence, including kicking, beating, and the use of “compliance blows” which involved striking the [prisoners] legs with the [interrogators] knees. In both cases, blunt force trauma to the legs was implicated in the deaths. In one case, a pulmonary embolism developed as a consequence of the blunt force trauma, and in the other case pre-existing coronary artery disease was complicated by the blunt force trauma.”

In a press release, the ACLU summarized the documents as detailing, “[An] investigation of two deaths at Bagram. Both detainees were determined to have been killed by pulmonary embolism caused as a result of standing chained in place, sleep depravation and dozens of beatings by guards and possibly interrogators. (Also reveals the use of torture at Gitmo and American-Afghani prisons in Kabul).

“[An] investigation into the homicide or involuntary manslaughter of detainee Dilar Dababa by U.S. forces in 2003 in Iraq.

“[An] investigation launched after allegations that an Iraqi prisoner was subjected to torture and abuse at ‘The Disco’ (located in the Special Operations Force Compound in Mosul Airfield, Mosul, Iraq). The abuse consisted of filling his jumpsuit with ice, then hosing him down and making him stand for long periods of time, sometimes in front of an air conditioner; forcing him to lay down and drink water until he gagged, vomited or choked, having his head banged against a hot steel plate while hooded and interrogated; being forced to do leg lifts with bags of ice placed on his ankles, and being kicked when he could not do more.

“[An] investigation of allegations of torture and abuse that took place in 2003 at Abu Ghraib.

“[And an] investigation that established probable cause to believe that U.S. forces committed homicide in 2003 when they participated in the binding of detainee Abed Mowhoush in a sleeping bag during an interrogation, causing him to die of asphyxiation.”

“A large portion of the torture, maiming, and murder of detainees occurred under authority issued under secret rules of engagement in the Pentagon,” wrote Scott Horton, a contributing editor with Harper’s magazine. “Much of this flowed through Undersecretary of Defense for Intelligence Stephen Cambone, a figure who has so far evaded scrutiny in the torture scandal and now serves as vice president for strategy of QinetiQ North America, a subsidiary of the United Kingdom-based defense contractor QinetiQ. Even the Senate Armed Services Committee review fails to get to the bottom of Dr. Cambone, his interrogations ROEs for special operations units he controlled, and the death, disfigurement and torture of prisoners they handled. This is one of many reasons why a comprehensive investigation with subpoena power is urgently needed. But full airing of the internal investigations already conducted by the Department of Defense is an essential next step.”

The U.S. military failed to “maintain complete inventory records for an estimated 87,000 weapons — or about 36 percent — of the 242,000 weapons that the United States procured and shipped to Afghanistan from December 2004 through June 2008,” a U.S. Government Accountability Office report states.

“Accountability lapses occurred throughout the supply chain,” it says.

The Defense Department spent roughly $120 million during that period to acquire a range of small arms and light weapons for the Afghan National Security Forces, including rifles, machine guns and rocket-propelled grenade launchers.

The military also failed to properly account for an additional 135,000 weapons it obtained for the Afghan forces from 21 other countries.

“What if we had to tell families [of U.S. soldiers] not only why we are in Afghanistan but why their son or daughter died at the hands of an insurgent using a weapon purchased by the United States taxpayers? But that’s what we risk if we were to have tens of thousands of weapons we provided washing around Afghanistan, off the books,” Rep. John Tierney, D-Massachusetts, chairman of the House Subcommittee on National Security and Foreign Affairs, said at the start of a congressional hearing on the report.

The military is unable to provide serial numbers for 46,000 of the missing 87,000 weapons, the report concludes. No records have been maintained for the location or disposition for the other 41,000 weapons.

The report urges Defense Secretary Robert Gates to “establish clear accountability procedures for weapons while they are in the control and custody of the United States” and direct those “involved in providing these weapons to track (them) by serial number and conduct routine physical inventories.”

The GAO review comes as numerous senior officials — including President Obama — are expressing serious concern over the deteriorating security situation in Afghanistan. On Wednesday, eight Taliban suicide attackers struck Afghan government buildings and a prison in Kabul, killing at least 19 people in a coordinated attack that the Taliban said was in retaliation for the mistreatment of prisoners, according to Afghan officials.

The attacks raised new questions over the effectiveness of the ongoing $16.5 billion U.S. effort to train and equip Afghan security forces. Officials from the State and Defense departments intend to request an additional $5.7 billion in assistance for the Afghan army and police in fiscal year 2009, according to the report.