The Global Template for Collapse: The Enchanting Charms of Cheap, Easy Credit

Charles Hugh Smith
Of Two Minds : June 29, 2015

Cheap, easy credit has created moral hazard and nurtured magical thinking throughout the global economy.

According to polls, the majority of Greek citizens want the benefits of membership in the euro/EU and the end of EU-imposed austerity. The idea that these are mutually exclusive doesn’t seem to register.

This is the discreet charm of magical thinking: it promises an escape from the difficulties of hard choices, tough trade-offs, the disruption of vested interests and most painfully, the breakdown of the debt machine that has enabled the distribution of swag to virtually everyone in the system (a torrent to those at the top, a trickle to the majority at the bottom, but swag nonetheless).

If we had to summarize the insidious charm of magical thinking, we might start with the overpowering appeal of using credit to ease all difficulties.

Need money to fund various healthcare/national defense rackets? Borrow the money. Need to keep people employed building ghost cities in the middle of nowhere? Borrow the money. Need to keep buying shares of the company’s stock to push the value of each share ever higher? Borrow the money.

The problem with cheap, easy credit is Cheap, easy credit destroys discipline. The lifetime costs of debt taken on to fund bridges to nowhere, healthcare/national defense rackets, ghost cities, stock buybacks, etc. are never calculated. The opportunity costs are also never calculated.

When credit is costly and hard to get, marginal borrowers can’t get loans and nobody dares borrow at high rates of interest for low-yield, high-risk schemes. When credit is costly and hard to get, what doesn’t pencil out doesn’t get funded.

When credit is cheap and easy to get, every scheme and racket gets funding because hey, why not? The cost is low (at the moment) and the gain might be fantastic. But even if the gain is unknown, the kickback/campaign contributions make it worthwhile even if the scheme fails.

Professional economists are duty-bound to claim national economies are not merely extensions of households. But this is just another falsity passed off as sophisticated truth by a profession that is being discredited by the reality of its failed policies, failed theories and failed predictions.

Since human psychology remains the dominant force in all economics, the household and national economies can only differ in scale.

In the 1970s, credit was scarce and hard to get. Young workers qualified for a $300 limit credit card, and it took careful management of that responsibility (always paying on time, etc.) to get a meager increase to $500. Mortgage rates were high (10%+) and your income and household balance sheet were scrutinized before any lender took a chance on lending you tens of thousands of dollars to buy a house. After all, the bank would be stuck with the losses if you defaulted.

Then came financialization. Banks could skim the profits from originating loans and offload the risk of default onto towns in Norway, credulous pension funds and other greater fools.

And if a default threatened the bank–for example, Greece in 2011–the bank simply bought political power and shifted the debt onto taxpayers. “The ATMs will stop working,” the bankers threatened their political flunkies in Congress in 2008, and the bought-and-paid-for toadies in Congress and the Federal Reserve obediently shifted trillions of dollars in private liabilities and sketchy debt-based “assets” such as mortgages onto the taxpayers and the Fed balance sheet.

The same transfer of risk and losses occurred in Europe, as these charts demonstrate: (Source: If Greece Defaults, Europe’s Taxpayers Lose)

Here is the debt in 2009–mostly owed to private banks and bondholders:

Here is the debt in 2015–almost all was shifted onto the backs of taxpayers:

 

Ask yourself this: if you could shift risk and losses to the taxpayers, how would that affect your investing/gambling? Wouldn’t you take much higher risks, knowing that losses would not fall to you but to abstract taxpayers? Of course you would, and this is the essence of moral hazard–the disconnect of risk and consequence.

Cheap, easy credit has created moral hazard and nurtured magical thinking throughout the global economy. The heart of magical thinking is that consequences have been disappeared or shifted onto others by financial enchantment.

(Read the full article at of two minds)

Vancouver’s Gangster Government Creates Legal Extortion Racket: Demands $30K From Each Pot Shop

AlternativeFreePress.com

Today, The City of Vancouver Council voted in favor of new regulations for the growing number of medical Cannabis dispensaries in the city. The new bylaws demand $30,000 from each dispensary. The new rules also restrict the location such businesses may operate within, which means dozens are now already in violation.

Councillor Kerry Jang has threatened that the city and/or their police force will shut down dispensaries which do not pay or violate other rules.

City Council claims it is the asinine position of Canada’s Health Minister Rona Ambrose which is forcing the hand of Vancouver’s Councillors. While her portfolio includes legal responsibility for medical marijuana access in Canada, she ridiculously claims cannabis does not have medical value and has failed to provide Canadians with access to their medicine as dictated by the Supreme Court. Now, this blame of failing to provide access is valid, but it does not justify demanding $30,000 with the threat of a police raid. The city could and should regulate dispensaries similarly to other businesses, but $30,000 is ridiculous. That $30,000 cost will of course be passed on to patients who are already paying too much.

The City of Vancouver charges liquor-serving establishments from $858.00 to a maximum $4,637.00 to process their licenses, while alcohol is more dangerous, more addictive, and significantly more damaging to health than Cannabis. A $5000 licensing fee might be reasonable, but $30,000 to dispense medicine to sick people is essentially extortion.

Written by Alternative Free Press
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Vancouver’s Gangster Government Creates Legal Extortion Racket: Demands 30K From Each Pot Shop by AlternativeFreePress.com is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

SOURCES:
Vancouver.ca
CannabisCulture.com
CBC.ca

Ukraine’s President Poroshenko Admits Overthrow Of Yanukovych Was A Coup

Eric Zuesse
Zero Hedge: June 23, 2015

Ukraine’s President Petro Poroshenko requests the supreme court of Ukraine to declare that his predecessor, Viktor Yanukovych, was overthrown by an illegal operation; in other words, that the post-Yanukovych government, including Poroshenko’s own Presidency, came into power from a coup, not from something democratic, not from any authentic constitutional process at all.

In a remarkable document, which is not posted at the English version of the website of the Constitutional Court of Ukraine, but which is widely reported outside the United States, including Russia, Poroshenko, in Ukrainian (not in English), has petitioned the Constitutional Court of Ukraine (as it is being widely quoted in English):

“I ask the court to acknowledge that the law ‘on the removal of the presidential title from Viktor Yanukovych’ as unconstitutional.”

I had previously reported, and here will excerpt, Poroshenko’s having himself admitted prior to 26 February 2014, to the EU’s investigator, and right after the February 22nd overthrow of Yanukovych, that the overthrow was a coup, and that it was even a false-flag operation, in which the snipers, who were dressed as if they were Ukrainian Security Bureau troops, were actually not, and that, as the EU’s investigator put his finding to the EU’s chief of foreign affairs Catherine Ashton [and with my explanatory annotations here]:

“the same oligarch [Poroshenko — and so when he became President he already knew this] told that well, all the evidence shows that the people who were killed by snipers, from both sides, among policemen and people from the streets, [this will shock Ashton, who had just said that Yanukovych had masterminded the killings] that they were the same snipers, killing people from both sides [so, Poroshenko himself knows that his regime is based on a false-flag U.S.-controlled coup d’etat against his predecessor]. … Behind the snipers, it was not Yanukovych, but it was somebody from the new coalition.”

This was when Ashton first learned that the myth that Yanukovych had been overthrown as a result of public outrage at his having rejected the EU’s offer of membership to Ukraine was just a hoax. (Actually, the planning for this coup was already under way in the U.S. Embassy by at least early 2013, well prior to Yanukovych’s EU decision. Furthermore, the Ukrainian public’s approval of the government peaked right after Yanukovych announced his rejection of the EU’s offer, but then the U.S.-engineered “Maidan” riots caused that approval to plunge.)

If the Court grants Poroshenko’s petition, then the appointment of Arseniy Yatsenyuk by the U.S. State Department’s Victoria Nuland on 4 February 2014, which was confirmed by the Ukrainian parliament (or Rada) at the end of the coup on February 26th, and the other appointments which were made, including that of Oleksandr Turchynov to fill in for Yanukovych as caretaker President until one of the junta’s chosen candidates would be ‘elected’ on May 25th of 2014, which ‘election’ Poroshenko won — all of this was illegal.

However, this illegality had already been known. It was already explained in detail on 28 February 2014, that, “Yanukovych’s removal was unconstitutional.” That’s for lawyers; but, now, finally, Ukraine’s Constitutional Court is faced with the shocking predicament of Ukraine’s own President, who won his post as a result of this coup, requesting them to “acknowledge” that it was a coup, much as the founder of the “private CIA” firm Stratfor had even called it, “the most blatant coup in history.” (It was that because the authentic video and other evidence of its having been a Washington job was so massive.)

Also in the news now is that Dmitriy Yarosh’s Right Sector — the same group that Washington had hired for the coup and for the ethnic cleansing campaign in Ukraine’s former Donbass region — have announced that they will assemble in Kiev on July 3rd to overthrow Petroshenko unless he restarts right now the war against Donbass. The people whom Washington paid to oust Yanukovych are planning to do the same to Poroshenko. There is a struggle inside the Obama Administration about how far they can successfully go with their Ukrainian nazis not formally leading the country. Washington is having a hard time keeping in line the Ukrainian nazis upon whom Washington’s plan for Ukraine has been based.

zero hedge

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Leaked intelligence reports show NSA spied on three French presidents

Today, 23 June 2015, WikiLeaks began publishing “Espionnage Élysée”, a collection of TOP SECRET intelligence reports and technical documents from the US National Security Agency (NSA) concerning targeting and signals intelligence intercepts of the communications of high-level officials from successive French governments over the last ten years.

The top secret documents derive from directly targeted NSA surveillance of the communications of French Presidents Francois Hollande (2012–present), Nicolas Sarkozy (2007–2012), and Jacques Chirac (1995–2007), as well as French cabinet ministers and the French Ambassador to the United States. The documents also contain the “selectors” from the target list, detailing the cell phone numbers of numerous officials in the Elysee up to and including the direct cell phone of the President.

Prominent within the top secret cache of documents are intelligence summaries of conversations between French government officials concerning some of the most pressing issues facing France and the international community, including the global financial crisis, the Greek debt crisis, the leadership and future of the European Union, the relationship between the Hollande administration and the German government of Angela Merkel, French efforts to determine the make-up of the executive staff of the United Nations, French involvement in the conflict in Palestine and a dispute between the French and US governments over US spying on France.

A founding member state of the European Union and one of the five permanent members of the UN Security Council, France is formally a close ally of the United States, and plays a key role in a number of US-associated international institutions, including the Group of 7 (G7), the North Atlantic Treaty Organization (NATO) and the World Trade Organization (WTO).

The revelation of the extent of US spying against French leaders and diplomats echoes a previous disclosure in the German press concerning US spying on the communications of German Chancellor Angela Merkel and other German officials. That disclosure provoked a political scandal in Germany, eventuating in an official inquiry into German intelligence co-operation with the United States, which is still ongoing.

While the German disclosures focused on the isolated fact that senior officials were targeted by US intelligence, WikiLeaks’ publication today provides much greater insight into US spying on its allies, including the actual content of intelligence products deriving from the intercepts, showing how the US spies on the phone calls of French leaders and ministers for political, economic and diplomatic intelligence.

WikiLeaks founder Julian Assange said: “The French people have a right to know that their elected government is subject to hostile surveillance from a supposed ally. We are proud of our work with leading French publishers Liberation and Mediapart to bring this story to light. French readers can expect more timely and important revelations in the near future.”

Source:

Radioactive cesium levels in Fukushima river seasonal: study

Mainichi

Radioactive cesium contamination levels in a river near the Fukushima No. 1 nuclear plant rise in the spring and fall in the autumn, a new study shows.

The researchers believe the rise is attributable to very large numbers of leaves containing radioactive substances falling into rivers in the spring. In one year, the radioactive cesium level in the river in springtime was up to five times that in autumn.

Hirokazu Ozaki, research team leader and assistant professor at Tokyo University of Agriculture and Technology, said, “There is a possibility that radioactive substances are concentrated in the bodies of fish through the food chain, so it’s important to grasp what’s happening in the rivers. This study is unprecedented, and we’d like to continue.”

A group of Tokyo University of Agriculture and Technology researchers analyzed sediment samples taken at 35 locations along the middle reaches of the Abukuma River in Fukushima Prefecture, 40-50 kilometers from the atomic power station, in spring and autumn from 2012 to 2014.

The average density of radioactive cesium-137 per kilogram of sediment was 1,450 becquerels in spring 2012, 1,270 becquerels in autumn 2012, 2,700 becquerels in spring 2013, 451 becquerels in autumn 2013, 1,080 becquerels in spring 2014 and 600 becquerels in autumn 2014.

The highest level was 22,800 becquerels at one location in spring 2013, and there is a wide variation from location to location.

According to researchers, fallen leaves and carcasses of animals containing concentrated radioactive materials fall into the river in spring, increasing the amount of radioactive cesium in the river.

-read the full article at Mainichi(en)-

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Buying Silence: How the Saudi Foreign Ministry controls Arab media

Wikileaks

On Monday, Saudi Arabia celebrated the beheading of its 100th prisoner this year. The story was nowhere to be seen on Arab media despite the story’s circulation on wire services. Even international media was relatively mute about this milestone compared to what it might have been if it had concerned a different country. How does a story like this go unnoticed?

Today’s release of the WikiLeaks “Saudi Cables” from the Saudi Ministry of Foreign Affairs show how it’s done.

The oil-rich Kingdom of Saudi Arabia and its ruling family take a systematic approach to maintaining the country’s positive image on the international stage. Most world governments engage in PR campaigns to fend off criticism and build relations in influential places. Saudi Arabia controls its image by monitoring media and buying loyalties from Australia to Canada and everywhere in between.

Documents reveal the extensive efforts to monitor and co-opt Arab media, making sure to correct any deviations in regional coverage of Saudi Arabia and Saudi-related matters. Saudi Arabia’s strategy for co-opting Arab media takes two forms, corresponding to the “carrot and stick” approach, referred to in the documents as “neutralisation” and “containment”. The approach is customised depending on the market and the media in question.

“Contain” and “Neutralise”

The initial reaction to any negative coverage in the regional media is to “neutralise” it. The term is used frequently in the cables and it pertains to individual journalists and media institutions whose silence and co-operation has been bought. “Neutralised” journalists and media institutions are not expected to praise and defend the Kingdom, only to refrain from publishing news that reflects negatively on the Kingdom, or any criticism of its policies. The “containment” approach is used when a more active propaganda effort is required. Journalists and media institutions relied upon for “containment” are expected not only to sing the Kingdom’s praises, but to lead attacks on any party that dares to air criticisms of the powerful Gulf state.

One of the ways “neutralisation” and “containment” are ensured is by purchasing hundreds or thousands of subscriptions in targeted publications. These publications are then expected to return the favour by becoming an “asset” in the Kingdom’s propaganda strategy. A document listing the subscriptions that needed renewal by 1 January 2010 details a series of contributory sums meant for two dozen publications in Damascus, Abu Dhabi, Beirut, Kuwait, Amman and Nouakchott. The sums range from $500 to 9,750 Kuwaiti Dinars ($33,000). The Kingdom effectively buys reverse “shares” in the media outlets, where the cash “dividends” flow the opposite way, from the shareholder to the media outlet. In return Saudi Arabia gets political “dividends” – an obliging press.

An example of these co-optive practices in action can be seen in an exchange between the Saudi Foreign Ministry and its Embassy in Cairo. On 24 November 2011 Egypt’s Arabic-language broadcast station ONTV hosted the Saudi opposition figure Saad al-Faqih, which prompted the Foreign Ministry to task the embassy with inquiring into the channel. The Ministry asked the embassy to find out how “to co-opt it or else we must consider it standing in the line opposed to the Kingdom’s policies“.

The document reports that the billionaire owner of the station, Naguib Sawiris, did not want to be “opposed to the Kingdom’s policies” and that he scolded the channel director, asking him “never to host al-Faqih again”. He also asked the Ambassador if he’d like to be “a guest on the show”.

The Saudi Cables are rife with similar examples, some detailing the figures and the methods of payment. These range from small but vital sums of around $2000/year to developing country media outlets – a figure the Guinean News Agency “urgently needs” as “it would solve many problems that the agency is facing” – to millions of dollars, as in the case of Lebanese right-wing television station MTV.

Confrontation

The “neutralisation” and “containment” approaches are not the only techniques the Saudi Ministry is willing to employ. In cases where “containment” fails to produce the desired effect, the Kingdom moves on to confrontation. In one example, the Foreign Minister was following a Royal Decree dated 20 January 2010 to remove Iran’s new Arabic-language news network, Al-Alam, from the main Riyadh-based regional communications satellite operator, Arabsat. After the plan failed, Saud Al Faisal sought to “weaken its broadcast signal“.

The documents show concerns within the Saudi administration over the social upheavals of 2011, which became known in the international media as the “Arab Spring”. The cables note with concern that after the fall of Mubarak, coverage of the upheavals in Egyptian media was “being driven by public opinion instead of driving public opinion”. The Ministry resolved “to give financial support to influential media institutions in Tunisia“, the birthplace of the “Arab Spring”.

The cables reveal that the government employs a different approach for its own domestic media. There, a wave of the Royal hand is all that is required to adjust the output of state-controlled media. A complaint from former Lebanese Prime Minister and Saudi citizen Saad Hariri concerning articles critical of him in the Saudi-owned Al-Hayat and Asharq Al-Awsat newspapers prompted a directive to “stop these type of articles” from the Foreign Ministry.

This is a general overview of the Saudi Foreign Ministry’s strategy in dealing with the media. WikiLeaks’ Saudi Cables contain numerous other examples that form an indictment of both the Kingdom and the state of the media globally.

Source: wikileaks

VIDEO shows police tasering and choking 13-year-old boy

San Diego Union-Tribune says:

The struggle, which occurred around 5:30 p.m. behind a grocery store on South Mission Road near Ammunition Road, was videotaped by an onlooker with a cellphone and posted online Sunday. A sheriff’s spokeswoman said the deputy used his Taser after being bit on the hand by the boy during a struggle.

The video shows the teen on the ground, leaning against the deputy, who is on his knees, when the deputy puts his Taser up against his back and stuns him. Onlookers can be heard yelling profanities, with one shouting, “he’s a kid” and another saying, “police brutality right here.” A voice also can be heard saying, “You’re going to get sued, dude.”

A witness explained to FilmingCops.com:

The child was 13-yrs-old (on the video other witnesses assume he’s “15 or 16″ but according to the source he is in fact 13). He was riding on his skateboard with other young boys behind a shopping center, and there happened to be a patrol car parked nearby.

At some point an officer inside of the patrol car told the 13-yr-old child to “get in the car.”

The child replied, “Why?”

The officer then warned, “You don’t want to get dropped.”

The officer apparently knew the boy was only 13 and not suspected of criminal wrongdoing as the San Diego Union-Tribune reported:

Sheriff’s Department spokeswoman Jan Caldwell said the incident began when a woman reported that her son had been missing about a day and a half. A deputy went to her home and found out from the woman where her son liked to hang out. The deputy found the boy behind the store with a group of youths riding skateboards.

“He approached him, identified him, verified who he was and said he had to come with him,” Caldwell said. “The juvenile refused.

The Free Thought Project says

According to witnesses, the officer then attacked the boy, hitting him from behind as the boy was skateboarding. He then got on the boys back and began choking him, according to witnesses. The video shows the choking and the subsequent tasering to the child’s spine.

The boy can be heard in the video writhing in pain as the officer attempts to subdue him.

“Put your fucking hands behind your back!” shouts the officer. To which the child replies, “I can’t.”

The witnesses can be heard telling the officer, “He’s just a kid.”

The officer then loads the beaten and tasered child into his patrol car and begins walking towards the people filming. The video then ends.

According to the witnesses, the officer then proceeded to confiscate everyone’s cellphones and deleted their video. This one video below managed to make it out.

This Is What A Volcker Rule Loophole Looks Like

Daniel Drew
dark-bid: June 14, 2015

After the carnage of the 2008 crash, former Federal Reserve Chairman Paul Volcker proposed a rule that would prevent banks from making short-term proprietary trades with financial instruments. In other words, no gambling allowed. This rule would become known as The Volcker Rule, and it went into partial effect on April 1, 2014. Full compliance is required by July 21, 2015. Of course, the bank lobbyists were hard at work, and numerous exceptions and loopholes were created. The definition of “financial instruments” did not include currencies, despite the fact that currencies are the basis of the modern financial system and should be considered the ultimate financial instrument. Also, banks were allowed to “hedge” their risks. As JPMorgan demonstrated in 2012, apparently, it is possible to lose $6 billion while hedging risks with credit derivatives.

JPMorgan is at it again – this time, with the Swiss franc. On January 15 of this year, the Swiss Central Bank sent shockwaves around the financial world when they abruptly abandoned the 1.20 EURCHF floor.

The Wall Street Journal reported that JPMorgan made up to $300 million in the ensuing trading chaos. With the FX market facing a severe shortage of liquidity, JPMorgan stepped in. However, as with any illiquid market, the dealers call the shots. Bid/ask spreads can explode, creating enormous transaction costs for anyone who has to trade. These parties included desperate retail FX brokers and small clients who were bankrupted by the Swiss central bankers. As the WSJ reported,

J.P. Morgan filled client orders at a certain rate, allowing them to quickly assess their position and continue trading when liquidity dried up in the market, this person said. The bank told clients it would fill orders at 1.02 francs per euro while the Swiss currency grew from 1.20 francs per euro to nearly .85 on Jan. 15, the person said. It is unclear how long the bank offered this rate to clients.

By setting the fill 15% away from the last price, JPMorgan was able to lock in any gains from a long franc position instantly. It also gave the firm’s traders an anchor so they knew where they were at. What if the clients could get a more advantageous rate at another bank? It didn’t matter. 1.02 was the price. If JPMorgan’s traders saw a better rate elsewhere, they could trade with that third party and effectively arbitrage the market against their own clients. Of course, it was all transparent. You knew you were getting 1.02, but if your bankrupt broker is margin calling you at any price, there’s not much you can do. It was JPMorgan’s market.

The chaos of the Swiss bank bluff showed up in JPMorgan’s first quarter report. In the trading section that reports the firm’s value at risk, January 15 stands out like LeBron James in his 5th grade class picture.

JPMorgan VAR

With free reign to trade currencies and under the guise of “market making,” JPMorgan raped the accounts of retail FX brokers and small clients who never could have imagined that the Swiss Central Bank would turn the stable franc into one of the most volatile currencies of the decade. It also appears that The Wall Street Journal overstated the $300 million headline number. According to JPMorgan, they made about $200 million that day.

The fact that JPMorgan still takes value at risk (VAR) seriously is another irony. Wall Street anti-hero Nassim Taleb has made multiple fortunes betting on improbable events via out-of-the-money put options, and he remains one of the most steadfast critics of VAR. Taleb has an arcane style of communication, but the summary of his criticism is that VAR is based on the normal distribution, which underestimates the effects of extreme price moves. Furthermore, the very idea that wild events can be predicted by any model is an arrogant assumption, according to Taleb. A white paper by the Chicago Board Options Exchange (CBOE) verifies Taleb’s assertions.

(read the full article at dark-bid)

The Sunday Times’ Snowden Story is Journalism at its Worst — and Filled with Falsehoods

Glenn Greenwald
The Intercept: June 14, 2015

Western journalists claim that the big lesson they learned from their key role in selling the Iraq War to the public is that it’s hideous, corrupt and often dangerous journalism to give anonymity to government officials to let them propagandize the public, then uncritically accept those anonymously voiced claims as Truth. But they’ve learned no such lesson. That tactic continues to be the staple of how major U.S. and British media outlets “report,” especially in the national security area. And journalists who read such reports continue to treat self-serving decrees by unnamed, unseen officials — laundered through their media — as gospel, no matter how dubious are the claims or factually false is the reporting.

We now have one of the purest examples of this dynamic. Last night, the Murdoch-owned Sunday Times published their lead front-page Sunday article, headlined “British Spies Betrayed to Russians and Chinese.” Just as the conventional media narrative was shifting to pro-Snowden sentiment in the wake of a key court ruling and a new surveillance law, the article (behind a paywall: full text here) claims in the first paragraph that these two adversaries “have cracked the top-secret cache of files stolen by the fugitive U.S. whistleblower Edward Snowden, forcing MI6 to pull agents out of live operations in hostile countries, according to senior officials in Downing Street, the Home Office and the security services.” It continues:

Western intelligence agencies say they have been forced into the rescue operations after Moscow gained access to more than 1m classified files held by the former American security contractor, who fled to seek protection from Vladimir Putin, the Russian president, after mounting one of the largest leaks in US history.

Senior government sources confirmed that China had also cracked the encrypted documents, which contain details of secret intelligence techniques and information that could allow British and American spies to be identified.

One senior Home Office official accused Snowden of having “blood on his hands,” although Downing Street said there was “no evidence of anyone being harmed.”

Aside from the serious retraction-worthy fabrications on which this article depends — more on those in a minute — the entire report is a self-negating joke. It reads like a parody I might quickly whip up in order to illustrate the core sickness of Western journalism.

Unless he cooked an extra-juicy steak, how does Snowden “have blood on his hands” if there is “no evidence of anyone being harmed?” As one observer put it last night in describing the government instructions these Sunday Times journalists appear to have obeyed: “There’s no evidence anyone’s been harmed but we’d like the phrase ‘blood on his hands’ somewhere in the piece.”

The whole article does literally nothing other than quote anonymous British officials. It gives voice to banal but inflammatory accusations that are made about every whistleblower from Daniel Ellsberg to Chelsea Manning. It offers zero evidence or confirmation for any of its claims. The “journalists” who wrote it neither questioned any of the official assertions nor even quoted anyone who denies them. It’s pure stenography of the worst kind: some government officials whispered these inflammatory claims in our ears and told us to print them, but not reveal who they are, and we’re obeying. Breaking!

Stephen Colbert captured this exact pathology with untoppable precision in his 2006 White House Correspondents speech, when he mocked American journalism to the faces of those who practice it:

But, listen, let’s review the rules. Here’s how it works.The President makes decisions. He’s the decider. The press secretary announces those decisions, and you people of the press type those decisions down. Make, announce, type. Just put ’em through a spell check and go home. Get to know your family again. Make love to your wife. Write that novel you got kicking around in your head. You know, the one about the intrepid Washington reporter with the courage to stand up to the administration? You know, fiction!

The Sunday Times article is even worse because it protects the officials they’re serving with anonymity. The beauty of this tactic is that the accusations can’t be challenged. The official accusers are being hidden by the journalists so nobody can confront them or hold them accountable when it turns out to be false. The evidence can’t be analyzed or dissected because there literally is none: they just make the accusation and, because they’re state officials, their media-servants will publish it with no evidence needed. And as is always true, there is no way to prove the negative. It’s like being smeared by a ghost with a substance that you can’t touch.

This is the very opposite of journalism. Ponder how dumb someone has to be at this point to read an anonymous government accusation, made with zero evidence, and accept it as true.

But it works. Other news agencies mindlessly repeated the Sunday Times claims far and wide. I watched last night as American and British journalists of all kinds reacted to the report on Twitter: by questioning none of it. They did the opposite: they immediately assumed it to be true, then spent hours engaged in somber, self-serious discussions with one another over what the geopolitical implications are, how the breach happened, what it means for Snowden, etc. This is the formula that shapes their brains: anonymous self-serving government assertions = Truth. 

By definition, authoritarians reflexively believe official claims — no matter how dubious or obviously self-serving, even when made while hiding behind anonymity — because that’s how their submission functions. Journalists who practice this sort of primitive reporting — I uncritically print what government officials tell me, and give them anonymity so they have no accountability for any it — do so out of a similar authoritarianism, or uber-nationalism, or laziness, or careerism. Whatever the motives, the results are the same: government officials know they can propagandize the public at any time because subservient journalists will give them anonymity to do so and will uncritically disseminate and accept their claims.

At this point, it’s hard to avoid the conclusion that journalists want it this way. It’s impossible that they don’t know better. The exact kinds of accusations laundered in the Sunday Times today are made — and then disproven — in every case where someone leaks unflattering information about government officials.

In the early 1970s, Nixon officials such as John Ehrlichman and Henry Kissinger planted accusations in the U.S. media that Daniel Ellsberg had secretly given the Pentagon Papers and other key documents to the Soviet Union; everyone now knows this was a lie, but at the time, American journalists repeated it constantly, helping to smear Ellsberg. That’s why Ellsberg has constantly defended Snowden and Chelsea Manning from the start: because the same tactics were used to smear him.

The same thing happened with Chelsea Manning. When WikiLeaks first began publishing the Afghan War logs, U.S. officials screamed that they — all together now — had “blood on their hands.” But when some journalists decided to scrutinize rather than mindlessly repeat the official accusation (i.e., some decided to do journalism), they found it was a fabrication. […]

An AP report was headlined “AP review finds no WikiLeaks sources threatened,” and explained that “an Associated Press review of those sources raises doubts about the scope of the danger posed by WikiLeaks’ disclosures and the Obama administration’s angry claims, going back more than a year, that the revelations are life-threatening.” Months earlier, McClatchy’s Nancy Youssef wrote an article headlined “Officials may be overstating the dangers from WikiLeaks,” and she noted that “despite similar warnings ahead of the previous two massive releases of classified U.S. intelligence reports by the website, U.S. officials concede that they have no evidence to date that the documents led to anyone’s death.”

Now we have exactly the same thing here. There’s an anonymously made claim that Russia and China “cracked the top-secret cache of files” from Snowden’s, but there is literally zero evidence for that claim. These hidden officials also claim that American and British agents were unmasked and had to be rescued, but not a single one is identified. There is speculation that Russia and China learned things from obtaining the Snowden files, but how could these officials possibly know that, particularly since other government officials are constantly accusing both countries of successfully hacking sensitive government databases?

What kind of person would read evidence-free accusations of this sort from anonymous government officials — designed to smear a whistleblower they hate — and believe them? That’s a particularly compelling question given that Vice’s Jason Leopold just last week obtained and published previously secret documents revealing a coordinated smear campaign in Washington to malign Snowden. Describing those documents, he reported: “A bipartisan group of Washington lawmakers solicited details from Pentagon officials that they could use to ‘damage’ former NSA contractor Edward Snowden’s ‘credibility in the press and the court of public opinion.’”

Manifestly then, the “journalism” in this Sunday Times article is as shoddy and unreliable as it gets. Worse, its key accusations depend on retraction-level lies.

The government accusers behind this story have a big obstacle to overcome: namely, Snowden has said unequivocally that when he left Hong Kong, he took no files with him, having given them to the journalists with whom he worked, and then destroying his copy precisely so that it wouldn’t be vulnerable as he traveled. How, then, could Russia have obtained Snowden’s files as the story claims — “his documents were encrypted but they weren’t completely secure ” — if he did not even have physical possession of them?

The only way this smear works is if they claim Snowden lied, and that he did in fact have files with him after he left Hong Kong. The Sunday Times journalists thus include a paragraph that is designed to prove Snowden lied about this, that he did possess these files while living in Moscow:

It is not clear whether Russia and China stole Snowden’s data, or whether he voluntarily handed over his secret documents in order to remain at liberty in Hong Kong and Moscow.

David Miranda, the boyfriend of the Guardian journalist Glenn Greenwald, was seized at Heathrow in 2013 in possession of 58,000 “highly classified” intelligence documents after visiting Snowden in Moscow.

What’s the problem with that Sunday Times passage? It’s an utter lie. David did not visit Snowden in Moscow before being detained. As of the time he was detained in Heathrow, David had never been to Moscow and had never met Snowden. The only city David visited on that trip before being detained was Berlin, where he stayed in the apartment of Laura Poitras.

The Sunday Times “journalists” printed an outright fabrication in order to support their key point: that Snowden had files with him in Moscow. This is the only “fact” included in their story that suggests Snowden had files with him when he left Hong Kong, and it’s completely, demonstrably false (and just by the way: it’s 2015, not 1971, so referring to gay men in a 10-year spousal relationship with the belittling term “boyfriends” is just gross).

Then there’s the Sunday Times claim that “Snowden, a former contractor at the CIA and National Security Agency (NSA), downloaded 1.7m secret documents from western intelligence agencies in 2013.” Even the NSA admits this claim is a lie. The NSA has repeatedly said that it has no idea how many documents Snowden downloaded and has no way to find out. As the NSA itself admits, the 1.7 million number is not the number the NSA claims Snowden downloaded — they admit they don’t and can’t know that number — but merely the amount of documents he interacted with in his years of working at NSA. Here’s then-NSA chief Keith Alexander explaining exactly that in a 2014 interview with the Australian Financial Review:

AFR: Can you now quantify the number of documents [Snowden] stole?

Gen. Alexander: Well, I don’t think anybody really knows what he actually took with him, because the way he did it, we don’t have an accurate way of counting. What we do have an accurate way of counting is what he touched, what he may have downloaded, and that was more than a million documents.

Let’s repeat that: “I don’t think anybody really knows what he actually took with him, because the way he did it, we don’t have an accurate way of counting.” Yet someone whispered to the Sunday Times reporters that Snowden downloaded 1.7 million documents, so like the liars and propagandists that they are, they mindlessly printed it as fact. That’s what this whole article is.

Then there’s the claim that the Russian and Chinese governments learned the names of covert agents by cracking the Snowden file, “forcing MI6 to pull agents out of live operations in hostile countries.” This appears quite clearly to be a fabrication by the Sunday Times for purposes of sensationalism, because if you read the actual anonymous quotes they include, not even the anonymous officials claim that Russia and China hacked the entire archive, instead offering only vague assertions that Russia and China “have information.”

Beyond that, how could these hidden British officials possibly know that China and Russia learned things from the Snowden files as opposed to all the other hacking and spying those countries do? Moreover, as pointed out last night by my colleague Ryan Gallagher — who has worked for well over a year with the full Snowden archive — “I’ve reviewed the Snowden documents and I’ve never seen anything in there naming active MI6 agents.” He also said: “I’ve seen nothing in the region of 1m documents in the Snowden archive, so I don’t know where that number has come from.”

Finally, none of what’s in the Sunday Times is remotely new. US and UK government officials and their favorite journalists have tried for two years to smear Snowden with these same claims. In June, 2013, the New York Times gave anonymity to “two Western intelligence experts, who worked for major government spy agencies” who “said they believed that the Chinese government had managed to drain the contents of the four laptops that Mr. Snowden said he brought to Hong Kong.” The NYT‘s Public Editor chided the paper for printing that garbage, and as I reported in my book, then-editor-in-chief Jill Abramson told The Guardian’s Janine Gibson that they should not have printed that, calling it “irresponsible.” (And that’s to say nothing of the woefully ignorant notion that Snowden — or anyone else these days – stores massive amounts of data on “four laptops” as opposed to tiny thumb drives).

The GOP’s right-wing extremist Congressman Mike Rogers constantly did the same thing. He once announced with no evidence that “Snowden is working with Russia” — a claim even former CIA Deputy Director Michael Morell denies — and also argued that Snowden should “be charged with murder” for causing unknown deaths. My personal favorite example of this genre of reckless, desperate smears is the Op-Ed which the Wall Street Journal published in May, 2014, by neocon Edward Jay Epstein, which had this still-hilarious paragraph:

A former member of President Obama’s cabinet went even further, suggesting to me off the record in March this year that there are only three possible explanations for the Snowden heist: 1) It was a Russian espionage operation; 2) It was a Chinese espionage operation, or 3) It was a joint Sino-Russian operation.

It must be one of those, an anonymous official told me! It must be! Either Russia did it. Or China did it. Or they did it together! That is American journalism.

The Sunday Times today merely recycled the same evidence-free smears that have been used by government officials for years — not only against Snowden, but all whistleblowers — and added a dose of sensationalism and then baked it with demonstrable lies. That’s just how western journalism works, and it’s the opposite of surprising. But what is surprising, and grotesque, is how many people (including other journalists) continue to be so plagued by some combination of stupidity and gullibility, so that no matter how many times this trick is revealed, they keep falling for it. If some anonymous government officials said it, and journalists repeat it while hiding who they are, I guess it must be true. 

 

UPDATE: The Sunday Times has now quietly deleted one of the central, glaring lies in its story: that David Miranda had just met with Snowden in Moscow when he was detained at Heathrow carrying classified documents. By “quietly deleted,” I mean just that: they just removed it from their story without any indication or note to their readers that they’ve done so (though it remains in the print edition and thus requires a retraction). That’s indicative of the standard of “journalism” for the article itself. Multiple other falsehoods, and all sorts of shoddy journalistic practices, remain thus far unchanged.

(read the full article at The Intercept)

Japan delays nuclear fuel removal schedule for Fukushima plant

Reuters : June 12, 2015

Japan will delay removal of dangerous spent uranium fuel rods from the wrecked Fukushima power station, another setback in Tokyo Electric Power Co’s struggle to contain the world’s worst nuclear disaster since Chernobyl in 1986.

The Japanese government said on Friday it approved a revised “roadmap” for decommissioning the Fukushima Daiichi station, which was wrecked when an earthquake and tsunami triggered multiple meltdowns in March 2011.

The revision means delaying the start of work to remove spent nuclear fuel in cooling ponds in three reactors by as long as three years.

[…]

The delay in fuel removal from the cooling pool to 2017 or later came as the utility known as Tepco is struggling to carry out the work to reduce high radiation levels.

(read the full article at Reuters)

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