Analysis of Financial Terrorism in America

Abstract :: Welcome to World War III

Introduction

Part One :: The Economic Devastation

I :: Poverty

II :: Food Insecurity

III :: Unemployment

IV :: Declining Income

Part Two :: The Economic Elite

V :: How Much Wealth Do The Economic Elite Have?

VI :: Who Rules America? Revealing The Economic Top 0.1%

VII :: Tax Breaks For The Rich, Budget Cuts For The Rest Of Us

Part Three :: The Perfect Storm Overhead

(Inequality = Debt = Austerity = Civil Unrest = Inflation + Deflation = Stagflation)

VIII :: Debt Slavery

IX :: Inflation

X :: The Beaten Masses

Part Four :: Fascism in America

XI :: Modern Day Slavery

XII :: The Death Toll

XIII :: Deliberate Systemic Attacks

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Abstract :: Welcome to World War III

Despite increasing personal financial hardship, most Americans remain unaware of the economic world war currently unfolding. An all-pervasive corporate and government propaganda campaign has effectively obscured this blatant reality. After extensive analysis, it is evident that World War III is a war between the richest one-tenth of one percent of the global population and 99.9 percent of humanity. Or, as I have called it, The Economic Elite Vs. The People. This war has been a one-sided attack thus far. However, as we have seen throughout the world in recent months, the people are beginning to fight back. The following report is a statistical analysis of the systemic economic attacks against the American people.

Introduction

The American public has sustained intensive economic attacks across broad segments of the population. While the attacks have been increasingly severe in scale over the past four years, they have been implemented with technocratic precision. They have been incrementally applied thus far, successfully keeping the population passive and avoiding any large-scale civilian unrest, while effectively reducing living standards for the majority of the population. As you will see in this report, the 55 million Americans that have been hit the hardest have thus far acquiesced due to temporary financial assistance, such as food stamps and extended unemployment benefits.

The global Economic Elite have been much more strategic in handling the American public, as they are potentially the greatest threat to their continued consolidation of wealth, resources and power. National populations that are not as powerful, and on the periphery of the Economic Elite’s global empire, have been dealt with in much harsher fashion. In many smaller and less powerful countries the dramatic rise in food prices and costs of living have led to all-out revolt — Tunisia, Algeria, Albania and Egypt were among the first to rebel. While the contagion of rebellion has rapidly spread throughout Northern Africa and the Middle East, it is also spreading in a decentralized manner throughout most of the world, now threatening popular rebellion throughout Europe. Like the US population, the geographically clustered European nations represent a potentially powerful countervailing force to the Economic Elite’s continued domination.

Within the United States, the technocratic suppression of the population has been extensive. Increasingly severe economic and governmental policies have systematically eroded civilian wealth, power and rights. Intensive propaganda has effectively distracted, confused, isolated, marginalized and divided the US population. Despite the success of these efforts thus far, given the severe, prolonged, unsustainable and escalating level of economic suffering, outbreaks of civil unrest are inevitable. The US population, if a critical mass is reached, represents the greatest threat to the Economic Elite. In this regard, the American people are their primary adversary.

In writing this report, I will clearly demonstrate the severity and scale of the deliberate systemic economic attacks against the US population, in hope that we can urgently build a critical mass of aware and engaged citizens.

Part One :: The Economic Devastation

Snapshot: According to most recent Census Bureau data, from 2005 – 2009, average US household wealth declined by 28%. This represents a loss of $27,000 per household. Currently, at least 62 million Americans, 20% of US households, have zero or negative net worth.

The Census figures cited above are based on statistics that have been consistently proven to be lowball estimates. The government and corporate media spread propaganda on vital economic statistics that mask the severity of our economic crisis. Deceptive inflation, unemployment, poverty and GDP measures, which cast the illusion of recovery, are easily exposed with some research and a closer look at the data. Throughout this report, we will explore significant examples of government economic propaganda. In several cases, the government has been forced to revise their numbers due to proven inaccuracies. The government’s “revisions” are most always for the worse, and are usually just a footnote correction that the public is rarely ever aware of. All that being said, for many statistics we are forced to use government data, as there are not any other extensive data sets available from alternative sources.

I :: Record Breaking Poverty

The Census Bureau poverty rate is a horribly flawed measurement that uses outdated methodology. The Census measures poverty based on costs of living metrics established in 1955 – 56 years ago. They ignore many key factors, such as the increased costs of medical care, child care, education, transportation, and many other basic costs. They also don’t factor geographically-based costs of living. The National Academy of Science measure, which gets little if any corporate media coverage, gives a much more accurate account of poverty, as they factor in these vital cost of living variables.

The most current Census data revealed that 43.6 million Americans, 14.3% of the population, lived in poverty in 2009. While that is a staggering number that represents the highest number of American people to ever live in poverty, and a dramatic increase of four million people since 2008, it significantly under-counted the total. Last year, in my analysis, extrapolating data from 2008 National Academy of Science findings, I estimated that the number of Americans living in poverty in 2009 was at least 52 million. Recently, the National Academy of Science released their latest findings, backing up my claim by revealing that 52,765,000 Americans, 17.3% of the population, lived in poverty in 2009.

The poverty rate for children is even worse. According to Census data, a total of 15.5 million American children lived in poverty in 2009, which is 20% of all children. The number of children in poverty increased 28% since 2000, and jumped 10% from 2008 to 2009. Extrapolating data from the 2009 National Academy of Science poverty rate, in relation to the Census childhood poverty data, the number of American children living in poverty in 2009 is more accurately 18.8 million, which is 24%, or nearly one in four.

Other than this rapidly increasing number children who are in families that have recently fallen into poverty, “every day in America 2,573 babies are born into poverty.”

As the chart to the right shows, even with the lower Census numbers, nine major American cities have a poverty rate over 25%.

It is important to note, based on many key indicators, as you will see throughout this report, the overall poverty totals have increased since 2009. Also consider that the recent deficit reduction plan is going to cut “anti-poverty” programs that currently assist tens of millions of Americans. A study by the National Bureau of Economic Research estimates that “the poverty rate would double without these programs.” It is predicted that the new deficit deal will cut the funding for these programs in half, which, based on these estimates, would bring the total number of Americans living in poverty up to 80 million people, 26% of the population.

II :: Record Breaking Food Insecurity

For another revealing statistic, which has been quickly increasing, we can look at the number of Americans currently surviving off of food stamps. In 2005, 25.7 million Americans needed food stamps, currently 45.8 million people rely on them. As the chart to the right shows, the number of people in need of food stamps has been rapidly increasing year-over-year.

Meanwhile, Congress is cutting the funding for the food stamp program at a time when the Department of Agriculture estimates that an additional 22.5 million people will need them, bringing the total number of Americans in need of food assistance to a stunning 68.3 million people.

III :: Record Breaking Unemployment

While the “official” unemployment rate hovers around 9%, 14 million people, the government’s numbers are deceptively low once again. The only reason unemployment has stayed below 10% for the past few months is because millions of long-term unemployed, and part-time workers who are looking for full-time work, are not included in the baseline government unemployment rate. John Williams, from ShadowStats.com, has a consistently proven method of tracking unemployment that provides a much more accurate view of the overall situation. As shocking as it may sound, when you apply his SGS method, counting the total number people in need of employment, you get a current unemployment rate of 22.5%, which is an all-time record total of 34 million people currently in need of work. Here is how the SGS rate is calculated:

“The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994. That estimate is added to the BLS estimate of U-6 unemployment, which includes short-term discouraged workers.

The U-3 unemployment rate is the monthly headline number. The U-6 unemployment rate is the Bureau of Labor Statistics’ (BLS) broadest unemployment measure, including short-term discouraged and other marginally-attached workers as well as those forced to work part-time because they cannot find full-time employment.”

On top of these shocking figures, the labor force participation rate, which measures the percentage of the total population currently working, has fallen to a 27-year low of 63.9%.

Currently, an all-time record 6.3 million people have been unemployed for over six months. As the chart to the right shows, the average time it takes for a person to find a job has also just hit an all-time high of 40.4 weeks.

As companies continue to downsize and shift jobs overseas, unemployment is once again accelerating. Private-sector job cuts in July surged 60% to a 16-month high. When accounting for population growth within the total labor force, from December 2007 to present, we have lost 10.6 million jobs.

With the implementation of state and federal budget cuts, public-sector unemployment is accelerating as well. According to the Center on Budget and Policy Priorities, since August 2008, state and local governments have cut 577,000 jobs. The Economic Policy Institute estimates that cuts in the new deficit deal will lead to an additional 1.8 million job losses.

Of the new jobs that have been added in 2010, 60% of them are in low-wage fields. Since December 2007, the official unemployment rate has masked the fact that 2.8 million of the news jobs created have been part-time jobs.

Breaking down the data, over the last 12 months, the National Employment Law Project found that well-paying jobs are rapidly decreasing, while low-paying jobs are helping to mask an increasingly dire employment crisis:

· Lower-wage industries constituted 23% of job loss, but fully 49% of recent growth

· Mid-wage industries constituted 36% of job loss, and 37% of recent growth

· Higher-wage industries constituted 40% of job loss, but only 14% of recent growth

IV :: Declining Income

While the cost of living from 1990 – 2010 increased by 67%, worker income has declined. According to the most recent available IRS data, covering the year of 2009, average income fell 6.1%, a loss of $3,516 per worker, that year alone. Average income has declined 13.7% from 2007 – 2009, representing a $8,588 loss per worker.

The decline in worker income is due to the dramatic increase in CEO pay. CEO pay has consistently increased year-over-year since the mid-1970s. From 1975 – 2010, worker productivity increased 80%. Over this time frame, CEO pay and the income of the economic top 0.1% (one-tenth of one percent) of the population quadrupled. The income of the top 0.01% (one-hundredth of one percent) quintupled.

To understand the affect CEO pay increases have had on workers’ declining share of income on an annual basis, after analyzing 2008 tax data, leading tax reporter David Cay Johnston summed up the situation with these revealing statistics:

“Had income growth from 1950 to 1980 continued at the same rate for the next 28 years, the average income of the bottom 90 percent in 2008 would have been 68 percent higher…. That would have meant an average income for the vast majority of $52,051, or $21,110 more than actual 2008 incomes. How different America would be today if the typical family had $406 more each week…”

As shocking as that is, over the last two years, workers have lost an even higher share of income to CEOs. In the last year alone, CEO pay skyrocketed by 28%. Looking at 2009, according to a recent Dollars & Sense report, workers lost nearly $2 trillion in wages that year alone:

“In 2009, stock owners, bankers, brokers, hedge-fund wizards, highly paid corporate executives, corporations, and mid-ranking managers pocketed—as either income, benefits, or perks such as corporate jets—an estimated $1.91 trillion that 40 years ago would have collectively gone to non-supervisory and production workers in the form of higher wages and benefits.”

As bad as these numbers are, consider that the attack on American workers has increased significantly since 2009. From 2009 to the fourth-quarter of 2010, 88% of income growth went to corporate profits (i.e. CEOs), while just 1% went to workers.

As the NY Times reported in an article entitled, “Our Banana Republic,” from 1980 – 2005, “more than four-fifths of the total increase in American incomes went to the richest 1 percent.” Again, as bad as that was, since 2005 it has gotten even worse, as Zero Hedge recently reported, labor’s current “share of national income has fallen to its lowest level in modern history.” This chart shows how workers’ percentage of income has been rapidly declining:

The bottom line, as statistics clearly demonstrate, these trends are getting worse and the attacks against us, as severe as they have been over the past four years, are dramatically escalating.

Part Two :: The Economic Elite

– Warren Buffett, Chairman and CEO of Berkshire HathawayV :: How Much Wealth Do The Economic Elite Have?

While 68.3 million Americans struggle to get enough food to eat and wages are declining for 90% of the population, US millionaire household wealth has reached an unprecedented level. According to an extensive study by auditing and financial advisory firm Deloitte, US millionaire households now have $38.6 trillion in wealth. On top of the $38.6 trillion that this study reveals, they have an estimated $6.3 trillion hidden in offshore accounts.

In total, US millionaire households have at least $45.9 trillion in wealth, the majority of this wealth is held within the upper one-tenth of one percent of the population.

If all this isn’t obscene enough, to further demonstrate how the global economy has now been completely rigged, Deloitte’s analysis predicated, based on current trends, that US millionaire households will see a 225% increase in wealth to $87.1 trillion by 2020. Accounting for wealth hidden in offshore accounts, they are projected to have over $100 trillion in total within the next decade.

Most people cannot even comprehend how much $1 trillion is, let alone $46 trillion. One trillion is equal to 1000 billion, or $1,000,000,000,000. To put it in perspective, last year the entire cost of feeding all 40 million Americans on food stamps was $65 billion.

Now consider, according to the latest IRS data, only 0.076% of the population, less than one-tenth of one percent, earned over $1 million in 2009.

The graph below, based on data from the Tax Policy Center, shows how much income is earned by a household at any given percentile in income distribution:

The highest bracket for annual income is $50 million or more. Only 74 Americans are in this elite group. The average income within this category was $91.2 million in 2008. As astonishing as that is, in 2009 they averaged $518.8 million each, or about $10 million per week. This means, in the depths of the recession, the richest 74 Americans increased their income by more than 5 times within this one year. These 74 people made more money than 19 million workers combined.

In context, overall, the richest 400 people in the US have as much wealth as 154 million Americans combined, that’s 50% of the entire country. The top economic 1% of the US population now has a record 40% of all wealth, and have more wealth than 90% of the population combined.

VI :: Who Rules America? Revealing The Economic Top 0.1%

Here is an analysis from an investment manager with mega-wealthy clients breaking down the economic top 0.5% of the population, recently published by William Domhoff, sociology professor and author of Who Rules America?:

“Unlike those in the lower half of the top 1%, those in the top half and, particularly, top 0.1%, can often borrow for almost nothing, keep profits and production overseas, hold personal assets in tax havens, ride out down markets and economies, and influence legislation in the US. They have access to the very best in accounting firms, tax and other attorneys, numerous consultants, private wealth managers, a network of other wealthy and powerful friends, lucrative business opportunities, and many other benefits.

Folks in the top 0.1% come from many backgrounds but it’s infrequent to meet one whose wealth wasn’t acquired through direct or indirect participation in the financial and banking industries…. Most of the serious economic damage the US is struggling with today was done by the top 0.1% and they benefited greatly from it…. For example, in Q1 of 2011, America’s top corporations reported 31% profit growth and a 31% reduction in taxes, the latter due to profit outsourcing to low tax rate countries…. The year 2010 was a record year for compensation on Wall Street, while corporate CEO compensation rose by over 30%.…

In 2010 a dozen major companies, including GE, Verizon, Boeing, Wells Fargo, and Fed Ex paid US tax rates between -0.7% and -9.2%. Production, employment, profits, and taxes have all been outsourced….

I could go on and on, but the bottom line is this: A highly complex and largely discrete set of laws and exemptions from laws has been put in place by those in the uppermost reaches of the US financial system. It allows them to protect and increase their wealth and significantly affect the US political and legislative processes.

They have real power and real wealth. Ordinary citizens in the bottom 99.9% are largely not aware of these systems, do not understand how they work, are unlikely to participate in them, and have little likelihood of entering the top 0.5%, much less the top 0.1%….

… the American dream of striking it rich is merely a well-marketed fantasy that keeps the bottom 99.5% hoping for better and prevents social and political instability. The odds of getting into that top 0.5% are very slim and the door is kept firmly shut by those within it.”

To get into the top economic 0.01% (one-hundredth of one percent) of the population, you have to have a household income of over $27 million per year.

If you look at some of the central players who caused this economic crisis, you will see that they are among this Economic Elite group.

Former Goldman Sachs CEO and Bush Treasury Secretary Hank Paulson had already amassed at least $700 million prior to moving to the US Treasury in 2006. Current Goldman Sachs CEO Lloyd Blankfein and a few other top executives at Goldman Sachs just received $111.3 million in bonuses. Blankfein just took home $24.3 million, as part of a $67.9 million bonus he was awarded. Goldman’s President Gary Cohn took home $24 million, as part of a $66.9 million bonus he was awarded. Goldman’s CFO David Viniar and former co-president Jon Winkelried both took home over $20 million in bonuses.

Citigroup CEO Vikram Pandit just took home $80 million, in what may eventually total more than $200 million in compensation and bonuses. Coming in at the top of the list is JP Morgan Chase CEO Jamie Dimon, who just took home $90 million.

If you think people in this income level don’t control the US political process, you are not paying attention. After they caused this economic crisis, they got the government to give them trillions of dollars in taxpayer support, and then, after taking our tax dollars, they gave themselves all-time record-breaking bonuses. 2009 was an all-time record-breaking year for Wall Street executives bringing in a total of $145 billion. And then, in 2010, they raised the bar even higher, breaking the all-time record set the year before by pulling in another $149 billion. The audacity of it all is stunning.

Finding people more grotesquely greedy than Wall Street executives would seem to be impossible. However, health insurance CEOs are giving them a run for their money. As the LA Times reported:

“Leaders of Cigna, Humana, UnitedHealth, WellPoint and Aetna received nearly $200 million in compensation in 2009, according to a report, while the companies sought rate increases as high as 39%….

H. Edward Hanway, former chief executive of Philadelphia-based Cigna, topped the list of high-paid executives, thanks to a retirement package worth $110.9 million. Cigna paid Hanway and his successor, David Cordani, a total of $136.3 million last year….

Ron Williams, the CEO of Hartford, Conn.-based Aetna Inc., earned nearly $18.2 million in total compensation, down from $24.4 million in 2008.”

Aetna CEO Ron Williams has recovered from his down year in 2009 by making $72 million in 2010.

Given this level of obscene profiteering within the health care industry, it is not surprising that Americans pay more for medical care than any other nation in the world. In fact, Americans are forced to pay twice as much as most nations, and get lower quality care in return. As health insurance companies admitted, they have been reaping windfall profits because people with health insurance plans still cannot afford to go to the doctors and have stopped going unless it is an absolute emergency. With well over 50 million people unable to afford health insurance and the skyrocketing costs, it is not surprising that over 60% of all personal bankruptcies are the result of medical bills. In fact, 75% of the medical bankruptcies filed are from people who have health insurance.

Within this Economic Elite group, you also have the war profiteering oil companies, which themselves are in large part owned by the big Wall Street banks. The biggest five oil companies, while gas prices have been skyrocketing, reaped $36 billion in profit last quarter. These companies also receive an average of $6 billion per year in tax subsidies.

VII :: Tax Breaks For The Rich, Budget Cuts For The Rest Of Us

To further demonstrate how the mega-wealthy have seized control our political process, consider that the richest 400 Americans paid 30% of their income in taxes in 1995, but they now pay only 18%.

In fact, 1,470 Americans earned over $1 million in 2009 and didn’t pay any taxes.

The average tax rate for millionaires was 22.4% in 2009, down from 30.4% in 1995. The average millionaire saves $136,000 a year due to reduced tax rates.

Looking at the tax rate from a long-term perspective, the amount of money the richest people and most profitable corporations pay in taxes has fallen dramatically since 1955. Corporate tax accounted for 27.3% of federal revenue in 1955. In 2010, corporate tax accounted for only 8.9% of federal revenue. Corporate taxes accounted for 4.3% of overall GDP in 1955, in 2010 they accounted for only 1.3%.

Part Three :: The Perfect Storm Overhead:

(Inequality = Debt = Austerity = Civil Unrest = Inflation + Deflation = Stagflation)

The cuts in taxes for the mega-wealthy have led to record wealth inequality and resulted in a record national deficit. Meanwhile, to make up for the deficit that the richest one-tenth of one percent of the population has created, Democrats and Republicans are committed to making draconian budget cuts to vital social services, which target the poor, middle class, elderly and sick, while handing out billions more in corporate welfare annually. (Inequality = Debt = Austerity)

Just as the government has done, to make up for tax revenue lost to the mega-wealthy, Americans have made up for the decline in income by taking on large amounts of debt as well. (Inequality = Debt)

In a severely unequal society, massive debt will always be created, thus forming a vicious cycle of increasing inequality and increasing debt, until the fragmentation of society reaches a breaking point when those in debt cannot afford to pay back their debts without starving to death. We are now reaching that breaking point. (Inequality = Debt = Austerity = Civil Unrest)

VIII :: Debt Slavery

The Indentured Servant Has Become The Indebted Citizen

As for statistics on Americans being buried in financial debt, the indentured servant has evolved into the indebted citizen. As mentioned before, from 1990 – 2010 costs of living have increased 67%, while wages have stagnated and declined. As the national debt has reached a record $14.6 trillion, total personal debt is now over $16 trillion. Consumer debt is $2.5 trillion. Credit card debt is $805 billion and student debt now exceeds $1 trillion.

Obviously, the more severe your debts are, the more you have to cut back in spending and the less money you have to buy new items. (Debt = Austerity)

Meanwhile, a perfect storm circles overhead as society breaks down and falls into an economic death spiral – health care, food and gas costs are skyrocketing, while income and home values are plummeting. (Inflation + Deflation = Stagflation)

Given these conditions, it is not surprising that over 250 million Americans, another record-breaking number, are currently living paycheck-to-paycheck struggling to make ends meet.

IX :: Inflation

The following charts, from Advisor Perspectives, show the increase in costs of living since 2000:

As you can see, the price of basic necessities are consistently increasing, only clothing (apparel) has declined. The second chart highlights the crucial skyrocketing cost of energy:

The third chart highlights the pernicious skyrocketing cost of education:

The cost of education essentially buries a young person in a debt that they will spend a significant portion of their life attempting to get out of. Given the increasing costs of living, and the decreasing ability to make an expected income from such an expensive level of education, this young demographic will most likely live an entire life locked into spiraling levels of debt that they will never be able to get out of.

Propaganda Inflation

When reporting on inflation, the Bureau of Labor Statistics has twice, since 1980, revised their methodology to mask the severity of inflation, similar to how they mask the severity of unemployment. In their Consumer Price Index (CPI), which measures inflation, they have heavily discounted the measurement weight of energy, food and education – three of the most significant costs for most American households.

To understand the significance in their revised methodology, current “official” CPI is at a 3.6% annual rate. However, if calculated the way it was before former Federal Reserve Chairman Alan Greenspan altered it in 1980, it would be 11.1%, three times worse than officially stated.

So while the government and the Federal Reserve claim that inflation is low, at 3.6% over the past year, food prices have increased 39% and US gas prices have increased 34% over the same time frame.

The increase in gas cost over the past one-year masks the severity of total gas price inflation, which is currently 125% more expensive since December 2008, increasing from $1.67 per gallon to $3.75.

The Hidden Tax

The Federal Reserve’s strategic policy known as Quantitative Easing (QE) has been a significant factor in the rising cost of basic necessities by deliberately stimulating inflation, while decreasing the value of the dollar. Looking at their recent QE2 program, the dollar lost 7.5% of its value from January 2010 through March 2010. From August 2010 through March 2010, the dollar lost 17% of its value. To understand how this acts as a hidden tax, consider if you had $10,000 in the bank, over this time frame you would have lost $1700 in purchasing power. So your $10,000 would now be worth $8300. At the same time, the cost of gas and food drastically increased.

The Phantom Recovery

By decreasing the value of the dollar, the Federal Reserve is also inflating the stock market by creating the impression that stock prices are rising, which, when measured in dollars, they have. However, in real terms, their overall value has decreased. To understand how deceptive this strategy has been in giving the appearance of a rising market, instead of measuring overall stock value in dollars, let’s look at their overall value when measured in terms of gold:

Dow/Gold Chart from January 1, 2003 – August 8, 2011

As investor Michael Krieger explains:

“You can see from the chart above the downtrend of stock prices in real terms is completely intact and they have now hit a new low, below the previous low point in March 2009. In fact, although stocks did temporarily rise in real terms from the low in 2009 for the year as a whole, they were still down 5% in real terms. Then last year, stocks were 14% lower in terms of gold. Finally, despite a brief rally early in 2011, stocks in terms of gold are down 23% year-to-date.”

Dollar Vs. Gold

When comparing the value of the dollar to the value of gold, the dollar has lost a stunning 84% of its value since 2000. In 2000, gold was worth $279 per ounce, as of August 8, 2011, gold is $1,725 per ounce. In fact, the dollar continues to fall in value while gold continues to rise.

Stagflation

All these factors together create a perfect storm of stagflation. As 90% of Americans experience income declines, and the value of the dollar declines, the price of necessities are rising, while the one major asset many Americans have, a house, is also declining in value. Already, thanks to declining home values, 28% of US homeowners owe more on their mortgages than their home is currently worth. With 10.4 million American families having lost their homes to foreclosure since 2007, Amherst Securities, a leading broker/dealer focused on mortgage-related investments, estimates that another 10.8 million homes are at risk of default over the next six years. This will obviously continue downward pressure on home values.

X :: The Beaten Masses

Confronted With Severe Financial Hardship, Why Do Americans Remain Passive?

With an unprecedented sum of wealth, tens of trillions of dollars, held within the top one-tenth of one percent of the US population, we now have the highest and most severe inequality of wealth in US history. Not even the Robber Barons of the Gilded Age were as greedy as the modern day Economic Elite.

As famed American philosopher John Dewey once said, “There is no such thing as the liberty or effective power of an individual, group, or class, except in relation to the liberties, the effective powers, of other individuals, groups or classes.”

In The Economic Elite Vs. The People, I reported on the strategic withholding of wealth from 99% of the US population over the past generation. Since the mid-1970s, worker production and wealth creation has exploded. As the statistics throughout this report prove, the dramatic increase in wealth has been almost entirely absorbed by the economic top one-tenth of one percent of the population, with most of it going to the top one-hundredth of one percent.

If you are wondering why a critical mass of people desperately struggling to make ends meet are still not fighting back with overwhelming force and running the mega-wealthy aristocrats out of town, let’s consider two significant factors:

1) People are so busy trying to maintain their current standard of living that their energies are consumed by holding on to the little that they have left.

2) People have very little understanding of how much wealth has been consolidated within the top economic one-tenth of one percent.

Considering the first factor, it is obvious that people have become beaten down psychologically and financially. A report in the Guardian entitled, “Anxiety keeps the super-rich safe from middle-class rage,” suggests that people are so desperate to hold on to what they have that they are too busy looking down to look up: “As psychologists will tell you, fear of loss is more powerful than the prospect of gain. The struggling middle classes look down more anxiously than they look up, particularly in recession and sluggish recovery.”

Considering the second factor, people do not understand how much wealth has been withheld from them. The average person has never personally experienced or seen the excessive wealth and luxury that the mega-rich live in. Wealth inequality has grown so extreme and the wealthy have become so far removed from average society, it is as if the rich exist in some outer stratosphere beyond the comprehension of the average person. As the Guardian report mentioned above also states:

“… having little daily contact with the rich and little knowledge of how they lived, they simply didn’t think about inequality much, or regard the wealthy as direct competitors for resources. As the sociologist Garry Runciman observed: ‘Envy is a difficult emotion to sustain across a broad social distance.’… Even now most underestimate the rewards of bankers and executives. Top pay has reached such levels that, rather like interstellar distances, what the figures mean is hard to grasp.”

In fact, the average American vastly underestimates the severe wealth disparity that we currently have. This survey, featured in the NY Times, reveals that Americans think our society is far more equal than it actually is:

“In a recent survey of Americans, my colleague Dan Ariely and I found that Americans drastically underestimated the level of wealth inequality in the United States. While recent data indicates that the richest 20 percent of Americans own 84 percent of all wealth, people estimated that this group owned just 59 percent – believing that total wealth in this country is far more evenly divided among poorer Americans.

What’s more, when we asked them how they thought wealth should be distributed, they told us they wanted an even more equitable distribution, with the richest 20 percent owning just 32 percent of the wealth. This was true of Democrats and Republicans, rich and poor – all groups we surveyed approved of some inequality, but their ideal was far more equal than the current level.”

Here is a chart showing the results from their survey:

The fact of the matter is that the overwhelming majority of US population is unaware of the vast wealth at hand. An entire generation of unprecedented wealth creation has been concealed from 99% of the population for over 35 years. Having never personally experienced or known of this wealth, the average American cannot comprehend what is possible if even a fraction of it was used for the betterment of society as a whole.

In fact, given modern technology and wealth, not a single American citizen should live in poverty. The statistics clearly demonstrate that we now live in a Neo-Feudal society. In comparison to the wealthiest one-tenth of one percent of the population, who are sitting on top of tens of trillions of dollars in wealth, we are modern day serfs, essentially propagandized peasants.

The fact that the overwhelming majority of Americans are struggling to get by, while tens of trillions of dollars are consolidated within a small fraction of the population, is a crime against humanity.

The day the average American fully comprehends how much wealth is consolidated within just the top one-tenth of one percent of the population, there will be a massive uprising and all the paid off politicians will be run out of town.

The next time you are stressed out, struggling to make ends meet and pay off your debts, just think about the trillions of dollars sitting in the obscenely bloated pockets of one-tenth of one percent of the population. The first step in overcoming your peasant status is to understand that you are indeed a peasant. This is a bitter pill to swallow and most will prefer to, as they have been conditioned to do, continue on their path of media-induced delusion, denial, apathy and ignorance.

However, I still cling to the hope that once enough people become aware of this hidden and obscured fact, we can have the non-violent revolution we so urgently need. Until then, the rich get richer as a critical mass with increasingly dire economic prospects desperately struggles to make ends meet.

Part Four :: Fascism in America

Other than driving large segments of the American population into poverty, and pushing the majority into massive debt and a state of financial desperation, there is an ever darker side to what is unfolding today. The Economic Elite have turned America into a modern day fascist state.

Fascism is a very powerful word which evokes many strong feelings. People may think that the term cannot be applied to modern day America. However, as Benito Mussolini once summed it up: “Fascism should more properly be called corporatism, since it is the merger of state and corporate power.” In the early 1900s, the Italians who invented the term fascism also described it as “estato corporativo,” meaning: the corporate state.

Very few Americans would argue the fact that corporations now control our government and have the dominant role in our society. Through a system of legalized bribery – campaign finance, lobbying and the revolving door between Washington and corporations – the most power global corporations dominant the legislative and political process like never before. Senator Huey Long had it right when he warned: “When fascism comes to America, it will come in the form of democracy.”

As President Franklin D. Roosevelt once described fascism: “The liberty of a democracy is not safe if the people tolerate the growth of private power to a point where it comes strong than their democratic state itself. That, in its essence, is fascism — ownership of government by an individual, by a group, or any controlling private power.”

The most blatant modern example of this was the bailout of Wall Street, when the “too big to fail” banks got politicians to promptly hand out trillions of tax dollars in support and subsidies to the very people who caused the crisis, without any of them being held accountable.

XI :: Modern Day Slavery

Another shocking example of how far we have descended into fascism is the American Legislative Exchange Council (ALEC), which is a group of corporate executives who literally write government legislation. They have gone as far as setting up a system that imprisons the poor and then puts them to work, instead of paying living wages to non-imprisoned workers. Make no mistake, this is a modern day system of slavery unfolding before our eyes.

At the leadership of ALEC and various other Economic Elite organizations, poverty has essentially become a crime. To demonstrate these attacks against the poor, there was $17 billion cut from public housing programs, while there was an increase of $19 billion in programs for building prisons, “effectively making the construction of prisons the nation’s main housing program for the poor.” Before laws began to be rewritten in 1980, with direct input from ALEC, we had a prison population of 500,000 citizens. After laws were rewritten to target poor inner city citizens with much more severe penalties, the US prison population skyrocketed to 2.4 million people.

We now have the largest prison population in the world. With only 4% of the world’s population, we have 25% of the world’s prison population. As I reported previously, in a report entitled, “American Gulag: World’s Largest Prison Complex“:

“The US, by far, has more of its citizens in prison than any other nation on earth. China, with a billion citizens, doesn’t imprison as many people as the US, with only 308 million American citizens. The US per capita statistics are 700 per 100,000 citizens. In comparison, China has 110 per 100,000. In the Middle East, the repressive regime in Saudi Arabia imprisons 45 per 100,000. US per capita levels are equivalent to the darkest days of the Soviet Gulag.”

XII :: The Death Toll

The dramatic increase in poverty has obviously torn many families apart and caused a devastating psychological toll, but consider the increase in deaths as a result of poverty and severe wealth inequalities. This is a very difficult statistic to accurately measure, but Columbia University’s School of Public Health conducted an intensive examination of mortality and medical data and estimated that “875,000 deaths in the US in 2000 could be attributed to a cluster of social factors bound up with poverty and income inequality.”

As a report by Debra Watson sums up the study, “There is no reason to believe, after a decade that has seen sustained attacks on social programs and consistently high unemployment rates, that the social mortality rate has declined. On the contrary, it has likely risen.” Indeed, poverty and income inequality have skyrocketed since 2000.

Now, let’s consider the fact that, according to the Census Bureau, 31.1 million people lived in poverty in 2000, and according to Columbia’s study 875,000 deaths came as a result. This means that 1 out of every 35.5 people living in poverty die annually as a result of their impoverishment. If you extrapolate this data to the 2009 total of 52.8 million people living in poverty, you get an estimate of 1,486,338 deaths within that year. Even if you use the lower poverty totals from the Census Bureau, 43.6 million people, you get an estimate of 1,228,169 deaths in 2009.

XIII :: Deliberate Systemic Attacks

The dramatic increase in economic inequality and poverty, along with the unprecedented rise in wealth within the top one-tenth of one percent of the population has not happened by mistake. It is the designed result of deliberate governmental and economic policy. It is the result of the richest people in the world, and the “too big to fail” banks, using the campaign finance and lobbying system to buy off politicians who implement policies designed to exploit 99.9% of the population for their financial gain. To call what is happening a “financial terrorist attack” on the United States, is not using hyperbole, it is the technical term for what is currently occurring.

Compare the million people who die annually as a result of these economic attacks, to the 2,977 that died on 9/11. As someone who lived three blocks from the World Trade Center, as tragic as 9/11 was, these economic attacks are much more severe and damaging to us as a nation, albeit a much slower and unseen death toll. Nonetheless, the result is of genocidal proportions. One can statistically compare the economic attacks on the US to the invasion of Iraq, which some estimate as leading to one million deaths. Once again, many of those deaths came in brutal and spectacular fashion in bombing campaigns known as “shock and awe.” However, the death toll compares to the hidden brutality of a four-year campaign of economic “shock and awe.” Just as Iraq was invaded, the US has been invaded by a global banking cartel.

As shocking as that is to realize, consider that this is happening throughout the world. While the US poverty death rate is probably higher than in most European countries, the Federal Reserve’s economic policies — along with policies from the International Monetary Fund, World Bank and Bank of International Settlements — have caused rioting and uprisings over skyrocketing food prices and costs of living throughout the world. The fact of the matter, and very harsh and unfortunate reality of this crisis, is that the global economic central planners are deliberately carrying out genocidal economic policies.

As Che Guevara, a man who took on the global financial elite, once said, “The amount of poverty and suffering required for the emergence of a Rockefeller, and the amount of depravity that the accumulation of a fortune of such magnitude entails, are left out of the picture, and it is not always possible to make the people in general see this.”

When tens of trillions of dollars deliberately flow to the top economic one-tenth of one percent of the global population, while large percentages live in poverty, you have to conclude, in technical terms, that a Neo-Feudal-Fascist state is upon us. The rich have never been richer, while their paid off politicians make budget cuts for the poor and middle class, and cause the cost of basic necessities to skyrocket.

You can call me extreme, but the reality of this is extreme, these people, the global economic top one-tenth of one percent, are genocidal fascists carrying out a holocaust. Fascism has evolved. There is no need to get blood on your hands while rounding up people and putting them into concentration camps when you can do it through economic policy while sitting in a jacuzzi on a corporate jet, or in a three-piece custom-made Armani, completely detached and insulated from the world in which you plunder.

However, as what happens with all empires, greed and arrogance makes them overreach. The beaten down masses get to a point where they literally can’t live under these conditions. This desperation spreads throughout the population until it reaches a critical mass, then, suddenly, they rise up and the empire begins to collapse… Tunisia, Algeria, Egypt, Israel, (Northern Africa, the Middle East), Albania, Greece, Spain, Britain (Europe), Wisconsin…

The Economic Elite are overreaching and their empire is collapsing.

The decentralized global rebellion has begun…

Welcome to World War III.

Which side of history do you want to be on?

As a wise old friend once said, “You can’t be neutral on a moving train.”

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States.

The Anonymous OpESR “manifesto” presented in their first video states the following:

“We are a decentralized non-violent resistance movement, which seeks to restore the rule of law and fight back against the organized criminal class.

One-tenth of one percent of the population has consolidated wealth in unprecedented fashion and launched an all-out economic war against 99.9% of the population.

We are not affiliated with either wing of the two-party oligarchy. We seek an end to the corrupted two-party system by ending the campaign finance and lobbying racket.

Above all, we aim to break up the global banking cartel centered at the Federal Reserve, International Monetary Fund, Bank of International Settlement and World Bank.

We demand that the primary dealers within the Federal Reserve banking system be broken up and held accountable for rigging markets and destroying the global economy, effective immediately.

As a first sign of good faith, we demand Ben Bernanke step down as Federal Reserve chairman.

Until our demands are met and a rule of law is restored, we will engage in a relentless campaign of non-violent, peaceful, civil disobedience.”

In addition to this manifesto, a press release was picked up by Zero Hedge which mentioned our site and directly referenced a list of “Grievances and Demands” that also appear on our social network. The release begins:

“We, Anonymous, would like to offer you the opportunity to join and support our movement. We are a group that formed on the internet – one that knows no constructs or absolutes, and one that has recently grown exponentially…” [Read full release.]

I do not know who issued this press release. For more information on my limited interactions with unknown Anonymous sources you can watch the TV interview I had with Max Keiser discussing this.

When I originally wrote about an “Empire State Rebellion,” I was suggesting the possibility of Americans gathering in lower Manhattan’s Financial District en masse, as Egyptians did in Cairo’s Tahrir Square, to demand that the big banks be broken up. Since suggesting this idea, the report went viral, with many sites either republishing or linking to it. My various email inboxes exploded with people and groups, from across the political spectrum, saying that they wanted to make this idea into a reality. Shortly after that, an Anonymous video calling for an Operation of the same name was released, which has received over 150,000 views on our YouTube page, and an additional tens of thousands of views on other YouTube accounts and video sites as well. My interview with Max Keiser discussing the potential for a mass protest in lower Manhattan even inspired a Dubstep music remix entitled, “Empire State Rebellion: An Idea Whose Time Has Come.”

There’s also a music remix of the first OpESR video, created by an Anonymous DJ named FSS34, that is quickly becoming an anthem for the movement. The song mixes in lines from the manifesto with quotes stating:

“People need to understand that they can not get away with this…. The United States government no longer represents we the people…. We are the Paul Reveres and Patrick Henrys of our generation. You will be the intelligence Minutemen of this century. The power is in your hands…. We are about to bury rule by secrecy….”

From what I know about Anonymous, I have great respect for the concept and ideal. As I wrote in an earlier report, “Organizations such as WikiLeaks and Anonymous are playing a critical role in exposing information and protecting those who are critical of the most powerful and corrupt elements within society.” A few months ago, when our site was attacked and knocked offline, it was Anonymous members who came to our defense and helped us when no one else did. Without these unknown protectors, we couldn’t afford to continue to stave off attacks and keep our site up. For that, we have much gratitude and appreciation for them.

As I understand, Anonymous is a decentralized movement. It appears that there are many different groups acting independently that go under the name of Anonymous. I’m sure there are people that have done, and will do, things under the guise of Anonymous in an attempt to undermine and discredit the movement. The Anonymous we support and are in solidarity with have been acting as a “digital age Robin Hood,” defending people against tyrannical governments and corporations. The successful role they have played in aiding the people of Tunisia and Egypt, along with the role they played in exposing Bank of America and the Chamber of Commerce’s political smear campaigns against law-abiding journalists has proven their immense power and willingness to use it in defense of people who fight for freedom and justice.

Even though it appears as if I may have served as something of “a spark” or an inspiration for OpESR, I’m clearly just a pawn in this game. As they have demonstrated in countries throughout the world, this is a decentralized, leaderless rebellion. In a post on our social network, an Anonymous administrator wrote the following:

“A99 Operation Empire State Rebellion Exposed, Leaders Revealed

There have been many rumors surrounding A99 Operation Empire State Rebellion. Here we will reveal all you need to know.

We are a DECENTRALIZED non-violent movement. If you are looking to contact one of our leaders, go to the nearest mirror and peer deeply into it. It may take some time, but, eventually, one of our leaders will appear with answers to all of your questions.

Empire State Rebellion is an idea… an idea whose time has come!”

This is where their OpESR is a direct challenge to each of us, individually. It never ceases to amaze me how many people post online comments attempting to discredit people who are doing what they can to take action and fight back against the economic central planners who have robbed us all, yet all these commenters seem to do is just sit back bitching and waiting for other people to do what they are too passive or scared to do themselves. I wonder if these comments are coming from real people or from “fake saboteur personas,” like those Anonymous exposed in Operation Metal Gear.

There are many movements taking shape that I personally think are flawed and misguided. However, I’m not going to sit back and complain about them because they are at least organizing and taking action. As Thoreau said, “There are a thousand hacking at the branches of evil to one who is striking at the root,” but for one hacking at the branches today, there are thousands who are hiding behind their computer screen and doing nothing other than complaining, thus making themselves complicit in their own demise and pivotal players in suppressing any resistance movement at all.

The bottom line: the Anonymous OpESR went viral because they have it right and hit the nail on the head. You can’t dismiss Anonymous as a bunch of naïve young hackers when they can compose a concise 150-word statement, like the manifesto above, which correctly and directly focuses in on the systemic root of our problems. They have risen above the divide and conquer rhetoric to unite us against the “organized criminal class” that has robbed 99.9% of us. Breaking up the big banks and ending the “campaign finance and lobbying racket” is “striking at the root.”

If people cannot unite on this common ground, we will all lose. Anyone paying close attention understands this as common sense. At this point, how people who understand this can sleep at night or look themselves in the mirror without taking action and fighting back is beyond me. As Nietzsche once said, “Even the most courageous among us only rarely has the courage for that which he really knows.”

Our future has gone up in flames. For you and your family’s sake, you better find the courage and start organizing. The collapse has clearly already begun and the decentralized rebellion Anonymous is calling for is urgently needed.

In the second OpESR video, which seems to have many hidden messages throughout, there is a binary code that reveals: “OpESRsixfourteen.” There is also a graphic containing code that reveals June 14th as the launch date for whatever it is they have planned. June 14th is a significant day in American history. It was the day the Revolutionary army was formed and it is the known as Flag Day. As Wikipedia states:

“The American Continental Army was an army formed after the outbreak of the American Revolutionary War by the colonies that became the United States of America. Established by a resolution of the Continental Congress on June 14, 1775, it was created to coordinate the military efforts of the Thirteen Colonies in their revolt against the rule of Great Britain. The Continental Army was supplemented by local militias and other troops that remained under control of the individual states.”

So on this Flag Day, as we once again confront tyranny, let’s all stand up for ourselves in a decentralized manner and launch our own revolt. We’ve been talking with several organizations about turning the “Empire State Rebellion” into a reality by organizing a peaceful mass demonstration throughout New York’s Financial District – from Wall Street to the NY Federal Reserve, to the corporate offices of the six big banks and the ratings agencies. On June 14th, we will launch a massive display of non-violent force with this list of demands: End the “campaign finance and lobbying racket,” “break up the banks,” “enforce RICO laws” against the “organized criminal class,” and order “Ben Bernanke to step down.”

June 14th will also be a day when people who haven’t already moved their money out of the big banks finally withdraw their funds. The silver movement will have a “Buy Silver Day.” There will be many different actions from many different people.

The unemployed, underemployed, foreclosed on, those suffering in poverty and on food stamps will have their voice be heard. Those who have taken a pay cut, those who are struggling to make ends meet, living paycheck to paycheck, will have their voice be heard. Those impoverished by medical bills will have their voice be heard. Those drowning in student debt will have their voice be heard.

Those working on Wall Street who have watched the free market devolve into a rigged market will have their say as well. Hedge fund managers will show that they are with the people by shorting the big banks. High Frequency Traders will turn their algorithms against the banks as well.

The puppet politicians will know that they can no longer ignore us. 99.9% of the population will have their say.

Let’s honor this Flag Day by turning it into a celebration of civil disobedience – a day to declare freedom and independence, a day to show the economic central planners that their day of reckoning has come!

The time has come for YOU to take the lead. For YOU to Stand UP.

“Power concedes nothing without a demand. It never has, and it never will.”
– Frederick Douglass

Help us plan these actions and many more: http://ampedstatus.org/network/groups/a99/

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States.

The Road to Revolution

Part One :: Neo-Liberal Economic Domination

I :: Centrally Planned Economic Repression
II :: Economic Imperialism: IMF Plunder of Egypt and Tunisia
III :: US-Egypt Economic Parallels: Inequality & Poverty
IV :: Debt Slavery: Unemployed, Underemployed, Underpaid, In Debt
V :: The American Dream Foreclosed Upon
VI :: A Recipe For Revolution: Tax Breaks for the Rich, Budget Cuts for the Poor
VII :: “Hungry People Don’t Stay Hungry For Long”
VIII :: The Empire State Rebellion
IX :: The Battle in Madison: A Sign of Things to Come

Part Two :: The Most Repressive Regime: US Police State

X :: Torture: Made in the USA
XI :: American Gulag: World’s Largest Prison Complex
XII :: Loss of Civil Liberties
XIII :: Internet Crackdown
XIV :: Silencing Dissent
XV :: Protected By Anonymous

Part Three :: Bring the Tyrants Down

XVI :: The Denial of Wealth
XVII :: Economic Death Squad
XVIII :: 99.9% Vs. 0.1%
XIX :: Join the Movement

---

If you think what’s happening in Egypt won’t happen within the United States, you’ve been watching too much TV. The statistics speak for themselves.

In previous Revolution Roundups, before we were knocked offline, we featured mass protests by the people of Ireland, Italy, Britain, Austria, Greece, France and Portugal, as the Global Insurrection contagion spread throughout Europe. And now, as we have seen over the past month, North African and Middle Eastern nations have joined the movement as the people of Egypt, Tunisia, Jordan, Morocco, Gabon, Mauritania, Yemen, Bahrain, Libya, Palestine, Iraq, Sudan and Algeria have taken to the streets en masse.

The connection between this latest round of uprisings and the prior protests throughout Europe is one the mainstream media is not making. We are witnessing a decentralized global rebellion against Neo-Liberal economic imperialism. While each national uprising has its own internal characteristics, each one, at its core, is about the rising costs of living and lack of financial opportunity and security. Throughout the world the situation is the same: increasing levels of unemployment and poverty, as price inflation on food and basic necessities is soaring.

Whether national populations realize it or not, these uprisings are against systemic global economic policies that are strategically designed to exploit the working class, reduce living standards, increase personal debt and create severe inequalities of wealth. These global uprising, which have only just begun, are the first wave of the inevitable reaction to the implementation of a centralized worldwide Neo-Feudal economic order.

The global banking cartel, centered at the IMF, World Bank and Federal Reserve, have paid off politicians and dictators the world over — from Washington to Greece to Egypt. In country after country, they have looted national economies at the expense of local populations, consolidating wealth in unprecedented fashion – the top economic one-tenth of one percent is currently holding over $40 trillion in investible wealth, not counting an equally significant amount of wealth hidden in offshore accounts.

IMF imperial operations designed to extract wealth and suppress populations have been ongoing for decades. As anyone researching economic imperialism will know, a centrally planned Neo-Liberal aristocracy controls the global economy.

I: Centrally Planned Economic Repression

The IMF has a well-worn strategy that they use to conquer national economies. As I warned four months ago, we have now progressed into Step 3.5: World Wide IMF Riots. Back in October, in a TV interview with Max Keiser, we discussed leaked World Bank documents that revealed the IMF’s strategy. I stated the following:

“They have a four-step strategy for destroying national economies…. We are about to enter what they would call Step Three. Step Three is when you’ve looted the economy and now food and basic necessities all of a sudden become more expensive, harder to get to. And then, Step 3.5 is when you get the riots. We are fastly approaching that….

We are headed to, as the IMF said, and as they plan, Step 3.5: IMF Riots. That’s what’s coming…”

Fast-forward four months to today, and now we see country after country rebelling against high food prices. Since our October interview, food prices have spiked 15%. According to new World Bank data, since June 2010, “Rising food have pushed about 44 million people into poverty in developing countries.”

When QE2 was announced, I warned: “Food and Gas Prices Will Skyrocket, The Federal Reserve Just Dropped An Economic Nuclear Bomb On Us.” I also wrote: “The Federal Reserve is deliberately devaluing the dollar to enrich a small group of a global bankers, which will cause significant harm to the people of the United States and severe ramifications throughout the world…. The Federal Reserve’s actions are already causing the price of food and gas to increase and will cause hyperinflation on most basic necessities.”

To be clear, there are several significant factors contributing to rising food prices, such as extreme weather conditions, biofuel production and Wall Street speculation; but the Federal Reserve’s policies deliberately threw gasoline all over those brush fires. QE2 was another economic napalm bomb from the global banking cartel.

In a recent McClathy news article entitled, “Egypt’s unrest may have roots in food prices, US Fed policy,” Kevin Hall reports:

“‘The truth of the matter is that when the Federal Reserve moved on the quantitative easing, it did export inflation to a lot of these emerging markets…. There’s no doubt that one of the side effects of the weak dollar and quantitative easing has been rising commodity prices. It helped create this bullish environment for commodities. This is a very delicate balancing act.’

It’s a view shared by Ed Yardeni, a veteran financial market analyst, who reached a similar conclusion in a research note to investors…. He joked that Fed Chairman Ben Bernanke should be added to a list of revolutionaries, since his quantitative easing policy, unveiled last year in Wyoming, has provoked unrest and change in the developing world.

‘Since he first indicated his support for such a revolutionary monetary change… the prices of corn, soybeans and wheat have risen 53 percent, 37 percent and 24.4 percent through Friday’s close,’ Yardeni noted. ‘The price of crude oil rose 19.8 percent over this period from $75.17 to $90.09 this (Monday) morning. Soaring food and fuel prices are compounding anger attributable to widespread unemployment in the countries currently experiencing riots.’”

The people throughout the Middle East and Northern Africa, on the fringe of the Neo-Liberal economic empire and most vulnerable to the Fed’s inflationary policies, are the first to rebel.

Before analyzing the situation within the US, let’s take a closer look at the global Neo-Liberal economic policies that led to the Egyptian and Tunisian revolts.

II :: Economic Imperialism: IMF Plunder of Egypt and Tunisia

In the Middle East and North Africa populations are rising against their local dictators. However, these “dictators” take orders from the IMF.

A report from the Center for Research on Globalization revealed some background and historical context:

“The Alliance between Global Capitalism and Arab Dictators

It is paramount to understand that the Arab dictators and tyrants serve the interests of organized capital. This is their primary function. They are elements of the global system formed by organized capital.

Looking back, protests and riots started in 1977 against the regime of Mohammed Anwar Al-Sadat, Mubarak’s predecessor. The causes of these protests were the neo-liberal policies that the I.M.F. had handed down to Sadat. The I.M.F. policies ended government subsidies on basic daily commodities of life. Food prices jumped and Egyptians became hard-hit….

The Arab people grasp the fact that their ruling class and governments are not only corrupt regimes, but also comprador elites, namely the local representatives of foreign corporations, governments, and interests…. In Egypt, Gamal Mubarak (who was being groomed by his father for the presidency) worked for Bank of America.

In Tunisia, Zine Al-Abidine Ben Ali was a military officer trained in French and American military schools who, once in power, served U.S. and French economic interests. In Lebanon, Fouad Siniora was a former Citibank official before he became prime minister…. Within the corrupt Palestinian Authority, Salam Fayyad worked for one of the banks forming the U.S. Federal Reserve and the World Bank….

Moreover, almost all Arab finance ministers are affiliated to the major global banking institutions. All of them also strictly adhere to the Washington Consensus of the International Monetary Fund (I.M.F.) and the World Bank…”

Samer Shehata, professor of Arab politics at Georgetown University, summed up the situation in Egypt and Tunisia:

“Beginning in 2004… Egypt began implementing economic reforms called for by the IMF—or really forced on them by the IMF and the World Bank… a new government was appointed, new ministers were appointed, who believed wholeheartedly in the ideas of the IMF and the World Bank. And they quite vigorously pursued these policies. And there was at one level, at the level of macroeconomic indicators, statistics, GDP growth rates, foreign direct investment and so on—Egypt seemed to be a miracle. And this, of course, was the case with the Tunisian model earlier. You’ll remember that Jacques Chirac called it the ‘economic miracle,’ and it was the darling of the IMF and the World Bank, because it implemented these types of reforms earlier. Well, of course, we saw what happened in Tunisia. In Egypt, from 2004 until the present, the government and its reforms were applauded in Washington by World Bank, IMF and US officials…. Egypt received the top reformer award from the IMF and the World Bank…”

Former Goldman Sachs executive Nomi Prins reveals more details:

The Egyptian Uprising Is a Direct Response to Ruthless Global Capitalism

“The revolution in Egypt is as much a rebellion against the painful deterioration of economic conditions as it is about opposing a dictator…. When people are facing a dim future, in a country hijacked by a corrupt regime that destabilized its economy through what the CIA termed, ‘aggressively pursuing economic reforms to attract foreign investment’ (in other words, the privatization and sale of its country’s financial system to international sharks), waiting doesn’t cut it….

Tunisia’s dismal economic environment was a direct result of its increasingly ‘liberal’ policy toward foreign speculators. Of the five countries covered by the World Bank’s, Investment Across Sectors Indicator, Tunisia had the fewest limits on foreign investment…. Egypt adopted a similar come-and-get-it policy, on steroids…. But, as we learned in the U.S., what goes up with artificial helium plummets under real gravity…. Not surprisingly, those foreign speculation strategies didn’t bring less poverty or more jobs either. Indeed, the insatiable hunt for great deals, whether by banks, hedge funds, or private equity funds, as it inevitably does, had the opposite effect….

Ironically, the [Egyptian Ministry of Investment] brochure touted the large college graduate population entering the job market each year — 325,000. The same graduates are the core of the current revolution. They failed to find adequate jobs and are faced with an official unemployment rate of just below 10 percent (though, similar to the U.S., that figure doesn’t account for underemployment, poor job quality or long-term prospects)…. Meanwhile, 20 percent of Egypt lives in poverty… For in the United States, economic statistics are no better. By certain measures, like income inequality, they are worse than in Egypt.”

III :: US-Egypt Economic Parallels, Inequality & Poverty

Comparable economic statistics between the US and Egypt are facts that US mainstream media propagandists are not reporting.

Inequality of Wealth

Income inequality has reached a record level within Egypt, as Pat Garofalo explained:

“One of the driving factors behind the protests is the… growing sense of inequality. ‘They’re all protesting about growing inequalities…. The top of the pyramid was getting richer and richer,’ said Emile Hokayem of the International Institute for Strategic Studies in the Middle East.

As Yasser El-Shimy, former diplomatic attaché at the Egyptian Ministry of Foreign Affairs, wrote in Foreign Policy, ‘income inequality has reached levels not before seen in Egypt’s modern history.’”

As the US mainstream media references the “oppressive” and “corrupt” inequality of wealth throughout Egypt, the hypocrisy is shameful. The inequality of wealth in the United States is currently the most severe it has ever been. Gini coefficient ratings are a measure of a nation’s inequality – the higher a nation scores, the more unequal the society is. The US has a Gini coefficient rating of 45, compared to Egypt’s 34.4, Yemen’s 37 and Tunisia’s 40, making the US the most unequal, “oppressive” and “corrupt” of the four.

As John Dewey once said, “There is no such thing as the liberty or effective power of an individual, group, or class, except in relation to the liberties, the effective powers, of other individuals, groups or classes.”

Poverty

When well-paid “experts” in expensive suits sitting behind desks in state of the art studios discuss the hardships of the Egyptian people, something tells me that these pundits haven’t spent much time interacting with tens of millions of people living in inner city America – just because the mainstream media doesn’t cover them, doesn’t mean they don’t exist. They exist in larger numbers in the US than they do in most rebelling countries.

The rising price of food has played a pivotal role in sparking the uprisings, food prices have a larger impact in countries like Egypt and Tunisia, as they represent a more significant percentage of total income. However, the overall costs of living in the US are significantly higher. When these costs are factored in — medical expenses, housing, transportation, education, etc. – the US poverty level of $22k per year, for a family of four, is comparable to the poverty rate measure in Egypt.

According to the CIA, the poverty rate in Egypt is 20%. With a population size of 83 million people, this would put 16.6 million Egyptians living in poverty. In the US, the current poverty rate is 16.8%, with a population of 309 million, this puts 52 million Americans living below the poverty line.

When you consider that the US has 52 million people currently living in poverty, you realize, as shocking as it may sound, that we have a larger number of desperate people in the US than rebelling populations in countries throughout the Middle East and Europe. Overall, in comparison to Egypt, the US population is obviously more geographically spread out, but if you breakdown the demographics, many large US cities have a poverty rate higher than the 20 percent rate in Egypt.

Consider that, according to low-ball government statistics, nine major US cities have a poverty rate over 25%.

IV :: Debt Slavery: Unemployed, Underemployed, Underpaid, In Debt

The unemployment rate in Egypt mirrors the unemployment rate in the US, currently fluctuating between nine and ten percent, according to government sources. The unemployment rate among recent graduates attempting to enter the workforce also mirrors the crisis in the US. The young unemployed and underemployed demographic has played a pivotal role in leading the rebellion. Reporting for the Financial Times in an article entitled, “At hand, an Arab awakening,” Roula Khalaf sums it up this way:

“In Egypt, as in Tunisia, the young people who initiated the street campaigns were educated, internet-savvy activists with no political affiliation. [Sound familiar?] After watching the fervour unleashed in the past month, young Syrians, Bahrainis, Algerians and even the quiescent Libyans are turning to Facebook and Twitter to call for their own ‘day of rage’.

As Mr Khashoggi puts it: ‘The 25-year-old unemployed today has become the strong man.’”

A report from Business Week entitled, “The Youth Unemployment Bomb,” provides more detail:

“In Tunisia, the young people who helped bring down a dictator are called hittistes—French-Arabic slang for those who lean against the wall. Their counterparts in Egypt… are the shabab atileen, unemployed youths… In Britain, they are NEETs – ‘not in education, employment, or training.’ In Japan, they are freeters: an amalgam of the English word freelance and the German word Arbeiter, or worker. Spaniards call them mileuristas, meaning they earn no more than 1,000 euros a month. In the U.S., they’re ‘boomerang’ kids who move back home after college because they can’t find work. Even fast-growing China… has its ‘ant tribe’ – recent college graduates who crowd together in cheap flats on the fringes of big cities because they can’t find well-paying work.

In each of these nations, an economy that can’t generate enough jobs to absorb its young people has created a lost generation of the disaffected, unemployed, or underemployed—including growing numbers of recent college graduates for whom the post-crash economy has little to offer….

More common is the quiet desperation of a generation in ‘waithood,’ suspended short of fully employed adulthood. At 26, Sandy Brown of Brooklyn, N.Y., is a college graduate and a mother of two who hasn’t worked in seven months. ‘I used to be a manager at a Duane Reade in Manhattan, but they laid me off. I’ve looked for work everywhere and I can’t find anything,’ she says. ‘It’s like I got my diploma for nothing.’”

The collapsing job market, declining wages, loss of benefits and skyrocketing cost of education has created a “lost generation” of young college graduates with little options and massive debt. When millions of American students took out tens of thousands of dollars in student loans to pay for an education which they assumed would give them the skills needed to make a good living, they never imagined that they would be either unemployed, working part-time, or making significantly less than people in their chosen profession have traditionally made. The majority of young workers in their twenties and early thirties have debt that they will spend most of their life trying to pay back. They’ve been sentenced to a life of…

Debt Slavery

Mike Whitney recently interviewed Alan Nasser on CounterPunch for a piece entitled, “The Student Loan Swindle.” Here’s an excerpt:

“MW: Is it possible to ‘walk away’ from a student loan and declare bankruptcy?

Alan Nasser: No, it’s not possible for student debtors to escape financial devastation by declaring bankruptcy. This most fundamental of consumer protections would have been available to student debtors were it not for legislation explicitly designed to withhold a whole range of basic protections from student borrowers. I’m not talking only about bankruptcy protection, but also truth in lending requirements, statutes of limitations, refinancing rights and even state usury laws – Congress has rendered all these protections inapplicable to federally guaranteed student loans. The same legislation also gave collection agencies hitherto unimaginable powers, for example to garnish wages, tax returns, Social Security benefits and – believe it or not – Disability income.

Twisting the knife, legislators made the suspension of state-issued professional licenses, termination of public employment and denial of security clearances legitimate measures to enable collection companies to wring financial blood from bankrupt student-loan borrowers. Student loan debt is the most punishable of all forms of debt – most of those draconian measures are unavailable to credit card companies….

MW: Is it fair to say that the student loan industry is a scam that targets borrowers who will never be able to repay their debts? Are these students like the people who were seduced into taking out subprime loans? How much money is involved and how much of that money is either presently in default or headed for default?

Alan Nasser: It’s as fair as fair can be. First, the student loan industry is huge – a large majority of students from every type of school are in debt. Debt is held by 62 percent of students enrolled at public colleges and universities, 72 percent at private non-profit schools and 96 percent at private, for-profit (‘proprietary’) schools. It was announced last summer that total student loan debt, at $830 billion, now exceeds total US credit card debt, which is itself bloated to the bubble level of $827 billion. And student loan debt is growing at the rate of $90 billion a year.”

These students weren’t expecting an economic crisis to occur, and, unlike the banks that lent them the money, they’re not getting a bailout. Also factor in that the overwhelming majority of new jobs, the few that are being added, are either part-time, temporary or in low paying fields without health or retirement benefits. Mix all of this together, and you have a vicious cycle with devastating consequences.

Given the size of this segment of the population, carrying this much debt, at such a young age, with limited prospects, you can feel the winds of revolution blowing.

Contrary to all the propaganda you hear from the mainstream media and politicians, the economy is still shedding jobs at a staggering pace. ZeroHedge recently featured a report entitled, “Just How Ugly Is The Truth Of America’s Unemployment” by economist David Rosenberg:

“It is laughable that everyone believes the labor market in the U.S.A. is improving.… The data from the Household survey are truly insane. The labor force has plunged an epic 764k in the past two months. The level of unemployment has collapsed 1.2 million, which has never happened before. People not counted in the labor force soared 753k in the past two months.

These numbers are simply off the charts and likely reflect the throngs of unemployed people starting to lose their extended benefits and no longer continuing their job search (for the two-thirds of them not finding a new job). These folks either go on welfare or they rely on their spouse or other family members or friends for support….

Of all the analysis we saw over the weekend, the only one that made any sense was the editorial by Bob Herbert:

‘The policy makers don’t tell us that most of the new jobs being created in such meager numbers are, in fact, poor ones, with lousy pay and few or no benefits. What we hear is what the data zealots pump out week after week, that the market is up, retail sales are strong, Wall Street salaries and bonuses are streaking, as always, to the moon, and that businesses are sitting on mountains of cash. So all must be right with the world.

Jobs? Well, the less said the better.

What’s really happening, of course, is the same thing that’s been happening in this country for the longest time — the folks at the top are doing fabulously well and they are not interested in the least in spreading the wealth around.

The people running the country — the ones with the real clout, whether Democrats or Republicans — are all part of this power elite. Ordinary people may be struggling, but both the Obama administration and the Republican Party leadership are down on their knees, slavishly kissing the rings of the financial and corporate kingpins.’

… the civilian population rose 1.872 million last year. At the same time, the labor force fell 167k. Those not in the labor force soared 2.094 million. Just in January, we saw 319,000 people drop out of the work force. These numbers are incredible. This is a highly dysfunctional labor market. People are falling through the cracks at an alarming rate as they come off their extended jobless benefits….”

In the US, we have over six million people who have now been unemployed for over six months, the highest total we have ever had. Factoring long-term unemployed and part-time workers looking for full-time work in to the total unemployment count, we now have over 30 million Americans in need of employment.

V :: The American Dream Foreclosed Upon

The foreclosure crisis in the United States, which has already affected over seven million people since the crisis began, is not slowing down, it’s accelerating. Economist Joseph Stiglitz recently predicated another two million foreclosures in 2011. David Walsh sums up the growing crisis:

Nearly 30 percent of US homeowners now ‘underwater’

“Year over year, home values were down 5.9 percent nationally, and have fallen 27 percent since their peak in June 2006. The total value of US single-family homes fell a staggering $798 billion in 2010’s fourth quarter, and for the entire year, more than $2 trillion….

The number of US homeowners ‘underwater,’ i.e., owing more than their homes were worth, at the end of 2010, jumped to 27 percent, up from 23.2 percent in the third quarter…. ‘The rate of homes selling for a loss reached a new peak in December, with more than one-third (34.1 percent) selling for a loss. The rate of homes sold for a loss has increased steadily for the past six months.’ Some 15.7 million homeowners had negative equity at the end of the fourth quarter, in households home to more than 40 million people.

The massive number of those underwater will ‘surely lead to higher foreclosure rates soon,’ notes CNNMoney…. Economist Joseph Stiglitz, speaking at a conference in Mauritius February 9, predicted that another 2 million foreclosures would take place in the US in 2011, adding to the 7 million already recorded since the financial meltdown of 2008.

Banks repossessed 1 million homes in 2010, and this year is expected to be bleaker. Approximately 5 million borrowers are at least two months behind in their mortgage payments.”

VI :: A Recipe For Revolution: Tax Breaks for the Rich, Budget Cuts for the Poor

Let’s recap the statistics: we have 59 million people without healthcare, 52 million in poverty, 44 million on food stamps, 30 million in need of work, seven million foreclosed upon and five million homes over two months late in their mortgage payments. Meanwhile, all new political policies and proposals on the table, on the state and federal level, are committed to major cuts in social services. In a sign of what’s to come, Obama’s first disclosed spending cut targets the poor. As Salon recently reported:

New Obama strategy: Beat up poor people

“To prove it is ‘serious’ about the deficit, the White House proposes cutting a program that helps pay heating bills. The Obama administration… will propose big cuts to a program that provides energy assistance to poor people when it unveils its suggested 2012 budget. ‘The Low Income Home Energy Assistance Program, or LIHEAP… would see funding drop by about $2.5 billion from an authorized 2009 total of $5.1 billion.’

The news is generating a lot of outrage… in large part because of a paragraph that suggests that the White House wants to gain political advantage from being seen as tough on the most vulnerable Americans — people who can’t afford heating oil during cold winters…. If the White House wants to convince Americans that it is serious about budget discipline, it should do so by ‘going after powerful vested interests rather than those least able to defend themselves within the political arena.’ The White House could redouble its efforts to cut oil company subsidies or repeal tax cuts for the rich, for example.”

As The Independent reported, “Obama to set out painful budget plans for austerity in America. Americans are about to get a first glimpse of what tight-fisted federal government looks like with President Barack Obama releasing an austerity-tinged draft budget.”

In a report we featured on the AmpedStatus Hot List with the headline, “US Democracy Crushed By Economic Elite,” Bob Herbert sums it up:

“One state after another is reporting that it cannot pay its bills. Public employees across the country are walking the plank by the tens of thousands. Camden, N.J., a stricken city with a serious crime problem, laid off nearly half of its police force. Medicaid, the program that provides health benefits to the poor, is under savage assault from nearly all quarters.

The poor, who are suffering from an all-out depression, are never heard from. In terms of their clout, they might as well not exist. The Obama forces reportedly want to raise a billion dollars or more for the president’s re-election bid. Politicians in search of that kind of cash won’t be talking much about the wants and needs of the poor. They’ll be genuflecting before the very rich.”

Austerity measures and draconian cuts to the social safety net are occurring just after passing hundreds of billions of dollars in tax breaks to multi-millionaires and billionaires. On the state level, the Center on Budget and Policy Priorities released a report revealing, “Thirty-one states have released their initial budget proposals for fiscal year 2012 (which begins July 1 in most states), and, for the fourth year in a row, these budgets propose deep cuts in education, health care, and other important public services…”

After committing trillions of dollars to bailing out the big banks, the Federal Reserve and government officials have now made it clear that the states will not receive the same treatment. In fact, the bailed out players on Wall Street, who have taken our tax dollars and given themselves all-time record-breaking bonuses, are looking to cash in on the suffering of states across the country. As Lynn Parramore recently put it:

Crank Up the Casino! Hedge Funds to Short American States and Cities

“The looming possibility of municipal defaults, which some say could total hundreds of billions of dollars, is causing grave concern. Hedge funds are also deeply concerned about America’s municipal debt crisis. They worry about how to best profit from it.

The Wizards of Wall Street have looked over the catastrophe of cash-strapped America and found it good for business. In their corporate laboratories, they are working furiously to whip up wondrous new financial products that will allow them to reap millions from misery. You might think that after plunging the country into said Recession with their fancy financial products, these Wizards might feel a little indelicate about gearing up for a game of shorting a community near you. Clearly you don’t know Wall Street. The Financial Times reports that once-boring muni bonds are suddenly sexy.”

Speaking of reaping millions from misery, the food stamp racket pays off just as well as the war racket. The economic parasites profit off of food stamps:

Food Stamps: JPMorgan & Banking Industry Profit From Misery

“JPMorgan’s division that makes food stamp debit cards made $5.47 billion in net revenue in 2010. As the head of this division, Christopher Paton, says, ‘This business is a very important business to JPMorgan in terms of its size and scale.’ According to the company’s most recent quarterly filing with the SEC, the Treasury & Securities Services segment, which is the division that includes the food stamp business, was up 2% in the last three months of last quarter and brought in $5.47 billion in net revenue for most of 2010.”

Republicans and Democrats, along with their Wall Street masters, are so arrogant, deluded with wealth, completely lacking perspective, shortsighted and, quite frankly, ignorant.

As the economic top one-tenth of one percent has more wealth than they have ever had, the middle class is quickly disappearing and poverty is soaring. As politicians ignore the needs of the suffering masses in favor of a Kleptocratic Oligarchy, which operates above the law, it is only a matter of time before an uprising takes hold.

After analyzing societal and economic indicators within the US, in comparison to rebelling countries, it is not a matter of whether people will revolt or not, it’s a matter of when.

There are two significant differences between the United States and other rebelling nations:

1) The US has a much more powerful, sophisticated and omnipresent propaganda media system to keep the populace suppressed – isolated and confused.

2) The US keeps 52 million people temporarily pacified in anti-poverty programs by giving them food stamps, unemployment benefits or other forms of life-sustaining government assistance.

Both of these differences are temporary, and not in any way sustainable. The safety nets here are unraveling and cuts in vital social services will be implemented just as millions more will need them. At the same time, food stamps and other forms of limited government assistance will be worth less and less as food and gas prices continue to rise.

Rising commodity prices will push the 239 million Americans currently living paycheck to paycheck over the edge. Also factor in healthcare costs, which have been skyrocketing even faster. On a personal level, my health insurance provider just notified me that my family has to pay 45% more for coverage – and we already had the world’s most expensive healthcare system. For my wife, one child and myself, we will now have to pay over $1100 per month for a basic health insurance plan.

There are currently 59 million Americans who don’t even have healthcare insurance. The health system has become vintage Grapes of Wrath, as have most aspects of the centrally planned system of economic despotism that we live under.

Add all of these factors together and you have a recipe for revolution. The mainstream propaganda news outlets and “Reality” TV soma will only keep people at bay for so long. The propaganda system collapses when people can’t afford to eat. Americans may be late to the party, but once one city revolts, the dominos will fall and a wave of protest will sweep through the country like a tsunami.

The only questions are: when will it happen, and how it will begin?

VII :: “Hungry People Don’t Stay Hungry For Long”

Food prices have been a leading indicator for rebellion thus far. Given the Federal Reserve’s commitment to driving food prices higher, as a matter of policy, and the government’s commitment to cutting assistance programs, people lining up at Wal-Mart on the last day of the month, waiting for the clock to strike midnight so they can buy their family milk and bread on their food stamp debit card, seem to be the most likely to rebel first.

As food prices increase, food stamps are obviously going to buy you less food. On top of that, as food prices escalate, millions more will need food assistance, right at the point when the current safety net can least afford it.

Let’s analyze the most recent food stamp data to see how America’s inevitable revolution may begin.

With 43.6 million Americans currently relying on food stamps, there are 13 states with over a million people already on food stamps:

· Texas 3,925,119 (number of people on food stamps) — 15.6% (of state population)
· California 3,521,881 — 9.5%
· Florida 2,994,413 — 15.9%
· New York 2,934,493 — 15.1%
· Michigan 1,920,330 – 19.4%
· Ohio 1,772,608 — 15.4%
· Georgia 1,732,865 — 17.9%
· Illinois 1,732,169 — 13.5%
· Pennsylvania 1,673,714 — 13.2%
· North Carolina 1,531,255 — 16.1%
· Tennessee 1,264,407 — 19.9%
· Arizona 1,050,181 — 16.4%
· Washington 1,019,791 — 15.2%

States with over 18% of the population on food stamps:

· Mississippi 612,889 — 20.7%
· Tennessee 1,264,407 — 19.9%
· Oregon 749,498 — 19.6%
· Michigan 1,920,330 — 19.4%
· New Mexico 399,454 — 19.4%
· Louisiana 866,905 — 19.1%
· West Virginia 345,683 — 18.7%
· Kentucky 813,041 — 18.7%
· Maine 241,117 — 18.2%
· South Carolina 839,109 — 18.1%
· Alabama 863,606 — 18.1%

In our nation’s capital, the District of Columbia, there are 131,611 people on food stamps, which is a stunning 21.9% of the population.

As mentioned before, cities with a poverty rate over 25% – Detroit 36%, Cleveland 35%, Buffalo 29%, Milwaukee 28%, St. Louis 27%, Miami 27%, Memphis 26%, Cincinnati 26% and Philadelphia 25% – are also highly vulnerable to revolt.

VIII :: The Empire State Rebellion

Given all the data, due to New York’s geographical lay out, population size and proximity to power, it is a prime candidate for insurrection. There are currently 2.9 million people living in New York that are on food stamps, which is equivalent to the entire population of Manhattan. Just imagine three million people flooding into lower Manhattan. Imagine if three million people decided to take a 15-30 minute subway ride down to the Financial District and camped out from Wall Street to the NY Fed, spilling over to the corporate offices of JP Morgan, Goldman Sachs, Citigroup, Wells Fargo, Morgan Stanley and Bank of America.

Perhaps the one million people on food stamps from New Jersey and Connecticut will make a short trip into lower Manhattan as well, four million strong shutting down lower Manhattan, the economic capital of the world.

How would that play out in the global media?

One million people gathering in Cairo, Egypt sent shock waves throughout the world, and rightfully so, but just wait until millions of Americans begin flooding the streets. The revolution contagion will spread throughout the world like a category five hurricane.

“The civilization may still seem brilliant because it possesses an outward front,
the work of a long past, but is in reality an edifice crumbling to ruin
and destined to fall in at the first storm.”
– Gustave Le Bon, The Crowd: A Study of the Popular Mind

IX :: The Battle in Madison: A Sign of Things to Come

While bloated federal and state spending has grown to staggering levels of debt, and demands immediate attention, any cut in spending or attempts to reduce the deficit must first come at the expense of the organized criminal class that has looted the national economy. Any cuts that happen before that need to be understood as an escalation and extension of the attacks on the American people.

While continuing their attacks on American small businesses and private-sector workers, the global financial elite are now stepping up their attacks on public workers. In this context, the Wisconsin state government attacks against the state teachers’ union doesn’t have anything to do with the old Democrat Vs. Republican divide and conquer debates of the past. This is about people fighting back against their economic oppressors. In Egypt, Mubarak was the Neo-Liberal Aristocracy’s local enforcer. In Wisconsin, Scott Walker is the Neo-Liberal Aristocracy’s local enforcer.

This battle in Madison, Wisconsin, between the American people and the global financial elite, represents the opening salvo, the awakening of an American resistance movement and a sign of what’s to come.

In a report entitled, “Wisconsin governor threatens to call National Guard on state workers,” Andre Damon explains the situation:

“Scott Walker, the governor of Wisconsin, announced an assault against state…. Walker’s proposal, which he said would quickly pass in the state legislature, drastically limits collective bargaining, removing the right of unions to negotiate pensions, retirement and benefits….

When asked by a reporter what will happen if workers resist, Walker replied that he would call out the National Guard. He said that the National Guard is ‘prepared … for whatever the governor, their commander-in-chief, might call for … I am fully prepared for whatever may happen.’

Walker’s proposal allows state authorities to arbitrarily fire workers who ‘participate in an organized action to stop or slow work,’ or who ‘are absent for three days without approval of the employer,’ according to the governor’s press release.”

Democracy Now pointed out:

“… the governor’s actions could have national ramifications: ‘If Governor Walker pulls this off… if he takes down one of the strongest and most effective teachers’ unions, WEAC, in the country, then we really are going to see this sweep across the United States.’”

As a recent Washington Post report summed it up:

Workers toppled a dictator in Egypt, but might be silenced in Wisconsin

“In Egypt, workers are having a revolutionary February. In the United States, by contrast, February is shaping up as the cruelest month workers have known in decades.

The coup de grace that toppled Hosni Mubarak came after tens of thousands of Egyptian workers went on strike beginning last Tuesday. By Friday, when Egypt’s military leaders apparently decided that unrest had reached the point where Mubarak had to go, the Egyptians who operate the Suez Canal and their fellow workers in steel, textile and bottling factories; in hospitals, museums and schools; and those who drive buses and trains had left their jobs to protest their conditions of employment and governance. As Jim Hoagland noted in The Post, Egypt was barreling down the path that Poland, East Germany and the Philippines had taken, the path where workers join student protesters in the streets and jointly sweep away an authoritarian regime.

But even as workers were helping topple the regime in Cairo, one state government in particular was moving to topple workers’ organizations here in the United States…. Scott Walker, Wisconsin’s new Republican governor, proposed taking away most collective bargaining rights of public employees. Under his legislation… the unions representing teachers, sanitation workers, doctors and nurses at public hospitals, and a host of other public employees, would lose the right to bargain over health coverage, pensions and other benefits. (To make his proposal more politically palatable, the governor exempted from his hit list the unions representing firefighters and police.)….

[Those who] often profess admiration for foreign workers’ bravery in protesting and undermining authoritarian regimes. Letting workers exercise their rights at home, however, threatens to undermine some of our own regimes, and shouldn’t be permitted. Now that Wisconsin’s governor has given the Guard its marching orders, we can discern a new pattern of global repressive solidarity emerging – from the chastened pharaoh of the Middle East to the cheesehead pharaoh of the Middle West.”

Part Two :: The Most Repressive Regime: US Police State

X :: Torture: Made in the USA

It is extremely hypocritical when well-paid mainstream “news” people talk about how repressive and barbaric the Mubarak regime is in Egypt. Once again, I doubt they’ve been to inner city America recently.

If you want to report on Egypt participating in torture, it is vital to point out where they were getting their weapons, training and funding from. Who paid them to commit horrific crimes against humanity? Look in the mirror US taxpayers; you may not like what you see.

WikiLeaks revealed information on a US-Egyptian torture program:

WikiLeaks Docs: Torture-Linked Egyptian Police Trained in U.S.

“Newly released classified U.S. diplomatic cables from WikiLeaks have shed more light on the key U.S. support for human rights abuses under Mubarak’s regime in Egypt. The cables show Egyptian secret police received training at the FBI’s facility in Quantico, Virginia, even as U.S. diplomats in Egypt sent dispatches alleging extensive abuse under their watch.

Coincidentally, Quantico also hosts the military base where alleged WikiLeaks whistleblower U.S. Army Private Bradley Manning is being held in solitary confinement.

A cable from October 2009 cites allegations from ‘credible’ sources that some prisoners were tortured ‘with electric shocks and sleep deprivation to reduce them to a ‘zombie state.’ One cable from November 2007 shows then-FBI deputy director John Pistole praised the head of Egypt’s secret police for ‘excellent and strong’ cooperation between the two agencies. Pistole currently heads the Transportation Security Administration in the United States.”

America the beautiful… The Transportation Security Administration, from electric shocks, sleep deprivation and zombie states in Egypt, to cancer causing, civil liberty-destroying Naked Scanners at an airport near you.

XI :: American Gulag: World’s Largest Prison Complex

If you want to report on Egypt putting their citizens in prison, again, the hypocrisy is astonishing. The US, by far, has more of its citizens in prison than any other nation on earth. China, with a billion citizens, doesn’t imprison as many people as the US, with only 309 million American citizens. The US per capita statistics are 700 per 100,000 citizens. In comparison, China has 110 per 100,000. In the Middle East, the repressive regime in Saudi Arabia imprisons 45 per 100,000. US per capita levels are equivalent to the darkest days of the Soviet Gulag.

The majority of prisoners are locked up for non-violent crimes, with tens of thousands in Supermax cells. In addition to the heinous torture programs that the US government has carried out in Abu Ghraib, Bagram and Gitmo, we have our own solitary confinement torture programs for Americans in Supermax Units throughout the country. As Jim Ridgeway from Solitary Watch explains:

“Solitary confinement has grown dramatically in the past two decades. Today, at least 25,000 prisoners are being held in long-term lockdown in the nation’s ‘supermax’ facilities; some 50,000 to 80,000 more are held in isolation in ‘administrative segregation’ or ‘special housing’ units at other facilities. In other words, on any given day, as many as 100,000 people are living in solitary confinement in America’s prisons. This widespread practice has received scant media attention, and has yet to find a place in the public discourse or on political platforms.”

The US prison industry is thriving and expecting major growth over the next few years. A report from the Hartford Advocate titled “Incarceration Nation” revealed, “A new prison opens every week somewhere in America.” If you want to report on the brutal suppression of citizens, consider that somewhere in America, every week, a new prison is being built to literally “house the poor.”

A Boston Globe article by James Carroll shined a light on our repressive regime:

“… as federal corrections budgets increased by $19 billion, money for housing was cut by $17 billion, ‘effectively making the construction of prisons the nation’s main housing program for the poor.’ State budgets took their cues from Washington in a new but unspoken national consensus: poverty itself was criminalized. Although ‘law and order’ was taken to be a Republican mantra, this phenomenon was fully bipartisan.”

Again, just because you don’t hear this reported on TV, doesn’t mean it’s not happening.

XII :: Loss of Civil Liberties

In addition to the record-breaking imprisonment of the American population, since 9/11 our civil liberties have been violated in unprecedented fashion. Tom Burghardt, in an article entitled, “American Police State: FBI Abuses Reveals Contempt for Political Rights, Civil Liberties,” summed up a new report from the Electronic Frontier Foundation “documenting the lawless, constitutional-free zone under construction in America for nearly a decade:”

“As mass revolt spreads across Egypt and the Middle East and citizens there demand jobs, civil liberties and an end to police state abuses from repressive, U.S.-backed torture regimes, the Obama administration and their congressional allies aim to expand one right here at home.

Last week, the Electronic Frontier Foundation (EFF) released an explosive new report documenting the lawless, constitutional-free zone under construction in America for nearly a decade. That report, ‘Patterns of Misconduct: FBI Intelligence Violations from 2001-2008,’ reveals that the domestic political intelligence apparat spearheaded by the Federal Bureau of Investigation, continues to systematically violate the rights of American citizens and legal residents….

According to EFF, more than 2,500 documents obtained under the Freedom of Information Act revealed that:

* From 2001 to 2008, the FBI reported to the IOB approximately 800 violations of laws, Executive Orders, or other regulations governing intelligence investigations, although this number likely significantly under-represents the number of violations that actually occurred.

* From 2001 to 2008, the FBI investigated, at minimum, 7000 potential violations of laws, Executive Orders, or other regulations governing intelligence investigations.

* Based on the proportion of violations reported to the IOB and the FBI’s own statements regarding the number of NSL [National Security Letter] violations that occurred, the actual number of violations that may have occurred from 2001 to 2008 could approach 40,000 possible violations of law, Executive Order, or other regulations governing intelligence investigations.

But FBI lawbreaking didn’t stop there. Citing internal documents, EFF revealed that the Bureau also ‘engaged in a number of flagrant legal violations’ that included, ‘submitting false or inaccurate declarations to courts,’ ‘using improper evidence to obtain federal grand jury subpoenas’ and ‘accessing password protected documents without a warrant.’

In other words, in order to illegally spy on Americans and haul political dissidents before Star Chamber-style grand juries, the FBI routinely committed perjury and did so with absolute impunity.

Reviewing the more than 2,500 documents EFF analysts averred that they had ‘uncovered alarming trends in the Bureau’s intelligence investigation practices’ and that the ‘documents suggest the FBI’s intelligence investigations have compromised the civil liberties of American citizens far more frequently, and to a greater extent, than was previously assumed.’”

XIII :: Internet Crackdown

When the Egyptian regime shut down the Internet, they did so by using American made technology. Having been knocked offline here at AmpedStatus.com, we have firsthand experience in what it feels like to have your ability to communicate and First Amendment rights stripped away. We still don’t know who was behind the attacks on our website, but the situation in Egypt was an interesting case study. As it turned out, Obama’s new Chief of Staff, Bill Daley’s company provided the technology used to shut down the Internet in Egypt. No, I’m not referring to JP Morgan, it was the other company Bill Daley was a board member of up until last month, Boeing.

As media reform organization Free Press revealed:

“The Mubarak regime shut down Internet and cell phone communications before launching a violent crackdown against political protesters.

Free Press has discovered that an American company — Boeing-owned Narus of Sunnyvale, CA — had sold Egypt [Telecom Egypt, the state-run Internet service provider] ‘Deep Packet Inspection’ (DPI) equipment that can be used to help the regime track, target and crush political dissent over the Internet and mobile phones. Narus is selling this spying technology to other regimes with deplorable human rights records.

The power to control the Internet and the resulting harm to democracy are so disturbing that the threshold for using DPI must be very high. That’s why, before DPI becomes more widely used around the world and at home, the U.S. government must establish clear and legitimate criteria for preventing the use of such surveillance and control technology.”

It is probably just be an odd coincidence, but it was soon after we published the following report that we were knocked offline:

Obama Renews Commitment to Complete Destruction of the Middle Class – Meet the New Economic Death Squad

“…. Boeing certainly does love Wall Street. For those of you out of the loop, you may not recall that the most powerful and destructive WMD that Boeing executives ever helped develop was the CDO, that’s a Collateralized Debt (Damage) Obligation. Do you remember Edward Liddy? Liddy and Bill Daley were both Boeing board members, before Liddy temporarily moved to Goldman Sachs where he oversaw their Audit Committee. Liddy was the person who had the most knowledge of Goldman’s CDO exposure insured through, what was that company’s name?… Oh, AIG. Yeah, that was it. Then, Hank ‘Pentagon-Watergate-Goldman’ Paulson unilaterally made Liddy the CEO of AIG, before teaming up with Tim ‘Kissinger-Rubin-Summers-IMF’ Geithner to flush $183 billion tax dollars down the ‘too big to fail’ drain. And then… after the government was finished pumping our tax dollars to financial terrorists through the AIG SPV, Liddy scurried back to the board of Boeing where he could have cocktails with his ole pal Billy-Boy Daley. Yep, Goldman, JP Morgan, Boeing and the destruction of the US economy, birds of a feather…”

Within an hour of publishing that report, our site was knocked offline.

Something that has become very clear to me: when you accurately criticize the most powerful people, most people will ignore you, except the people who have the most power. They notice right away, and they let you know about it.

As I said, this is all probably just a coincidence.

However, this tangled web of interests between the Pentagon, Wall Street and the White House is fully exposed, yet again, with Obama’s special envoy to Egypt, Frank Wisner Jr.

Wisner has just as many conflicts of interest as Bill Daley and Edward Liddy. Some reports have mentioned that Wisner was biased toward supporting the Mubarak regime because he is a longtime friend of Mubarak, and worked for a law firm that represented the regime, Patton Boggs. But that’s only part of the story. Wisner, like Bill Daley, is a Council on Foreign Relations member. He is the son of legendary CIA propaganda expert Frank Wisner Sr., who created and ran Operation Mockingbird. For those of you who haven’t heard of Frank Wisner Sr., he used to report on “his ‘mighty Wurlitzer,’ on which he could play any propaganda tune.”

Frank Jr. was also a board member of Enron, up until its collapse, and like Edward Liddy, he also worked for AIG, from 1997 until 2009. Wisner oversaw two of the greatest corporate catastrophes in American history, back to back. Given his track record, Barack “mighty Wurlitzer” Obama must have thought he was the perfect guy for a collapsing corporate puppet regime in Egypt. Wisner is a disaster capitalism expert, right up there with Edward Liddy and Chief of Staff Bill Daley. Birds of a feather…

XIV :: Silencing Dissent

The recent internal emails from cyber-security firm HB Gary, released by WikiLeaks, exposing online campaigns to crackdown on critical journalists, reveals some of the other common methods used by the financial elite, like the Chamber of Commerce and Bank of America, to target and silence political adversaries.

As one of the targets of the revealed campaign, Brad Friedman reported:

US Chamber of Commerce Thugs Used ‘Terror Tools’ for Disinfo Scheme Targeting Me, My Family, Other Progressive U.S. Citizens, Groups

“The US Chamber of Commerce, the most powerful Rightwing lobbying group in the country, was revealed to have been working with their law firm and a number of private cyber security and intelligence firms to target progressive organizations, journalists and citizens who they felt were in opposition to their political activism, tactics and points of view.”

Glenn Greenwald, a journalist who was a constitutional law and civil rights litigator, was also a target of these planned attacks. In a report on the campaign to smear and discredit him, he focused on how common these illegal attacks are:

The leaked campaign to attack WikiLeaks and its supporters

“The real issue highlighted by this episode is just how lawless and unrestrained the unified axis of government and corporate power is. As creepy and odious as this is, there’s nothing unusual about these kinds of smear campaigns. The only unusual aspect here is that we happened to learn about it this time because of Anonymous’ hacking. That a similar scheme was quickly discovered by ThinkProgress demonstrates how common this behavior is. The very idea of trying to threaten the careers of journalists and activists to punish and deter their advocacy is self-evidently pernicious; that it’s being so freely and casually proposed to groups as powerful as the Bank of America, the Chamber of Commerce, and the DOJ-recommended Hunton & Williams demonstrates how common this is. “

Greenwald later added:

“Given the players involved and the facts that continue to emerge — this story is far too significant to allow to die due to lack of attention…. As the episode… demonstrates, simply relying on the voluntary statements of the corporations involved ensures that the actual facts will remain concealed if not actively distorted…. Entities of this type routinely engage in conduct like this with impunity, and the serendipity that led to their exposure in this case should be seized to impose some accountability… that these firms felt so free to propose these schemes in writing and, at least from what is known, not a single person raised any objection at all — underscores how common this behavior is.”

Dylan Ratigan recently interviewed Glenn Greenwald and they summed up the situation, here’s a brief excerpt:

DYLAN: Am I correct in understanding that substantial, legitimate, serious, powerful private security firms were pitching Bank of America and the Chamber of Commerce a campaign for which they would be paid money, in which they would assassinate the reputations and intimidate and threaten the well-being of targeted private individuals. Is that true?

GLENN: Yes, the journalists, activists, political groups, and the like.

DYLAN: Whoever it may be. And that the law firm that brought these private security firms in was recommended by the U.S. Department of Justice. So it’s on a recommendation from the DOJ that private and substantial security firms are being brought in to pitch smear and intimidation campaigns against those who support transparency in information. Fair?

GLENN: Yes, exactly….

DYLAN: … they were saying, ‘You pay me money and those who are validating the efforts of WikiLeaks or the efforts of transparency, period, in the modern information world, we will threaten their careers such that they’ll give up the cause, if you pay us.’

GLENN: Right. ‘We’ll investigate them. We’ll find out dirt on them. We will destroy their reputation using all kinds of schemes and techniques.’

DYLAN: And this came out through another leak which is the ironic twist…

GLENN: Well, one ironic twist is that it came out through a leak and the other ironic twist is that these are internet security firms that held their expertise in providing internet security and yet their e-mail system was hacked.

XV :: Protected By Anonymous

Propaganda doesn’t work as well when you have the Internet, a cyberspace Underground Railroad, a form of mass communication that allows citizens to interact without corporate gatekeepers effectively censoring critical thought. All of these attacks show the desperation of the ruling class, in attempting to maintain an obsolete propaganda system. Just look at how common and accepted unlawful practices have become in pursuit of their goals.

It is a strategic imperative that we protect Internet freedom from the forces of media concentration and censorship. Organizations such as WikiLeaks and Anonymous are playing a critical role in exposing information and protecting those who are critical of the most powerful and corrupt elements within society.

Part 3: Bring the Tyrants Down

Henry David Thoreau, On the Duty of Civil Disobedience:

“All people recognize the right of revolution; that is, the right to refuse allegiance to, and to resist, the government, when its tyranny or its inefficiency is great and unendurable. And oppression and robbery are organized, I say; let us not have such a machine any longer. I think that it is not too soon for honest people to rebel and revolutionize.”

XVI :: The Denial of Wealth

As I wrote in The Economic Elite Vs. The People:

“When you take the time to research and analyze the wealth that has gone to the economic top one percent, you begin to realize just how much we have been robbed. Trillions upon trillions of dollars that could make the lives of all hard-working Americans much easier have been strategically funneled into the coffers of the Economic Elite. The denial of wealth is the key to the Economic Elite’s power. An entire generation of massive wealth creation has been strategically withheld from 99% of the US population.”

In a new report entitled, “Nine Pictures of the Extreme Income/Wealth Gap,” Dave Johnson helps make the point:

“Many people don’t understand our country’s problem of concentration of income and wealth because they don’t see it. People just don’t understand how much wealth there is at the top now. The wealth at the top is so extreme that it is beyond most people’s ability to comprehend. If people understood just how concentrated wealth has become in our country and the effect it has on our politics, our democracy and our people, they would demand our politicians do something about it….

Top 1% owns more than 90% of us combined….

400 people have as much wealth as half of our population.”

XVII :: Economic Death Squad

A report entitled, “Grapes of Wrath – 2011,” presents a challenge to us:

“The American people have a choice…. The current path, forged by a minority of privileged wealthy elite, will lead to the destruction of this country and misery on an unprecedented scale…. Are you prepared to incur the wrath of the vested interests and meet their lies and propaganda with the fury of your own wrath in search for the truth? These men are sure you don’t have the courage, fortitude and wrath to defeat them.”

In an article and video entitled, “The Wall Street Economic Death Squad,” as I reported back in October, 2009:

“We need to focus our strategy on the small group of men who carried out the financial coup. These 13 men played leading roles in first crashing the economy, and then stealing trillions in taxpayer funds. Some of them are now calling the shots and running the government to insure that their obscene profits keep pouring into their coffers.

Know Our Enemies, EHMs – Meet The Wall Street Economic Death Squad:

Hank Paulson, Tim Geithner, Ben Bernanke, Robert Rubin, Larry Summers, Alan Greenspan, Lloyd Blankfein, Jamie Dimon, John Mack, Vikram Pandit, John Thain, Hank Greenberg, Ken Lewis.

These men ‘presided over the largest transfer of wealth in history, from the working class to the flamboyant super rich.’ What these men have done is obscene. After crashing the economy, trillions, literally trillions of dollars have been funneled into the pockets of a select few, in secrecy, while billions of people suffer in poverty, billions suffer to survive. This small tight-knit Wall Street cadre has committed a crime against humanity.”

Ralph J. Dolan, writing on Dissident Voice, declares, “Bring the Tyrants Down!”

“… while we’re observing these historic events in Egypt we might take a lesson in justice. We might come to our senses and freeze the assets of Lloyd Blankfein of Goldman Sachs, Vikram Pandit of Citigroup, Brian Moynihan of Bank of America, Jamie Dimon of J.P. Morgan Chase and John Strumpf of Wells Fargo – for starters. Then we could go after the other major players in orchestrating the financial meltdown – Timothy Geithner, Henry Paulson, Ben Bernanke, Lawrence Summers, Robert Rubin, Alan Greenspan, etc.

These guys who waltz away with billions in profits while they create misery and dislocation for many millions of struggling working people are beneath contempt….

We seem ready to kneel at the feet and kiss the hands of those who would rob us blind.

Enough! Let us bring these tyrants down!”

If Egyptians can seize the assets of a dictator like Mubarak, why can’t we seize the assets of Jamie Dimon and Llyod Blankfein?

A new report from Matt Taibbi in Rolling Stone harshly sums up Banana Republic USA:

“A former Senate investigator laughed as he polished off his beer. ‘Everything’s fucked up, and nobody goes to jail,’ he said. ‘That’s your whole story right there. Hell, you don’t even have to write the rest of it. Just write that.’ I put down my notebook. ‘Just that?’ ‘That’s right,’ he said. ‘Everything’s fucked up, and nobody goes to jail. You can end the piece right there.’

Not a single executive who ran the companies that cooked up and cashed in on the phony financial boom — an industrywide scam that involved the mass sale of mismarked, fraudulent mortgage-backed securities — has ever been convicted. Their names by now are familiar to even the most casual Middle American news consumer: companies like AIG, Goldman Sachs, Lehman Brothers, JP Morgan Chase, Bank of America and Morgan Stanley. Most of these firms were directly involved in elaborate fraud and theft.”

Once again, veteran financial journalist Paul B. Farrell hits the nail on the head. Writing for Market Watch, Farrell doesn’t pull any punches in summing up what needs to be done, and it can’t be said enough:

Fed Dictator Bernanke Needs To Be Toppled

“Fed boss Ben Bernanke is the most dangerous human on earth, far more dangerous than Hosni Mubarak, Egypt’s 30-year dictator, ever was. Bernanke rules a monetary dictatorship… But this reign of economic terror will end. Just as Mubarak was blind to the economic needs of the masses and democratic reforms, Bernanke is blind to the easy-money legacy that’s set the stage for revolution, turning the rich into super rich while the middle class stagnates and peanuts trickle down to the poor.”

You can’t sentence the overwhelming majority of the population to slow death through economic policy and expect to get away with it.

While one-tenth of one percent of the population rolls around in obscene wealth, they may want to take a look outside of their groupthink short-sighted delusional perspective and notice the outside world. You cannot ignore the suffering of the masses. They will show up at your doorstep next.

I hear footsteps…

XVIII :: 99.9% Vs. 0.1%

Egypt exposed the power that the people have. One million Egyptians proved that you can shut down a powerful regime through a mass demonstration of non-violent force. Here in the US, according to public opinion polls, 75-80% of the population believes the government doesn’t have the consent of the governed.

The mainstream media leaves Americans feeling isolated and powerless to create change, but in reality, average Americans have all the power that they need to end the economic suffering and injustices that they endure. The overwhelming majority of people feel powerless to create change, if they would just realize that they are the overwhelming majority, we would have the change we so desperately need.

As I’ve written in the past:

“To those Americans who feel powerless to change things, I say that your feelings are only a result of your induced delusion. You have become so propagandized that you do not even understand the significant position that you are in…. We are still a mass of people who have the power to change the course of history…. we are 99.9% of the US population, and they are only 0.1%.

If we fight, we win!”

The people of Tunisia and Egypt has shown us the way. People are rising up throughout the world against the exact same people who looted America. The economic central planners that have launched an economic war on Americans, are also plundering the rest of the global economy with devastating consequences for 99.9 percent of the global population.

As John Pilger points out:

The Egyptian Revolt Is Coming Home

“The uprising in Egypt is our theatre of the possible. It is what people across the world have struggled for and their thought controllers have feared…. Across the world, public awareness is rising and bypassing them. In Washington and London, the regimes are fragile and barely democratic. Having long burned down societies abroad, they are now doing something similar at home, with lies and without a mandate. To their victims, the resistance in Cairo’s Liberation Square must seem an inspiration.”

We are, as fate has it, the most power group of people on the planet. The sooner a critical mass can understand this, and the urgency of the moment, the better chance we have of solving this crisis through non-violent means. When the aware but passive realize that they too will face increasingly harsh consequences, that’s when we will have a chance to fix things. Until then, the hole gets deeper by the day.

As nations continue to fall to internal revolt, the more covert and militaristic elements of power will move to the fore. In a world of collapsing economies, limited resources and extreme weather, it appears we are on a road to worldwide war. As the people of Egypt have demonstrated, the non-violent movement has to assert itself before the situation gets so dire that outbreaks of violence will be commonplace, thus insuring a further, much harsher crackdown, police state and Neo-Feudal economic order.

As Chris Hedges makes clear:

“The longer we believe in the fiction that we are included in the corporate power structure, the more easily corporations pillage the country without the threat of rebellion….

No system of total control, including corporate control, exhibits its extreme forms at the beginning. These forms expand as they fail to encounter resistance….

All centralized power, once restraints and regulations are abolished, once it is no longer accountable to citizens, knows no limit to internal and external plunder. The corporate state, which has emasculated our government, is creating a new form of feudalism, a world of masters and serfs.”

If we do not stand and rebel now, devastating consequences are sure to drastically lower our living standards within the near future. If we rise, people across the globe will continue to rise.

“We must conclude that a changeover is imminent and ineluctable in the co-opted cast who serve the interests of domination, and above all manage the protection of that domination. In such an affair, innovation will surely not be displayed [in the mainstream media]. It appears instead like lightening, which we only know when it strikes.”
– Guy DeBord

When revolution returns to America, the point won’t be to take down a figure head puppet politician like Mubarak or Obama, mere public relations moves will not suffice. We will take down the system behind them. We will take down the global banks, break them up, end the campaign finance racket, end closed-door lobbying, end the system of political bribery, end the two-party oligarchy, remove puppet judges who voted for unlimited spending by private economic elites, end corporate welfare and the various financial rackets which loot national wealth at the expense of the people.

“All countries are basically social arrangements, accommodations to changing circumstances. No matter how permanent and even sacred they may seem at any one time,
in fact they are all artificial and temporary.”
– Strobe Talbott

We must enact common sense polices to deter organized corruption. The devil is always in the details, so rain RICO laws down upon them.

They shall reap what they sow.

Their day of reckoning is fast approaching.

Thomas Jefferson was correct when he said, “I believe that banking institutions are more dangerous to our liberties than standing armies.”

As Jefferson rightfully declared, “Every generation needs a new revolution.”

Great ready… here it comes.

As a wise man once said,

“Rise like Lions after slumber
In unvanquishable number
Shake your chains
to earth like dew
Which in sleep
had fallen on you
Ye are many
they are few”

We will not let our families continue their descent into debt slavery.

We will not leave our children to toil in a Neo-Feudal society.

We will not be on the wrong side of history.

A global uprising has begun.

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States.

If we continue to let our politicians and wealthy members of society live in comfort, free from the consequences of their actions, we are complicit in our own demise.

Our country is so overrun with corruption, we cannot remain passive and expect things to get any better.

The economy is propped up by smoke and mirrors and will inevitably collapse. Without immediately breaking up the banks and holding the thieves accountable, we will continue on our downward spiral with increasingly severe and devastating consequences.

These are extremely unpleasant truths that we are now forced to confront. We have to act now. If you are not calling for revolution or organizing, you are either unaware of what’s happening around you, horribly naïve or a fascist sympathizer.

In response to statements like those above, I’ve been exchanging emails with colleagues (journalists and news editors) who have become “uncomfortable” with my reporting style and been saying some variation of the following: “You’re being too radical. This is too extreme for us to publish.”

While I appreciate their opinions, I want to make something 100 percent clear. I am fully aware that these words are harsh, and may turn off some people. However, in extreme times, telling the truth will make you sound extreme. Ultimately, I don’t mind if you think I sound “too extreme,” I don’t care if I make people “uncomfortable,” or if, in your opinion, I’ve become “too radical.” Try telling that to the 52 million Americans who are now living in poverty. Tell that to the millions of American families who have lost their homes and jobs. Tell that to the 59 million people who can’t afford health insurance. Tell that to the overwhelming majority of the population who are stressed out, living paycheck to paycheck, buried in debt they will never get out of and desperately struggling to make ends meet.

Try telling that to all the people who have emailed me explaining their dire situations due to this economic crisis. Tell that to all the people I personally know who have taken major pay cuts.

I will not participate in the journalism of appeasement.

What has to happen for you to stop being a status quo supporting naïve journalist and realize that we are in the middle of a war? More accurately, it is a slaughter. An all-time record-breaking slaughter.

I refuse to “normalize the unthinkable.”

Here’s a list of stats that I am sure you are already extremely sick of hearing, what we have already passively accepted as “the new normal,” some new ALL-TIME RECORDS for you:

3 million families foreclosed upon;

30 million people in need of employment;

43 million people on food stamps;

52 million people in poverty;

59 million people without healthcare;

239 million living paycheck to paycheck;

$144 billion in Wall Street bonuses;

$13 Trillion in investible wealth within 1 percent of US population.

Ask yourself this question: How sick and depraved of a society do you have to live in to get an outcome like this?

We now have the highest and most severe inequality of wealth in the history of the United States. We have witnessed an economic shock and awe campaign, acts of financial terrorism have impoverished tens of millions of people and put our future prospects in an urgently dire situation. We know who is responsible for it, yet nothing is done to hold them accountable, and most astounding of all, the people responsible for this (a financial terrorism network) are still in power!

This is the largest criminal racket in world history. We need prosecutions under the Racketeer Influenced and Corrupt Organizations (RICO) Act, right now!

Another important point in response to emails that I get: when I write that Obama is a puppet, some people still get upset with me. Are you kidding me? What kind of president allows this to happen without holding people accountable? What kind of president allows our tax dollars to be taken and handed out as all-time record-breaking bonuses while we have an all-time record-breaking number of people living in poverty? What kind of president puts career-long preeminent economic imperialists Tim Geithner and Larry Summers in charge of our economy, and supports Ben Bernanke’s reconfirmation as Fed Chairman? This is all absurd and inexcusable! These three people would be in prison if we lived in a nation ruled by law. Obama is a bullshit artist – Period, Full Stop.

This is a quintessential banana republic ruled by a puppet president. If that truth is too much for you to handle, stop reading this right now and go retreat into your “reality TV” world while you still can.

Let me defer to Senator Bernie Sanders. He recently said what I’ve been screaming about and gave us one of those very rare moments when truth was actually spoken on the Senate floor:

“There is a war going on in this county and I’m not referring to the war in Iraq or the war in Afghanistan. I’m talking about a war being waged by some of the wealthiest and most powerful people in this country against the working families of the United States of America, against the disappearing and shrinking middle class of our country.

The reality is that many of the nation’s billionaires are on the war path. They want more, more, more. Their greed has no end, and apparently there is very little concern for our country or for the people of this country if it gets in the way of the accumulation of more and more wealth, and more and more power….

Today… the crooks on Wall Street… the people whose actions, illegal actions, reckless actions, have resulted in millions of Americans losing their jobs, their homes, their savings… After we bailed them out, the CEOs today are now earning more money than they did before the bailout…. While the middle class of this country collapses and the rich become much richer… the United States now has, by far, the most unequal distribution of income and wealth of any major country on earth.

When we were in school, we used to read the text books which talked about the banana republics in Latin America… about countries in which a handful of people owned and controlled most of the wealth in those countries. Well, guess what? That is exactly what is happening in the United States today.”

What will it take to make you understand this? Don’t you get it? This is a war! This is a mass slaughter carried out by economic policy. This is the elimination of the existence of a middle class. These are financial terrorists committing crimes against humanity. Our country is being attacked! My family is under attack! My child is under attack! I am under attack!

We are under attack!

I know that TV news propaganda confuses people, but on a basic and profound level, whether people want to admit it or not, the overwhelming majority of the population knows that our nation has been taken over by a global banking cartel. We know that our future has gone up in flames. We know that both political parties have been paid off and don’t represent us. If the politicians don’t drastically change course and start representing the people, we have a duty, a Constitutional commitment and obligation to launch a revolution.

If you are not calling for revolution or organizing, you are either unaware of what’s happening around you, horribly naïve or a fascist sympathizer. If we continue to let our politicians and wealthy members of society live in comfort, free from the consequences of their actions, we are complicit in our own demise.

Our country is so overrun with corruption, we cannot remain passive and expect things to get any better. The economy is now propped up by smoke and mirrors and will inevitably collapse. Without immediately breaking up the banks and holding the thieves accountable, we will continue on our downward spiral with increasingly severe and devastating consequences. These are extremely unpleasant truths that we are now forced to confront. We have to act now.

People who still delude themselves into apathy by clinging to the belief that giving trillions of dollars to the banks had to be done, are buying into a baseless propaganda line. Use your commonsense. What kind of fool would think that the best way to solve the economic crisis would be to give trillions of dollars to the people who are most responsible for causing it. That is absurd! Instead of holding them accountable for the crimes they committed, they were given trillions in taxpayer funds which they used to further consolidate power and give themselves all-time record-breaking bonuses – and they deliberately impoverished tens of millions of people in the process. People are either confused as to what happened or they are in denial and afraid to confront the colossal crime committed. Whatever the case may be, there is no escaping the consequences. The implications are staggering. If you think it’s been bad over the past two years, get ready, you haven’t seen anything yet.

So are we going to start fighting back, or should I just move my family to another country? Most everyone who understands our economic and political situation are having this debate now and contemplating moving outside the country. Is that what we should do? Should we just leave the country and let it collapse?

Those who are aware have reached the point where our survival instinct is kicking in. Fight or flight?

I’m ready to fight, but I’m not ready to fight a losing battle. We all need to do what is best for our family.

Are you with me? Or should I start packing now?

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States.

I understand the importance of the new WikiLeaks documents. However, we must not let them distract us from the new information the Federal Reserve was forced to release. Even if WikiLeaks reveals documents from inside a large American bank, as huge as that could be, it will most likely pale in comparison to what we just found out from the one-time peek we got into the inner-workings of the Federal Reserve. This is the Wall Street equivalent of the Pentagon Papers.

I’ve written many reports detailing the crimes of Wall Street during this crisis. The level of fraud, from top to bottom, has been staggering. The lack of accountability and the complete disregard for the rule of law have made me and many of my colleagues extremely cynical and jaded when it comes to new evidence to pile on top of the mountain that we have already gathered. But we must not let our cynicism cloud our vision on the details within this new information.

Just when I thought the banksters couldn’t possibly shock me anymore… they did.

We were finally granted the honor and privilege of finding out the specifics, a limited one-time Federal Reserve view, of a secret taxpayer funded “backdoor bailout” by a small group of unelected bankers. This data release reveals “emergency lending programs” that doled out $12.3 TRILLION in taxpayer money – $3.3 trillion in liquidity, $9 trillion in “other financial arrangements.”

Wait, what? Did you say $12.3 TRILLION tax dollars were thrown around in secrecy by unelected bankers… and Congress didn’t know any of the details?

Yes. The Founding Fathers are rolling over in their graves. The original copy of the Constitution spontaneously burst into flames. The ghost of Tom Paine went running, stark raving mad screaming through the halls of Congress.

The Federal Reserve was secretly throwing around our money in unprecedented fashion, and it wasn’t just to the usual suspects like Goldman Sachs, JP Morgan, Citigroup, Bank of America, etc.; it was to the entire Global Banking Cartel. To central banks throughout the world: Australia, Denmark, Japan, Mexico, Norway, South Korea, Sweden, Switzerland, England… To the Fed’s foreign primary dealers like Credit Suisse (Switzerland), Deutsche Bank (Germany), Royal Bank of Scotland (U.K.), Barclays (U.K.), BNP Paribas (France)… All their Ponzi players were “gifted.” All the Racketeer Influenced and Corrupt Organizations got their cut.

Talk about the ransacking and burning of Rome! Sayonara American middle class…

If you still had any question as to whether or not the United States is now the world’s preeminent banana republic, the final verdict was just delivered and the decision was unanimous. The ayes have it.

Any fairytale notions that we are living in a nation built on the rule of law and of the global economy being based on free market principles has now been exposed as just that, a fairytale. This moment is equivalent to everyone in Vatican City being told, by the Pope, that God is dead.

I’ve been arguing for years that the market is rigged and that the major Wall Street firms are elaborate Ponzi schemes, as have many other people who built their beliefs on rational thought, reasoned logic and evidence. We already came to this conclusion by doing the research and connecting the dots. But now, even our strongest skeptics and the most ardent Wall Street supporters have it all laid out in front of them, on FEDERAL RESERVE SPREADSHEETS.

Even the Financial Times, which named Lloyd Blankfein its 2009 person of the year, reacted by reporting this: “The initial reactions were shock at the breadth of lending, particularly to foreign firms. But the details paint a bleaker and even more disturbing picture.”

Yes, the emperor doesn’t have any clothes. God is, indeed, dead. But, for the moment at least, the illusion continues to hold power. How is this possible?

To start with, as always, the US television “news” media (propaganda) networks just glossed over the whole thing – nothing to see here, just move along, back after a message from our sponsors… Other than that obvious reason, I’ve come to the realization that the Federal Reserve’s crimes are so big, so huge in scale, it is very hard for people to even wrap their head around it and comprehend what has happened here.

Think about it. In just this one peek we got at its operations, we learned that the Fed doled out $12.3 trillion in near-zero interest loans, without Congressional input.

The audacity and absurdity of it all is mind boggling…

Based on many conversations I’ve had with people, it seems that the average person doesn’t comprehend how much a trillion dollars is, let alone 12.3 trillion. You might as well just say 12.3 gazillion, because people don’t grasp a number that large, nor do they understand what would be possible if that money was used in other ways.

Can you imagine what we could do to restructure society with $12.3 trillion? Think about that…

People also can’t grasp the colossal crime committed because they keep hearing the word “loans.” People think of the loans they get. You borrow money, you pay it back with interest, no big deal.

That’s not what happened here. The Fed doled out $12.3 trillion in near-zero interest loans, using the American people as collateral, demanding nothing in return, other than a bunch of toxic assets in some cases. They only gave this money to a select group of insiders, at a time when very few had any money because all these same insiders and speculators crashed the system.

Do you get that? The very people most responsible for crashing the system, were then rewarded with trillions of our dollars. This gave that select group of insiders unlimited power to seize control of assets and have unprecedented leverage over almost everything within their economies – crony capitalism on steroids.

This was a hostile world takeover orchestrated through economic attacks by a very small group of unelected global bankers. They paralyzed the system, then were given the power to recreate it according to their own desires. No free market, no democracy of any kind. All done in secrecy. In the process, they gave themselves all-time record-breaking bonuses and impoverished tens of millions of people – they have put into motion a system that will inevitably collapse again and utterly destroy the very existence of what is left of an economic middle class.

That is not hyperbole. That is what happened.

We are talking about trillions of dollars secretly pumped into global banks, handpicked by a small select group of bankers themselves. All for the benefit of those bankers, and at the expense of everyone else. People can’t even comprehend what that means and the severe consequences that it entails, which we have only just begun to experience.

Let me sum it up for you: The American Dream is O-V-E-R.

Welcome to the neo-feudal-fascist state.

People throughout the world who keep using the dollar are either A) Part of the scam; B) Oblivious to reality; C) Believe that US military power will be able to maintain the value of an otherwise worthless currency; D) All of the above.

No matter which way you look at it, we are all in serious trouble!

If you are an elected official, (I know at least 17 of you subscribe to my newsletter) and you believe in the oath you took upon taking office, you must immediately demand a full audit of the Federal Reserve and have Ben Bernanke and the entire Federal Reserve Board detained. If you are not going to do that, you deserve to have the words “Irrelevant Puppet” tattooed across your forehead.

Yes, those are obviously strong words, but they are the truth.

The Global Banking Cartel has now been so blatantly exposed, you cannot possibly get away with pretending that we live in a nation of law based on the Constitution. The jig is up.

It’s been over two years now; does anyone still seriously not understand why we are in this crisis? Our economy has been looted and burnt to the ground due to the strategic, deliberate decisions made by a small group of unelected global bankers at the Federal Reserve. Do people really not get the connection here? I mean, H.E.L.L.O. Our country is run by an unelected Global Banking Cartel.

I am constantly haunted by a quote from Harry Overstreet, who wrote the following in his 1925 groundbreaking study Influencing Human Behavior: “Giving people the facts as a strategy of influence” has been a failure, “an enterprise fraught with a surprising amount of disappointment.”

This crisis overwhelmingly proves Overstreet’s thesis to be true. Nonetheless, we solider on…

Here’s a roundup of reports on this BernankeLeaks:

Prepare to enter the theater of the absurd…

I’ll start with Senator Bernie Sanders (I-Vermont). He was the senator who Bernanke blew off when he was asked for information on this heist during a congressional hearing. Sanders fought to get the amendment written into the financial “reform” bill that gave us this one-time peek into the Fed’s secret operations. (Remember, remember the 6th of May, HFT, flash crash and terrorism. “Hey, David, Homeland Security is on the phone! They want to ask you questions about some NYSE SLP program.”)

In an article entitled, “A Real Jaw-Dropper at the Federal Reserve,” Senator Sanders reveals some of the details:

At a Senate Budget Committee hearing in 2009, I asked Fed Chairman Ben Bernanke to tell the American people the names of the financial institutions that received an unprecedented backdoor bailout from the Federal Reserve, how much they received, and the exact terms of this assistance. He refused. A year and a half later… we have begun to lift the veil of secrecy at the Fed…

After years of stonewalling by the Fed, the American people are finally learning the incredible and jaw-dropping details of the Fed’s multi-trillion-dollar bailout of Wall Street and corporate America….

We have learned that the $700 billion Wall Street bailout… turned out to be pocket change compared to the trillions and trillions of dollars in near-zero interest loans and other financial arrangements the Federal Reserve doled out to every major financial institution in this country.…

Perhaps most surprising is the huge sum that went to bail out foreign private banks and corporations including two European megabanks — Deutsche Bank and Credit Suisse — which were the largest beneficiaries of the Fed’s purchase of mortgage-backed securities….

Has the Federal Reserve of the United States become the central bank of the world?… [read Global Banking Cartel]

What this disclosure tells us, among many other things, is that despite this huge taxpayer bailout, the Fed did not make the appropriate demands on these institutions necessary to rebuild our economy and protect the needs of ordinary Americans….

What we are seeing is the incredible power of a small number of people who have incredible conflicts of interest getting incredible help from the taxpayers of this country while ignoring the needs of the people. [read more]

In an article entitled, “The Fed Lied About Wall Street,” Zach Carter sums it up this way:

The Federal Reserve audit is full of frightening revelations about U.S. economic policy and those who implement it… By denying the solvency crisis, major bank executives who had run their companies into the ground were allowed to keep their jobs, and shareholders who had placed bad bets on their firms were allowed to collect government largesse, as bloated bonuses began paying out soon after.

But the banks themselves still faced a capital shortage, and were only kept above those critical capital thresholds because federal regulators were willing to look the other way, letting banks account for obvious losses as if they were profitable assets.

So based on the Fed audit data, it’s hard to conclude that Fed Chairman Ben Bernanke was telling the truth when he told Congress on March 3, 2009, that there were no zombie banks in the United States.

“I don’t think that any major U.S. bank is currently a zombie institution,” Bernanke said.

As Bernanke spoke those words banks had been pledging junk bonds as collateral under Fed facilities for several months…

This is the heart of today’s foreclosure fraud crisis. Banks are foreclosing on untold numbers of families who have never missed a payment, because rushing to foreclosure generates lucrative fees for the banks, whatever the costs to families and investors. This is, in fact, far worse than what Paul Krugman predicted. Not only are zombie banks failing to support the economy, they are actively sabotaging it with fraud in order to make up for their capital shortages. Meanwhile, regulators are aggressively looking the other way.

The Fed had to fix liquidity in 2008. That was its job. But as major banks went insolvent, the Fed and Treasury had a responsibility to fix that solvency issue—even though that meant requiring shareholders and executives to live up to losses. Instead, as the Fed audit tells us, policymakers knowingly ignored the real problem, pushing losses onto the American middle class in the process.” [read more]

Even the Financial Times is jumping ship:

Sunlight Shows Cracks in Fed’s Rescue Story

It took two years, a hard-fought lawsuit, and an act of Congress, but finally… the Federal Reserve disclosed the details of its financial crisis lending programs. The initial reactions were shock at the breadth of lending, particularly to foreign firms. But the details paint a bleaker, earlier, and even more disturbing picture…. An even more troubling conclusion from the data is that… it is now apparent that the Fed took on far more risk, on less favorable terms, than most people have realized. [read more]

In true Fed fashion, they didn’t even fully comply with Congress. In a report entitled, “Fed Withholds Collateral Data for $885 Billion in Financial-Crisis Loans,” Bloomberg puts some icing on the cake:

For three of the Fed’s six emergency facilities, the central bank released information on groups of collateral it accepted by asset type and rating, without specifying individual securities. Among them was the Primary Dealer Credit Facility, created in March 2008 to provide loans to brokers as Bear Stearns Cos. collapsed.

“This is a half-step,” said former Atlanta Fed research director Robert Eisenbeis, chief monetary economist at Cumberland Advisors Inc. in Sarasota, Florida. “If you were going to audit the facilities, then would this enable you to do an audit? The answer is ‘No,’ you would have to go in and look at the individual amounts of collateral and how it was broken down to do that. And that is the spirit of what the requirements were in Dodd-Frank.” [read more]

See also:

Here’s the only person on US TV “news” who actually covers and understands any of this, enter Dylan Ratigan, with his guest Chris Whalen from Institutional Risk Analytics. This quote from Whalen sums it up well: “The folks at the Fed have become so corrupt, so captured by the banking industry… the Fed is there to support the speculators and they let the real economy go to hell.”

The Progressive’s Matthew Rothschild has a good quote: “The financial bailout was a giant boondoggle, undemocratic and kleptocratic to its core.”

Matt Stoller on NewDeal 2.0:

End This Fed

The Fed, and specifically the people who run it, are responsible for declining wages, for de-industrialization, for bubbles, and for the systemic corruption of American capital markets. The new financial blogosphere destroyed the Fed’s mythic stature…. With a loss of legitimacy comes a lack of public trust and a vulnerability to any form of critic. The Fed is now less respected than the IRS…. Liberals should stop their love affair with conservative technocratic myths of monetary independence, and cease seeing this Federal Reserve as a legitimate actor. At the very least, we need to begin noticing that these people do in fact run the country, and should not. [read more]

In case anyone is confused into believing that this is just another right vs. left partisan issue, enter Fox Business host Judge Andrew Napolitano with his guest Republican Congressman Ron Paul, who is, of course, a longtime leading Fed critic. Paul hopes to see some Wikileaks on the Federal Reserve:

The Sunlight Foundation shines a light on Bank of America and the Federal Reserve’s brother money manager BlackRock:

Federal Reserve Loan Program Allowed Bank of America to Benefit Twice

Bank of America was one of several banks that was able to play both sides of a Federal Reserve program launched during the 2008 financial crisis. While Bank of America was selling its assets to firms obtaining loans through the Fed program, the investment firm BlackRock—partially owned by Bank of America—was potentially turning a profit by using those loans to buy assets similar to those sold by Bank of America. [read more]

Gretchen Morgenson at the New York Times jumps into the act:

So That’s Where the Money Went

How the truth shines through when you shed a little light on a subject….

All of the emergency lending data released by the Fed are highly revealing, but why weren’t they made public much earlier? That’s a question that Walker F. Todd, a research fellow at the American Institute for Economic Research, is asking.

Mr. Todd, a former assistant general counsel and research officer at the Federal Reserve Bank of Cleveland, said details about the Fed’s vast and various programs should have been available before the Dodd-Frank regulatory reform law was even written.

“The Fed’s current set of powers and the shape of the Dodd-Frank bill over all might have looked quite different if this information had been made public during the debate on the bill,” he said. “Had these tables been out there, I think Congress would have either said no to emergency lending authority or if you get it, it’s going to be a much lower number — half a trillion dollars in the aggregate.” [read more]

Welcome to the “global pawnshop:”

The Fed Operates as a “global pawnshop:” $9 trillion to 18 financial institutions

What the report shows is that the Fed operated as a global pawnshop taking in practically anything the banks had for collateral. What is even more disturbing is that the Federal Reserve did not enact any punitive charges to these borrowers so you had banks like Goldman Sachs utilizing the crisis to siphon off cheap collateral. The Fed is quick to point out that “taxpayers were fully protected” but mention little of the destruction they have caused to the US dollar. This is a hidden cost to Americans and it also didn’t help that they were the fuel that set off the biggest global housing bubble ever witnessed by humanity. [read more]

“No strings attached.” Financial reporter Barry Grey unleashes the truth:

Fed report lifts lid on Great Bank Heist of 2008-2009

The banks and corporations that benefited were not even obliged to provide an account of what they did with the money. The entire purpose of the operation was to use public funds to cover the gambling losses of the American financial aristocracy, and create the conditions for the financiers and speculators to make even more money.

All of the 21,000 transactions cited in the Fed documents―released under a provision included, over the Fed’s objections, in this year’s financial regulatory overhaul bill―were carried out in secret. The unelected central bank operated without any congressional mandate or oversight.

The documents shed light on the greatest plundering of social resources in history. It was carried out under both the Republican Bush and Democratic Obama administrations. Those who organized the looting of the public treasury were long-time Wall Street insiders: men like Bush’s treasury secretary and former Goldman Sachs CEO Henry Paulson and the then-president of the New York Federal Reserve, Timothy Geithner….

The Fed documents show that the US central bank enabled banks and corporations to offload their bad debts onto the Fed’s balance sheet. Now, in order to prevent a collapse of the dollar and a default by the US government, the American people are being told they must sacrifice to reduce the national debt and budget deficit.

But as the vast sums make clear, the “sacrifice” being demanded of working people means their impoverishment―wage-cutting, mass unemployment, cuts in health care, Social Security, Medicare, Medicaid, etc.

The very scale of the Fed bailout points to the scale of the financial crash and the criminality that fostered it…. The entire US capitalist economy rested on a huge Ponzi scheme that was bound to collapse…

The banks were able to take the cheap cash from the Fed and lend it back to the government at double and quadruple the interest rates they were initially charged―pocketing many billions in the process….

The ongoing saga of the looting of the economy by the financial elite puts the lie to the endless claims that “there is no money” for jobs, housing, education or health care. The ruling class is awash in money. [read more]

Here’s an old Jim Rogers interview from two years ago when this whole thing was originally going down:

Here are two videos that I made last year, with an assist from Alan Grayson and Dylan Ratigan:

The Wall Street Economic Death Squad – Part I

The Greatest Theft in History – Wall Street Economic Death Squad – Part II

And on a final note, you may as well rock out to this new song while Rome burns…

WORLD PREMIERE ~ Ben Bernanke: Public Enemy #1 – Mr. Big Shot (((Music Video)))

Ben Shalom Bernanke is wanted for violating the United States Constitution, committing acts of financial terrorism and crimes against humanity. As a leading member of the Global Banking Cartel, he is considered a highly dangerous enemy combatant. Citizens of the United States hereby demand that he be properly detained under the laws and customs of war.

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States. To be notified via email about further articles from this series, subscribe here.

Now that comedians like Glenn Beck, Jon Stewart and Stephen Colbert have demonstrated the ability to rally thousands of Americans, don’t you think it’s time to have a serious rally to restore the rule of law and the Constitution?

How much longer are we going to remain passive while global banking interests rob us of our national wealth and destroy the fabric of our society. Our nation has become a banana republic where the rule of law has become a farce and clearly doesn’t apply to one-tenth of one percent of the population. Anyone who has been paying attention realizes that an organized criminal operation has taken over the United States.

The collapse of the housing market was the result of organized criminal activity, from top to bottom. The people who committed the largest financial crime in the history of the United States were rewarded with trillions of dollars in national wealth, and continue to be rewarded as this criminal activity continues unabated.

In an attempt to drive the final nail into our coffin, five members of the Supreme Court have blatantly proven that they are beholden to these interests by ruling in favor of unlimited spending on political campaigns, which allows for a grotesque abuse of power and firmly entrenches the banking interests that have seized our nation. These banking interests have paid-off, or legally [sic] bribed, the majority of our elected officials and leaders of both parties, leaving 99% of the American population without representation.

The longer we allow them to get away with it, the more emboldened the global banking cartel is becoming. Let’s look at their latest scam…

Quantitative Fleecing: The Backdoor Bailout & Hidden Tax

On top of the many crimes already committed, their latest swindle is the Federal Reserve’s Quantitative Easing (QE2) program. QE2 is a money printing scheme that is in direct violation of the Constitution. The Constitution explicitly gives fiscal authority to Congress. The Federal Reserve, as a group of unelected global banking interests, cannot enact this policy without the direct approval of Congress. Therefore, Congress must take immediate action to stop this illegal activity, yet they remain completely silent on this usurpation of power.

As Hussman Funds president John Hussman politely put it:

“Given that fiscal authority is enumerated by the Constitution as the sole right of Congress, and spending is prohibited by the Constitution without explicit appropriation, it seems clear – regardless of how the Federal Reserve Act is written – that monetary operations involving anything but Treasury securities contain unconstitutional ‘fiscal component,’ unless they involve repurchase agreements that would make the Fed whole even if the underlying securities were to fail. It is doubtful that when Congress drafted the Federal Reserve Act to allow the use of mortgage-backed securities, it ever dreamed that the Fed would purchase these securities outright when the issuer was insolvent. Until this issue is clarified in legislation, Bernanke will continue to see it as ‘perfectly sensible’ for the Fed to make ‘money financed gifts’ that substitute his own personal discretion for those of a democracy.

Equally disturbing is that Bernanke apparently has no problem confusing fiscal policy with monetary policy when it suits him.”

The Federal Reserve tells us that they are doing this QE2 program to stimulate the economy and create jobs. Any serious economist will tell you that this is a blatant lie. We know from a basic understanding of economics and the results of QE1 that this program is completely ineffective in accomplishing their stated goals. The Federal Reserve is deliberately devaluing the dollar to enrich a small group of a global bankers, which will cause significant harm to the people of the United States and severe ramifications throughout the world. Their actions are igniting a global currency and trade war that is endangering the security of the United States. The Department of Homeland Security should take immediate actions to protect us against these acts of financial terrorism, and that’s not a joke.

The Federal Reserve’s actions are already causing the price of food and gas to increase and will cause hyperinflation on most basic necessities. This is happening at a time when we have a record 52 million Americans living in poverty, 42.4 million on food stamps and 77 percent of the population now living paycheck to paycheck. By deliberately devaluing the dollar and causing the price of necessities to rise, the Federal Reserve is, as a matter of strategic policy, sacrificing a significant percentage of the US population for the benefit of a few bankers – bankers who have already been experiencing all-time record high bonuses over the past two years. This is why we now have the highest and most severe inequality of wealth in US history. Not even the robber barons looted the economy as effectively as these banksters have.

Bill Gross, the head of the world’s largest mutual fund PIMCO, has said he expects the Fed’s QE2 program to cause a 20% decline in the value of the dollar. That may sound like an exaggeration to you, but many analysts are predicating an even more severe decline in value, and given the current global economic environment, with currency wars escalating, the very existence of the dollar is threatened like never before.

The bottom line is that this QE2 program amounts to a 20% tax increase for all Americans. They are not only taking an additional 20% of our annual salary, they are also taking 20% of all the money that we have in the bank. This is a backdoor bailout, a hidden tax, a way for working Americans to pay for the crimes of Wall Street. A way to cover the fraudulent toxic debt that they created in their casino Ponzi scheme that destroyed the economy in the first place.

This is the essence of taxation without representation.

We let them get away with the corrupted bailout. We let them get away QE1, which already stole 10% of our money last year. So now they are back at it, getting even bolder in their disregard for the American people and the Constitution.

The Federal Reserve represents global banking interests who have overstepped their legal authority and explicitly violated the Constitution. In clear terms, their actions represent a declaration of war against the people of the United States. The Federal Reserve Bank and their primary dealers are officially enemies of the state.

Make no mistake, Ben Bernanke is Public Enemy #1.

He represents the interests of the people who have brought overwhelming poverty and economic hardship to our doorstep. When are we going to hold him accountable for his actions?

All elected officials, civil servants and US military service members have swore an oath to uphold and protect the Constitution against all enemies, foreign and domestic. If Congress does not act, they will be derelict in their duties and we will have the legal authority to defend our rights. As American citizens we have a duty to protect the interests of the American people.

I am not calling for anyone to break the law. I’m demanding actions to restore the rule of law. I’m exercising my first amendment right to publicly point out that in the absence of political representation, we have an obligation to take non-violent direct action to restore the rule of law and the Constitution of the United States.

The Road Ahead…

The looting of the US economy that has occurred over the past two years is unprecedented in American history. You don’t have trillions of dollars looted from the economy and go on living business as usual. Most Americans have only a vague understanding of the collapse that we have been set up for. If you think the past two years were bad, and obviously they were, they were just a warm up to what is coming our way. After analyzing the policies in place and the current political environment, I can assure you that the next two years will be worse than the previous two.

As scary as it is to admit, I must conclude that we are only in the beginning phase of our decline. Millions more will be driven into poverty and unemployment. As this prolonged crisis continues the social safety-nets, like unemployment insurance and food stamps, the social safety-nets that have held our society together, will breakdown. Cuts to these vital social programs are going to be severe across the board. Draconian measures are just beginning to be rolled out in state after state across the country.

If you want to know where we are headed, a recent Boston Globe article by James Carroll shined a light on our dark future by revealing a well-established recent trend:

“… as federal corrections budgets increased by $19 billion, money for housing was cut by $17 billion, ‘effectively making the construction of prisons the nation’s main housing program for the poor.’ State budgets took their cues from Washington in a new but unspoken national consensus: poverty itself was criminalized. Although ‘law and order’ was taken to be a Republican mantra, this phenomenon was fully bipartisan.”

We already have more citizens in prison than any other country in the world. Our per capita incarceration rate is now on par to the darkest days of the Soviet Gulag.

What do you think is going to happen when the 52 million Americans already living in poverty can no longer afford to get the food that they need to live?

Unless there is a major shift in political policy, riots and social upheaval are coming. The mainstream media created bubble of reality that we have been all comfortably living in is about to burst. You need to prepare yourself for it.

Until we stop being so naïve and passive and realize that our country has been taken over by a financial terrorism network, until we demand that the rule of law is actually applied, our living standards will continue on the downward spiral that has only just begun.

You may think I’m be overly pessimistic or extreme, but I’m not. Open your own eyes, it doesn’t take much intelligence to see what is happening around us, it just takes some time to do the research and connect the dots. Turn off your TV set. Go online and look at what is happening throughout the world. People are taking to the streets and fighting back all over the world, and I’m not talking about in some backwoods country that you’ve never even heard of. Look at Europe, people are storming their government offices and departments of finance. They understand what is happening and they are defending their future. When will we?

Americans across the country are waking up completely broke, in debt they will never get out of and their job prospects are dire. The wrecking ball came through once and drove 50 million Americans into poverty. It is about to swing back again and take with it another 50 million of us. Our country has been attacked, looted and burnt to the ground economically.

We need to understand that we are in an all out economic world war right now, and we are being viciously attacked without forming any resistance.

The people attacking us are only one-tenth of one percent of the population. If we can recognize this fact and organize on common ground, we can win this war.

Are you ready to fight back?

I’ve made my decision. See you on the frontlines!

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States. To be notified via email about further articles from this series, subscribe here.

I: The CIA, BCCI & The Origins of Al Qaeda

Now that we have an understanding of how the Global Banking Intelligence Complex ran operations through BCCI, let’s look at how some of BCCI’s key players kept operating after the bank was finally shut down. As discussed in the last chapter, during the 1980s and early ’90s, the CIA worked in partnership with BCCI in what was, at the time, the agency’s largest covert operation ever, pumping an estimated $10 billion into funding the Afghan Mujahideen. Through this operation, Osama bin Laden’s al Qaeda network was formed. Bin Laden had accounts in BCCI and ran CIA/BCCI-funded camps.

In “ Modern Jihad:Tracing the Dollars Behind the Terror Networks,” investigative reporter Loretta Napoleoni described the origins of the al Qaeda network:

“[During the Afghan-Soviet war,] potential Arab warriors traveled to Pakistan where they resided in guesthouses. These hostels did not keep any records and not a single organization listed the names of the fighters, where they had gone to fight and if they had been injured or killed. The lack of vital information caused distress among relatives. At that time bin Laden was in charge of several guesthouses and was embarrassed by the hundreds of calls requesting information. Hence, he decided to keep track of whoever stayed at the hostels and that record came to be known as the Record of al-Qaeda. This is how al-Qaeda, which means the base or the scroll, was born.”

Throughout this time period, bin Laden’s mentor was a man named Gulbuddin Hekmatyar. In “Afghanistan 1979-1992: America’s Jihad,” William Blum reported some background information on Hekmatyar:

“His followers first gained attention by throwing acid in the faces of women who refused to wear the veil. CIA and State Department officials I have spoken with call him ’scary,’ ‘vicious,’ ‘a fascist,’… ‘definite dictatorship material’…. His name was Gulbuddin Hekmatyar. He was the head of the Islamic Party and he hated the United States almost as much as he hated the Russians. His followers screamed ‘Death to America’ along with ‘Death to the Soviet Union’… some of them had kidnapped the American ambassador in the capital city of Kabul, leading to his death in the rescue attempt… these same people shot down civilian airliners and planted bombs at the airport… anti-American mobs had burned and ransacked the US embassy in Islamabad and American cultural centers in two other Pakistani cities… their brother Islamic fundamentalists in next-door Iran seized the US Embassy in Teheran… and held 55 Americans hostage for over a year.”

Supporting acknowledged terrorists and enemies presented the US government with a huge public relations problem. So the White House and CIA went to work on the propaganda front. The United Sates Information Agency (USIA) launched the “Afghan Media Project.” The project was run by Joachim Maitre, a man who also worked with Oliver North to make TV ads attacking government officials who were against giving aid to the Contras during the BCCI-financed Iran-Contra Affair.

Reporting in “Covert Action: The Afghan Pipeline,” Steve Galster revealed the hypocrisy of the US propaganda campaign:

“Widespread corruption also exists among the [Afghan] rebel leaders but has gone practically unnoticed in the United States thanks to CIA propaganda. The same kinds of things that tarnished the Contras’ image, such as killing civilians, drug smuggling and embezzlement are practiced by many Afghan rebels. Taking no prisoners, assassinating suspected government collaborators, destroying government-built schools and hospitals, killing ‘unpious’ civilians are just a few of the inhumane acts they have carried out. But the picture we receive of the rebels in the United States is of an uncorrupt, popular group of freedom-loving people who aspire toward a democratic society.”

In “Jihad International Inc.,” Eqbal Ahmad further exposed the propaganda effort:

“They also invested in this Jihad the legitimacy of their enormous power, and the luster of their media-made glory. On one especially memorable occasion when Afghanistan’s hard-line Islamists visited the White House, President Ronald Reagan described them as the Muslim world’s ‘moral equivalent of our founding fathers.’ Similarly, the American and European media played up the war in Afghanistan as the greatest story of the eighties. Foreign correspondents combed the Hindu Kush for stories of ‘Mooj’ heroism. Competition for Jihad narrative was so great that in one instance a major network, CBS, paid handsomely to film a staged battle between Islam and Communism. As the western media carries great importance and authority in the third world, its Afghanistan war coverage made an enormous impact, especially on Muslim youth.”

As bin Laden himself would later say in his 1997 interview with CNN, “I have benefited so greatly from the Jihad in Afghanistan that it would have been impossible for me to gain such benefit from any other chance…”

Thanks to CIA funding and weapons, delivered through BCCI’s “black network” with the help of Pakistan’s intelligence service the ISI, bin Laden and al Qaeda were off and running. In 1992, just after BCCI had been shut down in a global sweep, the Afghan-Soviet war finally came to an end. The war resulted in the death of 1.3 million Afghans, three million were disabled, and 5.5 million became refugees – in total, about half the population.

When BCCI was shut down, most of its major players were allowed to walk away without being held accountable, due to the fact that BCCI was deeply entwined within the upper echelons of US intelligence. Elements of BCCI would then evolve into al Qaeda, as the Washington Post revealed in 2002:

“William F. Wechsler, who monitored bin Laden’s finances at the National Security Council during the last two years of the Clinton administration, told Congress in September that bin Laden initially rose to prominence for building ‘a financial architecture that supported the Mujaheddin in Afghanistan against the Russians.’

‘It’s this financial architecture that continued with him when he turned to terrorism, and it’s this financial architecture that is at the heart of how al Qaeda today gets its finances,’ he said.

Much of that architecture, according to French, Pakistani and American investigators, is modeled on the Bank of Credit and Commerce International (BCCI)…. In the 1980s it was used to launder drug money, harbor terrorist funds and buy illegal weapons. Its collapse in 1991 was a major global financial scandal.

The CIA used BCCI to funnel millions of dollars to the fighters battling the Soviet occupation of Afghanistan. Bin Laden had accounts in the bank, U.S. officials said….

The BCCI Model

A 70-page French intelligence report, prepared for Parliament in October and obtained by The Washington Post, outlined some details of this network. ‘The financial network of bin Laden, as well as his network of investments, is similar to the network put in place in the 1980s by BCCI for its fraudulent operations, often with the same people (former directors and cadres of the bank and its affiliates, arms merchants oil merchants, Saudi investors),’ the report said. ‘The dominant trait of bin Laden’s operations is that of a terrorist network backed up by a vast financial structure.’

A senior U.S. investigator said U.S. agencies were looking into these ties because ‘they just make so much sense, and so few people from BCCI ever went to jail. BCCI was the mother and father of terrorist financing operations.’

The report identifies dozens of companies and individuals who were involved with BCCI and were found to be dealing with bin Laden after the bank collapsed. Many went on to work in banks and charities identified by the United States and others as supporting al Qaeda.”

BCCI’s Chief Operations Officer and the man the US Senate Intelligence Committee considered to be “the most powerful banker in the Middle East,” Khalid bin Mahfouz, was let off with a fine and would become a major al Qaeda funder.

As the Washington Post report continued:

“The French report highlighted the role of Saudi banker Khalid bin Mahfouz, a former director of BCCI, whose sister is married to bin Laden. In 1995 bin Mahfouz paid a $225 million fine in a settlement with U.S. prosecutors for his role in the BCCI scandal and went on to serve as director of the National Commercial Bank, one of Saudi Arabia’s largest….

Saudi officials, at the urging of the United States, audited his bank and found that millions of dollars were being funneled through the bank to charities controlled by bin Laden, U.S. officials and the French document said…. U.S. intelligence officials said Washington pushed for the audit of bin Mahfouz’s bank but was never allowed to question him.

Saudi officials ‘weren’t willing to let us talk to him,’ said one U.S. source with direct knowledge of events, ‘and we asked at a very senior level.’”

One vital point that most of the US mainstream media obscured when revealing bin Mahfouz as a key al Qaeda funder was his heavy ongoing involvement with top US officials and oil companies throughout BCCI’s reign and after the bank’s collapse.

Editor’s Note: In an earlier version of this posting, we accepted an unreliable Boston Herald report of December 10th, 2001, which we reproduced without having access to a retraction published by the newspaper on February 19th, 2002. Our attention has been drawn to factual inaccuracies concerning the ownership of assets by an international business figure from which certain inappropriate conclusions were drawn by the newspaper. We have, therefore, removed this short section of the original article out of concern for accuracy and we apologize for any unintended distress caused to the individual concerned.

II: “The Strategy of the Silk Route” & 9/11

One of the world’s richest oil fields is on the eastern shore of the Caspian sea, just northwest of Afghanistan. The Caspian oil reserves are of top strategic importance in the quest to control the earth’s remaining oil supply. The U.S. government developed a policy called “The Strategy of the Silk Route.” The strategy was designed to lock out Russia, China, and Iran from the oil in this region. This called for U.S. corporations to construct an oil pipeline running through Afghanistan. Since the mid 1990s, a consortium of US oil companies led by Unocal, which was later bought by Chevron, have been pursuing this goal. The plan was to build a Trans-Afghanistan Pipeline from Turkmenistan’s natural gas fields to Pakistan. Unocal partnered with Saudi Delta Oil, which was owned by al Qaeda funder Khalid bin Mahfouz, and they formed Central Asia Gas Pipeline, Ltd. (CentGas).

A feasibility study for the Central Asian pipeline project was performed by Enron. This study concluded that as long as the country was split among fighting warlords the pipeline could not be built. Stability was necessary for the $4.5 billion project and the US believed that the Taliban would impose the necessary order. U.S. intelligence and Pakistan’s ISI then continued the close relationship that they established through BCCI and agreed to funnel arms and funding to the Taliban in their war for control of Afghanistan. Until 1999, US taxpayers paid the entire annual salary of every single Taliban government official. The U.S., Saudi and Pakistani alliance established within BCCI reunited to facilitate the rise of the Taliban.

The American oil interests at the heart of this pipeline deal took control of the White House on January 20, 2001, when George Bush Jr. became president. As previously mentioned, Enron was heavily involved in this oil deal. Enron CEO Ken Lay was an old Bush family friend and was Bush Jr.’s biggest campaign contributor. Donald Rumsfeld, who became the Secretary of Defense, was a large stockholder in Enron. Thomas White, former vice-chairman of Enron, became the Secretary of the Army. Condoleezza Rice, a former Chevron board member, became National Security Advisor and then Secretary of State. A major benefactor of the CentGas deal was going to be Halliburton. Dick Cheney, who became Vice President, was Halliburton’s CEO. Richard Armitage, who worked as a key lobbyist for Unocal, became Under Secretary of State. Hamid Karzai, who would later become Afghanistan’s Prime Minister, was a top Unocal adviser.

Shortly after taking office, the Bush Administration was quickly losing faith in the Taliban’s ability to control Afghanistan and be a reliable partner in the pipeline deal. James Baker, who was also a key BCCI player, having served as Treasury Secretary, Bush Sr.’s Secretary of State and Chief of Staff during BCCI’s reign, was a leading player in developing the “Strategy of the Silk Route.” In April 2001, Baker and the Council on Foreign Relations demanded immediate action and publicly released a Task Force Report entitled, “Strategic Energy Policy Challenges For The 21st Century,” by the James A. Baker III Institute. They stressed the urgency of the pipeline project and openly called for the Bush Administration to “quickly facilitate higher exports of oil from the Caspian Basin region…” and they reiterated the basic premise of the “Strategy of the Silk Route,” stating, “the exports from oil discoveries in the Caspian Basin could be hastened if a secure, economical export route could be identified swiftly.” That “export route,” as previously planned, would need to run through Afghanistan and into Pakistan.

The tangled web of conflicts of interests within the Bush Administration, oil industry, Taliban and al Qaeda were concisely summed up by investigative reporter Loretta Napoleoni:

“The CentGas deal never came to fruition. The Taliban’s inability to commit to any agreement, coupled with public recognition of the exploitive nature of their regime, contributed to its failure. For years, the Taliban skilfully conducted simultaneous negotiations with two potential oil companies: Argentinean Bridas [later bought by BP] and Unocal/CentGas. Both companies showered the Taliban with gifts and money, flying their delegations to the US to win them over. On one occasion, a group of Taliban met high-ranking executives of Unocal in Texas. Parties, dinners and trips to the local shopping malls were organized. At the same time, Zalmay Khalizad, who was working for Unocal, lobbied the Clinton administration to ‘engage’ with the Taliban. The press reported some of these ‘informal’ meetings between US officials and rulers of Afghanistan: ‘Senior Taliban leaders attended a conference in Washington in mid-1996 and US diplomats regularly traveled to Taliban headquarters,’ wrote the Guardian….

‘The United States wants good ties [with the Taliban] but can’t openly seek them while women are oppressed,’ reported CNN. None the less, negotiations carried on more or less openly until 1998, when bin Laden’s associates bombed US embassies in Africa. Clinton launched cruise missiles at bin Laden’s supposed whereabouts in Afghanistan, an act that convinced the oil lobby that, for the moment, the pipeline deal could not go ahead….

Corporate America continued to do business with people who supported Islamist insurgency. The oil industry, in particular, continues to be run by a very small group of American and Saudi families with close financial relations. Among them were the Bush family, the bin Laden family and Osama bin Laden’s Saudi sponsors. The ties among these people go back a long way….

Naturally, as soon as George W. Bush was elected president, Unocal and BP-Amoco, which had in the meantime bought Bridas, the Argentinean rival, started once again to lobby the administration, among whom were several of their former employees. Unocal knew that Bush was ready to back them and resumed the consortium negotiations. In January 2001, it began discussions with the Taliban, backed by members of the Bush administration among whom was Under Secretary of State Richard Armitage, who had previously worked as a lobbyist for Unocal. The Taliban, for their part, employed as their PR officer in the US Laila Helms, niece of Richard Helms, [BCCI player] former director of the CIA and former US ambassador to Iran. In March 2001, Helms succeeded in bringing Rahmatullah Hashami, Mullah Omar’s adviser, to Washington…. As late as August 2001, meetings were held in Pakistan to discuss the pipeline business….

While negotiations were underway, the US was secretly making plans to invade Afghanistan. The Bush Administration and its oil sponsors were losing patience with the Taliban; they wanted to get the Central Asian gas pipeline going as soon as possible. The ‘Strategy of the Silk Route’ had been resumed….

Paradoxically, 11 September provided the Washington with a casus belli to invade Afghanistan and establish a pro American government in the country. When, a few weeks after the attack, the leaders of the two Pakistani Islamist parties negotiated with Mullah Omar and bin Laden for the latter’s extradition to Pakistan to stand trial for the 11 September attacks, the US refused the offer. Back in 1996, the Sudanese Minister of Defence, Major General Elfaith Erwa, had also offered to extradite Osama bin Laden, then resident in Sudan, to the US. American officials declined the offer at that time as well. ‘Just don’t let him go to Somalia,’ they added…. When Erwa disclosed that he was going to Afghanistan, the American answer was ‘let him go’….

In November 2001… Hamid Karzai was elected [Afghanistan’s] prime minister…. Yet very few people remember that during the 1990’s Karzai was involved in negotiations with the Taliban regime for the construction of a Central Asian gas pipeline from Turkmenistan through western Afghanistan to Pakistan. At that time he was a top adviser and lobbyist for Unocal… In the early 1990’s, thanks to his [Karzai's] excellent contacts with the ISI, he moved to the US where he cooperated with the CIA and the ISI in supporting the Taliban’s political adventure.

President Bush’s special envoy to the newly formed Afghanistan state is a man named Zalmay Khalilzad, another former employee of Unocal. In 1997, he produced a detailed analysis of the risks involved in the construction of the Central Asian gas pipeline. Khalilzad also worked as a lobbyist for Unocal and therefore knows Karzai very well. In the 1980s… President Reagan named Khalilzad special adviser to the State Department; it was thanks to his influence that the US accelerated the shipment of military aid to the Mujahedin.”

Yet another interesting conflict of interest: the Chairman of the 9/11 Commission investigation was Thomas Kean. Kean was also a key player in this pipeline deal as a director of Hess Corp., which was in a joint venture called Delta Oil, with Khalid Bin Mahfouz. It is also important to mention that James Baker, who had a lead role in developing the “Strategy of the Silk Route” and BCCI operations, was hired by these same BCCI/Saudi/al Qaeda oil interests to defend them against lawsuits brought by families of 9/11 victims.

As mentioned in the last chapter, George Bush Sr.’s role in the BCCI Affair cannot be overstated. Even George Bush Jr. had oil companies that were funded by these same BCCI/Saudi/al Qaeda interests. To make matters even worse, the same person who played a pivotal role in covering-up and derailing investigations into BCCI at the Justice Department, was the person who was put in charge of the FBI on September 4, 2001, Robert Mueller – and he is still running the FBI under Obama.

In summation, the CentGas oil consortium that connected all of these interests with Bush Jr.’s administration are undeniably suspect, at best. All of these players and interests are so incestuous that the heated debate over whether or not 9/11 was an inside job is almost irrelevant when you understand the history behind it. Whether it was an attack by al Qaeda or a false flag covert intelligence operation to win public support and trillions of taxpayer dollars for the never-ending “War on Terror” and control of Central Asian oil is essentially a non-issue. The main point, which cannot be legitimately argued, is that 9/11 would never have happened if it wasn’t for an out-of-control intelligence apparatus, and we now know the people who were operating that intelligence apparatus. All of the players involved were part of the same banking intelligence network known as BCCI. Al Qaeda and 9/11 were a direct outgrowth and evolution of BCCI intelligence operations. It was the same people, continuing to do what they had been doing all along, except this time their target was on US soil.

And this same out-of-control intelligence apparatus was the biggest beneficiary of 9/11, having had their funding budgets more than doubled since the attack. Knowing how uncontrollable the intelligence world was leading up to 9/11, let’s look again at this report from the Washington Post:

“The top-secret world the government created in response to the terrorist attacks of Sept. 11, 2001, has become so large, so unwieldy and so secretive that no one knows how much money it costs, how many people it employs, how many programs exist within it or exactly how many agencies do the same work…. After nine years of unprecedented spending and growth, the result is that the system put in place to keep the United States safe is so massive that its effectiveness is impossible to determine…. The U.S. intelligence budget is vast, publicly announced last year as $75 billion, 2 1/2 times the size it was on Sept. 10, 2001. But the figure doesn’t include many military activities or domestic counterterrorism programs.”

III: The Road to World War III

The war for a pipeline to extract oil from the Caspian Sea is far from over. China, a country US oil interests were determined to block out of the region, has been making moves to take control and has clearly established the upper hand. In a TomDispatch report entitled, “Pipelineistan’s New Silk Road,” Asia Times correspondent Pepe Escobar reports:

“Future historians may well agree that the twenty-first century Silk Road first opened for business on December 14, 2009. That was the day a crucial stretch of pipeline officially went into operation linking the fabulously energy-rich state of Turkmenistan (via Kazakhstan and Uzbekistan) to Xinjiang Province in China’s far west….

The bottom line is that, by 2013, Shanghai, Guangzhou, and Hong Kong will be cruising to ever more dizzying economic heights courtesy of natural gas supplied by the 1,833-kilometer-long Central Asia Pipeline, then projected to be operating at full capacity…. When the Bush administration’s armchair generals launched their Global War on Terror, this was not exactly what they had in mind.

Meanwhile, in the New Great Game in Eurasia, China had the good sense not to… get bogged down in an infinite quagmire in Afghanistan. Instead, the Chinese simply made a direct commercial deal with Turkmenistan and, profiting from that country’s disagreements with Moscow, built itself a pipeline which will provide much of the natural gas it needs.

No wonder the Obama administration’s Eurasian energy czar Richard Morningstar was forced to admit at a congressional hearing that the U.S. simply cannot compete with China when it comes to Central Asia’s energy wealth. If only he had delivered the same message to the Pentagon….

If China has so far proven masterly in the way it has played its cards in its Pipelineistan ‘war’, the U.S. hand — bypass Russia, elbow out China, isolate Iran — may soon be called for what it is: a bluff.”

If you have wondered why so many US/NATO/private military troops have been deployed to the Af-Pak region, just consider that China, which shares a border with Pakistan and Afghanistan, has also begun moving troops into the region (it is also important to note that Iran is surrounded by Afghanistan and Iraq). As a New York Times report stated:

“[Pakistan] is handing over de facto control of the strategic Gilgit-Baltistan region in the northwest corner of disputed Kashmir to China.

The entire Pakistan-occupied western portion of Kashmir stretching from Gilgit in the north to Azad (Free) Kashmir in the south is closed to the world, in contrast to the media access that India permits in the eastern part, where it is combating a Pakistan-backed insurgency. But reports from a variety of foreign intelligence sources… reveal two important new developments in Gilgit-Baltistan: a simmering rebellion against Pakistani rule and the influx of an estimated 7,000 to 11,000 soldiers of the [Chinese] People’s Liberation Army.

China wants a grip on the region to assure unfettered road and rail access to the Gulf through Pakistan. It takes 16 to 25 days for Chinese oil tankers to reach the Gulf. When high-speed rail and road links through Gilgit and Baltistan are completed, China will be able to transport cargo from Eastern China to the new Chinese-built Pakistani naval bases at Gwadar, Pasni and Ormara, just east of the Gulf, within 48 hours.”

As the war in Afghanistan continues to escalate over the border into Pakistan, you can be assured that China, Russia and Iran will become more militarily involved in defense of their region’s resources. Pakistan is already becoming increasingly hostile to an escalation of US drone and NATO strikes within its borders, and have even begun to openly aid the Taliban by cutting off key NATO supply lines. Pakistan has also recently deployed anti-aircraft missiles on its border with Afghanistan. Current intelligence leads one to conclude that the war will continue to expand further into Pakistan, which will lead to China and Iran becoming more involved in what is essentially a proxy war against US/NATO/private military forces.

The bottom line, and one of the main themes of this book, is that we have entered a period of major wars over declining resources. The Af-Pak operations are only initial moves in an attempt to control the earth’s remaining oil supply.

Any talks of troop withdrawals from the Af-Pak region and Iraq are psychological operations. US/NATO/private military contractors are still in the process of building the world’s largest military bases in this region, they are not going to abandon these newly constructed mega-bases. These bases are designed to be operational and, as oil continues to become more scarce, they will be used to militarily control the remaining supply throughout this region.

Chris Martenson, a former Vice President at intelligence company SAIC, recently wrote the following in an analysis entitled, “Future Chaos: There Is No ‘Plan B’:”

“The future is likely to be more chaotic than you probably think. This was the primary conclusion that I came to after attending the most recent Association for the Study of Peak Oil & Gas (ASPO) in Washington, DC in October, 2010…. The impact of Peak Oil on markets, lifestyles, and even national solvency deserves our very highest attention…. Rear Admiral Lawrence Rice… presented the findings of the 2010 Joint Operating Environment (a forward-looking document examining the trends, contexts, and implications for future joint force commanders in the US military), which spends 76 pages summarizing the key trends and threats of the world…. Peak Oil dominates the discussion. Among the conclusions (on page 29), we find this:

‘By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD.’”

The  Joint Operating Environment report goes on to reveal:

“To meet climbing global requirements, OPEC will have to increase its output from 30 MBD to at least 50 MBD. Significantly, no OPEC nation, except perhaps Saudi Arabia, is investing sufficient sums in new technologies and recovery methods to achieve such growth. Some, like Venezuela and Russia, are actually exhausting their fields to cash in on the bonanza created by rapidly rising oil prices….

A severe energy crunch is inevitable without a massive expansion of production and refining capacity. While it is difficult to predict precisely what economic, political, and strategic effects such a shortfall might produce, it surely would reduce the prospects for growth in both the developing and developed worlds….”

Increasing OPEC output up to 50 MBD from the current level of 30 MBD is simply not possible, in fact it’s absurd to even consider that as a possibility. Once you disregard that, as the report states, “A severe energy crunch is inevitable.” To make matters even worse, we are much more likely to see a steady decline in output. So war with Pakistan, China, Russia and Iran, along with continued military operations in Afghanistan and Iraq, is increasingly probable, and their planned strategy.

Their strategy becomes all the more apparent when you consider the ramp up in military exercises and drills around China, which has included a series of massive 86,000-troop war games throughout the Korean Peninsula. Add in the recent record-setting $123 Billion in weapons sales to Gulf nations, with Saudi Arabia getting $67.8 Billion in weapons, which was the largest US arms deal ever. Israel also recently purchased 20 F-35 fighter jets for $2.5 billion, and has recently conducted their largest ever joint military exercises with the US. [See Moves Upon the Grand Chessboard for more information. In the next part of this series, we will take a close look at how Iraq fits into this picture.]

Now that we have a basic understanding of how much effort has gone into controlling Middle East and Caspian oil, and as demand for oil increases as production decreases, we can easily see how this is going to become an increasingly dangerous and hostile situation. If we stay on this present course, the “Strategy of the Silk Route” leads us straight down the road to World War III.

IV: War Racket: The Global Banking Intelligence Complex Business Plan

One of the reactions a person may have after learning this information, is to believe that perhaps these wars to control the earth’s remaining oil supply are beneficial to the US population. It may even eventually be a clever propaganda strategy to paint these wars as preserving the American way of life and our standard of living by obtaining these vital resources. Coming to this belief would be tremendously naïve.

As recent history has proved, US oil interests and the bankers behind them are global in nature and they don’t have any loyalty to the American people. As their actions have clearly demonstrated, they use the oil, and the obscene profits obtained from it, for their own short-sighted personal gain, at the brutal expense of the overwhelming majority of humanity and at the extraordinary expense of the earth’s ecosystem. Americans are shielded from the enormous inhumanity of millions of maimed and dead bodies as a result of their addiction to power. If these wars continue to escalate, they will inevitably lead to more attacks on American soil.

The profits from these wars are also a primary driving factor in having them in the first place, and is a major incentive to keep them going. Billions of taxpayer dollars are thrown around in the “fog of war,” in what is called a “free-fraud zone.” The military companies and the bankers behind them reap huge profits in the process. So fighting these highly profitable wars, for highly profitable resources, is the ultimate win-win situation, and the deliberately chosen business model for the Global Banking Intelligence Complex.

A point that clearly demonstrates the parasitic nature and pure insanity of this: the world’s #1 polluter and consumer of oil is the US/NATO/private military machine. So while they so desperately fight for oil, they are burning up significant amounts of it in the process.

The fact that the average American never gets the information presented in this report via mainstream media proves how tightly controlled the corporate media is. It also clearly demonstrates the blatant fact that the Global Banking Cartel doesn’t want American citizens to have even a basic understanding of geo-strategic interests and how power really functions. Above all, the American public must be kept in its place, as the cartel emphatically believes that they are the kings and we are the serfs, and it is none of our business how they conduct themselves. If you are not already a multi-millionaire or billionaire, you have now been marked for either servitude or slow death. That is a very harsh truth, but in the new world of declining resources, looted economies and environmental upheaval, this is the unfortunate reality of the situation. Until the American public can wake up to this new reality, turn off the television and fight back, our living standards will continue to decline at an increasing rate.

Editor’s Note: In an earlier version of this story, we cited a report published in the Boston Herald on Dec. 10th, 2001. The report contained inaccuracies and the Herald retracted portions of it on Feb. 19, 2002. However, the retracted version was not immediately accessible and we relied upon the original Dec. 10, 2001 story when preparing this investigative report. We were made aware of the factual inaccuracies concerning the ownership of assets by an international business figure from which erroneous conclusions were reached by by the Herald. We have, therefore, removed that portion of the story apologize for any unintended distress caused to the individual concerned.

The next part of this series will be posted in a few days. Stay tuned for “The Covert Origins of the Iraq War: BCCI, Kissinger Associates, SAIC, & Robert Gates.”

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States. To be notified via email about further articles from this series, subscribe here.

Editor’s Note

To get a more complete understanding of our current crisis, we need to look at the history of events that led up to it. We need to peer deeply into the inner workings of the Global Banking Intelligence Complex. Without acknowledging and exposing the covert forces that are aligned against us, we will not be able to effectively overcome them.

In the past I have shied away from going too deeply into the details of the intelligence world out of fear of being written off and dismissed as a conspiracy theorist. If I hadn’t spent the majority of the past 20 years investigating global financial intelligence operations, I certainly wouldn’t believe half of this myself. Given the severity of our current crisis and the imminent devastating implications, I now realize that I must go deeper into covert activities than I publicly ever have. The information I am about to report is very well-sourced and documented, and needs to be covered before we can proceed to exposing present operations.

I: All Roads Go Through BCCI

Here is a partial list of the economic and political scandals that I investigated throughout the 1980s and early ’90s:

The Savings & Loan scandal;

Stock market manipulation and money laundering;

Iran-Contra Affair;

The October Surprise and Iran hostage crisis;

Iraqgate-BNL and the rise and funding of Saddam Hussein;

Pakistan’s nuclear program and the selling of bomb-making technology to Libya, Iran and North Korea;

The rise and funding of the Afghan Mujahideen (founding and funding of the Taliban and Osama bin Laden’s Al Qaeda network);

Illegal weapon sales to Iran and Saudi Arabia;

The proliferation of Middle Eastern terrorism;

The international drug trade run by people like Manuel Noriega and Pablo Escobar.

All of these scandals had one vital thing in common, the Bank of Credit and Commerce International (BCCI).

In December 1992, the US Senate Foreign Relations Committee on Terrorism, Narcotics and International Operations delivered a report on their investigation into the bank, entitled “The BCCI Affair.” The report would disclose the largest political corruption case in the history of the global economy. As the Senate Committee summed it up:

“BCCI’s criminality included fraud by BCCI and BCCI customers involving billions of dollars; money laundering in Europe, Africa, Asia, and the Americas; BCCI’s bribery of officials in most of those locations; support of terrorism, arms trafficking, and the sale of nuclear technologies; management of prostitution; the commission and facilitation of income tax evasion, smuggling, and illegal immigration; illicit purchases of banks and real estate; and a panoply of financial crimes limited only by the imagination of its officers and customers.

Among BCCI’s principal mechanisms for committing crimes were its use of shell corporations and bank confidentiality and secrecy havens; layering of its corporate structure; its use of front-men and nominees, guarantees and buy-back arrangements; back-to-back financial documentation among BCCI controlled entities, kick-backs and bribes, the intimidation of witnesses, and the retention of well-placed insiders to discourage governmental action.”

The BCCI scandal gave citizens of the world a rare glimpse into the inner workings of the covert global banking intelligence power structure, revealing power politics in its purest form. BCCI was modeled after the world’s most powerful intelligence agencies and multinational corporations. It represented the evolution of organized crime into the new world of the global economy, rendering nation-states obsolete. BCCI transcended religions and nationalities; it cut across the entire political spectrum, uniting countries and groups that, on the surface, were considered rivals, yet were unified in their pursuit of power.

BCCI consisted of a complex alliance of intelligence agencies, multinational corporations, weapons dealers, drug traffickers, terrorists, global bankers and high-ranking government officials. It involved leaders from 73 countries and formed what was described as “an elaborate corporate spider web.”

As former US Senate investigator Jack Blum described it:

“The problem that we are all having in dealing with this bank is that… it had 3,000 criminal customers and every one of those 3,000 criminal customers is a page one story. So if you pick up on one of [BCCI's] accounts you could find financing from nuclear weapons, gun running, narcotics dealing, and you will find all manner and means of crime around the world in the records of this bank.”

BCCI would become known as the Bank of Crooks and Criminals with clientele such as Saddam Hussein, Manuel Noriega, Pablo Escobar, Abu Nidal, the Qassar brothers, Muammar Gaddafi, Ben Banerjee, Cyrus Hashemi, Ferdinand Marcos, Rodriguez Gacha, Alan Garcia, Daniel Ortega, Adolfo Calero, Adnan Khashoggi, Manucher Ghorbanifar, Sarkis Soghanalian, the Palestine Liberation Organization, Islamic Jihad holy warriors the Mujahideen, including Osama bin Laden and many others.

In a 1991 Time magazine article entitled, “The Dirtiest Bank of All,” investigative journalists Jonathan Beaty and S.C. Gwynne summed up BCCI this way:

“Nothing in the history of modern financial scandals rivals the unfolding saga of the Bank of Credit & Commerce International, the $20 billion rogue empire that regulators in 62 countries shut down early this month in a stunning global sweep. Never has a single scandal involved so much money, so many nations or so many prominent people.

Superlatives are quickly exhausted: it is the largest corporate criminal enterprise ever, the biggest Ponzi scheme, the most pervasive money-laundering operation and financial supermarket ever created for the likes of Manuel Noriega, Ferdinand Marcos, Saddam Hussein and the Colombian drug barons.”

In another report Beaty and Gwynne added:

“This is the story of how the wealthy and corrupt in Latin America managed to steal virtually every dollar lent to their countries by Western banks, creating the debt crisis of the 1980s; how heads of state… skimmed billions from their national treasuries and hid them in Swiss and Caymanian accounts forever free from snooping regulators; how Pakistan and Iraq got materials for nuclear weaponry and how Libya built poison-gas plants.”

II: BCCI & US Intelligence

Even though BCCI was a Middle Eastern-based bank, investigations by the US Senate, NY Attorney General Robert Morgenthau and several award-winning journalists revealed that BCCI was run by the CIA and top US officials. CIA covert operations were run through BCCI’s “black network.” Former CIA directors George Bush Sr., William Casey and Richard Helms, former Defense Secretary Clark Clifford and former Secretary of State Henry Kissinger were all key players and shielded the bank from investigations throughout its reign. BCCI founder Agha Hasan Abedi and former CIA director William Casey met secretly for years. BCCI’s Mohammed Irvani was partners with former CIA director Richard Helms. BCCI frontmen Kamal Adham and A.R. Khalil were top Saudi intelligence directors and primary CIA liaisons for the entire Middle East. Many high-ranking Republicans and Democrats were vital to the bank’s operations, along with top corporate executives at First American Bank, Bank of America, PR firm Hill & Knowlton, cable company TCI, and auditing firms Price Waterhouse and Ernst & Young – to name just a few US companies that played crucial roles.

The CIA, DIA, and NSC used BCCI as their own private bank, sending billions of dollars in covert funding and weapons to organizations and countries with which we are now in conflict – most notably the Mujahideen in Afghanistan (which evolved into Al Qaeda and the Taliban), Pakistan’s ISI, Saddam Hussein in Iraq and the government of Iran.

BCCI investigations gave us the most detailed and well-documented view into the inner workings of the “war racket” that we have ever had. The BCCI Affair blatantly exposed how global intelligence agencies and banking interests covertly fund terrorists and drug cartels all over the world. As investigative reporter Chris Floyd wrote, “Instead of stopping the drug-runners and terrorists, the CIA decided to join them, using BCCI’s secret channels to finance ‘black ops’ all over the world.”

Reporting in Time magazine, Beaty and Gwynne revealed some of the details:

“From interviews with sources close to B.C.C.I., TIME has pieced together a portrait of a clandestine division of the bank called the ‘black network,’ which functions as a global intelligence operation and a Mafia-like enforcement squad…. The black network — so named by its own members — stops at almost nothing to further the bank’s aims the world over.

The more conventional departments of B.C.C.I. handled such services as laundering money for the drug trade and helping dictators loot their national treasuries. The black network, which is still functioning, operates a lucrative arms-trade business and transports drugs and gold. According to investigators and participants in those operations, it often works with Western and Middle Eastern intelligence agencies. The strange and still murky ties between B.C.C.I. and the intelligence agencies of several countries are so pervasive that even the White House has become entangled. As TIME reported earlier this month, the National Security Council used B.C.C.I. to funnel money for the Iran-contra deals, and the CIA maintained accounts in B.C.C.I. for covert operations. Moreover, investigators have told TIME that the Defense Intelligence Agency has maintained a slush-fund account with B.C.C.I., apparently to pay for clandestine activities….

The black network was a natural outgrowth of B.C.C.I.’s dubious and criminal associations…. Its original purpose was to pay bribes, intimidate authorities and quash investigations. But according to a former operative, sometime in the early 1980s the black network began running its own drugs, weapons and currency deals….

Sources have told investigators that B.C.C.I. worked closely with Israel’s spy agencies and other Western intelligence groups as well, especially in arms deals. The bank also maintained cozy relationships with international terrorists, say investigators who discovered suspected terrorist accounts for Libya, Syria and the Palestine Liberation Organization in B.C.C.I.’s London offices….

U.S. intelligence agencies were well aware of such activities. ‘B.C.C.I. played an indispensable role in facilitating deals between Israel and some Middle Eastern countries,’ says a former State Department official. ‘And when you look at the Saudi support of the contras, ask yourself who the middleman was: there was no government-to-government connection between the Saudis and Nicaragua.’”

III: Af-Pak Covert Operations

The CIA worked in partnership with BCCI in what was, at the time, the agency’s largest covert operation ever, pumping an estimated $10 billion into funding the Afghan Mujahideen’s anti-Soviet Jihad.

In a 1992 article entitled, “The Riyadh Connection,” Time magazine reported:

“B.C.C.I. was similarly entwined in another key U.S. intelligence operation of the 1980s: the supply of arms and money to the Afghan rebels. While such clandestine support was legally condoned, B.C.C.I. officials have told reporters that CIA Director William Casey… struck a deal that included off-the-books operations never reported to the U.S. Congress.”

Pakistan would play a pivotal role in support of the Afghan Mujahideen. Pakistan was run by a corrupt militant oligarchy and was the operational home of BCCI. In “ Modern Jihad: Tracing the Dollars Behind the Terror Networks,” investigative reporter Loretta Napoleoni revealed details:

“As soon as Abedi’s bank [BCCI] came on board, all [CIA] covert operations were passed to its ‘black network’, virtually a secret banking institution within the bank. Its headquarters were in Karachi and it was from this city that the underground network acted as a full-service bank for the CIA. With about 15,000 employees, it operated in a similar fashion to the Mafia. It was a fully integrated organization; it financed and brokered covert arms deals among different countries, it shipped goods using its own fleet, insured them with its own agency and provided manpower and security en route. In Pakistan, BCCI officials knew whom to bribe and when to do it. They also knew where to channel the funds. Richard Kerr, the former CIA director who admitted that the CIA had secret BCCI accounts in Pakistan, confirmed that those accounts had been opened to distribute the CIA funds to Pakistani officers and members of the Afghan resistance. By the mid-1980s, the black network had gained control of the port of Karachi and handled all customs operations for CIA shipments to Afghanistan, including the necessary bribes for the ISI [Pakistan’s intelligence service]. It was BCCI’s job to make sure that cargoes of arms and equipment were discharged quickly….

As the war progressed, costs soared. There was constant shortage of money along the pipeline to supply the Mujahedin and so the ISI and CIA began looking for additional sources of income. One that proved viable was drug smuggling. Soon the narcotics-based economy took over the traditional agrarian economy of Afghanistan…. Within two years the Pakistan-Afghanistan borderland had become the biggest centre for the production of heroin in the world and the single greatest supplier of heroin on American streets, meeting 60 per cent of the US demand for narcotics. Annual profits were estimated between $100 billion and $200 billion. . . . In 1995, the former CIA director of Afghan operations, Charles Cogan, admitted that the CIA had indeed sacrificed the drug war to fight the Cold War.”

In “Afghanistan 1979-1992: America’s Jihad,” investigative journalist Tim Weiner reported:

“The CIA’s pipeline leaked. It leaked badly. It spilled huge quantities of weapons all over one of the world’s most anarchic areas. First the Pakistani armed forces took what they wanted from the weapons shipments. Then corrupt Afghan guerrilla leaders stole and sold hundreds of millions of dollars’ worth of anti-aircraft guns, missiles, rocket-propelled grenades, AK-47 automatic rifles, ammunition and mines from the CIA’s arsenal. Some of the weapons fell into the hands of criminal gangs, heroin kingpins and the most radical faction of the Iranian military…. While their troops eked out hard lives in Afghanistan’s mountains and deserts, the guerrillas’ political leaders maintained fine villas in Peshawar and fleets of vehicles at their command. The CIA kept silent as the Afghan politicos converted the Agency’s weapons into cash.”

Through this operation Osama bin Laden’s Al Qaeda network was formed. Bin Laden had accounts in BCCI and ran a CIA/BCCI-funded camp. [I'll go into further detail on this aspect of the BCCI Affair in the next report.]

BCCI also funded Pakistan’s nuclear weapons program when they set up the Khan Institute of Engineering Sciences and Technology. Pakistan then went on to sell the technology to Libya, Iran and North Korea. As a Chicago Sun Times report summed it up:

“[Pakistan's] President Pervez Musharraf has pledged that the disgraced founder of Pakistan’s nuclear weapons program can keep the vast wealth he accumulated selling bomb-making technology to rogue states around the world. Just days after Musharraf provoked worldwide consternation by pardoning Abdul Qadeer Khan for supplying nuclear expertise to Libya, Iran and North Korea, he told the Sunday Telegraph he would also spare the scientist’s property or assets. ‘He can keep his money,’ Musharraf said, adding there had been good reason not to investigate the origin of Khan’s suspicious wealth before 1998, when Pakistan successfully tested its first nuclear weapon. ‘… you have to ask yourself whether you act against the person who enabled you to get the bomb.’ Khan is thought to have earned millions of dollars from his sale of nuclear know-how, beginning in the late 1980s. Much of the money was funneled through [BCCI] bank accounts in the Middle East.”

IV: Iran-Contra Affair

George Bush Sr. and current Secretary of Defense Robert Gates were key players in the BCCI financed Iran-Contra Affair. As the US Independent Counsel For Iran/Contra Matters investigation stated:

“Robert M. Gates was the Central Intelligence Agency’s deputy director for intelligence (DDI) from 1982 to 1986. He was confirmed as the CIA’s deputy director of central intelligence (DDCI) in April of 1986 and became acting director of central intelligence in December of that same year. Owing to his senior status in the CIA, Gates was close to many figures who played significant roles in the Iran/contra affair and was in a position to have known of their activities.”

Leslie Alan Aspin, a British CIA agent who was killed in 1989, had classified documents proving Bush Sr.’s involvement in illegal covert weapon sales to Iran. A 1991 report in New York Magazine by Christopher Byron revealed some details and was later summed up in The Reference Shelf:

“In a ten-page statement dated May 1. 1987, Aspin describes how he organized a 1984 BCCI financed TOW missile shipment from Portugal to Iran on behalf of Oliver North. Though North was at that time on the staff of the National Security Council, his recently declassified diaries indicate that he was spending much of his time working for Bush.”

Key Iran-Contra asset Oliver North was involved in the operations and was working directly for Bush Sr., who was Vice President at the time. North maintained several accounts in BCCI which he used to finance his covert operations. As Time magazine reported:

“… the National Security Council used B.C.C.I. to funnel money for the Iran-contra deals…. When American arms destined for Iran and Iraq passed through Israel, for example, B.C.C.I. was frequently the broker and financier…. There was, for example, the highly sensitive question of B.C.C.I.’s direct involvement in the secret arms-for-hostages deals in Iran during the 1980s, in which it acted as a broker and financier of weapons sales. Ollie North maintained three accounts at the B.C.C.I. Paris branch, and B.C.C.I. was used to transfer money to the contras.”

George Bush Sr. would go on to pardon convicted Iran-Contra figures – former Defense Secretary Caspar Weinberger and five former CIA employees; Elliott Abrams, Robert McFarlane, Duane Clarridge, Alan Fiers, and Clair George. Robert Gates then went on to serve as Director of the CIA under Bush Sr., and is currently serving as Secretary of Defense under President Obama, having been selected to that position by former President George Bush Jr..

V: Kissinger Associates & Iraqgate-BNL

George Bush Sr. and former Secretary of State Henry Kissinger were also heavily involved in another illegal covert operation run through an Italian BCCI-linked bank called Banca Nazionale del Lavoro (BNL). BNL was used to covertly funnel billions of dollars to Saddam Hussein. This scandal would become known as Iraqgate.

In April 1992, former Congressmen Henry B. Gonzalez (TX-20) stated the following in the Congressional Record:

“Kissinger Associates, Scowcroft, Eagleburger, Stoga, Iraq, and BNL

Mr. GONZALEZ: ‘Mr. Speaker, today I will talk about Henry Kissinger, his consulting firm Kissinger Associates, two former Kissinger Associates directors, Lawrence Eagleburger and Brent Scowcroft, and the chief economist at Kissinger Associates, Alan Stoga.

I will explore their links to Banca Nazionale del Lavoro [BNL] and Iraq, and the Bush administration’s handling of the BNL scandal. But first, I will provide some background information on the BNL scandal….

The $4 billion plus in BNL loans to Iraq between 1985 and 1990 were crucial to Iraqi efforts to feed its people and to build weapons of mass destruction. In addition, the BNL loans were crucial to Reagan and Bush administration efforts to assist Saddam Hussein….

It is truly amazing that the BNL scandal went on as long as it did. Various agencies within our Government knew of BNL’s role in bankrolling Iraq–yet they supposedly did not know that the loans were unauthorized or not properly reported….

Several of BNL’s high level friends in the United States should have been aware of the BNL loans to Iraq. The high level patrons that I am referring to are Henry Kissinger, and his Kissinger Associates compadres, Brent Scowcroft and Lawrence Eagleburger….

I will reveal that both Mr. Eagleburger and Mr. Scowcroft played a key role in the Bush administration’s handling of the BNL scandal, even though BNL was a paying client of Kissinger Associates just months prior to the BNL scandal becoming public….

Kissinger Deliberately Misleads Public

Until recently, Mr. Kissinger was a member of the BNL’s international advisory board and during the height of the BNL-Atlanta scandal BNL was a paying client of Kissinger Associates.

While Henry Kissinger was a paid member of the BNL’s advisory board for international policy between 1985 and June 1991, he received at least $10,000 for attending each meeting of the BNL advisory board.

Other BNL advisory board members included David Rockefeller, the chairman of the Rockefeller Group and a director of Chase Manhattan Bank, Pierre Trudeau, the former Prime Minister of Canada, Lord Thornycroft, the former British Minister of Defense, and other politically well-connected international notables.

After my April 25, 1991, floor statement on Mr. Kissinger, he told the Financial Times newspaper that he had resigned from the BNL advisory board a week before the BNL indictment in February 1991 because `he did not want to answer questions about such incidents.’

Two weeks ago, the prominent TV show, ‘60 Minutes,’ revealed that Kissinger had not resigned from the BNL advisory board in February 1991, as he had told the Financial Times. In fact, `60 Minutes’ reported that Mr. Kissinger served on BNL’s advisory board until his contract expired in the summer of 1991, more than 4 months after the date he had previously reported.

Mr. Kissinger was not the only Kissinger Associates employee that dealt with BNL. Mr. Brent Scowcroft, the vice chairman and Mr. Lawrence Eagleburger, the president of Kissinger Associates also had relationships with BNL.

Brent Scowcroft, BNL, and Iraq

One of the most prominent of the Kissinger Associates alumni is Brent Scowcroft, President Bush’s current National Security Adviser and head of the NSC staff. . . .

Scowcroft often took charge of the National Security Council while Kissinger was fulfilling his duties as Secretary of State, and in 1975 he succeeded Kissinger as National Security Adviser to President Ford….

In 1982, Scowcroft joined Kissinger in setting up Kissinger Associates. Scowcroft served as vice chairman and head of Kissinger Associate’s Washington, DC, office until becoming the head of the National Security Council under President Bush in January 1989….

Alan Stoga–Kissinger Associates

Another link between Kissinger Associates, BNL and Iraq is Alan Stoga. Alan Stoga is a former economist at First Chicago Bank and is currently a director of Kissinger Associates. Mr. Stoga is said to be an expert in country risk analysis and international finance. He has been interested in the Middle East for many years and has made extensive visits to the area….

Conclusion

BNL was a client of Mr. Scowcroft’s while he was the vice-chairman of Kissinger Associates. Mr. Scowcroft regularly provided advice to BNL’s management and received hefty fees in return.

Mr. Scowcroft and his staff at the National Security Council, along with the State Department, masterminded the Bush administration’s handling of the BNL scandal in order to mitigate the damage it would have caused to United States-Iraq relations. In the process they trampled on United States law enforcement efforts and repeatedly misled the Congress and the American public about the United States policy toward Iraq….

As for Mr. Kissinger, he misled the public about his relationship with BNL and about his firm’s contact with Saddam Hussein. Mr. Stoga misled the Banking Committee about the reasons for his trip to Iraq in the summer of 1989 when he met with Saddam Hussein to discuss Iraq’s debt problems.’”

Kissinger and his firm Kissinger Associates played a key role throughout BCCI’s entire existence. The Senate investigation report had an entire chapter focusing on Kissinger’s role, entitled “BCCI And Kissinger Associates.” After the report was released to the Senate Foreign Relations Committee, Henry Kissinger got them to redact several sections from the Government Printing Office’s final hardcopy version.

VI: The Ultimate Conspiracy: The BCCI Cover-Up

In Jonathan Beaty and S.C. Gwynne’s ground-breaking book on BCCI, entitled “The Outlaw Bank,” they detailed the overwhelming evidence proving the dominant role US intelligence, governmental agencies and global banking interests played in BCCI operations and in covering up the bank’s scandalous and illegal activities. As they reported:

“Perhaps the most disturbing aspect of the BCCI affair in the United States was the failure of U.S. government and federal law enforcement to move against the outlaw bank. Instead of swift retribution, what took place over more than a decade was a cover-up of major, alarming proportions, often orchestrated from the very highest levels of government. When the Justice Department finally moved decisively against BCCI in late 1991, it did so reluctantly.”

As the US Senate report revealed:

“The political connections of BCCI’s U.S. lawyers and lobbyists were critical to impeding Congressional and law enforcement investigations from 1988 through 1991, through a variety of techniques that included impugning the motives and integrity of investigators and journalists, withholding subpoenaed documents, and lobbying on Capitol Hill to protect BCCI’s reputation and discourage efforts to close the bank down in the United States.”

As Beaty and Gwynne revealed in detail, government documents exposing BCCI’s criminality went back to 1979. As they wrote, “authentic, unambiguous information” on the bank’s illegal activity was presented to the State Department, Justice Department, Drug Enforcement Agency, Internal Revenue Service, Commerce Department, Customs Department, Central Intelligence Agency, National Security Agency, Defense Intelligence Agency, Department of Energy, and the White House’s National Security Council.

Perhaps more than anyone, the Treasury Department and Federal Reserve had extensive information on BCCI’s criminal activities. As investigations revealed, “the detail of information was exceptional.” During pivotal BCCI years, James Baker, after serving as President Reagan’s Chief of Staff, was Treasury Secretary from 1985 – ‘88. After Baker left the Treasury Department, he became Bush Sr.’s Secretary of State from 1989 – ‘92. At the Federal Reserve, Alan Greenspan, after serving as a director at the Council on Foreign Relations, became Fed Chairman in 1987 and served in that position throughout BCCI’s reign.

VII: Wall Street & US Banking Industry

BCCI penetrated deeply into Wall Street and the US banking industry. With the help of former Defense Secretary Clark Clifford, BCCI secretly owned Washington’s largest bank, First American, and Bank of America was a vital BCCI lifeline. As Beaty and Gwynne revealed:

“B.C.C.I. even accomplished a Stealth-like invasion of the U.S. banking industry by secretly buying First American Bankshares, a Washington-based holding company with offices stretching from Florida to New York….

Five of Bank of America’s senior officers were either on BCCI’s board of directors or helped to manage Abedi’s bank. For the next decade the two banks would move billions of dollars a week through each other’s international offices, and the Bank of America would be an invaluable, if hidden, ally, since it would continue to accept BCCI’s letter-of-credit business after virtually no other Western bank would touch it. Indeed, it could be argued that Bank of America became the single most important financial institution helping BCCI stay afloat.

In the United States alone, Bank of America transferred more than $1 billion a day for BCCI until the moment of BCCI’s global seizure in July 1991.

Thus Bank of America acted as a sort of global vacuum cleaner, sucking up many BCCI branch deposits and thereby providing the fuel Abedi needed to keep his Ponzi scheme alive.”

Stock Market Manipulation & Money Laundering

Long before the Commodities Futures Trading Commission (CFTC) was covering-up wide-scale manipulation of the stock market during this economic crisis, they were working overtime to conceal BCCI money laundering and market manipulation. As the 1992 US Senate Report stated:

“In the entire BCCI affair, perhaps no entity is more mysterious and yet more central to BCCI’s collapse and criminality than Capcom, a London and Chicago based commodities futures firm which operated between 1984 and 1988. Capcom is vital to understanding BCCI because BCCI’s top management and most important Saudi shareholders were involved with the firm. Moreover, Capcom moved huge amounts of money — billions of dollars — which passed through the future’s markets in a largely anonymous fashion.

Capcom was created by the former head of BCCI’s Treasury Department, Ziauddin Ali Akbar, who capitalized it with funds from BCCI and BCCI customers…. Additionally, the company employed many of the same practices as BCCI, especially the use of nominees and front companies to disguise ownership and the movement of money. Four Americans, Larry Romrell, Robert Magness, Kerry Fox and Robert Powell — none of whom had any experience or expertise in the commodities markets — played important and varied roles as frontmen….

The commodities markets in the U.K. and the U.S. are not restricted, regulated or supervised as stringently as the banking industry or the securities markets.

Moreover, the commodities markets can sustain almost limitless volume, a necessary prerequisite for crime on the scale of that contemplated by BCCI since fraudulent transactions may be hidden in a multitude of legitimate ones. In a letter to the directors, the Chairman of Capcom, Larry Romrell, reported 165 million in trading during the first four months of operation, and profits of 883,393. That trend continued until 1988 leading Akbar to boast to agent Mazur: ‘We have contracted 165,000 contracts totaling $53 billion with Drexel Burnham,’ and later, ‘we have done over $90 billion total in 1988.’

While the number of contracts and dollar volume seems unbelievable, a commodities company can artificially create massive volume by many small or no-risk trading methods. Indeed, the volume generated by Capcom helped it to generate respectability and acceptance with reputable banks and brokers. For example, listed under ‘Auditors and Advisers’ in Capcom’s 1987 Annual Report were the following major international banks: Manufacturers Hanover Trust Company, London, National Westminster Bank Plc, Manufacturers Hanover Trust Company, New York, Deutsche Westminster Bank, A.G., and National Westminster Bank, plc. Elsewhere, Capcom noted its ties to Dean Witter Reynolds, American Express Bank, Refco, Prudential Bache Trading Corp., and Sumitomo Trust and Banking, Ltd.”

Also, long before the modern techniques of market manipulation and money laundering, like high frequency trading, round trip trading and quote stuffing, BCCI mastered a technique called “mirror image trading.”

The Senate report continued:

“Capcom and Money Laundering

There is evidence that Capcom engaged in money laundering for a variety of clients both in the United States and in London. For example, some 50 transactions were identified in the Futures, Inc. accounts with insufficient or no supporting documentation regarding the source or disposition of funds. These transactions totaled more than $125,000,000.

In testimony to the Subcommittee, Customs agent Robert Mazur testified how Akbar used ‘mirror-image’ trading to launder huge sums of money. Mirror image trading involves buying contracts for one account while selling an equal number from another account. Since both accounts are controlled by the same individual any profit or loss is effectively netted. According to Mazur, Akbar explained that because these ‘mirror image’ transactions can be lost among many millions of dollars worth of legitimate transactions ‘it would take forever for anyone to ever find it.’

Using mirror-image trading, Akbar bilked the BCCI Treasury accounts and laundered money for one of Capcom’s most notorious clients, General Manuel Antonio Noriega. Although complex, the series of transactions involving Noriega, BCCI and Capcom provide an illustration of textbook money laundering….

Conclusion….

In terms of the broader lessons of Capcom, regulation of the futures markets need to be greatly strengthened. Even a cursory background check on Akbar would have revealed that he had managed the Treasury accounts at BCCI which lost $400 million in the futures markets in the early eighties. Moreover, regulators who appeared before the Subcommittee testified on the one hand that annual audits of Capcom US turned up nothing irregular, but that Capcom’s books and records were a mess. That such a contradiction was allowed to continue for four years indicates that the CFTC needs to critically review the effectiveness of the various exchange audits. Finally, money laundering should be made a crime under the Commodities Futures Trading Act.”

VIII: The Savings and Loan Scandal

The Savings and Loan scandal was a significant part of the BCCI Affair. Looking back through piles of documents and research I’ve gathered, it is stunning how similar that crisis was to our current crisis. Both operations were put into motion as a result of the deregulation of key sectors of the financial system; in both of these cases the real estate sector was a main component. This is a clear pattern in financial intelligence operations. The first essential mission is to create legislation that allows for the creation of dark spaces, or “dark pools,” within key areas of the financial system where intelligence operations can then be executed without oversight or accountability.

To show you how history repeated itself, here’s an excerpt from the 1993 book, “Banking Scandals: The S&Ls and BCCI,” edited by Robert Emmet Long:

“The Savings and Loan debacle – the greatest scandal in the history of American banking – first came to national attention in the mid-1980’s. At that point, the failure of the thrifts, as S&Ls are sometimes known, appeared to be a controllable and containable situation. Both government officials and representatives of the Savings and Loan industry gave assurances that the S&L industry was still sound, and both worked to head off a full-scale investigation.… The delay in confronting the situation cost taxpayers billions of dollars. The price tag for bailing out the failed banks steadily escalated, from estimates of $50 billion at first to $500 billion and then $750 billion or even a staggering $1 trillion.…

The Savings and Loan scandal was unparalleled in the extent of its chicanery and in its ultimate cost to taxpayers, who will be paying for it for decades to come… In a series of steps beginning in 1980, the S&Ls were deregulated at the same time that the Federal Savings and Loan Insurance protection for depositors rose from $40,000 to $100,000. The combination stimulated get-rich-quick investments of a highly speculative nature on the part of bankers, who looted the treasuries of the institutions they were entrusted to protect.”

It was also George Bush Sr. who, then as Vice President, oversaw the “task force on deregulation and bank supervision” that led directly to the S&L crisis. In fact, his son, Neil Bush became known as the “poster boy” of the S&L crisis. Neil was nicknamed “the Silverado Kid” after he cost US taxpayers $1.3 billion while running Silverado Banking, Savings & Loan. In 1989, after becoming president, George Bush Sr. promptly bailed out the S&L industry, costing taxpayers hundreds of billions of dollars.

Many of the failed S&L thrifts served as secret intelligence shell companies and were traced back to BCCI and the CIA. In a study entitled, “Organized Crime, The CIA and the Savings and Loan Scandal,” Criminal Justice Professor Gary W. Potter explains:

“It is not our intent to discuss the unethical and even illegal business practices of the failed savings and loans and their governmental collaborators. The outlandish salaries paid by S & L executives to themselves, the subsidies to the thrifts from Congress which rewarded incompetence and fraud, the land ‘flips’ which resulted in real estate being sold back and forth in an endless ‘kiting’ scheme, and the political manipulation designed to delay the scandal until after the 1988 presidential elections are all immensely interesting and important. But they are subjects for others’ inquiries. Our interest is in the savings and loans as living, breathing organisms that fused criminal corporations, organized crime, and the CIA into a single entity that served the interests of the political and economic elite in America. Let us begin by quickly summarizing the most blatant examples of collaboration between financial institutions, the mob, and the intelligence community….

First National Bank of Maryland…
Palmer National Bank…
Indian Springs Bank…
Vision Banc Savings…
Hill Financial Savings…
Sunshine State Bank…

All told at least twenty-two of the failed S & L’s can be tied to joint money laundering ventures by the CIA and organized crime figures. If the savings and loan scandals of the 1980s reveal anything, they demonstrate what has often been stated as a maxim in organized crime research: that corruption linking government, business, and syndicates is the reality of the day-to-day organization of crime. Investigations of organized crime in the United States, Europe, and Asia have all uncovered organized crime networks operating with virtual immunity from law enforcement and prosecution.”

For further details on BCCI and CIA connections to the S&L crisis, let’s return to “Banking Scandals: The S&Ls and BCCI:”

“The banking scandals involving S&Ls and the rogue Bank of Credit and Commerce International (BCCI) are linked through David Paul, former CEO of CenTrust Savings Bank, a Miami S&L that was seized in February 1990. Like S&L kingpin Charles Keating, Paul knew that he could ingratiate himself with politicians by helping them raise campaign money. Political intervention by the likes of Keating Five senators Alan Cranston of California and Donald Reigle of Michigan helped keep CenTrust open for two years after it otherwise would have been closed. CenTrust’s involvement with BCCI was even greater than its interaction with S&L scoundrels. By mid 1988, CenTrust owed its survival to BCCI and one of the bank’s alleged front men, Ghaith Pharaon, who helped win approval of a CenTrust bond issue that brought new capital into CenTrust and improved the condition of its books just in time for the thrift to pass a crucial examination by regulators….

Sunbelt Savings, Western Savings, and State Savings have all been named by the Houston Post as members of a daisy chain of failed thrifts with links to organized crime and even, perhaps, to the CIA. All three have collapsed, at a cost to taxpayers of over $3 billion.”

Once again, George Bush Sr.’s role in BCCI and the S&L crisis cannot be understated. To recap, over the course of BCCI’s entire reign, Bush Sr. led the CIA, then served as Vice President before becoming President. He had extraordinarily close relations with Saudi Arabia, the most oil-rich nation in the world. Kahlam Adham was a top BCCI executive and head of Saudi Arabian intelligence, he was known as “the godfather of Middle East Intelligence” and was the CIA’s main liaison to the region. BCCI’s Chief Operations Officer was Khalid bin Mahfouz, who also led Saudi Arabia’s largest national bank and was a major player in the oil industry. Mahfouz was known as “the most powerful banker in the Middle East.” As already mentioned, Saudi Arabian intelligence was mixed in tightly with Wall Street banking interests in BCCI’s Capcom money laundering operations in the futures market. George Bush Sr. also did everything within his power to conceal these operations, as investigative reporter Chris Floyd wrote:

“When a few prosecutors finally began targeting BCCI’s operations in the late Eighties, President George Herbert Walker Bush boldly moved in with a federal probe directed by Justice Department investigator Robert Mueller. The U.S. Senate later found that the probe had been unaccountably ‘botched’–witnesses went missing, CIA records got ‘lost,’… Lower-ranking prosecutors told of heavy pressure from on high to ‘lay off.’ Most of the big BCCI players went unpunished or, like [Khalib bin] Mahfouz, got off with wrist-slap fines and sanctions. Mueller, of course, wound up as head of the FBI, appointed to the post in July 2001–by George W. Bush.”

Robert Mueller, who has been running the FBI since September 4, 2001, under Bush Jr. and now Obama, was Bush Sr.’s go-to guy at the Justice Department in covering up BCCI and S&L operations. Back in 1992, Beaty and Gwynne reported the following in Time magazine:

“In the U.S. investigators now say openly that the Justice Department has not only reined in its own probe of the bank but is also part of a concerted campaign to derail any full investigation. Says Robert Morgenthau, the Manhattan district attorney, who first launched his investigations into B.C.C.I. two years ago: ‘We have had no cooperation from the Justice Department since we first asked for records in March 1990. In fact they are impeding our investigation, and Justice Department representatives are asking witnesses not to cooperate with us.’”

In summation, George Bush Sr., Henry Kissinger, James Baker, Robert Mueller, Robert Gates and Alan Greenspan were all heavily involved in BCCI activities. Former President Bill Clinton even played a crucial role in continuing the cover-up by killing follow-up investigations upon taking office. More stunning than the BCCI operations and the cover-up, was that even after the BCCI Affair was finally exposed, all of these major players were not held accountable. The fact that people like this not only got to walk away, but remained in top positions of power for years after the scandal was exposed, with Robert Gates now serving as the Secretary of Defense and Robert Muller still serving as the head of the FBI, tells you all you need to know about the rule of law in the United States.

When you look back at the S&L crisis and understand how that scandal worked, you can clearly see how that operation served as a forerunner to, and evolved into, our current economic crisis. Of course this time it would happen under the presidency of George Bush Jr., and the cover-up would be maintained by a different Democratic President, Barack Obama.

IX: The Lessons of BCCI

While investigating BCCI operations, I began to clearly understand for the first time how the Global Banking Intelligence Complex runs both political parties in the United States. After years of researching and investigating BCCI, I’ve come to understand how power really operates, who the real power players are and how the mainstream media, which is tightly controlled by these forces, keeps the American public in the dark and marginalized by never reporting on the roots of power. The harsh truth is that American democracy and the rule of law are an illusion.

Above all, the BCCI scandal taught me two major lessons. First, when there is blatant criminal activity that goes unpunished, global banking intelligence interests are behind it. Second, you always have to follow the money. At the heart of power is the money supply, the ability to create, issue and manipulate global currencies. This is what the most powerful have always known. As the old House of Rothschild maxim goes, “Let us control the money of a nation, and we care not who makes its laws.”

When you peel back all the layers, the ultimate power in this world lies within the Global Banking Intelligence Complex, or the “money powers” as our Founding Fathers and early presidents called them. If you research our forefathers, you will see that they understood this point very well. The main theme throughout American history has always been the war between democracy and the concentration of power within the banks.

This may seem obvious to some, but this very obvious point has been omitted from mainstream media and public consciousness within the United States. This very viewpoint has been completely removed from the debate surrounding our current economic crisis and the failed financial reform process. And when it comes to the funding of perpetual wars, the banking interests behind the scenes are never even mentioned.

So this long winding road has led me right into the heart of our current crisis. It has been from this viewpoint that I have closely watched this crisis unfold. I’ve been following all these power players for years now and it’s given me an insider’s view and front row seat into our current political environment. Watching old BCCI players and their protégés continue to maintain positions as top US government officials over the years reveals a very different reality when you consider significant issues like 9/11; the Af-Pak and Iraq wars; the private military complex; the Israeli-Palestinian conflict; Pakistani, Iranian and North Korean nuclear weapons programs; global weapons sales; mainstream media propaganda campaigns; campaign finance laws; lobbying efforts; electronic voting machines; the current economic crisis, along with the bailout and stock market manipulation.

When I think about the “War on Terror” and the modern global banking system, the BCCI Affair is child’s play in comparison. The Global Banking Intelligence Complex is on steroids and stronger than ever, with power and wealth concentrated in unprecedented fashion.

Now that we have a fundamental understanding of how financial intelligence operations worked throughout the 1980s and early ’90s, now that we’ve scratched just below the surface, I will now expose operations throughout the late ’90s and past decade.

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States.

Editor’s Note: The following is Part I to David DeGraw’s new book, “The Road Through 2012: Revolution or World War III.” This is the second installment to a new seven-part series that we will be posting throughout the next few weeks. Read the introduction to the book here.

When we analyze our current crisis, focusing on the past few years of economic activity blinds us to the history and context that are vital to understanding the root cause. What we have been experiencing is not the result of an unforeseen economic crash that appeared out of the blue with the collapse of the housing market. It was certainly not brought on by people who bought homes they couldn’t afford. To frame this crisis around a debate on economic theory misses the point entirely. To even blame it on greedy bankers, while essentially accurate, also misses the most vital point.

This crisis is the direct result of a strategic economic attack on the existence of a middle class and democracy worldwide. The stock market and economy have become weapons of mass oppression manipulated by an imperial banking cartel to impose order and exploit the masses. This crisis boldly represents the manifest evolution of the fascist spirit reasserting itself as the dominant ideology.

Any fairytale notions of the United States being a democratic republic built on the rule of law have been utterly dispelled. As a nation we have been bred and conditioned to be dangerously naïve to the darker forces which operate beyond the spotlight of the mainstream media. We have been blinded to what has been developing throughout the world.

The economic imperialism that has now blown-back to the United States and Europe has been evolving for decades and can be directly traced back to the end of World War II, to the birth of the CIA, International Monetary Fund (IMF) and World Bank.

For those of us who have been paying attention to economic imperial operations that have been carried out against countries throughout the world, this looks all too familiar. The IMF and global bankers have conquered the second and third world, and they have now moved on to countries within the first world. Western European and American working classes are in the cross-hairs now.

Economic and societal indicators, along with recent G-20 policy decisions, clearly demonstrate that they are carrying out and escalating systemic economic attacks throughout Europe and the US.

To put it in technical terms, the United States government has been taken over by a financial terrorism network. They have bought off leaders of both the Republican and Democratic parties, and have established a dominant role in all three branches of government and throughout the mainstream media. They have complete control of the economy, stock market, US Treasury, Federal Reserve, World Bank, IMF and global banking system. Free market capitalism has collapsed; it’s now a rigged global market. This is an organized criminal operation, an imperial fascist movement that is determined to destroy our very way of life.

A war has already been launched against us.

In just the past three years we have lost an unprecedented amount of national wealth, trillions upon trillions of our tax dollars have been looted by Wall Street, endless wars, enormous subsidies for the most profitable global corporations and tax cuts for the richest one percent of the population. Never before, in the history of civilization, has a nation been so thoroughly and systematically fleeced.

This is all the result of a coordinated economic attack by a global banking cartel against 99 percent of the US population.

Until we can become politically intelligent enough to see this as the reality and root cause of our current crisis, we will not be able to overcome it, our living standards will continue to decline and we will all be sentenced to a slow death in a neo-feudal system built on debt slavery.

The average American is horribly naïve to just how depraved, corrupt and addicted to power this banking cartel is. Through their control and domination of the mass media, they have kept their crimes against humanity out of public consciousness. We have been shielded from the global devastation and death toll that they have already wrought. The result is an unsuspecting population of confused and passive people having their future ripped out from under them, right before their eyes, without any organized defense or resistance.

II: Violence on the Horizon

As the entrenched global banking cartel continues to control domestic political policy, the next phase of this crisis will inevitably feature an escalation into mass violence. As the Army War College stated, the Pentagon is preparing for “violent, strategic dislocation inside the United States” and “widespread civil violence” due to “purposeful domestic resistance.”

In clear signs of what is to come, rioting and violence as a result of economic turmoil has already been experienced in many countries throughout the world. However, civil unrest has not yet occurred within the United States. There are many theories as to why there has been so little resistance from the US population thus far, and several factors play into it. The most significant factor is that social safety net programs have been vital in preventing people from resorting to extreme measures. Currently, a stunning number of Americans, 52 million, are receiving life-sustaining assistance from government “anti-poverty” programs, such as food stamps, unemployment benefits, Medicaid and Medicare. This has already stretched a social safety net system that is designed to handle significantly less people to its limit. This safety net system has now been drained of all reserve resources over the past two years, and is obviously not sustainable under current economic and political conditions.

As social safety net programs have been drained of reserves, many US citizens have also been burning through their personal savings. Over the past few years the percentage of Americans living paycheck to paycheck has dramatically increased. In 2007, 43 percent of Americans were living paycheck to paycheck. In 2008, the percentage increased to 49 percent. In 2009, the number skyrocketed up to 61 percent. The most recent number for 2010 has exploded to a shocking 77 percent. This means in our nation of 310 million citizens, 239 million Americans are one setback away from economic ruin and millions more are in danger of having to rely on government assistance for survival.

So as this prolonged economic crisis continues, these safety nets, that are already overwhelmed, will have to support more and more people and will inevitably break down. As we have just begun to see, budget cuts to vital social programs on the state and federal levels will become increasingly severe right at the point when many more Americans will need them. As the 52 million Americans currently surviving in “anti-poverty” programs are gradually cutoff from life-sustaining government assistance – and as the 239 million people now living paycheck to paycheck, buried in debt, stressing out and working their asses off just to make ends meet realize that things are not going to be getting any better — and are only going to get worse — social unrest and outbursts of violence will eventually start to bubble up to the surface and the ruling elite will no longer be able to maintain power by simply deceiving the masses via mainstream media propaganda.

When an overwhelming majority of the population directly feels negative effects upon their own living standards, the propaganda system collapses. The illusion comes crashing down and people will finally start to get wise to the horrific scam that is being played on them. When they wake from their media-induced American dream state and realize that they are now living in a nightmare, as crazy as it may sound, people will actually stop voting against their own interests. The apathetic majority, that doesn’t vote, will become active in the interests of self-preservation as their survival instincts kick in.

The handwriting is on the wall and the ruling class has to realize that by the time 2012 rolls around, their puppet politicians will be voted out of office, or their heads will roll, quite literally.

Looking at this from a purely technocratic sociological viewpoint, avoiding mass riots and violence while this many desperate people lose life-sustaining programs appears to be an impossible task, and given our current economic and political environment this seems inevitable.

In an article titled “A Planet at the Brink: Will Economic Brushfires Prove Too Virulent to Contain?” Michael T. Klare explained:

“As people lose confidence in the ability of markets and governments to solve the global crisis, they are likely to erupt into violent protests or to assault others they deem responsible for their plight, including government officials, plant managers, landlords, immigrants, and ethnic minorities. (The list could, in the future, prove long and unnerving.) If the present economic disaster turns into what President Obama has referred to as a ‘lost decade,’ the result could be a global landscape filled with economically-fueled upheavals.”

Former National Security Adviser Zbigniew Brzezinski expressed  his fears:

“I was worrying about it because we’re going to have millions and millions of unemployed, people really facing dire straits. And we’re going to be having that for some period of time before things hopefully improve. And at the same time there is public awareness of this extraordinary wealth that was transferred to a few individuals at levels without historical precedent in America….

And you sort of say to yourself: what’s going to happen in this society when these people are without jobs, when their families hurt, when they lose their homes, and so forth?”

Outbreaks of civil unrest are something that the US government and Pentagon have been expecting, and preparing for. Former US Director of National Intelligence Dennis Blair testified before the Senate Intelligence Committee stating that the greatest threat facing the US is not terrorism, it’s the current economic crisis:

“The primary near-term security concern of the United States is the global economic crisis and its geopolitical implications. The crisis has been ongoing…. Of course, all of us recall the dramatic political consequences wrought by the economic turmoil of the 1920s and 1930s in Europe, the instability, and high levels of violent extremism.”

Intelligence Committee Vice-Chair Christopher Bond said the economic crisis is now “the primary focus of the intelligence community.” As the Army War College has warned, the response to this coming phase of the economic crisis “might include use of military force against hostile groups inside the United States. Further, DoD [the Department of Defense] would be, by necessity, an essential enabling hub for the continuity of political authority in a multi-state or nationwide civil conflict or disturbance.”

Journalist Chris Hedges summed up this report:

“The specter of social unrest was raised at the US Army War College in November in a monograph titled ‘Known Unknowns: Unconventional ‘Strategic Shocks’ in Defense Strategy Development.’ …

The ‘widespread civil violence,’ the document said, ‘would force the defense establishment to reorient priorities in extremis to defend basic domestic order and human security.’

‘An American government and defense establishment lulled into complacency by a long-secure domestic order would be forced to rapidly divest some or most external security commitments in order to address rapidly expanding human insecurity at home,’ it went on….

In plain English, something bureaucrats and the military seem incapable of employing, this translates into the imposition of martial law and a de facto government being run out of the Department of Defense. They are considering it. So should you.”

III: The IMF Riot, Step 3.5

The International Monetary Fund is predicting a “social explosion” due to this crisis. The IMF and World Bank have a long history of creating social upheaval. Leaked documents from within the World Bank refer to the next phase of the crisis as the “IMF riot.”

Journalist Greg Palast obtained classified planning documents, which shed light on the covert economic imperial operations, Structural Adjustment Programs, that the IMF, World Bank and US Treasury have used in the past as a playbook for destabilizing and conquering foreign nations. In the UK newspaper The Observer, Palast interviewed Nobel Prize-winning economist Joseph Stiglitz, who was a former World Bank Chief Economist and Senior Vice President, turned whistleblower. They revealed the four-step IMF plan. Though the strategy is slightly modified based on the nation being attacked, here in the United States we are currently about to enter a variation of step-three, which is currently being phased in throughout Europe. This step inevitably leads to a significant portion of the population losing the ability to obtain basic necessities essential for survival. Once this happens, riots inevitably occur, or as they put it: step 3.5 is executed.

Here is how Palast and Stiglitz summed it up:

“At this point, according to Stiglitz, the IMF drags the gasping nation to Step Three: market-based pricing – a fancy term for raising prices on food, water and… gas.

This leads, predictably, to Step-Three-and-a-Half: what Stiglitz calls ‘the IMF riot’.

The IMF riot is painfully predictable. When a nation is, ‘down and out, [the IMF] squeezes the last drop of blood out of them. They turn up the heat until, finally, the whole cauldron blows up,’…

What Stiglitz did not know is that Newsnight obtained several documents from inside the World Bank. In one, last year’s Interim Country Assistance Strategy for Ecuador, the Bank several times suggests – with cold accuracy – that the plans could be expected to spark ’social unrest’.”

To sum up, the interlocked IMF and World Bank set the conditions for ’social unrest’ and then once it occurs they move to step-four, which is the ultimate in disaster capitalism – they profit off the misery and the civilian population is then buried in a neo-feudal system of severe debt and poverty.

So what is the IMF saying right now about our situation in Europe and the US? A recent Telegraph report reads:

“IMF fears ’social explosion’ from world jobs crisis

America and Europe face the worst jobs crisis since the 1930s and risk ‘an explosion of social unrest’ unless they tread carefully, the International Monetary Fund has warned….

Olivier Blanchard, the IMF’s chief economist, said the percentage of workers laid off for long stints has been rising with each downturn for decades but the figures have surged this time. ‘Long-term unemployment is alarmingly high: in the US, half the unemployed have been out of work for over six months, something we have not seen since the Great Depression,” he said….

The IMF said there may be a link between rising inequality within Western economies and deflating demand. Historians say the last time that the wealth gap reached such skewed extremes was in 1928-1929…”

To show you how insidious the IMF is, they have recently launched a propaganda campaign to publicly decry deficit budget cuts and austerity measures. However, behind the scenes they have been forcing implementation of them and making their usual demands for cuts in vital social services and public spending, once those cuts are in place, the riots obviously follow.

A recent Washington Post report states:

“IMF issues broad call for US financial prudence
Cut Social Security. Ditch the deduction for interest on home mortgages. Tax gasoline.
The United States recently opened itself to the most intense scrutiny yet by the International Monetary Fund, and on Thursday was offered a bitter pill when the agency criticized some well-defended aspects of American culture — cheap fuel, subsidized housing, and a government retirement check…. “

Economist Dean Baker writes:

“The central bankers and their accomplices at the IMF are dictating policies to democratically elected governments. Their agenda seems to be the same everywhere, cut back retirement benefits, reduce public support for health care, weaken unions and make ordinary workers take pay cuts.”

In another report Baker adds:

“The IMF program calls for cutbacks in government support for healthcare, pensions, and a wide range of other public services. It also calls for weakening labor market regulations that provide workers with job security.

These recommendations are being given in a context where the world economy is suffering from a massive shortfall of demand. In other words, tens of millions of people are unemployed right now because there is not enough spending to keep them employed. The IMF’s program is almost certain to reduce spending further leading to even larger shortfalls in demand and more unemployment….

The IMF’s track record gives us reason not only to question the institution’s competence but also its motivations…. It is possible to see a similar pattern in the IMF’s latest set of policy recommendations to deal with the economic crisis.”

In an article entitled, “The Attack of the Real Black Helicopter Gang: The IMF Is Coming for Your Social Security,” Baker continues:

“Last week, the IMF told the United States that it needs to start getting its budget deficit down. It put cutting Social Security at the top of the steps that the country should take to achieve deficit reduction. This one is more than a bit outrageous for two reasons…

While the IMF has no problem warning about retired workers getting too much in Social Security benefits, it apparently could not find its voice when the issue was the junk securities from Goldman Sachs or Citigroup that helped to fuel the housing bubble.

The collapse of this bubble has not only sank the world economy, it also destroyed most of the savings of the near retirees for whom the IMF wants to cut Social Security. The vast majority of middle-income retirees have most of their wealth in their home equity. This home equity largely disappeared when the bubble burst.”

So the IMF and global banking cartel are setting the conditions for social unrest and pushing for policies that will provoke it, and the Pentagon is preparing for a military response. As scary and unbelievable as all this may sound, we are on a fast track to this scenario.

To Sum Up

The American and global economy have already been looted and destroyed beyond repair. Most serious economists will admit that governments have already exhausted their capital by bailing out the banks and taking on unprecedented amounts of debt. The bailouts and recent return to high profits were just the final phase of the looting and a further consolidation of wealth on an unprecedented scale. There are still tens of trillions of dollars in debt hidden off-the-books and hundreds of trillions of dollars in dark pools of derivative liability. As the downturn continues, there is nothing left to revive the economy, the reserves and safety nets have already been stretched to their limits.

We have a political and economic system that has been overrun by organized corruption and theft. Along with a mass media system that does not inform the populace and has effectively marginalized and isolated the majority of the population. Meanwhile, bubbling just under the surface is a very heavily armed population with a militia movement that has doubled in size over the past year, and their memberships continue to rapidly grow. Without the necessary general political intelligence or infrastructure to organize an effective mass non-violent movement, we are steamrolling toward spontaneous riots and outbursts of armed insurrection.

In other words, as this economic downturn continues, what is now a passive and confused population will eventually devolve into an explosion of violence. Without a coherent non-violent movement to provide a viable alternative, without an outlet for severe and legitimate grievances that provides any chance for urgently affecting necessary political change, people will resort to violence as a last desperate act of vengeance and frustration. As time passes, these forgotten and isolated people, tens of millions of them, are quickly running out of options, and they will act out just as exploited people throughout the world always have.

A man who sparked a revolution against the same banking cartel that has caused our crisis described the general attitude among a population that successfully rebelled through armed insurrection:

“The people are weary of being oppressed, persecuted, exploited to the maximum. They are weary of the wretched selling of their labor-power day after day — faced with the fear of joining the enormous mass of unemployed — so that the greatest profit can be wrung from each human body, profit later squandered in the orgies of the masters of capital….

The feeling of revolt will grow stronger every day among the peoples subjected to various degrees of exploitation, and they will take up arms to gain by force the rights which reason alone has not won them.”

Whatever your preconceptions of the man who said this may be, the voice of Che Guevara can now be clearly understood and related to by the overwhelming majority of people throughout the United States.

Already, despite intensive propaganda, a stunning 80 percent of the US population believes that the government has failed them. The health care and financial reform bills have proven that our politicians are much more concerned about the short-sighted necessity to please the Economic Elite and raise campaign funds, than they are to understand the consequences of millions of Americans being forced into situations where their very survival is threatened. In a system where most elected officials are millionaires, this lack of perspective and understanding is ultimately what will lead to violence. Whether it is by arrogance or ignorance, perhaps both, it appears that our ruling class has suicidal tendencies. Unless they quickly recognize the growing threat posed by the dispossessed masses, our puppet politicians will themselves be in harm’s way.

To show you how incredibly out of touch our current elected officials are, and to give you a clear indication of the prevailing attitude on Capitol Hill, a recent report from the Washington Post summed up their response to the recent news that a record number of Americans are now living in poverty:

“The reluctance of political leaders on both sides of the aisle to directly confront the fact that growing numbers of Americans are slipping into poverty reflects a stubborn reality about the poor: They are not much of a political constituency.

‘We talk to many people on Capitol Hill who do believe poverty is important and is a blight on our nation, but we are also up against a general recognition that poor people don’t vote in great numbers. And they certainly aren’t going to be making campaign contributions. That definitely puts them behind many other people and interests when decisions are being made around here.’”

And that sums up our current crisis, doesn’t it? The “poor people don’t vote” and they don’t make “campaign contributions.”

As the Rage Against the Machine song goes, “The riot be the rhyme of the unheard.”

IV: Bang the Drums of War

How will this imperial fascist banking cartel respond to revolt? How will they maintain their power over an increasingly radicalized and hostile US population?

In an attempt to stave off organized rebellion, they are already escalating their propaganda efforts in attempts to divide and distract the population. The tactics of their divide and conquer strategy are already on full display. Their mainstream media outlets have drastically increased coverage and focused attention on the rhetoric of division – using divisive issues like immigration, racism, religious bigotry, the “lazy unemployed,” “entitlement welfare” and gay marriage to divide and distract the population and prevent the masses from organizing against their true oppressors.

This propaganda effort is only a temporary measure and will not suffice over the long-term. As the economy continues to collapse, the banking elite risk being overthrown as a result of their own greed. So they will then turn to physical, military-based violence to suppress populations that can no longer be controlled through propaganda and economic coercion.

To paraphrase policy analyst Anatol Lieven, the classic strategy of an endangered oligarchy is to divert discontent among the population into nationalistic militarism. It is time, once again, to bang the drums of war and “whip the citizenry into a patriotic fervor.” The source of the following quote is unknown, but the evident wisdom of it is something that we have already experienced firsthand in the recent past:

“Beware the leader who bangs the drum of war in order to whip the citizenry into a patriotic fervor, for patriotism is indeed a double-edged sword. It both emboldens the blood, just as it narrows the mind. And when the drums of war have reached a fever pitch and the blood boils with hate and the mind has closed, the leader will have no need in seizing the rights of citizenry. Rather, the citizenry, infused with fear and blinded by patriotism, will offer up all of their rights unto the leader and gladly so.”

An increased external threat will lead to an increased internal crackdown, which creates the pretext and conditions for a police state. As we have already seen in the first phase of the crackdown on civil liberties since the “War on Terror” began, when rioting and outbursts of armed insurrection begin within the US, external threats, real or imagined, will again be presented to justify extreme measures to suppress American citizens, and to further repress and divert internal dissent. Without an external enemy to rally the population against, the population will rally against the pre-existing internal powers.

To put a slight twist on what Guy DeBord insightfully said back in 1988: the banking cartel “constructs its own inconceivable foe, terrorism. Its wish is to be judged by its enemies rather than by its results. The story of terrorism is written by the state and it is therefore highly instructive. But they must always know enough to convince them that, compared with terrorism, everything else must be acceptable, or in any case more rational and democratic.”

V:The Chinese Scapegoat: Trade & Currency Wars

As millions of Americans and the majority of the global population look for vengeance on those responsible for severely declining living standards, the global banking cartel are not going to blame themselves, so they will deflect blame to China, a most convenient target.

As a result of the crisis, national currencies are reeling, and the dollar, although currently one of the strongest paper currencies, is losing power as the crisis escalates. The IMF is working to replace the dollar as the world reserve currency and have begun discussing the possibility of making their Special Drawing Rights (SDRs) the new world reserve currency. A plummeting dollar will obviously put the American population in a severely desperate situation and the US-based banking cartel needs an excuse to divert political backlash. In China, the nation poised to replace the US as the preeminent global superpower, they have the perfect scapegoat.

US-based global corporations have been shifting their business to China and off-shoring millions of jobs to the region due to their extremely low worker wages. So the American population is already pre-disposed to blaming China, as opposed to the companies who are exploiting the cheap labor. US politicians have been conveniently shifting blame for unemployment from themselves to China. Meanwhile, China also owns a significant portion of US national debt. US Admiral Mike Mullen, the Chairman of the Joint Chiefs of Staff, has recently declared that the national debt is the number one security threat. As Mullen stated, “Tax payers will be paying around $600 billion in interest on the national debt by 2012.” A significant portion of this interest will be going to China.

As national governments attempt to survive in an increasingly hostile global economy, trade and currency wars will flare up and escalate. China is in perhaps the strongest position to win these conflicts. China and Japan have just engaged in a fierce currency battle. This currency battle is not to be underestimated. We are talking about the world’s second and third largest economies, after the United States. China has just overtaken Japan for the number two position. The militant rhetoric between these two nations is escalating. US politicians were quick to jump on the situation with calls to classify China as a “currency manipulator” and impose trade tariffs and penalties against them.

International economic reporter Barry Grey recently summed up the situation in an article entitled, “Economic crisis threatens to unleash global currency wars:”

“The eruption of currency exchange conflicts is bound up with mounting signs that the global economic crisis is systemic, rather than merely conjunctural, and growing fears that a genuine recovery is not in the offing. The European sovereign debt crisis and the weakening of US economic growth have led governments around the world to seek to secure a greater share of export markets. Under conditions of slowing growth and stagnant markets, this inevitably heightens trade conflicts between competing capitalist nations.

In particular, the US and the European Union, spearheaded by the export power Germany, have aggressively pursued a cheap currency policy in order to gain a trade advantage against their rivals. Of the major economic powers, Japan has suffered the greatest damage from these policies, as investors and speculators have shifted from dollar- and euro-denominated investments to the yen, driving up the currency’s exchange rate.

This has embittered relations between Japan and both the US and the EU. Japan has also denounced China for artificially keeping its currency low while bidding up the yen by increasing its purchases of Japanese government securities.”

The global banking cartel’s leading puppets on Capitol Hill, Senators Chris Dodd, Chuck Schumer and Richard Shelby were all quick to attack China. Barry Grey continued:

“In opening the Senate Banking Committee hearing, Chairman Christopher Dodd declared China a currency manipulator and said its ‘economic and trade policies’ present ‘roadblocks to our recovery.’ He went on to accuse China of stealing intellectual property, violating international trade agreements and dumping goods. He also denounced China for acquiring national resources in developing countries and building up its military.

In his opening statement, the ranking Republican on the committee, Richard Shelby of Alabama, declared, ‘There is no question that China manipulates its currency in order to subsidize Chinese exports. The only question is: Why is the administration protecting China by refusing to designate it as a currency manipulator?’

Senator Charles Schumer, a New York Democrat, said, ‘China’s currency manipulation is like a boot on the throat of our recovery and this administration refuses to try to get China to remove that boot.’”

On top of all this, China has now overtaken the US as the world’s top energy consumer. Michael T. Klare reports on China’s new position of power:

“The main point: by becoming the world’s leading energy consumer, China will also become an ever more dominant international actor and so set the pace in shaping our global future.

Because energy is tied to so many aspects of the global economy, and because doubts are growing about the future availability of oil and other vital fuels, the decisions China makes regarding its energy portfolio will have far-reaching consequences. As the leading player in the global energy market, China will significantly determine not only the prices we will be paying for critical fuels but also the type of energy systems we will come to rely on. More importantly, China’s decisions on energy preferences will largely determine whether China and the United States can avoid becoming embroiled in a global struggle over imported oil and whether the world will escape catastrophic climate change.”

China’s rise in power, mixed with the decline of western economies and the need for an external scapegoat sets up a global collision and inevitable confrontation between vying superpowers. Currency and trade wars will likely be a prelude to military confrontation.

VI: Moves Upon the Grand Chessboard

Based on early maneuvering it is evident that the masters of war have already drawn up sides. You may have missed it, but the US, Israel and the NATO Alliance have already put Iran, Lebanon, Syria, North Korea, Venezuela, Russia and China on notice. And the “withdrawals” from Iraq and the Af-Pak region are over-hyped. The occupation of these countries continues with no end in sight. In fact, they aren’t withdrawing as much as they are repositioning and shifting their forces, preparing for an escalation. In many ways the wars in Iraq and Af-Pak have only been the initial phase of a global attack, positioning forces and building massive military bases in pivotal geo-strategic locations. The operations in this region have essentially been a warm-up for much wider-ranging attacks against much stronger countries. While most of the US population is playing checkers, seeing the wars in Iraq and Afghanistan as one-off battles, the global banking cartel is playing chess, using these wars as only initial geo-strategic moves in a grand strategy toward total world domination.

The intensity of military maneuvering presently occurring is alarming. Read through these recent news reports pulled from the AmpedStatus database, all from just the past few weeks, and let me know if you think I’m being extreme in foreseeing World War III:

US to Fund Israeli Purchase of 20 F-35 Joint Strike Fighters

US Waging ‘Shadow War’ in Dozen Countries

S.Korea, US to stage massive joint war games

US Military Offensive Against the July 2011 Af-Pak Timetable

China PLA warns U.S. over fresh military drill in region

The dangers of mounting US-China rivalry

America’s Biggest Jobs Program — the U.S. Military

US Arms ‘Bonanza’ in the Middle East

Chinese Military: The Chinese People Won’t Stand for US Provocation

Israel bulldozes Muslim graves in Jerusalem

U.S. Supersizes Afghan Mega-Base

US concerned other countries won’t respect Iraq’s ‘sovereignty’

US cuts $100m aid to Lebanon military

U.S. won’t leave Iraq’s energy reserves untended

US plans to sell F-15 jets to Saudi Arabia: report

Blackwater: $220 million in new contracts

Congress Spends Another $600 Million for Border Militarization

U.S. worried by Hamid Karzai’s attempt to assert control over corruption probes

Palestinians Denied Access to Water

Gates: Iraq occupation could go on

Petraeus beats the drums for endless war in Afghanistan

Israel-US Increase Military Cooperation, Hold Biggest Joint Infantry Exercise Ever

US, South Korea to Stage Another Military Exercise

The Philippines: America’s New Launchpad for the Militarization of Southeast Asia

U.S. and UK help train Kazakh troops in Russia’s backyard

India to order large number of Javelin anti-tank missiles from US

More US-NATO Military Bases: US Armed Forces in Central Asia

US, Vietnam step up defence co-operation amid China concerns

Speculation, debate over possible strike against Iran

Russian Foreign Minister defends Iran nuclear power plant

Colombia Court Blocks U.S. Military Accord Behind Regional Fight, Restricts Access to 7 Military Bases

Venezuela says it will still send gasoline to Iran

Venezuela threatens oil cut to US

Iran: Venezuela Risks US Action

Chávez and China: Challenging U.S. Interests | AEI

Canada-Russia airspace ’showdown’ over Arctic

Canada intercepted two Russian bombers near Arctic

Japan, US plan naval drill near disputed islets: report

China Restricts Exports of Rare Earth Minerals by 70pc,Tension with US escalating on several fronts

Moscow warns US on issue of Israeli aerial strikes against Iran

U.S. Global Strategy Targets Any Potential Challenger In Eurasia

Obama Signs $600M Bill to Increase Militarization of US-Mexico Border

Castro Warns of Nuclear War; Admiral Mullen Threatens Iran; US-Israel Vs. Iran-Hezbollah

Doesn’t Appear Washington Wants Diplomatic Relations With Venezuela

US talks Israel out of attacking Iran (for now)

US stresses military role in Iraq, combat brigades under different name

US Withdrawal Plan Marks “Privatization of Military Occupation”

U.S. Military Intervention in Africa: The New Blueprint for Global Domination

Ahmadinejad vows global response if Iran attacked

Iran Opens Its First Nuclear Power Plant With Russian Help

In Mideast Talks, Scant Hopes From the Beginning

Iran hopes Russia’s next step will be delivery of S-300 missiles system: MP

Iran working against Iraqi democracy: US general

US combat brigades still in Iraq: report

Karzai Stands Firm on Disbanding Private Security

Iran’s new drone bomber is ‘messenger of death for the enemies of humanity’

Costa Rica: US Warships Cause Unease

Israel Knesset Member Declares “We Are Preparing For War”

Pakistanis Nabbed Taliban Boss to Stop Peace Talks

Iran condemns possible US military action

Iran Calls for Formation of Islamic Union to Start New World Order

Four Israeli air strikes on Gaza

Two Minutes to Midnight? The Bomb-Iran Debate From Hell

The last chance to avoid a global trade war

Al-Shabab vows ‘massive’ Somali war

We Must Be Ready for War With China

Mass Assassinations Lie at the Heart of America’s Military Strategy in the Muslim World

US deplores ‘particularly outrageous’ Mogadishu carnage

Philippines: Pawn In U.S. Encirclement of China

Global Food Security and Sovereignty Threatened by “Land Grabs” in Poor Countries

US to spend $1.3 billion on Afghanistan bases

America’s top Marine challenges Obama’s Afghan pullout deadline

CIA sees increased threat from al-Qaeda in Yemen

U.S. Weighs Expanded Strikes in Yemen

JSOC is Hiring Interrogators and Covert Operatives for ‘Special Access Programs’

Report: Kim Jong-Il Goes to China

Canada Intercepts Russian Bombers — Again

Kim Jong-il Visits China as Carter Waits in North Korea for Talks on Imprisoned American

China Slams Pentagon Report

Mexico Drug War Violence Rages, 28k Killed

Tensions emerge between Rwanda and Western backers, China’s influence grows

“Alarm bells” ring for Australian government over deepening China-East Timor ties

US lawmaker urges France not to arm Lebanon army

Chairman Of Joint Chiefs Of Staff Says National Debt Is Biggest Threat To National Security

18 nations wrap up mock terror exercise in Panama canal

U.S. Bid To Control Whole Korean Peninsula Threat To China, Russia

Canada Opens Arctic To NATO, Plans Massive Weapons Buildup

China announces navy drill ahead of U.S. show of force

Putin slams West for deceiving Russia

Putin: U.S. Rearming Georgia

Israel preparing to attack Syria: report

China Deploys Troops In Pakistani Kashmir

Israel Threatens War with Lebanon

U.S. expands sanctions on North Korea

Hamas targets Israeli-Palestinian talks by killing four Israelis

US drones will patrol entire southern border

Yellow Sea: U.S. Aegis Destroyers, S. Korean Subs In New Round of Drills

Pentagon report underscores rising US-China tensions

CIA Training Intelligence Agents For ‘State Sponsor Of Terrorism’ Sudan

Tony Blair: military intervention in rogue regimes ‘more necessary than ever’

France steps up military intervention in Sahel, Western Africa

German military report: Peak oil could lead to collapse of democracy

U.S.-Venezuela Links Teeter on the Brink

Pakistan’s Taliban threaten attacks in U.S., Europe

EU austerity policies risk civil war in Greece, warns top German economist

India to acquire advanced U.S.-made anti-ship missiles

Middle East Loses Trillions As U.S. Strikes Record Arms Deals

Is War About to Break Out on the Israeli-Lebanese Border?

NATO asks for 2000 more troops for Afghanistan

US ‘likely’ to keep troops in Iraq after 2011

U.S. Military Continues to Invest Hundreds of Millions in Iraq Bases

UN nuke agency warns monitoring of Iran hampered

Mideast talks a cover for US war preparations

Land grabs, biofuel demand raise global food-security risk

Anthrax War – the Malaysian Connection

Defense Contractor Money Fueling Push to Militarize the US-Mexico Border

US Government Report Argues for Police Force for American Interventions Overseas

730 F-35 planes to be sold to Britain, Italy, Netherlands, Turkey, Canada, Australia, Denmark, Norway

U.S. to wrap up $2.5 billion Israel F-35 deal, Japan deal next

Cheney’s Oily Dream – Redrawing the Map of the Middle East

US and China at odds over North Korea

Pentagon says USS George Washington to join military drills off Korean Peninsula

Clinton: Mexico drug war bordering on ‘insurgency’

Land Grabs in Poor Countries Set to Increase

India: troops on alert as border dispute with China heats up

India: U.S. Completes Global Military Structure

Report: US must deal with domestic radical problem

Experts: Terrorism threat to U.S. now more homegrown

New York Times Pushes Confrontation with Iran

Largest US arms deal ever: Congress to be told of $60-billion US-Saudi arms deal, shoring up Arab allies against Iran

China-South Africa deals highlight great-power rivalry in Africa

German armed forces “reform” reflects growth of militarism

IMF fears ’social explosion’ from world jobs crisis

US embassy in Jordan warns of ‘imminent threat’ around Aqaba

Record level of US airstrikes hit Afghan militants

Hamas: Israeli aircraft strike Gaza as leaders talk peace

Obama’s Generals Push War for Yemen

US drones prowl Mexico

China’s currency manipulation: Flipping off America

Asia: Pentagon Revives And Expands Cold War Military Blocs

U.S. And NATO Strengthen Positions Along Russia’s Southern Flank

Russia vs Canada: Race for Oil-Rich Arctic Seabed

Economic crisis threatens to unleash global currency wars

Saudi king meets top US, Canadian counter-terror officials

China, Energy, and Global Power

Somalia, The Next Afghanistan? UN’s top envoy warns on growing insurgency

Pentagon to funnel US arms to Yemen

China-Japan Tensions Escalate, As China Breaks Off High Level Contacts, Japanese Flag Burned In Protest

Gulf States Order $123 Billion of U.S. Weaponry to Counter Iran

Massive US Military Buildup Planned for Guam

So there we have it. The global Economic Elite have effectively looted and destroyed national economies worldwide, the propaganda system is quickly collapsing, and the masses are beginning to get restless. It’s time to move to the next phase of the attack. Preparations are already underway. We are on the road to World War III.

VII: Resource Wars

Add to this picture rapidly declining natural resources and an increasingly hostile and polluted environment with extreme weather events frequently pounding the globe. In the past decade the global corporate elite have already engaged in three major resource wars in Iraq, Af-Pak and Northern Africa.

With a growing global population and an increasing demand for declining resources, we have already crossed a tipping point and are now in the ecological red. For the first time in human history, we are now consuming resources faster than nature can produce them. As developing countries like China and India attempt to live like western countries, there are simply not enough resources. The global economy is built on an unsustainable foundation. Instead of evolving and changing course, the entrenched banking power base is digging in further, and they run NATO, the private military complex and the US government. Based on the current policies that are in place, they have clearly already decided that they want to keep living business as usual and refuse to evolve and adapt to a rapidly changing environment. With this decision, they have effectively already decided to further escalate their oppression of the overwhelming majority of humanity, and this will lead to the death of literally hundreds of millions of people.

The global banking cartel view the world’s limited resources as their property, and they have consistently proven that they have absolutely no hesitation in killing millions upon millions of people for these resources – just look at what they have already done in the recent past throughout Northern Africa, the Middle East and Latin America.

In the years since Northern Africa was discovered to be “the richest patch of earth” due to large deposits of natural minerals that are needed to power computer technologies, over five million Africans, in just that region, have died as a result of war.

The global elite have consistently used a strategy of arming and funding both sides of armed conflicts. While opposing populations kill each other off, they make off with their natural resources. When they confront a government that cannot be bribed or provoked into civil or regional war, they fund brutal death squads, attempt military coups and intimidate them by giving weapons to undemocratic neighboring regimes. If all that doesn’t work, they are declared a threat to national security and the US military, private contractors and NATO forces invade and occupy the country.

These terrorist strategies are not limited to the Middle East and Africa, just ask our neighbors throughout Latin America about the School of the Americas. Contrary to popular belief, the horrendous torture techniques inflicted upon people in Abu Ghraib, Iraq were not an isolated incident. Many of those brutal torture techniques were developed over years by torturing innocent civilians throughout Latin America.

The picture in Latin America today is one of inspiration. People throughout the region are rising up against the global corporate elite and claiming their rights and natural resources as their own, from Bolivia to Ecuador to Venezuela. This is another factor driving the “endangered oligarchy” into resorting to military desperation. The military coup in Honduras, the attempted coup in Venezuela, and the failed attempt to provoke Columbia and Venezuela into an armed conflict all clearly indicate where this situation is headed if the imperialist bankers get their way.

The average American is dreadfully unaware of just how depraved these people are. The little regard they have for human life is beyond common comprehension.

VIII: Private Military Complex

The global elite have already used the “War on Terror” as a pretext to drastically increase military spending and build a massive private military and intelligence complex on the backs of the American taxpayer. According to an extensive report from the Washington Post, a stunning 1.2 million private contractors work in this complex. Most Americans are not aware that 69 percent of the soldiers deployed in our name are private contractors, and 80 percent of them are foreign nationals, meaning they are not even from the United States. Half of the people we have deployed in our name, who are funded by our tax dollars, are not even fighting for our country, they are fighting for a paycheck.

Wars are a highly profitable racket, which gives an enormous incentive to keep them going. This is one of the reasons why the war in Afghanistan is now the longest war in US history. This system has led to a perpetual state of war. Military spending, although widely reported as being around $680 billion per year, is more accurately totaling over $1 Trillion per year. Of this staggering amount of annual spending, 25 percent of it goes unaccounted for, not counting the billions of our tax dollars lost to over-charging and all-out fraud.

This private military complex has become so out of control that politicians are now forced to admit that they have no idea what is happening within it. As the Washington Post report revealed:

“The top-secret world the government created in response to the terrorist attacks of Sept. 11, 2001, has become so large, so unwieldy and so secretive that no one knows how much money it costs, how many people it employs, how many programs exist within it or exactly how many agencies do the same work.

These are some of the findings of a two-year investigation by The Washington Post that discovered what amounts to an alternative geography of the United States, a Top Secret America hidden from public view and lacking in thorough oversight. After nine years of unprecedented spending and growth, the result is that the system put in place to keep the United States safe is so massive that its effectiveness is impossible to determine.

The investigation’s other findings include:

* Some 1,271 government organizations and 1,931 private companies work on programs related to counterterrorism, homeland security and intelligence in about 10,000 locations across the United States.

* An estimated 854,000 people, nearly 1.5 times as many people as live in Washington, D.C., hold top-secret security clearances.”

There are so many unaccountable cells and competing factions within this complex, any one of them could go rogue and launch an attack on the US soil and make it look like another “terrorist” organization or nation executed it. This may sound too conspiratorial to the casual observer, but it would be stunningly naïve to think that in a massive complex like this, with so little oversight and accountability, given the huge sums of money at stake, that something tragic wouldn’t eventually occur. The implications are ominous, to say the least.

We already had a proven act of internal domestic terror occur with the Anthrax attacks in 2001. It is not a stretch to think that any moves away from a state of permanent war, and any cut to military spending that would threaten the existence of many of the world’s largest and most powerful and profitable corporations, would result in an attack in hopes of inciting a military conflict. Former President Dwight Eisenhower’s warning against the “unwarranted influence” of the military industrial complex, and “the potential for the disastrous rise of misplaced power” pales in comparison to the modern private military complex. While many of these companies currently rely on US tax dollars, they are not part of the government, they are global private entities with their own interests at heart, similar to the Federal Reserve banking system. In fact, when you peel back the layers, many of these private military companies are funded by the global banking cartel.

When you understand the forces behind war, you must acknowledge the words of famed two-time Congressional Medal of Honor recipient US Brigadier General Smedley D. Butler. He accurately summed up the situation when he said:

“I spent 33 years in the Marines, most of my time being a high-class muscle man for big business, for Wall Street and the bankers. In short, I was a racketeer for Capitalism…. The general public shoulders the bill. This bill renders a horrible accounting. Newly placed gravestones, Mangled bodies. Shattered minds. Broken hearts and homes. Economic instability. Back-breaking taxation for generations and generations.”

To give just two brief examples of how the banking cartel operates behind the scenes during wars, consider the following. The genocidal carnage in Northern Africa that killed over 5.4 million people was enthusiastically supported by the IMF and World Bank. In a news report entitled, “The Business of War in the Democratic Republic of Congo,” Dena Montague and Frida Berrigan explained:

“The International Monetary Fund (IMF) and World Bank have knowingly contributed to the war effort. The international lending institutions praised both Rwanda and Uganda for increasing their gross domestic product (GDP), which resulted from the illegal mining of DRC resources. Although the IMF and World Bank were aware that the rise in GDP coincided with the DRC war… they nonetheless touted both nations as economic success stories….”

In another example of grotesque profiting off massive levels of death, banking cartel members made a fortune on the production of cluster bombs. The Guardian revealed the details:

“The deadly trade in cluster bombs is funded by the world’s biggest banks who have loaned or arranged finance worth $20bn to firms producing the controversial weapons, despite growing international efforts to ban them.

HSBC… has profited more than any other institution from companies that manufacture cluster bombs. The British bank… has earned a total of £657.3m in fees arranging bonds and share offerings for Textron, which makes cluster munitions…. Campaigners maintain the deadly weapons can explode years after combat, killing or maiming innocent people….

Goldman Sachs, Bank of America, JP Morgan and UK-based Barclays Bank are also named among the worst banks [funding the production of cluster bombs]….

Goldman Sachs, the US bank which made £3.19bn proft in just three months, earned $588.82m for bank services and lent $250m to [cluster bomb manufactures] Alliant Techsystems and Textron.”

To sum all of this up, the global banking cartel and private military complex are a runaway virus that demands a permanent state of warfare. They are intrinsically parasitic in nature, they have devolved into a fascist enterprise that survives and profits off of destruction. If they don’t get a war, they will create one in the interest of their own self preservation. As former CIA Station Chief John Stockwell once explained: “Enemies are necessary for the wheels of the US military machine to turn.” This insight can now be extended to the global banking cartel. Enemies are now necessary for the wheels of the global banking cartel to turn.

Under the cover of the “War on Terror” they have launched a massive campaign of violence abroad and have been systematically looting our economy and stripping of us civil liberties at home.

So as the US and global population becomes more radical, and as the environment becomes more hostile, with increasingly limited natural resources, in a desperate attempt to maintain power the global banking cartel will escalate from economic attacks to worldwide military-based assaults. This is the clear path we are on – the road to World War III.

IX: History Repeats Itself

“History Repeats Itself, Coiling Down Into the Future.”
– Natural Born Killers

This may very well be a case of history repeating itself. Not to oversimplify an extremely complex situation, but this is all too similar to the origins of World War II. The looting of the masses by an unaccountable Wall Street elite led to the Great Depression and set the conditions for WWII. Desperate and impoverished populations increasingly supported more and more extreme leaders. The conditions are now so ripe for world war that Noam Chomsky has convincingly compared modern-day America to Weimar Germany prior to the outbreak of WWII. Research the history of pre-war societies and you will see for yourself how our current political environment fits historical precedent like a glove.

As mentioned before, the roots of our current crisis can be directly traced back to the aftermath of World War II. In the ruins of WWII grew global institutions like the IMF and World Bank. It also gave us the National Security Act and the CIA. All were central and pivotal in creating the crisis which we are now confronted with.

After analyzing our current crisis and studying well-established historical precedents, one must conclude that creating a world war is the last card the global bankers have left to play, other than conceding power, and history has taught us that the ruling class never concedes power. Of course the one-tenth of one percent of the global population hoarding our wealth could give back a significant amount of the $39 Trillion they looted from us (not counting what they have hidden in offshore accounts). That would certainly go a long way to fixing the crisis they have caused, but again, the ruling class has never conceded power, no matter how excessive and ill-gotten their gains.

So brace yourself… unless we significantly change our present course, we are on the road to World War III.

David DeGraw, a regular contributor to The Public Record, is an investigative journalist whose work has been featured in numerous publications and websites. He is the founder and editor of AmpedStatus.com, editorial director of MediaChannel.org and author of The Economic Elite Vs. The People of the United States.

I have read many reports that simply restate what the government has said without questioning the fact that the metrics they use to calculate poverty are extremely outdated.

News reports are out saying that in 2009 the poverty rate “skyrocketed” to 43.6 million – up from 39.8 million in 2008, which is the largest year-to-year increase, and the highest number since statistics have been recorded – putting the poverty rate for 2009 at 14.3 percent. This is obviously a tragedy and horrific news. However, this is blatant propaganda.

Let’s revisit the 2008 Census total stating that 39.8 million Americans lived in poverty. It turns out that the National Academy of Science did its own study and found that 47.4 million Americans actually lived in poverty in 2008. The Census missed 7.6 million Americans living in poverty that year.

How did that happen? The Census Bureau uses a long outdated method to calculate the poverty rate. The Census is measuring poverty based on costs of living metrics established back in 1955 – 55 years ago! They ignore many key factors, such as the increased costs of medical care, child care, education, transportation, and many other basic costs of living. They also don’t factor geographically-based costs of living. For example, try finding a place to live in New York that costs the same as a place in Florida.

So the Census poverty rate increase of 3.8 million people will put the 2009 National Academy of Science (NAS) number at a minimum of 51.2 million Americans. And if the margin of discrepancy is equivalent to the 7.6 million of 2008, we are looking at a NAS number of at least 52 million people for 2009.

Let’s also consider the fact that more than 20 million people were on unemployment benefits last year. A Center on Budget and Policy Priorities analysis concluded that unemployment insurance temporarily kept 3.3 million people out of poverty. Food stamp assistance kept another 2.3 million people out of poverty. On top of that, an additional 2.3 million people in prison were not counted in the poverty rate. Add up these numbers and we are looking at 60 million Americans living in poverty. Which means the government number glosses over 16.4 million Americans in poverty.

Now let’s look at the poverty line that these numbers are based on: $22,050 for a family of four. Let me repeat that: $22,050 for a family of four. That breaks down to $5513 per person, per year. I don’t know about you, but I can’t imagine living in the United States on $459 per month. That amount will barely get you a good health insurance policy, never mind food, clothes and a roof over your head. No wonder why a record 50.7 million Americans do not have health insurance. (Beware: 50.7 million Americans without health insurance is a government-based number. If you had health insurance for only one day last year, you are not counted in this total.)

Clearly, the Census is setting the income level for their poverty measurement extremely low, and if you increase that measure by just a small increment, to $25,000 for a family of four, you are now looking at nearly 100 million Americans in poverty.

Let’s also consider the staggering amount of Americans – 52 million, roughly 17% of the population – who are currently enrolled in “anti-poverty” programs. Over 50 million are on Medicaid, 41 million are on food stamps, 10 million are on unemployment, 4.4 million receive welfare. Not counted in this “anti-poverty” total are 30 million children enrolled in the National School Lunch Program. Another metric: if it wasn’t for Social Security – note to deficit hawks – 20 million more would be added to the poverty total.

The effect of people moving in with family members instead of living on their own has further masked the severity of the poverty crisis. Foreclosures, unemployment, increased cost of education and health insurance have led the average household to grow in size. As Patrick Martin reports:

“The number of multifamily households increased by 11.6 percent from 2008 to 2010, and the proportion of adults 25-34 living with their parents rose from 12.7 percent in 2008 to 13.4 percent in 2010. The poverty rate for these young adults was 8.5 percent when they were considered part of their parents’ household, but would have been 43 percent if they had been living on their own.”

This trend is currently increasing. Although it is terribly under-reported, foreclosure rates continue to rise. We just experienced the worst month of foreclosures in history; the generation just graduating from college is carrying record levels of student-loan debt, and they are being forced into much lower income levels than anticipated, if they can even find employment.

Another glaring factor clouding our view of poverty in America is that the Census does not calculate a person’s assets and liabilities. Considering the massive debts most Americans are carrying, this would make the poverty rate explode. Stephen Crawford and Shawn Fremstad from Reuters concisely summed up this point:

“As Nobel laureates Joseph Stiglitz and Amartya Sen, along with economist Jean-Paul Fitoussi, write in their new book Mis-measuring Our Lives, ‘Income and consumption are crucial for assessing living standards, but in the end they can only be gauged in conjunction with information on wealth.’ This point is just as relevant to poverty measurement as it is to other measures of living standards.

To understand why this is the case, consider two families: one had an income that puts them a few thousand dollars below the poverty line, which was $22,050 for a family of four in 2009; the other has an income a few thousand dollars above the line. Looking only at income, the first family is worse off than the second.

Now add what the family owns and owes into the mix. Let’s say the first family has substantial net equity in its home and moderate liquid savings for a ‘rainy day,’ while the latter has no liquid savings or, as is becoming too common these days, has liabilities that dwarf their assets such as an ‘underwater’ mortgage. Using this more comprehensive method, the latter family, despite a modestly higher income, is actually the poorer one.”

In my analysis, a key metric to judge the overall economic security and hardship level of a country is the percentage of the population living paycheck to paycheck. Anyone who lives paycheck to paycheck can tell you about the stress and psychological impact it has on you when you know your family is one sickness, injury or downsizing away from economic ruin. The employment company CareerBuilder, in partnership with Harris Interactive, conducts an annual survey to determine the percentage of Americans currently living paycheck to paycheck. In 2007, 43 percent fell into this category. In 2008, the number increased to 49 percent. In 2009, the number skyrocketed up to 61 percent.

In their most recent survey, this number exploded to a mind-shattering 77 percent. Yes, 77 percent of Americans are now living paycheck to paycheck. This means in our nation of 310 million citizens, 239 million Americans are one setback away from economic ruin.

So when I hear the government and media tell me that 43.6 million Americans lived in poverty in 2009, while that is horrifying enough, I get extraordinarily frustrated knowing that even that sad statistic is putting a major positive spin on this economic disaster that is still far from over. While the economic top half of one percent now fears a “double-dip,” the overwhelming majority of Americans are still in the same downward spiral they’ve been on.

For one last missing piece to this equation, corporate profits are soaring while all this is devastation is occurring. Despite this economic crisis, it’s not like our country doesn’t have the money. A recent study done by Capgemini and Merrill Lynch Wealth Management found that a mere one percent of Americans are hoarding $13 TRILLION in “investible wealth.” Yep, one percent of Americans are hoarding $13 TRILLION in “investible wealth,” and that doesn’t even factor in all the money they have hidden in offshore accounts.

As famed American philosopher John Dewey once said, “There is no such thing as the liberty or effective power of an individual, group, or class, except in relation to the liberties, the effective powers, of other individuals, groups or classes.”

The United States now has the highest inequality of wealth in our nation’s history. Tens of millions of Americans are stressing out wondering how they are going to keep their bills paid, and the people who caused this crisis are rolling around in $13 TRILLION. The Robber Barons have been displaced as America’s most despotic and depraved ruling class.

Sing it with me:

“America! America!
God shed his grace on thee,
And crown thy good with brotherhood
From sea to… shining sea! …

America! America!
God mend thine ev’ry flaw,
Confirm thy soul in self-control,
Thy liberty in law! …”

Psst… WAKE UP. The American Dream is over. While you were sleeping we got robbed!