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GM through Kresa’s Eyes

June 5, 2009 3 comments
Double meanings.

Double meanings.

Whenever reading news, it’s far more entertaining to see how they fit within a hypothesis than to simply soak the information up unquestioningly like a sponge. The latter approach seems to be the norm, however, judging from conversations overheard at coffee houses, markets and workplaces. This week we considered once again how things might be setting themselves up for one of our pet doomsday scenarios – global war. War, of course, is not an end in itself, but a means, among other aims, of establishing a new system of world government.. Such a goal requires the dissolution of systems obstructing its implementation, such as national sovereignty which is usually enshrined in constitutional law and held in high regard by the masses. In many nations, abrogating this would require referenda or absolute majorities of Parliament. This is a lengthy and uncertain undertaking, but using war as a pretext can speed things along nicely.

A very interesting and important economic development was noticed in an article by Fareed Zakaria at Clear Markets entitled “Boom Times are Back, Outside the U.S.”:

Around the globe, though, markets are humming. China’s Shanghai index is up 45 percent, India’s Sensex is up 44 percent, Brazil’s Bovespa is up 38 percent and the Indonesia index is up 32 percent. Now, stock markets don’t tell the whole story, but the reason many of these are rising is that the underlying economies of most of these countries are still registering significant growth. The evidence abounds. …

When all was right with the world (for some people anyway), the ones with all the money had all the weapons (the United States of American and NATO). But today, the economies with healthy balance sheets, sustainable debt levels and growing, hard working and productive populations are those with weak military capabilities. Indeed, it’s frequently stated that the world’s combined naval capacity is still no match for that of the United States. This may appear to be the case on paper, but in practice things might be very different.

A little while ago there was an article in the New York Times and elsewhere, describing the scenario of all out war with Iran as being potentially the same as that of a memorable 2002 war simulation where the US navy was resoundingly defeated in record time by being swarmed by small boats. “The whole thing was over in 5, maybe 10 minutes.” were the words of Lt. Gen. Paul K. Van Riper of the winning team. It just shows in a practical way that in modern warfare, defence is easier than offence. It is also not surprising that the U.S. is particularly cold footed on the idea of an Israeli attack on its perceived arch enemy. Currently, the U.S. is neither ready for another ground based invasion, nor is it likely to come out unscathed from an air war with Iran.

While some might see the wealth of the Second World against the military might of the First World as a form of balance, it is in reality a serious imbalance. If two men in the street face eachother, one with a sack of gold and the other with a loaded pistol, the likely outcome is easy to imagine. The man with the gold might swallow his pride and share the gold, but he still risks being shot, because, as has been described by many great thinkers, authors and historians, statecraft is, at best, amoral.

Another thing to consider is what impact the American financial crisis will have on its military capability. As explained today by Bill Bonner on The Daily Reckoning, the General Motors bankruptcy is indeed a foretaste of things to come for the United States as a nation. If the key manufacturers of the U.S. are divided up and sold off, probably to foreign interests, does this not compromise the U.S. military supply chain?

The General Motors bankruptcy would, ordinarily, strike at the heart of the U.S. Military Industrial Complex (MIC). This, however, will not be the case. The new CEO who will likely oversee the subdivision and sell off of GM, already appointed, is Kent Kresa:

Northrop Grumman CEO Kent Kresa and other executives are part of “St. Andrew’s Prep,” an informal network of Andrew Marshall protégés. Marshall directs the Pentagon’s Office of Net Assessment and is an iconoclastic military strategist who was given wide power to define future defense priorities by Defense Secretary Donald Rumsfeld.

This is significant, because it will ensure that the firesale will avoid the risk of key GM assets falling into foreign hands but remaining under the influence of the MIC. It confirms the very sensible theory that a nation’s military infrastructure is actively protected from economic storms. Funny money can do whatever it likes; the US dollar can turn itself into a Peso, but the things that matter happen regardless.

The U.S. is not going to give up its military supremacy, just because central bankers have decided to throw the populace into the throes of poverty and unrest. On the contrary, this can only serve to provide the MIC with ample supply of intelligent but desperate men who until now could not be enticed to join (and die prematurely from serving in) the armed forces. If anyone wonders how the US was going to meet its CO2 production targets as a result of the Waxman-Markey Bill, what with population growth continuing and social change so difficult to achieve, this may be what is coming.

It is still unclear, however, who would want to stand up to the U.S. in a military standoff. North Korea (which frequently looks like China’s alter-ego) doesn’t look anything close to being organized enough to take on its enemies. Consideration for other more realistic players, such as Russia or China (or both together), as being players in an international conflict with Western powers, needs to be taken seriously. Russia, for example, is building its military, showing that it anticipates regional instability in coming years, coming from NATO. China has been doing the same for a long time now, and is likely to ramp up efforts to make best use of its surplus productive capacity (just like the U.S. has always done).

So at this stage, we’re still of the expectation that the Global Financial Crisis, which it should be stressed is an entirely human-made one (nothing natural about it whatsoever) will continue along a fairly predictable path, peacefully. This goes for the next year or two. But after that, when various new military projects mature and the economic fallout starts soiling the currently tidy international relations enjoyed by various powers, things might get interesting. The wrong kind of interesting.

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No Nukes in Iran – Another Low Hanging Fruit?

February 14, 2009 Leave a comment

Frank Barnaby

What is said by the talking heads may or may not be utter garbage, with about 50% probability, regardless of which side they are on at the time.

If one recalls some of the allegations made by the U.S. Government against Saddam Hussein and his alleged Weapons of Mass Destruction programme, then it is no surprise that all the recent huffing and puffing about Iran’s nuclear weapons capability is similarly without merit and substance, as reportedly said by Dennis Blair, new US intelligence chief, in his comments to the Senate Intelligence Committee.

Although we do not know whether Iran currently intends to develop nuclear weapons, we assess Tehran at a minimum is keeping open the option to develop them. … US intelligence assesses that Iran does not currently have a nuclear weapon, and does not yet have enough fissile material for one

Just recapping some of what has been said on the topic purporting the existence of an Iranian nuclear weapons programme:

In 2005 it was alleged that Iran had been building a secret network of underground tunnels in order to manufacture and store nuclear weapons. Admittedly this came from Alireza Jafardazeh, who would is about as opposed to the Iranian government as anyone can get, yet his opinion was given great prominence at the time. What he said then has proven to be crap. So what about all the other things he alleged, such as Iran’s role in supporting the Iraqi insurgency? True or not, it would seem that this man is far too complex to take seriously.

In a very interesting statement, back in 2002, a Russian general stated that Iran already has a nuclear bomb.

Iran does have nuclear weapons … Of course, these are non-strategic nuclear weapons. I mean these are not ICBMs with a range of more than 5,500 kilometers and more. But as a military man, I see no danger of aggression against Russia by Iran. As for the danger of Iran’s attack on the United States, the danger is zero”

In 2003, the Time Magazine hinted at Iran’s nuclear ambitions. This was shortly before the US invasion of Iraq.

In 2006 The Guardian reported on an assessment by European intelligence agencies:

The assessment declares that Iran has developed an extensive web of front companies, official bodies, academic institutes and middlemen dedicated to obtaining – in western Europe and in the former Soviet Union – the expertise, training, and equipment for nuclear programmes, missile development, and biological and chemical weapons arsenals.

And the spin was still going at full bore in late 2008 at the New York Times:

“They clearly have enough material for a bomb,” said Richard L. Garwin, a top nuclear physicist who helped invent the hydrogen bomb and has advised Washington for decades. “They know how to do the enrichment. Whether they know how to design a bomb, well, that’s another matter.”

Yet now we see that it was probably all bluff. The US, it now seems, knew all along that Iran was miles away from making “the Bomb”, but it was politically expedient to paint the opposite picture at the time. It was noticeable how the language of reporting has changed on the topic as well. The public has already been conditioned to equate the term “nuclear Iran” with “the Bomb”, yet “nuclear Iran” is no different to “nuclear Germany” in that both have nuclear power stations.

Is this new admission believable? The US doesn’t look like it wants war with Iran just now. It does seem that things haven’t quite been going according to plan lately with regards to the economy and military. Major events are happening off schedule and the invicible ones are suddenly appearing rather weak.

It’s probably true that Iran has no nuclear weapons. Could we be having another Peace Crisis? We all know that can’t last for long. What are governments going to do with all the unemployed? In the past they managed to get rid of quite a few of them by sending them to the Front. The answer will probably come sooner rather than later.