First Enron, now WorldCom: two huge iconic companies brought low by accounting fiddles.
The consequent pressure on auditors and accountants - the guardians of a company's numbers - is intense.
But if it's bad for the beancounters, imagine what it must be like if your job is to keep an eye on them.
The Securities and Exchange Commission has that dubious honour in the US, and it's no surprise that it is squirming under the spotlight.
Oversight
Its chairman, Harvey Pitt, has accelerated proposals shaped post-Enron last year to institute a new oversight of the accountancy business.
On the table is a nine-person "Public Accountability Board", only three of whose members will be accountants, with the power to fine and censure transgressors.
The agency is in line for a 77%, $337m boost to its budget, rapidly approved by the House of Representatives on Wednesday.
He has also announced plans to make company bosses sign off personally on accounts, in an attempt to bar the "No-one told me" defence employed by executives at both Enron and WorldCom.
And the SEC has hurried to sue WorldCom for fraud, making sure, Mr Pitt said, that it is prohibited from indulging in an Enron-style paper shredding party.
Demanding a sworn report of how it came to announce that it had hidden $3.8bn in expenses, Mr Pitt told reporters that what had happened at WorldCom - "and we do not yet know all that has happened" - was an "outrage".
"What we also know we're looking at isn't a mistake, it's a fraud," he said.
Tuesday, July 30, 2002
NEW YORK The real cause of spreading corporate malfeasance in America is a lack of faith in democratic institutions. Business malfeasance is the consequence neither of systemic capitalist contradictions nor of private sin, which are endemic to capitalism and indeed to humanity. It arises from a failure of the instruments of democracy, which have been weakened by three decades of market fundamentalism, privatization ideology and resentment of government.
Capitalism is not too strong; democracy is too weak. Americans have not grown too hubristic as producers and consumers; we have grown too timid as citizens, acquiescing in deregulation and privatization (airlines, accounting firms, banks, media conglomerates, you name it) and a growing tyranny of money over politics.
The corrosive effects of this trend are visible not only on Wall Street. The Bush administration, which favors energy production over energy conservation, has engineered a reversal of a generation of progress on environmentalism.
These policies can be traced directly to that proud disdain for the public realm that is common to all market fundamentalists. Such attitudes represent a penchant for a go-it-alone economics that undermines the social contract and turns corporate sins into virtues of the bottom line.
Even in foreign policy, where unilateralism and the repudiation of partnerships might suggest a muscular governmental policy, there is a tendency to treat the international sector as a Hobbesian "state of nature," anarchic and disorderly, where "force and fraud are cardinal virtues." The United States fails to see that the international treaties it will not sign, the criminal court it will not acknowledge and the United Nations system it does not adequately support are efforts, however compromised, at developing a new global contract to contain the chaos. The American belittlement of these efforts betrays a strategy that enhances global anarchy in the name of preserving national sovereignty. Thus the new global disorder is as incapable of constraining global crime as the deregulated domestic market is incapable of containing corporate crime.
Market fundamentalism, which defined the era of Ronald Reagan and Margaret Thatcher, encourages a myth of omnipotent markets. But this is as foolish and wrongheaded as the myth of omnipotent states, which reigned from the New Deal to the Great Society. It tricks people into believing that their own common power represents some bureaucrat's hegemony over them, and that buying power is the same as voting power. But consumers are not citizens, and markets cannot exercise democratic sovereignty. The ascendant market ideology claims to free us, but it actually robs us of the civic freedom by which we control the social consequences of private choices.
The truth is that runaway capitalists, environmental know-nothings, irresponsible accountants, amoral drug runners and anti-modern terrorists all flourish because we have diminished the power of the public sphere. By privatizing government functions and refusing to help create democratic institutions of global governance, America has relinquished its authority to control these forces.
Within the United States, we foolishly think we possess a private liberty that allows us to work and prosper individually, not together or in conformity with a social contract. In the international realm, we seem to believe that our claim to national sovereignty allows us to operate unilaterally, not together or in conformity with a global contract.
On Sept. 11 no one looked to Bill Gates or Michael Eisner for national leadership. On that day Americans remembered the true meaning of words like citizen and public servant and relied upon firefighters, mayors, Congress and the president. Why then today do we expect corporate executives or "market professionals" to cure the disorders of anarchic market capitalism - which, as Theodore Roosevelt understood, responds only to democratic oversight? And how do we expect a go-it-alone superpower to depose terrorists who exploit the global interdependence that America is reluctant to recognize? These ends are public. To secure them is the common task of every citizen.
Monday, July 29, 2002
WITH SPIRO ("TED") Agnew, it was so simple. He was charged with pocketing more than $100,000 in graft from Maryland engineering firms, one of which took the trouble to have someone personally deliver an envelope with $10,000 in small bills to the newly elected U.S. vice-president at his suite in the Executive Office Building in Washington. Bribery is plainly illegal, so Ted pleaded "no contest" to the charges against him and quit public life in 1973.
But you look at Dick Cheney's brief stint in business from 1995 to 2000, prior to joining the Bush ticket, and you don't see anything illegal. Not yet, anyway.
There's nothing illegal about a former U.S. defence secretary and Gulf War hero accepting a plum post as CEO of a tainted firm, Halliburton Co., that was harshly criticized in the early 1990s for selling oil-drilling equipment to, of all places, Saddam Hussein's Iraq. In 1995, the same year Cheney decided to try his hand at business with Halliburton after a lifelong career in politics, the company pleaded guilty to violating the U.S. ban on exports to Libya, having peddled to strongman Moammar Gadhafi six pulse nuclear generators that could be used to detonate nuclear weapons.
Nor was there anything illegal about Cheney's inability, as CEO, to stop the stain of questionable conduct at the Texas-based oil-services and construction company from spreading. Under Cheney, Halliburton continued to do business with countries the U.S. has described as "rogue nations," including Libya, Iran and Iraq.
And it overbilled the Pentagon on contracts over a four-year period ending in 1998 — charging $750,000 (U.S.) for electrical repairs at Fort Ord in California that actually cost about $125,000, for example — and ultimately reached a settlement with the Army in which it paid a $2 million fine.
Also in 1998, Halliburton, with the assistance of its auditor, Arthur Andersen, altered the company's accounting methods in a way that postponed losses from deadbeat clients, a device that artificially inflated Halliburton's profits by about $100 million and is now the subject of an investigation by the U.S. Securities and Exchange Commission.
While visiting friends in Aspen last week, I had a close encounter of the disgraced CEO kind: I spotted Kenny Lay, garbed in a spiffy jogging suit, getting in a little morning cardio not far from one of the two multimillion dollar vacation homes he keeps there. I guess that second-hand shop his wife opened to sell off some of their booty has been doing brisk business.
Truth be told, such scoundrel sightings are not as unusual as they should be. Despite the well-deserved roasting they’re currently getting over the media spit, many of the most notorious boardroom bad guys are continuing to live the high-life to which they became accustomed while plundering their companies' coffers.
Even Adelphia's John Rigas, who was forced to do the newly-trendy EPW (Executive Perp Walk) following his arrest, had enough spare change on hand to cover his $10 million bail -- and was back home in plenty of time for a nice family dinner with his indicted sons. You know what they say: the family that eats together, cheats together.
The victims of corporate pillage, meanwhile, are not having it so easy. Faced with scrambled nest eggs, sinking pension plans, shaky health coverage and a gloomy job market, record numbers of average Americans are taking it on the chin -- and in the wallet.
A key indicator of just how bad things have gotten for the little guy is the record number of Americans -- 1.5 million -- who filed for personal bankruptcy in the year ending March 31st. That's one out of every 69 U.S. households.
And since bankruptcies invariably lag behind current economic conditions -- they are the fiscal equivalent of those guys in the circus who follow after the elephants with a shovel, trying to deal with the mess the parade has left behind -- the odds are high that 2002 will be an even better year for bankruptcy attorneys. The first quarter of this year has already seen a record 369,237 filings.
And it's important to note that only 3% of these filings are by people who abuse the system by living extravagant lifestyles and then leaving their creditors holding the bag. The majority are actually low to middle class people who can't pay their bills because they've lost their jobs or been hit with crippling medical bills or been enticed into running up unmanageable credit card balances by easy-credit come-ons and here-today-gone-tomorrow "teaser" interest rates.
Nevertheless, Congress is on the verge of passing legislation that will make it harder for people to start afresh after they declare bankruptcy while, not coincidentally, adding billions of dollars to the bottom line of banks and credit card companies.
And why are our elected representatives so eager to add to the burden of consumers struggling to rebuild their lives amidst tough economic times? Perhaps it has something to do with the $27.5 million the finance and credit industries have contributed to political campaigns since 1990 -- including $3,518,966 so far in the 2002 election cycle.
Long before George W. Bush won the 2000 presidential election, his chief political adviser, Karl Rove, was predicting to reporters that a Bush victory would produce a historic political realignment. This new Republican majority would resemble the one William McKinley built roughly one century ago. "I look at this time as 1896, the time where we saw the rise of William McKinley and his vice president, Teddy Roosevelt," Rove declared. "That was the last time we had a shift in political paradigm." Just as McKinley exploited America's shift from an agrarian to an industrial economy to build his majority, Bush would exploit America's "transformational" shift from an industrial to a postindustrial economy to build his. Bush would be the candidate and the president of the "new economy."
In Rove's mind, September 11 has reinforced the parallel: Bush's war on terrorism is the political equivalent of McKinley's Spanish-American War. As U.S. News & World Report columnist Michael Barone wrote in February, Rove "looks back to William McKinley, who was elected with 51 percent of the vote in 1896 but whose successful war and domestic policies built that up to a solid majority for years ahead." And the current financial scandals are merely a bump along that inevitable road. The scandals, Rove told NBC's Tim Russert on July 13, are a "business problem ... not a political scandal" and will not affect the underlying movement toward a new Republican majority.
Rove is half right. He's correct that we are in a transformational political era that displays marked similarities to 1896. And he is correct that this era will produce a majority party that dominates American politics for years to come. It just won't be the GOP. To the contrary, ever since the collapse of the Reagan conservative majority, which enjoyed its final triumph in November 1994, American politics has been turning slowly, but inexorably, toward a new Democratic majority. It was evident in Al Gore's popular-vote victory in 2000 (made more significant by the overhang of the Bill Clinton scandals and Gore's ineptitude as a campaigner) and in Bush's and the Republicans' sinking fortunes in the first two-thirds of 2001. It was obscured by the patriotic rush of support for Bush after September 11, which to some extent carried over to the Republican Party as a whole. But it has resurfaced in recent months as Americans have turned their attention back to the economy and domestic policy and away from the war on terrorism. Far from being a temporary distraction from a long-term shift toward the GOP, popular anger at the business scandals and the plummeting Dow heralds the resumption of a long-term shift toward the Democrats.
If this emerging Democratic majority has eluded many observers, perhaps it is because it differs substantially from the New Deal Democratic coalition that dominated American politics from 1932 to 1968. Today the Democrats are increasingly a party of professionals, women, and minorities rather than of blue-collar workers. They are based in postindustrial metropolitan areas rather than in the small-town South and the Rust Belt North. And they are a party of the progressive center rather than the Great Society left or the laissez-faire right. The new Democratic Party's true historical antecedent is, ironically, that same progressive Republican Party of the early twentieth century that Rove identifies with the Bush Republicans. It, and not Bush's GOP, will oversee America's postindustrial transition because it, and not Bush's GOP, embodies the demographic and cultural changes that this new America will bring.
I am like one of those monomaniacs who button-hole you at parties--ranting about bird-watching, say, and jabbing you in the chest. I can't stop writing about corporate malfeasance.
But I can add something new, and controversial: I know who's responsible for the fraudulent accounting that allowed WorldCom, Enron, Global Crossing, and others to deceive investors.
It was Newt Gingrich--Newt, and the ideologically over-heated, maniacally anti-government, anti-regulatory House Republicans who came to office in the fall of 1994.
Here's why. In three specific cases--tort reform, the accounting of options, and the separation of an accounting firm's audit and consulting services--House Republicans successfully sought to block regulation that would have made corporations transparent. Without Newt Gingrich, there would have been no crisis in business and accounting, at least in this form.
Washington, DC—Attorney General John Ashcroft misled Congress and the American public when he repeatedly stated that the Justice Department was legally prohibited from checking gun purchase records in connection with the post-9/11 terrorism investigation to determine if potential terrorists had purchased firearms, a new General Accounting Office (GAO) report reveals. The Justice Department's refusal to review the records received widespread press attention when it was revealed by the Violence Policy Center (VPC) in December 2001.
The report, Gun Control: Potential Effects of Next-Day Destruction of NICS Background Check Records, reveals for the first time the existence of an October 1, 2001 memorandum prepared by the Justice Department's Office of Legal Counsel (OLC). [The VPC has obtained a full copy of the memo.] The memo concludes that the Federal Bureau of Investigation has the legal authority to check approved gun purchase records to ascertain whether prohibited persons bought guns in connection with the post-9/11 terrorism investigation. The memorandum flatly contradicts Attorney General Ashcroft's insistence that the Justice Department was legally prohibited from checking approved gun purchase records in connection with the terrorism investigation.
"The OLC memorandum is the smoking gun proving that Ashcroft grossly misled Congress and the American people," states Mathew Nosanchuk, VPC litigation director and legislative counsel. "Attorney General Ashcroft described the Department's legal authority with the same accuracy that WorldCom reported its profits."
Despite withering public and congressional criticism of the Justice Department's position, the Department never disclosed the existence of the OLC memorandum. The VPC has identified no less than eight separate statements to the news media and in congressional testimony by Justice Department officials asserting in unequivocal terms that the Department lacked the legal authority to do precisely what the October 2001 OLC memo said was legal.
The report, which examines the potential impact of the Ashcroft Justice Department's proposal to require the destruction of approved gun purchase records within 24 hours, concludes that the destruction of records would have dire consequences for public safety. Another key finding is that retained records were used to initiate firearms retrieval actions, which take place when a felon, fugitive, domestic abuser, or other prohibited person clears a background check and law enforcement subsequently finds out they are prohibited. In an astonishing 97 percent of retrieval cases that the GAO studied over a six-month period, law enforcement would not have been able to retrieve an illegally purchased firearm from a prohibited person under the shortened retention period proposed by the Attorney General.
Adds Nosanchuk, "The GAO report should put the final nail in the coffin of the Ashcroft Justice Department's records-destruction proposal. The report leaves no doubt that when it comes to enforcing the gun laws Attorney General Ashcroft is not guided by facts, law, or public safety, but by blind allegiance to the gun lobby."
ANCHOR: Former President Bill Clinton was in Washington to commemorate the passage of the Americans With Disabilities Act.
Only on 7, he spoke to ABC 7 News reporter Rebecca Cooper about the Bush administration, corporate wrongdoing and the Middle East.
Story:
On July 8th President Bush defended his embattled Securities and Exchange Commissioner, saying Harvey Pitt was doing his best to clean up a mess that was already in place. Today President Clinton responded to Republican charges that corporate wrongdoing started under his watch.
PRESIDENT BILL CLINTON: "These people ran on responsibility, but as soon as you scratch them they go straight to blame. Now, you know, I didn't blame his father for Somalia. ... I didn't do that. And I think that's not a real mark of leadership and it's the wrong thing to do. But in this case, it's factually wrong."
Former President Clinton says it's the Republicans who blocked his attempts to clean up corporate America and now he's criticizing President Bush for appointing Pitt.
CLINTON: "There was corporate malfeasance both before he took office and after. The difference is I actually tried to do something about it and their party stopped it. And one of the people who stopped our attempt to stop Enron accounting was made chairman of the Securities and Exchange Commission."
In his one-on-one interview with ABC 7 News, former President Clinton also responded to White House criticisms of Clinton's handling of the Middle East.
CLINTON: "We had seven years of progress towards peace in the Middle East and they tried to blame me for the trouble in the Middle East. That's just what they do. Republicans have always done that. But it's bad form, and it's bad for America, and they should stop it. And they should get about the business of solving the problems."
COOPER ON SET: President Clinton told ABC 7 News he thinks the it was a mistake for the Bush Administration to disengage from the Middle East peace process, but he says the White House is doing the right thing by engaging now.
Rebecca Cooper, ABC 7 News, Washington.
Tony Blair has been told by the Government's own lawyers that British participation in an invasion of Iraq would be illegal without a new United Nations mandate.
The advice, which is highly confidential, has led the Foreign Office to warn Downing Street that a fresh UN resolution could be the best means of ensuring Russian and moderate Arab support for any attack against Saddam Hussein.
Senior government sources say the Prime Minister has also received conflicting legal opinion from law officers that current UN resolutions could offer sufficient cover for any military action. But the very fact that even one part of Government has been told an attack could be illegal will delight the many Labour MPs worried that Mr Blair will unilaterally back an American assault.
The legal advice in favour of a new UN resolution is in tune with similar calls made by Dr Rowan Williams, the incoming Archbishop of Canterbury.
A Broward company headed by a one-time business partner of Gov. Jeb Bush wants to seal records in a federal case in which the firm is accused of having bribed officials in Nigeria as part of a water-pump sale.
The records could include any pretrial deposition given by Bush about his role in a company that he once owned with J. David Eller, who now runs MWI Corp., the company being sued.
Bush has never given a full accounting of the work he did for Bush-El Trading Corp., which did business in Nigeria and a host of other foreign countries while his father was president.
In 1994, when he first ran for governor, Bush sold his share in the company for $648,250 to Eller.
The company later changed its name.
Eller owns MWI, a Deerfield Beach-based firm that makes water pumps, and he still has ties to Bush.
He co-sponsored a Bush reelection fund-raiser on June 17 in Davie. He has also contributed money to Bush's gubernatorial campaigns.
MWI is defending against a lawsuit involving a decade-old business deal with Nigeria that went sour amid the bribery allegations. The governor's office has said that the lawsuit does not involve Bush, and Bush has said he had no role in the Nigerian pump deal.
MWI is seeking a federal judge's order to seal pretrial documents. Bill Scherer Jr., MWI's Broward-based attorney, said Bush was not on the list of people expected to be called as witnesses, and who would thus be subject to a pretrial deposition.
Two years ago the world watched as officials in Florida struggled to explain the mishaps and shoddy practices that had denied thousands of Floridians a chance to vote. They focused on butterfly ballots and hanging chads, but neglected a critical part of the problem: over half a million Florida residents had been prevented from voting by a state law that permanently disenfranchises almost anyone ever convicted of a felony, even those who haven't committed a crime since serving their terms, have jobs and are paying taxes. For like many Southern states, Florida had cemented felony disenfranchisement into its constitution in the post-Civil War years, when legislators were using any means to keep the vote in white hands.
Following the 2000 presidential election, several states changed their suffrage laws. New Mexico, Delaware and Maryland either abandoned or curtailed their disenfranchisement provisions; Connecticut enfranchised people on probation; and lawyers in Washington State are working on a case to overturn that state's disenfranchisement laws. Iowa, Arizona, Nevada and Wyoming retain their catch-all, permanent disenfranchisement laws. But the bulk of the disenfranchised live in southern states — Florida, Alabama, Mississippi, Kentucky, Tennessee and Virginia — and in several of these conservative legislators are fighting efforts at enfranchisement. Some experts estimate that in Alabama, Mississippi and Florida a quarter or more of black men are now permanently barred from voting.
On July 18, Judge James Lawrence King of the Federal District Court for the Southern District of Florida dismissed a lawsuit against Florida's disenfranchisement laws. The lawsuit had been filed by the Brennan Center for Justice at New York University School of Law on behalf of seven plaintiffs, first among them one Thomas Johnson, who weren't allowed to vote in the last presidential election. In his brief opinion, Judge King began by misnaming the lead plaintiff as Thomas Jefferson. From there, it only got worse.
Brennan Center lawyers argued that the history of the South's felony disenfranchisement laws — along with studies indicating minorities are at particular risk of getting arrested and more likely than whites to receive felony convictions for comparable crimes — meant permanent disenfranchisement violated the 14th Amendment's equal protection clauses. They also argued that Florida was violating the 1965 Voting Rights Act.
Saudi Arabia is teetering on the brink of collapse, fuelling Foreign Office fears of an extremist takeover of one of the West's key allies in the war on terror.
Anti-government demonstrations have swept the desert kingdom in the past months in protest at the pro-American stance of the de facto ruler, Prince Abdullah.
At the same time, Whitehall officials are concerned that Abdullah could face a palace coup from elements within the royal family sympathetic to al-Qaeda.
Saudi sources said the Pentagon had recently sponsored a secret conference to look at options if the royal family fell.
Demonstrations across the kingdom broke out in March, triggered by a fire in a girls' school in which 14 pupils died after the religious police stopped them escaping.
Unrest in the east of the country rapidly escalated into nationwide protests against the royal family that were brutally suppressed by the police. The Observer has obtained secret video footage of the protests smuggled out of the country last week that shows hundreds of Saudis, including women, demonstrating in support of the Palestinians and opposition to the regime.
The Foreign Office believes that the failure of Abdullah's recent Middle East peace plan could have terminally undermined his position.
The Crown Prince's main rival, Prince Sultan, the Defence Minister, has been vocal in his opposition to Abdullah's pro-Western policy. His brother Prince Naif, head of the Interior Ministry, has led a crackdown on the Saudi media in the wake of the demonstrations to stop any word of them leaking out.
Abdullah has even sent his own representative to Washington to counter the influence of the ambassador, Prince Bandar, a son of Prince Sultan.
BERLIN -- The Atlantic alliance between the United States and Europe, the most successful international bonding of all time, is breaking down amid starkly differing visions of a changing world and both sides' proper place in it.
The alliance, a mesh of military, economic, cultural and historic ties, was born in the ashes of World War II, the coupling of a young superpower and old nation-states devastated by conflict. The alliance produced the Marshall Plan and NATO, fought and won the Cold War and created the most prosperous and peaceful assembly of democracies in history. Its dramatic erosion, which is not a priority in a Washington fixated on terrorism, has become an obsession in Europe.
No total rupture is likely, nor are former friends about to become foes. Economic ties, both trade and investment, will stay strong. NATO, the institutional cornerstone of the alliance, probably will survive, but in a reduced and less military role.
The alliance's trend is not toward hostility but toward irrelevance, with the United States, by far its dominant member, dealing with threats beyond Europe and less interested in what the Europeans think and do. The Europeans, for their part, are preoccupied with their own continent and offended by what they see as American unilateralism.
For both sides, the Atlantic alliance has been the anchor of foreign policy since World War II. So for both, its fraying means a basic shift in the way they deal with the world.
George W. Bush channels George Orwell
Here's a question for constitutional scholars: Can a sitting president be charged with plagiarism?
As President Bush wages his war against terrorism and moves to create a huge homeland security apparatus, he appears to be borrowing heavily, if not ripping off ideas outright, from George Orwell. The work in question is "1984, " the prophetic novel about a government that controls the masses by spreading propaganda, cracking down on subversive thought and altering history to suit its needs. It was intended to be read as a warning about the evils of totalitarianism -- not a how-to manual.
Granted, we're a long way from resembling the kind of authoritarian state Orwell depicted, but some of the similarities are starting to get a bit eerie.
PERMANENT WAR
In "1984," the state remained perpetually at war against a vague and ever- changing enemy. The war took place largely in the abstract, but it served as a convenient vehicle to fuel hatred, nurture fear and justify the regime's autocratic practices.
Bush's war against terrorism has become almost as amorphous. Although we are told the president's resolve is steady and the mission clear, we seem to know less and less about the enemy we are fighting. What began as a war against Osama bin Laden and al Qaeda quickly morphed into a war against Afghanistan, followed by dire warnings about an "Axis of Evil," the targeting of terrorists in some 50 to 60 countries, and now the beginnings of a major campaign against Iraq. Exactly what will constitute success in this war remains unclear, but the one thing the Bush administration has made certain is that the war will continue "indefinitely."
MINISTRY OF TRUTH
Serving as the propaganda arm of the ruling party in "1984," the Ministry of Truth not only spread lies to suit its strategic goals, but constantly rewrote and falsified history. It is a practice that has become increasingly commonplace in the Bush White House, where presidential transcripts are routinely sanitized to remove the president's gaffes, accounts of intelligence warnings prior to Sept. 11 get spottier with each retelling, and the facts surrounding Bush's past financial dealings are subject to continual revision.
The Bush administration has been surprisingly up front about its intentions of propagating falsehoods. In February, for example, the Pentagon announced a plan to create an Office of Strategic Influence to provide false news and information abroad to help manipulate public opinion and further its military objectives. Following a public outcry, the Pentagon said it would close the office -- news that would have sounded more convincing had it not come from a place that just announced it was planning to spread misinformation.
It doesn't look pretty: The United States ranks last among the world's 28 top foreign aid donor countries, and its foreign assistance levels have dropped dramatically over the past 10 years, according to a United Nations report released this week.
The United Nations Human Development Report 2002, a wide-ranging report that includes both fascinating country statistics and a questionable development ranking of 137 nations, puts the United States well below Denmark, the Netherlands, Japan and even Spain and Portugal on the list of the biggest foreign aid donor countries relative to the size of their economies.
Granted, if you look at the actual dollar figures, the $9.9 billion annual U.S. foreign assistance ranks only second after Japan's $13.5 billion.
But when you look at countries' foreign aid relative to the size of their economies, the United States is devoting 0.1 per cent of its gross national product (GNP) to help the world's poorest countries, less than any other industrialized nation.
By comparison, Denmark spends 1.06 percent of its GNP on foreign aid, the Netherlands 0.84 percent, Norway 0.80 percent, Germany 0.27 percent, Japan 0.28 percent, Portugal 0.26 percent, and Spain 0.22 percent. What's worse, U.S. foreign aid has by this measure been cut in half over the past 10 years.
Is this something we should care about? You bet. Until earlier this year, the decline in U.S. foreign aid was not seen as a catastrophe in Washington: Conservative Republicans had persuaded many moderates in Congress that foreign aid had for many years been wasted in handouts to corrupt foreign leaders who often stashed it in their Swiss bank accounts.
Foreign Minister Shimon Peres said yesterday that the Israel Defense Forces' bombing of Hamas leader Salah Shehadeh's apartment in Gaza last Monday had been an "absolute mistake."
"Yes, it was a miscalculation, 100-percent a mistake. The outcome shows clearly that we used the wrong weapon. The bomb caused more harm than good," Peres told the German news magazine, Der Spiegel, in an interview released ahead of publication yesterday.
The Israeli strike in a crowded neighborhood of Gaza City killed 16 people aside from the Hamas leader and injured more than 150.
Peres added in the Der Spiegel interview that he had "doubts" about Prime Minister Ariel Sharon's commitment to peace in the Middle East. Though he confessed to doubts about whether Sharon could be considered a partner for peace, Peres vowed to the German magazine that he would remain in Israel's unity government for as long as he could "serve as a balancing factor."
U.S. Ambassador to Israel Dan Kurtzer said late last week that steps such as a settlement freeze and the dismantling of illegal outposts should be taken in the name of an "improved atmosphere" between Israel and the Palestinians. Kurtzer spoke on Thursday during a meeting between an Israeli diplomatic team, headed by Foreign Minister Shimon Peres, and members of the international task force for reforms in the Palestinian Authority.
Last week, senior U.S. officials told Prime Minister Ariel Sharon's emissaries - his chief of staff, Dov Weisglas, and Israel Defense Force Major General Moshe Kaplinski - that they were abiding by the demand that Palestinian Authority Chairman Yasser Arafat be replaced and that no diplomatic contacts were being held with the PA leader.
AMERICAN forces may have breached human rights and then removed evidence after the so-called wedding party airstrike that killed more than 50 Afghan civilians this month, according to a draft United Nations report seen by The Times.
A preliminary UN investigation has found no corroboration of American claims that its aircraft were fired on from the ground, and says there were discrepancies in US accounts of what happened.
If the findings are upheld by a second, more detailed, UN investigation, they will cause huge embarrassment to the Pentagon.
UN sources said that the findings pointed to an American cover-up, and suggested that American investigators were dragging their feet hoping that the issue would pass.
The attack took place early on July 1 as American forces hunted pockets of Taleban and al-Qaeda resistance. A US helicopter gunship opened fire on targets around the village of Kakarak, and the casualties included 25 members of one family at a wedding party.
A UN source said that the report was produced by a team of “experienced and reputable UN people, who have been in the region a while and know it well”. It states that there was clear evidence that human rights violations had taken place and that coalition forces had arrived on the scene very quickly after the airstrikes and “cleaned the area”, removing evidence of “shrapnel, bullets and traces of blood”. Women on the scene had their hands tied behind their backs.
Recent pronouncements from the Bush Administration and national security initiatives put in place in the Reagan era could see internment camps and martial law in the United States.
When president Ronald Reagan was considering invading Nicaragua he issued a series of executive orders that provided the Federal Emergency Management Agency (FEMA) with broad powers in the event of a "crisis" such as "violent and widespread internal dissent or national opposition against a US military invasion abroad". They were never used.
But with the looming possibility of a US invasion of Iraq, recent pronouncements by President George Bush's domestic security chief, Tom Ridge, and an official with the US Civil Rights Commission should fire concerns that these powers could be employed or a de facto drift into their deployment could occur.
On July 20 the Detroit Free Press ran a story entitled "Arabs in US could be held, official warns". The story referred to a member of the US Civil Rights Commission who foresaw the possibility of internment camps for Arab Americans. FEMA has practised for such an occasion.
FEMA, whose main role is disaster response, is also responsible for handling US domestic unrest.
It was 1992, and I had been renting her apartment in Prague for about a year. I had gone to the former Eastern Bloc shortly after graduate school on a United States government fellowship, and I felt it my duty to show by example how the free world worked. I thought I had been a model tenant. I kept the place neat, I paid my rent faithfully, I even made sure to put out fresh flowers when I knew she was coming over.
But that was the problem: I didn't always know she was coming over. She used to come in when I wasn't home, on tips from the neighbors.
When Helena — my age and, I thought, my friend — came that night to tell me to leave, she laid down a litany of charges: You shower too often. You talk on the phone late at night. You leave your pajamas out and the bed unmade. You've had men here. You have a cat.
Oddly, that was the charge that stunned me most. I had minded a friend's cat for a weekend once. How could she possibly know all this, I wondered. The neighbors had told her, I learned. They had called her to say I had a cat.
It had never occurred to me the elderly lady next door was spying. Nor did I think anything of the woman who seemed always to be on the landing when I came and went, which must seem incredibly naïve. After all, everyone knew the Communists snitched on one another, right? But I never thought they'd spy on me. There was nothing interesting about my life. I had nothing to hide and I wasn't doing anything wrong. But I was different: single, a woman, a foreigner. And that was enough to get me watched.
So the recent brainstorm by the Justice Department to enlist couriers, meter readers, cable installers and telephone repairmen to snoop on people's private lives for anything "suspicious" dredged a cold and until now forgotten feeling from the pit of my stomach. Many have objected that such a program would violate civil liberties and basic American principles. But stoking people's fear to set neighbor upon neighbor, service worker upon client, those who belong against those who don't, does something more: it erodes the soul of the watcher and the watched, replacing healthy national pride with mute suspicion, breeding insular individuals more concerned with self-preservation than with society at large. Ultimately it creates a climate that is inherently antithetical to security.
Remember the movie The Cable Guy? It's the one where Jim Carrey plays a cable-TV repairman who only wants to help, yet he unwittingly sets out to ruin the life of one of his customers. That story could be coming to a reality near you.
That's right. The government wants your cable guy, meter reader, even your postman to voluntarily report any and all suspicious information about you to a new, central FBI database. It's called Operation TIPS, short for the Terrorism Information & Prevention System. The goal is to give millions of American truckers, letter carriers, train conductors, ship captains, and utility employees a formal way to report suspicious activity.
A pilot phase, slated to begin later this summer, would initially recruit 1 million workers in 10 cities. The Teamsters Union has already signed on. The U.S. Postal Service, which originally said its 800,000 workers would not participate, is also encouraging its workforce to join.
SOWING SUSPICION. The idea is the brainchild of Attorney General John Ashcroft. But like many of Ashcroft's salvos in the war on terrorism, Operation TIPS will more than likely reduce privacy without increasing security. Let's be real: Terrorists with half a brain aren't likely to be outsmarted by the mailman or open the door to have the gas meter read if they have bomb-making material nearby.
But ordinary people, who might be reading the Koran, will. The result could be a flood of unsubstantiated and largely irrelevant tips that overwhelm law-enforcement officials already mired in data. Worst of all, the program could sow the seeds of suspicion among loyal American citizens.
Privacy-protection advocates allege that Operation TIPS is simply a way for the FBI to get into people's homes without a warrant. Before the police or FBI can search your residence, they need probable cause and an order from a judge. But you let the cable guy into your home voluntarily. And once you do that, you relinquish certain rights of privacy. Whatever the cable guy sees is fair game.
It seems to me that the terrorists with whom America is "at war" are doing exactly the right thing — nothing.
In the meantime, the U.S. government seems to be digging itself into a deeper and deeper hole. There are raucous debates over anti-terrorism measures; any concern for budget discipline has gone out the window; government power is being expanded on a willy-nilly basis; civil liberties are being put in jeopardy; the American economy, particularly the aviation industry, is being strained; and pressing problems such as the environment, economic infrastructure and a sensible trade policy are all shoved to the back burner.
And what has all this cost the terrorists? Nothing. Not a single bullet, not a stick of dynamite. Nearly a year ago, some men hijacked four airplanes and crashed them, dying with their victims. Since then, nothing has happened. While we have gone to war in Afghanistan, made a mess of foreign policy, greatly alarmed our traditional allies and, frankly, conducted ourselves in general as a nascent fascist state, the terrorists have done nothing.
Even conservative Christians have become alarmed by Attorney General John Ashcroft, whose nomination they lobbied for heavily. But Ashcroft, with visions of evil Muslims floating in his head and a terrorist under every bed, seems to have gone over the side of the good ship Common Sense.
For a while, it seemed as if President Bush was ready to declare war on the entire rest of the world, and even now he wants to convert the military into a domestic police force, as well as set up civilian vigilante and block spy committees.
Does anyone else think we might have overreacted?
KING ABDULLAH of Jordan will this week challenge President Bush to live up to his promise of a Palestinian state by urging him to produce a Middle East “action plan” with firm deadlines and timetables.
He will tell Mr Bush that unless emergency aid is sent to relieve suffering in Gaza and the West Bank, desperation will push more Palestinians into extremism and terrorism.
In an interview with The Times, the King made clear that when he meets Mr Bush on Wednesday he will demand full backing for Colin Powell, the embattled US Secretary of State, against the Pentagon hawks who are “fixated on Iraq”. He gave a warning that any American action against Iraq would open a “Pandora’s box” in the Middle East.
The King will also admit that Arab countries must do more to flesh out their own peace proposals which, he says, offer Israel far more than Washington or Jerusalem realise. Arab Governments must now make clear that they will guarantee “everything that Israel wants from them”.
In an extraordinary, wide-ranging interview, King Abdullah criticised Mr Bush’s call for Yassir Arafat’s removal, saying that this only boosted the Palestinian leader’s popularity and set back Palestinian moves to oust him.
A 14-year-old Palestinian girl was killed and her brothers wounded when they tried to rescue her, as Hebron settlers and supporters attending the funeral of Elazar Leibovitz, an Avraham Avinu resident, rampaged through the Arab town, shooting at Palestinian buildings.
During the funeral procession for Leibovitz, who was born in the Jewish enclave in the town, calls for revenge turned into rock-throwing at Palestinians in the neighborhoods between the Tomb of the Patriarchs and the Jewish cemetery in the town.
According to settlers, they were only protecting themselves against rock-throwing by Palestinians, who were placed under curfew by the authorities before the funeral to prevent friction. Eyewitnesses, including foreign press photographers on the scene, reported that the incitement during the funeral march had quickly turned into rock-throwing and a rampage through the open market, where settlers overturned stalls and burned a house. In the chaos, extensive shooting took place, with Israel Defense Forces troops, deployed in large numbers, firing into the air and settlers shooting at buildings. The IDF said no Palestinians had been shooting.
There was extensive shooting at buildings and, according to Palestinian sources, the girl, Nizin Jamjoum, 14, was standing on the balcony of her home when she was fatally shot in the head. Her brother, Marwan, 26, was injured in the incident. At least six more Palestinians had also been injured, doctors at the city's Alia Hospital said.
GAZA, Jul 28, 2002 (Xinhua via COMTEX) -- Israeli attack Apache helicopters fired missiles and heavy ammunition on Sunday at several villages of the West Bank cities of Jenin and Hebron, Palestinian residents said.
They said the Israeli army supported by tanks, armored vehicles and helicopters, raided some houses and farms of the villages of Burqin, Selat Al Dhaher, Zababdeh and Qabatya of the Jenin areas.
The residents in the village of Burqin said the Israeli troops raided the house of Mazen Jaradat, a member of Al Aqsa Martyrs Brigades, a military wing of Palestinian leader Yasser Arafat's Fatah movement, who was killed several months ago in an armed attack against Israel.
After the raid, the soldiers rushed into the house, searched it, and forced several peace movement activists, who were sitting in the house to prevent Israeli army from destroying the house, to leave there.
Palestinian Radio reported that as the Israeli army raided those villages, it imposed curfew on them, adding that at least four Palestinians were arrested during the operation.
Meanwhile, Palestinians said the Israeli army raided the villages of Ithna and Yatta in the areas of Hebron, adding that Israeli troops gathered all males aged from 15 to 50 in the villages, put them in schools and started questioning one by one.
Following two suicide bombing attacks in Jerusalem in June, Israeli army reoccupied most of the West Bank towns and villages that were under the Palestinian control.
After they reoccupied the areas, the Israeli army had kept more than 1 million Palestinians under curfew, and lifted the curfew for a few hours every day to enable the residents to buy food.
NEW YORK -- Of all the bad ideas that have been pouring from the Bush administration - the faux war on terrorism, the Palestine mess, invading Iraq, curtailment of civil liberties, unilateralism, growing deficits, farm subsidies, steel tariffs - among the very worst is the dangerous proposal that U.S. military forces be given domestic police powers.
Bush administration officials, notably the chief of the newly created Northern Command, Gen. Ralph Eberhart, have been calling for the Pentagon to assume a much greater domestic role in the so-called war against terrorism. A role, apparently, that would give the military power to conduct investigations and surveillance, use troops to "maintain order and security" and arrest American citizens. Canadians might be next, since Canada has been involuntarily placed under the U.S. Northern Command.
This frightening plan comes on the heels of Bush's cutely named but sinister TIPs program, a network of citizen informers that recalls evil memories of ubiquitous Soviet and Chinese civilian informers, children denouncing parents, and East Germany, where a quarter of the adult population spied for the Stasi secret police.
In the magisterial Roman Republic, father of all our western democracies, consular armies were forbidden by law to enter the city. The Romans realized over 2,400 years ago that soldiers had to be strictly kept out of politics. The Roman Republic died during the 1st century BC civil wars after military leaders Marius, Sulla and, later, Caesar, brought their armies into politics.
America's Congress - which was patterned on the Roman Senate - clearly recalled this history when it passed the Posse Comitatus Act of 1878 which outlawed the use of federal military forces for domestic law enforcement. Congress was intent on maintaining supremacy of civilian rule and protecting civil liberties. Properly restrained, the military was a useful tool; unrestrained, a dangerous and ruthless master.
“WE lost. They lost. Everyone lost,” the Israeli soldier concludes from on top of his armoured vehicle, waving vaguely at the smoking remains of Jenin behind him. “It’s one of those really original football matches that both teams lose.”
The scene is from Jenin Diary: The Inside Story — a documentary shot by an Israeli reservist from the company that lost 13 soldiers in a Palestinian ambush in Jenin refugee camp on April 9.
Its maker, Gil Mezuman, 30, shot 40 hours of film on a hand-held camera, cut to 65 minutes for its premiere before a capacity audience at the Jerusalem Film Festival.
One of the final scenes shows his disorientated unit wandering aimlessly around its camp, still traumatised after the deaths a few days earlier.
Some of those filmed openly question the tactics used, and even the Army’s right to be in Jenin. Others can no longer fight a campaign in which they no longer believe.
“Personally, I’m finished with the Army. The next reserve call, I won’t be here,” vows ponytailed Altshuler, unable to forgive himself for not challenging the orders that led his commander and friends to their deaths.
Dozens of Israel Defense Force reservists have already joined an initiative to return their reserve identity cards to the army in protest of the government's approval of the Tal Bill last week. Several of them have even sent the cards to Prime Minister Ariel Sharon.
The initiative was started by Noam Peleg, a student from Ra'anana, who serves as a reserve medic in an armor unit. Last week, immediately following the approval of the bill in the Knesset, Peleg sent a letter to Sharon, which was also posted on the Walla internet site.
Peleg said that in light of the bill's approval, which effectively grants most Yeshiva students an exemption from serving in the army, the country had lost its moral right to summon him to reserve duty. He said that he was refusing to go to reserve duty and added his IDF reservist identity card to the envelope with the letter.
Peleg told Ha'aretz on Saturday that he stood behind his words, and said that he would continue to support his position even if the army decided to put him to trial.
The publication of the letter brought forth hundreds of responses from reservists who wanted to join his initiative. So far some 200 of them have said that they intend to send back their cards, and some 20 have already done so. Those who have already joined the petition said that this week they would arrange a mass return of the cards.