Big Banks Take Huge Stakes In Aluminum, Petroleum and Other Physical Markets … Then Manipulate Their Prices

Giant Banks Take Over Real Economy As Well As Financial System … Enabling Manipulation On a Vast Scale

Top economists, financial experts and bankers say that the big banks are too large … and their very size is threatening the economy.  They say we need to break up the big banks to stabilize the economy.  They say that too much interconnectedness leads to financial instability.

But – as shown below – the big banks are getting bigger and bigger … and getting into ever more interconnected markets.

Indeed, big banks aren’t even really acting like banks anymore.  Big banks do very little traditional banking, since most of their business is from financial speculation. For example, we noted in 2010 that less than 10% of Bank of America’s assets come from traditional banking deposits.

The big banks are manipulating every market.   They’re also taking over important aspects of the physical economy, including uranium mining, petroleum products, aluminum, ownership and operation of airports, toll roads, ports, and electricity.

And they are using these physical assets to massively manipulate commodities prices … scalping consumers of many billions of dollars each year. More from Matt Taibbi, FDL and Elizabeth Warren.

A 2-year bipartisan probe by the Senate Permanent Subcommittee on Investigations has shined a light on this problem, culminating in a new 400-page report.

Senator Levin – the Chair of Subcommittee – summarizes the findings from the investigation:

“Wall Street’s massive involvement in physical commodities puts our economy, our manufacturers and the integrity of our markets at risk,” said Sen. Carl Levin, D-Mich., the subcommittee’s chairman. “It’s time to restore the separation between banking and commerce and to prevent Wall Street from using nonpublic information to profit at the expense of industry and consumers.”

“Banks have been involved in the trade and ownership of physical commodities for a number of years, but have recently increased their participation in new ways,” said Sen. John McCain, R-Ariz. “This subcommittee’s hearing is an opportunity to examine that involvement, determine whether it gives rise to excessive risk, and identify potential causes for concern that warrant further oversight by Congress and financial regulators.”

One focus for the subcommittee is the management of Detroit-area metal warehouses run by Metro Trade Services International, the largest U.S. warehouse company certified to store aluminum warranted by the London Metal Exchange for use in settling trades. Since Goldman bought Metro in 2010, Metro warehouses have accumulated up to 85 percent of the U.S. LME aluminum storage market.

Since Goldman took over the warehouses, the wait to withdraw LME-warranted metal has increased from about 40 days to more than 600 days, reducing aluminum availability and tripling the regional premium for storage and delivery costs.

The investigation revealed a number of previously unknown details about these deals: that Goldman’s warehouse company paid metal owners to engage in “merry-go-round” deals that shuttled metal from building to building without actually shipping aluminum out of Metro’s system; that the deals were approved by Metro’s board, which consisted entirely of Goldman employees; and that a Metro executive raised concerns internally about the appropriateness of such “queue management.”

Goldman didn’t just store aluminum; it was involved in massive trades of aluminum at the same time its warehouse operations were affecting aluminum availability, storage costs, and prices. After Goldman bought Metro, it accumulated massive aluminum holdings of its own, and in 2012, added about 300,000 metric tons of its own aluminum to the exit queue at its warehouses.

The Subcommittee investigation also examined other instances of Wall Street bank involvement with physical commodities. The Subcommittee report details how JPMorgan amassed physical commodity holdings equal to nearly 12 percent of its Tier 1 capital, while telling regulators its holdings were far smaller; and that at one point it owned an amount equal to more than half the aluminum used in North America in a year. The report also discloses that, until recently, Morgan Stanley controlled 55 million barrels of oil storage capacity, 100 oil tankers, and 6,000 miles of pipeline, while also working to build its own compressed natural gas facility and supply major airlines with jet fuel.

Details are also provided about Goldman’s ownership of a uranium trading company and two open pit coal mines in Colombia. When one of the mines was shut down last year due to labor unrest, Goldman’s Colombian subsidiary requested military and police assistance to end a human blockade — before paying the miners with $10,000 checks to end the protest.


The findings and recommendations from the bipartisan report are as follows:

Findings of Fact

(1)        Engaging in Risky Activities. Since 2008, Goldman Sachs, JPMorgan Chase, and Morgan Stanley have engaged in many billions of dollars of risky physical commodity activities, owning or controlling, not only vast inventories of physical commodities like crude oil, jet fuel, heating oil, natural gas, copper, aluminum, and uranium, but also related businesses, including power plants, coal mines, natural gas facilities, and oil and gas pipelines.

(2)        Mixing Banking and Commerce. From 2008 to 2014, Goldman, JPMorgan, and Morgan Stanley engaged in physical commodity activities that mixed banking and commerce, benefiting from lower borrowing costs and lower capital to debt ratios compared to nonbank companies.

(3)        Affecting Prices. At times, some of the financial holding companies used or contemplated using physical commodity activities, such as electricity bidding strategies, merry-go-round trades, or a proposed exchange traded fund backed by physical copper, that had the effect or potential effect of manipulating or influencing commodity prices.

(4)        Gaining Trading Advantages. Exercising control over vast physical commodity activities gave Goldman, JPMorgan, and Morgan Stanley access to commercially valuable, non-public information that could have provided advantages in their trading activities.

(5)        Incurring New Bank Risks. Due to their physical commodity activities, Goldman, JPMorgan, and Morgan Stanley incurred multiple risks normally absent from banking, including operational, environmental, and catastrophic event risks, made worse by the transitory nature of their investments.

(6)        Incurring New Systemic Risks. Due to their physical commodity activities, Goldman, JPMorgan, and Morgan Stanley incurred increased financial, operational, and catastrophic event risks, faced accusations of unfair trading advantages, conflicts of interest, and market manipulation, and intensified problems with being too big to manage or regulate, introducing new systemic risks into the U.S. financial system.

(7)        Using Ineffective Size Limits. Prudential safeguards limiting the size of physical commodity activities are riddled with exclusions and applied in an uncoordinated, incoherent, and ineffective fashion, allowing JPMorgan, for example, to hold physical commodities with a market value of $17.4 billion – nearly 12% of its Tier 1 capital – while at the same time calculating the market value of its physical commodity holdings for purposes of complying with the Federal Reserve limit at just $6.6 billion.

(8)        Lacking Key Information. Federal regulators and the public currently lack key information about financial holding companies’ physical commodities activities to form an accurate understanding of the nature and extent of those activities and to protect the markets.

Of course, the Federal Reserve – instead of regulating the banks, encouraged them to buy all of these physical assets. As Reuters notes:

[The Senate report] also points the finger at the Federal Reserve, saying the central bank has taken insufficient steps to address the risks taken by financial holding companies gathering physical commodities. The Fed in some cases was unaware of the growing risk, the report said.

Pam Martens is points out:

Adding to the hubris of the situation, the Wall Street banks’ own regulator, the Federal Reserve, gave its blessing to this unprecedented and dangerous encroachment by banking interests into industrial commodity ownership and has effectively looked the other way as the banks moved into industrial commerce activities like owning pipelines and power plants.


One would think that the mega banks’ regulator, the Federal Reserve, would be the first line of defense against this type of dangerous sprawl by banks. According to the Levin Subcommittee report, the Federal Reserve was actually the facilitator of the sprawl by the banks. The report notes:

“Without the complementary orders and letters issued by the Federal Reserve, many of those physical commodity activities would not otherwise have been permissible ‘financial’ activities under federal banking law. By issuing those complementary orders, the Federal Reserve directly facilitated the expansion of financial holding companies into new physical commodity activities.”

Posted in Business / Economics, Politics / World News | 3 Comments

U.S. & ‘International Banks’ Finance Ukraine’s Civil War

Eric Zuesse

On November 26th, Ukraine’s Prime Minister, Arseniy Yatsenyuk, said, “Our cabinet has resumed the program of activity and cooperation with the International Monetary Fund (IMF), the European Bank for Reconstruction and Development (EBRD) and other banks. Today international investors are not ready to go to the country, but international banks are ready to help us. … We would not have survived without the international assistance.”

In a related news-report, the investigative journalist who goes by the pseudonym “Tyler Durden” headlined at his zero hedge website on November 25th, “Hacked US Documents Said To Reveal Extent Of Undisclosed US ‘Lethal Aid’ For Ukraine Army,” and he posted the documents, which seem authentic, and which include U.S. supplies of “400 sniper-rifles, 2,000 assault-rifles, 720 hand-held grenade launchers, 200 mortars with more than 70,000 mines, 150 stingers, 420 antitank missiles and so on.” Also shown there is an authorization signed by President Obama authorizing the U.S. Secretary of State, to “direct the drawdown of up to $5 million in defense articles and services of the Department of Defense and military education and training to provide immediate military assistance for the Government of Ukraine, to aid their efforts to respond to the current crisis,” and “to direct the drawdown of up to $20 million in nonlethal commodities and services from any agency of the United States Government,” for the same purpose.

The lethal aid had not previously been reported, except in rebel-produced videos of the war (such as this), claiming, and sometimes showing, U.S. weapons used against them on the battlefield. However, those rebels are using Russian-made weapons, though some of those come from the defeated forces on the opposite side. This is not only a civil war within Ukraine; it is also an international proxy war between NATO and Russia.

Those reports of U.S. involvement on the side of nazis are generally not mentioned in Western news-media, because they don’t come from Western news-media, and the West is backing this war against the rebel-areas. However, some Western news-media have documented the heavy involvement of racist-fascist, or nazi, leadership and battalions in the military of the Ukrainian Government after the overthrow of the former Ukrainian President, Viktor Yanukovych, which occurred in February of this year. Some former U.S. intelligence professionals have even written publicly about it. The resistance fighters in Ukraine claim that the current Ukrainian Government is controlled by nazis whose hatred is directed against ethnic Russians, but Ukraine’s officials deny that they are nazis.


Investigative historian Eric Zuesse is the author, most recently, of  They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010,  and of  CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.

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There Goes Virginia’s Climate

A snowstorm is the ideal time to write about climate disruption, as it allows us to immediately set-aside the cartoonish claim that if any spot on earth isn’t warmer than it was yesterday then all is well. The following things we know:

There are giant snowflakes falling outside my window.

Five-year averages of temperature in Virginia began a significant and steady increase in the early 1970s, rising from 54.6 degrees Fahrenheit then to 56.2 degrees F in 2012.

The Piedmont area, where I live, has seen the temperature rise at a rate of 0.53 degrees F per decade.

At this rate, Virginia will be as hot as South Carolina by 2050 and as northern Florida by 2100, and continuing at a steady or increasing pace from there.

Sixty percent of Virginia is forest, and forests cannot evolve or switch over to warmer-weather species at anything like that fast a pace. The most likely future is not pines or palm trees but wasteland.

From 1979 to 2003, excessive heat exposure contributed to over 8,000 premature deaths in the United States, more than all deaths from hurricanes, lightning, tornadoes, floods, and earthquakes combined, and dramatically more than all deaths from terrorism.

Between 1948 and 2006 “extreme precipitation events” have increased 25% in Virginia. Precipitation in Virginia is likely to increase or decrease dramatically overall, and is extremely likely to continue the trend of arriving in ever more intense bursts of storms interrupting droughts. This will be devastating to agriculture.

Acidity in the ocean has already increased by 30 percent and if current trends continue will hit a 100 to 150 percent increase by 2100 and continue to spiral upward from there. Oysters’ shells in the Chesapeake Bay have grown thinner as a result. The oyster population is 98 percent gone. Shell fish are becoming and will entirely become extinct, if current trends remain unaltered. By 2100 we can expect 60 to 100 percent of the world’s coral reefs to be gone.

Fish off the Virginia coast are moving north and east to survive, some species having already vanished from Virginia waters either by migrating or dying out. In Virginia 46 percent of fish species, 25 percent of birds, 46 percent of reptiles, 43 percent of amphibians, and 28 percent of mammals are listed as threatened or endangered.

Seventy-eight percent of Virginians live within 20 miles of the Chesapeake, the Atlantic, or tidal rivers. On the Eastern Shore and in the Hampton Roads-Norfolk area, flooding has already become routine. The sea level will rise, if current trends continue, between 3 and 18 feet by 2100. Already it has risen an inch every 7 or 8 years — 12 inches in the last century. Some 628,000 Virginians live within 6.5 feet of sea level. Paul Fraim, Mayor of Norfolk since 1994, says the city may need to soon establish “retreat zones” and abandon sections of the city as too costly to protect. Real estate agents are discussing the need to require disclosure of sea level as well as lead paint and other defects when selling property.

The famous ponies of Chincoteague live among trees killed and grasses weakened by risen saltwater, and will not live there much longer.

The U.S. military, headquartered largely in Virginia, the world’s largest Navy base in Norfolk, and the swamp-built Capital of the United States in Washington, D.C., face potential devastation directly contributed to by the endless wars for oil, and the consumption of that oil, despite the widespread belief that the results of the wars are distant. Just as ice melting in Greenland lifts water onto the streets of Norfolk, investment of trillions of dollars in pointless death and destruction not only diverts resources from addressing climate damage but heavily contributes to that damage. The U.S. military would rank 38th in oil consumption if it were a nation.

If any image can wallop someone with the need to adjust our priorities it is one of Wallops Island just south of Chincoteague but protected for the moment by a $34 million rock wall.  Wallops Island hosts tests for the $4 billion crash-prone Osprey helicopter, and all sorts of war training, plus a space port from which multi-billionaires can blow themselves up or launch themselves into space to starve in tin cans literally as well as subjectively above the rest of us.

There is no Planet B. Nobody has found anywhere for humans to live apart from earth, at least not remotely in the time frame of the current crisis.

Virginia has taken in thousands of refugees from Hurricane Katrina and can expect to take in many more and to create many refugees itself. The only thinking that says every future Hurricane Sandy will miss Virginia is wishful thinking.

The warming will bring the mosquito varieties (already arriving) and diseases. Serious risks include malaria, Chagas disease, chikungunya virus, and dengue virus. Look them up. The television won’t explain them until they’re here.

Virginians, like others in the United States, consume vastly more energy and produce vastly more warming per capita than do people in other countries, including countries in Europe that they don’t look down on. Proposals to actually halt the climate catastrophe generally call for Americans to start living like Europeans (the horror!).

Virginia’s Constitution requires the state to “protect its atmosphere, lands, and waters from pollution, impairment, or destruction, for the benefit, enjoyment and general welfare of the people.” In a decent court system, any member of the public could have that enforced through a massive emergency Marshall-Plan effort to preserve our climate.

Virginia’s Department of Environmental Quality does not concern itself with climate change.

Virginia lags significantly behind Maryland and North Carolina in addressing climate change.

Numerous reasonable steps can be quite easily taken if the political will is found, but they get harder with each passing year.

The financial corruption of state governments is not nearly as advanced as at the federal level, although some states lag behind the national average in intellectual awareness and enlightenment. The possibility certainly exists for Virginia to compete with Germany and Scandinavia in renewable energy, recycling, and reduced consumption.

If the day after being thankful for things, Virginians rush out to stores and buy crap, rather than rushing out to organize actions to save the climate, we will need to all be thankful we are not our kids or our grandkids. “Here’s a plastic toy. Glad I’m not you!”

Apart from the snow outside my window and a few odd remarks like “stop shopping!” everything stated above is well documented in a new book called Virginia Climate Fever by Stephen Nash, for which I am thankful and which I hope every Virginian reads before New Year’s resolution time.

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The American Dream Has Moved to Scandinavia

“Rags to Riches” Much Easier In Scandinavia than America

We noted in 2010 that the American Dream – the possibility of a “rags to riches” success story – has moved abroad … since social mobility in the U.S. is much lower than in many other developed nations.

(And we pointed out that conservatives are as disturbed as liberals by the collapse of social mobility in modern America.)

A paper published last year by University of Ottawa economics professor Miles Corak tells us exactly where the American Dream has gone … to Scandinavia.  Here’s a chart from the study:

Denmark, Norway and Finland have the most social mobility (and Sweden is not that far behind).

On the other hand, the UK, Italy and America have the least social mobility.

True, the UK and Italy are a tiny bit worse than the U.S. in terms of social mobility.  But the U.S. has the most inequality.  Indeed, the U.S. arguably has the worst inequality anywhere in the world at any time in history. Indeed, inequality is so severe in America that most of the profits are flowing into the hands of an incredibly small group of people … and you’re not very likely to become one of them.

On the other hand, Sweden, Finland, Denmark and Norway have the least inequality. In other words, it’s a lot more likely that you can get a reasonable slice of the pie there.

Indeed, Norway is arguably the world’s most prosperous country. Denmark is 4th; Sweden is 6th; and Finland is 8th … but the U.S. has dropped down to 10th place.

The American Dream is now spoken with a Scandinavian accent.

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WSJ Reports: Bank of North Dakota Outperforms Wall Street

Guest post by Ellen Brown.

While 49 state treasuries were submerged in red ink after the 2008 financial crash, one state’s bank outperformed all others and actually launched an economy-shifting new industry.  So reports the Wall Street Journal this week, discussing the Bank of North Dakota (BND) and its striking success in the midst of a national financial collapse led by the major banks. Chester Dawson begins his November 16th article:

It is more profitable than Goldman Sachs Group Inc., has a better credit rating than J.P. Morgan Chase & Co. and hasn’t seen profit growth drop since 2003. Meet Bank of North Dakota, the U.S.’s lone state-owned bank, which has one branch, no automated teller machines and not a single investment banker.

He backs this up with comparative data on the BND’s performance:

[I]ts total assets have more than doubled, to $6.9 billion last year from $2.8 billion in 2007. By contrast, assets of the much bigger Bank of America Corp. have grown much more slowly, to $2.1 trillion from $1.7 trillion in that period.

. . . Return on equity, a measure of profitability, is 18.56%, about 70% higher than those at Goldman Sachs and J.P. Morgan. . . .

Standard & Poor’s Ratings Services last month reaffirmed its double-A-minus rating of the bank, whose deposits are guaranteed by the state of North Dakota. That is above the rating for both Goldman Sachs and J.P. Morgan and among U.S. financial institutions, second only to the Federal Home Loan Banks, rated double-A-plus.

Dawson goes on, however, to credit the BND’s remarkable performance to the Bakken oil boom. Giving his article the controversial title, “Shale Boom Helps North Dakota Bank Earn Returns Goldman Would Envy: U.S.’s Lone State-Owned Bank Is Beneficiary of Fracking,” he contends:

The reason for its success? As the sole repository of the state of North Dakota’s revenue, the bank has been one of the biggest beneficiaries of the boom in Bakken shale-oil production from hydraulic fracturing, or fracking. In fact, the bank played a crucial part in kick-starting the oil frenzy in the state in 2008 amid the financial crisis.

That is how the Wall Street-owned media routinely write off the exceptional record of this lone publicly-owned bank, crediting it to the success of the private oil industry. But the boom did not make the fortunes of the bank. It would be more accurate to say that the bank made the boom.

Excess Deposits Do Not Explain the BND’s Record Profits

Dawson confirms that the BND played a crucial role in kickstarting the boom and the economy, at a time when other states were languishing in recession. It did this by lending for critical infrastructure (roads, housing, hospitals, hotels) when other states’ banks were curtailing local lending.

But while the state itself may have reaped increased taxes and fees from the oil boom, the BND got no more out of the deal than an increase in deposits, as Dawson also confirms. The BND is the sole repository of state revenues by law.

Having excess deposits can hardly be the reason the BND has outdistanced even JPMorganChase and Bank of America, which also have massive excess deposits and have not turned them into loans. Instead, they have invested their excess deposits in securities.

Interestingly, the BND has also followed this practice. According to Standard & Poor’s October 2014 credit report, it had a loan to deposit ratio in 2009 of 91%. This ratio dropped to 57.5% in 2014. The excess deposits have gone primarily into Treasuries, US government agency debt, and mortgage-backed securities. Thus the bank’s extraordinary profitability cannot be explained by an excess of deposits or an expanded loan portfolio.

Further eroding the Dawson explanation is that the oil boom did not actually hit North Dakota until 2010. Yet it was the sole state to have escaped the credit crisis by the spring of 2009, when every other state’s budget had already dipped into negative territory. Montana, the runner-up, was in the black by the end of 2009; but it dropped into the red in March of that year and had to implement a pay freeze on state employees.

According to Standard & Poor’s, the BND’s return on equity was up to 23.4% in 2009 – substantially higher than in any of the years of the oil boom that began in 2010.

The Real Reasons for Its Stellar Success

To what, then, are the remarkable achievements of this lone public bank attributable?

The answer is something the privately-owned major media have tried to sweep under the rug: the public banking model is simply more profitable and efficient than the private model. Profits, rather than being siphoned into offshore tax havens, are recycled back into the bank, the state and the community.

The BND’s costs are extremely low: no exorbitantly-paid executives; no bonuses, fees, or commissions; only only one branch office; very low borrowing costs; and no FDIC premiums (the state rather than the FDIC guarantees its deposits).

These are all features that set publicly-owned banks apart from privately-owned banks. Beyond that, they are safer for depositors, allow public infrastructure costs to be cut in half, and provide a non-criminal alternative to a Wall Street cartel caught in a laundry list of frauds.

Dawson describes some other unique aspects of the BND’s public banking model:

It traditionally extends credit, or invests directly, in areas other lenders shun, such as rural housing loans.

. . . [R]etail banking accounts for just 2%-3% of its business. The bank’s focus is providing loans to students and extending credit to companies in North Dakota, often in partnership with smaller community banks.

Bank of North Dakota also acts as a clearinghouse for interbank transactions in the state by settling checks and distributing coins and currency. . . .

The bank’s mission is promoting economic development, not competing with private banks. “We’re a state agency and profit maximization isn’t what drives us,” President Eric Hardmeyer said.

. . . It recently started offering mortgages to individuals in the most underserved corners of the state. But Mr. Hardmeyer dismisses any notion the bank could run into trouble with deadbeat borrowers. “We know our customers,” he said. “You’ve got to understand the conservative nature of this state. Nobody here is really interested in making subprime loans.”

The Downsides of a Boom

The bank’s mission to promote economic development could help explain why its return on equity has actually fallen since the oil boom hit in 2010. The mass invasion by private oil interests has put a severe strain on the state’s infrastructure, forcing it to muster its resources defensively to keep up; and the BND is in the thick of that battle.

In an August 2011 article titled “North Dakota’s Oil Boom is a Blessing and a Curse”, Ryan Holeywell writes that virtually all major infrastructure in the boom cities and counties is strained or exhausted. To shore up its infrastructure needs, the state has committed hundreds of millions of dollars in revenue. Meanwhile, it is trying to promote industries other than oil and gas, such as companies involved with unmanned aircraft, manufacturing associated with wind energy equipment, and data centers; but the remoteness of the western part of the state, along with the high cost of labor, makes doing business there complicated and expensive.

Hydrofracking, which has been widely attacked as an environmental hazard, is not as bad in North Dakota as in other states, since the process takes place nearly two miles underground; but it still raises significant environmental concerns. In 2011, the state levied $3 million in fines against 20 oil companies for environmental violations. It also undertook a review of industry regulations and was in the process of doubling its oil field inspectors.

The greatest stresses from the oil industry, however, involve the shortage of housing and the damage to the county road system, which in many places consists of two-lane gravel and dirt roads. Drilling a new well requires more than 2,000 truck trips, and the heavy rigs are destroying the roads. Fixing them has been estimated to require an investment of more than $900 million over the next 20 years.

These are external costs imposed by the oil industry that the government has to pick up. All of it requires financing, and the BND is there to provide the credit lines.

Lighting a Fire under Legislators

What the Bank of North Dakota has done to sustain its state’s oil boom, a publicly-owned bank could do for other promising industries in other states. But Dawson observes that no other state has yet voted to take up the challenge, despite a plethora of bills introduced for the purpose. Legislators are slow to move on innovations, unless a fire is lit under them by a crisis or a mass popular movement.

We would be better off sparking a movement than waiting for a crisis. The compelling data in Dawson’s Wall Street Journal article, properly construed, could add fuel to the flames.


Ellen Brown is an attorney, founder of the Public Banking Institute, and author of twelve books, including the best-selling Web of Debt. In The Public Bank Solution, her latest book, she explores successful public banking models historically and globally. Her 200+ blog articles are at

Posted in Business / Economics, Politics / World News | 8 Comments

Follow The Sand To The Real Fracking Boom

When it takes up to four million pounds of sand to frack a single well, it’s no wonder that demand is outpacing supply and frack sand producers are becoming the biggest behind-the-scenes beneficiaries of the American oil and gas boom.

Demand is exploding for “frac sand”–a durable, high-purity quartz sand used to help produce petroleum fluids and prop up man-made fractures in shale rock formations through which oil and gas flows—turning this segment into the top driver of value in the shale revolution.

“One of the major players in Eagle Ford is saying they’re short 6 million tons of 100 mesh alone in 2014 and they don’t know where to get it. And that’s just one player,” Rasool Mohammad, President and CEO of Select Sands Corporation told

Frack sand exponentially increases the return on investment for a well, and oil and gas companies are expected to use some 95 billion pounds of frack sand this year, up nearly 30% from 2013 and up 50% from forecasts made just last year.

Pushing demand up is the trend for wider, shorter fracs, which require twice as much sand. The practice of downspacing—or decreasing the space between wells—means a dramatic increase in the amount of frac sand used. The industry has gone from drilling four wells per square mile to up to 16 using shorter, wider fracs. In the process, they have found that the more tightly spaced wells do not reduce production from surrounding wells.

This all puts frac sand in the drivers’ seat of the next phase of the American oil boom, and it’s a commodity that has already seen its price increase up to 20% over the past year alone.

Frac sand is poised for even more significant gains over the immediate term, with long-term contracts locking in a lucrative future as exploration and production companies experiment with using even more sand per well.

Pioneer Natural Resources Inc. (NYSE:PXD) says the output of wells is up to 30% higher when they are blasted with more sand.

Citing RBC Capital Markets, The Wall Street Journal noted that approximately one-fifth of onshore wells are now being fracked with extra sand, while the trend could spread to 80% of all shale wells.

Oilfield services giants such as Halliburton Co. (NYSE:HAL) and Baker Hughes Inc. (NYSE:BHI) are stockpiling sand now, hoping to shield themselves from rising costs of the high-demand product, according to a recent Reuters report. They’re also buying more sand under contract—a trend that will lead to more long-term contracts and a longer-term boost for frac sand producers.

In this environment, the new game is about quality and location.

Frac sand extraction could spread to a dozen US states that have largely untapped sand deposits, but the biggest winners will be the biggest deposits that are positioned closest to major shale plays such as Eagle Ford, the Permian Basin, Barnett, Haynesville and the Tuscaloosa marine shale play.

The state of Wisconsin has been a major frac sand venue, with over 100 sand mines, loading and processing facilities permitted as of 2013, compared to only five sand mines and five processing plants in 2010.

But with the surge in demand for this product, companies are looking a bit closer to shale center to cut down on transportation costs and improve the bottom line.

One of the hottest new frac sand venues is in Arkansas’ Ozark Mountains, which is not only closer by half to the major shale plays, saving at least 25% per ton on transportation costs, but also allows for year-round production that will fill the gap in shortages when winter prevents mining in northern states.

“In the southern US, we can operate year round, so there is no fear of a polar vortex like that we saw last year with some other producers,” says Mohammad of Select Sands.

Chicago-based consulting company Professional Logistics Group Inc. found in 2012 that transportation represented 58% of the cost of frac sand, while Select Sands, estimates the costs between 66-75% today.

The competition is stiff, but this game is still unfolding, while increased demand is reshaping the playing field.

US Silica Holdings Inc. says demand for its own volumes of sand could double or triple in the next five years, and its three publicly-traded rivals—Emerge Energy Services (NYSE:EMES), Fairmount Santrol (NYSE:FMSA) and Hi-Crush Partners (NYSE:HCLP), have also made strong Wall Street debuts over the past two years.


By. James Stafford of

Posted in Business / Economics, Energy / Environment, General | 1 Comment

France Will Renege on Russian Contract, Says Pres. Francois Hollande

Eric Zuesse

On November 25th, French President Francois Hollande announced that France, which has already missed two deadlines to deliver to Russia two completed Mistral helicopter-carriers to Russia, won’t deliver either ship until Washington has no further complaints about Russia’s support of breakaway rebels in Ukraine’s southeast. Russia had already “mostly paid for” both of these ships, though details of the deal and prepayment have not been made public. Only the delivery is at issue here. Non-delivery by France would also raise a possible charge of theft against France, because, according to Russia’s Deputy Prime Minister Dmitry Rogozin, one-third of the ship is Russian-made, and, “The stern section of Mistral was made at Baltic Shipyard in St. Petersburg. That is why if they want to keep the ship, we will have to tear away its stern section and get it back to use it in other ships,” and that scenario is out of the question. Yet some in the U.S. Congress are demanding it, and suggest that “NATO could buy or lease them as a shared alliance asset,” though the ships were made according to Russian specifications and don’t meet NATO’s.

The Russian Government says that if the matter extends beyond a third deadline at the end of this month, and the first ship is still not delivered, then Russia will activate the non-delivery penalty for that ship, which, according to the BBC, would be around a billion dollars.

Hollande has been under terrific pressure from President Obama to renege on the contract, but French shipyard workers and others have held public demonstrations for France to honor the contract, because of the extensive harm to French shipbuilding and other industry that would result from France’s reneging on an international contract: it would hurt all of French industry if the French Government were to prohibit contract-fulfillment over political differences.

The French President has, evidently, chosen the American President over his own country, but the penalty lawsuit from Russia will probably drag on for a long time, because Hollande used careful terminology in his renege-statement: he has “indefinitely suspended” delivery, not “cancelled” it. Consequently, the question as to precisely when France would “renege,” and would consequently be in technical default on the deal, would need to be adjudicated.

Russia says that they don’t urgently need these ships, and can continue on for a few more years with their existing carrier-set-up while they build their own ships to replace the two made-to-order Mistrals. In that eventuality, France’s penalties on both ships could amount to nearly enough to pay Russia to build their own carriers, so that Russia could end up getting both new ships, of Russia’s own manufacture, at little or no cost. This might be a French gift to Russia, but it would hurt France’s commercial reputation even more than the penalties would be costing France.

The U.S. news media have widely condemned France for not having earlier said that they would renege on this deal. For example, a Republican, anti-Obama, columnist for the Washington Post said that “France’s attempt to sell warships to Russia is both a ‘sell the rope to hang themselves’ moment and a comment on U.S. stature these days.” (She didn’t notice that the ships had already been sold and paid-for.) If President Hollande goes through with his stated intention to “indefinitely suspend” delivery, then perhaps he will win some new fans in the United States, but it probably wouldn’t do anything to win President Obama any new Republican friends. Nothing that Obama has done thus far has won him support from Republicans. France’s President isn’t likely to win their support, either; but, like Obama, Hollande seems to be trying hard to win it, no matter what French laborites and industrialists might wish.

Obama doesn’t possess much clout among Republicans, but he still has lots of clout among some other world-leaders, for reasons which aren’t entirely clear, but for which France, in particular, could pay dear.


Investigative historian Eric Zuesse is the author, most recently, of  They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010,  and of  CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.








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MLK, Jr: Riot is the Language of the Unheard

And I must say tonight that a riot is the language of the unheard. And what is it America has failed to hear? It has failed to hear that the plight of the negro poor has worsened over the last twelve or fifteen years. It has failed to hear that the promises of freedom and justice have not been met. And it has failed to hear that large segments of white society are more concerned about tranquility and the status quo than about justice and humanity.

Martin Luther King, Jr

Corporate news outlets casually refer to protesters in Hong Kong, Ukraine (or anywhere protests occur outside the US empire) as “pro-democracy protesters”, and other positively charged terms.

When people protest in ways that could serve to expand US hegemony, US agencies even provide material, political, and violent support, despite Lyndon Johnson having implicitly admitted the compromising nature of doing this when he said, of anti-Vietnam-invasion protests, “Get me some commie money and organizers behind this student shit”.  He understood that exposing, or in his case lying about, foreign money behind protests was a way to try to discredit them.

In the case of the Ferguson protests, they have no foreign motivation.  They are part of a process that began when slaves were brought to this land by white fascists and used against their will to help exterminate the indigenous peoples who had lived here for thousands of years, and to help, also against their will and for no pay, establish the US economic base.

In the mid 1800s, the US “supreme court” (these names always remind me of KKK terms like “grand high dragon”) officially determined and ruled into US law that blacks were sub-humans and slavery was for their benefit.  (Dred Scott)  The sentiment is common by exploiters, and was similar to when the colonists had earlier stated that they were helping the Native Americans, when in fact they would probably not have survived even the first winter if it were not for the Natives helping them.

Even when slavery was “officially” ended after the Civil War, it continued, as being black in America was essentially outlawed so that blacks could be imprisoned and still used as virtual slave labor, a practice which continues today in a prison system that disproportionately targets people of darker complexion (as, by extension does the US/western led international “justice” system, which focuses mainly on Africans).

Harsh de jure segregation existed on the books until very recently, in both the North and South.  One documentary I recently viewed showed the government mandated racism during WW2.  To the dismay of dedicated black fighters, German POWs were treated better than blacks fighting on the US side – both volunteers and conscripts – simply because of the Germans’ white complexion.

At that time, there were massive KKK marches in DC.  Lynchings were so common and “legal” segregation was so harsh that 20% of blacks said they thought they would fare as well under Hitler as in the USA.  Lynchings occurred in the North and South.  They were joyous affairs in which entire towns would participate.  Kids would be pulled from school to watch, and people would take parts of the black person’s body – ears, noses, etc. – as mementos.

The racist Jim Crow laws were official US policy until 1965.  They “mandated the segregation of public schools, public places and public transportation, and the segregation of restrooms, restaurants and drinking fountains for whites and blacks. The U.S. military was also segregated, as were federal workplaces, initiated in 1913 under President Woodrow Wilson, the first Southern president since 1856. His administration practiced overt racial discrimination in hiring, requiring candidates to submit photos.”

It can’t possibly come as a surprise that such racism would not simply disappear.  Equal treatment under the law remains illusive.  Progress has been hard-won in the streets, and will continue to be pushed forward.

If anyone can find an example of a mainstream US news outlet referring to Ferguson protesters as “pro-democracy” or even “pro-justice”, “pro-equality”, or “pro-civil rights”, etc., please comment. 

Also please note it is not this author’s goal, while discussing extremely prevalent institutional and moral problems, to stereotype lawmakers or law enforcers as bad and/or racist.   

Robert Barsocchini is a researcher focusing on global force dynamics.  He also writes professionally for the film industry.  Here is his blog.  Also see his free e-book, Whatever it Takes – Hillary Clinton’s Record of Support for War and other Depravities.  Click here to follow Robert and his UK-based colleague, Dean Robinson, on Twitter.

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The REAL Looting Is Happening On Wall Street … Not In Ferguson


Images by William Banzai

Who Are the Worst Looters?

The looting in Ferguson, Missouri is bad.    The looters are giving the peaceful protesters against the shooting of Michael Brown a bad name, and provoking an armed (and over-militarized) response by the police.

But let’s put things in perspective …

Wall Street’s crimes and fraud have cost the economy tens of trillions of dollars.

The big banks are still engaged mind-blowing levels of manipulation and crime.

Nobel prize winning economist Joe Stiglitz and well-known economist Nouriel Roubini say that we’ve got to jail – or perhaps even hang – some bankers before they’ll stop looting the economy.

Nobel prize winning economist George Akerlof has demonstrated that failure to punish white collar criminals – and instead bailing them out- creates incentives for more economic crimes and further destruction of the economy in the future.

We explained in 2009:

As pointed out in May (it is worth quoting the essay at some length, as this is an important concept), looting has replaced free market capitalism:

Nobel prize-winning economist George Akerlof co-wrote a paper in 1993 describing the causes of the S&L crisis and other financial meltdowns. As summarized by the New York Times:

In the paper, they argued that several financial crises in the 1980s, like the Texas real estate bust, had been the result of private investors taking advantage of the government. The investors had borrowed huge amounts of money, made big profits when times were good and then left the government holding the bag for their eventual (and predictable) losses.

In a word, the investors looted. Someone trying to make an honest profit, Professors Akerlof and Romer [co-author of the paper, and himself a leading expert on economic growth] said, would have operated in a completely different manner. The investors displayed a “total disregard for even the most basic principles of lending,” failing to verify standard information about their borrowers or, in some cases, even to ask for that information.

The investors “acted as if future losses were somebody else’s problem,” the economists wrote. “They were right.”

The Times does a good job of explaining the looting dynamic:

The paper’s message is that the promise of government bailouts isn’t merely one aspect of the problem. It is the core problem.

Promised bailouts mean that anyone lending money to Wall Street — ranging from small-time savers like you and me to the Chinese government — doesn’t have to worry about losing that money. The United States Treasury (which, in the end, is also you and me) will cover the losses. In fact, it has to cover the losses, to prevent a cascade of worldwide losses and panic that would make today’s crisis look tame.

But the knowledge among lenders that their money will ultimately be returned, no matter what, clearly brings a terrible downside. It keeps the lenders from asking tough questions about how their money is being used. Looters — savings and loans and Texas developers in the 1980s; the American International Group, Citigroup, Fannie Mae and the rest in this decade — can then act as if their future losses are indeed somebody else’s problem.

Do you remember the mea culpa that Alan Greesnspan, Mr. Bernanke’s predecessor, delivered on Capitol Hill last fall? He said that he was “in a state of shocked disbelief” that “the self-interest” of Wall Street bankers hadn’t prevented this mess.

He shouldn’t have been. The looting theory explains why his laissez-faire theory didn’t hold up. The bankers were acting in their self-interest, after all…Think about the so-called liars’ loans from recent years: like those Texas real estate loans from the 1980s, they never had a chance of paying off. Sure, they would deliver big profits for a while, so long as the bubble kept inflating. But when they inevitably imploded, the losses would overwhelm the gains…

What happened? Banks borrowed money from lenders around the world. The bankers then kept a big chunk of that money for themselves, calling it “management fees” or “performance bonuses.” Once the investments were exposed as hopeless, the lenders — ordinary savers, foreign countries, other banks, you name it — were repaid with government bailouts.

In effect, the bankers had siphoned off this bailout money in advance, years before the government had spent it…Either way, the bottom line is the same: given an incentive to loot, Wall Street did so. “If you think of the financial system as a whole,” Mr. Romer said, “it actually has an incentive to trigger the rare occasions in which tens or hundreds of billions of dollars come flowing out of the Treasury.”

In fact, the big banks and sellers of exotic instruments pretended that the boom would last forever, siphoning off huge profits during the boom with the knowledge that – when the bust ultimately happened – the governments of the world would bail them out.

As Akerlof wrote in his paper:

[Looting is the] common thread [when] countries took on excessive
foreign debt, governments had to bail out insolvent financial institutions, real estate prices increased dramatically and then fell, or new financial markets experienced a boom and bust…Our theoretical analysis shows that an economic underground can come to life if firms have an incentive to go broke for profit at society’s expense (to loot) instead of to go for broke (to gamble on success). Bankruptcy for profit will occur if poor accounting, lax regulation, or low penalties for abuse give owners an incentive to pay themselves more than their firms are worth and then default on their debt obligations.

Indeed, Akerlof predicted in 1993 that the next form the looting dynamic would take was through credit default swaps – then a very-obscure financial instrument (indeed, one interpretation of why CDS have been so deadly is that they were the simply the favored instrument for the current round of looting).

Is Looting A Thing of the Past?

Now that Wall Street has been humbled by this financial crash, and the dangers of CDS are widely known, are we past the bad old days of looting?

Unfortunately, as the Times points out, the answer is no:

At a time like this, when trust in financial markets is so scant, it may be hard to imagine that looting will ever be a problem again. But it will be. If we don’t get rid of the incentive to loot, the only question is what form the next round of looting will take.

Indeed, one of America’s top experts on white collar fraud – the senior S&L prosecutor who put more than 1,000 top executives in jail for fraud (Bill Black)- says that we’ve known for “hundreds of years” that failure to punish white collar criminals creates incentives for more economic crimes and further destruction of the economy in the future. And see this, this, this and this.

Review of the data on accounting fraud confirms that fraud goes up as criminal prosecutions go down. Indeed, extensive evidence shows that failing to prosecute looting by Wall Street is killing our economy.

And yet the U.S. government admits that it refuses to prosecute fraud … pretty much as an official policy. Indeed, the government helped cover up the crimes of the big banks, used claims of national security to keep everything in the dark, and changed basic rules and definitions to allow the game to continue. See this, this, this and this.

Indeed, Wall Street – with the help of Washington – has robbed (and raped) America.

The Fish Is Rotting from the Head Down

Moreover, corruption at the top leads to lawlessness by the people. As we noted in 2011, in the middle of the London riots:

Corruption and lawlessness by our “leaders” encourages lawlessness by everyone else. See this, for example.

Peter Oborne – the Daily Telegraph’s chief political commentator – wrote yesterday:

The criminality in our streets cannot be dissociated from the moral disintegration in the highest ranks of modern British society. The last two decades have seen a terrifying decline in standards among the British governing elite. It has become acceptable for our politicians to lie and to cheat. An almost universal culture of selfishness and greed has grown up.

It is not just the feral youth of Tottenham who have forgotten they have duties as well as rights. So have the feral rich ….


The so-called feral youth seem oblivious to decency and morality. But so are the venal rich and powerful – too many of our bankers, footballers, wealthy businessmen and politicians.


The sad young men and women, without hope or aspiration … have caused such mayhem and chaos over the past few days. But the rioters have this defence: they are just following the example set by senior and respected figures in society. Let’s bear in mind that many of the youths in our inner cities have never been trained in decent values. All they have ever known is barbarism. Our politicians and bankers, in sharp contrast, tend to have been to good schools and universities and to have been given every opportunity in life.

Something has gone horribly wrong in Britain. If we are ever to confront the problems which have been exposed in the past week, it is essential to bear in mind that they do not only exist in inner-city housing estates.

The culture of greed and impunity we are witnessing on our TV screens stretches right up into corporate boardrooms and the Cabinet. It embraces the police and large parts of our media. It is not just its damaged youth, but Britain itself that needs a moral reformation.

Osborne also gives specific examples of corruption, such as the prime minister’s involvement in the Murdoch scandal, and members of parliament abusing expense accounts.

Indeed, the rioters themselves agreed. As Reuters notes:

Speaking to Reuters late on Tuesday, looters and other local people in east London pointed to the wealth gap as the underlying cause, also blaming what they saw as police prejudice and a host of recent scandals.

Spending cuts were now hitting the poorest hardest, they said, and after tales of politicians claiming excessive expenses, alleged police corruption and bankers getting rich it was their turn to take what they wanted.

They set the example,” said one youth after riots in the London district of Hackney. “It’s time to loot.”

As Max Keiser noted at the time, harshly cracking down on British youth looting a $1 bottle of water or a candy bar while letting the financial looters go free is hypocritical.

As we noted in 2011, failing to prosecute financial fraud – on either side of the Atlantic – is extending the economic crisis. In 2012, we pointed out that European (and American) governments were encouraging bank manipulation and fraud to cover up insolvency … trying to put lipstick on a pig.

As a result, Europe is still in a depression … and America has the highest levels of inequality in history. And that’s killing our economy.

Postscript: Perverse money incentives are what led to the distrust in  Ferguson police in the first place.

Posted in Business / Economics, Politics / World News | 4 Comments

Nothing Has Changed–and That’s the Problem

Playing monetary games has done nothing to eliminate moral hazard.

If we step back and look at the past six years since the global financial meltdown of 2008, we see that in terms of financial and political power, nothing has changed–and that’s the problem. If nothing has changed structurally, then none of the problems that caused the meltdown have truly been addressed.

All that’s changed is the vast expansion of monetary games has masked the dysfunctional reality that the same old vested interests that had a death-grip on wealth and power in 2008 have tightened their death-grip in the past six years.

Here’s the problem facing every nation and trading bloc:

1. Vested interests institutionalized moral hazard, separating their gains from the consequences of taking risks. This is also known as privatized gains, socialized losses: vested interests reaped the gains from risky speculative bets, but then passed the staggering losses onto the central banks and taxpayers while keeping the gains.

2. The vested interests control the machinery of governance, so there is no way the central state will force the vested interests to absorb the losses that are rightfully theirs. Instead of de-institutionalizing moral hazard, governments have spewed thousands of pages of complicated regulations, in effect, grudgingly nudging the barn door half-closed after the horses of systemic risk galloped away in 2008.

3. With moral risk still institutionalized, nothing has changed: all the gains from subprime auto loans, selling sovereign bonds issued by insolvent governments, etc., are private, and all the risk is being transferred to the central banks and taxpayers.

The money-printing of quantitative easing–central banks printing money to purchase sovereign bonds and mortgages–is actually a form of money-laundering, as all this expansion of central bank balance sheets, debt and liquidity enables the vested interests to expand their control of the financial and political power centers at the expense of everyone else.

Take a look at the vast expansion of debt and the modest impact of that debt on GDP:

Look at the unprecedented expansion of the Fed’s balance sheet and ask cui bono– to whose benefit?

Since moral hazard–the disconnect of risk and consequence–is the fundamental cause of the global meltdown of 2008, the only solution is to eliminate moral hazard. By this I mean de-institutionalizing moral hazard.

But de-institutionalizing moral hazard means smashing the vested interests’ primary engine of wealth and political power.

The only way forward is to assign the losses that have been piled up in the shadows to those who created and bought the risk for their own gain. That means the investment banks that originated the subprime mortgages and auto loans, etc., and the mutual funds, pension funds, wealth funds, etc. that bought them as “low-risk” investments.

Right now, we’re bailing out the con-artists (the banks) and their credulous marks– the suckers who foolishly trusted the grifters of Wall Street, London, Shanghai, etc.

This re-linking of risk and consequence is not only the only moral way forward–it’s also the only political and financial way to clear the poison of moral hazard from the system.

Saving vested interests from the losses they earned and they deserve poisons the entire financial system. When the poisoned system finally collapses, it will destroy everyone with a stake in the system–including the vested interests who reckoned that their political power would save them from the losses that are rightfully theirs.

Playing monetary games has done nothing to eliminate moral hazard; indeed, playing monetary games cannot possibly eliminate moral hazard, as monetary policy enforces moral hazard.

Those playing monetary games–Kuroda, Draghi, Yellen et al.–will discover this, but only after it’s too late to stop the slide into the abyss.

How to forge a career in a bipolar economy:
Get a Job, Build a Real Career and Defy a Bewildering Economy
a mere $9.95 for the Kindle ebook edition and $15.47 for the print edition.

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Britain’s Vice News Reports Ukraine’s Firebombing of Southeast

Eric Zuesse

Vice News uploaded to youtube on November 12th this video of the firebombing of the southeastern Ukrainian village of Iliovaisk

and they also identified what the incendiary weapon used was.

Headlining, “’A Rain of Fire’: Ukrainian Forces Used Little-Known Soviet-Era Incendiary Weapons to Attack Iloviask,” their Harriet Salem reported, on November 13th, that Iliovaisk — a once “sleepy town in eastern Ukraine” — was hit on the night of August 14th by rockets fired from a hill 11 miles away, each of which warheads delivered hundreds of 4,000-degree-Fahrenheit thermite pellets that are illegal to use, except when deployed precisely against military targets, not against civilians, and not imprecisely, such as here (via an “unguided rocket delivered by an outdated 9K51 MLRS system”). Ukraine’s Government wanted to mass-murder the residents there, that’s all.

The Vice news report didn’t focus on the victims, but on the excuses for this. Salem mentioned instances when the Soviet Union had done this, and when the U.S. had used white phosphorous, and had also firebombed Dresden when Hitler ruled Germany and was attacking throughout Europe. A third of the Vice report was devoted to that; most of the rest was devoted to describing the weapon. As for the victims, they’re just victims. They’re dead. That’s all. War is war, and that sort of thing — no news there. It’s those people’s tough luck. After all, they had voted for Viktor Yanukovych. And, since Obama had installed a ‘democracy’ when he overthrew that democratically elected Ukrainian President, Obama needed to get rid of such voters, in order to be able to make his new Ukrainian regime last. That’s nothing Vice News would be interested in. It’s not even British.

Coloring the ‘news’ is easier than covering the news, and this is how the ‘news’ is colored.

However, for any ‘news’ medium to analogize firebombings against nazi countries that are invaders and threats to other nations, with firebombings of civilian populations who are purely in a defensive mode and haven’t invaded any nation, is, essentially, to lie. So, that ‘news’ report is colored lie, because there is no way in which the victims here have anything whatsoever to do with being nazis or even fascists. One can debate the firebombing of Dresden, but only deceivers will analogize this to that. Do the victims of these Ukrainian firebombings deserve this, in any way at all? Of course not. Justice and fairness are alien to the concerns of journalists now.

The standards of current journalism are beneath contempt. The profession has rotted so much that it’s virtually a branch of PR. It’s designed now to deceive the public. It does what it’s designed to do: propaganda.

And that’s the real news about the fake news. It’s really big news, especially because the purveyors of fake news can’t report it. They’re not allowed to, even if they want to. It’s like a sewer that pours not into a processing plant that cleanses out all lies, but directly into the public’s minds, polluting politics with those lies, producing ‘democracy,’ instead of democracy. So, how does such a sewer smell? It smells like “On the one hand, on the other hand: ‘fair and balanced.’” It smells ‘objective.’ There’s the viewpoint of the nazis, and then there’s the viewpoint of their victims. At Vice ‘News,’ however, no victims were even consulted.

Instead, there is in that ‘news’ report a link to another ‘news’ story, about cluster bombs having been used during the prior month, and victims are shown there, but no blood, it’s highly sanitized. That report said:

“Conclusive attribution of responsibility for the specific attacks on populated areas, which amount to a violation of the laws of war and potentially open responsible parties up to prosecution for war crimes, is far from clear cut in a conflict where a dynamic frontline, multiple sites of fighting, and a range of armed groups operating under a loose line of command has made troop and weapon movements exceptionally hard to track on both sides.”

No evidence exists that the defenders have been using any cluster-bombs, nor even had access to them. However, there’s plenty of proof that the Ukrainian Government has been routinely using cluster bombs, incendiary weapons, and other illegal armaments, against residential neighborhoods throughout the conflict-zone. Killing and maiming the people there is what the U.S. and other Western nations are financing the Ukrainian Government to do. That’s the very purpose of Western assistance since the coup. And Western ‘news’ media won’t even call the coup a “coup.” When we destroyed Ukraine’s corrupt democracy, we called it the introduction of democracy. It’s Big Brother, but not in 1984. And it’s far bloodier. It’s nazism. And it’s covered-up in the West, rather than covered in the West. Because the West is financing it. And associated oligarchs are also financing the West’s ‘news’ media. This is a cozy club that’s entirely on the delivery-end, not on the receiving-end, of the hell. So, the public in the West don’t get to know much, if anything, about the receiving-end of the West’s nazi operation. This is the new Western ‘democracy,’ replacing the former real thing. It’s not what one thinks of when the phrase “the West” is used. But it will come to be, because this is the new “the West,” and it seems to be the way the West will stay: oligarchic. Fascistic. Even racist-fascistic — nazi — which is the worst form of oligarchy. Isn’t that big news? But it can’t be reported in the West.

Even reporting it in Russia, as frankly as is being done here, isn’t easy. This news report and commentary was submitted for publication to virtually the entire English-language press. Less than 1% accepted it. One, which is located in Russia, rejected it and explained their reason (which none other did): “ VICE News despite its many flaws and biases is not the worst outlet covering Ukraine out there. Indeed they may actually be among the better ones, simply because nearly everyone else seems to be so horribly and atrociously bad these days. Also we have been advised by some of our other contributors and co-workers that we sometimes come off as a little too invested or even high-pitched at first sight, so at the moment we are really looking to present a slightly less seemingly-ideological front and looking for something perhaps a little bit more dispassionate if that is the right word.” It’s not the only “word” for that. The phrase used at Fox ‘News’ Channel in the United States, is “fair and balanced.” That’s Western ‘journalism,’ but should it pertain even outside the West? If Western ‘news’ standards are going to prevail even in places such as Russia, then what hope, really, will there be for authentic democracy to emerge? Setting the bar that low is threatening the survival of democracy everywhere. I’ll never accept that.


Investigative historian Eric Zuesse is the author, most recently, of  They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010,  and of  CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.

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Has CDC stopped testing for H1N1 because the pediatric vaccine isn’t working against H1N1?

By Meryl Nass, M.D.  Dr. Nass is  a board-certified internist and a biological warfare epidemiologist and expert in anthrax. Nass publishes Anthrax Vaccine.

The Tampa Bay Times reported today that two children had died of flu.  Which is odd, because if you scroll down to the current CDC charts below you will see a) that the mortality from flu and pneumonia is about as low as it gets, right now, and b) only one flu-associated child death has been reported this flu season for the entire country.  So it is odd that two children just died in the same state.  It is also odd that authorities would not name the towns where these children lived.
There are more oddities. Although the story below says otherwise, this season’s (and last season’s) live, nasal pediatric flu vaccine is ineffective against swine flu, as I noted here.  So, if these children got that vaccine, it would have offered them no protection against the swine (H1N1) flu.Yet the Florida Department of Health used its report of two pediatric deaths to scare parents and push flu vaccines, while refusing to say whether the children who died were vaccinated, and lying about the effectiveness of the available vaccine.

It isn’t only the Florida DoH acting oddly.  CDC is supposed to test flu strains to see which are circulating each season.  But suddenly, they are no longer testing for H1N1, despite the fact it was the predominant strain last year and they tested for it last year. And tested for it for the last 5 years. I can’t imagine another reason to stop testing for H1N1 besides avoiding embarrassment (to CDC and the vaccine makers) because the pediatric vaccine doesn’t protect against it, even though H1N1 is one of its components.  If you don’t know how much Swine Flu (H1N1) is causing people to get sick, then you can’t blame the shot for contributing to cases.

But it is even worse than this.  If you look at the bottom chart, CDC acknowledges that 88% of flu specimens were Influenza A, and only 30% of these were H3… suggesting that 70% were H1, and probably nearly all of those were H1N1.  But instead of CDC saying it didn’t know how many were H1N1, since CDC did not test for H1N1, CDC claims that there were 0.0% H1N1 Swine Flu specimens. That is a very precise number: 0.0%–and a total falsehood.

The Florida Department of Health announced Monday the deaths of two children, one in Pasco County and one in Orange County, from flu-related complications. Health officials refused to provide the ages and hometowns of the children. The Pasco child had an underlying health condition, said Deanna Krautner, a spokeswoman for the Pasco County Health Department. . . Experts say flu deaths in otherwise healthy people are unusual. Pre-existing health conditions often play a role in how individuals react to the flu. . .

“Our hearts go out to the family and friends of these children,” said Dr. Celeste Philip, deputy secretary for health and deputy state health Officer for Children’s Medical Services. “Getting the flu vaccine is the best way to protect yourself and others from the flu.”

In Florida, the most common influenza subtype detected in recent weeks has been influenza A (H3). Officials refused to say if that’s the type found in the two recent deaths. . .

Currently available vaccine formulations protect against all (sic) strains of influenza that have been identified as circulating in Florida this season, state health officials said. [But if you don't identify it, then you can make this claim without lying. Clever, huh?--Nass]

The U.S. Centers for Disease Control and Prevention recommends everyone age 6 months and older get vaccinated, with a few rare exceptions. State officials on Monday declined to say whether the two children who died had been vaccinated.

The following come from this CDC website:

Pneumonia And Influenza Mortality

Influenza-Associated Pediatric Mortality:

No influenza-associated pediatric deaths were reported to CDC during week 46. To date, one influenza-associated pediatric death has been reported for the 2014-2015 season.Additional data can be found at:


Click on image to launch interactive tool

U.S. Virologic Surveillance:

WHO and NREVSS collaborating laboratories located in all 50 states, Puerto Rico, and the District of Columbia report to CDC the number of respiratory specimens tested for influenza and the number positive by influenza virus type and influenza A virus subtype. The results of tests performed during the current week are summarized in the table below. Region specific data are available at
Week 46
No. of specimens tested 10,304
No. of positive specimens (%) 955 (9.3%)
Positive specimens by type/subtype
  Influenza A 836 (87.5%)
             2009 H1N1 0 (0.0%)
             H3 257 (30.7%)
             Subytping not performed 579 (69.3%)
  Influenza B 119 (12.5%)



Posted in Politics / World News, Science / Technology | 1 Comment

Jon Stewart “Partly Responsible” For Quite A Lot

Jon Stewart has written and directed a film about Iran’s criminal beating and imprisonment for five months of journalist Maziar Bahari.  Critic Joanne Laurier notes that Stewart, who is friends with Bahari, feels “partly responsible for the journalist’s troubles” because during Bahari’s imprisonment, he was questioned about a Daily Show segment in which he participated.

Stewart, along with and arguably to a greater extent than his fellow countrymen, is partly responsible for a lot more than that.  Our primary responsibility is for the actions of our own state, and the US has been torturing and committing terrorism against Iranians for over 61 years now, continuing today and projected far into the future.

While it is to be commended that Stewart shed light on an injustice, far worse is what we have allowed our own state to do to Iran (and many others).  We should be aware of this so we can try to understand the effects of and punish our own misdeeds to mitigate our ongoing and further, imminent crimes.

US-Iranian relations began in 1953 when the US overthrew Iran’s democracy by carrying out terrorist attacks.  Relations continue today through illegal US threats of force (terrorism, article II, UN charter), sanctions intended to harm Iranian civilians (terrorism), and plans for a possible US or US-client-organization re-invasion and mass murder operation to retake control of and loot Iran’s resources, space, and labor (terrorism, aggression, looting).

In 1953, US oil magnates used their armed force, the US government, to end Iran’s democracy and replace it with a monarchy.  The US barons then began looting 40% of Iran’s oil extractions; the remaining 60% were looted by Western Europe, whence US settlers originated.

While working towards developing nuclear energy with US support, the US/Iranian anti-democracy regime imprisoned, beat, tortured and/or murdered countless journalists, authors, educators, students, union organizers, and others.  One student recalled being shackled in a rancid cell and watching cockroaches, attracted by the open wounds inflicted on him by the terrorists, eat him alive.

The US was evil enough to produce special instructional film for its Iranian terrorist organization on such crucial topics as how to torture women.

Newsweek journalist John Barry has seen and described some of the US/Iranian regime’s recorded filth, which he refers to as “un-erasable pornography”.  While never mentioning the US role (perhaps allowing him to give a more honest account of his feelings), Barry notes of the films:

Even now, on bad nights, images surface.

It seemed endless. I have no words to convey the horror.

The film showed sequences of torture on living victims, men and women, all naked and shackled to what looked like a bed frame. A variety of techniques were demonstrated: cigarette burns to sensitive parts of the body, the effects of electricity, and then on into other savageries I shy from recalling. One technique shown on the film used water. The film was clearly professionally made. There was a commentary … explaining, among other things, the varying sensitivities of men and women to different techniques, with a filmed example to illustrate each lesson. This was an instructional film. These torture sessions were not even designed to elicit information. The film was intended to teach Savak [Iranian secret police] recruits.

Thankfully for the sake of knowledge and accountability, documentation of the US role is readily available.  For example, here is Middle East correspondent Robert Fisk in London’s The Independent, on August 9,  1998:

American intelligence … taught the Shah’s SAVAK secret police how to torture women; after the revolution, the Iranians found CIA film of these lessons.


Historian William Blum notes that SAVAK was “created under the guidance” of the US and Israel and, “according to a former CIA analyst on Iran”, the US instructed SAVAK in torture.

(Dan Mitrione is one US terrorist who became personally notorious for demonstrating torture on live victims – homeless people – though his particular sessions served to maintain and expand the USA’s Latin American iron curtain.)

As an example of the “notoriously savage” techniques used by the US/Iranian regime, Barry notes in Newsweek:

…an Iranian exile … had gone from Jordan into Iran to try to organize unions. Savak caught him, surgically amputated his arms and legs, and sent his living trunk back to his family in Amman as a warning.

Once their iron curtain was thrown off, Iranians discovered certificates documenting people who had been tortured to death by the US implant:

…hundreds and hundreds of forms.

The US/Iranian regime committed so much terrorism against secular opposition to monarchy that it enabled the Islamic resistance to take the lead once the tyranny was overthrown.

Being kicked out angered US terrorists, so they swiftly teamed up with Saddam Hussein, re-invaded Iran, and killed a million Iranian citizens (US per-capita equivalent of over 4 million citizens), many with gas, as well as thousands of Kurds, many with gas, both arguably acts of genocide.  In 1988, US pirates, thousands of miles from their own territory, shot down an Iranian civilian airliner in commercial airspace, killing almost 300 people.  A nearby US commander who witnessed the shoot-down wrote an article saying he couldn’t believe what he was seeing – a fatal US attack on an obviously civilian plane.  But when the pirates returned home, they, including the one who commanded the act, were given a hero’s welcome and awarded medals, and VP Bush Sr. said of the attack, exhibiting his signature class, “I’ll never apologize for America, ever.  I don’t care what the facts are…”  (The US soon thereafter, under Clinton, teamed up with Turkey for another genocide against the Kurds, then Bush Jr. perpetrated an illegal invasion of Iraq, the biggest crime of this century, that destroyed the entire region.)

Today, the US and its clients proudly murder Iranians, and US sanctions against Iran, like the illegal US sanctions against Cuba, are intended to, and do, harm Iranian civilians for political reasons – the textbook definition of terrorism.

While Iran’s actions against Stewart’s friend are inexcusable, the US and its clients are doing far worse to journalists, human rights activists, medics, whistle-blowers, etc., on an incomparably more massive scale, including arresting, censoring, imprisoning, torturing, and outright murdering them in cruel and unusual ways, such as complete dismemberment, bleeding to death, and lashing with whips.  Israel has the most political prisoners of any country in the Middle East, and NATO member/US client Turkey, according to a 2011 HRW report, has more journalists in prison than China (though no one in the world – apart from US drone base/Western colonial piracy victim the Seychelles – competes with the US in terms of percentage of population kept in cages against their will).

Saudi Arabia, much worse than Iran and a major US client since the 1930s, doesn’t even pretend, as Iran, the US, China, and others do, to have “democratic” procedures that do nothing but entrench dictatorship.  It’s simply another of the straight monarchies US terrorists love to install and/or support.  Saudi Arabia imprisons and tortures people for Tweets and other social media comments.  It recently sentenced a blogger to ten years in prison and torture by one thousand lashes, and was also recently caught giving its prisoners ultimatums to either stay in Saudi dungeons or join the unpopular, US-backed “rebels” fighting to overthrow Syria (as part of an operation to conquer Syria the US began in 1948 and continues today).

What does the brave hero Obama do in the face of one of his biggest clients behaving this way?  Showers them with an unprecedented amount of rewards, sending the corrupt Saudis the biggest shipment of lethal weapons in US history, which Obama did in 2013.

The US runs a global torture network involving over 50 nations.  In just the last ten or so years, scores have been mercilessly beaten, imprisoned, and tortured, including to death, including around a hundred tortured to death by the US alone, including people marked in official documents as civilian or “n/a”.

Aside from the US, the top ten foreign organizations that receive US funds are also all torturers.

The USA has targeted and killed or tortured tens of thousands of civilians for “crimes” including writing, speaking, educating, whistle-blowing, striving for democracy/independence, and defending themselves or their countries from US looting and exploitation.

Here is a specific case for which Stewart (and all US citizens) are “partly responsible”.  Perhaps it could be the subject of Stewart’s next film.

In 2003, US terrorists abducted Khalid El-Masri in Macedonia, anally raped with an object and beat him as part of a terror-inducing procedure, then took him to one of innumerable US torture-holes, this one called “the salt pit” (which appropriately sounds like something from a horror film like Saw), where they continued to beat and interrogate him for over a year, giving him just enough rations and “putrid” water to survive, until he couldn’t take it any more and tried to starve himself to death until he was finally released because the USA figured out he was just some random, innocent family man they had kidnapped, who had nothing to do with anything involving politics.

Why did the US drag this poor man down to its level for over a year?  Because his name was similar to the name of one of countless suspects the US wanted to torture and interrogate without trial or access to a lawyer, and US terrorists had “a hunch” that Khalid was the right guy.  Literally.

It makes sense for Stewart to feel partially responsible for Bahari’s brutal five month ordeal.  Anyone who provided a platform for people to speak out about the US/Iranian terror regime may likewise have felt somewhat responsible for what happened when and if the US surrogate got hold of the person.  But, clearly, dissent should not have been avoided.

Julian Assange (whom Stewart has “cynically and viciously attacked”) must feel somewhat responsible for Obama’s pre-trial condemnation, torture, and imprisonment of whistle-blower Chelsea Manning (pre-trial imprisonment exceeded legal limit by approximately 1,400%), followed by Manning being sentenced to 35 more years of imprisonment, after which she will be 60.  But, obviously, Assange should not have buried Manning’s revelations.

Perhaps the Catholic Church felt somewhat responsible for the murder of Father Óscar Romero, who spoke out against US-backed torture and assassination, and was assassinated by US-trained and supported terrorists in a chapel while delivering mass.

US Terrorist Training/Aggression Camps Surrounding Iran

While Stewart may not be able to help feeling more responsible for someone he happens to know than for hundreds of thousands of US victims treated worse than Bahari, he should still make the bigger picture abundantly clear.  This would help avoid reduction to propaganda that serves the ongoing, barbaric US terror campaign against Iran, which is surrounded by US terrorist training and aggression camps, represented by stars on the map, right.

To censure Iranian crimes today without acknowledging the shameful US role is similar to a parent condemning his teenager for misbehaving without mentioning that the parent physically abused the child for years.  This is maliciously self-serving at best and delusional at worst, though Stewart could perhaps also claim ignorance.  (The parent/child relationship is analogous here in terms of size and power, not maturity or knowledge.  Iran is an ancient civilization.)

Though he should be commended for speaking out against illegal practices by Iran, Stewart’s primary responsibility lies where it does for us all: we are each partly responsible for the actions of our own state, and, as a whole, one hundred percent responsible.

In the case of Iran’s beating and imprisonment of Bahari, we do, indeed, bear some responsibility: we let our state get away with overthrowing Iran’s democracy, installing a tyrannical monarchy, and killing over a million Iranians, many with gas – a grisly record of looting, terrorism, repression, murder, and mountains of corpses, that eventually led to the mistreatment of yet another journalist.

Throughout the world, on any given day, a man, woman, or child is likely to be displaced, tortured, killed or “disappeared”, at the hands of governments or armed political groups.  More often than not, the United States shares the blame.

- Amnesty International

For a political comedian/analyst/TV-host more capable of balancing details with the big picture (with none of Stewart’s tribal reverence for homegrown terrorists like Barack and Hillary), see Lee Camp.

Robert Barsocchini is a researcher focusing on global force dynamics.  He also writes professionally for the film industry.  Here is his blog.  Also see his free e-book, Whatever it Takes – Hillary Clinton’s Record of Support for War and other Depravities.  Click here to follow Robert and his UK-based colleague, Dean Robinson, on Twitter.


Review of Stewart’s new film, plus comments on his superficial criticisms of and mindless praise for his own state, the world’s leading criminal organization, and his attacks on people such as Assange

US plans for re-invading Iran directly or through proxy

US has been torturing, committing terrorism against Iran for over 60 years.  See, for example: 1, 2

US oil magnates and their armed forces

US took 40% of Iran’s oil extracts, etc.

With US regime in place, US claimed Iran needed nuclear energy for economic reasons; now claims it does not because it is no longer “an allied country” (Kissinger)

Student’s testimony on torture by US/Iranian regime

“How to torture women” noted by William Blum

Barry in Newsweek

Independent Article referenced by Blum

Further blum quotes, ibid.

More US/Iranian torture techniques

Dan Mitrione’s torture of homeless people as instruction for US anti-democracy regimes in Latin America

US/Hussein invaded Iran, killed a million Iranians (and here)

US attack on Iranian civilian airliner in commercial airspace and Bush Sr.’s quote (and here)

On the USA’s two genocides against the Kurds

US sanctions against Iran meant to target, harm civilians for political reasons; definition of terrorism (1, 2, 3)

US sanctions against Cuba meant to target, harm civilians for poltical reasons; definition of terrorism

Israel political prisoners

Turkey imprisonment of journalists

US operation to conquer Syria started in 1948

Saudi Arabia US client since 1930s

US global torture network of over 50 nations (and here)

US torturing people to death

USA has targeted and killed or tortured tens of thousands of civilians for “crimes” including writing, etc. (see, for example, here and here)

Khalid El-Masri

‘Brothers, you are from the same people, you kill your fellow peasant… No soldier is obliged to obey an order that is contrary to the will of God… In the name of God then, in the name of this suffering people I ask you, I command you in the name of God: stop the repression.’ - Father Óscar Romero, and here

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British and American Security Services Pass Around Our Nude Photos … While Protecting Pedophiles

Should We Trust Governments Which Pass Around Our Nude Images … While Protecting PEDOPHILES?

Preface:  Bill Cosby’s alleged rape of at least 16 women (12 through drugging) is inexcusable. But the crimes discussed below are much worse, because they involved kids or because they effect all of us.

The British spy agency GCHQ and the NSA collected millions of webcam images … many of them nude.

NSA employees routinely pass around nude photos and videos of everyday normal citizens gathered through mass surveillance.

They say: “Trust us, we won’t misuse any nude images.”  They say: “We’re the good guys … just trying to stop bad guys.”

But the British security services allegedly helped to cover up widespread pedophelia in Britain.  Indeed, a whistleblower alleges that the British security services supported and funded pedophile rings as a way to blackmail establishment figures.

Something similar may have happened in the U.S.  Yahoo News reported in 2010:

A 2006 Immigration and Customs Enforcement investigation into the purchase of child pornography online turned up more than 250 civilian and military employees of the Defense Department — including some with the highest available security clearance — who  used credit cards or PayPal to purchase images of children in sexual situations. But the Pentagon investigated only a handful of the cases, Defense Department records show.


But the DCIS opened investigations into only 20 percent of the individuals identified, and succeeded in prosecuting just a handful.

What about the other 80 percent?  Were they blackmailed?

Yahoo continues:

Without greater public disclosure of how these cases wound down, it’s impossible to know how or whether any of the names listed in the … papers came in for additional scrutiny.


According to the records, DCIS prioritized the investigations by focusing on people who had security clearances — since those who have a taste for child pornography can be vulnerable to blackmail and espionage.


At least some of the people on the … list with security clearances were never pursued and could possibly remain on the job ….

The NSA also tracks people’s porn-viewing habits in order to discredit activists.  The NSA also keeps nude and suggestive photos of people in order to blackmail them.

Should we really trust these people? Are they the good guys?

Posted in Politics / World News | 6 Comments

U.S. Among Only 3 Countries at U.N. Officially Backing Nazism & Holocaust-Denial; Israel Parts Company from Them; Germany Abstains

Eric Zuesse

In a U.N. vote, on November 21st, only three countries — the United States, Ukraine, and Canada — voted against a resolution to condemn racist facsism, or “nazism,” and to condemn denial of Germany’s World War II Holocaust against primarily Jews.

This measure passed the General Assembly, on a vote of 115 in favor, 3 against, and 55 abstentions (the abstentions were in order not to offend U.S. President Obama, who was opposed to the resolution).

The measure had been presented to their General Assembly after a period of more than a decade of rising “neo-Nazi” (i.e., racist-fascist) movements in Europe, including especially in Ukraine, where two Ukrainian nazi parties were installed by the U.S. into high posts in Ukraine’s new government, immediately after the democratically elected Ukrainian President Victor Yanukovych was overthrown in a violent coup in Kiev during February of this year. The entire Ukrainian ‘defense’ establishment was then immediately taken over by the leaders of these two nazi parties, which rabidly hate ethnic Russians, and Ukraine is now led by the first — and so far, the only — nazi government to take charge of any country after the end of WW II. Within less than a mere three months after the coup, this new Government began an ethnic-cleansing program in Ukraine’s own ethnic-Russian southeast, where around 90% of the residents had voted for the man who had been overthrown in the coup — this was a campaign to isolate and exterminate those people, so that those voters could never again participate in a Ukrainian national election. Unless those voters would be eliminated, these nazis would be elected out of power — removed from office.

Ukraine voted no on this resolution because this new Ukrainian Government is the only nazi regime in the world, and they are doing the standard nazi things, and so what they are doing is in violation of numerous international laws, which are not being enforced, but which are re-asserted and re-affirmed in this resolution, though Ukraine and the Ukrainian situation aren’t at all mentioned in the resolution. The United States voted no on it, because the U.S. Government had placed them into power. And Canada voted no on it because their far-right Prime Minister, Stephen Harper, has been a virtually unquestioning supporter of all U.S. foreign-policy positions, and wants U.S. President Barack Obama to approve construction of the Keystone XL pipeline to assist the Koch brothers and other large oil giants to profitably transport and sell to Europe and around the world, tar-sands oil from Canada’s landlocked Athabasca region.

Germany abstained from voting on this resolution because their leader, Chancellor Angela Merkel, does not want to offend the U.S. President by voting for a resolution that the U.S. Government strongly opposes; and also because, as today’s leader of the land where nazism started — in the first nazi political party, the Nazi Party of Germany — she does not want Germany to vote against a resolution that condemns Nazism. If Germany were to have voted against this anti-nazi resolution, she would have faced a political firestorm at home. So, Germany abstained, in order not to offend Obama on the one side, and her public on the other.

Key to understanding the vote on this resolution is knowing the relevant historical background, which has largely to do with the world’s only nazi-led Government: today’s Ukraine. Consequently, the remainder of this article will explore that issue in depth, so that this otherwise-incomprehensible U.N. vote will become comprehensible.

According to the U.N.’s press-report on the votes occurring on November 21st, “Speaking before the vote [on this resolution], the representative of Ukraine said Stalinism had killed many people in the Gulag, condemning Hitler and Stalin alike as international criminals. Calling on the Russian Federation to stop glorifying and feeding Stalinism, he said he could not support the draft text.” Ukraine refused to condemn nazism, because the resolution did not call for a condemnation also of Stalin, and of Russia. “Any intolerance should be dealt with in an appropriate and balanced manner, he added.”

Samantha Power, the U.S. Representative at the U.N., gave as her reason for voting against the resolution, its unacceptability to the Government of Ukraine. “Her delegation was concerned about the overt political motives that had driven the main sponsor of the current resolution. That Government had employed those phrases in the current crisis in Ukraine. That was offensive and disrespectful to those who had suffered at the hands of Nazi regimes. Therefore, the United States would vote against the resolution.” In other words: the U.S. opposed this resolution, supposedly, because it was offensive to Ukraine, even though the very term “Ukraine,” and all other conceivable references to Ukraine, were and are entirely absent from it. (Here is the entire resolution.) The world’s only nazi Government, Ukraine, thus had an opportunity to condemn nazism, and chose not to not vote on it, but to vote against  it. And their sponsor, the United States, joined them in that. But which was the master here, and which was the slave? Was the U.S. simply doing the will of the Ukrainian Government? Or was the Ukrainian Government doing the will of the U.S. Government — the Government that had installed it? Consider this:


My prior article, “Meet Ukraine’s Master Mass-Murderer,” documented how U.S. President Barack Obama — through his State Department and CIA and the U.S. Embassy in Ukraine, and with funding by U.S. and Ukrainian oligarchs — exploited the “Maidan” movement in Ukraine, to replace the corrupt but democratically elected pro-Russian Ukrainian President, Viktor Yanukovych, by a rabidly anti-Russian, racist-fascist and thoroughly corrupt regime, whose most powerful person is Dmitriy Yarosh, who had founded and still leads one of Ukraine’s two racist-fascist, or “nazi,” armed political parties, Right Sector, and who commands a dedicated personal army of 7,000 highly trained “paramilitaries,” who not only terrorize and freely murder dissenting Ukrainians, but who even publicly, and with equal impunity, threaten the nation’s figurehead President, Petro Poroshenko, to keep him in line.

The present  article will mainly describe Yarosh’s chief competitor for power, the thuggish Ukrainian-Israeli-Swiss multibillionaire, Ihor Kolomoysky, who likewise commands a private Ukrainian army of around 7,000 mercenaries, and likewise issues public threats to overthrow Poroshenko, if Poroshenko fails to do his bidding. But first, here’s the story about


It’s important to note that the figurehead, Poroshenko himself, is a corrupt billionaire oligarch, who, like Kolomoysky and Yarosh, has long been working with the CIA and U.S. Ambassadors and Presidents, in order to wrench Ukraine away from its historical alliance with Ukraine’s main bordering nation, Russia. So, Ukraine’s figurehead is the man whom U.S. President Obama and Republicans in Congress, and conservative congressional Democrats such as Senator Robert Melendez of New Jersey, parade before the U.S. media and their essentially captive American audience, as the face of ‘Ukrainian democracy,’ which is threatened by the ‘imperialistic designs’ of Russia’s President, Vladimir Putin.

Putin, of course, doesn’t like America’s and the EU’s surrounding his nation by new NATO nations (such as, perhaps, now Ukraine) which invite in U.S. military bases, and become next-door launching-pads for U.S. nuclear missiles aimed against Russia. Putin is vilified in “the West,” as Washington wants. The media pass along what the U.S. Government says. The American public doesn’t care whether Russia is surrounded by hostile nuclear missiles, and whether ethnic Russians in Ukraine, right next door to Russia, are being exterminated and driven out to become refugees in Russia. Putin isn’t being feted in Washington, as Poroshenko is. Instead, the United States is on Poroshenko’s side, against Putin’s side. In fact, U.S. President Obama, all congressional Republicans, and all conservative Democrats, praise Poroshenko, and condemn Putin, as if Putin were surrounding the U.S. with his military bases, instead of us surrounding his country with ours.

But, actually, Poroshenko is on America’s side: America isn’t on his side. Poroshenko has for a decade been a bought U.S. agent, after having first achieved his wealth by serving Ukraine’s Russian-appointed communist leaders, and then getting sweet inside deals on Harvard-designed privatizations of what had formerly been Ukrainian state-owned properties, such as a shipyard, a chocolate factory, and a TV station. But now, he’s ‘on America’s side.’

For America’s oligarchs, the Cold War never ended; it wasn’t really about communism versus capitalism; it was instead about which nation’s oligarchy would be supreme over all other nations’ oligarchies. And, when the communist (Russia-allied) team went down, Poroshenko knew to take his favors from them before, in 2004, selling himself out to the opposite (America-allied) team. And that’s what he did.

As regards what type of man Poroshenko himself actually is, consider carefully the phone-conversation between the top EU foreign-affairs official Catherine Ashton and her investigator in Kiev Urmas Paet, on 25 February 2014, right after the coup. See the call’s transcript in the middle of this, in italics, at the point where I’ve marked in brackets, “[So, Poroshenko himself knows that his regime is based on a false-flag U.S.-controlled coup d’etat against his predecessor.]”. In other words: by no later than 25 February 2014, Poroshenko already knew that this was a U.S.-backed coup and not an action on the part of the Yanukovych Government. From at least that moment forward, he was participating in, and keeping quiet about, treason to his country. He is a traitor to his nation. That’s the type of man he is. (EU officials likewise knew about it, after this phone-conversation. But they’re all quiet about it. Apparently, they, too, are on the take.)


Britain’s Independent reported on 11 September 2013 (which was before the coup and so our ‘news’ media were reporting such things then), “Mr Kolomoisky had the reputation of being a ‘corporate raider’, someone who attacked companies by destabilising management, driving down the share price and grabbing control ‘without paying what the other shareholders would regard as a proper premium for their shares’. Mr Kolomoisky had, the judge noted, a reputation of having sought to take control of a company ‘at gunpoint’ in Ukraine. Even his main witness in the trial admitted that was his boss’s image.”

Then, on 15 January 2014, barely a month before the coup, The Hill reported about Kolomoysky and his sidekick Bogolyubov and about Kolomoysky’s huge bank, Privat, that, “In the takeover of the Kremenchuk steel factory in 2006, Privat’s raid was literal, with Kolomoisky and Bogolyubov hiring an army of thugs to descend upon the plant with baseball bats, gas and rubber[-bullet] pistols, iron bars and chainsaws. Needless to say, Kremenchuk’s steel production was soon under Privat’s control.”

Then, after the February coup, the great American independent journalist George Eliason, who happens to live in Ukraine’s conflict-zone, reported on 23 June 2014, that, “When the Kolomoisky mercenaries go into the shops it’s like a siege. They come twenty at a time circling the shop with their weapons pointing at anyone walking by. They do not receive government supplies so they clean out the stores, leaving little for residents.”

Then, Eliason added: “In reaction to the peace plan, Kolimoisky (banker, Jewish leader, oligarch statesman of Ukraine) stated that he will not be governed by Poroshenko. He would continue military operations until all the Moskal [ethnic Russians] are killed. Take him seriously: this is a guy that rips down holocaust memorials (Crimea—before Maidan) and built luxury housing where the crematorium stood. He organized and paid for the Odessa Trade Union House massacre and the Mariupol massacre. He has challenged the legitimacy of Kiev and declared himself a separatist. Should we tell president Obama?” (Obama says that the people who are being killed by his new Ukrainian Government deserve to die because they’re separatists.)

In other words: Kolomoysky respects no law but his own.

Right after the coup, Kolomoysky was appointed by Obama’s team as the Governor of the Dnipropetrovsk Oblast, or region, on 2 March 2014.

AFP reported on October 31st, “Kolomoisky, one of Ukraine’s most controversial billionaires, funds the paramilitary, which returns the favour in these troubled times by boosting the banking and industrial tycoon’s personal security and political clout. All the signs are of a flourishing military enterprise.” Kolomoysky’s henchman Yuriy Bereza was asked how many men are in the battalion, and he answered, “Unofficially, it’s 7,000.” Bereza was threatening to overthrow the Poroshenko Government if they didn’t kill or drive out enough ethnic Russians fast enough, and was asked how much time Kolomoysky was intending to give Poroshenko. “We’re going to give them half a year.” And then, if Kolomoysky still isn’t satisfied? “‘A coup,’ he said.”

I have previously written about Kolomoysky’s links to the Obama White House. Kolomoyskyi has hired Joe Biden’s son, and another young man who is connected to John Kerry. Both could become billionaires if the U.S. team kills and drives out enough people in the targeted regions, because Ihor Kolomoysky’s company that hired them has claims to the fracking rights in much of the area the Government is bombing. To Obama’s team, the residents there are trash, but the land is golden.


Some members of the U.S. Congress are opposed to the U.S. supporting nazism in Ukraine. All are Democrats. One, Rep. John Conyers of Michigan, introduced a bill against it, and the journalist Max Blumenthal posted its text at Alternet, on November 18th. Headlining there, “How the Israel Lobby Protected Ukrainian Neo-Nazis,” Blumenthal presented the “Failed Amendment barring US assistance to Ukrainian neo-Nazis.” What killed it was the rabid anti-Russian sentiment at the Anti-Defamation League, plus congressional Republicans, and the few conservative congressional Democrats.

As that incident shows, anti-nazi sentiments can pass toothless measures at the United Nations, but not meaningful measures in the U.S. Congress, where Obama’s campaign to vilify Russia resonates strongly, especially amongst the U.S. Establishment.

Even after communism in Russia ended, America’s oligarchs (including even Democratic ones, such as George Soros, and Pierre Omidyar) still loathe Russians, and aren’t at all shy about using foreign nazis in order to do the dirty-work of mass-murdering them, where and when they can.


Investigative historian Eric Zuesse is the author, most recently, of  They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010,  and of  CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.

Posted in Business / Economics, General, Politics / World News | Tagged , , , , , , , , , , , , | 10 Comments