Pakistan Tops Our List of World’s Worries

The variety of possible topics for Monday’s commentary was so overwhelming that it’s hard to know where to begin. Let’s take them one at a time:

Pakistan:  Until recently, we’d always thought of the al-Qaeda and Taliban insurgents as a rag-tag bunch of skirmishers, more like commandos in their operational style than armies.  Think again. We now read that they are holding 30,000 Pakistani troops at bay in South Waziristan.  If there really is a War on Terror, this is the biggest and most important battle so far.  And if Pakistan loses, the world will become a far more dangerous place. Emboldened and refreshed, Radical Islamists would find it much easier to recruit new fighters and suicide bombers. The terrorists would also be further along the way toward seizing control of a Pakistani nuclear weapons capability that has been under development for 35 years. The potential consequences of this are almost too horrifying to think about, and we can only pray that Pakistan’s army derails or at least delays a Terrorist Bomb by delivering a knockout punch.

Falcon-Heene

The Health Care Juggernaut:  Baring his canines, Obama has accused the insurers of being a bunch of dirty, rotten liars. The insurance companies claimed merely that Obamacare would significantly raise the cost of healthcare for most American households. Does anyone actually doubt this? If so, it’s scary to think that they vote.  This note from our friend Rich Cash nicely sums it up:  “A health care system plan written by a committee whose head says he doesn’t understand any of it, to be passed by a Congress that hasn’t and won’t read it, but exempts themselves from it, signed by a president who smokes and also hasn’t read it, with funding administered by a Treasury Secretary who didn’t pay his taxes, overseen by an obese Surgeon General, and massively financed by a country that’s nearly broke. Great plan! What could possibly go wrong?”

Wage Plunge Steepest in 20 Years:  This was the lead story in the usually chipper USA Today over the weekend. We leave it to the inflationists to tell us how it will translate into higher prices for consumer goods – higher prices for anything, actually. Perhaps The Guvvamint actually will have to add three zeroes to our bank accounts to breathe a little inflation back into the economy. Nothing else has worked, as everyone but the inflationists could readily attest.

Holiday Air Fares Soar:  The inflationists better not read beyond the headline, since the Wall Street Journal story explains that the airlines’ strategy is to ground as many planes as it takes to keep the supply of seats tight. That means layoffs and unpaid furloughs for pilots, flight attendants, baggage handlers, mechanics and other personnel. If United eventually has ten planes in the air filled with passengers who have paid an average of $20,000 per seat, is that inflation?

The Hoax:  Now a Colorado prosecutor wants to bring criminal charges against the Heenes for staging a supposed hot-air-balloon hoax. But just who is the victim here?  And who, for that matter, is the perpetrator? Doesn’t a perenially lazy news media deserve nearly all of the blame for raising the visibility of an unverified story to the threshold of War of the Worlds hysteria?  

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  • tom r October 23, 2009, 5:13 am

    to Chris T Absolutely right. Thank you for elaborating the points.

  • Chris T. October 21, 2009, 11:34 pm

    Tom,

    you make two good points.

    The Northern Alliance, and the minorities it compriese, actually were complicit WITH Najibullah in the 1980s in being PRO-Soviet, whereas the “Taliban” in their actuality Pashtuns, were “ours” and fighting the Soviets. Now all of a sudden we are the friends of the corrupt pro-Soviet block.
    if this more than anything does not demonstrate the expedience du jour of our foreign and military actions, then I don’t know what does.

    Now, one can be expedient always, that is the Machiavellian way. HOWEVER< when one claims to be acting out of high moral principle, as we ALWAYS do, it is when hyporcirsy is revealed. That is why so much of the world hates our actions so much, not for our lifestyle. Unfortunatley it takes too much attention span to convey this to Mr. Joe-Six-Pack couch-lock, so the "hate our lifestyle cliche sounds much more appealing, because it only takes 5 seconds to convey.

    As to petraeus being a desk-jockey: That has been our way for a long time too.
    The vaunted Eisenhower, was simply a political desk jockey appointment, whose military capabilities were reviled by true soldiers such as McArthur, who had not kind words. Patten not only detested Eisenhower, he practically hated the man and all he stood for. But he was Rossevelt;s yes man, so he became chief of staff.
    The German army actually had the same type of person at its helm, Keitel was as much a stooge of Hitler's, never stood up to him. His nickname was Lakeitel, as in lackey (but of course you better not got caught saying so)

  • tom r October 21, 2009, 9:56 pm

    My recollection is we replaced the Taliban with a corrupt coalition of ethnic minorities, led by the “Northern Alliance” of warlords, on the specious pretext that they refused to capture and render unto our rulers Osama Bin Laden, without any evidence of his guilt offered. The real reason was we wanted to construct (and defend) oil and gas pipelines from the Caspian Sea fields through Afghanistan to the Indian Ocean. The negotiations broke down, so excuses were found for occupying the country: harboring the 9/11 mastermind, and liberating Afghan women.The incredibly wasteful US military wanted control of the Caspian Sea oil, as it does of Iraqi (and Iranian) oil. 9/11 was a Saudi operation, for which, to my knowledge, Osama has not claimed responsibility, although he applauded the action. One must not accept US government propaganda for fact– about the Taliban, Saddam Hussein’s WMDs, or Iranian bellicosity. It was strategic imbecility to put ground troops in Afghanistan, terrain more operationally difficult than the mountains of North Korea or the jungles of Southeast Asia. Our generals rarely have the courage to tell arrogant scoundrels like Don Rumsfeld “NO”. Shinseki did, when he insisted 300,000 or more soldiers would be required for Iraq’s occupation. He was unjustly shamed and ignored for the remainder of his term as Joint Chiefs of Staff Chairman. So we get politicos like Petraeus, whose only command above a platoon was the 82nd Airborne Division during the 2003 Iraqi “cakewalk”. He’s a courtier, not a soldier.
    As observed above, the Taliban had almost completely eradicated poppy cultivation/opium production at the time of their overthrow. We put in power the very people whose illicit and immoral (per the Koran) activities the Taliban had suppressed.

  • Mitch October 20, 2009, 4:32 am

    Rick,
    I’ve rarely seen airfares so cheap to Hawaii. Roundtrip out of Portland to Maui can be found for around $340. This is the price I paid 12 years ago when I first starting flying there. Other dates were still cheap at around $400. Only the Holiday dates were higher. These planes are not full by any stretch.

    &&&&

    The airlines must be taking advantage of must-travel-to-see-grandma-over-the-holidays urgency. Can they survive like that, preying on funeral-bound travelers as well? Similar straits suggested by this Onion headline, a great one: “Report: Majority Of Newspapers Now Purchased By Kidnappers To Prove Date” RA

  • Chris T. October 19, 2009, 11:29 pm

    One quick addition about your posts first part:

    The Taliban were also able, back when we called them mujahedeen, to keep at bay and defeat the Soviets. They are not some new kind of fighter, they are simply organized Afghanis, and I bet they are getting “materiel” support today, just like we gave them in teh 1980s. Funding is ample too, thanks to the opium. The graveyard of empires won’t be disproved there this time around.

    As to Waziristan: This action, for whatever its merits or not, by the Pakistani Army is CLEARLY illegal under the Pakistani constitution. When the Authonmous territories agreed to join Pakistan some 50 years ago, complete internal autonomy and NO interference whatsoever by Islamabad was a precondition. Only the very border on the west was ceeded to the Pakistani Army.

    The Army is doing this at our behest, and for our silver coin, against their own laws. Chances are, that the 30,000 Pakistanis will fare no better long term than the 70,000 Nato troops in Afghanistan, or the Russians 20 years ago. What then? That will cause that country to collapse more so than anything.

  • Chris T. October 19, 2009, 11:16 pm

    Rick,

    saw your link to Krauthammers article. Was that posted because you felt it interesting in general, or because you agree with the sentiment?

    I ask because he writes:

    “Which leads to my second proposition: Facing the choice of whether to maintain our dominance or to gradually, deliberately, willingly, and indeed relievedly give it up, we are currently on a course towards the latter. The current liberal ascendancy in the United States–controlling the executive and both houses of Congress, dominating the media and elite culture–has set us on a course for decline. And this is true for both foreign and domestic policies. Indeed, they work synergistically to ensure that outcome.”

    It is the maintenance of the kind of dominance he talks about that is setting us, and has set us, on a course for decline, not that which he decries. I hardly share the agenda of those he blames, but it is this man, along with the Cheney’s, Wolfowitz’s, Perle’s, and Kristol’s fo this world (whose bed fellow he is and has been) that is most at fault.

    What dominance in non-military is he still crowing about? Selling our industrial base into the third world? Even our scientific base, in our still great academies, would not produce what it has and is producing, if we had to rely solely on homegrown talent, sad to say.

    He reminds me of that Laffer-Schiff debate from some time ago, where the Laffable mr Laffer said (not verbatim): Our financial system is spectacular, this is what we bring to the world, and everyone wants it.

    Instead, we have 700+ declared foreign bases, prob. another 200+ undeclared ones, are fighting a trillion dollar war, and feeding it with cannon-fodder that signs up to have a better future.

    Like the young mother (non-com) said during her (third-tour) reswearing in in the US embassy in Bagdad last December: I am doing this for my daughter, so I can safe money for college.
    This is the choice this dominant nation now gives to many of its young: work for the military at menial pay for lack of anything better, and better the family by perhaps having them lose their mom at age five.

    Me, I will keep reading Ron Paul, and vetting my reading time by the name of the author!

  • Tough Guy October 19, 2009, 9:11 pm

    Rick,
    After reading some of the comments here I’m astounded at what a short memory some of your readers have. Sorry to break the news, but yes, 9/11 did really happen and yes, the plan was concocted by Al Qaeda chief Osama bin Laden – who was a guest of the Taliban and who the Taliban refused to hand over to the US face justice. Return the Taliban to power and Al Qaeda training camps and Al Qaeda “think tanks” will return to Afghanistan.
    Islamic fundamentalists do not negotiate – they believe that the infidel must die and will not rest until that happens. Read the Koran. Shame on you revisionists and conspiracy nuts who blame the US for the existence of terrorism. If Pakistan fails to root these assholes out, or worse, loses, where do you think the nukes will be headed?

  • Richard Wicks October 19, 2009, 8:39 pm

    I had to comment on the 11th comment:

    “the world turning against Israel is my number one concern”

    This is the country, after all, that ramped up a nuclear weapons program in secret as they told the world that they were doing it purely for peaceful purposes in Dimona and were exposed by Mordechai Vanunu, who they subsequently kidnapped from Rome with the Mossad, then stuck him in prison for 18 years, 11 of them spent in solitary confinement and now are wailing that possibly Iran, might follow their example, and do the exact same thing.

    Iran after all has never attacked another country, that’s not the case for Israel.

    And besides, none of this would be a problem in the first place if there was no Islamic revolution which was originally the Iranian revolution that formed to throw out the Shah in Iran and were successful in 1979, who first formed as a resistance to the Shah when he started to run a police state in Iran, who was put into power by the United States after the United States performed Operation Ajax that destroyed the Iranian Democracy in 1953 jailing Mossadeq for life. Operation Ajax is now declassified, why did that happen? Well, the US got a 40% cut of Iran’s oil production afterward, that should explain it.

    Iran is acting totally rational, unless you think it’s just crazy for them to setup some sort of resistance against a country that has already overthrown their government, which told lies to get troops into Iraq, and is in Afghanistan, completely surrounding Iran.

    Maybe if they were just left alone, and if the US didn’t continually screw with them, they would be less militant? Just a thought.

    &&&&&&

    Did Bob Moriarty send you to expand on his crackpot history of Israel, Wicks? What kind of “totally rational” country threatens to wipe another off the map? RA

  • Ron October 19, 2009, 8:31 pm

    “If United eventually has ten planes in the air filled with passengers who have paid an average of $20,000 per seat, is that inflation?”

    YES!!! Inflation is a rise in the money supply relative to the available goods and services, and does not have to be reflected in prices at any specific point in time. If supply of goods is falling relative to money, that is inflation by definition.

    &&&&&&

    Another take on “inflation” that is not only useless, but wholly illlogical and counterintuitive. This is the kind of nonsense that is helping deflationists win the alleged debate. RA

  • Rich October 19, 2009, 7:32 pm

    Appreciate intelligent political economic strategic investment insights.
    Pakistani troops in the Northwest Province may be less to protect US interests, and more to protect Pakistan nuclear missile arsenals. Much of the Pakistan Army may sympathize with Muslim causes. It appears China, Iran and Russia may be arming, exploiting and funding Muslims with satellite reconnaissance and strategic support to destabilize US interests in the Middle East, if there are any, as Ron Paul and many unemployed Americans question.
    Google Muslim Brotherhood and Charlie Wilson’s War re how USA allies created, funded, trained and armed Al Qaeda. Covert alliances and operation blowbacks may have led to World Wars I & II, Korean War, Vietnam War, Operation Ajax Iranian Coups, Panama Invasion, Persian Gulf, Afghanistan, Iraq Wars and now Pakistan. Drugs often involved with Black Ops, one reason Maxine Waters, named one of the 15 most corrupt members of Congress, and others accused the CIA of running drugs.
    Re Pakistan, some even speculated Benazir Bhutto was an Anglo American hit, as she was reportedly planning to expose other Western intelligence hits and operations in her campaign to modernize and reform Pakistan. (She and her husband were described as corrupt by a Pakistani diplomat family/clients.)
    USA gave $6.6 B to Pakistan to buy ISI and military. Two Pakistani Generals claim just $500 M reached the Army, resulting in helicopter, night vision and other equipment failures and possible operations in Kashmir and Mumbai against Hindu India. Let’s not forget AQ Khan was involved in nuclear technology proliferation with Iran, Libya and North Korea, described by some as the Klaus Fuchs of nuclear weapons technology. That the USA did not say much begs the question of US covert involvement. Recall KF, with Harry Gold, David Greenglass. Morton Sobell and the Rosenbergs, was convicted and imprisoned for passing the atomic bomb to the Soviets. The Rosenbergs were found guilty in 23 days and sentenced to the electric chair in one week. After two years of appeals Ethel and Julius were shocked to death at Sing Sing.
    Since then, US nuclear secrets and Loral missile guidance technology were sold to or stolen by the Chinese on the Clinton watch. National Security Adviser Sandy Berger, who paid a $23,000 fine for not selling his oil stock to avoid a conflict of interest in government, allegedly did not inform President Clinton of the espionage for over a year. Then the House Government Reform Committee found reported SB smuggled out or destroyed original, uncopied, univentoried top secret terrorism documents in his BVDs to protect his boss. SB got a fine without jail time and resigned his law license to avoid further examination by the Bar. He now chairs an international investment fund!
    Wen Ho Lee got $1.6 M and an apology from a Federal Judge for leaking his name to the press before formal charges. Ron Brown died in an airplane crash.
    Meanwhile, on Saturday 10 October 2009, the day after Holy Day, Taliban insurgents reportedly captured Pakistan Army HQ in Islamabad, where Pakistan nuclear codes are. They reportedly executed simultaneous attacks to control an underground tunnel which accesses the Pakistan nuclear missile arsenals. That’s why the Pakistan Army is there. No wonder the Big 4 are net long oil here now. It is worth remembering oil revenues, stock revenues and earnings and b0nd yields are way below 2006 peaks, consistent with the big deflation picture. No amount of funny government money can overcome a trend whose time has come…

  • Trumpet October 19, 2009, 6:30 pm

    Rick, yes it is easy to see what there simply is: prices for a broad range of commodities are rising for several months now while some real estate markets are falling, by far not all. And real estate, however important. is just one component. What is hard to forsee for me is how the underlying market forces will play out. Will they suppress rising prices, even bring a new crash like in winter 2008 or will prices rise further. I did read several of your previous articles on the issue but did not find or may have missed the answer to this question. If energy, grains and metals will rise further, yes leveraging these would be a good means of protecting against losses in other assets as mentioned in Gary Paul’s comment and your answer to it. Would be grateful to read your explanation on whether and why deflationary forces should prevail and suppress commodity prices for energy, metals, grains, etc.

    &&&&&&&&

    Choose to ignore the 800-pound gorilla if you want, but real estate is not exactly incidental; rather, it is the main source of collateral for a global derivatives bubble leveraged almost into the quintillions of dollars. You need to read my 100,000 words more carefully, since they address all of the additional questions you have posed. Honest.. RA

  • Fallingman October 19, 2009, 5:21 pm

    I also conceived of the Taliban as a ragtag bunch of lightly armed ground fighters. This morning I heard that they had anti-aircraft batteries sufficient to deter Pakistani fighter jets. Got the info from NPR, so take it for what it’s worth.

    If it’s true, where did these jokers get AAA and the means to maintain and supply this equipment, especially given that these installations are located within the borders of Pakistan? How much money have we funneled to our “ally” there to deal with this sort of problem? Wow, that effort has certainly gone well. Borrowed money well spent! Not that it was ever meant to do anything but line the pockets of the connected.

    On a related subject, I keep seeing Obama bumper stickers next to Peace bumper stickers on cars.. Ha. Pure fantasy. He’s just another warlord in Ball and Cheney’s War on a Tactic, which he has now embraced and expanded. A con job indeed.

    Ron Paul is the only one who would have gotten us out of this rat’s nest in Afghanistan and Pakistan by now. But then again, he would have had to have actually gotten elected and stayed alive long enough to serve. An impossibly tall order. I guess we’ll just have to be content to keep fighting for peace and giving up freedom in order to be free.

    Perpetual war against a a tactic. Now there’s a plan the fascisti gotta love.

    TW

  • Ben October 19, 2009, 3:29 pm

    http://www.ronpaul.com/2009-10-05/ron-paul-free-trade-instead-of-bombs-and-bribes/

    I hasten to add that, once time upon a time, Saddam, the Taliban… were “friends” of the United States. So one must wonder if a Pakistani victory (whatever the heck that means) would make the world any safer. And as someone else already pointed out, they don’t seem to be showing much zeal for the task. I’ve read this in other sources as well. So… how much more will a false sense of security cost, then, bearing in mind that whether they get it or not, we probably won’t be any safer.

    In other news… Is it me, or is there a common theme among all these Monday morning topics? Falsehoods, decpetions, etc and the over-reactions to them? Particularly the ending. Balloons (bubbles) way up in the sky (what goes up… Well, I’ll be! It was just a media hoax after all!)

  • Trumpet October 19, 2009, 2:31 pm

    re inflation/deflation: to start with: I really do appreciate Rick’s thoughts published on this site. However I feel for some time now that the comments on deflation are a bit less sophisticated than used to. I well understand that there are strong deflationary forces at work. However at the same time the confidence in fiat money is decreasing. So those sellers who have to sell goods that are scarce, do ask for more fiat money than before. And some goods are actually being chased by money: After a precipitous fall in 2008, at present the CRB CCI index has been rising since Febuary 2009 by roughly 28%. That is inflation, albeit started from a low base and still 30% below its 2008 peak. What makes you so sure that the CRB and the broad range of goods represented by that index will turn down again or stay low? Or could it proceed to rise or even suddenly accelerate steeply?

    &&&&&

    It doesn’t take much sophistication to see what simply is, Trump. You should check out my archive, because I’ve written 100,000 words on the subject, some of it “sophisticated,” some not. I think I’ve covered all of the arguments, but maybe you can find a stone unturrned. Certainly not the stones you’ve mentioned, though. RA

  • Jeff Kahn October 19, 2009, 1:54 pm

    Pakistan, not Iraq, not Iran, not al Quaeda, not the Taliban, yes, the US supported government in Pakistan has always been the biggest threat to the US. They control an untold number of sophisticated nuclear devices. And they are corrupt, unstable and hated by most of their own population. Wake up.

  • Gary Paul October 19, 2009, 10:26 am

    re: inflation.
    Well, gold, oil and the markets are UP. Does that count for anything? 😉

    &&&&&&

    If you’re well leveraged in all three, perhaps it will offset a portion of the value that your home has lost. RA

  • billwilson October 19, 2009, 4:10 am

    Re Pakistan…remember that it is the locals holding off the insurgents (Pakistani military). Just as Americans were able to hold off the British 230 odd years ago (on their home turf), and the Vietnamese the Americans, so too can the locals in South Waziristan be expected to fight with all they have. Not really a surprise, they have been doing it for centuries (at least). What is surprising is that Pakistan is trying to do with with only 30,000 troops in a very large geographic area. It almost looks like they are not really trying, again.

    As Edward mentions above the GWOT is one huge con-job. Terror as a tactic has always existed and always will. (just as drugs and prostitution and alcohol and whatever trumped up excuse for war has existed before).

    The Taliban are not AQ. Negotiate with the Taliban, bring elements of them into the Afgan government, they obviously have some support in the country. Better to have them where you can see them.

    I would prefer to nominate Showdown in Chicago as an apt topic for Monday. http://www.showdowninchicago.org/
    Until the financial system gets “fixed” there will be no turning the corner. And with Wall Street money on one side, there had better be a pretty big “public” on the other side or nothing is going to happen.

  • Daman Prakash October 19, 2009, 3:07 am

    Those who live under perpetual danger of such sick minds and destructive tendencies only know the extent of threat these misguided human missiles in the name of al Qaeda can wreck.

    My country has suffered extensive damage of human life and property. They could never destroy our psyche but we lost many precious lives. We spend billions guarding our internal and external security for specific task of pushing back AQ infiltrators.

    AQ could have begun with help from US forces or ISI of Pakistan with initial funding and training by them. US wanted to keep Russians at bay and ISI wanted to wreck vengeance on India for their worst defeat in 1971 Bangladesh War. These agencies have now lost control over them.

    These AQ guys catch young poor people and brainwash them to act as human bomb in the so called service of Jihad and revenge and wreck maximum damage to the civil society of India and Pakistan.

    Opium trade is certainly a factor but why target cities like New York, London, Mumbai, Delhi which are prime economic centers?

    The threat to the world is clear and real from AQ . Those who think that it is all fictional just invite death and destruction at their door step. Somebody is waiting there with his finger tip firmly on the lower part of his body to blow himself and other innocents to pieces.

  • Edward October 19, 2009, 1:18 am

    To subscribe to the GWOT, a kind of damnable nonsense, especially if one operates under its core assumptions, is to render oneself a dupe plain and simple. Yes, terrorists do exist, but, if one has an open mind, one can have a very interesting discussion about just who and what qualify. In any case, whatever way one chooses to slice the pita, with respect to The Taliban, however hideous they may be, they are no threat to the United States, nor have they ever been. As for the vaunted Al Queda, I choose to hew to the revelations of former F.B.I. official, Sibel Edmonds, http://en.wikipedia.org/wiki/Sibel_Edmonds that AQ are more fiction than fact, a concocted phantom menace that serves various malevolent actor’s foul ends.

    I would like to make a basic assertion regarding the essence of U.S. Government functioning, which is that, in the main, it operates as a form of kleptocracy acting, for the most part, on behalf of an elite group of very powerful players. With respect to the larcenous activities of the U.S. government as they pertain to foreign policy, as opposed to the much better documented domestic brand of thievery, (at least as documented in the blogosphere as opposed to the bought and paid for MSM) I would further like to assert that the U.S. presence in Afghanistan, in particular, has more to do with controlling the heroin trade then dealing a death blow to the shadowy world of “terrorists.” The rabbit hole of corruption where managing the heroin trade is concerned is vast as befits a global industry that generates gross profits-no pun intended- in the trillions, and how it operates is not for mere plebes like me to know however, here are a few bits of data in support of my thesis which come to me from The Golden Jackass.

    When the Taliban controlled Afghanistan, the opium trade was approximately 135 metric tons, presently in the aftermath of U.S. occupation, opium output is said to be closer to 15 thousand metric tons, an eleven fold increase. The estimated value at wholesale for 15 thousand metric tons of heroin is 150 billion dollars. The street value for that same amount is approximately 5.4 trillion dollars. U.S. security agencies earn an estimated 350 to 370 billion in income from the narcotics trade. Afghanistan happens to be the largest producer of heroin in the world.

    Ponder all this if you will and consider the possibility that it is far more likely, given what is at stake vis a vis drug profits, that the U.S. military is acting as much, or more, as a tool for control of one of the planet’s most lucrative industries than it is a vehicle for the control of regional terrorism.

    We are in Afghanistan to control the heroin trade as much as anything else. A few facts

  • Peter Montgomery October 19, 2009, 12:01 am

    the world turning against Israel is my number one concern

    Israeli military stigmatized to block strike against Iran’s nuclear facilities
    http://www2.debka.com/article.php?aid=1409

    Israel outraged by UN Human Rights Council endorsement of controversial Goldstone report
    http://www2.debka.com/headline.php?hid=6323