Archive for January, 2012

BIG BROTHER INTERNET

By Paul Craig Roberts

Dear friends: I am pleased to bring to you Gerald Celente’s assessment of the threats posed to Internet freedom. Celente’s Trends Journal is one of the most insightful publications of our era. PCR

Do you remember the Safe-Cyber instructions they taught you in the mandatory Computer Ed class (operated by the National Institute of Standards and Technology)? First you fire up your Secured Computing Device (SCD) and its hardware token authenticator.

Then you enter the six-digit algorithmically generated password displayed (a new one flashes every 60 seconds) and are asked to supply your biometric identifier. You place your thumb on the built-in fingerprint pad, click, and wait for the Internet connection to begin. But it doesn’t.

Instead, the screen goes black for a second before the dreaded words appear: “Malware has been detected on this SCD. As mandated by federal law, it has been placed in quarantine.” Then the machine shuts down.

This is not just conjecture, but an imminent scenario. Policies, such as the White House proposed “National Strategy for Trusted Identities in Cyberspace,” which will transform the character, culture and freedom of the Internet, are already in place. The 20 cybersecurity-related bills introduced in the Senate in 2011, and the dozen introduced in the House of Representatives, have wound their way through committees and, according to Senator Harry Reid, are scheduled to be voted on in the first quarter of 2012. Almost all of them, with the blessing of the White House, would make the Department of Homeland Security the overseer of private-sector networks.

Considering the apocalyptic rhetoric coming from Washington and the ranks of cybersecurity experts – echoed by media reports that portray every picayune data breach as Armageddon – it would appear that the vulnerability of the Internet has been underplayed for many years.

In the Internet’s start-up decades, both industry and government were committed to establishing an atmosphere of trust that would draw the public into conducting more and more digital business. Though data breaches, theft of trade secrets, identity theft and bank robbery have been a fact of Internet life since its beginnings, there were few laws requiring disclosure. Banks and credit card firms ate their losses as a cost of doing business, and the giant corporations kept mum rather than roil the public. Recently, the pendulum has swung in the other direction and a raucous alarm has been sounded regarding the great danger posed by the Internet.

The Nation is at a crossroads. The globally-interconnected digital information and communications infrastructure known as “cyberspace” underpins almost every facet of modern society and provides critical support for the U.S. economy, civil infrastructure, public safety, and national security. This technology has transformed the global economy and connected people in ways never imagined. Yet, cybersecurity risks pose some of the most serious economic and national security challenges of the 21st century. The digital infrastructure’s architecture was driven more by considerations of interoperability and efficiency than of security. Consequently, a growing array of state and non-state actors are compromising, stealing, changing, or destroying information and could cause critical disruptions to U.S. systems. (White House Cyberspace Policy Review, 2011)

While there may be other factors behind the current wave of cybersecurity alarmism, we have identified three major forces: The Government, the Cybersecurity-Industrial complex, and the so-called “Hacktivists.”

The Hacktivists LulzSec and Anonymous, the most-publicized of the hacktivists, along with a growing community of ad hoc cyberactors, have had a multi-faceted impact on the cybersecurity environment that goes far beyond the number of hackers at work or the amount of actual damage their exploits have inflicted.

They have skillfully publicized their outsized, headline-ready cyberintrusions. Their attacks, which are something other than the garden variety cybercrime, have compromised the web assets of Sony, the CIA, Fox News, the Church of Scientology, Bank of America and many more. Beyond the financial damage and security breaches, they’ve created a public relations nightmare forcing these major institutions to go public with what they would otherwise go to great lengths to conceal.

As a result, attention has been focused on the inadequacies of Internet security. If organizations as large, powerful and security-conscious as these are vulnerable, who then is safe? Not only have the targets been breached and embarrassed, consumer trust in the Internet has also been shaken.

These high profile, anarchic Internet exploits – compounded by the role of social media in evading and undermining government control of the political and media arena (Arab Spring, Occupy Wall Street, etc.) – have intensified government efforts to clamp down on the Internet … while providing the media with scary cyber-stories to further that agenda.

The Government The US government agenda to control the Internet is at least a decade old. Just three months after the Bush White House created the Department of Homeland Security, it issued “The National Strategy to Secure Cyberspace.” The document begins:

My Fellow Americans:
The way business is transacted, government operates, and national defense is conducted have changed. These activities now rely on an interdependent network of information technology infrastructures called cyberspace. The National Strategy to Secure Cyberspace provides a framework for protecting this infrastructure that is essential to our economy, security, and way of life.

In the past few years, threats in cyberspace have risen dramatically. The policy of the United States is to protect against the debilitating disruption of the operation of information systems for critical infrastructures and, thereby, help to protect the people, economy, and national security of the United States.

Nearly a decade later, the basic message from the White House sounds much the same, if louder and more urgent. But there is a big difference. President Obama, and the rest of the Beltway insiders, have now formally defined cyberspace as a “strategic national asset.”

On the face of it, this appears to be a reasonable approach for a world that has become, in a relatively short time, totally dependent on digital resources. Unfortunately, it is an approach that provides a straight path to the militarization of the Internet and the loss of liberty that will follow. It is an approach that will elevate the most common forms of cybercrime (bank robbery, credit card theft) to the high-alert status of a cyberwar attack.

This government mindset will lead to the same abrogation of individual rights in cyberspace as the National Defense Appropriations Act of 2012 has codified in “Battlefield America.”

Given the integrated nature of cyberspace, computer-induced failures of power grids, transportation networks, or financial systems could cause massive physical damage and economic disruption. DoD operations – both at home and abroad – are dependent on this critical infrastructure. As military strength ultimately depends on economic vitality, sustained intellectual property losses erode both U.S. military effectiveness and national competitiveness in the global economy. Cyber hygiene must be practiced by everyone at all times; it is just as important for individuals to be focused on protecting themselves as it is to keep security software and operating systems up to date. (Department of Defense Strategy for Operating in Cyberspace, July 2011)

Many Internet experts and cybersecurity professionals have deemed 2011 “The Year of the Hack,” in recognition of the unending stream of headlines related to data breaches and thefts. We believe that – aside from any real uptick in cybercrime or cyberwarfare skirmishes – this perception is the result of the government’s determination to soften up the public to meekly accept an upcoming barrage of Internet regulation. It is a digital-age version of the tried and true fear mongering that is always employed to further empower the president and further enrich the military/industrial and Homeland Security complex. The government says it’s not fear mongering, just education.

The national dialogue on cybersecurity must begin today. The government, working with industry, should explain this challenge and discuss what the Nation can do to solve problems in a way that the American people can appreciate the need for action. People cannot value security without first understanding how much is at risk. Therefore, the Federal government should initiate a national public awareness and education campaign informed by previous successful campaigns. (White House Cyberspace Policy Review, 2011)

The Prominence of the Non-military Aspects of Warfare. Non-military means of warfare, such as cyber, economic, resource, psychological, and information-based forms of conflict will become more prevalent in conflicts over the next two decades. In the future, states and non-state adversaries will engage in “media warfare” to dominate the 24-hour news cycle and manipulate public opinion to advance their own agenda and gain popular support for their cause. (“Global Trends 2025,” National Intelligence Council, 2008)

The Money Card A key point being used to “educate” the public is the putative astronomical monetary loss caused by cybercrime in all its forms. There is, of course, no way to ascertain the validity of these numbers or even to figure out just what kind of losses are included in the estimates, which are generally arrived at by the large cybersecurity corporations. Some loss-figures appear to include the fall in a company’s stock price that usually follows revelation of a major hack (but doesn’t adjust that figure when the stock price climbs back up), as well as adding in an arbitrary sum attributable to time lost in recovery.

The largest global estimate of money lost to cybercrime currently floating around – as totted up by McAfee, the world’s largest cybersecurity company and endorsed by the White House – is $1 trillion a year. Symantec Corp., another cybersecurity giant, calculates the annual toll of global cybercrime to be about $388 billion. For dramatic impact, Symantec notes that figure is greater than the black market in marijuana, cocaine and heroin combined. Either of those (wildly divergent) sums is impressive, but do they mean anything? Or are they just part of a government “education campaign modeled on previous successful campaigns,” such as selling the public on the certainty of WMDs in Hussein’s Iraq?

Far from being broadly based estimates of losses across the population, the cyber-crime estimates that we have appear to be largely the answers of a handful of people extrapolated to the whole population. A single individual who claims $50,000 losses, in an N = 1000 person survey, is all it takes to generate a $10 billion loss over the population. One unverified claim of $7,500 in phishing losses translates into $1.5 billion.

Our assessment of the quality of cyber-crime surveys is harsh: they are so compromised and biased that no faith whatever can be placed in their findings.

There has long been a shortage of hard data about information security failures, as many of the available statistics are not only poor but are collected by parties such as security vendors or law enforcement agencies that have a vested interest in under- or over-reporting. (“Sex, Lies and Cyber-crime Surveys,” Microsoft Research)

The Cybersecurity-Industrial Complex The fear, uncertainty, and doubt (FUD) surrounding cyberspace has helped turn cybersecurity into an enormously profitable business, worth between $60 and $100 billion a year, depending on who’s providing the statistics. The sector is expected to grow 10 percent annually for at least the next five years. You don’t have to attribute any ethical lapses in the cybersecurity industry to recognize that it, like the government, has a great interest in “educating” the public in cybersecurity awareness.

Security experts say that it is virtually impossible for any company or government agency to build a security network that hackers will be unable to penetrate. (Reuters, 27 May 2011)

“I am convinced that every company in every conceivable industry with significant size and valuable intellectual property and trade secrets has been compromised (or will be shortly), with the great majority of the victims rarely discovering the intrusion or its impact …. In fact, I divide the entire set of Fortune Global 2,000 firms into two categories: those that know they’ve been compromised and those that don’t yet know.” – Dmitri Alperovitch, Vice President of Threat Research for McAfee

The military-industrial complex of the Cold War era has morphed into the cybersecurity-military/industrial-Homeland Security complex of the Cyber War era … to which there is no end in sight. With the cybersecurity industry creating the technology required to stem the very cyberattacks they are in charge of discovering and monitoring, we face an endless cyberarms race that will undoubtedly be fed on exaggerations of the virtual menace and our vulnerability to it.

On the heels of the fear and hysteria will come the firm push for strict control and regulation of the Internet. It will be championed by government and industry as the necessary response to cyberwar, cyberterrorism, and cybercrime which, since cyberspace is considered a “strategic national asset,” are essentially all the same.

The Stop Online Piracy Act (SOPA) for instance, which is scheduled for a vote in 2012, will take a page from the National Defense Appropriation Act of 2012. In order to protect the rights of copyright holders to profit from their intellectual property, SOPA would permit the dissolution of due process and open the door wide to censorship and the denial of the right to free speech. The bill, supporters suggest, is not just about recovering the billions lost to bootlegged movies and music, rather, it’s about protecting the military strength that ultimately depends on economic vitality.

We agree with The Electronic Frontier Foundation, which has called SOPA the most extreme, anti-Internet, anti-privacy, anti-free speech copyright proposal in US legislative history. It is, however, only one of many legislative proposals likely to be steamrollered through Congress in the coming year.

Computer security expert Eugene Kaspersky, co-founder of Kaspersky Labs, envisions the “passportization” of the Internet. In his opinion, to access critical online services, such as banking or electronic voting, “it should be made mandatory to log-on only with the use of a unique personal identifier [for example, a token – a sort of cyber-passport] and establish a secure authoring connection.”

Microsoft has proposed what it calls a “public health model” for the Internet. Cybercitizens would be required to have a “clean bill of health,” make their computers open to inspection, and, if contaminated by a virus or other malware, be prepared for quarantine.

President Obama’s National Strategy for Trusted Identities in Cyberspace is pushing for development and public adoption of Internet user authentication systems that will function as a driver’s license for the cyberhighway.

Government control of the flow of information will strike a blow against Internet anonymity and the free speech it has made possible. Driver’s license, bill of health, passport, whatever you call it – it’s all about the ability to track and control the individual. Today, traffic in copyrighted digital material is the criminal behavior supposedly under attack; tomorrow, it will be the ability to speak out against corrupt government.

Hello, Big Brother.

Trendpost: The demand for ever-more effective cybersecurity tools to counter the ever-more inventive depredations of cybercriminals and cyberwarriors will be with us far into the foreseeable future. Clearly, this situation will create many jobs, both for the formally educated and the creative hacker. In addition, The National Initiative for Cybersecurity Education – established to provide cyber-awareness training to students in Kindergarten through post-graduate programs – will need many specialized teachers.

Somewhat farther along on the timeline, there is a high likelihood that the manufacture of cyber-components will be repatriated to the US. The 2011 Department of Defense’s “Strategy for Operating in Cyberspace” notes: “The majority of information technology products used in the United States are manufactured and assembled overseas. The reliance of DoD on foreign manufacturing and development creates challenges in managing risk at points of design, manufacture, service, distribution, and disposal.”

A high probability exists that 2012 will bring revelations about contamination in the global IT hardware and software supply chain and proof that computer components are providing our “enemies” with entry to critical networks or transmitting sensitive information to them. This will turn the DoD’s security concern into a hot imperative.

More from Gerald Celente ↓

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Dr. Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. For further information and articles please visit http://www.paulcraigroberts.org/

Copyright Paul Craig Roberts. This article is published with his permission.

 

NIGERIA. CHAOS CIVIL WAR AND THE IMF

By F. William Engdahl

Nigeria, Africa’s most populous nation and its largest oil producer, is from all evidence being systematically thrown into chaos and a state of civil war. The recent surprise decision by the government of Goodluck Jonathan to abruptly lift subsidies on imported gasoline and other fuel has a far more sinister background than mere corruption and the Washington-based International Monetary Fund (IMF) is playing a key role. China appears to be the likely loser along with Nigeria’s population.

The recent strikes protesting the government’s abrupt elimination of gasoline and other fuel subsidies, that brought Nigeria briefly to a standstill, came as a surprise to most in the country. Months earlier President Jonathan had promised the major trade union organizations that he would conduct a gradual four-stage lifting of the subsidy to ease the economic burden. Instead, without warning he announced an immediate full removal of subsidies effective January 1, 2012. It was “shock therapy” to put it mildly.

Nigeria today is one of the world’s most important producers of light, sweet crude oil—the same high quality crude oil that Libya and the British North Sea produce. The country is showing every indication of spiraling downward into deep disorder. Nigeria is the fifth largest supplier of oil to the United States and twelfth largest oil producer in the world on a par with Kuwait and just behind Venezuela with production exceeding two million barrels a day. 1

The curious timing of IMF subsidy demand

Despite its oil riches, Nigeria remains one of Africa’s poorest countries. The known oilfields are concentrated around the vast Niger Delta roughly between Port Harcourt and extending in the direction of the capital Lagos, with large new finds being developed all along the oil-rich Gulf of Guinea.  Nigeria’s oil is exploited and largely exported by the Anglo-American giants—Shell, Mobil, Chevron, Texaco. Italy’s Agip also has a presence and most recently, to no one’s surprise, the Chinese state oil companies began seeking major exploration and oil infrastructure agreements with the Lagos government.

Ironically, despite the fact that Nigeria has abundant oil to earn dollar export revenue to build its domestic infrastructure, government policy has deliberately let its domestic oil refining capacity fall into ruin. The consequence has been that most of the gasoline and other refined petroleum products used to drive transportation and industry, has to be imported, despite the country’s abundant oil. In order to shield the population from the high import costs of gasoline and other refined fuels, the central government has subsidized prices.

Until January 1, 2012, that is. That was the day when, without advance warning President Goodluck Ebele Azikiwe Jonathan announced immediate removal of all fuel subsidies. Prices for gasoline shot up almost threefold in hours from 65 naira (35 cents of a dollar) a liter to 150 naira (93 cents). The impact rippled across the economy to everything including prices of grains and vegetables.2

In justifying the move, Central Bank Governor Lamido Sanusi insisted that “The monies will be used in provision of social amenities and infrastructural development that will benefit Nigerians more and save the country from economic rift.”3 President Goodluck Jonathan says he is phasing out the subsidy as a part of a move to “clean up the Nigerian government.” If so how he plans to proceed is anything but apparent.

The huge unexpected price hike for domestic fuel triggered nationwide protests that threatened to bring the economy to a halt by mid-January. The president deftly took the wind out of protester sails by announcing a partial rollback in prices, still leaving prices effectively double that of December. The trade union federation immediately called off the protests. Then, revealingly, Goodluck Jonathan’s government ordered the military to take to the streets to “keep order” and de facto prevent new protests. All that took place during one of the bloodiest waves of bombings and murder rampages by the terrorist Boko Haram sect creating a climate of extreme chaos.4

The smoking gun of the IMF

What has been buried from international accounts of the unrest is the explicit role the US-dominated International Monetary Fund (IMF) played in the situation. With suspicious timing IMF Managing Director Christine Lagarde was in Nigeria days before the abrupt subsidy decision of President Jonathan.5 By all accounts, the IMF and the Nigerian government have been careful this time not to be blatant about openly announcing demands to ends subsidies as they were in Tunisia before food protests became the trigger for that country’s Twitter putsch in 2011.

During her visit to Nigeria Lagarde said President Jonathan’s ‘Transformation Agenda’ for deregulation “is an agenda for Nigeria, driven by Nigerians. The IMF is here to support you and be a better partner for you.” 6 Few Nigerians were convinced.  On December 29 Reuters wrote, “The IMF has urged countries across West and Central Africa to cut fuel subsidies, which they say are not effective in directly aiding the poor, but do promote corruption and smuggling. The past months have seen governments in Nigeria, Guinea, Cameroon and Chad moving to cut state subsidies on fuel.” 7

Further confirming the role US and IMF pressure on the Nigerian government played, Jeffery Sachs, Special Adviser to the United Nations (UN) Secretary General, during a meeting with President Jonathan in Nigeria in early January days after the subsidy decision, Sachs declared Jonathan’s decision to withdraw petroleum subsidy  “a bold and correct policy.” 8

Sachs, a former Harvard economics professor became notorious during the early 1990’s for prescribing IMF “shock therapy” for Poland, Russia, Ukraine and other former communist states which opened invaluable state assets for de facto plundering by dollar-rich western multinationals. 9

Making the sudden decision to end the domestic fuel subsidy even more suspicious is the manner in which Washington and the IMF are putting pressure on only select countries to end subsidies. Nigeria, whose oil today sells for the equivalent of $1 a liter or roughly $3.78 a US gallon, is far from cheap. Brunei, Oman, Kuwait, Bahrain, Qatar, Saudi Arabia all offer their petrol very cheap to their people. The Saudis sell their oil at 17 cents, Kuwait at 22 cents.10 In the US gasoline averages 89 cents a liter.11

That means the IMF and Washington have forced one of the poorest economies in Africa to impose a huge tax on its citizens on the implausible argument it will help eliminate corruption in the state petroleum sector. The IMF knows well that the elimination of subsidies will do nothing about corruption in high places.

Were the IMF and World Bank genuinely concerned with the health of the domestic Nigerian economy, they would have provided support for rebuilding and expanding a domestic oil refinery industry that has been let to rot so that the country need no longer import refined fuels using precious state budget resources to do so.  The easiest way to do that would be to expedite a two-year-old deal between China and the Nigerian government to invest some $28 billion in massive expansion of the oil refinery sector to eliminate need for importing foreign gasoline and other refined products.

Quite the opposite—the criminal cabal inside NNPC and the Government making huge profits on the old subsidy system are suddenly making double and potentially triple more to maintain the old corrupt import system, and, of course, to sabotage Chinese refinery construction that could put an end to their gravy train.

Cutting their nose to spite the face…

Rather than benefit ordinary Nigerians as the IMF proclaims to want, the elimination of the subsidies has further pauperized the 90 per cent living on less than $2 a day, according to Mallam Sanusi Lamido Sanusi, the Nigerian Central Bank governor.12 An estimated 40 million Nigerians are unemployed in the country of 148 million.

Because transport costs are a significant factor in delivery of food to the cities, food price inflation has soared along with costs of public transportation for the majority of poorer Nigerians. According to the  Nigerian Leadership Sunday, “prices of commodities which shot up as a fallout of the fuel pump price increase have refused to come down.” Everything from street vegetable sellers to carwashes to roadside photographers are feeling the shock of the rise in fuel prices. Unemployment is rising as small businesses fold. 13

The argument of the IMF and  the Jonathan Administration  is that by freeing fuel prices, funds would be available to  more social services and rebuild Nigeria’s “infrastructure.” Both the IMF and the Government know it would have been far more economically viable to replace the current corrupt system of importing refined gasoline and fuels with investing in rebuilding Nigeria’s domestic refining capacity.

Son Gyoh of the Nigerian Awareness for Development organization stated, “Would it not be more expedient to pressure government to service the refineries to full production capacity given the implications on overhead and competitiveness for local industries?”  14

Gyoh pointed to the source of the problem: “Why have successive governments left the refineries in a state of disrepair while spending huge on subsidy? Is there any chance that the savings from subsidy withdrawal will go directly into rehabilitating the refineries? Does deregulation imply NNPC will no longer operate a monopoly in importation of refined petroleum product or is this lobby a self-serving lifeline to continue its monopoly? ” He concludes, “In any case, there is good reason to doubt subsidy removal will solve the fuel scarcity problem as the cabal will only regroup to change tactics, a fact Nigerians are only too aware of.” 15

After Nigeria partly nationalized its oil sector in the late 1970’s they also took control of Shell Oil’s Port Harcourt I refinery. In 1989 Port Harcourt II refinery was built. Both refineries fell into serious disrepair after 1994 when the Abacha military dictatorship cut the “take” of the Nigerian National Petroleum Company (NNPC) from domestic sale of refined oil products such as gasoline from 84% to 22%. That caused a cash crisis for NNPC and a halt to refinery maintenance. Today only one of four refineries operates at all.16

What developed since was a system of NNPC importing foreign gasoline and other refined products for Nigeria’s domestic needs, naturally at a far more expensive cost. The price subsidies were to relieve that higher import cost, hardly a sensible solution but a very lucrative one for those corrupt elements in the state and private sector making a killing, literally, off the import process.

NNPC criminal enterprise

The IMF is well aware of the real cause of Nigeria’s fuel industry problems. A Nigerian legislative committee examining the sources of the industry’s problems recently released a report documenting that at least $4 billion annually is taken from taxpayers in fuel industry corruption with the state Nigerian National Petroleum Company (NNPC) at the center. According to the commission, “every day, fuel importers drop off 59 million liters of fuel. The country consumes 35 million liters daily. That leaves 24 million liters of oil available for smugglers to export, paid for by government fuel subsidies. This costs the Nigerian people roughly $4 billion yearly, according to Reuters.” 17

The Nigerian government has said that the 7.5 billion dollars spent yearly on fuel subsidies could be used to provide desperately needed infrastructure. But they omit any mention of the rampant siphoning off of $4 billion of oil by black market smugglers, reportedly with connivance of high NNPC government officials, to sell to neighboring countries at a hefty profit. The refined imported fuel is reportedly smuggled into neighboring countries like Cameroon, Chad and Niger where petrol prices are far higher, according to Abdullahi Umar Ganduje, Deputy Governor of Kano State.18

China as IMF target?

One major geopolitical factor that is generally ignored in recent discussion of Nigerian oil politics is the growing role of China in the country. In May 2010 only days after President Jonathan was sworn in, China signed an impressive $28.5 billion deal with his government to build three new refineries, something that in no way fit into the plans of either the IMF or of Washington or of the Anglo-American oil majors.19

China State Construction Engineering Corporation Limited (CSCEC) signed the deal to build three oil refineries with Nigerian National Petroleum Corporation (NNPC), in the biggest deal China has made with Africa. Shehu Ladan, head of NNPC, said at the signing ceremony that the added refineries would reduce the $10 billion spent annually on imported refined products. As of January 2012 the three Chinese refnery projects were still in the planning stage, reportedly blocked by the powerful vested interests gaining from the existing corrupt import system.20

A report in China Daily last November quoted Nigeria’s Olusegun Olutoyin Aganga, the minister of trade and investment that Nigeria was seeking added Chinese investors for its energy, mining and agribusiness industries. Last September on a visit to Beijing, Nigeria central bank governor Lamido Sanusi  announced his country planned to invest 5 percent to 10 percent of its foreign exchange reserves in China’s currency, the renminbi (RMB) or yuan, noting that he sees the yuan becoming reserve currency. In 2010 China’s loans and exports to Nigeria exceeded $7 billion, while Nigeria exported $1 billion of crude oil, Sanusi stated.21

Until now Nigeria has held some 79% of her foreign currency reserves in dollars, the rest in Euro or Sterling, all of which look dicey given their financial and debt problems. The move of a major oil producer away from dollars, added to similar moves recently by India, Japan, Russia, Iran and others, augurs bad news for the continued role of the dollar as dominant world reserve currency. 22 Clearly some in Washington would not be happy with that.

The Chinese are also bidding to get a direct stake in Nigeria’s rich oil reserves, until now an Anglo-American domain. In July 2010, China’s CNPC (China National Petroleum Corporation) won four prospective oil blocks -two in the Niger Delta and two in the frontier Chad Basin, with plans to become core investor in the Kaduna refinery, and construction of a double track Lagos-Kano railway.23  As well China’s oil company, CNOOC Ltd has a major offshore production area in Nigeria.

The IMF and Washington pressure to lift subsidies on imported fuels is at this point in question as is the future of China in Nigeria’s energy industry. Clear is that lifting subsidies in no way will benefit Nigerians. More alarming in this context is the orchestration of a major new wave of terror killings and bombings by the mysterious and suspiciously well-armed Boko Haram. This we will look at next in the context of Nigeria’s recent transformation into a major narcotics hub.

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F. William Engdahl is a leading researcher, economist and analyst who’s written on issues of energy, politics and economics for over 30 years. He contributes regularly to publications like Japan’s Nihon Keizai Shimbun, Foresight magazine, Grant’s Investor.com, European Banker and Business Banker International. He’s also a frequent speaker at geopolitical, economic and energy related international conferences and is a distinguished Research Associate of the Centre for Research on Globalization where he’s a regular contributor. He is also the author of A Century of War: Anglo-American Oil Politics, Full Spectrum Dominance and the New World Order. He may be reached via his website at www.engdahl.oilgeopolitics.net 

Copyright F. William Engdahl. This article is published with his permission.

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Notes:

1John Campbell, Nigeria’s Turmoil and the Outside World, January 12, 2012, accessed in http://blogs.cfr.org/campbell/2012/01/12/nigeria%E2%80%99s-turmoil-and-the-outside-world/#more-3994.

2 Chika Otuchikere and Chibunma Ukwu, Nigeria: Aftermath of Subsidy Crisis Food Prices Hitting Roof Tops, 22 January, 2012, accessed in http://allafrica.com/stories/201201231627.html.

3 Mustapha Muhammad, Nigeria: Billions Siphoned by Corruption Could Have Been Used to Maintain Fuel Subsidy, Inter Press Service, January 11, 2012, accessed in http://www.globalissues.org/news/2012/01/11/12407.

4 Mike Oboh, Boko Haram Islamist Insurgents Kill at Least 178 in Nigeria’s Kano, January 22, 2012, International Business Times, accessed in http://www.ibtimes.com/articles/285620/20120122/boko-haram-islamist-insurgents-kill-178-nigeria.htm.

5 Christine Lagarde, Statement by IMF Managing Director Christine Lagarde at the Conclusion of her Visit to Nigeria, IMF, Washington, Press Release No. 11/478, December 20, 2011, accessed in http://www.imf.org/external/np/sec/pr/2011/pr11478.htm.

6 Ibid.

7 Quoted in Idris Ahmed and Kate da Costa, Nigeria: IMF Pushing the Country to End Subsidy – - Report, 30 December 2011, accessed in http://allafrica.com/stories/201112300791.html.

8 Olutayo Olubi, Fuel subsidy: International conspiracy against Nigerians, National Daily, 15 January 2012, accessed in http://nationaldailyngr.com/index.php?option=com_content&view=article&id=2825:fuel-subsidy-international-conspiracy-against-nigerians&catid=306:business-news&Itemid=561.

9 Ibid.

10 Ibid.

11 Ibid.

12 Ibid.

13 Chika Otuchikere and Chibunma Ukwu, Nigeria Aftermath of Subsidy Crisis:  Food Prices Hitting Roof Tops, 22 January 2012, accessed in http://allafrica.com/stories/201201231627.html.

14 Son Gyoh, Nigeria: The case against removal of fuel subsidy and the argument for deregulated petroleum sub sector, accessed in http://awarenessfordevelopment.org/index.php?option=com_content&view=article&id=66:nigeria-fuel-subsidy.

15 Ibid.

16 MBendi, Oil Refining in Nigeria–An Overview, accessed in http://www.mbendi.com/indy/oilg/ogrf/af/ng/p0005.htm.

17 Heather Murdock, Nigeria finds 4 billion dollars in fuel corruption, January 20, 2012, accessed in http://www.globalpost.com/dispatch/news/regions/africa/nigeria/120119/nigeria-oil-fuel-corruption.

18 Mustapha Muhammad, Nigeria: Billions Siphoned by Corruption Could Have Been Used to Maintain Fuel Subsidy, Inter Press Service, January 11, 2012, accessed in http://www.globalissues.org/news/2012/01/11/12407.

19 Kerri Shannon, China Continues Its Run on African Commodities With $23 Billion Nigeria Oil Deal, Money Morning, May 15, 2010, accessed in http://moneymorning.com/2010/05/15/nigeria-oil-deal/.

20 Gavin du Venage, Everyone is a loser in Nigeria’s fuel subsidy cut and partial restoration, The National, January 24, 2012, accessed in   http://www.thenational.ae/thenationalconversation/industry-insights/energy/everyone-is-a-loser-in-nigerias-fuel-subsidy-cut-and-partial-restoration.

21 China Daily, Nigeria seeking Chinese capital, November 12, 2011, accessed in http://www.chinadaily.com.cn/cndy/2011-11/12/content_14082411.htm.

22 Xinhua, Nigeria bank chief sees yuan becoming reserve currency, September 6, 2011, accessed in http://europe.chinadaily.com.cn/world/2011-09/06/content_13641562.htm.

23 Kayode Ekundayo, Nigeria: China, 2010 Budget and Oil Blocks, Daily Trust (Abuja), 12 July 2010, accessed in http://allafrica.com/stories/201007121319.html

F. William Engdahl is a frequent contributor to Global Research.  Global Research Articles by F. William Engdahl

Radio Cinéola’s ‘Deep Space’ broadcast has landed

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WHY WASHINGTON WANTS ‘FINITO’ WITH PUTIN

By F. William Engdahl

Washington clearly wants ‘finito’ with Russia’s Putin as in basta! or as they said in Egypt last spring, Kefaya–enough!.  Hillary Clinton and friends have apparently decided Russia’s prospective next president, Vladimir Putin, is a major obstacle to their plans. Few however understand why. Russia today, in tandem with China and to a significant degree Iran, form the spine, however shaky, of the only effective global axis of resistance to a world dominated by one sole superpower.

On December 8 several days after election results for Russia’s parliamentary elections were announced, showing a sharp drop in popularity for Prime Minister Putin’s United Russia party, Putin accused the United States and specifically Secretary of State Hillary Clinton of fuelling the Russian opposition protesters and their election protests. Putin stated, “The (US) Secretary of State was quick to evaluate the elections, saying that they are unfair and unjust even before she received materials from the Office of Democratic Institutions and Human Rights (the OSCE international election monitors-w.e.) observers.”[1]

Putin went on to claim that Clinton’s premature comments were the necessary signal to the waiting opposition groups that the US Government would back their protests. Clinton’s comments, the seasoned Russian intelligence pro stated, became a “signal for our activists who began active work with the US Department of State.” [2]

Major western media chose either to downplay the Putin statement or to focus almost entirely on the claims of an emerging Russian opposition movement. A little research shows that, if anything, Putin was downplaying the degree of brazen US Government interference into the political processes of  his country. In this case the country is not Tunisia or Yemen or even Egypt. It is the world’s second nuclear superpower, even if it might still be an economic lesser power. Hillary is playing with thermonuclear fire.
Democracy or something else?

No mistake, Putin is not a world champion practitioner of what most consider democracy. His announcement some months back that he and current President Medvedev had agreed to switch jobs after Russia’s March 4 Presidential vote struck even many Russians as crass power politics and backroom deal-making. That being said, what Washington is doing to interfere with that regime change is more than brazen and interventionist. The same Obama Administration which just signed into law measures effectively ripping to shreds the Bill of Rights of the US Constitution for American citizens[3] is posing as world supreme judge of others’ adherence to what they define as democracy.

Let’s examine closely Putin’s charge of US interference in the election process. If we look, we find openly stated in their August 2011 Annual Report that a Washington-based NGO with the innocuous name, National Endowment for Democracy (NED), is all over the place inside Russia.

The National Endowment for Democracy (NED) is financing an International Press Center in Moscow where some 80 international NGOs can hold press briefings on whatever they choose. They fund numerous “youth advocacy” and leadership workshops to “help youth engage in political activism.” In fact, officially they spent more than $2,783,000 in 2010 on dozens of such programs across Russia. Spending for 2011 won’t be published until later in 2012. [4]

The NED is also financing key parts of the Russian “independent” polling and election monitoring, a crucial part of being able to claim election fraud. They finance in part the Regional Civic Organization in Defense of Democratic Rights and Liberties “GOLOS.” According to the NED Annual Report the funds went “to carry out a detailed analysis of the autumn 2010 and spring 2011 election cycles in Russia, which will include press monitoring, monitoring of political agitation, activity of electoral commissions, and other aspects of the application of electoral legislation in the long-term run-up to the elections.”[5]

In September, 2011, a few weeks before the December elections the NED financed a Washington invitation-only conference featuring the Russian “independent” polling organization, the Levada Center. According to NED’s own website Levada, another recipient of NED money, [6] had done a series of opinion polls, a standard method used in the West to analyze the feelings of citizens. The polls profiled “the mood of the electorate in the run up to the Duma and presidential elections, perceptions of candidates and parties, and voter confidence in the system of ‘managed democracy’ that has been established over the last decade.”

One of the featured speakers at that Washington conference was Vladimir Kara-Murza, member of the federal council of Solidarnost (“Solidarity”), Russia’s democratic opposition movement. He is also “advisor to Duma opposition leader Boris Nemtsov” according to NED. Another speaker came from the right-wing neo-conservative Hudson Institute. [7]

Nemtsov, one of the most prominent figures of the Putin opposition today is also co-chairman of Solidarnost, a name curiously enough imitated from the Cold War days when the CIA financed the Polish Solidarnosc workers’ opposition of Lech Walesa. More on Nemtsov later.

And on December 15, 2011, again in Washington, just as the series of US-supported protests were being launched against Putin, led by Solidarnost and other organizations, the NED held another conference titled, Youth Activism in Russia: Can a New Generation Make a Difference? The featured speaker was Tamirlan Kurbanov, who according to the NED, “most recently served as a program officer at the Moscow office of the National Democratic Institute for International Affairs, where he was involved in developing and expanding the capacities of political and civic organizations; promoting citizen participation in public life, youth engagement in particular.” [8] The National Democratic Institute is an arm of the NED.

The Shady History of The National Endowment for Democracy (NED)

Helping youth engage in political activism is precisely what the same NED did in Egypt over the past several years in the lead up to the toppling of Mubarak. The same NED was instrumental by informed accounts in the US-backed “Color Revolutions” in 2003-2004 in Ukraine and Georgia that brought US-backed pro-NATO surrogates to power. The same NED has been active in promoting “human rights” in Myanmar, in Tibet, and China’s oil-rich Xinjiang province. [9]

As careful analysts of the 2004 Ukraine “Orange revolution” and the numerous other US-financed color revolutions discovered, control of polling and ability to dominate international media perceptions, especially major TV such as CNN or BBC is an essential component of the Washington destabilization agenda. The Levada Center would likely be in a crucial position in this regard to issue polls showing discontent with the regime.

By their description, the National Endowment for Democracy (NED) is a “private, nonprofit foundation dedicated to the growth and strengthening of democratic institutions around the world. Each year, with funding from the US Congress, NED supports more than 1,000 projects of non-governmental groups abroad who are working for democratic goals in more than 90 countries.”[10]

It couldn’t sound more noble or high-minded. However, they prefer to leave out their own true history. In the early 1980’s CIA director Bill Casey convinced President Ronald Reagan to create a plausibly private NGO, the NED, to advance Washington’s global agenda via other means than direct CIA action. It was a part of the process of “privatizing” US intelligence to make their work more “effective.” Allen Weinstein, who helped draft the legislation establishing NED, said in a Washington Post interview in 1991, “A lot of what we do today was done covertly 25 years ago by the CIA.”[11] Interesting. The majority of funds for NED come from US taxpayers through Congress. It is in every way, shape and form a US Government intelligence community asset.

The NED was created during the Reagan Administration to function as a de facto CIA, privatized so as to allow it more freedom of action. NED board members are typically drawn from the Pentagon and US intelligence community. It has included retired NATO General Wesley Clark, the man who led the US bombing of Serbia in 1999. Key figures linked to clandestine CIA actions who served on NED’s board have included Otto Reich, John Negroponte, Henry Cisneros and Elliot Abrams. The Chairman of the NED Board of Directors in 2008 was Vin Weber, founder of the ultraconservative organization, Empower America, and campaign fundraiser for George W. Bush. Current NED chairman is John Bohn, former CEO of the controversial Moody’s rating agency which played a nefarious role in the still-unraveling US mortgage securities collapse. As well today’s NED board includes neo-conservative Bush-era ambassador to Iraq and to Afghanistan, Afghan-American Zalmay Khalilzad.[12]

Putin’s well-rehearsed opposition

It’s also instructive to look at the leading opposition figures who seem to have stepped forward in Russia in recent days. The current opposition “poster boy” favorite of Russian youth and especially western media is Russian blogger Alexei Navalny whose blog is titled LiveJournal. Navalny has featured prominently as a quasi-martyr of the protest movement after spending 15 days in Putin’s jail for partaking in a banned protest. At a large protest rally on Christmas Day December 25 in Moscow, Navalny, perhaps intoxicated by seeing too many romantic Sergei Eisenstein films of the 1917 Russian Revolution, told the crowd, “I see enough people here to take the Kremlin and the White House (Russia’s Presidential home-w.e.) right now…”[13]

Western establishment media is infatuated with Navalny. England’s BBC  described Navalny as “arguably the only major opposition figure to emerge in Russia in the past five years,” and US Time magazine called him “Russia’s Erin Brockovich,” a curious reference to the Hollywood film starring Julie Roberts as a researcher and legal activist. However, more relevant is the fact that Navalny went to the elite American East Coast Yale University, also home to the Bush family, where he was a “Yale World Fellow.” [14]

The charismatic Navalny however is also or has been on the payroll of Washington’s regime-destabilizing National Endowment for Democracy (NED). According to a posting on Navalny’s own blog, LiveJournal, he was supported in 2007-2008 by the NED. [15] [16]

Along with Navalny, key actors in the anti-Putin protest movement are centered around Solidarnost which was created in December 2008 by Boris Nemtsov, Vladimir Ryzhkov and others. Nemtsov is hardly one to protest corruption. According to Business Week Russia of September 23, 2007, Nemtsov introduced Russian banker Boris Brevnov to Gretchen Wilson, a US citizen and an employee of the International Finance Corporation, a financing arm of the World Bank. Wilson and Brevnov married. With the help of Nemtsov Wilson managed to privatize Balakhna Pulp and Paper mill at the giveaway price of just $7 million. The enterprise was sucked dry and then sold to the Wall Street-Swiss investment bank, CS First Boston bank. The annual turnover of the mill was reportedly $250 million. [17]
CS First Boston bank also paid for Nemtsov’s trips to the very expensive Davos World Economic Forum. When Nemtsov became a member of the cabinet, his protégé Brevnov was appointed the chairman of the Unified Energy System of Russia JSC. Two years later in 2009 Boris Nemtsov, today’s “Mr anti-corruption,” used his influence reportedly to get Brevnov off the hook for charges of embezzling billions from assets of Unified Energy System. [18]

Nemtsov also took money from jailed Russian oligarch Mikhail Khodorkovsky in 1999 when the latter was using his billions to try to buy the Russian parliament or Duma. In 2004 Nemtsov met with exiled billionaire oligarch Boris Berezovsky in a secret gathering with other exiled Russian tycoons. When Nemtsov was detailed by Russian authorities for allegations of foreign funding of his new political party, “For Russia without Lawlessness and Corruption,”  US Senators John McCain and Joe Liberman and Mike Hammer of the Obama National Security Council came to support of Nemtsov. [19]

Nemtsov’s close crony, Vladimir Ryzhkov of Solidarnost is also closely tied to the Swiss Davos circles, even founding a Siberian Davos. According to Russian press accounts from April 2005, Ryzhkov formed a Committee 2008 in 2003 to “draw” funds of the imprisoned Khodorkovsky along with soliciting funds from fugitive oligarchs such as Boris Berezovsky and western foundations such as the Soros Foundation. The stated aim of the effort was to rally “democratic” forces against Putin. On May 23, 2011 Ryzhkov, Nemtzov and several others filed to register a new Party of Peoples’ Freedom to ostensibly field a presidential candidate against Putin in 2012.[20]

Another prominent face in the recent anti-Putin rallies is former world chess champion turned right-wing politician, Garry Kasparov, another founder of Solidarnost. Kasparov was identified several years ago as being a board member of a Washington neo-conservative military think-tank. In April 2007, Kasparov admitted he was a board member of the National Security Advisory Council of Center for Security Policy, a “non-profit, non-partisan national security organization that specializes in identifying policies, actions, and resource needs that are vital to American security.” Inside Russia Kasparov is more infamous for his earlier financial ties to Leonid Nevzlin, former Yukos vice-president and partner of Michael Khodorokvsky. Nevzlin fled to Israel on being charged in Russia on charges of murder and hiring contract killers to eliminate “objectionable people” while Yukos vice-president. [21]

In 2009 Kasparov and Boris Nemtsov met with no less than Barack Obama to discuss Russia’s opposition to Putin at the US President’s personal invitation at Washington’s Ritz Carlton Hotel. Nemtsov had called for Obama to meet with opposition forces in Russia: “If the White House agrees to Putin’s suggestion to speak only with pro-Putin organizations… this will mean that Putin has won, but not only that: Putin will become be assured that Obama is weak,” he said. During the same 2009 US trip Nemtsov was invited to speak at the New York Council on Foreign Relations, perhaps the most influential US foreign policy think-tank. Significantly, not only has the US State Department and US-backed political NGOs such as NED poured millions into building an anti-Putin coalition inside Russia. The President personally has intervened into the process.[22]

Ryzhkov, Nemtzov, Navalty and Putin’s former Finance Minister Alexei Kudrin were all involved in organizing the December 25th Moscow Christmas anti-Putin rally which drew an estimated 120,000.[23]
Why Putin?

The salient question is why Putin at this point? We need not look far for the answer.

Washington and especially Barack Obama’s Administration don’t give a hoot about whether Russia is democratic or not. Their concern is the obstacle to Washington’s plans for Full Spectrum Dominance of the planet that a Putin Presidency will represent. According to the Russian Constitution, the President of the Russian Federation head of state, supreme commander-in-chief and holder of the highest office in the Russian Federation. He will take direct control of defense and foreign policy.

We must ask what policy? Clearly strong countermeasures against the blatant NATO encirclement of Russia with Washington’s dangerous ballistic missile installations around Russia will be high on Putin’s agenda. Hillary Clinton’s “reset” will be in the dustbin if it is not already. We can also expect a more aggressive use of Russia’s energy card with pipeline diplomacy to deepen economic ties between European NATO members such as Germany, France and Italy, ultimately weakening the EU support for aggressive NATO measures against Russia. We can expect a deepening of Russia’s turn towards Eurasia, especially with China, Iran and perhaps India to firm up the shaky spine of resistance to Washington’s New World Order plans.

It will take more than a few demonstrations in sub-freezing weather in Moscow and St. Petersburg by a gaggle of corrupt or shady opposition figures such as Nemtsov or  Kasparov to derail Russia. What is clear is that Washington is pushing on all fronts—Iran and Syria, where Russia has a vital naval port, on China, now on Russia, and on the Eurozone countries led by Germany. It has the smell of an end-game attempt by a declining superpower.

The United States today is a de facto bankrupt nuclear superpower.  The reserve currency role of the dollar is being challenged as never since Bretton Woods in 1944. That role along with maintaining the United States as the world’s unchallenged military power have been the basis of the American Century hegemony since 1945.

Weakening the role of the dollar in international trade and ultimately as reserve currency, China is now settling trade with Japan in bilateral currencies, side-stepping the dollar. Russia is implementing similar steps with her major trade partners. The primary reason Washington launched a full-scale currency war against the Euro in late 2009 was to preempt a growing threat that China and others would turn away from the dollar to the Euro as reserve currency. That is no small matter. In effect Washington finances its foreign wars in Iraq, Afghanistan, Syria, Libya and elsewhere through the fact that China and other trade surplus nations invest their surplus trade dollars in US government Treasury debt. Were that to shift significantly, US interest rates would rise substantially and the financial pressures on Washington would become immense.

Faced with growing erosion of her unchallenged global status as sole superpower, Washington appears now to be turning increasingly to raw military force to hold that. For that to succeed Russia must be neutralized along with China and Iran. This will be the prime agenda of whoever is next US President.

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F. William Engdahl is a leading researcher, economist and analyst who’s written on issues of energy, politics and economics for over 30 years. He contributes regularly to publications like Japan’s Nihon Keizai Shimbun, Foresight magazine, Grant’s Investor.com, European Banker and Business Banker International. He’s also a frequent speaker at geopolitical, economic and energy related international conferences and is a distinguished Research Associate of the Centre for Research on Globalization where he’s a regular contributor. He is also the author of A Century of War: Anglo-American Oil Politics, Full Spectrum Dominance and the New World Order. He may be reached via his website at www.engdahl.oilgeopolitics.net 

Copyright F. William Engdahl. This article is published with his permission.

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Notes

[1] Alexei Druzhinin, Putin says US encouraging Russian opposition, RIA Novosti, Moscow, December 8, 2011
[2] Ibid.
[3] Jonathan Turley, The NDAA’s historic assault on American liberty, guardian.co.uk, 2 January 2012, accessed in http://www.guardian.co.uk/commentisfree/cifamerica/2012/jan/02/ndaa-historic-assault-american-liberty.
[4] National Endowment for Democracy, Russia, from NED Annual Report 2010, Washington, DC, published in August 2011, accessed in http://www.ned.org/where-we-work/eurasia/russia.
[5] Ibid.
[6] Ibid.
[7] NED, Elections in Russia: Polling and Perspectives, September 14, 2011, accessed in http://ned.org/events/elections-in-russia-polling-and-perspectives.
[8] NED, Youth Activism in Russia: Can a New Generation Make a Difference?, December 15, 2011, accessed in http://ned.org/events/youth-activism-in-russia-can-a-new-generation-make-a-difference.
[9] F. William Engdahl, Full Spectrum Dominance: Totalitarian Democracy in the New World Order, 2010, edition. Engdahl press. The book describes in detail the origins of the NED and various US-sponsored “human rights” NGOs and how they have been used to topple regimes not friendly to a larger USA geopolitical agenda.
[10] National Endowment for Democracy, About Us, accessed in www.ned.org.
[11] David Ignatius, Openness is the Secret to Democracy, Washington Post National Weekly Edition, 30 September-6 October,1991, 24-25.
[12] F. William Engdahl, Op. Cit., p.50.
[13] Yulia Ponomareva, Navalny and Kudrin boost giant opposition rally, RIA Novosti, Moscow, December 25, 2011.
[14] Yale University, Yale World Fellows: Alexey Navalny, 2010, accessed in http://www.yale.edu/worldfellows/fellows/navalny.html.
[15] Alexey Navalny, emails between Navalny and Conatser, accessed in Russian (English summary provided to the author by www.warandpeace.ru) on http://alansalbiev.livejournal.com/28124.html.
[16] Ibid.
[17] Business Week Russia, Boris Nemtsov: Co-chairman of Solidarnost political movement, Business Week Russia, September 23, 2007, accessed in http://www.rumafia.com/person.php?id=1648.
[18] Ibid.
[19] Ibid.
[20] Russian Mafia.ru, Vladimir Ryzhkov: Co-chairman of the Party of People’s Freedom, accessed in http://www.rumafia.com/person.php?id=1713.
[21] Russian Mafia.ru, Garry Kasparov: The leader of United Civil Front, accessed in http://www.rumafia.com/person.php?id=1518.
[22] The OtherRussia, Obama Will Meet With Russian Opposition, July 3, 2009, accessed in http://www.theotherrussia.org/2009/07/03/obama-will-meet-with-russian-opposition/.
[23] Yulia Ponomareva, op. Cit.