an autodidact meets a dilettante…

‘Rise above yourself and grasp the world’ Archimedes – attribution

Posts Tagged ‘corruption

getting roolly rich in the USA 1: Jeffrey Epstein

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Epstein’s two islands in the Caribbean – Little St James is immediately below the Great one

The Jeffrey Epstein case, in terms of women, girls and exploitation, is something I’m far too squeamish to explore, and of course it’s very very sad and disgusting, but my interest was also piqued by the news that he was/is a hedge fund manager (but maybe not), with mansions and an island and oodles of moolah to invest in all sorts of science projects. This raised many questions. Was he obnoxiously rich to begin with, like little Donny Trump? And what is a hedge fund, and can you legitimately make millions from one?

I’ve never been rich and I’ve never invested in anything, unless you call giving money to Oxfam or UNHCR an investment, so I’m really starting from scratch here. The first definition I’ve found is that a hedge fund is ‘an offshore investment fund, typically formed as a private limited partnership, that engages in speculation using credit or borrowed capital’. So, if this is true, why invest ‘offshore’, and how are you able to do this with money you don’t really have or haven’t earned? I suspect I won’t find easy answers to these questions. The website Investopedia (which sounds immediately suss!) starts with another definition: ‘Hedge funds are alternative investments (?!) using pooled funds that employ different strategies to earn active return, or alpha, for their investors’. Alpha! What a lovely musical note that hits for investors (especially combined with ‘male’). But the mention of pooled funds (e.g. mutual funds and pension funds, as well as hedge funds) might explain how you can make money even if you have little personally to invest. Investopedia also tells us that hedge funds ‘are generally only accessible to accredited investors’, because they’re less regulated than other funds. And we all know that the wealthy are very very keen to have less regulation and oversight than what the Yanks call ‘regular folks’

However, it does seem that, to be an ‘accredited investor’, it helps to be already rich. The term applies to financial institutions such as ‘investment banks’ and corporations as well as individuals. Needless to say, this is a world of which I know absolutely nothing. All I’ve really heard about it is negative – high rollers, corruption, anti-government arrogance and the like – which says much about where I get my information from. Even so, the most objective analysis raises questions – for example, the Australian Corporations Act of 2001 ‘defines “sophisticated investor” [basically synonymous with ‘accredited investor’] so as to exclude them from certain disclosure requirements.’ That rings alarm bells for me – you’d think that these heavy investors would be the last people to be excluded from disclosure. The Act also says that such investors require an accountant’s certificate to the effect that they have a minimum of $2.5 million in net assets or a gross income of $250,000 over each of the previous two years. Presumably they’re not asked about how they acquired such income/assets. And the financial bar is considerably lower in the USA.

Hedge funds have grown in popularity, and as a proportion of the asset management field, over the years. After the GFC of 2007-8 there was an attempt (probably feeble) to rein in the sector. The essential hedge fund strategy (think ‘hedging your bets’) is to receive a positive return regardless of bear or bull markets, by spreading the risk in some clever non-risky way. If you get to be a hedge fund manager (which some reports have claimed Epstein to be, though Wikipedia doesn’t mention this in a fairly comprehensive bio) you get to keep a certain percentage of invested funds for yourself – generally a management fee (maybe 2% of assets) and a performance fee (a substantial percentage of any annual increase in net asset value). You can see how disclosure is essential in payment of such fees, and why the temptation to cook the books would be high.

Epstein seems to have ‘risen’ from humble beginnings. His mother was a ‘homemaker’ and one-time school aide, and his father was a groundsman and gardener, yet Epstein is described, at various periods in his career from the early eighties, as an options trader, a financial consultant, a limited partner (at the dodgy investment bank Bear Stearns), a finance manager and other such vagueries – all despite a patchy scholastic record (but as an autodidact and dilettante I certainly don’t hold that against him). However, one very interesting item stands out….

Back in the eighties, Epstein became an associate of one Steven Hoffenberg, who hired him as a consultant for his company, Tower Financial Corporation (TFC). Epstein was paid $25,000 a month, which to me is an absurdly huge amount for anyone to be paid, though in this world it’s probably peanuts. Even before joining TFC (a collection agency that bought up other people’s debts – and if you think that’s dodgy, read on), Epstein had been bruiting it about among the crooked rich that he was a ‘high-level bounty hunter’, sometimes working for governments or the super-rich to recover embezzled funds, sometimes working for clients to secure embezzled funds. He and Hoffenberg became very close, flying around the world to do their dodgy deals, done not so dirt cheap, but in 1993 TFC collapsed and was exposed as one of the biggest Ponzi schemes in US history, with some $475 million of investor funds vanishing. Epstein, though, had already left the company and managed to escape without charge. Hoffenberg was sentenced to 20 years’ jail, and has always claimed that Epstein was intimately involved in the scheme. In fact, Wikipedia’s brief entry on Hoffenberg ends with this fascinating line:

In July 2019, he claimed that the American financier Jeffrey Epstein was his co-conspirator in the Ponzi scheme.

That’s right now, folks. Presumably he has the evidence for that – so why wasn’t Epstein prosecuted way back then?

Anyway, it appears, surprise surprise, that Epstein’s criminality isn’t restricted to his treatment of the opposite sex, which makes you wonder how many super-rich types who don’t draw attention to themselves vis-a-vis sexual exploitation can be shown to be criminals. And how is it possible to buy what is presumably an American island to use as a tax haven?

Tax havens are always described as ‘offshore’. That’s to say, not a part of the country in which you want to avoid paying taxes. The US site Investopedia underlines its dodginess by providing plenty of info on tax havens (hey man, we’re just tellin’ stuff, not selling’ stuff, I mean, peace off man), as well as providing a list which includes the British (but not the US) Virgin Islands. Epstein owns two of the US Virgin Islands, Great Saint James and Little Saint James, where he has one of his mansions. Great Saint James cost him $18 million in 2016, pretty cheap for an island I would’ve thought, and I can’t find the price he paid for Little Saint James back in 1998. This tiny island was his principal centre of sexploitation, aka Orgy Island by the cognoscenti.

The USA has an international reputation as a bad actor in respect of tax disclosure. With monumental hypocrisy, it implemented the Foreign Account Tax Compliance Act in 2010, requiring or ‘forcing’ (dog knows how) financial firms everywhere in the world to report accounts held by US citizens to their IRS, while at the same time refusing to comply with the OECD’s Common Reporting Standard – the only major nation to do so. To be clear about this the USA demands that other countries share information about US citizens’ offshore dealings, but refuses to share the same information with those countries about foreign investment in the USA. As a result, the USA is arguably now the world’s biggest tax haven. How this works exactly for US citizens like Epstein I’m not sure at this point, but the USA has become, especially over the last decade, one of the easiest places in the world for successful tax evasion, especially through the use of LLCs or shell companies. We’re finding this out through examination of Trump’s criminal activities, but of course I’m far from understanding the detailed nature of LLCs, offshore trusts and the like. I need to lern more.

I’ll end this piece – almost – with a quote from an organisation and site that’s the polar opposite of Investopedia, the Tax Justice Network:

The United States, which has for decades hosted vast stocks of financial and other wealth under conditions of considerable secrecy, has moved up from sixth to third place in our index. It is more of a cause for concern than any other individual country – because of both the size of its offshore sector, and also its rather recalcitrant attitude to international co-operation and reform. Though the U.S. has been a pioneer in defending itself from foreign secrecy jurisdictions, aggressively taking on the Swiss banking establishment and setting up its technically quite strong Foreign Account Tax Compliance Act (FATCA) – it provides little information in return to other countries, making it a formidable, harmful and irresponsible secrecy jurisdiction at both the Federal and state levels.

Of course, none of this clearly explains how Epstein ill-got the wealth to be tax-liable in the first place. Certainly the Ponzi scheme he seems to have gotten away with was one, possibly the main, source, but he seems even before this to have ingratiated himself into the world of dodgy financial entities and personae, presumably through schmoozing and force of personality. Certainly his relationship with Ghislaine Maxwell, daughter of that supremo of repugnant dodginess, Robert Maxwell, is an indication of the world Epstein had become familiar with, a world in which everyone is advising everyone else on how to make money out of nothing and how to retain as much of that money as possible, regardless of anything so inconvenient as the law.

References

https://en.wikipedia.org/wiki/Jeffrey_Epstein

https://en.wikipedia.org/wiki/Hedge_fund

https://www.investopedia.com/terms/h/hedgefund.asp

https://www.investopedia.com/terms/p/ponzischeme.asp

https://en.wikipedia.org/wiki/United_States_as_a_tax_haven

https://www.investopedia.com/terms/t/taxhaven.asp

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https://en.wikipedia.org/wiki/Robert_Maxwell

Written by stewart henderson

July 21, 2019 at 2:14 pm

situation USA 3: the right i word

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Nancy Pelosi – trying to make the best of a bad system

I’ve been saying from the start that impeachment – thankfully not a part of the Westminster system – is a hopelessly politicised process, and that someone like Trump should be dealt with by straightforward, clear-cut law. Unfortunately, when it comes to white-collar crime – which is far from being victimless – the USA doesn’t set a great example. Though of course it’s not the only democratic nation to fail in this regard. However, Trump has pushed white-collar crime about as far as it can go without consequences. Just about all he has going for him presently is Presidential immunity. That’s why his principal aim right now is to extend that present as far into the future as possible, and that’s why I’m predicting that things will get worse. He won’t give up the presidency without a very ugly fight.

Nancy Pelosi has been in a friendly-fire fight with Jerry Nadler over the right i word. She says it’s imprisonment, and of course I agree with her. The USA needs to create clear law wiping out presidential immunity ASAP if it’s to regain the respect of the international community, but of course this won’t be possible until 2021. In the meantime, the House should continue to build its case against Trump, just as law officials are doing outside of Congress.

CNN ‘Editor-at-large’ (what does that mean? Editor who should be in prison?) Chris Cillizza has written a strange and quite silly piece, saying Trump’s imprisonment is ‘not likely’. His first point is that Pelosi, by bringing up the right i word, is trying to show Nadler and others that, by opposing the rush to impeachment, she’s not being soft, but realistic. It’s indeed an incredible thing that the Senate Republicans are largely choosing to stand by their flim-flam man, but it’s a fact, and proof of the tainted, politicised process that impeachment is. But Cillizza then describes this word as a ‘rhetorical grenade’. Rubbish, I say. The fact that Trump is still President-at-large is a disgrace. For a start, he’s not an ‘unindicted co-conspirator’ in the SDNY case which saw his fixer plead guilty on two felony counts. I realise this a term of legal art, but it completely misrepresents the situation, in which Trump was the boss and Cohen merely the gofer. And of course the campaign violation stuff is just the tip of the iceberg.

Cillizza then instructs his readers with this gem of wisdom:

Remember that impeachment and indictment are two very different things. The first is a political process, the second is a legal one.

Wow. Is he addressing 10 year-olds or is he one himself? Anyway, he goes on rather long-windedly to point out that impeachment won’t work due to the GOP Senate majority and the two thirds rule. I’d be even more brief. Impeachment is gobshite. Only in America (ok – also in South Korea, Taiwan, Brazil and any other country fool enough to follow the US system).

Cillizza goes on to ‘examine’ the possibility of imprisonment. It’s more of a glossing over, however, than an examination. The Mueller Report itself evaluates ten cases of obstruction of justice, some of which are strong enough to have over 700 federal prosecutors (as of a month ago – the number keeps rising) sign a letter baldly stating that Trump would face ‘multiple felony charges’ on obstruction alone if he was not President. What this says about the totally stuffed federal political system of the USA should indeed be clear to any wide-awake 10 year-old. Then there are the 16 or so criminal probes involving Trump, his foundation, his taxes, his inauguration, his emoluments violations, his anti-immigration horrors (his worst crimes while in office), his links with Russia and the Middle East, the Deutsche Bank money laundering scandals etc etc. It’s abundantly clear that Trump is a pre-teen spoilt brat turned career criminal – because, given his background, he couldn’t succeed at anything else. But a spoilt child, like a spoilt dinner, doesn’t spoil itself. It’s spoilt by its ‘makers’, and I’m not talking about gods. I’m talking about parents and environment and other early influences. So Trump isn’t to blame for becoming the US President, and making the US Presidency the object of global scorn and opprobrium. The fault lies with the US political system itself. The USA allowed this fainéant to become its President (not forgetting Russia’s sly assistance), because it takes pride in allowing anyone to become President. No screening for party allegiance, no screening for legal or political or historical literacy, no screening for business integrity or acumen, no screening for any kind of competence whatsoever. And instead of assuring the world – noting that we’re talking of the world’s most powerful nation, economically and militarily – that with great power comes great responsibility – it teaches us that, in the US at least, with great power comes great immunity.

But let’s get back to Cillizza’s piece. Here are his concluding remarks.

To be clear: Neither impeachment nor arrest is a sure thing. In fact, neither are even long shots. We are deliberating between something that is very, very, very, very unlikely to happen and something that is very, very, very, very, very unlikely to happen. But between impeachment and imprisonment, the former is the far more viable option. No matter what Pelosi wants.

As I’ve made clear, I have no interest in impeachment, but Cillizza is arguing – or, rather, stating, that imprisonment is a virtual impossibility for this career criminal, in spite of all the evidence piling up against him – which will always amount to a mere fraction of his wrong-doing. And yet, my impression is that Cillizza’s as jingoistic about ‘the leader of the free world’ and ‘the light on the hill’ as most Americans. The proverbial frog in the slowly boiling water comes to mind. If Trump escapes imprisonment, then surely that frog is doomed.

References

https://edition.cnn.com/2019/06/06/politics/nancy-pelosi-trump-prison/index.html

https://www.washingtonpost.com/powerpost/pelosi-tells-colleagues-she-wants-to-see-trump-in-prison-not-impeached/2019/06/06/afaf004a-8856-11e9-a491-25df61c78dc4_story.html?utm_term=.4907d39b22c7

https://www.wired.com/story/trumps-world-faces-16-known-criminal-probes/

View at Medium.com

Written by stewart henderson

June 9, 2019 at 3:33 pm

waiting for Mueller – the many and varied problems for Trump

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There are undoubtedly billions of worthier subjects to focus on than Trump, but I do find it hard to look away for long from the slow-moving train wreck – and I’m still nursing my prediction that he’ll be out by year’s end. Of course I keep stumbling at obstacles, and anything that gets in the way of justice being the same for everyone seems to me an unnecessary and illegitimate obstacle. Now it’s this ridiculous notion that you shouldn’t charge a President around election time. It’s bullshit. It should be absolutely clear that you should charge any felon precisely when all is in order to charge him, no matter what time of year it is.

But that apparently isn’t how it goes in the USA, and so we have to wait for two whole months to bring charges, assuming this ‘etiquette’ is followed. And then what happens after the mid-term fall-out? Too close to Christmas?

Needless to say, I’m completely opposed to the truly criminal notion that you can’t charge a head of state while in office. Only in America is such a notion even thinkable – a testament to one of the worst political systems in the western world.

Anyway, no sense bemoaning a system that the US Congress, fourth estate and intelligentsia are too jingoistic to even be capable of examining let alone reforming. So instead I’ll focus here on the legal jeopardy Trump finds himself in from various directions, as we wait for the Mueller team to hopefully finish him off.

Firstly the Michael Cohen case. Cohen is currently out on bail awaiting sentencing on eight criminal counts he has pleaded guilty to. According to this article in The Hill, from August 21, Cohen won’t be sentenced until December 12, which seems an eternity to me. It’s expected that he’ll do a fair amount of jail time.

What has this to do with Trump? Cohen was his fixer and I’m not sure how many of the felonies he’ll be sentenced on relate to Trump or his organisation. Some reports claim that more than one felony relates to the 2016 campaign. What is clear is that Cohen seems bent on revenge for the way Trump, who never treated him particularly well in spite of his loyalty, dropped him like a hot potato shortly after Cohen’s offices and home were raided by the FBI. In pleading guilty to one charge of campaign violations relating to the Stormy Daniels payment, Cohen implicated Trump as the person who directed his activities. This should have led directly to Trump’s arrest, but for some reason this hasn’t happened. In any case it stands to reason that whatever Cohen’s sentence on this particular count, Trump’s should be greater, as the ‘Mr Big’ in this case.

Of course Trump’s legal jeopardy from the Cohen direction is probably, or hopefully, more considerable than just the Stormy matter. Cohen struck a plea deal with the SDNY, clearly in the hope of getting a lighter sentence in return for dirt on Trump, but the plea deal seems to have been minimal, most likely because the Mueller team, who are surely in close contact with SDNY, have enough dirt on Trump already (particularly from the raid on Cohen’s offices and home, conducted by the SDNY, but nothing prevents the FBI from sharing information – in fact such sharing is essential), and they don’t like working with criminals if they can help it. Still, they may call on Cohen if they need to, which all spells trouble for Trump. Meanwhile, Emily Jane Fox writes In Vanity Fair (September 11) that Cohen’s attorney is set to meet New York State tax officials who are looking into the Trump Organisation’s finances. Hopefully Cohen will have more damning stuff on that topic. I should also add that it’s this SDNY probe into Cohen that has granted immunity to the CFO of the Trump Organisation, as well as to David Pecker, chief of the National Enquirer, a gutter mag dedicated to spruiking Trump’s ‘qualities’ and to ‘catching and killing’ negative stories about him. So, more legal jeopardy there.

Secondly, on those New York State tax officials. A Washington Post article from July 20 revealed that the state’s tax agency is investigating Trump’s personal charity (sic), the Trump Foundation. New York’s embattled governor, Andrew Cuomo, who appears to have launched the investigation under pressure from constituents, has said that the probe could lead to criminal charges. Trump’s children would be involved as well as himself.

Thirdly, the tax probe comes on the heels of a civil suit, filed in June by the New York Attorney-General, claiming that Trump and three of his children ran a charity ‘engaged in persistently illegal conduct.’ The Attorney-General’s department has been considering pursuing criminal charges, but apparently there’s a race to become the next Attorney-General there, and the Democratic candidates are all promising to go after Trump if elected. They’re hoping to focus on the Emoluments Clause in the Constitution, which is altogether a good thing. Not being well up on how the US electoral system works, I’m not sure how long it will take for this all to be sorted, but it definitely looks like there will be an annihilation of Republicans in the mid-terms, and this Attorney-General race will be caught up in that. So, more trouble for Trump.

Fourthly, the next Manafort trial starts soon, and it involves Russia. Manafort is apparently trying to negotiate a plea deal as I write, one that won’t involve dumping on Trump, and won’t involve actually going through the trial process. It’s hard to imagine that happening. An article in Fortune, out yesterday (September 13) claims that a deal has more or less been struck, but it’s hard to imagine such a deal not involving Trump. This deal may be announced as early as today. Considering that the Mueller team holds all the cards – a slam-dunk set of convictions on the second trial, and the possibility of retrying the ten counts that were left undecided in the first trial, it’s hard to imagine that Mueller wouldn’t have extracted some damning evidence about Trump, the campaign, and Russian money in exchange for any deal. Maybe Trump won’t be touting Manafort as a ‘great guy’ for much longer – but on the other hand, Manafort may just be lookingfor a way to avoid the expense of a court case he can’t win, and he’s hanging out for a pardon from Trump.

And fifthly, the Mueller probe itself. I see it dividing into three parts – conspiracy, obstruction of justice, and financial crimes.

Conspiracy charges will depend on whether Trump and/or his campaign knew about the Russian interference in the 2016 elections, an interference amply documented in the two speaking indictments, in February and July of this year, which together charged 25 Russian individuals and three Russian companies with hacking of servers and hijacking of social media sites to influence the election outcome, entirely in Trump’s favour. No American citizens were charged, but other persons ‘known and unknown’ to the investigators were repeatedly mentioned. The second indictment also raised profound suspicions that the Trump campaign had knowledge of the hacking, because of certain dates matching comments at the time by Trump himself. Apart from this there is the meeting at Trump Tower on June 9 2016, which I personally think is less significant, but about which there have clearly been cover-ups and lies by the Trump campaign and administration, including by Trump himself. It has always appeared to me highly likely that Mueller has an abundance of material on this conspiracy.

On obstruction, although much of the focus here has been on the firing of James Comey for the illicit reason of trying to stop the Russia investigation, it seems clear to me that the relentless public attacks on the Mueller enquiry, the FBI and the DoJ, and the hounding of  specific officers within those departments, are all very serious cases of obstruction of justice, so flagrant and criminal in intent in fact that they should have warranted dismissal from office long ago. These are questions, of course, about the limits to free speech, but one would think that such limits would indeed apply to the Head of State when speaking of cases in which he himself is implicated. The more power you have to influence, the more responsibility you should bear in speaking of such institutions as investigating services, the judiciary and the free press, a matter which should be inscribed in law. In any case it’ll be interesting to see what the enquiry’s findings are on this topic. They should be fulsome.

On financial misdealings and any other bits and pieces of criminality that might be uncovered during the enquiry, There’s potentially a lifetime of stuff there. It’s pretty certain that Mueller has all the tax returns, and knows a thing or two about Deutsche Bank’s dodgy dealings with Trump. This is the most murky of areas, obviously, but there are outstanding financial experts on Mueller’s team who’ll be having a wonderful time joining all the dots.

So who knows when the fireworks will start, but I’ll be happy to be viewing them from a safe distance. Meanwhile I’ll try, really try, to focus on other things for a couple of months.

 

Written by stewart henderson

September 14, 2018 at 4:58 pm

zero sum game nationalism, Chinese style

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Jacinta: So we’ve been hearing about Russia’s, or Putin’s, obsession with wrecking democratic processes in the USA, Europe and elsewhere – not to mention in Russia itself – but what about Russia’s much more economically smart neighbour, China? We know it’s bent on interference, but for what reason, and to what degree?

Canto: Well this conversation’s based on something we heard this morning, about China having interfered, or tried to, in the last few federal elections, and the consequent problem of foreign donations and investments, and ‘pay for play’ generally.

Jacinta: Yes there’s been a top secret report into foreign interference generally, which is unfortunately ‘classified’, but some of it’s being leaked apparently, and there’s an article about it here. The report names China as the most concerning nation.

Canto: Quelle surprise. And it gets murky fairly quickly, with former NSW Premier and federal Foreign Minister Bob Carr, clearly a Chinese government apologist, trying to undermine John Garnaut, the principal author of the secret report. He recently described Garnaut as one of ”the leaders of the recent anti-China panic in the Australian media”.

Jacinta: Right – why should we panic about the most populous and economically dynamic nation on the planet, a massive human rights abusing dictatorship, interfering with all of our election processes down to the council level, with increasing frequency and sophistication? Surely they’re just doing it for our benefit?

Canto: Garnaut’s ASIO enquiry examined China’s infiltration of Australian political parties, media and academia, and it probed the activities of Huang Xiangmo, a billionaire Chinese businessman who created a ‘think tank’ (always a term to raise the skeptical antennae) called the Australian China Relations Institute (ACRI), headed by Carr. Huang also runs a lobbying organisation for the Chinese Communist Party. Garnaut provided testimony to the US Congress a couple of months ago about China’s considerable activities in interfering with Australian elections. Meanwhile Carr is talking up how friendly to us the Chinese dictatorship is, and questioning Garnaut’s right to advise the government on these matters. He doesn’t seem to have much interest in the facts about interference – which admittedly, we’re all in the dark about, in terms of details. Anyway, ACRI appears to be little more than a lobbying group.

Jacinta: I worry about academic interference, as I work in a field that’s become ever more dependent on full-fee Chinese students. What’s most clear about Chinese students – pace those from Hong Kong – is their general ignorance of and indifference to a political system that allows them no voice and provides them with minimal and distorted info. So I try to open their minds a little, but I get nervous – I’ve heard of spies in the ranks, reporting back to the Beijing bully-boys. And fear of ‘insulting’ the dictatorship, biting the hand that feeds us, will surely be hampering university administrators as well. The worry is that the universities profiting from all this Chinese money will become advocates of a softly softly approach and turning a blind eye to political influence.

Canto: But so far we haven’t addressed the question of what China hopes to gain through interference. Clive Hamilton – no doubt one of Carr’s ‘panic merchants’ –  had much trouble publishing his book Silent Invasion, simply for fear of a Beijing backlash. Two major publishers backed out – were they leaned on? The book raises questions about Carr and Andrew Robb and their dealings with billionaire businessmen..

Jacinta: But look, I do wonder about Silent Invasion‘s subtitle, ‘how China is turning Australia into a puppet state’. Doesn’t that sound a teensy bit panicky?

Canto: Granted, but there are disturbing things happening on Australian soil – which we shouldn’t panic about, but we should act upon. And we should be aware that China is not our friend, as is generally the case with small countries when big countries come sniffing around them. Look at the Philippines way back in the day, when they got some US assistance in their fight for independence from Spain. Once the natives had gained their independence the poor buggers then had to fight off the US, which was only interested in gaining control. Rule of thumb for small countries – don’t trust the overtures of the friendly giants in your neighbourhood, because for the time being, until we grow out of this infantile stage of humanity, nationalism is largely a zero sum game.

Jacinta: There was a small demonstration by a group of Tibetans in Canberra some years ago, at the time of the Beijing Olympics torch relay. They were set upon by Chinese thugs, apparently in what appears to have been an organised attack. Wonder what organisation was behind it. On that occasion, thousands of Chinese students were apparently bussed into Canberra, to celebrate their Chinese-ness. Rumour has it that they were bribed with job offers in China. That probably happens in China itself – fealty to the dictatorship is doubtless a pre-requisite for getting on in business there.

Canto: And the Chinese government recently issued a warning to students due to attacks on them by Australians, though it looks to have been an over-reaction, and probably politically motivated.

Jacinta: I’m sure there have been such racist attacks, we’re just as racist as other countries of course, but the Chinese government would love to have something to criticise us for. Our government’s announcement of tougher espionage laws was met by the usual claims from China of bias and a cold war mentality.

Canto: Those laws were announced precisely as a result of evidence of Chinese interference, and the reasons for the interference are the usual nationalistic ones – to get Australia to allow more Chinese investment, to have a more sympathetic attitude to China’s expansionism in the region, to support China’s domestic assimilation policies and the like. So there are the usual self-interested big nation issues, but there’s also the drive to get Australia, and other nations, to wholly accept its oligarchic and dictatorial closed society with its associated human rights abuses as legitimate, or at least of no concern to other nations.

Jacinta: The Sydney Morning Herald has a maddeningly undated 3-part online article, ‘China’s Operation Australia’, written by a team of top journalists, which highlights ASIO’s concerns about influence peddling and the monitoring of Chinese dissidents inside Australia. Chinese media have been particularly targeted, with some once-independent Chinese news outlets succumbing to the pressure of the Chinese oligarchy. ASIO believes it to be the largest foreign interference campaign ever carried out in Australia.

Canto: Yes and two of the biggest operatives in this campaign are the aforementioned Huang Xiangmo, and Chau Chak Wing. They’re both billionaires, and Chau is an Australian citizen, so changes to the law about political donations from foreigners wouldn’t affect him, though he appears to be in cahoots with the oligarchy. However it appears to be Huang who’s most suspect, though it’s not entirely clear why. He’s a dynamic business type from humble origins who appears to be genuinely philanthropic as well being a hustler for influence. His keenness to become an Australian citizen suggests he’s not entirely wedded to the Chinese political system, while other activities suggest otherwise. And here’s where I start to question, or put into perspective, the ASIO concern. If there’s influence peddling here, it’s not like the rabid Russian, Putin-directed attempts to subvert democracy in the USA and Europe. It’s definitely an attempt to influence policy toward China, and we need to be aware of that. Rules against foreign donations will help, monitoring is always required, and illegal activities should be exposed, but we need to be realistic about the zero sum game that every nation, including Australia, plays, while trying to whittle away at that ultimately self-defeating game in the name of global concerns, including human rights, which are, and always should be, a global issue.

Jacinta: All the same we need to hold our nerve against big bullying countries, and call them out on the international stage if need be.

Written by stewart henderson

June 3, 2018 at 1:13 pm

watching Trump’s downfall – follow the money

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veteran federal prosecutor Andrew Weissmann, bullish criminal fraud expert and key member of the Mueller team

Canto: The good thing about the Mueller investigation, or ‘special counsel enquiry’, is its broad terms of reference, as we Australians would describe it. The brief of the enquiry is to investigate any links and/or co-ordination between the Russian government and individuals associated with the campaign of President Donald Trump, and any matter that arose or may arise directly from the investigation…

Jacinta: So that would include obstructing justice, but I’m not sure that the firing of James Comey, then head of the FBI, in May 2017, will fit the ‘obstruction of justice’ category.

Canto: But the FBI were investigating Russian interference in the 2016 election, and Trump more or less admitted, just after firing Comey, that it was because of the ‘Russia thing’.

Jacinta: ‘More or less’ isn’t good enough, and it could be argued that justice wasn’t obstructed because Comey’s firing led directly to the Mueller investigation.

Canto: Okay forget obstructing justice, at least for now, I was going to talk about money. That’s to say, matters arising directly from the investigation. That’s how Paul Manafort and Rick Gates were indicted. They were lobbying for the pro-Russian faction in Ukraine, in particular the disgustingly villainous Viktor Yanukovych, but were involved, not incidentally, in massive money-laundering schemes. So they’re in big trouble, and it’s well known that Trump and his family are up to their ears in Russian money, and if Trump’s finances aren’t dodgy, then the term dodgy surely has no meaning. Mueller’s team, detailed here, ‘possess a vast array of experience investigating financial fraud, corruption, money laundering, foreign bribery, and organized crime’. A perfect bunch to catch out Trump.

Jacinta: You’re making a few assumptions here about Trump’s corruption. Yes he’s a bullshit artist, he doesn’t have any normal concept of the truth, he’s ignorant, he’s inhumane, he’s a bully and much more. That doesn’t make him a criminal. If he was involved in the kind of activities Manafort was involved in, he surely would’ve been indicted by now.

Canto: They may have enough to indict him, but doing so would bring the investigation to a spectacular halt. His indictment might be the cherry on the cake, the last thing to add. First they’ll be spiralling in on the family, Kushner and Trump Jr…

Jacinta: You’re sounding like the most optimistic anti-Trump pundit, imagining they already have mountains of evidence, they’re just adding to the pile to make this the most spectacular house-of-cards downfall in US history, for which their names (I mean the Mueller team) will be covered in eternal glory. I’m a little sceptical.

Canto: Trump has never produced his tax returns and I’m assuming he has much to hide. His companies declared bankruptcy four times in the early nineties, and two more times in the 2000s. It came to the point where the only bank that would lend to him was Deutsche Bank, a financial institution that was at the same time heavily into laundering Russian money. And it’s no secret that Trump and his family are heavily indebted to Russian oligarchs – super-rich members of Putin’s kleptocracy. Naturally they’re expecting a quid pro quo. This is where the interference lies – Trump’s indebtedness and the Russian government’s expectations.

Jacinta: But has Russia really benefitted, apart from Trump’s fawning over Putin? There was talk of the Trump administration going easy on Russia in exchange for dirt on Clinton, but it hasn’t actually happened has it? Trump’s personal indebtedness to Russians, if proven, doesn’t prove that he or his team conspired with Russians to subvert the US political/democratic system. I mean, there’s no doubt the Russians have been trying to subvert the American, and British and French and other western governments, and they were working toward a Trump victory in 2016 for obvious reasons, but whether or not they conspired directly with the Trump team, that’s unclear. Certainly the Russians would’ve tried to, but did they actually succeed, and what evidence has there been of a quid pro quo?

Canto: We don’t know, but it’s likely that Mueller’s team does. They’ve subpoenaed Deutsche Bank for documents relating to Trump and his family’s finances, though this has been denied by Trump’s lawyer Jay Sekulow. Deutsche Bank is about the only major bank in the world willing to lend to Trump, and it was found guilty of laundering some $10 billion dollars of Russian money last year. Kushner received a loan of $285 million from Deutsche Bank in 2016, just before election day. The Mueller investigators will know much much more about this than we or any reporters do. It’s about connecting the dots, to quote one reporter, between the Trump and Kushner finances, Deutsche Bank and Putin and his billionaire kleptocrats. Apparently Trump and his companies have received no less than $3.5 billion in loans and loan-guarantee agreements from Deutsche Bank since 1998. It’s impossible to believe that Mueller’s lawyers aren’t shining all sorts of lights on all this murkiness and making more sense of it than has ever been made before. I look forward to the next indictment. It might be the most fateful one yet.

Jacinta: Okay, here’s a question. What exactly is money laundering?

Canto: Well, as the term suggests, it’s about turning dirty money into apparently clean stuff. Ill-gotten into ‘legit’. Though the term has become envaguened in recent years,

Jacinta: Good word.

Canto: Thanks, so now it just about covers all kinds of dodgy financial dealings, including terrorist financing. But the key, usually, is to give the appearance of legitimacy to money obtained illegally or wrongfully. And of course the variety of ways this can be done is just about endless. So let me tell you about the Deutsche Bank ‘mirror trade’ system. It was about accepting two trades at once that looked essentially equal and opposite, one in roubles, the other in dollars or other western currencies. These trades looked innocuous but their real purpose was to convert money, and to shift it out of Russia. This, inter alia, helped to ‘clean up’ the money, which was more often than not of dubious origin, given Putin’s kleptocracy.

Jacinta: Just a quick read of Deutsche Bank’s history reveals scandal after scandal, a history of corruption – fraud, price manipulation and so on… which makes me long to get off the topic of money-grubbing and kleptomania and political jiggery-pokery and back to sciencey subjects. I’ve had enough.

Canto: Okay, I’ll try to get my mind off the Trump spectacle – what will happen will happen. No more, I promise – for a while. Just let me end with a list of dictators Trump has lavished praise on. Of course there’s Russia’s Putin and Duterte of the Philippines, but there’s also Nursultan Nazarbayev, dictator of Kazakhstan for the last 25 years; Xi Jinping, long-time leader and now dictator of China, lover of execution and other forms of repression; Abdel-Fattah el-Sissi, Egypt’s new repressive macho-man; Recep Erdogan, the Turkish bag of shit; and he’s expressed approval of Kim Jong Un and even Saddam Hussein. In fact, anybody who doesn’t seize power for himself (no women allowed) and hold onto it for a long time is considered a lightweight…

Jacinta: Okay calm down, let’s look at different sorts of power in the future…

 

Written by stewart henderson

January 4, 2018 at 10:53 am

watching Trump’s downfall – a new civil war?

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Putain and Frump chat about the best Russian hidey-holes cum 2018

Canto: So maybe I’m getting a bit over-excited about the Trump mess. I’m already getting nervous about my prediction that he’ll have fled to exile in Russia by next year.

Jacinta: That was your prediction?

Canto: Well, no I just thought of that one, but he’ll be out of office. The thing is, it’s the Mueller probe that’s most likely to nail him, and I’m being forced to defer to lawyers who predict that Mueller’s team won’t be completed until 2019 or beyond.

Jacinta: Hope deferred makes the heart sick.

Canto: Still, there are other possibilities. His popularity is the lowest of any Prez after a year in office since polling began, by a long way. It’s a slow, steady decline, and if it continues that way it’ll be well down in the twenties by late next year, and that may mirror his fall, slow and steady.

Jacinta: Though hopefully with no soft landing.

Canto: Well if he’s out of power it couldn’t possibly be soft. And I don’t mean weakened by the mid-term elections, I mean out the door.

Jacinta: Well the Republicans have just passed what many are calling a truly terrible tax bill, and people are already taking to the streets. And considering that Trump himself is going to benefit massively from it, while the have-nots and have-littles, many of whom voted for Trump, have been screwed, it may be that this time his base will shrink more than he ever thought it could.

Canto: Yes, there might be fighting in the streets. And here’s where Trump’s over-confident arrogance might just kill him off. He’s made a dangerous promise to campaign heavily towards the mid-terms next year, because he thinks he alone can fix it, that’s to say he can bring his ratings up with the same bullshit that he used last year. The same aggression, the same fake promises, the same conspiracy theories, the same hate speech. But his base, or maybe his ex-base, won’t have seen any improvement in their lives, the circus will have lost a lot of its glitz and the opposition will be mobilised to protest, to drown him out. It could turn ugly, and as fewer people buy into his shite…

Jacinta: The shrinking base will get tougher and angrier, and it’ll be the confederates and the union all over again. Or something.

Canto: Well, war of a kind is brewing, because the rhetoric, especially from the far right, is getting apocalyptic. Mueller and the FBI and the DoJ are in the process of launching a coup, they should be marched out of their lawyerly hidey-holes in cuffs, we have to act now to stop this show trial, that sort of thing.

Jacinta: And some say this is getting orchestrated, or at least egged on, by the White House. Trump junior even got in on the act the other day. He apparently likes to talk about rigged systems and a sinister Deep State…

Canto: The one responsible for September 11?

Jacinta: Yes, and contrails and the fake moon landings and the assassination of JFK and AIDS. The one running the USA and the world from bunkers deep beneath the Rocky Mountains. Anyway the Deep State is now a kind of anti-Trump, similar to the Anti-Christ, out to destroy the Prez.

Canto: Though he’s doing a pretty good job of that himself. And all the adults are saying that Mueller’s a consummate professional and his team won’t be fazed by the baying hounds, but I’m just wondering whether things might get out of control if they don’t produce something positive soon, like an indictment of Kushner, or a summons to Trump himself.

Jacinta: But wouldn’t that just set the Trumpets blaring?

Canto: Not if it was a solid indictment, or a well-worded summons. Of course plenty of Trumpets would blare, and Fox News would howl…

Jacinta: Do foxes howl?

Canto: Yes and they bark and scream and gekker and it’s all pretty hair-raising, but the Trumpets are definitely more dangerous. But anyway I think the drama that would follow the next big Mueller move would be nothing compared to the drama that would follow a move against Mueller, by the White House or a GOP faction.

Jacinta: A number of prominent Dems consider that the holiday break would be an ideal time for Trump to make a move, and they’re issuing warnings. What do you think?

Canto: I think these warnings are tactically sound, though they’re also heartfelt. They really feel this is a fight for democracy. I don’t think Trump would have done anything, but these Democrats speaking up helps to assure that.

Jacinta: Well if Trump does act the civil war may begin with the ‘nobody is above the law‘ rallies. Heard of them?

Canto: Yes a bipartisan organisation that’s set to mobilise protesters around the nation from the moment that Mueller is sacked. So they’ve learned from the past, but the Trumpets should’ve learned too. I don’t think there will be another Saturday night massacre.

Jacinta: No, and I think Trump’s trickier than you might think – he seems to slime his way out of a lot of situations that would see others in prison, and I think he’ll manage somehow to slime his way out of having to swear to anything on oath. But I don’t think he’ll ever manage to slime his way back into popularity again. I would love it if the people got him.

Canto: Like Mussolini?

Jacinta: A pleasant fantasy but let’s be civilised. An uprising so relentless as to make his administration completely unworkable.

Canto: So a night-flight to Russia mightn’t be out of the question then?

Jacinta: Well I can only think of two things that would undo him, a popular uprising or a situation in which he’s forced, personally, to tell the truth.

Canto: But there’s a third. Being forced to reveal his finances.

Jacinta: Well I include that in the second. Being forced to tell the truth about his finances.

Canto: I’m getting impatient, waiting for the DoJ’s next move. I heard they were going to interview Trump’s lawyers, who keep trying to calm him down, like with this idea that he’s about to be exonerated.

Jacinta: Which is silly. I’m pretty sure the investigation will get to Trump, but not until they’ve built up a really solid case. And they won’t be asking him to sit down to a friendly interview, as was reported on somewhat speculatively back in October. Anyway, a few days ago the press were all over this story about the Mueller team interviewing Trump’s lawyers, but I’ve heard nothing since.

Canto: The DoJ won’t be leaking anything about it if it takes place. The White House leaks like the Titanic, but it’s all bullshit.

Jacinta: I think obfuscation’s a better word. Yes you won’t be able to trust anything they say, but Trump’s mood might be revealing.

Canto: Not necessarily. You’re assuming the lawyers will relay to Trump the truth about their meeting. Better to assume the opposite.

Jacinta: What a tangled web they weave. Maybe a public uprising will cut the Gordon knot.

Canto: Most obscurantly put Jacinta. Most obscurantly.

Written by stewart henderson

December 24, 2017 at 8:06 pm

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why Obama’s warnings about dictatorship are more than justified

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Watching one of the cable news networks, either CNN or MSNBC – I’ve become interested in the USA’s parlous political situation as a diversion from my own probs – I listened not so attentively to two opposing views on a recent speech given by Barak Obama in which he warned against complacency with regard to creeping dictatorship. This speech has apparently inflamed Republicans, or members of the alt-right, whatever, I’m not too keen on knowing all the distinctions within that country’s disturbing polity. I got a sample of this ‘indignation’ when a right-wing pundit on the show launched into Obama for his example of Germany in the thirties – all those millions of Jews and Enemies of the State gassed, all that racist ideology and disgusting craziness, how incredibly offensive to make such a comparison, right? Obama really showed himself to be the most shameful opportunist, who’d stoop to anything, and how can you possibly compare this Trump administration with such a maniacal mass-murderer and his henchmen, etc etc.

Then the leftist speaker got to respond and it quickly degenerated into a shoutfest. Of course I felt like shouting too, but then I thought of a more dignified response.

Obama spoke calmly and thoughtfully, and yes certainly he was referring to the Trump administration without naming it. And his comparison with the rise of Hitler might have been controversial but what other choice did he have, seriously? What other dictator would’ve meant anything to most Americans? Obama had a choice of dictatorships subverting democracy. In other words, recent dictatorships. He also would’ve known, consciously or unconsciously, that your average American knows less than zero about the history of any country other than their own. So is he going to talk about Franco’s Spain, or Tito’s Yugoslavia, or Suharto’s Indonesia? Not bloody likely, that would be like talking Swahili to an American audience. Hitler was the obvious, really the only choice. And I have to say, I’ve long been pissed off by the ‘never mention Hitler’ taboo in political discourse. He should be mentioned regularly and often, and then again.

Trump has clear and obvious dictatorial tendencies. He rarely if ever has anything positive to say about democratically elected leaders, but he’s passionately in love with Putin, a petty dictator who’s turned his country into an economic basket case, with a GDP almost exactly the same as Australia’s in spite of a population six or seven times the size. Putin tortures and murders his opponents, or steals their money and sends them into exile, where they live in constant fear for their lives. He has likely destroyed any possibility of democracy in Russia for decades, though I try to still be optimistic about that. I have no doubt that Trump is only curbed by the institutions he lashes out at – the media, the courts, the FBI, the Department of Justice, etc, and would love nothing more than to be monarch of all he surveys, with statues and banners devoted to him everywhere. Then he wouldn’t be reduced to empty threats of suing the many women he’s abused, he could simply eliminate them – a much more permanent, and cheap, solution. He wouldn’t have to humiliate himself by begging support for the Roy Moores of the world, he could simply appoint them, as does his great love Putin.

So the point is that today’s joke can become tomorrow’s reality. Recently, Trump has expressed his ‘disappointment’ about not being able to control the Department of Justice, clearly referring to the Mueller investigation. Privately, we hear, he’s apoplectic with rage about it. We hear also about his ‘administration’ trying to set up an alternative CIA, and his lawyers suggesting he can’t obstruct justice by virtue of his position. You want to laugh, but how many of us were laughing at the very idea of Trump’s candidacy?

All of this, it seems to me, results from a political system in which way too much power is invested in one man (hopefully there will be a female Prez some time soon). In this respect, the USA appears to have far less checks and balances than other western political systems. For example, it appears that the US Prez has veto rights over decisions made by the US congress or senate. This would be unthinkable in any other western nation that I know of. There’s also the apparent fact that the Prez is seen as the representative of justice in the country, which is why past Presidents such as Nixon have seemed confused about their relationship to the law – whether they’re above, below or adjacent to it. It’s a farcical but disturbing situation which just doesn’t occur in other western democracies, in which roles and power are more diversified and the leader is very much first among equals. The fact that legal experts are actually debating whether the American President can be accused of obstructing justice is a perfect example of the craziness at the summit of US politics. If the Prime Minister of Australia, or Great Britain, or the Chancellor of Germany tried to argue that they were above the law, they wouldn’t be just thrown out of office, they’d be laughed out of office. They say that power corrupts and absolute power corrupts absolutely; the US President’s power isn’t absolute, but it’s certainly too far on that side of the spectrum.

So Trump is currently pushing an envelope that’s already too large – the envelope of Presidential power. But there are positive signs. Certainly there’s no chance of him being re-elected, with his popularity waning and no real chance of it rising again, with a profoundly serious criminal investigation moving inexorably closer to Trump and his family, and with local elections moving against the Republicans. The tragedy is – and this is yet another problem for the US political system – that when Trump is pushed out of office, which I predict will happen next year, his administration won’t be dumped at the same time, as would happen in just every other democratic country, with fresh elections held. Instead you’d have an entirely discredited administration, led by the super-imbecilic bible-basher Mike Pence or the generally supine Paul Ryan, limping along for another two or three desolate years.

I may have made some mistakes about how the political system works in the USA, as I don’t like to get too close to it (I don’t find the odour appealing), but I do find it tiresome if not laughable when I hear American pundits talking about theirs as the greatest democracy, or their country as the cradle of democracy, etc. I am finding it entertaining at the moment though, with due deference to the poor and the struggling who are truly being done over by their absurd President and his horrendous policies.

 

Written by stewart henderson

December 10, 2017 at 11:09 am