Spitfire List Web site and blog of anti-fascist researcher and radio personality Dave Emory.

For The Record  

FTR #759 The Adventures of Eddie the Friendly Spook, Part 6: More About the Deep Fifth Column

Robert McCormick: Fifth Colum­nist of the fourth estate

Dave Emory’s entire life­time of work is avail­able on a flash dri­ve that can be obtained here. (The flash dri­ve includes the anti-fas­cist books avail­able on this site.)

Lis­ten: MP3

Side 1  Side 2  

Intro­duc­tion: This pro­gram con­tin­ues analy­sis of Eddie Snow­den’s “op” and the GOP gov­ern­ment shut­down and fis­cal ter­ror­ism as part of the same phe­nom­e­non. Begin­ning with analy­sis of fifth colum­nists’ media leaks pri­or to, and dur­ing, World War II, the broad­cast posits that both those leaks and Eddie the Friend­ly Spook’s gam­bit are of sim­i­lar intent and design. Where­as leaks of crit­i­cal Amer­i­can World War II plans and oper­a­tional intel­li­gence were designed to aid the Axis, Eddie the Friend­ly Spook’s actions are designed to injure the Unit­ed States, to the ben­e­fit of the Under­ground Reich.

High­light­ing indi­vid­u­als asso­ci­at­ed with Amer­i­ca First, the dis­cus­sion under­scores their links and inter­ac­tion with the Third Reich and its lead­ers, includ­ing Hitler.

Review­ing dis­cus­sion from FTR #758, the pro­gram under­scores ide­o­log­i­cal con­ti­nu­ity between the views expressed by Hitler in his speech before the Indus­try Club of Dus­sel­dorf, the anti-demo­c­ra­t­ic sen­ti­ment of the Lud­wig von Mis­es Insti­tute, the anti-demo­c­ra­t­ic views of Peter Thiel (chief bankroller of Ron Paul’s 2012 Pres­i­den­tial cam­paign and the largest investor in, and chair­man of the board of, Palan­tir) and the pro-monar­chist, anti-demo­c­ra­t­ic views of von Mis­es dis­ci­ple Hans Her­mann-Hoppe.

It should not come as a sur­prise that Hoppe has net­worked with Amer­i­can Renais­sance, one of the many white suprema­cist groups with which Ron Paul asso­ciates. (Dis­cussing Ron Paul net­work­ing with white suprema­cists is sim­i­lar to say­ing “Adolf Hitler net­works with Nazis.”

Most of the sec­ond side of the pro­gram under­scores ele­ments of com­mon­al­i­ty between the insti­tu­tions and indi­vid­u­als sup­port­ing Edward Snow­den and the GOP ele­ments that shut down the fed­er­al gov­ern­ment and threat­ened the U.S. and the world with eco­nom­ic chaos.

In addi­tion to what we call the “Paulis­tin­ian Lib­er­tar­i­an Orga­ni­za­tion” (Ron Paul and his son sen­a­tor Rand Paul), Rep­re­sen­ta­tive Justin Amash (R–Grand Rapids, Michi­gan) was one of the prin­ci­pal GOP archi­tects of the shut­down. Amash spon­sored anti-NSA leg­is­la­tion and, not sur­pris­ing­ly, is a schmooz­ing bud­dy of Glenn Green­wald, Snow­den’s leak­ing jour­nal­ist of choice.

In addi­tion to financ­ing most of Ron Paul’s Super PAC, Peter Thiel chan­neled funds to Ted Cruz as well.

The pro­gram con­cludes with dis­cus­sion of the effect on world opin­ion and the U.S. econ­o­my of the gov­ern­men­tal shut­down effect­ed by the “Paulis­tin­ian” milieu of which Snow­den is part and par­cel. It is Mr. Emory’s con­tention that Snow­den’s “dis­clo­sures” are part of what might be con­ceived of as an anti-Amer­i­can, anti-Oba­ma, pro-Under­ground Reich pin­cers move­ment. The var­i­ous tar­gets of and goals of the oper­a­tion will be laid out in future pro­grams.

Pro­gram High­lights Include: Hitler’s view that democ­ra­cy auto­mat­i­cal­ly leads to com­mu­nism; Hitler’s opin­ion that the pol­i­tics of per­son­al­i­ty and achieve­ment trumped a need for democ­ra­cy, which he viewed as a mob-beast; Hoppe’s view of democ­ra­cy as “mob rule;” Hoppe’s eugeni­cist con­tempt for uni­ver­sal health care, some­thing which clear­ly res­onates with the GOP fanat­ics hold­ing the U.S. gov­ern­ment hostage; Peter Thiel’s view that small, idio­syn­crat­ic, loose­ly-con­fed­er­at­ed gov­ern­ing bod­ies are the opti­mum form of social organization–a view sim­i­lar to those of Hoppe; Excerpts from Ron Paul’s newslet­ters endors­ing Amer­i­can Renais­sance.

1. The first side of the pro­gram con­sists pri­mar­i­ly of a read­ing of a post com­par­ing the activ­i­ties of Snow­den et al with the activ­i­ties of the Amer­i­ca Firsters and the Axis Fifth Col­umn in the Unit­ed States pri­or to, and dur­ing, World War II:

COMMENT: A term that is essen­tial for users of this web­site to com­pre­hend is “fifth col­umn.”  The advance and suc­cess of fas­cism pri­or to, and dur­ing, World War II would not have been pos­si­ble with­out the aid of the fifth columns.

It is for that rea­son that books about fifth col­umn fas­cist move­ments and activ­i­ty are includ­ed in the “Books” cat­e­go­ry.

Vital­ly impor­tant, though long for­got­ten, books like Under Cov­er and Cairo to Dam­as­cus by John Roy Carl­son, Falange–The Secret Axis Army in the Amer­i­c­as by Alan Chase,  Armies of Spies by Joseph Golomb, The Nazis Go Under­ground by Curt Riess, and Tri­umph of Trea­son by Pier Cot shed light on the pro­found pres­ence of Nazis, fas­cists and their sym­pa­thiz­ers with­in coun­tries tar­get­ed for fas­cist con­quest.

As back­ground to this dis­cus­sion, we might coin the term “deep fifth column”–powerful and dom­i­nant forces that saw fascism–“corporatism” as Mus­soli­ni termed it–as a won­der­ful solu­tion to what they saw as “problems”–democracy and trade unions among them.

(Par­en­thet­i­cal­ly, we note that ours is a failed civilization–one that has failed to take into account the great eco­nom­ic, polit­i­cal and intel­lec­tu­al pow­er behind fas­cism. World War II is seen by our cul­ture as an unfor­tu­nate event, caused by a “bunch of weirdos, who got out of hand.” It is for this rea­son that we include books about the alto­geth­er dead­ly (and sad­ly eclipsed) forces that caused the blood­let­ting in the Sec­ond World War, much of the glob­al car­nage that has ensued since, and the anni­hi­lat­ing future that awaits our civ­i­liza­tion, if polit­i­cal iner­tia pre­vails.

We also note that much of the suc­cess of The Under­ground Reich has been Ger­many’s mas­ter­ful strate­gic use of anti-com­mu­nism and class war­fare as a gam­bit to infil­trate and co-opt the pow­er elites of coun­tries tar­get­ed for sub­ver­sion. Where­as anti-com­mu­nism and class strug­gle are seen by Amer­i­can and oth­er elites as ends in them­selves, to real­ize “cor­po­ratism”–Ger­many has used those as vehi­cles for con­quest.)

We also note in this con­text that the fifth columns were nev­er addressed in many coun­tries. Just as Ger­many was nev­er real­ly de-Naz­i­fied, the fifth columns were nev­er root­ed out in many of the oth­er West­ern coun­tries, includ­ing the Unit­ed States, Unit­ed King­dom and France. The fifth columns–the deep fifth columns in particular–were crit­i­cal to the enabling and for­ma­tion of The Under­ground Reich.

Lis­ten­ers and users of this web­site should make it a point to down­load, print and read the books deal­ing with the “deep fifth col­umn.”

In our recent, volu­mi­nous analy­sis of “Snow­den’s Ride”–the Nazi psy-op so suc­cess­ful­ly per­pe­trat­ed by Eddie The Friend­ly Spook and the forces who have man­aged his escapade–we are look­ing at the activ­i­ties of an Under­ground Reich milieu/intelligence net­work. Our series on this is long, com­plex and mul­ti-lay­ered: Part IPart IIPart IIIPart IVPart VPart VIPart VIIPart VIIIPart IXPart X, Part XI, Part XIIPart XIIIPart XIVPart XVPart XVI, Part XVII.

It is less clear pre­cise­ly who is the imme­di­ate intel­li­gence con­troller of Eddie the Friend­ly Spook, although BND is almost cer­tain­ly involved and may be the ulti­mate exec­u­tive author­i­ty. The prob­a­bil­i­ty is very strong that a “deep fifth col­umn” with­in U.S. intel­li­gence, mil­i­tary, cor­po­rate and polit­i­cal struc­ture is involved.

A recent (and pre­dictably slant­ed) Wall Street Jour­nal arti­cle dealt with a leak of Naval Intel­li­gence secrets dur­ing the course of World War II.

Dis­clos­ing the piv­otal fact that U.S. intel­li­gence had cracked the Japan­ese “White Code” (not spec­i­fied in the WSJ arti­cle), “Colonel” Robert R. McCormick­’s Chica­go Tri­bune leaked vital infor­ma­tion for the sec­ond time in less than a year.

Hav­ing pre­vi­ous­ly leaked the Rain­bow Five con­tin­gency plan for U.S. mobi­liza­tion and war-mak­ing doc­u­ments for the Sec­ond World War, McCormick was a mem­ber of Amer­i­ca First. Osten­si­bly iso­la­tion­ist and “patri­ot­ic” in out­look, the orga­ni­za­tion was, in fact, active­ly fund­ed by Third Reich intel­li­gence and com­prised (for the most part) of doc­tri­naire fas­cists who loved Hitler and Mus­soli­ni and hat­ed Franklin Delano Roo­sevelt with a pas­sion.

(For a good under­stand­ing of the active pro-fas­cist nature of Amer­i­ca First, open Under Cov­er by John Roy Carl­son and use the “find” func­tion on your com­put­er, search­ing “Amer­i­ca First.” This will yield a good under­stand­ing of the nature of that orga­ni­za­tion and its mem­bers.)

As dis­cussed in AFA #11, the prob­a­ble source of the leak of the Rain­bow Five pro­gram was Gen­er­al Albert Wede­mey­er, one of its pri­ma­ry authors and an active Amer­i­ca Firster. (See text excerpts below for infor­ma­tion about Wede­mey­er and the leak of Rain­bow Five.)

A lynch­pin of the Chi­na Lob­by, the MacArthur group in the mil­i­tary and the milieu that coa­lesced into the  John Birch Soci­ety, Wede­mey­er stud­ied at the Ger­man mil­i­tary acad­e­my, begin­ning in 1936, rent­ing his apart­ment from Ger­hard Ross­bach, one of the lead­ers of the Brown­shirts (SA.) Lat­er (as dic­sussed in AFA #11) Ross­bach went to work for the CIA in the post­war peri­od.

Yet anoth­er point about Wede­mey­er set forth in AFA #11 is the fact that Ronald Rea­gan appoint­ed Wede­mey­er as a spe­cial mil­i­tary advis­er.

In a book excerpt below, Wede­mey­er blames the leak of Rain­bow Five on–of course–Franklin Delano Roo­sevelt, claim­ing that it was part of Roo­sevelt’s plan to get the Unit­ed States into World War II. Roo­sevelt was con­ve­nient­ly dead by the time Wede­mey­er held forth. (This is a major claim of the deep fifth col­umn through the decades, since picked up and ampli­fied by the con­spir­a­cy crowd.)

In his pre­dictably self-serv­ing analy­sis, Wede­mey­er does reveal some­thing inter­est­ing about the net­work­ing in which McCormick engaged. Wede­mey­er main­tains that McCormick sent the Rain­bow Five infor­ma­tion direct­ly to Hitler!

Again, dis­cus­sion of Snow­den’s Ride, per se, is beyond the scope of this post. It is, quite clear­ly, a fascist/Underground Reich oper­a­tion, with the ulti­mate exec­u­tive author­i­ty being the BND, in all prob­a­bil­i­ty.

It may be that an Under­ground Reich fifth col­umn with­in U.S. intel­li­gence is involved, ulti­mate­ly answer­ing to BND.

One impor­tant pos­si­bil­i­ty entails Peter Thiel, whose Palan­tir com­pa­ny appears to be the devel­op­er of the PRISM soft­ware. Thiel embod­ies the con­cept of the deep fifth col­umn. Ger­man born, son of a chem­i­cal engi­neer from Frank­furt (read “I.G. Far­ben”), Thiel has open­ly negat­ed the con­cept of democ­ra­cy, hates Oba­ma and is the chief finan­cial backer of cryp­to-Nazi Ron Paul, to whose cam­paign Eddie the Friend­ly Spook con­tributed. The “Paulis­tini­ans” are to be found at many lev­els of this con­cate­na­tion.

In addi­tion, Alex Karp, the CEO of Palan­tir and some­one who appears to have been cen­tral­ly involved in the devel­op­ment of Thiel’s career also has roots in Frank­furt Ger­many! (See text excerpts below.)

NOTE: Palan­tir offi­cial­ly claims that “their PRISM” is NOT the same PRISM in the focal point of the Snowden/NSA imbroglio. We feel this claim is laugh­able, frankly. The notion that the intel­li­gence ser­vices are using TWO counter-ter­ror soft­ware pro­grams with iden­ti­cal names is not cred­i­ble. Had a com­pa­ny devel­oped a counter-ter­ror soft­ware pro­gram for use by the intel­li­gence com­mu­ni­ty and called it “PRISM,” there would have been lit­i­ga­tion. The major tech com­pa­nies are NOTHING if not liti­gious, and Thiel and com­pa­ny have PLENTY of mon­ey!

That Oba­ma is deal­ing with a deep fifth col­umn in these leaks is a pos­si­bil­i­ty to be seri­ous­ly con­sid­ered.

“Echoes From a Past Leak Probe” by Jess Bravin; Wall Street Jour­nal; 8/7/2013.

New­ly released doc­u­ments pro­vide a road map of how the gov­ern­ment tried to mount a no-holds-barred legal attack against jour­nal­ists sus­pect­ed of leak­ing mil­i­tary secrets.

But the mem­os weren’t about the cur­rent-day Bradley Man­ning case. They came after a dis­clo­sure 71 years ago about World War II’s Bat­tle of Mid­way and show the U.S. has long wres­tled with how to square nation­al secu­ri­ty and press free­dom.

The Jus­tice Depart­men­t’s Office of Legal Coun­sel, which advis­es the exec­u­tive branch on the extent of its own pow­ers, pub­lished in late July a selec­tion of pre­vi­ous­ly secret legal opin­ions span­ning from 1933 to 1977. Among them were mem­os about a June 7, 1942, scoop in the Chica­go Tri­bune by cor­re­spon­dent Stan­ley John­ston, who saw a naval intel­li­gence file while trav­el­ing with the Pacif­ic Fleet.

Pen­ta­gon offi­cials were stunned by the head­line, “U.S. Navy Knew in Advance All About Jap Fleet,” when they saw the sto­ry, which also ran in the Wash­ing­ton Times-Her­ald. The arti­cle all but revealed one of the war’s great­est secrets: that the U.S. had cracked the Japan­ese navy’s code. It report­ed that Japan­ese fleet strength “was well known in Amer­i­can naval cir­cles,” that the U.S. Navy knew the Japan­ese were like­ly to stage a feint against the Aleut­ian Islands, and that “the advance infor­ma­tion enabled the Amer­i­can Navy to make full use of air attacks on the approach­ing Japan­ese ships.”
Navy Sec­re­tary Frank Knox wrote to Attor­ney Gen­er­al Fran­cis Bid­dle, demand­ing indict­ments. The head­line alone “dis­clos­es secret and con­fi­den­tial infor­ma­tion to the detri­ment of our nation­al defense,” Mr. Knox wrote. Mr. Bid­dle then asked staff for advice, result­ing in the just-released mem­os. . . .

. . . . The mem­os are notice­ably silent on one pos­si­bly per­ti­nent point: Tri­bune’s pub­lish­er, Col. Robert R. McCormick, was an incen­di­ary antag­o­nist of the New Deal and, before Pearl Har­bor at least, a vocif­er­ous oppo­nent of inter­ven­tion in World War II. . . .

“The Big Leak” by Thomas Flem­ing; Amer­i­can Her­itage Mag­a­zine; Decem­ber 1987.

 . . . .Gen­er­al Wede­mey­er, still erect and men­tal­ly alert, recalled the atmos­phere he encoun­tered when he walked into the Muni­tions Build­ing at 7:30 A.M. on Decem­ber 5. “Offi­cers were stand­ing in clumps, talk­ing in low tones. Silence fell, and they dis­persed the moment they saw me. My sec­re­tary, her eyes red from weep­ing, hand­ed me a copy of the Times Her­ald with Manly’s sto­ry on the front page. I could not have been more appalled and astound­ed if a bomb had been dropped on Wash­ing­ton.”

For the next sev­er­al days Wede­mey­er almost wished a bomb had been dropped and had land­ed on him. He was the chief sus­pect in the leak of Rain­bow Five, which with­in the closed doors of the War Depart­ment was called the Vic­to­ry Pro­gram. He had strong ties to Amer­i­ca First, the lead­ing anti­war group in the nation. Both he and his father-in-law, Lt. Gen. Stan­ley D. Embick, were known to be oppo­nents of Roosevelt’s for­eign pol­i­cy, which they thought was lead­ing the Unit­ed States into a pre­ma­ture and dan­ger­ous war. . . .

. . . . Lat­er in this tumul­tuous morn­ing two FBI agents appeared in Wedemeyer’s office and exam­ined the con­tents of his safe. Their eyes widened when they dis­cov­ered a copy of the Vic­to­ry Pro­gram with every­thing that had appeared in the news­pa­pers under­lined. The sweat­ing Wede­mey­er explained that he had just done the under­lin­ing to get a clear idea of how much had been revealed. The two agents began an inter­ro­ga­tion of Wede­mey­er and oth­er Army and Navy offi­cers that con­tin­ued for months.

Sev­er­al Army staff offi­cers said they strong­ly sus­pect­ed Wede­mey­er of being the leak­er. An anony­mous let­ter, obvi­ous­ly writ­ten by an insid­er and addressed to the Sec­re­tary of War, accused him and Gen­er­al Embick. Wedemeyer’s prospects grew even bleak­er when the FBI dis­cov­ered he had recent­ly deposit­ed sev­er­al thou­sand dol­lars in the Rig­gs Nation­al Bank in Wash­ing­ton. He explained it was an inher­i­tance and went on man­ful­ly to admit to the FBI that he knew Gen. Robert E. Wood, Charles A. Lind­bergh, and oth­er lead­ers of Amer­i­ca First and agreed with some of their views. He often attend­ed Amer­i­ca First meet­ings, although nev­er in uni­form. . . .

. . . . On Decem­ber 7, 1941, the ques­tion of Rain­bow Five’s impact on Amer­i­can pol­i­tics became moot. Japan­ese planes swooped out of the dawn sky to dev­as­tate the Amer­i­can fleet at Pearl Har­bor. The Vic­to­ry Pro­gram had envis­aged devot­ing almost all of America’s mil­i­tary strength to defeat­ing Hitler. Japan, in that sce­nario, was to be han­dled by defen­sive strate­gies short of war. . . .

In and Out of Hol­ly­wood: A Biog­ra­pher’s Mem­oir by Charles High­am; p. 212.

. . . . [Bur­ton Wheel­er], see­ing the plan as a breach of neu­tral­i­ty and proof of Roo­sevelt’s ille­gal and supra­con­sti­tu­tion­al behav­ior, in turn took the plan to anoth­er iso­la­tion­ist, Robert R. McCormick, own­er and pub­lish­er of the Chica­go Tri­bune, who at once pub­lished it on the front page.

Simul­ta­ne­ous­ly, McCormick sent the plan to Hitler by West­ern Union. Hitler met with Joachim von Ribben­trop, his for­eign min­is­ter, and asked him if the exis­tence of the plan called for imme­di­ate action. . . .

2. The sec­ond side of the pro­gram opens with review of the sim­i­lar­i­ty between Lud­wig von Mis­es dis­ci­ple and Juer­gen Haber­mas stu­dent Hans Her­mann-Hoppe’s indict­ment of uni­ver­sal health care and the GOP/Tea Par­ty offen­sive against the Afford­able Care Act. For more detailed dis­cus­sion of this, see the descrip­tion for FTR #758.

3. Hoppe has net­worked with Amer­i­can Renais­sance, one of the many white suprema­cist groups allied with Ron Paul, Eddie Snow­den’s Pres­i­den­tial can­di­date of choice.

“Lib­er­tar­i­ans and Race Real­ism” by Gilbert Cavanaugh; Amer­i­can Renais­sance; 10/11/2013.

For those of us who enjoy a touch of lib­er­tar­i­an­ism, the news of Jared Taylor’s recent appear­ance at Hans-Her­mann Hoppe’s Prop­er­ty and Free­dom Soci­ety was well received. . . .

4. The pro­gram under­scores the nature of the Amer­i­can Renais­sance, not­ing the type of indi­vid­u­als cham­pi­oned by, and net­worked with, the orga­ni­za­tion.

“Pro­file: Amer­i­can Renais­sance;” His­to­ry Com­mons.

Sam Fran­cis. [Source: Amer­i­can Renais­sance]Sam Fran­cis, a senior colum­nist and writer for the con­ser­v­a­tive Wash­ing­ton Times, is fired after sug­gest­ing that white Amer­i­cans must reassert what he believes is their innate dom­i­nance over oth­er races. At the 1995 Amer­i­can Renais­sance con­fer­ence, host­ed by the white suprema­cist orga­ni­za­tion of the same name, Fran­cis tells his audi­ence: “[Whites] must reassert our iden­ti­ty and our sol­i­dar­i­ty, and we must do so in explic­it­ly racial terms through the artic­u­la­tion of a racial con­scious­ness as whites. The civ­i­liza­tion that we as whites cre­at­ed in Europe and Amer­i­ca could not have devel­oped apart from the genet­ic endow­ments of the cre­at­ing peo­ple, nor is there any rea­son to believe that civ­i­liza­tion can be suc­cess­ful­ly trans­mit­ted to a dif­fer­ent peo­ple.” . . .

5. In addi­tion to infor­ma­tion pre­sent­ed in FTR #756 about the Amer­i­can Renaissance/Ron Paul link, the show sup­ple­ments the dis­cus­sion with mate­r­i­al from Ron Paul’s newslet­ters.

“More Selec­tions from Ron Paul’s Newslet­ters” by TNR Staff; The New Repub­lic; 1/14/2008.

. . . . In an arti­cle enti­tled “The Com­ing Race War,” The Ron Paul Polit­i­cal Report refers to the “pro-com­mu­nist phi­lan­der­er Mar­tin Luther King” and refers to his “non-vio­lent approach” as “(i.e., state vio­lence).” The newslet­ter advis­es that, “if there is any issue the Repub­li­cans have in their favor for the next pres­i­den­tial elec­tion, it is the ques­tion of race. It was all over for Michael Dukakis when Jesse Jack­son gave his awful prime-time speech at the last Demo­c­ra­t­ic
con­ven­tion, and the cam­eras focused on mass­es of teary-eyed, left-wing blacks.”

A May 1990 issue of the Ron Paul Polit­i­cal Report cites Jared Tay­lor, who six months lat­er would go onto found the eugeni­cist and white suprema­cist peri­od­i­cal Amer­i­can Renais­sance.

The May 1991 issue of the Ron Paul Polit­i­cal Report cites Amer­i­can Renais­sance and offers read­ers sub­scrip­tion infor­ma­tion for it.

The July 1994 Ron Paul Sur­vival Report cites “crim­i­nol­o­gist” Jared Tay­lor. . . .

6. High­light­ing ele­ments of com­mon­al­i­ty between the forces behind Eddie Snow­den and those behind the gov­ern­ment shut­down and threat­ened eco­nom­ic chaos, the pro­gram high­lights Justin Amash, Repub­lic of Grand Rapids, Michi­gan. Amash co-spon­sored anti-NSA leg­is­la­tion.

“Momen­tum Builds Against N.S.A. Sur­veil­lance” by Jonathan Weis­man; The New York Times; 7/28/2013.

The move­ment to crack down on gov­ern­ment sur­veil­lance start­ed with an odd cou­ple from Michi­gan, Rep­re­sen­ta­tives Justin Amash, a young lib­er­tar­i­an Repub­li­can known even to his friends as “chief wing nut,” and John Cony­ers Jr., an elder of the lib­er­al left in his 25th House term. . . .

7. Not sur­pris­ing­ly, Amash and Cit­i­zen Green­wald are on excel­lent terms.

“The Repub­li­cans Who Caused the Gov­ern­ment Shut­down” by Charles John­son; Lit­tle Green Foot­balls; 10/16/2013.

The Atlantic has a help­ful run­down of 32 Repub­li­cans Who Caused the Gov­ern­ment Shut­down. First on the list:

Rep­re­sen­ta­tive: Justin Amash

Home Dis­trict: Grand Rapids, Michi­gan

Quot­ed: “Pres­i­dent Oba­ma and Sen­a­tor Reid refuse to nego­ti­ate over giv­ing reg­u­lar Amer­i­cans the same breaks they give them­selves, gov­ern­ment work­ers, and big busi­ness.”

And lest we for­get, Rep. Justin Amash was strong­ly endorsed by none oth­er than pseu­do-lib­er­al activist Glenn Green­wald, who called Amash a “GOP dis­si­dent.” Right. . . .

8. Sen­a­tor Ted Cruz of Texas was in the cen­ter ring of the GOP “shut­down cir­cus.” Cruz has drawn much finan­cial sup­port from the afore­men­tioned Peter Thiel.

“Reminder: Peter Thiel Is Ted Cruz’s Gay Bil­lion­aire Ally” by Sam Bid­dle; Val­ley Wag; 9/2/2013.

Where does a man like Ted Cruz get the con­fi­dence to IRL troll the Unit­ed States Sen­ate for 21 hours? Know­ing that Pay­Pal bil­lion­aire and Sil­i­con Val­ley king­pin Peter Thiel has his back sure­ly helps. . . .

9. The con­clu­sion of the broad­cast focus­es on the dam­age done by the GOP “shut­down” milieu, inex­tri­ca­bly linked with Eddie Snow­den’s polit­i­cal envi­ron­ment. A for­mer vice chair­man of the Fed­er­al Reserve not­ed some of the dam­age that has been done to the U.S. econ­o­my by the shut­down and what would be done if the debt ceil­ing had not been raised. The “shutdown”/Snowden milieu had threat­ened to do just that.

“The GOP’s Flir­ta­tion with Dis­as­ter” by Alan S. Blind­er; The Wall Street Jour­nal; 10/11/2013.

 . . .What dam­age has Amer­i­ca endured already from the par­tial gov­ern­ment shut­down? Sev­er­al pri­vate firms esti­mate that each week of shut­down trims the GDP growth rate for the fourth quar­ter of 2013 by some­thing around 0.15 to 0.2 of a per­cent­age point—with vir­tu­al­ly all of that made up in the first quar­ter of 2014. If you don’t care about mess­ing up the lives of about 800,000 gov­ern­ment employ­ees, plus tens of mil­lions of Amer­i­cans who depend on their ser­vices, that may not seem like much. But there is also a less tan­gi­ble, though per­haps more durable, cost of mak­ing the Unit­ed States of Amer­i­ca look clown­ish in the eyes of the world.

Fail­ing to raise the nation­al debt lim­it on time would be vast­ly more cost­ly. Start with the most obvi­ous, tan­gi­ble, and eas­i­ly mea­sur­able cost: the near-term dam­age to Amer­i­ca’s econ­o­my. The fed­er­al bud­get deficit is now run­ning around $750 bil­lion a year, rough­ly 4.5% of GDP. If the Trea­sury los­es the abil­i­ty to bor­row more, the bud­get must be bal­anced imme­di­ate­ly, mean­ing that fed­er­al spend­ing must fall imme­di­ate­ly by about $750 bil­lion (at annu­al rates), or about 20%. Both the amount and the sud­den­ness are stun­ning. Cut­ting fed­er­al spend­ing that much would like­ly reduce GDP by more than 4.5%—in an econ­o­my that is bare­ly man­ag­ing 2% growth rates. That spells reces­sion.

Most of the neg­a­tive impact on GDP would cease once the impasse end­ed, though strong down­ward momen­tum is hard to arrest. Oth­er costs, how­ev­er, would last for years, if not decades. Once inter­na­tion­al investors come to see threats to default as a stan­dard weapon of Amer­i­can polit­i­cal combat—something they may now be start­ing to believe—U.S. Trea­sury debt would cease being the world’s safest asset. And that would have two seri­ous impli­ca­tions.

First, the Trea­sury would have to pay some­what high­er inter­est rates on all future bor­row­ing, per­haps for decades, maybe for­ev­er. By the way, that might hap­pen even if we meet all our inter­est and prin­ci­pal pay­ments and default—yes, that is the right word—on some oth­er oblig­a­tions.

Sec­ond, the glob­al finan­cial sys­tem would begin a fran­tic search for a new inter­na­tion­al cur­ren­cy. U.S. Trea­surys have long served that pur­pose. But if inter­na­tion­al investors see Trea­surys as poten­tial polit­i­cal pawns, they will seek some­thing safer. Since there is no obvi­ous replace­ment, a world-wide finan­cial pan­ic along 2008 lines is pos­si­ble.

And did I men­tion that Wash­ing­ton would look like a bunch of knaves and fools? It is hard for a nation that has tak­en leave of its sens­es to remain the undis­put­ed leader of the Free World. Hope­ful­ly, Mr. Boehn­er’s offer will take this dooms­day sce­nario off the table. How­ev­er, the lev­el of par­ti­san acri­mo­ny has ratch­eted up sev­er­al notch­es in the past month. Fur­ther­more, the tea-par­ty fac­tion has intim­i­dat­ed Mr. Boehn­er before, and might do so again. And since the par­tial gov­ern­ment shut­down has­n’t end­ed civ­i­liza­tion as we know it, some Repub­li­cans may now see the risk of a debt calami­ty as accept­able. A few are already talk­ing that way. . . .

10. The threat of fail­ure to raise the debt ceil­ing shook glob­al con­fi­dence in the Unit­ed States and the dol­lar’s sta­tus as a reserve cur­ren­cy.

“Imag­in­ing the Dol­lar With­out Its Priv­i­lege” by Eduar­do Porter; The New York Times; 10/16/2013.

“The effec­tive­ness, sta­bil­i­ty, and pre­dictabil­i­ty of Amer­i­can pol­i­cy mak­ing and polit­i­cal insti­tu­tions have weak­ened at a time of ongo­ing fis­cal and eco­nom­ic chal­lenges,” it said. Investors around the world rushed to find a safe place to put their mon­ey.

Rather than dump America’s down­grad­ed bonds, how­ev­er, investors flocked to them. The dol­lar strength­ened. The Unit­ed States might have become a threat to the world econ­o­my, but with even worse trou­bles devel­op­ing else­where, includ­ing a flare-up in the euro cri­sis, it was still its safest place.

As George Soros, the hedge fund investor, told me in an inter­view last Fri­day, “The dol­lar is the weak­est cur­ren­cy except for all the oth­ers.”

The dollar’s resilience comes to mind as Con­gress again flirts with finan­cial dis­as­ter.

As time ticked down to a pos­si­ble gov­ern­ment default as ear­ly as Thurs­day, Repub­li­cans in the House failed once again on Tues­day to agree on a pro­pos­al to relieve the impasse, reopen the gov­ern­ment and lift the debt ceil­ing.

“How can the Unit­ed States pre­serve its finan­cial and secu­ri­ty lead­er­ship role when it con­ducts itself with such inep­ti­tude and such dis­re­gard for the con­se­quences for the world?” asked Charles Dal­lara, a senior Trea­sury offi­cial for the for­mer pres­i­dents Ronald Rea­gan and George H. W. Bush who until ear­li­er this year head­ed the Insti­tute of Inter­na­tion­al Finance, a lob­by group of inter­na­tion­al banks.

Host­ing finance min­is­ters from around the world last week at the Inter­na­tion­al Mon­e­tary Fund’s fall meet­ing in Wash­ing­ton, Chris­tine Lagarde, the fund’s man­ag­ing direc­tor, told NBC’s “Meet the Press” that fail­ing to lift the debt ceil­ing would cause so much dis­rup­tion to the world econ­o­my that “the stand­ing of the U.S. econ­o­my would, again, be at risk.”

Indeed, the Unit­ed States’ errat­ic pol­i­cy mak­ing has kin­dled fears that the dol­lar could lose its perch as the world’s reserve cur­ren­cy — what the for­mer French pres­i­dent Valéry Gis­card d’Estaing, while de Gaulle’s finance min­is­ter, once called America’s “exor­bi­tant priv­i­lege.”

Today almost two-thirds of the world’s for­eign cur­ren­cy reserves are held in dol­lar assets, most­ly Trea­sury bonds. Near­ly half the for­eign debt secu­ri­ties in the world are in dol­lars, as are more than half the world’s cross-bor­der loans and deposits.

It made sense for oth­er coun­tries to embrace the dol­lar in an ear­li­er era, when the Unit­ed States was will­ing to act as guar­an­tor of glob­al sta­bil­i­ty. But today, with Repub­li­cans in Con­gress wield­ing default as a lever in a vain attempt to kill Oba­macare, per­haps it is no sur­prise that the rest of the world is get­ting more seri­ous about find­ing an alter­na­tive. .  .  .

11. Con­clud­ing with an out­look that applies to both the eco­nom­ic assault/terrorism inflict­ed on the U.S. by the GOP ele­ment of the “deep fifth col­umn” and Eddie the Friend­ly Spook and his fifth colum­nist asso­ciates, the pro­gram notes the glob­al atti­tude toward the Unit­ed States as a result of what we are see­ing. Both the actions of the “shutdown”/Paulistinian Lib­er­tar­i­an Orga­ni­za­tion milieu and those of Eddie the Friend­ly Spook have left the world view­ing the U.S. in fear and dis­may. Note that Chi­na, in par­tic­u­lar, is dis­mayed at the Paulis­tin­ian Lib­er­tar­i­an Orga­ni­za­tion’s actions, because of the poten­tial dam­age to the dol­lar. Much of Chi­na’s for­eign cur­ren­cy reserves are held in dol­lars.

Amer­i­can and Oba­ma admin­is­tra­tion rela­tions with Chi­na were also the tar­get of the actions of Snow­den’s “op”.

“View­ing the U.S. in Fear and Dis­may” by Damien Cave; The New York Times; 10/16/2013.

. . . . Faced with Washington’s march toward a default, the world has react­ed most­ly with dis­be­lief that the reign­ing super­pow­er could fall into such dys­func­tion, wor­ry over glob­al suf­fer­ing to come and frus­tra­tion that Amer­i­can law­mak­ers could let the prob­lem reach this point. . . .

A com­mon ques­tion cross­ing con­ti­nents remains quite sim­ple: The Amer­i­cans aren’t real­ly that unrea­son­able and self-destruc­tive, are they? . . . .

 


 


Discussion

No comments for “FTR #759 The Adventures of Eddie the Friendly Spook, Part 6: More About the Deep Fifth Column”

Post a comment