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

For The Record  

FTR #407 Pecunia Nervus Belli

MP3: Side 1 | Side 2

Intro­duc­tion: The title trans­lates: “Mon­ey is the sinew of war.” The pro­gram fur­ther devel­ops the top­ic of the geopo­lit­i­cal and macro­eco­nom­ic strug­gle between the dol­lar and the euro and relates it to the events of 9/11, the Iraq war and the Asian economies. Par­tic­u­lar empha­sis is on the air­line trav­el indus­try, the air­craft man­u­fac­tur­ing indus­try, the SARS epi­dem­ic and the con­test between Boe­ing and the Euro­pean aero­space man­u­fac­tur­er EADS—the man­u­fac­tur­er of the Air­bus. EADS has been pres­sur­ing Boe­ing to price its prod­uct in euros, mir­ror­ing the con­test between the dol­lar and the euro evi­denced in Iraq’s pric­ing of its oil in euros. The 9/11 attacks and SARS have depressed the air­line and air­craft man­u­fac­tur­ing busi­ness­es: Mr. Emory asks whether both events may be an out­growth of the Under­ground Reich’s appli­ca­tion of the con­cept of total war devel­oped by Karl Von Clause­witz. Von Clause­witz under­stood that war is waged in its totally—against all aspects of the enemy’s society—its econ­o­my, its morale and its social fab­ric, as well as against the mil­i­tary forces of the oppo­nent. At the core of the dis­cus­sion is the con­cept of both the euro and the US cur­rent accounts deficit as weapons of war which will, in time (if the sit­u­a­tion is not cor­rect­ed,) destroy the Unit­ed States as effec­tive­ly as ter­ror­ists or armies.

Pro­gram High­lights Include: the role of Asian cen­tral banks in prop­ping up Bush’s Iraq war by invest­ing in dol­lar-denom­i­nat­ed issues; the pos­si­ble effect of SARS on the glob­al econ­o­my and (con­se­quent­ly) the US cur­rent accounts deficit; the effect of SARS on the air­lines busi­ness; the effect of SARS on the air­craft man­u­fac­tur­ing busi­ness; the coin­ci­dent effects on the dol­lar and on Asian economies of SARS; the unsuc­cess­ful attempt by vet­er­ans of Project Coast to trans­fer their resid­ual BW weapons to the Unit­ed States; the role of GOP heavy­weight Grover Norquist as the point man for the Repub­li­can tax-cut­ting plan and as the Islamist point man in the GOP; the pro­ject­ed effects of Norquist’s tax cuts and the effects of the 9/11 attacks by his Islamist bud­dies on the US cur­rent accounts deficit; Bush’s use of counter-ter­ror fund­ing to fur­ther his socio-eco­nom­ic and polit­i­cal goals.
1. Begin­ning with review of an arti­cle that was fea­tured in FTR 405, the pro­gram intro­duces the eco­nom­ic con­text in which the events ana­lyzed here must be con­sid­ered. The assault against the US by the Under­ground Reich and its Islam­o­fas­cist allies that Mr. Emory believes to be under way is—in its pri­ma­ry manifestation—economic in nature. It can be argued per­sua­sive­ly that the goal of the gam­bit of the 9/11 attacks is the destruc­tion and/or sub­ju­ga­tion of the Unit­ed States. In FTR#405, Mr. Emory sug­gests that the attack, from a con­cep­tu­al point of view, could be viewed as a com­bi­na­tion of the Ger­man inva­sion of France in World War II, the bat­tle of Ver­dun in World War I, and Oper­a­tion Bern­hard in World War II. (For dis­cus­sion of the com­par­i­son of the Ger­man inva­sion of France in World War II to 9/11, see FTR#’s 366, 372, 395, 401.) The goal of the Ger­man high com­mand in the bat­tle of Ver­dun was to attack a posi­tion (the steel-mak­ing city of Ver­dun) that the French would not be will­ing to lose. In so doing, the Ger­mans hoped to bleed the French army dry—to inflict so many casu­al­ties that they would have to sue for peace. Oper­a­tion Bern­hard (see RFA#17—available from Spit­fire) was a Ger­man gam­bit intend­ed to destroy the British econ­o­my by forg­ing pound notes and destroy­ing the UK’s abil­i­ty to finance its war effort. The fol­low­ing arti­cle dis­cuss­es the eco­nom­ic aspects of the war with Iraq. Asian cen­tral banks’ sup­port of the dol­lar has—to date—made this an eas­i­er enter­prise to under­take than it might have been under dif­fer­ent cir­cum­stances. This sit­u­a­tion might change should the eco­nom­ic land­scape be altered in a sig­nif­i­cant fash­ion. Note the US cur­rent accounts deficit. “The 19th cen­tu­ry British polit­i­cal econ­o­mist Wal­ter Bage­hot had a pithy quote from Louis XIV on war finance. The last guinea, said the Sun King, will always win. In the case of Iraq it will be the last US dol­lar. And one of the more remark­able things about the US-led inva­sion of Iraq is just how eas­i­ly and cheap­ly the ven­ture will be financed. On the face of it, war has rarely been waged in such inaus­pi­cious finan­cial cir­cum­stances. At a time of extreme geopo­lit­i­cal uncer­tain­ty the pay­ments bal­ances of the world’s biggest economies are bad­ly out of kil­ter. US house­hold sav­ings are seri­ous­ly deplet­ed and the deficit on the cur­rent account of the Amer­i­can bal­ance of pay­ments is close to an unprece­dent­ed 5 per cent gross domes­tic prod­uct.”
(“The Sinews of War are Asian” by John Plen­der; Finan­cial Times; 3/21/2003; p. 17.)
2. The rel­a­tive­ly strong posi­tion of the dol­lar (in turn result­ing from invest­ment in dol­lar-denom­i­nat­ed IOU’s) stems from the rel­a­tive strength of Asian economies and their cen­tral banks’ invest­ments in the dol­lar.

“The US has, since the burst­ing of the stock mar­ket bub­ble, become a rel­a­tive­ly unat­trac­tive des­ti­na­tion for for­eign pri­vate cap­i­tal. Inter­est rates are low, the dol­lar is weak and the US econ­o­my will advance this year at less than its under­ly­ing trend growth rate. Yet as pri­vate cap­i­tal has fought increas­ing­ly shy of the world’s largest econ­o­my, the cen­tral bankers have come to George W. Bush’s res­cue. Japan, Chi­na, Tai­wan, Hong Kong and Sin­ga­pore alone have accu­mu­lat­ed offi­cial reserves worth more than $1,100bn, of which the great major­i­ty is invest­ed in dol­lar-denom­i­nat­ed IOU’s such as US Trea­suries. For many cen­tral banks these reserves are earn­ing much less in inter­est than they could earn back at home.”

3. If the US should become enmeshed in a cost­ly post-war, or if the Bush administration’s plans to dras­ti­cal­ly increase mil­i­tary spend­ing while dra­mat­i­cal­ly slash­ing tax­es on the wealthy should come to fruition, the effect on the dol­lar and the US cur­rent accounts deficit could be dis­as­trous and deci­sive.

“This is not, of course, a phil­an­thropic ges­ture. For Japan, with a stag­nant econ­o­my, it is a mat­ter of resist­ing an appre­ci­a­tion of the yen that would hit the export sec­tor. The oth­ers main­tain a dol­lar peg, large­ly for rea­sons of com­pet­i­tive­ness . . . Yet it remains the case that glob­al finance has been excep­tion­al­ly kind to Mr. Bush. And Louis XIV was indeed express­ing an age-old ver­i­ty. The Tac­i­tus ver­sion was pecu­nia nervus bel­li: mon­ey is the sinew of war. We should not for­get that unlim­it­ed mon­ey, how­ev­er help­ful, can­not guar­an­tee the peace.”

4. Against the back­ground of Bush’s fis­cal­ly-insane tax cut pro­pos­als, the US bud­getary sit­u­a­tion is not to be ignored. The only rea­son the US got away with the sui­ci­dal fis­cal poli­cies of the Rea­gan and Bush admin­is­tra­tions is the fact that the US was able to bor­row against the dol­lars held as reserve cur­ren­cy. A sig­nif­i­cant­ly weak­ened dol­lar and exac­er­bat­ed cur­rent accounts deficit for the US will dras­ti­cal­ly weak­en the coun­try.

“The US government’s finances are set to head sharply into deficit and stay there ‘for the fore­see­able future,’ the White House bud­get direc­tor said yes­ter­day. Mitchell Daniels, direc­tor of the Office of Man­age­ment and Bud­get (OMB), said he expect­ed fed­er­al deficits equiv­a­lent to 2–3 per cent of gross domes­tic prod­uct for this fis­cal year and next, and could not say when the bud­get would return to sur­plus.”

(“US Finances Set to Head ‘Sharply into Deficit’” by Alan Beat­tie; Finan­cial Times; Jan­u­ary 16, 2003; p. 2.)

5. The pro­gram reviews Grover Norquist’s role as pri­ma­ry tax-slash­er. In this con­text, it is impor­tant to remem­ber that he is also the point man for the Islamists in the Repub­li­can Par­ty. Note that these Islamists’ attacks on the Unit­ed States pre­cip­i­tat­ed the nation­al secu­ri­ty build-up which, when com­bined with the Bush tax cuts, has led to a return to record bud­get deficits. Whether Norquist is ful­ly con­scious of the effects of his actions is not par­tic­u­lar­ly rel­e­vant. In FTR#327, the col­lapse of the com­modi­ties mar­ket effect­ed by the Under­ground Reich is worth not­ing. When cou­pled with the assas­si­na­tion of JFK, it led to a huge prof­it for the Under­ground Reich per­pe­tra­tors of these events. Tino De Ange­lis was (appar­ent­ly) under mind con­trol and not aware of the impli­ca­tions of his actions. The same may be true of Norquist.

“Reac­tion from advo­cates and crit­ics was swift and strong. ‘It’s a tax shel­ter for the wealthy. This is real­ly an attempt to help the president’s friends,’ said Rep. Robert t. Mat­sui, D‑Sacramento. ‘It’s unbe­liev­able.’ ‘These are the build­ing blocks of a new tax sys­tem,’ said Grover Norquist, pres­i­dent of the con­ser­v­a­tive Amer­i­cans for Tax Reform.”

(“Bush Pro­pos­es New Tax-Free Sav­ings Plans” by Peter G. Gos­selin; The Los Ange­les Times; 2/1/2003; p. A20.)

6. One should note the reac­tion of some Islamists to the Iraq war. Some have called for Mus­lims to embrace the euro as opposed to the dol­lar. The issue of the dol­lar vs. the euro is at the core of the the­sis Mr. Emory has been devel­op­ing about the 9/11 attacks and their macro­eco­nom­ic effect on the US. The reac­tion expressed by the Mus­lim cler­ic in this arti­cle goes to the heart of the dis­cus­sion from past broad­casts about the Earth Island and the Under­ground Reich’s attempts at gain­ing polit­i­cal con­trol of that area’s pop­u­la­tion and effect­ing eco­nom­ic advan­tage as a result.

“In this sandswept Niger­ian town on the edge of the Sahara Desert, a Mus­lim cler­ic, dis­play­ing anger about the U.S. war in Iraq, recent­ly exhort­ed his fol­low­ers to take action to inflict pain on the U.S. name­ly, ditch the dol­lar and embrace the euro. ‘Euro­pean Coun­tries,’ preached Sheik Ibrahim Umar Kabo, the head of Nigeria’s Coun­cil of Mus­lim Schol­ars, ‘have refused to be fooled by Amer­i­ca’ and sup­port the war. ‘We should there­fore encour­age trans­ac­tions with the euro and stop patron­iz­ing the Amer­i­can dol­lar.’ The sheik’s advice was met with cries of ‘Down with Amer­i­ca.’ The enthu­si­asm spilled out into the streets with the faith­ful shout­ing, ‘Euro yes! Dol­lar no!’”

(“Some Mus­lims Advo­cate Dump­ing the Dol­lar for the Euro” by Robert Block; The Wall Street Jour­nal; 4/15/2003; p. C1.)

7. An arti­cle not includ­ed in the orig­i­nal pro­gram notes the effect of the euro on the geopol­i­tics sur­round­ing the Franco/German oppo­si­tion to the war.

“It was the euro—not the Secu­ri­ty Coun­cil veto—that enabled France to oppose U.S. pol­i­cy on Iraq so bold­ly. Indeed, the suc­cess of the Euro­pean cur­ren­cy has turned it into a polit­i­cal anti-mis­sile shield that works, and that has changed the inter­na­tion­al bal­ance of pow­er. Absent the euro, it would have been rel­a­tive­ly easy for the U.S. to qui­et­ly bring the French back into line. A stealth U.S. attack on the French franc, and on French finan­cial markets—more like­ly just the hint of it—would do the job . . . With the Cold War behind us, the key ques­tion of inter­na­tion­al pol­i­tics, as seen by the French polit­i­cal and admin­is­tra­tive elite, is this: Now that there is no mil­i­tary threat to Europe from the Sovi­et Union, or any­one else, how to con­tain the US? In this log­ic, the euro must become an alter­na­tive, or co-reserve cur­ren­cy along­side the dol­lar.”

(“Euro Shield” by Stephen S. Cohen; The Wall Street Jour­nal; 4/29/2003; p. A16.)

8. One of the major points of dis­cus­sion in this broad­cast is SARS. Is it a nat­u­ral­ly-occur­ring dis­ease or is it the prod­uct of bio­log­i­cal war­fare? If the lat­ter is the case, is it pos­si­ble that SARS may be an appli­ca­tion of the Von Clause­witz con­cept of total war? Much of the pro­gram con­sid­ers the effect of SARS on the air­line indus­try, the air­craft man­u­fac­tur­ing busi­ness, and on the strength of the dol­lar.

“It has all the appear­ance of a per­fect storm. A vir­u­lent con­flu­ence of fac­tors has shak­en the glob­al econ­o­my in recent weeks and caused com­pa­nies to put inter­na­tion­al busi­ness on hold. The most dis­rup­tive have been the flu­like severe acute res­pi­ra­to­ry syn­drome from Asia and the war in Iraq with its asso­ci­at­ed fear of ter­ror­ism . . . Com­pli­cat­ing the pos­si­ble long-term effects of the war is its tim­ing: The war is being fought while the U.S. econ­o­my is still strug­gling. The dol­lar has fall­en by 17 per­cent against the euro since ear­ly 2002, mak­ing imports from coun­tries such as Ger­many and France cost­ly for Amer­i­cans [Empha­sis added.”

(“Eco­nom­ic Tsuna­mi” by David Arm­strong; San Fran­cis­co Chron­i­cle; 4/6/2003; p. B1.)

9. Con­sid­er­ing the pos­si­ble eco­nom­ic impact of the dis­ease, a WHO offi­cial notes the poten­tial­ly severe impli­ca­tions of SARS.

“The SARS dis­ease pos­es one of the most seri­ous glob­al health threats since Aids because of its infec­tious­ness and poten­tial to spread through air trav­el, the World Health Orga­ni­za­tion warned yes­ter­day. It said oth­er dis­eases that have emerged in recent decades, such as Ebo­la, had high­er fatal­i­ty rates but tend­ed to be focused on lim­it­ed geo­graph­ic areas and were not as eas­i­ly passed on. ‘SARS could become the first severe new dis­ease of the 21st cen­tu­ry with glob­al epi­dem­ic poten­tial,’ said Dr. David Hey­mann, exec­u­tive direc­tor of WHO’s com­mu­ni­ca­ble dis­ease pro­grams.”

(“SARS Could Spread World­wide, Warns WHO” by Joe Leahy; Finan­cial Times; 4/12/13/2003; p. 1.)


“The dis­ease has affect­ed hotel and air­line book­ings across Asia and led econ­o­mists to revise down their fore­casts for region­al growth. Dr. Hey­mann said glob­al eco­nom­ic con­se­quences were already esti­mat­ed at about US$30bn. He said the disease’s incu­ba­tion peri­od of up to 10 days meant it could be trans­port­ed in symp­tom­less air trav­el­ers all over the world.”

11. Mir­ror­ing the fears of the WHO offi­cial dis­cussed above, an ana­lyst with Mor­gan Stan­ley fears the eco­nom­ic impact of the dis­ease.

“With the Chi­nese now reluc­tant to travel—not just over­seas but also at home—and with Asian coun­tries restrict­ing the entry of vis­i­tors from affect­ed areas, the SARS effect could eas­i­ly esca­late. Mor­gan Stan­ley has pared its 2003 esti­mate of growth in Asia (ex Japan) from 5 per cent to 4.5 per cent. This assumes a 60 per cent fall in tourism over the next three months and then a return to nor­mal. Unfor­tu­nate­ly the SARS effect is con­cen­trat­ed on Asia—the region of the world that we had count­ed on to keep the glob­al econ­o­my afloat. With this source of glob­al resilience now being under­mined, the glob­al econ­o­my has lit­tle left to sup­port it. Had eco­nom­ic growth been more vig­or­ous before the out­break of SARS, this prob­a­bly would not have made such a dif­fer­ence. Sad­ly, that is not the case. There is far more to the sto­ry of emerg­ing glob­al weak­ness than a SARS-relat­ed down­turn in Asia. War, and the relat­ed uncer­tain­ties are equal­ly impor­tant fac­tors. But SARS may be the tip­ping point.”

(“Asia Sneezes and the World Catch­es a Cold” by Stephen Roach; Finan­cial Times; 4/14/2003; p. 15.)

12. Eco­nom­ic colum­nist Paul Krug­man also notes the poten­tial impact of SARS on the glob­al and US economies.

“Seri­ous peo­ple know that germs pose a far greater threat to mankind than ter­ror­ism, and read­ers of books like William McNeill’s ‘Plagues and Peo­ples’ and Jared Diamond’s ‘Guns, Germs and Steel’ know microbes have been the down­fall of many a civ­i­liza­tion. SARS—severe acute res­pi­ra­to­ry syn­drome, a new virus from Guang­dong Province in China—doesn’t look like a civ­i­liza­tion-killer, and prob­a­bly isn’t near­ly as bad as the 1918–19 influen­za virus. But experts fear it may be too late to pre­vent a glob­al SARS pandemic—that is, it may be too late to stop the virus from spread­ing through­out the world. And the bug is already hav­ing major eco­nom­ic con­se­quences; fear of the dis­ease has par­a­lyzed much busi­ness in Hong Kong and has led to a drop in air trav­el world­wide.”

(“Guns, Germs and Stall?” by Paul Krug­man; The New York Times; 4/4/2003; p. A19.)


“Even if SARS doesn’t become wide-spread here—and that’s not a safe bet—it can do a lot of dam­age to our own econ­o­my because the world has grown so inter­de­pen­dent. Con­sid­er this: the most like­ly engine of a vig­or­ous U.S. recov­ery would be a renewed surge in tech­nol­o­gy spend­ing, and Guang­dong is now the work­shop of the infor­ma­tion tech­nol­o­gy world, the place where a lot of the equip­ment that we would expect busi­ness­es to buy if there was an invest­ment boom—for exam­ple, com­po­nents for wire­less com­put­er networks—is assem­bled. The virus is already ham­per­ing pro­duc­tion, not so much because work­ers have become sick as because Tai­wan-based man­agers and engi­neers are afraid to vis­it their plants. The result may be to stall an invest­ment recov­ery before it starts. The war has monop­o­lized everyone’s atten­tion, includ­ing mine. But oth­er things are hap­pen­ing, and you shouldn’t be shocked if the eco­nom­ic news turns awful.”

14. In addi­tion to the above lines of analy­sis, the poten­tial effect of SARS on the US cur­rent accounts deficit is at the core of econ­o­mist Mar­tin Wolf’s analy­sis.

“The unbal­anced pat­tern of demand has gen­er­at­ed the patent­ly unsus­tain­able cur­rent accounts deficits and sur­plus­es not­ed by [IMF econ­o­mist Ken­neth] Rogoff. The world econ­o­my can­not build a strong and durable recov­ery on the profli­ga­cy of the Eng­lish-speak­ing coun­tries alone. Soon­er or lat­er such a glob­al­ly unbal­anced recov­ery will blow up, prob­a­bly with cur­ren­cy col­laps­es. [Ital­ics are Mr. Emory’s].”

(“A World Econ­o­my Trapped by Com­pla­cen­cy and Pan­ic” by Mar­tin Wolf; Finan­cial Times; 4/16/2003; p. 15.)


“The world is suf­fused with a mix­ture of com­pla­cen­cy and panic—complacency over the world econ­o­my and pan­ic over secu­ri­ty and now a new (and so far minor) dis­ease. The end of the war is an oppor­tu­ni­ty to redress the bal­ance. It must be seized.”

16. The Under­ground Reich’s con­tri­bu­tion of soft­ware for the mass pro­duc­tion of nuclear weapons was dis­cussed at length. John Lof­tus dis­cussed intel­li­gence infor­ma­tion main­tain­ing that Iraq and North Korea had shared infor­ma­tion about nuclear tech­nol­o­gy. With the inter­na­tion­al weapons trade cut­ting across ide­o­log­i­cal lines, is it pos­si­ble that North Korea’s nuclear capa­bil­i­ty may have come from the Under­ground Reich (per­haps via Iraq?) In that con­text, con­sid­er the pos­si­ble effect of the North Kore­an nuclear sit­u­a­tion on the Asian economies. Like SARS, the cri­sis may have a very dis­turb­ing out­come for the US. One should bear in mind that the Japan­ese hold rough­ly 15% of America’s for­eign debt. A dra­mat­ic wors­en­ing of the sit­u­a­tion vis-a-vis North Korea could pro­duce a seri­ous down­turn in the Japan­ese stock mar­ket and a result­ing liq­uid­i­ty cri­sis for Japan­ese banks. Should they sell off Amer­i­can T‑bills, it could col­lapse the US econ­o­my, by gen­er­at­ing a rush to dump the T‑bills by oth­er investors. Pecu­nia nervus bel­li. (* Note that this arti­cle was not in the orig­i­nal broad­cast.)

“A dif­fi­cult nego­ti­a­tion will be all the more per­ilous because, unlike Iraq, North Korea is adja­cent to advanced indus­tri­al economies with com­plex and pow­er­ful finan­cial mar­kets. Those economies now account for most of the world’s out­put growth. North Korea has tak­en hostage the pros­per­i­ty of the Asia Pacif­ic region. There is less pre­mon­i­to­ry blus­ter and less fer­vor in Wash­ing­ton, but the North Korea cri­sis could do far more dam­age to the glob­al econ­o­my than war in Iraq.”

(“A Kore­an Peace may Hurt More than an Iraqi War” by John Edwards; Finan­cial Times; 4/23/2003; p. 13.)


“It is true that the North Korea cri­sis is unlike­ly to devel­op like the con­flict over Iraq. The US will not invade North Korea. North Korea can­not make any claim to region­al lead­er­ship. It has no strate­gic resource such as oil, and it is almost com­plete­ly iso­lat­ed in glob­al pol­i­tics. And far from want­i­ng to go it alone, the US is insist­ing on mul­ti­lat­er­al rather than bilat­er­al talks. The dis­pute will prob­a­bly be peace­ful­ly resolved, but not with­out alarm­ing brinks­man­ship. For the economies of the Asia Pacif­ic region, this is the real prob­lem. Through the impact of threat and counter-threat on finan­cial mar­kets and cap­i­tal flows the region could suf­fer anoth­er eco­nom­ic calami­ty with­out a shot being fired.”

18. The piv­otal con­flict between the euro and the dollar—a cen­tral behind-the-scenes aspect of the Iraq war—is at the core of the fis­cal con­test between Boe­ing and the EU-man­u­fac­tured Air­bus. (For more about Air­bus and its con­nec­tions to the CDU fund­ing scan­dal and Karl-Heinz Schreiber, see FTR#194.) It is impor­tant to note that the 9/11 attacks had a huge, neg­a­tive impact on the air­line indus­try and (con­se­quent­ly) on Boeing’s air­craft man­u­fac­tur­ing busi­ness. Bear in mind the Ger­man asso­ciates of Mohammed Atta.

“The own­ers of Air­bus, the pan-Euro­pean air­craft mak­er, are seek­ing to per­suade their main US aero­space rival Boe­ing to adopt the euro as the bench­mark cur­ren­cy for the tra­di­tion­al­ly dol­lar-based com­mer­cial air­craft mar­ket. The call from Philippe Camus, co-chief exec­u­tive of the Fran­co-Ger­man Euro­pean Aero­nau­tic Defense and Space com­pa­ny (EADS), reflects the cost dis­ad­van­tage that Air­bus cur­rent­ly suf­fers fol­low­ing the sus­tained depre­ci­a­tion of the dol­lar against the euro. ‘Cur­ren­cies are a fac­tor of com­pe­ti­tion and we want to force Boe­ing to adopt our cur­ren­cy struc­ture,’ said Mr. Camus in his first inter­view since the death ear­li­er this month of Jean-Luc Lagardere, the EADS co-chair­man.”

(“Euro­peans Try to Pull Boe­ing into Euro” by Paul Betts and Mar­tin Arnold; Finan­cial Times; 3/25/2003; p. 20.)

“How­ev­er, Mr. Camus’ call also has a sym­bol­ic edge, reflect­ing the recent change in the bal­ance of pow­er in the civ­il air­craft mar­ket. Airbus—of which EADS owns 80 percent—last year claimed 54 per cent of new orders for large air­craft by units and dol­lar val­ue, with Boe­ing tak­ing the rest. . . . A sim­i­lar shift in base cur­ren­cies was pro­posed a year and a half ago by some oil pro­duc­ing coun­tries includ­ing Iran, Libya and Rus­sia, which sug­gest­ed that oil prices should be expressed in euros. Before the out­break of war, Iraq was already pric­ing its oil in euros. . . . A US oil indus­try ana­lyst yes­ter­day sug­gest­ed that there would only be a case for the euro to become the ref­er­ence cur­ren­cy for oil if it unseat­ed the US dol­lar to become the strongest cur­ren­cy on a last­ing basis.”
20. Again, the pres­sures of 9/11 have had a seri­ous and neg­a­tive effect on Boeing’s for­tunes. In some of Mr. Emory’s con­ver­sa­tions with Pro­fes­sor Wil­helm Stauf­fer in the ear­ly 1990s, Pro­fes­sor Stauf­fer detailed Lufthansa’s attempts at gain­ing con­trol of the air­line indus­try. Sub­si­dized by the Ger­man gov­ern­ment, Lufthansa may be in a posi­tion to gain from 9/11 and SARS. Air­bus may be in a sim­i­lar posi­tion. There is sub­stan­tive infor­ma­tion con­nect­ing 9/11 with the Under­ground Reich. Is it pos­si­ble that SARS may be an appli­ca­tion of Von Clausewitz’s con­cept of Total War to bio­log­i­cal war­fare and eco­nom­ics? Pecu­nia nervus bel­li.
“Boe­ing faces a crit­i­cal choice between spend­ing bold­ly to devel­op a new jet and hun­ker­ing down to play defense dur­ing the air­line industry’s worst down­turn ever. Two of the most pow­er­ful mem­bers of the company’s 11-per­son board are said to be rais­ing cost con­cerns about the 7E7, as they press Boe­ing to improve its earn­ings and stock price—even if that means sac­ri­fic­ing cut­ting-edge engi­neer­ing . . .”
(“Boe­ing, Los­ing Ground to Air­bus, Faces Key Choice” by J. Lynn Lunsford; The Wall Street Jour­nal; 4/21/2003; p. A1.)


“ . . . The case for Boe­ing hedg­ing its bets has appeal dur­ing a his­toric com­mer­cial-avi­a­tion slump. But it implies a will­ing­ness to cede mar­ket share to the industry’s only oth­er titan, Europe’s Air­bus. And the strat­e­gy strong­ly resem­bles the one McDon­nell Dou­glas employed as it sank to also-ran sta­tus in the 1990’s.”

22. As one observes the maneu­ver­ing on the inter­na­tion­al and eco­nom­ic stages, bear in mind the com­plex CDU fund­ing scan­dal that linked the French Elf oil com­pa­ny with a com­plex series of trans­ac­tions involv­ing the Thyssen firm, Sau­di Ara­bia, the Leu­na refin­ery in East Ger­many. Air­bus and the mys­te­ri­ous Karl-Heinz Schreiber are at the core of this scan­dal. The Ger­man dom­i­na­tion of cor­po­rate France is anoth­er fac­tor to con­sid­er in the con­text of the maneu­ver­ing around the Iraq war.

“This could yet throw light on kick­backs paid by Elf over a deal between Mr. Mit­terand and Ger­man ex-chan­cel­lor Hel­mut Kohl to invest in the Leu­na refin­ery in East Germany—an affair which helped bring Mr. Kohl down.”

(“French Tri­al Paints a Pic­ture of Graft on a Grandiose Scale” by Robert Gra­ham; Finan­cial Times; 4/22/2003; p. 14.)

23. Next, the pro­gram dis­cuss­es the impact of SARS on the air trav­el busi­ness. Will this por­tend well for Air­bus and poor­ly for Boe­ing?

“Two of Asia’s biggest air car­ri­ers, Cathay Pacif­ic Air­ways and Sin­ga­pore Air­lines, announced deep cut­backs on Fri­day because pas­sen­gers have been scared off by a vir­u­lent res­pi­ra­to­ry dis­ease in the region. Cathay Pacif­ic said that it would oper­ate 37 per­cent few­er flights than it had pre­vi­ous­ly planned. Sin­ga­pore Air­lines said it would cut 19.7 per­cent of its flights. Both air­lines said their reduc­tions in ser­vice would last through the end of May. The fig­ures include the more mod­est reduc­tions in ser­vice announced in the past two weeks.”

(“Two Asian Air­lines Cut Back Because of SARS Impact” by Kei­th Brad­sh­er [New York Times]; San Jose Mer­cury News; 4/12/2003; p. 2C.)

24. SARS appears to be caused by an entire­ly new coro­na virus. Is it pos­si­ble that this dis­ease was delib­er­ate­ly pro­duced?

“ . . . Cana­di­an researchers said the genome appears to be that of a ‘com­plete­ly new’ coro­n­avirus unre­lat­ed to any known human or ani­mal virus.”

(“Team Decodes SARS Virus” by Don­ald G. McNeil Jr. [New York Times]; 4/14/2003; p. A3.)

25. In the con­text of the advent of SARS, it is inter­est­ing (and pos­si­bly sig­nif­i­cant) that vet­er­ans of Project Coast were recent­ly turned down in their attempts at trans­fer­ring their inven­to­ry to the US. (For more about Project Coast and its con­nec­tions to Amer­i­can per­son­nel, see FTR#’s 225, 317, 324, 386.) Could the Project Coast alum­ni have had any­thing to do with SARS?

“Daan Goosen’s call­ing card to the FBI was a vial of bac­te­ria he had freeze-dried and hid­den inside a tooth­paste tube for secret pas­sage to the Unit­ed States. From among hun­dreds of flasks in his Pre­to­ria lab, the South African sci­en­tist picked a man-made strain that was sure to impress: a micro­bial Franken­stein that fused the genes of a com­mon intesti­nal bug with DNA from the pathogen that caus­es the dead­ly ill­ness gas gan­grene. ‘This will show the Amer­i­cans what we are capa­ble of,’ Goosen said at the time.”

(“Vile Vials Live on in South Africa” by Joby War­rick and John Mintz [Wash­ing­ton Post]; San Fran­cis­co Chron­i­cle; 4/20/2003; p. A16.)

“On May 6, 2002, Goosen slipped the par­cel to a retired CIA offi­cer who couri­ered the microbes 8,000 miles for a drop-off with the FBI. If U.S. offi­cials liked what they saw, Goosen said he was pre­pared to offer much more: an entire col­lec­tion of pathogens devel­oped by a secret South African bio-weapons research pro­gram Goosen once head­ed. Goosen’s extra­or­di­nary offer to the FBI, out­lined in obtained doc­u­ments and inter­views with key par­tic­i­pants, promised scores of addi­tion­al vials con­tain­ing the bac­te­ria that cause anthrax, plague, sal­mo­nel­la and bot­u­lism, as well as anti­dotes for many of the dis­eases. Sev­er­al strains had been genet­i­cal­ly altered, a tech­nique used by weapons sci­en­tists to make dis­eases hard­er to detect and defeat. All were to be deliv­ered to the U.S. gov­ern­ment for safe­keep­ing and to help strength­en U.S. defens­es against future ter­ror­ism attacks . . . ”

“ . . . Par­tic­i­pants in the failed deal dif­fer on what hap­pened and why. But they agree that the bac­te­r­i­al strains remain in pri­vate hands in South Africa, where they have con­tin­ued to attract atten­tion from indi­vid­u­als inter­est­ed in acquir­ing them . . .”

28. In describ­ing the efforts at mov­ing the South African BW sam­ples, Goosen makes ref­er­ence to Project Coast vet­er­ans who had been using the inven­to­ry for pri­vate indus­tri­al projects. Dr. Lar­ry Ford’s “Inner Con­fi­dence” sup­pos­i­to­ry was one such project.

“ . . . South African offi­cials claimed to have destroyed all of Project Coast’s bio­log­i­cal mate­ri­als in 1993. But Goosen says many sci­en­tists kept copies of organ­isms and doc­u­ments to con­tin­ue work on ‘dual-use’ projects with com­mer­cial as well as mil­i­tary appli­ca­tions. Goosen’s vac­cine pro­duc­tion lab end­ed up with hun­dreds of strains, at least half of which were from Project Coast . . .”

(Ibid.; p. A17.)

29. Note that a Ger­man and an appar­ent Arab were among those who sought access to Project Coast’s inven­to­ry.

“ . . . In the past nine months, the sci­en­tist has been offered mon­ey by a Ger­man trea­sure-hunter and a man claim­ing to be an Arab Sheikh. Goosen says he turned the offers down, but wor­ries about future bioter­ror­ism. ‘A small con­tain­er of pathogens could kill a mil­lion peo­ple,’ he said.”

(Ibid.; p. A17.)

30. The broad­cast con­cludes with dis­cus­sion of the dis­turb­ing use of counter-ter­ror­ism to pro­vide a dis­pro­por­tion­ate­ly large amount of fund­ing to the peo­ple of states that vot­ed for George Bush. Mr. Emory notes that the “blue states” are basi­cal­ly the areas that are destroyed in the Nazi tract Serpent’s Walk. This sub­ject will be tak­en up at greater length in FTR#409.

“ . . . What Mr. Chait doesn’t point out is the extent to which already inad­e­quate antiter­ror­ism spend­ing has been focused on the parts of the coun­try that need it least. I’ve writ­ten before about the myth of the heartland—roughly speak­ing, the ‘red states,’ which vot­ed for George W. Bush in the 2000 elec­tion, as opposed to the ‘blue states,’ which vot­ed for Al Gore. The nation’s inte­ri­or is sup­pos­ed­ly a place of rugged indi­vid­u­al­ists, unlike the spongers and whin­ers along the coasts. In real­i­ty, of course, rur­al states are heav­i­ly sub­si­dized by urban states. New Jer­sey pays about $1.50 in fed­er­al tax­es for every dol­lar it gets in return; Mon­tana receives about $1.75 in fed­er­al spend­ing for every dol­lar it pays in tax­es.”

(“A Red-Blue Ter­ror Alert” by Paul Krug­man; The New York Times; 4/1/2003; p. 1;.)


“Any sen­si­ble pro­gram of spend­ing on home­land secu­ri­ty would at least part­ly redress this bal­ance. The most nat­ur­al tar­gets for ter­ror­ism lie in or near great met­ro­pol­i­tan areas; sure­ly pro­tect­ing those areas is the high­est pri­or­i­ty, right? Appar­ent­ly not. Even in the first months after Sept. 11, Repub­li­can law­mak­ers made it clear that they would not sup­port any major effort to rebuild or even secure New York. And now that anti-urban prej­u­dice has tak­en sta­tis­ti­cal form; under the for­mu­la the Depart­ment of Home­land Secu­ri­ty has adopt­ed for hand­ing out mon­ey, it spends 7 times as much pro­tect­ing each res­i­dent of Wyoming as it does pro­tect­ing each res­i­dent of New York.”

(Ibid.; pp. 1–2.)


2 comments for “FTR #407 Pecunia Nervus Belli”

  1. http://en.wikipedia.org/wiki/Vela_Incident

    The Vela Inci­dent (some­times referred to as the South Atlantic Flash) was an uniden­ti­fied “dou­ble flash” of light that was detect­ed by an Amer­i­can Vela Hotel satel­lite on Sep­tem­ber 22, 1979.
    Some spe­cial­ists who exam­ined the data spec­u­lat­ed that the dou­ble flash, char­ac­ter­is­tic of a nuclear explo­sion, may have been the result of a nuclear weapons test: “The con­clu­sions of the Pres­i­den­tial pan­el (the Ad Hoc Pan­el) were reas­sur­ing, as they sug­gest­ed that the most like­ly expla­na­tion of the Vela detec­tion was a mete­oroid hit­ting the satel­lite — in part because of the dis­crep­an­cy in bhang­me­ter read­ings. Oth­ers who exam­ined the data, includ­ing Defense Intel­li­gence Agency (DIA), the nation­al lab­o­ra­to­ries, and defense con­trac­tors reached a very dif­fer­ent con­clu­sion — that the data sup­port­ed the con­clu­sion that on 22 Sep­tem­ber 1979, Vela 6911 had detect­ed a nuclear detonation.”[1][2]

    [ ... ]

    The “dou­ble flash” was detect­ed on Sep­tem­ber 22, 1979, at 00:53 GMT, by the Amer­i­can Vela Hotel satel­lite 6911, which car­ried var­i­ous sen­sors that had been designed specif­i­cal­ly to detect nuclear explo­sions. In addi­tion to being able to detect gam­ma rays, x‑rays, and neu­trons, the satel­lite also con­tained two sil­i­con sol­id-state bhang­me­ter sen­sors that would be able to detect the dual light flash­es asso­ci­at­ed with a nuclear explosion—to be spe­cif­ic the ini­tial brief, intense flash, fol­lowed by the sec­ond longer flash.[2]
    The satel­lite report­ed the char­ac­ter­is­tic dou­ble flash of an atmos­pher­ic nuclear explo­sion of two to three kilo­tons, in the Indi­an Ocean between The Crozet Islands (a very small, sparse­ly inhab­it­ed French pos­ses­sion) and the Prince Edward Islands which belong to South Africa at 47°S 40°ECoordinates: 47°S 40°E.

    [ ... ]

    In Feb­ru­ary 1994, Com­modore Dieter Ger­hardt, a con­vict­ed Sovi­et spy and the com­man­der of South Africa’s Simon’s Town naval base at the time, talked about the inci­dent upon his release from prison. He said:
    Although I was not direct­ly involved in plan­ning or car­ry­ing out the oper­a­tion, I learned unof­fi­cial­ly that the flash was pro­duced by an Israeli-South African test, code-named Oper­a­tion Phoenix. The explo­sion was clean and was not sup­posed to be detect­ed. But they were not as smart as they thought, and the weath­er changed – so the Amer­i­cans were able to pick it up.[29]

    April 20, 1997, the Israeli dai­ly news­pa­per Haaretz quot­ed the South African Deputy For­eign Min­is­ter, Aziz Pahad, as sup­pos­ed­ly con­firm­ing that the “dou­ble flash” from over the Indi­an Ocean was indeed from a South African nuclear test. Haaretz also cit­ed past reports that Israel had pur­chased 550 tons of ura­ni­um from South Africa for its own nuclear plant in Dimona. In exchange, Israel alleged­ly sup­plied South Africa with nuclear weapons design infor­ma­tion and nuclear mate­ri­als to increase the pow­er of nuclear warheads.[30] This state­ment was con­firmed by the Unit­ed States Embassy in Pre­to­ria, South Africa,[16][31] but Pahad’s press sec­re­tary stat­ed that Pahad had said only that “there was a strong rumor that a test had tak­en place, and that it should be inves­ti­gat­ed”. In oth­er words – he was mere­ly repeat­ing rumors that had been cir­cu­lat­ing for years.[32][33]

    In Octo­ber 1999, a white paper that was pub­lished by the U.S. Sen­ate Repub­li­can Pol­i­cy Com­mit­tee in oppo­si­tion to the Com­pre­hen­sive Test Ban Treaty stat­ed:
    There remains uncer­tain­ty about whether the South Atlantic flash in Sep­tem­ber 1979 record­ed by opti­cal sen­sors on the U.S. Vela satel­lite was a nuclear det­o­na­tion and, if so, to whom it belonged.[34]
    In his 2006 book On the Brink, the retired C.I.A. clan­des­tine ser­vice offi­cer, Tyler Drumheller, wrote of his 1983–88 tour-of-duty in South Africa:
    We had oper­a­tional suc­cess­es, most impor­tant­ly regard­ing Pre­to­ri­a’s nuclear capa­bil­i­ty. My sources col­lec­tive­ly pro­vid­ed incon­tro­vert­ible evi­dence that the apartheid gov­ern­ment had in fact test­ed a nuclear bomb in the South Atlantic in 1979, and that they had devel­oped a deliv­ery sys­tem with assis­tance from the Israelis.

    Posted by R. Wilson | November 26, 2011, 7:16 pm
  2. @R. Wil­son: I’ve heard of this as well. Why was this so heav­i­ly con­cealed, and if South Africa man­aged to build more nukes, where have they gone since the end of 1994? Makes you won­der, does­n’t it?

    Posted by Steven l. | November 27, 2011, 6:18 pm

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