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

For The Record  

FTR #812 Kim Dotcom and Divine Laissez Faire Economics

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Side 1  Side 2


Intro­duc­tion: In the after­math of the 2012 arrest of Kim Schmitz aka “Kim Dot­com” in the wake of the MegaU­pload take­down by the fed­er­al gov­ern­ment, Herr Doc­tom has been var­i­ous­ly por­trayed as a mar­tyr for inter­net free­dom and the Sec­ond Com­ing of Christ by his cyber-lib­er­tar­i­an sup­port­ers and as the Beast of the Apoc­a­lypse by his detrac­tors. There is anoth­er pos­si­bil­i­ty that sug­gests itself.

Per­haps Kim is actu­al­ly in cahoots with some of the very same inter­ests he would have us believe he oppos­es. One should attempt to “fol­low the mon­ey,” as was advised to Water­gate inves­ti­ga­tors Bob Wood­ward and Carl Bern­stein.
A num­ber of things are appar­ent when one exam­ines Herr Dot­com­man­dant:
  • This guy is a 1 per­center and proud of it, giv­en to noth­ing so much as con­spic­u­ous con­sump­tion.
  • There’s more to this guy than meets the eye and there is PLENTY of him that meets the eye.
  • At the time of his arrest, he had a bunch of cred­it cards in dif­fer­ent names and mul­ti­ple pass­ports in var­i­ous names. (Schmitz/Dotcom changes names fre­quent­ly, a prac­tice that would impede data­base search­es for his name.)
  • QUICK: How many dif­fer­ent cred­it cards and pass­ports in how many dif­fer­ent names do YOU have?
  • Schmitz/Dotcom is a “turned hacker”–a hack­er who for­sook his life of crime to coop­er­ate with the author­i­ties to devel­op com­put­er secu­ri­ty sys­tems. Julian Assange appears to be anoth­er “turned hack­er.’
  • As such, Dot­com­man­dant may be viewed as an “inside play­er,” at least to an extent.
  • He was con­vict­ed of a num­ber of crimes, which did not pre­vent rel­a­tive­ly pres­ti­gious com­pa­nies from back­ing some of his fraud­u­lent undeer­tak­ings.
  • Con­vict­ed in what was the largest insid­er trad­ing scan­dal in Ger­many up to that time, he fled Ger­many and was giv­en 20 months pro­ba­tion and a 100,000 euro fine. The Dot­com­man­dant alleged­ly earned $115,000 a day in his lat­est gig. A 100,000 euro fine is basi­cal­ly dock­ing the guy a day’s pay. He got 20 months probation–no jail time. That alto­geth­er gen­tle wrist slap may indi­cate that he has good rela­tions with the pow­ers that be. It cer­tain­ly was not a pun­ish­ment that would deter the likes of the Dot­com­man­dant. (Note that, in gen­er­al, Euro­pean sen­tenc­ing in crim­i­nal cas­es is lighter than in the U.S. Still, that’s not much of a sen­tence for the largest insid­er trad­ing scheme in Ger­many up to that point in time. Remem­ber he fled the coun­try to escape jus­tice. The arti­cle below describes the pun­ish­ment met­ed out to do Schmitz as “repeat­ed lash­es with a wet noo­dle.” Why?
  • Food for Thought:
  • With his over-the-top per­sona and jet set lifestyle, he’s not the best poster boy for cyber-lib­er­tar­i­an­sim. Look­ing like a Goth Drew Carey on steroids, he presents a bizarre phys­i­cal appear­ance to go with his “1 persense­less” behav­ior, mak­ing it dif­fi­cult for many to feel sym­pa­thy.
  • MegaU­pload appears to have tak­en com­mer­cial prod­uct pro­duced by oth­ers and then tak­en it to mar­ket at con­sid­er­able prof­it for them­selves. In essence, that’s theft. Seen by his sup­port­ers as some­thing of a mod­ern Robin Hood, that con­struct would have more valid­i­ty if Our Hero were to dis­trib­ute some of his evi­dent wealth to the grips and oth­er lit­tle folks who worked on the films MegU­pload pirates. If, for the sake of argu­ment, one of these giant media cor­po­ra­tions were brought down by pirat­ed down­load, the Big Boys (and Girls) will float gen­tly to earth on their gold­en para­chutes, while the grips go into “white knuck­le mode.”
  • Note that pirat­ed down­load, among oth­er things, deprives gov­ern­ments at var­i­ous lev­els of sales and income tax rev­enues, plac­ing added strain and their bud­gets. Ulti­mate­ly, the more those bud­gets are strained, the more peo­ple get laid off from their jobs–police, fire­fight­ers, DMV clerks etc . In FTR #732, we not­ed that the Pirate Bay case fea­tured a clash between two right-wing views: it’s OK to steal rev­enue from gov­ern­ments but NOT OK to steal rev­enue from cor­po­ra­tions. The same appears to apply in the MegaU­pload case.
  • The Dot­com­man­dant has appar­ent­ly engaged in a vari­ety of crim­i­nal activ­i­ties in the past.
  • ‘The tim­ing of this bust, com­ing so soon after the jus­ti­fi­able debate over dra­con­ian Inter­net leg­is­la­tion that may have seri­ous­ly lim­it­ed the poten­tial for this remark­able medi­um, sets this observ­er to won­der if he actu­al­ly was work­ing to gen­er­ate sym­pa­thy for SOPA. Per­haps oth­er inter­ests were manip­u­lat­ing Our Hero, run­ning him “on a leash.”
  • In the past, we’ve seen Nazi/fascist mon­ey man Carl Lund­strom financ­ing the Pirate Bay down­load site. He has also alleged­ly been involved in financ­ing a sec­ond free down­load site.
  • We’ve seen the Under­ground Reich engage in mon­ey-mak­ing crim­i­nal con­spir­a­cies rang­ing in size from the short-sell­ing that occurred before the assas­si­na­tion of Pres­i­dent Kennedy and the 9/11 attacks to the Great Train Rob­bery in Britain.
  • Is the Dot­com­man­dant actu­al­ly gen­er­at­ing mon­ey for the Bor­mann cap­i­tal net­work while dis­cred­it­ing advo­cates of Inter­net free­dom? Note the mon­ey laun­der­ing charges against Our Hero, as well as the shock­ing­ly light sen­tence imposed on him by the Ger­man courts.
  • The oth­er peo­ple involved with MegaU­pload are Ger­mans and peo­ple from areas that were occu­pied by the Nazis in WWII, such as Slo­va­kia. (Slo­va­kia was, like Croa­t­ia, a nom­i­nal­ly inde­pen­dent Nazi pup­pet state, con­trolled by the col­lab­o­ra­tionist Hlin­ka par­ty.)

Have Schmitz/Dotcom been but­tressed and fueled with Nazi ven­ture cap­i­tal, in exchange for part of the prof­its?

The view here is that MegaU­pload and Schmitz/Dotcom’s media antics will serve to dis­cred­it the cause of inter­net free­dom and may serve as pre­text for the big cor­po­ra­tions to crack down hard–and I mean hard–on inter­net free­dom.

That would be deeply trag­ic.

Pro­gram High­lights Include: The Dot­com­man­dan­t’s rare edi­tion of Mein Kampf, auto­graphed by Hitler him­self; The Dot­com­man­dan­t’s taste for Nazi mem­o­ra­bil­ia and war gear; The Dot­com­man­dan­t’s found­ing of an encrypt­ed e‑mail ser­vice, just as Ger­manya and Brazil were launch­ing tech­nol­o­gy projects sup­pos­ed­ly ini­ti­at­ed in the wake of the Snow­den dis­clo­sures; The Dot­com­man­dan­t’s ear­ly polit­i­cal out­reach to John Banks and the ACT Par­ty, a far-right New Zealand polit­i­cal cadre; review of the divine lais­sez faire eco­nom­ic doc­trine of The Fel­low­ship (also known as “The Fam­i­ly,” not to be con­fused with the mind con­trol cult which fig­ures in Julian Assange’s back­ground); com­par­i­son of the divine lais­sez faire doc­trine of the Fel­low­ship with that of the Mus­lim Broth­er­hood and its eco­nom­ic the­o­reti­cian Ibn Khal­dun; “ex” CIA offi­cer Gra­ham E. Fuller’s endorse­ment of Mus­lim free-mar­ket the­o­ry; the sim­i­lar­i­ty in the cor­po­ratism of the Mus­lim Broth­er­hood and that of the GOP.

1. Now, about the Dot­com­man­dant:

“The Fast, Fab­u­lous, Alleged­ly Fraud­u­lent Life of MegaU­ploads Kim Dotcom“by Sean Gal­lagher; Wired.com;  1/26/2012.

. . . . Schmitz’s efforts to branch into the “legit” world of secu­ri­ty con­sult­ing with his secu­ri­ty com­pa­ny Data Pro­tect ini­tial­ly back­fired by expos­ing his real identity—and by allow­ing it to be con­nect­ed to his hack­er cre­den­tials. In March of 1994, he was arrest­ed by police for traf­fick­ing in stolen phone call­ing card num­bers. He was held in cus­tody for a month, then arrest­ed again on addi­tion­al hack­ing charges short­ly after­ward — and again released. In 1998, he was con­vict­ed of 11 counts of com­put­er fraud, 10 counts of data espi­onage, and an assort­ment of oth­er charges. He received a two-year sus­pend­ed sentence—because, at just 20, he was declared “under age” at the time the crimes were com­mit­ted.

But Schmitz used the noto­ri­ety to boost his secu­ri­ty busi­ness. He soon land­ed a secu­ri­ty con­tract for Data Pro­tect with the air­line Lufthansa by demon­strat­ing an appar­ent secu­ri­ty vulnerability—though accord­ing to claims by oth­ers in the Ger­man hack­ing com­mu­ni­ty, his con­nec­tion to the air­line was thanks to col­lab­o­ra­tion with an insid­er there, and to the hack­ing skills of an accom­plice. . . . .

. . . . With insid­er trad­ing charges pend­ing over Lets­Buy­It, Schmitz decid­ed it was time to lay low (by his stan­dards); “in fear for his life,” he fled to Thai­land in Jan­u­ary of 2002. On his web­site, he hint­ed at pos­si­ble sui­cide, say­ing he would be cross­ing “to a new world,” Hale-Bopp cult style. But instead of off­ing him­self, he declared that he want­ed to be known as “King Kim­ble the First, Ruler of the Kim­pire” — a label he would apply to his future projects. (It’s list­ed as his title on LinkedIn.)

As it turned out, Thai­land wasn’t hap­py to see him. He was prompt­ly arrest­ed and fast-track deport­ed to Ger­many to stand tri­al. How­ev­er, the few nights in a Thai jail turned out to be the worst of it, as fears of prison in Ger­many were unfounded—he was sen­tenced to 20 months pro­ba­tion and slapped with a €100,000 fine. In 2003, he plead­ed guilty to embez­zle­ment charges over the Mon­key “loan” and received anoth­er two years of pro­ba­tion.

After the law’s repeat­ed lash­es with a wet noo­dle, Schmitz left Ger­many and moved to Hong Kong to start the next lev­el of Mega-insan­i­ty. . . .

2a. More about Our Hero:

“Who is Kim Dot­com? The Sto­ry Behind Megau­ploads Larg­er-than-Life-Founder” by Lin­coln Feast and Sarah Marsh; The Huff­in­g­ton Post; 1/21/2012.

. . . . But in 2002, he was con­vict­ed in what was then the largest insid­er-trad­ing case in Ger­man his­to­ry.

Pros­e­cu­tors said Schmitz bought shares in an online busi­ness and drove up the share price by announc­ing plans to invest mil­lions to res­cue the com­pa­ny from insol­ven­cy. After sell­ing his shares for a prof­it, he fled to Thai­land, was arrest­ed and deport­ed.

A Munich court sen­tenced the then 28-year-old to 20 months pro­ba­tion and a 100,000-euro fine.

After his con­vic­tion, Schmitz dis­ap­peared from pub­lic view, reap­pear­ing a cou­ple of years ago in New Zealand, hav­ing legal­ly changed his name to Dot­com. . . .

. . . . The FBI esti­mates that Dot­com per­son­al­ly made around $115,000 a day dur­ing 2010 from his empire. The list of prop­er­ty to be for­feit­ed, includ­ing almost 20 lux­u­ry cars, one of them a pink Cadil­lac, hints at a lav­ish lifestyle which may be about to be put on hold. . . .

2b. If you can find a way to con­vince your­self that Kim Dot­com is trust­wor­thy you might be able to use text search­able strong­ly enrypt­ed email ser­vices that even the gov­er­ment can’t read.

Mega to Fill Secure Email Gap Left by Lavabit” by Rob O’Neill; ZDNet; 8/11/2013.

Kim Dot­com’s “pri­va­cy com­pa­ny” Mega is devel­op­ing secure email ser­vices to run on its entire­ly non-US-based serv­er net­work as intense pres­sure from US author­i­ties forces oth­er providers to close.

Last week, Lavabit, which count­ed NSA leak­er Edward Snow­den as a user, closed and Silent Cir­cle closed its secure email ser­vice. Lavabit’s own­er, Ladar Lev­i­son, said he was shut­ting it down to avoid becom­ing “com­plic­it in crimes against the Amer­i­can peo­ple”.

Last week, Mega chief exec­u­tive Vikram Kumar told ZDNet that the com­pa­ny was being asked to deliv­er secure email and voice ser­vices. In the wake of the clo­sures, he expand­ed on his plans.

Kumar said work is in progress, build­ing off the end-to-end encryp­tion and con­tacts func­tion­al­i­ty already work­ing for doc­u­ments in Mega.

“The biggest tech hur­dle is pro­vid­ing email func­tion­al­i­ty that peo­ple expect, such as search­ing emails, that are triv­ial to pro­vide if emails are stored in plain text (or avail­able in plain text) on the serv­er side,” Kumar said.

“If all the serv­er can see is encrypt­ed text, as is the case with true end-to-end encryp­tion, then all the func­tion­al­i­ty has to be built client side. [That’s] not quite impos­si­ble, but very, very hard. That’s why even Silent Cir­cle did­n’t go there.”

A big issue is han­dling emails to and from non-encrypt­ed con­tacts when Mega’s core propo­si­tion is end-to-end encryp­tion, Kumar said.

“On this and oth­er fronts, Mega is doing some huge­ly cut­ting-edge stuff,” he said. “There is prob­a­bly no one in the world who takes the Mega approach of mak­ing true cryp­to work for the mass­es, our core propo­si­tion.”

Kumar said Mega is tak­ing the­o­ret­ic sound­ing tech­nol­o­gy such as Bloom fil­ters, and mak­ing them work for the mass­es. Work is also under way to keep Mega secure, even if SSL/TLS is com­pro­mised.

“[It’s] excit­ing stuff, but very hard, so I think it will take months more to crack it,” he said. “But Mega will nev­er launch any­thing that under­mines its end-to-end encryp­tion core secu­ri­ty propo­si­tion and does­n’t work for the myth­i­cal grand­moth­er.”

Mean­while, Kim Dot­com has said that he may have to pull parts of Mega out of New Zealand if new sur­veil­lance leg­is­la­tion is passed into law.

Dot­com told Tor­rent­F­reak that the US gov­ern­ment and the oth­er Five Eyes part­ners, the UK, Cana­da, Aus­tralia, and New Zealand, are push­ing new spy leg­is­la­tion to pro­vide back­doors into inter­net ser­vices.

“The NZ gov­ern­ment is cur­rent­ly aggres­sive­ly look­ing to extend its pow­ers with the GCSB [Gov­ern­ment Com­put­er Ser­vices Bureau] and the [Telecom­mu­ni­ca­tions Inter­cep­tion Capa­bil­i­ties] Act, which will force ser­vice providers with encryp­tion capa­bil­i­ties to give them secret decryp­tion access,” Dot­com said.

He added that it might force some relo­ca­tion of Mega’s net­work to oth­er juris­dic­tions, such as Ice­land.

Dot­com explained that by design, Mega does­n’t hold decryp­tion keys to cus­tomer accounts and “nev­er will”.

Lavabit’s Lev­i­son said: “This expe­ri­ence has taught me one very impor­tant les­son: With­out con­gres­sion­al action or a strong judi­cial prece­dent, I would — strong­ly — rec­om­mend against any­one trust­ing their pri­vate data to a com­pa­ny with phys­i­cal ties to the Unit­ed States.”


3. The Dot­com­man­dant pre­sides over a polit­i­cal par­ty in New Zealand that was poised to win seats in that coun­try’s par­lia­ment or even par­tic­i­pate in a coali­tion gov­ern­ment. The Dot­com­man­dant is propos­ing to end New Zealand’s par­tic­i­pa­tion in the Five Eyes spy­ing program–a major focal point of the appar­ent BND “op” exe­cut­ed by Edward Snow­den.

In Australia–like New Zealand, part of the Five Eyes arrange­ment–Dot­com­man­dant asso­ciate Julian Assange found­ed the Wik­iLeaks Par­ty. It also formed far-right and fas­cist alle­giances, while attract­ing atten­tion from the so-called pro­gres­sive sec­tor.

Note that the Dotkom­man­dant is being assist­ed by the major play­ers  in the Snow­den “op”: Nazi fel­low-trav­el­er Glenn Green­wald, Julian Assange and Eddie the Friend­ly Spook him­self.

“Online Rene­gade, Want­ed in U.S., Shakes Up New Zealand Elec­tion” by Jonathan Hutchin­son; The New York Times; 9/19/2014.

It was not an ordi­nary polit­i­cal ral­ly, but it has been any­thing but an ordi­nary elec­tion.

The hun­dreds of peo­ple who packed Auck­land Town Hall on a recent evening were regaled by speech­es by Glenn Green­wald, a Pulitzer Prize-win­ning jour­nal­ist; Julian Assange, the Wik­iLeaks founder; and Edward J. Snow­den, the for­mer Nation­al Secu­ri­ty Agency con­trac­tor, the last two appear­ing by Inter­net video link. Mr. Green­wald and Mr. Snow­den said the New Zealand gov­ern­ment had car­ried out, or at least par­tic­i­pat­ed in, mass domes­tic sur­veil­lance.

But at the cen­ter of the show was the event’s orga­niz­er, Kim Dot­com, an Inter­net entre­pre­neur accused of mass copy­right theft whose fledg­ling Inter­net Par­ty stands a chance at win­ning seats in Par­lia­ment in the nation­al elec­tions on Sat­ur­day.

“We are going to work real­ly, real­ly hard to stop this coun­try from par­tic­i­pat­ing in mass sur­veil­lance,” Mr. Dot­com told the crowd. “And we’ll close one of the Five Eyes,” he added, refer­ring to the intel­li­gence alliance that con­sists of Aus­tralia, Britain, Cana­da, New Zealand and the Unit­ed States. The crowd erupt­ed in cheers. . . .

. . . . The par­ty advo­cates . . . . repeal­ing sur­veil­lance leg­is­la­tion and amend­ing copy­right laws to pro­tect Inter­net com­pa­nies from “civ­il lia­bil­i­ty aris­ing from the action of their users,” a fix that could shield host­ing ser­vices like Mega.

There is wide­spread sus­pi­cion, as well, that if his par­ty wins a place in the gov­ern­ment, it will try to block his extra­di­tion. . .

. . . Mr. Dot­com has sunk at least 3.5 mil­lion New Zealand dol­lars, or $2.9 mil­lion, into the Inter­net Par­ty, the largest per­son­al con­tri­bu­tion to a polit­i­cal par­ty on record in New Zealand, accord­ing to the nation­al Elec­toral Com­mis­sion. . . .

4a. Our Hero–now a denizen of the so-called pro­gres­sive sector–originally sought out, and con­tributed mon­ey to, the far right ACT par­ty head John Banks when beat­ing the polit­i­cal bush in New Zealand.

Chris Bar­ton: Get back to Your Roots Kim Dot­com” by Chris Bar­ton; The New Zealand Her­ald; 2/4/2014.

Watch­ing Kim Dotcom’s slow strip reveal­ing his Inter­net Par­ty plans has been excru­ci­at­ing: the leak to Wha­le­oil, the can­cel­la­tion of the extrav­a­ganza launch par­ty, the com­pro­mise of jour­nal­is­tic inde­pen­dence by unmasked par­ty sec­re­tary Alas­tair Thomp­son, and his sub­se­quent res­ig­na­tion. As a polit­i­cal par­ty launch, this wasn’t a fias­co, it was a train wreck. . . .

. . . . It is weird, how­ever, that the left has tak­en up with Dot­com. The left is not his nat­ural home. When he first came to New Zealand, he sought out the far right in the shape of John Banks for assis­tance. He’s clear­ly pro tax min­imi­sa­tion for busi­nesses — evi­denced by his set­ting up Megau­pload in Hong Kong where it was on a 4 per cent tax rate. It’s also plain to see he’s a busi­ness­man who likes to make obscene amounts of mon­ey, flaunt his wealth with extrav­a­gant spend­ing and have ser­vants respond­ing to his beck and call — hard­ly the hall­mark of a left-winger.

4b. More about the rela­tion­ship between Kim Dot­com and the ACT Par­ty’s John Banks. 

“NZ Min­is­ter Resigns Over Kim Dot­com Dona­tion Alle­ga­tions” [Bloomberg]; The Guardian [UK]; 10/16/2014.  

A cam­paign dona­tion by inter­net entre­pre­neur and alleged copy­right pirate Kim Dot­com has forced the res­ig­na­tion of a New Zealand gov­ern­ment min­is­ter.

John Banks resigned on Wednes­day as min­is­ter for reg­u­la­to­ry reform and small busi­ness after the Auck­land dis­trict court ordered him to stand tri­al over alle­ga­tions of elec­toral fraud relat­ing to Dotcom’s NZ$50,000 ($44,144) dona­tion.

Banks is accused of know­ing­ly fil­ing a false elec­tion return in his failed 2010 Auck­land may­oral bid, list­ing dona­tions from Dot­com and casi­no oper­a­tor SkyC­i­ty Enter­tain­ment Group Ltd as anony­mous when he knew who they were from – an offence under the Elec­toral Act. . . . .

4c. Our Hero has a rare copy of Mein Kampf, per­son­al­ly auto­graphed by Hitler.

“Kim Dot­com Launched His Polit­i­cal Par­ty” by Vic­to­ria Turk; Moth­er­board.Vice.com; 3/27/2014.

. . . Before the par­ty even launched, he’s been embroiled in polit­i­cal ten­sions. He ini­tially planned a free “Par­ty par­ty” to kick off the polit­i­cal ven­ture, but was forced to can­cel when the Elec­toral Com­mis­sion warned it could be seen as buy­ing votes. Then accord­ing to local news sites, he’s been in the awk­ward posi­tion this week of hav­ing to defend own­ing Nazi mem­o­ra­bilia includ­ing a signed copy of Hitler’s Mein Kampf . . . . 

6. The Dot­com­man­dan­t’s par­ty tanked in the elec­tions. Inter­est­ing­ly, some observers felt that it was the Dot­com­man­dant him­self who doomed the par­ty’s chances, as well as that of oth­er so-called pro­gres­sive polit­i­cal par­ties. Was that the intent? Recall that the Aus­tralian Wik­iLeaks Par­ty also grav­i­tat­ed to far-right and fas­cist ele­ments, dam­ag­ing the Greens in the process.

“New Zealand’s Rul­ing Nation­al Par­ty Is Re-Elect­ed” by Jonathan Hutchin­son; The New York Times; 9/21/2014.

. . . . The Inter­net Mana par­ty — a polit­i­cal alliance that includes the Inter­net Par­ty, found­ed and bankrolled by Kim Dot­com, the Ger­man entre­pre­neur accused of wide­spread Inter­net pira­cy — failed to win a seat in Par­lia­ment. Its main can­di­date, Hone Harawira, lost his local race, and Inter­net Mana’s 1.26 per­cent of the par­ty vote fell well short of the 5 per­cent need­ed.

The Inter­net Par­ty leader, Laila Har­ré, blamed the Nation­al Par­ty for under­min­ing Mr. Harawira’s sup­port, but Mr. Dot­com dis­agreed.

“I take full respon­si­bil­i­ty for this loss tonight, because the brand — the brand Kim Dot­com — was poi­son for what we were try­ing to achieve,” he told reporters. “I did not see that before, and it only became appar­ent to me in the last cou­ple of weeks.” Mr. Dot­com put at least $2.9 mil­lion into the Inter­net Par­ty since May 26, accord­ing to Elec­toral Com­mis­sion records.

A co-leader of the Green Par­ty, Rus­sel Nor­man, said Mr. Dotcom’s pres­ence in the elec­tion had tar­nished left-lean­ing par­ties like his. The Green Par­ty won just 10 per­cent of the vote, down from 11 per­cent in 2011.

“I did say that to Kim Dot­com,” he said. “Remem­ber, I did say a long time ago that it was a bad idea. But any­way, there you go.”


7. More about John Banks and his ACT Par­ty:

“John Banks Does It Again”; OTAGosh; 8/20/2012.

He has a glow­ing resume in the world of Kiwi pol­i­tics. Well, glow­ing may over­state it; his rep­u­ta­tion has been well and tru­ly tar­nished by con­tro­ver­sy over the years. John Banks was a min­is­ter in a pre­vi­ous Nation­al gov­ern­ment and then, for a time, may­or of Auck­land. These days he’s the sole rep­re­sen­ta­tive in New Zealand’s par­lia­ment for the far right Act Par­ty, and in a for­mal coali­tion with his for­mer Nation­al Par­ty bud­dies.

Life just keeps turn­ing up ros­es for John. The man who was turfed out of par­lia­ment once before by vot­ers, then lost the may­oral­ty, was thrown a sop for his sin­gle one-man-band vote, a juicy cab­i­net posi­tion. Described (jok­ing­ly?) as “bare­ly lit­er­ate” by a radio com­men­ta­tor, Mr Banks once again pulls in a hand­some salary, this time not as a fringe radio talk-back host, but as asso­ciate Edu­ca­tion Min­is­ter. . . .

. . . . Banks is report­ed in the NZ Her­ald as declar­ing “he believes the Gen­e­sis account of the start of life on Earth,” telling Radio Rhe­ma he has “no doubts the first chap­ters of Gen­e­sis are true.” “God made the world in six days, with Adam and Eve his last act of cre­ation.” . . .

8. More about the ide­ol­o­gy of the ACT Par­ty:

“ACT New Zealand;” Wikipedia.com

ACT New Zealand is a free mar­ket polit­i­cal par­ty in New Zealand. The par­ty’s cur­rent leader is Jamie Whyte. Until the 2011 New Zealand gen­er­al elec­tion it was led by for­mer Nation­al Par­ty leader and Reserve Bank Gov­er­nor Don Brash.

Accord­ing to for­mer par­ty leader Rod­ney Hide, the par­ty stands for “indi­vid­ual free­dom, per­son­al respon­si­bil­i­ty, doing the best for our nat­ur­al envi­ron­ment and for small­er, smarter gov­ern­ment in its goals of a pros­per­ous econ­o­my, a strong soci­ety, and a qual­i­ty of life that is the envy of the world”.[1]

The name comes from the ini­tials of the Asso­ci­a­tion of Con­sumers and Tax­pay­ers, found­ed in 1993 by Roger Dou­glas and Derek Quigley, from which the par­ty grew in 1994. The par­ty is com­mon­ly known by the acronym “ACT” and pro­nounced as a word rather than as ini­tials. . . .

9. Through­out the course of the “Arab Spring,” we not­ed that it was not a spon­ta­neous event, but a covert oper­a­tion, tap­ping the deserved­ly right­eous frus­tra­tion of many of the peo­ples in that region in order to ush­er the Islamo-fas­cist Mus­lim Broth­er­hood into pow­er. The “turn to the Broth­er­hood” took place dur­ing the sec­ond admin­is­tra­tion of George W. Bush and has con­tin­ued under Oba­ma.

(Trag­i­cal­ly, one of the most impor­tant devel­op­ments in the inves­ti­ga­tion into 9/11–the Oper­a­tion Green Quest raids of 3/20/2002–has been over­looked. That inves­ti­ga­tion revealed pro­found oper­a­tional links between the GOP and its chief “pri­va­ti­za­tion” ide­o­logues (Grover Norquist and Karl Rove) and the Mus­lim Broth­er­hood, includ­ing ele­ments and indi­vid­u­als involved in financ­ing al-Qae­da. It stands as a resound­ing indict­ment of this coun­try’s cit­i­zen­ry, jour­nal­is­tic estab­lish­ment and polit­i­cal class that the Unit­ed States con­tin­ues to suf­fer under the “aus­ter­i­ty” onslaught man­i­fest­ed as “the sequester.” The core of the GOP polit­i­cal axis–Norquist and Rove–should  be await­ing tri­al at Guan­tanamo as the trai­tors they in point of fact are. The utter­ly gut­less jour­nal­ists and politi­cos deserve the blame for this fail­ure.)

Ulti­mate­ly, Oba­ma and/or the Demo­c­ra­t­ic Par­ty will take the heat for the actions ini­ti­at­ed by Bush, Rove and Norquist.

There is every indi­ca­tion that pow­er­ful, transna­tion­al cor­po­rate forces envi­sioned and then dic­tat­ed the “turn to the Broth­er­hood.”

The World Bank overt­ly endorsed the eco­nom­ic agen­da of the Broth­er­hood, see­ing in their “cor­po­ratist” ide­ol­o­gy a blue­print for advanc­ing free-mar­ket ide­ol­o­gy in the Mus­lim world.

When the World Bank gives voice to such think­ing, the mes­sage res­onates pow­er­ful­ly in the cor­ri­dors of eco­nom­ic pow­er. (We note in pass­ing that the arti­cle detail­ing the Broth­er­hood’s free-mar­ket prin­ci­ples appeared in Newsweek, part of the Gra­ham pub­lish­ing empire at the time. The Gra­ham pub­lish­ing inter­ests are sec­ond only to The New York Times as a “voice” the Amer­i­can estab­lish­ment.)

Note­wor­thy in this con­text is the sim­i­lar­i­ty in the IMF’s inter­pre­ta­tion of “Islam­ic free-mar­ket” prin­ci­ples and the “Chris­t­ian free-mar­ket” ide­ol­o­gy espoused by the pow­er­ful group known as “The Fam­i­ly” or The Fel­low­ship.” (They are not to be con­fused with the San­tikene­tan Park Asso­ci­a­tion dis­cussed in FTR #724.)

Bor­row­ing a page from the Calvin­ist book, The Fam­i­ly sees great suc­cess in busi­ness as proof of God’s bless­ing on the suc­cess­ful.

Both the Mus­lim Broth­er­hood and The Fam­i­ly see free-mar­ket/lais­sez-faire prin­ci­ples as being divine in nature, ordained by the Cre­ator.

Of course both the Broth­er­hood and The Fam­i­ly are strong­ly con­nect­ed to the Under­ground Reich.

We note that “ex” CIA offi­cer Gra­ham Fuller, one of the archi­tects of the “turn to the Broth­er­hood,” as we call it, artic­u­lat­ed the attrac­tion of Islam for West­ern conservatives/corporatists.

“Elite Fun­da­men­tal­ism — The Fel­low­ship’s Gospel of Cap­i­tal­ist Pow­er”;  Reli­gion Report [Aus­tralian Broad­cast Com­pa­ny]; 9/3/2008.

Stephen Crit­ten­den: Now the book is basi­cally about a shad­owy organ­i­sa­tion called The Fam­ily, or The Fel­low­ship that was found­ed by a guy called Abra­ham Verei­de, a Nor­we­gian immi­grant to the Unit­ed States in the 1930s. Tell us about him and the foun­da­tion of this organ­i­sa­tion.

Jeff Sharlet: Verei­de is a fas­ci­nat­ing char­ac­ter. This guy who comes to Amer­ica from Nor­way, because he sees America’s the land of the Bible unchained. Even from a boy he’s giv­en to what he thinks are prophet­ic visions. He believes that God comes to him and talks to him in very lit­eral words. He comes to Amer­ica and he makes quite a name for him­self, becomes a preach­er and starts preach­ing to guys like Hen­ry Ford and titans of the steel indus­try and so on, and then has this Epiphany, this real­i­sa­tion in the mid­dle of our Great Depres­sion in the 1930s. He decides that the Great Depres­sion is actu­ally a pun­ish­ment from God for dis­obey­ing God’s law, and how are we dis­obey­ing God’s law? Well it’s because we are try­ing to reg­u­late the econ­omy, we are try­ing to take mat­ters into our own hands. Well we just have to com­pletely trust God, and those he choos­es, men like Hen­ry Ford and the CEO of US Steel and so on.

Stephen Crit­ten­den: Yes, it’s a mus­cu­lar Chris­tian­ity. You’d almost say he had a min­istry to bring that indus­trial class back into reli­gion.

Jeff Sharlet: Absolute­ly. This must be a Chris­tian­ity on steroids. They were build­ing on this tra­di­tion of this kind of macho Christ, and tak­ing it to these busi­ness­men who didn’t real­ly care about church or the Bible or any­thing like that. What they cared about was organ­ised labour, and in fact, par­tic­u­larly in Aus­tralia. Har­ry Bridges was a major, major labour leader here in the Unit­ed States. And they just saw him the Dev­il Incar­nate, and began to organ­ise against him. And that’s what this group has become — and are to this day. They still see God’s inter­ests as those of the absolute­ly unreg­u­lated free mar­kets — a very sort of macho, mus­cu­lar Chris­tian­ity that tends to serve the inter­ests of those involved. . . .

10. About the Mus­lim Broth­er­hood’s eco­nom­ic doc­trine. com­pare this with the eco­nom­ic ide­ol­o­gy of The Fel­low­ship of Abra­ham Verei­de.

“Islam in Office” by Stephen Glain; Newsweek; 7/3–10/2006.

Judeo-Chris­t­ian scrip­ture offers lit­tle eco­nomic instruc­tion. The Book of Deuteron­omy, for exam­ple, is loaded with edicts on how the faith­ful should pray, eat, bequeath, keep the holy fes­ti­vals and treat slaves and spous­es, but it is silent on trade and com­merce. In Matthew, when Christ admon­ishes his fol­low­ers to ‘give to the emper­or the things that are the emperor’s,’ he is effec­tively con­ced­ing fis­cal and mon­e­tary author­ity to pagan Rome. Islam is dif­fer­ent. The prophet Muhammad—himself a trader—preached mer­chant hon­or, the only reg­u­la­tion that the bor­der­less Lev­an­tine mar­ket knew. . . .

. . . In Mus­lim litur­gy, the deals cut in the souk become a metaphor for the con­tract between God and the faith­ful. And the busi­ness mod­el Muham­mad pre­scribed, accord­ing to Mus­lim schol­ars and econ­o­mists, is very much in the lais­sez-faire tra­di­tion lat­er embraced by the West. Prices were to be set by God alone—anticipating by more than a mil­len­nium Adam Smith’s ref­er­ence to the ‘invis­i­ble hand’ of mar­ket-based pric­ing. Mer­chants were not to cut deals out­side the souk, an ear­ly attempt to thwart insid­er trad­ing. . . . In the days of the caliphate, Islam devel­oped the most sophis­ti­cated mon­e­tary sys­tem the world had yet known. Today, some econ­o­mists cite Islam­ic bank­ing as fur­ther evi­dence of an intrin­sic Islam­ic prag­ma­tism. Though still guid­ed by a Qur’anic ban on riba, or inter­est, Islam­ic bank­ing has adapt­ed to the needs of a boom­ing oil region for liq­uid­ity. In recent years, some 500 Islam­ic banks and invest­ment firms hold­ing $2 tril­lion in assets have emerged in the Gulf States, with more in Islam­ic com­mu­ni­ties of the West.

British Chan­cel­lor of the Exche­quer Gor­don Brown wants to make Lon­don a glob­al cen­ter for Islam­ic finance—and elic­its no howl of protest from fun­da­men­tal­ists. How Islamists might run a cen­tral bank is more prob­lem­atic: schol­ars say they would manip­u­late cur­rency reserves, not inter­est rates.

The Mus­lim Broth­er­hood hails 14th cen­tury philoso­pher Ibn Khal­dun as its eco­nomic guide. Antic­i­pat­ing sup­ply-side eco­nom­ics, Khal­dun argued that cut­ting tax­es rais­es pro­duc­tion and tax rev­enues, and that state con­trol should be lim­ited to pro­vid­ing water, fire and free graz­ing land, the util­i­ties of the ancient world. The World Bank has called Ibn Khal­dun the first advo­cate of pri­va­ti­za­tion. [Empha­sis added.] His found­ing influ­ence is a sign of mod­er­a­tion. If Islamists in pow­er ever do clash with the West, it won’t be over com­merce. . . .

11. In addi­tion to the appar­ent use of Mus­lim Brotherhood/Islamist ele­ments as proxy war­riors against Rus­sia and Chi­na,the Brotherhood’s cor­po­ratist eco­nom­ics are beloved to Gra­ham Fuller, as well as cor­po­rate ele­ments cdham­pi­oned by Grover Norquist.

“Chech­nyan Pow­er” by Mark Ames; nsfwcorp.com; 6/5/2013.

. . . . Fuller comes from that fac­tion of CIA Cold War­riors who believed (and still appar­ently believe) that fun­da­men­tal­ist Islam, even in its rad­i­cal jiha­di form, does not pose a threat to the West, for the sim­ple rea­son that fun­da­men­tal­ist Islam is con­ser­v­a­tive, against social jus­tice, against social­ism and redis­tri­b­u­tion of wealth, and in favor of hier­ar­chi­cal socio-eco­nom­ic struc­tures. Social­ism is the com­mon ene­my to both cap­i­tal­ist Amer­ica and to Wah­habi Islam, accord­ing to Fuller.

Accord­ing to jour­nal­ist Robert Drey­fuss’ book “Devil’s Game,” Fuller explained his attrac­tion to rad­i­cal Islam in neoliberal/libertarian terms:

“There is no main­stream Islam­ic organization...with rad­i­cal social views,” he wrote. “Clas­si­cal Islam­ic the­ory envis­ages the role of the state as lim­ited to facil­i­tat­ing the well-being of mar­kets and mer­chants rather than con­trol­ling them. Islamists have always pow­er­fully object­ed to social­ism and communism....Islam has nev­er had prob­lems with the idea that wealth is uneven­ly dis­trib­uted.” . . . .

12. More about the cor­po­ratist eco­nom­ic phi­los­o­phy of the Mus­lim Broth­er­hood fol­lows. Note that Khairat el-Shater was alleged by Egypt­ian intel­li­gence to have been run­ning Mohamed Mor­si. (We cov­ered this in FTR #787.) In turn, he was report­ed to be serv­ing as a liai­son between Mor­si and Mohamed Zawahiri, the broth­er of Al-Qae­da leader Ayman Zawahiri. Shater was also net­worked with: Anne Pat­ter­son, U.S. ambas­sador to Egypt, GOP Sen­a­tor John McCain and GOP Sen­a­tor Lid­say Gra­ham. In turn, Shater was alleged to have trans­ferred $50 mil­lion from the Egypt­ian Mus­lim Broth­er­hood to Al-Qae­da at the time that he was net­work­ing with the Amer­i­cans and Mor­si. Hey, what’s $50 mil­lion between friends.

“The GOP Broth­er­hood of Egypt” by Avi Ash­er-Schapiro; Salon.com; 1/25/2012.

While West­ern alarmists often depict Egypt’s Mus­lim Broth­er­hood as a shad­owy orga­ni­za­tion with ter­ror­ist ties, the Brotherhood’s ide­ol­o­gy actu­al­ly has more in com­mon with America’s Repub­li­can Par­ty than with al-Qai­da. Few Amer­i­cans know it but the Broth­er­hood is a free-mar­ket par­ty led by wealthy busi­ness­men whose eco­nom­ic agen­da embraces pri­va­ti­za­tion and for­eign invest­ment while spurn­ing labor unions and the redis­tri­b­u­tion of wealth. Like the Repub­li­cans in the U.S., the finan­cial inter­ests of the party’s lead­er­ship of busi­ness­men and pro­fes­sion­als diverge sharply from those of its poor, social­ly con­ser­v­a­tive fol­low­ers.

The Broth­er­hood, which did not ini­tial­ly sup­port the rev­o­lu­tion that began a year ago, reaped its ben­e­fits, cap­tur­ing near­ly half the seats in the new par­lia­ment, which was seat­ed this week, and vault­ing its top lead­ers into posi­tions of pow­er.

Arguably the most pow­er­ful man in the Mus­lim Broth­er­hood is Khairat Al-Shater, a mul­ti­mil­lion­aire tycoon whose finan­cial inter­ests extend into elec­tron­ics, man­u­fac­tur­ing and retail. A strong advo­cate of pri­va­ti­za­tion, Al-Shater is one of a cadre of Mus­lim Broth­er­hood busi­ness­men who helped finance the Brotherhood’s Free­dom and Jus­tice Party’s impres­sive elec­toral vic­to­ry this win­ter and is now craft­ing the FJP’s eco­nom­ic agen­da.

At Al-Shater’s lux­u­ry fur­ni­ture out­let Istak­bal, a new couch costs about 6,000 Egypt­ian pounds, about $1,000 in U.S. cur­ren­cy. In a coun­try where 40 per­cent of the pop­u­la­tion lives on less than $2 a day, Istakbal’s clien­tele is large­ly lim­it­ed to Egypt’s upper class­es.

Although the Broth­ers do draw sig­nif­i­cant sup­port from Egypt’s poor and work­ing class, “the Broth­er­hood is a firm­ly upper-mid­dle-class orga­ni­za­tion in its lead­er­ship,” says Sha­di Hamid, a lead­ing Mus­lim Broth­er­hood expert at the Brook­ings Insti­tu­tion in Wash­ing­ton.

Not sur­pris­ing­ly, these well-to-do Egyp­tians are eager to safe­guard their eco­nom­ic posi­tion in the post-Mubarak Egypt. Despite ris­ing eco­nom­ic inequal­i­ty and pover­ty, the Broth­er­hood does not back rad­i­cal changes in Egypt’s econ­o­my.

The FJP’s eco­nom­ic plat­form is a tame doc­u­ment, rife with promis­es to root out cor­rup­tion and tweak Egypt’s tax and sub­si­dies sys­tems, with occa­sion­al allu­sions to an unspe­cif­ic com­mit­ment to “social jus­tice.” The plat­form prais­es the mech­a­nisms of the free mar­ket and promis­es that the par­ty will work for “bal­anced, sus­tain­able and com­pre­hen­sive eco­nom­ic devel­op­ment.” It is a pro­gram that any Euro­pean con­ser­v­a­tive par­ty could get behind. . . .




2 comments for “FTR #812 Kim Dotcom and Divine Laissez Faire Economics”

  1. Cit­i­zen­four at 1:10:57 you’ll find an inter­est­ing note

    Posted by Mobius | March 5, 2015, 10:23 am
  2. @MOBIUS–

    For those of us who haven’t seen and/or won’t see the film, per­haps you would be kind enough to fill us in on the enig­mat­ic alle­ga­tion you have cit­ed.


    Dave Emory

    Posted by Dave Emory | March 5, 2015, 5:37 pm

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