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Thursday 12 February 2009

Unemployment Benefits in the UK

 

Minister: I couldn't live on benefits

By Nigel Morris, Deputy Political Editor

The Independent

The Employment minister Tony McNulty has admitted that he could not survive on the basic unemployment benefit paid to people made redundant. As dole queues surged to a 10-year high of 1.97 million, he acknowledged that it was "very, very difficult" to exist on jobseekers' allowance (JSA).
The benefit is worth £60.50 a week for people aged 25 and over and £47.95 a week for younger claimants.


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Tuesday 10 February 2009

Just what exactly do you stand for, Hazel Blears - except election?


 

The minister claims to have political guts, but the only principle her voting record shows is slavish obedience

An open letter to Hazel Blears MP, secretary of state for communities and local government.

 
Last week you used an article in the Guardian to attack my "cynical and corrosive commentary". You asserted your political courage, maintaining that "you don't get very far in politics without guts, and certainly not as far as the cabinet table". By contrast, you suggested, I contribute "to the very cynicism and disengagement from politics" that I make my living writing about. You accused me of making claims without supporting evidence and of "wielding great influence without accountability". "We need more people standing for office and serving their communities," you wrote, "more people debating, engaging and voting; not more people waving placards on the sidelines."
 
Quite so. But being the placard-waving sort, I have a cynical and corrosive tendency to mistrust the claims ministers make about themselves. Like you, I believe opinions should be based on evidence. So I have decided to test your statements against the record.
 
Courage in politics is measured by the consistent application of principles. The website TheyWorkForYou.com records votes on key issues since 2001. It reveals that you voted "very strongly for the Iraq war", "very strongly against an investigation into the Iraq war" and "very strongly for replacing Trident" ("very strongly" means an unbroken record). You have voted in favour of detaining terror suspects without charge for 42 days, in favour of identity cards and in favour of a long series of bills curtailing the freedom to protest. There's certainly consistency here, though it is not clear what principles you are defending.
 
Other threads are harder to follow. In 2003, for instance, you voted against a fully elected House of Lords and in favour of a chamber of appointed peers. In 2007, you voted for a fully elected House of Lords. You have served without public complaint in a government which has introduced the minimum wage but blocked employment rights for temporary and agency workers; which talked of fiscal prudence but deregulated the financial markets; which passed the Climate Change Act but approved the construction of a third runway at Heathrow; which spoke of an ethical foreign policy but launched an illegal war in which perhaps a million people have died. Either your principles, by some remarkable twists of fate, happen to have pre-empted every contradictory decision this government has taken, or you don't possess any.
 
You remained silent while the government endorsed the kidnap and the torture of innocent people; blocked a ceasefire in Lebanon and backed a dictator in Uzbekistan who boils his prisoners to death. You voiced no public concern while it instructed the Serious Fraud Office to drop the corruption case against BAE, announced a policy of pre-emptive nuclear war, signed a one-sided extradition treaty with the United States and left our citizens to languish in Guantánamo Bay. You remained loyal while it oversaw the stealthy privatisation of our public services and the collapse of Britain's social housing programme, closed hundreds of post offices and shifted taxation from the rich to the poor. What exactly do you stand for Hazel, except election?
 
The only consistent political principle I can deduce from these positions is slavish obedience to your masters. TheyWorkForYou sums up your political record thus: "Never rebels against their party in this parliament." Yours, Hazel, is the courage of the sycophant, the courage to say yes.
 
Let me remind you just how far your political "guts" have carried you. You are temporarily protected by the fact that the United Kingdom, unlike other states, has not yet incorporated the Nuremberg principles into national law. If a future government does so, you and all those who remained in the cabinet on 20 March 2003 will be at risk of prosecution for what the Nuremberg tribunal called "the supreme international crime". This is defined as the "planning, preparation, initiation or waging of a war of aggression". Robin Cook, a man of genuine political courage, put his conscience ahead of his career and resigned. What did you do?
 
It seems to me that someone of your principles would fit comfortably into almost any government. All regimes require people like you, who seem to be prepared to obey orders without question. Unwavering obedience guarantees success in any administration. It also guarantees collaboration in every atrocity in which a government might engage. The greatest thing we have to fear in politics is the cowardice of politicians.
 
You demanded evidence that consultations and citizens' juries have been rigged. You've got it. In 2007, the high court ruled that the government's first consultation on nuclear power was "seriously flawed" and "unlawful". It also ruled that the government must commission an opinion poll. The poll the government launched was reviewed by the Market Research Standards Board. It found that "information was inaccurately or misleadingly presented, or was imbalanced, which gave rise to a material risk of respondents being led towards a particular answer".
 
As freedom of information requests made by Greenpeace reveal, the consultation over the third runway at Heathrow used faked noise and pollution figures. It was repeatedly pre-empted by ministers announcing that the runway would be built. Nor did the government leave anything to chance when it wanted to set up giant health centres, or polyclinics, run by GPs. As Dr Tony Stanton of the Londonwide Local Medical Committees has pointed out, "a week before a £1m consultation on polyclinics and hospitals by NHS London closed, London's 31 primary care trusts were issued with instructions on setting up polyclinic pilots and GP-led health centres". Consultations elsewhere claimed that there was no need to discuss whether or not new health centres were required, as the principle had already been established through "extensive national level consultation exercises". But no such exercises had taken place; just a handful of citizens' juries engaging a total of a thousand selected people and steered by government ministers. Those who weren't chosen had no say.
 
Fixes like this might give you some clues about why more people are not taking part in politics. I believe there is a vast public appetite for re-engagement, but your government, aware of the electoral consequences, has shut us out. It has reneged on its promise to hold a referendum on electoral reform. It has blocked a referendum on the European treaty, ditched the regional assemblies, used Scottish MPs to swing English votes, sustained an unelected House of Lords, eliminated almost all the differences between itself and the opposition. You create an impenetrable political monoculture, then moan that people don't engage in politics.
 
It is precisely because I can picture something better that I have become such a cynical old git. William Hazlitt remarked that: "Man is the only animal that laughs and weeps; for he is the only animal that is struck with the difference between what things are and what they ought to be." You, Hazel, have helped to reduce our political choices to a single question: whether to laugh through our tears or weep through our laughter.


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Monday 9 February 2009

Now is the time for a revolution in economic thought


 

 
In my column last Thursday, I explained how academic economics has been discredited by recent events. It is now time for what historians of science call a "paradigm shift". If we want to flatter economists, we could compare this revolution needed to the paradigm shift in physics in 1910 after Einstein discovered relativity and Planck launched quantum mechanics. More realistically, economics today is where astronomy was in the 16th century, when Copernicus and Galileo had proved the heliocentric model, but religious orthodoxy and academic vested interests fought ruthlessly to defend the principle that the sun must revolve around the Earth.
 
In this article I will outline some of the unorthodox approaches to economics which conventional economists have ignored and which might have helped to avert the present crisis — in the weeks ahead I plan to give more detail of some of these ideas.
Consider the following passage:
 
"Most economic theorists have been going down the wrong track. When economic models fail, they are seldom thrown away. Rather they are 'fixed' - amended, qualified, particularised, expanded and complicated.
 
"Bit by bit, from a bad seed a big but sickly tree is built with glue, nails, screws and scaffolding. Conventional economics assumes the financial system is a linear, continuous, rational machine and these false assumptions are built into the risk models used by many of the world's banks. As a result, the odds of financial ruin in a free global market economy have been grossly underestimated. By using such methods there is no limit to how bad a bank's losses can get. Its own bankruptcy is the least of the worries; it will default on its obligations to other banks - and so the losses will spread from one inter-linked financial house to another. Only forceful action by regulators to put a firewall round the sickest firms will stop the crisis spreading. But bad news tends to come in flocks and a bank that weathers one crisis may not survive a second or a third."
 
This uncannily precise description of the present crisis above was not written by an economist. While some economists had warned for years about global trade imbalances, escalating house prices, of excessive consumer borrowing, none of them remotely foresaw the truly unprecedented feature of the present crisis: the total breakdown of financial markets caused by the unforced blunders by investors and banks. Modern economists were inherently incapable of understanding such a problem because they assumed that investors were "rational" and markets "efficient".
 
These assumptions led inevitably to disaster once they were blown apart. The author who came so close to understanding the true causes of the present crisis was not an economist but a mathematician.
 
Benoît Mandelbrot, a towering figure of 20th-century science, who invented fractal geometry and pioneered the mathematical analysis of chaos and complex systems, wrote the above words six years ago in his book The Misbehaviour of Markets. Mandelbrot's ideas found fruitful applications in the study of earthquakes, weather, galaxies and biological systems from the 1960s onward, but the field that originally inspired his ideas turns out, in this very readable book, to have been finance and economics. Yet 40 years of effort by Mandelbrot to interest economists in the new mathematical methods, which appear to work far better in modelling extreme movements in financial markets than the conventional methods based on statistically "normal" distributions, have been either ridiculed or ignored.
 
At the other end of the academic spectrum, we find economists treating ideas from sociology, psychology or philosophy with the same derision and disdain. George Soros is no mathematician like Mandelbrot, but he has repeatedly demonstrated far better understanding of how market economies work than any professional economist by using psychological and philosophical ideas. His books have explained convincingly how false beliefs among investors can create self-reinforcing boom-bust cycles of exactly the kind afflicting the world today. But the reaction to these ideas has been the same as to Mandelbrot's: a complacent refusal among academic economists, regulators and central bankers even to think seriously about approaches that challenge the central orthodoxies of modern economics: that "efficient" markets inhabited by "rational" investors send price signals which, in some sense, are always right.
Reality is very different, as everyone now admits: investors often misinterpret information and markets sometimes send price signals that are dangerously wrong. What Soros shows, moreover, is that such behaviour should not be regarded as irrational or an aberration. On the contrary, rational investors can find it very profitable to act on false premises - for example that credit will always be available without limit - if these false ideas become so widely accepted that they change the way the economy actually functions, at least for a time.
 
One reason why such fruitful insights have been ignored is the convention adopted by academic economists some 30 years ago that all serious ideas must be expressed in equations, not words. By this weird standard, the intellectual giants of the subject — Adam Smith, Ricardo, Keynes, Hayek — would not now be recognised as serious economists at all.
 
But even if we accept the mathematical formalism of modern economics, there is vast scope for new ideas.
 
A control theory approach, used by serious mathematicians such as Nicos Christofides and Shahid Chaudhri, working at the Centre for Quantitative Finance at London's Imperial College, has applied advanced mathematics from aerodynamics and control engineering to analyse financial turbulence without the over-simplified assumptions, such as continuous liquidity, which have caused the recent disasters in risk management and regulation.
 
But the challenge that existing economic orthodoxy may find most disconcerting is Imperfect Knowledge Economics (IKE), the name of a path-breaking recent book by Roman Frydman and Michael Goldberg, two American economists. Building on ideas of Edmund Phelps, one of the few Nobel Laureate economists who rejected the consensus view on rational expectations, IKE uses similar tools to conventional economics to generate radically different results. It insists that the future is inherently unknowable and therefore that there is always a multitude of plausible models of the way the economy works.
With this obvious, but critically important, change in assumptions, IKE demolishes most of the conclusions of rational expectations. More importantly, it shows that reasonable assumptions about economic uncertainty can produce financial models that give less spurious accuracy than the rational expectations models but are statistically far closer to what happens in the real world.
 
These are just a few examples of the creative thinking that has started again in economics after 20 years of stagnation. But the academic establishment, discredited though it is by the present crisis, will fight hard against new ideas. The outcome of this battle does not just matter to academic economists. Without a better understanding of economics, financial crises will keep recurring and faith in capitalism and free markets will surely erode. Changes in regulation are not sufficient after this financial crisis — it is time for a revolution in economic thought.




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Sunday 8 February 2009

High forex reserves can worsen recession

 

8 Feb 2009, 0057 hrs IST
, Swaminathan S Anklesaria Aiyar


High foreign exchange reserves have, in the current global recession, saved Asian countries (including India) from the travails they suffered in the Asian financial crisis of 1997-2000. So, they must aim for rising forex reserves in future too, right? Wrong.

In truth, high Asian forex reserves are an important reason for the current recession. High reserves promise safety in a storm. But, beyond a point this safety becomes illusory, because rising forex reserves worsen the global imbalances that have precipitated the recession.

The global recession has many roots. One is the erosion of traditional US household prudence. US households used to save 6% of their disposable income. But in recent years they went on a borrowing and spending spree, and household savings dropped to virtually zero. Corporations and financiers also ran up record debts, partly to buy assets such as houses, stocks and commodities. This created huge bubbles in all three markets.

When the bubbles finally burst, US households, corporations and financiers found themselves in dire straits. Many financial giants were rescued by the government. Meanwhile households, sobered by the turn of events, started saving 4% of disposable income, up from zero. More saving meant less spending, and made the recession deep and sharp.

Most Asians are smugly blaming US imprudence and loose financial regulation for the crisis, while portraying themselves as innocent victims. Yet, they must share the guilt too. US profligacy did not arise in a vacuum. It arose in part because Asian insistence on high forex reserves meant that they poured dollars into the US to buy US securities. This flood of dollars from Asia drove down US interest rates, making it very attractive to borrow. That spurred the borrowing spree, and the accompanying bubbles.

Historically, rich countries had surplus savings, manifested in a trade surplus. Poor countries lacked savings, manifested in trade deficits, with the deficit being plugged by an inflow of dollars from rich to poor countries. For the world as a whole, current account surpluses and deficits of countries must necessarily balance. Historically, the surpluses of rich countries were offset by the deficits of poor ones.

But after the Asian financial crisis, something strange happened. Asian countries, above all China, began generating huge savings surpluses, manifested in huge current account surpluses. Many used undervalued exchange rates to artificially create trade surpluses, which were then invested in US treasuries (that is what foreign exchange reserves are).

However, poor Asians could not run huge surpluses unless others were willing to run huge deficits. Remarkably, the rich US began to do so. This arose partly from the sophistication of its financial system, which found many ways - too many, in fact - of converting the flood of money from Asia into a borrowing and spending spree. This sharp rise in US spending boosted the global economy, and created the record global GDP growth in 2003-08. US demand sucked in huge quantities of manufactures and services from Asia, above all from China. Asian manufacturing sucked in huge quantities of commodities from Africa and Latin America, raising incomes there too.

Alas, this boom was based on huge global imbalances that had to be corrected at some point. No country, not even the rich US, could keep running gargantuan trade deficits forever, to offset the surpluses of Asia. US asset bubbles burst, the boom ended, and US spending and imports plummeted.

Ending the consequent recession means reducing global imbalances to manageable proportions. Americans will have to save more, spend less and export more. Asian countries, especially China, will have to consume more, save less, and export less. This re-balancing will restore global balance, and enable global growth to rise sustainably again.

However, such re-balancing means that Asian countries must stop piling up ever-rising forex reserves (and trade surpluses). Such reserves represent excessive saving, excessive exports and insufficient imports. Excess forex reserves have provided apparent safety to Asian countries in a recessionary crisis, yet are also a cause of that very crisis.

What will happen if Asians insist on trying to keep savings and forex reserves high? Well, if Asians keep savings high and Americans and Europeans do so too, then world demand will collapse and the recession will become a Depression. Asians must recognise that high forex reserves serve as a safety cushion only up to a point, and beyond that exacerbate global imbalances that threaten disaster. Saving too much can be as harmful as saving too little. Unless Asian countries recognize this and go slow on future reserve accumulation, the recession may become worse than anyone dares imagine today.


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What's The Point?


 

For the first time in my life I resent paying my taxes. A high proportion of the taxes I pay will be used to bail out companies which have used every imaginable ruse to avoid paying any themselves. I think that for many people this is the final blow: the insult which seals their alienation from the political process...

GEORGE MONBIOT
 
For the first time in my life I resent paying my taxes. Until now I have seen this annual amputation as a civic duty -- like giving blood -- necessary to sustain the life of a fair society. Suddenly I see it as an imposition. Its purpose has reverted to that of the middle ages: subsidising the excesses of a parasitic class. A high proportion of the taxes I pay will be used to bail out companies which, as the Guardian's current investigation shows, have used every imaginable ruse to avoid paying any themselves.
 
I think that for many people this is the final blow: the insult which seals their alienation from the political process. The small Welsh town where I live, many of whose inhabitants are among the very poor, was once a haven of progressive politics, built from nonconformist religious sects and a long tradition of social solidarity. People from these valleys were transported to Van Diemen's Land for demanding the vote.

Now almost everyone I speak to says the same thing -- "what's the point? They're all as bad as each other" -- and I can find no argument to refute it. Had their forebears been told that, 125 years after the first agricultural workers got the vote(1), the poor would be bailing out the rich and (thanks to the first-past-the-post system) the votes of only a few thousand citizens would count, I doubt they would have bothered.
 
We are trapped in a spiral of political alienation. Politics isn't working for us, so we leave it to the politicians. The political vacuum is then filled with heartless, soulless, gutless technocrats: under what other circumstances could political ghosts like Jack Straw, Geoff Hoon, Alistair Darling, Hazel Blears, Peter Mandelson or John Hutton remain in office? Unmolested by the public, corporate lobbyists collaborate with this empty political class to turn parliament into a conspiracy against the public. Revolted by these phantoms, seeing nowhere to turn, we withdraw altogether, granting them even richer opportunities to exploit us.

The government talks of re-igniting public enthusiasm for politics, of bringing out the vote, but balks at any measure which might make this happen. The reform of the House of Lords has again been postponed until after the next election, if at all (2). The promise, in Labour's 1997 manifesto, of a referendum on electoral reform is long-forgotten. It now looks as if nothing will be done to stop MPs from moonlighting, as our representatives argue that they cannot possibly get by on £63,000 a year (plus lavish expenses) (3). I wonder whether they have any idea how that plays in a town like this.

Consultations are rigged. Citizens' juries are used to lend a sheen of retrospective legitimacy to decisions already taken. The Big Conversation turned into a lecture. LabourList, mercilessly satirised by Catherine Bennett in this week's Observer (4), seeks to create a grassroots movement where no grassroots exist.

But I doubt that the government could revitalise politics, even if it had the best intentions. If the people of this country are to be mobilised, if new life is to be breathed into politics, we have to do it ourselves. As soon as you acknowledge this, you see the problem: we have lost our base. The affiliated trade unions have turned into the government's nodding dogs, continuing to fund the Labour Party even as it destroys everything they claim to stand for. The old social democratic and non-conformist movements have gone. All we have left are the NGOs and a series of informal direct action movements. They have proved to be good at raising public awareness, less good at building sustained, multi-faceted campaigns.We require a permanent mobilisation, and it might be just about to begin.

For several years, activists have been proposing a MoveOn campaign for the United Kingdom. MoveOn.org is an web-based coalition in the United States that has mobilised around three million people to demand progressive change. It was launched in 1998 as a petition to Congress "to censure President Clinton and move on", rather than impeach him (5). Since then, it has been credited with revitalising the Democratic Party and changing the face of American politics. Some of the claims its promoters make are exaggerated, but no one disputes that it has inspired hundreds of thousands of alienated people to re-engage.

At the beginning of every year, MoveOn polls its members on their political priorities and then mobilises them around those demands (6). It encourages them to bombard their representatives with emails and phone calls, to raise political funds and to propose new legislation. Every year it scores small victories, on issues as diverse as Medicare reform and Facebook privacy (7). It also appears to have contributed to some very large ones: some people claim that neither the candidacy nor the presidency of Barack Obama would have been possible without it. MoveOn has made mistakes -- its position on the Iraq war, for example, has been hopeless(8) -- but it's obvious that the model works.

There have been campaigns a bit like this in the United Kingdom, but they have tended to concentrate on a single outcome and to disperse or relax when it has been achieved. The Big Ask, run by Friends of the Earth, mobilised 200,000 people to demand a climate change bill -- and got it(9). The Local Works coalition drove the Sustainable Communities Bill through parliament (10). The closest relative of MoveOn in the UK so far is Unlock Democracy, which, with far smaller resources than its American cousin, has already changed the way we are governed. Last month, for example, working with groups like enoughsenough.org and mySociety, it managed to stop MPs from hiding their expenses from the public(11).

Today Nick O'Donovan, a British academic working in the US, launches a movement in the United Kingdom built overtly on the MoveOn model. Dosomethingaboutit.org.uk is a rolling petition which seeks to ensure that the people who sign up don't lose touch with each other. When there's an important vote in parliament or when the government is threatening to shut down a useful public service or to waste our money on subsidising the rich, it will set up a petition and mobilise its members. Like MoveOn, it will also poll them over the issues they want to champion. At elections it will help people to decide which candidate in their constituency to support, in order to avoid splitting the progressive vote. Its purpose is to strike fear into the hearts of our self-serving technocrats and, it says, to make "the moral high ground electorally viable"(12).

I hope O'Donovan and his colleagues know how much they are taking on. They will be fighting party machines which have refined every dirty trick in politics; the hopelessness that arises from 12 years of broken promises; a labour movement that seems to have abandoned every political aim except driving foreigners out of the workplace; an electorate that has ceased to believe in itself. But none of this is a reason not to try.

Dosomethingaboutit is a bold and wildly ambitious scheme. Can it work? That's up to you.

www.monbiot.com

References:

1. The Representation of the People Act 1884.This extended the vote to some rural men, but only if they owned land worth £10 or paid £10 a year in rent.

2. George Parker, 14th July 2008. Straw seeks to defer Lords reform. Financial Times.

3. Sam Coates, 2nd February 2009. Peers can carry on lobbying despite payments row. The Times.

4. Catherine Bennett, 1st February 2009. Does Labour really think John Prescott is the new Obama? The Observer.

5. moveon.org

6. pol.moveon.org
7. Success stories
8. Norman Solomon, 13th March 2007. The Pragmatism of Prolonged War. Fairness and Accuracy in Reporting

9. foe.co.uk 

10. localworks.org

11. Unlock Democracy, 21st January 2009. People power forces Government to back down on MPs' expenses

12. dosomethingaboutit.org.uk




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Friday 6 February 2009

India's Terror Dossier: Further Evidence of a Conspiracy


By Raveena Hansa

05 February, 2009
Countercurrents.org

 

On 5 January 2009, the Indian government handed a 69-page dossier of material stemming from the ongoing investigation into the Mumbai terrorist attacks of 26-29 November 2008 to the Pakistani government. This was subsequently made accessible to the public [1], so it is possible for us to examine it.

The most striking point about the dossier is its vague and unprofessional character. Enormous reliance is placed on the interrogation of the captured terrorist, Mohammed Amir Kasab, despite the fact that there is an abundance of other evidence – eyewitness accounts, CCTV and TV footage, forensic evidence, etc. – which could have been called upon to establish when, where, and what exactly happened during the attacks. This gives rise to the suspicion that the interrogation is being used as a substitute for real investigation because it can be influenced by intimidation or torture, whereas other sources of evidence cannot be influenced in the same way.

 

The account gleaned from interrogation would be far more convincing if it were corroborated by evidence from other sources. Thus it seems to have been established that Kasab is from Faridkot in Pakistan, and we also know from eyewitness accounts that he was captured at Girgaum, thanks to the heroism of Assistant Sub-Inspector Tukaram Ombale. But a real charge-sheet would require the rest of the account supplied by Kasab to be confirmed by other evidence. For those who know Bombay, who were glued to their TV screens while the ghastly events unfolded, and who also followed reports in the print media, including Marathi newspapers, the account in the dossier just won't do.

 

A Very Significant Omission

 

Let us follow one trail from the point where the terrorists landed. According to the dossier, all ten terrorists landed at Badhwar Park on Cuffe Parade in an inflatable dinghy, then split into five pairs, and took taxis to their destinations. Kasab and Ismail Khan were assigned to CST station (better known as VT), and allegedly entered the station and started firing indiscriminately at 'about 21.20 hrs' (p.5). But according to an eyewitness at VT, Bharat Patel, a chef at Re-Fresh Food Plaza which was riddled with bullet-holes, firing in the mainline station started at 9.55 p.m. [3]. According to CCTV footage, it was at 21.55 that passengers, who had earlier been walking around normally, began running for cover in the suburban part of the station while the railway police attempted to take on the terrorists, and at 22.13 p.m., the terrorists were still in VT station [4]. Motorman O.M.Palli said, 'I heard the last bullet sound at 10.32,' and when asked how he could be so sure of the time, replied, 'I am a motorman; I keep time by the seconds' [5]. So why does the dossier prepone the assault by 35 minutes, when there is evidence which enables us to establish its timing far more precisely?

 

VT station opens onto Dadabhai Naoroji (DN) Road, which runs northwards parallel to the railway tracks and becomes Mohammed Ali Road; Mahapalika Marg begins in front of VT, going off DN Road to the northwest. Travelling from VT along Mahapalika Marg, one passes, on the right, the Municipal Corporation buildings, the Esplanade Metropolitan Magistrate's Court, Cama Hospital, and St. Xavier's College; it then carries on to Metro Junction. The third side of the triangle is constituted by Lokmanya Tilak Marg, on which the Police Headquarters is located, which runs between Metro Junction and Mohammed Ali Road. However, a large part of the triangle is occupied by a police complex, including police residential quarters. Running between DN Road and Mahapalika Marg is a lane, at least part of which is named Badaruddin Tyabji Marg, which goes off DN Road opposite the middle of VT station, turns right, going past the back of the Esplanade court and Cama Hospital on the left, then some distance further passes the CID Special Branch Building which houses the Foreigners' Regional Registration Office (the southernmost part of the large and sprawling police complex) on the right, turns sharp left, passes the side of St Xavier's College on the left, and exits onto Mahapalika Marg (see [2]). It is important to keep this geography in mind when assessing the account in the dossier.

The dossier continues, 'They left the station, crossed an over-bridge and fled into a lane towards Cama hospital. Near Cama hospital they were challenged by a police team and there was an exchange of fire. As they exited the lane, they fired on a police vehicle carrying three senior police officers and four policemen' (p.6). The reader of this account is being asked to believe that Kasab and his colleague were involved in two encounters, presumably survived the first to be able to engage in the second, and that these encounters occurred in relatively quick succession. Prima facie, none of this sounds credible. In fact, what the dossier has done is to transpose an incident that occurred in Cama Hospital to the area just outside the hospital, in the lane at the back. What happened in Cama Hospital for Women and Children is that two Marathi-speaking terrorists armed with AK-47s and grenades killed two guards and spared a third who was in civilian dress and begged for his life [6], and then made a beeline for the terrace of the hospital, taking the liftman Tikhe with them [7]. After 15-30 minutes, a police party led by officer Sadanand Date arrived, was taken up to the 6th floor (which had no wards and was therefore empty at night) by another guard, Ghegadamal, after which a fierce battle ensued for 30-45 minutes, during which Date was seriously injured and two policemen died [8].

 

The fact that an incident took place in Cama Hospital involving two Marathi-speaking attackers, and that this was widely reported in the papers, would obviously be a source of embarrassment if the dossier is bent on showing that the terror attacks of late November involved only Pakistani nationals. Presumably that is why this whole sequence of events (in Cama Hospital) has been omitted from the dossier? In fact, this omission raises several other questions. First and foremost, who were these Marathi-speaking terrorists, why were they in Cama Hospital, and what happened to them afterwards?

 

Second, and no less important, is the question asked by Minority Affairs Minister A.R.Antulay: if there was no hostage situation in the hospital, why was an officer of the rank of ATS Chief Karkare sent there, and not to the Taj, Oberoi or Nariman House, where battles would have been raging by this time [9]? According to constable Arun Jadhav, who is the only eyewitness cited in the dossier (p.6), Hemant Karkare and others were called to Cama only after Date was wounded and had to retreat, which could not have been before 23.40, and was possibly somewhat later [10].

 

This timing is corroborated by the account given by a government driver, Maruti Phad, who lived off the lane in which the officers were reportedly killed. He stated on NDTV that at 23.30 he received a call from his boss, the Medical Education Secretary, summoning him to Mantralaya. As he drove down the lane to Mahapalika Marg, there was firing, and he was hit in the hand by bullets. He had the presence of mind to duck and reverse rapidly, and when the car stopped, pretended to be dead. The last thing Mr Phad added as he concluded his account of this episode was, 'Karkare mere pichhe thha' ('Karkare was behind me') [11]. Again, a proper investigation would have to reconstruct details from his eyewitness testimony. Here the suggestion seems to be that the killers of Karkare, whoever they were, were waiting at the corner outside St Xavier's College, and mistook Phad's vehicle for the one which Karkare was using.

 

In fact, the battle in which Karkare and his companions were reportedly killed was not at the exit of the lane but several yards before the exit, in front of the branch of Corporation Bank at the side of St Xavier's College, which bore the marks of several bullet-holes. If we accept that Kasab and Ismail conducted the massacre in VT, then they would have escaped from VT station, crossed the footbridge over DN Road and run along the lane going past the back of Cama Hospital around 22.40. If they were not involved in the attack inside Cama, what possible reason would they have for hanging around for at least an hour in a lane which is on the edge of a police complex and would have been full of cops by then due to the standoff at Cama, when they could have hijacked any number of cars from the main road (Mahapalika Marg) and escaped? Even in the event that they had been told Karkare was a target (extremely unlikely, since Karkare's revelations regarding the Samjhauta blasts (see below) had been welcomed in Pakistan), neither they nor their handlers in Pakistan could possibly have known that he would be coming down that lane an hour later. Give all this, it seems most unlikely that they could have been the killers of the police officers and constables killed in Badaruddin Tyabji Lane. Which leaves us with the crucial question: who killed Hemant Karkare?

 

A.R.Antulay was by no means alone in raising doubts about who exactly had killed Hemant Karkare, nor were such questions raised only by Muslims. Starting with an investigation into a terrorist attack in Malegaon in September 2008, Karkare had begun unearthing a terrorist network linked to Hindu extremist organisations with huge ramifications, some leading to military and bomb-making training camps and politicised elements in the army, others to religious figures like Sandhvi Pragyasingh Thakur and Dayanand Pandey, and yet others to organisations and political leaders affiliated to the BJP. These revelations confirmed an earlier enquiry by the ATS, which had linked Hindu extremist groups to several terrorist attacks in Maharashtra, but had never been followed up. One of the most potentially explosive discoveries was that a serving military intelligence officer, Lt.Col. Srikant Purohit, had procured 60 kg of RDX from government supplies, some of which was used in the terrorist attack on the Samjhauta Express (the India-Pakistan 'Understanding' train) in February 2007, in which 68 people were killed, the majority of them Pakistanis. Leading members of the BJP and Shiv Sena had vented open hostility against Karkare and the Malegoan investigation, demanded that he be removed from the case, organised support for the accused, and planned to hold a bandh against him on 1 December. Indeed, earlier on the 26th, an editorial in the Shiv Sena's Saamna attacked the investigation, and Karkare received a death threat [12].

 

When someone who has been vilified and threatened with death is killed under mysterious circumstances, it is only logical to suspect those who had been conducting a campaign against him of having a hand in his death. The way the dossier constructs its narrative points in the same direction.

 

Other Anomalies and Omissions

 

According to Jadhav's original testimony, Kasab and Ismail hijacked the the police vehicle in which Karkare had been travelling and drove it first to Metro Junction, where they fired three rounds at journalists and police vans (see [10]). There was indeed a shootout at Metro, captured on camera by a TV crew [13], but there is no mention at all of this incident in the dossier. Why not? Again, the implication is that the terrorists involved in the incident at Metro were not Kasab and Ismail but members of the other group, who drove there after killing Karkare and his companions.

 

Secondly, the dossier mentions that the return journey to Pakistan was charted on the GPS instrument (p.22-23), yet the terrorists, unlike those who hijacked Indian Airlines flight IC-814 to Kandahar, made no attempt to use their hostages to secure their own or anyone else's escape. If, for example, they had announced, via the e-mail connection they used to claim the attacks for the 'Deccan Mujahideen', the names of some high-profile and foreign hostages, there would have been enormous pressure on the Indian government from family, friends and governments of the hostages to get them released. The fact that there was no such attempt suggests that this was a suicide mission; in which case, why was a return journey to Pakistan charted on the GPS when no one would be returning?

 

Thirdly, the intercepted calls cited in the dossier are emphatic that no Muslims should be killed (p.53, 54), yet in the carnage at VT station, 22 of the victims – well over one-third of the total – were Muslims [14]. The Walliullah family lost six members, and many of these victims would easily have been identified as Muslims from their appearance. This almost suggests that Muslims were deliberately being targeted: the exact opposite of what the Pakistani handlers had ordered! One possible explanation of this, also suggested by the fact that there were simultaneous attacks on the mainline and suburban sections of VT, is that there were two pairs of terrorists attacking the station, one of which was not from Pakistan.

 

Fourthly, it is clear from the translations of selected intercepted calls in the dossier (Annexure VII, p.51-54), that the cellphones of the terrorists were the main means by which they stayed in touch with their handlers and received instructions from them. What is not mentioned is that on 6 December, two people were arrested by the Kolkata police for supplying three SIM cards for these very cellphones: Tausif Rehman and Mukhtar Ahmed. Rehman was reported to have obtained the SIM cards in the name of deceased persons and other fake IDs, while Ahmed passed them on to LeT operatives.

 

Initially seen as a breakthrough in the investigation, the arrests soon became an embarrassment when it was discovered that Ahmed was an Indian intelligence operative who had infiltrated LeT. This incident has been used to make the charge that the whole Mumbai terrorist attack was a 'false flag' operation masterminded by Indian, US and Israeli intelligence services [15]. This seems far-fetched, but it certainly appears that something more sinister than a mere 'intelligence failure' on the part of Indian intelligence services is involved. What the SIM card episode and other reports suggest is that some parts of the Indian intelligence establishment had prior intimation that an attack was being planned. This prior intelligence was specific enough to identify seaside targets, in particular hotels. Hotel managements were in fact issued a general security alert some weeks before the attacks. Despite this, no attempt was made to prevent the attacks.

 

A month after the attacks, the government of Maharashtra appointed a two-member enquiry committee consisting of former Union Home Secretary Ram Pradhan and retired Indian Police Service officer V.Balachandran to investigate the occurrence of the terrorist attack and management of the ensuing crisis by the state administration. One hopes that these professionals will look at the evidence in its totality, sifting the more reliable pieces of information from those which are either patently false or contrived in some way.

 

Conspiracy Theories versus Supernatural Explanations

 

Most people react negatively to conspiracy theories. It is as if, when you are a child, someone tells you that your mother or father is a criminal: the first response is denial, even if you know in your heart of hearts that there is something in the accusation. From this comes the stereotype of 'conspiracy theorists' as crackpots.

 

Yet there are occasions when the conspiracy theory makes sense, and it is those who deny it who have to resort to supernatural explanations. A famous case is the assassination of President John F. Kennedy. The Warren Commission, set up to enquire into the assassination, came out with the theory that he was killed by a lone assassin, Lee Harvey Oswald, who was subsequently himself assassinated. But several books, as well as Oliver Stone's film JFK, showed that the official version rested on the assumption of three bullets fired from the same location, one of which changed direction more than once, went through President Kennedy and Governor Connally, and emerged in an almost pristine condition. Against this 'magic bullet' theory, the alternative explanation – that there was more than one assassin – sounds more plausible, especially given eyewitness accounts that there were more than three shots, and that they came from different directions. But the failure to pursue this line of investigation strongly suggests a conspiracy, and a large majority of Americans believe in it.

 

Closer to our time, the 9/11 Commission report gave rise to considerable criticism in the US; by November 2008, there were apparently some 150 million web pages devoted to 9/11 conspiracy theories, several books had been written, and a large number of Americans believed the attack had been an 'inside job' designed to provide a pretext for military attacks on Afghanistan and Iraq [16]. (For these people, incidentally, the claim that '26/11 was India's 9/11' would mean that the Indian state is implicated in the Mumbai attacks!) It would be hard to prove that all these people are crackpots: many are scholars, pilots, architects, engineers and other professionals with specialised knowledge, as well as eyewitnesses. One of the criticisms related to the claim that it was the fire generated by the planes crashing into the WTC towers that led to their collapsing on their own footprint. Never before or since has fire led to buildings collapsing in this way, they argue, whereas this is exactly what happens when a controlled demolition takes place. They clinch the argument by referring to WTC Tower 7, which collapsed on its footprint without even being hit by a plane. Controlled demolitions imply that explosives had been laid beforehand, and that evidence for them was covered up afterwards: i.e., a conspiracy. But, like the JFK assassination, this is a case where the conspiracy theory complies with the laws of nature whereas the official version does not.

 

It is not necessary to allege that the government or head of state is involved in a conspiracy: it would be absurd, for example, to suspect that President Kennedy was involved in a conspiracy to assassinate himself. All that is required is that some elements in the state are involved. So what would a conspiracy theory of the Bombay terrorist attacks look like? One hypothesis is that Hindu nationalist elements in the Indian state had fairly precise intelligence of the planned terrorist attacks in Bombay, but instead of acting to prevent them, decided to enhance them instead, by adding more terrorists to the operation at VT, putting bombs in the taxis which blew up at Dockyard Road and Vile Parle, and positioning gunmen throughout the area, including Cama and the vicinity of the Metro.

 

Why would they have conspired in this way? Two reasons. The first and most pressing reason was that Hemant Karkare was rapidly uncovering just how extensive their network was, and how deeply they were implicated in a large number of terrorist attacks which had previously been attributed to Muslim jihadi groups. He had to be stopped at all costs, but an obvious murder by Hindutva terrorists could lead to a backlash against them. A terrorist attack by Pakistanis provided the perfect cover for the assassination. The second reason was that several Assembly elections were pending, and the BJP would be able to take advantage of the attack to accuse the UPA of being 'soft on terrorism'. In fact, the disappointment and dismay of BJP leaders after the election results came out was very evident, when they discovered that they had not gained as much as they hoped from the Mumbai attacks. But this disappointment was offset by the elimination of Karkare. The Minister of External Affairs, Prime Minister, Defence Minister, etc. immediately blamed 'Pakistan' for the attack, and the whole discourse of the media, which had been following the Malegaon case, shifted decisively back to 'terrorists from Pakistan'.

This 'conspiracy theory' is able to explain several things which remain unexplained in the 'official version', for example: (a) why, despite prior intelligence of the attacks, nothing was done to prevent them; (b) the Cama Hospital incident involving Marathi-speaking terrorists, and the outbreak of firing and general mayhem at Metro Junction; (c) the carnage at VT, where far more people were killed than at any other location, and the high proportion of Muslims killed there (contrary to the instructions given to the main group of terrorists); and (d) last but not least, the murder of Hemant Karkare at a time when Pakistani terrorists could only have been present at that location if time had stood still during the hour or more when the battle at Cama Hospital was raging.

 

Providing Justice to the Victims and Security to the Public

 

The main requirement for providing justice to the victims of the attack is to identify and punish all those involved in perpetrating it. This should be done in a manner that satisfies the requirements of the law. The Lockerbie case, which involved a terrorist attack on a plane over Scotland, victims from the US, UK and France, and accused from Libya, was tried by a Scottish court sitting in The Hague. A similar model would be ideal in this case: trial by an Indian court, since the attack took place in India and most of the victims were Indian, but in The Hague, since there were also victims from fifteen other countries (see p.14 of the dossier) and the accused are from Pakistan. It is especially important to have transparent legal proceedings that conform to international standards in order to help ensure that the case is conducted to the satisfaction of all parties, and also help to defuse the tension between Pakistan and India.

 

The broader aim of providing security to the public requires that members of terrorist networks in both countries should be rounded up and put behind bars. It is good that the international community is putting pressure on the government of Pakistan to do this in their country, and it is essential that this pressure should be sustained till results are achieved. As long as the Pakistan-based terror networks remain intact, further strikes cannot be ruled out, and these could have catastrophic political consequences for the subcontinent. But focusing simply on those networks will not, by itself, provide safety to us in India. Our security in addition requires the government here to eliminate terrorist networks in this country, including Hindutva ones. It is heartening that the ATS is proceeding with the prosecution of the Malegaon blast accused, and has presented the 4250-page charge-sheet that Hemant Karkare risked his life to work on, although it remains to be seen whether convictions will follow or the accused will be acquitted on some pretext. But even if there are convictions, that is not enough; Karkare was only able to uncover the tip of the iceberg before he was struck down, and a great deal more remains to be done. If it is not, we can predict with a fair degree of certainty that the Hindutva terrorists would strike again before the Lok Sabha elections, and the parties that are linked to the terrorists would use the opportunity to accuse the UPA of being 'soft on terrorism' in order to come to power. If they succeed, we could be faced with the horrific prospect of a military conflict between India and Pakistan that escalates into nuclear war.

 

[1] See http://www.hindu.com/nic/dossier.htm for a scanned copy of the dossier.

[2] See http://maps.google.com/maps?hl=en&q=badaruddin%
20tyabji%20marg&um=1&ie=UTF-8&sa=N&tab=w
l (the link takes you to a map of the US, and asks, 'Did you mean: Badaruddin Tyabji Marg… etc.' If you click on this link you go to the correct map.)

[3] Rahi Gaikwad, 'Retracing the CST Attack,' The Hindu, 4 December 2008, http://www.hindu.com/2008/12/04/
stories/2008120461882000.htm

[4] http://www.allvoices.com/contributed-news
/1950266-see-cctv-of-chhatrapati-
shivaji-terminus-cst-terrorist-attack-at-mumbai

[5] Rahi Gaikwad, 'A hero at work,' Frontline, 20/12/2008,
http://www.hinduonnet.com/fline/fl2526/stories/
20090102252602800.htm

[6] Maharashtra Times and Navakaal of 29/12/2008,; see also
http://www.twocircles.net/2008nov29/
mumbai_attack_terrorists_spoke_marathi.htm


[7] http://www.monstersandcritics.com
/news/southasia/news/article_
1445785.php/SIDEBAR_Hospital_
staffer_recounts_escape_from_terrorists_

[8] http://spoonfeedin.blogspot.com/2008/12
/india-mumbai-attackscama-staff-rose-to.html

[9] Manoj C.G. and Seema Chishti, Indian Express, 17/12/2008,
http://www.expressindia.com/latest-news
/Antulay-selfgoal-sees-a-Malegaon-
mystery-in-Karkare-Mumbai-murder/399670/

[10] Indian Express, 29/12/2008
http://www.indianexpress.com/news/witness-account
-of-karkare-kamte-and-salaskars-death/392181/

[11] Prachi Jawdekar Wagh, 'Mumbai driver recounts battle for survival,' 6/12/2008
http://www.ndtv.com/convergence/
ndtv/mumbaiterrorstrike/Story.aspx?ID=
NEWEN20080075496&type=News

[12] Y.P.Rajesh, Indian Express, 27/11/2008,
http://www.expressindia.com/latest-news/ATS-chief-
Hemant-Karkare-dies-a-heros-death/391325/

[13] 'ATS Chief Hemant Karkare Killed: His Last Pics: IBNLive.com,'
http://ibnlive.in.com/videos/79133/ats-
chief-hemant-karkare-killed--his-last-pics.html

[14] Srinivasan Ramani, 'Attack on "Everyday India",' Pragoti, 9/12/2008, http://www.pragoti.org/node/2720

[15] Kurt Nimmo, PrisonPlanet, 7/12/2008,
http://www.prisonplanet.com/
arrest-provides-more-evidence-india
-israel-and-the-us-behind-mumbai-attacks.html

[16] See, for example, http://bushstole04.com/ , http://www.911truth.org/ , and millions of other websites that come up if you type '9/11 truth' into Google.





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¡Que se vayan todos!


 

¡Que se vayan todos! - that's the global backlash talking

It's not just governing elites that the world is rising up against - it's the entire model of deregulated capitalism

 

Watching the crowds in Iceland banging pots and pans until their government fell reminded me of a chant popular in anti-capitalist circles in 2002: "You are Enron. We are Argentina."

 
Its message was simple enough. You - politicians and CEOs huddled at some trade summit - are like the reckless scamming execs at Enron (of course, we didn't know the half of it). We - the rabble outside - are like the people of Argentina, who, in the midst of an economic crisis eerily similar to our own, took to the street banging pots and pans. They shouted, "¡Que se vayan todos!" ("All of them must go!") - and forced out a procession of four presidents in less than three weeks. What made Argentina's 2001-02 uprising unique was that it wasn't directed at a particular political party or even at corruption in the abstract. The target was the dominant economic model: this was the first national revolt against contemporary deregulated capitalism.
 
It has taken a while, but from Iceland to Latvia, South Korea to Greece, the rest of the world is finally having its ¡Que se vayan todos! moment.
 
The stoic Icelandic matriarchs beating their pots flat even as their kids ransack the fridge for projectiles (eggs, sure, but yoghurt?) echo the tactics made famous in Buenos Aires. So does the collective rage at elites who trashed a once thriving country and thought they could get away with it. As Gudrun Jonsdottir, a 36-year-old Icelandic office worker, put it: "I've just had enough of this whole thing. I don't trust the government, I don't trust the banks, I don't trust the political parties and I don't trust the IMF. We had a good country, and they ruined it."
 
Another echo: in Reykjavik, the protesters clearly won't be bought off by a mere change of face at the top (even if the new PM is a lesbian). They want aid for people, not just banks; criminal investigations into the debacle; and deep electoral reform.
 
Similar demands can be heard in Latvia, whose economy has contracted more sharply than any country in the EU, and where the government is teetering. For weeks the capital has been rocked by protests, including a full-blown, cobblestone-hurling riot on 13 January. As in Iceland, Latvians are appalled by their leaders' refusal to take any responsibility for the mess. Asked by Bloomberg TV what caused the crisis, Latvia's finance minister shrugged: "Nothing special."
 
But Latvia's troubles are indeed special: the very policies that allowed the "Baltic tiger" to grow at a rate of 12% in 2006 are also causing it to contract violently by a projected 10% this year: money, freed of all barriers, flows out as quickly as it flows in, with plenty being diverted to political pockets. (It is no coincidence that many of today's basket cases are yesterday's "miracles": Ireland, Estonia, Iceland, Latvia).
 
In Latvia, much of the popular rage has focused on government austerity measures - mass layoffs, reduced social services and slashed public sector salaries - all to qualify for an IMF emergency loan (no, nothing has changed). In Greece, December's riots followed a police shooting of a 15-year-old. But what's kept them going, with farmers taking the lead from students, is widespread rage at the government's crisis response: banks got a $36bn bailout while workers got their pensions cut and farmers received next to nothing.
 
Despite the inconvenience caused by tractors blocking roads, 78% of Greeks say that the farmers' demands are reasonable. Similarly, in France the recent general strike - triggered in part by the plans of President Sarkozy to reduce dramatically the number of teachers - inspired the support of 70% of the population.
 
Perhaps the sturdiest thread connecting this global backlash is a rejection of the logic of "extraordinary politics" - the phrase coined by the Polish politician Leszek Balcerowicz to describe how, in a crisis, politicians can ignore legislative rules and rush through unpopular "reforms". That trick is getting tired, as South Korea's government recently discovered. In December, the ruling party tried to use the crisis to ram through a highly controversial free trade agreement with the US. Taking closed-door politics to new extremes, legislators locked themselves in the chamber so they could vote in private, barricading the door with desks, chairs and couches.
 
Opposition politicians were having none of it: using sledgehammers and an electric saw, they broke in and staged a 12-day sit-in of parliament. The vote was delayed, allowing for more debate - a victory for a new kind of "extraordinary politics".
 
The pattern is clear: governments that respond to a crisis created by free-market ideology with an acceleration of that same discredited agenda will not survive to tell the tale. As Italy's students have taken to shouting in the streets: "We won't pay for your crisis!"




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