The Blame Game Begins: Who Will Be Held Responsible for Creating the Afghan “Vertically Integrated Criminal” Government?

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Last Sunday, the Beltway professed to be shocked — shocked!! — that the CIA has been bribing Hamid Karzai for years.

Moreover, there is little evidence that the payments bought the influence the C.I.A. sought. Instead, some American officials said, the cash has fueled corruption and empowered warlords, undermining Washington’s exit strategy from Afghanistan.

“The biggest source of corruption in Afghanistan,” one American official said, “was the United States.”

Fred Kaplan, author of a fawning David Petraeus biography, described how Petraeus tried to fix that corruption but was stymied by practicality.

Petraeus was impressed with their analysis but found their proposals impractical. First, he couldn’t simply bypass Karzai. One of his strategic goals was to help stabilize Afghanistan. Overhauling the districts’ governing boards and transferring power to new officials—who may themselves just be a new array of warlords—was hardly a recipe for stability. Second, the plan would undermine another strategic goal—protecting the Afghan population. The local officials who were taking bribes and extorting merchants were also helping out with local security, sometimes guarding convoys of NATO supply trucks. If the cash spigot were shut off, they might let the Taliban attack those trucks, maybe even join in.

Then Sarah Chayes, one of the civilian advisors who fought against Afghan corruption in the transition period from Stanley McChrystal to Petraeus, wrote an account of what Petraeus really did.

Our PowerPoint presentation spelling out this plan ran to more than 40 slides. We selected a dozen we really planned to brief, but at a meeting with the entire command staff, General Petraeus read through every one. With a calculated flourish, he marked a check on each page as he turned it over. Petraeus was on board.

[snip]

But when he stood up to address the assembled brass, Petraeus seemed to skip past — or even argue against — the slides we had prepared explaining the new governance approach. We were stunned. What had happened? Had we misunderstood? Had he changed his mind?

For another month, we kept at it; I hammered out a detailed implementation of our general concept to be employed in Kandahar province, alongside the troop surge. But by mid-September 2010, it was clear to me that Petraeus had no intention of implementing it, or of pursuing any substantive anti-corruption initiative at all. Four months later, in an intense interagency struggle over the language of a document spelling out objectives for Afghanistan by 2015, the U.S. government, at the cabinet level, explicitly reached the same decision.

That was the moment I understood the Afghanistan mission could not succeed.

Like Kagan, Chayes ultimately blames CIA. But she does so, specifically, in the context of the attempted July 2010 arrest of the CIA’s bagman, Muhammad Zia Salehi.

I spent weeks wracking my brain, trying to account for the about-face. Eventually, after a glance in my calendar to confirm the dates, it came to me. It was the Salehi arrest. The Salehi arrest had changed everything.

[snip]

Throughout the unfolding investigation, two senior U.S. officials have told me, through Salehi’s arrest and release after a few hours of police detention, CIA personnel never mentioned their relationship with him. Even afterwards, despite pressure in Kabul and Washington, the CIA refused to provide the ambassador or the key cabinet officials a list of Afghans they were paying. The CIA station chief in Kabul continued to hold private meetings with Karzai, with no other U.S. officials present.

So whom did Salehi call from his jail cell the afternoon of his arrest? Was it Karzai, as many presumed at the time? Or was it the CIA station chief?

However lethal our bribes to Karzai have been to our so-called strategy in Afghanistan (though I wonder: have they simply forestalled an all-out civil war?), he’s still going to proudly receive the cash.

“Yes, we received cash from the CIA for the past 10 years. It was very useful, and we are very thankful for this aid,” the president said during a news conference Saturday in Kabul.

“Yesterday, I thanked the CIA’s chief in Kabul and I requested their continued help, and they promised that they will continue.”

If all this sounds vaguely familiar, it should.

That’s because much of this dispute played out in reporting at the time. After NYT first reported CIA’s ties to Salehi a month after the attempted arrest in 2010 — and quoted one official saying “Fighting corruption is the very definition of mission creep” — the WaPo reported more anonymous sources almost boasting of the bribes (and reminding they went back to the mujahadeen era). Read more →

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The Find Every Terrorist at Any Cost Industry

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As a thought experiment, replace the word “terrorist” in this paragraph with “soldier” or “military.”

All terrorists fundamentally see themselves as altruists: incontestably believing that they are serving a “good” cause designed to achieve a greater good for a wider constituency—whether real or imagined—which the terrorist and his organization or cell purport to represent. Indeed, it is precisely this sense of self-righteous commitment and self-sacrifice that that draws people into terrorist groups. It all helps them justify the violence they commit. It gives them collective meaning. It gives them cumulative power. The terrorist virtually always sees himself as a reluctant warrior: cast perpetually on the defensive and forced to take up arms to protect himself and his community. They see themselves as driven by desperation——and lacking any viable alternative—to violence against a repressive state, a predatory rival ethnic or nationalist group, or an unresponsive international order.

The paragraph comes from Bruce Hoffman, a Georgetown Professor/ThinkTanker whose studies of terrorism predate 9/11 by decades. It forms part of his explanation, post Boston, for why people become terrorists: because they, like our own country increasingly, see violence as a solution to their grievance.

That’s not all of Hoffman’s description of what makes people terrorists, mind you. He goes onto discuss religion and the human relations that might convince someone to engage in violence. But the paragraph has haunted me since I read it over a week ago for how clearly it should suggest that one of the few things that separates terrorism from our country’s own organized violence is official sanction (and at least lip service about who makes an appropriate and legal target).

Which is one reason why Jack Levin, in a piece debunking four myths about terrorism, offers this as one solution.

Somehow, we must reinstate the credibility of our public officials — our president, our Congress, and our Supreme Court Justices — so that alienated Americans do not feel they must go outside of the mainstream and radicalize in order to satisfy their goals.

Blaming terrorism on our dysfunctional political system feels far too easy, but it’s worth remembering that in Afghanistan, Somalia, and parts of Yemen, Al Qaeda has at times won support from locals because it offered “justice” where the official government did not or could not.

In any case, the common sense descriptions Hoffman and Levin offer haven’t prevented a slew of people responding to Boston — some experts, some not — from demanding that we redouble our efforts to defeat any possible hint of Islamic terrorism, no matter the cost.

Batshit crazy Texas Congressman Louie Gohmert claims the Boston attack is all Spencer’s fault: because FBI purged some its training materials of some of the inaccurate slurs about Muslims (but did not even correct the training of Agents who had been taught that claptrap in the first place), it can no longer speak a language appropriate to pursuing terrorists. “They can’t talk about the enemy. They can’t talk about jihad. They can’t talk about Muslim. They can’t talk about Islam.” Which elicited the equally batshit crazy response from Glenn Kessler of taking Gohmert’s premise as a valid one that should be disproven by weighing how much offensive language remains in FBI materials, rather than debunking the very premise that only people who engage in cultural slurs would be able to identify terrorists. I award Kessler four wooden heads.

Somewhat more interesting is this piece from Amy Zegart, another Professor/ThinkTanker. She admits we may not know whether Boston involved some kind of intelligence failure for some time.

Finding out what happened will be trickier than it sounds. Crowdsourcing with iPhones, Twitter, and Lord & Taylor surveillance video worked wonders to nail the two suspects with lightning speed. But assessing whether the bombing constituted an intelligence failure will require more time, patience, and something most people don’t think about much: understanding U.S. counter-terrorism organizations and their incentives and cultures, which lead officials to prioritize some things and forget, or neglect, others.

But that doesn’t stop her from insisting FBI’s culture remains inappropriate to hunting terrorists “pre-boom.”

But it is high time we asked some hard, public questions about whether the new FBI is really new enough. Transformation — moving the bureau from a crime-fighting organization to a domestic intelligence agency — has been the FBI’s watchword since 9/11. Read more →

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Maybe Dzhokhar’s Buddies Just Wanted a Job at HSBC?

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A lot of people on Twitter are talking about how dumb-as-shit Dzhokhar Tsarnaev’s college buddies, Azamat Tazhayakov, Dias Kadyrbayev, and Robel Phillipos were when they allegedly removed evidence relating to the Boston Marathon bombing and threw it in the trash or (in the case of Phillipos) lied about those activities.

I’m not convinced, though.

I’m not defending what the young men did. Nor am I vouching for their intelligence. Nor am I saying they shouldn’t be prosecuted — they should!

But I’m having a hard time distinguishing what they did from what, say, HSBC did, for years. Aside from the fact that HSBC affirmatively helped terrorists, rather than just covered up that help. And aside from the fact HSBC made a billion dollars doing so.

As a reminder, where’s what HSBC did — eliciting nary a blink of an eye from the same DOJ that is now (rightly) prosecuting these dumb-as-shit kids. They were a key — perhaps the key — bank providing Saudi al-Rajhi bank cash dollars. Details emerged in 2001 that the bank had been providing the dollars terrorists used in their plots, including the 9/11 plot. It took four years for HSBC to begin to get worried about it. But it still only halted the dollar trade for al-Rajhi while its US regulator, OCC, looked into its money laundering practices (it says something about HSBC’s awareness of the sensitivity of this issue that they didn’t halt their other abundant money laundering activities).

And then, once OCC was out of its hair, HSBC moved back into the cash dollar business with al-Rajhi, a bank reportedly involved with the most spectacular terrorist acts of recent years.

Just HSBC’s brief exit from the cash business with al Rajhi is similar to what Dzhokhar’s dumb-as-shit buddies did when they put his backpack in the public trash. Covering up terrorism.

Read more →

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When the Preet Promotion Industry Speaks, the Nation Gets Nervous

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In an article with the URL “when-preet-bharara-speaks-the-shady-get-nervous,” the WaPo repeats a now familiar formula for stories boosting US Attorney Preet Bharara’s fortune: lots of quotes from political powerful allies…

“If [Bharara] smells corruption, he’ll go after it and figure out a way to corral it,” [Chuck] Schumer said. “But he will not make up cases for the sake of making up cases.”

Lots of celebration of recent headlines (I mean, cmon, as I understand it, indicting corrupt NY officials has become the prosecutorial equivalent of shooting fish in a barrel)…

“For the second time in three days, we unseal criminal charges against a sitting member of our state legislature,” Bharara, 44, said during the Thursday afternoon news conference in downtown Manhattan. This time, the U.S. attorney accused a Bronx assemblyman of accepting bribes as part of a scheme to aid developers, which Bharara called “a fairly neat trick” that amounted to “a legislator selling legislation.”

And lots of hints that scream “Pick Preet! Promote Preet!”

It is now highly unlikely that the White House would forget about Bharara, as administration officials somehow did in 2009, when they failed to invite the Indian American powerhouse to the Indian state dinner.

[snip]

Such concerns are unlikely to slow down Bharara. Considered politically astute by observers in Washington and New York, Bharara made a point of not taking sides in the 2008 Democratic presidential primary that pitted then-senators Barack Obama and Hillary Rodham Clinton. He has been rumored as a possible successor to his boss, Attorney General Eric H. Holder Jr., either in the current administration or the next Democratic one.

But not one word about his failure to hold anyone accountable for the 2008 financial crash (aside from citing last year’s Time magazine story that falsely claimed “This Man Is Busting Wall Street”).

But Chuck Schumer and Preet’s other boosters appear to believe that’s the formula that will get Preet nominated to replace Eric Holder.

Sadly, they’re probably right.

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VirginLeak

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A number of journalistic outlets are cooperating in a project to describe the contents of 200 gigabytes of financial information from private incorporation agencies in the British Virgin Islands. The International Consortium of Investigative Journalists has links to all the stories using the data. The CBC has some of the most interesting graphics.

But I have yet to see a really good explanation of where this data came from–or why it was leaked in this form. The Guardian has one of the best explanations of what’s out there.

The leak of 2m emails and other documents, mainly from the offshore haven of the British Virgin Islands (BVI), has the potential to cause a seismic shock worldwide to the booming offshore trade, with a former chief economist at McKinsey estimating that wealthy individuals may have as much as $32tn (£21tn) stashed in overseas havens.

[snip]

The whistleblowing group WikiLeaks caused a storm of controversy in 2010 when it was able to download almost two gigabytes of leaked US military and diplomatic files.

The new BVI data, by contrast, contains more than 200 gigabytes, covering more than a decade of financial information about the global transactions of BVI private incorporation agencies. It also includes data on their offshoots in Singapore, Hong Kong and the Cook Islands in the Pacific.

And CBC offered this explanation of why they are shielding the identity of 450 Canadians who are stashing their money offshore.

The documentation provided to CBC News includes the names of some 450 Canadians who have set up these offshore accounts or holdings. We have already reported details concerning one such account-holder and expect to produce more such reports in the weeks and months to come.

At the same time, we are mindful of the reality that holding an offshore account is not evidence of wrongdoing and may not be controversial. So we are not simply reproducing the raw information we have received through the consortium. Our journalists are working through that information in a careful and methodical way to confirm the information received, identify appropriate stories, and complete them with appropriate context.

We shall see — both whether the elite of the world respond to this leak with the outrage they responded to Bradley Manning’s leaks, and whether the thus far selective nature of the stories on this betray whose agenda the leaks are serving.

While this data may just come from an insider releasing the information publicly (but then why not leak it all?), it is not inconceivable that BVI’s competitors in the secrecy business might want to cut into their market.

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Add Sovereign Citizens Who Have to Play by Rules HSBC Doesn’t

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Remember how HSBC facilitated massive money laundering, around the globe, for over a decade, but got away with a hand slap? Remember how a single check cashing store in LA got very different treatment?

Well, add sovereign citizens to the list of Americans who don’t get the treatment HSBC got.

A man known to reject government authority as a member of the “sovereign movement” was slammed with a federal sentence Wednesday of 98 months in prison and ordered to forfeit more than $1.29 million in assets.

Shawn Rice, 50, was convicted last July on one count of conspiracy to commit money laundering, 13 counts of money laundering, and four counts of failure to appear, the U.S. attorney for the district of Nevada said in a release.

Once again, after winning a harsh sentence, DOJ’s representative talked tough about the importance of prosecution.

“Persons who commit financial crimes victimize organizations, government and the public,” said U.S. attorney Daniel Bogden. “Our office and our federal partners will work jointly with local and state law enforcement to ensure that these persons are caught and prosecuted.”

If I weren’t officially on vacation, I’d check the docket on this, though for the moment I’ll accept that Rice warranted such tough treatment.

But these tough words would sure be more credible if DOJ consistently treated money launderers with this seriousness.

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Emergency Manager Kevyn Orr’s Nanny Factory

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When I wrote this post, describing Detroit Emergency Manager Kevyn Orr’s significant (and serial) tax lien in Maryland, I noted that the lien was very very high for just one nanny (which is the excuse Orr offered for the lien).

Using the numbers from the original Detroit News article, the average tax due from 2011 per delinquent Detroit property owner is about $1,790. Orr has been underpaying MD several times that every year, effectively asking the state to float his unemployment insurance obligations for two years until he gets around to paying them.

[snip]

Here’s another neat detail: The median household income in Detroit is $27,862. Orr consistently owes about $7,000 just in unemployment insurance for his nanny. It seems like most Detroit residents could get themselves a raise if only they tended Orr’s kids.

Scribe even did the math to show how high that lien was.

That’s a hell of a big paycheck to a nanny, to create UI liabilities in the $6500-9500/year range.

Calculating the actual tax rate can be a bit of a challenge, but this snip from a 10/14/2011 article (http://articles.baltimoresun.com/2011-10-14/business/bs-bz-unemployment-insurance-tax-rate-20111014_1_unemployment-insurance-maryland-employers-trust-fund ) says a lot: “Maryland has been stuck at “Table F” — rates ranging from 2.2 percent to 13.5 percent of the first $8,500 in wages paid, depending on an employer’s layoff history — since last year.”

Even assuming the worst layoff history, he’s paying a lot:
13.5 percent of 8500 is 850 + 255 + 42.50 = 1147.50
2.2 percent of 8500 is 170 + 17 = 187.00

It takes a lot more salary to get those liabilities up to where he’s finding himself. And I’m betting that, for the happiness of the kid(s) and parents who have to interview nannies, there is not much turnover and thus a lower layoff history, so his percentage is most likely toward the bottom of the scale.

Turns out Scribe was right.

Some, though, question how a baby sitter alone could be responsible for such a debt. The outstanding liens for unemployment taxes were for $6,595 for the 2010 tax year and another for $9,409 for the 2010-11 tax years.

“That’s an awful lot of taxes for a baby sitter. Are you sure he’s not running a day care?” joked Maryland tax attorney Jeffrey Katz.

He said the numbers don’t add up. In Maryland, unemployment taxes are capped at about $1,150 a year per employee, Katz said, so Orr would have to go through more than five baby sitters in one year to reach $6,500 in back taxes for one year.

[snip]

Orr said he doesn’t know why the tax bills were so high. The same baby sitter has watched his two children for a couple of years, arriving in the morning and leaving in the afternoon. No former employee has filed for jobless benefits, Orr said.

There is no way this lien is about Orr’s single nanny, who has never filed for jobless benefits.

Either Orr has far more staff members than he let on–more even than five, given that he hasn’t been laying them off. Which would itself be notable for a guy who is about to lay off a bunch of Detroit workers.

Or the lien is for something else entirely, and Orr just invented the nanny story because it’s the convenient excuse rich people always use for being tax deadbeats.

Governor Snyder is begging the press to move on now, so I’m guessing he has a pretty good sense that the nanny is just a cover story and that, at a minimum, Orr will soon have to admit he’s not just a tax deadbeat but also a fibber.

But the underlying excuse for the lien sure seems like it might be relevant to Orr’s fitness to fire a bunch of Detroit workers.

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WikiLeaks Will Be Nothing Compared to FinCENLeaks

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According to Reuters, the Treasury Department is planning on expanding access to FinCEN reports — which include Suspicious Activity Reports from over 25,000 financial institutions — to the intelligence community, including CIA.

The Treasury document outlines a proposal to link the FinCEN database with a computer network used by U.S. defense and law enforcement agencies to share classified information called the Joint Worldwide Intelligence Communications System.

[snip]

More than 25,000 financial firms – including banks, securities dealers, casinos, and money and wire transfer agencies – routinely file “suspicious activity reports” to FinCEN. The requirements for filing are so strict that banks often over-report, so they cannot be accused of failing to disclose activity that later proves questionable. This over-reporting raises the possibility that the financial details of ordinary citizens could wind up in the hands of spy agencies.

There’s so much to say about this batshit crazy plan…

First, when I made fun of John Brennan’s confirmation vow, people assured me CIA doesn’t operate in the US. Maybe not. But now they have free access to all this data on Americans.

And remember that DOJ, as far back as 2002, argued it was legitimate to use FISA to collect information on crimes the government could use to coerce people into becoming informants. Imagine how much easier that will be with access to people’s bank irregularities.

Finally, think of the security nightmare here. While I doubt anyone is going to leak a whole database of FinCEN data to WikiLeaks (though how much fun would that be?!?!), I can imagine a lot of people might avail themselves of this access to profit off the financial information. Maybe that’s how CIA will fund their ops, instead of (or inaddition to?) drug running: profiting off sensitive financial information.

There’s a whole slew of reasons why this is a bad idea. Which is precisely why it is bound to be pushed through regardless.

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James Clapper Sneaks Climate Change — But Not Bankster Speculation — Into His Threat Assessment

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You wouldn’t know it by looking at his written statement, which lists Cyber, Terrorism and Transnational Crime, Counterintelligence, and Counterspace before it lists Natural Resource Insecurity, but water and food insecurity was actually the first threat Director of National Intelligence James Clapper described in today’s Worldwide Threat Hearing.

That said, in his spoken statement, he didn’t utter the words “climate change.”

Though those words do appear in the written statement, as a subcategory of resource scarcity, as follows:

Food security has been aggravated partly because the world’s land masses are being affected by weather conditions outside of historical norms, including more frequent and extreme floods, droughts, wildfires, tornadoes, coastal high water, and heat waves. Rising temperature, for example, although enhanced in the Arctic, is not solely a high-latitude phenomenon. Recent scientific work shows that temperature anomalies during growing seasons and persistent droughts have hampered agricultural productivity and extended wildfire seasons. Persistent droughts during the past decade have also diminished flows in the Nile, Tigris-Euphrates, Niger, Amazon, and Mekong river basins.

Note: the head of our intelligence community seems to have missed that “persistent droughts” have not only diminished flows in the Nile, Tigris-Euphrates, Niger, Amazon, and Mekong river basins. Last year’s drought also diminished flows right here in the US, in the Missouri-Mississippi basin.

I guess somehow the US is exempt from climate change, intelligence folks?

I’m glad Clapper got climate change in his statement, I’m glad he put water and food scarcity at the front of his presentation (last year just water scarcity appeared in his written statement). But if we’re going to treat climate change merely as one underlying factor contributing to resource scarcity, perhaps we should also look at bankster speculation, which is increasingly recognized as a key driver of rising food costs. Food speculation, after all, is something we can do a great deal to fix, here in the US. But we have refused to do so, choosing instead to deal with the instability that results.

Ah well, baby steps, people. The Director of National Intelligence just implicitly said that climate change and resource scarcity is the most urgent problem facing us. I’ll take it.

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Carl Levin Takes on Tax Cheats and Dark Money in Retirement Statement

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Carl Levin, a pretty old but very healthy 78, but relatively young given MI’s very old Congressional delegation, announced his retirement today.

I don’t always agree with Levin. But he is one of the smartest, most effective (when he wants to be) Senators in the Senate. I will miss having him represent me in DC.

I expect Gary Peters will replace Levin.

I’m just as interested in how Levin will go out. Here’s most of his statement:

I have decided not to run for re-election in 2014.

This decision was extremely difficult because I love representing the people of Michigan in the U.S. Senate and fighting for the things that I believe are important to them.

As Barbara and I struggled with the question of whether I should run again, we focused on our belief that our country is at a crossroads that will determine our economic health and security for decades to come. We decided that I can best serve my state and nation by concentrating in the next two years on the challenging issues before us that I am in a position to help address; in other words, by doing my job without the distraction of campaigning for re-election.

Here are some of those issues. Years of bipartisan work by the Permanent Subcommittee on Investigations that I chair have shed light on tax avoidance schemes that are a major drain on our treasury. The huge loss of corporate tax receipts caused by the shift of U.S. corporate tax revenue to offshore tax havens is but one example of the egregious tax loopholes that we must end. Thirty of our most profitable companies paid no taxes over a recent three year period although they had over $150 billion in profits.

Tax avoidance schemes that have no economic justification or purpose other than to avoid paying taxes may be legal but they should not be. These schemes add hundreds of billions of dollars to the deficit. They lead to cuts in education, research, national security, law enforcement, infrastructure, food safety and other important investments in our nation. And they add to the tax burden of ordinary Americans who have to pick up the slack and accelerate the economic inequality in our country. I want to fight to bring an end to this unjustified drain on the Treasury.

Second, I want to ensure that the manufacturing renaissance that has led Michigan’s economic comeback continues. We’ve made progress in building the partnerships we need to help U.S. manufacturers succeed, but the next two years will be crucial to sustaining and building on that progress.

A third item I want to tackle is a growing blight on our political system that I believe I can help address: the use of secret money to fund political campaigns. Our tax laws are supposed to prevent secret contributions to tax exempt organizations for political purposes. My Permanent Subcommittee on Investigations needs to look into the failure of the IRS to enforce our tax laws and stem the flood of hundreds of millions of secret dollars flowing into our elections, eroding public confidence in our democracy.

Finally, the next two years will also be important in dealing with fiscal pressures on our military readiness. As Chairman of the Senate Armed Services Committee, I am determined to do all I can to address that issue. I also believe we need to pursue the rapid transfer of responsibility for Afghan security to the Afghans. And, as our troops come home, we must do a better job of caring for those who bear both the visible and invisible wounds of war.

These issues will have an enormous impact on the people of Michigan and the nation for years to come, and we need to confront them. I can think of no better way to spend the next two years than to devote all of my energy and attention to taking on these challenges.

Carl Levin has said his priorities in the next two years will include finding a way to tax the rich and prevent the rich from stealing our elections. Having made the decision he will not need those rich donors to fund his reelection, he will have significant flexibility to piss them off.

Levin has never been known to shy away from pissing people off in any case.

May Senator Levin go out in style, taking on those rich looters who are gutting our country.

 

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