Hossein-zadeh
is a profile in courage. He is a sixty-three-year-old native of
a Kurdish village in the mountains of Iran with less than four hundred
residents. One of six children, he miraculously graduated from Tehran
University and ventured to New York City to do his graduate work
with less than one hundred dollars in his pocket.

Hossein-zadeh
received his doctorate degree from the New School for Social Research.
He has taught economics at Drake University in Des Moines for over
two decades.

His most recent
book, now available in paperback, is both courageous and profound.
By his own admission, Hossein-zadeh knows little about the Austrian
School of economics and even less about this website. In fact, much
of the economic analysis in his book runs along Keynesian and even
Marxist-Leninist lines.

Yet, like
all great anti-war intellectuals, Hossein-zadeh's approach to the
subjects he discusses is inter-disciplinary with a heavy emphasis
on historical facts. Also, his book is full of quotes from names
LewRockwell.com readers will readily recognize: Chalmers Johnson,
Smedley Butler, Michael Scheuer, William Hartung, James Mann, Patrick
Buchanan, Robert Higgs and Lew Rockwell. Hossein-zadeh also quotes
Paul Craig Roberts several times in his book and during our lunch
he expressed his total admiration for Roberts' work — thus, the
title of this article.

When Hossein-zadeh
discusses American militarism, he talks less about a military-industrial
complex than he does a military-industrial parasite. Furthermore,
the military-industrial establishment in the United States isn't
even that complex an entity. It consists of an "iron triangle"
made up of civilian governors (the president, the congressional
oversight committees and so forth), professional personnel serving
in the military and the 85,000 private contractors who arm the military
machine and who profit mightily from their contributions to the
overall effort.

Looking back
through history, Hossein-zadeh notes that the Roman Empire used
its military to achieve economic, territorial and other ends. After
Julius Caesar crossed the Rubicon, however, the military establishment
undermined republican principles of civilian governance and ultimately
created a Roman military empire. Rome was transformed from a classic
economic empire into the first military-parasitic empire.

The British
Empire, like its Roman predecessor, started out as an economic empire
that used its military to conquer territories and force the transfer
of the resultant colonies' resources to England. But Britain's mercantilist
policies were expensive ones. Once these policies (which included
protectionism) helped England achieve international economic superiority,
Britain's colonial-administrative forces became a very costly redundancy.
The primary role of England's military became, after the last Corn
Laws were passed in 1848, to merely keep foreign lands and markets
open for free trade.

But Britain's
colonial military-administrative establishment — which was huge
— did not go quietly into the night. It took less than fifty years
after 1848 for France, Germany and the United States to threaten
England's temporary economic superiority. Britain's colonial military-administrative
forces reasserted themselves as England returned to its policies
of protectionism, militarism and colonialism. Military conflicts
inevitably ensued (e.g., the Boer War) which ultimately led to World
War I.

For the first
150 years of its existence, the United States used the military
to defend itself, protect its internal markets and to expand its
territory. Many wars were fought and the United States military
was expanded in each case to fight them. But unlike Rome and Britain,
prior to 1940 the United States always reduced its military to its
pre-war size.

At this point
in his narrative, Hossein-zadeh tells the fascinating story of how
the ruling elites in America worked through the Council on Foreign
Relations to convince Franklin Roosevelt and, subsequently, Harry
Truman that the United States must create a permanent military-economic
establishment to help plan for the future of the United States and
the international community after World War II. In this fascinating
chapter, Hossein-zadeh shares many facts such as the following:

1. FDR agreed
on November 28, 1941 to inform congress and the American people
that "if Japan attacked Singapore or the East Indies, the security
of the United States would be endangered and war might result."
At the time, a vast majority of Americans were not at all likely
to believe such a claim. On December 7, 1941 the Japanese attack
on Pearl Harbor took care of this problem for FDR.

2. By mid-1941,
before America entered World War II, FDR's outside brain trust concluded
that Germany could not possibly win the war after Hitler's foolish
invasion of Russia. They began to draw up the plans for a new economic-military-diplomatic
order before the United States entered the war. These plans were
later announced and adopted at Bretton Woods after the war.

3. In adherence
to these plans, Harry Truman remobilized the U.S. military beginning
in 1950 — in part to ward off a possible recession. As Hossein-zadeh
puts it, "Military spending rose — in constant (2002) dollar
— from $150 billion in 1950 (the last year of ephemeral postwar
demobilization) to $500 billion in 1953."

Hossein-zadeh
next traces the rise of parasitic-militarism through this period
up through the 1970s when the post-World War II consensus among
the nation's elites began to unravel. This part of the story includes
the "Nixon shocks" (e.g., his unilateral moves to abandon
the gold standard and impose new tariffs), to Jimmy Carter's transformation
from a Trilateralist to a militarist and Ronald Reagan's "second
Cold War."

But it is
the phase after the fall of the Berlin Wall that gets the most frightful
in Hossein-zadeh's telling. At that time, former defense secretary
Robert McNamara said the defense budget should be cut in half. The
Secretary of Defense at the time, Dick Cheney, said it should be
increased after the fall of the Soviet Union. Obviously, Cheney
and the military-industrial parasites have easily won the battle
over defense spending. The United States will probably spend at
least one trillion dollars a year on our military during the foreseeable
future.

Ismael Hossein-zadeh
has written a must-read book. His chapter on the real reasons for
the Iraq War — which have nothing to do with oil — are worth the
price of the book all by itself. He and Paul Craig Roberts come
from completely different direction philosophically. But they reach
the same conclusion: "Enough is enough."

September
5, 2009

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

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On October
13, 2008 the heads of our nation's five largest hedge funds were
summoned before a U.S. House committee headed by the inimitable
Henry Waxman. Although it initially appeared to be a "show
trial" in an almost Soviet sense of the term, the hearing surprisingly
turned into a rather informative affair.

A congressman
asked each of the hedge fund managers how their investment portfolios
could have thrived when most financial markets have been in total
disarray. One of the managers replied that he had shorted subprime
mortgage-backed securities after researching their underlying assets
diligently for months. His firm found that most of the mortgages
were issued with no down payments having been made, to parties with
bad credit histories and with virtually no documentation provided
(because none was required) to the lender. Their conclusion was
that most if not all of the mortgages would go into default, despite
the fact that "independent" rating agencies had deemed
as being investment grade — even declaring them AAA-rated in some
instances — the securities behind which these same mortgages stood
as collateral.

Unlike investment
banks, credit rating agencies and — now — Henry Paulson, this hedge
fund manager obviously did his homework. We can do a little of the
same for ourselves in order to come to grips with the financial
mess that has resulted by reading James Grant's new book, Mr.
Market Miscalculates.

After having
read the book twice during the past four days, I can say without
equivocation that it is a must-read item. Grant lays out on the
table almost all of the key pieces involved in the current credit
crisis that is enveloping the world, even though the last essay
was written late this spring. Fortunately, James Grant gives us
most of the last pieces of the puzzle in his op-ed, The Confidence
Game, which was published in the Wall Street Journal
on October 18, 2008. It, too, must be read in its entirety to be
fully appreciated.

Grant's basic
arguments involve the insight that interest rate cycles in the United
States take generations to complete and that we have now reached
the end of one of the greatest bull markets in debt securities of
all kinds that his country has ever seen. In his opinion, interest
rates can only go up from here over the next couple of decades.

But it is
the transition from falling interest rates to rising ones that is
shaking the foundations of the credit markets currently. For odd
and various historical reasons, since the early 1980s Americans
have seen the government, corporate and private debt that they have
incurred over the past twenty-five years lapped up in world markets
at ever lower interest rates and on increasingly better borrowing
terms for the debtors.

At
times this free flow of credit extended to the United States from
around the world has seemed indiscriminate. In Grant's view, this
lack of discrimination was most obvious at the tail end of the bull
market in debt securities he has been watching with a gimlet eye
for over twenty-five years. How else could one explain, he asks,
the fact that until at least halfway through 2007 securitized debt
derived from subprime home mortgages originated in the United States
could be priced to yield very little more than Treasury issues with
comparable implied maturity dates? How, indeed! In his recent Wall
Street Journal article, Grant comes very close to providing us with
the answer to his own query.

American debt
originated from a known source in this country — everywhere. But
from where was all the credit derived? Increasingly in recent years,
it has come from foreign countries and, especially, from emerging-market
nations in Asia and elsewhere.

Private exporters
in these foreign countries would take the dollars they obtained
through the trading of their goods sold in the United States to
their respective central banks and have the dollars redeemed for
local currencies. Since many more exports went to the United States
than did imports from America go to these countries, certain foreign
central banks accumulated huge surpluses of our currencies. Rather
than hold non-interest bearing dollars, these foreign central banks
purchased debt securities issued by American entities of virtually
all types.

As Grant puts
it, "Our foreign creditors accepted dollars in payment for
their goods and services — and then obligingly invested the same
dollars in America's own securities. It's as if the money never
left the 50 states." But it is important to note that most
of these securities were of the debt variety. And the central banks
of emerging market countries may not have been as indiscriminate
in their purchases of this debt as it might first have appeared.

The safest
debt that foreigners can buy is that issued directly by the U.S.
Treasury. As worldwide demand for this debt increased and yields
dropped, foreign creditors would naturally have looked — as they
did — to debt issued by government sponsored entities (e.g., Fannie
Mae and Freddie Mac) for its higher yields and implied U.S. Treasury
backing. Finally, these conservative debt investors began to consider
the purchase of investment-grade debt, particularly AAA-rated securities.

Due to America's
trade imbalances with the rest of the world, the demand for all
three kinds of debt (treasuries, GSE-related and investment-grade
securitized obligations) soared. Wall Street was more than happy
to try to meet this demand and did so until it got to the point
of creating "mortgage contraptions so complex as to baffle
even the people who invented them."

Unfortunately,
these "contraptions" gave new and dire meanings to the
phrase "the alchemy of finance" pioneered by George Soros
many years ago. The conjurer's trick in this case was to turn debt
that was decidedly not investment-grade (i.e., subprime mortgages
or, as Grant calls them, "junk mortgages") into AAA-rated
securities. Wall Street was only able to apparently do so by plugging
optimistic assumptions into complex computer models and then selling
the conclusions spit out as justifications for AAA investment ratings
provided for them by compliant rating agencies — all for big fees,
commissions and underwriting profits, of course.

As Wall Street
continued to push the envelope, additional assurances of the soundness
of these collateralized mortgage obligations (CDOs) began to be
demanded by creditors. Synthetic CDOs were created to add "insurance"
in the form of credit default swaps and the band played on for a
little while longer.

But then the
music stopped when subprime mortgages began to default and all the
participants in the game realized that there were not enough safe
seats for each of them to sit in. At this point, the Federal Reserve
and the United States Treasury intervened. First they secured Fannie
Mae and Freddie Mac by taking over ownership of them. Then they
purchased eighty percent of AIG, the largest issuer of credit default
swaps in the world. Finally, the U.S. Treasury has begun the process
of injecting $350 billion to $700 billion into the capital structures
of America's largest financial institutions.

You can read
all about the folly in Mr. Market Miscalculates and you should
probably weep while doing so. But James Grant writes too well, thinks
too clearly and is just too darn funny to distract one from the
narratives that make this book worth every penny it might cost you
to purchase it.

November
17, 2008

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

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While being
raised in rural Minnesota, we learned that "giving up the ghost"
meant some person or animal had died, was no more and had passed.
Today we are learning that this is no longer the case when the phrase
is used in conjunction with the animal known as "investing
banking" — at least in the minds of those who work on Wall
Street in New York City and on Pennsylvania Avenue in our nation's
capitol.

The best history
of the rise of investing banking in America is Ron Chernow's book,
The
House of Morgan. This chronology (voted in several polls
as one of the 100 best nonfiction books of the twentieth century)
of J.P. Morgan and the bank he left behind traces developments for
over one hundred years from the late nineteenth century onward.

At the beginning
of this financial era, there was a mismatch between America's opportunities
to grow its economy and the available capital in this country to
finance that growth. Most surplus capital at the time was in Europe
and J.P. Morgan took the lead in helping foreigners allocate this
scarce capital to America's most worthy railroads, manufacturers
and so forth during this timeframe.

Without people
like Morgan to pass judgment on America's emerging industries, money
from foreigners would simply not have been made available to fund
these enterprises. As a result, railroads and manufacturers made
repeated visits to America's investment banking houses — as opposed
to the bankers seeking them out — to argue why their businesses
were worthy of obtaining this capital.

Ron Chernow
recently summarized the role played by Morgan and his ilk in an
op-ed article he had publish in the September 28, 2008 edition of
the New York Times: "They rendered America an invaluable
service by reassuring European investors that they would receive
an adequate return on their investments, securing an uninterrupted
flow of capital" to this country at a time when our economy
sorely needed it.

The original
House of Morgan and other investment banks originally served only
the most creditworthy clients whether they were industrialized nations,
blue-chip corporations or millionaire families. The Glass-Steagall
Act of 1933 forced the full-service banks of the past to choose
between commercial and investment banking. The House of Morgan was
split, for example, into two separate entities — a commercial bank
(J.P. Morgan which later became Morgan Guaranty) and an investment
bank (Morgan-Stanley).

Most
of the capital from such splits, however, was retained by the commercial
banks. This was in no small part due to fact that the need for investment
banking services was so diminished during the Great Depression.

Although only
the "ghost of J.P. Morgan" in the form of thinly capitalized
investment banks survived World War II, they continued to exert
a near mystical influence in American finance far beyond their real
worth to the country's leading businesses. Companies like DuPont,
I.B.M., General Electric, United States Steel and General Motors
thrived in the initial decades after 1945 primarily because of the
devastation caused by the preceding war in Europe and Asia.

American companies
became so successful that they grew big enough to finance expansion
from their own retained earnings. As the United States — and, later,
the rest of the industrialized world — boomed, other borrowing options
that did not require the services of investment banking firms became
at first viable and then commonplace.

In the last
three decades prior to 2008, traditional underwriting services at
investment banks have been systematically replaced by ever more
volatile and risky businesses promoted by the remaining firms. Examples
of these enterprises have included increased trading activities
(for stocks, commodities and derivatives), hostile takeovers, leveraged
buyouts, junk bond issuances and prime brokerage services for hedge
funds. Rather than allocate investment capital as they once had,
investment banks had ever-greater needs to raise it for themselves
to finance one risky venture after another. Chernow says, "Where
the old Wall Street stuck to the most prestigious clients, the new
Wall Street engaged in an unseemly race to the bottom." How
low would they ultimately go? How about the packaging of subprime
mortgages (what James Grant of Grant's Interest Rate Observer
calls "junk mortgages") into collateralized debt obligations
(CDOs) rated AAA by friendly rating agencies?

Why "save"
Bear Stearns, Merrill Lynch and Morgan Stanley and/or subsidize
commercial banks to take them over? Who needs these clowns anymore?
Let them go the way of buggy whip manufacturers. They long ago stopped
serving their original useful purposes. Any important remaining
services they provide will be assumed by some other parties. Their
best talent will surely find employment elsewhere. Why cannot public
policymakers like Henry Paulson see these obvious facts? Oops! That's
right…Paulson was the head of one of those "leading" investment
firms at one time himself. And the fact that the head of Merrill
Lynch once worked for him might explain while that firm was bailed
out and Lehman Brothers was allowed to fail. So it goes.

November
13, 2008

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

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Federal
Reserve Study Paper #666

On October
23, 2008 the research department of the Federal Reserve Bank of
Minneapolis issued an important paper. Its title is "Facts
and Myths about the Financial Crisis of 2008."

The authors
of this paper do not dispute that the United States is going through
a financial crisis as witnessed by major financial institutions
having failed and the fact that various stock markets have fallen
dramatically. They strongly disagree, however, with the most widely
voiced claims about the nature of the crisis and the extent to which
the problems of the financial sector are spilling over to the rest
of the economy.

Four primary
claims have been made about the current crisis by financial institutions
themselves, public policymakers and the financial press, as follows:

1. Bank lending
   to nonfinancial corporations and to individuals have declined
   sharply.
2. Interbank
   lending is essentially nonexistent.
3. Commercial
   paper issuance by nonfinancial corporations has declined sharply
   and rates have risen to unprecedented levels.
4. Banks play
   a large role in channeling funds from savers to borrowers.

Using data
from the Federal Reserve Board itself through October 8, 2008 the
authors of this myth shattering paper vigorously dispute all four
of these claims. They show that aggregate bank credit has not declined
during the financial crisis and, in fact, that total bank credit
available actually increased in September of 2008.

Along the
same lines, the paper shows that loans and leases made by U.S. commercial
banks have not declined during the financial crisis nor have commercial
and industrial loans to nonfinancial businesses. Finally, data for
consumer loans highlighted in the paper show no evidence that the
financial crisis has affected consumer lending. All of the figures
cited prove that the first claim about the impact of the financial
crisis — bank lending of all kinds has declined sharply — is false.

Data found
in the paper regarding interbank loans by all U.S. commercial banks
demonstrate that "at least in the aggregate" interbank
lending is healthy and has not been adversely affected by the financial
crisis. Thus, the second claim made about its impact is false on
its face.

With respect
to the commercial paper market, the authors point to data that shows
that such issues by financial institutions have declined, mostly
because huge increases in customer deposits have lessened the needs
of banks to raise money in this way. On the other hand, commercial
paper issued by nonfinancial institutions has been essentially unchanged
during the financial crisis. Also, the authors maintain that interest
rates on commercial paper have "barely budged." The third
claim about the financial crisis — that the commercial paper market
has dried up and the interest rates on such issues have risen dramatically
— is a myth, to put a kind face on the nature of these claims.

Finally, the
paper explores the nature of bank lending to nonfinancial corporate
businesses and concludes that such lending does not constitute the
bulk of borrowing of these businesses. In the second quarter of
2008 direct bank lending to businesses totaled $1 trillion. Funds
obtained by nonfinancial corporate businesses through the issuance
of public corporate bonds, however, is currently four times as great
(at $4.5 trillion) as the total from direct bank lending to these
companies. Obviously, banks do not play the most major role in channeling
capital to businesses and the fourth claim about the nature of the
current financial crisis is proven to be false by this paper.

The authors
also discuss the abnormally high spread between Treasury bill interest
rates and those of short-term corporate debt issues. Since — as
we have seen — the latter interest rates have remained stable, the
spread is due to the historically low rates currently being paid
on treasury bills. If one compares, on the other hand, interest
rates paid on investment-grade corporate bonds to those paid on
Treasury bonds of similar maturities, the spreads between them has
remained at historic norms throughout the financial crisis. Once
the current panic over short-term interest rate spreads and so forth
subsides, Treasury bill interest rates can be expected to rise to
more normal levels.

So, if the
major claims about the impact of our country's financial crisis
are myths and/or lies, why all the panic? Do the financial institutions
most affected by the crisis (i.e., investment banking firms and
those commercial banks truly in trouble), public policymakers and
the financial press not know the facts or have they deliberately
kept them from the American people? Have we been stampeded into
the Panic of 2008 and, if so, why? Will some benefit much, much
more than others of us from this stampeding?

October
27, 2008

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

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Barack Obama was recruited to become a community organizer in Chicago twenty years ago. After three years of doing this work, Obama realized that he could have far more influence in Illinois if he pursued a career in politics as had Chicago's first black mayor, Harold Washington. In furtherance of this notion, Obama began to attend Harvard Law School.

During his third year at Harvard Law, Obama was offered a job by a Chicago real estate developer named Tony Rezko. Obama turned down this opportunity in order to become an attorney with the Davis, Miner and Barnhill law firm.

It was probably no coincidence that one of this firm's biggest clients was Tony Rezko. The firm's senior partner, Allison Davis, was also a power broker behind the rise of Harold Washington to the mayor's seat in the city of Chicago — again, probably no coincidence as far as Obama was concerned.

Allison Davis subsequently left his law firm in order to go into the real estate development business full-time. He became a 51% owner of DV Urban Realty Partners along with Robert Vanecko who owned the remaining 49% of the firm. Vanecko is Chicago Mayor Richard Daley's nephew. Two of Allison Davis' sons, Jared and Cullen, work with their father in the real estate business.

Davis and his associates have received more than $100 million in taxpayer subsidies to build and rehab apartments and houses in Chicago. They have also been paid over $4 million dollars in development fees. As Tim Novak, a Chicago Sun-Times reporter, noted in a November 7, 2007 article for his paper, "Davis has gotten deal after deal from the mayor, helping to make him one of the Chicago's top developers."

In 1993, the same year he was hired by Davis' law firm, Obama began serving on the board of Woods Fund, a Chicago charity foundation. After Allison Davis left his law firm, he went to the foundation for money and Obama voted to invest $1 million of the organization's assets in a Davis real estate partnership.

Ties such as those described above run rampant in the career of Barack Obama from 1993 to the present. Obama has a long history of working with Allison Davis, Tony Rezko, Mayor Daley and Illinois' Democratic governor, Rod Blagojevich, to obtain government funding for housing development in Chicago. Davis, Rezko, Daley and others have, in return, helped fund Obama's rise to political prominence. It has been classic, Chicago machine politics with the requirement that people "pay to play."

Without the funding from political Godfathers like Tony Rezko, Obama's career in politics would never have gotten off the ground. But without the aid of corrupt government officials, slumlords like Tony Rezko would never have made the money to contribute to politicians such Obama, Daley and Blagojevich in the first place.

U.S. Attorney Patrick Fitzgerald's Federal Indictment of Tony Rezko

The U.S. Attorney for Northern Illinois, Patrick Fitzgerald, has made quite a name for himself in recent years. He has successfully prosecuted Dick Cheney's former chief of staff, Scooter Libby, and former Illinois Republican governor, George Ryan, within the past year. Fitzgerald also convicted several former members of Mayor Daley's administration for "pervasive fraud" in city hiring practices. This spring he successfully concluded a trial against Tony Rezko, convicting him on corruption charges.

In Fitzgerald's indictment of Rezko, he lists eight persons that he refers to as "Co-Schemers." Virtually all of these people have been major contributors to the political campaigns of Barack Obama, Rod Blagojevish and Richard Daley.

Additionally, Fitzgerald's indictment makes specific references to Blagojevish and Obama. The governor is referred to as "Public Official A" and the senator is called a "political candidate."

The fact that Obama, Blagojevish and Daley are all mixed up together in the Rezko affair is not surprising. Favored politicians of both parties in Illinois are often joined at the hip when it comes to political fundraising. For example, a recent analysis done by the Chicago Tribune revealed that Obama has taken in more than $1.5 million dollars for his various campaigns from over seven hundred people who have also contributed to Mayor Daley's candidacies.

Fitzgerald's case against Rezko involved two state regulatory boards. One controls the Teachers Pension System (TPS) and the other, the Health Facilities Planning Board, reviews all proposals for construction projects that involve medical facilities in Illinois.

After Rod Blagojevish was elected governor of Illinois, the "Co-Schemers" stacked the TPS board so that favored investment firms were allowed to invest parts of the retirement fund's $30 billion in assets. The "Co-Schemers" then demanded kick-backs and worked to funnel money into the political organizations of Blagojevish and Obama.

Next the "Co-Schemers" worked to reduce the Health Facilities Planning Board from fifteen members to nine members. Subsequently, they proceeded to stack the board with a bloc of five members that would guarantee them a majority. Three doctors, Imad Amanaseer, Michel Malek and Fortunee Massuda, were named new members in order to secure the necessary majority votes. All three became large contributors to the various campaigns of Barack Obama from this point forward.

On April 21, 2004 the Health Facilities Planning Board approved the building of a new hospital in Crystal Lake, Illinois even though state analysts had said the new facility was not needed. The builder of the hospital, Jacob Kiferbaum, was to have paid bribes to those who made the construction of the hospital possible. The hospital was never built because Fitzgerald's investigators blew the case wide open and even secured a guilty plea from Kiferbaum who is now cooperating with the Feds. Throughout much of this time, Barack Obama was the chairman of the Senate Committee on Health and Human Services and was copied in on e-mails and other correspondence regarding these matters.

The Trial of Tony Rezko

At the recently concluded trial of Tony Rezko, the star witness for the prosecution was a Chicago businessman named Stuart Levine. This individual sat on the board that controls the TPS and the Health Facilities Planning Board. He testified that Tom Rosenberg's investment firm, Capri Capital Advisors, was to have received approval to invest a total of $320 million of TPS assets in exchange for a $500,000 kickback to Levine and $1.5 million in political contributions to Governor Blagojevish. Rosenberg was also a producer of Hollywood films and was so close to Allison Davis on a personal level that he had Davis make a cameo appearance in one of his movies.

Obama also has strong ties to investment companies that seek to do business with the state of Illinois. Once the Democrats took over the state legislature in 2003, Obama was assigned to an Illinois senate committee that began looking into public retirement plan matters. Four firms with close relationships with Obama were subsequently awarded hundreds of millions of new dollars to invest on behalf of these plans. Executives of these firms helped raise $300,000 for Obama's U.S. senate seat race in 2004 and even more money for his presidential campaign.

The Daley-Obama Machine

Mayor Richard Daley's office hired Michelle Obama as an assistant to his chief of staff, Valerie Jarrett, in 1991. Daley later appointed Jarrett chairperson of the Office of Planning and Development where Michelle became her assistant.

Today Jarrett is the CEO at Habitat, a real estate development and management firm. It manages the housing program for the Chicago Housing Authority. Jarrett was also a member of Obama's U.S. Senate Finance Committee in 2004 along with Tony Rezko, Rita Rezko and Allison Davis. Jarrett currently serves as an advisor to Obama's presidential campaign.

Kirk W. Tofte [send him mail] is the manager of the BWIA Private Investment Fund and the author of Be Principled and Grow Rich: Your Guide to Investing Successfully in Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk W. Tofte Archives

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The struggle
between Hillary Clinton and Barack Obama for the Democratic Party's
presidential nomination was an epic one. It will undoubtedly spawn
a book or two about the contest. The following are some suggested
titles that a few acquaintances of mine and I have come up with
for such a tome:

• Hillary
  Shrugged
• Hillary's
  Complaint
• Hillary's
  End
• Obama and
  the Art of Media Manipulation
• The Obamabots
  Guide to the Galaxy
• The Wright
  Stuff
• The Legend
  of Deeply Hollow
• No Country
  for Older Women
• Invasion
  of the Caucus Snatchers
• Invasion
  of the Delegate Snatchers
• Take the
  Misogyny and Run
• How Green
  Was My Candidate
• A Man for
  All Political Leanings
• I, Obama
• Obamabi
  the Dick
• Weathering
  Slights
• As I Lay
  Spying
• Axelrod's
  Fables
• Raging
  Bullshit
• The Silence
  of the Superdelegates
• Origin
  of the Specious
• Jesse Jackson
  and the Chocolate Nut Factory
• Dude Be
  Not Proud
• The Hijacker's
  Guide to the White House
• Swindler's
  List
• Kill Bill
  Vol. 3
• Sense and
  Insensitivity
• For Whom
  the Bots Toll
• For Whom
  the Bots Troll
• Something
  Mulatto This Way Comes
• Grim Fairy
  Tales
• Faith of
  My Pflegers
• Blazing
  Straddles
• La Bouge
  et le Noir
• The Count
  of Monte Schizo
• Big Two-Faced
  Liar
• Gone Changin'
  With the Wind
• War and
  Race
• Field of
  Schemes
• The Lyin'
  King
• The Red
  Badge of Race Baiting
• Belittle
  Women
• Barack
  the Obscure
• The Bible
  (King Obama Version)

July
30, 2008

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

DIGG THIS

Over the past
weekend the third annual convening of dailykos.com activists took
place in Austin, Texas. The group is now calling itself "Netroots
Nation." Attendance was significant and those who came to fawn
before their blog masters included Nancy Pelosi, Al Gore and Bob
Barr.

Bob Barr?
What was the Libertarian candidate for president doing at a meeting
such as this one? Why seeking support, of course, from the many
at dailykos.com (including the web site's founder) who describe
themselves as "libertarian progressives."

Acute ideological
confusion is one of four reasons why Barack Obama is the perfect
candidate for the Netroots nation. A candidate who cannot define
himself is a perfect fit with a political movement that is totally
confused about its own identity.

Before trying
to clarify this point, the other three reasons why Obama is the
perfect candidate for visitors to dailykos.com, huffingtonpost.com
and so forth should be outlined. First of all, Obama qualifies on
generational grounds. The vast majority of blog activists are younger
than Obama.

Secondly,
Obama is a male. If one were to have gone to the first two annual
kos meetings held in 2006 and 2007, one would have been overwhelmed
by the young males in attendance. Finally, the vast majority of
these young males are white — a dream come true for a candidate
who works so hard to get whites behind him in background crowds
as opposed to other demographic groups such as, say, blacks or Muslims.

But if the
three most important things about any real estate market are "location,
location, location" then the three most crucial aspects of
Obama's candidacy are "ideology, ideology, ideology."
Sort of.

We are finding
out that Obama's ideological leanings are — like oil in the world's
vast global markets — fungible. Just as different countries and
differing economies have various needs for oil, Obama supporters
need to be able to see in their candidate what they want to see.
And does he ever oblige them.

When the Netroots
nation was up in arms about the FISA reform bill working its way
through congress during the primary season, Obama vowed to filibuster
it if it contained immunity for telecommunications companies. We
saw the Libertarian Progressives go to their battle stations. But
when Obama completely reversed himself after "sewing up"
the Democratic nomination for president, the kos community went
back to their day jobs with very little being said, at least according
to the Great Kos himself on a television interview he did for MSNBC
last Friday.

Neither are
these weak-kneed progressives worried any more about the public
financing of political campaigns. As long as their candidate can
raise more money privately than his evil opponent, who really cares,
anyway?

The ancestors
to the Netroots Nation are the knee-jerk liberals of the Democratic
Party's sorry past. Bill Clinton saved the party from this wing
— and itself — in the 1990s with his "Third Way" approach
to politics. The Kennedys, Kerrys and their ilk never got over this
fact. They sought redemption this year through an unholy alliance
between themselves, the Netroots Nation and the Obama campaign.

But what do
unreconstructed Liberals have to do with Progressives, let alone
Libertarians? Almost nothing, really. The original progressive movement
was defined by Teddy Roosevelt and employed elements such as an
interventionist foreign policy and working with large financial
and industrial interests to reshape the U.S. economy — progressive
era "reforms" were almost all written by interests that
represented J.P. Morgan, John D. Rockefeller and so forth. The Federal
Reserve was created, for example, to make the world safer for private
bankers — as we've seen in spades again recently.

Libertarianism
stems from the Republican reaction against both progressivism and
the rise of a truly national Democratic Party. It has always promoted
individual liberty, free markets, little or no government interference
in the economy and a noninterventionist — if not isolationist —
foreign policy. The most consistent anti-war element in American
politics for decades has been the libertarian community. They believe,
correctly, that Ralph Bourne was right when he said that, "War
is the health of the state."

About the
only thing liberalism shares in common with libertarianism is a
belief that people should be left alone to pursue whatever lifestyles
and associations that they chose. You cannot be a libertarian and
support national health insurance as well as huge increases in government
spending (whether it's on the military, infrastructure, schools,
income transfers or what have you). And if you are going to spend
the money, you ought to raise enough in tax revenues to pay for
it. Even "tax and spend" policies are better than "borrow
and spend" approaches. With the former, you pay the costs only
one time as opposed to over and over again through interest on public
debt before it has to be repaid — or, what's more likely, refinanced.

Where does
Barack Obama fit on the Liberal-Progressive-Libertarian continuum?
Here, there and everywhere, of course!

Like all true
libertarians, Obama opposed the war on Iraq but voted to fund it
every time he had an opportunity to do so. Like the vast majority
of liberals he was against the surge, but this week benefited from
the security it has brought to Iraq which allowed him to meet with
that country's leaders in safety. Obama will withdraw troops from
Iraq within sixteen months of his inauguration (or not, depending
— like Bush and McCain – upon the facts on the ground) but will
send many of those soldiers to Afghanistan, just as Teddy Roosevelt
might have done under similar circumstances.

Like Republican
national leaders of the recent past, Obama will try to borrow and
spend the country's way to prosperity if elected. He said a few
weeks ago that balancing the budget is no longer a priority for
him. But he will tax and spend, as well. It will be "guns,
butter and supply-side economics" all rolled up in one ungodly
ideological stew. Unfortunately, this unseemly concoction will not
be served up to just the participants at future gatherings of the
Networks Nation. We're all going to get severe indigestion from
it for years after an Obama inauguration, should there be one.

July
28, 2008

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

DIGG THIS

I
have never really believed the old saying from the 1960s that the
"medium is the message." But there can be no doubt that
some media is better than others for driving home certain points.

What I am
referring to is the influence good television documentaries can
have in general and the overwhelming power, in particular, of the
Bill Moyers' piece called "Buying
the War" that aired on PBS last Wednesday night. This is
a long overdue look at the way the main street media bought with
virtually no reservations the "case" for war that was
sold through them to the American people by the Bush administration
beginning soon after September 11, 2001.

Moyers and
his production team brilliantly retell the story of Bush's push
for a war on Iraq. They mix well-known footage from the days, weeks
and months leading up to "shock and awe" with tales of
how the establishment media accepted the awful schlock they were
being sold with no questions asked on their part.

It is all
there to painfully remind us of how the sale was orchestrated:

1. References
   to Richard Clarke's recollections in Against
   All Enemies of Bush pressing him to review the "intelligence"
   regarding Iraq's involvement in the terrorist attacks on New
   York and Washington.

2. A copy
   of the internal defense department memo of the same time ordering
   personnel to "sweep it all up" and "go massive"
   with searches for ties between Iraq, weapons of mass destruction
   and terrorist groups.

3. Excerpts
   from Dick Cheney's August of 2002 speech before a veterans'
   group declaring that Iraq was near to reconstituting its nuclear
   weapons program.

4. Notation
   of Andy Card's famous remark that "you don't start selling"
   a new product in a big way until after Labor Day.

5. The appearances
   of Bush administration officials on the Sunday talk shows the
   very morning that Judith Miller's exclusive investigative report
   on Iraq's search for aluminum tubes and uranium with which to
   manufacture nuclear bombs was published in the New York Times.

6. Clips
   of Condi Rice, Bush and others warning that the "smoking
   gun could come in the form of a mushroom cloud."

7. The recitation
   of (what now can only be called the laughable) arguments Colin
   Powell made before the United Nations just weeks prior to our
   invasion of Iraq.

8. Excerpts
   from Bush's last press conference before the war which include
   his constant references to its scripted nature.

But these
elements of the documentary manufacture only singles, doubles and
triples. The home runs (some of them grand slams) come when Moyers
interviews media heavyweights about their role in this tragic matter.

Two players,
Dan Rather and Tim Russert, come off as tremendously diminished
and even pathetic under the lights Moyers shines on them. Russert
laments that none of his renowned sources had called him to warn
him off the claim that the aluminum tubes constantly sited by the
administration were suitable for use in the production of nuclear
weapons. Moyers then refers to Bob Simon of CBS News and comments
that he didn't wait for such calls to come in from his sources but
made inquiries on his own. Simon goes on to relate how simple it
was to uncover the hoax.

Rather talks
about the tremendous — largely unnamed — new pressures that journalists
(as compared, say, to those patrolling the streets of Baghdad?)
face today. He also talks about how very, very hard the work of
being a journalist is but fails to mention how large the rewards,
both financial and otherwise, have been for Russert, him and others
of their ilk. Rather sounds like Bush when he talks about how hard
the jobs needing to be done by them are to do. To him given much,
apparently, little or nothing can be expected.

But at least
Rather and Russert were willing to appear on the show. The same
can not be said for Judith Miller, Bill Kristol, Roger Ailes and
many other journalists who beat the drums for war but refused Moyers'
invitations to defend their work that led to the catastrophe that
is Iraq today.

Another highlight
of the documentary is the interviews Moyer conducted with Knight-Ridder's
wonderful journalists and independent thinkers like Norman Solomon.
The latter is the author of War
Made Easy which is a very important book on related subjects
that was reviewed on this web site over a year ago.

Missing, however,
from Moyers' discussion was much or any reference to the work that
could have been found on the Internet prior to the invasion of Iraq.
This web site, antiwar.com and other important venues should have
been recognized for the work that they did and the information that
they made available — much of it from the foreign press — to their
readers at the time. If viewers of Fox News were and still are the
most likely to believe Iraq was involved in some way with the events
of 9-11, regular users of the Internet sites listed above were and
are the most skeptical of Bush administration claims regarding American
foreign policy in general and the war on terrorism in particular.
And, I might add, good for us and God Bless these nontraditional
sources of information regarding current affairs.

Decades ago
CBS News did a documentary called "Harvest of Shame" about
the terrible living conditions faced by migrant farm workers in
the United States. One can only wish it were true that shame was
the lone harvest to come from the war on Iraq. Unfortunately, the
shame reaped by the main street media and others in this instance
was a product of and is in addition to the senseless death and relentless
destruction that has followed in this war's shockingly awful wake.

April
28, 2007

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

Yet when it comes to their anti-war activism of many decades, Rockwell
and Chomsky are brothers in arms – or should we say, "brothers
against arms." Reading Chomsky's new book, Imperial
Ambitions, is like dumping two shots of espresso into a
cup of lewrockwell.com's morning coffee.

Imperial
Ambitions contains nine transcripts of interviews with Noam
Chomsky conducted by David Barsamain from March of 2003 through
February of this year. They are delightful reads and convey the
quintessential Chomsky – informed, committed, brilliant, humorous
and hopeful.

As an aside, it should be noted that the interview approach is a
wonderful way to format the essence of the writings and activism
of Chomsky in a way that makes it easier to comprehend his overall
thinking. Wouldn't the American public benefit as much by reading
a book that utilized transcriptions of similar interviews with Lew
Rockwell? And if the interviews focused on why war is the health
of the State, couldn't they reach an audience – even, perhaps, worldwide – that
would not normally read libertarian writings? This could be a straightforward
project that would increase awareness of Lew Rockwell's tireless
work and help to raise money for his causes.

Noam Chomsky is a renowned professor of linguistics at MIT and has
been a principled anti-war activist since the early 1960s. His political
writings and activities are less well known than they otherwise
would be due, in no small part, to his being Jewish at the same
time he has taken consistent stands against the policies of Israel
in the Middle East.

Perhaps because of his combined – and unique – professional
and activist background, Chomsky has profound insights into the
use of propaganda by the State throughout history. In fact, his
decades-old book, Manufacturing
Consent, is a classic in this field of study.

Chomsky maintains that it is primarily in free societies where propaganda
is most useful and, in fact, needful. When a government cannot readily
turn to the use of force to control its people, it must resort to
more subtle means to influence their behavior.

Propaganda as we know it today stems largely from Britain's original
Ministry of Information that worked assiduously during World War
I to draw the United States into that conflict. In reciting this
history Chomsky says, "Britain needed U.S. backing for the
war, and the ministry's planners thought if they could convince
American intellectuals (emphasis added) of the nobility of
the British War effort, then these intellectuals would succeed in
driving the basically pacifist population of the United States – which
wanted nothing to do with European wars, rightly – into a fit of hysteria
the would get them to join the war…The British plan succeeded brilliantly
(as Ralph Bourne noted) with liberal American intellectuals.

People in the John Dewey circle, for example, took pride in the
fact that for the first time in history, as they saw it, war-time
fervor was created not by military leaders and politicians but by
the more responsible, serious members of the community – namely,
thoughtful intellectuals. In fact, the propaganda campaign succeeded
within a few months (again, emphasis added) in turning a
relatively pacifist population into raving anti-German fanatics.
The country was driven into hysteria."

Government propaganda works best – for the State, that is – when it
makes its citizens afraid. In the United States this time-tested
technique has been utilized by all of our presidents since at least
Harry Truman. Chomsky cites three examples from the presidencies
of John Kennedy, Ronald Reagan and our current Liar-in-Chief, George
W. Bush. These examples are insightful and ridiculous at the same
time. They would be mostly humorous in their absurdity if what they
led to were not so evil and dangerous.

In the 1960s Kennedy attempted to convince Latin America that Cuba
was a security threat to North and South America in general and
the United States, in particular. The Mexican ambassador to the
U.S. at the time called Kennedy's bluff by saying, "If we publicly
declare that Cuba is a threat to our security, forty million Mexicans
will die laughing." Yet Kennedy was able to convince Americans
of such a threat and this ultimately led to the brink of a nuclear
war during the Cuban Missile Crisis – no laughing matter, that.

Chomsky describes the crude propaganda arts of the Reagan administration
twenty years later in this way: "On May 1, 1985 Reagan declared
a national emergency in the United States because of the threat
to the security of the United States posed by the government of
Nicaragua, which was two days' drive (through – I would note – at least
one other country, Mexico, many times its size) from Harlingen,
Texas and was planning to take over the hemisphere. If you take
a look at that Executive Order, which was renewed annually as a
way of building up support for the U.S. war in Nicaragua, it has
almost the same wording as the 2002 congressional declaration on
Iraq. Just replace Nicaragua with Iraq."

Chomsky then asks, "How much critical intelligence does it
take to determine how much of a threat Nicaragua was to the existence
of the United States?"

Roughly another twenty years later yet, we are brought to the drumbeat
for war on Iraq that was begun by the Bush administration in September
of 2002. This propaganda campaign had two main themes:

1. Iraq was
   an imminent and direct threat to the security of the
   United States.
2. Iraq (it
   was at least insinuated) was behind the attacks in the U.S.
   of September 11.

How successful was this propaganda campaign? Chomsky describes its
efficacy by citing public opinion polls taken before and after it
began. He notes "that they reflected the impact of propaganda
very directly. Right after September 11 the percentage of the U.S.
population that thought that Iraq was involved (on September 11)
was, I think, 3 percent. By now (April 5, 2003) about half the population
believes that Iraq is a threat to our security. These attitudes
are closely correlated to support for the war."

It is obvious that Americans have nothing to fear but fear mongers
themselves. Or as Chomsky might ask, "How much critical thinking
and analysis does it take determine how much of a direct security
threat Afghanistan, Iraq, Iran, Syria and so forth are to a country
that possesses the most powerful military in the history of the
world, is bounded by two vast oceans and is bordered by two very
peaceful neighbors?"

October
12, 2005

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

For example, Scheuer puts the question of "Why do they hate
us?" into its proper historical context. The people of the
Soviet Union could have asked the same question about "the
mujahideen" who fought them so tenaciously and successfully
in Afghanistan two decades ago.

And perhaps the people of the Soviet Union heard from their leaders
at that time the same false explanations that Americans are being
told today by our leaders: "They hate us for who we are and
what we stand for." But the Europeanism, communism and even
the atheism of the Soviet people were never of any concern to the
ethnically and linguistically diverse Muslim insurgent groups that
defeated the Soviet Union in the 1990s.

The mujahideen hated the Soviet people because they had attacked
the three things Muslims love most – their faith, their brethren and
their land. These Muslims fought to keep the Soviet Union from usurping
Islam in Afghanistan, from killing fellow Muslims and from physically
destroying a Muslim country.

In other words, the mujahideen hated the Soviet people not for who
they were but for what they had done. Its current war against the
United States, Scheuer maintains, is the Afghan war of twenty years
ago "writ large."

Scheuer next asks the question "Is it possible that Muslims
perceive the U.S. actions in the Islamic world in a manner like
that with which they perceived the Soviet actions in Afghanistan?"
He then responds to his own question by saying that, "the objective
answer must be yes."

In the eyes of most Muslims, America invaded, now occupies and effectively
rules the Muslim states of Afghanistan and Iraq. The United States
has also continuously and invariably backed Israel's occupation
of Muslim Palestine.

America helped the United Nations create a new Christian state,
East Timor, in Muslim Indonesia. Yet such independence is taboo
for Muslim Kashmir, Muslim Chechnya and Muslim Bosnia. Furthermore,
U.S. policy supports "oppression and aggression by Hindu India
in Kashmir, Catholic Filipinos in Mindanao, Orthodox Christian Russians
in Chechnya and Chinese communists in Xinjiang Province." America
also supports "apostate" Islamic governments in Kuwait,
the UAE, Egypt, Jordan, Saudi Arabia and elsewhere.

The United States has imposed economic and military sanctions on
Muslims in Iraq, Syria, Sudan, Afghanistan, Libya, Pakistan, Iran
and Indonesia. These actions have led to the deaths of thousands
of Muslims, many if not most of whom were children.

In the case of Pakistan, the sanctions were imposed after that country
developed a nuclear weapon. Yet in two countries where Muslims are
in the minority – India and Israel – sanctions were never led or even
suggested by the United States when those nations developed similar
nuclear weapons.

Osama bin Laden is seen by most Muslims as leading a defensive jihad
to rid the Islamic world of the United States and its allies, just
as he helped lead the same kind of insurgency against the Soviets
in Afghanistan. Although the United States is the focal point of
this jihad, bin Laden and his followers have never expressed a desire
to occupy and rule countries other than Islamic ones. In other words,
they are over here because we are over there.

When put into this context, Islamic attacks on America can no longer
be seen as acts of terrorism. They are acts of war and parts of
the long battle Islamic jihadists intend to wage against the United
States until they achieve their military and political objectives.

How long can such a battle be waged? Again, if the Afghan War against
the Soviet Union is a precursor, this war will be waged until one
side or the other is utterly defeated. The Soviets conduct in Afghanistan
was incredibly brutal. The number of Afghans killed, wounded or
exiled was enormous. Scheuer claims that, in proportionate terms,
the Soviets inflicted more damage in Afghanistan than the Germans
caused in the Soviet Union during World War II.

Yet the Soviet Union lost their war in Afghanistan. Islamic jihadists
were willing to do whatever it took and use any weapons made available
to them in order to defeat the outsiders who they saw attacking
their religion, brethren and land.

Why should Americans expect those who continue to be led by Osama
bin Laden – as well as his tens of thousands of new followers – to be
any less committed to defeating the United States? We should be
prepared for Islamic jihadists to do whatever it takes and use any
weapons made available to them (including nuclear weapons and other
instruments of mass destruction) to defeat America as they did the
Soviet Union in Afghanistan.

What, if anything, can be done about this horrendous situation?
Scheuer suggests two alternatives: America can change its failed
and counterproductive foreign policies or it must wage total war
on Osama bin Laden and his Muslim followers in Islamic countries
occupied by over a billion people. Since there is never any shortage
of Americans ready and willing to instigate and support the second
alternative, some of the rest of us might consider working to actualize
Scheuer's first choice.

September
19, 2005

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Kirk
W. Tofte Archives

In his revealing new book, War
Made Easy, Norman Solomon documents the misdeeds and lies
that have led the United States into wars over the last five or
six decades. Solomon, a noted political and media critic, also provides
us with useful guidelines to distinguish propaganda elements that
have consistently been used to convince the American people to support
and sustain our nation's war-making efforts.

The following is a list (comprised of many titles of the book's
chapters) of arguments that we can nearly always expect to hear
each time the drums for war begin to be beaten in our nation's capitol:

1. America
   is a Fair and Noble Superpower
2. Our Leaders
   Will Do Everything They Can to Avoid War
3. Our Leaders
   Would Never Tell Us Outright Lies
4. They Are
   the Aggressors, Not Us
5. Opposing
   the War Means Siding with the Enemy
6. This Is
   a Necessary Battle in the War on Terrorism
7. Our Soldiers
   Are Heroes, Theirs Are Inhumane
8. America
   Needs the Resolve to Kick the "Vietnam Syndrome"
9. Withdrawal
   Would Cripple U.S. Credibility

War
Made Easy also discusses the things we are not likely to see
when the clouds of war begin to gather. These include the reality
that the last parties who will tell us that a war is wrong are members
of Congress and most elements of the major media in our country.

Solomon's book is filled with accurate analysis and many quotes
that are right on the money. One of his most important insights
deals with the fact that after Harry Truman took the U.S. into the
Korean conflict, every American military misadventure since has
been driven by the desires of our presidents to wage war for their
own purposes under our nation's flag and in our names.

In the book's prologue the author puts it this way, "Intense
public controversy may precede the onset of warfare, but the modern
historical record is clear: No matter what the Constitution says,
in actual practice the president has the whip hand when it comes
to military deployments – and if a president really wants a
war, he'll get one…When the president of the United States is determined
to go to war, a vast array of leverage and public-relations acumen
can and will be brought to bear."

Many of Solomon's anecdotal quotes are quite chilling. For example,
on April 25, 1972 the White House taping system recorded the following
conversation between Ron Ziegler, Henry Kissinger and Richard Nixon:

Nixon:
"How many did we kill in Laos?"

Ziegler:
"Maybe ten thousand – fifteen?"

Kissinger:
In the Laotian thing, we killed about ten, fifteen…"

Nixon:
"See, the attack in the North that we have in mind…power plants,
whatever's left
– petroleum, the docks…And I still think we ought to take the
dikes out now. Will
that drown people?"

Kissinger:
"About two hundred thousand people."

Nixon:
"No, no, no…I'd rather use the nuclear bomb. Have you got
that, Henry?"

Kissinger:
"That, I think, would just be too much."

Nixon:
"The nuclear bomb, does that bother you?…I just want
you to think big, Henry,
for Christsakes."

Later in his book, Solomon quotes ABC's Nightline reporter,
John Donovan, on what he saw in Iraq two years ago as a "non-imbedded"
reporter where he observed, "the close-up view of collateral
damage. The U.S. says it's trying to limit injuries to civilians.
It is, however, hard not to take it personally when that collateral
damage is you." Donovan then reported on a wounded Iraqi man
who had just lost his wife during the war, "She was collateral
damage. So were his two brothers. So were his two children."

Finally, Solomon reprints the following story that first appeared
in the National Journal: "On April 19, 2003, a little
girl walked out of a crowd in Baghdad carrying a steel gray canister
attached to a white ribbon. U.S. troops had left the canister behind
in her part of town, and she was trying to return it to the American
soldiers then on patrol. Sgt. Troy Jenkins, 25, a big man with blue
eyes, recognized the child's gift as a cluster bomblet, one of the
hundreds of thousands left dotting the country, and he threw himself
onto it as the explosion began. When the dying was over a family
in California had lost its father and a family in Iraq had lost
its daughter."

This story appears in the book's fourteenth chapter, "The Pentagon
Fights Wars as Humanely as Possible." Solomon follows up this
passage with a discussion of the more than two million cluster bomblets
dropped (so far) on Iraq. He states that at least "300,000
tiny bombs…(duds)…are waiting" for children, farmers and other
innocent Iraqis to "nudge them the wrong way" tomorrow
or ten years from tomorrow.

As concerned American citizens we must do all we can to expose the
war on Iraq for that it always has been. Along with Cindy Sheehan,
we must ask the question, "Who will be the last person killed
for a lie?"

But we must also work to not allow "wars to be made easy"
to conduct in the future. One of the best ways to begin such an
effort is to read Norman Solomon's important and useful new book.

August
19, 2005

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

This represents the latest victory of sorts for that group of our
citizenry that has coalesced under the banner of the "Moral
Majority." The purpose of this essay is to argue for another
coalition of people to represent a heretofore-submerged "Moral
Minority" in America today.

As a Christian I look to the Gospel and the teachings of Jesus as
my moral compass. And if the New Testament is clear about anything,
it is that in most times and in most places those who practice the
morality espoused by Jesus have been and are in the distinct minority.

This fact is a persistent subtext within many of Christ's parables.
After all, several people passed by the man in the ditch before
the Good Samaritan stopped to help him. Even more telling in terms
of minority participation is the fact that only one of the ten lepers
that Jesus healed returned to thank him.

It is my belief that a Moral Minority is ready to coalesce under
principles such as those listed below. It is also my belief that
these principles are grounded in the Christian faith. People of
the Jewish faith and other faiths are invited to add their moral
perspectives. Even secularists – at least a few of which, it is supposed,
might have moral insights – should feel free to contribute their thoughts.

A Moral Minority in America today could stand for the following:

Changing
people's hearts. In the seventh chapter of the Gospel of Mark,
Jesus notes that the world is and always has been polluted with
immoralities. He mentions among these obscenities, lusts, murders,
adulteries, depravity and carousing. But look what Jesus also lists
in this category: thefts, greed, deceptive dealings, mean looks,
slander, arrogance and foolishness.

Jesus goes on to maintain that all immorality flows from what is
in the hearts of human beings. We must do all we can to change hearts – beginning
with our own – to create truly moral societies and governments.

Honoring
the aged. Helping our elders to age with dignity, independence
and grace is a widely recognized moral imperative. Most of us have
been taught from an early age to honor our fathers and mothers.
The best way to do so (whether our fathers and mothers are living
or dead) is to help – in their names – those in need and less fortunate
than us.

Nurturing
the young. Jesus rebuked his disciples for attempting to turn
children away from him. Jesus said that those adults with outlooks
as innocent and hopeful as children would comprise the Kingdom of
God. It is not good enough for our society to make feeble attempts
at leaving no children behind. We must seek out and embrace all
of America's children in whatever ways we can because they represent
our society's future salvation.

Abortion is without question one of the greatest moral issues of
our time. But it is painful to watch so many who are "pro life"
act as though they are really just "pro birth." In other
words, it is as important that we protect and promote a life after
it is born as before it is born.

Helping
those in need. The aged make up those of us who are living in
the "dusk of their lives." Children represent those among
us living in the "dawn of their lives." The third group
in need of our constant attention and assistance consists of those
who are living in the "shadows of their lives." Among
these are the poor, the disabled, the imprisoned and the outcast.

Jesus instructs us to give drink to the thirsty, food to the hungry
and to both visit and comfort those in prison. After all, it is
the same as giving drink, food and comfort to him.

Seeking
the outcast. It is not only those in prison that are outcasts
in our society. One of the greatest moral sins is a belief in one's
own moral superiority. We are all God's children and must seek each
other out in the hopes of creating a more humble – as well as moral – America.

Blessing
the peacemakers. Over 2,000 years after the birth of Christ
the world has never had more pruning hooks turned into swords and
plowshares turned into shields. As Dwight D. Eisenhower said when
he warned us about the military-industrial complex, dollars spent
on excessive armaments take money away from education, healthcare
and other social needs. This is to say nothing of the death and
destruction they cause when used. Over forty years later, isn't
it about time we listened to one of our greatest generals and began
to question the morality of the excessive militarism that pervades
our society?

Neither
borrowers nor lenders be. We have replaced the "tax and
spend" policies of the New Deal and Great Society eras with
the "borrow and spend" policies of the supply-side economic
age. It is as immoral to leave the bills for our spending to future
generations as it is to be poor stewards of the land, water and
skies that we will pass on to those same generations.

These are just a few of the principles around which a new Moral
Minority can gather. Would anyone be interested in signing up?

January
19, 2005

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

In order to more fully understand America's movement toward and
open admittance of its renewed nationalism, militarism and imperialism,
it is important to look for "first causes." In his 2004
book, Myths
America Lives By, Richard T. Hughes does some "heavy
lifting" in this regard on our behalf.

Hughes, a Distinguished Professor of Religion at Pepperdine University,
argues persuasively that America's recent foreign policy misadventures
did not begin or end with the mendacious activities of the neoconservative
cabal surrounding the Bush administration. These calamitous policies
have far too much support among the American people in general for
us to so easily and totally blame them on such a sorry lot of pseudo-intellectuals
as the neoconservatives. Hughes – like Walt Kelly's cartoon character,
Pogo – has seen the real enemy and "it is us."

Hughes instructs us that the English word myth is derived
from the Greek word mythos, which literally means "story."
Our national myths become, then, the stories that we Americans tell
ourselves about the history, meaning, purpose and destiny of our
country. Although almost all of these stories are accepted with
blind faith (and, largely, in an unconscious manner), some are much
more grounded in reality, history and truth than others.

Perhaps the best example of what Hughes writes about is his description
of the myth of "America as the Chosen Nation." This was
a story that flowed out of the experiences of the first Pilgrim
settlers in Massachusetts. Their endeavors seemed to them to be
much like those of the Jewish people in ancient times who escaped
their oppressor, Pharaoh, miraculously crossed a sea and then established
a new nation in the land of Canaan. The Pilgrims, too, had escaped
an oppressor (the Church of England), had crossed not a sea but
a vast ocean and found their own Promised Land in America.

Hughes describes wonderfully how the myth of America as the Chosen
Nation became central to the story Americans tell themselves about
their country's founding, meaning and purpose. The fundamental reason
this story has won such wide acceptance over so many decades is
that "the Puritans told a focused, compelling and convincing
story that no other immigrant group could match. Yet, it was a story
with which many immigrant groups could identify. In numerous books,
treatises, and sermons, the Puritans told how God led them from
oppression into a promised land. Immigrants from all over Europe – and
from many other parts of the world – found this story immensely compelling
and adopted it as if were their very own." They did so, in
no small part, because the story was their own whether they were
landless Northern Europeans, the starving Irish, persecuted Jews
or whomever.

And – up to this point, at least – Hughes has no problem with the story
of America as a seemingly Chosen Nation. It is when versions of
this myth become absolutized that the author begins to point to
the dangers of taking the story too literally.

For example, at the end of the nineteenth century, politicians appealed
to the myth of the Chosen Nation to justify American invasions of
Cuba and the Philippines. Senator Orville Platt of Connecticut summarized
his beliefs by saying that, "the same force was behind our
army at Santiago and our ships in Manila Bay that was behind the
landing of the Pilgrims on Plymouth Rock…we have been chosen to
carry on and to carry forward this great work of uplifting humanity
on earth." Over one hundred years later Madeline Albright would
talk about the need for the world's "one indispensable nation"
to intervene in the former Yugoslavia and George W. Bush would describe
his invasion of Iraq as the penultimate example of the "forward
force of freedom" that only America can bring to the world.

Hughes goes on to discuss four other national stories that Americans
tell themselves: the myths of Nature's Nation, Christian Nation,
Millennial Nation and Innocent Nation. Most of these stories have
potential for good by complementing and sustaining the promise of
America as promulgated in our Declaration of Independence, "that
all men are created equal, that they are endowed by their Creator
with certain unalienable rights, that among these are life, liberty
and pursuit of happiness." But if these stories are absolutized
in the manner described above regarding the myth of Chosen Nation,
trouble is sure to follow.

The myth of Nature's Nation says that the success of American democracy
and capitalism are the "natural" outcomes of the way the
world was originally created. Absolutizing this story, however,
has too often caused Americans to disdain (or even declare war on)
those who have instituted political economies of types different
than our own.

If Christianity is righteous and America is a Christian Nation,
the United States is by definition a righteous nation. Thus, the
myth of Christian Nation becomes a fairy tale that says whatever
behavior our country engages in on this planet, it must be behaving
righteously because America is the seat of righteousness in the
world.

The belief that the United States could help usher in an age of
freedom that would eventually bless all the people of the world
has been held by Americans since the first successes of the early
national period that began with the adoption of the U.S. Constitution.
This belief is at the foundation of the myth of Millennial Nation.
But this myth has always led to misery when America has tried to
coerce by force of arms others to be "free."

The United States as the Innocent Nation is the fifth and most useless
of the myths we use to tell the story of America to ourselves. Hughes
summarizes the situation nicely when he says that this is the only
myth that offers no redeeming qualities whatsoever "since it
is so completely grounded in self-delusion."

One of the author's purposes in writing this important book is to
"further the understanding of the power of religion in American
life." He goes on to note that every one of the myths "reflect
a powerful religious vision" as evidenced by the fact that
they are all tied in one way, shape or form to the experiences of
the Pilgrims in America, the First Great Awakening and the Second
Great Awakening. But you will have to read Hughes' book for yourself
(which is highly recommended) to get that part of this history.

The 2004 presidential election demonstrated once and for all that
these myths still have religious power in America. George W. Bush
is the perfect person – at least in the eyes of fifty-one percent
of Americans that voted in that election – to serve as America's
latest storyteller. This fact makes others of us long for him to
return to listening to grade school children read My Pet Goat.
It is an activity he is much better equipped to handle and so very,
very much less harmful to the rest of us.

Patriotism is love of one's country. Nationalism is a corruption
of this natural affection and replaces it with the worship of the
nation-state as a civil religion. As such, nationalism is a false
faith that represents the chasing after idols. But as the Chinese
say, "a journey of a thousand miles begins with one step."
Let our initial steps be to understand the "first causes"
of our civil religion and – should we choose to worship at its altar
in any way – to engage in its practices in the most humble manner
possible.

January
18, 2005

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

My understanding of what Lew was trying to say with his piece is
that liberty in America today is equally or even more threatened
by Big Government Conservatism than it is by Big Government Liberalism.
One of the main reasons why this is true is that the former is much
more nationalistic and militaristic than the latter. This is important
because nationalism is often used to mask militarism, although the
reverse has not and cannot ever be the case.

To a very large extent, nationalism is a corruption of patriotism.
It substitutes love of country with the worship of the nation-state
as a civil religion.

Last year William Inboden published an important article, "One
Cheer for Civil Religion?" in Modern Reformation Magazine.
He pointed out in this piece that civil religion is as old as both
the church and the state themselves. Inboden quotes the eighteen-century
historian, Edward Gibbon, regarding his thoughts on civil religion
in ancient Rome: "The various modes of worship which prevailed
in the Roman world were all considered by the people as equally
true; by the philosopher as equally false; and by the magistrate
as equally useful." If we substitute the word "politician"
for the word "magistrate" Gibbon's observations become
equally true in America today.

How religious – or irreligious – were America's founders?
Inboden sketches a history that runs from the Pilgrims, to the Civil
War, through the Cold War and into the present age. The "city
upon the hill" that John Winthrop saw the Pilgrims creating
in America was not a Christian nation-state, or even a nation-state
at all. The Pilgrims sought to form a new Christian community that
would be a beacon upon which the eyes of the English Church would
be transfixed. Winthrop and the Pilgrims retained and were proud
of their English citizenship for all the time their community existed
in America.

Unfortunately, the Pilgrim's original mission to form a distinctive
new religious community in America failed miserably. It was their
descendents that decided to make America a new nation. In Inboden's
words, "rather than being founded as a distinctively Christian
nation-state, the birth of the United States came as almost an accidental
by-product of a failed Christian community."

This did not keep our founding fathers (or should we say, "founding
magistrates") from giving birth to American civil religion
at the same time that they gave us the Declaration of Independence.
When the first Congress solicited ideas for a national seal, both
Thomas Jefferson and Benjamin Franklin suggested a depiction of
God drowning Pharaoh's army in the Red Sea to convey the theme of
God granting liberty to his chosen people – in this case, Americans
rather than the Old Testament Israelites.

But even Jefferson and Franklin cannot blur the distinction between
American civil religion and biblical Judeo-Christianity. The latter
acknowledges God's revelation as its true authority and pledges
its ultimate loyalty to God's name. Nor should any of the national
flags placed in sanctuaries found throughout America confuse these
priorities and loyalties.

In the modern era, the Cold War did much to restore the notion that
Americans were a people chosen by God to lead the fight against
Godless communism. The presidency of Dwight D. Eisenhower is instructive
in this light. Over the eight years of his administration, Eisenhower
did the following:

1. Just after
   having been inaugurated as president, Eisenhower was baptized
   for the first time in a public ceremony at the National Presbyterian
   Church in Washington, D.C.
2. Before
   one of his inaugurations, Eisenhower made an unprecedented offering
   of his own prayer at this ceremony.
3. He had
   his cabinet meetings open with prayer and instituted the National
   Prayer Breakfast.
4. It was
   during the Eisenhower administration that "In God We Trust"
   was adopted as the United States' motto and began to be printed
   on the nation's currency.
5. It was
   also during this time that the words "one nation under God"
   were added to America's pledge of allegiance.

The American experiment with limited government was and is unique
in the world's history. But the bible unequivocally places God in
authority over all nations and governments. More importantly, it
is by virtue of a person's allegiance to this God rather than the
country that he or she resides in that makes all the difference
in a truly religious sense.

Considering how civil religion in America grew during the Civil
War, it is ironic that Abraham Lincoln got this last point right
when he said that "Americans are an almost chosen people."
But the word "almost" makes all the difference in the
world.

Nationalism as the worship of a nation-state as a civil religion
is a false faith. It represents chasing after idols. When nationalism
is used to mask militarism and imperialism it is worse than a false
faith. It is the gravest of sins that can only be forgiven by a
truly loving God.

I wish everyone a Happy Lew Year and Godspeed in your efforts on
behalf of truth, justice and peace. In 2005.

January
3, 2005

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

In 1000 Years for Revenge Lance demonstrated that culpability
for what happened on 9-11 ran through the three presidential administrations
of Bush I, Clinton and Bush II. The FBI infiltrated a terrorist
cell operating within a Brooklyn mosque in 1991 but then drove off
their "mole" prior to Ramzi Yousef joining the cell in
1992. Yousef went on to mastermind the plot and build the explosive
device used in the first World Trade Center bombing in 1993.

Yousef escaped New York after the bombing and set up another terrorist
cell in the Philippines with his uncle, Khalid Shaikh Mohammed (KSM).
In the early 1990's Yousef and KSM planned three terrorist plots
together: the assassination of the Pope, the simultaneous bombing
of eleven commercial airliners and the "crashing of airplanes
into buildings" tactic used on 9-11.

All three of these plots were uncovered in 1994 when a man associated
with Yousef and KSM was captured and successfully interrogated by
Philippine authorities. Their findings were forwarded on to the
U.S. embassy in Manila which passed them on to the FBI in 1995.

Around this time Yousef was captured in an Osama bin Laden–sponsored
boarding house in Pakistan and handed over to FBI officials in that
country. Incredibly, KSM was staying in the same compound but went
undiscovered by the FBI. A TIME magazine reporter, however,
found KSM while the FBI was taking over the arrest of Yousef and
interviewed him (using KSM's real name) for an article about how
Yousef was captured.

Yousef went on to plan and communicate the plot that ultimately
led to the bombing of TWA Flight 800 in 1996 from his jail cell.
The FBI was made aware of this plot through an informant that they
had working as an asset for them in the same jail.

The work to cover up these unpleasant facts was begun by the 9-11
Commission coincident with its formation. As one commissioner, Jamie
Gorelick, admitted in April of 2004, the "vast preponderance
of our work, including with regard to the Department of Justice,
focuses on the period of 1998 forward."

How convenient and how telling! What's the point of looking into
the FBI's infiltration of the Brooklyn terrorist cell during the
administration of George H. W. Bush? Why bother noting the ties
established in 1992 between this cell and Ramzi Yousef, the mastermind
behind the World Trade Center bombing that took place just after
the first Bush administration transferred power to the Clinton administration
in February of 2003?

What about the information obtained by Philippine authorities regarding
the Manila terrorist cell established by Yousef and KSM in the early
1990s? How about the information regarding the three terrorist plots
uncovered in the Philippines and turned over to the FBI in 1995?

What about the failure of Clinton's FBI to capture KSM at the same
time as Pakistani officials handed Yousef over to them in 1995?
Why did the FBI under both Clinton and George W. Bush keep the hunt
for KSM such a secret until after 9-11? Why was the 1996 federal
indictment against KSM kept sealed until 1998?

Doesn't the FBI ultimately answer to the Attorney General at the
Department of Justice? Wasn't Commissioner Gorelick a high ranking
Justice Department official during the Clinton years? And with such
an obvious conflict, why was Gorelick named to the 9-11 Commission
in the first place?

This last question is a relatively easy one to answer. Gorelick
was probably put on the 9-11 Commission to counterbalance the appointment
of Phillip Zelikow to be the commission's staff director. Beginning
in October of 2001, Zelikow had been appointed to President Bush's
Intelligence Advisory Board. This meant that if he reviewed the
work of the NSC on behalf of the 9-11 Commission, he would effectively
be investigating himself.

Zelikow had also previously co-authored a book with NSC Director
Condi Rice. Mindy Kleinberg (one of the "Jersey Girls")
summarized the situation in this way, "What an incredible conflict!
The evidence was pointing to a series of key memos issued in the
summer of 2001 and included the August 6th Presidential
Daily Briefing. Condi Rice was at the heart of all of that. How
could we expect Zelikow to fairly investigate his own friend and
colleague?"

The role of the Zelikow-Gorelick axis became more prominent as the
9-11 Commission pursued its work. The only commissioners ever allowed
by the White House to personally review classified NSC documents
were Zelikow and Gorelick. As Patty Casazza (another of the "Jersey
Girls") summarized things, "We called it the two-to-four-to-ten
deal."

Casazza went on to explain that, "instead of allowing all ten
Commissioners to go in and examine key documents like the President
Daily Briefing of August 6th, they set up this system
in which Zelikow and Gorelick would go in and then Kean and Hamilton
would review their report, which could be edited by the White House.
Then this final version would get seen by everybody."

But what if the 9-11 Commission had been made aware of Peter Lance's
investigative work that was completed in 2003? Well, they were made
aware of it and largely ignored Lance's findings.

In late 2003 a copy of Lance's 1000 Years For Revenge was
made available to the Chairman of the 9-11 Commission, Thomas Kean.
In January of 2004, Kean wrote a letter to Lance indicating that
Kean had read the book and was forwarding Lance's findings to Phillip
Zelikow.

Zelikow also wrote Lance a letter that same month indicating that
Zelikow wanted Lance to be interviewed by a 9-11 Commission staff
member, Dietrich Snell. This former Assistant U.S. Attorney had
successfully prosecuted Yousef in the case that involved the plot
to simultaneously bomb eleven commercial airlines flying from Asia
to the United States. KSM was a key co-conspirator in this plot
but was never mentioned by the prosecution in the case. Snell would
have made an excellent witness for the 9-11 Commission to question
about Yousef and KSM. He was, instead, one of the investigators.
Peter Lance's findings were mentioned once in a footnote to the
9-11 Commission's report.

After the Watergate scandals resulted in the resignation of President
Richard M. Nixon, the saying "it's not the crime that gets
you, it's the cover up" became popular. Because of Peter Lance's
new book, Cover Up, regarding the terrorist attacks of September
11, 2001 and the work of the 9-11 Commission, it will (hopefully)
be both that ultimately leads to the punishment of all parties involved
in the crime and the cover up.

September
14, 2004

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

Lance unveils shattering new evidence regarding Ramzi Yousef, the
terror mastermind behind the first World Trade Center bombing. After
his capture and trial, Yousef planned and communicated – from his
prison cell – the July 17, 1996 bombing of TWA Flight 800 that killed
230 people. He also helped create the plot that ultimately led to
the 9-11 terrorist attacks.

Why are Lance's findings so important? Because the recently published
report of the 9-11 Commission states that it was Yousef's uncle,
Khaled Shaik Mohammad (who will be referred to from this point on
as KSM), who was solely responsible for originating the plot that
led to the events of 9-11.

Peter Lance chronicles blunder upon blunder made by U.S. government
agencies – but principally the FBI – for twelve years starting in 1989.
Culpability runs through the administrations of George H.W. Bush,
Bill Clinton and George W. Bush.

On four successive weekends in July of 1989 the FBI followed a group
of Middle Eastern men from an Islamic mosque in Brooklyn to a shooting
range in Calverton, Long Island. One of these men would later be
convicted of murdering a rabbi in New York City, one became the
trainer of Osama bin Laden's bodyguard in Afghanistan and three
of the other men that were followed to Calverton would be convicted
of plotting the first World Trade Center bombing in 1993. In other
words, these men were participants in the "mother of all terrorist
cells" twelve years prior to September 11, 2001.

On November 5, 1990 Rabbi Meier Kahane was killed by one of the
Calverton shooters, El Sayyid Nosair. In searching the murderer's
home the FBI found 47 boxes of evidence suggesting a broad international
conspiracy. Two other Calverton shooters, Mahmud Abouhalima and
Mohammed Salameh, who were questioned at the time and then released,
were later convicted in the first World Trade Center bombing trial.

In July of 1990 a close associate of Osama bin Laden's, Sheikh Omar
Abdel Raham, entered the United States despite being on a "watch
list." He began a campaign to unseat the head of the Brooklyn
mosque where the Calverton shooters congregated and succeeded this
former leader when that person was murdered on February 26, 1991.
The mosque then became a "bricks and mortar" outpost for
Osama bin Laden in the heart of New York City.

In 1991 FBI Special Agent Nancy Floyd recruited an Egyptian U.S.
naturalized citizen, Emad Salem, to work as an FBI asset within
the Brooklyn mosque. Salem subsequently discovered a plot to bomb
twelve locations in and around New York City. But in 1992 Nancy
Floyd's new boss, Carson Dunbar, effectively drove Salem to cease
his activities as a mole, thus depriving the FBI of its chief asset
in the Brooklyn mosque.

On September 1, 1992 Ramzi Yousef arrived in New York City. During
the fall of 1992 Yousef built the 1,500-pound bombing device that
eventually killed six people and wounded one thousand more on 2/26/93
at the World Trade Center.

Within hours of this bombing a U.S. attorney, Mary Jo White, ordered
the FBI to bring Emad Salem back into the fold. His work later led
to the prevention of the terrorist plot to blow up New York City
landmarks such as the Lincoln Tunnel and the George Washington Bridge.
Had he not been driven away from his work by the FBI earlier, Salem
might very well have led the government directly to Ramzi Yousef
and his bomb factory prior to the first World Trade Center bombing.

As things turned out, Yousef left New York City on the night of
2/26/93 and eventually established a new terrorist cell with his
uncle, KSM, in the Philippines. By November of 1994 they had set
up a bomb factory and had incubated three separate terrorist plots.
The first called for the murder of Pope John Paul II. The second
plot was to plant bombs on eleven commercial airline flights from
Asia to the United States. The third plot was the hijack-airliners-fly-them-into-buildings
scenario that led to the events of 9-11.

All three of these plots were uncovered when an accidental fire
took place at Yousef's headquarters. Although Yousef and KSM escaped
the country after the fire, their associate (Abdul Hakim Murad)
was captured and successfully interrogated by a Philippine Colonel,
Rodolfo Mendoza. He turned the details of all three plots over to
the U.S. embassy in Manila in 1995 and the documents were subsequently
turned over to the FBI later that year.

One month after the capture of Murad, Yousef was arrested in Islamabad,
Pakistan at a boarding house controlled by Osama bin Laden. Although
the FBI falsely took credit for his capture, their agents did fail
to search the rest of the 20-room guesthouse where KSM was not only
staying in a room on the ground floor, but actually gave an interview
to TIME magazine using his own name.

Yousef was returned to the United States and convicted for his roles
in both the World Trade Center bombing and the plot to blow up the
eleven commercial airliners. In neither trial was any mention made
of the plot to crash airliners into buildings such as was done on
9-11.

Although KSM was also indicted for his role in planning the plot
to blow up the eleven commercial airliners, his indictment was sealed
and not made public until 1998. As a fugitive, KSM was never treated
by the United States in the same way as his nephew, Yousef, was
until after 9-11.

While Yousef was in his jail cell awaiting trial in New York, he
ordered the bombing of TWA Flight 800 that took place on 7/17/96.
This bombing was executed in exactly the way Yousef and KSM had
planned to bomb the eleven commercial airliners flying from Asia
to the United States. Yousef's motivation for the bombing was to
effect a mistrial in his own terror-bombing case.

The FBI was alerted to Yousef's plans to bomb a flight such as TWA
800 well in advance of its occurrence. Yousef confided the information
to a prison informant – Greg Scarpa, Jr. – who even passed
along a detailed sketch of the bomb-trigger device designed by Yousef.
A picture of this document is included in the appendix to 1000
Years for Revenge.

Peter Lance connects all of the dots between what the U.S. government
has known from 1989 on about the Calverton shooters, Osama bin Laden's
"bricks and mortar" outpost in Brooklyn, Ramzi Yousef,
the first World Trade Center bombing, Khaled Shaik Mohammad, the
three terrorists plots hatched in Manila, KSM's "escape,"
and the bombing of TWA Flight 800. In order to do so he conducted
dozens of first person, taped interviews with individuals such as
the Philippine interrogator, Colonel Mendoza, who first uncovered
all three of the Yousef-KSM plots.

Lance has also reviewed hundreds of declassified documents and read
over 40,000 pages of court records for the first World Trade Center
bombing trial and other cases. Peter Lance is also a five-time,
Emmy-winning investigative reporter. Calling Oliver Stone! Calling
Oliver Stone! Oliver Stone, can you hear us?

September
11, 2004

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

For example, Buchanan rightly criticizes the expansion of America's
military bases into Saudi Arabia (under George H. W. Bush) Eastern
Europe (by Bill Clinton) and Central Asia as well as Iraq (under
George W. Bush). He also correctly notes that these new installations
mean that the United States now has troops based in over 100 of
the world's 160 countries.

But Buchanan fails to discuss why the vast majority of these bases
were established in the first place. Ostensibly, they were built
to help fight the Cold War. Yet long after the fall of the Soviet
Union, virtually none of the installations have been closed. Why?
Buchanan can not bring himself to admit that these bases have always
had more to do with projecting an American Empire than just defeating
the "Red Menace."

Buchanan's introduction as well as chapters one, two and ten really
hammer home the most powerful themes of his book. But sandwiched
in between are chapters that deal with everything from the political
background of Islam, the history of terrorism, China as an emerging
power on the world stage, American economic malaise, Congress' abdication
of its Constitutional roles and judicial activism in America.

Most of these chapters are both interesting and informative. But
they become distractions as the reader tries to follow the powerful
case against our country's misnamed and hopelessly misguided "War
on Terrorism" that Buchanan makes in his book.

Before America can defeat the enemy that brought down the World
Trade Center, it must be able to correctly identify it. And that
enemy cannot be "terrorism" since it is merely a tactic,
a technique and a weapon. In this regard, Buchanan notes what Zbigniew
Brzezenski said after September 11, 2001: "Declaring a war
on terror after 9-11 made about as much sense as it would have for
Britain and France, after Hitler's lightening invasion of Poland,
to declare war on blitzkrieg."

Nor is the enemy radical Islam, per se. On this point, Buchanan
quotes Michael Vlahos: "This terrorist network is a ring of
military subcultures that represents a much larger political movement
within Islam, one that is nothing less than a civilization-wide
insurgency against the established regimes of Sunni Islam."
This is a battle within Islamic nations that the United States should
avoid involving itself with at any cost.

Yet for decades our country has supported the very autocracies against
which this growing political movement within Islam rages. And as
far as the insurgents inside this movement are concerned, America
really crossed the line when it established military bases in Saudi
Arabia and continued to maintain its presence there long after the
Persian Gulf War had ended.

Ironically, the United States has recently acceded to the demand
that it remove its military bases from Saudi Arabia. Unfortunately,
America is replacing these installations with new ones within another
country of significant religious importance to Islamic peoples – Iraq.

It is exactly at this juncture that Buchanan indicts neoconservatives
and "big government Conservatives" along with their lackey,
George W. Bush. "Interventionism," Buchanan writes, "is
not the solution to America's problems in the Middle East. Interventionism
is the problem. America's huge footprint in Saudi Arabia led straight
to 9-11. The terrorists were over here because we were over there.
Terrorism is the price of empire. If you do not wish to pay the
price, you must give up the empire."

This is the proper context within which the "War on Terrorism"
must be viewed. And Buchanan tells us that history gives us very
little hope that we can win such a war when it is being fought under
false assumptions and pretenses, "the one endeavor at which
Islamic peoples excel is expelling imperial powers by terror and
guerrilla war. They drove the Brits out of Palestine and Arden,
the French out of Algeria, the Russians out of Afghanistan, the
Americans out of Beirut and Somalia, the Israelis out of Lebanon…We
have started up the road to empire and over the next hill we shall
meet those who went before. The only lesson we learn from history
is that we do not learn from history."

Unfortunately, the United States did not "start up the road
to Empire" with its invasion of Iraq. But if this monumental
blunder causes America to begin to finally turn off this road, it
will truly be a case of "better late than never."

September
3, 2004

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.

This is the role that Thomas J. DiLorenzo (a professor of economics)
assumes as a lay historian in his new book, How
Capitalism Saved America. This "untold history of our
country, from the Pilgrims to the present" is a first rate
rendition in every way of how America became a wealthy nation because
of its adoption of a free enterprise system.

It is probably unfair to refer to DiLorenzo as a "lay historian."
He is the author of a revealing history, The
Real Lincoln, about our nation's sixteenth president. But
students of American history are increasingly beginning to see that
most historical accounts of the United States that they have read
contain little information (and quite a bit of misinformation) about
the role our economic system has played in making America a great
nation. Who better than an economics professor like DiLorenzo to
tell this story?

The author uses his book to argue convincingly that our nation's
wealth has come from one source and one source alone – its
adherence to the principles of the free enterprise system. But DiLorenzo's
work is not a boring polemic about economic theory. Because he uses
the history of the United States to make his points, his illustrative
stories are always interesting and often very entertaining.

The first use of this narrative technique by DiLorenzo may also
be the best example of its effectiveness. It comes in the third
chapter, How Capitalism Saved the Pilgrims. The party first
charged with the settling of America by England, the Virginia Company,
sent a total of 604 settlers to the Tidewater region around Jamestown
over a two-year period beginning in 1607. These pioneers found a
moderate climate, rich soil, plentiful game and an abundance of
seafood. Yet within a few months of their arrivals in the New World,
526 of the original 644 settlers were dead due to starvation or
disease. Why?

The Virginia Company had made an investment in these settlers by
giving them free passage to America. They, in turn, were to compensate
the Virginia Company for seven years through their labor as indentured
servants. But since it would take seven years before their labor
would benefit them directly, the group became indolent to the point
of risking their own lives by not performing the agricultural tasks
required of them.

In other words, the imposition of an essentially communal ownership
of land and property for seven years by the Virginia Company caused
their settlement efforts to fail miserably. In 1611 the British
government amended the system to allow each man to own three acres
of his own land and work for no more than one month a year to make
his contribution to the colony. It was from this point onward that
America began to grow mightily.

In chapter after chapter DiLorenzo relates stories of how the American
people used capitalism, laissez-faire economics and the free enterprise
system to overcome most of the obstacles they faced throughout their
history. The author points out, for example, that the American Revolution
was primarily a revolt against the British economic system, mercantilism,
which was limiting the freedom of the colonists to benefit from
the free enterprise system that had taken root in America.

During the constitutional period there was an internal political
struggle within the country between those who favored an "American
mercantilism" (Federalists such as Alexander Hamilton and John
Adams) and those who fought against government interference in the
economy (Republicans like Thomas Jefferson and James Madison). Fortunately
for the history of our country, the Republicans emerged victorious
in the struggle and dominated the federal government for almost
fifty years after the election of 1800.

America's economic freedom, however, has been steadily eroded by
government intervention since the first half of the nineteenth century.
DiLorenzo says it this way, "any discussion of economic freedom
must consider degrees of freedom, for neither the United
States nor any other nation has ever had an economy that was generally
free from government interference – that is, free of taxes and regulations."

In Chapter Seven of his book, The Truth About "Robber Barons,"
DiLorenzo makes an important and very useful distinction. He contrasts
u2018market entrepreneurs' with u2018political entrepreneurs.' The former
succeeds by always striving to please his customers who can hire
or fire him at a moment's notice. The latter "succeeds primarily
by influencing government to subsidize his business or industry,
or to enact legislation that harms his competitors."

It is in this sense alone that the United States has a "mixed
economy" today. Our wealth has primarily been created by market
entrepreneurs such as James J. Hill, John Rockefeller, Bill Gates
and most small business owners. It is diminished currently by political
entrepreneurs such as subsidized farmers and defense contractors.
Finally, a good portion of our wealth has been to a great extent
squandered by government run enterprises.

How
Capitalism Saved America is a seminal work about economics and
the history of the United States of America. Thomas J. DiLorenzo
has made a great contribution to our nation by writing it. And he
has performed a major service to the book's future purchasers (of
which there will be a great many) by making it so easy and fun to
read.

August
20, 2004

Kirk
W. Tofte [send him mail] is
the manager of the BWIA Private Investment Fund and the author of
Be
Principled and Grow Rich: Your Guide to Investing Successfully in
Both Bull and Bear Markets. He lives in Des Moines, Iowa.