Whooping Cough Makes a Comeback
September 28, 2010
The Washington Post
By: Arthur Allen
For most parents with young children today, whooping cough is a disease that exists in vintage movies or the Burl Ives song where it causes a chicken to “sneeze his head and tail right off.”
But whooping cough is far from a whimsical memory. It is staging a comeback in California, in what public health officials worry could be a harbinger of a national trend.
Nine infants have died of the disease in California this year, and more than 600 other babies have become desperately ill. To keep them alive, doctors have sometimes resorted to blood transfusions, hooking the babies up to devices resembling heart bypass machines. More than 4,100 cases have been reported so far, creating what officials call the worst pertussis epidemic in the state since 1955.
The resurgence of the highly contagious disease is particularly alarming because most children in California, as in the rest of the country, have received six doses of vaccine by age 12.
A combination of factors may be to blame.
In California it is legal and quite easy to refuse vaccination, and the discredited theory that vaccines cause autism has created clusters of unvaccinated children. In affluent Marin County north of San Francisco, for example, about 13 percent of parents refused vaccination for their kindergartners in 2009, according to the state’s Department of Public Health. Marin has one of the highest rates of infection this year.
Pertussis is more infectious than smallpox, polio or influenza, and it spreads quickly through the unprotected. It often escalates from what seems to be a regular cold into a severe respiratory infection that causes some patients to gasp for air with a distinctive high-pitched whooping sound.
But while shunning vaccine is probably playing a role in the epidemic, particularly in some areas of the state, it isn’t the only cause, according to Kathleen Harriman, California’s chief epidemiologist for vaccine-preventable diseases. Better detection explains some of the increased reports of pertussis. But Harriman and other experts worry that the epidemic could also point to serious problems with the current vaccines.
In the view of some pertussis experts, the vaccines in use since the mid-1990s aren’t as effective as some of the vaccines they replaced.
“The acellular vaccines simply aren’t as good as the good whole-cell vaccines,” says James Cherry of UCLA, who has studied whooping cough for the past 30 years.
Those whole-cell vaccines, developed in the 1940s, were made by deactivating whole pertussis bacteria. While they were effective against whooping cough, they caused seizures and high fevers in some children and were blamed for rare cases of brain damage. The controversy over the whole-cell vaccines began in the late 1970s and never really ended, but they were replaced in the United States by vaccines that instead contained varying amounts and types of purified pertussis proteins.
These acellular vaccines were safer and are said by the Centers for Disease Control and Prevention to be 80 to 90 percent effective. But Cherry believes that the trials that established this figure – most of those studies were done in Europe – overestimated the degree of protection. Sometimes the vaccines prevented classic whooping cough, but the patients got lighter versions of the disease and were still contagious, said Cherry, who was involved in the trials.
Frits Mooi of the Dutch National Institute of Public Health and the Environment, holds another disturbing view. His research shows that pertussis bacteria have evolved mechanisms to evade vaccine-produced immunity.
While he emphasized, in an e-mail exchange, that increased vaccination is still the best way to lower the pertussis rates at present, in the long run public health officials can’t avoid facing the evidence of bacterial mutation and “should strive for pertussis vaccines that protect longer.”
Although Cherry and other experts are skeptical about whether the pertussis evolution found by Mooi has diminished vaccine effectiveness, they agree with him on one unpleasant fact: Unlike with many other diseases against which we immunize, such as measles, vaccination doesn’t always prevent you from getting whooping cough. Neither, in fact, does natural infection.
“My one-line explanation is, ‘There’s no such thing as being fully vaccinated against pertussis,’ ” said Thomas Clark, a leading pertussis tracker at the Centers for Disease Control and Prevention in Atlanta. “Your immunity is always waning over time.”
Decline, then revival
Despite current concerns, there is no question that vaccines have done a good job at suppressing a disease that used to be a scourge. Before the introduction of whole-cell vaccines, whooping cough was at best an unpleasant passage of childhood, at worst a deadly tragedy. It claimed up to 10,000 lives each year in the United States.
As vaccination became widespread, the number of U.S. cases declined by more than 99 percent. But after bottoming out in 1976, the numbers began to creep up, especially in the past decade. In 2009, according to the CDC, there were nearly 17,000 reported cases, including 14 deaths nationally.
The acellular vaccines prevent disease in many people, and when disease occurs it is less serious in the vaccinated. Of the nine fatalities in California, eight were children too young to be vaccinated. The ninth child was 2 months old, had been born very premature and had received one shot.
Whooping cough is a cyclical disease. The last nationwide peak year was 2005, when more than 25,000 cases were reported and 39 people died.
There’s no sign of a major outbreak this year in this region, with only 89 cases reported so far in Maryland and about 150 in Virginia. In both states and the District, it is much more difficult than it is in California for parents to exempt their children from vaccination.
But CDC officials say the California epidemic could herald a wider spread and are recommending that parents make sure their kids are vaccinated. Last week, officials in Indiana and South Carolina said they were seeing an upsurge of the disease.
Before 2005, there was no persussis-containing vaccine for anyone older than 6. Since then, booster vaccines have been licensed, and most jurisdictions, including Maryland, Virginia and the District, require adolescents to get a booster by age 12.
Public health authorities are urging adults to get boosters, too, especially hospital employees, new mothers and others in contact with vulnerable infants.
Click here to read the full report from The Washington Post
Ben & Jerry’s to Finally Remove ‘All Natural’ From Labels
September 27, 2010
Yahoo! News
Ice cream maker Ben & Jerry’s is dropping the phrase “all natural” from all labels after a request from a health advocacy group.
The Center for Science in the Public Interest and the company confirmed the move Monday.
The CSPI told the company last month it should not use “all natural” if products contain alkalized cocoa, corn syrup, hydrogenated oil or other ingredients that are not natural.
Ben & Jerry’s, a unit of consumer products giant Unilever, says it’s not changing any recipes. It’s just removing the label from all products.
The Food & Drug Administration has no formal definition for “natural.” But it won’t object to term as long as products do not contain added color, artificial flavors or synthetic substances.
Click here for the full report from Yahoo! News
Middle-Aged Suicides on The Rise
September 27, 2010
Reuters
By: Maggie Fox
Suicide rates for middle-aged people are edging up — particularly for white men without college degrees — and a combination of poor health and a poor economy may be driving it, U.S. researchers said on Monday.
Middle-aged people usually have a relatively low risk for suicide as they seek to support their families, but baby boomers are bucking this trend, sociologists Julie Phillips of Rutgers University in New Jersey and Ellen Idler of Emory University in Atlanta found.
“If these trends continue, they are cause for concern,” Phillips and Idler wrote in the journal Public Health Reports.
“Male baby boomers have yet to reach old age, the period of the male life course at highest risk for suicide; if they continue to set historically high suicide rates as they did in adolescence and now in middle age, their rates in old age could be very high indeed.”
The researchers used suicide data from the National Center for Health Statistics and analyzed it by age group, marital status, education and other factors. The period they studied preceded the most recent economic crisis.
“Following a period of stability or decline, suicide rates have climbed since 1988 for males aged 40-49 years, and since 1999 for females aged 40-59 years and males aged 50-59 years,” they wrote.
In 1979 the suicide rate for men aged 40 to 49 was 21.8 per 100,000. It rose to as high as 24 per 100,000 in 1996 and to 25 by 2005. For men 50 to 59 it was 23.9 in 1979, fell to 20.4 per 100,000 in 1999 and rose again to nearly 23.8 in 2005.
For women it was much lower — 9.9 in 1979 for women aged 40 to 49, rising and falling during the years in between and ending at 7.8 per 100,000 in 2005.
“One question we asked was does this have something to do with the people?” Phillips said in a telephone interview. “Baby boomers have been a group noted for high rates of suicide in the past. It makes me wonder if there is something about baby boomers that may contribute to this pattern.”
To figure out what might be causing the changes, Idler and Phillips looked at potential outside factors — although they note that just because two things happen at the same time, it does not prove cause and effect.
“Unemployment rates in the U.S. rose between 2000 and 2003 at the same time that middle-aged suicide rates increased rapidly,” they wrote.
“In addition, rates of bankruptcy increased between 1991 and 2007, in part because of changes in the law, but with personal financial consequences nevertheless.”
And baby boomers are the least healthy middle-aged generation, with large rates of obesity and the diseases that result, such as diabetes and heart disease.
“The percentage of those aged 45 to 64 years with multiple chronic diseases increased from 13 percent in 1996 to 22 percent in 2005, with a concomitant rise in out-of-pocket spending for health-care services,” Phillips and Idler wrote.
“The burden of disease falls disproportionately on those who are less educated, the group also least likely to have adequate employer-based health insurance.”
As other studies have shown, the risk of suicide was substantially larger for unmarried than for married people, with unmarried middle-aged men 3.5 times as likely to commit suicide as married middle-aged men.
Click here for the full report from Reuters
New Bank Charges To Hit Accounts Soon
September 28, 2010
CNN Money
Blake Ellis
NEW YORK — Bank fees: They’re like a game of Whac-a-Mole. The minute one set is banned, a whole new set pops up.
In August, the Card Act banned a variety of fees — including certain overdraft and excessive late charges. But one month later, banks are increasing existing fees and finding creative new ways to charge customers more for credit cards, so-called “free” checking accounts and banking services.
Already this year cash-advance fees and balance transfer fees have risen to 4%, up from 3% in July last year, according to a study conducted by the Pew Health Group’s Safe Credit Cards Project.
“It’s like you’ve got a sinking boat, where you plug one hole and another one springs up,” said Curtis Arnold, founder of CreditRatings.com. “You can shut down one egregious fee, but that doesn’t mean other fees aren’t just going to start popping up elsewhere.”
Here’s a bank-by-bank look of what to expect.
Bank of America: Just last week, Bank of America said it plans to raise minimum balance requirements over the next 12 months and charge a monthly account fee for customers who can’t maintain those balances.
“We currently estimate over time through these and other items we are working on that we will have the ability to offset a substantial majority of the revenue from the various regulatory changes,” Bank of America (BAC, Fortune 500) CEO Brian Moynihan said in a presentation to investors last week.
Customers enrolled in the lender’s new eBanking checking account will be charged $8.95 per month if they opt to receive paper statements and visit tellers instead of banking online. Since the launch of eBanking in August, nearly half of all new checking accounts fall into this category.
Earlier this year, annual fees ranging from $29 to $99 were applied to a variety of Bank of America credit card accounts.
Wells Fargo: Remember how Wells Fargo (WFC, Fortune 500) fought a pitched battle with Citigroup for the right to merge with Wachovia? Well, Wachovia customers are now being fully integrated — including being charged Wells’ higher fees. Receive images of cancelled checks with your paper statement? $2. Use your savings as overdraft protection? $10 fee every time you make a transfer.
Previously, these fees already existed for Wells Fargo customers but were only applied to a very small number of Wachovia customers.
HSBC: HSBC (HBC) is charging a $19 annual fee for customers who open a line of credit beginning July 1 and an additional $10 every day they use the credit line as protection from overdrawing their checking account.
“This is not unusual in the industry and our competitors have been charging similar such fees for some time,” an HSBC spokesman said. “The change aligns us with our competitors.”
Other banks let customers link their savings and checking accounts as an alternative option for overdraft protection. But HSBC doesn’t, meaning customers will either pay a fee to open a line of credit (if they have good enough credit to qualify), pay a fee for overdrafting their account or get their card declined.
Citibank: Citi (C, Fortune 500) announced changes to its checking accounts this month and will now assess monthly maintenance fees of up to $30, depending on the checking account and whether the customers meet certain requirements — such as making a certain number of monthly transactions or carrying a specific minimum balance.
Monthly maintenance fees were previously as low as $3, depending on the account.
Earlier this year, Citi imposed a $60 annual fee that could be waived if customers spent about $2,400 a year. But the new regulations banning inactivity fees led the bank to eliminate the fee soon after it was introduced.
American Express: American Express (AXP, Fortune 500) has added $29 fees to more of its cards. As of July, the new fees affect customers with Delta, JetBlue, Hilton and Starwood cobranded cards who want to recoup reward points they forfeited for paying a bill late.
The point-forfeiture fee already existed on other cards, so the bank said it wanted to be “consistent and have it across cards.”
Not us!: JPMorgan Chase (JPM, Fortune 500) and Discover (DFS, Fortune 500) said they haven’t introduced any new checking account or credit card fees in the past year.
Because of how competitive the already cutthroat industry has become, banks have to be careful how far they go — or they risk losing desperately-needed customers.
“They have to be really careful about rolling anything new out in this environment,” said Peter Garucci, a spokesman for the American Banking Association. “They’ve always competed for the same number of wallets, but if the number of wallets is smaller because of the down economy and new rules, the competition is going to increase and the last thing they’re going to want to do is make their customers mad.”
Consumers should take advantage of this increased competition to negotiate fees with their banks.
“Fees especially are very much negotiable, so if you see something show up in your account that you don’t like, call and complain, and threaten to take your business elsewhere,” Arnold added. “Chances are if there’s a fee or interest rate you don’t like one place, you’ll find something better somewhere else.”
Click here to view the full report from CNN Money.
Are Organic Eggs Safer?
September 28, 2010
Mercola.com
Dr. Mercola
Federal officials have matched the Salmonella responsible for current egg recalls to bacteria found in barns and chicken feed at two major Iowa egg producing facilities.
This has relaunched the debate over whether eggs from smaller, organic farms are safer.
Organic farmers argue that the conditions under which large agribusiness raises and houses chickens create an environment where bacteria can spread more easily. The birds are often kept in cages that are stacked closely next to and on top of each other.
According to Live Science:
“‘The smaller the farm is, the lower the likeliness of Salmonella,’ said infectious disease specialist William Schaffner … ‘The general thinking is that larger chicken farms are much more difficult to keep clean, and this makes it easier to transmit Salmonella.’”
Click here to read the full article from Mercola.com.
Independent Thinkers May Be Considered Mentally Ill
September 28, 2010
The Sovereign Society
Mark Nestmann
Do you question authority? Fail to accept conventional wisdom? Lose your temper when you hear a politician make a promise that you know he or she can’t keep?
If so, you may be mentally ill, according to the most recent revision of the Diagnostic and Statistical Manual of Mental Disorders (DSM). In this revision, psychiatrists hope to add dozens of new mental disorders. Unfortunately, many of these so-called illnesses target people who merely think or behave differently from the majority population.
A case in point is “oppositional defiant disorder (ODD).” DSM defines ODD as “an ongoing pattern of disobedient, hostile and defiant behavior toward authority figures.” Symptoms include losing one’s temper, annoying people and being “touchy.” Other “disorders” include antisocial behavior, arrogance, cynicism and narcissism. Sounds like many of my readers!
While diagnosis of ODD “victims” focuses on children, there’s no reason why ODD can’t exist in adults. Indeed, ODD can evolve into “conduct disorder” (CD), which DSM defines as “wherein the rights of others or social norms are violated.”
Uh-oh. So violating “social norms” is now a mental illness as well.
Let’s connect the dots, shall we? There’s a long and sordid history of governments using psychiatry for political repression. In the Soviet Union, thousands of political prisoners were detained in mental hospitals. There they were isolated from friends and family, and many cases, forcibly medicated. Nazi Germany went even further: it murdered over 180,000 psychiatric patients.
Laws in most states allow child protective services agencies to forcibly medicate your children. Indeed, if you fail to administer drugs ordered by a physician or have your children submit to vaccinations, you can be imprisoned.
As The Washington Post observed:
“If seven-year-old Mozart tried composing his concertos today, he might be diagnosed with attention-deficit hyperactivity disorder and medicated into barren normality.”
The conversion of personality differences into psychiatric disorders, and the forced medication of children, is a dangerous trend. It is but a short step to extend these laws to adults who have a pattern of “negativistic, defiant, disobedient and hostile behavior toward authority figures.”
I’d prefer a different approach: institutionalizing the psychiatrists that came up with all these new disorders. Perhaps we could call their condition “overmedication psychosis.” And those of us with ODD, CD, or who simply don’t like the government telling us how to live our lives could breathe a bit easier.
Click here for the full report from The Sovereign Society.
Fidel Castro Showcases Book About Bilderberg Group
September 28, 2010
Associated Press
Will Weissert
HAVANA – Fidel Castro is showcasing a theory long popular both among the far left and far right: that the shadowy Bilderberg Group has become a kind of global government, controlling not only international politics and economics, but even culture.
The 84-year-old former Cuban president published an article Wednesday that used three of the only eight pages in the Communist Party newspaper Granma to quote — largely verbatim — from a 2006 book by Lithuanian-born writer Daniel Estulin.
Estulin’s work, “The Secrets of the Bilderberg Club,” argues that the international group largely runs the world. It has held a secretive annual forum of prominent politicians, thinkers and businessmen since it was founded in 1954 at the Bilderberg Hotel in Holland.
Castro offered no comment on the excerpts other than to describe Estulin as honest and well-informed and to call his book a “fantastic story.”
Estulin’s book, as quoted by Castro, described “sinister cliques and the Bilderberg lobbyists” manipulating the public “to install a world government that knows no borders and is not accountable to anyone but its own self.”
The Bilderberg group’s website says its members have “nearly three days of informal and off-the-record discussion about topics of current concern” once a year, but the group does nothing else.
It said the meetings were meant to encourage people to work together on major policy issues.
The prominence of the group is what alarms critics. It often includes members of the Rockefeller family, Henry Kissinger, senior U.S. and European officials and major international business and media executives.
The excerpt published by Castro suggested that the esoteric Frankfurt School of socialist academics worked with members of the Rockefeller family in the 1950s to pave the way for rock music to “control the masses” by diverting attention from civil rights and social injustice.
“The man charged with ensuring that the Americans liked the Beatles was Walter Lippmann himself,” the excerpt asserted, referring to a political philosopher and by-then-staid newspaper columnist who died in 1974.
“In the United States and Europe, great open-air rock concerts were used to halt the growing discontent of the population,” the excerpt said.
Castro — who had an inside seat to the Cold War — has long expressed suspicions of back-room plots. He has raised questions about whether the Sept. 11 attacks were orchestrated by the U.S. government to stoke military budgets and, more recently suggested that Washington was behind the March sinking of a South Korean ship blamed on North Korea.
Estulin’s own website suggests that the 9/11 attacks were likely caused by small nuclear devices, and that the CIA and drug traffickers were behind the 1988 downing of a jetliner over Lockerbie, Scotland, that was blamed on Libya.
The Bilderberg conspiracy theory has been popular on both extremes of the ideological spectrum, even if they disagree on just what the group wants to do. Leftists accuse the group of promoting capitalist domination, while some right-wing websites argue that the Bilderberg club has imposed Barack Obama on the United States to advance socialism.
Some of Estulin’s work builds on reports by Big Jim Tucker, a researcher on the Bilderberg Group who publishes on right-wing websites.
“It’s great Hollywood material … 15 people sitting in a room sitting in a room determining the fate of mankind,” said Herbert London, president of the Hudson Institute, a nonpartisan policy think tank in New York.
“As someone who doesn’t come out of the Oliver Stone school of conspiracy, I have a hard time believing it,” London added.
A call to a Virginia number for the American Friends of Bilderberg rang unanswered Wednesday and the group’s website lists no contact numbers.
Castro, who underwent emergency intestinal surgery in July 2006 and stepped down as president in February 2008, has suddenly begun popping up everywhere recently, addressing Cuba’s parliament on the threat of a nuclear war, meeting with island ambassadors at the Foreign Ministry, writing a book and even attending the dolphin show at the Havana aquarium.
Click here to read the full report from The Associated Press.
Obama To Make Internet Eavesdropping Easier
WASHINGTON — The Obama administration is drawing up legislation to make it easier for US intelligence services to eavesdrop on the Internet, including email exchanges and social networks, The New York Times said Monday.
The White House intends to submit a bill before Congress next year that would require all online services that enable communications to be technically capable of complying with a wiretap order, including being able to intercept and unscramble encrypted messages, the Times reported.
The services would include encrypted email transmitters like BackBerry, social networking websites like Facebook and peer-to-peer messaging software like Skype.
Federal law enforcement and national security officials are seeking the new regulations, arguing that extremists and criminals are increasingly communicating online rather than using phones.
“We’re talking about lawfully authorized intercepts,” said Federal Bureau of Investigation (FBI) general counsel Valerie Caproni.
“We’re not talking expanding authority. We’re talking about preserving our ability to execute our existing authority in order to protect the public safety and national security.”
Officials from the White House, Justice Department, National Security Agency, FBI and other agencies have been meeting in recent months to craft the proposals, the Times said.
But, citing officials familiar with the discussions, it said the participants had not yet agreed on important elements, such as how to define which entities are considered communications service providers.
President Barack Obama’s administration is seeking a broad mandate that would also apply to companies whose servers are operated abroad, such as Research in Motion, the Canadian maker of BlackBerry smartphones.
As an example, officials told the Times that investigators discovered that Faisal Shahzad, the suspect from the failed Times Square bombing in May, had been using a communication service without prebuilt interception capacity.
That meant that there would have been a delay before he could have been wiretapped, had he aroused suspicion beforehand, the officials said.
Click here to read the full article from AFP.
Businessman Buys Steroids & Guns On Blackwater’s Tab
September 27, 2010
The Nation
Jeremy Scahill
A Texas businessman who has worked extensively in Iraq claims that Blackwater paid him to purchase steroids and other drugs for its operatives in Baghdad, as well as more than 100 AK47s and massive amounts of ammunition on Baghdad’s black market. Howard Lowry, who worked in Iraq from 2003-2009, also claims that he personally attended Blackwater parties where company personnel had large amounts of cocaine and blocks of hashish and would run around naked. At some of these parties, Lowry alleges, Blackwater operatives would randomly fire automatic weapons from their balconies into buildings full of Iraqi civilians. Lowry described the events as a “frat party gone wild” where “drug use was rampant.” Lowry says he was told by Blackwater personnel that some of the men using the steroids he purchased were on the security detail of L. Paul Bremer, the original head of the Coalition Provisional Authority (CPA). Lowry also claims that Blackwater’s owner, Erik Prince, tried to enlist his help to win contracts for Blackwater with the Iraqi government using an off-shore security company, Greystone, which Prince owns. The purpose, Lowry says, was to conceal Greystone’s relationship to Blackwater.
Lowry made his statements in a deposition on September 10 as part of a whistleblower lawsuit brought by two former Blackwater employees. The suit was filed in 2008 by former employees Brad and Melan Davis. They allege that Blackwater tried to bill the US government for a prostitute for its men in Afghanistan and for strippers in New Orleans in the aftermath of Hurricane Katrina. The lawsuit claims that Prince personally benefitted from alleged fraud. The Nation obtained Lowry’s deposition from publicly available court filings.
Blackwater, Lowry alleges, paid for the steroids using company funds and the purchases were coordinated by Blackwater’s Iraq country manager. “Not only did I purchase the pharmaceuticals,” Lowry said in his deposition, “but I was also given money and asked to acquire syringes and other forms or modes of injection as well.” Lowry said that Blackwater used him to purchase the drugs and other devices because, unlike Blackwater personnel, he could move freely and discreetly around Baghdad. Lowry says he personally witnessed several Blackwater operatives injecting themselves with steroids.
Lowry says in the deposition that he was a close friend of Jerry Zovko, one of the four Blackwater men killed in the infamous ambush in Fallujah, Iraq in March 2004. Zovko, Lowry says, “provided me tremendous insight into the company and confirmed that the use of steroids and human growth hormone, testosterone, were pretty endemic to them and almost companywide.” Lowry said that it was a “wide-ranging problem, and this included individuals that were on [L. Paul] Bremer’s personal detail.” Bremer was guarded by Blackwater when he ran the CPA from 2003-2004. Lowry says he would purchase the drugs for Blackwater “by the case,” adding, “It was as large a quantity as I could get, which was usually a case.” He said that the “volume I was being asked to purchase on a daily basis was going up substantially as time went on.”
Lowry also claims that he purchased a wide variety of weapons, ammunition and armor for Blackwater on the black market in Baghdad. “I purchased no less than a hundred AK47s for Blackwater personnel to keep them safe,” Lowry says. Such purchases, he says he believed, were necessary because Blackwater was not adequately arming its personnel.
Lowry also describes instances of Blackwater personnel firing randomly at Iraqi pedestrians and into buildings for no apparent reason. He details one night where several Blackwater operatives were at his hotel drinking until 5am. When they left, Lowry says, they fired their weapons at random as they drove off. Lowry describes parties that he says some Blackwater personnel would throw at the al Hamra hotel in Baghdad that he says were like “a frat party” with rampant drug use:
One of the suites would be absolutely packed with gentlemen running around with either no clothes on, no shirt on. It was like a frat party gone wild. Drug use was rampant. There was cocaine all on the tables. There were blocks of hash, and you could smell it in the air…walking up to the door.
Lowry described one party where “there was a pile of cocaine that one Blackwater person had estimated to be over an ounce of coke.” Lowry said, “to me, considering the job that these gentlemen are doing…at that time [they] were protecting the US ambassador, Ambassador Bremer, seemed a little bit out—well, beyond out of control. And these parties were a weekly ritual.” Lowry alleges that at these parties on several occasions Blackwater personnel would pull out AK47s and go out onto the balcony and “would just spray the building next door, which housed Iraqi civilians.”
Lowry also says that he had several meetings with Erik Prince where Prince asked him for assistance in winning contracts with the Iraqi government for an off-shore company Prince owns called Greystone. It is registered in Barbados. Lowry, who says he knew the Iraqi Interior and Defense Ministers “very well,” claims Prince wanted to offer the Iraqi government Greystone’s training and security services. Lowry says that Prince stated “very clearly” to him that Greystone was “set up to deflect any liability, future liability, that he may have with respect to any weapons sales or any bodily harm or anything else, contract issues with both the US and the Iraqi governments.” Lowry claims the Iraqis were aware of Greystone’s connection to Blackwater and “detested” the companies.
Lawyers representing the self-exiled Blackwater owner have asked a federal judge in Virginia for a protective order against the tenacious lawyer who took Lowry’s deposition. For years, attorney Susan Burke has pursued Prince and Blackwater with a string of civil lawsuits. In August, Burke flew to Abu Dhabi in the United Arab Emirates, where Prince and his family have relocated, to conduct a seven-hour deposition of Prince in connection to the whistleblower claim she filed on behalf of the former Blackwater employees. After the deposition ended on August 23, according to Burke, Prince threatened to “come after” her.
Soon thereafter, Prince’s lawyers declared the entirety of the transcript of Prince’s deposition to be confidential material and asserted that it should be sealed. Prince’s attorneys filed papers in the case asking the judge to allow Prince and his lawyers to classify any information or documents Prince provides or any information or documents Burke obtains from Prince or Blackwater as “confidential” and therefore barred from public dissemination. Prince’s lawyers have also asked that all documents they provide in the case be destroyed or returned within 120 days of the conclusion of the case.
Prince’s lawyers have alleged that Burke intends to use the media to embarrass Prince and to litigate her case outside of court and have asked for a “gag order” against her and the other attorneys litigating the case. Burke, in her court filing, points out that the actions of Prince and his companies have generated tremendous publicity and attention. Burke writes:
Defendant Prince and his companies create the media stir by their own actions. Indeed, their misconduct has led to a series of indictments, charging letters from the State Department, and criminal trials. Indeed, Defendant Prince seeks publicity that serves his own ends. He voluntarily participated in a Vanity Fair interview, pressing his view that anyone who criticizes his misconduct must have a “political agenda.” Defendant Prince voluntarily cooperated with a book about his life, called Master of War. In the book, he voluntarily revealed, among other things, that he fathered a child out of wedlock and cheated on his wife who was dying of cancer.
On September 22, Burke filed a motion opposing the gag order and what she sees as Prince’s attempt to “seal everything.” In her motion, Burke reveals that she provided the US State Department with a transcript of the deposition for review of potentially classified material. A State Department contracting official wrote, “As contracting officer I do not require any redactions to the subject transcript of the Erk Prince deposition before it is made publicly available.”
In arguing against a gag order, Burke writes that media coverage results in witnesses coming forward who will “be helpful in showing the jury that [her clients'] claims of widespread fraud and misconduct have merit.” To support her argument, Burke cited Howard Lowry, whom she says contacted her after seeing media reports on Prince and Blackwater.
Lowry says he contacted Burke “because I believe there is a tremendous lack of moral and business ethics on behalf of the owner of the company and, I believe, companywide.” He added, “Because of that, I feel that numerous families of individuals of Blackwater employees that have been killed on the job are not getting the true story.”
Click here to read the full report from The Nation.
The Truth Behind The Credit Collapse
September 27, 2010
Web of Debt
Ellen Brown
While local banks are held in check by the new banking czars in Basel, Wall Street’s “shadow banking system” has hardly been curbed by regulators at all; and it is here that the 2008 credit crisis was actually precipitated. The banking system’s credit machine is systemically flawed and needs a radical overhaul.
On September 13, the Bank for International Settlements issued heightened capital requirements that will make lending even more difficult for local banks, which do most of the consumer and small business lending today. The new rules are ostensibly designed to prevent a repeat of the 2008 credit collapse, but they fail to address its real cause, which involves a “shadow” banking system that has largely escaped regulation.
What went wrong in September 2008 was not that the existing Basel II capital requirements were too low but that banks found a way around the rules. The Basel II rules base a bank’s capital requirement on how risky its loan book is, and banks can make their books look less risky by buying unregulated “insurance contracts” known as credit default swaps (CDS). This insurance, however, proved to be a fraud, when insurer AIG went bankrupt on September 15, 2008. The credit collapse that followed has normally been blamed on the collapse of the subprime housing market. But according to Yale economist Gary Gorton (whose views were recently embraced by Fed Chairman Ben Bernanke), the subprime problem was not itself sufficient to trigger a global credit freeze. What it did trigger was an old-fashioned bank run, in the not-so-familiar market known as the shadow banking system.
Bank runs don’t generally occur in the traditional banking system anymore, because (a) depositors are now protected by FDIC insurance, and (b) banks that run out of reserves can borrow from the Federal Reserve, which is empowered to create money ex nihilo (out of nothing). But FDIC insurance covers only $250,000 in deposits, and there is a massive and growing demand for banking by large institutional investors – pension funds, mutual funds, hedge funds, sovereign wealth funds – which have millions of dollars to park somewhere between investments. They want an investment that is secure, that provides them with a little interest, and is liquid like a traditional deposit account, allowing quick withdrawal.
The shadow banking system evolved in response to this need, operating largely through the repo market. “Repos” are sales and repurchases of highly liquid collateral, typically Treasury debt or mortgage-backed securities. The collateral is bought by a “special purpose vehicle” (SPV), which acts as the shadow bank. The investors put their money in the SPV and keep the securities, which substitute for FDIC insurance in a traditional bank. (If the SPV fails to pay up, the investors can foreclose on the securities.) To satisfy the demand for liquidity, the repos are one-day or short-term deals, continually rolled over until the money is withdrawn. This money is used by the banks for other lending, investing or speculating. But that puts the banks in the perilous position of Jimmy Stewart in “It’s a Wonderful Life,” funding long-term loans with short-term borrowings. When the investors get spooked for some reason and all pull their money out at once, the banks can no longer make loans and credit freezes.
In September 2008, investors were spooked when the mortgage-backed securities backing their repo “deposits” proved not to be “triple A” as represented. But the next time it might be something else, and Basel III has not fixed this systemic weakness. Arguably, the weakness cannot be fixed under the current scheme of private banking and credit. As noted in an article on Seeking Alpha by The Business Insider:
“Our financial system remains vulnerable to another credit crunch, with many of the same exact features as the last. All it needs is someone to strike the match of panic.”
The question is how to eliminate this systemic risk:
“Regulate shadow banking more tightly, and you probably have to also provide government backstops. Shudder. Try to shut the thing down or restrict it and you suck credit out of the system, credit which much of the non-financial ‘real’ economy uses and needs.”
The real economy needs credit, and choking it off by over-regulating the banks will kill the real economy. Indeed, according to Gary Gorton, the shadow banking system evolved because banks were already so over-regulated that they could not turn a profit. He writes:
“Holding loans on the balance sheets of banks is not profitable. . . . This is why the parallel or shadow banking system developed. If an industry is not profitable, the owners exit the industry by not investing; they invest elsewhere. Regulators can make banks do things, like hold more capital, but they cannot prevent exit if banking is not profitable. ‘Exit’ means that the regulated banking sector shrinks, as bank equity holders refuse to invest more equity.”
Click here to read the full report from Web of Debt.
