Tag Archives: Blowback

Twenty Years on, We’ve Learned Nothing From 9/11, by Ron Paul

Those who cannot learn from the past are destined for high office or other well-paid, prestigious Washington sinecures. From Ron Paul at ronpaulinstitute.org:

Nothing upset the Washington Beltway elites more than when in a 2007 presidential debate I pointed out the truth about the 9/11 attacks: they attacked us because we’ve been in the Middle East, sanctioning and bombing the civilian population, for decades. The 9/11 attackers were not motivated to commit suicide terrorism on the Twin Towers and Pentagon because they dislike our freedoms, as then-President Bush claimed. That was a self-serving lie.

They hated – and hate – us because we kill them for no reason. Day after day. Year after year. Right up until just a few days ago, when President Biden slaughtered Zemari Ahmadi and nine members of his family – including seven children – in Afghanistan. The Administration bragged about taking out a top ISIS target. But they lied. Ahmadi was just an aid worker, working for a California-based organization, bringing water to suffering Afghan village residents.

This horror has been repeated thousands of times, over and over, for decades. Does Washington believe these people are subhuman? That they somehow don’t care about their relatives being killed? That they don’t react as we would react if a foreign power slaughtered our families?

Former Secretary of State Madeleine Albright famously suggested in an interview that killing half a million Iraqi children with sanctions designed to remove Saddam Hussein from power was “worth it.” It was an admission that the lives of innocents mean nothing to the Washington elite, even as they paint their murderous interventions as some kind of “humanitarian liberation.” The slogan of the US foreign policy establishment really should be, “No Lives Matter.”

The Washington foreign policy elites – Republicans and Democrats – are deeply corrupt and act contrary to US national interests. They pretend that decades of indiscriminate bombing overseas are beneficial to the victims and keep us safer as well. That is how they are able, year after year, to convince Congress to hand over a trillion dollars – money taken directly and indirectly from average Americans. They use fear and lies for their own profit. And they call themselves patriots.

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There Will Be Blowback, In Mostly Good Ways, by Jeffrey A. Tucker

At some point the pressure cooker explodes and people start thinking and acting for themselves and not according to the dictates of would-be dictators. That may lead to good things, today’s silver lining in the current clouds. From Jeffrey A. Tucker at aier.org:

Two months ago, it had been mandatory in my local grocery to use only shopping bags brought from home. Plastic bags were illegal by local ordinance. Then the virus hit. Suddenly the opposite was true. It was illegal to bring bags from home because they could spread disease. Plastic bags were mandatory. As a huge fan of plastic bags, I experienced profound Schadenfreude.

It’s amazing how the prospect of death clarifies priorities.

Before the virus, we indulged in all sorts of luxuries such as dabbling in dirtiness and imagining a world purified by bucolic naturalness. But when the virus hit, we suddenly realized that a healthy life really matters and that natural things can be very wicked. And then when government put everyone under house arrest and criminalized freedom itself, we realized many other things too. And we did it fast.

Lots of people are predicting how life will fundamentally change in light of our collective experience this last month. I agree but I don’t think it will turn out quite as people think. This whole period has been an unconscionable trauma for billions of people, wrecking lives far beyond what even the worst virus could achieve. I’m detecting enormous, unfathomable levels of public fury barely beneath the surface. It won’t stay beneath the surface for long.

Our lives in the coming years will be defined by forms of blowback in the wake of both the disease and the egregious policy response, as a much needed corrective. The thing is that you can’t take away everyone’s rights, put a whole people under house arrest, and abolish the rule of law without generating a response to that in the future.

1. Blowback Against Media

I’m a long-time fan of the New York Times. Jeer if you want but I’ve long admired their reporting, their professionalism, their steady hand, their first draft of history, even if I don’t share the paper’s center-left political bent.

Something about this virus caused the paper to go completely off the rails. In early March, they began to report on it as if it were the Black Death, suggesting not just closing schools and businesses but actually calling for a complete totalitarian policy. It was shocking and utterly preposterous. The guy who wrote that article has a degree in rhetoric from Berkeley and yet he was calling the shots on the paper’s entire response to disease on a national level. They’ve gone so far as to falsify dates in their reporting in order to manipulate the timeline (I called them out on a case in point; the paper made the change but never admitted the error.)

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Things Take a Turn, by James Howard Kunstler

The 2020s are definitely going to be different than the 2010s. From James Howard Kunstler at kunstler.com:

Around the same time that most Americans set their clocks ahead this weekend, something more momentous shoved the world into an epic phase-change, and the modern era, with all its mighty baggage, was finally swept away, along with that single lost hour of darkness. We’re in a new world, and one night later, out on the freeway of history, the engine of the global economy threw a rod. The chauffeur is still standing alongside the stricken vehicle in the breakdown lane, scratching his head while sour-smelling smoke wafts up from the hood.

You’d think that truly earthshaking events like that might change the so-called narrative, but The New York Times was at it again this morning with this front-page op-ed purporting to explain all the sorrows of our times:

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Believing That War Has Consequences, by Lucy Steigerwald

Violence begets violence and evil begets evil. From Lucy Steigerwald at antiwar.com:

A February NBC news poll reveals some dramatic diversity within the minds of Donald Trump’s America. The topics covered are varied, and include Americans’ current feelings about Russia, and their worries over a future major war (56 percent are very or somewhat worried). One other question caught my eye, however, and that was a choice of two statements, asking respondents to pick the one closer to what they believe. They were “using overwhelming military force is the best way to defeat terrorism” or “relying too much on military force creates hatred that leads to more terrorism.” Surprisingly, the split was nearly even, but the latter won out 49 percent to 47.

Depending how a poll is phrased, you can get a large number of people to agree to all sorts of things, some of which are awful. However, that NBC bothered to ask about this, and that it rang true for so many people feels new and strange for those of us who grew up with the war on terror, and who have been accused more than once of condoning terrorism because we wished to explain its motivations.

Blowback is a CIA term that former Rep. Ron Paul tried his best to popularize as an explanation for terrorist attacks, and other forms of violence. Fittingly, it was first used in a 1954 CIA document about the consequences of the British and US-backed 1953 Iranian coup (the consequences being, well, everything that happened in Iran after 1953).

Outside of certain circles, “blowback” and Paul himself were relatively unknown until, during the 2008 presidential campaign, the Texas Congressman went up against former New York Mayor and 9/11-panderer Rudy Giuliani over why those attacks happened.

To continue reading: Believing That War Has Consequences

The Lesson of Blowback and 9/11, by Lucy Steigerwald

From Lucy Steigerwald at antiwar.com:

While the death count still seemed like it might number in the tens of thousands, a few people remembered to warn against a disproportionate reaction to the 9/11 attacks. Perhaps the oddest thing about these events which provoked two wars and a constant drone presence in myriad countries, is that even on that day – that week, that month – a few people rose above the terrified, vengeful fray. We have made one disastrous foreign policy decision after another since September 11. Yet many people in the US, particularly our leaders and pundits, still seem comfortable with the spirit of Richard Kagan’s 9/11 suggestion that “Congress, in fact, should immediately declare war. It does not have to name a country.”

In many ways, in spite of the catastrophically late officially acceptable opinion that War in Iraq equals bad, and the unpopularity of the war in Afghanistan, we’re still in that mindset. We (barring you, perhaps, Antiwar reader) still don’t quite buy that people in other countries are real and worthy of life. Not when the US is feeling persecuted, at least.

On September 12, Antiwar.com published a piece by the late Harry Browne, writer and candidate for president with the Libertarian Party. It’s still a revelation to read, especially with that date. With none of the necessary coyness of of the mainstream politician or pundit, Browne noted that the victims of 9/11 were innocent, that the perpetrators were guilty, but that the crime should shock nobody. Browne asked: “When will we learn that we can’t allow our politicians to bully the world without someone bullying back eventually?” After that, Browne listed the interventions by the last several US presidents. Clinton with Sudan, Serbia, and Iraq, George H.W. Bush with Panama and Iraq, Reagan with Grenada and Libya.

By using the exact same word (“bullying”) to allude to the US government’s crimes and that of the 9/11 hijackers, Browne was saying something you still can’t say – 9/11 was exactly as unacceptable as what the US has done to other nations. Not because these other nations, leaders, or even people are angels, as a warhawk might strawman. Not because you believe only the US can do bad. But because when you arrogantly intrude in other nations, and cause real people real, irreversible harm, they notice it. As Brown writes, “Did we think the people who lost their families and friends and property in all that destruction would love America for what happened?

To continue reading: The Lesson of Blowback and 9/11

Financial Blowback, by Robert Gore

Blowback is a government action that leads to a result directly opposite the government’s intent, a manifestation of the Command and Control Futility Principle (see “Crisis Progress Report,” SLL, 1/29/15). Designed to reduce terrorism and terrorist infiltration, the US’s war on terrorism has created blowback: more terrorism and chaos throughout the Middle East, and a flood of refugees into Europe, some of whom are undoubtedly Islamic extremists.

There is another type of blowback, lurking within the global financial system, that may prove just as dangerous. Since the financial crisis, government debt and debt monetization have been embraced to promote economic growth. New regulations have been implemented to address financial risks.

The realization grows that governments borrowing money, and central banks buying it and other debt, have produced little in the way of economic growth (see “The Song Remains the Same“, from the Economic Cycle Research Institute, SLL 3/25/15). What is not generally recognized is the blowback potential: that the supposed remedies will ultimately make the disease worse. Artificially low rates lead to overproduction and leveraged speculation. Expanding debt increases the debt service burden.

The burgeoning oil patch disaster is a sample of blowback. The fracking boom was powered by debt, which may have made economic sense when oil was over $100 per barrel, but is a millstone now that it is below $50 per barrel. Wells are being shut down, investment slashed, and employees fired—economic contraction, the opposite of economic growth. Similar production cutbacks are happening in a number of other natural resources: iron, coal, and precious metals. Declining volumes of world trade and all-time lows in the Baltic Dry Index point to continuing shrinkage in production and further contraction.

That contraction impairs the ability of debtors to service their debt, and the margin of error for the most heavily indebted global economy in history is nil. Debt restructurings and bankruptcies in oil and other natural resources have already begun. Creditors are pulling in their horns. Shrinking credit and production will be a mutually reinforcing vicious cycle that spreads to other sectors, a ticking time bomb. Governments and central banks are encumbered with much more debt than they had in 2008, and will have little or no leeway to forestall the workings of this cycle through debt expansion and monetization.

Debt being the epicenter of the coming crisis, it’s no surprise that time bombs lurk in credit markets. Bond math is such that a one percent move up in yield produces a larger loss, in percentage terms, on bonds when yields are low than when they are high. Thus, when central bank interest rate suppression ends, either due to central bank policy change or market spasms, those owning government bonds will suffer substantial losses. Ironically, the largest owners of government bonds are central banks—they have set themselves up for their own blowback.

By sucking up much of the available float in government bonds, they have already inflicted damage on the workings of those markets. Those bonds are used as collateral against short-term loans in “repo” transactions (short for repurchase—the borrower sells the bonds and agrees to repurchase them; the difference in prices is the implicit interest) that allow the market to function. Without them, the markets seize up as collateral-starved lenders actually pay interest, rather than receive it with the government bond collateral they received for their cash. Many of those seeking collateral are short bonds, so removing bonds from the market reduces the number of shorts.

By “hogging” the bond market, central banks have crowded out the shorts that would provide bids and liquidity if the market were to drop. Diminished liquidity is exacerbated by new regulations that treat less favorably, in terms of capital ratios, bonds banks hold in trading portfolios versus bonds they hold to maturity, as investments. Banks were the primary market makers for bonds. At a time when interest rates are so low they have nowhere to go but up (and bond prices down), the pool of bond bidders has shrunk. The new banking regulations were intended to make banks safer, but the blowback effect will be to make the bond market considerably less so.

Shallow liquidity is a natural consequence of a high degree of leverage, in any market. Zero interest rate policies promote leverage. If a trade is crowded with speculators who have put up a tiny percentage of their trades and borrowed the rest at microscopic rates, at the first hint of trouble they look for a bid, which disappears. Leverage, as the old trading adage goes, is a two-edged sword. Cheap debt that has fueled the steady ascent of markets since the financial crises will be responsible for terrifying plunges as markets choke on government and central bank blowback and fire sale bids are the only ones available. Witness January’s Swiss franc debacle, recent vertiginous drops in oil and other commodities‘ prices, and the stock market’s “flash crash” back in May of 2010.

Another trading adage: sell when you can, not when you have to. Countless traders who thought they could get out in time when markets went against them have been carried out on stretchers. Liquidity can be as evanescent as a mirage oasis in the desert. Everything that central banks and governments have done since the last financial crisis guarantees a mouth full of sand when the next crisis hits. The financial blowback will be fearsome, a crushing reaction to what proceeded it, and the only way to avoid becoming collateral damage will be to get out of the line of fire before it begins.

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