WASHINGTON — The Treasury Department will propose on Monday that Congress give the Federal Reserve broad new authority to oversee financial market stability, in effect allowing it to send SWAT teams into any corner of the industry or any institution that might pose a risk to the overall system.
The proposal is part of a sweeping blueprint to overhaul the nation’s hodgepodge of financial regulatory agencies, which many experts say failed to recognize rampant excesses in mortgage lending until after they set off what is now the worst financial calamity in decades.
Democratic lawmakers are all but certain to say the proposal does not go far enough in restricting the kinds of practices that caused the financial crisis. Many of the proposals, like those that would consolidate regulatory agencies, have nothing to do with the turmoil in financial markets. And some of the proposals could actually reduce regulation.
According to a summary provided by the administration, the plan would consolidate an alphabet soup of banking and securities regulators into a powerful trio of overseers responsible for everything from banks and brokerage firms to hedge funds and private equity firms.
While the plan could expose Wall Street investment banks and hedge funds to greater scrutiny, it carefully avoids a call for tighter regulation.
The plan would not rein in practices that have been linked to the housing and mortgage crisis, like packaging risky subprime mortgages into securities carrying the highest ratings.
The plan would give the Fed some authority over Wall Street firms, but only when an investment bank’s practices threatened the entire financial system.
And the plan does not recommend tighter rules over the vast and largely unregulated markets for risk sharing and hedging, like credit default swaps, which are supposed to insure lenders against loss but became a speculative instrument themselves and gave many institutions a false sense of security.
Parts of the plan could reduce the power of the Securities and Exchange Commission, which is charged with maintaining orderly stock and bond markets and protecting investors. The plan would merge the S.E.C. with the Commodity Futures Trading Commission, which regulates exchange-traded futures for oil, grains, currencies and the like.
The blueprint also suggests several areas where the S.E.C. should take a lighter approach to its oversight. Among them are allowing stock exchanges greater leeway to regulate themselves and streamlining the approval of new products, even allowing automatic approval of securities products that are being traded in foreign markets.
The proposal began last year as an effort by Henry M. Paulson Jr., secretary of the Treasury, to make American financial markets more competitive against overseas markets by modernizing a creaky regulatory system.
His goal was to streamline the different and sometimes clashing rules for commercial banks, savings and loans and nonbank mortgage lenders.
“I am not suggesting that more regulation is the answer, or even that more effective regulation can prevent the periods of financial market stress that seem to occur every 5 to 10 years,” Mr. Paulson will say in a speech on Monday, according to a draft. “I am suggesting that we should and can have a structure that is designed for the world we live in, one that is more flexible.”
Congress would have to approve almost every element of the proposal, and Democratic leaders are already drafting their own bills to impose tougher supervision over Wall Street investment banks, hedge funds and the fast-growing market in derivatives like credit default swaps.
But Mr. Paulson’s proposal for the Fed echoes ideas championed by Representative Barney Frank, the Massachusetts Democrat who is chairman of the House Financial Services Committee.
Both see the Fed overseeing risk across the entire financial spectrum, but Mr. Frank is likely to favor a stronger Fed role and to subject investment banks to the same rules that commercial banks now must follow, especially for capital reserves.
The Treasury plan would let Fed officials examine the practices and even the internal bookkeeping of brokerage firms, hedge funds, commodity-trading exchanges and any other institution that might pose a risk to the overall financial system.
That would be a significant expansion of the central bank’s regulatory mission.
When Fed officials agreed this month to rescue Bear Stearns, once the nation’s fifth-largest investment bank, they pointedly noted that the Fed never had the authority to monitor its financial condition or order it to bolster its protections against a collapse.
In two unprecedented moves, the Fed engineered a marriage between JPMorgan Chase and Bear Stearns, lending $29 billion to JPMorgan to prevent a Bear bankruptcy and a chain of defaults that might have felled much of the financial system.
For the first time since the 1930s, the Fed also agreed to let investment banks borrow hundreds of billions of dollars from its discount window, an emergency lending program reserved for commercial banks and other depository institutions.
But Mr. Paulson’s proposal would fall well short of the kind of regulation that Democrats have been proposing. Mr. Frank and other senior Democrats have argued that investment banks and other lightly regulated institutions now compete with commercial banks and should be subject to similar regulation, including examiners who regularly pore over their books and quietly demand changes in their practices.
In a recent interview, Mr. Frank said he realized the need for tighter regulation of Wall Street firms after a meeting with Charles O. Prince III, then chairman of Citigroup.
When Mr. Frank asked why Citigroup had kept billions of dollars in “structured investment vehicles” off the firm’s balance sheet, he recalled, Mr. Prince responded that Citigroup, as a bank holding company, would have been at a disadvantage because investment firms can operate with higher debt and lower capital reserves.
Senator Charles E. Schumer, Democrat of New York, has taken a similar stance.
“Commercial banks continue to be supervised closely, and are subject to a host of rules meant to limit systemic risk,” Mr. Schumer wrote in an op-ed article on Friday in The Wall Street Journal. “But many other financial institutions, including investment banks and hedge funds, are regulated lightly, if at all, even though they act in many ways like banks.”
Mr. Paulson’s proposal is likely to provoke bruising turf battles in Congress among agencies and rival industry groups that benefit from the current regulations.
Administration officials acknowledged on Friday that they did not expect the proposal to become law this year, but said they hoped it would help frame a policy debate that would extend well after the elections in November.
In a nod to the debacle in mortgage lending, the administration proposed a Mortgage Origination Commission to evaluate the effectiveness of state governments in regulating mortgage brokers and protecting consumers.
The bulk of the proposal, however, was developed before soaring mortgage defaults set off a much broader credit crisis, and most of the proposals are geared to streamlining regulation.
This plan would consolidate a large number of regulators into roughly three big new agencies.
Bank supervision, now divided among five federal agencies, would be led by a Prudential Financial Regulator, which could send examiners into any bank or depository institution that is protected by either federal deposit insurance or other federal backstops. It would eliminate the distinction between “banks” and “thrift institutions,” which are already indistinguishable to most consumers, and shut down the Office of Thrift Supervision.
Any effort to merge the Commodity Futures Trading Commission with the S.E.C. is likely to provoke battles.
Yet another proposal would, for the first time, create a national regulator for insurance companies, an industry that state governments now oversee.
Administration officials argue that a national system would eliminate the inefficiencies of having 50 different state regulators, who have jealously guarded their powers and are likely to fight any federal encroachment.
Arthur Levitt, a former S.E.C. chairman who has long pushed for stronger investor protection, said his first impression of the plan was positive. Even though the S.E.C.’s powers might be reduced, Mr. Levitt said, the plan would create a broader agency to regulate business conduct in all financial services.
“It’s a thoughtful document,” he said. “I’m intrigued by the fact that it puts an emphasis on investor protection, and that it establishes an agency specifically for that purpose, which would operate across all markets. I think that’s a very constructive first step.”
Recession ? Bring it on ! The economy is an illusion created by power brokers to fool the wage slaves into watching an imaginary score board. the US/world economy has been in a recession for the last 10 years. The US economist are using the "market" and the GNP to gauge the "economy". The market is dollar rated, the Fed has been dumping dollars to keep the market prices high, while reducing the "value" of everything else. The GNP goes up during disasters(911,Katrina, car accidents)and wars!
If you were to interpret "white" to be the ruling elite and "black" to be the rest of us, this guy makes a lot of sense. He is basically de-constructing the illusion of the American Dream...America was founded by elitists to be run by the elite, everyone else is supposed to fall in line and take what they are given. Now shut the F up and go back to work. If you are good we will give you more TV channels and a cell phone that makes pancakes
PITTSBURGH (March 20) - A U.S. House committee chairman has begun an investigation into the electrocutions of at least 12 service members in Iraq, including that of a Pittsburgh soldier killed in January by a jolt of electricity while showering.
Staff Sgt. Ryan Maseth
Staff Sgt. Ryan Maseth, here in an undated photo, was electrocuted while showering at his barracks in Baghdad. His family is suing KBR, the contractor responsible for maintaining his quarters in the Iraqi capital. Rep. Henry Waxman, chairman of the House Committee on Oversight and Government Reform, said Wednesday he has asked Defense Secretary Robert Gates to hand over documents relating to the management of electrical systems at facilities in Iraq.
Staff Sgt. Ryan Maseth, 24, died January 2 of cardiac arrest after being electrocuted while showering at his barracks in Baghdad.
Also Wednesday, Maseth's parents filed a wrongful death lawsuit in Allegheny County Court against KBR Inc., the Houston-based contractor responsible for maintaining Maseth's barracks.
The lawsuit, which seeks unspecified damages and costs, alleges that KBR allowed U.S. troops to continue using electrical systems "which KBR knew to be dangerous and knew had caused prior instances of electrocution."
"I expected that if I lost one of my sons [in the war], it would be due to an [improvised explosive device] or firefight," Maseth's mother, Cheryl Harris, told The Associated Press on Wednesday. "I never expected to hear he would be electrocuted, that something so senseless happened to him."
An Army investigation found that his death was due to improper grounding of the electric pump that supplied water to the building, Waxman said. Maseth died after an electrical short in the pump sent a current through the pipes, the California Democrat wrote in his letter.
Chris Isleib, a Defense Department spokesman, said that the Pentagon has turned the matter over to the department's inspector general for a full investigation.
Since 2003, at least 12 service members have died in Iraq as a result of electrocution, according to the Army and Marine Corps.
In October 2004, Waxman said in his letter, the Army issued a safety alert that noted five soldiers had been electrocuted that year and improper grounding was a factor in nearly all of the cases.
The letter did not give the names of victims other than Maseth. Waxman asked that his committee be provided investigative reports on the dead soldiers and reports and communications regarding electrical grounding in military facilities in Iraq.
In a January 21 memo responding to questions from Maseth's family, the Army's criminal investigations division said the Chinese-made pump was acquired before KBR took over maintenance of the building and did not meet U.S. safety standards.
KBR declined to comment on the lawsuit Wednesday, but said it would cooperate with agencies investigating Maseth's death. The company was formerly owned by Halliburton Co., the oil services conglomerate once led by Vice President Cheney.
Harris said the military initially did not tell her that her son was electrocuted, and then told her he died "with a small electrical appliance in the shower." Only later did she learn the truth, she said.
The investigation was sought by Rep. Jason Altmire, a Democrat who represents a district north of Pittsburgh.
Copyright 2008 The Associated Press. The information contained in the AP news report may not be published, broadcast, rewritten or otherwise distributed without the prior written authority of The Associated Press. All active hyperlinks have been inserted by AOL. 2008-03-20 16:42:18
SOME HAVE SPECULATED THAT IN ADDITION TO FISA, CONGRESS WAS DISCUSSING THE "CONTINUATION OF GOVERNMENT" IN THE EVENT OF A "STATE OF EMERGENCY"
THE PREVIOUS CONTRA HEARINGS OF 1983 REVEALED THAT SUCH A PLAN EXISTS !
WHAT IS THE CLERGY RESPONSE TEAM ???
Video compilation about continuity of government plans for martial law including the KSLA News report of the 26,000 pastors recruited for handling the people during a martial law take over.
There are over 800 camps throughout the United States. Recently 26,000 pastors were recruited by FEMA(Federal Emergency Management Association) to instruct their congregations that in case of an emergency they are to peacefully hand over their arms and their children and go to the camps. In a case like Hurricane Katrina, people were starving, and had no home. They had no choice but to go to the FEMA camps or die of starvation. Is this the choice you want to be left with in the event of a local or national emergency, or might it be smarter to prepare now with emergency food, water and supplies?
To its 117 elderly residents, Wesley Acres is simply a peaceful place to pass their twilight years.
Only when viewed from above does it become apparent that the retirement home is built in the shape of a giant swastika.
Following complaints, steps are being taken to alter the shape of the 1980-built establishment in Decatur, Alabama, so it is no longer a symbol of Nazi power.
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Unmistakeable: It's hard to argue the building looks like anything but a swastika Enlarge the image
But the question remains: Was Wesley Acres merely an accident or an expression of far-Right beliefs by its planners?
Prompted by complaints from a Jewish activist, the agency that owns the government-funded building is planning to alter its shape to disguise the Nazi symbol.
Avrahaum Segol, an Israeli-American researcher, claims the swastika shape is homage to German scientists who designed the V2 rockets launched against Allied targets in World War II.
The scientists were brought to nearby Huntsville after the war to work on the NASA spaceships which would eventually put man on the moon.
Mr Segol calls the Alabama retirement home a "sister building" to a swastika-shaped barracks at Naval Base Coronado in California and says they were both part of a government-funded conspiracy to honour Nazis.
But Mike Giles, a lawyer for the Methodist Homes Corporation of Alabama, said the conspiracy claims are "ridiculous," adding: "It was certainly not intentional."
"The difficulty is there are a limited number of options for fixing a building that has been there for some time.
"We have to come up with a way to fix an appearance that we want solved and not hurt our residents."
Wesley Acres provides government-subsidized housing for 117 low-income people ages 62 and above. Most have no reason to suspect their hallways take on a sinister shape.
The one-story building, designed in the mid-1970s and completed in 1980, underwent £500,000 alteration in 2001 with funding from the U.S. Department of Housing and Urban Development following complaints by Democratic Sen. Howell Heflin, who has since died.
But the addition of two wings did little to hide the offensive shape - and in some ways accentuates it.
Options for the new renovations include the addition of covered porches or other outdoor areas.
The latest push to rid the landscape of the broken cross shape follows complaints from Segol, the same Israeli-American researcher who last fall helped publicise a swastika-shaped barracks at Naval Base Coronado in San Diego.
The Navy said it would spend about £300,180 to alter the building, which opened in the 1960s, but the work has not yet been done.
Segol calls the Alabama retirement home a "sister swastika" to the building in California and says they were both part of a tangled, government-funded conspiracy to honour Nazis.
The shape of the retirement centre is evident in satellite photos available on the Internet.
But it is located in a residential section in a city with few tall buildings, and many in Decatur have no idea Wesley Acres resembles a swastika.
Mr Giles said any changes to the building must be relatively inexpensive since the agency lacks money for an elaborate solution.
Planners are considering modifications, he said, "so that from the air it takes your eye away from what was originally there."
PARIS (Reuters) - The U.S. economy lost the title of "world's biggest" to the euro zone this week as the value of the dollar slumped in currency markets.
Taking the gross domestic product of both economies in 2007, the combined GDP of the 15 countries which use the euro overtook that of the United States when the European currency surged to a record high of more than $1.56 per euro.
"The curious outcome of breaching this latest milestone is that the size of the euro zone's annual output has now exceeded that of the U.S.," the economics department of Goldman Sachs, the Wall Street investment bank, said in a note to clients.
Taking official estimates of 2007 GDP -- $13,843,800 billion for the United States and 8,847,889.1 billion euros for the euro zone -- the economy of the latter passed the United States once converted into dollars, shortly after the euro topped $1.56.
The dollar sank to $1.5688 per euro late in European trading hours on Friday, at which rate the euro zone's 2007 GDP equates to $13,880,568.4 billion.
The 2007 GDP estimates are as published by the U.S. Commerce Department's Bureau of Economic Analysis and provided to Reuters on request for the euro zone by Eurostat, the European Union's statistics office.
(Writing by Brian Love; editing by Stephen Nisbet)
YOU KNOW THE ECONOMY IS F*CKED WHEN THESE TWO GIANTS ARE SUCKING AIR !!!
Big American finance houses have collapsed before. Continental Illinois required a $4.5bn (£2.25bn) bail-out in 1984 after coming to grief in Texas as the oil boom deflated.
The giant hedge fund Long Term Capital Management was saved by a club of banks in 1998 under the guidance New York Federal Reserve. The fund blew up after Russia's default, which ravaged its portfolio of Danish, Italian and Spanish bonds.
Bear Stearns bank: Bear Stearns has been exposed as a bank saddled with toxic sub-prime debt Bear Stearns bank has been hit by the sub-prime mortgage crisis
On both occasions the US economy was in rude good health. The damage was quickly contained.
The implosion of Bear Stearns is more dangerous.
A host of other banks, broker dealers, and hedge funds have played the same game, deploying massive leverage at the top of the credit bubble to eke out extra yield. Dozens of them are saddled with the same toxic debt - sub-prime property, credit cards, auto loans, and mountains of unsold paper from the merger boom.
This time the market for default insurance is flashing bright red warning signals across the entire spectrum of US finance.
The swap spreads on Lehman Brothers rocketed to 465 yesterday, mirroring the moves in Bear Stearns debt days before. Fannie Mae and Freddie Mac - the venerable agencies created by Roosevelt that underpin 60pc of the $11 trillion mortgage market - had a heart attack on Monday. Their bonds were in free-fall, threatening to set off another cascade of bank writedowns.
These are not sub-prime outfits. They sit at the apex of the US mortgage credit industry. Hence the dramatic move by the Fed this week to offer a $200bn lifeline, agreeing to accept Fannie Mae and Freddie Mac issues as collateral.
Had the Fed delayed, many traders believe Wall Street would have plunged through resistance levels risking a full-fledged crash.
The 'monoline' bond insurers - MBIA, Ambac, and others - that guarantee most of the $2,600bn market for US municipal bonds have seen their shares collapse by 90pc since the Autumn.
They are still battling to raise enough to capital to save their 'AAA' ratings. Should they fail, the insured bonds will be downgraded in lockstep. Pension funds would be forced to liquidate huge holdings. As New York Governor Eliot Spitzer said before his own liquidation, such an outcome is too dreadful to contemplate.
You have to go back to the banking crisis of the Great Depression to find a moment when the financial system as a whole seemed so close to the precipice.
Although 4,000 US banks failed in the early 1930s (mostly small ones), it was a long-drawn out affair. The bank runs began in the Prairies as falling food prices caused farmers to default in 1930. It seemed to be a local problem.
The crisis reached New York in December 1930 when the Bank of the United States succumbed to panic withdrawals. Legend has it that the 'WASP' clearing banks refused to back a rescue because of the bank's Jewish links.
In those days the contagion spread slowly to the rest of the world. It is much swifter now. The Swiss bank UBS has suffered US sub-prime losses on a scale to match Merrill Lynch and Citigroup, thanks to the curse of mortgage securities.
"We are now experiencing the first truly major crisis of financial globalisation," said the Swiss central bank governor Philipp Hildebrand this week.
"Never before have banks seen such destruction of their balance sheets in such a short time. Moreover, there are signs that the problems are spreading. The risk premiums on commercial property, consumer credit and corporate loans have risen sharply," he said.
Debt levels have been much higher than in the Roaring Twenties; the new-fangled tools of structured credit are more opaque: the $415 trillion nexus of derivative contracts is untested. Nobody knows for sure if the counter-parties are able to deliver on vast IOUs, or whether the construct is built on sand.
What keeps Federal Reserve officials turning at night is fear that the "financial accelerator" will now set off a vicious downward spiral. There is a risk of "very adverse economic outcomes," said Fed vice-chair Don Kohn.
Albert Edwards, global strategist at Societe Generale, said the toppling banks are merely a symptom of a deeper rot. "The banks are not the problem. Nor even the grotesquely leveraged funds. The problem is that an economic bubble financed by ridiculously loose monetary policy is unravelling," he said.
"US house prices have a lot further to fall, which will simply crush the global economy. The lesson from Japan in the early 1990s is that the death dance goes on and on and on," he said.
The Fed blundered badly in the Slump, delaying rate cuts for too long. It allowed the money supply to implode.
It is acting with breath-taking speed this time. Rates have already been cut from 5.25pc to 3pc, and will be slashed again this week. New means of showering liquidity on the banking system are being devised each week.
As luck would have it, the world's greatest expert on the financial causes of depressions - Ben Bernanke - happens to be chairman of the Federal Reserve.
Banks to Seize Carlyle Capital Assets
NEW YORK -- The likely liquidation of Carlyle Capital Corp.'s remaining assets sent the fund's shares plummeting more than 90 percent Thursday and rattled stock markets around the globe. It was also a high-profile setback for private equity fund Carlyle Group.
Carlyle Capital said late Wednesday that it expected creditors to seize all of the fund's remaining assets _ investment-grade mortgage-backed securities _ after unsuccessful negotiations to prevent its liquidation.
Its shares, which went public at $19 a share in July and traded at $12 just last week, tumbled 93.6 percent to 18 cents on the Euronext exchange.
The Amsterdam-listed fund shook financial markets last week after missing margin calls from banks on its $21.7 billion portfolio of residential-mortgage-backed bonds. Carlyle's troubles have amplified fears that billions of dollars of depressed mortgage-backed securities will flood the market, reducing their value even further.
"Although it has been working diligently with its lenders, the company has not been able to reach a mutually beneficial agreement to stabilize its financing," Carlyle Capital said in a statement.
Carlyle's troubles heightened worries about the billions of dollars in depressed mortgage-backed securities, one factor that sent stock markets down. The Dow Jones industrial sank more than 200 points, following indexes in Asia and Europe lower.
The sell-off would mark a huge defeat for the Washington, D.C.-based Carlyle Group, one of the largest private equity firms in the world with $76 billion in assets. Carlyle Capital, registered in Britain but managed by New York-based executives, was the first of its 55 funds to go public.
Since the beginning of the credit crunch, Carlyle Group has extended loans to Carlyle Capital to help meet margin calls, including a $150 million revolving loan, Citigroup analyst Donald Fandetti told investors in a research note March 6. "It appears CCC is fully drawn on this line and so far no further loans have been provided."
Andrew Wilkinson, senior market analyst at Interactive Brokers Group LLC, said it didn't make sense for Carlyle Group to keep bailing out its mortgage-focused fund.
"If it's a standalone entity that's vulnerable to failure, then you let it go and you bear the consequences but you certainly don't throw good money after bad," Wilkinson said.
More than a year ago, the fund leveraged its $670 million equity 32 times to finance a $21.7 billion portfolio of AAA-rated residential mortgage-backed securities issued by Freddie Mac and Fannie Mae. It borrowed money from at least a dozen banks and firms, including Bank of America Corp., Citigroup Inc. and Merrill Lynch & Co.
Carlyle Capital posted the securities as collateral under repurchase agreements, so if the value of the securities fall, the lender has the right to ask for more collateral _ a margin call _ to secure the loan. If the borrower does not meet the margin call, the lender may sell the security.
The value of mortgage-backed securities has plummeted as U.S. home prices fall and foreclosures surge, prompting the banks to ask Carlyle Capital for more than $400 million in additional capital. The fund was unable to come up with the money, prompting lenders to start foreclosing on the securities.
As of Wednesday, Carlyle Capital said it has defaulted on about $16.6 billion of its debt, and the rest is expected to go into default soon. About $5.7 billion of the defaulted debt has been sold, the Carlyle Group said Thursday. Spokeswoman Emma Thorpe said she couldn't say what has been done with the rest.
Carlyle Group "participated actively" in the fund's negotiations with its lenders to refinance its portfolio and was prepared to provide substantial additional capital if sustainable terms could be achieved, the fund's statement said.
But hopes for refinancing fell apart after some lenders said the value of the collateral had declined further, which would result in additional margin calls Thursday of about $97.5 million.
One of the most ironic twists to the ongoing mission in Afghanistan emerged from the NATO meetings held in Brussels last week. With member countries either reluctant or unable to add military resources, NATO is now seeking assistance from Russia, its erstwhile Cold War enemy and one-time "evil occupier" of Afghanistan. In fact, the irony is so thick that we should first roll back decades' worth of propaganda and start at the very beginning.
NATO was formed in 1949 as a collective self-defence alliance to prevent any encroachment of the Soviet Union into Western Europe. The Soviets responded to this by creating their own defensive coalition of Communist countries (the Warsaw Pact) to protect them from any eastward expansion of NATO's influence. The nuclear arms race was at its zenith and even Europeans, still recovering from the massive destruction and carnage of the Second World War, understood the importance of maintaining large conventional armies. Troops and tanks were regarded as a preferable deterrent to an apocalyptic mushroom cloud.
The impasse that resulted in Europe did not prevent the U.S. and Soviets from waging war by proxy in non-aligned Third World countries around the world. Afghanistan, in fact, became a key battleground for the CIA and the KGB. Since it bordered the Soviet Union's central Asian republics of Uzbekistan, Tajikistan and Turkmenistan, the U.S. knew that Moscow could not afford to ignore events in impoverished and underdeveloped Afghanistan.
Throughout the '50s and '60s, Soviet engineers undertook several major infrastructure projects in Afghanistan, including the construction of the Salang tunnel through the Hindu Kush Mountains, which provided the first viable access between the country's northern and southern provinces. A full-scale program was introduced to train Afghan army officers and a large number of economic aid packages were extended to Kabul's Communist government.
The Americans decided things were going a little too smoothly for the Kremlin, so they decided to stir things up a little. By arming and funding Afghan Muslim extremists who were already resisting the social changes, the Americans sought to draw the Soviets into a full-scale military intervention.
By 1979 events had escalated to the point where the instability, lawlessness and flourishing drug trade along their shared border could no longer be ignored by the Kremlin. Following a coup staged by the KGB in Kabul, the newly appointed Afghan Communist president invited Soviet troops to deploy a security assistance force to help him stabilize Afghanistan.
It would have been high-fives all around for the CIA planners watching the Soviet tank columns rolling south through the Salang tunnel. The Russian bear had taken the bait and put his paw squarely on the American trap.
On the surface, the U.S. vehemently denounced the invasion of Afghanistan and in protest they pulled their athletes out of the 1980 Moscow Olympics. Behind the scenes, the U.S. ramped up military aid to the Afghan guerrillas and assisted in bringing in foreign mujahedeen fighters - such as a young Saudi Arabian zealot named Osama bin Laden - to bleed the Soviets white.
The stated objectives of the Soviet Union in Afghanistan were to provide a secure environment, equality for women, a centralized education and medical system, and the training of a self-sufficient Afghan army. While this may sound eerily similar to the current wish list for the NATO coalition in Afghanistan, a friend of mine at the American embassy was quick to point out one fundamental difference: "The (Soviets) were Communists," he emphatically stated, as if that in itself made any further explanation unnecessary.
The U.S. plan worked like a charm and by the time the last of the Russian troops retreated out of Afghanistan in 1989, they had left behind 50,000 dead comrades, the Moscow treasury was bankrupt and the Soviet Union was in a state of dissolution. The U.S.-equipped Afghan warlords finally triumphed over the Communist regime in Kabul and then turned on each other in an orgy of destruction and bloodletting. Whatever Soviet-built infrastructure was still intact in Kabul in 1996 was destroyed when the Taliban movement forced the mujahedeen warlords north of the Hindu Kush.
In the wake of 9-11, the planners in the White House must have suffered from short-term memory loss as they rushed to throw their troops into the very same trap they had built to destroy the Soviets. After using military force to topple the Taliban, the Americans appointed Hamid Karzai as president. His first act as leader was to invite the U.S.-led coalition to deploy a security assistance force to prop up his regime. Unlike the Soviets, the Americans didn't need to deploy in support of this request - they were already on the ground.
Now into the seventh year of their occupation and with the American economy on the point of collapse, NATO is looking to Russia for help in transporting troops and equipment into Afghanistan. With the skyrocketing oil prices boosting the Russian ruble to dizzy new heights and no one asking for their troops to fight and die in Afghanistan, it would seem that the wheel of fate has turned a full circle.
If you want to drive this point home, go out and rent an old copy of Rambo III. That's the sequel wherein Sylvester Stallone fights alongside the guerrillas, and the final credits dedicate the movie to "the brave mujahedeen in Afghanistan."
Federal authorities are investigating why a dummy bomb traveling about 600 mph crashed into a building at a Tulsa apartment complex Thursday.
The non-explosive BDU-33 bomb came from an F-16 fighter plane that was headed for Salina, Kan., from the Tulsa Air National Guard Base, according to a press release from the Oklahoma Air National Guard. The plane took off about 3 p.m. and the bomb was inadvertently released from the aircraft a few minutes later.
No one was injured when the bomb crashed into the Canyon Creek Apartments, 2102 E. 51st St. It hit a building that houses electrical equipment and knocked out an apartment wall and power to the complex.
The BDU-33, which weighs 22 pounds and is used during training, has a spotting charge that releases a cloud of smoke on impact, but the pilot never saw the smoke trail that would have indicated it did indeed drop.
The Federal Bureau of Investigation and Bureau of Alcohol, Tobacco, Firearms and Explosives have been assisting in the ongoing investigation.
Canyon Creek resident Jeremy Isbell said the electricity was off when he and his wife arrived at their home on Thursday evening. After they went inside, his wife, Kyla Isbell, discovered that their bathroom wall had been knocked out.
Isbell said he went outside to tell AEP-PSO employees who were trying to find the cause of the outage that the damage to his home might have been caused by an electrical explosion.
The workers then looked at the damage and found the bomb -- half of which was buried in the concrete structure of the building that housed the complex's electrical equipment. The other part, which had fins on it, was twisted and broken off but probably measured at least 2 feet in length, he said.
The bomb had plunged through some trees before it hit the building, and firefighters were using ladders to climb into the trees, apparently to try to determine its trajectory, Isbell said.
Yes, group think is the best way to run the empire,All Hail Caesar! If you don't think the way we do you don't think at all!!!How dare Naomi Wolfe or anyone for that matter have an opinion that runs counter to the great and powerful OZ !!!
Shepard Smith was waiting on that pitch and hit it out of the park! What she should have said - " Yes, Kerry and Gore were the least attractive democratic candidates in the history of modern politics, but democratic voters still preferred to vote with noses held, as opposed to the Republican choice" Smith should not have defended the FOX position so vehemently , because it exposed the pro Republican bias that his previous comment had rightly avoided.
How dare those Democrats not approve a bill that gives the government pretty much carte blanch to listen in on phone conversations any time they want! I mean, ATT and Verizon both worked very hard to violate our freedoms of privacy and these darn Democrats are reluctant to let them continue in their Bush administration-encouraged efforts. Its a breach of national security! The evil terrorist threats could be plotting against us at this very moment and we would have no idea because of some silly little things like THE BILL OF RIGHTS getting in our way.
This photo, of the Soviet Union's Dolon Air Field in August 1966, shows more detail, including the location of heavy bombers--a very important piece of information at the height of the Cold War.
When President Eisenhower approved the program in 1958, and throughout its 12-year run, information on military and aerospace efforts in the Soviet Bloc was very hard to come by, and the satellite's eye in the sky helped the U.S. to peek behind the (iron) curtain. Corona, actually the name of a series of satellites used in the program, was a joint effort of the Defense Department and the Central Intelligence Agency.
According to the NRO Web site, the resolution of Corona's images was 6 feet at its sharpest, 560 feet at its worst. Individual satellite images covered an area of about 10 miles by 120 miles.
Credit: National Reconnaissance Office
Detail is lacking in this look at a Chinese nuclear test site, four days after an explosion there, but the bleakness of the undated black-and-white image only serves to underscore the "Ground Zero" label.
Credit: National Reconnaissance Office
Here's an instantly recognizable landmark: the Pentagon, on a September day in 1967. Remember: This was long before the advent of Google Earth. The NRO calls Corona the "first operational space photo reconnaissance satellite."