Monday, December 31, 2007

2007 Deadliest for US troops

This is from Google.
The final months of the year have involved much less violence but much of this is due to enlisting Sunnis to fight Al Qaeda and Sadr's peaceful tactics for the time being. There is still not much progress on the political front towards meeting benchamarks set by the US including the oil bill.

2007 Deadliest for US Troops in Iraq
By BRADLEY BROOKS – 20 hours ago

BAGHDAD (AP) — The second half of 2007 saw violence drop dramatically in Iraq, but the progress came at a high price: The year was the deadliest for the U.S. military since the 2003 invasion, with 899 troops killed.

American commanders and diplomats, however, say the battlefield gains against insurgents such as al-Qaida in Iraq offer only a partial picture of where the country stands as the war moves toward its five-year mark in March.

Two critical shifts that boosted U.S.-led forces in 2007 — a self-imposed cease-fire by a main Shiite militia and a grassroots Sunni revolt against extremists — could still unravel unless serious unity efforts are made by the Iraqi government.

Iran also remains a major wild card. U.S. officials believe the neighboring country has helped quiet Iraq by reducing its flow of suspected aid to Shiite fighters, including materials needed for deadly roadside bombs.

But Iran's apparent hands-off policies could come under strain as Shiite factions — some favoring Iran, others not — battle for control of Iraq's oil-rich south.

The Pentagon, meanwhile, will increasingly look to the uneven Iraqi security forces to carry the load in 2008 as demands for an American exit strategy grow sharper during the U.S. election year.

Britain, the main U.S. coalition partner in Iraq, is gradually drawing down its forces and other allies, including Poland and Australia, are contemplating full-scale withdrawals in the coming year.

"We're focusing our energy on building on what coalition and Iraqi troopers have accomplished in 2007," Gen. David Petraeus told a group of Western journalists on Saturday. "Success will not, however, be akin to flipping on a light switch. It will emerge slowly and fitfully, with reverses as well as advances, accumulating fewer bad days and gradually more good days."

That arc of progress played out in the raw statistics of U.S. and Iraqi casualties.

American military deaths peaked in May with 126 troops killed. It was then that the U.S. began ramping up its attacks against insurgent strongholds, leading to increased clashes in Baghdad and other key areas across central Iraq.

Seven months on, commanders and analysts say America's aggressive strategy of targeting al-Qaida in Iraq strongholds is paying off: U.S. casualties have dropped sharply. As of Sunday night in Baghdad, 21 deaths were reported in December, one more than in February 2004, which was the lowest monthly total of the war.

The 899 deaths in 2007 surpassed the previously highest death toll in 2004, when 850 U.S. soldiers were killed. The total for 2007 could rise slightly; occasionally the military reports new casualties a few days after they occur. The military reported the non-combat related death of a soldier on Sunday.

At least 3,902 members of the U.S. military have died since the beginning of the war. Of those, at least 3,175 died as a result of hostile action, according to the military's numbers.

Iraqi civilian deaths have tracked that decline and overall violence across the country is down roughly 60 percent, American commanders say.

Since the influx of some 30,000 U.S. troops that began in June, the lessening violence has meant that new problems have emerged.

"There certainly are ample challenges out there in the new year. In some respects, the positive developments in the latter half of 2007 also represent the challenges of 2008," U.S. Ambassador Ryan Crocker said during a recent briefing.

An example, Crocker said, is how the improving security situation is in part luring back Iraqis who took refugee in neighboring Syria, Jordan and elsewhere.

"The return of refugees — a good thing obviously, but a process is going to have to be carefully managed so that it doesn't sow the seeds of new tension and instability," he said.

Along with the increase in American troops, Iraq's lessening violence has been attributed to a self-imposed freeze on activities by the Mahdi Army — the militia of radical Shiite cleric Muqtada al-Sadr.

Another important change was the quick growth of mostly Sunni anti-al-Qaida in Iraq groups, or "awakening councils," who once fought against U.S. and Iraqi forces but now point their guns toward the insurgents.

Of the more than 70,000 fighters in the awakening councils, only 20 percent are expected to be absorbed into the Iraqi security forces. The rest are to receive job training through a joint $300 million program Iraqi and American officials are creating.

That program is in its beginning stages and there are few details about how it will be carried out, but analysts say it must succeed or the Sunni fighters who do not join Iraq's military may sell their services to the insurgents.

On Saturday, a new audiotape by Osama bin Laden warned Iraqi Sunnis against fighting al-Qaida, saying "the most evil of the traitors are those who trade away their religion for the sake of their mortal life."

Keeping the militia of al-Sadr and other powerful Shiite leaders on the sidelines also means keeping Iran to its promise to halt the flow of weapons and training to them, officials say.

"How lasting a phenomenon that will be and how Iran will define and play its role in Iraq in 2008 I think is going to be very important to the long-term future of the country," Crocker said.

Iraqi civilian deaths also peaked in May with 2,155 killed. That fell to 718 in November and 710 in December. For the year, 18,610 Iraqis were killed. In 2006, the only other full year an AP count has been tallied, 13,813 civilians were killed.

Civilian deaths are compiled by the AP from hospital, police and military officials, as well as accounts from reporters and photographers. Insurgent deaths were not included. Other counts differ and some have given higher civilian death tolls.

Those numbers paint an increasingly optimistic picture, but James Carafano, a security expert with the Heritage Foundation think-tank in Washington, D.C., warned dangers lurk.

"The number of people who have the power to turns things around appears to be dwindling," he said regarding extremists. "But there are still people in Iraq that could string together a week of really bad days."

While that might not mean a return to the bloodiest moments of the Iraq war, Carafano said it could seriously rattle the Iraqi government as it tries to bring about some form of political reconciliation in 2008, a key to long-term security.

"People have to be really careful about over-promising that this is an irreversible trend — I think it is a soft trend," he said of the declining violence.

Carafano pointed to the problem of integrating the Sunni awakening councils into Iraqi society and keeping the Shiite militias out of the fight. If either of those situations changes, he said, increased bloodshed in the country is likely.

Those warnings in mind, Carafano said he thought the "surge" in U.S. troops had to a large extent met one of its important goals: to allow the Iraqi government to focus on questions of governance instead of dealing only with security.

He likened the increase in troops to the Marshall Plan that largely rebuilt Europe after World War II and demonstrated U.S. commitment to that continent.

"I think the surge made that statement to Iraqis," Carafano said. "Here's America, fighting an unpopular war and things aren't going so well and we turn around and send more troops in. To the good guys and the bad guys is was a reaffirmation that Americans aren't going to walk away from this."

Top economist says America could plunge into recession

Even if the economy just declines slightly early in the New Year this could exacerbate the credit crunch. As noted in my earlier post there could be a credit crunch in auto loans. If people's incomes do not keep pace with debt then there is bound to be increased defaulting on loans.

From The Times
December 31, 2007
Top economist says America could plunge into recession
Suzy Jagger in New York

Losses arising from America’s housing recession could triple over the

next few years and they represent the greatest threat to growth in the
United States, one of the world’s leading economists has told The

Robert Shiller, Professor of Economics at Yale University, predicted
that there was a very real possibility that the US would be plunged
a Japan-style slump, with house prices declining for years.

Professor Shiller, co-founder of the respected S&P Case/Shiller
house-price index, said: “American real estate values have already
around $1 trillion [£503 billion]. That could easily increase
over the next few years. This is a much bigger issue than sub-prime. We

are talking trillions of dollars’ worth of losses.”

He said that US futures markets had priced in further declines in house

prices in the short term, with contracts on the S&P Shiller index
pointing to decreases of up to 14 per cent.

“Over the next five years, the futures contracts are pointing to
of around 35 per cent in some areas, such as Florida, California and
Vegas. There is a good chance that this housing recession will go on
years,” he said.

Professor Shiller, author of Irrational Exuberance, a phrase later used

by Alan Greenspan, the former Federal Reserve chairman, said: “This
is a
classic bubble scenario. A few years ago house prices got very high,
pushed up because of investor expectations. Americans have fuelled the
myth that prices would never fall, that values could only go up. People

believed the story. Now there is a very real chance of a big

He pointed out that signs at the beginning of 2007 that had indicated
that some states were beginning to experience a recovery in house
had proved to be false: “States such as Massachusetts had seen some
increases at the beginning of the year. Denver also looked like it had
different path. Now all states are falling.”

Until two years ago, each of America’s 50 states had experienced a
prolonged housing boom, with properties in some – such as Florida,
California, Arizona and Nevada – doubling in price, fuelled by cheap
credit and lax lending practices to borrowers who ordinarily would not
have been able to secure a mortgage. Two years ago, the northeastern
states of America became the first to slide into a recession after 17
successive interest-rate rises between June 2004 and August 2006 hit
property market.

Last week, new numbers from the S&P/Case Shiller index showed that
prices had declined in October at their fastest rate for more than six
years, with homes in Miami losing 12 per cent of their value.


Juan Cole: Top Ten Challenges for US in the Middle East

This is from Juan Cole's blog. As usual Cole's remarks are quite perceptive although I sometimes find him rather naive. He is a bit bemused by the fact that if the US were really interested in combatting terrorism they would bave acted differently. He doesn't conclude, as I would, that combatting terrorism was not the first order of business for the US but projecting US power and securing energy supplies. Iraq was no fool's errand! While terrorism is a genuine threat that threat is also used as a fig leaf to cover the US drive for global hegemony.
Cole seems very confident that US interventionism if properly done will help stabilise the situation in the Middle East. I have no idea why he should think that!
The record so far has not been very good. Even well intentioned intervention can often exacerbate the situation. For example any support for those trying to democractise from inside Iran is most likely to be counterproductive and gives an excuse for authorities to brand them as enemies of Iran.

Top 10 Challenges Facing the US in the Middle East, 2008
10. Helping broker a deal in Lebanon between the March 14 Movement and the Shiites so that a new president can be elected and a national unity government can be formed.

Lebanon's economy was badly damaged by the Israeli war on the poor little country in summer of 2006. Tourism is a big part of that economy, and is being hurt by the continued political instability. Given historically high oil prices, Iran will probably make $56 billion from petroleum sales this year. That gives it lots of carrots to hand out in Lebanon. If the Lebanese were better off, foreign oil money would not be as important to them. Likewise, the country's poverty breeds social ills. Hizbullah militiamen might be harder to find if there was well-paying work for young men in the south. The dire poverty of Palestinians in camps such as Nahr al-Bared near Tripoli has made them open to predations by Mafia-like groups linked to al-Qaeda. Just a couple of weeks ago, Lebanese security broke up a plot to blow up churches in Zahle on the part of a small group of jihadis. An economically flourishing Lebanon would be less likely to be beset by these ills. The Levant is not that far away from the US or its major interests, and it is very unwise to allow the pathological situation in Lebanon to fester. A prosperous, healthy Lebanon is good for US security and is less likely to become the cat's paw of regional powers hostile to US interests.

9. The US should exercise its good offices to encourage continued dialogue between Iran and Saudi Arabia. The capture of Baghdad by the Shiites and the ethnic cleansing of most Sunnis from it have set the stage for a big Sunni-Shiite battle for the capital as soon as the US troops get out of the way. It is absolutely essential to Gulf security, and to American energy security, that Saudi Arabia and Iran not be drawn into a proxy Sunni-Shiite war in Iraq. Keeping in close contact with each other and with Iraqis of the other sect is the best way for them to avoid a replay of the Iran-Iraq War of the 1980s. Those in the Bush administration who dream of an Israeli-Saudi alliance against Iran are playing with fire, a fire that is likely to boomerang on the US. If the Persian Gulf goes up any further in flames, the resulting unprecedentedly high petroleum prices will likely finally produce a bad impact on the US economy. Instead, the US should be attempting to bring Iran in from the cold, now that the NIE has absolved it of nuclear-weapons ambitions.

8. Congress should expand funding for, and guarantee the future of, the Combatting Terrorism Center at West Point. Its researchers do among the very best jobs of analyzing the writings and activities of the Salafi Jihadis, and so of combatting them. Few government institutions are as effective. If the US government were serious about the threat of terrorism, I would not even have to make this plea. Of course, if Bush and Cheney had really cared about the threat of al-Qaeda, they would have gone after it and gotten Bin Laden and al-Zawahiri rather than rushing off on a fool's errand in Iraq.

7. The US must repair its tattered relations with Turkey. Turkey has been a NATO ally for decades and Turkish troops fought alongside American ones in the Korean War. Turkey stood with the US in the Cold War and gave the US bases on its soil. As a secular country, it is an ally in the struggle against the Salafi Jihadis, for which even religious Turks have contempt. Turkey has among the more promising economies in the Middle East, among non-oil states, and is attracting billions in foreign investment. The US has for some strange reason stiffed Turkey several times in the past decade. The Clinton administration promised Turkey a billion dollars in restitution for the monies it lost during the Gulf War, and then Congress refused to appropriate the money. More recently, the US has unleashed a virulent and violent Kurdish nationalism by allying with Massoud Barzani in Iraq. Barzani in turn has given safe harbor to guerrillas of the Kurdish Workers Party (PKK), who have been going over the border and killing Turks, then retreating to Iraq. The Bush administration has tried to resolve this probably by helping the Turks bombard PKK positions inside Iraq, but that is not ideal. Instead, the US should put economic and other pressure on Barzani to expel the PKK from Iraq.

6. The US must keep the pressure on Pervez Musharraf to hold free and fair, early elections in Pakistan. The elections probably cannot be held on Jan. 8, as planned, because of the extensive turmoil and destruction of polling stations and ballots during the past few days. But they should not be postponed past March 1. Musharraf's own legitimacy has collapsed, and he is in danger of becoming a Shah of Iran figure, hated by his own people and driven from office. Such a scenario could be very bad for the United States. That is why Joe Biden is right and John McCain is wrong when the latter warns against dumping Musharraf. Why cannot the American Right learn that backing the wrong horse is often worse than not having a horse in the first place?

5. The US and NATO have to stop doing search and destroy missions in Afghanistan. The Pushtun tribespeople are never going to put up with tens of thousands of foreign troops in their country, and, indeed, in their underwear drawers. Search and destroy missions just multiply feuds with local people. The NATO and US military missions in Afghanistan have to be redefined so that they are not simply putting down tribes for the central government. The best Afghan central governments have ruled by playing the tribes off against one another, not by trying to crush them. The solutions in Afghanistan are political and economic. More reconstruction needs to be done. Farmers need aid to be weaned off poppies. Forced eradication of poppy crops appears to be behind a lot of the "Taliban resurgence," which actually often looks to me from a distance like angry farmers taking revenge for the destruction of their livelihoods.

4. The US must facilitate provincial elections in Iraq. They are arguably more important than any other step. They would solve a number of important problems.

The Sunni Arab provinces of Al-Anbar, Salahuddin, Ninevah and Diyala have unrepresentative governments (Diyalah, 60% Sunni, is ruled by the Islamic Supreme Council of Iraq, a hard line Shiite group!) The Sunni Arab parties declined to run in January, 2005, and there have been no subsequent provincial elections. Representative Sunni provincial governments could negotiate from a greater position of strength with the federal government of Shiite Dawa Party leader and prime minister Nuri al-Maliki. Some of the Awakening Councils members, who are self-appointed, might get elected and so gain greater legitimacy.

Without legitimate provincial governments in the Sunni Arab provinces, it is hard to see how the US can hope to withdraw troops and turn over security to locals, as Gen. Petraeus had planned to do in Mosul this year.

In the south, Basra needs new elections because its provincial government saw a major division this year, leading to an ISCI-led vote of no confidence in the governor, who is from the Islamic Virtue Party. But then the governor refused to step down! Ineffective governance in oil-rich Basra, which contains the country's only major ports, is bad for the whole country. In some other southern provinces, such as Diwaniya, a more representative provincial government might make for more social peace.

What I am saying now is not new, and Ambassador Ryan Crocker and Gen. Petraeus have repeatedly called for such elections. I am saying, now is the time to make a big push for them. If the US starts drawing down troops this year, it will make it harder to hold elections, since the Iraqi security forces probably cannot keep the voters dafe. If the US leaves behind the current provincial governments, as with Diyala, Diwaniya and Basra in particular, it is probably leaving behind provincial civil wars.

3. The US Congress must allocate substantial funds, on the order of $1 billion or more, for Iraqi refugee relief in Syria and Jordan. UNO relief funds are running out. Iraqis' own savings are running out. Children are not in school and are going hungry. People are being exploited, including young girls forced into prostitution. A majority of the 1.5 million Iraqis in Syria went there in 2007, and almost all of them have been forced out of Baghdad and other areas because of the political instability that the United States unleashed in their country. The surge is being touted as a victory in the US press, but it seems to have displaced 700,000 Iraqi civilians! The US is spending $15 billion a month on the Iraqi and Afghanistan Wars. It can afford $1 billion a year for refugee relief. This is our responsibility. How future generations of Iraqis view the United States will in part depend on whether we do this. I ask all Americans to write your congressional representatives and press them on this humanitarian issue.

2. The Bush administration should expend all of its remaining political capital in the region to have the Israelis return the Golan Heights to Syria. The Golan was captured in 1967. By the United Nations Charter, countries may not permanently grab the territory of their neighbors. The Syrians will have to agree to keep the Golan a demilitarized zone, with UNO blue helmets patrolling as a safeguard. In return, Syria would have to agree to cease backing Palestinian militants and would have to play a positive role in creating a Palestinian state. Damascus would also have to work to restore social peace in Lebanon. Such a deal might help to detach Syria from its alliance with Iran. That in turn would weaken Hizbullah. This deal would be good for Israeli security, and if it helped speed up the creation of a Palestinian state, might even keep Israel from falling into the Apartheid situation that Prime Minister Ehud Olmert recently said he fears.

1. The US must insist that the Israeli siege of Gaza must be lifted. A third of Palestinians killed by Israel this year were innocent civilians. The agricultural sector is being destroyed because farmers cannot export their goods owing to the Israeli blockade. Food, water, essential medicines are all being denied to civilian populations, including children. If Prime Minister Ehud Olmert is so worried about Israel being seen as an Apartheid state, he should release Gazans from their penitentiary and stop deploying collective punishment against civilians.

posted by Juan Cole @ 12/31/2007 06:26:00 AM 0

A car loan credit crunch?

So people will lose not only their houses but their cars. Again these loans were sold as securities and no doubt the risk is spread all over the globe. If there is a recession in the US more and more debtors will be unable to make payments and this will cause even more problems within the economy. It could be a very bumpy ride in 2008. But Happy New Year everyone anyway!

[Fasten your seatbelts, it's going to be a bumpy night!],0,4315064.story?coll=la-home-center

Los Angeles Times

New cars that are fully loaded — with debt
Americans are rolling over loans, often ending up owing more for the
vehicle than it's worth.

By Ken Bensinger / Los Angeles Times Staff Writer

December 30, 2007

When Jennifer and Bobby Post traded in their 2001 Chevy Suburban last
year for a shiny new Ford F-350 turbo diesel with an extended cab, it
seemed like a great deal. Even though they still owed $9,500 on their
SUV after the trade-in value, they didn't have to put a penny down.

The dealership, near the Posts' home in Victorville, made it easy; it
just added the old debt to the price of the new truck and gave the
couple a seven-year, $44,276 loan.

The Posts were a little worried about taking on such a long
obligation, but they couldn't pass up a monthly payment under $700.
Now they're having regrets.

"I didn't realize how much debt was in it," said Jennifer Post, who
has since moved with her family to Iowa. Now, she'd like to get rid of
the truck but can't, because there's so much debt that she'd literally
have to pay someone to take it off her hands.

"We have no options," she said.

Americans haven't just been taking out risky mortgages for homes in
the last few years; they've also been signing larger automobile loans
for significantly longer terms than they used to.

As a result, people are slipping into a perpetual cycle of automobile
debt that experts think could lead to a new credit crunch extending
from dealerships to driveways and all the way to Wall Street.

Gone are the days of the three-year car loan. The length of the
average automobile loan hit five years, four months in October, up
more than six months from 2002, according to the Federal Reserve. And
nearly 45% of loans written today are for longer than six years. Even
some staid lenders owned by the carmakers, such as Toyota Financial
Services and Ford Credit, are offering seven-year financing. And a few
credit unions, particularly in the West, are tinkering with the
eight-year note.

At the same time, the amount of money drivers owe on their cars is
soaring. In October, the average amount financed hit $30,738, up
$3,500 in just a year and nearly 40% in the last decade, according to
the Fed. More troubling, today's average car owner owes $4,221 more
than the vehicle is worth at the time it's sold -- up from $3,529 in
2002, according to industry analyst Edmunds.

[that's much too much! -- JD]

... It's not just individual consumers who are at financial risk.
Nationwide, an estimated $575 billion in new and used auto loans are
written every year by auto manufacturers, banks, credit unions and
other lenders. About 30% of the loans that are originated by banks,
and 100% of those issued by automaker financiers, are, like mortgages,
repackaged and sold as securities, according to the Consumer Bankers

Analysts warn that just as investors didn't comprehend the risk
inherent in some of the more exotic home mortgages in recent years,
they aren't considering how risky these car loans are. If longer loan
terms allow debt on the loans to grow too large, many drivers may
simply default, leading to expensive repossessions.

And even those who keep paying their bills may reach a point, like
Gerhardt, where they simply can't afford another car. That could send
vehicle sales down the drain, a nightmare scenario for an industry
that has already taken a hit this year from slower consumer spending
and higher gas prices.

It could also lead to serious losses among financial institutions that
have invested in car debt. Among securitized auto loans, two-thirds
have terms longer than 60 months, a fact that Standard & Poor's, which
rates auto debt for sale on the secondary market, calls a "credit

This month, S&P reviewed its ratings on $113.5 billion in auto loan
securities it rated in the last two years out of concerns over growing
losses. It didn't make any downgrades but predicted that "rising
losses will continue into 2008 across all segments of the auto loan

S&P has found that delinquencies of more than 60 days on car loans
issued this year to borrowers with the best credit are up 20% compared
to those issued last year, while delinquencies on loans issued this
year to subprime borrowers increased by 16%. Delinquency rates on car
loans are still far lower than on mortgages, but there is growing
concern in the financial services industry. Indeed, Tom Webb, chief
economist of used-auto analyst Manheim Consulting, said he expects the
tally for 2007 repossessions to be up by 10%.

Mark Pregmon, executive vice president for consumer lending at
SunTrust Bank, is among the concerned. "Any time you extend the
maturity of the loan, you take on more risk. The question is whether
there's enough assessment of that extra risk," he said. "Obviously,
it's a problem. It's a house of cards."

In the 1970s and '80s, car loans hovered between 36 and 48 months, and
drivers typically kept their cars longer than the life of the loan. A
number of factors changed that.

One key was interest rates, which fell from a high of 17.8% in the
early 1980s to lower than 5% today, according to the Federal Reserve.
Another was affordability. According to an index tracked by Comerica
Bank, cars have steadily gotten more affordable -- as compared to
median family income -- since the late 1990s.

With cheap money at hand for more-affordable cars, the temptation to
keep buying became huge. Today, according to Pregmon, financed cars
are typically turned over in 24 to 36 months.

At the same time they were extending loan maturities, lenders,
competing with one another, began offering more money and requiring
smaller down payments.

Today, most lenders offer financing on 100% or even 125% of the
sticker price, and some offer the most credit-worthy buyers loans for
twice the value of the vehicle they're purchasing. Last year, the
average amount financed for new cars reached 99%, according to the
Consumer Bankers Assn., up from 95% in 2005.

Lenders are beginning to brace themselves; many have said they intend
to tighten standards and require larger down payments.

Despite warnings from S&P, the Consumer Bankers Assn., Lehman Bros.
and others, there is little sign that the automobile industry is
willing -- or, with consumers demanding low payments, even able -- to
reduce the lengths of the loans they issue.

"For banks, it's a matter of meeting consumer demand: no money down
and extend the term," said SunTrust's Pregmon. "But as a lender,
you've got a moral obligation as well. Are we putting the clients in
loans they can't afford?"

Pakistan to delay elections

The government is no doubt surprised by the fact that Bhutto's party is going to contest the elections. This forced Sharif's party to reverse its decision to boycott the elections. Musharraf no doubt will delay the elections for some time to try and cool the anger against him and also to make arrangements to rig the results if he can make appropriate deals or even if he can't!
The move to make the son the symbolic head of the party was clever in that Bhutto's husband's reputation for corruption is legendary. The son cannot run for office until 25!
I am a bit mystified by all the fuss over exactly how Bhutto died. What possible value the government could gain from saying she died from hitting her head as against a bullet wound is not clear to me. Certainly the government has not denied that she was shot at and that there was a suicide blast. What on earth difference does it make if these events in themselves were not the immediate cause of her death. If they had not happened she would not have banged her head cracking open her skull.

Pakistan to delay elections

Monday, December 31, 2007
ISLAMABAD: Elections in Pakistan appear likely to be delayed by several weeks, despite demands by the party of the slain opposition leader Benazir Bhutto and other politicians that they take place as scheduled on Jan. 8, officials said Monday.

The Election Commission said that it had recommended an unspecified delay in the parliamentary polls following the unrest that was triggered by the assassination of Bhutto last week. It said its final decision would be made Tuesday.

Separately, a senior government official predicted that the elections would be postponed by "six weeks or so, as the environment to hold free and fair elections is not conducive." The official spoke on condition of anonymity because he was not authorized to disclose the information.

Despite being in mourning, Bhutto's political party and that of Pakistan's other major opposition leader, Nawaz Sharif, want the polls held on time, perhaps sensing that major electoral gains are possible amid sympathy over Bhutto's death and a widespread belief that political allies of President Pervez Musharraf were behind the killing. Sharif's party reversed an earlier decision to boycott the election.

On Sunday, Bhutto's Pakistan People's Party named her 19-year-old son, Bilawal Bhutto Zardari, as its symbolic leader and left day-to-day control to her husband, Asif Ali Zardari. The announcement was made at a chaotic news conference at the family's ancestral home in Naudero, in southern Pakistan.

The decision to place the burden of blood and history on Bhutto's first-born son, an Oxford undergraduate with no political experience, reflects not only an abiding dynastic streak in South Asian politics - three generations of the Nehru-Gandhi family have dominated politics in India, and hereditary politics pervade Sri Lanka and Bangladesh, as well - but also how much the Pakistan People's Party relies on the Bhutto family name and legacy to bind its supporters.

In keeping with his new mantle, the new chairman added his mother's maiden name to his, becoming the newly anointed Bhutto scion. "My mother always said democracy is the best revenge," he said in a brief address.

The elder Zardari said he would manage the chairmanship on his son's behalf until he finishes his university degree - a minimum of three years. The father instructed reporters not to ask his son any further questions, saying he was "of a tender age."

Later, in the backyard of the family's house, Bhutto Zardari said in an interview that he had been tutored by his mother to play a role in Pakistani politics. "There was always a sense of fear I wouldn't be able to live up to her expectations," he said. "I hope I will."

Asked about his most immediate challenge, he said, "First, to finish my degree."

That would appear to rule out any possibility that Bhutto Zardari could become the new leader of Pakistan before he is significantly older. Nonetheless, the elder Zardari said in an interview, "As her son, he will become a uniting force."

Senior party officials said Bhutto Zardari would be a far less controversial titular head than his father, who had been accused of a raft of corruption charges, jailed for a total of 11 years and blamed in some quarters for some of Bhutto's political woes.

It could not be a more difficult time for the party. Bhutto had held together a large and diverse organization, and even if, on the back of public grief, it were to win the coming elections, it would be likely to be under great pressure to bring a semblance of stability to a nation racked by a wave of extremist violence.

At the news conference, the elder Zardari said he would not run in the election and therefore would not be the party's prime ministerial candidate. That job, he said, would probably go to the party vice president, the veteran party leader Makhdoom Amin Fahim, but that was a decision, he added, that would have to be made by party leaders.

Bhutto was killed in a suicide bomb and gun attack Thursday, but disagreements between her supporters and the government over the precise cause of death are undermining confidence in Musharraf and adding to calls for an international investigation.

New video footage, obtained by Britain's Channel 4, shows a man firing a handgun at Bhutto from close range as she stands in an open-topped vehicle. Her hair and shawl then move upward, suggesting she may have been shot. She then falls into the vehicle just before an explosion rocks the car.

The government has insisted that Bhutto was not hit by any of the bullets, and that she died after the force of the blast slammed her head against the sunroof. Bhutto's family and supporters say she died from gunshot wounds to her head and neck.

Zardari confirmed Sunday that he had refused a request to perform an autopsy, saying he did not trust the government of Musharraf to carry out a credible investigation. This means that short of exhuming her body - something her supporters have already ruled out - the cause of her death will be difficult to establish.

Zardari urged the United Nations to establish a committee like the one investigating the 2005 assassination of the former prime minister of Lebanon, Rafik Hariri. Several leading U.S. politicians have made similar calls.

Musharraf agreed to consider international support for the investigation when he spoke by phone Sunday with Gordon Brown, the British prime minister's office said. But Rashid Qureshi, a spokesman for the Pakistani president, said Monday that Musharraf had made no such promises.

Copyright © 2007 The International Herald Tribune |

Krugman: Trouble with Trade

For a long time there was a tendency to pooh pooh the negative results of trade. Krugman at least recognises a few of the negative results but only between high and low wage countries. It is not surprising that unions and workers in general are facing hard times as far as retaining benefits and wages at the level they had before globalisation. There are other negative effects that Krugman does not even touch upon. Trade agreements usually limit sovereignty in numerous ways in the interests of capital. For example agreements usually insist on recognition of international property rights that protect patent holders against no-name competitors for as long as twenty years. This can add huge costs to health care plans but huge profits to pharmaceutical companies. Often regulations will be harmonised downward and local or national preference in contracting outlawed. In the case of NAFTA in relation to Canada the so-called trade agreement is mainly a resource grab for the US. Canada is forced to share basic resources with the US and at prices not above those in Canada. In many ways too US labor has lost out as production shifted to lower wage Mexico. But Mexican subsistence corn farmers were also ruined.

The New York Times / December 28, 2007

Op-Ed Columnist / Trouble With Trade


While the United States has long imported oil and other raw materials
from the third world, we used to import manufactured goods mainly from
other rich countries like Canada, European nations and Japan.

But recently we crossed an important watershed: we now import more
manufactured goods from the third world than from other advanced
economies. That is, a majority of our industrial trade is now with
countries that are much poorer than we are and that pay their workers
much lower wages.

For the world economy as a whole — and especially for poorer nations

growing trade between high-wage and low-wage countries is a very good
thing. Above all, it offers backward economies their best hope of
moving up the income ladder.

But for American workers the story is much less positive. In fact,
it's hard to avoid the conclusion that growing U.S. trade with third
world countries reduces the real wages of many and perhaps most
workers in this country. And that reality makes the politics of trade
very difficult.

Let's talk for a moment about the economics.

Trade between high-wage countries tends to be a modest win for all, or
almost all, concerned. When a free-trade pact made it possible to
integrate the U.S. and Canadian auto industries in the 1960s, each
country's industry concentrated on producing a narrower range of
products at larger scale. The result was an all-round, broadly shared
rise in productivity and wages.

By contrast, trade between countries at very different levels of
economic development tends to create large classes of losers as well
as winners.

Although the outsourcing of some high-tech jobs to India has made
headlines, on balance, highly educated workers in the United States
benefit from higher wages and expanded job opportunities because of
trade. For example, ThinkPad notebook computers are now made by a
Chinese company, Lenovo, but a lot of Lenovo's research and
development is conducted in North Carolina.

But workers with less formal education either see their jobs shipped
overseas or find their wages driven down by the ripple effect as other
workers with similar qualifications crowd into their industries and
look for employment to replace the jobs they lost to foreign
competition. And lower prices at Wal-Mart aren't sufficient

All this is textbook international economics: contrary to what people
sometimes assert, economic theory says that free trade normally makes
a country richer, but it doesn't say that it's normally good for
everyone. Still, when the effects of third-world exports on U.S. wages
first became an issue in the 1990s, a number of economists — myself
included — looked at the data and concluded that any negative effects
on U.S. wages were modest.

The trouble now is that these effects may no longer be as modest as
they were, because imports of manufactured goods from the third world
have grown dramatically — from just 2.5 percent of G.D.P. in 1990 to
percent in 2006.

And the biggest growth in imports has come from countries with very
low wages. The original "newly industrializing economies" exporting
manufactured goods — South Korea, Taiwan, Hong Kong and Singapore —
paid wages that were about 25 percent of U.S. levels in 1990. Since
then, however, the sources of our imports have shifted to Mexico,
where wages are only 11 percent of the U.S. level, and China, where
they're only about 3 percent or 4 percent.

There are some qualifying aspects to this story. For example, many of
those made-in-China goods contain components made in Japan and other
high-wage economies. Still, there's little doubt that the pressure of
globalization on American wages has increased.

So am I arguing for protectionism? No. Those who think that
globalization is always and everywhere a bad thing are wrong. On the
contrary, keeping world markets relatively open is crucial to the
hopes of billions of people.

But I am arguing for an end to the finger-wagging, the accusation
either of not understanding economics or of kowtowing to special
interests that tends to be the editorial response to politicians who
express skepticism about the benefits of free-trade agreements.

It's often claimed that limits on trade benefit only a small number of
Americans, while hurting the vast majority. That's still true of
things like the import quota on sugar. But when it comes to
manufactured goods, it's at least arguable that the reverse is true.
The highly educated workers who clearly benefit from growing trade
with third-world economies are a minority, greatly outnumbered by
those who probably lose.

As I said, I'm not a protectionist. For the sake of the world as a
whole, I hope that we respond to the trouble with trade not by
shutting trade down, but by doing things like strengthening the social
safety net. But those who are worried about trade have a point, and
deserve some respect.

Copyright 2007 The New York Times Company

Sunday, December 30, 2007

Minus Members' Power, Unions Face Mounting Bargaining Woes

This article gives a graphic picture of the problems facing unions in the US. However, similar problems face unions in all developed capitalist societies because of the increasing strength of capital versus labor partly caused by globalisation although I am sure there are multiple factors. Labor has not seemed to be able to develop any powerful international organisations of the sort that they need to confront increasingly globalised capital.

Minus Members' Power, Unions Face Mounting Bargaining Woes

Mark Brenner, Mischa Gaus and Chris Kutalik
Labor Notes
January 2008

William Ehman got acquainted with the current direction of collective
bargaining in his industry from the back of a squad car. The former
president of Steelworkers Local 1537, Ehman led a group of nine
retirees to
a mid-September union meeting to discuss current negotiations with

After the last contract six years ago, the local had stopped providing
transcripts of negotiations with the Pennsylvania specialty steelmaker.
Ehman knew the company's current offer included a two-tier wage
and a shift from defined benefit pensions to a 401(k) plan. Meanwhile
checkbook issue, a retiree health care allowance whose value had
over the past few years, wasn't going anywhere in current talks.

The local had said retirees were excluded from the meeting, despite a
provision in the bylaws that guaranteed them access. Union
told the retirees to leave, but Ehman stood his ground. Soon six police
arrived, and Ehman was hauled away from his union hall in handcuffs,
a criminal trespass complaint.

"It went beyond the pale," he said. "When you start dividing your
against itself, it's just a recipe for disaster."


The situation of Local 1537's retirees is all too common. Indeed, if
anything the story of widescale givebacks under the gun of employers,
courts, and (yes, even) union officials has been told and retold
hundreds of workplaces in the private sector in recent years.

Two-tier agreements, double-digit wage cuts, health care cost shifts,
rule changes, and defined benefit pension and retiree health care
have occurred in one major contract settlement after another with
speed in the past six years. In one industry alone, airlines, wage and
pension concessions given back to employers since 2001 by union pilots,
flight attendants, mechanics, gate agents, and other ground crew
totaled over $15 billion.

Beyond the obvious freefall in bargaining outcomes lie nagging
questions for
labor activists. What trends drive these givebacks? What continues to
the power balance away from workers at the bargaining table?

Behind the simple answer of declining union density, lies another more
fundamental loss, the drop off of strikes, shopfloor organization, and
member-centered levers that were the heart of earlier union victories.

Though these setbacks have all been bitterly felt, they come at the end
of a
long trailing off of the once-strong pattern bargaining agreements that
spurred economic gains for U.S. workers. Forged in the fights of the
and 1940s, the pattern agreements-codified in master contracts-grew
in most industries decade after decade until the 1980s, when the first
concession wave struck.


Unfortunately master contracts continue to unravel in many industries.
their controversial 2007 contract with UPS, the Teamsters agreed to
44,000 UPS members out of their multi-employer Central States Pension
in exchange for organizing rights at the company's non-union freight
division. In addition to weakening a key institution of pattern
bargaining-the multi-employer pension fund-new UPS Freight Teamsters
work under a contract substantially below National Master Freight

Similar declines in master contracts have been seen in auto, grocery,
carhauling. The once-strong master contracts held by the United Food
Commercial Workers in Southern California provide a striking example.
care givebacks were so steep in the wake of the 2003-2004
that the number of workers with health care coverage fell from a
level of 94 percent to its current level of 54 percent.

Worse yet, was the break up of the UFCW Southern California master
itself. In spring of 2007 the union abandoned joint bargaining,
separate agreements between the three major chains and each of the
UFCW grocery locals in the region.

Other unions are moving in the opposite direction, attempting to
national master agreements in spite of heavy odds.

The California Nurses Association has fought to forge a master contract
13 separate agreements at hospitals in the Sutter health care chain.
Importantly, they have flexed their workplace power, launching two-day
strikes in mid-October and again in mid-December. In similar fashion
HERE's 2006 Hotel Workers Rising campaign was an important first step
towards standardizing work at large hotel chains. The Service Employees
International Union (SEIU) has also aggressively pursued industry-wide
standards in healthcare and building services, among other sectors,
sometimes resorting to controversial means such as the nursing home
'template agreements' recently abandoned in California.

The counter-trend can also be found in "old economy" workplaces. The
Steelworkers achieved a national deal with International Paper in
pulling 14 separate, staggered contracts into a uniform pact with a
expiration date. But the unity came at a cost: the national agreement
includes a no-strike clause, and introduces a lower wage tier for new


In recent years many employers have made it a top priority to shed
so-called "legacy costs"-the pension and retiree health care
obligations of
long-unionized firms. Whether at the bargaining table or in bankruptcy
court, employers have waged a bruising battle to sidestep these

Pensions have been hard hit. Since 2001 corporations have dumped
for almost a million workers onto the Pension Benefit Guarantee
the government agency responsible for insuring the nation's defined
pension plans. In other cases, corporations have transferred some or
all of
these costs onto unions through the formation of Voluntary Employees
Beneficiary Associations (VEBA), a key feature in the latest contracts
between the UAW and Big 3 automakers.

Often neglected are the substantial legacy costs associated with the
buy-now, pay-later management strategies of the last 20 years. In the
airline industry, the mergers and acquisitions boom of the late 1980s
$2 billion a year to the industry's debt service burden-and fed into
airlines crisis of the early 1990s.

After recovering ground later in the decade, carriers repeated the
binge, scrambling to expand routes and add capacity. A similar buying
took place in the California grocery industry during the 1990s, as
chains like Kroger, Albertsons, and Safeway gobbled up smaller regional
outlets. Both industries suffered in the 2001 recession.

While their creditors rarely felt any pain, debt-strapped companies
took a
hard line with their unionized employees. The UFCW's
strike in 2004-2005 brought two-tier wages and widespread health care
shifting into Southern California's grocery industry. This pattern will
deeper, as auto-parts manufacturers, steelmakers, and others cry "me
and seek to use the moment to cast off obligations to workers.


Caught between a declining membership and tough-minded employers, many
leaders have turned to labor-management partnerships as a solution to
current difficulties. The UAW-among the first to bat its eyes at
management-has staked its future on keeping the Big 3 automakers
healthy and
competitive. As UAW President Ron Gettelfinger said last summer, "We
have no
interest in tearing down employers. Just the opposite-we want employers
succeed so that workers have a chance to share in that success."

Despite tough talk during this fall's auto negotiations, the union
lived up
to Gettelfinger's words, accepting a less-than-fully-funded VEBA
with a two-tier wage system that sinks union earnings beneath the
manufacturing standard, as part of a package of givebacks designed to
the Big 3 afloat.

But even when unions aren't faced with shrinking numbers or non-union
competition, the promise of partnership has proven seductive. And no
champions dropping "confrontational" approaches to employers more than
President Andy Stern.

Stern explained to the Los Angeles Times on December 7 the kinds of
partnerships he seeks. "I'm talking about appreciating that [members']
employers live in a competitive environment and unions can't be an
around their competitive neck. We understand we need to organize whole
industries or whole markets or whole sectors to not put union employers
at a


Despite the positive rhetoric, partnership has not paved the way to
high-wage jobs for unions like SEIU that organize in the low-wage
service sector. Nor has it preserved good jobs for industrial unions
the UAW. Other unions, however, have chosen a different path.

Through a two-year fight that included strikes, lock-outs, and an
boycott, UNITE HERE Local 2 in San Francisco beat back concessions and
gained new organizing rights. Hotel owners fought to impose pension
cuts and
exclude new hires from the health care plan for their first five years.
Instead, the union won a 64 percent increase in health and welfare fund
contributions and a 69 percent increase in pension contributions,
solid wage increases.

Equally important, the local won a neutrality agreement from all of the
owners in the city's unionized hotels, enabling the union to organize
without interference at all hotels acquired or built by those owners in
Bay Area.

New York's Teamsters Local 804 also successfully bucked the national
of partnership and concession. During recent contract negotiations with
United Parcel Service, Local 804 voted three-to-one against the
national UPS
contract and the local supplement. Although the national contract was
ratified despite important concessions, Local 804 members voted down
the sup
plement in part because it eliminated the 25-year-and-out pension
for new hires. Local 804 members won this benefit almost three decades
through a 13-week strike.

Company officials and national union negotiators put strong pressure on
Local 804 members, warning that their pensions-cut 30 percent earlier
year-would be locked in place if they rejected the local supplement.
after negotiators returned from a second round of bargaining, the new
proposal preserved 25-and-out for new hires and restored their pension
benefits, along with several other key gains.

While there is no magic bullet for winning stronger contracts in tough
times, today's success stories stand out. Union activists and leaders
have been able to buck concessionary trends have fought to do it. They
also rejected the quick-fix of partnership, recognizing that employers'
loyalties lie first and foremost with the bottom line.

Militant strikes and other job actions, while abandoned by many unions
recent years, have proven successful when part of a larger plan. But in
cases, members remain the lynchpin. Where unions are making strides,
are at the center of the process-helping formulate strategy, getting
themselves and their co-workers prepared, and making their power felt
work and in their communities.

Benazir's son, husband hold key to legacy

This is from the Khaleej Times. Bhutto's husband sounds like a prime candidate to visit the Bush ranch at Crawford Texas. Maybe he could become part of the circle of crony capitalists around Bush and his crew.

Benazir’s son, husband hold key to legacy

30 December 2007

ISLAMABAD - The son and husband of Benazir Bhutto are among the main contenders for the leadership of the slain Pakistani opposition leader’s party, which is likely to be decided Sunday.

A senior aide to Bhutto said the former premier’s son was not keen to enter politics yet, leading to speculation that her widower Asif Ali Zardari could effectively take charge of the party until he is older.

Whatever the outcome, both will remain key figures in the Pakistan People’s Party (PPP) founded four decades ago by Bhutto’s father and now the crisis hit country’s biggest opposition group.

BILAWAL: At just 19, the mantle of the Bhutto family’s bloodstained legacy would lie heavy on the head of Benazir’s only son, Bilawal.

If picked for the top slot in the PPP he would be the third leader in its history after his mother and his grandfather, Zufilqar Ali Bhutto, who founded the party and was executed under martial law in 1979.

But he has already shown signs of following in his mother’s footsteps, enrolling earlier this year at Oxford University, where Benazir Bhutto was head of the prestigious Oxford Union debating society.

Bilawal -- meaning one without equal -- was born in September 1988, a month before his mother won general elections under military dictator Zia-ul-Haq to become Pakistan’s first female premier.

“I went back to sleep and woke up to the sound of a congratulatory gunshot being fired outside the hospital, the beating of drums and cries of “Jiye (Long Live) Bhutto. The most celebrated and politically controversial baby in the history of Pakistan had been born,” Bhutto said in her autobiography.

He and his two sisters went into exile with their mother in 1999, dividing their time between London and Dubai, where Bilawal attended school. Reports in local newspapers said he was keen on outdoor sports including target-shooting and horse riding.

At Benazir’s funeral on Friday he was pictured looking composed despite his grief, but analysts say he is currently too young to lead the party.

“Bilawal is just 19 years old, he needs to be groomed,” political analyst and retired general Talat Masood said.

“They should let him complete his education. When he is in a position to assume he should be given the mantle.”

ZARDARI: Nicknamed “Mr. Ten Percent” by Pakistanis because of allegations about kickbacks from his wife’s time in power, Asif Ali Zardari, 51, has gone from playboy to villain and now to grieving political widower.

When he married into the Bhutto political dynasty in 1987, Zardari, then 31, was the little known scion of a landowning polo-playing family from southern Sindh province.

He was born on July 21, 1956 in the rural Sindh district of Nawabshah and schooled in the commercial capital Karachi at the Saint Patrick High School, alma mater of President Pervez Musharraf.

He graduated from the Petaro Cadet College in 1972, an army-run institution known for its discipline and regimented life.

After their arranged marriage Zardari gradually carved out an influential position for himself under his wife’s two tenures in power.

But he was back behind bars within half an hour of the dismissal of Bhutto’s second government in 1996.

Zardari spent eight years in jail -- five of them while his family lived in exile -- before being freed in November 2004 after being cleared over the last of 17 cases of corruption, murder and drug smuggling.

His passion for thoroughbred horses was well known and landed into trouble. One of the charges against him was that he maintained a costly stable in the prime minister’s official residence in Islamabad at state expense.

“Zardari has a very tainted record. He may not consider himself suitable for the party leadership,” Masood said.

“He may leave it to some senior member to lead the party. It will be more appropriate for the party and for him.”


Saturday, December 29, 2007

Bhutto's Rival Blames Death on Government

This is from the New York Times. According to this article the Pakistan People's Party that Bhutto led has not decided whether or not to participate in the January elections if they are held. If the party decides to run then Sharif's party will probably be forced to run as well. Sharif is not favored by the US and he blames the US for supporting Musharraf and he also blamed Bhutto for trying to make deals with Musharraf. Bhutto and the US have said little about the lawyers and supreme court judges who were removed from their posts and jailed for some time. Sharif on the other hand has made restoring the judges one of his prime aims.

Bhutto’s Rival Blames Death on Government
Published: December 29, 2007
NAUDERO, Pakistan — A former prime minister of Pakistan came and laid a wreath Saturday on the grave of his former political rival.

There were riots Friday across Pakistan, including the eastern city of Peshawar, near the Afghan border.
But just before he did it, Nawaz Sharif blamed the military government of Pervez Musharraf for pulling Pakistan into the “grave crisis” that resulted in the assassination of Benazir Bhutto. His words were terse, his eyes dry.

“His policies are responsible,” Mr. Sharif said in an interview on a specially chartered propeller plane that took him to Ms. Bhutto’s ancestral village. “Whether he is responsible or not, an independent commission will have to investigate. No commission can be independent if Musharraf is in charge of this government.”

Mr. Sharif’s antipathy to Mr. Musharraf runs deep. The former general ousted Mr. Sharif in a 1999 coup, which Mr. Sharif tried to prevent by blocking the landing of Mr. Musharraf’s plane in Karachi. Mr. Sharif was tried, convicted and sentenced to life in prison for that, though the sentence was later modified to exile in Saudi Arabia, from which he returned last month.

On Saturday, Mr. Sharif flew to an airstrip in Mohenjo-Daro, where South Asian civilization was born some 5,000 years ago, and from there to the ancestral village of Ms. Bhutto, Naudero, where senior leaders of both their parties met briefly to give their sympathies and discuss the way forward. Mr. Sharif has already said his party would boycott the polls, scheduled for Jan. 8.

He said on his way to Naudero that he hoped Ms. Bhutto’s Pakistan People’s Party would join the boycott. “With Musharraf, Pakistan doesn’t have a future,” he said in the interview.

Farha Tullah Babar, a spokesman for the Pakistan People’s Party, said it was too early for his organization to make a decision about whether to go ahead and contest the elections. The party’s executive council is to meet Sunday afternoon to discuss their plans, including “how the party will be led and by whom,” he said.

Mr. Sharif’s journey the day after Ms. Bhutto was buried traveled the road to Naudero still lined with portraits of Ms. Bhutto’s beaming face, where she was embraced as its native daughter and the town being the stronghold of her party. Mr. Sharif met with Ms. Bhutto’s husband, Asif Ali Zardari, as well as members of the executive council, inside the Bhutto family home.

In the courtyard, hundreds of party members had gathered to mourn for the last two days. Some sat quietly; others shouted slogans when Mr. Sharif’s entourage came in: “By the name of God and his prophet, Benazir is innocent.”

In one corner of the courtyard, a party member named Kaiser Bengali said that he could not help but be struck by the slogan. “I see more anger than grief,” he said.

There is plenty of bad blood between the two parties. It was Mr. Sharif who initially brought a raft of corruption charges against Ms. Bhutto and her husband and Mr. Sharif became prime minister, after her government was dismissed in 1996, charges that Mr. Musharraf continued to pursue until recently.

Mr Sharif was also making a journey across the divide between his native Punjab, the richest and most populous province of Pakistan, and Sindh, its poorer, harsher neighboring province, one of Pakistan’s three minority provinces.

Even political leaders said they noticed a hardening rage against the Punjabi elite that dominates Pakistan’s military and government institutions. The spokesman Mr Babar, himself a Pashtun, one of Pakistan’s other minorities, described the mood as a “strange kind of resentment against the federation itself.” He and other members of the party have warned that the central government under Mr. Musharraf has alienated the three minority provinces and placed dangerous strains on the unity of the country.

“People were shouting slogans,” he said, “The frightening thing was that the federation had lost meaning for them. Yesterday hundreds of thousands of people gathered, they were angry, they were sad, their eyes were full of fire which is hard to describe,” he said.

Mr. Sharif, in the interview, railed against the Bush administration for its “blind support to the Musharraf government.”

He continued: “Now that a major Pakistani political leader has been assassinated, why is he still supporting this man? The whole nation is asking these questions. Does Mr. Bush consider Musharraf his friend or Pakistan his friend?”

He warned that Mr. Bush’s support of the Musharraf government would only heighten anti-American sentiment in Pakistan and the region.

Asked whether he would do anything differently to counter terrorist groups in his country, Mr. Sharif offered no specific remedy except a return to democratic rule. “Terror cannot be fought by one single man,” he said. “A truly elected sovereign parliament is the only answer. Otherwise, Mr. Musharraf is leading this country into a very grave crisis. We are in that crisis.”

Mr. Sharif ruled out negotiations with Mr. Musharraf. “No negotiations with this man,” he said. “Any negotiations and I will be offending the feelings of a 160 million people in this country.”

Muhammad Mian Soomro, the caretaker prime minister, told reporters in Islamabad on Friday that the government would hold talks with all political parties to chart a plan of action, but that “right now, the elections stand as they were announced.”

The Pakistan Peoples Party has not decided on its election plans, though it could be expected to win an overwhelming sympathy vote, which could give it a majority in Parliament, analysts and politicians said. Other parties could also suffer in the polls from a backlash after the death of a national leader.

Several leading politicians said they did not think the government could go ahead with elections so soon after what is being described as a national tragedy that has dismayed people across the political spectrum.

“Speaking on a personal level, there is no mood or inclination to have an election,” said Mushahid Hussain Sayed, secretary general of the Pakistan Muslim League faction that backs Mr. Musharraf. He said the elections could be postponed until March to allow people time to regroup. “Right now there is so much uncertainty.”

The death toll from continuing violence across the country since Ms Bhutto’s death rose Saturday to 38, Brigadier Javed Iqbal Cheema, a spokesman for the Ministry of Interior said. The worst violence has been in Sindh province where protesters have burned buildings and looted shops, but Brigadier Cheema said criminal elements were taking advantage of the situation and Ms. Bhutto’s supporters were not to blame.

He warned anti-government elements of dire consequences if they continued in their destruction. Over 750 shops had been torched and 18 railways stations had been burned, he said.

The controversy over how Ms. Bhutto died has further fueled tension in the country. Three women who washed her body before burial dismissed the government’s version that she had died from hitting her head on a lever in the car roof and said they had seen a bullet wound in the back of Ms Bhutto’s head.

A party spokeswoman, Sherry Rehman, said she was present when they bathed Ms. Bhutto’s body after her death and said she had seen a wound where a bullet has passed through her neck and exited through the back of her head.

Brigadier Cheema stood by his earlier statement that she died from a fractured skull caused by a fall against a lever of the car.

“What we gave you were facts, absolute facts corroborated by the doctors’ reports,” he said at a news briefing Saturday. The medical report released by the government, signed by six doctors, makes no mention of a bullet wound and describes a single wound “on the right temporoparietal region.” It gave the cause of death as “open head injury with depressed skull fracture, leading to cardiopulmonary arrest.”

Brigadier Cheema ruled out an inquiry by international experts into Ms Bhutto’s death, saying that Pakistan did not need any help in the investigation.

Fisk: They don't blame Al-Qaida. They blame Musharraf.

I have watched CBC and US Spokane Public TV and the story is more or less related as Fisk describes. However I just watched headline news. It is possible that some commentaries were more nuanced.
The situation is much more complicated than the story we are getting. As is natural when a person is assassinated most reports do not relay any of the negative aspects of her story as Fisk has done.
Fisk is probably correct that Pakistani intelligence works for i.e. is paid by Musharraf, US, and Taliban etc. If Musharraf was behind the assassinatiion it is a bit puzzling since most commentators think he is now much weakened. It is more likely that Taliban sympathisers in the intelligence and security services aided in the assassination but without Musharraf's support.

Robert Fisk: They don't blame al-Qa'ida. They blame Musharraf
Published: 29 December 2007
Weird, isn't it, how swiftly the narrative is laid down for us. Benazir Bhutto, the courageous leader of the Pakistan People's Party, is assassinated in Rawalpindi – attached to the very capital of Islamabad wherein ex-General Pervez Musharraf lives – and we are told by George Bush that her murderers were "extremists" and "terrorists". Well, you can't dispute that.

But the implication of the Bush comment was that Islamists were behind the assassination. It was the Taliban madmen again, the al-Qa'ida spider who struck at this lone and brave woman who had dared to call for democracy in her country.

Of course, given the childish coverage of this appalling tragedy – and however corrupt Ms Bhutto may have been, let us be under no illusions that this brave lady is indeed a true martyr – it's not surprising that the "good-versus-evil" donkey can be trotted out to explain the carnage in Rawalpindi.

Who would have imagined, watching the BBC or CNN on Thursday, that her two brothers, Murtaza and Shahnawaz, hijacked a Pakistani airliner in 1981 and flew it to Kabul where Murtaza demanded the release of political prisoners in Pakistan. Here, a military officer on the plane was murdered. There were Americans aboard the flight – which is probably why the prisoners were indeed released.

Only a few days ago – in one of the most remarkable (but typically unrecognised) scoops of the year – Tariq Ali published a brilliant dissection of Pakistan (and Bhutto) corruption in the London Review of Books, focusing on Benazir and headlined: "Daughter of the West". In fact, the article was on my desk to photocopy as its subject was being murdered in Rawalpindi.

Towards the end of this report, Tariq Ali dwelt at length on the subsequent murder of Murtaza Bhutto by police close to his home at a time when Benazir was prime minister – and at a time when Benazir was enraged at Murtaza for demanding a return to PPP values and for condemning Benazir's appointment of her own husband as minister for industry, a highly lucrative post.

In a passage which may yet be applied to the aftermath of Benazir's murder, the report continues: "The fatal bullet had been fired at close range. The trap had been carefully laid, but, as is the way in Pakistan, the crudeness of the operation – false entries in police log-books, lost evidence, witnesses arrested and intimidated – a policeman killed who they feared might talk – made it obvious that the decision to execute the prime minister's brother had been taken at a very high level."

When Murtaza's 14-year-old daughter, Fatima, rang her aunt Benazir to ask why witnesses were being arrested Рrather than her father's killers Рshe says Benazir told her: "Look, you're very young. You don't understand things." Or so Tariq Ali's expos̩ would have us believe. Over all this, however, looms the shocking power of Pakistan's ISI, the Inter Services Intelligence.

This vast institution – corrupt, venal and brutal – works for Musharraf.

But it also worked – and still works – for the Taliban. It also works for the Americans. In fact, it works for everybody. But it is the key which Musharraf can use to open talks with America's enemies when he feels threatened or wants to put pressure on Afghanistan or wants to appease the " extremists" and "terrorists" who so oppress George Bush. And let us remember, by the way, that Daniel Pearl, the Wall Street Journal reporter beheaded by his Islamist captors in Karachi, actually made his fatal appointment with his future murderers from an ISI commander's office. Ahmed Rashid's book Taliban provides riveting proof of the ISI's web of corruption and violence. Read it, and all of the above makes more sense.

But back to the official narrative. George Bush announced on Thursday he was "looking forward" to talking to his old friend Musharraf. Of course, they would talk about Benazir. They certainly would not talk about the fact that Musharraf continues to protect his old acquaintance – a certain Mr Khan – who supplied all Pakistan's nuclear secrets to Libya and Iran. No, let's not bring that bit of the "axis of evil" into this.

So, of course, we were asked to concentrate once more on all those " extremists" and "terrorists", not on the logic of questioning which many Pakistanis were feeling their way through in the aftermath of Benazir's assassination.

It doesn't, after all, take much to comprehend that the hated elections looming over Musharraf would probably be postponed indefinitely if his principal political opponent happened to be liquidated before polling day.

So let's run through this logic in the way that Inspector Ian Blair might have done in his policeman's notebook before he became the top cop in London.

Question: Who forced Benazir Bhutto to stay in London and tried to prevent her return to Pakistan? Answer: General Musharraf.

Question: Who ordered the arrest of thousands of Benazir's supporters this month? Answer: General Musharraf.

Question: Who placed Benazir under temporary house arrest this month? Answer: General Musharraf.

Question: Who declared martial law this month? Answer General Musharraf.

Question: who killed Benazir Bhutto?

Er. Yes. Well quite.

You see the problem? Yesterday, our television warriors informed us the PPP members shouting that Musharraf was a "murderer" were complaining he had not provided sufficient security for Benazir. Wrong. They were shouting this because they believe he killed her.

Friday, December 28, 2007

Income Inequality in the United States

Here is an article from this blog. I have invented a new theory to explain what happens when the economy grows. I am not sure what to name it. Originally I thought I would call it the trickle up theory to compete with the original trickle down theory. Unfortunately, the flow upwards is more like a gusher than a trickle. Even the original trickle down theory disguised the fact that when there is a trickle down there is almost always a much larger flow to the upper income earners. It would have been better termed the falling crumbs theory wherein the poor get more crumbs since it is a bigger cake.
Another pop theory is captured by the idea that a rising tide raises all boats. This is a real laugh when applied to economic growth. You can be sure that the extra money created by a growing economy is not shared equally in the way that a rising tide raises all boats big and small equally.

Boy, Have We Got an Inequality Problem
By Jared Bernstein | bio
The Congressional Budget Office (CBO) just updated their invaluable data series on income inequality and the results are startling. Income inequality among households, both before and after Federal taxes, grew more quickly over the last two years of the series, 2003-05, than over any other two-year period on record, back to 1979.

Over those two years, the growth of inequality transferred $400 billion dollars from the bottom 95% to the top 5%. That is, had the income distribution remained as it was in 2003, the income of each of the 109 million households in the bottom 95% would have been $3,660 higher in 2005.

If this is the ownership society at work, I think we need to have a serious talk with the owners.

EPI will post our analysis later in the day (the Center on Budget and Policy Priorities will also post their nifty analysis), but I wanted to share a few of our findings with you right away:

If we break households in groups of 20% each by income, well over half of household income (55%) was held by the richest fifth in 2005, the highest such share on record;
The share of income held by the top 1% has climbed from 9% in 1979 to 18% in 2005.
After-tax income of the bottom 20% grew 6%, or $1,800 over these years (1979-2005, in 2005 dollars); the middle-class gained $11,000, up 21%, over these 26 years. The average income of the top 1%, more than tripled, up 228%, for a gain $781,000.
By 2005, the average post-tax income of the bottom fifth was $15,300, the middle fifth: $50,200, and the top 1%: $1.1 million.
These hugely different growth rates have led to much greater economic distance between income classes over the years. Back in 1979, the post-tax income of the top 1% was 8 times higher than that of middle-income families and 23 times higher than the lowest fifth. In 2005, those ratios grew to 21 (top compared to middle) and 70 (top to bottom), a vast increase in the distance between income classes.

Lest we forget, before our current problems in housing and financial markets developed, the overall economy grew solidly over this recovery, with notably strong productivity growth. Aggregate household income, according to these CBO data, grew $1.1 trillion, 2003-05. But, to put it mildly, these gains have failed to flow broadly throughout the income scale, and the extent of their concentration at the top of the income scale is historically unique. Just under two-thirds (63%) of the gain in household income from 2003 to 2005 went to just 5% of the nation’s wealthiest households.

Such concentration of income is unsustainable in a democratic society.

Pakistan govt. reveals how Bhutto was killed

This is from Information Clearing House.
This account will probably fuel more speculation. Although one would wonder what point there would be in the Pakistan government inventing this account!
A great many Pakistanis apparently think that Musharraf was involved in the operation if not directly at least indirectly through his security or intelligence services.
But it is not clear to me that Musharraf gains anything much from the assassination. The biggest gainers will be the Islamic extremists who can hope to fan the flames of resentment against Musharraf and the US and strengthen support for the overthrow of Musharraf.

Pak govt reveals how Benazir was killed


12/28/07 "IBNlive" -- - -New Delhi: Mystery shrouds the death of former Pakistan prime minister Benazir Bhutto. In an explosive revelation, Pakistan's Interior Minister Hamid Nawaz on Friday said that Bhutto did not die of bullet wounds.

Nawaz said that Bhutto died from a head injury. At least seven doctors from the Rawalpindi General Hospital – where the leader was rushed immediately after the attack – say there were no bullet marks on Bhutto's body.

The doctors have submitted a report to the Pakistan government in which they say that no post-mortem was performed on Bhutto’s body and they had not received any instructions to perform one.

“The report says she had head injuries – an irregular patch – and the X-ray doesn’t show any bullet in the head. So it was probably the shrapnel or any other thing has struck her in her said. That damaged her brain, causing it to ooze and her death. The report categorically ssyas there’s no wound other than that,” Nawaz told a Pakistani news channel.

Government sources say there will be an investigation to determine why no autopsy was conducted.

According to agency reports doctors at the Rawalpindi General Hospital tried desperately for 41 minutes to revive former prime minister Bhutto after she was shot but failed in their efforts.

Bhutto was declared dead 41 minutes after she was brought the hospital's emergency department at 1735 hrs (local time) (1805 hrs IST) with open wounds on her left temporal bone from which "brain matter was exuding", the report said.

It said Bhutto was not breathing at the time and her pulse and blood pressure "were not recordable".

IANS adds: According to the report, "immediate resuscitation (process) was started" and she was taken to the operation theatre where she was attended by a team of doctors headed by Musaddiq Khan, principal of the Rawalpindi Medical College, Dawn reported Friday.

"Left antrolateral thoracotomy for open cardiac massage was performed," the hospital report said, adding: "In spite of all the possible measures she could not be revived and (was) declared dead at 1816 hrs IST (6.16 p.m.)."

An autopsy was not carried out at the hospital "because the district administration and police had not requested the hospital authorities (for this)", the report said.

Bhutto was shot not far from where Pakistan's first prime minister Liaquat Ali Khan was killed by an assassin's bullet on Oct 16, 1951

Of GCC state oil companies and geopolitics

This is from the Khaleej Times. Leave it to an investment banker to set forth the connections between Gulf oil and Big oil and the goings on in national oil companies. An article such as this is worth a dozen of the fluff stuff that passes for reporting in the mainstream press. The GCC is the Gulf States Co-operation Council a body that will merit nary a mention in the puff stuff of the western press.

Of GCC state oil companies and geopolitics

27 December 2007

GEOPOLITICS has shaped the creation, operations and worldview of Middle East owned oil companies ever since the earliest regional oil strikes in Dammam, Persia’s Masjid Suleiman and Kirkuk in the 1930s. Saudi Aramco, Kuwait Petroleum, National Iran Oil Company (NIOC), Algeria’s Sonatrach and Abu Dhabi’s ADNOC own 600 billion barrels of crude oil, half the world’s proven reserves.

Qatargas operates the world’s largest LNG export terminal and owns the world’s third largest offshore oil reserves after Russia and Iran. Middle East oil colossi will determine both the future of the oil and gas markets but also profoundly shape the region’s international relations.

Saudi Aramco, created out of the historic security alliance between the House of Saud and the United States, has acted as the dominant, moderating force in OPEC, the proverbial central bank of black gold. Saudi Arabia, as the swing producer in OPEC, saved the world from catastrophic oil shocks when the Shah of Iran lost his Peacock Throne in 1979, Saddam Hussein invaded Iran in 1980 and Kuwait in 1990, when Hugo Chavez, the Iraqi insurgents and the Niger Delta’s Ogoni rebels triggered speculative oil spirals in 2007.

Saudi Arabia is unique in the energy market because it is not only the world’s largest exporter and lowest cost producer, but also because the Kingdom alone can boost output at short notice. Yet Saudi oilfields, including Ghawar, are ageing. What if Saudi Aramco has overestimated its reserves and future spare capacity, as Houston investment banker Matt Simmons argues in his book, Twilight in the Desert? What if there is no Saudi swing producer to moderate a future oil supply shock?

Iran’s NIOC, born out of nationalist Premier Mohammed Mossadegh’s epic battles with BP and a CIA- M16 countercoup that restored the Shah to power, has a pathological mistrust of Big Oil, particularly the Anglo- American firms. NIOC’s xenophobia was reinforced by the Iranian revolution, the tanker war with Baathist Iraq in the Gulf and the continual threat of American sanctions, military strikes and international banking freezes. Of course, NIOC has also been riddled with corruption and mismanagement on such a scale that its technological capabilities are obsolete, its foreign joint ventures threatened by a suspicious Majlis and White House’s sanctions, its domestic subsidies on gasoline making pollution, smuggling and billion dollar mullah slush funds in the Swiss Alps inevitable.

Kuwait Petroleum shares NIOC’s problem with parliamentary interference. The Kuwaiti Parliament has effectively torpedoed Project Kuwait, foreign investments in Kuwait’s northern oilfields and KPC has often become the victim of power struggles between the tribal / Islamist blocs in the legislature and the Al Sabah ruling clan. Kuwait Petroleum is still traumatised by the impact of Iraq’s invasion in August 1990 (Among Baghdad’s cassus belli was KPC overproduction and attempts to exploits two disputed oilfields!) and the exodus of thousands of Palestinian, Algerian and Yemeni oil engineers and managers from the emirate. Kuwait Petroleum was created after the emirate nationalised the concessions of British Petroleum and Gulf Oil.

Abu Dhabi’s ADNOC has proven the most reliable partner for international oil and gas companies, creating a network of joint venture companies with Big Oil from exploration, production, LNG to shipping and even equity stakes in foreign oil companies from Austria to Canada. Without a contentious Parliament like Kuwait, a xenophobic mindset like NIOC, a vast unexplored hinterland like Algeria’s Sonatrach, a history of corruption and terrorist sabotage like Nigerian General Petroleum, ADNOC has emerged as the most professionally managed, reliable, vertically integrated national oil company in the Middle East with access to the latest drilling, LNG, oilfield management enhanced recovery and downstream technologies.

Qatar is a classic case study of a Gulf emirate where international relations, military alliances and energy policies are inextricably intertwined. Qatar’s offshore North Field gasfield borders Iran, meaning the world’s third largest gas reserves and most extensive LNG export terminals are, in essence, located in the epicentre of a potential war zone. Qatar would not have been able to raise the $20 billion in Eurobonds it floated in the international capital markets in the 1990s had Doha not assured Western oilmen and bankers that its gas assets were not exposed to ruinous political risk. This meant that Qatar negotiated a security alliance with the United States, encouraged Exxon and Occidental Petroleum to invest untold billions in its LNG complex and hosted the Al Udeid Air Base, the Pentagon’s command and control hub for the American wars in Iraq and Afghanistan. In essence, Qatar’s Washington connection not only bought it the political risk insurance to attract the oil patch’s largest companies to help Qatargas replace Indonesia as the world’s largest LNG exporter but also enabled a micro- state to survive in a political chessboard dominated by Saudi Arabia and Iran, Doha’s two powerful regional rivals. Qatar’s acrimonious relations with Saudi Arabia did not prevent its leadership from using the leverage of its huge gasfields to emerge as a significant power broker in GCC and Arab politics. The Dolphin gas pipeline is the most successful cross border GCC energy project that, despite initial Saudi refusal to grant transit rights, is a mission critical for the emerging industrial constellations of Dubai, Abu Dhabi and Oman.

Dolphin Energy has, in essence, linked the economies of Qatar, the UAE and Oman, created a diplomatic triumvirate in the GCC that balances the historic dominance of Saudi Arabia and Iran in Gulf politics. Moreover, with no less than 910 million cubic feet of gas reserves, Qatar is courted by world leaders like Russia’s President Putin, whose secret service sent hitmen to Doha to assassinate Chechen warlords only a decade ago. Qatar has also created an Energy City that seeks nothing less than the creation of a spot market for LNG, a future major trend in the Gulf because of new chilling technologies for gas liquification and the construction of even bigger gas supertankers. Now that the International Court of Justice has resolved the Hawar Islands dispute between Qatar and Bahrain, the scope of Dolphin Energy could well encompass Manama. Gas pipelines, not a common currency or central bank, could well prove the most potent symbol of GCC integration.

Matein Khalid is a Dubai-based investment banker and economic analyst

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Tariq Ali: On Bhutto's Assassination

Guardian - December 28, 2007
Tariq Ali is a well know leftist commentator who knows Bhutto and the situation in Pakistan quite well. He is quite critical of Bhutto but notes that her party has the many poor in Pakistan as its base and could if reformed provide a foundation for democracy in Pakistan.
On the news this morning I see that the US is calling for elections to go ahead. However the main opposition party remaining that of Sharif plans to boycott the elections so if they go ahead they will have almost zero legitimacy.

A tragedy born of military despotism and anarchy
The assassination of Benazir Bhutto heaps despair upon Pakistan. Now
her party must be democratically rebuilt

Tariq Ali

Even those of us sharply critical of Benazir Bhutto's behaviour and
policies - both while she was in office and more recently - are
stunned and angered by her death. Indignation and fear stalk the
country once again.

An odd coexistence of military despotism and anarchy created the
conditions leading to her assassination in Rawalpindi yesterday. In
the past, military rule was designed to preserve order - and did so
for a few years. No longer. Today it creates disorder and promotes
lawlessness. How else can one explain the sacking of the chief
justice and eight other judges of the country's supreme court for
attempting to hold the government's intelligence agencies and the
police accountable to courts of law? Their replacements lack the
backbone to do anything, let alone conduct a proper inquest into the
misdeeds of the agencies to uncover the truth behind the carefully
organised killing of a major political leader.

How can Pakistan today be anything but a conflagration of despair? It
is assumed that the killers were jihadi fanatics. This may well be
true, but were they acting on their own?

Benazir, according to those close to her, had been tempted to boycott
the fake elections, but she lacked the political courage to defy
Washington. She had plenty of physical courage, and refused to be
cowed by threats from local opponents. She had been addressing an
election rally in Liaquat Bagh. This is a popular space named after
the country's first prime minister, Liaquat Ali Khan, who was killed
by an assassin in 1953. The killer, Said Akbar, was immediately shot
dead on the orders of a police officer involved in the plot. Not far
from here, there once stood a colonial structure where nationalists
were imprisoned. This was Rawalpindi jail. It was here that Benazir's
father, Zulfikar Ali Bhutto, was hanged in April 1979. The military
tyrant responsible for his judicial murder made sure the site of the
tragedy was destroyed as well.

Zulfikar Ali Bhutto's death poisoned relations between his Pakistan
People's party and the army. Party activists, particularly in the
province of Sind, were brutally tortured, humiliated and, sometimes,
disappeared or killed.

Pakistan's turbulent history, a result of continuous military rule
and unpopular global alliances, confronts the ruling elite now with
serious choices. They appear to have no positive aims. The
overwhelming majority of the country disapproves of the government's
foreign policy. They are angered by its lack of a serious domestic
policy except for further enriching a callous and greedy elite that
includes a swollen, parasitic military. Now they watch helplessly as
politicians are shot dead in front of them.

Benazir had survived the bomb blast yesterday but was felled by
bullets fired at her car. The assassins, mindful of their failure in
Karachi a month ago, had taken out a double insurance this time. They
wanted her dead. It is impossible for even a rigged election to take
place now. It will have to be postponed, and the military high
command is no doubt contemplating another dose of army rule if the
situation gets worse, which could easily happen.

What has happened is a multilayered tragedy. It's a tragedy for a
country on a road to more disasters. Torrents and foaming cataracts
lie ahead. And it is a personal tragedy. The house of Bhutto has lost
another member. Father, two sons and now a daughter have all died
unnatural deaths.

I first met Benazir at her father's house in Karachi when she was a
fun-loving teenager, and later at Oxford. She was not a natural
politician and had always wanted to be a diplomat, but history and
personal tragedy pushed in the other direction. Her father's death
transformed her. She had become a new person, determined to take on
the military dictator of that time. She had moved to a tiny flat in
London, where we would endlessly discuss the future of the country.
She would agree that land reforms, mass education programmes, a
health service and an independent foreign policy were positive
constructive aims and crucial if the country was to be saved from the
vultures in and out of uniform. Her constituency was the poor, and
she was proud of the fact.

She changed again after becoming prime minister. In the early days,
we would argue and in response to my numerous complaints - all she
would say was that the world had changed. She couldn't be on the
"wrong side" of history. And so, like many others, she made her peace
with Washington. It was this that finally led to the deal with
Musharraf and her return home after more than a decade in exile. On a
number of occasions she told me that she did not fear death. It was
one of the dangers of playing politics in Pakistan.

It is difficult to imagine any good coming out of this tragedy, but
there is one possibility. Pakistan desperately needs a political
party that can speak for the social needs of a bulk of the people.
The People's party founded by Zulfikar Ali Bhutto was built by the
activists of the only popular mass movement the country has known:
students, peasants and workers who fought for three months in 1968-69
to topple the country's first military dictator. They saw it as their
party, and that feeling persists in some parts of the country to this
day, despite everything.

Benazir's horrific death should give her colleagues pause for
reflection. To be dependent on a person or a family may be necessary
at certain times, but it is a structural weakness, not a strength for
a political organisation. The People's party needs to be refounded as
a modern and democratic organisation, open to honest debate and
discussion, defending social and human rights, uniting the many
disparate groups and individuals in Pakistan desperate for any
halfway decent alternative, and coming forward with concrete
proposals to stabilise occupied and war-torn Afghanistan. This can
and should be done. The Bhutto family should not be asked for any
more sacrifices.

· Tariq Ali's book The Duel: Pakistan on the Flightpath of American
Power is published in 2008

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