Report: NATO is not winning in Afghanistan.

NATO should never have gone into Afghanistan in the first place nor should there have ever been the misnamed Operation Enduring Freedom. Karzai's government is dependent upon the occupiers but he is nevertheless not a reliable puppet. In fact, he is trying to make deals himself with the Taliban even offering posts in his government. After all, someone who can live with former warlords and "reformed" Taliban in his present government will not care about the sensibilities of his Western handlers if it can save his own skin. The sooner that the US and allies come to their senses and the U.S. gives up its imperial designs wrapped up in flowery moral rhetoric the better. What they have produced is a government that produces most of the world's opium, condemns a journalist to death for distributing material on women's rights. It also condemned a Muslim convert to Christianity to death and kicked a female legislator out of the legislature because she criticised her fellow legislators. Even if NATO wins what you will have is a government that will be far from having any of the religious and human rights associated with western democracies. But face it that is not the point, the point is that the government goes along with US policy and interests for the most part. This is from the Washington Post.

NATO's Not Winning in Afghanistan, Report Says
By Ann Scott TysonWashington Post Staff Writer Thursday, January 31, 2008; Page A18
NATO forces in Afghanistan are in a "strategic stalemate," as Taliban insurgents expand their control of sparsely populated areas and as the central government fails to carry out vital reforms and reconstruction, according to an independent assessment released yesterday by NATO's former commander.
"Make no mistake, NATO is not winning in Afghanistan," said the report by the Atlantic Council of the United States, chaired by retired Gen. James L. Jones, who until the summer of 2006 served as the supreme allied commander of NATO.
"Afghanistan remains a failing state. It could become a failed state," warned the report, which called for "urgent action" to overhaul NATO strategy in coming weeks before an anticipated new offensive by Taliban insurgents in the spring.
The Atlantic Council report was one of two strongly worded assessments of the war in Afghanistan -- both led by Jones -- released at a Capitol Hill news conference yesterday. The second was by the Afghanistan Study Group, co-chaired by Jones and Thomas R. Pickering, a former U.S. ambassador to Russia and other nations.
Jones said several steps are needed to "regain the momentum that appears to have been lost" in Afghanistan: a comprehensive campaign plan that integrates security and reconstruction work; the appointment of a United Nations High Commissioner to coordinate international efforts; and a new regional approach to stabilizing Afghanistan that would include conferences with neighboring countries such as Pakistan and Iran.
Progress in Afghanistan "is under serious threat from resurgent violence, weakening international resolve, mounting regional challenges and a growing lack of confidence on the part of the Afghan people about the future direction of their country," said the report by the Afghanistan Study Group, created by the Center for the Study of the Presidency, which was also involved with the Iraq Study Group.
"The United States and the international community have tried to win the struggle in Afghanistan with too few military forces and insufficient economic aid," the report said. It highlighted the lack of a clear strategy needed to "fill the power vacuum outside Kabul and to counter the combined challenges of reconstituted Taliban and Al Qaeda forces in Afghanistan and Pakistan, a runaway opium economy, and the stark poverty faced by most Afghans."
The study group said the United States should "decouple" Iraq and Afghanistan to establish a clear distinction between the funding and programs underway in the countries, which, it said, face different problems. It also called on Washington to appoint a special envoy for Afghanistan.
Violence has risen 27 percent in Afghanistan in the past year, with a 39 percent increase in attacks in the nation's eastern portion -- where most U.S. troops operate -- and a 60 percent surge in the province of Helmand, where the Taliban resurgence has been strongest.
Suicide bombings rose to 140 in 2007, compared with five between 2001 and 2005, according to official figures. U.S. and other foreign troop losses -- as well as Afghan civilian casualties -- reached the highest level since the U.S.-led invasion overthrew the Taliban government in 2001.
Amid the rising violence, the Pentagon announced this month that it would deploy 3,200 Marines to Afghanistan to help counter the expected Taliban offensive.

The reckless greed of the few harms the future of the many

This is an interesting analysis of the financial crisis by Will Hutton from the Observer. It seems that the reckless greed was not just of a few. Throughout the world major financial institutions are now writing off investments they took as money makers. So far I have not seen much move to strengthen lending regulations by the government. The deregulation of the financial sector was supposed to remove the dead hand of government and let markets reign. The government Hand is dead only when it restricts profits, but when runaway capitalism causes crises the government Hand is called upon for Handouts.

This reckless greed of the few harms the future of the manyThe government must act firmly to control an industry that destabilises all our lives with its naked pursuit of huge profits Will HuttonSunday January 27, 2008The Observer
Never in human affairs have so few been allowed to make so much money by so many for so little wider benefit. Across the globe, societies and governments have been hoodwinked by a collection of self-confident chancers in the guise of investment bankers, hedge and private equity fund partners and bankers who, in the cause of their monumental self-enrichment, have taken the world to the brink of a major recession. It has been economic history's most one-sided bargain.




Last week's financial panic was further evidence of the extreme foolhardiness with which global finance has been organised and managed. There was the biggest one-day fall in Wall Street since 11 September, which spilled over into every world stock market and the largest single cut in American interest rates for 25 years as an emergency attempt to stop the rout. A new crisis emerged in an obscure American insurance business (monoline, it is called). To cap it all, there was the £3.7bn bank fraud at Société Générale.
The growing realisation of how exposed the financial system is - and from transactions that should never have taken place - is reinforcing the mounting credit crunch, which, in turn, is spooking stock markets. The US economy is weakening while in Britain new mortgage lending is at a 10-year low. The staples of a settled life - jobs, pensions and house prices - are all under threat.
The availability of credit is one of the fundamental pillars of any economic system. Like the delivery of gas, electricity and water, finance should be regarded as a utility and after the credit-crunch disasters of the 1930s, following the free-market 1920s, it was regulated as one. But Anglo-American financiers have used the theories of the free-market fundamentalists to argue that it should be liberated from such regulatory 'shackles' and again run as a business like any other.
Yet finance is not like any other business. When a bank makes a mistake, the ramifications for the rest of the financial and economic system are so severe that it has to be bailed out - witness Northern Rock. Because of this truth, financiers have organised themselves so that actual or potential losses are picked up by somebody else - if not their clients, then the state - while profits are kept to themselves. An industry that socialises losses while privatising profit, and that has the capacity to create booms and busts alike, has to be as closely regulated as any utility.
I was reminded of the system's proclivities by a consultant friend who was hired to arbitrate over a performance bonus between a hedge fund and one of its asset managers. The individual in question was paid a base salary of some $100,000, but the investment funds he managed had done well over 2007, rising in value by more than $500m. His bonus was $206m and he felt that to conform to industry norms, his bonus should be nearer $250m - the cause of the dispute.
What, I asked, would happen in 2008 if the assets he managed fell in value? He would get paid his base salary and no bonus came the reply. And would he be required to repay any of the $250m he had pocketed this year? Of course not.
This is the one-way, short-term bet that is endemic in the way the financial services industry rewards itself and which incentivises recklessness. Raghuram Rajan, former chief economist of the IMF, differentiated between two sources of wealth generation in the financial markets in an insightful article in the Financial Times earlier this month. There is run-of-the-mill 'beta' value created because stock markets and the economy are set fair and going up; then there is special 'alpha' value generated by investors such as American billionaire Warren Buffett who see opportunities others do not.
The problem is that while we know a priori that there are only one or two Buffetts around who deserve alpha-style pay, this has become the way the entire financial system's executive class rewards itself - being paid as if just one year's performance revealed them to be alpha superstars when, in truth, most are ordinary beta performers. It takes longer than a year to reveal who is alpha and who is beta, whatever executives like the hedge-fund manager in dispute over his bonus may claim.
The remuneration structure is a disaster. One of the reasons why rogue trader Jérôme Kerviel faked a stunning £3.7bn of transactions at SocGen may have been because he regarded himself as being paid as a beta when he should have been paid as an alpha like everybody else. Moreover, he was able to fool the bank by trading in the daffy instruments that the financial system created to persuade national governments that it is not running excessive risks, an insurance that laid off risks to others. Hence the casino character of many new financial markets, which essentially operate as bookmakers accepting differing bets on future prices. Underneath their technical names - monoline insurance, derivatives, debt securitisation - lies little more than bookie principles and practice.
But selling off bad risks doesn't mean the catastrophe won't occur. And when the balloon goes up, the financial system screams for government intervention - to cut interest rates aggressively and to bail out stricken banks and insurance companies. Indeed, better still for the financiers, a gullible government can be persuaded to assume the risk, the exact principles of the Goldman Sachs-devised bail-out of Northern Rock - lubricated by excessive fees to the partners.
Thirteen years ago, I tried to blow the whistle on financial market liberalisation in my book The State We're In. It was obvious then what is even more obvious now: financial market freedom embeds short-termism, guarantees lower investment, works against business building and innovation, generates booms and busts, inflates house prices, creates system-wide risk and excessively rewards those who work in them. I thought the Germans and Japanese were better than the British and Americans in the way they organised and regulated finance and that while Britain and America might look good in the short term, their economies would eventually come back to earth with a bump.
New Labour threw a protective mantle around the financial markets in a way it never would for industry and sceptics were patronised as backward-looking, Old Labour know-nothings. Let's hopes these new crises will prompt a root-and-branch rethink. Of course, like the Americans, the British need to respond by aggressively cutting interest rates, cutting taxes and lifting public spending.
But more, we need to regulate closely how the financial system deploys its capital, develops its loans and how its people are paid, an initiative that requires global support. We need the financiers to serve business and the economy rather than be its master.
This is not a question of helping the financial system better to understand the risks it runs through more 'transparency', the friendly diagnosis deployed by both the Governor of the Bank of England and the Prime Minister in speeches last week. This is about reworking the one-sided bargain between finance and our economies. Only then can we lay the foundations for recovery and bring some semblance of fairness and rationality to the way these plutocrats behave.