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Update (1215ET): While President Trump confirmed earlier that there was “no need” to leave troops in Syria, he quickly restated his comments, in line with Esper’s earlier remarks, saying that he would work something out to provide the Kurds with cash, perhaps through the involvement of a U.S. oil company.

“We’ve secured the oil,” he said, adding that he’s willing to leave US troops in Syria to secure the oil (and in a second region, due to requests from Jordan and Israel).

*  *  *

The Trump administration may leave some US troops behind in Northeastern Syria to guard oilfields alongside Kurdish-led Syrian Democratic Forces (SDF), according to a Monday statement by Defense Secretary Mark Esper.

The news comes as US troops cross into Iraq as part of President Trump’s announced withdrawal from Syria, after which Turkey promptly launched an offensive against the SDF – whose heads Turkish President Recep Tayyip Erdogan vowed to “crush” last week after he referred to them as terrorists.

Turkey’s nearly two-week old offensive has displaced some 300,000 people and led to 120 casualties among civilians and 470 among SDF fighters, the Syrian Observatory for Human Rights said on Sunday. Turkey says 765 terrorists but no civilians have been killed in its offensive. –Reuters

Over 100 US military vehicles crossed into Iraq early Monday from the northeast tip of Syria, where Turkey agreed to a temporary ceasefire for five days following a deal brokered by the White House according to Reuters. The truce expires on Tuesday, right after Erdogan is set to meet with Russian President Vladimir Putin.

As for guarding the oil fields, Esper told reporters during a trip to Afghanistan that while the US withdrawal was underway, US troops were still operating with partner forces near oilfields, and that discussions about keeping them there had occurred.

Update (1215ET): While President Trump said this morning that he sees “no need” to keep any troops in Syria, he quickly restated his comment, noting that he would work something out to provide the Kurds with cash, perhaps through the involvement of a U.S. oil company.

“We’ve secured the oil,” he said, adding that he’s willing to leave US troops in Syria to secure that oil going forward.

*  *  *

Esper said that was just one option, and that no decisions had been made “with regard to numbers or anything like that,” adding that the Pentagon’s job is to look for different solutions.

“We presently have troops in a couple of cities that (are)located right near that area,” said Esper. “The purpose is to deny access, specifically revenue to ISIS (Islamic State) and any other groups that may want to seek that revenue to enable their own malign activities.”

Trump’s shift has opened a new chapter in Syria’s more than eight-year war and prompted a rush by Turkey and by the Damascus government and its ally Russia to fill the vacuum left by the Americans.

His decision has been criticized in Washington and elsewhere as a betrayal of Kurdish allies who had fought for years alongside U.S. troops in a region rich in oil reserves and farmland.

The New York Times reported late on Sunday that Trump was now leaning in favor of a new military plan to keep about 200 U.S. troops in eastern Syria near the Iraq border. The White House did not immediately respond to a request for comment. –Reuters

Turkey, in an effort to separate themselves from the YPG – a group which makes up the majority of the SDF, is seeking to set up a “safe zone.” The YPG is seen as a terrorist group in Ankara due to its links with Kurdish insurgents living in southeast Turkey. According to Erdogan, his forces will continue their assault in Syria when the deadline expires on Tuesday if the SDF has not retreated from its proposed zone spanning much of the border.

“We will take up this process with Mr Putin and after that we will take the necessary steps” regarding northeastern Syria, Erdogan said on Monday while speaking at an Istanbul forum hosted by TRT World, adding that Turkey will set up a dozen observation posts in the “safe zone,” which as Reuters notes, drew the ire of Iran. 

“We are against Ankara’s establishing of military posts in Syria,” said Iranian foreign ministry spokesman Abbas Mousavi during a Monday broadcast on live state TV. “The issues should be resolved by diplomatic means … Syria’s integrity should be respected,” he added.

Meanwhile, Russia’s Minister of Defense, Sergi Shoigu, said that Moscow – an ally of Syria, hopes it can act as an intermediary between the United States and Turkey to promote security and stability in the region.

On Sunday, the SDF announced their withdrawal from the border town of Ras al Ain during the US-brokered ceasefire, however a spokesman for the Turkish-backed Syrian rebels said the withdrawal was not yet complete. According to Turkish security forces, Kurdish YPG forces were moving toward Al Hasakah – a region south of the proposed safe zone. According to their report, some 125 vehicles had already cleared out, while over 80 Kurdish militants had been captured or had surrendered to Turkish forces.

Authored by Germinal G. Van via The Mises Institute,

Elizabeth Warren is among the strongest contenders and Democratic hopefuls for the presidential election of 2020. During the fourth Democratic debate, on October 15, her “Wealth Tax Plan” received close attention as to how it could reduce income inequality in the United States.

The central argument of Warren’s the wealth-tax proposal is this: through a progressive wealth tax system — which means those with more wealth will pay higher tax rates — the wealthiest people in America will pay their “fair share” and that fair share will enable the equal redistribution of wealth. Set forth by French economists Thomas Piketty, Emmanuel Saez and Gabriel Zucman; this idea for lessening the “wealth gap” is composed of three main planks:

First, households would pay an annual 2 percent tax on all assets for net worth equal or less than $50 million. Individuals and families who are worth more than a $1 billion would pay a 3 percent tax . Second, the Warren forecasts a revenue of $2.75 trillion, and that would be allocated in the creation of new government programs such as universal child care for every child age zero to five; universal pre-k for every three- and four-year-old; student-loan forgiveness; free tuition and fees for all public technical schools, two-year colleges and four-year colleges. Third, the Warren proposal aims to heavily tax corporations so that they would pay their so-called “fair share.”

The plan is, in fact, a type of Robin-Hood tax plan in the sense that it seeks to punitively take from those who have a lot of wealth and distribute it to those with less. The problem with the plan is that, if implemented, it will create three major unintended, yet, detrimental consequences.

The first consequence will be the significant expansion of federal authority over the economy. Even if, in theory, the Warren wealth-tax plan targets only the super wealthy at first, this does not mean that the middle-class is exempted from a potential rise in income tax. For Elizabeth Warren to fund all the programs that she wants to implement, taxing the billionaires — even at a very high level — won’t be enough. The middle-class will eventually be forced to contribute to the funding of these programs, which means that the plan, instead of alleviating the wealth gap, will reduce the purchasing power of the middle-class. This means that ordinary citizens will have a hard time saving for their retirement or to invest in business ventures. Moreover, the plan gives the federal government more extensive power and authority over the allocation of resources and the economy as a whole.

As a result, federal agencies will have far greater control over how resources will be allocated and invested throughout the broader economy. Yet, experience suggests government allocates resources inadequately and inefficiently, while distorting markets, and leading to bubbles and malinvestments. For example, government-owned schools underperform compared to charter schools and private schools, and the medical public sector generally delivers lower-quality healthcare. If government already delivers such outcomes under current conditions, what reason do we have to believe that resources will be better managed when government controls even more resources?

The second consequence will be a great decrease in productivity for the economy overall. Indeed, those who already own large amounts of assets often own those assets because they have managed to put them to good use expanding the economy and increasing employment.  The wealth tax, meanwhile, is built on the premise that government agents can convert that wealth into cash payments, and that the government knows better how to distribute it. 

Moreover, were Warren’s plan to be enacted, many of those subject to the tax may leave the country. This has already been shown to be the case in Europe, where, according to NPR: 

In 1990, twelve countries in Europe had a wealth tax. Today, there are only three: Norway, Spain, and Switzerland. According to reports by the OECD and others, there were some clear themes with the policy: it was expensive to administer, it was hard on people with lots of assets but little cash, it distorted saving and investment decisions, it pushed the rich and their money out of the taxing countries—and, perhaps worst of all, it didn’t raise much revenue.

In France alone, the “wealth tax contributed to the exodus of an estimated 42,000 millionaires between 2000 and 2012, among other problems.”

The Warren wealth tax plan may confiscate the material wealth of wealthy persons and families. But those same people can take their know-how and move elsewhere. The impact on American productivity would not be positive.

Senator Warren’s wealth tax plan, despite the well-intended programs that it will generate; will end up as merely a tool to increase the power of Washington policymakers. Over time, taxes will creep down the income scale as the income tax did, eventually hiking the tax burden for the middle class, while also cutting productivity which will drive down wages and wealth for everyone.

Julian Assange’s extradition trial will move forward in February 2020 after a London judge denied his request for a 90-day extension to submit evidence and formulate his claim that “unprecedented” charges against him are politically motivated.

Judge Vanessa Baraitser of the Westminster magistrates court refused the request, which the United States opposed. The 48-year-old Assange faces 18 counts in the US, including conspiring to violate an espionage law and assisting whistleblower Chelsea Manning with hacking into classified Pentagon computers. The Wikileaks founder could face up to 175 years in prison if convicted. In June, former Home Secretary Sajid Javid signed Assange’s extradition order.

As he entered the dock, on his third public appearance since his arrest in April, people in the packed public gallery raised their fists in solidarity. The former London mayor Ken Livingstone and the journalist John Pilger were among those in attendance. –The Guardian

After his request was denied, Baraitser asked if Assange understood the events in court, to which he replied: “Not really. I can’t think properly.”

“I don’t understand how this is equitable. This superpower had 10 years to prepare for this case and I can’t access my writings. It’s very difficult where I am to do anything but these people have unlimited resources,” Assange continued. “They are saying journalists and whistleblowers are enemies of the people. They have unfair advantages dealing with documents. They [know] the interior of my life with my psychologist. They steal my children’s DNA. This is not equitable what is happening here.”

Approximately 100 activists protested outside, chanting “Free Julian Assange” and “No extradition, there’s only one decision.”

Assange’s supporters converge on van thought to be returning the Wikileaks founder to Belmarsh prison pic.twitter.com/qaHzM4tBA7

— Mattha Busby (@matthabusby) October 21, 2019

Assange attorney Mark Summers claims the US has been spying on Assange, and says there is a link between the “reinvigoration of the investigation and Donald Trump’s presidency,” according to The Guardian. 

“This is part of an avowed war on whistleblowers to include investigative journalists and publishers,” said Summers. “The American state has been actively engaged in intruding on privileged discussions between Mr Assange and his lawyer.”

“We need more time,” Summers added.

He referred to reports that Spanish courts are investigating a security company that allegedly worked in conjunction with the US to “obtain information by unlawful acts, thefts and clandestine surveillance within the Ecuadorian embassy … with increasing intensity from 2017 onwards”, and asked for more time to prepare evidence for the case.

The prosecutor James Lewis QC, representing the government, said he strongly opposed Assange being given more time to prepare evidence, pre-empting their later request. –The Guardian

Following the hearing, German Bundestag member Heike Hänsel warned that journalists who publish “truthful information” face a bleak future.

“The British government and the EU must both reject this extraterritorial political persecution,” she said.

Assange was jailed for 50 weeks last may after a multi-year stay at the Ecuadorian embassy in London starting in 2012 – where he sought safety as Sweden sought to extradite him for questioning over sexual assault claims.

Authored by Julianne Geiger via OilPrice.com,

The American political leadership may not have been able to connect the dots on a withdrawal in Syria, but it’s really quite simple: 

1) Americans step aside

2) Turks swarm across the border and attack Kurds

3) Kurds cut a deal with Assad and the Russians for protection

4) Assad gets his oil back, because it’s all in Kurdish-controlled territory in the northeast

It renders sanctions rather null and void. It empowers Assad exponentially because if there’s one thing he’s desperate for its oil. It gives the last remaining chunk of territory back to Assad, with the exception of Idlib.

Now, conflicting reports are emerging about whether the Americans are actually going to leave Syria.

It’s occurred to Trump, no doubt with some prompting, that an abrupt exit will simply give Assad all of his oil back. 

On Thursday, reports citing an anonymous “military official in Damascus” began to circulate to the effect that the Americans would stick by the key oil area of Dier Ezzor (Dier al Zor), home of the Omar oilfields. 

This report originated with AMN, out of the Middle East. And despite the fact that the source is both unnamed and clearly not an American military source, Western media have also picked up the story in the fashion of the day. 

As of late Thursday, there has been no confirmation whatsoever that the Americans have been ordered to reverse their decision and stick by the oilfields. 

From the Western perspective, the worst-case scenario should be an ISIS resurgence in Syria’s oil heartland. The second worst-case scenario is a fully revived and empowered Assad regime backed by Russia and Iran. 

The US has been impotent against both. 

Who Will Get Syria’s Oil?

The Assad regime is desperate for oil, so the American withdrawal means they can move into Kurd-controlled territory without a fight–even more so now that the Turks have invaded. The Kurds have no choice now but to align themselves with the regime. They are, after all, highly pragmatic. They would put up a good fight against the Turks, but they would not likely best the Turkish military. 

The Kurds controlled everything north of the Euphrates:

(Click to enlarge)

But the Kurds were already dealing in oil with Assad. Again, they are pragmatic. Despite the fact that the Kurds were the key American ally in Syria, the Kurds were supplying the Assad regime with crude through a Syrian broker targeted by US and European sanctions. 

No one cares now. The Trump Administration has washed its hands of Syria.

Regime forces are likely to first take over the Omar oilfield. 

Russia, which has the exclusive rights to extract oil in Syria from the Assad regime, will be eyeing the American withdrawal greedily. Since they’ve already cut a deal with the regime for oil extraction, these two agendas flow together. 

Russia has long been working to secure Syrian oil for itself. It needs this oil–and pipeline access–to strengthen its position in the Eastern Mediterranean. Syria is the key to maintaining Russia’s control of the Mediterranean and getting out in front of any new gas projects that threaten its EU market share. Eventually, Europe’s gas is going to come from the Mediterranean: The question now is who will control that gas. 

Supported by US military advisors and NATO aircraft, the Syrian Kurd SDF forces had succeeded in driving ISIS out of the territory and taking control of the oil-rich Deir Ez-Zor area. This entire area became a major threat to Turkey because it united a large collection of Syrian tribes and clans and ended up weakening Turkey’s ties with the Al Nusra Front. Turkey is now desperate. 

Russia, Iran and Turkey are now going to war for Syrian oil and infrastructure. On paper, Russia has the exclusive rights to produce oil and gas in Syria. The regime has also given the Iranians the port of Latakia, much to Moscow’s dismay; plus, Syria is in substantial debt to the Iranians for credit for fuel. The Russians get the much smaller port of Tartus, which will probably be used for Syrian offshore gas facilities in the prolific Levant basin. 

A resurgent ISIS could wreck everyone’s conflicting plans.

Jihad Incorporated

ISIS has been a rather diversified, integrated company. 

As ISIS oil business dwindled in the face of Syrian Kurd fighting forces backed by American military support and Russian operations, the radical group relied on other avenues of funding, never putting all of its eggs in a single basket. That also means they’re never destroyed. They can regroup elsewhere. 

In just a few years, the Islamic State leadership managed to accrue an estimated $6 billion by various means, with operations in both Syria and Iraq, making itself the wealthiest terrorist group in history. 

In 2018, the US-led coalition fighting against ISIS said that 98 percent of the territory once claimed by the jihadist group across Iraq and Syria has been recaptured.

When it did hold territory, ISIS primarily generated its wealth from three main sources: oil and gas–which it said to have totaled about $500 million in 2015–taxation, extortion and robbery, including the 2014 looting of Mosul during which the Islamic State stole about $500 million from bank vaults–and there have even been indications that ISIS has floated investments in equities. 

And when times are particularly tough, there’s always drug trafficking. 

The area ISIS previously controlled in Syria was also rich in other natural resources, including phosphate, cement and sulfur, from which the group is believed to have generated up to $350 million. Likewise, wheat and barley were said to have generated some $200 million in annual income for the Islamic State.

In 2015 airstrikes, US-led coalition forces destroyed more than 2,500 tanker trucks operated by ISIS, along with mobile refineries and other oil-related infrastructure. By 2017, ISIS oil production in Iraq and Syria had been cut to less than $4 million a month from a peak of $50 million in 2016.

Through its extortion and kidnapping ‘subsidiaries’, ISIS threatened commercial enterprises primarily in eastern Syria and western Iraq in sophisticated protection rackets. In 2014, the UN estimated that the group had generated up to $45 million the previous year in kidnapping for ransom alone. 

It also taxed citizens in territory it controlled, particularly targeting farmers. At its peak, ISIS controlled some 10 million people. Some analysts estimate that these ‘taxes’ netted ISIS around $800 million annually, or around six times the estimated returns from selling oil.

Taxes included everything from “welfare” and “salary” taxes to road taxes, customs taxes for trucks entering Iraq at Syrian checkpoints; non-Muslim protection taxes, and a long list of others. 

The thing is, ISIS doesn’t rely on territory for its economic survival today. It’s raised enough to invest and stash away. After all, controlling territories is expensive in terms of overhead. 

In part, that’s because its surviving leadership may have smuggled as much as $400 million in cash and gold out of Iraq and Syria. The group’s extended network will seek to launder this money through front companies in the region, especially in Turkey.

Since the defeat, the group is raising money through a range of new criminal activities, including but not limited to extortion, kidnapping for ransom, robbery and theft, drug smuggling and trafficking in antiquities.

ISIS is now a full-fledged business, and oil helped it get there. 

What Next?

In order to keep ISIS out, chaos cannot take over–and chaos is exactly what the Americans have unleashed. 

Either Assad’s forces will have to cross the Euphrates and push the Kurds forward, where they would be left to their own devices against the Turks, or Russia will have to step in provide safe passage for the Kurds to move southward away from the Turks. That would come at the price of the Kurds returning territory to the regime. 

If no deal is cut and civil war breaks out, it will be an open door for ISIS, and all that oil will be fair game–again.  

One of the first brands to ever use social media influencers for advertising, Ipsy, is again leading the way – but this time, in pulling back from social media, according to the Wall Street Journal. 

Brands like Ipsy are left questioning whether or not the advertising is worth it, since they have no way to measure sales or verify how many people see ads. Influencer advertising and sponsored content, meanwhile, has become the equivalent of a 30 second TV spot, with big name stars getting as much as $100,000 or more for a single ad. 

But now there is an air of deceit over the marketplace, as many influencers have inflated their follower counts by buying fake followers by the thousands. Influencers have also damaged their credibility with their followers by promoting products that they don’t use. 

JaLynn Evans, a 19-year-old student at Virginia Commonwealth University said:

 “All these paid posts make you question whether influencers are genuine or just doing it for the money.”

We hate the disappoint you, JaLynn, but you’re probably not going to like the answer…

This loss of trust has undermined the power of influencers. Marcelo Camberos, Ipsy’s chief executive said: “Have they peaked? I don’t know.”

And it’s also difficult to track how well influencer ads perform. One way to track, monitoring the number of “likes” a post generates as a percentage of the account’s followers, is showing that engagement is waning. 

Anders Ankarlid, chief executive of online stationery retailer A Good Company, said: “Consumers can see if someone honestly cares about a product or whether they are just trying to push it. The bubble is starting to burst.”

But advertisers can’t ignore social media outright. Instagram has 1 billion monthly users and it is estimated that companies will spend $4.1 billion and $8.2 billion globally on influencers in 2019. This is up from $500 million in 2015, but still just a fraction of the $624.2 billion in total that companies will spend on advertising this year. 

Walmart began adding influencer posts to its website this year and last year, Unilever warned that fraud “undercut the power of influencers” – right before its investment arm bought a stake in a software company that helps brands oversee influencer campaigns. 

But the money paid to influencers continues to climb by about 50% each year since 2017. Prices per Instagram post range from $200 for an influencer with as little as 10,000 followers, to more than $500,000 for celebrities with millions of followers. 

One lawsuit filed this year gave a glimpse into exactly how much celebrity influencers are paid. Ariana Grande sued Forever 21, Inc. for allegedly stealing her likeness after she rejected an endorsement deal with the retailer. Grande has 165 million Instagram followers and the lawsuit claimed that “…the market value for even a single Instagram post by Ms. Grande is well into the six figures.”

Akash Mehta, an influencer with 293,000 Instagram followers was offered $10,000 for a single post and has been paid by brands like Volvic Water and Ulysse Nardin in the past. Hilariously, he claims that the offer, which was five times his $2,000 asking price, “was a turning point” and that it made him “realize that influencer marketing has gone wrong.”

But of course, this didn’t stop him from accepting the payment. 

Meanwhile, HypeAuditor, an analytics firm, investigated 1.84 million Instagram accounts and “found more than half used fraud to inflate the number of followers.”

“When you pay for a billboard, you know roughly how many people will see it. With Instagram you have no idea. Followers can be bought,” Mehta said.

Click farms sell followers and employ people to inflate online traffic. You can buy 1,000 bogus YouTube followers for as little as $49. On Facebook, 1,000 followers will cost you $34 and on Instagram, it’ll cost you $16.

Influencer deception will cost advertisers $1.3 billion this year. 

Matteo Del Vecchio, chief executive of Alexis Bittar’s parent company, Deconic, which is owned by Brooks Brothers said: “We scaled back paying for posts. It’s difficult to quantify how that translates into sales.”

And so, instead, companies like the Gap and Banana Republic are now trying to tap into their own customer base, offering real life shoppers $150 gift cards to pose with their favorite branded outfits on Instagram. One customer who was recruited, 21 year old Cassie Fisher, said: “My friends and I are sick of being sold things all the time. When you scroll through your Instagram feed, it’s one sponsored post after another.”

But money talks, bullshit walks: like Mehta, this didn’t stop her from posting a photo of herself wearing Banana Republic pants.

Advertising executive James Cole said: “When Instagram started, it was a place you looked at images posted by your friends or other people you trusted. Brands ruined it by injecting their own messages. Consumers are wising up to the fact that just because an influencer posts about a product doesn’t mean they actually like it.”

You can read the full longform WSJ writeup here.