Month: June 2023

Via Scheerpost.com,

This article is from Seymour Hersh’s Substack, subscribe to it here.

What was not said in the Durham Report?

The first thing to understand about John Durham is that he was a fearless prosecutor who went after organized crime and put in prison retired and active FBI agents who protected the mob for money or other enticements. One of the agents he stopped had enabled James “Whitey” Bulger Jr., once one of America’s most wanted men, the Winter Hill Gang boss who evaded arrest for sixteen years.

In his forty-five years as a state and federal prosecutor in Connecticut and Virginia, Durham worked often and closely with FBI agents, especially on cases that involved violations of federal racketeering statutes.

Durham also handled two inquiries into the CIA’s conduct in the War on Terror, and he did so without angering his superiors in the executive branch. In one case he was asked to investigate the alleged destruction of CIA videotapes of detainee interrogations, the so-called torture tapes. His final report on the matter remains secret, and he recommended that no charges be filed. He was later asked to lead a Justice Department inquiry into the legality of the CIA’s “enhanced interrogation techniques” that resulted in the death of two detainees. In that case, he was told that officers who were given and obeyed what were determined to be illegal orders—there were many of those after 9/11—could not be prosecuted. No charges were filed.

Durham’s 306-page report was made public on May 15, and it pleased no one with its focus on the obvious. The journalist Susan Schmidt, whose byline was a must-read when she was a reporter for the Washington Post, pointed out on Racket News that Durham said the FBI would have done less damage to its reputation if it had scrutinized the questionable actions of the Clinton campaign in 2016: the Feds “might at least have cast a critical eye on the phony evidence they were gathering.”

Schmidt was highlighting a moment in Durham’s report where he hints at the real story: Russiagate was a fraud initiated by the Clinton campaign and abetted by political reporters in Washington and senior FBI officials who chose to look the other way. Durham writes: “In late July 2016, US intelligence agencies obtained insight into Russian intelligence analysis alleging that US Presidential candidate Hillary Clinton had approved a campaign plan to stir up a scandal against US Presidential candidate Donald Trump by tying him to Putin and the Russians’ hacking of the Democratic National Committee.” 

He continues: “this intelligence—taken at face value—was arguably highly relevant and exculpatory because it could be read in fuller context, and in combination with other facts, to suggest that materials such as the Steele Dossier reports and the Alfa Bank allegations . . . were part of a political effort to smear a political opponent and to use the resources of the federal government’s law enforcement and intelligence agencies in support of a political objective.” 

Durham goes on to cite many instances of public statements and private communications of Clinton campaign staffers that were “consistent with the substance of the purported plan.” He finds evidence to suggest that “at least some officials within the campaign were seeking information about the FBI’s response to the DNC hack, which would be consistent with, and a means of furthering, the purported plan.” He adds that “the campaign’s funding of the Steele Reports and Alfa Bank allegations . . . provide some additional support for the credibility to the information set forth in the Clinton Plan intelligence.” 

However, his report focuses on who knew about the Clinton Plan intelligence and when they knew of it, while “the details of the Clinton Plan intelligence,” “facts that heightened the potential relevance of this intelligence to” Durham’s inquiry, and his team’s “efforts to verify or refute the key claims found in this intelligence” are confined to a Classified Appendix.  

It became evident to some members of Durham’s staff that the real story was not about whether or not Trump had pee parties in a Moscow hotel room—one of the headline-producing allegations in the Steele Dossier that consumed the Washington press corps in the aftermath of Trump’s victory in the 2016 election. The issue was whether the Clinton campaign, in its constant leaking of false accusations and false data, had crossed a line. 

I was told that there was tension and frustration overDurham’s initial lack of interest, or reluctance, to go beyond his investigative mandate and look closely at the possibility that some senior FBI officials had openly joined ranks with the Clinton campaign, with its drumbeat of spurious allegations, because, in some cases, of a shared belief in the importance of a Clinton victory in the fall election. Another factor, I was told, was the possibility of promotions—even to high-level Justice Department offices—in a potential Clinton administration. 

Durham, to his credit, did follow the leads that came to his office, but he left them in secrecy—perhaps in the Classified Appendix or perhaps completely off the record. He was seen by some as being mandated only to investigate FBI management shortcomings and believed the public needed a full accounting of the FBI bungling. It was not clear whether Durham, had he decided to expand the parameters of his inquiry to include the implications of the intelligence about the Clinton campaign, would have been allowed to do so. As Durham himself writes, “any attempted prosecution premised on the Clinton Plan intelligence would face what in all likelihood would be insurmountable classification issues given the highly sensitive nature of the information itself.”

The issue with Durham may be that he was the wrong man in what could never be the right job. He had made his reputation with the help of others in the FBI and Justice Department. They had provided him with much of the evidence he used in his Mafia investigations—undercover agents, access to information, wiretaps and extra manpower for manpower for analysis and surveillance. He had made and kept friendships current over the years. But there are no shoulders to lean on when one is investigating colleagues in Washington.

It was not clear to some who worked with him whether Durham understood the ease with which the FBI could game the FISA process and get their way with the special court; nor that he understood the extent to which the serious operators in the intelligence community thought themselves to be above the law. I will never forget a lunch I had in a Chinese restaurant down the highway from the CIA headquarters with a bunch of covert operators from the Middle East. They were making fun of what they depicted as bumbling FBI gumshoes—this was just after 9/11—and I angrily asked one of them how he could mock the FBI when they all had to work together to solve the crime. His answer: “Sy, the FBI? The FBI? They catch bank robbers. And we rob banks. And the NSA? You expect me to work with guys who carry protractors in their shirt pockets and are always looking down at their brown shoes?” 

In the end, and to Durham’s credit, he stuck to his guns and said what he thought about those who wished him to expand his inquiry deeper into the actions of the Clinton campaign in this footnote:

“To be clear, this Office did not and does not view the potential existence of a political plan by one campaign to spread negative claims about its opponent as illegal or criminal in any respect.”

He added, however, that for a campaign to “knowingly provide false information to the government” would be another matter.

How to distinguish the two is the crux of the issue. In his failure—if that’s the right word for it—to get the whole story, Durham resembles one of the blind men in the ancient Hindu parable about a group of blind men inspecting an elephant. Each of the inspectors describes a small part. The elephant is the campaign to link Trump to Russia. The mainstream press, running with the later discredited Russiagate narrative, portrays Trump as a puppet of Putin or even as a double agent of Moscow dating back to the Soviet era. And Durham sees himself merely as the lawyer who was ordered to investigate FBI managerial shortcomings. The public only sees parts of the picture. 

There is more to know.

*  *  *

This article is from Seymour Hersh’s Substack, subscribe to it here.

A group called “Jews Against Soros,” launched by Senior Newsweek Editor Josh Hammer and Missouri AG candidate Will Scharf, has argued that criticism of the billionaire activist is not antisemitic.

“Jews Against Soros will fight back against the common left-wing smear that opposition to Soros and his sprawling network of political organizations is antisemitic,” the group said in a launch statement.

There is nothing antisemitic about opposing George Soros.

Today, we (@willscharf and @josh_hammer) are launching Jews Against Soros, a new grassroots coalition of Jews who oppose George Soros’s radical left-wing agenda.

Find out more at https://t.co/Du1cnTmJzx pic.twitter.com/5KTUzKy5kn

— JewsAgainstSoros (@AntiSorosJews) May 31, 2023

“Attacking Soros for his influence on American politics to say nothing of his nefarious agenda in Israel itself, isn’t antisemitic. It is simply a fact that Soros funds a huge proportion of the radical left in this country. And he must be stopped,” the group continued.

Soros has been criticized by many Jews over his donations to groups such as J Street, an Israel lobbying organization whose leadership has met with Hamas, Just the News reports.

.@josh_hammer and @willscharf have launched Jews Against Soros in a bid to push back against the false narrative that opposing wealthy left-wing megadonor George Soros amounts to anti-Semitism. @AntiSorosJews https://t.co/SpMXWXtQJI

— Alex Nitzberg (@alexnitzberg) June 2, 2023

The billionaire megadonor has also come under fire for funding political action committees which help elect soft-on-crime progressive prosecutors, such as Manhattan DA Alvin Bragg, along with Commonwealth Attorney Buta Biberaj of Virginia, Philadelphia District Attorney Larry Krasner and former St. Louis Circuit Attorney Kimberly Gardner, who resigned last month following numerous scandals (via Just the News).

Authored by Marie Hawthorne via The Organic Prepper blog,

Freedom of speech means a lot to us at the OP.  However, that’s been fading fast, as Daisy has documented, and as though speech restrictions aren’t bad enough, most of us have been lab rats for central planners’ behavioral experiments longer than we probably care to realize.  And now there are Nudge Units.

Huge amounts of money have been poured into “nudge research,” determining the best ways to get populations to change their behaviors without passing laws or using force.

What are Nudge Units?

Let’s look at how these “Nudge Units” got started, what they’ve been used for most recently, and what they’re likely to focus on next.

The concept of “nudging” people into making better choices became popular with the book Nudge—Improving Decisions About Health, Wealth, and Happiness, authored by Richard Thaler and Cass Sunstein, and published in 2008. Their book defines a nudge as:

. . .any aspect of the choice architecture that alters people’s behavior in a predictable way without forbidding any options or significantly changing their economic incentives.  To count as a mere nudge, the intervention must be easy and cheap to avoid.  Nudges are not mandates.  Putting fruit at eye level counts as a nudge.  Banning junk food does not.  (p.6) 

(You may be interested to note that author Sunstein is married to Samantha Power, the administrator of Biden’s US Agency for International Development and previously Obama’s ambassador to the UN. Forbes listed Ms. Power as the 63rd most powerful woman in the world in 2014. Do you think she’s Nudging? ~ Daisy )

Individuals in government and industry quickly realized that the authors’ insights into the decision-making process could be used to manipulate that process in the minds of the general public, many of whom don’t have the time or mental energy for NYT bestsellers.

The British government established its first Behavioural Insights Team in 2010.  It began as a seven-person team within a Cabinet Office nicknamed the “Nudge Unit” then became an independent social purpose company in 2014 before being purchased by Nesta, a larger social purpose company, in 2021. 

These social purpose companies employ experts in promoting desirable behaviors.  So in Britain, for example, they want to cut obesity rates in half and reduce household carbon emissions by 28% by 2030.

I don’t know how successful they’ve been in cutting obesity rates, but the Nudge Unit did prove its effectiveness early on by helping the British government collect an extra £200 million (about $248 million) in taxes in 2017. Not surprisingly, the Nudge Unit has become so popular that they have worked with governments in over 50 countries and have opened subsidiary offices in the U.S., Singapore, Canada, Australia, Indonesia, Mexico, and France.

What does a Nudge look like in the States?

Within the U.S., Nudge Units have been employed by health care systems such as UPenn, and Blue Cross Blue Shield Massachusetts. In a way, this isn’t surprising; American and British citizens alike are known for high obesity rates and poor overall health.  

Promoting good health within the general population seems like a good government goal, and I think most of us would have found this largely uncontroversial before 2020.  We may not always have agreed with the FDA’s exact dietary advice, but most of us would have probably agreed that we, as a nation, don’t need quite so many candy bars.  

However, during 2020, this changed.  Public messaging around health care became far more intense, and some of the advice didn’t make sense.  At the very simplest level, what makes people healthy?  Exercise and proper diet.  Humans have known intuitively for a long time that sunshine is good for us. More recent research has shown that it kills viruses and bacteria. So why were people being forbidden to exercise and even, in some cases, to go outside?

This article isn’t really about the many possible reasons the public was given so much nonsensical advice during 2020 and 2021.  I am just pointing out that, in some ways, the public health messaging campaign during Covid was seen by various governments (particularly the British) as an opportunity to see how far Nudging could influence actual behavior, even when the nudges didn’t make logical sense.

Fortunately (or unfortunately, depending on your point of view), governmental Nudging didn’t influence people nearly as much as various government bodies had hoped. In fact, Nudge author Thaler himself said that, when it came to increasing vaccine uptake, it was time for “pushes and shoves” in the form of passports and more severe restrictions.

But the pandemic is officially over, right? Does this really matter now?

Yes, it still does. 

As we discussed before, the World Health Organization is set to ratify a new pandemic treaty in 2024. As discussed in our previous article as well as in Jose’s more recent article, we have plenty of reasons to believe that more pandemics will come along, and that the WHO will be taking precedence over local and even national governments to address them.  

The WHO has grown a lot since its inception in 1948.  It has had its own Behavioral Insights Team since 2017.  And some of their work, like their campaign to prevent the over-use of antibiotics, has been really important.  But just because they undertake some worthwhile projects doesn’t mean we can assume everything they do is benign.  

It’s crucial to understand that there are no neutral Nudges. Richard Thaler points this out himself in an interview with Sydney Business Insights.  You will always be asked to choose between one thing and another.  Thaler also says in this interview that, within the original British Nudge Unit, their mantra was, “If you want people to do something, make it easy.”   Ask yourself, are people that constantly shoot for the lowest common denominator in a population the ones you want to take guidance from?

Perhaps more significantly, the WHO’s new Chair of their Technical Advisory Group on Behavioral Insights (their Nudge Unit), Prof. Susan Michie, is an active member of Britain’s Communist Party.  Are you comfortable with an avowed communist being responsible for subliminal messaging regarding your health choices?  If you’re a communist yourself, that might be great, but what about the rest of us?  

The people behind the Nudge messages matter. 

Do you want to get your relationship advice from Jordan Peterson or Andrew Tate?  It’ll make a difference.  

And health care is only one area of interest in Nudging.  Right now, in the U.S., that has been the main area of focus.  However, since the first Nudge Unit developed in Britain and then expanded outward, it is reasonable to look to the British to see what may be coming next.  As speculated upon by Laura Dodsworth in her recent interview with Russell Brand, climate change rhetoric will likely ramp up.  

We’ve already seen some examples of it.  The same tools they might have been using ten years ago to get people to choose fruit as opposed to candy bars are now being used to get us to choose insect products instead of meat.  This has had limited effect, as we’ve reported before.

How do they work?

Nudges work best for behaviors that people know they should pursue anyway.  It’s been difficult to Nudge people into doing things they find very unpleasant (like eating bugs) or may have moral qualms about (putting novel substances in their bodies).

So far, the usefulness of Nudging has been limited, but that may change within the next few years simply because messaging of all kinds is about to get so much cheaper, thanks to AI.  ChatGPT and other similar programs will be able to churn out all kinds of little jingles useful not only for traditional companies but for social purpose companies and government programs, as well.  

And as messages of all kinds become cheaper and cheaper to produce, the demands to change our behavior for public health, or the climate, or whatever, will become more and more constant.

It’s going to take more individual effort on our part to sort out the real information from whatever convenient narratives are currently being promoted.  This will apply, not only to current-events type information but also to things like health and self-improvement.  

I’ll say it again because it’s so important:  There are no neutral Nudges.  We are all constantly being Nudged in one direction or another.  We can’t escape Nudges, but we can choose which ones we give our attention to.  

US Capitol Police issued an apology for halting a Christian children’s choir performance of the national anthem, which had been approved by the Speaker’s Office.

According to a person associated with the choir, “certain Capitol police said it might offend someone or cause issues.”

Rushingbrook Children’s Choir were singing the National Anthem in Statuary Hall in the US Capitol when they were interrupted by Capitol police.

A representative from the choir was told that “certain Capitol police said it might offend someone/cause issues.” pic.twitter.com/3J8BSBsBSu

— Citizen Free Press (@CitizenFreePres) June 2, 2023

“Although popup demonstrations and musical performances are not allowed in the U.S. Capitol without the proper approval, due to a miscommunication, the U.S Capitol Police were not aware that the Speaker’s Office had approved this performance,” said the US Capitol Police in a statement to the Epoch Times.

“We apologize to the choir for this miscommunication that impacted their beautiful rendition of the ‘Star-Spangled Banner’ and their visit to Capitol Hill,” the statement continues.

A viral clip shows the Rushingbrook Children’s Choir singing Francis Scott Key’s song, inspired by the persistence of American forces against the British during the War of 1812, in the building’s Statuary Hall—itself recently transformed by ideology after Virginia removed a statue of Confederate General Robert E. Lee in 2020.

Suddenly, the conductor, David Rasbach, is approached by a man who whispers something to him. Rasbach cuts off the performance before the children can deliver the song’s final line: “O’er the land of the free and the home of the brave.” -Epoch Times

According to Rasbach, the group received permission from House Speaker Kevin McCarthy (R-CA), in coordination with the office of Rep. Joe Wilson (R-SC).

In a statement, Reps. William Timmons (R-SC), Russell Fry (R-SC) and McCarthy denounced the incident, and confirmed that permission had been granted.

“We recently learned that schoolchildren from South Carolina were interrupted while singing our National Anthem at the Capitol. These children were welcomed by the Speaker’s office to joyfully express their love of this nation while visiting the Capitol, and we are all very disappointed to learn their celebration was cut short,” the lawmakers said.

The Capitol Police deny telling the group that the performance could offend someone.

“It is not accurate we told them the song could be offensive,” they told the Epoch Times.

Rasbach says that a staffer for Wilson told him to silence the children, after which he walked over to three Capitol Police officers, one of whom said that the group “may not continue singing.”

“This is considered to be a demonstration, and that is not allowed in the Capitol,” she added.

“Do you mean to tell me that a choir of children may not sing the National Anthem in the capitol of the United States?” Rasbach said he asked.

“No, they may not,” the officer responded, per Rasbach.

“I left with a sense of utter disappointment, realizing that our country had certainly changed since the times when, as a child, my family visited the Capitol many times and could go up the grand front steps, unrestricted, roam the Capitol halls at will, ascend the grand, marble staircase and visit the balconies of the stately Senate and House chambers, all while feeling—even as a child—a deep sense of respect and pride that this great building and all that it represents is my birthright!.”

Authored by Ramesh Thakur via The Brownstone Institute,

International politics is the struggle for the dominant normative architecture of world order based on the interplay of power, economic weight and ideas for imagining, designing and constructing the good international society. For several years now many analysts have commented on the looming demise of the liberal international order established at the end of the Second World War under US leadership.

Over the last several decades, wealth and power have been shifting inexorably from the West to the East and has produced a rebalancing of the world order. As the centre of gravity of world affairs shifted to the Asia-Pacific with China’s dramatic climb up the ladder of great power status, many uncomfortable questions were raised about the capacity and willingness of Western powers to adapt to a Sinocentric order.

For the first time in centuries, it seemed, the global hegemon would not be Western, would not be a free market economy, would not be liberal democratic, and would not be part of the Anglosphere.

More recently, the Asia-Pacific conceptual framework has been reformulated into the Indo-Pacific as the Indian elephant finally joined the dance. Since 2014 and then again especially after the Russian invasion of Ukraine in February last year, the question of European security, political and economic architecture has reemerged as a frontline topic of discussion.

The return of the Russia question as a geopolitical priority has also been accompanied by the crumbling of almost all the main pillars of the global arms control complex of treaties, agreements, understandings and practices that had underpinned stability and brought predictability to major power relations in the nuclear age.

The AUKUS security pact linking Australia, the UK, and the US in a new security alliance, with the planned development of AUKUS-class nuclear-powered attack submarines, is both a reflection of changed geopolitical realities and, some argue, itself a threat to the global nonproliferation regime and a stimulus to fresh tensions in relations with China. British Prime Minister (PM) Rishi Sunak said at the announcement of the submarines deal in San Diego on March 13 that the growing security challenges confronting the world—“Russia’s illegal invasion of Ukraine, China’s growing assertiveness, the destabilising behaviour of Iran and North Korea”—“threaten to create a world codefined by danger, disorder and division.”

For his part, President Xi Jinping accused the US of leading Western countries to engage in an “all-around containment, encirclement and suppression of China.”

The Australian government described the AUKUS submarine project as “the single biggest investment in our defence capability in our history” that “represents a transformational moment for our nation.” However, it could yet be sunk by six minefields lurking underwater: China’s countermeasures, the time lag between the alleged imminence of the threat and the acquisition of the capability, the costs, the complexities of operating two different classes of submarines, the technological obsolescence of submarines that rely on undersea concealment, and domestic politics in the US and Australia.

Regional and global governance institutions can never be quarantined from the underlying structure of international geopolitical and economic orders. Nor have they proven themselves to be fully fit for the purpose of managing pressing global challenges and crises like wars, and potentially existential threats from nuclear weapons, climate-related disasters and pandemics.

To no one’s surprise, the rising and revisionist powers wish to redesign the international governance institutions to inject their own interests, governing philosophies, and preferences. They also wish to relocate the control mechanisms from the major Western capitals to some of their own capitals. China’s role in the Iran–Saudi rapprochement might be a harbinger of things to come.

The ”Rest” Look for Their Place in the Emerging New Order

The developments out there in “the real world,” testifying to an inflection point in history, pose profound challenges to institutions to rethink their agenda of research and policy advocacy over the coming decades.

On 22–23 May, the Toda Peace Institute convened a brainstorming retreat at its Tokyo office with more than a dozen high-level international participants. One of the key themes was the changing global power structure and normative architecture and the resulting implications for world order, the Indo-Pacific and the three US regional allies Australia, Japan, and South Korea. The two background factors that dominated the conversation, not surprisingly, were China–US relations and the Ukraine war.

The Ukraine war has shown the sharp limits of Russia as a military power. Both Russia and the US badly underestimated Ukraine’s determination and ability to resist (“I need ammunition, not a ride,” President Volodymyr Zelensky famously said when offered safe evacuation by the Americans early in the war), absorb the initial shock, and then reorganise to launch counter-offensives to regain lost territory. Russia is finished as a military threat in Europe. No Russian leader, including President Vladimir Putin, will think again for a very long time indeed of attacking an allied nation in Europe.

That said, the war has also demonstrated the stark reality of the limits to US global influence in organising a coalition of countries willing to censure and sanction Russia. If anything, the US-led West finds itself more disconnected from the concerns and priorities of the rest of the world than at any other time since 1945. A study published in October from Cambridge University’s Bennett Institute for Public Policy provides details on the extent to which the West has become isolated from opinion in the rest of the world on perceptions of China and Russia. This was broadly replicated in a February 2023 study from the European Council on Foreign Relations (ECFR). 

The global South in particular has been vocal in saying firstly that Europe’s problems are no longer automatically the world’s problems, and secondly that while they condemn Russia’s aggression, they also sympathise quite heavily with the Russian complaint about NATO provocations in expanding to Russia’s borders. In the ECFR report, Timothy Garton-Ash, Ivan Krastev, and Mark Leonard cautioned Western decision-makers to recognise that “in an increasingly divided post-Western world,” emerging powers “will act on their own terms and resist being caught in a battle between America and China.”

US global leadership is hobbled also by rampant domestic dysfunctionality. A bitterly divided and fractured America lacks the necessary common purpose and principle, and the requisite national pride and strategic direction to execute a robust foreign policy. Much of the world is bemused too that a great power could once again present a choice between Joe Biden and Donald Trump for president.

The war has solidified NATO unity but also highlighted internal European divisions and European dependence on the US military for its security.

The big strategic victor is China. Russia has become more dependent on it and the two have formed an effective axis to resist US hegemony. China’s meteoric rise continues apace. Having climbed past Germany last year, China has just overtaken Japan as the world’s top car exporter, 1.07 to 0.95 million vehicles. Its diplomatic footprint has also been seen in the honest brokerage of a rapprochement between Iran and Saudi Arabia and in promotion of a peace plan for Ukraine. 

Even more tellingly, according to data published by the UK-based economic research firm Acorn Macro Consulting in April, the BRICS grouping of emerging market economies (Brazil, Russia, India, China, South Africa) now accounts for a larger share of the world’s economic output in PPP dollars than the G7 group of industrialised countries (Canada, France, Germany, Italy, Japan, UK, USA). Their respective shares of global output have fallen and risen between 1982 and 2022 from 50.4 percent and 10.7 percent, to 30.7 percent and 31.5 percent. No wonder another dozen countries are eager to join the BRICS, prompting Alec Russell to proclaim recently in The Financial Times: “This is the hour of the global south.”

The Ukraine war might also mark India’s long overdue arrival on the global stage as a consequential power. For all the criticisms of fence-sitting levelled at India since the start of the war, this has arguably been the most successful exercise of an independent foreign policy on a major global crisis in decades by India. Foreign Minister S. Jaishankar even neatly turned the fence-sitting criticism on its head by retorting a year ago that “I am sitting on my ground” and feeling quite comfortable there. His dexterity in explaining India’s policy firmly and unapologetically but without stridency and criticism of other countries has drawn widespread praise, even from Chinese netizens.

On his return after the G7 summit in Hiroshima, the South Pacific and Australia, PM Narendra Modi commented on 25 May: “Today, the world wants to know what India is thinking.” In his 100th birthday interview with The Economist, Henry Kissinger said he is “very enthusiastic” about US close relations with India. He paid tribute to its pragmatism, basing foreign policy on non-permanent alliances built around issues rather than tying up the country in big multilateral alliances. He singled out Jaishankar as the current political leader who “is quite close to my views.”

In a complementary interview with The Wall Street Journal, Kissinger also foresees, without necessarily recommending such a course of action, Japan acquiring its own nuclear weapons in 3-5 years.

In a blog published on 18 May, Michael Klare argues that the emerging order is likely to be a G3 world with the US, China, and India as the three major nodes, based on attributes of population, economic weight and military power (with India heading into being a major military force to be reckoned with, even if not quite there yet). He is more optimistic about India than I am but still, it’s an interesting comment on the way the global winds are blowing. Few pressing world problems can be solved today without the active cooperation of all three.

The changed balance of forces between China and the US also affects the three Pacific allies, namely Australia, Japan, and South Korea. If any of them starts with a presumption of permanent hostility with China, then of course it will fall into the security dilemma trap. That assumption will drive all its policies on every issue in contention, and will provoke and deepen the very hostility it is meant to be opposing.

Rather than seeking world domination by overthrowing the present order, says Rohan Mukherjee in Foreign Affairs, China follows a three-pronged strategy. It works with institutions it considers both fair and open (UN Security Council, WTO, G20) and tries to reform others that are partly fair and open (IMF, World Bank), having derived many benefits from both these groups. But it is challenging a third group which, it believes, are closed and unfair: the human rights regime.

In the process, China has come to the conclusion that being a great power like the US means never having to say you’re sorry for hypocrisy in world affairs: entrenching your privileges in a club like the UN Security Council that can be used to regulate the conduct of all others.

Instead of self-fulfilling hostility, former Australian foreign secretary Peter Varghese recommends a China policy of constrainment-cum-engagement. Washington may have set itself the goal of maintaining global primacy and denying Indo-Pacific primacy to China, but this will only provoke a sullen and resentful Beijing into efforts to snatch regional primacy from the US. The challenge is not to thwart but to manage China’s rise—from which many other countries have gained enormous benefits, with China becoming their biggest trading partner—by imagining and constructing a regional balance in which US leadership is crucial to a strategic counterpoint.

In his words, “The US will inevitably be at the centre of such an arrangement, but that does not mean that US primacy must sit at its fulcrum.” Wise words that should be heeded most of all in Washington but will likely be ignored.

Authored by Ed Brodow via AmericanThinker.com,

An isolated incidence of police brutality in Minneapolis gave the left an excuse to scream about systemic racism.  The death of George Floyd at the hands of Minneapolis police was a tragedy, but it cannot prove the existence of institutionalized racist activity.

The Floyd incident raises two critical questions: (1) Is America plagued with systemic racism that justifies the dismantling of our social and political institutions?  (2) Do racist police and justice systems deliberately discriminate against black Americans?

Systemic racism no longer exists in the United States.  Individual instances of racism are occurring and always will occur — against both blacks and whites — but to argue that racism is institutionalized ignores the changes that have occurred in the last 60 years.  “America is now the least racist white-majority society in the world,” said black Harvard sociologist Orlando Patterson.

“The false charge of systemic racism,” said author David Horowitz, “is a convenient cover for the Left’s inability to identify actual racists directly responsible for inequalities in American life.  It is unable to do so because America’s culture is so egalitarian and anti-racist that the numbers of actual racists are so few, and their impact so inconsequential, that they don’t amount to a national problem.”

Systemic racism is a myth invented by the left to create division and political chaos.  

When people say America is plagued by systemic racism, says black author Shelby Steele, they are simply expanding the territory of entitlement.  Black Americans are accorded special privileges in every nook and cranny of our society.  We elected a black president — twice.  

“Blacks have never been less oppressed than they are today,” says Steele. 

 “If you are black and want to be a poet, or a doctor, or a corporate executive, or a movie star, there will surely be barriers to overcome, but white racism will be among the least of them.  You will be far more likely to receive racial preferences than to suffer racial discrimination.”

The term “systemic racism” has “no meaning,” said black economist Thomas Sowell.  “It’s one of many words that I don’t think even the people who use it have any clear idea what they are saying.  Their purpose served is to have other people cave in.”

“I don’t know what systemic racism is,” said black civil rights activist Bob Woodson. 

 “After 50 years of liberal Democrats running the inner cities, where we have all these inequities, race is being used as a ruse, as a means of deflecting attention away from critical questions such as, why are poor blacks failing in systems run by their own people?”

To be truthful about the causes of social disruption in the U.S., we must point a finger not at white America, but rather at the black community.  What we are experiencing is not systemic racism from whites. It is systemic violence, mostly from black people, who “commit murder eight times more per capita than any other group,” in the words of former New York mayor Rudy Giuliani.  The leftist canard that racist police and the justice system deliberately discriminate against black Americans is a lie.

In spite of a continuing history of violence, blacks are not being held responsible for their behavior.  Black men make up six percent of the U.S. population but account for a majority of all violent crime, said Heather Mac Donald in The War on Cops.  Ignoring the obvious connection between black criminality and black incarceration, the left continues to blame the police. 

 “Numerical disparities result from differences of offending,” said black talk show host Larry Elder, “not because of racism.”

Blacks lag behind other groups in economic success, safe neighborhoods, and family cohesiveness.  Addressing the question of who or what is responsible, Heather Mac Donald contends that blacks must be held responsible for their own negative behaviors.  The notion that blacks are victims of a racist society may have been true prior to the 1960s, she says, but this is a half-century after the civil rights movement.

“When Americans are viewed as individuals responsible for their decisions,” says David Horowitz, “it is apparent that disparities in income, education, and even susceptibility to diseases flow principally from poor choices made by individuals who fail to take advantage of the opportunities available to them in a country where discrimination by race or gender is illegal.”

America has come a long way from my childhood on the issue of race.  I remember the separate drinking fountains labeled “white” and “colored.”  That is unthinkable today.  White bullies are no longer running around oppressing everyone else.  White institutional racism is an anachronism.

Authored by Aleksandar Svetski via BitcoinMagazine.com,

Ideological battle lines are being drawn around artificial intelligence, and Bitcoiners need to enter the fray…

I know, I know. Your Twitter feed has probably been drowning in threads and tips from AI bros who have discovered 99 ways for you to save 99 hours every week using ChatGPT or some other list of 99 AI apps.

I’m sick of it too. Trust me, especially considering that most of these AI “experts” were Web3 “experts” last year, NFT “experts” the year before and DeFi or crypto “experts” before that. Trend hopping at its finest.

That’s not to say there’s no value here to be found here. Somewhere beneath or behind the almost-deafening noise coming from these influencooors there is a possible paradigm shift, and a genuine set of use cases. We’ve seen some already, of course.

You can chat with these models to reason out a problem, you can summarize thoughts and ideas, find correlations between ideas, search for some information better than you could with Google and, of course, build more linguistically-functional chatbots. Perhaps the best use case thus far are the dev-assistant tools, but I get the sense that we’ve not yet seen the “Uber moment.”

There is also — somewhere beneath and behind all of the scary talk of artificial general intelligence (AGI) and the idiocy being proposed by bureaucrats and would-be regulators — a more human-centric, human-enhancing use for these tools.

The idea of a language user interface as the next step from the thumb tapping we’ve become used to over the past decade is fascinating, and what we should be thinking about is how to make these tools new “bicycles for the mind,” as Steve Jobs said about computers. It’s very important that we push back against doomer narratives that lean the world toward “approved AI” in order to avoid such tools becoming yet another appendage of the State.

In this short article, I’d like to explore the ideological AI battlefield and its relationship to Bitcoin. Some pretty important battle lines have been drawn, and we must all be aware of them.

BITCOIN REMAINS THE MOST IMPORTANT THING IN THE WORLD

Energy is still the currency of the universe. That’s not changing, and will never change. At the risk of sounding like too much of a hippie: It’s all energy.

People often forget that, and this recent AI hype cycle is a clear example. Most people you talk with, even otherwise smart people, think that AI is the biggest thing happening in the world today, and that it’s mankind’s most important innovation.

I think they’re wrong, in a big way. They’re missing something more foundational.

AI is a tool. When applied well, it’s a very effective tool. But however effective a tool it may be, it needs energy to run. Yes, it can and will enhance how we use and allocate energy, but ultimately, it is an amplifier. A tool. An “engine,” so to speak.

What is Bitcoin?

Well, Bitcoin is like energy. Before the Saylor-haters out there screech about that not being literally accurate: I know! It’s a metaphor, and in my opinion, a useful one. It’s useful because, in the same way we can essentially use energy to measure everything else, money is a measure that helps us (implicitly) account for energy, time and material resources.

If we understand that Bitcoin, on a long enough time scale (generationally speaking, not civilizationally) becomes money, then here’s the truth that AI people are missing:

Bitcoin benefits from all of it, because Bitcoin is the foundation. Everything that happens, every technology, every tool, every innovation, enlarges the total Bitcoin pie.

So, don’t get it twisted: AI is big, but Bitcoin remains king.

Of course, in terms of financial returns, VC money and the like, AI companies will probably outpace both bitcoin returns (in the short term) and also Bitcoin company returns, but that’s to be expected in a fiat world where hype prevails over sanity, and we experience abnormal cyclicality.

AI is also undergoing a sort of renaissance, so there is lots of buzz. This will, in time, stabilize and as bitcoin becomes the unit of account, lo and behold, all of the real value generated from AI will ultimately accrue to bitcoin and bitcoin holders.

So, don’t stress if you’re feeling FOMO on AI. Don’t worry about changing your entire life around because some ex-crypto-turned-AI-expert guy wrote a viral tweet telling you about some new, generative AI tool that will obsolete some and make others mega rich.

Slow and steady continues to win the race. Bitcoin continues to be king.

AI IS AN AMPLIFIER

The second thing we need to realize is this: AI is like the computer or any other technology, for that matter.

It’s an engine. It’s an amplifier.

It will amplify madness, stupidity and lies, or it will amplify soundness, sanity and truth.

It can be used as a tool of control and stupidification, or it can be used as a tool for liberating oneself from minutia and for enhancing one’s intelligence.

The direction we wind up ultimately depends on you.

Which tools are you using? Which do you demand? Which are you building? Which are you supporting?

Companies like Snapchat are building AI tools to infect your mind with nonsense:

Source

OpenAI is busy guard-railing ChatGPT to such a degree that it spends more time apologizing and moralizing than it does answering actual questions.

Bard is, likewise, regurgitating the same kind of garbage, likely because it’s been neutered by “bias-removal” tools and toxicity filters.

These stupidities only serve to constrain people’s accepted thinking and speech, which results in a homogenization of thought. This can have two effects. In the worst case, so-called “safety concerns” lead to “approved AI” which ultimately leads to an internet that is accessed through chat filters with approved speech conditions. The alternative is if we push back and build alternatives. Their ignorance becomes our opportunity. While they focus on wokeness, we can build utility and authenticity.

Which brings me to my final point:

WE’RE IN A GLOBAL AI ARMS RACE

The race is between two versions of the world:

1. On the one hand, we have woke, generalist AIs that everyone is forced to use because newly-formed regulatory bodies deem them “safe” (see the ridiculously-moronic work being done by Gary Marcus to set up such a global committee).

2. On the other, we have a future of distributed, more sovereign tools that people can choose from, that the user evaluates on merits they deem important.

I know which future I want to see, and instead of sitting on the sidelines complaining, I’m working toward building alternative or parallel solutions.

In a future article, I’ll lay out what myself and a few really talented individuals have been working on. A beautiful marriage of Bitcoin as the focal point and Ai as the engine.

In the meantime, know this: The battle lines have been drawn.

It’s iris-scanning, central bank digital currencies (CBDCs) like World Coin on one end, conveniently run by the same leadership as OpenAI, versus Bitcoin and smaller, more accurate, specialized and open-source language models on the other.

Source

We all have to make a choice about the kind of world we want to live in. Woke madness, or awakened sanity? Mainstream and generalized, or local and specialized?

In my next piece, I will present a potential solution, or at least a way forward. Until then, think deeply about what I have said. Don’t get flustered by all the hype. Remain steady in your conviction, remain vigilant with the narratives being pushed and be ready for the next battle — because it’s coming.

Authored by Daniel Lacalle,

Most politicians have used the “Ukraine invasion card” to justify the massive inflationary burst in 2021-2023.

It does not matter if inflation was already elevated prior to the war.

Supply chain disruptions, demand recovery, wage growth… Many excuses were used to justify inflation, except the only one that can make aggregate prices rise in unison, which is the creation of more units of currency well above demand.

Inflationists will blame inflation on anything and everything except the only thing that makes all prices, which are measured in monetary units, rise at the same: Money supply growth rising faster than real economic output.

Supply chain disruption and commodity inflation are caused by monetary expansion: More units of currency going to relatively scarce assets. Profits, wages, or commodities are not causes of inflation, but consequences. The unit used to measure prices is weakened by massive increase of its supply. It is as if I sell apples measured in glasses of milk, and suddenly the issuer of milk puts hundreds of gallons more in the market. My apples will cost more glasses of milk to adjust to the reality of the new unit of measure.

Long-term inflation expectations have risen to 3%, the highest level in twelve years. Furthermore, according to the Bureau of Labor Statistics, in April the Consumer Price Index increased 0.4 percent, seasonally adjusted (SA), and rose 4.9 percent over the past 12 months, not seasonally adjusted (NSA). The index for all items less food and energy increased 0.4 percent in April (SA); up 5.5 percent over the year (NSA). However, commodities have plummeted in the past year.

Crude oil (WTI) is down 38% in the past year, trading below pre-Ukraine invasion level. Gasoil (-44%), gasoline (-40%), heating oil (-44%), natural gas (Henry Hub -74% and NBP -65%) have all plummeted to pre-war levels. Even wheat is down 30% from a year before June 4th, 2023. The FAO Food Price Index has also corrected to a two-year low in May.

Why do commodities plummet in the middle of the China recovery and elevated demand growth and tight supply? Monetary factors again. The massive rate hikes and the subsequent monetary contraction have impacted the internationally quoted prices of goods all over the world. It is more expensive to purchase storage, finance margin calls, hire tankers and start long positions.

If commodities and the Ukraine war were to blame for inflation, why is the consumer price index remain so elevated? Money supply growth is plummeting but not enough to revert the price expansion of 2020-2023 and, in fact, global money supply has not fallen lower than $101 trillion, according to Bloomberg. That is a significant drop in money supply from its highs, and one that justifies the rapid decline in headline inflation, but not enough to revert the price increases for consumers.

Central banks engineered the massive inflationary burst, as proven in the BIS study by Claudio Borio et al (2023 https://www.bis.org/publ/bisbull67.htm) and now find that it is relatively easy to reduce annualized inflation to 4-5% but not that simple to bring it to 2%.

What no central bank wants to tell you is that the only way in which inflation will be brought down significantly is a recession.

That is why they talk of a “soft landing” that is impossible if they truly wanted inflation to fall permanently.

By Peter Tchir of Academy Securities

It turns out the bulls had every right to be Dancing in the Street as stocks posted a very strong week (even the Russell 2000 and Regional Banks participated). Friday’s jobs data seemed to put the nail in the coffin on rate hike fears. The market has decided, rightfully so, that we are almost done with rate hikes and unless we get disastrous inflation data, any future hikes will be small enough not to act as a headwind.

Could the Fed jawbone their way to more hikes? Possibly, but does anyone really think we need to get to 6%? Maybe, maybe we could get talked into 5.5%, but markets should be able to withstand that, probably quite easily. So, the fear of further rate hikes has been nullified as a bearish argument. It should mean that inflation data, will have reduced impact on markets, unless we get some extreme readings pointing to a rebound in inflation (which has not been the case, nor is it likely to be).

That only leaves “recession” fears as a potential stumbling block. As discussed on Friday, markets ran with the strong headline jobs numbers and chose to ignore the much weaker household data (it does play second fiddle to the establishment data, yet it is what is used to determine the unemployment rate). Oil surged on Friday, signaling reduced recession fears (or some optimism on global growth). The 2s vs 10s spread became more inverted, closing the week at -81 bps. It has only closed at a more inverted level on 12 days in the past several years (in March 2023 when hard landing was handily beating soft landing in most forecasts). It is interesting that no one is talking about inverted yield curves anymore (thankfully, as it often attracts far more attention than it deserves), but this reversal to so much inversion (it was “only” -41 bps a month ago) is at least somewhat interesting.

While markets traded as though positioning was very short, basic sentiment indicators, like AAII, CNN Fear and Greed, and simple RSI (Relative Strength Indicator) all point to neutral or even overbought conditions.

As a bear, who is worried about the economy, I’m the most nervous about being wrong as I’ve been at any time in the past two months. The S&P had increased a “whopping” 1.3% from April 3rd to May 31st (a number that seems to surprise many as it feels as if we’ve been in a bull market during that time) and explains why VIX is all the way back to 14.6 the lowest since February 14th 2020!

The lowest VIX since the pandemic started is also something that deserves attention, though it averaged 14.9 from February 2019 to February 2020, with a low of 11.5, so maybe, it is just finally normalizing after the traumatic experience of COVID and ZIRP.

We get a lot of economic data this week, which away from the jobs data (excluding the nasty little household survey) was not strong last week. But I fully expect to be in a good news is good and bad news is bad mentality as the Fed should play the smallest role in markets that it has done for a long time. Really refreshing to write that and hope it is correct.

Across the Globe

With the U.S. and China we see the following:

• Signs that possibly both sides, but certainly the U.S. want to make sure that the tension doesn’t derail the “necessary” trade and links between the two countries.
• Some efforts to offer olive branches, or at least fig leaves to reduce tension (the handshake at the defense forum in Singapore, for example) can create the hope that things can improve.
• What I struggle with most is how many conversations start with “well China needs us more than we need them, so it makes sense for them to want to normalize relationships”. Yet, that the “China needs us more..” is usually just an assertion, rather than a statement backed up by a litany of facts. Without a doubt, there was a time that China needed us as much or more than we needed them, but I continue to suspect that time has passed (the shift from Made In China to Made by China).
  • This article on the China Jet caught my attention. I’m not in a rush to step into a Comac (Commercial Aircraft Corp of China Ltd. – not the most adventurous of names), but the maiden flight with passengers seems like a noteworthy milestone. This story fits with the view that China is in various stages of shifting from just making things for us, to trying to sell their own brands.
  • The yuan has now become a topic of conversation with almost every one of our clients. Not just in terms of hedging it, but them seeing companies trying to use it to their advantage. While the dollar remains the reserve currency, we’ve seen a noticeable and serious increase in attention to they yuan as it develops into a currency used for trade.

Remain cautious on China/US Relations.

Japan continues to benefit from tensions in the Asia Pacific.

It has been a year or more in the making, but Japan does seem to be a beneficiary of what is going on across the globe. The Nikkei is up 21% this year. We see continued interest from companies in Japan. Our theory has been that:

• First tariffs and then COVID lockdowns had companies rethinking China as their manufacturing hub, with other countries in Southeast Asia gaining traction.
• Since Putin invaded Ukraine and we’ve seen the ability to effectively blockade Taiwan, people have been casting their eye towards Japan as their presence on the global stage, powerful (and growing) military offer a degree of “safety” that might not be achievable in other smaller economies in the region.

We continue to see interest in Japan and India growing. India remains the “inflation wildcard” in my “surprise” scenarios for inflation and rates.

The one thing I think we can say for certain regarding Russia and Ukraine, is the world is growing weary of the war. Add Indonesia to the list of countries tossing out “peace” proposals. No obvious peace in sight, (see May’s Around the World for latest comprehensive update on the war). Weirdly or sadly or both, I’m not sure a peace deal does much for global markets as we seem to have accepted the status quo, and it is clear (at least from this seat) that trading relationships have permanently changed in the globe and won’t go back to where they were before the invasion.

Authored by Aldgra Fredly via The Epoch Times,

Japan’s birth rate declined to a record low for the seventh consecutive year, with the number of babies born falling below 800,000 this year, health ministry data showed on June 2.

The number of newborns in Japan fell to 770,747 this year, down 40,875 from the previous year and the lowest since the country began record-keeping in 1899, Kyodo News reported, citing health ministry data.

Japan’s fertility rate—the average number of children born to a woman in her lifetime—fell from 1.30 in 2021 to 1.26 last year, equivalent to the previous low recorded in 2005. The number is far below the 2.07 rate necessary to sustain a stable population.

The decline in Japan’s birth rate is attributed to people delaying parenthood due to the economic impact brought on by the COVID-19 pandemic, as well as the prevailing trend among couples to delay marriage, according to the report.

The data was released after Prime Minister Fumio Kishida unveiled a draft plan to increase child-rearing support as he listed addressing the country’s declining birth rates as one of his top policy goals.

“A last chance for us to reverse the declining births is before the young population is expected to decline drastically in 2030,” Kishida said at a meeting on Thursday.

Kishida’s government said it would come up with specific measures and secure funding by the end of the year.

The government plans to secure annual funding of about 3.5 trillion yen ($25.2 billion) over the next three years for a new childcare package, which includes childbirth and rearing allowances as well as increased subsidies for higher education.

Earlier in January, Kishida urged his government to create a “children-first economic society” and warned that Japan would cease to function as a society if its birth rate continued to decline.

“Japan is at a critical point of whether we can continue to function as a society. Focusing on policies regarding children and child-rearing is an issue that cannot be postponed,” he told parliament on Jan. 23.

Japan’s population of more than 125 million has been declining for 16 years and is projected to fall to 87 million by 2070. A shrinking and aging population has huge implications for the economy and for national security as Japan fortifies its military to counter China’s increasingly assertive territorial ambitions.

According to Japan Meteorological Agency (pdf), the country’s population is expected to fall below 100 million by 2050. Data released by the Cabinet Office showed the aging population is also a prominent issue. As of October 2019, the country’s total population was 126.17 million, where people over the age of 65 accounted for 28.4 percent.

Upon taking serious note of the issue, the country introduced a series of policies to remedy its declining births. Japan has, in recent years, offered cash bonuses and childcare incentives to encourage people to have more children, but these efforts have had little impact.

According to Yomiuri Shimbun’s report, for more than 30 years, the government has introduced various policies that focus on balancing work and childcare. However, those policies were considered inconsistent with the actual needs of families, leaving those wanting to marry and have children without strong prospects.

The report cited Yamada Masahiro, a professor at Chuo University in Tokyo, who spent over 30 years studying Japan’s population problem and wrote a book titled “Why Japan’s Countermeasures Against Declining Births Failed?”

The book claimed that one of the problems is that “the government’s support measures are biased toward women who have graduated from colleges and regular workers in urban areas while ignoring the needs of informal workers and women living in non-urban areas.”