Bank of England director: Occupy was right

Published: Oct. 30, 2012 at 2:30 AM

LONDON, Oct. 30 (UPI) -- The protesters who occupied Wall Street and parts of London and other cities were morally and intellectually right, a senior Bank of England official said.
"Some have suggested ... that Occupy's voice has been loud but vague -- long on problems, short on solutions," Andrew Haldane, a member of the central bank's Financial Policy Committee, told an event called "Socially Useful Banking," organized by Occupy Economics, an offshoot of the Occupy movement, in London Monday night.
"Others have argued that the fault lines in the global financial system, which chasmed during the crisis, are essentially unaltered -- that reform has failed," he said.
"I wish to argue that both are wrong -- that Occupy's voice has been both loud and persuasive and that policymakers have listened and are acting in ways which will close those fault lines," said Haldane, the bank's executive director of financial stability.
"In fact, I want to argue that we are in the early stages of a reformation of finance, a reformation which Occupy has helped stir," he said.
"Occupy has been successful in its efforts to popularize the problems of the global financial system for one very simple reason -- they are right," said Haldane, 45.
He added that protesters who camped out in New York, London and dozens of other cities "touched a moral nerve in pointing to growing inequities in the allocation of wealth."
But the nerve the movement touched was in fact more than just moral, he said -- it was intellectual, borne out by facts.
"For the hard-headed facts suggest that, at the heart of the global financial crisis, were -- and are -- problems of deep and rising inequality," he said.
Haldane ended with a direct appeal to activists to continue putting pressure on governments and regulators.
"You have put the arguments. You have helped win the debate. And policymakers, like me, will need your continuing support in delivering that radical change," he said.

Read more: http://www.upi.com/Top_News/World-News/2012/10/30/Bank-of-England-director-Occupy-was-right/UPI-98241351578600/#ixzz2AlVmJNC9

The dark side of Wikipedia

Wickedpedia: The dark side of Wikipedia

Summary: Behind the Web site, Wikipedia stories are being manipulated for cash and written and edited by insiders without a clue while outside experts are ignored.

By Steven J. Vaughan-Nichols for Between the Lines | September 25, 2012 -- 14:55 GMT (07:55 PDT)

51

Wikipedia looks less trustworthy by the day.

http://www.zdnet.com/wickedpedia-the-dark-side-of-wikipedia-7000004731/

Do a Web search on any popular product, event, company, person, whatever. What's the first site that shows up? Chances are it's Wikipedia. For better or for worse, people assume that anything they find in Wikipedia is Gospel truth. That's very foolish. It now seems that some of Wikipedia's writers and editors have sold out the truth for their own gains.

As reported by Violet Blue, two Wikipedia insiders, Roger Bamkin and Max Klein, have allegedly written, edited, and placed Wikipedia articles for paying clients.

The facts appear damning. Klein's consulting businessuntrikiwiki comes right out and states: “A positive Wikipedia article is invaluable SEO: it's almost guaranteed to be a top three Google hit. Surprisingly this benefit of writing for Wikipedia is underutilized, but relates exactly the lack of true expertise in the field. ... WE HAVE THE EXPERTISE NEEDED to navigate the complex maze surrounding 'conflict of interest' editing on Wikipedia. With more than eight years of experience, over 10,000 edits, and countless community connections we offer holistic Wikipedia services.”

Oh yeah, that sure sounds like a Wikipedia editor and not a shill. Since the scandal broke, Klein has tried to spin his business, “We’ve never made a single edit for which we had a conflict of interest on Wikipedia – ever. Although we have advertised such a service, we’ve not aggressively pursued it – and we have not accepted any clients interested in on-Wikipedia work.” So, Klein advertises a service in ALL CAPS in true spammish fashion, but he's never done it? Interesting.

He went on, “We believe – strongly – that there’s nothing inherently wrong with accepting for-profit engagements that involve contributing to Wikipedia, as long as it’s approached in a transparent and ethical fashion.” Jimmy Wales, Wikipedia's founder would appear to disagree: Wales wrote in 2009  that “It is not ok with me that anyone ever set up a service selling their services as a Wikipedia editor, administrator, bureaucrat, etc. I will personally block any cases that I am shown.”

Bamkin has since resigned as a Wikimedia UK trustee . Klein is still listed as a Wikpedian in Residencefor OCLC Research. The Wikipedia internal conflict over whether their actions should be condemned or whether the accusations are unfair attacks from outsiders continues in the site's discussions forums. The mere fact that many Wikipedia insiders are unable to see the problems speaks volumes.

For years, Wikipedia has danced around scandals about its reliability and transparency. The worst example of this, before this current scandal, was when a major Wikipedia site administrator and employee called Essjay, who claimed to be “a tenured professor of religion at a private university” with “a Ph. D. in theology and a degree in canon law,” was proven to be a high-school dropout. Wales first defended him but then distanced himself.

Aside from the scandals, Wikipedia's unique combination of self-righteousness and know-it-allism has long led it to deny experts from outside its closed circle from writing and editing stories. The most egregious recent example was when Wikipedia's editors wouldn't correct an entry about a novel by famous American author Philip Roth when the writer himself reported the error.

In a New Yorker article Roth explained, that he had asked for a serious misstatement about his novel “The Human Stain.” be removed. I'll let Mr. Roth explain what happened next:

Yet when, through an official interlocutor, I recently petitioned Wikipedia to delete this misstatement, along with two others, my interlocutor was told by the “English Wikipedia Administrator”—in a letter dated August 25th and addressed to my interlocutor—that I, Roth, was not a credible source: “I understand your point that the author is the greatest authority on their own work,” writes the Wikipedia Administrator—“but we require secondary sources.”

So there you have Wikipedia in all its glory: Touched with corruption, employing fakes, and so sure of its own correctness that it won't listen to the real experts. Have fun faking up your reports from Wikipedia articles kids!

Related Stories:

• CNET: Wikipedia honcho caught in scandal quits, defends paid edits
• CNET: Corruption in Wikiland? Paid PR scandal erupts at Wikipedia/
• Wikipedia founder calls for UK 'pirate' extradition to stop
• Wikipedia: If you see ads on our site, you have malware
• Good-bye Encyclopedia Britannica: Good-bye to the printed record

Topics: Social Enterprise, Censorship, Networking, Tech Industry

About Steven J. Vaughan-Nichols

Steven J. Vaughan-Nichols, aka sjvn, has been writing about technology and the business of technology since CP/M-80 was the cutting edge PC operating system. Elsewhere on ZDNet, SJVN covers Networking and Open Source.

German gold has been gone

German gold has been gone since 2001, Turk tells King World News

Submitted by cpowell on Thu, 2012-10-25 20:09. Section: Daily Dispatches

2:52p CT Thursday, October 25, 2012

Dear Friend of GATA and Gold:

GoldMoney founder and GATA consultant James Turk, whose 2001 commentary first posted at his Free Gold Money Report Internet site, "Behind Closed Doors" --

http://www.fgmr.com/behind-closed-doors.html

-- and republished at GATA's Internet site --

http://www.gata.org/node/1088

-- martialed the evidence that the United States had swapped gold with the German Bundesbank for market-rigging purposes, today tells King World News that all the German gold vaulted abroad has been gone, leased into the market, for 11 years. Excerpts from the interview and Turk's 2001 commentary are posted at the King World News blog here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/10/25_J...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

The Central Banker is Naked

Telegraph's Evans-Pritchard did try to get comment from central banks

Submitted by cpowell on Fri, 2012-10-26 16:04. Section: Daily Dispatches

11:05a CT Friday, October 25, 2012

Dear Friend of GATA and Gold:

Your secretary/treasurer's dispatch yesterday criticizing the Telegraph's international business editor, Ambrose Evans-Pritchard, and CNBC Senior Editor John Carney for not getting comment from the German Bundesbank and the Bank of England for their reports about the mysterious and long-secret removal of some German gold reserves from London --

http://www.gata.org/node/11868

-- today drew a cordial explanation from Evans-Pritchard. He wrote that he did indeed seek comment from both central banks for his report, that the Bundesbank's reply came too late for his publication deadline and didn't do more anyway than confirm the withdrawal of the German gold, offering no motive for it, and that, as usual, the Bank of England refused any comment at all. While his inability to get comment from the central banks was omitted from his report, Evans-Pritchard said, this was largely a matter of timing and lack of space in the newspaper yesterday. With more space and time Evans-Pritchard might have cited the refusal of the central banks to explain.

GATA believes that holding central banks to account in regard to gold and everything else they do should be the big objective of financial journalism and that the refusals of central banks to account for themselves should always be reported prominently. Anything less normalizes their unaccountability. Fortunately for journalism and unfortunately for the world generally, practically every day will continue to give Evans-Pritchard and all financial journalists more chances to note that while central banks run the world in secret they seldom answer questions about it, considering themselves above any democratic system of government.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

A Hostile Takeover of Our Country

A Hostile Takeover of Our Country
Treasonous, noxious, thieving, tyrannical 
by Robert F. Kennedy Jr., for EcoWatch
from the foreword to Billionaires & Ballot Bandits
Friday, October 26, 2012

American democracy is under assault.

In one super-PAC alone, Karl Rove and the Enron grifter Ed Gillespie, have assembled $200 million from big polluters and Wall Street moguls to buy the 2012 election.

Two of the Koch Brothers, Charles and David, pledged $130 million to elect candidates who favor unrestrained corporate profiteering.

The senators and congressmen they fund and elect are not representing the United States—they are representing Koch and its oil industry cronies, Big Pharma, and the Wall Street banksters currently mounting a hostile takeover of our government.

I have no problem characterizing these corporate-centric super-PACs as treasonous.  We are now in a free fall toward old-fashioned oligarchy; noxious, thieving and tyrannical.

The most corporate-friendly Supreme Court since the Gilded Age had declared in its notorious Citizens United decision that corporations are people and that money is speech. Those who have the most money now have the loudest voices in our democracy while poor Americans are mute.

And the money is talking; in 97 percent of federal elections over the past two decades, the best-funded candidates were victorious.

 

America, the world’s proud template for democracy and a robust middle class, is now listing toward oligarchy and corporate kleptocracy.

America today is looking more and more like a colonial economy, with a system increasingly tilted toward enriching the wealthy 1 percent and serving the mercantile needs of multinational corporations with little allegiance to our country.

These radical forces already dominate the national press, with Fox News and talk radio snugly in the pocket of the corporate Right.

This is the first time in American history that corporate and media interests have been so clearly and so perilously aligned.

With the media in their hands, and unlimited money, the final strategy of Rove, Koch, the Chamber of Commerce, and others of that ilk is to permanently cripple representative democracy by stopping Americans from voting.

A boatload of new Jim Crow laws target Democrats by erecting impediments that deter poor and minority communities, senior citizens, and students from exercising their franchise.

Voter suppression is a crime.

In Billionaires & Ballot Bandits, Greg Palast details each of these devious scams for disenfranchising vulnerable voters . . . but also, crucially, Palast here follows the money that powers the machinery of democracy’s destruction.

This is not a partisan issue. Clearly the GOP agenda is to suppress votes, as Karl Rove has repeatedly and unashamedly signaled. But Billionaires & Ballot Bandits exposes the vote-count blindness, biases, venality, and ballot gaming by Democrats as well. I don’t believe there are Republican children or Democratic children.

Every American citizen ought to have the right to vote and everybody ought to have the right to clean air and clean water, to integrity and transparency in the marketplace, and to a functioning democracy.
 

Palast is the last of the great, old-fashioned muckraking investigative reporters. He’s an “outlier,” unafraid of corporate tyrants. Together, we have been investigating and exposing voter suppression for years. In 2008, we co-wrote a story for Rolling Stonewarning of the ugly future of a new Jim Crow operation.
Now, it's here.
 

Voter suppression is real. And it’s happening to YOU. But there is something that you can do to prevent it. That is the message of Palast’s book.

Remember, this is YOUR democracy. You can do all the campaigning you want, but if your vote isn’t counted, you’re going to lose the presidency—and our democracy.

Read our book Billionaires & Ballot Bandits. Pass on the link www.BallotBandits.org and download the 7 Ways to Beat the Ballot Bandits. And get the word out! There’s still time to steal back your vote..

Read Kennedy's entire A Hostile Takeover of our Country inBillionaires & Ballot Bandits: How to Steal and Election in 9 Easy Steps by Greg Palast. The New York Times bestseller includes a 48-page comic book insert by artist Ted Rall.

IMF's epic plan to dethrone bankers

IMF's epic plan to conjure away debt and dethrone bankers

So there is a magic wand after all. A revolutionary paper by the International Monetary Fund claims that one could eliminate the net public debt of the US at a stroke, and by implication do the same for Britain, Germany, Italy, or Japan.

The IMF reports says the conjuring trick is to replace our system of private bank-created money. Photo: Reuters

By Ambrose Evans-Pritchard

2:31PM BST 21 Oct 2012

, The Telegraph

One could slash private debt by 100pc of GDP, boost growth, stabilize prices, and dethrone bankers all at the same time. It could be done cleanly and painlessly, by legislative command, far more quickly than anybody imagined.

The conjuring trick is to replace our system of private bank-created money -- roughly 97pc of the money supply -- with state-created money. We return to the historical norm, before Charles II placed control of the money supply in private hands with the English Free Coinage Act of 1666.

Specifically, it means an assault on "fractional reserve banking". If lenders are forced to put up 100pc reserve backing for deposits, they lose the exorbitant privilege of creating money out of thin air.

The nation regains sovereign control over the money supply. There are no more banks runs, and fewer boom-bust credit cycles. Accounting legerdemain will do the rest. That at least is the argument.

Some readers may already have seen the IMF study, by Jaromir Benes and Michael Kumhof, which came out in August and has begun to acquire a cult following around the world.

Entitled "The Chicago Plan Revisited", it revives the scheme first put forward by professors Henry Simons and Irving Fisher in 1936 during the ferment of creative thinking in the late Depression.

Irving Fisher thought credit cycles led to an unhealthy concentration of wealth. He saw it with his own eyes in the early 1930s as creditors foreclosed on destitute farmers, seizing their land or buying it for a pittance at the bottom of the cycle.

The farmers found a way of defending themselves in the end. They muscled together at "one dollar auctions", buying each other's property back for almost nothing. Any carpet-bagger who tried to bid higher was beaten to a pulp.

Benes and Kumhof argue that credit-cycle trauma - caused by private money creation - dates deep into history and lies at the root of debt jubilees in the ancient religions of Mesopotian and the Middle East.

Harvest cycles led to systemic defaults thousands of years ago, with forfeiture of collateral, and concentration of wealth in the hands of lenders. These episodes were not just caused by weather, as long thought. They were amplified by the effects of credit.

The Athenian leader Solon implemented the first known Chicago Plan/New Deal in 599 BC to relieve farmers in hock to oligarchs enjoying private coinage. He cancelled debts, restituted lands seized by creditors, set floor-prices for commodities (much like Franklin Roosevelt), and consciously flooded the money supply with state-issued "debt-free" coinage.

The Romans sent a delegation to study Solon's reforms 150 years later and copied the ideas, setting up their own fiat money system under Lex Aternia in 454 BC.

It is a myth - innocently propagated by the great Adam Smith - that money developed as a commodity-based or gold-linked means of exchange. Gold was always highly valued, but that is another story. Metal-lovers often conflate the two issues.

Anthropological studies show that social fiat currencies began with the dawn of time. The Spartans banned gold coins, replacing them with iron disks of little intrinsic value. The early Romans used bronze tablets. Their worth was entirely determined by law - a doctrine made explicit by Aristotle in his Ethics - like the dollar, the euro, or sterling today.

Some argue that Rome began to lose its solidarity spirit when it allowed an oligarchy to develop a private silver-based coinage during the Punic Wars. Money slipped control of the Senate. You could call it Rome's shadow banking system. Evidence suggests that it became a machine for elite wealth accumulation.

Unchallenged sovereign or Papal control over currencies persisted through the Middle Ages until England broke the mould in 1666. Benes and Kumhof say this was the start of the boom-bust era.

One might equally say that this opened the way to England's agricultural revolution in the early 18th Century, the industrial revolution soon after, and the greatest economic and technological leap ever seen. But let us not quibble.

The original authors of the Chicago Plan were responding to the Great Depression. They believed it was possible to prevent the social havoc caused by wild swings from boom to bust, and to do so without crimping economic dynamism.

The benign side-effect of their proposals would be a switch from national debt to national surplus, as if by magic. "Because under the Chicago Plan banks have to borrow reserves from the treasury to fully back liabilities, the government acquires a very large asset vis-à-vis banks. Our analysis finds that the government is left with a much lower, in fact negative, net debt burden."

The IMF paper says total liabilities of the US financial system - including shadow banking - are about 200pc of GDP. The new reserve rule would create a windfall. This would be used for a "potentially a very large, buy-back of private debt", perhaps 100pc of GDP.

While Washington would issue much more fiat money, this would not be redeemable. It would be an equity of the commonwealth, not debt.

The key of the Chicago Plan was to separate the "monetary and credit functions" of the banking system. "The quantity of money and the quantity of credit would become completely independent of each other."

Private lenders would no longer be able to create new deposits "ex nihilo". New bank credit would have to be financed by retained earnings.

"The control of credit growth would become much more straightforward because banks would no longer be able, as they are today, to generate their own funding, deposits, in the act of lending, an extraordinary privilege that is not enjoyed by any other type of business," says the IMF paper.

"Rather, banks would become what many erroneously believe them to be today, pure intermediaries that depend on obtaining outside funding before being able to lend."

The US Federal Reserve would take real control over the money supply for the first time, making it easier to manage inflation. It was precisely for this reason that Milton Friedman called for 100pc reserve backing in 1967. Even the great free marketeer implicitly favoured a clamp-down on private money.

The switch would engender a 10pc boost to long-arm economic output. "None of these benefits come at the expense of diminishing the core useful functions of a private financial system."

Simons and Fisher were flying blind in the 1930s. They lacked the modern instruments needed to crunch the numbers, so the IMF team has now done it for them -- using the `DSGE' stochastic model now de rigueur in high economics, loved and hated in equal measure.

The finding is startling. Simons and Fisher understated their claims. It is perhaps possible to confront the banking plutocracy head without endangering the economy.

Benes and Kumhof make large claims. They leave me baffled, to be honest. Readers who want the technical details can make their own judgement by studying the text here.

The IMF duo have supporters. Professor Richard Werner from Southampton University - who coined the term quantitative easing (QE) in the 1990s -- testified to Britain's Vickers Commission that a switch to state-money would have major welfare gains. He was backed by the campaign group Positive Money and the New Economics Foundation.

The theory also has strong critics. Tim Congdon from International Monetary Research says banks are in a sense already being forced to increase reserves by EU rules, Basel III rules, and gold-plated variants in the UK. The effect has been to choke lending to the private sector.

He argues that is the chief reason why the world economy remains stuck in near-slump, and why central banks are having to cushion the shock with QE.

"If you enacted this plan, it would devastate bank profits and cause a massive deflationary disaster. There would have to do `QE squared' to offset it," he said.

The result would be a huge shift in bank balance sheets from private lending to government securities. This happened during World War Two, but that was the anomalous cost of defeating Fascism.

To do this on a permanent basis in peace-time would be to change in the nature of western capitalism. "People wouldn't be able to get money from banks. There would be huge damage to the efficiency of the economy," he said.

Arguably, it would smother freedom and enthrone a Leviathan state. It might be even more irksome in the long run than rule by bankers.

Personally, I am a long way from reaching an conclusion in this extraordinary debate. Let it run, and let us all fight until we flush out the arguments.

One thing is sure. The City of London will have great trouble earning its keep if any variant of the Chicago Plan ever gains wide support.

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Money black hole: in search of hidden seigniorage....

A money 'black hole': rich hide at least $21 trillion in tax havens, study shows

By F. Brinley Bruton, NBC News

Thanks to lax international tax rules the world’s super rich have siphoned at least $21 trillion -- more than 50 percent larger than the entire U.S. economy -- into secretive tax-free havens, according to a study by UK campaign group Tax Justice Network.

The report by James Henry, a former chief economist at international consultancy McKinsey & Co., shows how with the help of private banks the money has flowed into countries such as Switzerland and the Cayman Islands.

“We’re basically talking about a black hole in the world economy,” Henry told NBCNews.com.  

The figure of $21 trillion in off-shore funds is conservative and the true sum could be as high as $32 trillion, Henry said.

According to the study, the world’s top 50 private banks managed more than $12.3 trillion in 2010 in off-shore financial assets, up from $7.5 trillion five years earlier.The figure of $21 trillion in off-shore funds is conservative and the true sum could be as high as $32 trillion, Henry said.

In 2010, the world’s top 10 financial institutions -- which today include the U.S.’s Goldman Sachs and JPMorganChase, as well as Switzerland’s UBS and Credit Suisse --  controlled about half of this amount. At least seven of these top 10 institutions received huge bailouts in the wake of the financial crisis, Henry said. 

“This isn’t a bunch of shady third-world banks -- these are some of the premier institutions in the world,” Henry said. “JP Morgan, Citibank, Barclays, UBS -- the top 10 to 20 banks these are some of the ones who received most of the financial bailout, who were involved in the mortgage fiasco, the Libor rates scandal.”

“Now we find out that they have been spending a lot of time helping very wealthy people avoid taxes,” he added.

Indeed, the report comes at a troubling time for a banking industry reeling from a multi-country probe into the manipulation of global benchmark rates. Last month, British bank Barclays agreed to pay a $453 million fine to settle a U.S.-British probe into the rigging of the interest rate known as the London interbank offered rate, or Libor, that affects debt from student loans to mortgages.

That follows years of international turbulence and huge bailouts sparked by the subprime lending crisis in the United States.

While many of the tax-avoiding rich hail from developed countries in Europe and North America, the newly wealthy in developing countries, such as China and India, have siphoned off enough in the last 40 years to pay off their countries' respective debts, Henry said.

Growing anger at tax evasionThe report -- based on information from the Bank of International Settlements, International Monetary Fund, World Bank, and national governments -- comes amid growing international concern and anger about tax evasion. It is especially poignant as many countries are struggling under harsh austerity programs to reduce their debt burdens.

The issue jumped into the headlines earlier in July when a United States Senate report said that a "pervasively polluted" culture at global bank HSBC -- also named in the study -- helped clients move shadowy funds from the world's most dangerous and secretive corners, including Mexico, Iran, Saudi Arabia and Syria.

The failings and lax controls inside HSBC included an inability to properly monitor $15 billion in bulk cash transactions between mid-2006 and mid-2009, inadequate staffing and high turnover in the bank's compliance units, the Senate report said.

British tax expert John Whiting said he was skeptical that the amount being squirreled away by the very rich was quite large as the study claimed.

“As much as anything -- I have no alternative evidence -- the figures just seem so large,” said Whiting, who is tax policy director at the Chartered Institution of Taxation.

But whatever the exact figures, he said the issues raised in the report are real and deserve to be addressed.

“I’m not denying that this is a problem, it’s just the size of it,” he added. “What is happening with all this money?”

So while experts may disagree on the exact numbers, the study sheds light not only on how the murky world of off-shore tax havens, and the growing disparity between the super-rich and everybody else.

This sort of disparity can create popular resentment and eventually unrest, according to Paul De Grauwe, a prominent economist and professor at the London School of Economics.

“Fairness is essential to provide the glue to any system,” he told NBC News.com.  “It is important to take out these excesses … people will always try to evade taxes (but) when this has taken on proportions that we’ve seen today you can get violent reactions.”

In other words, while evasion and other similar schemes have likely been employed since governments first began levying taxes, the practices exposed in Henry’s report are likely to spark popular resentment given the austerity and crisis that many countries around the world are enduring.

“On one hand people are asked to cut their wages and live in poverty because banks have to be saved,” De Grauwe said.  “And these same banks use all sorts of tech to help superrich to evade taxes.” 

Glimpse into Illuminati Sex Practices

Glimpse into Illuminati Sex Practices

 at 02:01 Posted by Vatic Master

http://vaticproject.blogspot.it/2012/10/glimpse-into-illuminati-sex-practices.html

Vatic Note:  This speaks for itself.  Its illuminating to say the least.  Read it and see if you do not agree.

Glimpse into Illuminati Sex Practices

"The investigation into the prostitution ring in Lille ultimately swept up 10 suspects, including [former IMF Chief] Mr. Strauss-Kahn. They knew each other largely through their membership as French Freemasons."  

Sex Life Was 'Out of Step,' Strauss-Kahn Says, but Not Illegal

By DOREEN CARVAJAL and MAÏA de la BAUME

(New York Times, abridged by henrymakow.com) 

                                                                         

PARIS -- More than a year after resigning in disgrace as the managing director of the Internatitsonal Monetary Fund, Dominique Strauss-Kahn is pursuing a uniquely French legal defense to settle a criminal inquiry that exposed his hidden life as a libertine.

Mr. Strauss-Kahn, 63, a silver-haired economist, is seeking to throw out criminal charges in an inquiry into ties to a prostitution ring in northern France with the legal argument that the authorities are unfairly trying to "criminalize lust."

That defense and the investigation, which is facing a critical judicial hearing in late November, have offered a keyhole view into a clandestine practice in certain powerful circles of French society: secret soirees with lawyers, judges, police officials, journalists and musicians that start with a fine meal and end with naked guests and public sex with multiple partners.

In France, "Libertinage" has a long history in the culture, dating from a 16th-century religious sect of libertines. But the most perplexing question in the Strauss-Kahn affair is how a career politician with ambition to lead one of Europe's most powerful nations was blinded to the possibility that his zest for sex parties could present a liability, or risk blackmail.

The exclusive orgies called "parties fies" -- lavish Champagne affairs costing around $13,000 each -- were organized as a roving international circuit from Paris to Washington by businessmen seeking to ingratiate themselves with Mr. Strauss-Kahn. Some of that money, according to a lawyer for the main host, ultimately paid for prostitutes because of a shortage of women at the mixed soirees orchestrated largely for the benefit of Mr. Strauss-Kahn, who sometimes sought sex with three or four women.

On Thursday, Mr. Strauss-Kahn broke a long silence to acknowledge that perhaps his double life as an unrestrained libertine was a little outré.

"I long thought that I could lead my life as I wanted," he said in an interview with the French magazine Le Point. "And that includes free behavior between consenting adults. There are numerous parties that exist like this in Paris, and you would be surprised to encounter certain people. I was naïve."

"I was too out of step with French society," he added. "I was wrong."

ORGIES

Mr. Strauss-Kahn's name first surfaced in the French inquiry by chance, in May 2011. French investigators were tapping the telephones of Dominique Alderweireld, an owner of Belgian sex clubs who is also a suspect in the prostitution ring.

In one conversation between Mr. Alderweireld and a longtime childhood friend, René Kojfer, who worked at the Carlton Hotel in Lille, the men were gossiping about Mr. Strauss-Kahn's recent New York arrest, according to lawyers involved in the case.

They then recalled a freewheeling luncheon in 2009 at a Paris restaurant called L'Aventure, and Mr. Kojfer discussed whether they could make money by offering information about that day to Ms. Diallo's lawyer, Mr. Thompson, who was never called, the lawyers said.

At L'Aventure, Mr. Strauss-Kahn and a few friends gathered in a private basement club, carpeted in purple and black tiger stripes, with a female Belgian escort and Mr. Alderweireld's companion, Béatrice Legrain, who recalled that lunch in an interview.

She said that Mr. Strauss-Kahn, energized by Viagra, had sex with the escort and then followed Ms. Legrain to the bathroom, grabbing her and demanding sex. But she said she rebuffed him and it "wasn't a big deal." Mr. Strauss-Kahn's lawyer declined to comment.

In his own interview, Mr. Alderweireld made light of the "petit" episode at L'Aventure. His lawyer, Sorin Margulis, took a more scornful view: "It's more an act of Louis XIV."

FREEMASONRY

The investigation into the prostitution ring in Lille ultimately swept up 10 suspects, including Mr. Strauss-Kahn. They knew each other largely through their membership as French Freemasons, according to Karl Vandamme, a defense lawyer who represents Fabrice Paszkowski, the owner of a medical supply company who played a crucial role in organizing the sex parties.

"Libertines are people like you and me: people who have a normal life," said Mr. Vandamme, who said his client invested around $65,000 in party expenses, betting on the political rise of Mr. Strauss-Kahn.

The banker, he said, would typically arrive late for the more than a dozen parties, held over a period of about five years. There was a rhythm to the gatherings, with everyone dressed for a sit-down dinner, he said. Then over time, couples separated, "kisses were exchanged between one woman and another and between a husband and the wife of a friend" until the guests "all ended up nude."

Mr. Strauss-Kahn's double life is not surprising to some Parisians.

"He's not the only libertine man in the political world," said Olivia Cattan, who leads an anti-sexism association called Words of Women and believes the case reflects a code of silence. "It is linked to power, and women are often complicit when it can guarantee them a job."

--

Thanks to Mike for this. 

Related-- Freemasons Regarded as Fifth Column in France 

La deuda europea es imposible

"La deuda europea es imposible de pagar"

¿Quién manda en el mundo? Juan Torres, economista crítico y uno de los dos autores -junto a Vicenç Navarro- de 'Los amos del mundo. Las armas del terrorismo financiero' (Espasa) lo tiene claro: los grandes grupos financieros, los lobbys, los grandes inversores, las grandes fortunas y, en los últimos tiempos, "los acreedores, que son los que han impuesto sobre los demás una esclavitud en forma de deuda".

Ana Requena Aguilar  - El Diario - Madrid

16/10/2012 - 20:43h

El economista Juan Torres.

La idea principal del libro es que la democracia ha claudicado ante los poderes financieros o, al menos, que estos le han ganado la batalla a la política...

El mundo financiero ha ido consolidando unos privilegios tan grandes que hoy ya tiene un poder que le permite actuar como si fueran los amos del mundo y de esa manera se sobreponen a cualquier otro tipo de poder. Se están desmantelando las democracias en un sitio como Europa, que siempre habíamos considerado la cuna de la democracia. Lo que tratamos de explicar es que es el resultado, sobre todo, de un privilegio principal que es el que tienen los bancos de crear dinero fabricando deuda. Ese privilegio es responsable de todas las cosas que están pasando.

Entonces, ¿estamos dejando de ser una democracia?

Estamos lejos de ser una dictadura en el sentido formal del término, pero es verdad que la realidad de hoy día muestra que la ciudadanía no puede tomar las decisiones que quisiera en el ámbito económico y que estas decisiones no son el reflejo de lo que la ciudadanía quiere. Asistimos a la quiebra y a la negación explícita de principios que siempre habíamos considerado consustanciales a la democracia. Por ejemplo, los principios del mecanismo europeo de estabilidad (MEDE), que tiene un enorme poder, se basan en la falta de transparencia, de control, de participación, de falta de sometimiento a la soberanía popular, algo absolutamente incompatible con la definición más elemental de democracia. Eso no quiere decir que esto sea una dictadura, mantenemos libertades formales -de expresión, de reunión, de manifestación-, aunque incluso éstas comienzan a quebrarse poco a poco.

Cada vez más voces hablan de que la deuda de España es ilegítima o que al menos podría serlo una parte, ¿está de acuerdo?

Si partimos de la idea de que la deuda ilegítima es la que es impuesta a los pueblos sin que sea el resultado de una decisión soberana, entonces sí, podríamos hablar de deuda odiosa. Por ejemplo, gran parte de la deuda que tenemos en España y Europa procede de la presión que han hecho los bancos privados para que el BCE no sea un auténtico banco central. Hemos calculado que si desde 1989 hasta 2011, la deuda primaria del estado se hubiera financiado con un banco central al 1%, la deuda que tendría España ahora sería del 14% del PIB y no del 90%. Eso significa que tenemos una deuda acumulada que es el resultado de una opción que se ha impuesto y sobre la cual los ciudadanos no hemos tenido libertad de pronunciarnos. Incluso cuando en algún país han dicho que no a los tratados europeos se han conseguido aprobarlos con mil trampas.

También la deuda que es resultado de manipulaciones de los inversores especulativos en los mercados financieros se podría considerar ilegítima. Lo que está claro es que la mayor parte de la deuda que tienen los países de la periferia europea se debe a políticas impuestas, que no son deseables, porque benefician muy directamente solo al grupo de población que ha tenido poder para imponerlas, luego desde ese punto de vista podríamos tener derecho a decir que no debe pagarse.

Pero, ¿es viable que se reconozca como ilegítima nuestra deuda?, ¿cómo sería ese proceso?

En primer lugar hay que evaluar la deuda, saber de dónde viene. En 2008, 2009 y 2010 España se ha endeudado del orden de 122.000 millones de euros para pagar deuda, es decir, deuda para pagar deuda que venía de operaciones especulativas, de un auténtico terrorismo financiero. ¿Es legítimo que nos hayamos tenido que endeudar porque no se han querido regular los mecanismos financieros? Habrá una parte de la deuda que sea claramente ilegítima, otra parte que podamos considerar como resultado de un mal modelo de crecimiento que, al fin y al, cabo hemos asumido, y luego habrá que valorar su pago. 

Cuando en los últimos años se han declarado deudas ilegítimas, por ejemplo, que EEUU ha reconocido a otros países ha sido porque quería apoyar a esos Estados. Es una decisión muy discrecional, política. En cualquier caso, es un tema que antes o después habrá que poner sobre la mesa, porque la deuda europea es materialmente imposible de pagar. Por lo tanto, habrá que hablar de posibles reestructuraciones de la deuda, de quitas o de otras medidas. Incluso quitando en medio la parte de deuda odiosa, ni el resto se podría pagar. Ni Alemania podría pagar la deuda que tiene acumulada, sólo puede ir financiándola poco a poco  y, sobre todo, a cuenta de que aumente nuestra prima de riesgo. Tampoco EEUU podrá pagar nunca la deuda que tiene. 

¿Cuáles serían las consecuencias de no pagar la deuda o de hacer una quita?

Que habría acreedores que pondría el grito en el cielo y que tendrían que sentarse con esos estados para negociar. Esos acreedores tienen mucho poder y presionarían a las autoridades políticas, a los organismos internacionales y habría amenazas de todo tipo. Esa es una decisión nacional, soberana, que se podría tomar y que sería exitosa en la medida en que tuviera un apoyo social importante, no sólo dentro de ese país, sino en otros.

Si lo que le queda a España dentro del euro es un camino que va a llevar a perder renta, a desindustrializarse definitivamente, a perder la actividad productiva y a una ruina económica sin parangón, a lo mejor hay que plantearse estar fuera del euro, protegerse y generar espacios de convergencia con otros países.

¿Y cómo se financiaría España entonces, si probablemente no podría acudir a los mercados internacionales?

Un planteamiento de impago o de restructuración de la deuda no puede considerarse aislado, tiene que ir acompañado de otras medidas: de un plan de regeneración económica, de nuevos mecanismos de financiación de la economía, que no son fáciles, porque no te van a financiar desde fuera... Pero hay posibilidades en ese sentido: una reforma fiscal que grave a la población más rica, una reforma del sistema bancario, la creación de cajas de depósitos...

¿Todo eso se podría hacer sin salir del euro?

Sí, perfectamente. Además, Alemania no nos va a echar nunca del euro, ni a Grecia tampoco, porque es la principal beneficiaria de nuestra presencia. Alemania se opondrá con toda su fuerza mientras esté gobernada por grupos representantes del capital financiero a que haya una nueva articulación política y financiera de Europa. Lo que hay que hacer es empezar a plantear que así no, y que si esto sigue así quizá España debería estar en otro sitio.

¿Dónde?

Si lo que le queda a España dentro del euro es un camino que va a llevar a perder renta, a desindustrializarse definitivamente, a perder la actividad productiva y a una ruina económica sin parangón, a lo mejor hay que plantearse estar fuera del euro, protegerse y generar espacios de convergencia con otros países. A lo mejor la solución es un espacio formado por los países mediterráneos. Lo que dice Europa no tiene por qué ir a mesa. Hay que adoptar una postura más beligerante.

Pues el rescate total de España parece inminente...

Está claro que no lo quieren hacer antes de las elecciones. Por otro lado, están definiendo de qué cantidad va a tratarse. Lo que seguramente ocurra es que sea una cantidad muy grande pero no suficiente para resolver el problema que hay y eso va a traer complicaciones. Las medidas que se van a imponer van a ser draconianas, porque ya llevamos más de año y medio tomando medidas extremas y que hemos visto que no funcionan. No ha habido ningún caso en la historia donde con estas políticas se haya resuelto un problema parecido.

En el libro sois tajantes y vinculáis recortes con un aumento de la mortalidad...

Las políticas de ajuste matan. Lo hemos visto en América Latina, en Asia, en África y ya lo estamos viendo aquí. En Portugal, la tasa de mortalidad ha aumentado un 20%, los suicidios un 40%. Sabemos por estudios empíricos que el recorte de determinadas cantidades en asistencia sanitaria y de cuidados produce más enfermedad y más muertes. Eso es lo que ya está viniendo. Los gobiernos deberían explicárselo a la gente, y deberían tener la obligación de evaluar ese impacto antes incluso de tomar esas medidas.

Critican también la obsesión neoliberal por la inflación, ¿qué le parece entonces el papel que ha tenido el BCE en los últimos años?

Desde los años 80, se postula que la inflación es el objetivo principal de la política económica y a los bancos centrales se les encomienda como único objetivo combatirla. Lo que no se dice es a qué va a asociado eso: se dice que la inflación está producida por la presión salarial y que la inflación es un problema monetario. En su lógica, si la presión salarial es lo que origina la inflación, lo que hay que hacer es políticas de restricción salarial. Y si es un problema monetario hay que encargar al banco central, como autoridad independiente de la soberanía popular, adoptar medidas para mantener tipos de interés elevados. Son las dos medidas que se han tomado estos años y que casualmente hacen aumentar extraordinariamente la desigualdad y el beneficio de los capitales. A eso es a lo que se está dedicando el BCE. Constantemente está amenazando con el peligro de inflación, por una parte para contener los salarios -que es la manera de aumentar las rentas del capital- y, por otro, para mantener una lógica monetaria que va a en detrimento de la financiación pública y del estado para darle más libertad al sistema bancario privado. Los riesgos: el desempleo, el trabajo precario, la falta de actividad y de iniciativa empresarial...

¿El impuesto a las transacciones financieras que han anunciado once países europeos (en principio, será del 0,1% a las operaciones con acciones y bonos y del 0,01% las operaciones con derivados) le parece suficiente?

Hay que felicitarse, llevamos años reclamándolo, aunque aún es un canto de sirena: ni se sabe exactamente qué va a ser ni el alcance que va a tener ni cómo se va a instrumentalizar, aunque es positivo porque demuestra que las medidas que los economistas críticos llevamos veinte años planteando son necesarias. Hay que mejorarlo y generalizarlo, esa no es la solución a todo, pero son mecanismos imprescindibles.  

¿Cuál es su balance de la reforma laboral aprobada por el Gobierno en febrero?

Todavía es pronto, pero ya estamos viendo que el efecto perverso de la reforma laboral, que básicamente consiste en facilitar despidos, abaratarlos y reducir la capacidad de negociación de los trabajadores, es que se está perdiendo empleo. Y como los problemas de creación de empleo no se resuelven facilitando los despidos sino mejorando el mercado de bienes y servicios y la financiación, esta reforma no consigue nada más que desempleo y facilitarle las cosas a las grandes empresas y los grandes bancos.

¿Qué le parece el papel que patronal y sindicatos han jugado durante la crisis?

Las patronales de este país son las grandes enemigas de los empresarios. Son patronales muy ideologizadas que no contemplan la realidad de las cosas, dominadas por las grandes empresas, que tienen una naturaleza y una problemática muy distinta a la de las auténticas empresas que están creando empleo, que son las que día a día se parten el pecho. Por tanto, las patronales están destruyendo empresas porque apoyan políticas contrarias a las condiciones que permiten que los empresarios creen empleo y tengan beneficios. 

En cuanto a los sindicatos, creo que hacen lo que pueden, son organismos de defensa. Están siendo atacados constantemente en los últimos años, así que tienden a actuar a la defensiva y eso hace que ganen pocos partidos. Por eso la gente tiende a pensar que son poco útiles, pero habría que preguntarse qué habría ocurrido si este partido no lo hubieran jugado los sindicatos. Entiendo que hay otra manera de que puedan jugar a la ofensiva y ganar partidos: que tengan más afiliación, y no las más baja de Europa, que los trabajadores se movilicen, que apoyen las manifestaciones, las llamadas de los sindicatos, que se organicen y que los trabajadores sean menos conservadores. Estamos pidiendo a los sindicatos lo que quizá tendríamos que pedir a las clases trabajadores, cuyo conservadurismo se ha trasladado a veces a las direcciones de los sindicatos. Un sindicato es lo que es la clase trabajadora de un país, y una clase trabajadora bastante desmovilizada, conservadora, y atemorizada por el paro, necesariamente crea sindicatos que reproducen eso.