The Winners & Losers in Bryza Case

By Harut Sassounian

As a result of successive political blunders by the Obama administration, Matthew Bryza was forced to abandon his ambassadorial post in Azerbaijan last week.

President Obama ignored repeated warnings that the candidate he was nominating as Ambassador to Azerbaijan in May 2010 had serious flaws. Members of the Senate Foreign Relations Committee accused Bryza of having a pro-Azerbaijani bias and questionable ties to Azeri officials. The Senators were troubled by reports that foreign officials had given Bryza lavish gifts at his Istanbul wedding, during which the Foreign Minister of Azerbaijan had served as a groomsman. In addition, the nominee’s Turkish-born wife Zeyno Baran was accused of conflicts of interest while working on Caspian energy issues at a Washington think tank. She had also antagonized the Armenian-American community by testifying against recognition of the Armenian Genocide at a Senate Subcommittee hearing.

When Pres. Obama failed to take these concerns seriously, Senators Barbara Boxer (Dem.-CA) and Robert Menendez (Dem.-New Jersey) had no choice but to place a hold on Bryza’s nomination, effectively blocking his confirmation. Obama then compounded his error by appointing Bryza as Ambassador to Azerbaijan in late 2010 without Senate approval. The President seemed oblivious to the potential damage to his own reputation, the prestige of the United States, and U.S.-Azeri relations, should the Senate not confirm Bryza’s nomination, forcing him to leave his post and return to Washington upon expiration of his 12-month appointment. Read more È

Let’s See Who is Watching DHS Mega Fusion Center

Yesterday I came across an article on DHS plans to create its own internal fusion center so that its many agencies can aggregate the data they have and make it searchable from a central location. Let’s read a few excerpts from this typical half-hearted MSM attempt to provide a semi-complete picture of the state of ‘things’ when it comes to our government:

Information sharing (or lack thereof) between intelligence agencies has been a sensitive topic in the U.S. After 9/11, there was a push to create fusion centers so that local, state, and federal agencies could share intelligence, allowing the FBI, for example, to see if the local police have anything in their files on a particular individual. Now the Department of Homeland Security wants to create its own internal fusion center so that its many agencies can aggregate the data they have and make it searchable from a central location…

Of course this is another troubling development in an extremely troubling state of ‘things.’ However, this wasn’t the focus my attention. Here comes the not-really-reported angle in this half-covered story [All emphasis mine]:

The DHS is calling it a “Federated Information Sharing System� and asked its privacy advisory committee to weigh in on the repercussions at a public meeting in D.C. last month…

So what is this ‘privacy advisory committee’ and who are its members? This is what the article provides on that front: Read more È

The Boiling Frogs Presents Roberto Gonzalez

This is part III of our interview series based on the recently released book -The CIA on Campus: Essays on Academic Freedom and the National Security State, edited by Dr. Philip Zwerling.

Professor Roberto Gonzalez joins us to discuss the high school “Spy Camp� program as part of a pilot grant from the US Office of Director of National Intelligence (DNI) to create an “Intelligence Community Center of Academic Excellence� (IC Center) with the goal to increase the pool of future applicants for careers in the US intelligence community such as the CIA, FBI and DIA. He explains the intentions behind the program being consciously directed at schools in low income regions and where minority students are the majority. Dr. Gonzalez talks about the ethical implications of involving universities with intelligence agencies like CIA, intellectual and moral dilemmas caused by militarized culture, the highly troubling cloak of secrecy surrounding scholarships provided to target students, the impact of funding and grants on university and college educators and administrators and more!

Roberto J. Gonzalez is an associate professor of anthropology at San Jose State University whose work focuses upon the relationship between humans and their environment; science, technology, and society; militarism and culture; and anthropological ethics. He has published four books: Zapotec Science: Farming and Food in the Northern Sierra of Oaxaca, Anthropologists in the Public Sphere: Speaking Out on War, Peace, and American Power, American Counterinsurgency: Human Science and the Human Terrain, and Militarizing Culture: Essays on the Warfare State.

Here is our guest Professor Roberto Gonzalez unplugged!

This site depends exclusively on readers’ support. Please help us continue by subscribing .

The Boiling Frogs Presents Stephen Soldz

This is part II of our interview series based on the recently released book -The CIA on Campus: Essays on Academic Freedom and the National Security State, edited by Dr. Philip Zwerling.

Professor Stephen Soldz joins us to discuss the central role played by psychologists in the design and implementation of the US torture program, and how the American Psychological Association (APA) has protected this involvement by issuing the highly biased 2005 Report of the Presidential Task Force on Psychological Ethics and National Security (the PENS Report). He points out the inherent bias in the Presidential Task Force membership, and cites other significant conflicts of interest by the Task Force’s unacknowledged participants. Dr. Soldz talks about the coalition of leading scholars and human rights groups from a range of fields who have joined together in spearheading a broad-based effort to annul and delegitimize the PENS Report as part of their joint effort to remove psychologists from torture and abusive interrogations.

Professor Stephen Soldz is a psychologist, psychoanalyst, and public health researcher in Boston, and was a co-author of PHR’s report Experiments in Torture. He is the Director of the Center for Research, Evaluation, and Program Development at the Boston Graduate School of Psychoanalysis. He was Adjunct Assistant Professor of Psychology (Psychiatry) at Harvard Medical School, and has taught at the University of Massachusetts Boston, Boston College, and Boston University. For more information visit the website of the Coalition for an Ethical Psychology here.

Here is our guest Stephen Soldz unplugged!

This site depends exclusively on readers’ support. Please help us continue by subscribing .

The GAO Fed Audit(s):  Some Missing Links?

The Dodd-Frank financial reform legislation passed in 2010 directed the Government Accountability Office (GAO) to conduct two audits of Federal Reserve operations.  The GAO issued a report in July on the first audit, which dealt with the Federal Reserve’s emergency lending facilities developed in the 2007-2010 financial crisis.  The second audit includes a broader examination of Federal Reserve Bank governance practices, and the GAO is expected to issue this report in October.

In calling for the GAO to audit the Fed’s emergency lending facilities, Dodd-Frank included provisions directing the GAO to assess, in part, ‘the effectiveness of the security and collateral policies established for the facility in mitigating risk to the relevant Federal Reserve bank and taxpayers,’ and ‘whether there were conflicts of interest with respect to the manner in which such facility was established or operated.’  The GAO produced a long and thoroughly-detailed report discussing these and other elements, but some questions remain.  The GAO’s report on its first audit is available here. 

Three topics relating to these two directives for GAO audits that could have benefited from more complete discussion include the identity of the borrowers under the Fed’s emergency lending programs, the role of credit ratings in the security and collateral policies for those programs, and how the Fed’s previous reliance on credit ratings and the Fed’s role in interbank payment systems mattered for the conflict of interest question.

Who Got the Funding? 

On pages 131-133 of their report, the GAO provided two tables listing the largest borrowing institutions under the emergency programs.  They are ranked in the first table by the total borrowed amount irrespective of maturity length, and in the second table adjusting for the term of the borrowing. Some loans were for relatively brief intervals, even overnight, and others for longer time frames.  Both perspectives are valuable, but the amounts adjusted for borrowing terms tend to do a better job of capturing a comparable read on the simple magnitude of lending.  Total borrowing on this basis totaled $1.1 trillion, according to the GAO’s “Table 9,� while two-thirds of the 15 largest institutions listed were from outside the United States.

On page 132, Table 9, titled “Institutions With the Largest Term-Adjusted Borrowing across Broad-Based Emergency Programs,â€� listed 20 specific ‘institutions,’ while the table continued on to page 133 with one more line item before the totals.  The largest single identified borrower was the Bank of America with $67 billion, ranging down to $15 billion for the smallest identified institution on the list of 20 (Norinchukin Bank, in Japan).   The 21^st line item may well be a matter of importance, however.  It was simply titled ‘All Other Borrowers,’ coming in at a total of $537 billion — over one-half a trillion dollars, and 8 times as much as the largest single institution. 

The table’s overall title referred to ‘Institutions,’ but the Fed’s emergency lending in the crisis was undertaken under Federal Reserve Act provisions that include authority for the Fed to lend to ‘individuals, partnerships, or corporations’ (e.g. nonbanks) in ‘exigent and unusual circumstances.’  Read more È

Fed Governance – Accountable Independence, or a Spider’s Web?

On the heels of the worst financial crisis since the Great Depression, financial reform legislation passed last year directed the Congress’ General Accountability Office (GAO) to examine Fed emergency lending in the crisis, and also to review the Fed’s governance.  Last month, the GAO issued its first report.  This report documented how the Fed extended over $1 trillion of various forms of emergency lending, and politely identified room for improvement in management procedures administering this kind of aid in the future.  The second report, with broader implications for the future of our central bank, will likely be issued in October. 

To help set the stage for that second report, here’s a review of the basic framework for Federal Reserve governance, and a brief introduction to some of the topics relevant for that second report:

The Federal Reserve System, “the Fed,� has a lot of moving, interconnected parts.  The two basic components are the Federal Reserve Board of Governors, and the collection of 12 Federal Reserve Banks.  In turn, the Federal Open Market Committee (FOMC) melds those two parts to make the Fed’s main monetary policymaking body.

The Board of Governors is a government agency, an independent regulatory commission like the SEC.  The Board has 7 seats which are (normally) filled by Presidential appointment, subject to Senate confirmation.  (Two of those seats have been vacant for some time.)  The Board appointments are for 14 year terms, and they are ‘staggered’ (the individual terms do not coincide with one another).  The long, staggered terms are asserted to promote a valuable independence from nearsighted political influence.  By law, one of those seven members is appointed by the President to serve as Chairman.  Ben Bernanke was first appointed to that post in 2006 by George Bush, and he was reappointed to that role by President Obama in 2010. 

The Board of Governors is primarily a policymaking and oversight body, while the day-to-day operations, supervisory and examination roles, and economic reconnaissance are the main province of the 12 Reserve Banks around the country.  The banks are separately chartered government corporations.  The Federal Reserve Act stipulates that they are to be “conducted under the supervision and control of a board of directors.� But Reserve Bank operations are also subject to supervision and regulation from the Board of Governors and Congressional oversight lies behind the scenes as well, at least in theory.  In another melding of authority, Federal Reserve supervisory authority for private financial institutions is rooted in the Board of Governors, but much of that authority is delegated by the Board of Governors to the Reserve banks, with the Board retaining oversight authority after that delegation.

Each of the 12 Reserve Banks is led by a president, whose appointment by the Reserve Banks’ board of directors is subject to the approval of the Board of Governors in Washington.  Each of the 12 Reserve Banks is governed by their own board of directors, with the boards holding 9 members grouped in three classes.  The 3 Class A directors in each Reserve Bank board are elected by member banks in the district, and ‘represent’ those member banks.  The three Class B directors are also elected by member banks, but ‘represent’ the public, at least in theory.  The three Class C directors are appointed by the Federal Reserve Board of Governors, and they ‘represent’ the public as well.  Read more È

A Caucus to Combat Terrorism, Domestic Violence, Divorce & Job Dissatisfaction via ‘Happiness Pill’

According to our inside sources a new Bipartisan Congressional Caucus for Prozac will be launched before the end of the 112^th Congress. The primary purpose of the Prozac Caucus will be to raise awareness and advocate for this ‘miracle drug’ aka ‘happiness pill,’ on the grounds of combating homegrown terrorism and domestic violence, lowering the national divorce rate, and increasing the level of general job satisfaction among the restless American workforce. “Increasing the level of general satisfaction and happiness, while decreasing the effects of violence and despair inducing factors such as anxiety and depression, are the major keys to achieving long term national security, family unity, and work force stability. With Prozac we believe we can achieve all that and more,� said a congressional aide who wished to remain anonymous. The caucus will have an interactive website with easy-to-print promotional materials and a password protected section for physicians titled ‘Patriotic Physicians for a Secure America.’

Let’s start with what is a congressional caucus, or at least what it is supposed to be, in theory that is. A congressional caucus is a coalition of House and Senate members who meet to discuss specific legislative priorities and policy issues. Caucuses ‘supposedly’ allow members to discuss issues to determine their positions and make sure their votes are informed. They can also give ‘advocates’ a chance for a group of legislators to champion their cause on the Hill. You may go ahead and change ‘advocates’ to ‘lobby and you’ll be even more on target.

When we look at the long list of these caucuses, a list that initially had only a few but seems to lately  have taken off rapidly, we see some caucuses that seem rather ‘ordinary and expected;’ for example,  Children’s Environmental Health Caucus or Congressional Dairy Farmers Caucus. We also see some ‘amusing’ ones, such as Congressional Bike Caucus, Congressional Soccer Caucus, and Congressional Boating Caucus.

You follow me so far? Okay, then there are more than a few caucuses that are ‘confusing:’ Democratic Israel Working Group, Congressional Israel Allies Caucus, Congressional Friends of Jordan Caucus, and other ones for Turkey, Jordan, etc.  Why do I say ‘confusing’? Well, in the above paragraph we outlined the caucus definition, which includes ‘giving advocates, aka lobbies, a chance to influence, aka lobby, their cause through the members of their caucus. In this case, the advocates, aka lobbies, are foreign, and this means ‘direct foreign influence,’ and that in turn would make the representatives in these caucuses who then influence and lobby the rest of the Congress ‘foreign agents.’ Think of it as two-tiered foreign lobbies: Read more È