Wednesday, July 30, 2014

A Gaza Message and Response

I came across this powerful message and response 
at David Byrne's blog via Twitter.

Ed note: I received this email last Friday morning from my friend, Brian Eno. I shared it with my office and we all felt a great responsibility to publish Brian's heavy, worthy note. In response, Brian's friend, Peter Schwartz, replied with an eye-opening historical explanation of how we got here. What's clear is that no one has the moral high ground. 

Dear All of You:

I sense I'm breaking an unspoken rule with this letter, but I can't keep quiet any more.

Today I saw a picture of a weeping Palestinian man holding a plastic carrier bag of meat. It was his son. He'd been shredded (the hospital's word) by an Israeli missile attack - apparently using their fab new weapon, flechette bombs. You probably know what those are - hundreds of small steel darts packed around explosive which tear the flesh off humans. The boy was Mohammed Khalaf al-Nawasra. He was 4 years old.

I suddenly found myself thinking that it could have been one of my kids in that bag, and that thought upset me more than anything has for a long time.

Then I read that the UN had said that Israel might be guilty of war crimes in Gaza, and they wanted to launch a commission into that. America won't sign up to it.

What is going on in America? I know from my own experience how slanted your news is, and how little you get to hear about the other side of this story. But - for Christ's sake! - it's not that hard to find out. Why does America continue its blind support of this one-sided exercise in ethnic cleansing? WHY? I just don't get it. I really hate to think its just the power of AIPAC… for if that's the case, then your government really is fundamentally corrupt. No, I don't think that's the reason… but I have no idea what it could be.

The America I know and like is compassionate, broadminded, creative, eclectic, tolerant and generous. You, my close American friends, symbolise those things for me. But which America is backing this horrible one-sided colonialist war? I can't work it out: I know you're not the only people like you, so how come all those voices aren't heard or registered? How come it isn't your spirit that most of the world now thinks of when it hears the word 'America'? How bad does it look when the one country which more than any other grounds its identity in notions of Liberty and Democracy then goes and puts its money exactly where its mouth isn't and supports a ragingly racist theocracy?

I was in Israel last year with Mary. Her sister works for UNWRA in Jerusalem. Showing us round were a Palestinian - Shadi, who is her sister's husband and a professional guide - and Oren Jacobovitch, an Israeli Jew, an ex-major from the IDF who left the service under a cloud for refusing to beat up Palestinians. Between the two of them we got to see some harrowing things - Palestinian houses hemmed in by wire mesh and boards to prevent settlers throwing shit and piss and used sanitary towels at the inhabitants; Palestinian kids on their way to school being beaten by Israeli kids with baseball bats to parental applause and laughter; a whole village evicted and living in caves while three settler families moved onto their land; an Israeli settlement on top of a hill diverting its sewage directly down onto Palestinian farmland below; The Wall; the checkpoints… and all the endless daily humiliations. I kept thinking, "Do Americans really condone this? Do they really think this is OK? Or do they just not know about it?".

As for the Peace Process: Israel wants the Process but not the Peace. While 'the process' is going on the settlers continue grabbing land and building their settlements… and then when the Palestinians finally erupt with their pathetic fireworks they get hammered and shredded with state-of-the-art missiles and depleted uranium shells because Israel 'has a right to defend itself' ( whereas Palestine clearly doesn't). And the settler militias are always happy to lend a fist or rip up someone's olive grove while the army looks the other way. By the way, most of them are not ethnic Israelis - they're 'right of return' Jews from Russia and Ukraine and Moravia and South Africa and Brooklyn who came to Israel recently with the notion that they had an inviolable (God-given!) right to the land, and that 'Arab' equates with 'vermin' - straightforward old-school racism delivered with the same arrogant, shameless swagger that the good ole boys of Louisiana used to affect. That is the culture our taxes are defending. It's like sending money to the Klan.

But beyond this, what really troubles me is the bigger picture. Like it or not, in the eyes of most of the world, America represents 'The West'. So it is The West that is seen as supporting this war, despite all our high-handed talk about morality and democracy. I fear that all the civilisational achievements of The Enlightenment and Western Culture are being discredited - to the great glee of the mad Mullahs - by this flagrant hypocrisy. The war has no moral justification that I can see - but it doesn't even have any pragmatic value either. It doesn't make Kissingerian 'Realpolitik' sense; it just makes us look bad.

I'm sorry to burden you all with this. I know you're busy and in varying degrees allergic to politics, but this is beyond politics. It's us squandering the civilisational capital that we've built over generations. None of the questions in this letter are rhetorical: I really don't get it and I wish that I did.



And now, Peter's reply:

Dear Brian and friends,

I am writing to respond to your note about Gaza and how America is responding. It deserves a response. My feelings and the actual realities are complex on several levels; the realities of the Arab-Israeli history and conflicts, global politics and modern American history/demographics. All three levels interact to create the current situation. And to understand the US posture you have to consider the history. Let me say, that, as you know I am an immigrant and child of Holocaust survivors. I am culturally Jewish, but with no religious or spiritual inclinations, an atheist. And I believe that creating the Jewish state of Israel was a historic mistake that is likely to destroy the religion behind it. The actions nation states take to assure their survival are usually in contradiction to any moral values that a religion might espouse. And that contradiction is now very evident in Israel’s behavior. Israel will destroy Judaism.

First, the history has two important intersecting threads, Zionism and the end of the Ottoman Empire. Zionism began near the end of the nineteenth century as a response to a millennium of anti-Semitism in Eastern Europe. An end to the diaspora and a return to the biblical homeland were seen as the only hope of escaping the persistent repression of places like Hungary, the Ukraine, Russia, etc. The British government with its Balfour declaration (1917) and the League of Nations Palestine Mandate (1922) gave impetus to that hope. And of course WWII and the Holocaust sealed the deal. The murder of 6 million Jews was seen as sufficient reason to pursue a Jewish state and the UN granted that wish with the partition of Palestine into Jewish and Arab States in 1947. The seven Arab states declared war and urged the Palestinians to flee. After defeating the Arab armies Israel made it very hard for them return. Hence we ended up with a large Palestinian refugee population.

Those Arab states themselves were the result of a combination of British/French artistry in drawing the maps of the post Ottoman world as well as the subsequent tribal military campaigns that left the Saudis in charge of the Arabian peninsula (vast oil wealth soon to be found) and the Hashemites driven up into Trans Jordan. Other than the war with Israel, the conflicts and rivalries among the various Arab and Persian factions have shaped Middle Eastern and North African politics ever since then.

Over the subsequent decades following the 1948 war there was a persistent Arab bombing campaign and two more large scale Arab attacks on Israel, 1967 and 1973. Until the mid seventies Israel was seen as having the moral high ground based on the holocaust and Arab behavior. But beginning with the Israeli incursion into Lebanon in the early 80s that moral position began to erode. Israel’s behavior in Lebanon was the first major example of aggressive action and attacks against vulnerable populations. Israel began to develop a more right wing and aggressive political faction of which Netanyahu is the worst current example. The settlements in Arab territory in the West Bank are the direct result of that evolution. (And of course the mass migration of the 1990s mainly from Russia) Suicide bombings and missile attacks were the Arab response. Walling themselves in was yet another ironic Israeli response. Today’s horrors are a continuing extension of those conflicts following a cease-fire of a few years.

Once Israel declared itself a Jewish state in 1948 the Palestinians had only three options; accept a division of the land into two states, accept being second-class citizens in the Israeli state or perpetual conflict because they could not win. The Arab states chose the third option because it is in their interest to maintain unity against their common enemy, Israel. They could even share a common enemy with the hated Persian Shiites in Iran. So rather than helping the Palestinians develop by investing in education, health care, jobs, infrastructure etc. the Arab states, especially Saudi Arabia help keep them poor but well armed. Palestinian refugees would remain a festering sore in the Middle East to remind the world of Israel’s perfidy. And of course any aid that did come ended up in corrupt pockets not in helping development. The obvious counter example was Jordan, which developed itself, with little help from their Arab brethren and eventually made grudging peace with Israel. The difference in Jordan was good Arab leadership that recognized that Israel was not going way and war forever was not a good development policy.

At the geopolitical level several threads played out. The UN became a place where the Israel and Arab conflicts became a symbolic pawn in the Cold War, especially in the Security Council with the US on the Israeli side and the USSR on the Arab side (with exceptions i.e. the Saudis). That hardened the US position and associated in American minds Israel with our side and the Arabs with the other guys.

Even though I have no support for the Israeli position I find the opposition to Israel questionable in its failure to be similarly outraged by a vast number of other moral horrors in the recent past and currently active. Just to name a few; Cambodia, Tibet, Sudan, Somalia, Nicaragua, Mexico, Argentina, Liberia, Central African Republic, Uganda, North Korea, Bosnia, Kosovo, Venezuela, Syria, Egypt, Libya, Zimbabwe and especially right now Nigeria. The Arab Spring ,which has become a dark winter for most Arabs and the large scale slaughter now underway along the borders of Iraq and Syria are good examples of what they do to themselves. And our nations, the US, the Brits, the Dutch, the Russians and the French have all played their parts in these other moral outrages. The gruesome body count and social destruction left behind dwarfs anything that the Israelis have done. The only difference with the Israeli’s is their claim to a moral high ground, which they long ago left behind in the refugee camps of Lebanon. They are now just a nation, like any other, trying to survive in a hostile sea of hate.

We should be clear, that given the opportunity, the Arabs would drive the Jews into the sea and that was true from day one. There was no way back from war once a religious state was declared. So Israel, once committed to a nation state in that location and granted that right by other nations have had no choice but to fight. In my view therefore, neither side has any shred of moral standing left, nor have the nations that supported both sides.

So now let’s at look at why the US behaves as it does with a nearly uncritical support of Israel. You are right to criticize our media in so many ways, but that only makes things worse it does not really explain why. They are simply doing what they think their audiences want to hear. And they are mostly right.

Part of it has to do with post war American evolution and perceptions of Israel and the Arabs. When I was a boy in the fifties, through my teenage years anti-Semitism was still common in America. If you were Jewish you did not go to work for IBM or GE. You did not join the Navy. You did not go to Harvard, Princeton or Yale. I could not play tennis at my local country club. I regularly heard derisive, anti-Semitic comments from some of my classmates. But by the mid sixties along with the civil rights movement, toleration in general increased and anti-Semitism declined, almost vanishing. Support of Israel was part of that tolerance and was seen as a noble response to the Holocaust. The Arabs were seen as the oppressors and enemies of the US. That perception was given particular impetus by the oil embargo of 1973 and of course the Iranian revolution, even though it was Persians not Arabs, because Americans don’t see that distinction. (We should never forget that we have a Republican dominated Congress, half of whom do not own a Passport and see ignorance as a virtue.)The Israelis were seen as innovative and benign, people who made the desert bloom. To this was added the growing and ironic support from the US religious right who saw the route to salvation as the Israeli defeat of the Arabs leading to a second coming of Christ. (Of course, we Jews would have to convert to Christianity to survive the second coming.) 9-11 amplified the American antipathy to the Arab world. Seeing the delight throughout the Arab world at the fall of the twin towers did not endear the Arabs to the American people. We can add Saddam, Khaddafi and Osama Bin Laden to the pantheon of iconic American villains. The UN is no longer seen as legitimate and almost always acting against US interests.

So my generation and most of today’s American leadership grew up with the Israeli’s as heroic good guys and Arabs/Persians as greedy bad guys. The younger generation, my son Ben’s age (24) have a much more balanced view. Israel’s behavior in their youth, the last two decades, has destroyed whatever moral standing the Israeli’s had with them. In addition the pro Israeli lobby in America has been very effective in the political arena and their Arab counterparts have been counter productive. So our leaders who group up with noble Israel and evil Arabs and supported by Jewish political contributions are unequivocally pro Israeli while young people are more divided as is at least some of the Jewish community. Eventually demography will win out as a new more skeptical generation comes to power, a generation for whom Israel will not carry the same moral weight as it did for their parents.

I don’t think there is any honor to go around here. Israel has lost its way and commits horrors in the interest of their own survival. And the Arabs and Persians perpetuate a conflict ridden neighborhood with almost no exceptions, fighting against each other and with hate of Israel the only thing that they share.

It is also worth noting that the largest Muslim populations are not Arab and the largest, Indonesia is fairly peaceful. So it is not about religion. The Arabs have been engaged in tribal conflicts for centuries that have been from time to time quelled by Imperial powers like the Ottomans and strong men like Saddam and Ibn Saud. And in those wars they have committed horrors on their own people. Observe the genocidal destruction of Homs by Hafez Assad just to point to a recent example. The Zionists brought another tribe to the war. It is of course a tribe that is also divided, like the Arabs, in to factions, some of which are fanatical and war like and others more moderate. The comments about the racism of the Zionists are fair, but the Arab world does not lack for similar attitudes. One need only see how the vast number of South Asian, Philippine and African near slaves are treated even in the more benign countries like the UAE.

So given that history and current reality and even though I believe the creation of Israel was a historic disaster, I am a member of the tribe, (perhaps its more pacifist, atheist wing) I find objectionable the unique singling out of Israel for condemnation. So if we are prepared to boycott, condemn, shame, etc, the Saudis, the Qataris, the Iranians, the Egyptians, the Syrians, the Russians, the Nigerians, the Taliban, the Venezuelans, the Zimbabweans, the Sudanese, the south Sudanese, the Central African Republicans, and lets not forget the Americans and the British, all of whom are as guilty as Israel, then I will join the demonstration. (Two small things that might help would be if the rich Arab states provided some funding and development assistance for the Palestinians and if the Palestinian government didn’t steal all the aid.)

We find ourselves at a historic impasse. There is no way back. Israel will do whatever it takes to survive. They will not leave. And the Arab identity has become opposition to Israel. It will be centuries, if ever, before they accept the existence of Israel. So both sides will always rightly feel threatened. There will be no other state there but perpetual tribal war with an occasional truce. And in that perpetual state of tribal war there be ample opportunity for horrors on both sides. We can only hope to lower the level of violence, but true peace will remain illusive.

Peter Schwartz


Thursday, July 24, 2014

Reflections on the Gaza War of 2014

At this writing Operation Protective Edge is almost two weeks along and Palestinian casualties just topped 800 today. IDF losses are in the low two digits but I don't recall the exact number. I'm copying here for future reference a long Facebook reflection buried in a comment. 

I'm reflecting on this idea as it relates to the IDF assault on Gaza.

At the outset of this IDF Gaza incursion I had a divided opinion about Hamas and the Palestinian resistance. In the weeks and days leading up to the war the political fortunes of Hamas were looking down. Byagreeing to a unity government with Fatah and the Palestinian Authority Hamas was signaling a timid but measurable step toward yielding to it's doctrinaire extremist position -- particularly the part about eliminating Israel from the map.

With the Muslim Brotherhood banished in Egypt and conflicts burning in Syria and Iraq the status of Hamas in the Arab world was (and still is) on the decline. No longer was Hamas the mascot of the Arab world. Finding common ground with Fatah was more than symbolic. It was huge.

The killing of three Israeli teens was not an action of Hamas. But it gave Netanyahu all the excuse he needed to stir up support for launching Operation Protective Edge, the name of the current military action. The revenge counter-killing of the Palestinian teen by burning alive was a renegade gesture, but the timing was right to give the IDF operation a boost.

Until then and for the next few days I had hopes that something would happen in Gaza to shift public opinion against that group. After all, launching rockets which were mostly symbolic in the face of an overwhelming military machine was a suicidal gesture. The damage they inflicted was real, but not fatal. As the Palestinian casualty count mounted and the body count rose to the hundreds I expected to see or hear some murmuring of discontent with Hamas among the people in Gaza.

But i was wrong. Although they may not care for Hamas, it seems the population of Gaza holds Israel, not Hamas, responsible for all that's happening. There is ample evidence now that they are becoming -- as Hemingway's quote suggests -- stronger at each broken place.

Over the last few days I have seen several indications of Palestinian unity.

>> A man in Gaza interviewed by NBC two nights ago said it was clear to him that the aim of the IDF was to annihilate the Palestinians altogether. He said clearly "I can't continue to live like this. I would rather die along with everyone else than run away. Let them kill a thousand more -- as many as they can -- it's better to die than go on living like this." He was unequivocal. 

>> A day or two before a Twitter message was about a father deciding if he should divide his family to different corners of the house so that some of them might survive, or all be together in one location so if they die they might all go together. 

>> I have posted a video and seen several others of Palestinians risking their lives to rescue or protect others by remaining in some dangerous place.

The stories are multiplying of increasing numbers of Palestinians preparing to die rather than giving up. I am reminded of a couple of items from Jewish history itself bearing the same level of social cohesion in the face of a threatened death.

A rather misguided book about the life of Jesus depicts Him as a "zealot." The writer uses that term in the historic sense. The meaning of the word derives from a historic reality described by the ancient Roman historian Josephus.
The year 67 saw the beginning of the great war with the Roman legions, first under Vespasian and then under Titus; and Galilee was at the outset chosen as the seat of war. The Zealots fought with almost superhuman powers against warriors trained in countless battles waged in all parts of the known world, and when they succumbed to superior military skill and overwhelming numbers, often only after some act of treachery within the Jewish camp, they died with a fortitude and a spirit of heroic martyrdom which amazed and overawed their victors. Josephus' own description of the tragic end of the last great Zealot leader, Eleazar ben Jair, and his men after the siege and final capture of Masada is the best refutation of his malicious charges against them.
As every schoolboy knows, the mass suicide at Masada is an integral part of Jewish history.

What we are witnessing in Gaza today is a recapitulation of that historic event. But the survivors of that sacrifice are now the perpetrators of the same phenomenon, this time with their Palestinian neighbors as targets of their rage.

There can be no other explanation of the slaughter of women and children. Calling them "human shields" implies that they are being forced to confront their deaths against their will. That does not appear to be the case any more. Clearly they are prepared to die rather than continue living under the conditions they know so well.

These children do not recall a time without the conditions of a harsh occupation. Their imaginations do not allow them to see anything different. As the world watches another genocide is in progress.


A few days prior to this one of my Facebook friends posed a question that prompted the stream of consciousness copied here. The post was a reflection of a Jewish writer, a holocaust survivor who was an infant in Poland during that time, recounting a conversation with an old friend from that time when both of them were among the first Zionists.  

Question: Should Israel just pull out of Israel and leave again? that seems the only solution, but i don't know where all they would go.

(Reply)  I honestly don't know. There is no way for the clock to be turned back. And even if there were there is no assurance that it might not lead to an even worse outcome. This next to the last paragraph is sad and moving...
A few days ago I met with one of my dearest friends, a comrade from Zionist days and now professor emeritus at an Israeli university. We spoke of everything but the daily savagery depicted on our TV screens. We both feared the rancour that would arise.
They had everything important in common, and something told both of them that the discussion of Palestine/Gaza/West Bank would only lead to a bitter argument, even between them, two people who had shared the same vision years ago but had come to very different places today.

I recall when the 1967 war happened, I was in Korea, hearing and reading about it from half a world away. Because if my close association with Jews from my civil rights and high school days I had more than the usual sensitivity to the circumstances under which Israel was living. At that time I was fully sympathetic with Israel because the country really was surrounded on all sides by hate-filled neighbor countries that aimed to annihilate them from the map. That part of the narrative -- still intact in the minds of many Jews, especially in Israel -- was not imaginary.

I recall we had only one Jew in the little base where I was assigned as part of a seven-man medical detachment. He was following events of the war minute by minute, cheering on Israel like a sports fan supporting a team. He ran around yelling "Guns for the Jews -- sneakers for the Arabs!!" and was overjoyed at the outcome.

My take on the 1967 war was not that much of a gushing enthusiasm.After all, I was serving as a conscientious objector an my understanding of war was (and still is) not the same. But I did appreciate that Israel was really surrounded by hostile neighbors on all sides and they did what had to be done to secure their national safety. What are now the Occupied Territories (West Bank and Gaza) and territories beyond were all under the undisputed control of the Israeli defense forces. That control stretch Westward into Egypt all the way to the Suez Canal, East to the Jordan River, South into the Sanai and North into the Golan Heights -- all places that were strategically threatening to Israels official borders.

What happened next was a study in geo-political realism on Israel's part. Egypt's land was returned to Egypt, both to the West and South, but they retained control of the Golan Heights (where Syrian forces (which were mostly displaced Palestinian Arabs, many living in refugee camps that exist to this day) and the territories now known as the West Bank and Gaza.

It was an imperfect outcome, but at the time it was nothing more than an open and shut case of national self-defense. I was 100% supportive of Israel and like many others was in awe of the capability of their military. I don't recall if it was prior to that or later, but I vividly remember how the world watched in awe as an Israeli plane was hijacked by what we now would call "terrorists" and hostages were involved. With lightning surgical precision a relatively small Israeli force struck under cover of darkness, eliminated the perpetrators and recovered their plane. It was better than a movie plot-line, but it was real. The IDF was (and still is, tactically) among the world's most effective.

A lot has happened between then and now, but over time Israel which was a de facto American presence in the Middle East has become less critical in the overall global picture while their handling of the Occupied Territories has been anything but a case study in how an occupying force should handle a defeated enemy.

Unlike how Germany and Japan were treated following WWII, and how Vietnam and Korea have been dealt with after those conflicts, the Occupied Territories have not been managed with a view of rehabilitation. The situation was unique, of course, since the bitter hostility on the part of the Palestinians did not diminish. Instead it took a sinister turn, with bombs and killing of innocent people in Israel being the tactic of choice.

But Israel has shown nothing of the restraint that might lead to reconciliation. It has been official policy to incrementally seize the occupied lands and displace the people who have lived on them for generations, replacing them with newcomers from all over the world. The "settlements" that have made the map of the West Bank look like a piece of Swiss cheese are subsidized by Israel and populated in large part by newcomers to Israel.

In the case of Gaza there were Israeli "settlers" as well, but a few years ago Ariel Sharon led a deliberate policy decision to abandon Gaza to the Arabs and concentrate on developing the West Bank to be a de facto extension of Israel, taking it from the Arabs who have lived there for generations little by little, by whatever means it took to make that happen.

It was a dramatic news story when the Jews who had been settled in Gaza were forcibly removed from their homes, gardens, fields and businesses by none other than the Israeli Defense Forces. Perhaps you recall those news stories from 2004/5. It was after 9/11 and American attention was still more focused on our own tragedy, but I just looked and it is one of the longest topic articles in Wikipedia.

I'm writing off the top of my head from memory, and this is entirely too long for a Facebook comment, but I only want to communicate that I have more than the usual off-the-shelf Readers Digest summary of the background of this horrible and ongoing business with Gaza.

The link above, together with a large and growing number of Jews both in America and in Israel, indicates that after all this time the politics of Israel has become in many ways a model of the very forces that created Israel in the beginning. That for me means the establishment of Modern Israel -- not what is now called Eretz Israel by those for whom several thousand years of geopolitical metamorphosis has no meaning.

Dang, I have to stop and get going into my day.
Forgive me for running on.
I hope this has not been too much of a drag...

Monday, July 7, 2014

Robin Hood Tax -- A Layman's Explanation


Circumstances not easily explained have shifted my online creative time and energy from blogging to social media. Facebook and Twitter now take most of my time, with blogging reserved for subjects too arcane or unpopular for other media.  Blogging has always been more a scrapbook exercise for me than activism, so the shift is not as problematical as it seems. 

For reasons not clear to me, however, when I post some thoughts and links at Facebook they immediately appear on my newsfeed, but in a few cases seem to vanish. I can visit my personal Facebook link and they are always there, but since they never appear among those of my friends it makes me think they are not being sent out to them with the same priority as those recipes, selfies, infographics and cat videos that clutter the world of Facebook. It's almost like some subjects are too cerebral to survive the Facebook milieu. Needless to say, I never get comments or "likes" for any of those posts. Or as Facebook quaintly calls them "status" reports. 

In any case, today's links are in that outcast category. Here ends this morning's rant.
I have no idea why the copy and paste feature is not working with Facebook. I never noticed that before, but here is what I want to blog about.

This is the explanation of the Robin Hood Tax at the website.
Simply put, the big idea behind the Robin Hood Tax is to generate hundreds of billions of dollars. That money could provide funding for jobs to kickstart the economy and get America back on its feet. It could help save the social safety net here and around the world. And it will come from fairer taxation of the financial sector.

This small tax of less than ½ of 1% on Wall Street transactions can generate hundreds of billions of dollars each year in the US alone. 
Enough to protect American schools, housing, local governments and hospitals. Enough to pay for lifesaving AIDS medicines. Enough to support people and communities around the world – and deal with the climate challenges we're facing. 
It won't affect ordinary Americans, their personal savings, or every day consumer activity, such as ATMs or debit cards. It's easy to enforce and tough to evade. 
This is a tax on Wall Street, which created the greatest economic crisis in our nation, and globally, since the Great Depression. The same people who have returned to record profits and bonuses while ordinary Americans, the 99%, continue to pay the price of their crisis. 
So it's time for justice for ordinary families and businesses. For American families faced with a choice between buying food or paying the heating bill. 
The Robin Hood Tax is just. The banks can afford it. The systems are in place to collect it. It won't affect ordinary members of the public, their bank accounts or their savings. It's fair, it's timely, and it's possible. 
It's not a tax on the people, but a tax for the people.
The purpose of this post is now finished.
The reader now has the idea and the link.
No need for me to insult him or her further with more arguments.

The reason I am blogging and posting to Facebook is simple. When I first heard the idea it struck me as deceptively simple but politically impossible to put into place. I imagined the main argument to be the crushing administrative burdens it would place on the banking and financial transactions sector just putting it into place.

But I was wrong to worry about that. The fact is that the infrastructure is already in place and has been in use for a long time, thanks to the advent of computing and high-frequency trading. I had no idea how truly sophisticated those transactions really are.  I have only a vague grasp of this next quote, but it is clear that the notion of tracking, computing and charging incremental fees per transaction is an everyday part of the transactions envisioned by the Robin Hood Tax.  Here is the link to an entry at Dave Hunter's blog.
For passive trades, when trading in LX, Barclays lose the $0.0015 per share rebate they would get trading on NYSE, but they make up for some of that by charging HFTs $0.0002 to $0.0005 per share for aggressive trades. 
If you assume that the ratio of passive orders to aggressive orders is 50:50, then Barclays saves approximately $0.0014 per share by trading institutional orders against HFTs in LX versus trading on NYSE. 
$0.0014 per share cost savings doesn't sound like a lot. However, with client commissions for electronic orders in the order of $0.01 to $0.02 per share, this can have a significant impact to the bottom line of an electronic trading business. LX matches 285 million shares per week. This equates to approximately $20 million a year in cost savings. Not a huge amount compared to the $4 billion in equities revenue in 2013, but, due to constant client pressure to reduce commissions, equities is an incredibly low-margin business, and this is certainly enough to incentivise a heavily-siloed electronic trading business.
$0.0014 = fourteen percent of a penny, about a mill and a half. That's a very small amount, very much like the millage rate figuring county and local property taxes. And that's not the smallest of arithmetic cited here.
The smallest amount tracked is $0.0002 to $0.0005 per share for high frequency trades (HFTs). Those are not two to five percent of a penny, but two to five percent of a mill, which is only a tenth of a penny.

Gone are the days of salami-slicing when some low-level accountant could quietly open a dummy account into which fractions of interest arithmetic might be tossed, never accounted for, but accumulating over time until that clever bean counter had accumulated a serious amount of money. Some such schemes didn't wait for fractions of interest to come around, but actually stole tiny amounts from accounts so big they would "never be missed."  No, this is actual practice, all legal and above board. But only the shreqdest and most informed of investors is paying attention.

This is part of the banner image of Dave Hunter's blog.
And for readers interested in further details, here are his delightful opening paragraphs.
As the former head of electronic trading product management and quantitative strategies at Deutsche Bank, responsible for their dark pool in Europe, I wanted to add my own 2 cents to the noise surrounding Barclays and their dark pool, LX. 
Eric Schneiderman, New York Attorney General, has some serious beef with Barclays because they filled their dark pool, Barclays LX, with high-frequency traders (HFTs) and then lied about the highly predatory nature of their trading strategies to their institutional clients. They erased key data from marketing material and gave private, sensitive information to HFTs about other participants in the pool. 
As us brits would say, 'a rather silly move'.

Friday, July 4, 2014

Independence Day, 2014

This Facebook entry was prompted by an NPR feature regarding the recent SCOTUS ruling, popularly called the Hobby Lobby case. 
Today is a good time to be reminded about the importance of conscientious objection to laws. Since I was drafted as a conscientious objector in 1965 this is for me more than an academic discussion. I have more than the usual respect for the "conscious exception" to laws, but it is clear to me that individual people have consciences but companies and organizations do not.

We live at a time when machines and computers are undeniably smarter, stronger and more reliable than human beings. There is evidence that Google's self-driving cars, when finished, will be more efficient, reliable and safer for passengers, pedestrians and other vehicles. But like all machines they will not -- nor ever will be -- able to think, feel or make moral choices.

Corporations, like those cars, are endowed with super-human qualities. They can achieve feats of production, economy, speed and efficiency that surpass the most impressive human qualities. But like those self-driving cars, corporations cannot -- nor will they ever have -- moral agency. That will forever be a uniquely human quality.

Laws that confuse human beings with corporations are fundamentally ill-conceived. Private organizations and companies, both large and small, whether "closely-held" or not, can make all the rules they wish about what they do and who can be or not become a member. But they do not have, nor will they ever have, a human conscience. And no amount of legal prestidigitation will ever make it otherwise.

Courts make rules about the law, but no amount of court rules will endow corporations with feelings or consciences. Those are what make human beings, with all our shortcomings, unique in the world. We often make poor choices, and bring about spectacular disasters by our wrong choices. But in the end we have no one to hold accountable -- individually or collectively -- but ourselves.

I'm not aware of any corporation, machine or other man-made creation capable of feelings of pain, sorrow, excitement, guilt, love or amazement. No human will ever be capable of finding mistakes in production or hidden weakness in a manufactured product as well as a machine. But no machine or corporate structure (or political system for that matter) will ever come close to the human imagination and capacity for evaluating what is happening and take steps to make changes -- and sometime those efforts come at a painful price in suffering, sacrifice and damaged or lost lives. Even following wars and protracted periods of loss or suffering, we as humans still face the grim reality that we brought them on ourselves -- even if it means recalling that horrible warning that "All that it takes for evil to triumph is for good men to do nothing."

The time has finally come for Congress to find the collective courage and formulate the language to end, once and for all, the ridiculous notion that corporations have the same legal rights as people. Finally, with last week's decision by the Supreme Court, we have clear evidence that the so-called Religious Freedom Restoration Act of 1993 actually "restored" nothing that Americans ever lost. Our religious freedom was one of the elements leading to the creation of a "united" assembly of individual states, many of which were formed on the basis of different religious beliefs, but "united" in a political arrangement suiting their collective needs for protection, commerce and "the blessings of liberty" as articulated in the US Constitution.

One of the qualities of our system is the capacity to make changes. Though many of our founding fathers were slave-holders and the growth of the country actually included statutory language defining slaves as 3/5 of a person, and one of history's bloodiest conflicts was the US Civil War, we finally developed to the point that a black president was elected in 2008. A similar litany of change can be traced for women's rights. When my mother was born women had only been allowed to vote for a few years and her mother --my grandmother and her generation -- reached adulthood without ever having the right to vote.

When the Supreme Court ruled in Plessy v Ferguson in 1896 that "separate but equal" was the best way to thread the racial discrimination needle, that ruling was in effect over half a century until the Brown decision reversed it in 1954. When one of President Clinton's first political initiatives was an attempt the allow gays to serve openly in the military, the best he could achieve was a somewhat opaque concession in the form of "don't ask, don't tell." That standard lasted until recent years when the rights of LGBTI persons have finally started to get full recognition.

That so-called Religious Freedom Restoration Act is now over twenty years old. Hopefully we will not have to wait half a century until the fictions on which it rests, along with the bizarre idea that corporations are people, are corrected.

Wednesday, July 2, 2014

Too Little, Too Late

The time to use an amnesty to separate Iraqi nationalist insurgents from jihadis using Iraq as the frontline in their pan-Islamic war against the west was two years ago. The US-selected provisional government of Iyad Allawi tried this - but it was vetoed by a Bush administration opposed to pardoning any insurgent with American blood on his hands. President George W. Bush, on return from his flying visit to Baghdad, indicated that has not changed. 
That is an understandable but unsustainable attitude. It is time Washington acknowledged its grievous mistakes in Iraq. It broke the back of the state by disbanding the regular army and by blanket de-Ba'athification that drove the hitherto dominant Sunni Arab minority into armed opposition. 
A broad-based but targeted amnesty to reunify Iraqis and isolate the extremists may be the last chance to save the country from breaking up into a series of warring states run by militias. An amnesty is indispensable, even if it may not be enough. 
That is because the essential nature of the conflict has changed from a guerrilla war against the US-led occupation to a sectarian war between the winners and losers in the new order - which has at its heart the Sunni-Shia war fomented by Zarqawi. In this phase, it is just as important for the government to control Shia and Kurdish militias as to divide the insurgency.
Separating nationalists from jihadis could not have been more critical. That was nearly a decade ago, and even then a few smart people said such a move should have been made two years prior to that. So here we are today watching the same extremists sweeping across Syria and Iraq like an invasion of fire ants.

I paid close attention to those early elections in Iraq. It was about that time that I became aware of Vali Nasr. I was so impressed I ordered his book. When I look back now at my notes it frustrates me to think that if I, an old guy blogging in retirement, could see what was unfolding, why did the people in charge not see what I saw?