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Nicholas Levis "The Emerging
Crisis of the Dollar and
Part 1: The Crisis of the Dollar and the Peril of June 2004 This is an exercise in exposing the obvious. I am not an economist, which is useful for our purposes, because I am going to outline for you in simple terms a reality that you can figure out easily for your own self as a lay person: The hidden story of the U.S. dollar. A story that most economists prefer to deny or decline to discuss. There are important exceptions, however, and you can find them on both the left and the right. The following analysis owes a lot to a classical Austrian-school economist by the name of Kurt Riechebacher, and to a libertarian analyst, Richard McClendon, who puts out an Internet newsletter known as the McClendon Report. But also to people like Doug Henwood of WBAI and his writers at the Left Business Observer. And my Italian professor friend, Paolo Giussani, who is proud to still speak of a Marxist analysis. The ideology doesn't matter, facts and logic do. Other influences have definitely included Mike Ruppert, whom many of you know, and Catherine Austin Fitts of the Solari Network. In presenting the case, I'm going to avoid the numbers. I'm not going to wow you with talk of mega-billions. The numbers are available, and you can check them for yourself. In fact, you must check for yourself, don't simply accept what I say. But the numbers often serve to obscure. Today, I am going to try something unusual for a presentation on macro-economics. I'm going to speak English. The macroeconomic debt figures for the United States - personal, corporate and government - are now at the highest levels in history relative to known production capacities, GDP or asset valuations; and proportionately higher than in 1929, the year of the last great global crash. On paper, the situation is worse than for Argentina during its recent default. The U.S. economy runs on credit. For many years, the American people as a whole have been net borrowers, buying or investing a sum much higher than they produce in goods or take in as income. Economists have a euphemism for this condition, they call it "negative savings." But the more honest phrase is "going bankrupt." Our country can look back on 30 years of exorbitant trade deficits. We spend more than we earn, and we produce ever less of the goods we consume. And yet we work more than almost anyone else in the industrial world. We have a Walmart economy. We receive goods and technical services from the world. In exchange, the world accepts dollars generated by our banks in the form of seemingly limitless, low-interest credit. The world tends to reinvest these dollars in dollar assets. This has contributed to an enormous bubble in assets, especially a real-estate bubble and equity markets that are still wildly inflated, with continuing record levels of equity price-to-earnings. Foreigners also use their dollars to provide generous financing of U.S. federal, state and municipal bonds. They back our exorbitant government deficits, and this on public budgets that already devote a third or more of the revenues just to pay off interest on government debt. In another age, the constant making of dollars to finance a trade deficit and government deficits would have meant a much greater price inflation than we have seen. The dollar would have wilted. What we have seen instead has been an asset price inflation, something that most Americans (and foreign investors) think is dandy, since it means their properties and equities have gone up, at least in nominal value. Excess dollars go into assets, and these appreciate. As asset prices inflate, assets serve in turn as collateral for further borrowing. This has maintained asset prices at high levels and fed ever further expansion. It all floats for as long as too many people don't want to sell their assets at the same time. Further pumping the bubble has been an outrageous cooking of the macroeconomic statistics. I shall point out only the most ridiculous way used in recent years to inflate the country's stated national growth rates: the "hedonic deflator." Anyone here know what the hedonic deflator is? Raise your hand. (Explaining the hedonic deflator: It's interesting that it's called a deflator, because its effect actually is to inflate national growth and productivity statistics. More double-talk. So let's call it the "hedonic adjustment." It is a statistical trick, based on the premise that the massive increase in computing power over the last decades translates automatically into higher productivity, and that this should be reflected in dollar terms, in the growth statistics. Specifically, purchases of computers and networks are given a greater weight within GDP than other items, and this serves to boost the percentage growth in Gross Domestic Product. The statistics no longer reflect the actual dollars paid within the computer industry. Instead the dollar totals are multiplied to reflect increases in processor speed and hence, supposedly, efficiency. I therefore prefer to call it the Megahertz Bonus. But of course you can't spend your megahertz like you can your dollars, so this is a scam. It is confounding productivity with GDP growth. During the worst bubble years of the late 1990s, the effect of the hedonic adjustment was to literally double the nominal growth rate of U.S. GDP. Since this was not reflected in actual dollar GDP growth, it was only on paper, and it was a falsification. Now imagine you were an accountant at a company and you claimed that the company's statement of profit should be multiplied because the boss had purchased new and faster servers. You can't do that, as an accountant. - Oh, wait, I forgot about Enron and Tyco! - and that is what the government does with the macroeconomic growth statistics for the economy as a whole. In 2001 this practice caused the German Bundesbank to actually complain to the U.S. government that it was falsifying U.S. growth statistics, and thus putting Europe at a disadvantage. But this was only a minor news story. Why?) Europe does not use a hedonic deflator. Fact is, without the hedonic deflator, the growth rates in the late 1990s for the supposedly efficient U.S. economy would have been on a level with the growth rates for a supposedly stagnant Europe. But Europe gets punished for using a more honest form of accounting. The U.S. peddles bogus statistics and gets rewarded. The lie of superior U.S. growth and productivity becomes a reality, when investors decide they'd rather buy dollar assets because the U.S. is showing higher growth on paper. During this supposed period of economic expansion from the early 1990s until today - we're told the recession is over, by the way - the country has continued to export more and more of its production base to overseas locations. Because most of this production is still owned by American companies, intra-company and joint venture trade accounts for two-thirds of the trade deficit. A lower dollar will not necessarily result in a significant reduction of the trade deficit, contrary to what CNBC will tell you. Companies continue to trade with their partners, or themselves. So what are we seeing, in 2004 and already building for many years? Inflated assets, cooked statistics, a world awash in excess dollars, exorbitant trade deficits, record debt levels, deindustrialization at home. Yet still, the dollar floats. What backs this miracle? To answer that, we're going to flash back for a moment to the 1970s and the crisis that triggered the collapse of the Bretton Woods monetary system. Bretton Woods is known as the 1947 conference that established the International Monetary Fund and the World Bank, but what's largely been forgotten in the meantime is that the same conference set up the Bretton Woods currency arrangement. Under these rules, the world's currencies were all pegged to the dollar within certain ranges, and the dollar was nominally backed by a partial, very much nominal gold standard and the cachet of the United States as the world's premiere economy and "Leader of the Free World." Central bankers ran the show directly. Economists differ on whether this system was only possible as the product of relative economic stability, or actually served to maintain economic stability in the Western world for the period today known as the Golden Age of Capitalism, from 1948 to 1973. Regardless, both the relative economic stability and the Bretton Woods system collapsed. I'm going to make a long story short and cut straight to that collapse. In the early 1970s, for various reasons, the up-and-coming, resurgent economic powers of Europe and Japan began to question the value and stability of the dollar. As their dollar reserves and dollar business ballooned, their bankers openly questioned whether they could really redeem any part of their dollars in gold. In response, the Nixon Administration ended the nominal, limited gold standard and unleashed a new global system of free-floating currencies. They launched the post-Bretton Woods dollar. This was in the same period as the OPEC-related energy crises, the mid-1970s recession, and a falling profit rate in established industries within saturated markets. Capital felt hemmed in. It needed new vistas for growth in profit. Logically, there was an acceleration of the transfer of U.S. manufacturing to cheaper labor overseas, and correspondingly in lending to the Third World. And over the next ten years we also saw capital moving massively into two relatively untapped areas: First, financial speculation increasingly became the vehicle of economic growth. This has been exemplified in the last 30 years by the near-total deregulation of banks and financial institutes, and the corresponding bubble economics, and the increasingly open practice of corporate and financial plunder by the elites in banking, government and management. Second, we saw the latest series of booms and busts in the "forced-profit" industries of G-O-D: Guns, Oil and Drugs. That shorthand describes a set of related industries that always come to a fore in crises, because they can create their own markets through force. If there are wars, the military-industrial complex profits. If there are oil shortages, the oil companies pull higher returns. If there is increased anxiety and sickness, if there is fear, if people can just be convinced they need new medicines for syndromes they hadn't even known they suffered from, the use of pharmaceuticals (many of which are petroleum based) spikes up. This not the place to fully describe the historically complex role of illegal drugs as a revenue maker and political influence. Its reliance on force, both the force required to enforce drug laws and the force required to protect the drug trade, is self-evident. It is natural and a matter of historical record that those closest to the state and its military arms are in the best position to control and profit from that trade, both directly by participating in it or letting their proxies participate in it; and indirectly thanks to the chaos and instability the drug trade generates. G-O-D lives off crisis, and naturally attempts to generate crisis so as to create a more profitable environment for G-O-D. These are the largest industries in the world, with the most political power, the greatest reserves of covert force available to them, and the most incentive to hire squadrons of academics and lawyers who provide them with their necessary rationalizations. They feel little need to please the average consumer, many other industries revolve around their actions. Within their sectors, ruthlessness is almost a precondition for success. The trend to G-O-D was exemplified in the late 1970s and 1980s by massive Pentagon budget increases, a big revival in covert operations and arms deals, and CIA-backed drug importation on an unprecedented scale. The latter was coupled with a renewed "War on Drugs," which drove unlimited growth in the prison and security industries. And of course we've seen a new big boom for these and related industries during the last three years, especially since 9/11 under the Bush administration, which is very much a creature of G-O-D (and not necessarily of the god Bush claims he serves). Now to return to the dollar: Since the 1970s we've had a free-floating currency system, but the dollar has still been king. I would like now to touch briefly upon the pillars supporting the post-Bretton Woods dollar of the last thirty years. What backs the dollar? Commodity pricing in dollars, especially "petro-dollarization." The pricing of oil in dollars forces nations to keep dollar reserves. Underpinning this has been the 1970s deal with the primary OPEC oil producer, Saudi Arabia, to maintain petro-dollarization and re-invest oil revenues in dollar assets and the American economy. This has come at great cost to the Third World countries especially, who are forced to trade for dollars, whose currencies are artificially devalued against the almighty dollar, and who are often effectively closed out of the energy market and thus any chance of industrial development. What backs the dollar? U.S. domination and Western control of the IMF, World Bank and WTO system as a means of disciplining potential competitors in the Third World; a system that has bankrupted so many countries, and in which much of the world has now lost faith. A system that may now lack the all-powerful symbolism and enforcement power it once possessed, for example following surprising events like the successful resistance to the series of U.S.-engineered coup attempts against Hugo Chavez in Venezuela. What backs the dollar? As described, the continued U.S. domestic growth and return on investment through financial speculation (increasing the bubble effect and the scale of the ultimate disaster). It may be air, but as long as people believe in it, it's real. A still-powerful domestic production engine, considered more efficient than in other industrial countries. This is advertised as the result of astonishing technical productivity, but in reality, it is mainly thanks to a depression in the price of labor. This is logically accompanied by a concommitant drop-off in education and expertise, and no slowing of the transfer of industry abroad. The decline of unions and the use of an ever growing prison labor pool in industry are thus among the factors that back the dollar. This is a search and destroy, unsustainable economy, cannibalizing its own. What backs the dollar? Easy credit, especially in the 1990s, limited in theory only by faith. Related to that, the U.S. as the world market's buyer of last resort. Did you make something? Can't sell it? No problem, U.S. consumers as a whole can just keep lending to themselves (which means creating) the cash that they need to snap up your excess goods. Then they can lend to themselves the cash they need to keep up the interest payments to the financial entities that run the scam overall. Come one, come all, we got dollars for you. What backs the dollar? The use of the dollar as back-up currency or currency peg in countries around the world, by China (the yuan is pegged to dollar), Central Asia (where dollars are the preferred cash), Ecuador, etc. The use of cash dollars in the world drug economy and the subsequent multiplication of illegal drug-sale revenues through the money-laundering system (another indispensable boost to the bubble economy). Like all commodities, narcotics are also priced in dollars! And every dollar from a covert, "free" source that can be laundered as legitimate profit by corporations can end up reflected twenty or thirty times over in their equity price. There is an enormous incentive to launder money, especially given the environment of heightened competition where as a corporation you are rewarded and prosper for taking every ruthless step you can in gaining advantage, if you can get away with it. They can get away with it, at least so far. Because people believe in the system. You begin to see the importance to the system of the media and advertising cartels with their primary mission of encouraging consumption as the meaning of life and of creating the illusion of unlimited wish fulfillment and eternal growth. What backs the dollar? The increasingly discredited ideology of U.S.-driven globalization. The belief in a U.S. dominance of ideas. The American dream. The Hollywood machine. And, in the final resort, the credibility and effectiveness of U.S. military power in an unstable world - especially the idea that the U.S. can project power in the Middle East in defense of petro-dollarization. What backs the dollar? The final resort lies in war and sheer mad-dog rage. The ultimate replacement for the unviable gold standard or "general exchange" lies in nuclear terror. I call it "The Megaton Standard." The pillars of the post-Bretton Woods dollar are now in peril: The overall instability of a debt-and-bubble economy has become painfully evident to everyone outside these United States, but all of the foreign players are over-committed to dollar assets and dollar business, and uncertain about what to do to save their positions. Hence, the spectacle in recent years, of Japan draining itself to put a floor under the dollar, even as the U.S. is happy to take advantage of that and let it float down slowly. In recent months, however, a threshold was crossed: Japan's trade with China is now great than its trade with the U.S. The two together could become the world's largest trade region overnight. Then we have the advent of the euro. This has been both a defensive and an aggressive move by the world's other great industrial superpower, Europe. There is now a major-currency alternative to the dollar. The euro has made inroads into dollar-currency areas, as did previously the German Mark. At the same time, France, Germany and Russia have aligned in a new defense axis, posing an alternative to NATO and a tacit challenge to U.S. military hegemony - even daring to openly oppose the Iraq invasion. Under sanctions for many years and well aware of the U.S. invasion plans (as stated in the "Project for a New American Century") Iraq switched to euro pricing of oil on the day before the Nov. 2000 U.S. election. (At this point, I'd like to ask, who here is aware of that? Who knows that Iraq switched oil sales to euro pricing in 2000? A show of hands please. Thank you.) Ladies and gentlemen, this was the Iraqi tyrant's shot across the bow of Leviathan. It sealed the fate of Saddam Hussein's regime. In the meantime, Russia has switched oil pricing to euros. This event also went remarkably underreported in the Anglophone business pages. (Who is aware of that? Show of hands. Thanks.) The OPEC countries, from Saudi Arabia to much-pressured Venezuela under Hugo Chavez, now hold the same option in reserve. They can start pricing in euros, any time. But they fear the prospect of the world economic armaggedon that a dollar collapse might bring. Ladies and gentlemen, there were many reasons for the invasion of Iraq. I'd honestly guess that the most compelling one for the direct decision-makers was simply that they had been planning it for so long, and the plan served our most important industry, the military-industrial complex. Certainly the planners themselves were never going to back down until they had done their will, or perhaps I should say: The will of G-O-D. But the Iraq invasion can also very usefully be understood as a means of seizing the world's second-richest store of oil - a real asset - as new collateral to back the air-dollar. The invasion demonstrates U.S. military power and the will to use it. Geostrategically, the U.S. has achieved physical control of the world's key resource at its source, as per the plan, forged seven years ago, of the "Project for a New American Century," also known as PNAC. PNAC was the think-tank initiative that brought together all of the major players of the Bush foreign policy team: Rumsfeld, Cheney, Wolfowitz, Perle, Negroponte, Armitage, Abrams, Otto Reich, even Jeb Bush on behalf of the Bush family. All of them signed the 1997 mission statement, and a 1998 letter urging President Clinton to begin major military action against Iraq immediately. The Project produced one main document, a report on American "defense" that called for total full-spectrum weapons dominance and aggressive deployments worldwide; and for the toppling of the Iraqi regime and the imposition of a New Middle Eastern order (advertised as democracy) by force of arms. PNAC was their way of making a public oath to invade Iraq and re-draw the map of the Middle East order as soon as they came back to power. They made that pledge in 1997; how could they back down after the election of Bush, now that they were so close? When the PNAC invasion of Iraq finally went ahead last year, the U.S. government acted openly against the wishes and protests of its potential competitors for global hegemony in Europe, Russia and China. Our government has enraged the world. The predictable Iraqi uprising against the foreign occupiers now signals all too obviously that the "Project for a New American Century" plan never had a chance of remaking the Middle East in the neoconservative image. As a result the question of the dollar is very much on the minds of financially influential people around the world, even if most Americans have yet to wake up to it - while the PNAC planners, in the Dr. Strangelove tradition of our nuclear establishment, are meantime turning to their darker, more radical scenarios: If you can't shape the Middle East (or the world) with troops, you still might simply flatten it with nukes. This combination is one reason why another professor I admire, Michel Chossudovsky, has refered to our age as the most dangerous in human history. Where are we now? The game of air-dollars may come to a head as soon as June 2004. Americans may not know it, but the world does. The stakes in this game are nothing less than the dollar, the oil, and the image of U.S. power - meaning the present form of the world system itself. The U.S. state must somehow pacify the Iraqi people and bring the Paris-Berlin-Moscow axis on board for a face-saving UN settlement of the occupation question by June 30th. [NOTE of 10/04: The latter was successfully if shakily simulated; the former obviously not.] That is the announced date for transfer of power to an Iraqi authority. Otherwise, the U.S. government will sacrifice its credibility, meaning the image of its ability to project power and stability worldwide. On the sidelines in this game are the American people, who are supposed to obediently vote for one of two war-supporting candidates and thus accept the necessary casualties, both in earnings and in blood; and the holders of the dollar around the world, OPEC, Japan, China, Europe and the rest, who are considering exit strategies but understand that they will be the first to take the hit - even if the consequences of a dollar meltdown will likely be far worse for the people of the United States. The Peril of June 2004 is a crunch-point that may pass by relatively unremarked; the world's power and money elites may yet band together to save the Bush regime and avoid a dollar crisis this year. But the crisis is certain to hit Americans' consciousness, at the latest after the 2004 election. How they then react may determine what happens. The American people could do something really wild, like set up community currencies, build sustainable local economies, and move with vigor towards adopting alternative energies. They could also choose to bring the troops home - dismantle the perpetual war machine that only exacerbates, and can never solve, the problem of foreign terrorism - and end the primacy of the G-O-D industries, which would mean ending the clinically insane War on (some) Drugs. Historically, however, peoples have rarely made these decisions. They have tended to react with fear, and to choose the route that seems most comfortable, the one they believe safest for their survival (even when that's not objectively true in the long run). They have turned to "strong" leaders, men on horseback, or gone with the flow. Economic depressions like the one in the early 1930s, and the one we are likely to face in 2005, may not have always been simply created by elites, since there is an inevitable, systemic nature to them beyond elite control; but their timing has generally been triggered by the choice, and to the profit, of a vanishingly small number of hyper-rich men. Today, if you listen carefully to their boldly stated visions of the future, the hyper-rich men are foreseeing a new Feudalism, be it ever so couched in progressive terminology. Force will replace money as the incentive for motivating the mass of the people. We will be reduced to the literal microchip-carrying serfs of imperial corporations. These will exercise direct control over patches of territory by means of private security forces. The corporate lords will make their own laws, issue their own currencies, probably institute their own religious regimes. The landscapes surrounding their hyper-technical havens will be an even worse nightmare of starving dog eat dog. Who here has seen the film, Blade Runner? (Show of hands please.) Ladies and gentlemen, in today's America, we are already closer to that vision than most prefer to admit. Must we go this way? Part 2: The 9/11 Truth Movement in 2004 Given the interlocking global crises of finance, economy, politics, culture, war and human ecology, the events of September 11, 2001 provided enormous new leverage to those who would mobilize the psychological and material resources necessary to manage the crisis I have outlined. 9/11 rescripted the course of history. It provided instant casus belli for invasions of Afghanistan and Iraq that were planned long in advance, and for a serial War on Terror "that will not end in our lifetimes." What were the chances that the American people would have supported these ventures without 9/11? I do not think it is a coincidence that the Project for a New American Century plan openly acknowledged that its hubris would probably require a "New Pearl Harbor." 9/11 also served as the justification for a hardline domestic program, a program long desired by its sponsors: The USA PATRIOT Act, with its nullification of several articles in the Bill of Rights. A new industry and bureaucracy of Homeland Security. The ridiculous, color-coded system of fear management, Code Orange, Code Red. In sum, 9/11 allowed the shifting of literally trillions in government budgeting priorities and investor priorities from butter to guns, at the cost of record federal and state deficits, with vast profits for the G-O-D interests allied to the Bush regime. Long in advance of 9/11, anyone could have predicted that all of these effects would follow logically from an "Attack on America" by foreign terrorists, if it was only spectacular enough. Among millions of people around the world, the convenience and timing of 9/11 therefore gave rise to suspicions about the true origins of the attacks. The suspicions have been fed by the manner in which the U.S. government was willing to tell any lie, no matter how outrageous, and roll over its own allies as it went ahead with the bloody invasion of Iraq, at the cost of so many Iraqi and quite a few American lives. In the third year after the attacks on New York and Washington, an Internet-based community of thousands of 9/11 researchers and hundreds of writers using open source material has reached a broad consensus on answers to some of the day's many open questions. Their conclusions are more than disturbing. I shall touch only upon five points, each of which is itself rich enough for hours of discussion, each of which is subject enough for whole books: 1st point. There was an air-defense standdown on Sept. 11th. The world may be full of terrorists who want to kill Americans in their own country, and who have the werewithal to hijack planes, even with the primitive tools of mace, knives and fake bombs. I'm not telling you these kinds of evildoers are not out there! I am perhaps pointing out that they have their uses to another kind of evildoer, in the establishment. And I am pointing out that the actual events of Sept. 11th are impossible to explain without allowing that long-established standard U.S. air defense procedures were completely ignored during almost the entire 110 minutes of the four attacks. That is not something you can achieve with boxcutters and mace. Only a military order to stand down the country's air defenses can explain the failure to intercept the hijacked planes, especially the third attack, which hit the Pentagon at 9:40, an hour and 20 minutes after the original hijacking became known to air traffic control at 8:20. Note that intercept does not mean "shoot down," which would require an additional order. Interception is a standard reconnaissance procedure for errant planes. After the first two attacks at the latest, there was ample time to react to a hijacked plane entering the world's best-protected air space. Washington is ringed by air force bases. Andrews Air Force Base stations jet fighters and these are just 10 miles from the Pentagon. Yet the Pentagon attack was not even intercepted. According to the offiicial story, the alleged pilot, Hani Hanjour, who flunked out of flight school, managed to perform an amazing 270-degree turn as he descended from 8,000 feet directly over the building. He flew the aircraft at ground level and straight into the wing of the Pentagon that had just been renovated to reinforce it against a possible terrorist strike. Which was therefore mostly empty. Beyond that: What could possibly explain the coincidence that the U.S. military was running scheduled wargames to rehearse domestic hijackings on the morning of Sept. 11th itself? Among the wargames of Sept. 11, 2001 was a planned fire-drill evacuation, that very morning, of the nation's satellite surveillance center, the NRO. The rehearsed scenario was that NRO headquarters would be hit by a kamikaze craft! What we know about the 9/11 wargames is all open source material. The source is the U.S. military itself. 2nd point. The leading members of U.S. chain of command reacted in an inexplicable fashion that morning, as though they were simply letting the attacks proceed. During the first 75 minutes of the attacks, George W. Bush and his security entourage dawdled from his hotel on through a meaningless photo opportunity at a Florida elementary school, which was carried live on TV. Donald Rumsfeld failed to show up in the Pentagon situation room because, he says, he was busy making phone calls, until after the building was hit. The acting Chairman of the Joint Chiefs of Staff, General Myers, claims he thought the first crash was an accident. He said that he only heard that America was under attack after leaving his meeting with a senator, by which time the Pentagon had been hit. How is it possible that no one brought word to the commander of the nation's military forces until after the Pentagon attack? 3rd point. Remember the anthrax attacks? In the month of Oct. 2001, these caused massive hysteria and drowned out all other stories. No perpetrator has been identified, and today the attacks are as good as forgotten. Wonder why? The simplest and most compelling explanation for the anthrax attacks, based in a powerful evidentiary case, is that these were an inside job. The anthrax did not come from Iraq, or Afghanistan. It originated in the bioweapons labs at Fort Dietrick, Maryland. The timing, the precise targeting and the known circumstantial evidence all point to a covert operation designed to intimidate the mass media, the Congress and the opposition. Anyone remember which two Senators were first to get the anthrax? (Explain: Daschle and Leahy.) The anthrax mailings effectively initiated the formal dismantling of democracy, by contributing directly to the passage of the unconstitutional USA PATRIOT Act. This of course was followed within weeks by the announcement of the Shadow Government, the creation of Homeland Security, the color-coded system of terrorizing the population, and many other repressive measures. 4th point. The historical record. The networks around Osama Binladin (his proper family name in English) have in the past been used as U.S intelligence assets, from Afghanistan in the 1980s to Kosovo in the late 1990s. They have in the past gladly taken the credit for acts they obviously did not commit, like the 1993 downing of American helicopters in Somalia. Much evidence suggests that links between the Qaeda network and U.S. and British intelligence networks remain. That subject has already filled several academic books' worth. By the way, one thing we really do not need to look for in addition is the evidence of the longstanding financial links between the Bush family and the Binladin family fortunes. Those are a matter of public record. Everyone here know the Carlyle Group, or anything about James Bath, the Bin Laden family, and George Bush? If you don't, you'd better look it up. Related to the fourth point, History teaches that states in need of an enemy to justify hardline measures often consider, allow or pursue orchestrated terror on their own people. This has happened at different times in Italy, in Russia, in Germany, all around the world. Similarly, almost all foreign wars are known to have been initiated with lies. The United States is by no means unique, in either type of staged incident. Among the well-known American examples, we can point to the non-existent Gulf of Tonkin "incident." This was used in 1964-65 to launch the American phase of the Vietnam war. Two years earlier, in 1962, the U.S. Joint Chiefs of Staff signed off on a plan they called Operation Northwoods. This proposed that the U.S. military would stage terror attacks in the United States and blame them on Cuba. The plan was rejected by President Kennedy. I'll leave it up to you to decide what happened to him. (I should note that the most detailed of the Northwoods scenarios involved sending out a robot plane, blowing it up near Cuba, and then claiming it was full of American civilians who would have actually been dummy identities.) The 5th and final point about Sept. 11th, for today. There is a 9/11 Coverup. A cursory examination of the ongoing 9/11 Commission, which I prefer to call the Kean Commission after its chairman, and a look at all official U.S. investigations of 9/11 to date suffices to show serious conflicts of interest on the part of the investigators. I shall point out one of the most obvious conflicts of interest right now: Who here knows who Condoleeza Rice is? ("Good. Thank you.") Okay. Who here has ever heard the name Philip Zelikow. Who knows Philip Zelikow? (Show of hands. Explain Zelikow-Rice connection: As executive director of the Kean Commission, Zelikow is responsible for framing the agenda. He acts as chief of the research staff and determines what evidence the commission considers. In the late 1980s, she and Zelikow worked with each other on George H.W. Bush's national security staff. Zelikow and Rice co-authored a 1999 book about their experiences in the first Bush White House, "Germany Unified and Europe Transformed: A Study in Statecraft." The book's co-authors present "a detailed and fascinating account of behind-the-scenes discussions and deliberations" during the fall of the Soviet empire, according to Library Journal. Zelikow also served alongside Rice in 2001 as a member of the George W. Bush administration transition team. Earlier this year, he delivered secret testimony about that experience to the ten members of the Kean Commission, all of whom are former elected officials or high-level officers of the U.S. government. Imagine if the judge's main research advisor in a trial was a close associate of the star witness. Imagine if he testified as a witness to the case, behind closed doors. A parallel situation has arisen with Zelikow in the role of the court assistant and Rice as the star witness. Zelikow's evident conflicts of interest prompted Sept. 11 family members to call for his resignation months ago. "It is apparent that Dr. Zelikow should never have been permitted to be Executive Staff Director of the Commission," says the Family Steering Committee, a group of twelve Sept. 11 relatives who have been observing the government's 9/11 investigations.) You would have had to follow the Commission hearings carefully, but if you did, you would be aware of the revealing and largely unreported clashes among them. One of the commissioners, Max Cleland, resigned last November, declaring the whole process a whitewash. He said, "Bush is scamming America." The next week, this same Bush appointed Cleland to head the Export-Import Bank, presumably so that he would shut up. (Who here was aware of that? Show of hands.) The investigations have met with constant obstruction and stonewalling by the administration. Most important, the official investigators have shown a steadfast refusal to consider the evidence of advance knowledge or advance preparation for the attacks on the part of U.S. government officials and prominent U.S. citizens. The intelligence agencies of twelve countries issued high-level and specific advance warnings relating to aspects of the Sept. 11th attacks. Many individuals have said they received specific warnings in advance, from Mayor Willie Brown of San Francisco to U.S. attorney David Schippers, to a string of confirmed statements from prisoners in three countries. There is strong evidence of insider trading in many international financial centers, meaning speculation by people who acted to profit from specific foreknowledge of the attacks and their targets. And the supposed investigators generally do not even acknowledge these stories, either to confirm or to deny. They do not trace the warnings, they do not follow the money back to its sources. In other words, we see all the signs of a coverup. A whitewash. Recall that the original choice to run the "Kean Commission" - which by the way is holding its next public hearings in New York City at the New School, on May 18th - was none other than Henry Kissinger. That name alone should suffice to set off alarms. (Kissinger is under investigation in several countries for his alleged involvement in Nixon-era crimes against humanity in Chile and Indochina.) I shall only mention the literally hundreds of other indications that the official story of 9/11 is a farce. Just look at the tales we have been fed about the alleged hijackers and the evidentiary trail meant to establish their guilt, and these dissolve into an absurd morass. The man we know as Mohammed Atta was all over the map and the official FBI timeline of his activities is in conflict with dozens of witness statements about his movements in Florida and elsewhere. Only one reporter has really bothered to follow that story, Daniel Hopsicker, and you've probably never heard of him. Why? Where is the press? We are told the government found the intact passport of one of the hijackers on the ground near the World Trade Center, on Sept. 11th itself, during all that panic. I call that the Magic Passport. You probably all remember that the government claimed right after the attacks to have figured out who the hijackers were after finding a Koran in a van. We were also told that investigators went to a motel where the hijackers stayed two weeks earlier, and just happened to discover incriminating documents in the room. Two weeks later! Doesn't this motel have a cleaning lady? The State Department translation of the so-called Osama confession video was falsified, as a German TV news team has amply demonstrated. The video itself appears to be a fake, as anyone can see, and the whole story around it is fishy. And on, and on. Coincidence is one thing, but how do you explain that all the coincidences point in the same direction? Almost all of the open questions about 9/11 demand that we make that quarter-turn towards considering the complicity of our own government in the attacks. Any honest look at the confirmable and circumstantial open-source evidence leads that way. Can we afford to ignore this? Across the nation, a 9/11 Truth movement is arising, with the ambitious vision of taking the dangerous ideological weapon of 9/11 out of the hands of those who have abused it, and using it instead as a key to unlock the door to the hidden truths of U.S. and world politics. Like nothing else before it, I believe it has the potential to unite all the many alternative culture and opposition currents seeking a transformation of our society. This not only about justice for the victims of 9/11. This is about waking up Americans to the reality of the system they have lived in and supported all these years, to their own self-deceptions. This is about Truth as the great unifier, the first principle of a real democracy. How can you make a choice, without knowing where you stand? Everyone seeks peace and justice. But without truth and freedom, they don't know where they stand, and they can't choose their path. They are nowhere. Do we race against the clock? In a long series of statements, most of the leading members of the administration and many influential insider analysts have practically guaranteed that the next, even more devastating terror attack on the United States is coming in 2004, before the election, which is in exactly six months. Retired General Tommy Franks has gone on record saying that a new 9/11 would result in the suspension of the Constitution and military rule in the United States. So I guess he has nominated himself for the future junta. A number of U.S. agencies like FEMA have spent decades preparing the apparatus considered necessary for such a contingency. They have forever trained and rehearsed for martial law in the United States. FEMA is now at the center of the ominous new Homeland Security Department. The general who failed as the head of NORAD on Sept. 11th, Eberhard, was promoted. He now heads the new Northern Command, the military force that will be imposing military rule in the United States, if the plans were to be activated, perhaps after a second 9/11 - activated in violation of the Posse Comitatus Act, the Constitution, and the laws of man and God, the real one. The choice Americans face in 2004 is not that between Democrats and Republicans, neither of whom can be relied upon to protect the Constitution in its hour of crisis unless there is overwhelming popular pressure in its defense. The choice Americans face is between Republic and Empire, or if you prefer, between democracy and fascism, between independence and feudalism. That choice will not be made simply at the ballot box, or by the new, obviously compromised electronic voting machines. The choice is in our hearts and minds - in what we dare say to our compatriots, to our family and friends - in what we buy and sell, in how we invest our money, if we have any to invest, in whether we allow it to be spent on our behalf - and in whether or not we are willing to put ourselves on the line in the defense of liberty. Thank you. Biographical Note Nicholas Levis is a writer from New York City. He is co-author and editor of Working for the Enemy. Ford, General Motors and Forced Labor in Germany during the Second World War, a classic case study in how corporations collaborate with tyranny for profit. He lived in Germany for 14 years, working as a translator with a dozen books to his credit, among them Sandro Bocola's classic textbook The Art of Modernism. For most New Yorkers, Sept. 11th inspired a fanatic desire for payback, and Levis was no different. But soon it became obvious that the official story of the day's events made no sense, and 9/11 was being exploited by an unscrupulous cabal to justify their own crusade of war and plunder. So he took up a new calling as a researcher of that day's unanswered questions, and as a hyperactive organizer within what came to be known as the 9/11 Truth Movement. Last year, Levis co-founded American Voices Abroad, a coalition of U.S. expatriates' antiwar groups in Europe, and co-organized the largest 9/11 research conference until that time, on Sept. 7, 2003 under the title, "Unanswered Questions - Demanding Answers." Covered heavily in the European media, this controversial event featured former Congresswoman Cynthia McKinney as the keynote speaker, alongside leading Ameriacan, German and Italian researchers of Sept. 11th and other false-flag terror events. Levis is now one among many activists within the U.S. campaigns for 9/11 Truth in 2004.
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