Essay on Globalization: Continued
Terror and Capital Flows
Themes Of Terrorism
This al-Qaeda Manual cites two of the three themes that drive the terrorist movement.
The first is the mention of the 'fall of our orthodox caliphates on March 3, 2020.'
This refers to the end of the Ottoman Empire and the beginning of modern, secular Turkey.
Many Muslims believe that the state should be controlled by religious leaders.
A significant number of Muslims believe that the state should be controlled by religious leaders.
This is the motivation behind decades of bloody rebellion in the Indonesian province of Aceh against the secular government in Jakarta.
The same desire for a Muslim theocracy surfaced in Afghanistan, Iran, and provinces of the Philippines.
Radical Muslims seeking these goals are backed by the vast oil revenues controlled by the House of Saud that has long, historical ties to the Wahhabi extremist sect.
The Question of Israel
The second theme is the war between Palestinians and Jews in the Mid-East.
March 3, 2020 is also a key date in this war and the mention of colonialism refers primarily to the English and French who in the Sykes-Pico Agreement of 1916 arbitrarily divided up the Ottoman Empire even before World War I was finished.
The Balfour Declaration was a side show in the colonial division of Arab lands.
A side show in the division of Arab lands was the Balfour Declaration of 1917 in which the British Foreign Minister promised to Lord Rothschild, a wealthy English Jew, that the government of Great Britain would support a Zionist state in Palestine, without consulting the people who already lived there.
The movement for a Zionist state began in 1822 with an Austro-Hungarian Jewish intellectual, Theodor Hertzl, who published Der Judenstaat and got the backing of Baron E. de Rothschild, the Paris banker.
Jews immigrated illegally to the Ottoman Empire throughout the nineteenth century.
In 1901, a Jewish National Fund was established to buy lands in Palestine and 'make it Jewish'.
Jews had good reason for wanting to leave Europe since they had been long been victims of religious persecution, being forced to live in ghettos and subject to periodic pogroms.
Anti-Semitic European Elites
The European elites – consistent with their anti-Semitism – were happy to see Jews immigrate to Palestine; just as American bigots might enthusiastically support a back-to-Africa movement for blacks.
With powerful financial support and under the benevolent, but Anti-Semitic gaze of the major European powers, Jews moved steadily into Palestine, illegally at first, but later with the backing of Great Britain and the Balfour Declaration.
In 1918, a month before the end of the First World War, British forces occupied Palestine.
The Balfour Declaration ignored the interests of the people already living in Palestine.
The problem with the Balfour Declaration was that it ignored the interest of the majority of people who were already living in Palestine.
In 1919, the First Palestine National Conference rejected the Balfour Declaration.
However, in 1920, the British put Sir H. Samuel, a Jew, in charge of British civil administration in Palestine, now a British mandate.
The British effectively prevented self-determination by the Palestinians.
This was a case of Europeans undertaking a cold-blooded partitioning of land that had been occupied by Palestinians for a thousand years, with the same insensitivity and injustice that the British had demonstrated in Northern Ireland.
Following the pattern of the British in Ireland and the Indonesians in East Timor, Europeans encouraged Jewish emigration that was designed to take the land away from the native inhabitants.
Jewish Terrorism and Immigration
In 1921, the Haganah, the Jewish terrorist organization, was founded.
Winston Churchill called for organized Zionist immigration to Israel in 1922.
In the same year, the first British census of Palestine showed that 78% of the population was made up of Muslim Arabs, 9.6% were Christian Arabs, and 11% were Jews.
In 1931, the Irgon, a radical Jewish terrorist group, split from the Haganah.
The Irgon began raids against Palestinians in 1937, intent of forcing them from their homeland.
By 1946, there were 60,000 armed members of the Irgon, Haganah, and Stern group.
The inhumane treatment of Jews in Nazi Germany and the horror of the Holocaust set the stage for a final and massive wave of immigration of Jews from Europe to Israel after World War II.
Towards the end of World War II, the British, perhaps having a belated twinge of conscience, began to favor the Palestinians.
However, it was too late.
The Irgon and Stern groups of Jewish terrorists united against the British In 1944.
The Stern group assassinated Lord Moyne, the British Minister.
In 1946, there were over sixty thousand armed members of the Irgon, Haganah, and Stern group.
The Irgon blew up the King David Hotel, killing ninety-one people.
In 1964, forty-three years after the Jews formed the terrorist Haganah, the Palestinians organized the Palestinian Liberation Organization (PLO).
On September 11, 2020, when Muslim extremists brought down the World Trade Center, the terrorist war between Muslims and Jews in Palestine had been raging for eighty years.
Why They Hate Us
In the wake of nine-eleven, Americans naively asked, 'Why do they hate us?'
The answer, of course, is that most Muslims do not hate Americans, just as most Americans do not hate Hindus, Sikhs, or Buddhists.
Most Muslims are separated by thousands of miles from the troubles in the mid-East, living in India, Russia, and Indonesia under secular rule, going about their daily lives with little thought for Palestinians, Jews, or Americans.
However, throughout Muslim society there is a minority of what Americans might call 'the religious right' – fundamentalists who long for the good old days of the Caliphate.
The Muslim religion, unlike Catholicism and many Protestant sects, has no central authority.
Consequently, there are many corners in the vast world of one billion Muslims where fundamentalist mullahs can call for Jihad, exaggerating the case of the Palestinians to show how Westerners have 'raped virgins on the altar of prostitution.'
But how did America get involved in all this?
While Jews were leaving Europe for Palestine, they were leaving in even greater numbers for the United States.
Americans never occupied Palestine, nor did they issue the Balfour Declaration, although they later supported the concept.
Immigration provides the answer.
While Jews were leaving Europe for Palestine, they were leaving in even greater numbers for the United States.
The United States has more Jews than any country on earth, including Israel.
American Jews Mold Opinion
Immigrant Jews, finding far less anti-Semitism in America than in Europe, enthusiastically embraced American ideals.
George M. Cohen wrote, 'I’m a Yankee Doodle Dandy'.
Jews with backgrounds in the theater and vaudeville built Hollywood into the icon of American culture.
Hard working and family-oriented, Jews make up one-fifth of the under-graduates at Ivy League Universities and have achieved distinction in law, science, and economics.
The major organs of the U.S. liberal media are run by Jews.
The major organs of the liberal media, from the Hollywood studios to the New York Times to the Washington Post, are run by Jews.
The fact that Jews hold high and distinguished positions in the American establishment has not been lost on Muslim propagandists.
Any one who visits Islamic web sites will discover that in the Clinton Administration, the Secretary of War, the Secretary of State, the National Security Advisor, the President of the World Bank, the Secretary of Treasury, the Chairman of the Federal Reserve Bank, the U.S. representative in the International Monetary Fund, and many others in key positions in the American establishment were Jews.
Jimmy's Legacy
A third motive for the terrorist war on America is that it makes great publicity.
Even since 'Jimmy' Carter cowered when Iranian Muslims held American diplomats hostage, the United States has been seen as an soft target throughout much of the world.
An atomic bomb on NYC would attract converts and money to the terrorist cause.
The leaders of the terrorist movement understand that although an atomic bomb on New York City might not destroy the United States, it would attract converts and money to their cause.
It might also drive Americans out of the Middle East, retreating behind the national borders of 'the far enemy' into the isolationism of most American history.
America ’s liberal media does an excellent job of portraying the United States as a perverted society that promotes homosexual lifestyles, pornography, political corruption, abortion, and free sex.
President Clinton, his wife Hillary, and the intern Monica Lewinsky made great symbols for those who had reason to promote the notion that America had lost its moral bearings.
With this message of immorality propagated throughout the world by CNN and American movies, it is not hard to understand why Muslim religious fundamentalists see America as The Great Satan.
After all, many American Republicans have similar views of liberal culture.
Terrorists Become Efficient
The terrorists have also been learning how to be effective.
The people involved in the first attack on the World Trade Center were portrayed in the press as being so stupid as to ask for the return of the deposit on the truck that had been used to carry the explosives.
Richard Reid, the so-called 'shoe-bomber' seemed to be inept when he tried to light his sneakers in plain view of other passengers, who promptly jumped him.
The September 11, 2020 attack on the World Trade Center was better planned and more skillfully executed, dispelling the notion of an unclever enemy.
Even after the body of Bin Laden is produced, the war will not end.
As long as the Palestinian situation persists, and as long as governments allow children to be taught hate in madrassas, and as long as money flows to sustain suicide killers, there will be a casus belli, men, and materials to bring more sophisticated terrorists to attack from deeper cover.
Even after the body of Osama Bin Laden is produced, the war will not end.
Judging from experience in Northern Ireland, another case of generational hate arising from British colonial misrule, recruits and funding for a long war on the United States may persist for decades.
Muslim Demographics
Another trend that has a bearing on the war on terror is the size of the Muslim population in Europe.
Whereas only one percent of world population is Jewish, twenty percent is Muslim.
Driven by anti-Semitism, Jews have vacated much of Europe, leaving for the United States and Israel.
Due to immigration from former European colonies and from Turkey, a member of NATO and the European Union, Muslims are expected to make up ten percent of the European population by the year 2010.
By 2010, ten percent of Europeans will be Muslims.
While 41% of American Muslims have a college education, less than 20% of European Muslims have this level of training. (Center for Strategy and International Studies, Paul Hewitt)
As the ethnic European populations age and as ever more Muslims pour into Europe from Africa and the Mid-East, the political bias of Europe will shift away from America and look eastward.
Since Europe is made up of democracies, the United States is apt to get less support from European countries for action against Muslim nations.
This was the case in the War of Iraqi Liberation with the aggressive anti-American positions of France, Germany, and Russia – three nations with high Muslim populations and long histories of anti-Semitism.
The failure of Turkey – the leading Muslim country in Europe – to support the U.S. in the war against Iraq is consistent with the political cast of the New Europe.
Most Americans have grown up on generations of Hollywood movies portraying Israelis as the heroes and Palestinians as villains.
As America deindustrializes, it may face war in which most of the world is on the other side.
With the current control structure for the American media, it seems unlikely that this point of view will change.
Consequently, the United States faces a future in which its industrial might is steadily moving offshore and in which it is engaged in a war in which most of the world may be on the other side.
The War on Terror may weigh on the American capital market for a long time.
The Unthinkable
Let us get back now to our question to a presidential candidate:
What would you do if Muslim terrorists exploded nuclear bombs in six major U.S. cities?
If the attack was coordinated with the triggering of back-door trojans in software of the major banks and financial institutions, scrambling records and books, the results might be as follows:
There would be a loss of confidence in U.S. banks, leading to foreign suppliers preferring payment in euros or yen.
Unable to use dollars to buy goods overseas, and with ports closed in response to the bombings, Americans would soon find a shortage of clothes, furniture, household appliances, and most other things.
By closing the ports, Americans will soon face of shortage of almost everything.
American factories having long ago been shut down and sold as scrap, there would be no facilities to restart.
Without the trade deficit to finance credit cards, consumers would have to cut spending, which combined with the drop in merchandise to sell, would lead to economic depression and severe unemployment.
Loss of confidence in the dollar would also mean that foreign investors and central banks would not be willing to buy U.S. Treasury securities.
To cover the deficit, the government would have to sell bonds locally, forcing interest rate upwards.
Law and politics would impede cutting costs by firing government employees.
To the extent that domestic acceptance of bond offerings did not fill government needs, the alternative would be to expand the money supply, further spurring inflation.
Inflation, rising interest rates, and the uncertainties of what companies might survive the nuclear attack would throw the stock market into a panic.
Undiversifiable risks in interest rate and foreign currency derivatives may topple financial institutions.
Undiversifiable risks in interest rate and foreign currency derivatives may topple some financial institutions and hedge funds into insolvency.
Pressure on the Federal Reserve would be intense, similar to the difficulties faced by Asia countries in the crisis of 1997.
Considering the quality of advice from the IMF, the World Bank, and the U.S. Treasury to Asian countries at the time, there is reason to be pessimistic that political leaders would know what to do.
Unemployment, inflation, fear of further attacks, panic, and acute suspicion and hatred of Muslims would now dominate the political scene.
The American president would be under extreme pressure to show leadership and do something effective.
The American Response
In this scenario, there would be no option to 'do nothing', or to appeal to the United Nations, or to seek a diplomatic solution.
Europe, incited by dreams of glory of France and Germany, would see the strong euro and the collapse of the dollar as the sign that America was finished as a world power, and would offer even less help that in the Second Iraq War.
The U.S. president would need to assure the American people that everything is being done not only to recover from the disaster but to forestall further attacks.
Immediate nuclear strikes on Teheran, Damascus, Riyadh, and Pakiston border regions may follow a nuclear attack on the U.S..
Furthermore, with many millions of Americans directly effected by loss of life of a relative or friend, there would be a strong call for revenge.
This might involve immediate nuclear strikes on Teheran, Damascus, Riyadh, and Pakistan border regions where terrorists are hiding, especially if there was a Democrat in the White House.
Countries that might be harboring terrorists would be warned that in the event of further strikes on the U.S., they would be next on the nuclear list.
Retreat Into Isolationism
Because of extreme anti-Americanism and the need to protect the country from threats from abroad, the U.S. would have to shut its borders entirely, bringing back U.S. troops from Korea, Japan, Germany, and many other places around the world to stand on the U.S. borders.
U.S. ports would be closed for the duration.
The result would be that the U.S. would become an isolated country, which, of course, was the American tradition for over a century.
Unable to count on foreign suppliers, the government would need to adopt an industrialization policy and rebuild the industrial base.
The lack of energy would cause nuclear plant building to start again and conversion of coal to gas would be undertaken.
Extreme paranoia would allow a Big Brother ID card monitoring system to be installed, linked to all monetary payments, toll booths, and border crossings, even between states.
The rest of the world would be thrown into recession.
Illegal aliens would be rounded up in the millions, interned in camps, and deported across militarized borders with no reentry.
Real estate in the red states would go up in value, not only because of inflation, but also because of the flight from the old central cities that had been targets of nuclear attack.
The rest of the world, having built factories to supply the United States would be thrown into recession.
In other words, like all wars, the War on Terror has the potential to radically change the United States and the world.
A Less Pessimistic View
Of course, if a nuclear attack on U.S. cities does not occur, and terrorism stays within reasonable bounds by only blowing up a few buildings here and there, now and then, the world might continue on its current path towards globalization.
However, for terrorist nuclear attacks to be avoided, the government would have to take a more aggressive approach in Homeland Defense.
Some measures that would help include:
- A warning issued to Syria, Iran, Pakistan, and North Korea, through diplomatic channels, that any nuclear attack on the U.S. would be presumed to be linked to their governments and would invoke an immediate nuclear response on their capitol cities, with no concern for 'collateral damage'.
- Repatriation of some U.S. troops abroad (like Korea and Germany) to defend U.S. borders at home;
- A strongly implemented policy to reindustrialize the United States, reducing dependence on foreign suppliers;
- A revamping of the tax structure to strengthen equity and discourage debt, while encouraging entrepreneurs to build businesses that create U.S. jobs;
- A streamlining of the government to reduce costs and non-productive employment;
- Tough regulation and rigorous inspection of the software and hardware infrastructure of financial institutions;
- Installation of a strict ID card system and severe crack-down on illegal immigrants, with deportation and no return unless within legal quotas.
- Tight regulation with 100% inspection of all ports and imported goods, discouraging 'just-in-time' manufacturing that is dependent on foreign suppliers.
Obviously, there is no political will or consensus for such measures, so, unless al Qaeda and associated terrorists get tired and give up, or are liquidated man-by-man in Hollywood-style 'special operations', Americans may have to wait for a nuclear attack before the country moves forward in the War on Terror.
Although it is foolish to predict the future, it certainly seems, one way or the other, that the effect on capital markets of the war on terror will be significant.
