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« Reply #5355 on: Mar 27, 2013, 07:50 AM »

In the USA...

Originally published Tuesday, March 26, 2013 at 4:21 AM   

High court hears case on federal benefits for gays

In the second of back-to-back gay marriage cases, the Supreme Court is turning to a constitutional challenge to the law that prevents legally married gay Americans from collecting federal benefits generally available to straight married couples.

By MARK SHERMAN

Associated Press
WASHINGTON —

In the second of back-to-back gay marriage cases, the Supreme Court is turning to a constitutional challenge to the law that prevents legally married gay Americans from collecting federal benefits generally available to straight married couples.

A section of the 1996 Defense of Marriage Act says marriage may only be a relationship between a man and a woman for purposes of federal law, regardless of state laws that allow same-sex marriage.

Lower federal courts have struck down the measure, and now the justices, in nearly two hours of scheduled argument Wednesday, will consider whether to follow suit.

The DOMA argument follows Tuesday's case over California's ban on same-sex marriage, a case in which the justices indicated they might avoid a major national ruling on whether America's gays and lesbians have a right to marry. Even without a significant ruling, the court appeared headed for a resolution that would mean the resumption of gay and lesbian weddings in California.

Marital status is relevant in more than 1,100 federal laws that include estate taxes, Social Security survivor benefits and health benefits for federal employees. Lawsuits around the country have led four federal district courts and two appeals courts to strike down the law's Section 3, which defines marriage. In 2011, the Obama administration abandoned its defense of the law but continues to enforce it. House Republicans are now defending DOMA in the courts.

Same-sex marriage is legal in nine states and the District of Columbia. The states are Connecticut, Iowa, Maine, Maryland, Massachusetts, New Hampshire, New York, Vermont and Washington. It also was legal in California for less than five months in 2008.

The justices chose for their review the case of Edith Windsor, 83, of New York, who sued to challenge a $363,000 federal estate tax bill after her partner of 44 years died in 2009.

Windsor, who goes by Edie, married Thea Spyer in 2007 in Canada after doctors told them that Spyer would not live much longer. She suffered from multiple sclerosis for many years. Spyer left everything she had to Windsor.

There is no dispute that if Windsor had been married to a man, her estate tax bill would have been zero.

The U.S. 2nd Circuit Court of Appeals in New York agreed with a district judge that the provision of DOMA deprived Windsor of the constitutional guarantee of equal protection of the law.

Like the Proposition 8 case from California, Windsor's lawsuit could falter on a legal technicality without a definitive ruling from the high court.

The House Republicans, the Obama administration and a lawyer appointed by the court especially to argue the issue were to spend the first 50 minutes Wednesday discussing whether the House Republican leadership can defend the law in court because the administration decided not to, and whether the administration forfeited its right to participate in the case because it changed its position and now argues that the provision is unconstitutional.

If the Supreme Court finds that it does not have the authority to hear the case, Windsor probably would still get her refund because she won in the lower courts. But there would be no definitive decision about the law from the nation's highest court, and it would remain on the books.

On Tuesday, the justices weighed a fundamental issue: Does the Constitution require that people be allowed to marry whom they choose, regardless of either partner's gender? The fact that the question was in front of the Supreme Court at all was startling, given that no state recognized same-sex unions before 2003 and 40 states still don't allow them.

But it was clear from the start of the 80-minute argument in a packed courtroom that the justices, including some liberals who seemed open to gay marriage, had doubts about whether they should even be hearing the challenge to California's Proposition 8, the state's voter-approved gay marriage ban.

Justice Anthony Kennedy, the potentially decisive vote on a closely divided court, suggested the justices could dismiss the case with no ruling at all.

Such an outcome would almost certainly allow gay marriages to resume in California but would have no impact elsewhere.

There was no majority apparent for any particular outcome, and many doubts were expressed by justices about the arguments advanced by lawyers for the opponents of gay marriage in California, by the supporters and by the Obama administration, which is in favor of same-sex marriage rights. The administration's entry into the case followed President Barack Obama's declaration of support for gay marriage.

On the one hand, Kennedy acknowledged that same-sex unions had only become legal recently in some states, a point stressed repeatedly by Charles Cooper, the lawyer for the defenders of Proposition 8. Cooper said the court should uphold the ban as a valid expression of the people's will and let the vigorous political debate over gay marriage continue.

But Kennedy pressed him also to address the interests of the estimated 40,000 children in California who have same-sex parents.

"They want their parents to have full recognition and full status," Kennedy said. "The voice of those children is important in this case, don't you think?"

Yet when Theodore Olson, the lawyer for two same-sex couples, urged the court to support such marriage rights everywhere, Kennedy feared such a ruling would push the court into "uncharted waters." Olson said the court similarly ventured into the unknown in 1967 when it struck down bans on interracial marriage in 16 states.

Kennedy challenged the accuracy of that comment: He noted that other countries had had interracial marriages for hundreds of years.

The justice also made clear he did not like the rationale of the federal appeals court that struck down Proposition 8, even though it cited earlier opinions in favor of gay rights that Kennedy had written.

That appeals court ruling applied only to California, where same-sex couples briefly had the right to marry before the state's voters in November 2008 adopted Proposition 8, a constitutional amendment that defined marriage as the union of a man and a woman.

Reflecting the high interest in the cases, the court planned to release an audio recording of Wednesday's argument shortly after it concludes, just as it did Tuesday.

************

Round 2: High court weighs federal benefits for gays

In the second of back-to-back gay marriage cases, the Supreme Court is turning to a constitutional challenge to the law that prevents legally married gay Americans from collecting federal benefits generally available to straight married couples.

By MARK SHERMAN
Associated Press

WASHINGTON —

In the second of back-to-back gay marriage cases, the Supreme Court is turning to a constitutional challenge to the law that prevents legally married gay Americans from collecting federal benefits generally available to straight married couples.

A section of the 1996 Defense of Marriage Act says marriage may only be a relationship between a man and a woman for purposes of federal law, regardless of state laws that allow same-sex marriage.

Lower federal courts have struck down the measure, and now the justices, in nearly two hours of scheduled argument Wednesday, will consider whether to follow suit.

A somewhat smaller crowd gathered outside the court Wednesday, mainly gay marriage supporters who held American and rainbow flags. One man wore a rainbow flag as a cape. "Two, four, six, eight, we do not discriminate," a group chanted at one point.

The DOMA argument follows Tuesday's case over California's ban on same-sex marriage, a case in which the justices indicated they might avoid a major national ruling on whether America's gays and lesbians have a right to marry. Even without a significant ruling, the court appeared headed for a resolution that would mean the resumption of gay and lesbian weddings in California.

Marital status is relevant in more than 1,100 federal laws that include estate taxes, Social Security survivor benefits and health benefits for federal employees. Lawsuits around the country have led four federal district courts and two appeals courts to strike down the law's Section 3, which defines marriage. In 2011, the Obama administration abandoned its defense of the law but continues to enforce it. House Republicans are now defending DOMA in the courts.

Same-sex marriage is legal in nine states and the District of Columbia. The states are Connecticut, Iowa, Maine, Maryland, Massachusetts, New Hampshire, New York, Vermont and Washington. It also was legal in California for less than five months in 2008.

The justices chose for their review the case of Edith Windsor, 83, of New York, who sued to challenge a $363,000 federal estate tax bill after her partner of 44 years died in 2009.

Windsor, who goes by Edie, married Thea Spyer in 2007 in Canada after doctors told them that Spyer would not live much longer. She suffered from multiple sclerosis for many years. Spyer left everything she had to Windsor.

There is no dispute that if Windsor had been married to a man, her estate tax bill would have been zero.

The U.S. 2nd Circuit Court of Appeals in New York agreed with a district judge that the provision of DOMA deprived Windsor of the constitutional guarantee of equal protection of the law.

Like the Proposition 8 case from California, Windsor's lawsuit could falter on a legal technicality without a definitive ruling from the high court.

The House Republicans, the Obama administration and a lawyer appointed by the court especially to argue the issue were to spend the first 50 minutes Wednesday discussing whether the House Republican leadership can defend the law in court because the administration decided not to, and whether the administration forfeited its right to participate in the case because it changed its position and now argues that the provision is unconstitutional.

If the Supreme Court finds that it does not have the authority to hear the case, Windsor probably would still get her refund because she won in the lower courts. But there would be no definitive decision about the law from the nation's highest court, and it would remain on the books.

On Tuesday, the justices weighed a fundamental issue: Does the Constitution require that people be allowed to marry whom they choose, regardless of either partner's gender? The fact that the question was in front of the Supreme Court at all was startling, given that no state recognized same-sex unions before 2003 and 40 states still don't allow them.

But it was clear from the start of the 80-minute argument in a packed courtroom that the justices, including some liberals who seemed open to gay marriage, had doubts about whether they should even be hearing the challenge to California's Proposition 8, the state's voter-approved gay marriage ban.

Justice Anthony Kennedy, the potentially decisive vote on a closely divided court, suggested the justices could dismiss the case with no ruling at all.

Such an outcome would almost certainly allow gay marriages to resume in California but would have no impact elsewhere.

There was no majority apparent for any particular outcome, and many doubts were expressed by justices about the arguments advanced by lawyers for the opponents of gay marriage in California, by the supporters and by the Obama administration, which is in favor of same-sex marriage rights. The administration's entry into the case followed President Barack Obama's declaration of support for gay marriage.

On the one hand, Kennedy acknowledged that same-sex unions had only become legal recently in some states, a point stressed repeatedly by Charles Cooper, the lawyer for the defenders of Proposition 8. Cooper said the court should uphold the ban as a valid expression of the people's will and let the vigorous political debate over gay marriage continue.

But Kennedy pressed him also to address the interests of the estimated 40,000 children in California who have same-sex parents.

"They want their parents to have full recognition and full status," Kennedy said. "The voice of those children is important in this case, don't you think?"

Yet when Theodore Olson, the lawyer for two same-sex couples, urged the court to support such marriage rights everywhere, Kennedy feared such a ruling would push the court into "uncharted waters." Olson said the court similarly ventured into the unknown in 1967 when it struck down bans on interracial marriage in 16 states.

Kennedy challenged the accuracy of that comment: He noted that other countries had had interracial marriages for hundreds of years.

The justice also made clear he did not like the rationale of the federal appeals court that struck down Proposition 8, even though it cited earlier opinions in favor of gay rights that Kennedy had written.

That appeals court ruling applied only to California, where same-sex couples briefly had the right to marry before the state's voters in November 2008 adopted Proposition 8, a constitutional amendment that defined marriage as the union of a man and a woman.

Reflecting the high interest in the cases, the court planned to release an audio recording of Wednesday's argument shortly after it concludes, just as it did Tuesday.

*************

Obama to name first female Secret Service chief

By Stephen C. Webster
RawStory
Tuesday, March 26, 2013 15:41 EDT

President Barack Obama is expected to announce on Tuesday that he’s selected a woman to lead the Secret Service, the first in the agency’s history, according to administration officials who spoke to The Washington Post.

Obama will appoint Julia Pierson, 53, to lead the agency that provides protection to U.S. presidents and leading presidential candidates. She’s been with the agency for over 30 years, the Post noted, serving as an agent, then moving up to assistant director and chief of staff.

The Post added that Pierson’s appointment is intended to “bring a culture change” to the Secret Service, which found over a dozen agents embroiled in a prostitution scandal during Obama’s visit to Colombia in 2012.

One of the sex workers at the center of that controversy later told the media that Obama’s advance security team seemed more concerned with partying than ensuring the president’s safety. “These seem like completely stupid, idiotic people,” Dania Londono Suarez told NBC News. “I don’t know how Obama had them in his security force.”

The scandal marred the tenure of former Secret Service Director Mark Sullivan to such an extent that he was forced to resign. He told the Post that Pierson’s appointment is both “historic” and “exciting,” saying he’s sure she is an excellent choice.

***********

March 26, 2013

Founder of Yoga Empire Accused of Misconduct in Suit

By SARA BECK
NYT

A former student has sued Bikram Choudhury, the millionaire founder of a wildly popular yoga franchise, accusing him of sexual harassment, discrimination and defamation.

According to legal documents filed this month in Los Angeles County Superior Court, Sarah Baughn, 28, a Bikram student, teacher and international competitor who lives in San Francisco, said she considered Mr. Choudhury her hero until he made advances toward her during a 2005 teacher training course in Los Angeles.

Ms. Baughn, who was 20 at the time, said she was uncomfortable when she first noticed how other female students would brush his hair, wash his feet and give him massages, but she chalked it up to cultural differences. Then, she says, he offered her his diamond Rolex watch, which she did not accept, and told her he had known her in a past life.

“What should we do about this?” the lawsuit claims Mr. Choudhury said. “I have never felt this way about anyone,” he continued, adding, “Should we make this a relationship?”

Mr. Choudhury opened his first yoga studio in the early 1970s in the basement of a bank building in Beverly Hills, Calif. A national yoga champion from Calcutta, Mr. Choudhury was said to sleep on the studio floor, spurn the advances of women and offer classes by donation only. Then Shirley MacLaine, an early student, gave him some advice.

“She said no American respects anything that’s free,” Mr. Choudhury recalled at the 2012 Bishnu Charan Ghosh Cup, the yoga asana competition named after his guru.

Now, Mr. Choudhury, 67, charges $25 per class, oversees hundreds of studios on six continents, owns several Rolls-Royces and is called “Yoga’s Bad Boy” by Yoga Journal. His copyrighted yoga sequence is practiced in a 105-degree room often nicknamed the torture chamber.

“Sarah dropped out of college to study with Bikram, and every penny she had went to him,” said Mary Shea Hagebols, Ms. Baughn’s lawyer. “She was a true believer and student.”

Ms. Baughn says she rebuffed Mr. Choudhury’s repeated advances and at times tried to redirect his attention to his wife, also a teacher and the founder of USA Yoga, a yoga sports federation with Olympic ambitions. The legal document claims that his advances continued; he is accused of pressing his body against hers while adjusting her posture, whispering sexually charged comments into her ear, ordering her to kiss him in front of other trainees, and assaulting her in a hotel room in Acapulco, Mexico, during a teacher training.

Her lawyer declined to say whether Ms. Baughn ever reported any of these accusations to the police, but she did speak with senior teachers at his Los Angeles-based Yoga College of India. “Sarah wants whatever justice the jury decides so that this never happens again — that’s her primary goal,” Ms. Hagebols said.

Neither Mr. Choudhury nor his wife, Rajashree, who is also being sued for her role in running the business and the teacher training program, could be reached for comment. But a spokeswoman for USA Yoga said the group was confident that the court would determine the truth.

“In the interim,” said the spokeswoman, Rachel Golden, “we believe it is vitally important to continue to support the millions of devoted yoga practitioners around the world in reaping the benefits of their practice.”

Reporting Mr. Choudhury’s behavior to the senior teachers did little good, Ms. Baughn says in the suit. They promised that he was harmless and “innocent, like a child,” she said. Ms. Baughn said she was told that she needed to “separate the man from the teacher” and understand that powerful men were often flirtatious.

“Vulnerability and devotion are big parts of the practice,” said Benjamin Lorr, the author of the memoir “Hellbent: Obsession, Pain, and the Search for Something like Transcendence in Competitive Yoga.” “Bikram creates this mentality that the outside is phony. There is no path but this path, and everything that happens in this path is just a part of your yoga, that you have to learn to be strong and get past it.”

Considered a guru to celebrities like Madonna, George Clooney and Jennifer Aniston, Mr. Choudhury wears a Speedo while presiding over teacher trainings that cost $11,000. Over 300 would-be teachers practice three hours of yoga per day in a sweltering hotel conference room. They also study anatomy, Hindu philosophy and Bikram’s views on life, love and ethics.

Ms. Baughn says her financial investment was one reason she continued to study, practice and teach the series despite her accusations that Mr. Choudhury attempted to sabotage her career and competition results when she repeatedly refused his advances.

“There was a culture of fear,” Mr. Lorr said of the Bikram teacher trainings he experienced, where he tried to interview other students. “No one really wanted to go on the record with me. They thought they would lose their certificates, that all the hard work and money they put into it would be taken away.”

Some Bikram studio owners are wondering how to confront the accusations.

Tricia Donegan, the owner of Bikram Yoga on the Lower East Side of Manhattan, explained that some students did not even know that Bikram was an actual person.

“Bikram’s name may be on the door,” she said, “but my particular space is a safe haven.”

************

March 26, 2013

New Mexico Farmers Seek ‘Priority Call’ as Drought Persists

By FELICITY BARRINGER
NYT

CARLSBAD, N.M. — Just after the local water board announced this month that its farmers would get only one-tenth of their normal water allotment this year, Ronnie Walterscheid, 53, stood up and called on his elected representatives to declare a water war on their upstream neighbors.

“It’s always been about us giving up,” Mr. Walterscheid said, to nods. “I say we push back hard right now.”

The drought-fueled anger of southeastern New Mexico’s farmers and ranchers is boiling, and there is nowhere near enough water in the desiccated Pecos River to cool it down. Roswell, about 75 miles to the north, has somewhat more water available and so is the focus of intense resentment here. Mr. Walterscheid and others believe that Roswell’s artesian wells reduce Carlsbad’s surface water.

For decades, the regional status quo meant the northerners pumped groundwater and the southerners piped surface water. Now, amid the worst drought on record, some in Carlsbad say they must upend the status quo to survive. They want to make what is known as a priority call on the Pecos River.

A priority call, an exceedingly rare maneuver, is the nuclear option in the world of water. Such a call would try to force the state to return to what had been the basic principle of water distribution in the West: the lands whose owners first used the water — in most cases farmland — get first call on it in times of scarcity. Big industries can be losers; small farmers winners.

The threat of such a move reflects the political impact of the droughts that are becoming the new normal in the West. “A call on the river is a call for a shakeout,” explained Daniel McCool, a University of Utah political scientist and author of “River Republic: The Fall and Rise of America’s Rivers.”

“It’s not going to be farmers versus environmentalists or liberals versus conservatives,” he said. “It’s going to be the people who have water versus the people who don’t.” And, he said, the have-nots will outnumber the haves.

Dudley Jones, the manager for the Carlsbad Irrigation District said that water law and allocation practice have long diverged. “We have it in the state Constitution: First in time, first in right. But that’s not how it’s practiced.” In New Mexico’s political pecking order, his alfalfa farmers, despite senior priority rights dating back 100 years, have little clout. The state water authorities, he said, “are not going to cut out the city.”

“They’re not going to cut out the dairy industry,” he added. “They’re not going to cut off the oil and gas industry, because that’s economic development. So we’re left with a dilemma — the New Mexico water dilemma.”

A priority call, said Dr. McCool, “will glaringly demonstrate how unfair, how anachronistic the whole water law edifice is.”

He added, “The all-or-nothing dynamic of prior appropriation instantly sets up conflict. I get all of mine, and you get nothing.”

Despite the support Mr. Walterscheid got from two of the Carlsbad Irrigation District’s five members, however, the March 12 meeting produced not a priority call, but an ultimatum: The Legislature should give Carlsbad $2.5 million to tide it over, or the water district will make the call and start a traumatic legal and scientific battle.

The prior appropriation system on the Pecos has its beginnings in the late 19th century. Its waters flow about 925 miles from the Sangre de Cristo Mountains in northern New Mexico, ending up in the Rio Grande in Texas. It has been a focus of conflict. Texas, saying upstream users were taking its share, won a 1987 Supreme Court ruling guaranteeing deliveries under the Pecos River Compact.

After the ruling, which was signed by the feuding water districts, Roswell took steps to conserve water, including putting meters on wells, limiting withdrawals, allowing five-year averaging of water use and buying out some farmers. At the Pecos Valley Artesian Conservancy District in Roswell, officials take pride in this foresight and maintain that they are not cheating Carlsbad.

“If we turned off every one of our pumps today, they wouldn’t see any more water,” said Aron Balok, the district’s manager. Nonetheless, the bounty of the Roswell-Artesia aquifer, which has produced a robust economy, including abundant dairies, an oil refinery and the West’s biggest mozzarella plant, gives rise to “just plain jealousy” in Carlsbad, he said.

“If the priority call were executed today,” Mr. Balok said, “the refinery would shut down. The cheese plant would shut down. The dairies would shut down. To what end? It wouldn’t make water appear.” The agreement made to settle the dispute with Texas was supposed to stop such brinkmanship. But, he said, “Nobody ever foresaw it being this dry for this long.”

How dry is it? In 2012, parts of the riverbed were dry for 77 days, said Mike Hamman, the area manager for the federal Bureau of Reclamation in Albuquerque. In 2011, with the drought sending feed prices up, the Clovis Livestock auction house, the region’s biggest, sold 144,000 head of cattle, 20 percent above average. “Some herds have sold out,” said the president, Charlie Rogers. Most ranchers have reduced their herds to 25 percent of their previous size, he said. Hay, he said, costs too much.

Higher prices, however, did not offset the losses that hay farmers like Mark Weems and Billy Grandi in Carlsbad suffered when they could not water their fields. Mr. Weems said he had to sell 22 acres to make payments on his farm and equipment. The buyer: an oil-related company that wanted the water rights.

As for Brantley Lake, the nearest reservoir, “Two months ago it looked like you could drive a four-wheeler across it,” Mr. Weems said. Mr. Grandi added, “If the drought continues, a lot of farmers will just have to sell out.”

Mr. Hamman understands that fear. “If indeed we are moving into a new climate regime that is going to limit the ability to continue the status quo,” he said “we may have to do something different — reallocate the system, or make adjustments to existing settlements.”

The climate and the economy on which existing compacts were based may have fundamentally changed. In the West, “the 1 percent of the economy that is farming takes close to 80 percent of the water,” Dr. McCool said. The Pecos feud, he said, is a prelude to wars on rivers like the Colorado, which provides water to more than 20 million people. A recent federal study showed that the Colorado will not have enough water to satisfy existing claims.

In a shakeout, farmers cannot prevail, Dr. McCool argued. “Let’s see, we could dry up some hay farms or we could dry up Las Vegas. Which one is it going to be? It’s going to be the new economy of the West with the focus on recreation and tourism and hunting.”

“There will be farming ghost towns,” he said.

**************

Customers Abandon Wal-Mart As Their Treatment of Labor Wreaks Havoc on Sales

By: Sarah Jones
Mar. 26th, 2013
PolitcusUSA

Wal-Mart’s infamously poor treatment of labor is starting to negatively impact its bottom line as customers abandon the superchain’s unstocked shelves, disorganized stores, and long waits for help.

Earlier this year, Wal-Mart’s low sales made the news, and then reports surfaced about their inability to keep the shelves stocked. Bloomberg reports that things are only getting worse for Wal-Mart:

    Last month, Wal-Mart placed last among department and discount stores in the American Customer Satisfaction Index, the sixth year in a row the company had either tied or taken the last spot…

    Wal-Mart is entangled in what Ton (Zeynep Ton, a retail researcher and associate professor of operations management at the MIT Sloan School of Management in Cambridge, Massachusetts) calls the “vicious cycle” of under-staffing. Too few workers leads to operational problems. Those problems lead to poor store sales, which lead to lower labor budgets.

    “It requires a wake-up call at a higher level,” she said of the decision to hire more workers.

“When you tell retailers they have to invest in people, the typical response is: ‘It’s just too expensive,’” Ton told Bloomberg.

Last month, Wal-Mart was freaking out about their low sales, which they tried to blame on “the January 1 payroll tax ‘increase’ and higher gas prices.” “In emails leaked to Bloomberg News, Jerry Murray, Wal-Mart’s vice president of finance and logistics, called February the worst start to a month he had seen in his seven years with the company. An email from another company executive said in part, ‘Where are all the customers? And where’s their money?’”

Where are the customers? According to Bloomberg they fled Wal-Mart’s poor customer service for places like Costco. You know Costco, where they pay their workers a fair wage and back legislation to increase the minimum wage.

Costco proved the Republican Party and the corporate Scrooges wrong:

    While Wal-Mart experienced February sales that were considered, “total disaster,” Costco’s earnings for the second quarter of the year climbed 39%. The New York Times reported, “Costco Wholesale’s net income for its second quarter climbed 39 percent as it pulled in more money from membership fees, sales improved and it recorded a large tax benefit.”

Costco CEO Craig Jelinek openly supports raising the minimum wage to $11.50 an hour, “At Costco, we know that paying employees good wages makes good sense for business. We pay a starting hourly wage of $11.50 in all states where we do business, and we are still able to keep our overhead costs low. An important reason for the success of Costco’s business model is the attraction and retention of great employees. Instead of minimizing wages, we know it’s a lot more profitable in the long term to minimize employee turnover and maximize employee productivity, commitment and loyalty. We support efforts to increase the federal minimum wage.”

Costco’s good treatment of labor results in higher productivity and less turnover. Bloomberg reported:

    Ton’s research has centered on retailers that include discount club Costco, whose chief executive officer, Craig Jelinek, offered his support publicly earlier this month for legislation to raise the federal minimum wage.

    Costco, which offers a starting hourly wage of $11.50 in all states and employee schedules that are generally predictable, has higher worker productivity and a lower rate of turnover than its competitors, Ton found.

Employees are an integral part of a company’s assets. Happy employees who feel good about working hard for a company that treats them fairly create good customer service. Costco is a great example of the long term viability generated by this old-fashioned business idea, before the age of gleeful, unapologetic greed and short term cash grabs.

Wal-Mart can’t keep its shelves stocked because it believes in cutting labor first in order to save money. Their utter disregard for long term business success has turned them into foolish Scrooges of flailing industry.

The customers are the market. If they’re not happy, they’ll go somewhere else. And they’re not happy with Wal-Mart. Wal-Mart’s entire business model is predicated upon sucking the most profit out of the least labor with no regard to their company image or customer satisfaction. That’s a short-term business model. The numbers don’t lie.

The chickens are coming home to roost for Wal-Mart. There’s only so long you can get by — even when offering the lowest prices — if your stores irritate and annoy shoppers to such an extent that they stop even trying to find what they need at your store. Wal-Mart was the leader in treating workers like crap, making sure they don’t work enough to qualify for health insurance, and thus forcing them into state and federal welfare programs even though they were employed.

It turns out that treating labor well is more than just the right thing to do. It’s also the key to long-term profitability. And contrary to what Republicans tell us, labor is not the enemy. Happy labor is actually a smart investment for a business.

***********

If We Have a Debt Problem Why Aren’t Republicans Cutting George W. Bush’s Spending?

By: Jason Easley
Mar. 26th, 2013
PolitcusUSA

George W. Bush spent $1.32 million last year, but if we have a debt problem, why aren’t Republicans cutting the ex-president’s spending?

The United States government spent $3.7 million on living ex-presidents last year, and over one third of that total went to George W. Bush.

Here is a breakdown of George W. Bush is still spending big on the taxpayer dime, even though he is no longer president:

$1.32 million – Allowance paid to George W. Bush

$85,000 – Bush’s telephone bill

$46,000 – Bush’s postage and printing tab

$395,000 – Rent for Bush’s Dallas office

To be fair, W. isn’t the only former president racking up expenses on the taxpayers’ tab. Bill Clinton’s Harlem office also costs a pretty penny. It also takes up almost half ($442,000) of his 2012 allowance ($978,000). The difference between Clinton and Bush is that former President Clinton is still an active political figure around the world. Clinton is constantly busy with his Clinton Global Initiative. He is still hosting world leaders, and representing his country.

On the flip side, George W. Bush has gone into exile. Bush seems to be spending most of his time painting. I am not knocking him. A person is entitled to enjoy their retirement any way they please, but how is Bush running up these large tabs when he isn’t doing anything? His sitting around and being an ex-president is costing the American people millions of dollars.

Both Bush and Clinton command gigantic speaking fees. Being an ex-president is a license to print money on the speaking circuit, so it seems a little odd that while Republicans are trying to cut every program that is used by the poor and seniors, they haven’t said a peep about Bush’s big tab.

Where is the Republican outrage over George W. Bush’s spending? Republicans like Paul Ryan, who love to suggest that the country is heading for doom because of debt, are oddly silent when the discussion turns to debts that are being run up by former President Bush.

Bush and Clinton make enough money on their own. If there really is a looming debt crisis, shouldn’t Republicans be suggesting that George W. Bush has got to do his part by cutting his spending?

*************

John Boehner Promises To Take Healthcare Away from 30-40 Million People

By: Rmuse
Mar. 26th, 2013
PolitcusUSA

Most people have heard it is better to give than to receive, and nearly everyone experiences that warm feeling when giving to someone in need out of the goodness of their heart, and not an obligation or expectation of reward. Americans are extremely generous people who should be feeling very satisfied because they have given much more than they can afford over the past five years, and doubtless they are going to give a lot more. Even greedy Republicans enjoy giving, and without doubt their generosity comes from the heart and is borne of their obligation to care for their loved ones like every other human being, or maybe it is their constitutional mandate to “provide for the general welfare” of the people they govern.  However, Republicans do not govern the people, they provide for the specific welfare of their corporate and religious masters, and they only give what they take from the people, or put on credit for the people to pay later.

On the anniversary of the Affordable Care Act, John Boehner reiterated a Republican promise to “scrap Obamacare in its entirety to protect families, workers and seniors from losing their health insurance.” Boehner’s lies notwithstanding, scrapping the ACA takes healthcare coverage from 30-40 million Americans and takes protections from predatory insurance companies away from the people. The idea of taking from the people has been the hallmark of the GOP agenda for the past five years, and it violates the Constitution’s mandate that Congress “provide for the general welfare” of the people according to Thomas Jefferson. Article I, Section 8, Clause 1 of the Constitution says, “Congress shall have Power To lay and collect Taxes…to pay the Debts and provide for the general Welfare of the United States,” and Jefferson and George Washington acknowledged that providing for the general welfare meant providing for “the governed people;” but it does not mean Congress takes from the people.

Republicans have been on a tear to take everything and anything from the people for decades that began with the New Deal’s provisions for Social Security, labor laws, and banking regulations that benefit and protect the people. In fact, since President Obama has been in office, the GOP tapped into religious and racial bigotry to garner support for taking more from the people to give to the rich, and they have spared no department, program, or policy that helps the people; including programs funded solely by the people.

The budget House Republicans passed last week is representative of the GOP’s crusade to take food, shelter, healthcare, Veterans’ benefits, Medicare, Medicaid, Meals on Wheels, and educational opportunities from the American people. John Boehner called the Draconian budget “common sense” cuts, but they will not cover tax cuts for the richest Americans. The budget’s tax reform is taking middle class family’s tax credits and deductions away while giving the rich a 15% cut, and giving corporations the means to continue avoiding income tax.  One wonders if there is anything else Republicans can possibly take from the people under the “debt and deficit” mantra infecting Washington, and unfortunately they are taking people’s jobs.

In the run up to the 2010 midterm elections, Republicans pledged creating jobs was their highest priority, but they began 2011 attempting to take away women’s reproductive rights, the Affordable Care Act, Medicare, Medicaid, food stamps, and public sector jobs they claim America cannot afford. Republicans also attempted to take disaster relief, labor rights, research and development, Centers for Disease Control, financial reform, and education funding away from the people as they heaped gifts on the oil, pharmaceutical, and agriculture industry in the form of subsidies they stole from American taxpayers. When John Boehner was given proof the GOP’s habit of taking from the people kills millions of jobs, he said “so  be it” and it revealed that taking food from seniors and children is of no more concern to Republicans than taking Americans’ jobs.

Just in the past year, Republicans proposed taking away child labor laws, minimum wage, overtime pay, voting rights, collective bargaining rights, religion-free education, and freedom from religious imposition and one wonders; just what else can they possibly take from the American people? Their government; it is why they openly campaigned on an anti-government platform and dream of drowning it in a bathtub, and why they promote privatizing everything from schools to the Postal Service to Medicare and Social Security. However, at the rate they are progressing, many Americans would never live long enough to qualify for Social Security, and many children will die before they reach school age for lack of adequate nutrition and healthcare.

There is no limit to what Republicans will take from the people, and no end to their gifts to the rich and corporations. Throughout the GOP’s assault on the people, and with every new attempt to take something away, they stood firm behind their commitment to provide for the general welfare of the rich and powerful with valuable assistance from stealthy Democrats. When Americans cried out for jobs, Republicans offered more tax breaks for “job creators” and enacted spending cuts that kill millions of jobs. When tens-of-millions of Americans begged for affordable healthcare coverage, Republicans promised to “scrap the health law,” cut Medicaid and Medicare, and slash healthcare programs for the poorest Americans. And when natural disasters ravaged giant regions of the nation and victims requested assistance, Republicans balked until they could take something else from other Americans.

America, as the richest nation on Earth is rapidly devolving into a country of peasants existing to serve the rich with no government to protect them or their interests. Republicans have led a thirty year crusade to take any and everything of value from the people whether it is food, healthcare, their retirement, or their jobs, and if they have the opportunity, they will take their lives if they can only find a way to give them to the rich.






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« Reply #5356 on: Mar 28, 2013, 06:16 AM »

 SPIEGEL ONLINE
03/27/2013 02:43 PM

World from Berlin: Russia Becoming a 'Bona Fide Dictatorship'

Russia continued its series of raids on non-governmental organizations on Wednesday with visits to Human Rights Watch and Transparency International. The operation, say German commentators, is just the latest sign that Russian civil society is eroding and President Putin is turning into a dictator.

On Wednesday, it was the turn of Human Rights Watch and Transparency International. Representatives of the two non-governmental organizations said that officials from the Russian prosecutor general's office and from the tax police had arrived at their Moscow branches for an "unannounced audit."

The searches represent the continuation of a series of raids staged by Russian authorities against foreign non-governmental organizations in recent weeks. Some 2,000 NGOs have been targeted.

The raids have not been well received abroad. On Tuesday, several top German politicians protested after authorities searched the offices of the Konrad Adenauer Foundation, a political think tank aligned with Chancellor Angela Merkel's conservative Christian Democratic Union (CDU), and the Freidrich Ebert Foundation, which has ties with the center-left Social Democratic Party (SPD).

The German Foreign Ministry warned that the investigations could have a negative influence on Russo-German relations, while senior CDU parliamentarian Philipp Missfelder said he "had no sympathy" for the Russian campaign.

The intensified observation of NGOs receiving foreign funding in Russia comes after a law was passed last year requiring all such groups to register as "foreign agents" in the country. In February, Russian Prime Minister Dmitry Medvedev urged that the surveillance of think tanks and NGOs receiving foreign funding be intensified.

German politicians haven't been the only ones to voice concern over the campaign. EU foreign policy chief Catherine Ashton said on Tuesday that she was "very concerned with the ongoing actions of the authorities against the NGO community" in Russia. Moscow says it is merely attempting to protect itself from outside attempts to meddle in domestic politics.

Newspaper commentators in Germany on Wednesday are not buying the excuse.

Center-right daily Frankfurter Allgemeine Zeitung writes:

"Since (Vladimir Putin's return to the presidency), one can observe how an authoritarian regime -- which still tolerates a small level of freedom in some niches of society as long as they don't question state power -- is slowly transforming in to a bona fide dictatorship."

"Russia hasn't yet arrived there yet. There are still media outlets that openly criticize the country's rulers. And there is still a legal political opposition and even a civil society. But the raids on Memorial, Amnesty International and the German party foundations in recent days clearly show what direction Moscow is headed. Just as in the court proceedings against those who led protests against the falsified election results, two goals are paramount: intimidation and defamation. Tax officials and public prosecutors are responsible for the former. State-controlled television are responsible for the latter -- particularly NTV, whose coverage is comparable to the worst Soviet-era smear campaigns against those who think differently."

The left-leaning Die Tageszeitung writes:

"It's fairly clear what this concerted action is about: Organizations of civil society are meant to be discredited and intimidated, their work impeded or completely silenced as efficiently as possible. That's precisely the declared goal of the law from last July that regulates non-governmental organizations financed from abroad, characterizing them as foreign agents. These agents have nothing else to do but undermine the democracy guided by President Vladimir Putin with their subversive operations."

"Those like representatives of the German government, who are calling for respect and fair treatment of NGOs, recognize the state of things: NGOs are enemies of the Kremlin and the Russian state. And enemies deserve no respect or fairness."

"That's the reason why the most recent expressions of disapproval by Western politicians don't particularly impress Putin. He knows the importance of his country, not least as a popular trade partner. Looking at it that way, fears among human rights activists that the raids could be just the beginning of a much greater repression are unfortunately all too justified."

The conservative daily Die Welt writes:

"Russia, the Kremlin in particular, is resentful of the moral remonstrations coming from the West -- accusations that are also voiced indirectly in the work of NGOs in the country. Russians finds it humiliating when they are once again the target of a moral rebuke from Berlin, Washington or other Western capitals. Vladimir Putin has repeatedly expressed his displeasure over such reproaches."

"But Russia seems not to understand the trust-building effect of the work performed by NGOs. It is important that, beyond the trade in industrial machinery and luxury cars heading east and oil, natural gas and raw materials heading west that there are also relations of a cultural nature. The German government cannot act as though it is unaffected by the situation. German leaders will have to make it clear that everything has its price, including the obstruction of the NGOs…. Berlin shouldn't turn it into an international affair, but should clearly demand an end to the harassment."

The business daily Handelsblatt writes:

"The actions are a clear signal that the mass protests last year frightened the powerful elite to the bones. They showed that Russian society is developing at a brisk pace, and citizens want access to achievements in many areas that are standard in other countries. But most within the state apparatus fear change. A modern, open society and more influence for the citizenry would endanger the cushy jobs that those in the highest echelon have secured in recent years. They don't want to give up the current status quo."

"The proceedings against foreign organizations in Russia also show that more than 20 years after the collapse of the Soviet Union, the Kremlin still has a problem understanding the point of political foundations. They're suspect because they often work with the opposition. Since the beginning, Moscow has feared being undermined from abroad. In reality the foundations are concerned with freedom, democracy and the strengthening of civil society. Even Russia's economy can profit from that, if both sides work together to improve the legal system."

"Still, the actions of the authorities raise the threat of new harm to German-Russian relations, which have not been the best of shape for quite some time. Such political tensions can have a far-reaching effect -- including on businesses in both countries. They have been doing great for years, but recently the first companies have been looking on with skepticism at the developments in the East. A worsening of economic relations would not at all be in the interest of Moscow, where the economy is dependent on foreign investment to stimulate the economy."

-- Charles Hawley

****************

Vladimir Putin's crackdown on NGOs is return to rule by fear

Russia's president has still not recovered from the protests that swept Russia last year – and wants to ensure they don't return

Miriam Elder in Moscow
guardian.co.uk, Wednesday 27 March 2013 20.05 GMT   

The unprecedented sweep of civil society groups in Russia shows that Vladimir Putin has shifted to ruling openly by the politics of fear. The powerful president has yet to recover from the protests that swept Russia around his return to the Kremlin last year. Protesters have been arrested, organisers charged, Pussy Riot jailed, and now non-governmental organisations targeted as potential agents of the west.

The sweeps were conducted under a controversial law adopted last year, requiring all NGOs who receive foreign funding to register as "foreign agents". In Russian, the term conjures images of Soviet-era propaganda beseeching citizens to avoid contact with all foreigners. The idea that all foreigners are spies has once again been revived. It began when Putin blamed the protests on Russia's traditional external enemy, the United States.

To many, the raids – in which officials from the prosecutor's office, tax inspectorate and ministry of justice combed through registration and financial documents – came as a surprise. Inside Russia's human rights community it was expected, after Putin suddenly recalled the law during a meeting with officers from his feared security services last month. "It was a classic signal," said Rachel Denber of Human Rights Watch, whose Moscow office was raided on Wednesday.

The net has been cast wide. It is not only the traditional groups of which the Kremlin has long voiced suspicion that have been targeted. Caught up in the raids are NGOs across Russia, including a Catholic church in the southern region of Rostov, a young environmentalist group called Akva in the port city of Novorossiysk, an Aids charity in the region of Bashkortostan. Lest they forget, these groups now know they are being watched.

In a country plagued by a corrupt police force, a politicised justice system, and an often indifferent government, NGOs play a key role. Lev Ponomarev, the 71-year-old head of For Human Rights, which was raided on Monday, calls his group a "last resort" for those seeking justice. He has advised thousands.

Ponomarev has refused to register under the law, arguing that he would be unable to work with the tag in a country where the Soviet past is still alive. Officials and regular citizens alike would turn away, he said. The campaign against NGOs has only made it more problematic to receive funding inside Russia.

The current checks have come as a warning, many in Russia's human rights community said. Down the line, refusal to register under the law could lead closures, fines, and a two-year jail sentence. What worries many more are the laws waiting in the wings, particularly a new law signed by Putin late last year that vastly expands the definition of treason to include any Russian believed to pass state secrets to any foreign organisation.

Like the law against NGOs, it has lain dormant for months. "They can call it up at any moment," said Ponomarev. "Then they will really jail us for being foreign agents." The law carries from four to twenty years in prison.

***************

Russia raids offices of Amnesty International and other human rights groups

By Miriam Elder, The Guardian
Wednesday, March 27, 2013 20:20 EDT

Germany and France summoned Russian diplomats in Berlin and Paris on Wednesday, after Russia launched a series of raids on international non-governmental organisations (NGOs) across the country amid a wider crackdown on critics of the Kremlin.

The sweeps, billed as an attempt to weed out “foreign agents”, targeted human rights organisations, environmental advocates, women’s groups, non-Orthodox churches, charities and at least one French language school. Among the sites raided were the Moscow offices of the rights groups Amnesty International, Human Rights Watch and Transparency International.

“This is the planned destruction of the NGO sector in Russia,” said Lev Ponomarev, head of For Human Rights, a Russian group that was targeted on Monday. “It’s a war on NGOs and the strengthening of the authoritarian police state.”

Catherine Ashton, the EU high representative, said she was “concerned” by the raids and said they formed part of “a trend that is deeply troubling”.

“The inspections and searches launched against the Russian NGO community and conducted on vague legal grounds are worrisome since they seem to be aimed at further undermining civil society in the country,” she said in a statement.

The German foreign ministry summoned the number two diplomat in the Russian embassy in Berlin on Tuesday “to express the German government’s concern” over the raids. Two German NGOs in Moscow and Saint Petersburg were raided earlier this week. Hans-Gert Pöttering, chairman of the Konrad-Adenauer-Stiftung foundation in Saint Petersburg, said officials had seized four of the group’s computers there.

The French foreign ministry sent a note to its Russian embassy on Wednesday demanding an explanation, but said in a statement that the ambassador had been “invited” for a discussion.

The US embassy in Moscow said via its Twitter feed: “It is with great concern that we are following reports of unprecedented inspections of NGOs across Russia.”

Prosecutors, tax inspectors and officials from the justice ministry have conducted unannounced “checks” on more than 80 organisations around Russia, said Pavel Chikov, the head of Agora, a legal group that provides assistance to civic and political activists. Thousands more are expected to be targeted, he said. Agora was raided on Wednesday.

The sweep comes eight months after Vladimir Putin, the president, signed a widely criticised law demanding that NGOs which receive funding from abroad label themselves as “foreign agents”. Critics said the law was reminiscent of Soviet-era efforts to demonise foreigners and those “collaborating” with them.

A handful of groups, including For Human Rights, have refused to follow the law on principle. “I am not a foreign agent,” said Ponomarev, arguing that following the law – which includes stamping “foreign agent” on all paper and electronic documents – would make his work impossible.

There was little noise about the law since its signing until last month, when Putin used a Valentine’s Day meeting with officers from the Federal Security Service (FSB) to remind them of its existence. “No one has the right to speak for all of Russian society, especially those who are directed and financed from abroad and thus serve the interests of others,” Putin said. “Today we have set the order of NGO activity in Russia, including funding from abroad. These laws must, without a doubt, be fulfilled.”

Within weeks, inspectors were fanning out across the nation.

On Wednesday, they arrived at the central Moscow office of Human Rights Watch, a New-York-based group that has operated in Russia since the fall of the Soviet Union.

“This is the first time in over 21 years that we have been inspected,” said Rachel Denber, deputy director of HRW’s Europe and Central Asia division. “The scale of these inspections has been massive and unprecedented and is part of a much broader campaign to limit civil society.” It was also, she said, “part of a broader effort to brand those organisations that are connected to foreigners as enemies, as suspect”.

Putin returned to the presidency last year amid unprecedented protests. While street action against him has died down, anger with the powerful longtime leader – particularly among the urban middle class – remains strong.

The crackdown against critics has been relentless. More than 20 people are facing jail for participating in a protest on 6 May and criminal charges have been brought against a host of opposition leaders. A series of laws has been introduced to clamp down on dissent.

The Kremlin has also promoted a growing suspicion of foreigners, particularly Americans. Last year, Russia shut the office of the US Agency for International Development after accusing it of trying to influence Russia’s elections. Americans were banned from adopting Russian children late last year.

“Russia’s leadership has made very clear for at least a year, and Putin himself has not missed an opportunity to say, that when foreigners raise human rights issues in Russia, he believes it to be an infringement on national sovereignty,” said Denber.

The tax inspector and three officials from Russia’s prosecutors office that visited HRW’s office on Wednesday were accompanied by a camera crew from NTV, a state-run television channel owned by the gas giant Gazprom that has aired regular propaganda films accusing Russian human rights workers and opposition activists of acting on orders from Washington. NTV ran similar footage of a raid on Ponomarev’s group earlier this week.

guardian.co.uk © Guardian News and Media 2013

**********

March 28, 2013

Putin Orders Large-Scale Military Exercises in Black Sea

By REUTERS

MOSCOW (Reuters) - President Vladimir Putin ordered the launch of large-scale Russian military exercises in the Black Sea region on Thursday, his spokesman said, in a move that may create tensions with Russia's post-Soviet neighbours Ukraine and Georgia.

Putin issued the order to start the previously unannounced manoeuvres at 4 a.m. Moscow time (4 a.m. British Time) as he flew back from an international summit in South Africa, his spokesman, Dmitry Peskov, told reporters by telephone.

"These are large-scale unannounced test exercises," Peskov said, adding that 36 warships and an unspecified number of warplanes would take part. "The main goal is to check the readiness and cohesion of the various units."

He did not say how long the exercises would last.

Putin has stressed the importance of a strong and agile military since he returned to the presidency last May after four years as prime minister. In 13 years in power, he has often cited external threats when talking of the need for unity in Russia.

Russia's Black Sea fleet, whose main base is in the Ukrainian port of Sevastopol, was instrumental in a war with Georgia in 2008 over the Russian-backed breakaway Georgian regions of South Ossetia and Abkhazia.

Disputes with Kiev over Moscow's continued lease of the Black Sea navy base have been a thorn in relations with its former Soviet neighbour.

Peskov said that Russia is under no obligation to warn neighbours ahead of time of plans to hold the air and sea military exercises as long as fewer than 7,000 servicemen participated in the manoeuvres.

(Reporting by Alexei Anishchuk; Writing by Alissa de Carbonnel; Editing by Douglas Busvine and Toby Chopra)


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« Last Edit: Mar 28, 2013, 07:03 AM by Rad » Logged
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« Reply #5357 on: Mar 28, 2013, 06:29 AM »

 SPIEGEL ONLINE
03/27/2013 05:04 PM

The 'Pride of Russia': A Corrupt Politician's Ignoble Demise

By Matthias Schepp

A corrupt rising star in Putin's ruling party was recently found dead in a cement-filled barrel. His murder reveals the murky cross-section of politics, business and crime that characterizes today's Russia.

Before Mikhail Pakhomov ended up in a metal barrel, his bones broken and his body encased in cement, he enjoyed himself one last time. It was the evening of February 12, and Pakhomov went to Marengo, his favorite restaurant in Lipetsk, an industrial city 370 kilometers (230 miles) from Moscow. On either side of the restaurant, which serves a beef salad called the "Camorra," are the Raspberry movie theater and the Igniter strip club.

For once Pakhomov, 35, was without female company, says a waitress. When he left the restaurant, three men dragged him into a car. When Pakhomov tried to escape, the men shot at him. Then they continued driving toward Moscow and delivered the injured man to their presumed customer. Pakhomov was then locked in an ice-cold basement and tortured.

Once he had died, his tormenter stuffed his body into a barrel filled with cement, wrapped it in plastic and hid it in a damp garage, where the police found it soon afterwards. It took them seven hours to cut through the cement and expose the body of Pakhomov, a local politician, businessman and rising star in Russian President Vladimir Putin's party.

It was more than just a corpse that had come to light. The discovery shone a spotlight on an entire system, a network of politicians, businessmen and criminals, held together by corruption and money into the billions. The Pakhomov case exposes a Russia in which a mobster becomes a businessman and then a politician, and is even awarded the "Pride of Russia" medal.

After his death, the government newspaper Rossiyskaya Gazeta gave Pakhomov an exceedingly large and favorable obituary, without mentioning his criminal past. He was indeed a model politician, just not the way in which he is described in the hymns of praise written after his death.

'Criminals Have Come Into Power'

In the 1990s Pakhomov was involved in the robbery of a grocery store. He only managed to stay out of prison because his father, a well-known theater director, paid for a favorable psychiatric evaluation.

"Pakhomov was part of the mafia, the Lipetsk Brotherhood. His death is the logical consequence of his career. He cheated too many people," says Sergei Valetov, a former police colonel who, as head of the organized crime division of the regional police department, was investigating Pakhomov. "Criminals have come into power, and Pakhomov isn't the only politician who made his money in illicit ways."

The head of the city parliament of Lipetsk, in which Putin's party, United Russia, holds 31 of 33 seats, is a shady businessman who made his fortune with vodka and low-cost government loans. Companies tied to him are reportedly involved in a corruption scandal with €800 million at stake. One of the suspects is a former agriculture minister.

After the murder of their people's deputy, Lipetsk residents have been venting their hate on local Internet sites. "A dog deserves a dog's death," one post reads. Another citizen writes: "I hope Pakhomov isn't the last one."

Comments like these reflect envy, but they also belie disgust over the ostentatious lifestyles of the nouveau riche. Pakhomov, a member of that despised class, drove around in a Rolls-Royce while his wife drove a flashy Mercedes decorated with crystal glass.

Dirty Dealings

SPIEGEL has gained access to a dossier prepared by the Russian domestic intelligence agency FSB in the fall of 2010, which describes how Pakhomov acquired his wealth. According to the report, Pakhomov bribed judges and obtained government construction contracts by underhanded means. In one case, for example, he made a deal with the director of the Lipetsk special economic zone, Sergei Krassovsky, who awarded Pakhomov's companies a government contract worth millions to install district-heating pipes. By all appearances, Krassovsky received generous kickbacks in return.

Pakhomov increased his profits by cheating the companies he had hired to complete the construction work. He transferred some of the money from the government contract to foreign bank accounts.

He also paid for management courses attended by his friend Krassovsky in London. When Krassovsky moved to Moscow in the summer of 2009 and was promoted to director of the government-owned company Mosoblkommunalstroi, he made sure his partner Pakhomov received more contracts, including a €30-million deal to build playgrounds in the Moscow region.

Nepotism is rampant in the affluent outskirts of the Russian capital. The area is home to the son of Russia's top criminal prosecutor, who is allegedly involved in illegal casino deals. Another resident is a vice-governor who openly transferred municipal properties worth billions to this wife, and also reportedly siphoned off €70 million from his budget. When this was revealed in 2008, he fled to the United States. And even though a warrant had been issued for his arrest, he was later spotted skiing with the head of the Kremlin security service.

Pakhomov and Krassovsky hoped to make a killing in this environment, in which political offices translate primarily into perks. It didn't hurt that Krassovsky is married to the daughter of Yevgeny Kharitonov, a vice-minister of the Moscow region.

Apparently Pakhomov also recognized that those who hope to become genuinely rich in Russia must also play a role on the big political stage. He organized an American-style election campaign in Lipetsk for Putin and United Russia, hiring female cheerleaders with short skirts and drums, ran expensive TV ads and handed out free T-shirts. In 2010, Pakhomov became a member of the city parliament in Lipetsk and narrowly lost a seat in the national parliament in Moscow.

Pakhomov portrayed himself as a patriot. He championed the rights of workers exposed to radiation at Chernobyl, headed an aid convoy to South Ossetia in August 2008 and donated money to restore old monasteries. During campaign appearances, he told the crowd: "Everyone can help write the history of his country."

Corruption Revealed

Now he too is part of that history, but not in the way he meant at the time. Ironically, the children's playgrounds are to blame. To enhance his profits, Pakhomov bought cheap playground equipment from China, which was so poorly made that it led to many accidents, and several children died. The fraud was exposed and his corrupt agents, Krassovsky and Kharitonov, lost their jobs.

The two men, determined to take revenge, demanded that Pakhomov pay them €61 million. But he refused to yield, and they decided to have him kidnapped. It was Kharitonov who placed his former friend in the cement-filled barrel. Because the kidnappers were caught at a police checkpoint soon afterwards, the men behind the murder were quickly identified, and Krassovsky and Kharitonov were arrested a few days later.

The spectacular murder happened at a time when President Putin is trying to improve his sinking popularity with an anti-corruption campaign. New revelations appear every week, providing fodder for the pro-Kremlin press. Politicians are sharply criticized for buying expensive villas abroad or luxury apartments in downtown Moscow, purchases that are hardly in keeping with their salaries.

To this cause Putin recently went so far as to sacrifice his own all too efficient defense minister, a supporter who, as head of the country's tax agency, had helped him put oil baron Mikhail Khodorkovsky into a prison camp.

It's a risky strategy, because each new scandal further undermines the public's confidence in the government and Putin's power circle. And a murder plot among corrupt members of his party certainly doesn't shine a positive light on the president.

Pakhomov, at any rate, is in good company in the Lipetsk cemetery. His grave lies next to those of politicians, business leaders and underworld bosses, the unholy trinity in Putin's Russia. They're easy to recognize. The gravestones of the crime bosses, in particular, are the biggest and the most expensive.

Translated from the German by Christopher Sultan

*********

March 27, 2013

With Trial Suddenly Looming, Russian Activist Expects the Worst

By ANDREW E. KRAMER
IHT

MOSCOW — Since his earliest days as an opposition blogger, Aleksei A. Navalny has known that a prison sentence loomed as a possibility.

That day now seems nearer, Mr. Navalny said this week in an interview after a court announced that within a week it would schedule for trial one of several criminal cases that have been pending against him for years, even as he led last winter’s street protests.

“Honestly, I am almost certain I am going to prison,” Mr. Navalny said of the case, which accuses him of embezzling $500,000 from a timber company in a rural part of Russia four years ago. It has been pending since 2010.

Last spring, prosecutors closed a case against him based on the same charges, saying they had no evidence of wrongdoing. But in July, the case was reopened.

“This is my sense,” he said in the Moscow office of his nonprofit group, which creates Web sites that allow citizens to report government corruption and mismanagement. “I don’t have any insider tips. But the case was going so slow, and the investigators let me know they thought it was ridiculous, too.”

Then late last year, he said, “it started to go faster and faster.”

He called the charges all the more sinister for being absurd, coming so long after the embezzlement allegedly took place and in relation to work he did pro bono as a lawyer for a liberal politician who is a regional governor.

He said that a conviction was nearly inevitable if the case proceeded to trial, as appears likely, but that a judge might suspend the sentence. That would allow him to be released on parole immediately, though with a criminal record, which in Russia means a ban on running for public office.

Mr. Navalny’s assessment that he probably faces conviction, though possibly with a suspended sentence, is a departure from his earlier views on the cases against him, which are part of a larger crackdown on opposition figures here. A boisterous, scrappy practitioner of online organizing, Mr. Navalny had always projected an optimistic, humor-laden persona appealing to the middle-class, professional Muscovites who are his core audience.

Until the interview this week, he had brushed aside the timber theft case as a threat that might simmer forever but that would never go to court. A subtle exchange with the Kremlin through intermediaries late last year led him to change his opinion, he said.

The case against him, known as the KirovLes case for the name of the timber company, seemed to be fast-tracked in December after he led an opposition rally in Lubyanka Square in Moscow, in front of the rock-and-brick headquarters of the Federal Security Service, the successor to the K.G.B.

The rally signaled a shift in tactics. The movement that began in late 2011, bringing tens of thousands of defiant Russians out to the streets of Moscow in a show of widespread discontent, was petering out from lack of interest, while the city government was suggesting ever more obscure and remote parks for protest sites. Mr. Navalny and other organizers argued that protesters should come to Lubyanka Square anyway, even lacking a permit, in an act of civil disobedience.

That position, he said, alarmed officials. They conveyed a message through two intermediaries, he said, suggesting that he form a political party as an outlet for his cause but reject unauthorized street gatherings.

“ ‘We won’t let him lead people on the street,’ ” said Mr. Navalny, summarizing the message.

“Along the spectrum of politics, some people are inscrutable, unpredictable and uncompromising,” he said of the officials’ thinking. “Some, they know how to co-opt. Others, they don’t. They don’t want these other people in politics.”

Mr. Navalny said he refused; the timber case sped to trial in Kirov, a region east of Moscow.

In Moscow, signs of heightened pressure are already appearing.

He recently shifted his desk to avoid the gaze of a tiny camera he found hidden behind the wall molding. A complaint to the police went nowhere.



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« Last Edit: Mar 28, 2013, 07:05 AM by Rad » Logged
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« Reply #5358 on: Mar 28, 2013, 06:31 AM »

 SPIEGEL ONLINE
11/30/2012 04:08 PM

Corruption in Russia: Putin Strikes a Pose against 'Thieves and Traitors'

By Benjamin Bidder in Moscow

First the defense minister had to go, and now Vladimir Putin's agriculture minister is being pushed out on suspicion of corruption. State-run television has begun an aggressive hunt for "thieves, traitors and enemies of the people." The main target, however, seems to be that of improving the Russian president's approval ratings.

The latest stage of the fight against corruption is illustrated by Russian state television with footage from the Côte d'Azur, images of wild parties with black caviar and diamond-encrusted Kalashnikovs. Then the correspondent approaches Hollywood star George Clooney's villa in a helicopter before more villas come into view. Here is where "Moscow's government officials go to be pampered," the show intones.

The station devoted 70 minutes to portraying the country's chronically corrupt and notorious civil servants. They are a "force in gray jackets who can sabotage reforms and are boycotting laws," moderator Arkady Mamontov says.

Usually Mamontov devotes himself to adversaries of the Russian state. He's made a film about Russian human rights activists who supposedly worked with British spies, and has already done three shows about the punk band Pussy Riot, in which he suggested the activists were the paid handmaids of the United States.

But instead of taking on the opposition, this time Mamontov has a member of the power elite in his sights: President Vladimir Putin's former agriculture minister, Elena Skrynnik, who was in his cabinet from 2009 to 2012. She has been accused of nepotism and it is said that those close to her have seen their personal wealth skyrocket. For years, the 51-year-old was the head of the state-run company Rosagroleasing, which was set up to purchase agricultural machinery. But under her aegis, a significant sum of money is said to have slipped away. Mamontov's reporters interview one of the company's workers who named the sum of 39 billion roubles, or around €1 billion ($1.3 billion).

Putin Plays the Corruption Fighter

Skrynnik's case is the second corruption affair in just one month to involve a former minister. In early November, Putin made the surprise move of firing Defense Minister Anatoly Serdyukov. Since Serdyukov's departure, hardly a day has gone by without some new revelation about irregularities in defense industry privatization efforts. Broadcasters run stories about the scandal during prime-time and newspapers sympathetic to the Kremlin run them on their front pages. The aim of the campaign? Portraying Putin -- who, in his 13th year of power has the worst approval ratings in over a decade -- as a dedicated opponent of corruption. In September, just 41 percent of Russians said they trusted the president.

Alexei Mukhin, a political scientist at the Putin-friendly Center for Political Information has spoken of a "cleansing of the elite," and of fine-tuning the image of a "new Putin." Next up, according to Mukhin, could be the head of the Russian Space Agency or the ill-reputed former Health Minister Tatyana Golikova.

Elena Skrynnik, the former agriculture minister, has spoken to the press about her situation, albeit from abroad, a trip she said was approved by Putin. Yes, she was questioned, she said. And yes, she owns a home in France, but she earned it honestly during her time as a businesswoman between 1993 and 2000. Furthermore, under her leadership at Rosagroleasing it "was impossible to steal money."

That is difficult to believe, however. Oleg Donskich, previously Skrynnik's right-hand man, has a warrant out for his arrest and has left the country. Other suspects include Leonid Novitskiy, Skrynnik's brother. Sponsored by his sister, the cross-country rally driver rose to become the deputy head of Rosagroleasing.

Old News

State-run television highlighted the accusations with photographs of a dilapidated industrial farming operation. Some 280 million roubles (€7 million) had been set aside for modernization, but the facilities are rotting away nonetheless. A local farmer complains to the camera that in Russia there are "no officials who think of the country."

Still, the results of Mamontov's alleged investigative report is hardly new; it is but a collection of facts that have long been known. Moscow dailies and magazines have been reporting for years on Skrynnik's circle.

What is new, however, is the fervor with which the station has been addressing the issue. Inside the offices of Russian authorities, there is a "colossal battle underway between the thieves and honest people who think of the country," thunders Sergey Markov, a former parliamentarian in the Duma, into the camera. Now the corrupt "traitors" must be removed, he says.

Then a white-haired political scientist speaks up. Vitali Tretyakov is a hard-liner who, during the German-Russian Petersburg Dialogue in mid-November, predicted the downfall of Europe due to widespread homosexuality. "Today there is more being stolen than by the Bolsheviks and czars together," he complains, adding that officials "no longer fear anyone at all. Not Stalin, not Lenin, God, the devil, angels and not democracy either." Indeed, the term "enemy of the people" ought to be reintroduced and used in reference to corrupt officials, he says.

His comments were met with applause by the studio audience. Indeed, such tough posturing could be just the thing to turn Putin's poll numbers around. It remains to be seen whether it will result in a reduction of corruption.


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« Reply #5359 on: Mar 28, 2013, 06:36 AM »


Boris Berezovsky death: super-rich no longer feel so secure in Londongrad

UK courts resist extradition back to Russia – but several oligarchs have died in Britain in mysterious circumstances

Robert Booth   
The Guardian, Sunday 24 March 2013 22.34 GMT   

When Boris Berezovsky and his bodyguards cornered Roman Abramovich among the silk scarves and handbags of the Hermès shop on Sloane Street and served him with a $5bn writ, it was the clearest sign yet that London's most desirable corners have increasingly become Russian turf.

From the streets of Kensington and Belgravia to the suburban mansions of Surrey and Berkshire, the capital and its fringes are now a battleground as well as a safe haven for Russian billionaires including the aluminium oligarch Oleg Deripaska, Alisher Usmanov, a majority shareholder in Arsenal football club, and Alexander Lebedev, the ex-KGB man turned owner of the Evening Standard and Independent newspapers.

Money is no object. Abramovich bought up a pair of neighbouring mansions in Lowndes Square to create a Belgravia palace, but is now reported to be preparing to sell up and is instead refurbishing a £100m home on Cheyne Walk in Chelsea. On trips to London, Deripaska lives in a huge Belgrave Square mansion or out at St George's Hill in Surrey while Usmanov lives in Highgate and Leonard Blavatnik, a Russian-born American billionaire, owns one of central London's biggest homes in Kensington Palace Gardens.

The prime attractions for some have been security and legal protection, according to Mark Hollingsworth, author of a study of Russians in the capital, Londongrad.

"Until a couple of years ago they believed if they moved to London they are not going to get assassinated or kidnapped," he said.

The feeling of imperviousness may be waning. Last year, Russian banker German Gorbuntsov was in a coma after being shot at Canary Wharf and Russian supergrass Alexander Perepilichnyy dropped dead from mysterious causes in Surrey.

"More important still is the legal protection against extradition, charges or investigation," added Hollingsworth. It is the work of the judges who preside at the Royal Courts of Justice on the Strand that means most to many oligarchs. The UK courts' resistance to efforts to extradite Russians back to face charges in Moscow amid ongoing concerns about the fairness of trials in Russia is priceless.

London's lifestyle – the Michelin-starred restaurants and luxury apartments that have for decades attracted Arab tycoons – remains a significant attraction, though, not just for the oligarchs who made fortunes under Yeltsin, but for newer immigrants of rich whose wealth has flowered under Vladimir Putin.

Yevgeny Chichvarkin, who made a fortune as a mobile phone retailer, fled to London in 2009 after apparently falling out with the Kremlin over his tax bill. He has since set up shop as a luxury wine merchant.


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« Reply #5360 on: Mar 28, 2013, 06:38 AM »

War crimes court jails Bosnian Serb ex-officials for 22 years

By Agence France-Presse
Wednesday, March 27, 2013 17:55 EDT

The Yugoslav war crimes court on Wednesday jailed for 22 years two former Bosnian Serb officials closely linked to ex-leader Radovan Karadzic, for their roles in a campaign to rid Bosnia of Muslims, Croats and other non-Serbs early in the Balkan country’s 1992-95 war.

“The trial chamber hereby sentences Mico Stanisic” and his subordinate Stojan Zupljanin “to a single sentence of 22 years in prison,” International Criminal Tribunal for the former Yugoslavia (ICTY) judge Burton Hall said.

Both men, dressed in dark suits and light shirts, with Stanisic wearing a light blue tie and Zupljanin a red, remained unmoved as their sentences were pronounced.

Stanisic, 58, a former minister in the Bosnian Serb Ministry of Internal Affairs and former regional security services chief Zupljanin, 61, faced war crimes and crimes against humanity charges including murder, torture and cruel treatment of non-Serbs in municipalities and detention centres during Bosnia’s war which left 100,000 people dead and some 2.2 million homeless.

They are both regarded as associates of Bosnian Serb ex-leader Radovan Karadzic, who himself faces charges before the tribunal including that of genocide for allegedly masterminding ethnic cleansing in Bosnia after the breakup of the former Yugoslavia in 1991.

The UN court’s judges found that the two men participated in a joint criminal enterprise to cleanse non-Serbs from municipalities in Bosnia marked to become part of a Serbian state, by allowing forces under their command to engage in “violent takeovers of those municipalities and the ensuing widespread and systematic campaign of terror and violence.”

The crimes were committed between April and December 1992 in 20 of Bosnia’s municipalities and 50 different detention facilities set up by Bosnian Serb forces, where captives were beaten, tortured, mutilated, sexually assaulted, humiliated and psychologically abused.

“Many detainees were killed or died as a consequence of the mistreatment. Across municipalities, thousands of non-Serbs were either killed or forcibly displaced from their homes,” the judges said in their verdict.

“Through these acts and omissions both intended and significantly contributed to the plan of removing Muslims and Croats from the territory of the planned Serbian state,” added Judge Hall.

“The chamber finds that the goal of these actions was the establishment of a Serb state as ethnically pure as possible,” he said.

Stanisic, said Judge Hall, “as a minister of interior… was charged with protecting the people, but he failed to take adequate steps to protect Bosnian Muslims, Bosnian Croats and other non-Serbs.”

Zupljanin “dispatched his policemen… who participated with the Serb forces in the takeover of municipalities in the ARK (Autonomous Republic of Krajina),” the judge said.

Villages in the municipalities which were predominantly Muslim or Croat “were shelled by Serb forces. This was accompanied by systematic looting,” Hall said.

Zupljanin later became an advisor to Karadzic, while “Mr. Stanisic had a close relationship with” Karadzic, the judge said.

Stanisic gave himself up in March 2005 and was released afterwards to move around freely until being summoned to stand trial.

Zupljanin, a former police chief in the Krajina region of northwestern Bosnia who was arrested in June 2008 in Serbia after more than nine years on the run, has remained in custody after being judged a flight risk.

Their trials — in which prosecutors asked for a life sentence — were joined in September 2008 and took 354 days of hearings with the evidence of 199 witnesses admitted, the ICTY said in a statement.

In Sarajevo, the head of the Association of Victims and Witnesses of the Genocide in Bosnia, Murat Tahriovic, said he was “satisfied” with the sentences.

“Given that sentences handed down to other former Bosnian Serb officials, who were more important at the time, were less severe,” he told AFP.

“We must nevertheless be prudent and await the appeal. Verdicts on appeal at the ICTY have recently been strange, to say the least, and I hope that we won’t be surprised, as we were with Momcilo Perisic,” he said.

The ICTY in February acquitted Yugoslav ex-army chief Perisic on appeal and overturned his 27-year sentence for war crimes and crimes against humanity during the Bosnian war, sparking the ire of victims’ groups.


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« Reply #5361 on: Mar 28, 2013, 06:42 AM »

Cyprus banks reopen – but stock exchange will remain closed

Small queues as bank staff turn up for work early in Nicosia and cash is delivered under heavy security

Jill Treanor, Helena Smith and Josephine Moulds   
guardian.co.uk, Thursday 28 March 2013 11.28 GMT   

Cyprus's banks reopened their doors on Thursday, to limited queues, amid strict controls to stop people withdrawing all their savings and triggering a catastrophic bank run.

The Cyprus stock exchange, however, said it would remain closed for the day, less than an hour before it was due to open for the first time in almost two weeks.

The country had feared a stampede on the banks after a 12-day hiatus while the government negotiated a €10bn (£8.4bn) bailout package to avoid financial collapse. But high street banks were not inundated as they reopened, despite the fact that wealthy savers could face losses of at least 40%.

Extra security has been drafted in from G4S to manage any trouble, and some banks are limiting the number of people allowed in each branch.

"I want to cash my salary," said Christina Andreou, wielding a cheque for €1,300 at a Bank of Cyprus branch in Nicosia.

"There's no point being anything but patient. Fighting is going to get us nowhere," said Dinos Volides. "Everyone in the bank is trying to be as helpful as possible."

Many of the people turning up at branches were older customers who do not have bank cards and need to withdraw cash for daily expenses.

At other branches, bank staff asked for calm from customers, saying they too were "victims of the actions and or failures that caused this catastrophe." Employees of Laiki, the country's second largest bank, are likely to lose their jobs when its toxic assets and large deposits are placed in a 'bad bank' and run down, with smaller deposits transferred to the Bank of Cyprus.

The population remains deep in shock, with one Cypriot describing the crisis like the sudden death of a loved one. "We're feeling the same sort of emptiness," said Afrodite Elisaou, a doctor whose husband works at Laiki and still has no idea whether he will have a job tomorrow. "It's the shock of it happening overnight, of going to sleep thinking you have a job and waking up not having one. Had all this happened to us gradually, and not in a day, it would have been much better."

Under the capital controls, cash withdrawals will be limited to €300 a day, although in recent days banks have restricted withdrawals to €100 per customer.

Yiangos Demetriou, the head of internal audit at the island's central bank, told the Cypriot state broadcaster that a limit of €5,000 would be set on the use of credit cards abroad and said the measures would be imposed for just four days.

Anyone leaving the country will be unable to carry more than €1,000 in banknotes, while families with members studying abroad will not be able to send more than €5,000 a quarter, plus tuition fees, to their relatives.

It is the first time a member of the single currency has faced such emergency measures to keep cash within its borders since the euro was launched in 1999. "The rationale is that these measures will be reviewed on a daily basis, so if there is the possibility of relaxing them we will," Demetriou said.

Bob Lyddon, the general secretary of IBOS, an international banking association, described the controls as "more reminiscent of Latin America or Africa". "These are permanent controls until the economy recovers," said Lyddon, casting doubt on any suggestion the capital controls could be temporary.

The Cypriot financial sector has exploded in size to eight times the size of its €17bn economy, inflated by deposits from wealthy foreigners. Much now hinges on the reaction of Russians who have made huge deposits in Cyprus in recent years.

In the US, New York's powerful financial services industry has already benefited from a silent Cyprus bank run. "This past year, we've been seeing a shift in investments in the United States as a result of the financial state of the European Union," said Ed Mermelstein, a New York real estate lawyer who advises wealthy Russians.

Banks in Cyprus were closed 12 days ago shortly before president Nicos Anastasiades announced the terms of its bailout, which included skimming all savers to raise €5.8bn.

The terms have since been altered to ensure that those with less than €100,000 in their accounts are not forced to take a cut, in a move that the European authorities hope will restore faith in the bank guarantee scheme across the 27 EU nations.

Under the terms of the bailout with the EU, the European Central Bank and the International Monetary Fund – known as the troika – Laiki will be closed down, while the nation's biggest bank, the Bank of Cyprus, faces a major restructuring.

Depositors with more than €100,000 in their accounts, the level at which savings are guaranteed across Europe, face a levy to raise billions of euros towards the bailout. According to some estimates, this could be between 40% and 80%.

In Britain, the government has been working on ways to keep Laiki's four branches being drawn into the Cypriot bailout, but there was little indication on Wednesday night that a solution had been found for the 13,000 customers potentially affected.

Chris Pavlou, the former vice-chairman of Laiki, told Channel 4 News that Anastasiades was given little option by the troika but to accept the draconian terms, which force savers to take a hit for the first time in the fifth bailout of a eurozone country.

Pavlou said: "It's not very nice actually, to see two or three people half your age, clever people, coming over there and shaking their hands at the president and saying: 'You have to do this, otherwise we bring you down.' It is very painful for someone who's just been elected to actually face that."

The meltdown of the Cypriot financial system came as no surprise to well-connected, wealthy Russians, who bundled some of their money to the US. "Many of our clients had a heads-up on this issue," said Mermelstein. "Cyprus had started having the conversations about what it was intending, and that's been going on for half a year."

Michalis Sarris, the Cypriot finance minister, has admitted that Cypriot banks were suffering "substantial outflows" for weeks before the meltdown, indicating that Russians were already anticipating the crisis.

According to investment bankers, lawyers and wealth advisers in the US, Russians have been seeking property developments in the US over the past year. Lawyers and advisers have been making construction loans and sinking money into the concrete foundations of the big real estate developments in Manhattan.

Six months ago, Mermelstein said, a Russian client took several million dollars from a Cyprus account and made a loan to a commercial project in New York.

After Cyprus announced an overnight bank raid into the deposits of rich customers, Mermelstein said his client "was happy the loan came out of Cyprus and doesn't have to go back any time soon". Such investments, ranging in size from $5m to $25m, have "gone up substantially", the real estate lawyer said.

With ink on the Cypriot bailout barely dry, the focus was turning to which countries might face the same fate, following Greece, Ireland, Portugal and Spain.

James Howat, European economist at Capital Economics, said: "Cyprus has shown that even the smallest members of the eurozone can rock the single currency area.

"Slovenia is probably the next country most likely to be forced into a bailout programme, but Malta and Luxembourg are also vulnerable given the size of their banking sectors relative to their economies.

"There is already evidence of market stress in Slovenia, with government bond yields rising from 4.5% to 6.5% over the last two weeks."

On Thursday, the German finance minister, Wolfgang Schäuble, tried to limit fears of contagion, saying Cyprus was a very special case and the EU had found the right solution for it. He said Luxembourg had a completely different business model to Cyprus and any comparison of the two would be absurd.

Analysts at Fathom Research said that the relief surrounding the Cyprus deal would be temporary. "The relief is misplaced and will be shortlived, since the 'doom-loop' undermining the euro, between insolvent banks and their indebted sovereigns, has not been broken but emphatically reaffirmed."

*************

Cyprus waits for its 'giant leap back into the dark'

With the country's banks finally poised to reopen, there is anger and fear – but above all uncertainty

Helena Smith in Nicosia
guardian.co.uk, Wednesday 27 March 2013 22.09 GMT   

Small countries feel the onset of poverty quickly. In Cyprus, now poised to become one of the biggest experiments in global financial history, people know that penury is just around the corner.

Waiting for poverty to strike is no game. It makes ordinary men and women helpless, desperate and scared. "If you look at it mathematically, there is no way out: we will just never be able to repay our bills to the EU and IMF," said Haris Christou, one young Cypriot speaking for his compatriots. "Am I afraid? Of course I am afraid. Everybody knows everything in Cyprus is going to get bad, really bad. And nobody knows where exactly we are headed."

On Wednesday night men and women, some young, some old, gave voice to that fear. They gathered outside the offices of the European commission, and then lined the road that leads up to Cyprus's colonial-era presidential palace, to protest against a rescue programme that, wittingly or not, will destroy their country's banking sector and bring its economy to its knees.

"Out with the troika", "Fuck the troika", "Go home Troika", said the placards. "No to the policies of austerity." "No to privatisations." "No to the memorandum of catastrophe."

But more than words, or any amount of hoarse chanting, it is uncertainty that now speaks loudest in Cyprus. The uncertainty that has come with the knowledge that the island's economic output will shrink dramatically as a result of the austerity now being demanded in return for €10bn in aid. The uncertainty unleashed by policies that will see many Cypriots wake up with much less than they once had in the bank. And the insecurity of suddenly being the subject of capital controls that possibly could change Cypriots' lives for years.

"Countries don't normally go backwards," said Leda Georgiadou, a woman in her 50s. "With this rescue we have taken a giant leap back into the dark."

On Wednesday, the third day of Cyprus's status as a bailed-out nation, that leap came in the form of restrictions on the movement of money in and out of the divided island.

Anger is now not the only sentiment talking Cyprus. Greek Cypriots are more afraid than their cousins in austerity-whipped Greece because they know that what is heading their way is like nothing else to have hit Europe's southern periphery since the outbreak of the debt crisis.

The closure of the banks, which for the past 12 days has left streets, shops and restaurants eerily quiet – and thousands rushing to cash machines to withdraw money – was the first sign.

"In our case, the dogma of shock started on 15 March with the haircut," said Giorgos Doulouka of the communist Akel party, referring to the massive losses expected to be enforced on depositors holding over €100,000.

"People who bother to attend demonstrations are shocked and terrified, but I can assure you that those who stay at home are shocked and terrified, too."

In the race to prevent a mass capital flight from banks when they finally reopen on Thursday, the central bank has been working around the clock since the announcement of the €10bn aid deal to draw up measures that will stop money flooding out of the island.

At least half of the total €68bn (£58bn) currently deposited in Cyprus – in a banking system that until this week was at least eight times the size of the nation's economy – is held by Russians.

Among the items of emergency legislation being announced was a ban on cheques being cashed, a prohibition on anyone leaving the island with more than €3,000 in banknotes, and the imposition of a €5,000 upper limit on monthly credit card spending. Cash withdrawals have already been limited to €100 following revelations that the island's second largest lender, Laiki, would be shut down altogether.

Already dazed by the news that their once vibrant economy was a basket case – in poorer shape than even that of debt-stricken Greece – it is unclear how Cypriots will react to this latest bombshell.

In a bid to placate them, President Nicos Anastasiades's government has said that the emergency restrictions will be in place for no longer than seven days, to allow the island to come to terms with the fallout from the EU- and IMF-sponsored rescue deal.

"We are like an animal under experiment now," the former governor of Cyprus's central bank, Afxentis Afxentiou, told the Guardian. "I hope that no other country experiences [anything like] it … curtailing deposits has been like an earthquake," he said, lamenting the lack of solidarity shown to Cyprus by fellow eurozone states. "No one, including myself, expected the EU and ECB and IMF to behave in such a manner."

A man of a normally sunny disposition, like so many of his compatriots, Afxentiou admitted that his homeland is likely to feel the full impact of the plummeting living standards that will accompany recession for several years. But he drew strength from the knowledge that Greek Cypriots have been through dark times before – losing more than 70% of the island's resources when Turkey invaded in the wake of a coup aimed at uniting Cyprus with Greece in 1974.

"Forecasts in economy are a very dangerous thing," Afxentiou said. "But what I know is that we have lost everything before, almost all our resources, and rebuilt ourselves and our economy. We can do it again."

G4S on guard

Private security firm G4S, slammed for failing to provide enough security guards for the London Olympics, will dispatch 180 staff to all bank branches across the island in an attempt to ensure that the reopening goes smoothly. Their deployment will keep a lid on any possible trouble, said John Argyrou, managing director of the firm's Cypriot arm. "Our presence there will be for the comfort of both bank staff and clients, but police will also be present."

Argyrou didn't foresee any serious trouble once banks open because people had time to "digest" the extraordinary events of recent weeks. "There may be some isolated incidents, but it's in our culture to be civil and patient, so I don't expect anything serious," he said. A further 120 staff from G4S would be assigned money transport duties, Argyrou added. G4S staff have been working overnight to restock cash machines heavily used since branches were closed nearly a fortnight ago. This year G4S revealed that it had lost £88m over the Olympics fiasco, in which the company was unable to supply all the 10,400 guards it had promised. AP



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« Reply #5362 on: Mar 28, 2013, 06:48 AM »


Cyprus: The clear-out begins

27 March 2013
Politis, Cyprus Mail

“That is just what we needed!” exclaims Politis. On March 27, Bank of Cyprus Executive Director Yiannis Kypri was ousted by the Cyprus Central Bank governor at the request of the EU-ECB-IMF troika. The day before, the bank’s chairman Andreas Artemis had handed in his resignation but this was rejected by the board.

This development in the country’s main bank, due to be restructured as part of the troika bailout plan, comes just as President Nicos Anastasiades announces “an investigative commission to seek out those responsible for the economic crisis,” writes the Cyprus Mail. “Investigation needs to go ahead even if no one is ultimately jailed,” headlines the daily, which concedes that “it may be extremely difficult to bring criminal charges against those who led the economy to the brink of total collapse.” The newspaper points the finger at communist former president Demetris Christofias, adding –

    Is it a criminal offence for a president to be an incompetent and unintelligent populist, clueless about how an economy works, ignorant about the importance of the banking sector and determined to pander to the unions at any cost? The previous president, who would almost certainly be treated as the prime suspect, could claim, in his defence, he was protecting the interests of the working people. Would the governor of the Central Bank also be a suspect under investigation while remaining in his post and exercising his powers? He would repeat what he said during yesterday’s news conference, that he enjoyed the full confidence of the European Central Bank. And he could argue that everything he did was in the knowledge, and with the support, of the ECB.


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« Reply #5363 on: Mar 28, 2013, 06:51 AM »


Croatia: At the end of the EU obstacle course

27 March 2013
Jutarnji List Zagreb

The news has been confirmed: after more than 10 years of negotiations, the Croats are set to join the EU on July 1. Convinced that they had been burned by previous enlargements, the EU’s 27 members were even more strict with Zagreb than they were with other countries which recently joined the Union.
Augustin Palokaj

More than 20 years ago, Germany was the first of the European Union’s member states [there were only 12 at the time] to recognise the Croatian independence. Berlin even threatened to do so unilaterally, if the EU was unable to reach a consensus. However, today Germany is among the last, if not the last, of the EU states to ratify the Treaty of Accession 2011, which will validate Croatia’s entry into the EU.

This is not the end of a love story between Germany and Croatia, nor is it revenge for our World Cup quarter-final victory in 1998. Germany is currently at the head of a group of states that are sceptical about future enlargement, because the government in Berlin is unhappy about the situation in certain countries that have recently joined the Union.

Mistakes were made

With support from the Netherlands, Denmark and Finland, it takes the view that, for political reasons, the EU can no longer afford to overlook the rules for the basic functioning of the Union, that is to say: the rule of law and the drive to fight corruption and organised crime. For this group of states, there can be no compromise on respect for either of these. Germany has even proposed to subject all of the countries of the Union, whether they be recent or long standing members, to supervision from Brussels, which will have the option of imposing sanctions in the form of denial of access to certain funds.

The group of states that have banded with Germany view the enlargement of the EU as one of the most important events in the history of Europe. Denmark and Finland, who both joined the EU through enlargement, believe that the process has marked by number of errors. In short, it appears that some countries that joined the union were not entirely ready. In the run up to its accession, even the European Commission believed that Greece did not fulfill all of the necessary conditions for candidate status. But in view of the Cold War and for other political reasons, the door was held open.

Sometime later, Cyprus succeeded in entering the EU, even though it did not, and still does not, exercise control over all of its territory. At the time, Greece threatened to veto the accession of nine other countries if Cyprus was not included in the group. As for Romania and Bulgaria, a full six years after their accession, both countries still do not fulfill all of the required conditions, and are subject to special supervision from Brussels. When they joined, political considerations were viewed as more important than the technical conditions for accession.

The EU has learned its ‘lesson’

In the Balkans, the states of the former Yugoslavia, and also Albania, interpreted the accession of Bulgaria and Romania as an encouraging sign. The reasoning was: “If they have been given a green light to join the Union, we will also be offered an opportunity for rapid accession.” At least, so they hoped, but the EU had learned its lesson, and the conclusion in Brussels was: “Once bitten twice shy.”

Croatia, which was subjected to stricter accession criteria, became the first country to suffer the consequences of this “lesson”. This explains why the accession process took 10 years to complete. If the same criteria had been previously applied, certain member states would have been unable to enter the EU.

If the latest EU monitoring report is to be believed, Croatia is now ready, and the European Union is preparing to make use of the example of Croatia to restore faith in the credibility of the enlargement process.

From Germany: Zagreb is not ready

Süddeutsche Zeitung has some sceptical words to say about the European Commission’s report on Croatian accession. The Bavarian daily draws attention to outstanding political and economic issues, which it insists Brussels has chosen to ignore —

    Reading the report, you would think you were in another world: its 15 pages make no mention of the botched reforms and the economic crisis that has ravaged the EU for years. All of this has been swept aside to allow the EU to give carte blanche to the accession of Croatia […]

The truth is that, like Greece, Croatia remains marked by clientelist politics, a fragmented administration, a bloated public sector, a justice system that is still dysfunctional in the wake of ineffectual reforms, and a backward economy that is not ready for the EU. This is quite clear from the reports prepared by the IMF, the World Bank Transparency International and the United Nations. However, the European Commission is apparently unaware of all of this.


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« Reply #5364 on: Mar 28, 2013, 06:54 AM »


Czech Republic: ‘Amnesty for Klaus’

Lidové noviny , 28 March 2013

"The controversy over whether Václav Klaus committed treason remains unresolved," notes the Czech daily. The Constitutional Court refused, on March 27, to hear the case brought by the Senate against the former president.

In early March, the upper Chamber passed a bill asking the Court to rule on whether or not Klaus had violated the Constitution when he decreed an amnesty that covers many cases of corruption.

On the morning the ruling was due, the paper announced that Klaus was pursuing a European career, and launching an international alliance of Euro-sceptics.
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« Reply #5365 on: Mar 28, 2013, 06:57 AM »


Spain: ‘Eta decries end of Oslo talks and vows to continue its dialogue and agenda’

27 March 2013
Gara, 27 March 2013

The daily, which is close to the left-wing Basque independence movement, publishes a press release in which the terrorist group warns against the “negative consequences” of the Spanish government’s refusal to negotiate.

The initiative follows Norway’s decision to expel three senior members of Eta who enjoyed diplomatic protection in the country — a move the group described as an "obvious step backwards" which could "cause delay and make the resolution of the conflict more difficult."

Spanish Prime Minister Mariano Rajoy responded by insisting that the definitive dissolution of the terrorist group was the only possible solution.


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« Reply #5366 on: Mar 28, 2013, 06:58 AM »

 SPIEGEL ONLINE
03/27/2013 05:08 PM

Shredded Social Safety Net: European Austerity Costing Lives

As the euro crisis wears on, the tough austerity measures implemented in ailing member states are resulting in serious health issues, a study revealed on Wednesday. Mental illness, suicide rates and epidemics are on the rise, while access to care has dwindled.

The rigid austerity measures brought on by the euro crisis are having catastrophic effects on the health of people in stricken countries, health experts reported on Wednesday.

Not only have the fiscal austerity policies failed to improve the economic situation in these countries, but they have also put a serious strain on their health care systems, according to an analysis of European health by medical journal The Lancet. Major cuts to public spending and health services have brought on drastic deterioration in the overall health of residents, the journal reported, citing the outbreak of epidemics and a spike in suicides.

In addition to crippling public health care budgets, the deep austerity measures implemented since the economic crisis began in 2008 have increased unemployment and lowered incomes, causing depression and prompting sick people to wait longer before seeking help or medication, the study found.

The countries most affected by this have been Portugal, Spain and Greece, the latter of which saw outbreaks of both malaria and HIV after programs for mosquito spraying and needle exchanges for intravenous drug users were axed. There were also outbreaks of West Nile virus and dengue fever.

"Austerity measures haven't solved the economic problems and they have also created big health problems," Martin McKee, a professor of European Public Health at the London School of Hygiene and Tropical Medicine, who led the research, told news agency AP.

It will take years to understand the health consequences of the euro crisis and the policies it has prompted, but some effects are already clear, the study said. Not only has there been an increase of mental disorders in Greece and Spain, but the number of suicides for those younger than 65 has increased in the EU since 2007 -- "reversing a steady decrease." In Greece, the Ministry of Health reported a 40 percent jump in suicides between January and May 2011, compared to the same period the year before.

Officials Accused of Ignoring Problems

While budget cuts have restricted health care access with increased costs for patients in these three nations, Greece has also seen shortages in medication, hospital staff and supplies, according to the study, commissioned in part by the European Observatory on Health Systems and Policies, a partner of the World Health Organization.

The study authors also accuse European officials of failing to address these issues, writing that "public health experts have remained largely silent during this crisis."

"There is a clear problem of denial of the health effects of the crisis, even though they are very apparent," lead researcher McKee told Reuters, comparing their response to the "obfuscation" of the tobacco industry. "The European Commission has a treaty obligation to look at the health effect of all of its policies but has not produced any impact assessment on the health effects of the austerity measures imposed by the troika."

The troika, made up of the European Commission, European Central Bank and International Monetary Fund, has been in charge of bailing out ailing European economies -- most recently in Cyprus -- and of policing the implementation of the austerity measures the study blames for deteriorating health in these countries.

But it doesn't have to be that way, the study suggests, citing Iceland as a success story. Though the country was one of the first to be hit by the financial crisis, it "rejected the economic orthodoxy that advocated austerity … and invested in its people who, evidence suggests, have had very few adverse health consequences."


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« Reply #5367 on: Mar 28, 2013, 07:08 AM »

March 27, 2013

Assad Sends Letter to Emerging Powers Seeking Help to End Syrian War

By RICK GLADSTONE and HALA DROUBI
IHT

President Bashar al-Assad of Syria beseeched a five-nation group of emerging powers on Wednesday to help halt the Syrian conflict, one day after the Arab League moved to further isolate Mr. Assad by ceremoniously filling his government’s vacant seat with the opposition coalition that has sworn to topple him.

In a letter addressed to the leaders of Brazil, Russia, India, China and South Africa — the so-called BRICS group of developing nations, which convened a summit meeting in Durban, South Africa — Mr. Assad framed his request as a plea for assistance in the fight of good against evil. He depicted the opposition forces as terrorists bent on destroying Syria with help from a conspiracy of hostile Arab and Western countries.

“You, with all the huge political, economic and cultural weight you represent that seeks to consolidate peace, security and justice in the troubled world of today, are called upon to exert all possible efforts to end the suffering of the Syrian people,” Mr. Assad said in the letter, as reported by SANA, the official Syria news agency. He called the BRICS group “a just force that seeks to spread peace, security and cooperation among countries away from hegemony, its dictates and oppression which have lasted for decades upon our peoples and nation.”

But there was no indication that the group would align itself with Mr. Assad in the conflict, which has left more than 70,000 people dead and millions displaced.

In a communiqué issued at the end of the summit meeting, the member countries said, “We express our deep concern with the deterioration of the security and humanitarian situation in Syria and condemn the increasing violations of human rights and of international humanitarian law as a result of continued violence.”

The communiqué also said the five countries believed that an agreement reached in Geneva on June 30 under the auspices of the United Nations and the Arab League, aimed at creating a transitional government in Syria, “provides a basis for resolution of the Syrian crisis and reaffirms our opposition to any further militarization of the conflict.”

In a passage that was welcomed by rights groups, which have been critical of the Assad government’s control over where and how international humanitarian aid is distributed inside Syria, the communiqué urged all parties “to allow and facilitate immediate, safe, full and unimpeded access to humanitarian organizations to all in need of assistance.”

Carroll Bogert, the deputy executive director for external relations at Human Rights Watch, who was observing the BRICS meeting, said that passage was potentially significant, particularly if Russia and China, the two members that have defended Mr. Assad’s government, now press him on the aid issue. If that pressure is not forthcoming, she said in a telephone interview, “they’ve made a pretty weak statement on Syria.”

Russia and China, which are permanent members of the United Nations Security Council, have repeatedly thwarted attempts by Western and Arab members to punish Mr. Assad for his repression of a political uprising that began two years ago and that has turned into a civil war.

Brazil, India and South Africa have sought to be more neutral, urging antagonists in the conflict to negotiate a political solution.

On Wednesday, Russia expressed its unhappiness about the Arab League’s decision to award the Assad government seat to the opposition group, the National Coalition of Syrian Revolutionary and Opposition Forces, done with fanfare at a summit meeting in Doha, Qatar, the previous day. Syria was suspended from the 22-nation Arab League in November 2011.

The Russian Foreign Ministry said in a statement posted on its Web site that the Arab League’s decision in filling the seat was “unlawful and invalid” and “completely counter to the common understanding of the need for a peaceful political settlement in Syria and ways to achieve it.”

The opposition coalition’s leader, Sheik Moaz al-Khatib, who took the seat to the applause of fellow Arab League members, castigated Mr. Assad’s government in an emotional acceptance speech, asserting, “What is happening in Syria is a struggle between freedom and slavery, between justice and injustice.”

In terms that oddly foreshadowed Mr. Assad’s own plea to the group of five countries, Sheik Moaz said the uprising was a reflection of resolve by all Syrians who “can no longer tolerate the ongoing slaughter of the Syrian people,” and vowed that his group would now seek wider recognition, including Syria’s seat at the United Nations.

Russia’s disapproval of the Arab League decision was echoed by Iran, Mr. Assad’s only regional ally. Iran’s deputy foreign minister for Arab and African affairs, Hossein Amir-Abdollahian, criticized what he called “hasty measures taken by certain countries by giving the Syrian government’s seat at the Arab League to unauthorized people,” the official Islamic Republic News Agency reported. It quoted him as saying the decision signified “the end of the role of the Arab League in the region.”

Sheik Moaz also used his Arab League acceptance speech to call on NATO publicly to expand its Patriot missile defense shield, now deployed in southern Turkey, to include insurgent-held areas of northern Syria. But NATO, which has made clear that it does not want to become entangled militarily in the Syrian conflict, rejected that request.

The NATO rejection irked Sheik Moaz, who made his feelings known on Wednesday at a ceremony in which Qatar, a major supporter of his coalition, allowed it to occupy Syria’s embassy, which has long been vacant. “Frankly, I got surprised today,” Sheik Moaz said. “I had made a request yesterday, to extend the umbrella of the Patriot missiles to cover 100 kilometers for civilians to defend themselves. For the people, not the revolution. A few hours later they made a statement saying they won’t do that.”

Rick Gladstone reported from New York, and Hala Droubi from Dubai, United Arab Emirates. Lydia Polgreen contributed reporting from Johannesburg.


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« Reply #5368 on: Mar 28, 2013, 07:11 AM »

March 27, 2013

Kenya Opens Hearing on Vote Results

By JEFFREY GETTLEMAN
IHT

NAIROBI, Kenya — With millions of Kenyans staring raptly at television sets and glued to radios, Kenya’s Supreme Court began hearing evidence on Wednesday to resolve the nation’s disputed presidential election as lawyers claimed there had been instances of blatant voter fraud.

Kenyans poured to the polls this month and, according to official election results, Uhuru Kenyatta, a son of Kenya’s first president, squeaked to a first-round victory, clearing the majority threshold by only 8,419 votes out of more than 12 million.

But the second-place finisher, Raila Odinga, Kenya’s prime minister, cried foul, contending that the vote had been rigged. With several nonprofit organizations supporting Mr. Odinga, the case has gone before the Supreme Court, which, for the first time in Kenya’s history, will act as a referee in a potentially combustible struggle for power.

On Wednesday, Kethi Kilonzo, a lawyer representing one of the nonprofit groups, presented the court with evidence — including digital video footage — appearing to show that election results announced at several polling places differed from the final results certified by Kenya’s election commission, giving Mr. Kenyatta several thousand extra votes.

“You take a thousand votes from candidates who didn’t stand a chance and give it to the president-elect?” Ms. Kilonzo said. “My lords, you would think and hope this was an isolated incident, but it wasn’t.”

This election is becoming an anxious, and drawn-out, test for the entire nation, one of the most developed in Africa but one also riddled with deep ethnic divisions and a history of corruption.

The election was held on March 4, and Kenyans on all sides of the political divide have been asked to be patient and await the Supreme Court’s decision, which is expected over the weekend. The court may uphold the results or call for a runoff — or possibly an entirely new election. The last time Kenya had a presidential election dispute, in 2007, more than 1,000 people were killed in ethnic clashes and riots.

Since then, the country has reformed many aspects of its government, especially the Supreme Court, now led by Chief Justice Willy Mutunga, a former human rights lawyer who presides from the bench with a twinkling stud earring in his left ear and an iPad at his fingertips, where a gavel normally would be.

Justice Mutunga and the court’s five other justices are trying to sift through a host of intricate complaints in a very short time, including discrepancies in the voter registry and the crash of the election commission’s computer systems on election day. The commission says the crash was simply a malfunction, but many of Mr. Odinga’s supporters believe it was a conspiracy.

The court decided this week to recount votes from 22 polling stations where questions have been raised. It has also been asked to revisit the issue of whether to consider rejected ballots, like ones put in the wrong ballot box, as part of the total when calculating whether the 50 percent threshold had been passed.

The election commission has stood by the official results, saying they are credible and accurate, and lawyers for the commission were expected to present their defense on Thursday.

In the meantime, Mr. Kenyatta has begun to take on the trappings of the presidency, whisked around Nairobi in a motorcade and meeting with security officials for top-secret briefings. But even if the Supreme Court upholds his victory, Mr. Kenyatta’s court battles are far from over.

Prosecutors at the International Criminal Court in The Hague have charged Mr. Kenyatta with crimes against humanity, accusing him of using his family fortune to bankroll death squads that killed scores of Mr. Odinga’s supporters during the chaos of the 2007 election. Mr. Kenyatta has said the charges are false and based on gossip, and several key witnesses have dropped out.

Fatou Bensouda, the international court’s prosecutor, recently told reporters, “Kenya is the most challenging situation our office has had to deal with.” She cited concerns about intimidation and bribery of witnesses, but vowed to press ahead with the case. “It’s not a question of if it goes to trial, but when,” she said.


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« Reply #5369 on: Mar 28, 2013, 07:13 AM »

 SPIEGEL ONLINE
03/26/2013 05:34 PM

Spy in Cell 15: The Real Story Behind Israel's 'Prisoner X'

Mossad agent Ben Zygier was found hanged in his cell and his case made headlines around the world. New information shows that Zygier, once a passionate Zionist, had become a turncoat who delivered sensitive information to Hezbollah. By SPIEGEL Staff

The guards found the Mossad agent at 8:19 p.m., his lifeless body hanging from a moist sheet. The sheet was tied to the window above the toilet in his prison cell.

The cell in which Ben Zygier died was divided into two sections, one containing a bed, a seating area and a kitchenette, and a separate shower room with a toilet. There were three cameras monitoring the prisoner, but none of the security officers noticed that there had been no signs of life from Zygier in more than an hour. When the guards found him in the shower room, his body had already begun cooling. It was an undignified death for a Zionist who had set out to defend Israel's future. "Our job was to isolate him, not to keep him alive," one of the guards later said.

The Ayalon maximum-security prison, where Zygier was imprisoned, is in Ramla, a suburb in northeast Tel Aviv. There are 700 prisoners and 260 guards at the facility, one of the best guarded prisons in all of Israel. The prisoners in the maximum-security wing are not allowed to use the synagogue or the fitness room, with its punching bag and exercise mats.

Cell No. 15, in which Zygier died, is reserved for enemies of the State of Israel. Yigal Amir, the murderer of former Prime Minister Yitzhak Rabin, was held there. Enemy of the state is also the designation with which Zygier could enter the annals of Israeli history.

It has been two years since the prisoner died, but only now are bits of information coming to light. The case has made headlines around the world, putting both the governments of Israel and Australia on the defensive. In Tel Aviv, the affair has been treated as a state secret with a gag order, which has only recently been loosened, imposed on the media. Conspiracy theories about his fate have been plentiful, including speculation that Zygier was murdered in prison.

Shadow Intelligence War

Now, for the first time, it has become possible to describe what really triggered the agent's imprisonment. For months, a SPIEGEL team from Germany, Israel and Australia looked into the case, conducting interviews with Zygier's former friends and business partners, employees of various intelligence services and governments. The research shows that Zygier -- likely unintentionally -- became one of the most controversial spies in Israeli history, responsible for the arrests of several Lebanese informants who delivered information to the Mossad. He did what no Mossad agent had ever done before in this shadow war of intelligence agencies in the Middle East: He betrayed his country to its mortal enemies.

His story is that of a young man who dreamed of becoming an Israeli hero, one who wanted to prove himself no matter how high the cost. One who failed and saw no other way out than to commit suicide.

There were no indications of this dramatic end when Benjamin Zygier was growing up in a neighborhood in southeast Melbourne. His father Geoffrey, known as a conservative Jew, ran a successful muesli business and was involved in the Jewish community. Ben Zygier attended the best Jewish schools in the city, and joined the leftist Zionist youth organization Hashom Hatzair.

After graduating from high school in 1993, he began studying law at Monash University and eventually announced his intention to move to Israel. "I wasn't very surprised that he had the guts to try something bigger in life than just working as an attorney in a Melbourne law firm," Carolyn Creswell, a friend of the family and Zygier's former English teacher, told Australian reporters.

In 1994, he made his dream reality and moved to the Gazit kibbutz in Israel to find out if the country could become his new homeland.

The kibbutz is in northern Israel, on a road lined with eucalyptus trees as it winds through the hills of Galilee. About 500 people live in Gazit, where low houses with tiled roofs stand in the shadow of Mt. Tabor. In the main office at the kibbutz creamery stands Daniel Leiton, 40, a man with strong hands and an Australian accent. "Ben was an incredible person," says Leiton -- happy, friendly and warm. Leiton says Zygier was one of his best friends.

Tense or Worried?

Zygier and Leiton met in Melbourne in the late 1980s. Though both were still teenagers, they were already Zionists at the time. It was clear to Ben at an early age that he would make Aliyah, says Leiton. Aliyah is the term used by Jews in the diaspora to describe moving to the Holy Land.

Leiton was there when Zygier married his Israeli girlfriend, and he knows the family well. The last time Leiton saw Zygier was in early 2010, in Melbourne, shortly before his arrest.

Was there anything odd about his behavior? Did he seem tense or worried? No, says Leiton. He was the same as always. The notion that his friend committed suicide is "unimaginable," Leiton says quietly, noting that Zygier was not suicidal at all. He can't imagine his friend being kept in isolation, in a maximum-security cell at Ayalon Prison.

What about as a Mossad agent? Leiton swallows and says nothing.

In the kibbutz, Zygier always raved about the Zionist dream, recalls Lior Brand, who lived with Leiton and Zygier in the kibbutz at the time. According to Brand, Zygier was clever, educated and worldly. He was also prepared to defend Israel at all costs. Indeed, he could have been the perfect man for the Mossad.

For decades, the legendary intelligence service has been waging a shadow war against enemies who threaten to obliterate Israel. Mossad agents killed Hezbollah commander Imad Mughniyah in Damascus in 2008 and Hamas commander Mahmoud al-Mabhouh in Dubai in 2010. They have liquidated Iranian nuclear scientists, sabotaged Hezbollah hideouts in Lebanon. The Mossad constantly needs new recruits for this war, which has no beginning and no end.

At the beginning of the new millennium, the agency for the first time ran public ads under its own name. "The Mossad is open. Not to everyone. Not to many. Maybe to you," read the slogan in the agency's campaign for "the job of your life."

The Search for Instability

Men like Zygier, who hold a passport from a country that is above suspicion and can travel without attracting attention, are worth their weight in gold for the intelligence service. Furthermore, under Australian law, citizens may change their names several times and apply for new passports. According to the Australian government, Zygier had three passports. He sometimes traveled as Ben Allen or Ben Alon.

The young Australian travelled back and forth between Israel and Australia. He graduated from law school in Melbourne and began working for a law firm there. He quit his job in 2003 and moved to Tel Aviv, where he began work as a trainee at Herzog, Fox & Ne'eman, one of the country's top law firms. In truth, however, he had applied in response to the Mossad advertisement and also, just to be sure, sent a fax to the Defense Ministry as well.

The Mossad's selection process includes both the background check, which delves deeply into a candidate's family history, and psychological interviews. "We try to ferret out mentally unstable individuals," says one of the doctors who conducts the tests for the Mossad. Motti Kfir, a former Mossad trainer, adds: "Our people should be self-starters but not aggressive, courageous but not without fear, open-minded but tight-lipped."

One of the exercises consists of touching the center of a circle with one's eyes closed. This is impossible, and anyone who does manage to do it must have blinked. It's a test to determine how honest the candidate is. A lie-detector test is also administered at the end of the selection process.

The next phase began in December 2003. Zygier had passed all tests, and the Mossad had accepted him and sent him to an intensive training program that lasts about a year. There, trainees learn various manipulation techniques and how to falsify documents, among other skills.

The Mossad sent him to Europe in early 2005, on his first mission. Zygier was to infiltrate companies that were doing business with Iran and Syria. His target was a company in southern Europe.

The Origins of Betrayal
The firm did business with Iranian companies, and it provided the perfect cover to establish contact with Iran and recruit potential informants. The company was not initiated in the Mossad's plans; Zygier got a job in the bookkeeping department. "It was soon clear to us that he had no experience in this area," says the head of the company in a meeting at a London law firm in mid-March 2013. "But he was so talented that he had soon acquired the necessary skills."

Zygier quickly rose up through the ranks, and he was soon negotiating directly with customers. The head of the company remembers that the Australian was usually the fastest of the employees. "By 11 in the morning, he had finished tasks that would have taken others the entire day." But the head of the company also noticed something else: Zygier quickly lost interest with certain things, he seemed unmotivated and alienated business partners. Indeed, he almost lost one of the company's most important clients. "We had to let him go in late 2006," says the company head. Zygier apparently reacted calmly to the news.

He had similar experiences with other companies. From southern Europe, the Mossad sent him to Eastern Europe, but things never quite clicked. Zygier couldn't deliver, at least not enough. Officials at Mossad headquarters near Tel Aviv were disappointed and recalled him in the summer of 2007.

He was "neither especially good nor especially bad, just mediocre," says a security official familiar with the case. Zygier went from being a field agent to a desk jockey in Tel Aviv.

The Mossad is divided into three large departments. The first one is called "Keshet" ("Rainbow") and is responsible for surveillance and observation operations. The "Caesarea" department, named after the ancient city, is the Mossad's strike force; it carries out attacks abroad. The largest department is called "Tsomet," a Hebrew works meaning "crossroads." It manages sources and analyses information. Zygier was sent back to Tsomet's desks at headquarters.

Vulnerable to Treason

Former Mossad employees describe the work in the Tsomet department as bureaucratic, with the routines like those seen in any government agency. In a change from earlier procedures, when Tsomet was divided into small units, Tsomet employees now have access to far more information. This makes it vulnerable to treason, as the Mossad would soon realize.

In the early morning hours of May 16, 2009, Lebanese special units stormed into the house of Ziad al-Homsi in the western Bekaa Valley and arrested pulled the 61-year-old out of his bed. The arrest warrant accused Homsi of being an Israeli agent. The arrest came as a shock to many Lebanese, not just because Homsi had been the mayor of his town for years. He was also treated as a war hero, because he had fought against Israel during the Lebanese civil war. His supporters could hardly believe what the weeks of subsequent interrogations brought to light: that Homsi had worked as a spy for archenemy Israel since 2006 and was paid about $100,000 (€78,000) for his services.

Homsi's Mossad code name was "Indian," and a detail from his interrogation shows how important he was: He was trying to provide the Israelis access to Hezbollah chief Hassan Nasrallah, who lives in hiding. He was likely paving the way for the next assassination.

The indictment against Homsi revealed the elaborate lengths to which the Mossad went to recruit foreign agents. A Chinese man named "David" had apparently introduced himself to Homsi as an employee with the city government in Beijing and as a representative of a Chinese company that wanted to establish business ties. At a meeting in Lebanon, "David" then invited Homsi to Beijing to attend a trade fair, telling him that the invitation had come directly from the Chinese government. Additional meetings in Bangkok followed, and the Chinese enticed the Lebanese with a monthly salary of $1,700. Then they began asking questions. For instance, they asked, what did Homsi know about three Israeli soldiers who had been missing since the 1982 war with Lebanon, in which Homsi had fought on the side of the Arabs?

"This is the moment at which the defendant becomes aware that he is dealing with Israelis, who work for the Mossad and have nothing to do with import-export companies or services that search for missing people," the indictment reads.

Cracking Israeli Spy Rings

The Mossad provided Homsi with a computer and a doctored USB flash drive, as well as a device that looked like a stereo system but was in fact a transmitter for sending messages. According to the indictment, the spy sent reports to Tel Aviv every five days. The technology was found during his arrest in May 2009. Homsi, says General Ashraf Rifi, the head of the Lebanon intelligence service, was one of the most important catches his agency had ever made. Homsi was sentenced to 15 years in prison with hard labor, though was later amnestied.

During that spring of 2009, the Lebanese cracked several Israeli spy rings in Lebanon. Among those arrested was Mustafa Ali Awadeh, code name "Zuzi," another important mole within Hezbollah.

For the Israelis, it was the biggest intelligence setback in the region in decades. Officials at Mossad headquarters were baffled. How did the Lebanese manage to track down the Israeli sources?

Then a tip was received from Lebanon: There had been talk within Hezbollah of a Mossad agent who was in Australia at the time. It was soon clear that the agent had to be Ben Zygier.

Zygier, frustrated by his desk job, had requested leave so that he could go back to school to earn a master's degree in management. The Mossad even continued to pay the agent's salary. In October 2008, Zygier enrolled at Monash University in Melbourne again, this time under the name "Ben Allen." He explained that he had worked for a consulting firm in Geneva and that he occasionally had to return to Switzerland for the firm. It explained his many trips.

On a Sunday in October 2009, SPIEGEL employee Jason Koutsoukis, who was working as a Middle East correspondent for the Australian newspapers The Age and Sydney Morning Herald at the time, received an encrypted email apparently from an Australian government employee. "Intelligence investigations have uncovered one particular Israeli agent of Australian birth who is currently living back in Australia. There is even the suspicion that he is involved in an active Mossad operation in this country," the email read. Another email mentions the company where Zygier worked in 2005. The Australians had apparently been observing Zygier's activities for some time.

Koutsoukis called Zygier in early December 2009 and confronted him with the accusations. "That's a total fantasy," Zygier replied before hanging up. There was a second conversation a few weeks later, in mid-January 2010.

A Shock to the Mossad

"I have information to the effect that you worked for a European company. Can you tell me what you did there?" Koutsoukis asked.

"I don't know what you're talking about," Zygier replied. "You must have me confused with someone else."

Ten days later, the Israeli domestic intelligence service arrested Zygier after the Mossad had asked him to return to headquarters to discuss the warning received from Beirut.

The story revealed by internal investigations came as a shock to the Mossad. Apparently Zygier, frustrated by the setbacks and what he felt was a demotion, tried to find new sources -- presumably in an effort to rehabilitate himself and prove how valuable he was. According to the investigation, Zygier admitted during several interrogations that, prior to his departure for Australia, he had without authorization met with a Hezbollah associate in Eastern Europe to recruit him as a source.

What Zygier didn't know: The Hezbollah associate reported the meeting to Beirut and began playing a double game. He persuaded Zygier that he was interested in working with him, but he coordinated every step he took with the Hezbollah intelligence service. Even Nasrallah himself was informed.

The contact between Zygier and Hezbollah went on for months, and at some point it was no longer clear who was managing whom as a source. The Lebanese official lured Zygier, and he asked for proof that the Australian was indeed working for the Mossad. The investigation report indicates that Zygier began supplying the Lebanese with intelligence information from Tel Aviv, including information relating to the spy ring of Ziad al-Homsi and Mustafa Ali Awadeh, the Mossad's two top informants in Lebanon, who were exposed as a result.

When he was arrested, the agents found a CD with additional classified information that was apparently from the Tsomet department, say Israeli officials with access to the investigation. Zygier never managed to deliver the CD.

The Dark Side

Tel Aviv, early March 2013. "Zygier wanted to achieve something that he didn't end up getting," says a senior government official who is familiar with the investigation. "And then he ended up on a precipitous path. He crossed paths with someone who was much more professional than he was." At some point, says the Israeli, Zygier crossed a red line and went to the dark side.

The Australian government also launched an investigation. If it was true that Zygier had used his passport "for the work of the Israeli intelligence service," it would raise "significant questions," a report by the Australian Foreign Ministry reads.

Israeli informants have certainly changed sides in the past. But a regular Mossad employee has never done what Zygier did. It is a bitter defeat for Israel, but for Hezbollah it is one of the rare instances in which an Arab intelligence service prevailed over its Jewish counterpart. Zygier's betrayal is also a heavy blow to the Mossad because it raises doubts as to the integrity of the agency's own people -- and the manner in which it recruits employees.

Lior Brand, one of Zygier's friends from the Gazit kibbutz, believes that Zygier simply wasn't up to the task. The lies, the silence and the loneliness were too much. The Mossad "made a big mistake" by recruiting him, says Brand, adding that he cannot forgive the agency.

Israeli intelligence agencies wanted to set an example and indicated to Zygier's attorney that they wanted him to spend at least 10 years in prison. While he was in custody, in the summer of 2010, Zygier's second daughter was born, and the family was permitted to visit him. Zygier was allowed to talk to his mother Louise on the phone on Dec. 15, 2010. He was dead a few hours later.

One can only speculate over the true reasons for Zygier's suicide.

what truly motivated Zygier. Wounded pride? Shame? Revenge? His parents could perhaps answer these questions, but they are saying nothing. Money, all involved seem to agree, did not play a role in the case.

After the Israeli security officials had released Zygier's body, the family invited his closest friends to the funeral, including Daniel Leiton from Gazit. Leiton went to the cemetery and asked why Zygier, just 34 years old, had to die, but he received no answer. He loved Israel, Leiton says, adding that something went terribly wrong.

The parents had an inscription engraved on the polished black tombstone: "May his soul be bound in the bundle of life." Zygier was buried in the Jewish cemetery of Springvale. In Australia, not in Israel.

BY RONEN BERGMAN, JULIA AMALIA HEYER, JASON KOUTSOUKIS, ULRIKE PUTZ and HOLGER STARK

Translated from the German by Christopher Sultan


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