Obma to Wall Street: "Act Responsibly!"

On the eve of Pittsburgh's G-20 Summit, the President tells Wall Street to get its act together:

At the same time, we have to recognize that what's needed now goes beyond just the reforms that I've mentioned. For what took place one year ago was not merely a failure of regulation or legislation; it wasn't just a failure of oversight or foresight. It was also a failure of responsibility -- it was fundamentally a failure of responsibility -- that allowed Washington to become a place where problems -- including structural problems in our financial system -- were ignored rather than solved. It was a failure of responsibility that led homebuyers and derivative traders alike to take reckless risks that they couldn't afford to take. It was a collective failure of responsibility in Washington, on Wall Street, and across America that led to the near-collapse of our financial system one year ago.

So restoring a willingness to take responsibility -- even when it's hard to do -- is at the heart of what we must do. Here on Wall Street, you have a responsibility. The reforms I've laid out will pass and these changes will become law. But one of the most important ways to rebuild the system stronger than it was before is to rebuild trust stronger than before -- and you don't have to wait for a new law to do that. You don't have to wait to use plain language in your dealings with consumers. You don't have to wait for legislation to put the 2009 bonuses of your senior executives up for a shareholder vote. You don't have to wait for a law to overhaul your pay system so that folks are rewarded for long-term performance instead of short-term gains.

The fact is, many of the firms that are now returning to prosperity owe a debt to the American people. They were not the cause of this crisis, and yet American taxpayers, through their government, had to take extraordinary action to stabilize the financial industry. They shouldered the burden of the bailout and they are still bearing the burden of the fallout -- in lost jobs and lost homes and lost opportunities. It is neither right nor responsible after you've recovered with the help of your government to shirk your obligation to the goal of wider recovery, a more stable system, and a more broadly shared prosperity.

So I want to urge you to demonstrate that you take this obligation to heart. To put greater effort into helping families who need their mortgages modified under my administration's homeownership plan. To help small business owners who desperately need loans and who are bearing the brunt of the decline in available credit. To help communities that would benefit from the financing you could provide, or the community development institutions you could support. To come up with creative approaches to improve financial education and to bring banking to those who live and work entirely outside of the banking system. And, of course, to embrace serious financial reform, not resist it.

Just as we are asking the private sector to think about the long term, I recognize that Washington has to do so as well. When my administration came through the door, we not only faced a financial crisis and costly recession, we also found waiting a trillion dollar deficit. So yes, we have to take extraordinary action in the wake of an extraordinary economic crisis. But I am absolutely committed to putting this nation on a sound and secure fiscal footing. That's why we're pushing to restore pay-as-you-go rules in Congress, because I will not go along with the old Washington ways which said it was okay to pass spending bills and tax cuts without a plan to pay for it. That's why we're cutting programs that don't work or are out of date. That's why I've insisted that health insurance reform -- as important as it is -- not add a dime to the deficit, now or in the future.

There are those who would suggest that we must choose between markets unfettered by even the most modest of regulations, and markets weighed down by onerous regulations that suppress the spirit of enterprise and innovation. If there is one lesson we can learn from last year, it is that this is a false choice. Common-sense rules of the road don't hinder the market, they make the market stronger. Indeed, they are essential to ensuring that our markets function fairly and freely.

Personally, I favor more than self-regulation...perhaps a special financial-services tax on Wall Street companies and executives, to help repay the bailout...and who knows, maybe it could pay for single-payer health-care, too?

Hero of the Day: Judge Jed S. Rakoff

From the Washington Post:

A federal judge in New York Monday rejected a $33 million settlement between the Securities and Exchange Commission and Bank of America, throwing into doubt the future of one of the government's chief cases against a firm charged with wrongdoing in the financial crisis.

Using biting language, Judge Jed S. Rakoff accused the SEC, Wall Street's top regulator, of trying to nab a quick victory against a big bank while concealing the true facts of the wrongdoing the agency alleges. He attacked Bank of America's top executives for allegedly trying to protect themselves at the expense of the company's shareholders. Most of all, Rakoff suggested that the SEC and Bank of America are working together to try to make the case go away even if it "victimizes" the shareholders who would be responsible for paying the $33 million settlement.

"This case suggests a rather cynical relationship between the parties: the S.E.C. gets to claim that it is exposing wrongdoing on the part of the Bank of America in a high-profile merger; the Bank's management gets to claim that they have been coerced into an onerous settlement by overzealous regulators," Rakoff wrote. "And all this is done at the expense, not only of the shareholders, but also of the truth."

Rakoff has ordered that the case move to trial early next year. The SEC could also choose to drop it, renegotiate the settlement or possibly appeal.

The case centers on whether Bank of America hid from shareholders important details about its plans for Merrill Lynch, the troubled Wall Street firm it agreed to acquire last fall in a hastily arranged deal aimed at containing further damage to the financial system. Early last month, the SEC claimed that Bank of America failed to disclose to shareholders who were to vote on the deal that it had allowed payment of billions of dollars in bonuses to Merrill Lynch employees. Bank of America agreed to pay $33 million to settle the charges.

But Rakoff, who must sign-off on the settlement, expressed immediate skepticism, demanding additional information from the SEC and Bank of America and summoning their lawyers to the court. Though the SEC and Bank of America were on opposing sides of the case, they joined in an awkward marriage of arguments for why the settlement was proper.

NY: Going Dutch for 400 Years...

The Dutch Royal Family sent Prince Willem-Alexander and Princess Máxima of the House of Orange to congratulate New York City as well as President and Mrs. Obama on 400 years of Dutch-American friendship. Here's a link to the NY400 website.

As my mother was born in Scheveningen, and came to New York as a refugee from Hitler, where she worked for the Dutch Ministry of Shipping (of the government-in-exile)I think it is very nice.

To all our Dutch readers: Gelukwensen!

It's Official: Washington Replaces NYC as America's Financial Capital

According to David Cho in yesterday's Washington Post:

As financial firms navigate a life more closely connected to government aid and oversight than ever before, they increasingly turn to Washington, closing a chasm that was previously far greater than the 228 miles separating the nation's political and financial capitals.

In the year since the investment bank Lehman Brothers collapsed, paralyzing global markets and triggering one of the biggest government forays into the economy in U.S. history, Wall Street has looked south to forge new business strategies, hew to new federal policies and find new talent.

"In the old days, Washington was refereeing from the sideline," said Mohamed A. el-Erian, chief executive officer of Pimco. "In the new world we're going toward, not only is Washington refereeing from the field, but it is also in some respects a player as well. . . . And that changes the dynamics significantly."

Washington has become a dominant player. Over the past year, the Federal Reserve and the Treasury have injected trillions of dollars into frozen financial markets, snapping up unwanted bonds, extending guarantees to banks and slashing interest rates.

Three times as much U.S. taxpayer money has gone into propping up a single firm, insurance giant American International Group, as the world spent a decade ago during the financial rescue of South Korea, then the world's 11th-largest economy. And the emergency bailout of financial firms that Congress approved last year has cost nearly as much as the first five years of the war in Iraq.

Now the Treasury and the Federal Reserve are embroiled in everything from credit cards and home loans to auto manufacturing, from overseeing executive pay to shaping boards of directors.

In response, senior executives of major financial companies are traversing the Beltway to meet lawmakers in person for the first time. Firms such as Fidelity Investments, BNY Mellon and even Goldman Sachs, which has prospered in the crisis relative to many other banks, are opening additional offices or bulking up their staffs in the capital.

All Universities to Become Stanley Kaplan

that's apparntly the bottom line of Zephyr Teachout's story in yesterday's Washington Post about the future of online education (The Post owns Stanley Kaplan, a fact not disclosed by the article):

When this happens -- be it in 10 years or 20 -- we will see a structural disintegration in the academy akin to that in newspapers now. The typical 2030 faculty will likely be a collection of adjuncts alone in their apartments, using recycled syllabuses and administering multiple-choice tests from afar.

President Obama Commemorates 9/11

The official transcript:

For Immediate Release September 11, 2009

REMARKS BY THE PRESIDENT
AT WREATH-LAYING CEREMONY
AT THE PENTAGON MEMORIAL

The Pentagon
Arlington, Virginia

9:34 A.M. EDT

THE PRESIDENT: Secretary Gates, Admiral Mullen and members of the Armed Forces, fellow Americans, family and friends of those that we lost this day -- Michelle and I are deeply humbled to be with you.

Eight Septembers have come and gone. Nearly 3,000 days have passed -- almost one for each of those taken from us. But no turning of the seasons can diminish the pain and the loss of that day. No passage of time and no dark skies can ever dull the meaning of this moment.

So on this solemn day, at this sacred hour, once more we pause. Once more we pray -- as a nation and as a people; in city streets where our two towers were turned to ashes and dust; in a quiet field where a plane fell from the sky; and here, where a single stone of this building is still blackened by the fires.

We remember with reverence the lives we lost. We read their names. We press their photos to our hearts. And on this day that marks their death, we recall the beauty and meaning of their lives; men and women and children of every color and every creed, from across our nation and from more than 100 others. They were innocent. Harming no one, they went about their daily lives. Gone in a horrible instant, they now "dwell in the House of the Lord forever."

We honor all those who gave their lives so that others might live, and all the survivors who battled burns and wounds and helped each other rebuild their lives; men and women who gave life to that most simple of rules: I am my brother's keeper; I am my sister's keeper.

We pay tribute to the service of a new generation -- young Americans raised in a time of peace and plenty who saw their nation in its hour of need and said, "I choose to serve"; "I will do my part." And once more we grieve. For you and your families, no words can ease the ache of your heart. No deeds can fill the empty places in your homes. But on this day and all that follow, you may find solace in the memory of those you loved, and know that you have the unending support of the American people.

Scripture teaches us a hard truth. The mountains may fall and the earth may give way; the flesh and the heart may fail. But after all our suffering, God and grace will "restore you and make you strong, firm and steadfast." So it is -- so it has been for these families. So it must be for our nation.

Let us renew our resolve against those who perpetrated this barbaric act and who plot against us still. In defense of our nation we will never waver; in pursuit of al Qaeda and its extremist allies, we will never falter.

Let us renew our commitment to all those who serve in our defense -- our courageous men and women in uniform and their families and all those who protect us here at home. Mindful that the work of protecting America is never finished, we will do everything in our power to keep America safe.

Let us renew the true spirit of that day. Not the human capacity for evil, but the human capacity for good. Not the desire to destroy, but the impulse to save, and to serve, and to build. On this first National Day of Service and Remembrance, we can summon once more that ordinary goodness of America -- to serve our communities, to strengthen our country, and to better our world.

Most of all, on a day when others sought to sap our confidence, let us renew our common purpose. Let us remember how we came together as one nation, as one people, as Americans, united not only in our grief, but in our resolve to stand with one another, to stand up for the country we all love.

This may be the greatest lesson of this day, the strongest rebuke to those who attacked us, the highest tribute to those taken from us -- that such sense of purpose need not be a fleeting moment. It can be a lasting virtue.

For through their own lives –- and through you, the loved ones that they left behind –- the men and women who lost their lives eight years ago today leave a legacy that still shines brightly in the darkness, and that calls on all of us to be strong and firm and united. That is our calling today and in all the Septembers still to come.

May God bless you and comfort you. And may God bless the United States of America. (Applause.)

END
9:40 A.M. EDT

Vice-President Biden attended a ceremony in New York City.

NATO Forces Killed Afghan NY Times Hostage in Botched Raid

According to David Batty's report in The Guardian (UK), NY Times reporter Sultan Munadi was killed by NATO forces in the botched raid that freed British reporter Stephen Farrell:

Farrell said today that he and Munadi fled the Taliban compound in Kunduz as a Nato helicopter, carrying British and American soldiers, swooped in from the night sky. "We thought they would kill us. We thought should we go out," he told a colleague in Kabul.

As bullets flew, the two men sprinted for cover, protected by a wall. Munadi moved forward, shouting "journalist, journalist", but fell in a hail of bullets, Farrell said.

Farrell dived into a ditch and, hearing British voices, shouted "British journalist".

More from the BBC, in a story headlined "Afghan rescue death causes anger:"

There is growing anger within Afghanistan about the local journalist's death and the way the incident was reported.

A group of Afghan journalists have accused the troops of having double standards when it comes to Western and Afghan lives.

Still more from the AP:

KABUL — Afghan journalists blamed international troops Thursday for the death of a kidnapped colleague during a rescue operation and said British commandos showed a "double standard" by leaving his body while retrieving a foreign New York Times writer.

The newly formed Media Club of Afghanistan — a group of Afghan reporters who work with international news outlets — also condemned the Taliban for abducting both men last week in northern Afghanistan as they investigated reports of civilian deaths in a German-ordered airstrike.

Local journalists laid flowers Thursday at the grave of reporter and translator Sultan Munadi in Kabul. Munadi, 34, was killed by gunfire during a British commando raid Wednesday to free him and New York Times writer Stephen Farrell.

Munadi was shot during the raid, but Farrell survived and was taken away in a helicopter. One British commando was killed in the raid.

At Thursday's ceremony, the group issued a statement holding international forces responsible for launching a military operation to free the journalists without exhausting nonviolent channels.

The statement also said it was "inhumane" for the British forces to rescue Farrell, who has dual British-Irish nationality, and also retrieve the body of the commando killed in the raid while leaving behind Munadi's body.

Fazul Rahim, an Afghan producer for CBS News, said the foreign forces' actions showed a lack of respect.

"It shows a double standard between a foreign life and an Afghan life," he said.

And even more, from AFP:

Munadi's brother said negotiators were on the brink of winning their release and slammed the raid as "thoughtless" despite insistence from British Foreign Secretary David Miliband that it was the only way to secure their freedom.

"There was no need for this operation at all," Munadi's brother Mohammad Osman told AFP.

"The ICRC (the International Committee of the Red Cross), the United Nations, tribal elders were all involved in optimistic negotiations for their release, when all of sudden this raid took place," he added.

"This was a totally thoughtless raid resulting in the martyrdom of Sultan."

Colleagues of Munadi are outraged that his bullet-riddled body was abandoned at the scene and hundreds of mourners attended a prayer ceremony at a Kabul mosque to pay their respects to the reporter on Friday.

His photo sat in a wreath of flowers, where a sign read: "We want an explanation for the killing of young journalist Sultan Ahmad Munadi."

Why Did Netanyahu Go To Moscow Monday?

According to The Jerusalem Post, quoting Kommersant:

A senior Kremlin official confirmed Wednesday to the Russian paper Kommersant thatPrime Minister Binyamin Netanyahu did indeed make a clandestine trip to Russia on Monday.

Mystery surrounds Netanyahu's 'secret trip to Russia'

Commenting on the visit, the official said that "this kind of development could only be related to new and threatening information on Iran's nuclear program."

The Russian newspaper quoted experts speculating that such a trip would only be justified under extraordinary circumstances, "for example, in the case of Israel planning to attack Iran."

Human Rights Watch "Expert" Collects Nazi Regalia

I'm not making this up, either. From NGO Monitor:

“That is so cool! The leather SS jacket makes my blood go cold it is so COOL!” --Flak88 (aka Marc Garlasco), wehrmacht-awards.com, 2005

“To imply that Garlasco’s collection is evidence of Nazi sympathies is not only absurd but an attempt to deflect attention” --HRW statement, September 8, 2009

On September 8, Omri Ceren (MereRhetoric) published a fully documented report clearly showing that Human Rights Watch’s “senior military expert” and coauthor of numerous reports condemning Israel, Marc Garlasco, is an avid collector of Nazi memorabilia. This revelation follows NGO Monitor’sresearch report on HRW’s pattern of false and unsupported claims in relation to Israel, and lack of professionalism and anti-Israel activism among some HRW officials, particularly in the Middle East and North Africa division.

Meet the US State Department's Official Blogger

His name is P.J. Crowley, Assistant Secretary of State for Public Affairs. The State Department now shows a new motto on its website: "Diplomacy In Action." The blog is called DipNote.

(I'm not making this up.)

Ted Kennedy's "Last Hurrah"

As I mentioned in a post after Ted Kennedy's Arlington funeral, he has continued politicking from beyond the grave, much like Mayor Skeffington as played by Spencer Tracy. So, not surprisingly, last night's speech by President Obama had its own "Win One for the Gipper" moment, featuring excerpts from Senator Kennedy's letter to President Obama. Today, Talking Points Memo published the full text:

Dear Mr. President,

I wanted to write a few final words to you to express my gratitude for your repeated personal kindnesses to me - and one last time, to salute your leadership in giving our country back its future and its truth.

On a personal level, you and Michelle reached out to Vicki, to our family and me in so many different ways. You helped to make these difficult months a happy time in my life.

You also made it a time of hope for me and for our country.

When I thought of all the years, all the battles, and all the memories of my long public life, I felt confident in these closing days that while I will not be there when it happens, you will be the President who at long last signs into law the health care reform that is the great unfinished business of our society. For me, this cause stretched across decades; it has been disappointed, but never finally defeated. It was the cause of my life. And in the past year, the prospect of victory sustained me-and the work of achieving it summoned my energy and determination.

There will be struggles - there always have been - and they are already underway again. But as we moved forward in these months, I learned that you will not yield to calls to retreat - that you will stay with the cause until it is won. I saw your conviction that the time is now and witnessed your unwavering commitment and understanding that health care is a decisive issue for our future prosperity. But you have also reminded all of us that it concerns more than material things; that what we face is above all a moral issue; that at stake are not just the details of policy, but fundamental principles of social justice and the character of our country.

And so because of your vision and resolve, I came to believe that soon, very soon, affordable health coverage will be available to all, in an America where the state of a family's health will never again depend on the amount of a family's wealth. And while I will not see the victory, I was able to look forward and know that we will - yes, we will - fulfill the promise of health care in America as a right and not a privilege.

In closing, let me say again how proud I was to be part of your campaign- and proud as well to play a part in the early months of a new era of high purpose and achievement. I entered public life with a young President who inspired a generation and the world. It gives me great hope that as I leave, another young President inspires another generation and once more on America's behalf inspires the entire world.

So, I wrote this to thank you one last time as a friend- and to stand with you one last time for change and the America we can become.

At the Denver Convention where you were nominated, I said the dream lives on.

And I finished this letter with unshakable faith that the dream will be fulfilled for this generation, and preserved and enlarged for generations to come.

With deep respect and abiding affection,

[Ted]

IMHO, If President Obama can't pass a bill this year with the considerable help of Ted Kennedy's ghost, he's not the politician I think he is...

Dan Brown's Washington

In today's Washington Post Style section, a Masonic tour of Washington, DC, tied to Dan Brown's newest best-seller, The Lost Symbol.

USAID Funded Iraqi Insurgents, Too...

Recent reports of USAID funding for Afghan Taliban reminded of this earlier story from Bill Easterly's AIDWatch blog:

...namely a 2008 audit that found evidence of fraud, phantom workers, and money being diverted to insurgents through trash collection contracts.

Steve Jobs, Live and In Person...

Federal Reserve Policies Corrupted Economics Profession

So says Ryan Grim in today's Huffington Post:

Galbraith, a Fed critic, has seen the Fed's influence on academia first hand. He and co-authors Olivier Giovannoni and Ann Russo found that in the year before a presidential election, there is a significantly tighter monetary policy coming from the Fed if a Democrat is in office and a significantly looser policy if a Republican is in office. The effects are both statistically significant, allowing for controls, and economically important.

They submitted a paper with their findings to the Review of Economics and Statistics in 2008, but the paper was rejected. "The editor assigned to it turned out to be a fellow at the Fed and that was after I requested that it not be assigned to someone affiliated with the Fed," Galbraith says.

Publishing in top journals is, like in any discipline, the key to getting tenure. Indeed, pursuing tenure ironically requires a kind of fealty to the dominant economic ideology that is the precise opposite of the purpose of tenure, which is to protect academics who present oppositional perspectives.

And while most academic disciplines and top-tier journals are controlled by some defining paradigm, in an academic field like poetry, that situation can do no harm other than to, perhaps, a forest of trees. Economics, unfortunately, collides with reality -- as it did with the Fed's incorrect reading of the housing bubble and failure to regulate financial institutions. Neither was a matter of incompetence, but both resulted from the Fed's unchallenged assumptions about the way the market worked.

Even the late Milton Friedman, whose monetary economic theories heavily influenced Greenspan, was concerned about the stifled nature of the debate. Friedman, in a 1993 letter to Auerbach that the author quotes in his book, argued that the Fed practice was harming objectivity: "I cannot disagree with you that having something like 500 economists is extremely unhealthy. As you say, it is not conducive to independent, objective research. You and I know there has been censorship of the material published. Equally important, the location of the economists in the Federal Reserve has had a significant influence on the kind of research they do, biasing that research toward noncontroversial technical papers on method as opposed to substantive papers on policy and results," Friedman wrote.

Afghanistan 2009 v Chicago 2008

Someone I know suggested that I take a look at US 2008 Presidential election results, precinct-by-precinct, when considering the Obama Administration's reported objections to recent polling in Afghanistan--since New York Times "journalists" Mark Landler and Helene Cooper had not bothered to do their homework. It's not hard. Here's a link to the Chicago Elections website. It shows, for example, that in Wards 3 to 9, President Obama and Vice-President Biden received over 95 percent of the votes cast:

Ward 3--97.05%
Ward 4--97.07%
Ward 5--97.13%
Ward 6--99.25%
Ward 7--98.69%
Ward 8--99.19%
Ward 9--98.80%

There was a similar pattern In my hometown of Washington, DC.:

Precinct 20--96.58%
Precinct 114--99.45%
Precinct 115--99.33%
Precinct 116--99.09%
Precinct 120--98.79%

So, I don't think that the Obama administration would ever choose to set aside votes in the United States in the way US Ambassador Karl W. Eikenberry has advocated doing in Afghanistan...

All the College Courses You Can Take For $99/Month

A teaching colleague sent me a link to this article by Kevin Carey from the Washington Monthly:

StraighterLine is the brainchild of a man named Burck Smith, an Internet entrepreneur bent on altering the DNA of higher education as we have known it for the better part of 500 years. Rather than students being tethered to ivy-covered quads or an anonymous commuter campus, Smith envisions a world where they can seamlessly assemble credits and degrees from multiple online providers, each specializing in certain subjects and—most importantly—fiercely competing on price. Smith himself may be the person who revolutionizes the university, or he may not be. But someone with the means and vision to fundamentally reorder the way students experience and pay for higher education is bound to emerge.

In recent years, Americans have grown accustomed to living amid the smoking wreckage of various once-proud industries—automakers bankrupt, brand-name Wall Street banks in ruins, newspapers dying by the dozen. It’s tempting in such circumstances to take comfort in the seeming permanency of our colleges and universities, in the notion that our world-beating higher education system will reliably produce research and knowledge workers for decades to come. But this is an illusion. Colleges are caught in the same kind of debt-fueled price spiral that just blew up the real estate market. They’re also in the information business in a time when technology is driving down the cost of selling information to record, destabilizing lows.

In combination, these two trends threaten to shake the foundation of the modern university, in much the same way that other seemingly impregnable institutions have been torn apart. In some ways, the upheaval will be a welcome one. Students will benefit enormously from radically lower prices—particularly people like Solvig who lack disposable income and need higher learning to compete in an ever-more treacherous economy. But these huge changes will also seriously threaten the ability of universities to provide all the things beyond teaching on which society depends: science, culture, the transmission of our civilization from one generation to the next.

Whether this transformation is a good or a bad thing is something of a moot point—it’s coming, and sooner than you think...

The Ascent (1977)

The other night, someone I know and this blogger watched Laura Shepitko's 1977 Russian classic, The Ascent, which we had ordered from Netflix. It is a harrowing film, a WWII horror picture set in what seems to be the Ukraine or Belarus, full of Russian Orthodox religious symbolism, including shots that look like icons painted by Andrey Rublev, set in landscapes by Levitan (although in Black & White). Shepitko died at age 40, in a car accident, shortly after making this film. She was married to Elim Klimov, whose Come and See explored similar themes, in a less religious way....

From Our "Told You So" Department: USAID Funded Taliban in Afghanistan

From Jean MacKenzie's story on GlobalPost.com (ht The Newshour With Jim Lehrer):

KABUL — The United States Agency for International Development has opened an investigation into allegations that its funds for road and bridge construction in Afghanistan are ending up in the hands of the Taliban, through a protection racket for contractors.

And House Foreign Affairs Committee member, Rep. Bill Delahunt (D-Mass.) vowed to hold hearings on the issue in the fall, saying: "The idea that American taxpayer dollars are ending up with the Taliban is a case for grave concern."

U.S. officials confirmed that the preliminary investigation and the proposed hearings were sparked by a GlobalPost special report on the funding of the Taliban last month that uncovered a process that has been an open secret in Afghanistan for years among those in international aid organizations.

The report exposed that the Taliban takes a percentage of the billions of dollars in aid from U.S. and other international coalition members that goes to large organizations and their subcontractors for development projects, in exchange for protection in remote areas controlled by the insurgency.

I wrote about a different aspect of this problem in a February 2007 ORBIS article, NGOs: A ‘New Class’ in International Relations:

Nongovernmental organizations have attempted to take control of civil society, displacing traditional governing institutions. This serves the interests of the terrorists, warlords, and mafia dons, who benefit from weak central government, and hinders the West's ability to mobilize allies to participate in the war on terror. NGO leaders who are hostile to the nation-state itself seek to transform a voluntary system of participation in international organizations by sovereign member-states via a “power shift” to an unholy alliance of multinational corporations and NGOs. Since they do not possess the traditional sources of legitimacy enjoyed by nation-states, they seek to impose their will by financial or forceful means—for example, “sanctions” or “humanitarian intervention.” A new class of NGOs has thus emerged that is essentially opposed to the diplomatic, legal, and military measures required for dealing with civilizational conflict.

Minister Confesses UK Traded Pan Am Bomber for BP-Libya Oil Deal

In an item from the Press Association (UK), Justice Minister Jack Straw takes a fall for Prime Minister Gordon Brown:

But Mr Straw said the issue of trade played "a very big part" in his decision to include Megrahi in a prisoner transfer agreement (PTA) struck with Libya in 2007, citing a lucrative deal which was being sought by British oil giant BP at the time.

Documents released earlier this week showed Mr Straw assured the Scottish Government in 2007 that Megrahi would be excluded from any PTA agreed with the regime of Colonel Muammar Gaddafi as part of the normalisation of relations between the UK and Libya. But just weeks later, he informed Edinburgh that he had not been able to secure an exemption for Megrahi and had decided to go ahead with the PTA as it stands "in view of the overwhelming interests of the United Kingdom".

Asked whether trade was a factor in his decision, Mr Straw told the Daily Telegraph: "Yes... a very big part of that. I'm unapologetic about that. Libya was a rogue state... We wanted to bring it back into the fold. And yes, that included trade because trade is an essential part of it and subsequently there was the BP deal."

Mr Straw said Mr Brown was not involved in the decision to press ahead with the PTA, saying: "I certainly didn't talk to the PM. There is no paper trail to suggest he was involved at all."

In January 2008, just weeks after the PTA was sealed, Libya ratified a £550 million oil deal with BP.