WikiLeaks Unveils TPP Secret Documents

The Trans-Pacific Partnership (TPP) is a proposed trade and investment agreement, that involves 12 nations from Asia Pacific led by the US. The member states are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. 

It’s been a controversial agreement that has raised various protests because of the secrecy of negotiations covering the agreement's expansive scope, and the attendant controversial clauses in drafts that  previously has been leaked to the public.

Austrian economist Dr. Richard Ebeling at the Epic Times clarified that this hasn’t been a free trade agreement: (bold mine)

What should be most clear is that the Trans-Pacific Partnership is not a free trade agreement. Parts of it may, no doubt, lower some trade barriers, thus making easier the production, sale and purchase of a wider variety of imports and exports. However, TPP, like all other trade agreements in the post-World War II era is a managed trade agreement.

That is, governments of the respective participating nations negotiate on the terms, limits and particular conditions under which goods and services will be produced and then bought and sold in each other’s countries. The Japanese government, for instance, is determined to maintain a degree of trade protectionism for the benefit of Japan’s rice producers, who are fearful of open competition from their American rivals.

The U.S. government is under pressure from the American auto industry, for example, to continue limiting greater competition from the Japanese automobile industry. American labor unions want to restrict the importing of goods produced at lower labor costs abroad than U.S. manufactured goods, because American consumers might prefer to buy the lower priced foreign products and thus risking the loss of some of their union members’ jobs.

In short, the TPP is a trade agreement designed to promote the interests of politicians, cronies, and related politically connected vested interest groups on a regional scale. 

As a side note, the TPP could be seen as a part of the geopolitical strategy by the US government to 'rebalance' military and diplomatic relations toward Asia. Or this could be part of the Asian Pivot. The Asian Pivot, according to former US secretary of state, Mrs. Hillary Clinton consist of six courses of action: namely strengthening bilateral security alliances; deepening America's relationships with rising powers, including China; engaging with regional multilateral institutions; expanding trade and investment; forging a broad-based military presence; and advancing democracy and human rights. 

With the seeming growing rift between the US and China, TPP perhaps could now seen an instrument to compete or even limit China's sphere of influence.

Nonetheless, following a bounty recently setup by the anonymous organization WikiLeaks to publish secret information, news leaks, and classified media from anonymous sources, the same group unveiled some of the shroud from negotiations

From the Guardian

WikiLeaks on Wednesday released 17 different documents related to the Trade in Services Agreement (Tisa), a controversial pact currently being hashed out between the US and 23 other countries – most of them in Europe and South America.

The document dump comes at a tense moment in the negotiations over a series of trade deals. President Barack Obama has clashed with his own party over the deals as critics have worried about the impact on jobs and civil liberties.

On Tuesday, WikiLeaks put a $100,000 bounty on documents relating to the alphabet soup of trade treaties currently being negotiated between the US and the rest of the world, particularly the controversial Trans-Pacific trade agreement (TPP). The offer, announced yesterday, has already raised more than $33,000.

Wednesday’s leak is the third time that WikLeaks has published sections from secret trade agreements. In January it leaked a chapter from the TPP related to the environment. In November 2013 it made public a draft of the agreement’s intellectual property chapter, containing proposals that Wikileaks founder Julian Assange said would “trample over individual rights and free expression”. 

Among the text leaked on Wednesday are Tisa’s annex on telecommunications services, an amendment that would standardize regulation of telecoms across member countries, according to WikiLeaks. Other documents in the batch of files relate to e-commerce, transportation of living people and regulation of financial services corporations.

I guess the Wikileaks just unveiled part of the grand scheme to promote the globalization of cronyism.

Julian Assange on Bradley Manning’s Court Martial Verdict; Obama’s Promise to Protect Whistleblower Disappears

The statement of Wikileaks founder Julian Assange on Bradley Manning’s conviction. 

From Wikileaks.org:

Today Bradley Manning, a whistleblower, was convicted by a military court at Fort Meade of 19 offences for supplying the press with information, including five counts of ’espionage’. He now faces a maximum sentence of 136 years.

The ’aiding the enemy’ charge has fallen away. It was only included, it seems, to make calling journalism ’espionage’ seem reasonable. It is not.

Bradley Manning’s alleged disclosures have exposed war crimes, sparked revolutions, and induced democratic reform. He is the quintessential whistleblower.

This is the first ever espionage conviction against a whistleblower. It is a dangerous precedent and an example of national security extremism. It is a short sighted judgment that can not be tolerated and must be reversed. It can never be that conveying true information to the public is ’espionage’.

President Obama has initiated more espionage proceedings against whistleblowers and publishers than all previous presidents combined.

In 2008 presidential candidate Barack Obama ran on a platform that praised whistleblowing as an act of courage and patriotism. That platform has been comprehensively betrayed. His campaign document described whistleblowers as watchdogs when government abuses its authority. It was removed from the internet last week.

Throughout the proceedings there has been a conspicuous absence: the absence of any victim. The prosecution did not present evidence that - or even claim that - a single person came to harm as a result of Bradley Manning’s disclosures. The government never claimed Mr. Manning was working for a foreign power.

The only ’victim’ was the US government’s wounded pride, but the abuse of this fine young man was never the way to restore it. Rather, the abuse of Bradley Manning has left the world with a sense of disgust at how low the Obama administration has fallen. It is not a sign of strength, but of weakness.

The judge has allowed the prosecution to substantially alter the charges after both the defense and the prosecution had rested their cases, permitted the prosecution 141 witnesses and extensive secret testimony. The government kept Bradley Manning in a cage, stripped him naked and isolated him in order to crack him, an act formally condemned by the United Nations Special Rapporteur for torture. This was never a fair trial.

The Obama administration has been chipping away democratic freedoms in the United States. With today’s verdict, Obama has hacked off much more. The administration is intent on deterring and silencing whistleblowers, intent on weakening freedom of the press.

The US first amendment states that "Congress shall make no law... abridging the freedom of speech, or of the press". What part of ’no’ does Barack Obama fail to comprehend?

Oh by the way, US President Obama once promised to “protect whistleblowers” in one of his serial policy promises during the post 2008 elections

Unfortunately such provision, previously published at the the Change.gov website, “which was set up by the Obama transition team after the election in 2008 has suddenly been scrubbed of all of its original content” according to the techdirt.com. (hat tip Gary North)

When promises will not be fulfilled, just erase the records and hope that the public's truncated memory will lead to its oblivion.

The Information Age and the Philippine Cybercrime Law

Amidst fiery protest by many Philippine cyberspace users, the newly enacted Cybercrime Prevention Act of 2012 RA 10175 took effect today (BBC). 

So far, according to Freedom House in 2012 the Philippines ranks 6th in the world in internet freedom.

I am pretty sure that the law will diminish the current state of internet freedom, regardless of the excuses given by politicians, and regardless of the relative standings of internet freedom in the world overtime. Although I expect some of the current activities to shift to the informal cyberspace.

Just read all the clauses containing the term “misleading” as punishable by law to understand the law’s arbitrariness. This simply means legalistic vagueness could be used to harass political opposition or anyone on the whims of the politicos.

As of this writing the government website hosting RA 10175 is down. This could be because of heavy traffic or could be down due to protest activities undertaken by hacktivists (Examiner)

As a side note, I am also quite delighted to see the passionate responses even by statists against internet censorship. It’s a bizarre world though, when curtailment of freedom involves them, the statists balk, resist and join the commotion, but when curtailment is applied only to others they cheer.

Nevertheless, here are the top 10 Countries who censor the internet most.

From 24/7 Wall Street based on Freedom House's ranking of internet freedom

1. Iran

2. Cuba

3. China

4. Syria

5. Uzbekistan

6. Ethiopia

7. Myanmar

8. Vietnam

9. Bahrain

10. Saudi Arabia

The next list is from the Committee to Protect Journalists 

The growing crusade by governments against the internet or internet censorship should be expected and constitutes resistance to change as forces of decentralization (internet) and centralization (governments) have been on a head-on collision course.

This essentially represents part of the volatile and turbulent transition process towards the deepening of the information age.

The lists of the 10 countries who apply internet censorship most reveals that despite governments’ acts to suppress free expression, the freedom of internet expression still thrives, albeit underground.

To give some examples

-China’s shadow or informal social media users continue to swell despite the government’s prohibition.

-Cuba’s repressive government has repeatedly failed to stop domestic political activist blogger who became an international sensation Yoani Maria Sánchez Cordero.

-There is the ongoing harassment against Wikileaks through  founder Julian Assange and the war against eponymous group Anonymous (who ironically appears to have taken up the cudgels of domestic cyber activists) for exposing on government malfeasances.

-Also the Iranian government’s attempt to convert her cyberspace into a national intranet has dramatically backfired where Iran’s government has been forced to retreat.

From Gizmodo,

After seriously flipping out, cutting of Iranian access to Google and basically herding all its citizens into a tiny little government-approved intra-net pen, the Iranian government has softened its Internet ban just a little bit and restored access to Gmail.

Though the outcry against censoring the Internet at large was loud, the backlash against cutting users off from Google services such as Gmail was particularly strong. Many Iranians (reportedly around half) resorted to using VPNs to get outside of the the intra-net bubble, creating millions of dollars in profit for local VPN firms. Even government officials railed against the lack of Gmail, and complained that local clients just weren't up to snuff.

Given that the penetration rate of internet users in the Philippines is nearly at 30% of the population (internetworldstats.com), from which the bulk comes from the elite and the middle class, it would not be surprising if a sustained uproar would end up with a political ‘compromise’ ala Iran.

Bottom line: Global governments including the Philippines will continue to do everything to try to control and regulate the flow of information in order to preserve the status quo. However and unfortunately for them, the free market in the internet, people’s newfound fondness with connectivity and the knowledge revolution will give them quite a challenge.

Yet there is no stopping the march towards the information age.

Quote of the Day: Wikileaks’ Tweet on US Embassy Attack at Libya

By the US accepting the UK siege on the Ecuadorian embassy in London it gave tacit approval for attacks on embassies around the world.

Source: Business Insider

For a short background, in fear of extradition to the US (through Sweden) out of political harassment for exposing many of the secrets of the US government, Wikileaks founder Julian Assange sought refuge at the Ecuador Embassy in London which was recently besieged by UK officials.

Wikileaks thus attempts to associate the US embassy attack to the harassment being endured by its founder.

To Fix the Culture of Secrecy, Reduce Government’s Role in Society

Internet sites as Wikileaks and Anonymous has gone on exposing much of government “secrets” through "leaks", thereby putting immense pressure on governments to become more “transparent”.

For some politicians and experts in the US, the way to deal with a “culture of leaks” translates to the management classification of information.

This from the CNN,

At the end of July, the Senate intelligence committee marked up legislation drafted in response to recent high-profile leaks of classified information. The committee's chairwoman, Dianne Feinstein, claims that the bill will address the "culture of leaks" in Washington. But the leaks are a symptom of the intelligence community's culture of secrecy -- and the bill would make that problem worse in a host of ways.

Any insider will tell you that the government classifies far too much information. Top military and national security officials estimate that between 50% and 90% of classified documents could safely be released. That adds up to a massive amount of unnecessary secrecy when one considers there were 92 million decisions to classify information in 2011 alone.

The WikiLeaks disclosures featured some vivid examples, such as a cable from an American diplomat who classified his description of a typical wedding in the province of Dagestan.

Put simply, officials who routinely see innocuous documents stamped "Secret" lose respect for the system, and that puts all secrets, the real ones as well as the purely nominal ones, at risk.

Excessive classification also means that even low-level or nonsensitive government positions often require clearances. One in every 50 American adults now has access to classified information, not a winning formula for keeping secrets.

The Senate bill, however, does nothing serious to address the problem of overclassification. Indeed, it perpetuates the fiction that all classified information poses a dire threat.

The bill strips intelligence community employees of their pensions if the Director of National Intelligence decides they leaked classified information, even if the information reveals only that Dagestani weddings last three days. It revokes the clearances of officials who disclose the existence of classified covert operations -- even if the operations, like the raid on Osama bin Laden's compound, are in the past and could not possibly be jeopardized by disclosure.

Worse, the Senate bill extends the shroud of secrecy to encompass even unclassified information. Intelligence officials already must submit any publications that discuss their work to their agencies for pre-publication review and approval; under the bill, they must submit "anticipated oral remarks" as well. On its face, the provision could require pre-publication review for dinner party conversations.

This is an example of how politics addresses symptoms rather than the disease.

In reality, the political institution called the government operates on the principle of mandated organized violence.

And much of these acts of violence and repression have been deliberately concealed from the public for reasons which works to the interests or benefits of the political authorities.

It is only when violence has been seen as popular or politically expedient, when these are made public, or when they are uncovered or exposed by media.

In short, the political nature of governments has been one of advancing the culture of secrecy or of scapegoatism. Transparency, thus, is nothing but a political jingoistic charade.

SM Oliva, formerly of the Mises Institute, has this highly relevant quote

“Transparency” is a buzzword associated with all sorts of good-government movements. But it’s something of a libertarian Trojan horse. No government can ever be transparent, for that would rob of it of its very substance. All monopoly government is predicated on the ability to actively mislead and misdirect the majority — the public — away from the truth, whether it’s political truth, economic truth, or personal truth. Even government attempts at transparency are themselves usually little more than misdirection by another name. One can be transparent in such a way as to satisfy most inquisitors while revealing nothing that compromises the basic pillars of the state.

Bottom line: Managing information classifications will hardly solve on the issue of the “culture of secrecy” the latter of which signifies on the essence of government. To attain government “transparency” extrapolates to the vast reduction or retrenchment of government’s role in society.

And another thing; the pressure by Wikileaks and by other social media outfits on governments reveals of the process of the slomo ungluing of centralized political structure. Centralized institutions have been feeling the heat from, and or have been fervently fighting against, the forces of decentralization.

War on Internet: Anonymous will do a Wikileaks this December

The war on the internet continues.

Despite a string of legal harassment suit waged against activists like Wikileaks, internet activism will persist to haunt governments and their cronies.

Another activist group called the Anonymous announced that they will do a Wiki-leaks expose this December.

From Personal Liberty.com (hat tip Sovereign Man)

The global “hacktivist” syndicate Anonymous wants people all over the world to expose evidence of corruption and injustice by leaking documents to which they have access.

In a recently posted video, the group urges anyone who has access to evidence of corporate or government wrongdoing to purchase a USB drive and document the evidence for publication on the Internet.

“Imagine you purchase a USB drive. Imagine you take it to your work place. Imagine you collect evidence of illegality and corruption. Imagine together we expose all lies. Imagine we leak it all,” scrolls across the screen in a recent video posted by the group.

The initiative, dubbed Project Mayhem 2012, will take place over the 10-day period from Dec. 12 to Dec. 21, during which the video claims “the World will see an unprecedented amount of Corporate, Financial, Military and State leaks that will have been secretly gathered by millions of CONSCIENTIOUS citizens, vigilantes, whistle blowers and insiders worldwide.”

The group claims to be in the process of developing a Wikileaks-style platform called TYLER where the information can be anonymously posted.

Video here.

Wikileaks Exposé: Eurozone Needs a Bankruptcy Option

Wikileaks intercepted and posted on the web a cable sent by the Berlin by the US ambassador to Germany, Philip Murphy, to the Treasury Department and the State Department, on February 12, 2010 citing a Chapter 11 for Eurozone countries

From Bob Wenzel, (bold emphasis mine)

In part the cable reads:

“A EUROZONE CHAPTER 11: DB [Deustche Bank] Chief Economist Thomas Mayer told Ambassador Murphy he was pessimistic Greece would take the difficult steps needed to put its house in order. A worst case scenario, says Mayer, could be that Germany pulls out of the Eurozone altogether in 20 years time. In 1990, Germany's Constitutional Court ruled that the country could withdraw from the Euro if: 1) the currency union became an "inflationary zone," or 2) the German taxpayer became the Eurozone's "de facto bailout provider." Mayer proposes a "Chapter 11 for Eurozone countries," which would place troubled members under economic supervision until they put their house in order. Unfortunately, there is no serious discussion of this underway, he lamented.”

The cable outlines the concern German officials have with using German taxpayer money to bailout Greece and other financially weak Eurozone members. The cable in many ways explains Germany's recent foot dragging on getting a bailout deal done, since a completed deal will mean either funding by German taxpayers or European Central Bank money printing. Here's more from the cable:

“Chancellor Angela Merkel's government welcomed the decision taken at the EU's February 11 [2010] informal summit in Brussels not to provide financial assistance, for the moment, to cash-strapped Greece. German officials believe a bailout is not needed at this time, and that extending a lifeline to Greece would have carried too many risks. One major fear in Germany is that "saving" Greece would lead to other needy Eurozone members expecting the same treatment...Prior to the February 11 EU Summit in Brussels, there was much hair pulling in Berlin over the wisdom of participating in some sort of Greek rescue. No one savored the idea of explaining to German taxpayers, already concerned about Germany's record deficit, that they would be footing the bill for the irresponsible behavior of another country. A Finance Ministry official explained to us that many Germans felt disgusted by the situation in Greece: "While Germans have spent the past decade tightening their belts and improving their competitiveness, Greek civil servants still earn 14 months' salary per year." A recent editorial in the German daily Frankfurter Allgemeine Zeitung (FAZ) asked rhetorically whether Germans would need to work until age 69 just to finance early retirement for Greek workers. With important upcoming elections in the state of North Rhine-Westphalia, bailing out Greece would not be a vote winner...The German government was, in fact, "relieved" that the European Council meeting on February 11 decided not to put concrete assistance on the table at this time...”

But here's more from the cable, which explains why Germany even cares what happens to Greece

“Chancellor Merkel is clearly relieved she does not, for now, have to explain to the public why the German government is running up its own deficit to bail out debt-laden Greece. Still, the German government appears prepared to step in as a last resort if needed and is cognizant that German banks (such as Hypo Real Estate and Deutsche Bank) and insurance companies (Allianz) have significant exposure to Greek sovereign debt.”

In other words, it's all about the damn banksters.

Read the rest here

Incidentally, Deutsche Bank Chief Economist Thomas Mayer who proposed “Chapter 11 for Eurozone countries” or the Eurozone’s bankruptcy option recently wrote about the revival of Austrian economics (bold original from my earlier post)

Therefore we need to dump the flat-earth theories promising that economic and financial outcomes can be planned with a high degree of certainty and need to look at other theories that accept the limits of our knowledge about the future. A revival of Austrian economics could be a good start for such a research programme.

Could it be that the influence of Austrian economics has begun to permeate into policymaking?

War on the Internet: Legalized Spying of Email?

Incumbent political institutions will continue to wage war of controls against the immensely expanding social media. The latter is being proven as a crystallizing force in politics (e.g. Arab Spring)

I have covered part of this cat and mouse engagement here, here, here and here. Now the theatre of war has expanded to include prying into personal emails.

This from Wall Street Journal (bold emphasis mine)

The U.S. government has obtained a controversial type of secret court order to force Google Inc. and small Internet provider Sonic.net Inc. to turn over information from the email accounts of WikiLeaks volunteer Jacob Appelbaum, according to documents reviewed by The Wall Street Journal.

Sonic said it fought the government's order and lost, and was forced to turn over information. Challenging the order was "rather expensive, but we felt it was the right thing to do," said Sonic's chief executive, Dane Jasper. The government's request included the email addresses of people Mr. Appelbaum corresponded with the past two years, but not the full emails.

Both Google and Sonic pressed for the right to inform Mr. Appelbaum of the secret court orders, according to people familiar with the investigation. Google declined to comment. Mr. Appelbaum, 28 years old, hasn't been charged with wrongdoing.

The court clashes in the WikiLeaks case provide a rare public window into the growing debate over a federal law that lets the government secretly obtain information from people's email and cellphones without a search warrant. Several court decisions have questioned whether the law, the Electronic Communications Privacy Act, violates the U.S. Constitution's Fourth Amendment protections against unreasonable searches and seizures.

WikiLeaks is a publisher of documents that people can submit anonymously. After WikiLeaks released a trove of classified government diplomatic cables last year, U.S. Attorney General Eric Holder said the U.S. was pursuing an "active criminal investigation" of WikiLeaks.

Passed in 1986, the Electronic Communications Privacy Act is older than the World Wide Web, which was dreamed up in 1989. A coalition of technology companies—including Google, Microsoft Corp. and AT&T Corp.—is lobbying Congress to update the law to require search warrants in more digital investigations.

The law was designed to give the same protections to electronic communications that were already in place for phone calls and regular mail. But it didn't envision a time when cellphones transmitted locations and people stored important documents on remote services, such as Gmail, rather than on their own computers.

Law enforcement uses the law to obtain some emails, cellphone-location records and other digital documents without getting a search warrant or showing probable cause that a crime has been committed. Instead the law sets a lower bar: The government must show only "reasonable grounds" that the records would be "relevant and material" to an investigation.

As a result, it can be easier for law-enforcement officers to see a person's email information than it is to see their postal mail.

Another significant difference: A person whose email is inspected this way often never knows a search was conducted. That's because court orders under the 1986 law are almost always sealed, and the Internet provider is generally prohibited from notifying the customer whose data is searched. By contrast, search warrants are generally delivered to people whose property is being searched.

Read the rest here

Politics has never been about transparency or tolerance of political differences or of freedom of speech or of respect of privacy but has been about censorship and the suppression of political opponents or the despotic control of the flow of information. This applies not just in the US but everywhere.

Current day politics essentially represents an ongoing battle between vertical political forces, vestiges of the industrial age, against the new generation individual based or bottom-up forces whom have been enabled and empowered by the web, such as Wikileaks.

Even the current welfare-financial crisis being endured by mostly Western or developed nations have been clear symptoms of the erosion of this untenable structure.

It’s the same war that’s being wage at almost every aspects of our lives.

A war against our civil liberties. And, through the internet and through education, we are fighting back.

As Ludwig von Mises wrote,

Everything that happens in the social world in our time is the result of ideas. Good things and bad things. What is needed is to fight bad ideas. We must fight all that we dislike in public life. We must substitute better ideas for wrong ideas. We must refute the doctrines that promote union violence. We must oppose the confiscation of property, the control of prices, inflation, and all those evils from which we suffer.

Ideas and only ideas can light the darkness. These ideas must be brought to the public in such a way that they persuade people. We must convince them that these ideas are the right ideas and not the wrong ones. The great age of the nineteenth century, the great achievements of capitalism, were the result of the ideas of the classical economists, of Adam Smith and David Ricardo, of Bastiat and others.

Hot: Wikileaks Exposes Gold Price Suppression

Writes Chris Powell, Secretary/Treasurer of Gold Anti-Trust Action Committee Inc. (GATA), published at the goldseek.com (bold emphasis mine)

China knows that the U.S. government and its allies in Western Europe strive to suppress the price of gold, and the U.S. government knows that China knows, according to a 2009 cable from the U.S. Embassy in Beijing to the State Department in Washington.

The cable, published in the latest batch of U.S. State Department cables obtained by Wikileaks, summarizes several commentaries in Chinese news media on April 28, 2009. One of those commentaries is attributed to the Chinese newspaper Shijie Xinwenbao (World News Journal), published by the Chinese government's foreign radio service, China Radio International. The cable's summary reads:

"According to China's National Foreign Exchanges Administration, China's gold reserves have recently increased. Currently, the majority of its gold reserves have been located in the United States and European countries. The U.S. and Europe have always suppressed the rising price of gold. They intend to weaken gold's function as an international reserve currency. They don't want to see other countries turning to gold reserves instead of the U.S. dollar or euro. Therefore, suppressing the price of gold is very beneficial for the U.S. in maintaining the U.S. dollar's role as the international reserve currency. China's increased gold reserves will thus act as a model and lead other countries toward reserving more gold. Large gold reserves are also beneficial in promoting the internationalization of the renminbi."

It's hard to believe that, two years later, China is still leaving so much of its gold with the Federal Reserve Bank of New York and the Bank of England when even little Venezuela has publicly figured out the gold price suppression component of the Western fractional reserve banking system and is attempting to repatriate its gold from the Bank of England and various Western bullion banks:

http://www.gata.org/node/10281

http://www.gata.org/node/10286

It is already a matter of record that China dissembled about its gold reserves for the six years prior to the public recalculation of its gold reserves in April 2009 that prompted the commentary in Shijie Xinwenbao. At that time China announced that its gold reserves were not the 600 tonnes it had been reporting each year for the previous six years but rather 76 percent more, 1,054 tonnes:

http://www.gata.org/node/9545

ZeroHedge, which seems to have broken the story of the Beijing embassy cable this evening, comments:

"Wondering why gold at $1,850 is cheap, or why gold at double that price will also be cheap, or, frankly, at any price? Because, as the following leaked cable explains, gold is, to China at least, nothing but the opportunity cost of destroying the dollar's reserve status. Putting that into dollar terms is, therefore, impractical at best and illogical at worst. We have a suspicion that the following cable from the U.S. embassy in China is about to go not viral but very much global, and prompt all those mutual fund managers who are on the golden sidelines to dip a toe in the 24-karat pool."

The ZeroHedge commentary can be found here:

http://www.zerohedge.com/news/wikileaks-discloses-reasons-behind-chinas-...

In addition to fund managers throughout the world, this cable may be of special interest to the gold bears CPM Group Managing Director Jeff Christian, who says he consults with most central banks and that they hardly ever think about gold, and Kitco senior analyst Jon Nadler, who insists that central banks have no interest whatsover in manipulating the gold price.

In fact, of course, gold remains the secret knowledge of the financial universe, and its price is actually the determinant of every other price and value in the world.

The Beijing embassy cable can be found here:

http://cables.mrkva.eu/cable.php?id=204405

And, just in case, at GATA's Internet site here:

http://www.gata.org/files/USEmbassyBeijingCable-04-28-2011.txt

This only exhibits how the welfare-warfare state-central banking-banking cartel have been deeply averse to reinstate a sound money regime which extrapolates to a dilution of their political power, and thus the continuing saga of the war on gold (sound money) and on free markets.

Leaked Secret Memos Reveal That The Iraq War Has Been Mostly About Oil

The Iraq War has NOT been about oil?

Well, highly confidential memos leaked to the public appear to expose on such duplicity.

From The Independent (hat tip Bob Wenzel) [bold emphasis mine]

Plans to exploit Iraq's oil reserves were discussed by government ministers and the world's largest oil companies the year before Britain took a leading role in invading Iraq, government documents show.

The papers, revealed here for the first time, raise new questions over Britain's involvement in the war, which had divided Tony Blair's cabinet and was voted through only after his claims that Saddam Hussein had weapons of mass destruction.

The minutes of a series of meetings between ministers and senior oil executives are at odds with the public denials of self-interest from oil companies and Western governments at the time.

The documents were not offered as evidence in the ongoing Chilcot Inquiry into the UK's involvement in the Iraq war. In March 2003, just before Britain went to war, Shell denounced reports that it had held talks with Downing Street about Iraqi oil as "highly inaccurate". BP denied that it had any "strategic interest" in Iraq, while Tony Blair described "the oil conspiracy theory" as "the most absurd".

But documents from October and November the previous year paint a very different picture.

Five months before the March 2003 invasion, Baroness Symons, then the Trade Minister, told BP that the Government believed British energy firms should be given a share of Iraq's enormous oil and gas reserves as a reward for Tony Blair's military commitment to US plans for regime change.

Read the rest here

Comments:

What government says in public and what government does are almost always different.

Here is an example of the public choice theory at work where well-entrenched and powerful vested interest groups shape government policies.

Also, corporatism or crony capitalist agendas extrapolate into imperial (foreign) policies advertised in the name of national security, but covertly operates for the benefit of the politically favored groups. In short, “national interests” equals corporate interests.

Lastly, the beauty of the internet is to act as a neutralizing agent against clandestine operations by governments. Either the internet will reduce the incidences of government’s secret operations or governments will wage a war of control against the free flowing information provided by the internet via censorship. We see more signs of the latter than the former.

Peak Oil Represents Government Failure

The beauty of the internet is that it has been leveling the playing field between the public and the governments in terms of information.

The web has placed much of government’s stealth activities in jeopardy.

A good example is the controversial Wikileaks which has recently revealed that Saudi Arabia could have been exaggerating the declaration of her oil reserves. Translation: Expect higher oil prices soon.

The Business Intelligence reports,

Saudi Arabia, the world's largest crude oil exporter, is unable to pump enough oil to keep prices from rising, the Guardian reported, citing confidential cables from the US embassy in Riyadh.

The cables from 2007 to 2009 made public by the website Wikileaks, urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300 billion barrels, nearly 40%.

The report cites comments attributed to Saudi Aramco geologist and former exploration chief, Sadad al-Husseini, that Aramco couldn't reach the 12.5-million-barrel daily capacity needed to keep prices from rising.

According to the cables, which date between 2007-09, Husseini said "Saudi Arabia might reach an output of 12 million barrels a day in 10 years but before then – possibly as early as 2012 – global oil production would have hit its highest point." This crunch point is known as "peak oil".

Peak oil adherents may be quick to say “I told you so”.

However as we previously said,

While peak oil (via Hubbert Peak Theory) may be a valid engineering theory, it is a poor economic concept for the simple reason that engineering theories (like quant models) do not capture people’s behaviour.

The Wikileaks exposé only serve as a concrete example of how governments have steadfastly tried to manipulate every politically sensitive markets...and this includes the oil markets.

To consider, given the stranglehold control over oil supplies by different oil producing states, which accounts for more than 80% of the world’s proven reserves, if governments had the ascendancy to establish “equilibrium” then we won’t be bothered by prospective risks of shortages (via “Hubbert Peaks”) or suffer from elevated oil prices at all.

Graphs from the US EIA (includes BP Statistical Review and PRC Energy)

But obviously this hasn’t been the case.

Since governments are comprised by people—only that these elites have been politically mandated (which means they hold the barrel of the gun on us)—they suffer from the same frailties as anyone else.

Yet governments have been demonstrated:

-to lack access to the technology required to efficiently and productively utilize their oilfields,

-have had inadequate financing to invest to satisfy consumer demand,

-has revealed administrative incompetence in operating national firms or in the supervision of the 'choked’ industry, and

-most importantly, had been exposed for the paucity of knowledge to implement “equilibrium”.

It is worth emphasizing that with over 80% of proven oil reserves (supplies) controlled by global governments, this means there has hardly been a functioning free market in oil!

If Saudi officials are indeed guilty of withholding information then this reinforces the problems of the massive distortions in the oil markets which would likely implode on our faces-a negative externality as a result of government failure.

Otherwise, dynamic price signals in a free market would have reflected on the balance of demand and supply from which the marketplace would have adjusted accordingly.

What you have, instead, are vastly distorted oil markets that has been amassing intensive structural “supply-side” imbalances compounded by the manipulation of money supply by global central banks that has been contorting the “demand side”. A perfect storm in the making.

So what elevated oil prices suggest is not a validation of peak oil theory but one of the massive failure of government intervention or controls.