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US to impose more sanctions on Russia for ‘supporting Assad’

US ambassadors Nikki Haley and John Huntsman confirm further sanctions on Russian companies to be announced Monday

Alexander Mercouris

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Two US ambassadors – Nikki Haley, the US’s ambassador to the UN, and John Huntsman, the US’s ambassador to Russia – have confirmed that the US Treasury Department will be unveiling further sanctions on Russia tomorrow in retaliation for Russia’s continued support for President Assad.

Nikki Haley’s comments were made on CBS News’s “Face the Nation” programme.  The Washington Post quotes them as follows

You will see that Russian sanctions will be coming down.  [Treasury Secretary Steven Mnuchin] will be announcing those Monday, if he hasn’t already.  And they will go directly to any sort of companies that were dealing with equipment related to Assad and chemical weapons use. I think everyone is going to feel it at this point. I think everyone knows that we sent a strong message, and our hope is that they listen to it.

John Huntsman’s comments were contained in a letter to the Russian government, details of which were disclosed by a Russian government source to the Russian newspaper Kommersant.  Here is how Interfax reports them

Washington has warned Moscow of preparing new sanctions over Russia’s support for the regime of Bashar al-Assad, the Kommersant newspaper wrote, citing unnamed sources.

“One of these days U.S. Ambassador Jon Huntsman sent the Russian Foreign Ministry a letter saying that the U.S. authorities were preparing new sanctions against Russia. This time, simply ‘for the support’ for Syrian president Bashar al-Assad,” the article said.

The letter consisted of two parts, the paper said.

“In the second part of his message Jon Huntsman notifies Moscow that Washington intends to introduce new sanctions against time. This time, for supporting the Syrian regime,” the article said.

The first part of the letter “sets out the motivation behind the military operation against Syria launched by Americans and their allies,” the paper said.

“In the U.S. view, the Syrian authorities were responsible for the use of chemical weapons against their own people, and the international community must take steps to stop Bashar al-Assad,” Kommersant said.

Nikki Haley’s comments suggest that the US Treasury Department is once again looking at sanctions of Russian individuals and companies – especially companies involved in the defence sector – rather than further sectoral sanctions, which the US Treasury Department has previously ruled out.

That the US would follow up the missile strike by applying more economic pressure on Russia in order to try to force Russia to change its policy in Syria was in fact clearly hinted at by US President Trump in his speech on Friday announcing the missile strike on Syria

The combined American, British and French response to these atrocities will integrate all instruments of our national power: military, economic and diplomatic. We are prepared to sustain this response until the Syrian regime stops its use of prohibited chemical agents.

I also have a message tonight for the two governments most responsible for supporting, equipping and financing the criminal Assad regime.

To Iran and to Russia, I ask: What kind of a nation wants to be associated with the mass murder of innocent men, women and children? The nations of the world can be judged by the friends they keep.

No nation can succeed in the long run by promoting rogue states, brutal tyrants and murderous dictators. In 2013, President Putin and his government promised the world that they would guarantee the elimination of Syria’s chemical weapons. Assad’s recent attack and today’s response are the direct result of Russia’s failure to keep that promise.

Russia must decide if it will continue down this dark path or if it will join with civilized nations as a force for stability and peace. Hopefully, someday we’ll get along with Russia and maybe even Iran, but maybe not.

I will say this, the United States has a lot to offer with the greatest and most powerful economy in the history of the world.

(bold italics added)

The threat and the bribe are clear enough: the US will go on imposing sanctions on Russia if Russia continues to support President Assad’s government; but will provide Russia with massive economic assistance if it changes course (abandons its “dark path”).

These statements come on the eve of a UN Security Council session on Monday at which the US, Britain and France will propose a draft Resolution affirming that a chemical weapons attack took place in Douma on 7th April 2018 – something Russia and Syria categorically deny, and which the OPCW has not confirmed – and requiring President Assad to make “full disclosure” of his chemical weapons stocks – which both Russia and Syria say Syria no longer has.

Presumably the intention is to try to bully Russia to vote or abstain on this Resolution, and to impose sanctions if it vetoes it.

There is in fact no possibility that the sanctions – or the threat of sanctions, if they are postponed till after the vote on the Resolution – are going to make Russia change its position.  Russia’s deputy Foreign Minister Sergey Ryabkov has already reaffirmed that Russia has its “red lines” and intends to stick by them.

It is going to be very difficult for the Security Council member states to find a compromise on the Syrian resolution, Ryabkov warned. I don’t want to make assumptions on how the work will go on, but one has to understand that we have obvious ‘red lines.’ Probably, there are some kind of important ‘red lines’ for the Western group as well.”

“We’re going to evaluate the proposal of the Western troika with a critical eye. We don’t decide anything for ourselves in advance – if there are reasonable elements there, we’re going to work on them,” he said…..
The process of destruction [of Syrian chemical weapons in 2013-14] was carried out in close cooperation of the involved countries, including the US, and under strict international supervision,” Ryabkov said. “Therefore, I don’t understand the endless, primitive and unsubstantiated bogus stories, which are made up – sometimes by high-ranking US officials, that Russia didn’t fulfil its obligations.”

I will also here restate my repeatedly stated view that the Western Powers hugely misjudge the impact of sanctions on Russia.  As a self-sufficient continental economy with minimal debt levels, a balanced budget, big reserves, a surplus on the current account, and more than sufficient technology and capital to drive its own development, Russia not only can survive sanctions; it can actually thrive on them.

In my opinion some Western commentators have become altogether too excited because the immediate response to the sanctions the US imposed a week ago was a dip in the Russian stock market and a fall in the rouble, which however has since stabilised.

That there would be a panicked reaction on the part of certain Western investors to the latest round of sanctions was entirely unsurprising, especially as the Russian company most affected by the sanctions – Oleg Deripaska’s Rusal – is one of Russia’s companies which has most heavily integrated itself into the Western financial system.

Deripaska – most unwisely as things have turned out – starting from the mid-2000s was one of the most aggressive Russian business leaders in offshoring his businesses. 

Thus Rusal, though its corporate headquarters and the bulk of its production are in Russia, is actually incorporated in the British offshore tax haven of Jersey, and its shares are traded not just on the Moscow stock exchange but also internationally. 

This international profile, and Rusal’s repeated heavy borrowings in Western financial markets, has left Rusal intensely vulnerable to US sanctions.

Given Rusal’s size it was inevitable that any sanctions imposed on it would have a temporary impact.  However whatever happens to Rusal – and despite official denials nationalisation is a distinct possibility – for the reasons I have said, the Russian economy will adjust to it, just as it has successfully adjusted – as I also repeatedly predicted – to every round of sanctions that the West has imposed on it since 2014.

This also is true of any further sanctions the US and the Western powers are going to impose on Monday or later in connection with the Syrian crisis.

The same point was made about the latest sanctions by none other than Russia’s former Finance Minister Alexey Kudrin, who is someone who as a general rule never misses an opportunity to talk down the prospects of the Russian economy when he can

This (the current situation in the financial markets – TASS) will not affect strongly the economic growth. On the other hand, it will require the Central Bank to pay extra attention to inflation, so I think we should not wait for the Central Bank to cut the key rate in the nearest half-year.

Despite the exit of some foreign investors from the Russian stock market, nevertheless, we now have a high price for oil. In this respect I do not expect any serious new fluctuations. In addition, the weakened rouble helps Russian exports, and a number of industries are likely to earn. In general the balance will be quite good, it will not affect strongly the economic growth.

(bold italics added)

For what it’s worth my opinion is that the weakening of the rouble is an unalloyed blessing.  One of the malign consequences of the Central Bank’s policy of keeping real interests at 5% is that it has caused the rouble to strengthen more than it is in the Russian economy’s interests that it should.

A dip in the rouble will not only strengthen exports and deter imports, but at a time of rising oil prices it will also improve the Russian government’s budgetary position.

As for the effect of any rouble weakening on inflation, I expect it to be small and temporary – just as it was in 2016 – and with inflation currently at an annual rate of 2.4% as against the Central Bank’s target of 4% a brief rise in inflation is nothing to worry about.

For what it’s worth my opinion is that one of the reasons why economic growth last year was less than was expected was precisely because the rouble that year was encouraged to strengthen excessively, which had a negative effect on industrial growth.

As for the political effect of sanctions, President Putin’s landslide victory in the recent Russian Presidential elections shows that they have the opposite effect to the one the US and the Western Powers suppose they do.  Far from weakening President Putin’s political standing inside Russia, they are strengthening it.

The repeated failure of the West’s sanctions policy towards Russia seems however to have little or no effect on its advocates.  All the indications are that rather than reverse course its advocates in the West are doubling down on it.  In doing so they are doubling down on a policy which has repeatedly failed, and I expect it to go on doing so whether in relation to Russian policy towards Syria or anything else.

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French opposition rejects Macron’s concessions to Yellow Vests, some demand ‘citizen revolution’

Mélenchon: “I believe that Act 5 of the citizen revolution in our country will be a moment of great mobilization.”

RT

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Via RT…


Macron’s concessions to the Yellow Vests has failed to appease protesters and opposition politicians, such as Jean-Luc Mélenchon, who called for “citizen’s revolution” to continue until a fair distribution of wealth is achieved.

Immediately after French President Macron declared a “social and economic state of emergency” in response to large-scale protests by members of the Yellow Vest movement, promising a range of concessions to address their grievances, left-wing opposition politician Mélenchon called on the grassroots campaign to continue their revolution next Saturday.

I believe that Act 5 of the citizen revolution in our country will be a moment of great mobilization.

Macron’s promise of a €100 minimum wage increase, tax-free overtime pay and end-of-year bonuses, Mélenchon argued, will not affect any “considerable part” of the French population. Yet the leader of La France Insoumise stressed that the “decision” to rise up rests with “those who are in action.”

“We expect a real redistribution of wealth,” Benoît Hamon, a former presidential candidate and the founder of the Mouvement Génération, told BFM TV, accusing Macron’s package of measures that benefit the rich.

The Socialist Party’s first secretary, Olivier Faure, also slammed Macron’s financial concessions to struggling workers, noting that his general “course has not changed.”

Although welcoming certain tax measures, Marine Le Pen, president of the National Rally (previously National Front), accused the president’s “model” of governance based on “wild globalization, financialization of the economy, unfair competition,” of failing to address the social and cultural consequences of the Yellow Vest movement.

Macron’s speech was a “great comedy,”according to Debout la France chairman, Nicolas Dupont-Aignan, who accused the French President of “hypocrisy.”

Yet many found Melanchon’s calls to rise up against the government unreasonable, accusing the 67-year-old opposition politician of being an “opportunist” and “populist,” who is trying to hijack the social protest movement for his own gain.

Furthermore, some 54 percent of French believe the Yellow Vests achieved their goals and want rallies to stop, OpinionWay survey showed. While half of the survey respondents considered Macron’s anti-crisis measures unconvincing, another 49 percent found the president to be successful in addressing the demands of the protesters. Some 68 percent of those polled following Macron’s speech on Monday especially welcomed the increase in the minimum wage, while 78 percent favored tax cuts.

The Yellow Vest protests against pension cuts and fuel tax hikes last month were organized and kept strong via social media, without help from France’s powerful labor unions or official political parties. Some noted that such a mass mobilization of all levels of society managed to achieve unprecedented concessions from the government, which the unions failed to negotiate over the last three decades.

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Soros Mimics Hitler’s Bankers: Will Burden Europeans With Debt To ‘Save’ Them

George Soros is dissatisfied with the current EU refugee policy because it is still based on quotas.

The Duran

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Via GEFIRA:


After the Second World War, many economists racked their brains to answer the question of how Hitler managed to finance his armament, boost the economy and reduce unemployment.

Today his trick is well known. The economic miracle of Führer’s time became possible thanks to the so-called Mefo promissory notes.

The notes were the idea of the then President of the Reichsbank, Hjalmar Schacht, and served not only to finance the armament of the Wehrmacht for the Second World War, but also to create state jobs, which would otherwise not have been possible through the normal use of the money and capital markets, i.e. the annual increase in savings in Germany.

The Reich thus financed the armaments industry by accepting notes issued by the dummy company Metallurgische Forschungsgesellschaft GmbH (hence the name Mefo) rather than paying them in cash. The creation of money was in full swing from 1934 to 1938 – the total amount of notes issued at that time was 12 billion marks. The Reichsbank declared to the German banks that it was prepared to rediscount the Mefo notes, thus enabling the banks to discount them.

Because of their five-year term, the redemption of notes had to begin in 1939 at the latest. This threatened with enormous inflation. Since Schacht saw this as a threat to the Reichsmark, he expressed his doubts about the Reich Minister of Finance. But it did not help, and Schacht was quickly replaced by Economics Minister Walther Funk, who declared that the Reich would not redeem the Mefo notes, but would give Reich bonds to the Reichsbank in exchange. At the time of Funk, the autonomous Reichsbank statute was abolished, the Reichsbank was nationalized, and inflation exploded in such a way that Mefo notes with a circulation of 60 billion Reichsmark burdened the budget in post-war Germany.

George Soros also proposes such a money flurry in the style of Schacht and Funk.

Soros is dissatisfied with the current EU refugee policy because it is still based on quotas. He calls on the EU heads of state and governments to effectively deal with the migrant crisis through money flooding, which he calls “surge funding”.

“This would help to keep the influx of refugees at a level that Europe can absorb.”

Can absorb? Soros would be satisfied with the reception of 300,000 to 500,000 migrants per year. However, he is aware that the costs of his ethnic exchange plan are not financially feasible. In addition to the already enormous costs caused by migrants already in Europe, such a large number of new arrivals would add billions each year.

Soros calculates it at 30 billion euros a year, but argues that it would be worth it because “there is a real threat that the refugee crisis could cause the collapse of Europe’s Schengen system of open internal borders among twenty-six European states,” which would cost the EU between 47 and 100 billion euros in GDP losses.

Soros thus sees the financing of migrants and also of non-European countries that primarily receive migrants (which he also advocates) as a win-win relationship. He calls for the introduction of a new tax for the refugee crisis in the member states, including a financial transaction tax, an increase in VAT and the establishment of refugee funds. Soros knows, however, that such measures would not be accepted in the EU countries, so he proposes a different solution, which does not require a vote in the sovereign countries.

The new EU debt should be made by the EU taking advantage of its largely unused AAA credit status and issuing long-term bonds, which would boost the European economy. The funds could come from the European Stability Mechanism and the EU balance of payments support institution.

 “Both also have very similar institutional structures, and they are both backed entirely by the EU budget—and therefore do not require national guarantees or national parliamentary approval.“

In this way, the ESM and the BoPA (Balance of Payments Assistance Facility) would become the new Mefo’s that could issue bills of exchange, perhaps even cheques for Turks, Soros NGOs. Soros calculates that both institutions have a credit capacity of 60 billion, which should only increase as Portugal, Ireland and Greece repay each year the loans they received during the euro crisis. According to Soros, the old debts should be used to finance the new ones in such a way that it officially does not burden the budget in any of the EU Member States. The financial institutions that are to carry out this debt fraud must extend (indeed – cancel) their status, as the leader of the refugees expressed such a wish in his speech.

That Soros is striving to replace the indigenous European population with new arrivals from Africa and Asia is clear to anyone who observes its activities in Europe. The question is: what does he want to do this for and who is the real ruler, behind him, the real leader?

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The French People Feel Screwed

For the first time in his presidency, Macron is in trouble and Europe and America are looking on.

The Duran

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Authored by David Brown via The Gatestone Institute:


On December 4, French Prime Minister Édouard Phillipe told deputies of the ruling party, “La République en Marche”, that a proposed fuel tax rise, which had led to the largest protests France has seen in decades, would be suspended.

The protesters, called Gilets-Jaunes — “Yellow Vests,” because of the vests drivers are obliged by the government to carry in their vehicles in the event of a roadside breakdown — say that the fuel tax was the last straw from a president who took office with a promise to help the economically left-behind but instead has favoured the rich.

Even by French standards, the protests of the “Yellow Vests” during the weekend of December 1 were startling. Burning cars and vast plumes of grey smoke seemed to engulf the Arc De Triomphe as if Paris were at war. Comparisons were drawn with the Bread Wars of the 17th Century and the spirit of the Revolution of the 18th Century.

For more than two weeks, the “Yellow Vests” disrupted France. They paralyzed highways and forced roads to close — causing shortages across the country – and blocked fuel stations from Lille in the North to Marseilles in the South.

During protests in France’s capital, Paris, the “Yellow Vests” were soon joined by a more violent element, who began torching cars, smashing windows and looting stores. 133 were injured, 412 were arrested and more than 10,000 tear gas and stun grenades were fired.

One elderly lady was killed when she was struck by a stray grenade as she tried to shutter her windows against the melee.

There was talk of imposing a State of Emergency.

The “Yellow Vests” present the most significant opposition French President Emmanuel Macron has faced since coming to office in May 2017. Unlike previous protests in France, which have divided public opinion, these have widespread support – 72% according to a Harris Interactive Poll published December 1st.

Fuel tax rises — announced in November before being retracted on December — were intended to help bring down France’s carbon emissions by curbing the use of cars. Macron makes no secret of his wish to be seen as a global leader for environmental reform.

He forgets that back at home, among the people who elected him, fuel prices really matter to those outside big cities, where four-fifths of commuters drive to work and a third of them cover more than 30km each week.

The increases have incensed people in smaller communities, where they have already seen speed limits reduced to please the Greens and cuts to the local transport services.

These additional costs-of-living increases come at an extremely bad time for ordinary French people working outside of Paris. Lower-middle class families are not poor enough to receive welfare benefits but have seen their income flat-line whilst cost-of-living and taxes have risen.

An analysis by the Institut des Politiques Publiques think-tank shows that benefits cuts and tax changes in 2018 and 2019 will leave pensioners and the bottom fifth of households worse off, while the abolition of the wealth tax means that by far the biggest gains will go to the top 1%

This is tough to swallow. Macron is seen as being out of touch with ordinary people and is unlikely to escape his new title, “the President of the Rich.”

“People have this feeling that the Paris technocrats are doing complicated things to screw them,” said Charles Wyplosz, an economics professor at the Graduate Institute of International and Development Studies in Geneva.

It is probably not as complex as that. The French people feel screwed.

As employment and growth are slowing, Macron, for the first time in his presidency, is under serious pressure. Unemployment is at 9%; his efforts to reform Europe are stalling, and his approval rating has plummeted to just 23% according to a recent opinion poll by IFOP.

Images of Macron at the Arc De Triomphe daubed in graffiti calling for him to step down, or worse, have done little to bolster his image abroad.

So far, Macron had said he would not bow to street protests. To underline his point, in September 2017, he called protestors against French labour-market reform “slackers”.

The political U-Turn on the fuel tax is a turning point for the Macron presidency. The question is : What next, both for Macron and the “Yellow Vests”?

Macron most likely needs to plough ahead with his reform agenda, and doubtless knows he has the support of a solid majority in the National Assembly to do so. France is crippled by debt (nearly 100% of GDP) and its grossly bloated public sector. There are 5.2 million civil servants in France, and their number has increased by 36% since 1983. These represent 22% of the workforce compared to an OCDE average of 15%.

Tax-expert Jean-Philippe Delsol says France has 1.5 million too many “fonctionnaires [officials]. When you consider that public spending in France now accounts for 57 per cent of gross domestic product. Soon the system will no longer function as there will be less and less people working to support more and more people working less”.

Macron’s mistake, in addition to a seeming inclination for arrogance, is not to have made national economic reform his absolute priority right from his initial grace period after his election. Lower public expenses would have made it possible to lower taxes, hence creating what economists call a virtuous circle. Instead, he waited.

Now, at a time when he is deeply unpopular and social unrest is in full sway he is looking to make further reforms in unemployment benefits, scaling them back by reducing the payments and the length of time beneficiaries can receive the money. The “President of the Rich” strikes again.

There is talk that he may also re-introduce the wealth tax to try to placate the protestors.

Macron’s presidential term lasts until May 13, 2022. Understandably, Macron will be focused on the elections to the European Parliament expected to be held May 23-26, 2019. Headlines have signalled that Marine Le Pen and the National Rally (formally National Front) are ahead in the polls at 20%, compared to Macron’s En Marche at 19%.

The shift is understandable, given the divide between the countryside, where Le Pen has solid support, and the cities, where Macron’s centre-left prevail.

In contrast, the “Yellow Vests” have galvanised support after standing up for the “impotent ordinary”, and seem much buoyed by the solidarity they have been shown by both fire fighters and the police. There are images online of police removing their helmets and firefighters turning their backs on political authority to show their support for the protestors.

Whilst Macron’s political opposition may be fragmented, this new breed of coherent public opposition is something new. Leaderless, unstructured and organised online, the “Yellow Vests” have gained support from the left and right, yet resisted subjugation by either.

Being leaderless makes them difficult to negotiate withor to reason with in private. The “Yellow Vests” seem acutely aware of this strength, given their firm rebuttal of overtures for peace talks from the Macron government.

Enjoying huge support from the public and with reforms to the social welfare system on the horizon, the “Yellow Vests” are not going away.

For the first time in his Presidency, Macron is in trouble and Europe and America are looking on.

After Macron rebuked nationalism during his speech at the armistice ceremony, Trump was quick to remind the French President of his low approval rating and unemployment rate near 10%. A stinging broadside from Trump on twitter suggests that Macron may well be relegated to Trump’s list of global “Losers“:

“Emmanuel Macron suggests building its own army to protect Europe against the U.S., China and Russia. But it was Germany in World Wars One & Two – How did that work out for France? They were starting to learn German in Paris before the U.S. came along. Pay for NATO or not!”

The “impotent ordinary” in the United Kingdom, who might feel betrayed over Brexit, and the nationalists in Germany, who have suffered under Merkel , are no doubt staring in wonder at the “Yellow Vests”, wishing for the same moxie.

The historian Thomas Carlyle, chronicler of the French Revolution, said the French were unrivaled practitioners in the “art of insurrection”, and characterised the French mob as the “liveliest phenomena of our world”.

Mobs in other countries, by comparison, he argued were “dull masses” lacking audacity and inventiveness. The blazing yellow vests of the French protest movement , however, have made Macron appear increasingly dull and weak too.

David Brown is based in the United Kingdom.

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