Lost in Space

Where is this guy going with this?

Though an extraordinarily perceptive commentator and brilliant academic, Liberal leader Michael Ignatieff appears completely tone deaf.

In a week in which Conservative poll numbers have rightly gone off a cliff as allegations of willful blindness on the abetting of torture take hold, Ignatieff has been pretty much silent. And now news from the Globe's Jane Taber that he is "unplugging" himself and embarking on a tour to listen to Canadians. Key quote . . .

“This is all about listening to Canadians,” he told his caucus. And he advised them to be patient and work hard - noting that every question in Question Period and that every bit of work done in a committee is part of the re-building process for the Liberals. He said he was “certain” that rewards would come.

This minority government deserves to fall. The Minister of Defence is on life support. If a plug needs to be pulled, it should be his. This is not a time for contemplation; it is a time for taking the reins. Or as Lawrence Martin suggested in his column this morning

Nobleman Ignatieff has brought in new advisers, including some veteran Chrétien warriors. The Afghan detainees file is their first big test. We'll soon get an idea whether they will follow Mr. McKenna's advice and change course or whether it will be more of the same: Liberal popguns, Conservative cruise missiles.

Wallen Audio

I posted yesterday on Pamela Wallen's drinking of the Conservative kool-aide. Here is a link to the audio.

Ms. Wallen is the second former journalist to trade in their reputation for the party. As I noted earlier, Peter Kent has been doing the same, as has Lewis McKenzie.

This Time the Tragedy is Ours Too

I have been reading Philip Berrigan's wonderful autobiography, Fighting the Lamb`s War. More than anything else it is an account of what can happen when both morality and the rule of law are trumped by the pursuit of military goals no matter how noble. In the 1960s and 70s, the U.S. almost tore itself apart over an immoral and ultimately futile conflict. Though Canada supplied munitions and logistical support it largely avoided the catastrophe of Viet Nam.

This time we are not so lucky. It is becoming increasingly clear that the region is descending into a kind of moral chaos reminiscent of two generations ago, as this story from today`s Democracy Now so clearly shows



And given the allegations we have heard this week about Canada`s role in what may amount to war crimes, we are this time following them. It is time for our political leaders to make a stand: this war has become indefensible. This is not to besmirch the heroic effort made by our soldiers. It is to say that no more should be injured, killed or traumatized in pursuit of what are now unrealizable and unworthy goals.

Conservative Journalists' Hall of Shame

This is disgusting. Former journalist and Conservative Senator Pamela Wallen is on CBC's The Current this morning shilling for the Harper government on Afghanistan. A balanced report, it followed Wallen's breathtaking analysis with comment by two Conservative insiders. This is sad but not surprising, but what is is her willingness, given her reputation, to bend the truth to the needs of the government.

First she dismissed Richard Colvin's testimony, saying "I don't know what his motives were". His motives, Pam, were apparently to tell the truth, at considerable cost to himself.

Second, and much more egregious, she is suggesting that we are accusing front line CAF members of participating in torture. This is appalling. No one is suggesting that Canadian soldiers were complicit in this, or acted in anything but good faith. Senior officials are accused of ignoring overwhelming evidence that prisoners were handed over to abuse and torture. This is abetting. And abetting is a war crime. It is a crime in international law and a crime in Canadian law. No one is pronouncing anyone guilty. But a serious allegation has been made and it must be investigated.

Ms. Wallen has a sterling reputation. It is incredibly sad that it has been squandered in such a sad way.

Really, Lew?

Retired general, frequent commentator and former conservative candidate Lewis McKenzie has suggested a neat, plausible and wrong solution to the Afghan debacle: pass it back to the Military Police Complaints Commission.

Really, Lew?

As one report describes it

The Conservative government has gone to extraordinary lengths to try to prevent any public airing of how the CAF’s policy on Afghan detainees was developed and implemented.

It went to court to prevent the Military Police Complaints Commission (MPCC), an autonomous government agency, from investigating the Afghan detainee issue and since failing to obtain a court ruling entirely shutting down the MPCC inquiry has sought to systematically obstruct its work.

Last July the Justice Ministry sent letters to persons subpoenaed to appear before the MPCC to warn them against participating in pre-hearing interviews. To do so, the letter claimed would put their reputations at risk, could lead to public accusations they are lying, and might result in their having to bear the moral burden of unwittingly exposing members of the military and others to disciplinary penalties.

Later the government filed a motion to prevent 22 witnesses, including Colvin, from appearing before the MPCC on the grounds that their testimony would violate the national security provisions of the December 2001 Anti-Terrorism Act.

According to a lawyer for Amnesty International, which in conjunction with the British Columbia Civil Liberties Association first appealed to the MPCC to investigate the Afghan detainee issue, the government’s attempt to use the Anti-Terrorism Act to prevent CAF personnel and civil servants from testifying at the MPCC inquiry "demonstrates" that it "is willing to go to any lengths to prevent witnesses from testifying."

As a result of the government’s actions, the MPCC inquiry has yet to hear a single witness. In a further patent attempt to derail the MPCC inquiry, Defence Minster Peter MacKay announced in September that the current MPCC chair, Peter Tinsley, will be forced to immediately step down when his current contract ends on Dec. 11.

I am sure that the MPCC is capable of doing this work if the Harper government lets it. I am equally sure that it has no intention of doing so.

This is about war crimes. Crimes against humanity. So who are you shilling for, General McKenzie? Your former CAF colleagues? Or your political friends?

Your take on this one isn't credible.

The Muppets Bohemian Rhapsody -- A Classic

Another Voice

In a lead editorial today, the Globe & Mail lent its support to Richard Colvin, praising his courage in speaking out about the torture of Afghan detainees. It fell short, however, of calling for an independent judicial inquiry. It concluded that

[i]f his research is sound, Mr. Colvin could do nothing but speak out in these circumstances. If he is correct, Canada was engaged in an immoral and illegal exercise, under Canadian and international law. In doing so it was undermining the success of its mission. The Canadian Forces' own manual on how to conduct a counterinsurgency campaign makes clear that breaches of the law of armed conflict will send local citizens over to the side of the insurgents.

As I noted earlier today, neither Canada's image or the success of its counterinsurgency efforts are what is at stake here, as important as these may be. Mr. Colvin's allegations are that Canadian officials have contravened both international and Canadian law. Though he has not said it, Mr. Colvin has in effect accused them of abetting torture and hence of war crimes. It is trite, though sadly necessary, to say that this must be investigated.

Not Yet, Not Yet

The Globe & Mail's ROB had an interesting piece by Brian Milner yesterday on an interview with Harvard economic historian Niall Ferguson. While his is now a minority voice following the record run-up in stock prices this year, and while I believe his inflationary fears are dead wrong, he still bears listening to.

His concern is that the recovery that is underway is largely illusory, driven by unsustainable or one-time government expenditures and currency fluctuations. As he puts it

I don't think it's possible to infer from the stock market rally anything resembling a sustained recovery," the peripatetic professor says in an e-mail exchange. He rightly notes that at least half (and probably much more) of the third-quarter U.S. economic growth of 3.5 per cent stemmed from one-off government measures and that the consumer remains tapped out.

The stock market rally has been largely due to near-zero interest rates and a weaker dollar. In foreign currency terms there's been no rally.

And unlike so many others (see this entry in Paul Krugman's blog from earlier today) he puts his admittedly modest money where his mouth is, noting

I am out of U.S. stocks and currently have a modest cash pile. The commodity and stock market rally since March looks to me to be coming to an end. I am genuinely not sure what happens next.

Having narrowly avoided a Great Depression by using massive fiscal and monetary stimulus, we are now in uncharted waters.

Me too, Niall.

It is About War Crimes!

Last week I wrote a brief, tongue-in-cheek entry I titled "Rick Hillier -- War Criminal". Today comes news from CBC's The Current that two Canadian authorities on international law and the prosecution of war crimes, Payam Akhavan of McGill University and Errol Mendes of the University of Ottawa, are suggesting that the evidence presented by senior diplomat Richard Colvin last week requires at the very least an independent inquiry to determine if such crimes were committed by Canadians and thus if there is a need for prosecution of such crimes. Here is Professor Akhavan being interviewed by CBC Newsworld on this subject yesterday:


What both of these legal experts are concerned with is preservation of international law. They understand that the jobs of frontline soldiers are extremely difficult and both are clear that the responsibility does not lie here anyway, but with senior civilian and military officials who are alleged by Mr. Colvin to have approved such transfers with direct knowledge (from him) that abuse was a possibility if not a likelihood.

Nor must we wait for others to act. Canada has laws on the books regarding war crimes and crimes against humanity. As in international law, the standard is one of abetting, or knowingly handing over prisoners to likely abuse or torture. This is no longer about politics or ethics or reputation -- it is about enabling crimes against humanity.

Resign, Minister McKay.

A More Balanced View on Public Debt and Interest Rates

As usual, Krugman has a more nuanced and appropriate view on public debt and interest rates. I quote it in full:

On the face of it, there’s no reason to be worried about interest rates on US debt. Despite large deficits, the Federal government is able to borrow cheaply, at rates that are up from the early post-Lehman period, when market were pricing in a substantial probability of a second Great Depression, but well below the pre-crisis levels:

Underlying these low rates is, in turn, the fact that overall borrowing by the nonfinancial sector hasn’t risen: the surge in government borrowing has in fact, less than offset a plunge in private borrowing.

So what’s the problem?

Well, what I hear is that officials don’t trust the demand for long-term government debt, because they see it as driven by a “carry trade”: financial players borrowing cheap money short-term, and using it to buy long-term bonds. They fear that the whole thing could evaporate if long-term rates start to rise, imposing capital losses on the people doing the carry trade; this could, they believe, drive rates way up, even though this possibility doesn’t seem to be priced in by the market.

What’s wrong with this picture?

First of all, what would things look like if the debt situation were perfectly OK? The answer, it seems to me, is that it would look just like what we’re seeing.

Bear in mind that the whole problem right now is that the private sector is hurting, it’s spooked, and it’s looking for safety. So it’s piling into “cash”, which really means short-term debt. (Treasury bill rates briefly went negative yesterday). Meanwhile, the public sector is sustaining demand with deficit spending, financed by long-term debt. So someone has to be bridging the gap between the short-term assets the public wants to hold and the long-term debt the government wants to issue; call it a carry trade if you like, but it’s a normal and necessary thing.

Now, you could and should be worried if this thing looked like a great bubble — if long-term rates looked unreasonably low given the fundamentals. But do they? Long rates fluctuated between 4.5 and 5 percent in the mid-2000s, when the economy was driven by an unsustainable housing boom. Now we face the prospect of a prolonged period of near-zero short-term rates — I don’t see any reason for the Fed funds rate to rise for at least a year, and probably two — which should mean substantially lower long rates even if you expect yields eventually to rise back to 2005 levels. And if we’re facing a Japanese-type lost decade, which seems all too possible, long rates are in fact still unreasonably high.

Still, what about the possibility of a squeeze, in which rising rates for whatever reason produce a vicious circle of collapsing balance sheets among the carry traders, higher rates, and so on? Well, we’ve seen enough of that sort of thing not to dismiss the possibility. But if it does happen, it’s a financial system problem — not a deficit problem. It would basically be saying not that the government is borrowing too much, but that the people conveying funds from savers, who want short-term assets, to the government, which borrows long, are undercapitalized.

And the remedy should be financial, not fiscal. Have the Fed buy more long-term debt; or let the government issue more short-term debt. Whatever you do, don’t undermine recovery by calling off jobs creation.

The point is that it’s crazy to let the rescue of the economy be held hostage to what is, if it’s an issue at all, a technical matter of maturity mismatch. And again, it’s not clear that it even is an issue. What the worriers seem to regard as a danger sign — that supposedly awful carry trade — is exactly what you would expect to see even if fiscal policy were on a perfectly sustainable trajectory.

And one last point: I just don’t think the inner circle gets how much danger we’re in from another vicious circle, one that’s real, not hypothetical. The longer high unemployment drags on, the greater the odds that crazy people will win big in the midterm elections — dooming us to economic policy failure on a truly grand scale.