Declassified archives document ties between CIA and Nazis
By Andre Damon
27 July 2006

On June 6, the US national archives released some 27,000 pages of secret records documenting the CIA’s Cold War relations with former German Nazi Party members and officials.

The files reveal numerous cases of German Nazis, some clearly guilty of war crimes, receiving funds, weapons and employment from the CIA. They also demonstrate that US intelligence agencies deliberately refrained from disclosing information about the whereabouts of Adolf Eichmann in order to protect Washington’s allies in the post-war West German government headed by Christian Democratic leader Konrad Adenauer.

Eichmann, who had sent millions to their deaths while coordinating the Nazis’ “final solution” campaign to exterminate European Jewry, went into hiding in Buenos Aires after the fall of the Third Reich. Utilizing friendly contacts in the Catholic Church and the Peron government in Argentina, Eichmann was able to reside in the South American country for 10 years under the alias of Ricardo Klement. He was abducted in 1960 by Mossad, Israel’s foreign intelligence agency, put on trial in Israel and executed in 1962.

The documents show that the CIA was in possession of Eichmann’s pseudonym two years before the Mossad raid. The CIA received this information in 1958 from the West German government, which learned of Eichmann’s alias in 1952. Both the CIA and the Bonn government chose not to disclose this information to Israel because they were concerned that Eichmann might reveal the identities of Nazi war criminals holding high office in the West German government, particularly Adenauer’s national security adviser Hans Globke.

When Eichmann was finally brought to trial, the US government used all available means to protect its West German allies from what he might reveal. According to the declassified documents, the CIA pressured Life magazine into deleting references to Globke in portions of Eichmann’s memoirs that it chose to publish.

In addition to the revelations regarding Eichmann, the documents chronicle the CIA’s creation of “stay-behind” intelligence networks in southwestern Germany and Berlin, labeled “Kibitz” and “Pastime,” respectively. The Kibitz ring involved several former SS members. In the early 1950s, the CIA provided these groups with money, communications equipment and ammunition so that they could serve as intelligence assets in the event of a Soviet invasion of West Germany.

The CIA documents were reviewed by Timothy Naftali, a historian with the National Archives Interagency Working Group, the government body that oversaw their declassification and release. According to an article published by Naftali, the stay-behind program was dissolved “in the wake of public concerns in West Germany about the resurgence of Neo-Nazi Groups.” Specifically, the Kibitz-15 group, led by an “unreconstructed Nazi,” became a potential source of public embarrassment for the US, as its members were broadly involved in Neo-Nazi activity. [1]

The CIA terminated the program by 1955 and arranged for many of its contacts to be resettled in Canada and Australia. According to the documents, Australia provided funds for relocation while the CIA provided its ex-assets with a “resettlement bonus.”

The CIA employed Gustav Hilger, a former adviser to Nazi Foreign Minister Joachim von Ribbentrop. As an employee of the German foreign office, Hilger was present at the negotiation of the Stalin-Hitler pact in 1939. The CIA deemed his experience with the USSR sufficiently valuable to free him from incarceration at Fort Meade in Maryland and employ him as an intelligence evaluator in West Germany.

In 1948, Hilger moved to the United States and obtained a position at the CIA’s K Street building in Washington as a researcher and expert on the USSR. Hilger eventually left the CIA to work for the West German foreign office.

According to a paper analyzing the CIA documents published by Robert Wolfe, a former senior archivist at the US National Archives, “it is beyond dispute that Hilger criminally assisted in the genocide of Italy’s Jews…. During the roundup of Italian Jews in late 1943, a note signed ‘Hilger’ recorded Ribbentrop’s concurrence that the Italians be asked to intern the Jews in concentration camps in Northern Italy, in lieu of immediate deportation. The SS intended thereby that the Italian Jews and their potential Italian protectors should believe that internment in Italy was the final destination, rather than eventual deportation to the murder mills in Poland to be immediately murdered or gradually worked to death. The stated purpose of this ruse was to minimize the number of Italian Jews who would go into hiding to avoid deportation to Poland” [2]

In another instance, the CIA employed Tscherim Soobzokov, a former Nazi gendarme and Waffen SS lieutenant, who, according to a paper published by Interagency Working Group Director of Historical Research Richard Breitman, “participated in an execution commando [combat group detailed to executing Jews and Communists en masse] and had searched North Caucasian villages for Jews.”

Soobzokov was employed by the CIA for seven years. Over this period, he repeatedly used his intelligence contacts to avoid investigation by the FBI and the US Immigration and Naturalization Service (INS) in regard to his complicity in war crimes.

According to Breitman’s paper, CIA examiners noted that Soobzokov was an “incorrigible fabricator” who repeatedly lied about his past in order to conceal his participation in criminal activity. Nevertheless, the CIA shielded him against investigation, at one point sending the INS a document asserting that Soobzokov had never worked for the Nazis. [3]

Prior to the outbreak of war, a significant section of the American ruling elite had favored cooperation with the Nazis as a European hedge against the spread of Bolshevism. Henry Ford was notorious for his anti-Semitism and his political affinity for German Fascism, and a number of major American companies retained their business ties with the Third Reich. Notably, IBM sold Germany the punch cards that were used to catalog the “final solution.” (See: “How IBM helped the Nazis IBM and the Holocaust”)

However, as one European nation after another fell before Hitler’s onslaught, the threat of German imperialist dominance in Europe spurred the American ruling class to enter the European theater.

US imperialism mobilized popular support in its war against the Nazi regime by appealing to the democratic and anti-fascist sentiments of the American people. After the defeat of Germany, it organized, together with its World War II allies—Britain, the Soviet Union and France—the Nuremburg trials to prosecute top Nazi officials for their complicity in war crimes.

However, with the start of the Cold War, the United States reversed its policy of identifying, trying and executing prominent Nazi war criminals. As is starkly demonstrated in the case of Eichmann, the knowledge possessed by many of these individuals made trying them inconvenient.

Regardless of its limited prosecution of upper-echelon Nazis, the United States had no qualms about recruiting Nazi Party members and war criminals into its military research apparatus. Prominent German military developers such as Werner Von Braun and Bernhard Tessmann were assimilated into the US rocketry program, while Kurt Blome, a Nazi scientist who experimented on concentration camp prisoners, was employed by the US to develop chemical weapons.

Likewise, the early stages of the Cold War saw high-level Nazi cadres drafted into the US intelligence machine and deployed in Europe, the Middle East and the Americas. According to the Department of Justice Office of Special Investigations (OSI), the bureau assigned to investigate German war criminals living within the US, at least 10,000 Nazis entered the US between 1948 and 1952. Of the thousands of German Nazis who fled—or were brought—to the United States, only some 100 have been prosecuted by the OSI.

Notes:
1. Timothy Naftali, “New Information on Cold War CIA Stay-Behind Operations in Germany and on the Adolf Eichmann Case” http://www.fas.org/sgp/eprint/naftali.pdf
2. Robert Wolfe, “Gustav Hilger: From Hitler’s Foreign Office to CIA Consultant” http://www.fas.org/sgp/eprint/wolfe.pdf
3. Richard Breitman, “Tscherim Soobzokov” http://www.fas.org/sgp/eprint/breitman.pdf

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Don’t Be Terrorized
You’re more likely to die of a car accident, drowning, fire, or murder
By Ronald Bailey
August 11, 2006

Yesterday, British authorities broke up an alleged terror plot to blow up as many as ten commercial airliners as they flew to the United States. In response, the Department of Homeland Security upped the alert level on commercial flights from Britain to “red” and boosted the alert to “orange” for all other flights. In a completely unscientific poll, AOL asked subscribers: “Are you changing your travel plans because of the raised threat level?” At mid-afternoon about a quarter of the respondents had said yes. Such polls do reflect the kinds of anxieties terrorist attacks, even those that have been stymied, provoke in the public.

But how afraid should Americans be of terrorist attacks? Not very, as some quick comparisons with other risks that we regularly run in our daily lives indicate. Your odds of dying of a specific cause in any year are calculated by dividing that year’s population by the number of deaths by that cause in that year. Your lifetime odds of dying of a particular cause are calculated by dividing the one-year odds by the life expectancy of a person born in that year. For example, in 2003 about 45,000 Americans died in motor accidents out of population of 291,000,000. So, according to the National Safety Council this means your one-year odds of dying in a car accident is about one out of 6500. Therefore your lifetime probability (6500 ÷ 78 years life expectancy) of dying in a motor accident are about one in 83.

What about your chances of dying in an airplane crash? A one-year risk of one in 400,000 and one in 5,000 lifetime risk. What about walking across the street? A one-year risk of one in 48,500 and a lifetime risk of one in 625. Drowning? A one-year risk of one in 88,000 and a one in 1100 lifetime risk. In a fire? About the same risk as drowning. Murder? A one-year risk of one in 16,500 and a lifetime risk of one in 210. What about falling? Essentially the same as being murdered. And the proverbial being struck by lightning? A one-year risk of one in 6.2 million and a lifetime risk of one in 80,000. And what is the risk that you will die of a catastrophic asteroid strike? In 1994, astronomers calculated that the chance was one in 20,000. However, as they’ve gathered more data on the orbits of near earth objects, the lifetime risk has been reduced to one in 200,000 or more.

So how do these common risks compare to your risk of dying in a terrorist attack? To try to calculate those odds realistically, Michael Rothschild, a former business professor at the University of Wisconsin, worked out a couple of plausible scenarios. For example, he figured that if terrorists were to destroy entirely one of America’s 40,000 shopping malls per week, your chances of being there at the wrong time would be about one in one million or more. Rothschild also estimated that if terrorists hijacked and crashed one of America’s 18,000 commercial flights per week that your chance of being on the crashed plane would be one in 135,000.

Even if terrorists were able to pull off one attack per year on the scale of the 9/11 atrocity, that would mean your one-year risk would be one in 100,000 and your lifetime risk would be about one in 1300. (300,000,000 ÷ 3,000 = 100,000 ÷ 78 years = 1282) In other words, your risk of dying in a plausible terrorist attack is much lower than your risk of dying in a car accident, by walking across the street, by drowning, in a fire, by falling, or by being murdered.

So do these numbers comfort you? If not, that’s a problem. Already, security measures—pervasive ID checkpoints, metal detectors, and phalanxes of security guards—increasingly clot the pathways of our public lives. It’s easy to overreact when an atrocity takes place—to heed those who promise safety if only we will give the authorities the “tools” they want by surrendering to them some of our liberty. As President Franklin Roosevelt in his first inaugural speech said, “The only thing we have to fear is fear itself— nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.” However, with risks this low there is no reason for us not to continue to live our lives as though terrorism doesn’t matter—because it doesn’t really matter. We ultimately vanquish terrorism when we refuse to be terrorized.

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Iran Proposal to U.S. Offered Peace with Israel
by Gareth Porter
May 25, 2006

WASHINGTON – Iran offered in 2003 to accept peace with Israel and to cut off material assistance to Palestinian armed groups and pressure them to halt terrorist attacks within Israel’s 1967 borders, according to the secret Iranian proposal to the United States. The two-page proposal for a broad Iran-U.S. agreement covering all the issues separating the two countries, a copy of which was obtained by IPS, was conveyed to the United States in late April or early May 2003. Trita Parsi, a specialist on Iranian foreign policy at Johns Hopkins University School of Advanced International Studies who provided the document to IPS, says he got it from an Iranian official earlier this year but is not at liberty to reveal the source.

The two-page document contradicts the official line of the George W. Bush administration that Iran is committed to the destruction of Israel and the sponsorship of terrorism in the region.

Parsi says the document is a summary of an even more detailed Iranian negotiating proposal which he learned about in 2003 from the U.S. intermediary who carried it to the State Department on behalf of the Swiss Embassy in late April or early May 2003. The intermediary has not yet agreed to be identified, according to Parsi.

The Iranian negotiating proposal indicated clearly that Iran was prepared to give up its role as a supporter of armed groups in the region in return for a larger bargain with the United States. What the Iranians wanted in return, as suggested by the document itself as well as expert observers of Iranian policy, was an end to U.S. hostility and recognition of Iran as a legitimate power in the region.

Before the 2003 proposal, Iran had attacked Arab governments which had supported the Israeli-Palestinian peace process. The negotiating document, however, offered “acceptance of the Arab League Beirut declaration”, which it also referred to as the “Saudi initiative, two-states approach.”

The March 2002 Beirut declaration represented the Arab League’s first official acceptance of the land-for-peace principle as well as a comprehensive peace with Israel in return for Israel’s withdrawal to the territory it had controlled before the 1967 war.. Iran’s proposed concession on the issue would have aligned its policy with that of Egypt and Saudi Arabia, among others with whom the United States enjoyed intimate relations.

Another concession in the document was a “stop of any material support to Palestinian opposition groups (Hamas, Jihad, etc.) from Iranian territory” along with “pressure on these organizations to stop violent actions against civilians within borders of 1967”.

Even more surprising, given the extremely close relationship between Iran and the Lebanon-based Hizbollah Shiite organisation, the proposal offered to take “action on Hizbollah to become a mere political organization within Lebanon”.

The Iranian proposal also offered to accept much tighter controls by the International Atomic Energy Agency (IAEA) in exchange for “full access to peaceful nuclear technology”. It offered “full cooperation with IAEA based on Iranian adoption of all relevant instruments (93+2 and all further IAEA protocols)”.

That was a reference to protocols which would require Iran to provide IAEA monitors with access to any facility they might request, whether it had been declared by Iran or not. That would have made it much more difficult for Iran to carry out any secret nuclear activities without being detected.

In return for these concessions, which contradicted Iran’s public rhetoric about Israel and anti-Israeli forces, the secret Iranian proposal sought U.S. agreement to a list of Iranian aims. The list included a “Halt in U.S. hostile behavior and rectification of status of Iran in the U.S.”, as well as the “abolishment of all sanctions”.

Also included among Iran’s aims was “recognition of Iran’s legitimate security interests in the region with according defense capacity”. According to a number of Iran specialists, the aim of security and an official acknowledgment of Iran’s status as a regional power were central to the Iranian interest in a broad agreement with the United States.

Negotiation of a deal with the United States that would advance Iran’s security and fundamental geopolitical political interests in the Persian Gulf region in return for accepting the existence of Israel and other Iranian concessions has long been discussed among senior Iranian national security officials, according to Parsi and other analysts of Iranian national security policy.

An Iranian threat to destroy Israel has been a major propaganda theme of the Bush administration for months. On Mar. 10, Bush said, “The Iranian president has stated his desire to destroy our ally, Israel. So when you start listening to what he has said to their desire to develop a nuclear weapon, then you begin to see an issue of grave national security concern.”

But in 2003, Bush refused to allow any response to the Iranian offer to negotiate an agreement that would have accepted the existence of Israel. Flynt Leverett, then the senior specialist on the Middle East on the National Security Council staff, recalled in an interview with IPS that it was “literally a few days” between the receipt of the Iranian proposal and the dispatch of a message to the Swiss ambassador expressing displeasure that he had forwarded it to Washington.

Interest in such a deal is still very much alive in Tehran, despite the U.S. refusal to respond to the 2003 proposal. Turkish international relations professor Mustafa Kibaroglu of Bilkent University writes in the latest issue of Middle East Journal that “senior analysts” from Iran told him in July 2005 that “the formal recognition of Israel by Iran may also be possible if essentially a ‘grand bargain’ can be achieved between the U.S. and Iran”.

The proposal’s offer to dismantle the main thrust of Iran’s Islamic and anti-Israel policy would be strongly opposed by some of the extreme conservatives among the mullahs who engineered the repression of the reformist movement in 2004 and who backed President Mahmoud Ahmadinejad in last year’s election.

However, many conservative opponents of the reform movement in Iran have also supported a negotiated deal with the United States that would benefit Iran, according to Paul Pillar, the former national intelligence officer on Iran. “Even some of the hardliners accepted the idea that if you could strike a deal with the devil, you would do it,” he said in an interview with IPS last month.

The conservatives were unhappy not with the idea of a deal with the United States but with the fact that it was a supporter of the reform movement of Pres. Mohammad Khatami, who would get the credit for the breakthrough, Pillar said.

Parsi says that the ultimate authority on Iran’s foreign policy, Iran’s Supreme Leader Ayatollah Ali Khamenei, was “directly involved” in the Iranian proposal, according to the senior Iranian national security officials he interviewed in 2004. Kamenei has aligned himself with the conservatives in opposing the pro-democratic movement.

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Wait, Aren’t You Scared?
Governors object to Bush’s Guard plan
Rev. John Hagee’s War
The Pentagon’s "Second 911"
and much more, thanks to American Samizdat…

Muslims bristle at Bush term "Islamic fascists"
By Amanda Beck
Aug 10, 2006

WASHINGTON – U.S. Muslim groups criticized President Bush on Thursday for calling a foiled plot to blow up airplanes part of a “war with Islamic fascists,” saying the term could inflame anti-Muslim tensions.

U.S. officials have said the plot, thwarted by Britain, to blow up several aircraft over the Atlantic bore many of the hallmarks of al Qaeda.

“We believe this is an ill-advised term and we believe that it is counterproductive to associate Islam or Muslims with fascism,” said Nihad Awad, executive director of the Council on American-Islamic Relations advocacy group.

“We ought to take advantage of these incidents to make sure that we do not start a religious war against Islam and Muslims,” he told a news conference in Washington.

“We urge him (Bush) and we urge other public officials to restrain themselves.”

Awad said U.S. officials should take the lead from their British counterparts who steered clear of using what he considered inflammatory terms when they announced the arrest of more than 20 suspects in the reported plot.

Hours after the news broke, Bush said it was “a stark reminder that this nation is at war with Islamic fascists who will use any means to destroy those of us who love freedom, to hurt our nation.”

Bush and other administration officials have used variations of the term “Islamo-fascism” on several occasions in the past to describe militant groups including al Qaeda, its allies in Iraq and Hizbollah in Lebanon.

Homeland Security Secretary Michael Chertoff told MSNBC television the phrase reflected what he called Osama bin Laden’s own vision of leading a totalitarian empire under the guise of religion.

“It might may not be classic fascism as you had with Mussolini or Hitler. But it is a totalitarian, intolerant imperialism that has a vision that is totally at odds with Western society and our rules of law,” Chertoff said.

MUSLIM CONCERNS
Many American Muslims, who say they have felt singled out for discrimination since the September 11 attacks, reject the term and say it unfairly links their faith to notions of dictatorship, oppression and racism.

“The problem with the phrase is it attaches the religion of Islam to tyranny and fascism, rather than isolating the threat to a specific group of individuals,” said Edina Lekovic, spokeswoman for the Muslim Public Affairs Council in Los Angeles.

She said the terms cast suspicions on all Muslims, even the vast majority who want to live in safety like other Americans.

Bush upset many Muslims after the September 11 attacks by referring to the global war against terrorism early on as a “crusade,” a term which for many Muslims connotes a Christian battle against Islam. The White House quickly stopped using the word, expressing regrets if it had caused offense.

Mohamed Elibiary, a Texas-based Muslim activist, said he was upset by the president’s latest comments.

“We’ve got Osama bin Laden hijacking the religion in order to define it one way. … We feel the president and anyone who’s using these kinds of terminologies is hijacking it too from a different side,” he said.

What’s the real federal deficit?
By Dennis Cauchon
8/4/2006

The federal government keeps two sets of books.

The set the government promotes to the public has a healthier bottom line: a $318 billion deficit in 2005.

The set the government doesn’t talk about is the audited financial statement produced by the government’s accountants following standard accounting rules. It reports a more ominous financial picture: a $760 billion deficit for 2005. If Social Security and Medicare were included – as the board that sets accounting rules is considering – the federal deficit would have been $3.5 trillion.

Congress has written its own accounting rules – which would be illegal for a corporation to use because they ignore important costs such as the growing expense of retirement benefits for civil servants and military personnel.

Last year, the audited statement produced by the accountants said the government ran a deficit equal to $6,700 for every American household. The number given to the public put the deficit at $2,800 per household.

A growing number of Congress members and accounting experts say it’s time for Congress to start using the audited financial statement when it makes budget decisions. They say accurate accounting would force Congress to show more restraint before approving popular measures to boost spending or cut taxes.

“We’re a bottom-line culture, and we’ve been hiding the bottom line from the American people,” says Rep. Jim Cooper, D-Tenn., a former investment banker. “It’s not fair to them, and it’s delusional on our part.”

The House of Representatives supported Cooper’s proposal this year to ask the president to include the audited numbers in his budgets, but the Senate did not consider the measure.

Good accounting is crucial at a time when the government faces long-term challenges in paying benefits to tens of millions of Americans for Medicare, Social Security and government pensions, say advocates of stricter accounting rules in federal budgeting.

“Accounting matters,” says Harvard University law professor Howell Jackson, who specializes in business law. “The deficit number affects how politicians act. We need a good number so politicians can have a target worth looking at.”

The audited financial statement — prepared by the Treasury Department — reveals a federal government in far worse financial shape than official budget reports indicate, a USA TODAY analysis found. The government has run a deficit of $2.9 trillion since 1997, according to the audited number. The official deficit since then is just $729 billion. The difference is equal to an entire year’s worth of federal spending.

Surplus or deficit?
Congress and the president are able to report a lower deficit mostly because they don’t count the growing burden of future pensions and medical care for federal retirees and military personnel. These obligations are so large and are growing so fast that budget surpluses of the late 1990s actually were deficits when the costs are included.

The Clinton administration reported a surplus of $559 billion in its final four budget years. The audited numbers showed a deficit of $484 billion.

In addition, neither of these figures counts the financial deterioration in Social Security or Medicare. Including these retirement programs in the bottom line, as proposed by a board that oversees accounting methods used by the federal government, would show the government running annual deficits of trillions of dollars.

The Bush administration opposes including Social Security and Medicare in the audited deficit. Its reason: Congress can cancel or cut the retirement programs at any time, so they should not be considered a government liability for accounting purposes.

Policing the numbers
The government’s record-keeping was in such disarray 15 years ago that both parties agreed drastic steps were needed. Congress and two presidents took a series of actions from 1990 to 1996 that:

• Created the Federal Accounting Standards Advisory Board to establish accounting rules, a role similar to what the powerful Financial Accounting Standards Board does for corporations.
• Added chief financial officers to all major government departments and agencies.Required annual audited financial reports of those departments and agencies.Ordered the Treasury Department to publish, for the first time, a comprehensive annual financial report for the federal government — an audited report like those published every year by corporations.

These laws have dramatically improved federal financial reporting. Today, 18 of 24 departments and agencies produce annual reports certified by auditors. (The others, including the Defense Department, still have record-keeping troubles so severe that auditors refuse to certify the reliability of their books, according to the government’s annual report.)

The culmination of improved record-keeping is the “Financial Report of the U.S. Government,” an annual report similar to a corporate annual report. (The 158-page report for 2005 is available online at fms.treas.gov/fr/index.html.)

The House Budget Committee has tried to increase the prominence of the audited financial results. When the House passed its version of a budget this year, it included Cooper’s proposal asking Bush to add the audited numbers to the annual budget he submits to Congress. The request died when the House and Senate couldn’t agree on a budget. Cooper has reintroduced the proposal.

The Federal Accounting Standards Advisory Board, established under the first President Bush in 1990 to set federal accounting rules, is considering adding Social Security and Medicare to the government’s audited bottom line.

Recognizing costly programs
Adding those costs would make federal accounting similar to that used by corporations, state and local governments and large non-profit entities such as universities and charities. It would show the government recording enormous losses because the deficit would reflect the growing shortfalls in Social Security and Medicare.

The government would have reported nearly $40 trillion in losses since 1997 if the deterioration of Social Security and Medicare had been included, according to a USA TODAY analysis of the proposed accounting change. That’s because generally accepted accounting principles require reporting financial burdens when they are incurred, not when they come due.

For example: If Microsoft announced today that it would add a drug benefit for its retirees, the company would be required to count the future cost of the program, in today’s dollars, as a business expense. If the benefit cost $1 billion in today’s dollars and retirees were expected to pay $200 million of the cost, Microsoft would be required to report a reduction in net income of $800 million.

This accounting rule is a major reason corporations have reduced and limited retirement benefits over the last 15 years.

The federal government’s audited financial statement now accounts for the retirement costs of civil servants and military personnel – but not the cost of Social Security and Medicare.

The new Medicare prescription-drug benefit alone would have added $8 trillion to the government’s audited deficit. That’s the amount the government would need today, set aside and earning interest, to pay for the tens of trillions of dollars the benefit will cost in future years.

Standard accounting concepts say that $8 trillion should be reported as an expense. Combined with other new liabilities and operating losses, the government would have reported an $11 trillion deficit in 2004 — about the size of the nation’s entire economy.

The federal government also would have had a $12.7 trillion deficit in 2000 because that was the first year that Social Security and Medicare reported broader measures of the programs’ unfunded liabilities. That created a one-time expense.

The proposal to add Social Security and Medicare to the bottom line has deeply divided the federal accounting board, composed of government officials and “public” members, who are accounting experts from outside government.

The six public members support the change. “Our job is to give people a clear picture of the financial condition of the government,” board Chairman David Mosso says. “Whether those numbers are good or bad and what you do about them is up to Congress and the administration.”

The four government members, who represent the president, Congress and the Government Accountability Office, oppose the change. The retirement programs do “not represent a legal obligation because Congress has the authority to increase or reduce social insurance benefits at any time,” wrote Clay Johnson III, then acting director of the president’s Office of Management Budget, in a letter to the board in May.

Ways of accounting
Why the big difference between the official government deficit and the audited one?

The official number is based on “cash accounting,” similar to the way you track what comes into your checking account and what goes out. That works fine for paying today’s bills, but it’s a poor way to measure a financial condition that could include credit card debt, car loans, a mortgage and an overdue electric bill.

The audited number is based on accrual accounting. This method doesn’t care about your checking account. It measures income and expenses when they occur, or accrue. If you buy a velvet Elvis painting online, the cost goes on the books immediately, regardless of when the check clears or your eBay purchase arrives.

Cash accounting lets income and expenses land in different reporting periods. Accrual accounting links them. Under cash accounting, a $25,000 cash advance on a credit card to pay for a vacation makes the books look great. You are $25,000 richer! Repaying the credit card debt? No worries today. That will show up in the future.

Under accrual accounting, the $25,000 cash from your credit card is offset immediately by the $25,000 you now owe. Your bottom line hasn’t changed. An accountant might even make you report a loss on the transaction because of the interest you’re going to pay.

“The problem with cash accounting is that there’s a tremendous opportunity for manipulation,” says University of Texas accounting professor Michael Granof. “It’s not just that you fool others. You end up fooling yourself, too.”

Federal law requires that companies and institutions that have revenue of $1 million or more use accrual accounting. Microsoft used accrual accounting when it reported $12 billion in net income last year. The American Red Cross used accrual accounting when it reported a $445 million net gain.

Congress used cash accounting when it reported the $318 billion deficit last year.

Social Security chief actuary Stephen Goss says it would be a mistake to apply accrual accounting to Social Security and Medicare. These programs are not pensions or legally binding federal obligations, although many people view them that way, he says.

Social Security and Medicare are pay-as-you go programs and should be treated like food stamps and fighter jets, not like a Treasury bond that must be repaid in the future, he adds. “A country doesn’t record a liability every time a kid is born to reflect the cost of providing that baby with a K-12 education one day,” Goss says.

Tom Allen, who will become the chairman of the federal accounting board in December, says sound accounting principles require that financial statements reflect the economic value of an obligation.

“It’s hard to argue that there’s no economic substance to the promises made for Social Security and Medicare,” he says.

Social Security and Medicare should be reflected in the bottom line because that’s the most important number in any financial report, Allen says.

“The point of the number is to tell the public: Did the government’s financial condition improve or deteriorate over the last year?” he says.

If you count Social Security and Medicare, the federal government’s financial health got $3.5 trillion worse last year.

Rep. Mike Conaway, R-Texas, a certified public accountant, says the numbers reported under accrual accounting give an accurate picture of the government’s condition. “An old photographer’s adage says, ‘If you want a prettier picture, bring me a prettier face,’ ” he says.

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See, in my line of work you got to keep repeating things over and over and over again for the truth to sink in… to kind of catapult the propaganda.
     — George W. Bush, May 24, 2005

… people will believe a big lie sooner than a little one; and if you repeat it frequently enough people will sooner or later believe it.
     — OSS Report on Adolph Hitler, page 51

All this was inspired by the principle – which is quite true in itself – that in the big lie there is always a certain force of credibility; because the broad masses of a nation are always more easily corrupted in the deeper strata of their emotional nature than consciously or voluntarily; and thus in the primitive simplicity of their minds they more readily fall victims to the big lie than the small lie, since they themselves often tell small lies in little matters but would be ashamed to resort to large-scale falsehoods.
     — Adolph Hitler, Mein Kampf, 1925

The Big Lie Technique
By Robert Scheer
November 16, 2005

At a time when approximately 57 percent of Americans polled believe that President Bush deceived them on the reasons for the war in Iraq, it does seem a bit redundant to deconstruct the President’s recent speeches on that subject. Yet, to fail to do so would be to passively accept the Big Lie technique–which is how we as a nation got into this horrible mess in the first place.

The basic claim of the President’s desperate and strident attack on the war’s critics this past week is that he was acting as a consensus President when intelligence information left him no choice but to invade Iraq as a preventive action to deter a terrorist attack on America. This is flatly wrong.

His rationalization for attacking Iraq, once accepted uncritically by most in Congress and the media easily intimidated by jingoism, now is known to be false. The bipartisan 9/11 Commission selected by Bush concluded unanimously that there was no link between Al Qaeda and Saddam Hussein’s secular dictatorship, Al Qaeda’s sworn enemy. And a recently declassified 2002 document proves that Bush’s “evidence” for this, available to top Administration officials, was based on a single discredited witness.

Clearly on the defensive, Bush now sounds increasingly Nixonian as he basically calls the majority of the country traitors for noticing he tricked us.

“Reasonable people can disagree about the conduct of the war, but it is irresponsible for Democrats to now claim that we misled them and the American people,” the President said at an Air Force base in Alaska. “Leaders in my Administration and members of the United States Congress from both political parties looked at the same intelligence on Iraq, and reached the same conclusion: Saddam Hussein was a threat.”

This is a manipulative distortion; saying Hussein was a threat–to somebody, somewhere, in some context–is not the same as endorsing a pre-emptive occupation of his country in a fantastically expensive and blatantly risky nation-building exercise. And the idea that individual senators and members of Congress had the same access to even a fraction of the raw intelligence as the President of the United States is just a lie on its face–it is a simple matter of security clearances, which are not distributed equally.

It was enormously telling, in fact, that the only part of the Senate which did see the un-sanitized National Intelligence Estimate on Iraq–the Republican-led Senate Select Intelligence Committee–shockingly voted in the fall of 2002 against the simple authorization of force demanded by a Republican President. Panicked, the warmongers in the White House and Pentagon pressured CIA Director George Tenet to rush release to the entire Hill a very short “summary” of the careful NIE, which made Hussein seem incalculably more dangerous than the whole report indicated.

The Defense Intelligence Agency finally declassified its investigative report, DITSUM No. 044-02, within recent days. This smoking-gun document proves the Bush Administration’s key evidence for the apocryphal Osama bin Laden-Saddam Hussein alliance–said by Bush to involve training in the use of weapons of mass destruction–was built upon the testimony of a prisoner who, according to the DIA, was probably “intentionally misleading the debriefers.”

Yet, despite the government having been informed of this by the Pentagon’s intelligence agency in February 2002, Bush told the nation eight months later, on the eve of the Senate’s vote to authorize the war, that “we’ve learned that Iraq has trained Al Qaeda members in bomb-making and poisons and gases.”

The false Al Qaeda-Hussein link was the linchpin to Bush’s argument that he could not delay the invasion until after the United Nations weapons inspectors completed their investigation in a matter of months. Perhaps, he feared not that those weapons would fall into the wrong hands but that they would not be found at all.

Boxed in by international sanctions, weapons inspectors, US fighter jets patrolling two huge no-fly zones and powerful rivals on all his borders, Hussein in 2003 was decidedly not a threat to America. But the Bush White House wanted a war with Iraq, and it pulled out all the stops–references to “a mushroom cloud” and calling Hussein an “ally” of Al Qaeda–to convince the rest of us it was necessary.

The White House believed the ends (occupying Iraq) justified the means (exaggerating the threat). We know now those ends have proved disastrous.

Oblivious to the grim irony, Bush proclaims his war without end in Iraq the central front in a new cold war, never acknowledging that he has handed Al Qaeda terrorists a new home base. Iran, his “Axis of Evil” member, now has its disciples in power in Iraq. Last week, top Bush Administration officials welcomed to Washington Iraq Deputy Prime Minister Ahmed Chalabi, who previously was denounced for having allegedly passed US secrets to his old supporters in Tehran and was elected to a top post in Iraq by campaigning on anti-US slogans.

Under Bush’s watch, we not only suffered the September 11 terrorist attacks while he snoozed, but he has failed to capture the perpetrator of those attacks and has given Al Qaeda a powerful base in Iraq from which to terrorize. And this is the guy who dares tell his critics they are weakening our country.

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to further my rant from earlier, this was apparently an either incredibly conveniently timed “terrorist” event, or it was completely made up to distract us while "they" sneak around behind our backs and propose retroactive protection for anyone who does something that is later determined to be a war crime, which is in violation of the article I section 9 proscription on ex post facto legislation, and the bill which abolishes the bill of rights all together.

if it was a real “terrorist” act that was “foiled” this morning, it was coincidentally well timed, but since we haven’t seen the “terrorists” in custody, and the authorities won’t comment on what kind of bomb they were allegedly trying to smuggle on an airplane, the whole thing sounds quite fishy, and it wouldn’t surprise me at all if this were just a ruse to cause us to look the other way while "they" take a few more whacks at our already teetering rights.

wake up folks. it won’t be long until we have no rights and no way of complaining about it. if we don’t do something soon, it will be too late, and we’ll end up just like pre-world-war-two germany, with jack-booted thugs wandering the streets, beating people up who don’t have the proper identity papers… 8(

White House proposes retroactive war crimes protection
Moves to shield policy makers
By Pete Yost
August 10, 2006

WASHINGTON — The Bush administration drafted amendments to the War Crimes Act that would retroactively protect policy makers from possible criminal charges for authorizing any humiliating and degrading treatment of detainees, according to lawyers who have seen the proposal.

The move by the administration is the latest effort to deal with the treatment of those taken into custody in the war on terror.

At issue are interrogations carried out by the CIA and the degree to which harsh tactics such as water-boarding were authorized by administration officials. A separate law, the Uniform Code of Military Justice, applies to the military. When interrogators engage in waterboarding, prisoners are strapped to a plank and dunked in water until nearly drowning.

One section of the draft would outlaw torture and inhuman or cruel treatment, but it does not contain prohibitions from Article 3 of the Geneva Conventions against “outrages upon personal dignity, in particular humiliating and degrading treatment.”

Another section would apply the legislation retroactively, according to two lawyers who have seen the contents of the section and who spoke on the condition of anonymity because their sources did not authorize them to release the information.

One of the two lawyers said that the draft is in the revision stage, but that the administration seems intent on pushing forward the draft’s major points in Congress after Labor Day.

“I think what this bill can do is in effect immunize past crimes. That’s why it’s so dangerous,” said a third lawyer, Eugene Fidell, president of the National Institute of Military Justice.

Fidell said the initiative is “not just protection of political appointees, but also CIA personnel who led interrogations.”

Interrogation practices “follow from policies that were formed at the highest levels of the administration,” said a fourth lawyer, Scott Horton, who has followed detainee issues closely. “The administration is trying to insulate policy makers under the War Crimes Act.”

A White House spokesman said Common Article 3 of the Geneva Conventions includes a number of vague terms that are susceptible to different interpretations.

The administration believes it is very important to bring clarity to the War Crimes Act so that those on the front lines in the war on terror “have clear rules that are defined in law,” said the White House spokesman.

Extreme interrogation practices have been a flash point for criticism of the Bush administration.

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