The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally

By Timothy D. Naegele[1]

The Wall Street Journal has an article about the EU entitled, “Currency Union Teetering, ‘Mr. Euro’ Was Forced to Act,” which is worth reading and reflecting on seriously.[2] It represents an excellent discussion of what has happened in the past.  However, its conclusions are sobering and ominous:

[F]our months later, the root causes of the Greek crisis remain: There is no central authority to even coordinate national tax-and-spending policies.

In the past month, financial markets have turned their sights on Ireland and Portugal. Doubts remain over the solvency of banks on Europe’s stricken fringe. That leaves them dependent on [the European Central Bank president Jean-Claude Trichet]’s largesse, in the form of “temporary” lending facilities introduced by the ECB when the crisis first hit.

Despite Mr. Trichet’s assurances that the bond-buying program is a stop-gap, it not only continues but has also increased in recent weeks—with no end in sight.

Put succinctly, Europe is still on the brink. It is foolish to believe otherwise. The “green shoots” that have appeared recently are an “illusion” and merely a brief respite in the midst of a maelstrom, which economic historians will describe as the “Great Depression II” (or by some similar name) 20-40 years from now.

Americans and their counterparts around the world have lost faith in their governments, and rightly so[3]; and the governments have come closer to exhausting all of their viable economic options. As this becomes increasingly clear, and as governments thrash about trying to find solutions that do not exist, and as politicians continue to lie—which after all is what they are most proficient at doing—the economic tsunami will continue to take its toll and run its course worldwide during the balance of this decade.

It will get very ugly, economically, socially and politically. Barack Obama will be swept out of office in the United States, and this process has begun already. It will accelerate with November’s elections. He is caught in the twin pincers of an economy in decline that he cannot influence except negatively, and an Afghan war that cannot be won. Republicans and Independents do not support him now; and his own Democrats are deserting him.

The slippery slope out the White House door will follow, like it did for Lyndon Johnson prior to the presidential election of 1968, when the political consequences of the Vietnam war made him unelectable.  Obama will return either to Chicago or Honolulu to lick his wounds and set up his presidential library, and assume an “elder statesman” role—similar to Bill Clinton—after only one term in office.

The efforts of Jean-Claude Trichet, or “Mr. Euro,” will prove similar to measures undertaken to put Humpty Dumpty back together again.  Trichet is not “Superman,” and he will lack the necessary skills; and the policy options will have been exhausted. Panics may ensue in the financial markets; and the recent crises may seem like child’s play by comparison to what is coming. The “Band-Aids” that Trichet, America’s Federal Reserve Chairman Ben Bernanke and others applied will be ripped asunder as the economic tsunami continues its relentless and unforgiving advance globally.[4]

Hold on tight. It is apt to get very ugly. The euro zone will unravel, which is likely to be a relatively small but critical part of what will be happening worldwide; and financial turmoil will engulf the euro-zone nations. There will be nobody of consequence in charge economically or politically in the United States or other countries. And the human suffering and chaos will be unfathomable.[5] Throw military and national security issues into the mix, and the results may be explosive.

 

© 2010, Timothy D. Naegele

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[1] Timothy D. Naegele was counsel to the United States Senate’s Committee on Banking, Housing, and Urban Affairs, and chief of staff to Presidential Medal of Freedom and Congressional Gold Medal recipient and former U.S. Senator Edward W. Brooke (R-Mass).  He practices law in Washington, D.C. and Los Angeles with his firm, Timothy D. Naegele & Associates, which specializes in Banking and Financial Institutions Law, Internet Law, Litigation and other matters (see www.naegele.comand http://www.naegele.com/naegele_resume.html).  He has an undergraduate degree in economics from UCLA, as well as two law degrees from the School of Law (Boalt Hall), University of California, Berkeley, and from Georgetown University.  He is a member of the District of Columbia and California bars.  He served as a Captain in the U.S. Army, assigned to the Defense Intelligence Agency at the Pentagon, where he received the Joint Service Commendation Medal.  Mr. Naegele is an Independent politically; and he is listed in Who’s Who in America, Who’s Who in American Law, and Who’s Who in Finance and Business. He has written extensively over the years (see, e.g., http://www.naegele.com/whats_new.html#articles), and can be contacted directly at tdnaegele.associates@gmail.com

[2] See http://www.naegele.com/documents/CurrencyUnionTeeteringMr.EuroWasForcedtoAct.pdf; see also http://online.wsj.com/article/SB10001424052748703467004575464113605731560.html?mod=WSJ_hps_MIDDLETopStories

[3] See, e.g., https://naegeleblog.wordpress.com/2010/09/24/washington-is-sick-and-the-american-people-know-it/

[4] See also https://naegeleblog.wordpress.com/2010/09/09/are-afghanistan-iraq-and-pakistan-hopeless-and-is-the-spread-of-radical-islam-inevitable-and-is-barack-obama-finished-as-americas-president/ and https://naegeleblog.wordpress.com/2010/05/16/will-the-eus-collapse-push-the-world-deeper-into-the-great-depression-ii/

[5] See also https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/#comment-750 and https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/#comment-745

Are Afghanistan, Iraq And Pakistan Hopeless, And Is The Spread Of Radical Islam Inevitable, And Is Barack Obama Finished As America’s President?

By Timothy D. Naegele[1]

Arnaud de Borchgrave—editor at large of The Washington Times and of United Press International—has written another brilliant and very sobering article entitled, “Playing with fire,” which is worth reading and reflecting on.[2] In it, he states:

Unless [Gainesville, Florida Pastor Terry Jones, who decided to mark the ninth anniversary of 9/11 by proclaiming “International Burn a Koran Day,”] canceled his Koran book burning . . . , Christians throughout the world’s 1.2 billion-strong Muslim nations and Muslim communities would suddenly feel threatened. Those who converted from Islam to Christianity would be prime targets.

I will always remember the senseless killing of film director Theo van Gogh, who was the great-grandson of Theo van Gogh, the brother of the famous painter Vincent van Gogh.[3] I vehemently disagree with a burning of the Koran or the Bible.  However, is the Western world and culture going to be intimidated by and held hostage to the radical followers of Islam?  Is this “The Clash of Civilizations” that political scientist Samuel P. Huntington and former President Richard M. Nixon were concerned about?[4] Will Westerners be forced to subjugate their beliefs on the subject of Islam and Islamic terrorists, to the will of Islamic fanatics?  I think not.

Arnaud de Borchgrave adds:

Even if a superannuated preacher canceled the public burning of the Koran, the damage had already been done.

Yes, it would appear so.  Humpty Dumpty has fallen off the wall already.

Next, de Borchgrave notes:

NATO members pledged 2,796 trainers [to Afghanistan] but only 500 showed up. The NATO bureaucracy in Brussels couldn’t make it happen, according to one U.S. officer involved in the program. Most NATO countries are steadily reducing their defense budgets.

This is ominous.  Among other things, Germany’s “vaulted” military has been a paper tiger for years, in actuality.  Also, it seems that all of Europe will be weak, which might foretell America’s military future too—certainly if Obama were to get a second term in office, which is unlikely.

Lastly, de Borchgrave compares the collapse of the South Vietnamese army with that of the Afghan army, and describes the hopelessness of America’s Afghan adventure.  While there are certainly parallels between Vietnam and Afghanistan, the stakes are even higher now with a nuclearized Pakistan next door.

If Obama cuts and runs from Afghanistan, the war’s failure will be hung around his neck politically like Vietnam was hung around Lyndon Johnson’s neck.  It prevented Johnson from running for reelection in 1968; and the same thing might be true of Obama as the presidential election of 2012 approaches.  The foremost concern, however, is America’s position in the world and that of our military, which has been so brilliant in recent years.

Enormous amounts of money are being spent on the Afghan war—while the country’s GDP is a mere fraction of that amount—which seems absurd.  Also, there is no al Qaeda presence worth mentioning in Afghanistan today.  And even if the Taliban were to return to power, it is not likely to invite al Qaeda back to its former safe havens. After all, the Taliban lost Afghanistan because of al Qaeda and 9/11.  Thus, why should anyone care whether the Afghans’ future is led by men who feel more comfortable living in prior centuries?  The answers are complex but clear.

Afghan women and their supporters around the world care deeply.  Afghan women will suffer greatly if the Taliban return to power.  Americans and our NATO allies would become parties to the process of turning back the clock once again, and subjugating Afghan women and destroying their lives and any hopes for the future.  The plight of women in Afghanistan is something that America has been addressing, with the help of former First Lady Laura Bush and others.

Also, a Taliban takeover of Afghanistan would be another step in the process of spreading Islam beyond the region, and destabilizing Pakistan, thereby potentially unleashing its nuclear arsenal on the world (e.g., for terrorists to buy and sell weapons-grade materials, at the very least).

Some Americans argue that Iraq is hardly a U.S. geopolitical success story, because it cost America enormous monetary and human treasures to get rid of Saddam Hussein, who—it is argued—was our best defense against Iran; and that Baghdad today has less electricity, among other services.  I was against our Iraqi “adventure,” primarily because I believed Saddam had WMDs, which he would not hesitate to use against our military, just as he had used them against the Iranians and the Kurds.  Also, I believed we were “fronting” for Israel, and doing its dirty work, which some people (such as former UN Ambassador John Bolton) are arguing we should be doing right now vis-à-vis Iran, which is madness.

However, the “surge” worked, which George W. Bush, General David Petraeus and Senator John McCain championed; and at least Iraqis have a real chance to build a viable and stable democracy.  I agree with the Wall Street Journal’s assessment that was contained in an editorial prior to Barack Obama’s recent speech to the American people concerning Iraq:

The U.S. kept hundreds of thousands of troops in Germany for decades after World War II, and it still has tens of thousands in South Korea and Japan. It would be a tragedy if after seven years of sacrifice, the U.S. now failed to assist Iraqis as they try to build a federal, democratic state in an often hostile neighborhood.[5]

I agree too with the assessment that Iraq and Afghanistan together will probably be Obama’s undoing unless the American economy does it first.  They are all running neck and neck, but my betting is on the economy.  It will be sinking even farther during the balance of this decade, despite occasional “green shoots” appearing—which is similar to what happened during the last Great Depression.

The economy and the wars will be Barack Obama’s undoing, if something more tragic does not define his presidency (e.g., assassination, an EMP Attack), which I hope and pray never happens.[6]

© 2010, Timothy D. Naegele

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[1] Timothy D. Naegele was counsel to the United States Senate’s Committee on Banking, Housing, and Urban Affairs, and chief of staff to Presidential Medal of Freedom and Congressional Gold Medal recipient and former U.S. Senator Edward W. Brooke (R-Mass).  He practices law in Washington, D.C. and Los Angeles with his firm, Timothy D. Naegele & Associates, which specializes in Banking and Financial Institutions Law, Internet Law, Litigation and other matters (see www.naegele.com and http://www.naegele.com/naegele_resume.html).  He has an undergraduate degree in economics from UCLA, as well as two law degrees from the School of Law (Boalt Hall), University of California, Berkeley, and from Georgetown University.  He is a member of the District of Columbia and California bars.  He served as a Captain in the U.S. Army, assigned to the Defense Intelligence Agency at the Pentagon, where he received the Joint Service Commendation Medal.  Mr. Naegele is an Independent politically; and he is listed in Who’s Who in America, Who’s Who in American Law, and Who’s Who in Finance and Business. He has written extensively over the years (see, e.g., http://www.naegele.com/whats_new.html#articles), and can be contacted directly at tdnaegele.associates@gmail.com

[2] See http://www.upi.com/Top_News/Analysis/2010/09/08/Commentary-Playing-with-fire/UPI-32611283952855/

[3] See, e.g., http://en.wikipedia.org/wiki/Theo_van_Gogh_(film_director)#Assassination

[4] See, e.g., http://en.wikipedia.org/wiki/The_Clash_of_Civilizations

[5] See http://www.naegele.com/documents/ThePresidentonIraq-WSJ.com.pdf and https://naegeleblog.wordpress.com/2010/09/01/the-speech—is-barack-obama-smoking-pot-again/

[6] See also https://naegeleblog.wordpress.com/2010/01/20/the-end-of-barack-obama/ and https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/ and https://naegeleblog.wordpress.com/2010/01/01/barack-obama-america’s-second-emperor/ and https://naegeleblog.wordpress.com/2009/12/26/obama-in-afghanistan-doomed-from-the-start/ and https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/ and https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/