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Sowing Confusion about Fusion

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The Surrealist artist Salvador Dali, whom you may know best for his quirky mustache and his painting featuring melting clocks, once said:

What is important is to spread confusion, not eliminate it.

Apropos, when one thinks of Surrealism as a rebellious response to predictable and rigid political dogma up to and after World War I.

Trump has indulged in surrealism throughout the last six months in office, breaking expected and legislated norms of behavior. Some of this is a deliberate effort to effect change on our government; some of it is gaslighting, to force us to look at everything differently, suspiciously, to doubt ourselves.

And some of it is simply ass covering, hiding beneath a fog of bullshit.

On Saturday morning, Fearless Leader tweeted,

This looks like part of a new strategy, to appear as if he is not and has not been sympathetic and in sync with Russia’s Putin.

Such a strategy can explain the tenuous stance on Congress’ latest Russian sanctions bill. Trump hasn’t fully committed to signing the bill; as it was passed on July 25, the bill may be pocket vetoed depending on when Congress decides to go on August break. Trump dragged his feet for a week before signing the bill today with a whiny signing statement expressing concerns about the sanctions.*

But buried in that tweet is an effort to undermine the Steele dossier by replying on Fox News to attack the consulting firm which contracted the dossier’s production. Trump himself doesn’t mention Fusion GPS nor even the dossier, but relies on the narrative Fox pushes that morning to speak for him.

(NB: timing for future reference — Trumps’s July 29 tweet is at 7:07 a.m. EDT. Embedded Fox and Friends’ tweet is 4:15 a.m. EDT with a link to a July 27 story. That’s 2:07 p.m. and 11: 15 a.m. Moscow time, respectively.)

Fox News’ article discusses hedge fund manager Bill Browder’s testimony before the Senate Judiciary Committee in relation to the Foreign Agents Registration Act. He testified on July 26 about Sergei Magnitsky, Russia’s corruption, and the Magnitsky Act; in his written statement published the previous day as well as during his testimony (video), he shared that Fusion GPS had been contracted to work against the Magnitsky Act.

This is the point which is pushed by Fox, indirectly by Trump — that Fusion GPS worked for the Russians.

We’re meant to question Fusion’s agenda; we’re meant to believe the talking point sown about that Hillary Clinton and the Democrats were working with the Russians to undermine Donald Trump.

The poisoning of Fusion’s image doesn’t originate just from Trump or Fox News as quasi-state media.

The GOP jumped into this by posting a so-helpful page about Fusion on July 25 — the same day Browder’s written statement was published, days before Trump would make a veiled allusion to Fusion’s agenda.

Which should tell us not to put any faith in GOP members of Congress doing the right thing based on how deeply the party is committed to protecting Trump’s butt.

Although the GOP may also be protecting more than Trump by poisoning Fusion’s reputation. Fusion was originally hired to do opposition work on Trump — but they were hired to do so by a Jeb Bush supporter. Though the Democratic side of the presidential race eventually had interest in Fusion’s opposition research, the work began during the GOP primary race.

The trail to the funder(s) has been conveniently fuzzed. The BBC first reported Jeb Bush or his campaign hired Fusion, but a vigorous denial and a take-down demand changed reports to say that “unidentified Republicans” were responsible for employing Fusion to do anti-Trump opposition work.

The distancing continued with claims Hillary Clinton and/or the Clinton campaign hired Fusion, though it appears the truth is closer to “Democratic supporters” did so after Trump became the GOP’s presumptive nominee in spring 2016.

“Democratic supporters” doesn’t rule out anti-Trump members of the GOP who crossed the aisle and threw behind Clinton last year.

This may explain why the GOP has been working for some time on linking Fusion to Clinton so tightly — well before Browder’s testimony last week. The party is protecting someone(s) in their ranks from not only the Trump-Russia investigation, but Trump and Russia.

There was one other witness who testified before the Senate last week who spoke of Fusion GPS. It’s telling that Trump, Fox News, other right-wing media like the Weekly Standard, and the GOP have avoided mentioning this second witness.

Human Rights Foundation’s president Thor Halvorssen’s statement to the Senate Judiciary Committee outlined Fusion’s role in a Venezuelan corruption scandal. Fusion was hired to suppressed mainstream media reporting about investigations and court cases related to the scandal, which included money laundering through at least one major American investment bank.

Venezuela is and has been in a deep state of turmoil for several years; the corruption the U.S. hasn’t read about exacerbates Venezuela’s condition. Its political crisis has finally cracked the news here, and in part because of the Trump administration’s sanctions against its leadership and the amount of Venezuelan oil products the U.S. consumes. The rise in gasoline and oil prices over the last two months may be related in part to market volatility because of Venezuela’s crisis.

And while Venezuela may be sitting on a very large oil reserve, so is Russia and whomever now owns that 19.5% share of Russia’s largest oil company, Rosneft. The fortunes of GOP investors who own shares in or entire businesses related to oil production and processing also benefit from the increase in oil prices, profits from which may help fund the GOP and its candidates. It’s no wonder, then, the GOP and right-wing media focus on tying Fusion to Clinton and Russia in any way possible while avoiding Fusion’s work related to Venezuela.

So who does Fusion really work for?

As far as I can tell, any political entity with the money to hire their services. This is the best explanation for Fusion’s Glenn Simpson refusal to testify publicly before the Senate — they are competitive intelligence and media guns for hire, and asking them to disclose who hired them in public would damage their ability to contract freely with whomever approaches them, whether Republican, Democrat, or neither in the case of corporations.

There is one other point the Trump-GOP-Fox-right-wing media can’t adequately obscure, though they have done what they could to damage Fusion’s image.

Last summer, after gathering intelligence about Team Trump’s ties to Russia, the former MI6 officer was so concerned about his findings that he approached the FBI to share what he found.

It’s both strange and interesting that the Trump-GOP-Fox-right-wing media smear campaign against Fusion hasn’t mentioned this.

Surreal, one might say.

_________
* The sanctions bill was signed while I was in the middle of writing this. I can’t write fast enough to keep up with the crazy.

Three Things: Shocker, Badger, Vapor

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Summer doldrums are hitting hard here; it’s too steamy today to do much but watch the garden grow and the ‘hot takes’ bloom. Let’s breeze through these.

~ 1 ~

Shocker: The White House had its ass handed to it last night, alongside a serving of vanilla ice cream and peach cobbler. While it was kissing up to some über conservative Senators, Utah’s Mike Lee and Kansas’ Jerry Moran announced they would not support the Motion to Proceed on the latest POS edition of AHCA.

Excellent work on the dual tweets dispatched simultaneously at 8:30 p.m., by the way (see this one and this one). Live by the tweets, die by the tweets, Littlehands.

What I find particularly interesting is the secrecy this announcement revealed. Not just the discreet collaboration between two senators from very red states, taking advantage of the additional time afforded them by John McCain’s personal health care challenge. Apparently Senate Majority Leader Mitch “Yertle” McConnell has had such a tight grip on the legislative process that even his wingman, John Cornyn, doesn’t know what’s going on until McConnell’s office emails his deputies.

Not exactly a way to win friends and influence enemies, that.

(For some reason McConnell’s super-secret hyper control makes me think of the compartments Washington Post wrote about with regard to the Russian election hacks and the subsequent investigation. Why is that?)

~ 2 ~

Badger: Russia is pissed off about its dachas-away-from-home, threatening retaliation if they’re not returned. Uh, right. Like the U.S. suddenly decided to boot Russian occupants out of the Long Island and Maryland digs for no good reason last year. Russian Foreign Ministry “reserves the right to retaliate based on the principle of reciprocity,” forgetting that Obama took a too-measured response to repeated incursions by Russia into U.S. information systems — including hacks of the White House and Defense Department in 2015 — not to mention the ‘Illegals Program‘ spy who worked at Microsoft circa 2010. (Let’s also not forget an ‘Illegals Program’ spy worked their way close to Hillary Clinton’s 2008 campaign co-chair.) The U.S. could and should have been far more aggressive in its response; Russia isn’t entitled to reciprocity.

This is a test for Congressional Republicans. Either cement sanctions against Russia including the ‘foreclosure’ on these two compounds, or admit complicity in the undermining of democratic process last year. The GOP needs to revisit a CRS report on U.S.-Russia relations and Executive Orders 13660, 13661, and 13662 before they give any ground. [EDIT: See also EO 13964, issued April 1, 2016 in response to “malicious cyberactivity” — this EO the GOP will probably ignore just as it has all signs of Team Trump collusion as well as Russian interference in the 2016 general election.]

If there are truly compelling reasons in the nation’s interest for conceding these compounds, give them back — but only after the buildings have been razed and permits for reconstruction are denied under sanctions. The Russian government can work out of trailers on the property, or on boats from the dock. They do not need to be any more comfortable than they have been.

~ 3 ~

Vapor: No longer a ghost — we  now know who the eighth attendee was at Donnie Junior’s June 9th meeting at Trump Tower last year. Lucky number seven is believed to be a translator — and wow, so is number eight!

Which seems kind of odd — in the information Junior dumped online, there was no mention that Veselnitskaya didn’t speak English and needed a translator, or who would be the translator. Doesn’t it seem strange that there would be no concerns about security clearance into Trump Tower or a meeting with a presidential candidate’s son and/or campaign team given the meeting requester was a foreign national?

Perhaps because there was little concern, Body Number Eight, Ike Kaveladze, purportedly showed up as Veselnitskaya’s translator only to learn she had brought her own, Body Number Seven, Anatoli Samochornov. It’s not clear from USA Today’s reporting who asked Kaveladze to attend; did Junior just let any Russian in the neighborhood attend the meeting? Aras Agalarov sent Kaveladze “just to make sure it happened and to serve as an interpreter if necessary,” Kaveladze’s lawyer told NYT. Why so many witnesses?

The room must have been a little crowded with Junior, Jared Kushner, Paul Manafort, Rob Goldstone, Veselnitskaya and two translators as well as Rinat Akhmetshin.

Given the two translators, Akhmetshin’s presence seems even more curious. Why was he there if there were two translators?

~ ~ ~

That’s that. I could go on but it’s too damned hot here. Refresh your iced tea and settle yourself in front of the fan. This is an open thread — behave.

From Long Island and Maryland with Love

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Yet another Trump-Russia-related story dropped after regular business hours, this time in a holiday news dump zone. But after weeks of big stories dropping later in the day, we’re all conditioned to hold off our cocktails.

The Washington Post article had two tidbits I found interesting (Marcy tackles the anonymous letter at the root of the story). First, Russian Ambassador Kislyak’s reaction to Trump son-in-law and transition team member Jared Kushner’s proposal to establish a backchannel between Trump’s team and Russia.

Kislyak reportedly was taken aback by the suggestion of allowing an American to use Russian communications gear at its embassy or consulate — a proposal that would have carried security risks for Moscow as well as the Trump team.

Yeah. Not the first time Russia agents found American behavior sketchy. Recall the 2015 arrest of three Russian spies in New York? Evgeny Buryakov was really skeptical about his American contact’s insistence on casino business, and with good reason. Kislyak sounds just as skeptical about Kushner’s request in today’s WaPo piece.

And then this bit:

Russia would also have had reasons of its own to reject such an overture from Kushner. Doing so would require Moscow to expose its most sophisticated communications capabilities — which are likely housed in highly secure locations at diplomatic compounds — to an American.

Remember Obama’s last sanctions on Russia, ordered December 29? They included evicting two diplomatic compounds — one in Long Island, another in Maryland (back to this Maryland compound in a moment). What’s the chances these evictions were not only punitive but as a deterrent to their use for backchannel communications?

I’ve wondered for a while now about the communications methods Russian spies have used in the U.S., pondering about them in my post about 2015’s three-man spy ring. What might have been left behind after the last Obama administration sanctions?

Now back to Maryland and that storied Pioneer Point estate on the water, used by putative Russian diplomats as their dacha away from the hubbub of Washington D.C. It’s a lovely place, conveniently located near Annapolis, not an overly long drive from D.C., delightful waterfront for boating.

And only a hop-skip-jump across the Chesapeake Bay Bridge or a boat ride over the bay from Strategic Campaign Group (SCG) at 191 Main St #310, Annapolis — an address about a block from docks and waterfront restaurants. You may recall SCG was raided earlier this month in relation to reported conservative fundraising scams. Just so happens SCG has ties to Paul Manafort and to the Trump organization by former employee James Perry. At the time of the raid, the FBI said SCG was under investigation for fundraising related to a 2013 race.

I’m sure the proximity of SCG to the Russian’s Pioneer Point dacha is just a coincidence. But squirrel away the location for future reference.

Off to have the first holiday weekend cocktail — and no, it’s not a White Russian or a Moscow Mule. Have a good one!

UPDATE — 9:50 p.m. EDT —
Reuters dropped another one about a half-hour ago. Really, Jared? You can’t recall three additional contacts with Russian ambassador Kislyak? You’re really going to make Jamie Gorelick torch her reputation with this “dog ate my homework” prevarication? Are you really so clueless about communications collection? Because if you are, that’s as big a reason for your security clearance to be yanked as your lying has been. Somebody terminate his clearance immediately, please, whether he’s a target of the investigation or not.

I need another cocktail. Race you to the bar. If only we could make Jared buy us all a round.

Given Call for War, Pakistan’s Parliament Chose Peace. Will US Congress Ignore Call for Peace, Choose War?

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As Congress here in the US creeps ever closer to amassing a veto-proof margin for war with Iran by keeping sanctions in place even after a final P5+1 agreement would end them, it comes as especially refreshing that Pakistan’s Parliament has expressed clear sentiment against committing troops to a foreign exercise in folly. Especially remarkable is that this blunt refusal in the face of the Saudi request for Pakistani troops in Yemen comes only 13 months after the Saudis were found to have been the source of a critical $1.5 billion infusion of support when Pakistan’s economy was teetering.

Tim Craig gives us the essentials of Parliament’s move:

Pakistan’s parliament voted unanimously Friday to remain neutral in the conflict in Yemen, a major blow to Saudi Arabia as it seeks to build support for its offensive against the surging Houthi rebels there.

The parliament’s decision came after five days of debate in which lawmakers expressed major concern that Pakistan’s 550,000-man army could become entangled in an unwinnable conflict.

On Monday, Pakistan’s defense minister, Khawaja Muhammad Asif, said Saudi Arabia had requested that Pakistan send troops, warships and fighter jets to help it battle the Iranian-backed rebels in Yemen. But several Pakistani political leaders were strongly opposed to the request, saying the crisis in Yemen didn’t pose an immediate threat to Saudi Arabia.

The next paragraphs provide sharp contrast between the US Congress and Pakistan’s Parliament:

Instead, the resolution approved by Pakistan’s parliament warned that the Yemen crisis “could plunge the region into turmoil” if a negotiated peace and settlement was not reached soon.

“This bombing needs to be stopped because, as long as this is happening, the peace process can’t be launched,” Mohsin Khan Leghari, a Pakistani senator, said on the floor of parliament Friday.

A unanimous resolution against involvement in a foreign conflict that points out that Pakistan’s involvement “could plunge the region into turmoil”. Just wow. The US has sown turmoil on so many fronts throughout the Muslim world recently and yet Congress not only doesn’t see their own role in that turmoil but instead are doing their best to overcome the one opportunity we have there of establishing a peace process. I can’t think of a more damning indictment of Congress now than to put this move by Pakistan’s Parliament alongside Congress’ attempt to derail the Iran nuclear agreement. Given a call for war, Pakistan’s Parliament chose peace. Given a call for peace, the US Congress may still choose war.

For more details on the various forces at play in Yemen, this piece by Sophia Dingli at Juan Cole’s blog lays things out clearly.

The full text of the resolution can be found here.

Implementation of Interim Agreement With Iran Begins January 20, Paving Way for Further Negotiations

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Although the P5+1 interim agreement with Iran was first reached in late November, ongoing talks have been required to fill in the details of just how the agreement is to be implemented. Those talks came to fruition yesterday with the announcement that on January 20, the six month period of Iran making concessions on enrichment in return for limited sanctions relief will begin. The hope is that this period of pausing progress in Iran’s development of nuclear technology and the loosening of some sanctions will provide a window to negotiate a broader agreement that provides verifiable prevention of Iran producing nuclear weapons.

US Secretary of State John Kerry noted the significance of the latest negotiating progress:

We’ve taken a critical, significant step forward towards reaching a verifiable resolution that prevents Iran from obtaining a nuclear weapon.

On January 20, in just a few short days, we will begin implementation of the Joint Plan of Action that we and our partners agreed to with Iran in Geneva.

As of that day, for the first time in almost a decade, Iran’s nuclear program will not be able to advance, and parts of it will be rolled back, while we start negotiating a comprehensive agreement to address the international community’s concerns about Iran’s program.

Because of the determined and focused work of our diplomats and technical experts, we now have a set of technical understandings for how the parties will fulfill the commitments made at the negotiating table. These understandings outline how the first step agreement will be implemented and verified, as well as the timing of implementation of its provisions.

Iran will voluntarily take immediate and important steps between now and January 20 to halt the progress of its nuclear program. Iran will also continue to take steps throughout the six months to live up to its commitments, such as rendering the entire stockpile of its 20% enriched uranium unusable for further enrichment. As this agreement takes effect, we will be extraordinarily vigilant in our verification and monitoring of Iran’s actions, an effort that will be led by the International Atomic Energy Agency.

The United States and the rest of our P5+1 partners will also take steps, in response to Iran fulfilling its commitments, to begin providing some limited and targeted relief. The $4.2 billion in restricted Iranian assets that Iran will gain access to as part of the agreement will be released in regular installments throughout the six months. The final installment will not be available to Iran until the very last day.

That last bit is critical. While the war mongers will be crying about the US giving sanctions relief to Iran, that relief will be doled out over time and only provided as Iran continues to live up to its side of the agreement, with the final portion of funds only coming on the very last day of the six months. Central to this agreement, as previously reported, is that Iran will completely halt its enrichment to 20% uranium and, by the end of the six month period, will have no stockpile of 20% enriched uranium that is in a chemical form that could rapidly be enriched further to weapons grade.

Kerry appreciates that the six month period will provide a large window in which Congressional war mongers will be doing their best to disrupt the agreement:

We now have an obligation to give our diplomats and experts every chance to succeed in these difficult negotiations. I very much appreciate Congress’ critical role in imposing the sanctions that brought Iran to the table, but I feel just as strongly that now is not the time to impose additional sanctions that could threaten the entire negotiating process. Now is not the time for politics. Now is the time for statesmanship, for the good of our country, the region, and the world.

As I pointed out when Robert Menendez put together his bill for further sanctions, that particular bill goes far beyond a mere promise of further sanctions if a final agreement is not reached. Instead, it promises these sanctions even if a final agreement is reached that allows Iran to retain the right of enrichment of uranium below 5%. It has been clear to me from the start that Iran will insist on retaining the right to low level enrichment, and today’s Washington Post story on implementation of the agreement makes that point very strongly: Read more →

With Deal in Sight, Pressure Mounts on All Sides for P5+1, Iran

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Fars News reports that Iran’s Foreign Minister Mohammad Javad Zarif and Catherine Ashton, chief negotiator for the European Union, will meet for lunch tomorrow just before the next round of P5+1 talks with Iran kick off in Geneva later in the afternoon. But even though an interim agreement that would freeze Iran’s current nuclear work in return for a release of some impounded funds to Iran while a longer term agreement is finalized seems more likely than not, those who oppose any deal are desperately lashing out at the last minute. This morning, two bomb blasts near the Iranian embassy in Beirut killed more than twenty and injured well over a hundred. Israeli Prime Minister Benjamin Netanyahu has ramped up his rhetoric even further, making the outrageous claim that Iran has on hand sufficient uranium enriched to 5% to make up to five bombs within a few weeks of a “breakout”. Meanwhile, US President Barack Obama and Secretary of State John Kerry seem to have quelled for now any Congressional attempts to ratchet up sanctions ahead of this week’s negotiations, but should no agreement emerge this week, look for Washington politicians to race one another to see who can introduce the most severe new sanctions.

Although Beirut has seen several attacks back and forth recently with various Sunni and Shia groups attacking one another, the timing of today’s blasts suggest that the nuclear negotiations may be a target, as well. The Reuters article informs us that an al Qaeda group has claimed responsibility:

A Lebanese-based al Qaeda-linked group known as the Abdullah Azzam Brigades claimed responsibility for what it described as a double suicide attack on the Iranian mission in southern Beirut.

Lebanon has suffered a series of bomb attacks and clashes linked to the 2-1/2-year-old conflict in neighboring Syria.

Security camera footage showed a man in an explosives belt rushing towards the outer wall of the embassy before blowing himself up, Lebanese officials said. They said the second explosion was caused by a car bomb parked two buildings away from the compound.

But the Syrian information minister goes further, blaming Israel and Saudi Arabia for supporting the attack:

Syrian Information Minister Omran Zoabi implicitly blamed Saudi Arabia and Qatar for supporting radical militants, who have been accused for previous attacks against Shi’ite targets.

Just as they have been working together to arm and fund Sunni fighters for Syria, Israel and Saudi Arabia have joined together to fight against any agreements between the West and Iran on nuclear technology.

The pending deal on Iran’s nuclear technology has been described by Al-Monitor: Read more →

Navy Releases Cartoon of New Laser Weapon After Non-Productive P5+1 Talks

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Yesterday saw several developments in response to the P5+1 talks with Iran ending over the weekend with no new date announced for the next round of talks. AP launched into a discussion of Congress enacting even more sanctions against Iran, although considerable gyrations are needed to identify just what else we could possibly limit after already enacting new sanctions four times since 2010. There also was very little consideration of the damage already done to Iranian citizens. In addition, the video above appeared in articles yesterday for both Wired’s Danger Room and the New York Times announcing a new laser weapon. The laser is said to be able to shoot down drones and to pierce light watercraft, and so it will be deployed in the Persian Gulf. But not until 2014. Maybe that extra time will allow the US to make sure the Filipino Monkey can’t cause any mischief when the weapon is deployed. I’m guessing that the Times is onto something with their observation that the “Pentagon has a long history of grossly inflating claims for its experimental weapons”, especially since the Pentagon’s video, while over three and a half minutes long, has only about a minute and fifteen seconds of real-life footage, with the rest consisting of computer animation. Even Iran’s Fars News has read the accompanying report linked in the Times article where we learn of the limitation of laser weapons:

The laser does, however, have its drawbacks.

Testing has revealed it is disrupted by bad weather: Rain and clouds can scatter the beam, as can smoke, sand and dust.

In addition, due to the nature of the laser beam, these weapons are necessarily “line of sight” weapons, meaning they cannot attack targets that are beyond the horizon in the way that ballistic missiles can. Also, the report points out the issue of “blooming” where the laser beam heats up the surrounding air, making targeting difficult for an object coming straight at the weapon. A bit of what could well be that effect is seen in the live action video, where the path of the laser beam as it hits the target becomes visible just as the target is beginning to burn.

The release of an “official” video announcing the weapon, but relying so extensively on computer animation brings to mind the ridiculous cartoon that George Jahn published during previous discussions of the disputed Parchin complex and Benjamin Netanyahu’s bomb cartoon he used at the UN. When trying to convince the world of the effectiveness of a weapon of ours or the danger of a technology held by an adversary, reliance on cartoons does not instill a high degree of confidence in those who are evaluating the argument.

Today, Iran observed their National Day of Nuclear Technology which commemorates their announcement in 2006 of “completing the nuclear fuel production cycle at laboratory scale”. Iran discussed both the development of new radiomedicines and expansion of uranium mining, but Reuters found only the uranium mining to be worth mentioning. That’s okay, though. It’s not like there is a history of bad things going on when discussing yellowcake and foreign WMD. Oh. Wait.

Iran’s Economy on Its Knees: The West Built That

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[youtube]http://www.youtube.com/watch?v=XYu6aD0epO4[/youtube]

According to the New York Times, the video above has been verified as depicting the massive outpouring of Iranians to the streets yesterday to protest debilitating inflation rates and the free-fall of the Iranian rial. The impact of these economic developments on the Iranian people is devastating:

Iran’s freefalling currency is turning meat into a luxury, sparking overnight price surges and spurring shoppers to stockpile goods.

“Most of my customers just look at products behind the window and pass,” said Behrouz Madani, 42, who owns a butcher shop in northwest Tehran. “I see them going to the next store, which is a bakery, to feed their families with bread.”

The Bloomberg report goes on to describe the street protest that broke out in response to the pain felt by Iranians:

Iran’s rial is in a tailspin, having lost more than half of its value against the dollar in street trading in the past two months as U.S. and European sanctions aimed at curbing the country’s nuclear program bite. Riot police yesterday fired tear gas and sealed off parts of downtown Tehran after the currency’s plunge triggered street protests.

This graph (via Index Mundi) shows the number of Iranian rials needed to buy one US dollar over the past five years:

Iranian Rial to US Dollar Exchange Rate Graph - Oct 8, 2007 to Oct 3, 2012

But the graph only depicts the official rate set at Iran’s central bank. Note that the rial’s best value against the dollar is in early 2008, at just under 9000 rials to the dollar, but the graph hits an arbitrary straight line this year at just over 12,000 rials to the dollar for the official exchange rate. The unofficial street exchange rate has gone as high as three times that value this week. Going back to the Bloomberg article:

The currency dropped about 18 percent on Oct. 1, reaching 35,000 to the dollar on the unofficial market. The currency traded at 36,100 yesterday, the state-run Mehr news agency said, though traders in Tehran said most exchange houses have halted dealing in the greenback. That compares with the official value of 12,260 rials per dollar set by the central bank.

The primary cause for the devaluation of the rial is, of course, the sanctions put into place by Western nations to pressure Iran over its nuclear technology. From today’s Washington Post: Read more →

The Upside of Evidence-Free Nuke Accusations Against Iran? We Can Declare Victory!

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One would think that, within a month of the US finally withdrawing its troops (leaving behind a vast mercenary force) from the nearly nine year nightmare in Iraq that was launched on the basis of evidence-free accusations, and only days after President Obama signed into permanency his ability to detain citizens forever without providing a shred of evidence, the Washington Post would refrain from giving Joby Warrick a chance to yammer again from the basis of unsupportable allegations that Iran is actively pursuing nuclear weapons. But this is the Post we’re talking about, and the same bill that gave Obama indefinite detention powers also tightened the screws on Iran, so it was necessary to bring Warrick out to put forth the latest transcribed version of US spin.

Warrick’s piece, at the time of this writing, is occupying the most prominent position on the home page of the Post’s website, where it has the teaser headline “Iran fears worst as West steps up pressure”. Clicking through to the article gives the headline “As currency crisis and feud with West deepen, Iranians brace for war”. The overall spin that the US is projecting through this transcription is that both the Iranian government and Iranian citizens are feeling the almighty power of the US sanctions and that they are in a state of depressed resignation to the inevitability of war, while the US government is seeing that its brilliant moves are paying off and we just might not need to proceed to the point of an overt attack. I guess that is the upside of moving forward with public sanctions (and covert actions that already constitute a full-on war) based on manufactured evidence: it is also possible to manufacture evidence that allows us to declare victory and (hopefully) move on.

There is, of course, a flip side to that same argument. As commenter Dan succinctly put it in my post from yesterday where we were discussing the risk of all-out war stemming from the US sanctions:

All this risk to punish a country for something no one has proven it has done.

With that as background, here is how the Post article opens:

TEHRAN — At a time when U.S. officials are increasingly confident that economic and political pressure alone may succeed in curbing Iran’s nuclear ambitions, the mood here has turned bleak and belligerent as Iranians prepare grimly for a period of prolonged hardship and, they fear, war.

A bit further along, we get the US gloating on its “successful” approach:

The sense of impending confrontation is not shared in Washington and other Western capitals, where government officials and analysts expressed cautious satisfaction that their policies are working. Read more →

No Straight Talk, Only Posturing Between US, Iran on Strait of Hormuz

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[youtube]http://www.youtube.com/watch?v=z8yG5G2Kwt0[/youtube]

Iran’s threats to close the Strait of Hormuz are getting a lot of play in the press the past few days. As the ten days of naval war games for Iran that began on Saturday have continued, Iran’s bluster has gotten stronger, as have the US responses.

Ironically, Iran’s stated purpose when it began the war games included the desire to “convey a message of peace and friendship to regional countries” and yet, as can be seen in the video here, Iranian authorities are now saying that should their ability to export oil be curtailed through sanctions put in place by the US and European allies, they would close down the Strait of Hormuz, preventing exports by other countries in the region.

The impact of a real closure would be huge. Many of the numbers involved can be gleaned from this Bloomberg article published this morning. Iran’s oil exports amount to 3.6 million barrels a day, which means Iran only accounts for 23% of the 15.5 million barrels a day that pass through the Strait. It is believed that Saudi Arabia could produce an extra 2.5 million barrels a day in the event of sanctions halting Iran’s supply, and up to 200,000 more barrels a day could come from other countries in the region, so about 75% of Iran’s output probably could be replaced quickly.

However, with the Strait closed, the entire 15.5 million barrels a day could be disrupted. There is a pipeline being built by the United Arab Emirates that the Bloomberg article says will be ready “soon” and could bypass the Strait with 1.4 to 1.8 million barrels a day, but this would be only a very small fraction of the lost supply.

Even though such a closure would be seen as a direct response to the US and its European allies, the impact on China should not be overlooked. The CIA world factbook informs us that the US imports 10.3 million barrels a day and the EU imports 8.6 million, but China is next in line at 4.8 million barrels a day.  How would China respond to such a huge disruption of their supply, especially if it comes about through a series of disagreements where they have not been included in the discourse? Read more →