[R-G] How the Lobby Made Mincemeat of the Obama Administration

[Sid Shniad]

http://www.counterpunch.org/roberts11122009.html

CounterPunch                                November 12, 2009

*How the Lobby Made Mincemeat of the Obama Administration*

*America's Dismal Future*

By PAUL CRAIG ROBERTS

It did not take the Israel Lobby long to make mincemeat out of the Obama
administration's "no new settlements" position.  Israeli prime
minister Netanyahu is bragging about Israel's latest victory over the US
government as Israel continues to build illegal settlements on occupied
Palestinian land.

In May President Obama read the Israelis the riot act, telling the Israeli
government that he was serious about ending the Israeli conflict with the
Palestinians and that a lasting peace agreement required the Israeli
government to abandon all construction of new settlements in the occupied
West Bank.

On November 10 Obama's White House chief of staff, Rahm Israel Emanuel,
surrendered for his boss at the annual conference of the United Jewish
Communities. The ongoing Israeli settlements, he said, should not be a
"distraction" to a peace agreement.

Allegedly, the US is a superpower and Israel is a client state whose very
existence depends entirely on US military and economic aid and diplomatic
protection.  Yet, in the real world it works the other way.  Israel is the
superpower and the US is its client state.

This true fact is proved to us at least once every week and sometimes two
or three times in one week.    A few days ago the US House of
Representatives voted 344 to 36 in favor of disavowing the UN report by the
distinguished Jewish judge Richard Goldstone that found that Israel had
committed war crimes in its attack on the civilian population in the Gaza
Ghetto.  The Israel Lobby demanded that the House repudiate the fact-filled
report, and the servile House did as its master ordered.

US Rep. Dennis Kucinich spoke to his colleagues for 2 minutes in an effort
to make them see that their vote against the Goldstone report would be a
great embarrassment to the US government and demean the House in the eyes
of the world.  But none of that matters when Israel gives its servants an
order.  The US House of Representatives preferred to demean itself and to
embarrass the US Government rather than to cross the Israel Lobby.

Retribution quickly fell upon Kucinich for his 2 minute speech.  On
November 9, Kucinich was forced to withdraw as the keynote speaker for the
Palm Beach County (Florida) Democratic Party's annual fundraising dinner.
The Israel Lobby gave the order--dump Kucinich or there's no money and no
one is coming to the dinner.  County Commissioner Burt Aaronson called
Kucinich "an absolute horror."

Kucinich is the rare Democrat who stands up for his party's principles,
the working class,  and tried to get health care for those Americans the
corporations have thrown out on the street. But helping Americans doesn't
count.  Israel uber alles.

Meanwhile, the US dollar continues to decline relative to other traded
currencies.  Since spring, anyone could have made a double-digit rate of
return betting on most any currency against the US dollar.

The International Monetary Fund (IMF) recently expressed concern that
despite the dollar's continuing slide, it might still be over-valued.
The Federal Reserve's low interest rate policy encourages speculators to
use the dollar for the "carry trade."  Speculators, whether individuals
or financial institutions borrow dollars at rock bottom interest rates and
use the almost free capital to purchase higher yielding instruments in
other countries.  The demand for dollars to finance the "carry trade"
keeps the dollar higher than it would otherwise be.

Last year it was the Japanese Yen that was used for the "carry trade"
due to the practically zero Japanese interest rates. The next scare that
unwinds the "carry trade" will cause another big drop in financial
asset values.  This means that the stock market is very volatile.  It is
based on speculation, not on fundamentals.

When the "carry trade" next unwinds, the demand for US dollars to pay
off the loans will temporarily boost the dollar.  But don't be fooled.
The large US trade and budget deficits are the dollar's death warrant.

When the dollar finally goes, so will the government's ability to conduct
wars of aggression, underwrite Israel, finance its red ink and pay for
imports.  That's when the printing press will really get going.

Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan
administration. He is coauthor of The Tyranny of Good Intentions.He can be
reached at: PaulCraigRoberts at yahoo.com