Today’s News 28th July 2017

The Historical Turning-Point Has Arrived

Authored by Eric Zuesse via The Strategic Culture Foundation,

It affects both international relations, and America’s domestic policies…

We see it all around us.

Regarding international relations: On June 29^th, Politico bannered «House panel votes to force new debate on terror war», and reported that, «Congress may finally be getting fed up with war on autopilot. A powerful House committee voted unexpectedly Thursday to require Congress to debate and approve US military action in Iraq, Syria, Afghanistan and other far-flung countries».

On July 23^rd, the always-insightful Wayne Madsen at Strategic Culture Foundation headlined «The End of the ‘New American Century’ Pronounced by the Pentagon», and reported that, «The days of US-led dubious «coalitions of the willing» taking unilateral military action are over». He summarized an extremely important new study, which had been commissioned by the Obama Administration but was issued only recently (last month), titled «AT OUR OWN PERIL: DOD RISK ASSESSMENT IN A POST-PRIMACY WORLD», which calls for the US government to abandon unilateralism altogether, and to employ military power only in conjunction and cooperation — as equals — with a small circle of four historically long-term international allies (page 100) «the United Kingdom, Australia, Canada, and France are particularly active US global partners» on a global basis, but «the regional variety» of ally includes (in addition to those four) «Japan and the Republic of Korea in the Pacific, and Egypt, Saudi Arabia, Jordan, and Israel in the Middle East come to mind in this regard. Obviously, the North Atlantic Treaty Organization (NATO) Alliance is a clear example of a regionally-based entente as well».

In other words (page 103): «There is universal recognition as well that the United States and its defense establishment no longer exercise the degree of unchallenged strategic dominance enjoyed from the end of the Cold War through the immediate post-9/11 period». Bullying by America («regime-change») is, in so many words, said to be passé — not wrong, just no longer practicable (except, perhaps, when it has the participation of those ‘allies’, such as it did in Iraq, and in Libya, and — what are they really trying to say there — other than, perhaps, what they think the new President, Trump, might be wanting them to say?).

For such a document to be asserting that NATO — America’s oldest, largest, most formalized, and most clearly military, alliance — is of only «regional» military concern to the United States, comparable to the military concern that the US has regarding individual countries such as Jordan or Japan elsewhere, is a huge break away from prior US military thinking. It is certainly a repudiation of the Cold War conception of US military commitments and objectives. It upends them.

This is also (whatever it is) a repudiation of Barack Obama’s famously repeated assertions that all other nations except the US are «dispensable». In the imperial view, only the imperial nation is essential; all other nations are mere vassal-states, of subordinate (if any) concern. It was always the view that imperial nations held. It might even be said to define «imperialism». Typical from Obama was this — that imperial President’s most thorough statement of the imperial doctrine, on 28 May 2014, to graduating cadets at West Point, «Remarks by the President at the United States Military Academy Commencement Ceremony»:

Meanwhile, our economy remains the most dynamic on Earth; our businesses the most innovative. Each year, we grow more energy independent. From Europe to Asia, we are the hub of alliances unrivaled in the history of nations. America continues to attract striving immigrants. The values of our founding inspire leaders in parliaments and new movements in public squares around the globe. And when a typhoon hits the Philippines, or schoolgirls are kidnapped in Nigeria, or masked men occupy a building in Ukraine, it is America that the world looks to for help. (Applause.) So the United States is and remains the one indispensable nation. That has been true for the century passed and it will be true for the century to come.

But the world is changing with accelerating speed. This presents opportunity, but also new dangers. We know all too well, after 9/11, just how technology and globalization has put power once reserved for states in the hands of individuals, raising the capacity of terrorists to do harm. Russia’s aggression toward former Soviet states unnerves capitals in Europe, while China’s economic rise and military reach worries its neighbors. From Brazil to India, rising middle classes compete with us, and governments seek a greater say in global forums. And even as developing nations embrace democracy and market economies, 24-hour news and social media makes it impossible to ignore the continuation of sectarian conflicts and failing states and popular uprisings that might have received only passing notice a generation ago.

It will be your generation’s task to respond to this new world. The question we face, the question each of you will face, is not whether America will lead, but how we will lead.

He was telling America’s future military leaders that they would be waging wars for the only «indispensable nation», against the BRICS nations, where «rising middle classes compete with us» (Brazil, Russia, India, China, and South Africa), wars under the guise or cover of excuses such as «the values of our founding» and «to attract striving immigrants» and in instances such as when «masked men occupy a building in Ukraine» (whom his own Administration had actually hired to execute his coup to overthrow the then-existing Russia-friendly President of Ukraine by a rabidly anti-Russia fascist regime on Russia’s very border — but he didn’t mention any of that), etc.

When Obama’s agent who handled Ukraine told the US Ambassador in Ukraine, 23 days before the coup culminated, to appoint «Yats» to run that country after the coup would be completed, and she said there privately to that American Ambassador, «F—k the EU!» this was Obama’s unilateralism, in the raw, not fit for public consumption but far more real than his exquisitely deceitful public words ever were. (George W. Bush had lacked such PR skill, of which Obama was a master.) And, now, this landmark military study, which his Administration had commissioned, says: It’s over. That era is ended. The era which culminated with the regimes of George W. Bush and of Barack Obama, is now a proven disaster and must therefore be replaced. (That it’s a proven disaster is known to everyone except the propagandists — including ‘news’media — for America’s Establishment; but, that America’s military policy must be changed in accord with this recognition, is, until now, real news, to everyone.)

And, the evidence that the historical turning-point has arrived regarding also America’s domestic policies, was clearly shown and explained in my article «Obama US Economic Recovery was America’s Weakest»; and, it was additionally placed into the broader global economic perspective by the current Chief Economist for the World Bank, Paul Romer, when he delivered a now-historic address on 5 January 2016 titled «The Trouble With Macroeconomics», in which he documented that (the mostly US-created, but globally regnant) macroeconomic theory itself, is a lie, and is known privately among economists to be fraudulent, though they don’t say so in public. Bloomberg News bannered about that speech, on 18 November 2016, «The Rebel Economist Who Blew Up Macroeconomics», which reported that the lecture «landed among Romer’s peers like a grenade». Only outside of the world of professional economists does the fact that economic theory is fraudulent remain still unknown, or in any sense «news».

We are living in a new world, and don’t really know yet where it’s going. The only thing that’s clear is that the turning-point has been reached, and that we are there, right now. The turning-point is now. But where the US and the world are heading, can only barely be glimpsed. The latest landmarks, summarized here, might indicate the way forward.
The Globalist One World Currency Will Look A Lot Like Bitcoin

Authored by Brandon Smith via Alt-Market.com,

This week the International Monetary Fund shocked some economic analysts with an announcement that America was "no longer first in the world" as a major economic growth engine. This stinging assertion falls exactly in line with the narrative out of the latest G20 summit; that the U.S. is fading away leaving the door open for countries like Germany and China to join forces and fill the power void. I wrote about this rising relationship between these two nations as well as the ongoing controlled demolition of America's economy in my article 'The New World Order Will Begin With Germany And China'.

I find it interesting that the IMF is once again taking the lead on perpetuating the image of a failing U.S., just as they often push for the concept of a single global currency system to replace the dollar as the world reserve. The most common faulty counter-argument I run into when outlining the globalist agenda to supplant the dollar with the Special Drawing Rights basket system is that "the IMF is a U.S. government controlled organization that would never undermine U.S. authority." Obviously, the people who make this argument have been thoroughly duped.

The IMF is constantly and actively undermining America's economic position, because the IMF is NOT an American controlled organization; its loyalty is to globalism as an ideology as well as the international financiers that dominate central banking. America's supposed "veto power" within the IMF is incidental and meaningless — it has not stopped the IMF from chasing the replacement of the the dollar structure and forming the fiscal ties that stand as the root of what they sometimes call the "global economic reset."

To illustrate how the IMF narrative supports the globalist narrative, I suggest comparing the 2009 "predictions" of George Soros on China replacing the U.S. as the world's economic engine to the IMF's latest analysis on the decline of America.

The IMF cares only about centralizing everything, from currency to trade to governance. If the sacrifice of the old world system (the U.S. dollar) is required to create their new world system, then that is what they will do. If you have read my article 'The Federal Reserve Is A Saboteur — And The "Experts" Are Oblivious', then you understand that the Fed is also perfectly on board with this plan for a global reset. The central bankers, regardless of the nation they happen to reside, stick together and function as agents of larger controlling organisms like the Bank for International Settlements.

The agenda is not really veiled in secrecy, as it has been openly admitted to on numerous occasions by globalist media outlets. Mohamed El-Erian, former CEO of PIMCO, recently praised the concept of using the IMF SDR as a world currency mechanism and as a means to combat "the rise of populism." However, the most "honest" of these incidences of admission was, of course, the article Get Ready For The Phoenix published in the Rothschild controlled magazine The Economist in 1988; an article which announced the beginning of a new global currency mechanism using the SDR as a bridge starting in 2018.

I have noticed in the past month that there has been a concerted disinformation campaign on the internet attempting to debunk the article from The Economist by stating that it "never really existed" and is merely a product of conspiracy websites. So, I will put that claim to rest right now, permanently, by pointing out that magazine and research archives completely unrelated to "conspiracy theory" have the Phoenix issue on record. It is undeniable — the article was indeed published by The Economist and does in fact exist.

Moving on…

Critics of the notion of a single global monetary framework tend to dismiss any evidence of the plan, usually due to their poor understanding of how currencies rise and fall and a poor understanding of the current monetary climate. They will argue that the SDR basket does not have the capacity to replace the dollar and that there is no other mechanism in the world with the liquidity to do so. In other words, "Where is this global currency going to come from?"

The fact is, it already exists, and it is right under their noses.

When The Economist wrote about a global currency being launched in 2018, they perhaps did not have a precise inkling back then on how it would come about. They do mention clearly the strategy of using the IMF's SDR as a stepping stone to that global currency, calling it the "Phoenix," as an example. They also mention the decline of the U.S. as being necessary in the wake of this shift into complete centralization.

These two events are taking place right now, with the American economy in steady and ever steeper destabilization, as well as the rise of the SDR basket as a "stopgap" for nations seeking to decouple from the dollar as the world reserve. But what about the currency itself? The SDR might be the framework that will reign in various nations under one nefarious economic umbrella, allowing the IMF to dictate currency exchange rates at will until their one world system can be established, but what will the average person ultimately be using as a unit of trade and how will the globalists maintain monetary subjugation over the public?

Cryptocurrency and the creation of blockchain technology is the answer.

When The Economist wrote about a global currency being initiated in 2018, they were not making a prediction, but a proclamation — a self fulfilling prophecy. This does not mean that the new currency will develop in an obvious and open way. In reality, I can't think of very many 4th generation psy-ops as clever as cryptocurrencies.

Consider this; after 2007/2008, the weakness of globalism and economic interdependency is exposed for all the world to see. It is a sacrifice the international banks are willing to make, because through the credit and derivatives crash they can now enforce extreme monetary policies. These policies will do nothing to save the general economy, but they will jeopardize the very currency and debt frameworks of some nations, including the U.S. The stage is set for a new and even greater crisis, a crisis which will soften the public to the idea of a single world monetary system and a single economic authority.

The massive flow of data which the globalists covet as a means of "total information awareness" is a double-edged sword. Sovereignty and liberty activists grow in awareness and in number and influence. Millions begin preparing to weather the potential crisis being engineered by the globalists. Methods of counteracting an economic downturn or currency implosion are fielded. Activists start bartering and buying up precious metals as a shield, and as an alternative unit of trade. The alternative market, at least the core of it, is born.

What is a power hungry cabal to do? How do they stop the natural progression of the revolution against them? Well, they don't stop it; instead, they attempt to redirect it to work for them. That is to say, they trick the liberty movement into helping them while letting us think we are poking them in the eye.

Enter cryptocurrencies like bitcoin. Bitcoin arrives seemingly from nowhere, conjured by a magical crypto-wizard by the name of Satoshi Nakamoto, a label supposed to represent a person or group of people that no one has ever seen or heard from. We are simply meant to have faith that they don't work for the NSA or a similar entity. But who cares who they are, right!? It doesn't matter because bitcoin is such a work of art it is nearly infallible — the perfect countermeasure to a monetary world lorded over by the dollar and the Federal Reserve.

Numerous libertarians and anarchists collectively orgasm. They join what appears to be a grassroots effort to bring bitcoin and blockchain technology into the mainstream. They stop trading as many of their fed notes for gold and silver as before and buy digital nothings instead. To question the validity of the idea elicits dramatic displays of indignance from the bitcoin cult bordering on zealotry. The "smartest guys in the room" know bitcoin is the solution to everything — don't you want to be one of those guys, too? Bitcoin is the way, the truth, the life…

Some of us are unconvinced, and even rather suspicious, and with good reason. For example, the advancement of cryptocurrencies into mainstream consciousness has been helped expertly by the corporate media, which frankly, does not make sense if they are a real threat to the central banking monolith. As they say, when the real revolution happens, it will not be televised. Bitcoin is televised everywhere.

On top of this, nearly all major international banks are ingraining blockchain tech and cryptocurrencies into their business models, including globalist foundation banks like Goldman Sachs. Goldman Sachs LOVES blockchain technology; they even refer to it as the "new technology of trust." Just take a look at their rave reviews on how it will change the world here.

What is Goldman's favorite aspect of the blockchain and crypto? The fact that every single transaction is compiled, cataloged and tracked in the blockchain "ledger."

For years, one of the major original selling points of bitcoin was that it was "anonymous." It always surprised me that so many people in the liberty movement bought into this scam. Surely after the revelations exposed by Edward Snowden and organizations like Wikileaks, it is utterly foolish to believe that anything in the digital world is truly "anonymous." The feds have been proving there is no anonymity, even in bitcoin, for some time, as multiple arrests using bitcoin tracking have indeed occurred when the FBI decided it was in their interest. Meaning, when the feds want to track bitcoin transactions, they can, and it does not matter how well the people involved covered their actions.

The early promise of anonymity in cryptocurrencies was a lie.

Thus, we have the reason why central bankers and international financial conglomerates are piling into bitcoin like it's the hottest tech stock on the Nasdaq. Imagine a trade system in which every single transaction is compiled and nothing is private; that is the blockchain. Now, anonymity might not matter much when you are dealing with regular people, but what about when you are dealing with governments with the tendency towards corruption and the power to imprison and confiscate?

The loss of all privacy in trade IS the next quantum leap in monetary centralization, and cryptocurrencies achieve this in spectacular fashion. Not only this, but complete loss of privacy becomes rationalized, because without "transparency" the blockchain does not properly function. This is what makes the blockchain different from all other digital trade mechanisms – with the blockchain, surveillance of transactions is no longer a violation of privacy rights, it is expected.

While the fantasy is that crypto is about decentralization and freedom, it is actually a key to institutionalizing the opposite. I believe the incredible amount of capital being dumped into blockchain developments by major financiers and verbal support from central bankers is a signal that blockchain technology IS the basis for the currency system of the "new world order."

While there is something to be said for crypto and its potential to limit fiat money, I still remain skeptical. Mainly because anyone can create a cryptocurrency out of thin air. Just look at the confusion building over bitcoin vs. ethereum; which tulip is worth more, everyone wonders? Being that crypto is not tangible and is completely based on perceived value according to perceived demand rather than real demand, I think it is fair to argue that cryptocurrencies rely entirely on hype and fad in order to maintain market strength. Not that regular fiat currencies are any better, but isn't that the point?

So where does it end? If ethereum replaces bitcoin like Facebook replaced MySpace, how is stability in any digital currency provided? Through the force of government and the backing of international banks, obviously. And whichever cryptocurrency system the bankers choose to back or create, that currency will destroy the value of all other crypto around it. Again, perception, not tangible value, rules over bitcoin and its peers, and institutional power often rules over perception.

The proclamations of The Economist of a world currency launch by 2018 are happening today, right on schedule, right in front of us. The blockchain is going to "change the world;" this has been excitedly announced by the very same banking elites the blockchain was supposedly engineered to defeat. When the next reserve currency system is established using the SDR basket as a foundation, I have no doubt it will be digital and based on the same exact tech that today's activists wrongly assume will set them free.
Labor Disputes In China At All-Time-High

As Foxconn promises to bring 10s of thousands of jobs to Wisconsin amid billions of dollars of investment in new plants, one wonders what is going on in China that makes this economic (aside from the $3 billion ‘incentives’)…

Perhaps this…

Statista’s Isabel von Kessel writes that in 2016, the Ministry of Human Resources and Social Security (MOHRSS) in China registered 1.8 million labor disputes – an increase of almost 118 percent compared to the previous year.

You will find more statistics at Statista

Is this reason enough for local enterprises to outsource their production?

The Taiwanese electronics supplier for Apple, Foxconn, plans to open its first major factory in the U.S. President Trump, who is seeking to bolster domestic manufacturing welcomes this investment:

“This is a great day for American workers and manufacturing, and for everyone who believes in the concept and the label, ‘Made in the USA.’”

Foxconn however, has come under massive criticism in recent years with several labor disputes arising from the company’s working conditions.

In fact, labor disputes in general have become a major problem in China. One of the many reasons might be the insufficient mediation between employees and the management by the national All-China Federation of Trade Unions (ACFTU).

Authored by Samuel Westrop via The Gatestone Institute,

If it is ever "toxic" to deem ISIS a terrorist organization, then — regardless of whether that is the result of human bias or an under-developed algorithm — the potential for abuse, and for widespread censorship, will always exist. The problem lies with the very concept of the idea. Why does Silicon Valley believe it should decide what is valid speech and what is not?
Conservative news, it seems, is considered fake news. Liberals should oppose this dogma before their own news comes under attack. Again, the most serious problem with attempting to eliminate hate speech, fake news or terrorist content by censorship is not about the efficacy of the censorship; it is the very premise that is dangerous.
Under the guidance of faulty algorithms or prejudiced Silicon Valley programmers, when the New York Times starts to delete or automatically hide comments that criticize extremist clerics, or Facebook designates articles by anti-Islamist activists as "fake news," Islamists will prosper and moderate Muslims will suffer.

Google's latest project is an application called Perspective, which, as Wired reports, brings the tech company "a step closer to its goal of helping to foster troll-free discussion online, and filtering out the abusive comments that silence vulnerable voices." In other words, Google is teaching computers how to censor.

If Google's plans are not quite Orwellian enough for you, the practical results are rather more frightening. Released in February, Perspective's partners include the New York Times, the Guardian, Wikipedia and the Economist. Google, whose motto is "Do the Right Thing," is aiming its bowdlerism at public comment sections on newspaper websites, but the potential is far broader.

Perspective works by identifying the "toxicity level" of comments published online. Google states that Perspective will enable companies to "sort comments more effectively, or allow readers to more easily find relevant information." Perspective's demonstration website currently allows anyone to measure the "toxicity" of a word or phrase, according to its algorithm. What, then, constitutes a "toxic" comment?

The organization with which I work, the Middle East Forum, studies Islamism. We work to tackle the threat posed by both violent and non-violent Islamism, assisted by our Muslim allies. We believe that radical Islam is the problem and moderate Islam is the solution.

Perspective does not look fondly at our work:

Google's Perspective application, which is being used by major media outlets to identify the "toxicity level" of comments published online, has much potential for abuse and widespread censorship.

No reasonable person could claim this is hate speech.

But the problem does not just extend to opinions. Even factual statements are deemed to have a high rate of "toxicity." Google considers the statement "ISIS is a terrorist group" to have an 87% chance of being "perceived as toxic."

Or 92% "toxicity" for stating the publicly-declared objective of the terrorist group, Hamas:

Google is quick to remind us that we may disagree with the result. It explains that, "It's still early days and we will get a lot of things wrong." The Perspective website even offers a "Seem Wrong?" button to provide feedback.

These disclaimers, however, are very much beside the point. If it is ever "toxic" to deem ISIS a terrorist organization, then — regardless of whether that figure is the result of human bias or an under-developed algorithm — the potential for abuse, and for widespread censorship, will always exist.

The problem lies with the very concept of the idea. Why does Silicon Valley believe it should decide what is valid speech and what is not?

Google is not the only technology company enamored with censorship. In June, Facebook announced its own plans to use artificial intelligence to identify and remove "terrorist content." These measures can be easily circumvented by actual terrorists, and how long will it be before that same artificial intelligence is used to remove content that Facebook staff find to be politically objectionable?

In fact, in May 2016, the "news curators" at Facebook revealed that they were ordered to "suppress news stories of interest to conservative readers from the social network's influential 'trending' news section." And in December 2016, Facebook announced it was working to "address the issue of fake news and hoaxes" published by its users. The Washington Free Beacon later revealed that Facebook was working with a group named Media Matters on this issue. In one of its own pitches to donors, Media Matters declares its dedication to fighting "serial misinformers and right-wing propagandists." The leaked Media Matters document states it is working to ensure that "Internet and social media platforms, like Google and Facebook, will no longer uncritically and without consequence host and enrich fake news sites and propagandists." Media Matters also claims to be working with Google.

Conservative news, it seems, is considered fake news. Liberals should oppose this dogma before their own news comes under attack. Again, the most serious problem with attempting to eliminate hate speech, fake news or terrorist content by censorship is not about the efficacy of the censorship; it is the very premise that is dangerous.

Under the guidance of faulty algorithms or prejudiced Silicon Valley programmers, when the New York Times starts to delete or automatically hide comments that criticize extremist clerics, or Facebook designates articles by anti-Islamist activists as "fake news," Islamists will prosper and moderate Muslims will suffer.

Silicon Valley has, in fact, already proven itself incapable of supporting moderate Islam. Since 2008, the Silicon Valley Community Foundation (SVCF) has granted $330,524 to two Islamist organizations, the Council on American-Islamic Relations (CAIR) and Islamic Relief. Both these groups are designated terrorist organizations in the United Arab Emirates. SVCF is America's largest community foundation, with assets of over $8 billion. Its corporate partners include some of the country's biggest tech companies — its largest donation was $1.5 billion from Facebook founder Mark Zuckerberg. The SVCF is Silicon Valley.

In countries such as China, Silicon Valley has previously collaborated with the censors. At the very least, it did so because the laws of China forced it to comply. In the European Union, where freedom of expression is superseded by "the reputation and rights of others" and the criminalization of "hate speech" (even where there is no incitement to violence), Google was ordered to delete certain data from search results when a member of the public requests it, under Europe's "right to be forgotten" rules. Rightly, Google opposed the ruling, albeit unsuccessfully.

But in the United States, where freedom of speech enjoys protections found nowhere else in the world, Google and Facebook have not been forced to introduce censorship tools. They are not at the whim of paranoid despots or unthinking bureaucrats. Instead, Silicon Valley has volunteered to censor, and it has enlisted the help of politically partisan organizations to do so.

This kind of behavior sends a message. Earlier this year, Facebook agreed to send a team of staff to Pakistan, after the government asked both Facebook and Twitter to help put a stop to "blasphemous content" being published on the social media websites. In Pakistan, blasphemy is punishable by death.

Google, Facebook and the rest of Silicon Valley are private companies. They can do with their data mostly whatever they want. The world's reliance on their near-monopoly over the exchange of information and the provision of services on the internet, however, means that mass-censorship is the inevitable corollary of technology companies' efforts to regulate news and opinion.

At a time when Americans have little faith in the mass media, Silicon Valley is now veering in a direction that will evoke similar ire. If Americans did not trust the mass media before, what will they think once that same media is working with technology companies not just to report information Silicon Valley prefers, but to censor information it dislikes?

As Opioid Crisis Rages, Federal Drug Prosecutions Hit 25-Year Low

Members of the legal marijuana industry, who for months have been nervously anticipating a federal crackdown led by Attorney General Jeff Sessions, can breathe a sigh of relief. According to data from the Justice Department, the number of federal drug-crime prosecutions has fallen to its lowest level in 25 years, and the decline has continued to accelerate since President Donald Trump took office.

The latest data show that federal law-enforcement agencies prosecuted fewer drug offenders over the past 12 months than at any time during the last quarter century. During the first five months of the Trump administration, only 8,814 drug offenders were prosecuted by the federal government, a drop of 9 percent as compared with the 9,687 federal criminal cases prosecuted between February and June 2016.

Prosecutions fell sharply in June on a month-to-month basis following a spike in May. Over the long term, the six-month average has been declining slowly since 2003.

“During the month of June 2017, only 1,578 new prosecutions for drug crimes were brought – down 16.1 percent from the number in May. And prosecutions over the past year are even lower than they were five years ago. Overall, the data show that drug prosecutions in U.S. district courts are down 27.6 percent from levels reported in 2012.”

According to the report, most (75.8%) federal drug prosecutions involve trafficking charges, while another 21.8% are related to organized crime.

“So far during the first nine months of FY 2017, about 1 in 5 cases (21.8%) were the result of organized crime task force efforts. An additional three out of four (75.8%) fell under drug trafficking programs, while simple drug possession was the nature of the offense in the remaining 2.5 percent of cases.

The lead investigative agency for the largest number of prosecutions so far during FY 2017 was the Drug Enforcement Administration. It was the lead investigative agency in nearly four out every ten (38.9%) federal criminal prosecutions filed.”

If the decline continues at the current rate, the US is on track to see a sharp drop in the number of per-capita prosecutions in 2017.

“During FY 2016 the Justice Department said the government obtained 68.9 narcotics/drugs prosecutions for every one million people in the United States. If pace during the first nine months of FY 2017 continues at the same rate, narcotics/drugs prosecutions for one million people in the United States this year will be 65.3.”

While the long-term trend appears to ignore the worsening opioid epidemic, some of the largest year-over-year increases occurred in regions where opioid abuse has surged since the beginning of the decade. The Northern District of West Virginia, a state with the largest number of opioid prescriptions written per capita, saw the largest year-over-year increase. Over the past five years, Wyoming saw the largest increase n prosecutions, up 242%. The district with the largest projected drop in the rate of prosecutions was New Mexico, with 30%.

The most-active district is unsurprisingly situated along the US-Mexico border. The Southern District of California, which encompasses San Diego, saw 453.6 prosecutions per million people last year, while the District of Arizona ranked second.

Sessions has insisted that stepped up enforcement of drug laws is essential to combating the worsening opioid abuse crisis, but the decline But the decline in prosecutions suggests that law enforcement agencies have been somehow less active in targeting high-level drug offenders, even as overdose deaths rise to all-time highs thanks to powerful synthetic opioids that have penetrated the markets for heroin, cocaine and even prescription pills. Given the high stakes, and the actions against drug manufacturers recetly ataken by a nmber of states' attorneys general, the decline in prosecutions at the federal level makes little sense.
Senate Releases Full Text Of "Skinny" Obamacare Repeal Bill, Vote Expected After Midnight
With the Senate healthcare vote expected sometime between midnight and 2am, moments ago the full text of the Senate “Skinny” bill which may or may not pass, has been released. Here is the summary version of what is hereby known as the “The Health Care Freedom Act“:
- REPEAL THE INDIVIDUAL MANDATE — Obamacare’s individual mandate forced the American people to purchase insurance they frequently didn’t want, couldn’t afford or actually use. This plan permanently protects Americans from this onerous mandate.
- REPEAL THE EMPLOYER MANDATE — Obamacare’s employer mandate too often forced job creators to forgo hiring new workers or keep an employee’s hours low. This anti-jobs mandate is repealed for eight years, which provides employers a greater incentive to hire more employees.
- PROVIDE FLEXIBILITY TO STATES (1332 WAIVERS)— States can access additional flexibility to use waivers that exist in current law to provide more options for consumers to buy the health insurance they want. It also allows the Department of Health and Human Services to approve waivers faster.
- INCREASE HSA CONTRIBUTIONS — Increase contribution limits to tax-free Health Savings Accounts for three years to help pay for out-of-pocket health costs and expensive prescription medications.
- REPEAL THE MEDICAL DEVICE TAX — Both Democrats and Republicans have opposed this tax on medical innovation. The legislation repeals this tax for three years.
- FUND COMMUNITY HEALTH CENTERS — Prioritize health funding for Community Health Centers across the country.
The full bill also includes a provision for defunding Planned Parenthood, which is the reason for the community health center language.

As the NYT reports, after three days of debate, Republican leaders had little to show for it and were struggling to devise even a stripped-down plan on which at least 50 of the 52 Senate Republicans could agree. The Senate majority leader, Mitch McConnell of Kentucky, was doing whatever he could to secure votes and win Senate approval on Friday for a bill that would repeal at least a few provisions of the Affordable Care Act. That raised the spectacle of senators pressed by their leaders to vote on legislation that some of them despise, with a promise that a “yes” would not really be approval, just a vote to start House-Senate negotiations on something better.

Senators Lindsey Graham South Carolina, John McCain of Arizona and Ron Johnson of Wisconsin, all Republicans, simply demanded ironclad assurances from House leaders that the bill would not be enacted.

“I’m not going to vote for a bill that is terrible policy and horrible politics just because we have to get something done,” Mr. Graham said, calling the stripped-down bill a “disaster” and a “fraud” as a replacement for the health law.

Five GOP senators, Sens. Lindsey Graham (S.C.), David Perdue (Ga.), Ron Johnson (Wis.), Mike Rounds (S.D.) and Ted Cruz (Texas), spoke with Ryan via phone in Sen. John Cornyn’s leadership office outside of the Senate floor.

“Yes, he said, listen why would we want to own a bill that increases premiums and doesn’t fix ObamaCare — that’s all I wanted to hear from him,” Graham told reporters when asked if Ryan guaranteed the House wouldn’t pass a paired down Senate repeal bill.

Pressed if he would vote “yes” on the Senate GOP healthcare bill after his conversation with Ryan, Graham said he would. Johnson added that “of course” the talk with Ryan was enough to assuage his concerns. “We just wanted to hear it right from Paul. … We got that assurance. He said we could tell you — this is going to go to conference,” the conservative GOP senator said.

Johnson added that any bill that passes the Senate “will not pass the House. This will go to conference. … That’s what we got.” Johnson and Graham, as well as GOP Sens. Bill Cassidy (La.) and John McCain (Ariz.), warned earlier Thursday that they could not support moving forward with a “skinny” repeal bill until they got a guarantee that the House would not leapfrog a conference with Senate and pass the bill.

Paul issued a statement saying the House was “willing” to go to conference on the healthcare bills, but that it was up to Senate Republicans to first show they could pass a bill.

McCain told reporters while heading into the Senate chamber for a pair of votes that Ryan’s statement wasn’t sufficient. He then appeared to walk that back slightly, telling Bloomberg that he declined to say how he would vote, saying he wanted to talk to his state’s governor.

Earlier, Sen, Shelley Moore Capito told reporters while leaving the GOP caucus room that she “didn’t know how to interpret” Ryan’s statement.

Senate Majority Leader Mitch McConnell (R-Ky.) will need 50 of 52 GOP senators to support the “skinny” repeal proposal, which he unveiled on the Senate floor on Thursday night

Some further observations on the bill from Politico’s Burgess Everett (via Twitter):
- McConnell says the bill “restores freedom to Americans, that Obamacare took away.”
- McConnell is selling the skinny bill as good policy and also as a path to conference.
- This bill was not designed for Collins and Murkowski, so GOP looking for everyone that voted to open debate to support the skinny bill.
- Murphy: “This is nuclear grade bonkers what is happening here”
Some more from NBC’s Frank Thorp (via Twitter):
- Sen Rounds on mtg with @SpeakerRyan: “He acknowledged that this particular bill was designed to get us to conference…”
- More Rounds: “(@SpeakerRyan) said we will bring it to conference. And we asked, can we say that publicly, and he said, yes.”
- Sen Rounds: “(Speaker Ryan) has given us about as good of an assurance as you can get that he intends to send this to conference.”
- The vote series including the vote on the ‘skinny repeal’ bill is expected to happen around midnight tonight.
Having been written off earlier, it increasingly looks as if the bill may just have enough support to pass, with the tie-breaking vote from Mike Pence who is expected to be present for a potential vote later.

The full text of the pared-down “skinny bill” is below (link):
One Chart Shows The Awful Fiscal Trajectory Of Chicago Area And Illinois

Authored by Mark Glennon via WirePoints.com,

“Net position” is the government accounting term used for a balance sheet snapshot.

The chart shows net positions, in billions, for each of the last ten year ends, taken from the most recent CAFR, the Comprehensive Annual Financial Report, for Illinois, the City of Chicago (which are plotted on the right axis) and for Chicago’s two largest overlapping units of government, Cook County and the Chicago Public School District (which are plotted on the left).

Some of the drop in net position results from changes in pension assumptions and restatements resulting from changes in accounting standards. In particular, the drops from 2014 to 2015 are due largely to restatements based on new government accounting standards for pensions.

However, that doesn’t mean those losses should be disregarded. New assumptions and standards represent an admission that prior ones weren’t fairly representing financial condition.

Had the new standards been in place earlier, the losses would only have been pushed back into earlier years.

Aside from the terrifying trend, the chart also exposes the silliness of “balanced budget” claims.

All these units of government, to my knowledge, operated under budgets they claimed were balanced in each of these years (except the State of Illinois for 2016, during which it had no budget).

I asked Bill Bergman of Truth in Accounting for his reaction to the chart:

It’s fun, or sad and scary, or all of the above, to consider what this means for a citizen of the City of Chicago.

That person is not only a citizen of the City of Chicago, but is also impacted by the financials of the Chicago Public Schools, Cook County, and the State of Illinois.

Adding things up, back in 2007, he was being told that things were basically flat.

The latest aggregate net position came to over $250 billion — negative. That’s a lot of dough.

Importantly, he added, “The accounting changes aren’t over. We have yet to recognize retiree health care and other retirement benefits on the balance sheet, for example. We have a lot of ditch-digging ahead of us.”

Here’s a promise: The trend will continue. Recent tax increases will have little impact. Only drastic policy reversals, which aren’t in the cards with this General Assembly, would turn this around.
Wells Fargo Forced Unwanted Auto Insurance On 800,000 Borrowers

One year after Wells Fargo was busted in the biggest post-financial crisis scandal, when Warren Buffett’s favorite bank was exposed for fraudulently “cross-selling” bank products, including creating millions of credit cards and bank accounts to its customers that were never requested, and which cost the former CEO his job, Wells has just been busted yet again for another major scandal: the NYT’s Gretchen Morgenson writes that more than 800,000 people who took out car loans from Wells Fargo were also charged for auto insurance they did not need, and some are still paying for it, according to a 60-page internal report prepared by Oliver Wyman for Wells execs.

The report, which was prepared by the consulting firm Oliver Wyman, looked at insurance policies sold to Wells customers from January 2012 through July 2016. The insurance, which the bank required, was more expensive than auto insurance that customers often already had obtained on their own.

Wells Fargo automatically imposed the insurance through its Dealer Services unit. Its website says it has more than four million customers and provides a variety of banking services to 14,000 auto dealers around the nation. It says the company’s lender-placed auto insurance “may be considerably more expensive than insurance you can obtain on your own.” The NYT adds that “such policies typically cost more than $1,000 a year, not counting interest. (Customers could pay them in full or finance them over time.) If a car was repossessed, the bank might charge a reinstatement fee of as much as $500, so a borrower could face $1,500 in charges.”

It gets better: the expense on the unneeded insurance (which covered collision damage) has pushed some 274,000 Wells Fargo customers into delinquency and resulted in almost 25,000 wrongful vehicle repossessions. And the cherry on top: “among the Wells Fargo customers hurt by the practice were military service members on active duty.”

Not even bothering to lie, when asked about the revelations in the Wyman report, Wells officials confirmed that the improper insurance practices took place but said the bank was determined to make customers whole.

“We have a huge responsibility and fell short of our ideals for managing and providing oversight of the third-party vendor and our own operations,” Franklin R. Codel, the head of consumer lending at Wells Fargo, said in an interview. “We self-identified this issue, and we made the right business decisions to end the placement of the product.”

In other words, oops: we were busted for doing almost the exact same thing a year ago and we swore it would never happen again, but now that it has happened again, we will make everyone whole, promise.

National General Insurance underwrote the policies for Wells Fargo, which began to require the insurance on auto loans as early as 2006, according to the NYT. The practice continued until the end of September.

And here is the punchline in the upcoming congressional hearings where Elizabeth Warren will make sure more top-level execs will lost their jobs: for borrowers, delinquencies arose quickly because of the way the bank charged for the insurance. The NYT gives the following example:

Say, for example, that a customer agreed to a monthly payment of $275 in principal and interest on her car loan, and arranged for the amount to be deducted from her bank account automatically. If she were not advised about the insurance and it increased her monthly payment to, say, $325, her account could become overdrawn as soon as Wells Fargo added the coverage.

As a result, the report estimated that the bank owed $73 million to customers who were hurt as a result of this grossly fraudulent practice.

The laws broken by Wells in this latest fiasco were many but the most notable one is that state insurance regulations required Wells Fargo to notify customers of the insurance before it was imposed something the bank rarely did according to the report said. And almost 100,000 of the policies violated the disclosure requirements of five states — Arkansas, Michigan, Mississippi, Tennessee and Washington.

As for the reason why Wells stock will get pounded tomorrow, the report also found that borrowers sustained financial damages beyond the costs of the insurance. The harm also included repossession costs, late fees, charges for insufficient funds and damage to consumers’ credit reports. In other words, Wells has just opened itself to mass, and open-ended litigation which could run well into the billions.

The mechanics of the fraud:

Here is how the process worked: When customers financed cars with Wells Fargo, the buyers’ information would go to National General, which was supposed to check a database to see if the owner had insurance coverage. If not, the insurer would automatically impose coverage on the customers’ accounts, adding an extra layer of premiums and interest to their loans.

When customers who checked their bills saw the charges and notified Wells Fargo that they already had car insurance, the bank was supposed to cancel the insurance and credit the borrower with the amount that had been charged.

Iin some cases the bank did just that. In most cases, nobody noticed and the scheme continued: “The Oliver Wyman report indicated that many customers appear not to have notified Wells Fargo of the redundant insurance. This may have been because their payments were deducted automatically from their bank accounts and they did not spot the charges.”

According to documents on a Wells Fargo website titled “understanding your auto loan,” the bank had strict rules about the order in which it would apply a customer’s car payment to costs associated with the loan: First to be deducted from a payment would be the interest owed on the car loan. Then the bank would deduct interest charged on the lender-placed insurance. The third deduction would be principal on the loan, followed by the amount of premium owed on the insurance.

This payment structure had the effect of increasing the overall interest borrowers paid on their loans, the Oliver Wyman report noted, because fewer dollars went to reducing the principal outstanding.

“We take full responsibility for these errors and are deeply sorry for any harm we caused customers,” said Jennifer Temple, who then tried to non-GAAP the bank’s liability, saying the bank had determined only 570,000 of its customers may qualify for a refund and that just 60,000 customers in the five states had not received complete disclosures before the insurance placement. Finally, she said, the bank estimated the insurance may have contributed to 20,000 wrongful repossessions, not 25,000.

That “excuse” probably won’t go over too smoothly in Congress.
Companies Turn To Convicts To Fill "Skilled Labor Shortage"; Ignore 95 Million "Out Of Labor Force"

A lot of time has been spent of late discussing the apparent “labor shortage” in the U.S. economy. In fact, just this morning, the Wall Street Journal ran an alarming headline alleging that the market for “skilled labor” has become so tight that housing companies across the nation are having to recruit convicted felons in order to keep up with building demands.

Erickson Cos., a Chandler, Ariz., based construction firm, has hired almost 30 former inmates from Arizona state prisons over the past year to build frames for new homes, an effort to cope with skilled-labor scarcity.

“We’re searching for every alternative avenue that we possibly can to help solve this labor shortage,” Rich Gallagher, Erickson’s chief executive, said in an interview.

Erickson is part of what appears to be a nationwide trend. As the jobless rate falls, employers in places including Arizona, Indiana and Maryland are scouring the fringes of the labor market for able-bodied workers, including ex-offenders.

Erickson, which has about 250 employees in Arizona and roughly 1,000 nationwide, has been recruiting directly from corrections department job fairs for prisoners nearing release. Karen Hellman, director of inmate programs and re-entry, said there has been a noticeable uptick in companies looking to hire inmates this year.

“I’ve never dealt with employers who are more willing to hire ex-felons,” said John Nally, who started working at the Indiana Department of Correction in 1967 and is now its director of education. “It is a totally different landscape when you have an unemployment rate of 3.6%. We have all these people in construction who are literally begging for workers.”

And with more than 600,000 sentenced prisoners nationwide released from state or federal prisons each year, ex-cons do offer a steady, if somewhat risky, stream of potential applicants.

That said, we continue to be somewhat perplexed by the apparent ‘labor shortage’ plaguing the the U.S. economy. As Goldman’s econ team pointed out earlier today, the lack of wage growth among recent graduates seems to be somewhat inconsistent with an economy experiencing true labor shortages.

Of course, maybe that’s because there isn’t really a “labor shortage” at all, but rather, a massive skills gap resulting from decades of American youth being indoctrinated with the notion that focusing on obtaining a skills-based trade job, rather than going to college, was somehow demeaning, racist and/or misogynistic.

You know, because throwing 10’s of thousands of dollars at millions of high school kids who will use their taxpayer-subsidized student loans for hedonistic, binge-drinking spring break trips to Cancun, all while ‘earning’ a 1.5 GPA in anthropology from a state school and then returning to mom’s basement with no job after graduation, is just so much more enlightened and progressive.

Meanwhile, the cost of that progressivism is an economy that has ~95 million people who have voluntarily taken themselves out of the labor force, many because they simply don’t possess the right skills or are unwilling to take jobs that they’ve been convinced are ‘demeaning.’

Of course, for those who still aren’t convinced….perhaps you have another explanation for why over 30% of the ~75 million 18-34 year olds in this country (roughly 22.5 million people) are currently living at home with mom and dad?