Today’s News 28th January 2019

  • Scheer: The Illegal CIA Operation That Brought Us 9/11

    Authored by Robert Scheer via TruthDig.com,

    Was it conspiracy or idiocy that led to the failure of U.S. intelligence agencies to detect and prevent the Sept. 11, 2001, attacks on the World Trade Center and Pentagon headquarters? That’s one of the questions at the heart of “The Watchdogs Didn’t Bark: The CIA, NSA, and the Crimes of the War on Terror,” by John Duffy and Ray Nowosielski. In their careful and thorough investigation of the events leading up to the attacks, the authors uncover a story about the Central Intelligence Agency’s neglect, possible criminal activities and a cover-up that may have allowed al-Qaida to carry out its plans uninhibited by government officials.

    In the latest installment of “Scheer Intelligence,” the journalists tell Truthdig Editor in Chief Robert Scheer how an interview with Richard Clarke, the counterterror adviser to Presidents Bill Clinton and George W. Bush, led them to a jaw-dropping revelation regarding two hijackers involved in the infamous attacks. As it turns out, Khalid Muhammad Abdallah al-Mihdhar and Nawaf al-Hazmi, two men linked to al-Qaida, were staying at an FBI informant’s home in San Diego in 2000, and they were being tracked by the National Security Agency. Despite knowledge of the men’s ties to the terrorist organization responsible for 9/11, neither was investigated by the FBI. Clarke and others believe that this may have had to do with a CIA attempt to turn the two men into agency informants.

    “When we sat down with Clarke … he told us he couldn’t see any other explanation but that there was an op [and] that it never made it to the White House because it would have had to go through him,” says Nowosielski.

    “And his friend [then CIA Director] George Tenet was responsible for malfeasance and misfeasance in the runup to 9/11.”

    Once the plans for the 9/11 attack must have become clear to the CIA, why didn’t the agency prevent it from taking place? Duffy and Nowosielski come to the simple, shocking conclusion that because the CIA is prohibited from operating on U.S. soil, those involved in the operation chose to avoid prosecution rather than come clean.

    In a well-documented case study that touches senior government officials, including current special counsel Robert Mueller and other high-level individuals, crucial questions arise about who is responsible for allowing “a plot that resulted in 3,000 murders” and led to ongoing U.S. military entanglements in the Middle East to move forward.

    However, our country’s recent crimes and the people behind them, including President Bush, are currently being “whitewashed” by our national obsession with Donald Trump, the authors warn.

    “All the crimes of the war on terror, the torture, Abu Ghraib, it’s all just gone—the unnecessary invasion of the war in Iraq, it’s all just sort of under the rug now because of Trump,” Duffy says.

    Listen to their discussion to learn more about the stunning investigation into the tragedy that changed the course of our nation’s history and the Americans who could have thwarted the attacks but decided to cover their own backs instead. You can also read a transcript of the interview below the media player.

    RS: Hi, this is Robert Scheer with another edition of “Scheer Intelligence,” where the intelligence comes from my guests. And the title is really appropriate for the book we’re going to talk about today, “The Watchdogs Didn’t Bark: The CIA, NSA, and the Crimes of the War on Terror.” And the authors are John Duffy and Ray Nowosielski. And they are investigative reporters, and the watchdogs here are the people in our intelligence agencies that are supposed to be protecting the nation. And this book cuts very deeply into the unsolved mystery of how 9/11 happened. Why weren’t we better prepared to prevent it? It’s one of the most important events in American history; it certainly has shaped our lives in terms of a surveillance state, our rights and everything else, up to the present. And this book, I think, represents the most exhaustive and well-documented effort to get to the bottom of the whole thing. You’re very careful in what you do and do not assert about 9/11, what we don’t know about it, and particularly the role of George Tenet, who was then head of the CIA, and the role of the CIA in—what is the right word?—obscuring the story, even keeping information from the White House, from the FBI. So give me the gist of the book.

    RN: This is Ray. The book is largely about looking at this case study of the failure leading up to 9/11, the people who were involved in that failure, how that came about, and how they were successful, to the present day, in managing to obscure the public from really fully understanding that this was, in the words of one of our sources, really just a handful of people. And the most jarring thing is that they’re still, in some cases, working today in I guess Trump’s CIA. And we sort of document through the second half of the book what damage was done to America because they remained in their positions.

    JD: This is John. And intelligence was gathered around the time of the millennium that led people in the Bin Laden unit at the CIA to monitor a meeting in Malaysia that was a gathering of these al-Qaida figures. In monitoring this —

    RS: That was in the year 2000, right?

    JD: Yes. Right at the outset of the year. In monitoring this meeting, they became aware of the fact that one of the attendees had a multiple-entry visa to the United States. That man’s name was Khalid al-Mihdhar. He would eventually be on the plane that crashed into the Pentagon; he was one of the hijackers. So this starts the whole thing there, the fact that the CIA becomes aware of this information; the Bin Laden unit, counterterror center, and then all the way up to George Tenet are aware of this information. There’s a lot of ins, outs, and what-have-yous about where that information goes, but it ultimately does not go over to the FBI’s counterterror division in New York, much to the protest of the FBI agents who were detailed to the CIA’s Bin Laden unit. And it did not make it to the White House counterterror czar, Richard Clarke, who very much finds this to be, like, the crux of the whole story—the fact that this information was kept from his office for basically a year and eight months, up until the success of the attacks. The crux is there, that they had this information, these guys were coming into the country, they had just left the terror planning summit, and this information was being held close by the Bin Laden unit, by the counterterror center, and by George Tenet. The reason for that is unknown; the speculation that Richard Clarke has was that George Tenet and these people in the Bin Laden unit and counterterror center thought having these al-Qaida people in the United States, they could possibly go through Allied proxies in the Saudi intelligence to try to get close to these guys, monitor them, potentially find out information from them or even try to flip them. That’s Richard Clarke’s speculation as to why this was kept from him for so long. Ultimately, the attack was successful; that they all just did their best to bury all this and, you know, hope no one noticed.

    RS: Let me just start off with something that was confusing to me in reading your book. Because the FBI generally comes off looking pretty good in your book, and the real problem is with the CIA, and to a lesser degree, with the NSA. And in the San Diego story, and this is covered in the 9/11 Commission Report and others, the two San Diego guys—they are staying at the home of an FBI informant at first. So when you say the FBI was not informed, weren’t some of these calls actually made from the home of an FBI asset?

    RN: It’s interesting when you know, A, that according to our NSA sources they were able to be pinged every time that Mihdhar and Hazmi, the two hijackers, called from that house that you mentioned in San Diego, back to Yemen. That somebody in the NSA was getting an alert as that was happening each time, and was aware of those connections. But that the house that was being used for the phone call was that of an FBI informant, Abdussattar Shaikh. And Abdussattar was somebody the FBI recruited who was inside a popular mosque in San Diego, and who they thought might be able to feed them warnings of anybody who might be a radical Muslim terrorist. And Abdussattar claims that he simply missed the warning signs of the two tenants that he had in his home. I mean, it’s kind of interesting. He’s also, he’s not just an FBI informant, he’s also a Saudi, which kind of points to Richard Clarke’s conjecture, which he first laid out to us when we sat down in his office in 2009. And that was that once the CIA monitored the meeting in Malaysia, knew that these two guys were connected to Bin Laden and were of interest, and saw that they were heading to the United States, in Clarke’s words, they might well have thought that the best way to try to recruit these guys to feed information was not to send a blue-eyed, blonde-haired, American CIA agent to go to meet them. But, instead, to use our partners in Saudi Arabia and Saudi intelligence—which George Tenet, the head of the CIA, happened to be very close with—to try to recruit them. So I actually focus more on the fact that this guy was introduced to this house by a gentleman who’s been determined to be a Saudi agent, a guy named Omar al-Bayoumi, and that this guy then was perhaps working dually for Saudi intel and as an FBI asset. And everyone sort of focuses on, oh, Abdussattar Shaikh was an FBI asset, so that seems to put blame at the feet of the FBI. Could be; could be, but I would also focus on that Saudi angle, because it recurs so often.

    RS: Well, it also goes to the question of the efficiency of the surveillance society. Because after all, these phone calls could be intercepted. You know, they did; they could follow this trail. And phone calls are being made back to a suspect residence in Yemen and so forth, from the home of an FBI recruit. And I’m just wondering, there’s been a lot of discussion, some of the people that you quote in your book have made this point—you collect this haystack of information that doesn’t lead you to the needle in the haystack. And so here these phone calls were, clearly could be intercepted. They didn’t require any special act of Congress or anything else. This was not a case of their arms being tied, the intelligence agencies. But they’re not even looking at their own data. Isn’t that the takeaway from the first part of this story? These guys are acting suspiciously in San Diego, they have a suspicious background, they’ve participated in a suspicious conference, they’re staying at the home of an FBI informant, and they’re making calls that would basically outline what was going to happen in this disastrous attack—and no one noticed. Or the ones who noticed didn’t tell other people.

    JD: I think what is likely to have happened there is, so those calls were going back, and I think it was about seven or eight calls. And Khalid al-Mihdhar’s wife still lived at that house, and he was calling her from San Diego. So I don’t think any deep operational details were being discussed in those calls, but that doesn’t really matter; the fact that they’re calling that home from America is a big deal. And how that would work at the NSA is there’s someone who is tasked all day with basically monitoring the electronic signals going into and out of this house in Yemen, and when they see this coming in from the United States, that should ring a really big alarm bell. Now, that person working that desk would have to seek approval from the chop chain, which are these NSA managers. In order for anything to happen with that information, it has to get passed up and then brought to a FISA court, brought to the FBI. And if these managers within the NSA basically say, don’t worry about it, sit on it, just collect it, sit on it—and if they don’t allow any action, then there will be no action. And it’s just going to stay housed right there, in that particular data stovepipe at the NSA. If Richard Clarke’s speculation is true, that there was this attempt to recruit these guys in the U.S. with Saudi proxies, part of that plan would have been George Tenet speaking to someone at the NSA, or one of George Tenet’s people speaking to someone at the NSA. Basically saying, hey, before you go out getting any FISA warrants or chasing anything down regarding this specific house, come to us first. So if there is some operation going on, it would stand to reason that part of that operation would be not allowing these pings at this particular desk to turn into any action.

    RS: For people listening, let me make clear, this is an incredibly detailed, researched book, which relies very heavily on intelligence veterans. No one less so than Richard Clarke, who’s come up so far; another is former colonel Larry Wilkerson, obviously a key person. And what is very dramatic in your book is, where your story really comes to life for you guys as journalists, is when Richard Clarke—you say you go in there to interview him, and you tell your crew, put the sound on as we go in. And you go in, and you think you’re going to have to ask a lot of questions to get—and for people who don’t know, Richard Clarke ever since the early ’70s was a major figure in the intelligence community. And at this point, when you’re talking to him, he’s been around the block, he’s seen everything. And he was a close friend of George Tenet, who was head of the CIA; they considered themselves allies. And you’re going in to get this interview, and you think you’re going to have to weasel information out of him. And he just hits you over the head with an assertion that, really, is the thrust of this book. So why don’t you take us to that moment?

    RN: What we discovered on the day that we walked into Richard Clarke’s conference room was that he’d been ready for probably about a year to talk about this, and no major journalists had called him up to ask him about this subject. Nobody had ever asked him. So going back, you know, he started in the Reagan State Department; he worked under George H.W.; Clinton, when these Al Qaeda terrorist attacks began in the early nineties, recognized that there needed to be a new position within his Cabinet, and he called it the counterterror czar, the counterterror adviser. And he created that position for Richard Clarke. As you mentioned, Clarke was close friends with George Tenet, who also was sort of on the National Security Council under Clinton early on, and then got named the head of the CIA in the midst of Clinton’s first term. George W. Bush and company come in, early 2001; as it turned out, nine months ahead of this ticking clock towards 9/11. And Richard Clarke is told that he’s essentially being demoted. He’s still going to be the counterterror advisor, but it’s not a Cabinet-level position. And so now he’s kind of essentially going through the extra layer of Condoleezza Rice. But George Tenet still very much has Bush’s ear. And that’s kind of the back story there; then after, you know, on 9/11 Richard Clarke by nearly all accounts was running the response that morning, on that critical day; he was the top man for counterterror. Over time, he starts to get rubbed the wrong way by the fact that the Bush administration inexplicably is not really terribly still concerned about Al Qaeda after 9/11. But then Clarke leaves, and he writes a bestselling book. And he testifies before the 9/11 commission and becomes the only person to apologize to the families, to admit that there was a failure at all. But cut to a few years down the line, and he releases another book in 2008 that doesn’t become a bestseller. And it’s called “Your Government Failed You.” And it includes a section on Mihdhar and Hazmi that he calls “Straining Credulity,” in which he says that he does not believe in conspiracy theories, but in this one particular case, he’s weighed it every which way and he can’t see another way to explain it but by. But he sort of saved us speculation, and so we saw that part in his book and we thought, well, we’ve been itching—we’d collected enough info by that time, and talked with enough people, that we thought: something happened here with these two hijackers that flew over to the U.S. Something happened when they arrived. And the big question was, if this was an operation by the CIA, did they let Clinton know? Did they then let Bush know when he came in? What was the deal there? And Richard Clarke would be the man in a position to answer that. And so you’re right, that’s where our journey really—that’s where we launched. Because we’d been looking into it for a few years, but when we sat down with Clarke, that was when he told us he couldn’t see any other explanation but that there was an op, that it never made it to the White House because it would have had to go through him. And his friend George Tenet was responsible for malfeasance and misfeasance in the runup to 9/11.

    JD: And he also, in part of that description, said that a lot of the CIA reports that would have, any other day, come directly to his computer—when he flicked it on in the morning, it would be right there waiting for him—just on this specific case with these two individuals, he was removed from the chain of information. And so he felt that he was getting minutiae concerning terrorism from around the world in, like, tiny micro-detail on everything except this, and that must have meant he was intentionally pulled out of the chain by someone. And that that would have taken high-level order. And when asked, you know, how high level, he said that it must have come from the director, referring to George Tenet.

    RS: So let’s cut to the chase here. There’s an old caution, don’t attribute to conspiracy what can be explained by ordinary stupidity. Or laziness, or incompetence. Is this a case where George Tenet, the admired at that time head of the CIA, was just incompetent, stupid, indifferent? Is there something more at work? Did the CIA welcome such an attack as a boon for the military-industrial complex, as some people allege? What’s going on here? How could this major tragedy event be visited upon the United States, the head of our intelligence agency knows that there are these suspect characters there, and he doesn’t bother to tip off the FBI, let alone the White House? And after all, the FBI is in charge of domestic surveillance; they’re the ones that have to go arrest these guys, you know, at least confront them, see what they’re doing. I have to tell people listening to this, this is a very careful, indeed conservative, in the best sense of the word, book. This is not a book you can just dismiss by saying it’s got some wild, interesting theory. No—you err, I would say, on the side of caution, in a way.

    JD: We err on the side of caution all the time, and we’re not going to try to say something that we can’t really, really defend. If we start from a position that there’s some level of merit to what Clarke is suggesting, that there is this operation going on to try to monitor these hijackers domestically by the CIA, as opposed to handing it off to the FBI—presuming he’s right on that, there is this—

    RS: Can I just add a little note that Wilkerson actually goes further.

    JD: Wilkerson later suggests that he heard it mentioned after the fact, in about 2003 or 2004, when he is at the CIA. The invasion of Iraq has begun, and they’re waiting for updated satellite information, everyone’s kind of standing around just kind of BS’ing. And he basically overhears a conversation about how, oh man, Tenet tried to flip these guys in the U.S. and then had to hide it because it all went wrong, and it would have come back to bite him. And yeah, Wilkerson basically claims to have overheard high-level people speaking about that, just sort of in a B.S. session.

    RN: Well, and not really, not overheard; it’s more like, he claimed multiple, very high-level under Tenet sources, that he was close with at that time, who were in these “yak-yak sessions,” that he calls them. And they each claimed to be aware of the reality of this, supposedly.

    JD: You’re asking, like, how nefarious it is. In the first period of all this, presuming that it’s true, presuming that there’s this operation going on to try to flip these guys or follow them or whatever, gather information on them domestically, you can imagine that, OK, they’re going to have some sort of setup in which to monitor these guys, or they’re using Saudi proxies perhaps, or other proxies, and they’re following them. Then we get to this point where, well, the attack succeeds on September 11, so how the heck does that happen? If you have this, if you’re monitoring these guys and then they do this, where does the ball get dropped? And our book does go into that a bit, and we definitely say, like, there’s this moment where they must have said: OK. This isn’t working, it’s not happening, there has got to be a point where they say, abandon ship. But what do they do? How do they abandon ship? They need to somehow turn this over to the FBI to wrap it up for them. And the way they seem to do this is not by being honest and saying, hey, we were trying to do this and it didn’t work, but here’s the information—go get ‘em. They definitely don’t do that.

    RS: The “trying to do this”—you mean to turn these terrorists into agents for themselves?—

    JD: So what I’m saying is, if at some point when it’s not working, when the flip hasn’t happened, when whatever goal they set for themselves, when they haven’t achieved it, a time must come for them to wrap up this operation. A time must—you can’t just let them go all the way and succeed in their attack, you would think.

    RN: But I think what you’re asking is the intention of the operation, which would seem—well, the CIA was created in order to prevent future Pearl Harbors. So I guess, giving them the benefit of the doubt, the intention of the operation would theoretically have been to monitor these guys so as to figure out what they’re doing here in the U.S.

    JD: Yes, yes. We’re giving them the benefit of the doubt there. And then we look at the emails and cable traffic we can find in that summer, and we watch as—there’s no search for these guys, there’s no FBI search for these guys until August 23rd of 2001. And that’s the point where, surreptitiously, someone stationed at Alec Station, the Bin Laden unit, CIA, who’s going through old cable traffic, goes: Oh my gosh! I found a cable that these guys came to the United States. And she alerts the FBI, and the FBI begins their domestic search. I guess what I’m suggesting is, a time would have come when they, when whoever is running this operation at the CIA, whatever the architecture of that operation looks like, they would have seen these things happening. They would have seen the connections they were making with these other guys coming to the United States. And a time would have come for them to say: OK. We have to pass this off to the FBI to shut it down. And it does—

    RS: But wait a minute. When you say OK, and they’ve seen things—they see people who are identified as terrorists, part of this terrorist network, traces back to Al Qaeda. And they are learning about airplanes and how to fly them, and flight paths, and everything. And you’re telling me that they say, well, you know, maybe we’re not going to actually recruit them, maybe we’re—we better do something. Why aren’t they saying, holy cow, these guys can do great damage to this country! We got to call, what, the local San Diego police, at least, to get them to check them out! No?

    RN: OK, so these guys arrive in early 2000. What happens in October 2000? The U.S.S. Cole is attacked in Yemen. FBI agents working that from top levels of the New York office of the FBI find a very direct connection not only to Al Qaeda, but to that same planning meeting that the CIA monitored. The same one where Mihdhar and Hazmi were at that planning meeting. So not only do you have an inclination—oh, these guys are Al Qaeda, they’re probably not here to, in the words of one person, go to f’ing Disneyland. They’re here for something nefarious—but now, after October 2000, for the entire year up to 9/11, the CIA has the knowledge that these two individuals that were at this meeting, that the meeting spawned the U.S.S. Cole attack, which killed 17 dead servicemen. So I think at that point, yeah, calling the local San Diego police would probably make a lot of sense.

    RS: OK, and what about the FBI informant who was their link in San Diego? Why isn’t he telling anyone, or why doesn’t the FBI know?

    JD: You have to be careful to separate what’s going on at different agencies. An FBI informant’s not necessarily reporting to the CIA, and the CIA informant’s not reporting to the FBI. And then you also have to understand that the FBI has national headquarters and then a bunch of different field offices throughout the country. And you have field office reports coming in, like the Phoenix memo from Ken Williams mentioning that there’s these, all these Muslim guys trying to learn to fly. You’ve got what Coleen Rowley exposes out of Minnesota, when they bust Zacarias Moussaoui, and how they’re trying to get into his laptop, and they’re being hampered by FBI headquarters. So I mean, you don’t know what came from Abdussattar. But I don’t want to move too far into the weeds and off the general thrust of your original question. And I think what you come down to is a fork in the road. At some point, either the CIA running this operation has to wrap it up, or this major attack is going to succeed. If you ask yourself, well, why didn’t they wrap it up—because obviously they didn’t, and the attack did succeed–so if you ask yourself why didn’t they, there’s one potential answer, which is that they were afraid of being prosecuted. Because they had been running an illegal operation in the United States. So their own fear for their own lives, freedom, careers, all that stuff–

    RS: For people who don’t understand the law, you have to explain, the CIA was prevented from running this kind of operation domestically. This is supposed to be up to the FBI.

    JD: It is a crime for them to operate within the United States.

    RN: And what Richard Clarke told us, we don’t know how much of the information, like the Phoenix memo and these other things that Duffy just mentioned, got to George Tenet. But what we do know, the existence of Mihdhar and Hazmi in this country should have made it to him by that point. Because his own CIA counterterror office had informed the FBI in August, and a search had begun. So that information should have been in Tenet’s head. We know that he was briefed about Zacarias Moussaoui acting weird at a flight school in Minnesota. And he comes to the—oh, man —

    JD: September 4th principals meeting.

    RN: — September 4th principals meeting in the White House. Clarke has been pushing the entire Bush administration, the entire eight, nine months, to be able to brief them on Al Qaeda and make the case for why the administration should take this seriously. And he’s finally got that meeting, and George Tenet is sitting there, and he doesn’t say a word. And he was later asked by investigators why not, and he gave this really bizarre non-answer, which was just like: it just wasn’t the right time, right place, I just can’t take you any further than that. And they let him get away with leaving it at that, but Richard Clarke says the reason he doesn’t tell us at that point, he believes, is because Clarke would have had him brought up on charges that day for malfeasance and misfeasance in withholding that information. Because remember, that would also make his people culpable for the Cole, because they would have known about the planning session for the Cole nine months before that one happened, too. So it looks like —

    JD: And then they would have been guilty of obstruction of justice for all of the hiding of these figures once the FBI investigation into the Cole happened. So they have a long list of things they become guilty of should they just turn this over and say, like: Ah, hey guys, there’s these guys, you should probably go do something about it. Now, that’s one explanation. Other people have other explanations. But as I said, we don’t make accusations that we cannot really, firmly back up. So this time, that’s pretty much the one we typically go with.

    RS: Two people in your book who take it further are Richard Clarke and Larry Wilkerson. Two of the most highly experienced, knowledgeable individuals to come out of our whole military intelligence complex. And they, put it in human terms, they say they don’t know how these people sleep at night. Wilkerson, even more than Clarke, suggests that these people could have prevented 9/11, and knew about it. Now, I just want to ask you about one other person. Again, the book is devastating; it’s called “The Watchdogs Didn’t Bark: The CIA, NSA, and the Crimes of the War on Terror,” John Duffy and Ray Nowosielski. But let me push it one step further to the contemporary moment. The book is kind of easy on the FBI. But the fact is the FBI was really the agency that should have been following these terrorists when they’re in the United States. But one guy who comes up in current making of history, and who was head of the FBI at a critical point, is Mueller, who’s now running the Russian, interference in our election investigation. What was his role? I’d like to conclude on that, because he’s a major figure right now, the head of this special investigation. What was his role in this?

    RN: I mean, it is important to remember that the guy came in, I think it was maybe 10 days before 9/11, and took over the FBI. So he was, among the CIA, NSA, and FBI, he was able to be the only one at the leadership helm in the post-9/11 days and months who you couldn’t really lay any culpability at his door for any kind of failure. Remember, the CIA director George Tenet, he’s right at the table with the President; he’s a Cabinet-level guy. The FBI director, it’s not the same way. The FBI director reports to the Attorney General in the Department of Justice, and the Attorney General gets the direct seat. We make the case in the book that when George Tenet, in the week after 9/11, made the big play, the big power grab for the CIA, what we call the wish list of every CIA director accumulated over the whole history of the agency, and essentially puts it out there to Bush and says, these are the powers we need now to make sure this kind of thing doesn’t happen—he gets his green light. Mueller, on the other hand—well, a couple things happen. For one thing, the stories–the CIA is better at keeping their skeletons hidden, for a while. So the first stories that come out that start to paint a picture of blame regarding 9/11, they’re all pointing towards the FBI. Coleen Rowley comes out, and she points a finger at Mueller in May of 2002, and that sort of gets the ball rolling on the “it was the FBI’s fault” story, which really didn’t get corrected for quite a number of years. So our sources tell us Mueller was playing defense, he was willing to kind of go along as the Bush administration pushed that–we kind of know what happened here, so we don’t need to investigate this much further; you should be putting your FBI resources towards preventing future attacks. And I can certainly understand why a man like Robert Mueller in that position would say, would not want to be the guy that missed the next one. So from what we can tell, and from what our sources told us, it does seem that he sort of wrapped up the 9/11 investigation, or just ended it midway. But what was happening was, we talked with Pat DeMoro—he was one of our sources—and he took us inside, he ran the 9/11 criminal investigation; remember, this was a crime, right. At least 19 guys, probably a lot more, were involved in a plot that resulted in 3,000 murders. So he was investigating that, and he was finding over about a two-year period, there would be leads that would point towards Saudi facilitators to the hijackers, Saudi helpers, Saudi royal money coming over. And every time he found these, he had to report them up to Bob Mueller. Bob Mueller would theoretically report them to the Attorney General, who would theoretically report them to Bush. And yet the end result of this was that Bush invades Iraq, and the U.S. public never heard about these Saudi connections until, officially, until just a couple of years ago, really.

    JD: And you have said that our book comes off pretty light on the FBI, and I think the crucial difference to make clear is that most of the people we’re talking about within the FBI are from particularly one field office. We’re talking about John O’Neill’s people out of New York, who are counterterror investigators. That’s most of the people we’re dealing—we’re not, we mention a few other people from FBI headquarters, but we don’t necessarily mention them in the best light. And one of the big failures of the FBI is the search to find al-Mihdhar and al-Hazmi, once they are made aware that they’re in the country a couple weeks before 9/11. And that is a huge story there, and we could only write so much book. So we don’t want to just sit here and say, like, oh, the FBI is great and did everything right; we focus specifically on a handful of people who did do their damnedest to unearth the conspirators behind the Cole attack, and to pass information about the presence of al-Mihdhar and al-Hazmi over to FBI investigators in New York in the runup to 9/11. So we don’t want to necessarily sit here and say the FBI was perfect and did everything right; we’re talking about a handful of individuals.

    RS: And as you’ve just indicated, your style and the character of this book is quite scholarly. It’s very thoughtful, it’s incredibly well documented. And you got people really on the inside, in the know, to trust you and to talk honestly about it. You’ve done the gumshoe journalism, you took 10 years, you checked every record. What has been the critical response?

    RN: Well, we should have put Trump’s picture on the cover. [Laughs] I think that would have helped.

    RS: That’s a pretty profound observation, in a way. Because there’s a whole bunch of people now who think all of our troubles in this country started and will end with Trump. And it really whitewashes everybody else.

    JD: It’s whitewashing a lot of people. There’s, all of a sudden people who a few years ago we were like, this is the worst person on earth!—like George W. Bush, is now just being embraced by Democrats as some, like, affable guy. All the crimes of the war on terror, the torture, Abu-Ghraib, it’s all just gone—the unnecessary invasion of the war in Iraq, it’s all just sort of under the rug now because of Trump.

    RS: Yeah, those were the adults watching the store. Everybody is angry that Trump doesn’t have adults watching the store, and now he just got in trouble with his Secretary of Defense, pushing him out, and now that guy is whitewashed, right? He was considered a mad dog at one point. So you’re right; your book has run into a head storm of indifference to anything that happened before Trump. But I’m asking a very pointed question. What happens? You guys spent over 10 years on this, right?

    RN: Yeah. And you know, our goal was not to get famous. [Laughs] We really did want accountability for this small group of people that we thought, these people cannot stay in the CIA, right? We’re not going to keep letting them run the War on Terror, are we? And maybe if people just know about this, or if we can just prove it–if we talk with enough insiders, if we get enough documents together, if we write a book. It turns out, no. There’s going to be no accountability, and they’re going to, the few that remain now at high levels of the CIA are going to continue to do what they do, and no one’s going to know about it except for folks that listen to your show, so thank you.

    RS: Well, they’re going to write the history. I mean, the amazing thing–you think of a movie like “Zero Dark Thirty,” you know; and you quote John Kiriakou in your book, and he was in the CIA; he was actually very successful in being involved with the capture of the highest person connected with al-Qaida, and so forth. And they spun a myth that the torture worked, and you needed torture, and blah blah blah. And it basically went unchallenged. So these people who either lied, or just lied by not talking, even to the FBI or the White House—they get to control the narrative. And then a book like yours comes out, and—I’m asking a very serious question. What has been the response of The New York Times, The Washington Post?

    JD: [Laughing] We’re still waiting to hear what The Washington Post and The New York Times think. We’ve gotten a lot of praise from people who have read it, but we’re not getting any really major national or international reviews. Well, one thing we like to do, you mentioned “Zero Dark Thirty.” And the main character, played by Jessica Chastain, is sort of an amalgamation of a handful of people who did work at the CIA, most prominently a woman by the name of Alfreda Bikowsky, who is mentioned very prominently in our book. We want people to know her name, Alfreda Bikowsky, because it’s a name that was sort of an open secret in the media in, you know, New York, Washington, for many, many years. Her involvement goes from the pre-9/11 period there at Alec Station through torture and drone killings, and we want to make sure that her name gets out there so she can’t hide in the shadows.

    RN: Her name was never mentioned in any media until it came out on our website. It was 11 years, 10 months from the first alleged crime she’d committed that we documented, until her name came out on our website.

    JD: We just like to throw her name out there every once in a while, and make sure more and more people hear it.

    RS: Ah, that should be enough to inspire people to get a copy of “The Watchdogs Didn’t Bark: The CIA, NSA, and the Crimes of the War on Terror.” It’s written by John Duffy and Ray Nowosielski. It’s a very, very important book. This is the yeoman journalistic work on the story, and it’s informed by people on the inside who really witnessed it, and were shocked by what they saw, high-level people. So I recommend the book. I want to thank you guys for coming on. OK, that’s it for this edition of Scheer Intelligence. Our engineers at KCRW are Kat Yore and Mario Diaz. Our producers are Joshua Scheer and Isabel Carreon. I’m Robert Scheer, and we’re doing this broadcast from the University of Southern California Annenberg School for Communication and Journalism, where Sebastian Grubaugh, as he often does, has made the show work, and I want to thank him.

  • PBOC Fixes Yuan Dramatically Stronger Following Gold Spike

    PBOC fixed the yuan dramatically stronger against the dollar overnight, sending offshore yuan surging to its strongest against the dollar in six months.

    While the Chinese currency is reportedly strengthening on the heels of trade talks optimism (which is entirely the opposite of the rhetoric coming out of Washington), we note that this was the biggest positive shift in the yuan fix in 19 months…

    Notably, the yuan is strengthening considerably more against the dollar than it is against the broad basket of trade partner currencies…Shanghai Accord 2.0?

    And coincidentally, the surge in yuan comes the day after gold prices broke out higher…

    Perhaps the PBOC’s aggressive action was prompted to manage the Yuan peg against gold back into balance?

  • Stunning Footage Of Deadly Russian Strategic Bomber Crash Surfaces Online

    A horrific video of a Russian Tu-22M3 strategic bomber in Murmansk – a crash that left two of the fighter’s crew members dead and two badly injured – was caught on video.  And the footage has now emerged online.

    Highlighted by RT, the video shows the strategic bomber’s approach to an air base in near-zero visibility and the moment it slammed into the airstrip and burst into flames. The video was recorded by a Russian serviceman at the base, which is located near the city of Olenegorsk, and was recently leaked online.

    The video shows the heavy fog that was covering the area during the incident, which took place on Jan. 22.

    During the crash-landing, the bomber literally broke apart, with its cabin engulfed in flames while tumbling on the ground.

    The plane crashed during what the Russian Ministry of Defense said was a routine training mission. Though initially the ministry said there were no weapons aboard the jet at the time of the crash, later reports indicated that it had been armed with one Kh-22 long-range anti-ship missile and several hundred rounds aircraft cannon ammo. The bomber that was involved in the crash was built 33 years ago, but underwent an overhaul in 2012.

  • Trump Floated "Military Option" In Venezuela With Sen. Graham

    Military option on the table — that’s what Axios reporter Jonathan Swan was told when discussing the Venezuela crisis with Sen. Lindsey Graham. In a breaking exclusive Sunday evening, Axios has revealed key explosive contents of a recent meeting between President Trump and Sen. Graham wherein the president “mused to him about the possibility of using military force in Venezuela, where the U.S. government is currently pushing for regime change using diplomatic and economic pressures.” According to Axios

    Graham, recalling his conversation with Trump a couple weeks ago, said: “He [Trump] said, ‘What do you think about using military force?’ and I said, ‘Well, you need to go slow on that, that could be problematic.’ And he said, ‘Well, I’m surprised, you want to invade everybody.’

    Graham laughed. “And I said, ‘I don’t want to invade everybody, I only want to use the military when our national security interests are threatened.'”

    Sen. Graham explained further to Swan in a phone call that “Trump’s really hawkish” on Venezuela, and added the president’s willingness to use military force against the Maduro regime actually surpasses Graham’s.  

    Graham summarized the unusual and unexpected takeaway from the contents of his discussions with president with the conclusion that “Trump was even more hawkish than he [Graham] was on Venezuela.”

    This follows a week of unrest and mass protests, along with some very limited military defections, inside the socialist country and after about a dozen countries have joined the United States in recognizing opposition held National Assembly head Juan Guaido as the “Interim President of Venezuela” possessing sole legitimacy. After Trump’s controversial declaration of Maduro’s illegitimacy as president last week, a senior administration official followed by saying that “all options are on the table”.

    And now it appears the “military option” is perhaps more prominent on that table in Trump’s mind than many believed, which Axios muses is related to being “stymied at home” after the wall/government shutdown crisis, thus “Trump is now moving faster than ever on foreign policy.”

    While this doesn’t mean Trump will invade Venezuela anytime soon, it increasingly appears escalating diplomatic and economic pressures could fast put Washington on such a path toward overt regime change in Caracas. Toward this end, Axios notes: “We expect the Trump administration will target Nicolás Maduro’s oil and offshore wealth in the coming weeks and try to divert that wealth to the opposition leader, Juan Guaidó…”.

    The worry over potential military confrontation or civil war inside the country is increasingly looking very real as over the weekend reports surfaced online of a build-up of Venezuelan military assets along the borders, specifically near Columbia — a key US ally in Latin America.

    https://platform.twitter.com/widgets.js

    Since taking office, and prior to the current crisis as recently as 2017, Trump has spoken of a “military option” when Venezuela policy arises; however, his aides have reportedly attempted to dissuade him from taking any hasty action. 

    Meanwhile, according to Bloomberg, opposition leader Juan Guaido has called for consecutive days of nationwide protests to continue this week to put pressure on Maduro to hold a new election, in accord with EU demands that he announces fresh elections within eight days. Spanish Prime Minister Pedro Sanchez, issued the following ultimatum Saturday alongside France, Germany and Britain: “If within eight days there are no fair, free and transparent elections called in Venezuela, Spain will recognize Juan Guaido as Venezuelan president.” 

    Guaido last week specifically appealed to the military to switch sides following a local and short-lived attempt of 27 officers to lead a revolt on Monday (1/21). To encourage more such defections, which so far hasn’t appeared to penetrate the top layers of military leadership, Guaido has offered amnesty protection to any officer previously accused of corruption or human rights abuses should they defect. 

  • Japan Data Scandal: Tokyo Admits 40% Of Its Economic Data Is "Fake News"

    When it comes to the biggest monetary experiment in modern history, namely Japan’s QE which has seen the BOJ buy enough Japanese bonds to match the GDP of Japan, there is nothing more important than the BOJ having accurate metrics to determine if its “inflation targeting” is working, i.e., if wages and broader inflation are rising. Alas, the recent news that Japan’s labor ministry published erroneous statistics for years, has raised doubt about not only the accuracy of economic analysis released by the Bank of Japan, but prompted investors to doubt absolutely every economic report published by Tokyo.

    For those who are unfamiliar with the latest economic fake news scandal, on Wednesday Japan’s labor ministry revised its monthly labor survey for the period between 2012 and 2018 admitting it had overstated nominal year-on-year wage increases by as much as 0.7 percentage point between January and November of last year, to take just one example.

    Unfortunately, there are many other examples, and according to an Internal Affairs Ministry report released late Thursday, nearly half of Japan’s key economic government statistics need to be reviewed with 22 discrete statistics, or roughly 40% of the 56 key government economic releases, turning out to be “fake news” and in need to be corrected.

    This is a major problem for Kuroda and the Bank of Japan which uses statistics from the labor ministry to compile two key pieces of economic data, in making its ongoing decisions whether to continue, taper or expand QE.

    One, according to Nikkei, is the quarterly output gap which compares the nation’s supply capacity with total demand. Supply capacity is derived from elements such as labor and capital spending. Data from the labor ministry survey, such as the number of hours logged by the workforce, is used to compute the output gap.

    Japan’s output gap has climbed further and further into positive territory. That has partially informed the BOJ’s judgement that “Japan’s economy is expanding moderately.” The gap is also considered a leading indicator for inflation. A sustained positive reading could lead companies to raise prices and lift wages.

    Meanwhile, even as Japan’s consumer price index that excludes fresh foods continues to print below 1%, the BOJ has been stubbornly saying that prices are maintaining momentum toward its 2% inflation target, with the conclusion based in part on the output gap.

    In retrospect, it now appears that the BOJ may have been “mistaken” and since the underlying data was erroneous for all the years during which Japan’s QE was running, the BOJ will now face pressure to rework its entire framework and estimates in light of the data scandal.

    “With regard to the extent of the impact, we intend to undertake a careful examination based on upcoming results of government studies,” a BOJ spokesperson told Nikkei, offering a few other details.

    In addition to the output gap, the services producer price index, released monthly, is the second key BOJ indicator reliant on the labor survey. If the BOJ is forced to drastically revise either this indicator or the output gap, it could introduce uncertainty about the conclusions reached by the central bank which has bought trillions in government bonds and stock ETFs relying on… fake economic data!

    “There is no telling how far the impact has spread,” said a senior BOJ official, and for the BOJ to admit that economic data in Japan is now sheer chaos and that inflation had been overstated for years, is nothing short of catastrophic.

    Meanwhile, adding insult to injury, Japan’s latest scandal means that whereas everyone had long been making fun of China’s economic data for being manipulated, fabricated and goalseeked, Japan’s own “data” was far, far worse.

    In the BOJ’s quarterly Outlook for Economic Activity and Prices, at least eight out of roughly 60 diagrams incorporate data from the labor survey. Those include charts depicting individual income, nominal wages and consumer spending. The latest report, released Wednesday, amusingly describes a “steady improvement in the employment and income situation.” Alas, it turns out the improvement was only possible because the underlying data was wrong and/or “cooked.”

    The outlooks are considered valuable since they are based on the conclusions about the economy and prices reached by BOJ Gov. Kuroda. The central bank may see no need to revise earlier statements, but the reliability of the body risks being thrown into question regardless.

    Meanwhile, just to demonstrate how much of a circular farce “data” in developed countries has become, after Japan’s labor ministry admitted it published faulty wage data, 79% of respondents in a Nikkei poll taken between Friday and Sunday said they now can’t trust government statistics, while 14% said they can. And, making the farce complete, a separate poll found that the approval rating for PM Shinzo Abe rose 6% from last month to 53% in the Nikkei poll, with his disapproval rating falling 7%.

    We wonder how long before Japan admits that all of its polls showing support for the prime minister were just as fake.

  • This Week's Three Scenarios For US-China Trade Talks

    This week will mark another round of talks between the United States and China in an attempt to resolve the ongoing trade war, after President Donald Trump and China’s Xi Jinping ordered their officials to hammer out a deal by March 1 on “structural changes” to China’s economic model.

    Failure to reach an agreement will result in Trump raising the tariff rate on $200 billion in Chinese imports from 10 percent to 25 percent, and would “dash hopes of a lasting truce that would remove one of the darkest clouds hanging over the world economy,” reports Bloomberg

    Starting Wednesday, US Trade Representative Robert Lightnizer will meet with Vice Premier Liu He in Washington for two days, building on negotiations ranging from soy beans to subsidies Beijing provides to various state-owned companies. 

    And while a final deal isn’t likely this week, negotiators will hopefully produce a package of proposals to bring back to both administrations, said former Clinton Commerce official William Reinsch. 

    “Everybody’s divided, because President Trump is so unpredictable,” said Reinsch.

    “It’s probably 50-50 whether he’ll accept it.”

    Here are the good, the bad and the ugly scenarios according to Bloomberg

    ***

    Base Case

    Even if Lighthizer and Liu reach an agreement this week, it will probably take time to brief the two presidents, then for Trump and Xi to decide if they’re satisfied. Don’t expect much in the way of explanation from either Liu or Lighthizer, who rarely say much to the packs of reporters staking out the talks.

    That leaves vague official statements as the best way to determine how much progress was made. Following the last meetings in Beijing, the two sides put out separate statements. The U.S. acknowledged progress on issues such as purchases of U.S. products, but added that any deal would need to include “ongoing verification and effective enforcement.” The Chinese has called the talks “extensive, in-depth and detailed.”

    The broad outlines of a deal are clear at this point. The Chinese will probably agree to buy more American goods, Beijing may promise to stop stealing intellectual property, and the two sides could develop a workable enforcement system to give the deal teeth.

    If officials indicate that they plan to hold another round of talks, that would be a sign that the two sides still think a deal can be done before March 1, even if they’re not willing to lay out the whole package. Another possible outcome if the sides agree to meet again, would be for an extension to the tariff truce.

    “The easier things for trade negotiators to announce are procedural things,” said Jennifer Hillman, a law professor and trade expert at Georgetown University in Washington.

    “We’re going to meet, we’re going to talk. If you can’t agree on that, you’re in bad shape.”

    Breakthrough Case

    In the best-case scenario, the Chinese come to the table with an offer on economic reforms that’s more ambitious than expected. That convinces Lighthizer, a China hawk who has said progress with Beijing will take years, that the Chinese are serious about opening up their state-driven model. That could be enough for Trump or the White House to hail a deal in principle. Markets would rally, shrugging off months of anxiety about a global trade war.

    The problem is the Chinese would need a game-changing offer that shows they’re serious about loosening the grip of the state on the world’s second-biggest economy.

    “The U.S. wants broad changes to China’s corporate governance,” said David Loevinger, a former Treasury official who is now a managing director at TCW Group Inc. “It’s just very hard to do.”

    Breakdown Case

    If there’s no statement of any kind at the conclusion of talks, look out. A fiery Trump tweet may not be far behind, expressing frustration with the lack of progress.

    Trump has walked away before. In May, the two countries issued a joint statement in which China agreed to increase of farm goods and energy exports, and it recognized the importance of intellectual property protections. Within days, the president rejected the framework and sent his negotiators back to the drawing board.

    A similar reaction by Trump could put the talks on ice for a long time. Much will depend on how hawks in his administration — including Lighthizer, White House adviser Peter Navarro and Commerce Secretary Wilbur Ross — react to China’s offers.

    “What worries me is that over the course of the last year the balance of power has shifted toward the China hawks,” said Loevinger. “It’s still not clear what will take the U.S. to say yes.”

    If they don’t, it could be a long time before the next campaign of shuttle diplomacy between Washington and Beijing.

  • Hillary Clinton Reportedly Weighing Third Presidential Bid

    It looks like the Wall Street Journal – or rather, two Clinton world politicos who published an op-ed on the subject late last year – had it right: Hillary Clinton is seriously considering a third bid for president, according to CNN political correspondent Jeff Zeleny.

    Clinton

    Clinton is reportedly telling friends and associates that she “hasn’t closed the doors on a third presidential bid” after losing the 2008 Democratic primary to Barack Obama and then the 2016 presidential election to President Trump in one of the most spectacular upsets in the history of US politics.

    Hillary Clinton may not be ready to give up on her Oval Office dreams, CNN’s Jeff Zeleny reports.

    “Clinton is telling people that she’s not closing the doors to the idea of running in 2020,” Zeleny said. “I’m told by three people that as recently as this week, she was telling people that look, given all this news from the indictments, particularly the Roger Stone indictment, she talked to several people, saying ‘look, I’m not closing the doors to this.'”

    Of course, this doesn’t mean that there’s a “campaign-in-waiting” for Clinton, but it appears some low-level work is already being done to refurbish the Clinton machine.

    Still, Zeleny said, “it does not mean that there’s a campaign-in-waiting, or a plan in the works.” And one close Clinton friend told Zeleny “it would surprise me greatly if she actually did it.”

    Lest anybody think Clinton’s delusions of fulfilling what has been a life-long dream for the former first lady are unusual, CNN pointed out that actually many losing presidential candidates never truly rule out another run (take John McCain – or Richard Nixon – for example).

    Most losing presidential candidates never totally close the doors to running for president” again, Zeleny said. “But I think we have to at least leave our mind open to the possibility that she is still talking about it. She wants to take on Trump. Could she win a Democratic primary to do it? I don’t know the answer to that.”

    And while her numbers are well below those of Joe Biden and Bernie Sanders, she still outperformed many of her would-be primary rivals in the first polling for the Iowa caucuses.

    She’s already polling ahead of Elizabeth Warren and Kirsten Gillibrand, and is only one spot below Kamala Harris.

    Clinton

    All of this suggests that SNL was correct when it joked that Clinton would continue running for president until she either dies or finally wins.

  • The Fall Of Facebook Has Only Just Begun

    Via 13D Research,

    The fall of Facebook has only begun. The platform is broken and neither human nor machine can fix it.

    Even after losing roughly a third of its market cap, it still may prove one of the great shorts of all time.

    “There’s no mental health support. The suicide rate is extremely high,” one of the directors of the documentary, “The Cleaners” told CBS News last May. The film is an investigative look at the life of Facebook moderators in the Philippines. Throughout his 2018 apology tour, Mark Zuckerberg regularly referenced the staff of moderators the company had hired as one of two key solutions — along with AI — to the platform’s content evils. What he failed to disclose is that the majority of that army is subcontractors employed in the developing world.

    For as long as ten hours a day, viewing as many as 25,000 images or videos per day, these low-paid workers are buried in the world’s horrors — hate speech, child pornography, rape, murder, torture, beheadings, and on and on. They are not experts in the subject matter or region they police. They rely on “guidelines” provided by Facebook — “dozens of unorganised PowerPoint presentations and Excel spreadsheets with bureaucratic titles like ‘Western Balkans Hate Orgs and Figures’ and ‘Credible Violence: Implementation standards’,” as The New York Times reported last fall. The rules are not even written in the languages the moderators speak, so many rely on Google Translate. As a recent op-ed by John Naughton in The Guardian declares bluntly in its headline, “Facebook’s burnt-out moderators are proof that it is broken.”

    As we noted in last week’s issue, 41 of the 53 analysts tracked by Bloombergcurrently list Facebook as a buy, with “the average price target… $187, which implies upside of nearly 36%.” That optimism springs from a basic assumption: the company’s monopolistic data dominance means it can continue extracting more from advertisers even if controversy after controversy continues to sap its user growth. Given the depth and intractability of Facebook’s problems, this is at best short-sighted.

    The platform’s content ecosystem is too poisoned for human or machine moderators to cleanse. Users are fleeing in droves, especially in the company’s most valuable markets. Ad buyers are already shifting dollars to competitors’ platforms. Governments are stepping up to dramatically hinder Facebook’s data-collection capabilities, with Germany just this week banning third-party data sharing. The company is under investigation by the FTC, the Justice Department, the SEC, the FBI, and several government agencies in Europe. It has been accused by the U.N. of playing a “determining role” in Myanmar’s genocide. An executive exodus is underway at the company. And we believe, sooner or later, Facebook’s board will see no option but to remove Sheryl Sandberg and Mark Zuckerberg.

    The market is drastically underestimating the peril the company is in. In the very short term, the user backlash may simply hinder its revenue growth. In the longer-term, however, the institutionalized failure to see and respond to the platform’s downsides may render Facebook the Digital Age’s Enron — a canonized example of how greed and corruption can fell even the mightiest.

    According to data recently released by Statcounter, Facebook’s global social media market share dropped from 75.5% in December 2017 to 66.3% in December 2018. The biggest drop was in the U.S., from 76% to 52%. As Cowen survey results released this week suggest, these engagement declines will continue to depress the company’s earnings. Surveying 50 senior U.S. ad buyers controlling a combined $14 billion in digital ad budgets in 2018, 18% said they were decreasing their spend on Facebook. As a result, Cowen estimates the Facebook platform will lose 3% of its market share.

    No doubt Facebook’s struggles are not just about the headline scandals. For years, one innovation priority after another has fallen flat, from VR to its video push to its laggard position in the digital-assistant race. The company’s most significant “innovation” success of the past few years was copying the innovation of a competitor — pilfering Snapchat’s ephemerality for its “moments” feature.

    However, it’s the scandals that have most crippled the company’s brand and revealed the cultural rot trickling down from its senior ranks. Consider just the most-sensational revelations that emerged in 4Q18:

    • Oct. 17: The Verge reports that Facebook knew about inaccuracies in the video viewership metrics that it provided to advertisers and brands for more than a year. “The inflated video views led both advertisers and media companies to bet too much on Facebook video.”

    • Nov. 14: The New York Times publishes an investigative report that reveals Facebook hired a conservative PR firm to smear competitors and minimize the company’s role in Russia’s 2016 election meddling.

    • Dec. 5: British lawmakers release 250 pages of internal Facebook emails that show that, “the company’s executives were ruthless and unsparing in their ambition to collect more data from users, extract concessions from developers and stamp out possible competitors,” as The New York Times reported.

    • Dec. 14: Facebook reveals that a bug allowed third-party app developers to access photos people may not have shared publicly, with as many as 6.8 million users potentially affected.

    • Dec. 17: Two Senate reports reveal the shocking extent of Russia’s efforts on social media platforms during the 2016 election, including the fact thatInstagram was their biggest tool for misinformation.

    • Dec. 18: The New York Times reports that Facebook gave the world’s largest technology companies far more intrusive access to user data than previously disclosed, including the Russian search firm Yandex.

    • Dec. 20: TechCrunch reports that, “WhatsApp chat groups are being used to spread illegal child pornography, cloaked by the app’s end-to-end encryption.”

    • Dec. 27: The New York Times obtains 1,400 pages of Facebook’s moderation guidelines and discovers an indecipherable mess of confusing language, bias, and obvious errors.

    Scandal after scandal, the portrait of the company is the same: Ruthlessly and blindly obsessed with growth. Overwhelmed by that growth and unwilling to take necessary steps to compensate. Willing to lie and obfuscate until the truth becomes inescapable. And all the time excusing real-world consequences and clear violations of user and client trust because of the cultish belief that global interconnectedness is an absolute good, and therefore, Facebook is absolutely good.

    The scale of Facebook’s global responsibility is staggering. As Naughton writes for The Guardian:

    Facebook currently has 2.27bn monthly active users worldwide. Every 60 seconds, 510,000 comments are posted, 293,000 statuses are updated and 136,000 photos are uploaded to the platform. Instagram, which allows users to edit and share photos as well as videos and is owned by Facebook, has more than 1bn monthly active users. WhatsApp, the encrypted messaging service that is also owned by Facebook, now has 1.5bn monthly active users, more than half of whom use it several times a day.

    Relying on tens of thousands of moderators to anesthetize the digital commons is both inadequate, and based on the reported working conditions, unethical and exploitative. AI is not the solution either, as we explored in WILTW April 12, 2018. According to Wired, Facebook has claimed that 96% of the adult and nude images users try to upload are now automatically detected and taken down by AI. That sounds like a success until you consider that that error rate means 1.3 million such images made it to the public in the third quarter of 2018 alone (30.8 million were taken down).

    In fact, the company has acknowledged that views with nudity or sexual content have nearly doubled in the 12 months ending in September. And detecting nudity is a far easier task for a rules-based algorithm than deciding the difference between real and fake news, between hate speech and satire, or between pornography and art.

    Facebook has economically and culturally empowered hundreds of millions of people around the world. It cannot be blamed for every destabilized government, war, or murder in every region it operates. However, more and more, it’s clear that one profit-driven platform that connects all of the world’s people to all of the world’s information — the vision Zuckerberg has long had for his invention — is a terminally-flawed idea. It leads to too much power in the hands of too few. It allows bad actors to centralize their bad actions. And it is incompatible with a world that values privacy, ownership, and truth.

    Governments are waking up to this problem. So is the public. And no doubt, so are competitive innovators looking to expand or introduce alternatives. Collectively, they will chip away at Facebook’s power and profitability. Given the company’s leaders still appear blinded by and irrevocably attached to their business model and ideals, we doubt they can stave off the onslaught coming.

    *  *  *

    This article was originally published in “What I Learned This Week” on January 17, 2018. To subscribe to our weekly newsletter, visit 13D.com or find us on Twitter @WhatILearnedTW.

  • Escape from Venezuela

    A host of foreign powers including the United States, Canada, the United Kingdom and over a dozen Latin American states were quick to recognize Juan Guaido as Venezuela’s president earlier this week. The opposition leader declared himself interim president in a move embattled President Nicolas Maduro labeled a U.S. orchestrated coup. As well as having the support of Venezuela’s military, Maduro still has widespread international backing including support from Russia, China and Mexico, amongst others, according to Bloomberg

    Infographic: Who Stands Where On Venezuela?  | Statista

    You will find more infographics at Statista

    The declaration from Guaido comes after two nights of protests in the country which have led to the deaths of at least 14 people.

    As Statista’s Martin Armstrong notes, Venezuela’s problems are extensive and varied, with political, social and economic crises making life in the country very difficult. As Statista’s infographic shows, this has led to a huge increase in migration out of the country.

    Infographic: Escape from Venezuela | Statista

    You will find more infographics at Statista

    In 2015, there were almost 700,000 Venezuelans living in other countries. Fast forward to July 2018 and this figure has risen to 2.3 million – representing 7 percent of the country’s population. These are only the official figures, too. The actual number that have fled the country is thought to be much higher.

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