Two secular bear markets have occurred during the past 100 years of US history. 1929 saw the beginning of a 90% decline in equity [stock] values which transpired over the subsequent three year period. During the 1930's the US economy experienced the failure of thousands of banks and unemployment over 25% with grinding depression lasting until world war displaced depression as the overwhelming economic force. The Dow industrial index didn't regain its 1929 peak until 1954, 25 years later. The second secular bear growled its way through the 1970's, and it was truly secular in nature. Contrary to a common belief equities didn't simply move sideways through the 1970's before moving to new highs with the great bull market starting in 1982. This illusion is caused by the inflation which plagued the period. Deflating the S&P 500 with the CPI (see Chart 1) reveals that the market peaked in 1969, not 1973, before falling 64% over the subsequent 13 years, ultimately bottoming in 1982. Stock prices failed to exceed the 1969 peak until 1993, 24 years later, and didn't move convincingly through the 1969 level until 1995. At this point the weary, and rather aged, investor still faced capital gains taxes on a phantom 300% gain wholly due to inflation. Covering this tax liability likely extended the true recovery period to within shouting distance of the bear market in stocks beginning in 2000, the most recent peak in equity markets.

The most profound damage would be caused by perpetual distortion of a price which affects all consumption and investment decisions in all markets. Does such a price exist? Certainly…the rate of interest! Every consumption decision involves, although perhaps not explicitly, the choice between consumption now or saving now and consuming more in the future. Depression of interest rates makes current consumption less expensive relative to future consumption with saving relatively less attractive since earnings on savings are lower.

Business investment decisions are also affected by interest rates. Every such decision, at least implicitly, involves a valuation of discounted cash flows. A lowering of the interest rate reduces the discount making business investments look more attractive than would otherwise be the case.  

Surely, one might reasonably think, given our well developed understanding of the importance of prices in coordinating an economy and the consequences of distorting prices we wouldn't be foolish enough to manipulate the price capable of causing the most damage. Astonishingly we do so as a matter of policy! A primary function of the Federal Reserve involves the setting of short term interest rates. Furthermore institutional practices within our financial system distort the rate of interest to an even greater degree through fractional reserves at depository institutions; or most generally funding long assets with shorter term liabilities. Within modern day financial systems the rate of interest never develops through unfettered market action. All markets, financial and "real", are continually subject to distortion induced by the altered rate of interest. There is no opportunity for a market determined rate of interest to provide efficient, stabilizing coordination of resource allocation across time.  

How could we fail to apply our understanding of the power of market prices to a price as important as the interest rate?

Perhaps, in part, the answer involves the abstract nature of the issue. Interest rates guide the allocation of resources across time, a particularly elusive concept. In the immediate present, the frame of reference we all grasp most readily, destructive misallocations resulting from distortion of interest rates are not evident. In fact quite the contrary is true. Depression of the interest rate through expansion of money and credit seems to offer a miraculous opportunity to get something for nothing. As a consequence of credit ease we see higher levels of consumption, business investment, employment and financial asset values. How could any of that be bad? Periods of declining rates generally precede cyclic tops characterized by the best of conditions in the economy and financial markets.

To begin the exponential increase in values of long dated cash flows (earnings on stocks, interest payments on debt securities, etc.) which works such magic on the upside now shifts into reverse. The decline in values will be most evident in financial assets considered speculative, generally because they provide little or no cash flow in the present while holding the promise of large returns in distant periods. The value of these distant period returns are much more heavily impacted by rising rates than shorter term returns. However any long dated asset will suffer the irresistible force of higher rates of discount as interest rates climb, even those offering near term income. In short, equity and debt markets fall first and often fast. With long dated asset values falling sharply, short term liabilities remaining essentially unchanged and the cost of short term funding increasing investors quickly see profits dwindle while their net capital contracts or disappears entirely depending on their state of leverage.

Furthermore, early in the cycle short rates tend to climb faster than long rates. As the spread narrows the motivation to borrow short and lend long diminishes, curtailing creation of the new credit which might otherwise support the system. Eventually short rates may rise above long rates (inversion of the yield curve) providing a powerful incentive for outright contraction of the financial structure. As the contraction progresses long dated asset values, which are now loss making to the leveraged financial player, often prove inadequate to cover stable value short term liabilities. Previously credulous investors turn pessimistic, rightfully enough, leading to expanding risk premiums, diminishing long dated values further still. Eventually savers rush for liquidity, seeking safety in very short dated, high quality securities or even currency.

The credit crunch characteristic of financial declines reaches full force.

Bankruptcies surge among entities which previously appeared sound as the failure to meet a liability on the part of one player leads to the loss of the offsetting asset held by another which, via chain reaction, leads to further failures. The force of leverage working in reverse overwhelms the system leading to a deflationary implosion of the inherently unstable, leveraged financial structure…unless the Fed can head the dive off with another round of money expansion.

… Reduced consumption and business investment along with contraction or collapse of the financial system leads to all the painful consequences we identify with a recession or depression; bankruptcies, high unemployment, diminished incomes, lower profits and lower financial asset values. Naturally such periods are also characterized by a general pessimism. Periods of general societal depression do develop following periods of mania but the conditions which foster such extremes of spirit are a direct consequence of the distortion of the rate of interest and misinformation conveyed by these distorted rates to individuals acting in an economy.

The Fed will soon face two dreadful options, either course likely initiating the secular decline; a persistent tightening which will cause the system to cascade into deflationary decline or an attempt to fuel the next boom while necessarily fomenting price inflation, driving real short rates deeper into negative territory. The deflationary scenario isn't likely due to political realities and institutions which have been put in place since the 1930's to circumvent deflation (e.g. FDIC). We can count on the Fed to use all means at its disposal in its role as lender of last resort when the time comes, as has been promised by members of the Fed. Hence we should anticipate a secular decline characterized by price inflation. Investors who take a defensive position today (investing in T-bills, TIPS, real assets including some precious metals and not currencies) will have moved out of harms way just in time within the secular timeframe whether the worst of the decline begins 6 months or 18 months from now.

In a soundbite, the U.S.

financial system performs dismally at its advertised task, that of efficiently directing society’s savings towards their optimal investment pursuits. The system is stupefyingly expensive, gives terrible signals for the allocation of capital, and has surprisingly little to do with real investment. Most money managers can barely match market averages – and there’s evidence that active trading reduces performance rather than improving it – yet they still haul in big fees, and their brokers, big commissions. Over the long haul, almost all corporate capital expenditures are internally financed, through profits and depreciation allowances. And, instead of promoting investment, the U.S. financial system seems to do quite the opposite; U.S. investment levels rank towards the bottom of the First World (OECD) countries, and are below what even quite orthodox economists – like Darrel Cohen, Kevin Hassett, and Jim Kennedy of the Federal Reserve term “optimal” levels.  Real investment, not buying shares in a mutual fund.  

Take, for example, the stock market, which is probably the centerpiece of the whole enterprise. What does it do? Both civilians and professional apologists would probably answer by saying that it raises capital for investment. In fact, it doesn’t. Between 1981 and 1997, U.S. nonfinancial corporations retired $813 billion more in stock than they issued, thanks to takeovers and buybacks. (Henwood, Doug, Wall Street, Verso Press, 1997, p. 3)  

One thing the financial markets do very well, however, is concentrate wealth. Government debt, for example, can be thought of as a means for upward redistribution of income, from ordinary taxpayers to rich bondholders. Instead of taxing rich people, governments borrow from them, and pay them interest for the privilege. Consumer credit also enriches the rich; people suffering stagnant wages who use the VISA card to make ends meet only fatten the wallets of their creditors with each monthly payment. (Henwood, p. 4)

Many of the world's central banks are starting to look to the euro to fill their currency reserves instead of the dollar, a survey suggests.

The poll carried out by Central Banking Publications found 39 nations of the 65 surveyed raising their euro holdings, with 29 cutting back on the US dollar.

The dollar's sharp fall in the face of huge deficits could be one cause of the switch, the report says.

The survey was sponsored by the UK's Royal Bank of Scotland.

Losing ground

The last three months of 2004 saw the dollar slip by 7% against the euro, taking it to repeated all-time lows of more than $1.30.

The US is running a budget deficit of close to $500bn a year, funded largely by China and Japan buying large amounts of US government bonds.

Some economists have suggested that the two could ease their purchases, making it more difficult for the US to support its borrowing.

Similarly, the current account - the difference between the amount of money going out of the US and coming in - is deeply in the red, the result largely of large trade deficits.

Both factors have helped to push the dollar lower. However, the falling dollar does mean that central bank holdings of dollar reserves are losing value.

"Generally, central banks' approach to reserve management is becoming much more active as they search for higher returns," said the authors of the report.

"The euro seems to have come of age."

Europe's top economies battle to cut their deficits

The French and German governments will this week kickstart a spate of privatisations of state-owned companies worth more than €30bn in further efforts to cut their budget deficits below the prescribed 3% ceiling and cut debt.

On Wednesday the management board of Gaz de France (GDF), the state-owned gas group, is due to set in train plans to sell off some 30% of its equity in a placement, likely in May, that could net between €5bn and €6bn for Jacques Chirac's government.

Areva, the French nuclear plant builder, which is being touted for an eventual merger with a sister division at Alstom, the engineering group rescued by the government last year, and which is valued at €11.5bn, is also expected to place a third of its capital in May.

According to French press reports, the government could raise up to €10bn in total this year, including a further sell-off of France Telecom and the jewel in the crown of the energy sector, the electricity group EDF. The state raised €8.8bn last year, €2.5bn in 2003 and €6.1bn in 2002.

Hervé Gaymard, the successor to Nicholas Sarkozy as finance minister has yet to give the green light for the EDF transaction as the group, which has profitably bought up large swaths of the British energy sector, has complex problems associated with its nuclear liabilities, pension deficit and a stake in Italian counterpart Edison.

But, with a 30% stake likely to be sold off during a planned capital-raising exercise later this year to buttress its European expansion, EDF could fetch as much as €20bn gross for a government that has promised the EU it will cut its deficit to 3% this year from around 3.5% in 2004.

The French placements alone promise to be huge money earners for investment banks such as Merrill Lynch and Lazard which are acting as advisers to GDF and Areva but are running into stiff resistance from unions led by the communist CGT, which has called for a merger of EDF and GDF instead.

The banks are also preparing a key role in sell-offs planned for this year by Hans Eichel, the embattled German finance minister, who has pledged to bring his country's budget deficit to 2.9% after it reached 3.7% in 2004 - the third year in a row it broke the EU stability and growth pact's mandatory limit.

Mr Eichel, who is holding talks with Mr Gaymard in Berlin today, could raise between €19bn and €24bn, or more than the proposed budget deficit, by selling off more stakes in Deutsche Post, Deutsche Telekom and other assets via transfers to the state-owned Credit Agency for Reconstruction (KfW).

By the end of this month the government will have sold off 92% of the postal business, netting €8bn in the past four years, including €1.7bn this month, and wants to reduce its majority stake in Telekom -though the latter's share price has been languishing at around €20 after reaching a peak of more than €100.

Comment: The above is interesting and perhaps indicative of the fact that most foreign governments are aware that the US economy is destined to collapse some time this year.

George W. Bush’s reëlection was not his only victory last fall. The President and his national-security advisers have consolidated control over the military and intelligence communities’ strategic analyses and covert operations to a degree unmatched since the rise of the post-Second World War national-security state. Bush has an aggressive and ambitious agenda for using that control—against the mullahs in Iran and against targets in the ongoing war on terrorism—during his second term. The C.I.A. will continue to be downgraded, and the agency will increasingly serve, as one government consultant with close ties to the Pentagon put it, as “facilitators” of policy emanating from President Bush and Vice-President Dick Cheney. This process is well under way.

Despite the deteriorating security situation in Iraq, the Bush Administration has not reconsidered its basic long-range policy goal in the Middle East: the establishment of democracy throughout the region. Bush’s reëlection is regarded within the Administration as evidence of America’s support for his decision to go to war. It has reaffirmed the position of the neoconservatives in the Pentagon’s civilian leadership who advocated the invasion, including Paul Wolfowitz, the Deputy Secretary of Defense, and Douglas Feith, the Under-secretary for Policy. According to a former high-level intelligence official, Secretary of Defense Donald Rumsfeld met with the Joint Chiefs of Staff shortly after the election and told them, in essence, that the naysayers had been heard and the American people did not accept their message. Rumsfeld added that America was committed to staying in Iraq and that there would be no second-guessing.

“This is a war against terrorism, and Iraq is just one campaign. The Bush Administration is looking at this as a huge war zone,” the former high-level intelligence official told me. “Next, we’re going to have the Iranian campaign. We’ve declared war and the bad guys, wherever they are, are the enemy. This is the last hurrah—we’ve got four years, and want to come out of this saying we won the war on terrorism.”

Bush and Cheney may have set the policy, but it is Rumsfeld who has directed its implementation and has absorbed much of the public criticism when things went wrong—whether it was prisoner abuse in Abu Ghraib or lack of sufficient armor plating for G.I.s’ vehicles in Iraq. Both Democratic and Republican lawmakers have called for Rumsfeld’s dismissal, and he is not widely admired inside the military. Nonetheless, his reappointment as Defense Secretary was never in doubt.

Rumsfeld will become even more important during the second term. In interviews with past and present intelligence and military officials, I was told that the agenda had been determined before the Presidential election, and much of it would be Rumsfeld’s responsibility. The war on terrorism would be expanded, and effectively placed under the Pentagon’s control. The President has signed a series of findings and executive orders authorizing secret commando groups and other Special Forces units to conduct covert operations against suspected terrorist targets in as many as ten nations in the Middle East and South Asia.

The President’s decision enables Rumsfeld to run the operations off the books—free from legal restrictions imposed on the C.I.A. Under current law, all C.I.A. covert activities overseas must be authorized by a Presidential finding and reported to the Senate and House intelligence committees. (The laws were enacted after a series of scandals in the nineteen-seventies involving C.I.A. domestic spying and attempted assassinations of foreign leaders.) “The Pentagon doesn’t feel obligated to report any of this to Congress,” the former high-level intelligence official said. “They don’t even call it ‘covert ops’—it’s too close to the C.I.A. phrase. In their view, it’s ‘black reconnaissance.’ They’re not even going to tell the cincs”—the regional American military commanders-in-chief. (The Defense Department and the White House did not respond to requests for comment on this story.)

In my interviews, I was repeatedly told that the next strategic target was Iran. “Everyone is saying, ‘You can’t be serious about targeting Iran. Look at Iraq,’” the former intelligence official told me. “But they say, ‘We’ve got some lessons learned—not militarily, but how we did it politically. We’re not going to rely on agency pissants.’ No loose ends, and that’s why the C.I.A. is out of there.”

For more than a year, France, Germany, Britain, and other countries in the European Union have seen preventing Iran from getting a nuclear weapon as a race against time—and against the Bush Administration. They have been negotiating with the Iranian leadership to give up its nuclear-weapons ambitions in exchange for economic aid and trade benefits. Iran has agreed to temporarily halt its enrichment programs, which generate fuel for nuclear power plants but also could produce weapons-grade fissile material. (Iran claims that such facilities are legal under the Nuclear Non-Proliferation Treaty, or N.P.T., to which it is a signator, and that it has no intention of building a bomb.) But the goal of the current round of talks, which began in December in Brussels, is to persuade Tehran to go further, and dismantle its machinery. Iran insists, in return, that it needs to see some concrete benefits from the Europeans—oil-production technology, heavy-industrial equipment, and perhaps even permission to purchase a fleet of Airbuses. (Iran has been denied access to technology and many goods owing to sanctions.)

The Europeans have been urging the Bush Administration to join in these negotiations. The Administration has refused to do so. The civilian leadership in the Pentagon has argued that no diplomatic progress on the Iranian nuclear threat will take place unless there is a credible threat of military action. “The neocons say negotiations are a bad deal,” a senior official of the International Atomic Energy Agency (I.A.E.A.) told me. “And the only thing the Iranians understand is pressure. And that they also need to be whacked.”

The core problem is that Iran has successfully hidden the extent of its nuclear program, and its progress. Many Western intelligence agencies, including those of the United States, believe that Iran is at least three to five years away from a capability to independently produce nuclear warheads—although its work on a missile-delivery system is far more advanced. Iran is also widely believed by Western intelligence agencies and the I.A.E.A. to have serious technical problems with its weapons system, most notably in the production of the hexafluoride gas needed to fabricate nuclear warheads.

A retired senior C.I.A. official, one of many who left the agency recently, told me that he was familiar with the assessments, and confirmed that Iran is known to be having major difficulties in its weapons work. He also acknowledged that the agency’s timetable for a nuclear Iran matches the European estimates—assuming that Iran gets no outside help. “The big wild card for us is that you don’t know who is capable of filling in the missing parts for them,” the recently retired official said. “North Korea? Pakistan? We don’t know what parts are missing.”

One Western diplomat told me that the Europeans believed they were in what he called a “lose-lose position” as long as the United States refuses to get involved. “France, Germany, and the U.K. cannot succeed alone, and everybody knows it,” the diplomat said. “If the U.S. stays outside, we don’t have enough leverage, and our effort will collapse.” The alternative would be to go to the Security Council, but any resolution imposing sanctions would likely be vetoed by China or Russia, and then “the United Nations will be blamed and the Americans will say, ‘The only solution is to bomb.’”

A European Ambassador noted that President Bush is scheduled to visit Europe in February, and that there has been public talk from the White House about improving the President’s relationship with America’s E.U. allies. In that context, the Ambassador told me, “I’m puzzled by the fact that the United States is not helping us in our program. How can Washington maintain its stance without seriously taking into account the weapons issue?”

The Israeli government is, not surprisingly, skeptical of the European approach. Silvan Shalom, the Foreign Minister, said in an interview last week in Jerusalem, with another New Yorker journalist, “I don’t like what’s happening. We were encouraged at first when the Europeans got involved. For a long time, they thought it was just Israel’s problem. But then they saw that the [Iranian] missiles themselves were longer range and could reach all of Europe, and they became very concerned. Their attitude has been to use the carrot and the stick—but all we see so far is the carrot.” He added, “If they can’t comply, Israel cannot live with Iran having a nuclear bomb.”

In a recent essay, Patrick Clawson, an Iran expert who is the deputy director of the Washington Institute for Near East Policy (and a supporter of the Administration), articulated the view that force, or the threat of it, was a vital bargaining tool with Iran. Clawson wrote that if Europe wanted coöperation with the Bush Administration it “would do well to remind Iran that the military option remains on the table.” He added that the argument that the European negotiations hinged on Washington looked like “a preëmptive excuse for the likely breakdown of the E.U.-Iranian talks.” In a subsequent conversation with me, Clawson suggested that, if some kind of military action was inevitable, “it would be much more in Israel’s interest—and Washington’s—to take covert action. The style of this Administration is to use overwhelming force—‘shock and awe.’ But we get only one bite of the apple.”

There are many military and diplomatic experts who dispute the notion that military action, on whatever scale, is the right approach. Shahram Chubin, an Iranian scholar who is the director of research at the Geneva Centre for Security Policy, told me, “It’s a fantasy to think that there’s a good American or Israeli military option in Iran.” He went on, “The Israeli view is that this is an international problem. ‘You do it,’ they say to the West. ‘Otherwise, our Air Force will take care of it.’” In 1981, the Israeli Air Force destroyed Iraq’s Osirak reactor, setting its nuclear program back several years. But the situation now is both more complex and more dangerous, Chubin said. The Osirak bombing “drove the Iranian nuclear-weapons program underground, to hardened, dispersed sites,” he said. “You can’t be sure after an attack that you’ll get away with it. The U.S. and Israel would not be certain whether all the sites had been hit, or how quickly they’d be rebuilt. Meanwhile, they’d be waiting for an Iranian counter-attack that could be military or terrorist or diplomatic. Iran has long-range missiles and ties to Hezbollah, which has drones—you can’t begin to think of what they’d do in response.”

Chubin added that Iran could also renounce the Nuclear Non-Proliferation Treaty. “It’s better to have them cheating within the system,” he said. “Otherwise, as victims, Iran will walk away from the treaty and inspections while the rest of the world watches the N.P.T. unravel before their eyes.”

The Administration has been conducting secret reconnaissance missions inside Iran at least since last summer. Much of the focus is on the accumulation of intelligence and targeting information on Iranian nuclear, chemical, and missile sites, both declared and suspected. The goal is to identify and isolate three dozen, and perhaps more, such targets that could be destroyed by precision strikes and short-term commando raids. “The civilians in the Pentagon want to go into Iran and destroy as much of the military infrastructure as possible,” the government consultant with close ties to the Pentagon told me.

Some of the missions involve extraordinary coöperation. For example, the former high-level intelligence official told me that an American commando task force has been set up in South Asia and is now working closely with a group of Pakistani scientists and technicians who had dealt with Iranian counterparts. (In 2003, the I.A.E.A. disclosed that Iran had been secretly receiving nuclear technology from Pakistan for more than a decade, and had withheld that information from inspectors.) The American task force, aided by the information from Pakistan, has been penetrating eastern Iran from Afghanistan in a hunt for underground installations. The task-force members, or their locally recruited agents, secreted remote detection devices—known as sniffers—capable of sampling the atmosphere for radioactive emissions and other evidence of nuclear-enrichment programs.

Getting such evidence is a pressing concern for the Bush Administration. The former high-level intelligence official told me, “They don’t want to make any W.M.D. intelligence mistakes, as in Iraq. The Republicans can’t have two of those. There’s no education in the second kick of a mule.” The official added that the government of Pervez Musharraf, the Pakistani President, has won a high price for its coöperation—American assurance that Pakistan will not have to hand over A. Q. Khan, known as the father of Pakistan’s nuclear bomb, to the I.A.E.A. or to any other international authorities for questioning. For two decades, Khan has been linked to a vast consortium of nuclear-black-market activities. Last year, Musharraf professed to be shocked when Khan, in the face of overwhelming evidence, “confessed” to his activities. A few days later, Musharraf pardoned him, and so far he has refused to allow the I.A.E.A. or American intelligence to interview him. Khan is now said to be living under house arrest in a villa in Islamabad. “It’s a deal—a trade-off,” the former high-level intelligence official explained. “‘Tell us what you know about Iran and we will let your A. Q. Khan guys go.’ It’s the neoconservatives’ version of short-term gain at long-term cost. They want to prove that Bush is the anti-terrorism guy who can handle Iran and the nuclear threat, against the long-term goal of eliminating the black market for nuclear proliferation.”

The agreement comes at a time when Musharraf, according to a former high-level Pakistani diplomat, has authorized the expansion of Pakistan’s nuclear-weapons arsenal. “Pakistan still needs parts and supplies, and needs to buy them in the clandestine market,” the former diplomat said. “The U.S. has done nothing to stop it.”

There has also been close, and largely unacknowledged, coöperation with Israel. The government consultant with ties to the Pentagon said that the Defense Department civilians, under the leadership of Douglas Feith, have been working with Israeli planners and consultants to develop and refine potential nuclear, chemical-weapons, and missile targets inside Iran. (After Osirak, Iran situated many of its nuclear sites in remote areas of the east, in an attempt to keep them out of striking range of other countries, especially Israel. Distance no longer lends such protection, however: Israel has acquired three submarines capable of launching cruise missiles and has equipped some of its aircraft with additional fuel tanks, putting Israeli F-16I fighters within the range of most Iranian targets.)

“They believe that about three-quarters of the potential targets can be destroyed from the air, and a quarter are too close to population centers, or buried too deep, to be targeted,” the consultant said. Inevitably, he added, some suspicious sites need to be checked out by American or Israeli commando teams—in on-the-ground surveillance—before being targeted.

The Pentagon’s contingency plans for a broader invasion of Iran are also being updated. Strategists at the headquarters of the U.S. Central Command, in Tampa, Florida, have been asked to revise the military’s war plan, providing for a maximum ground and air invasion of Iran. Updating the plan makes sense, whether or not the Administration intends to act, because the geopolitics of the region have changed dramatically in the last three years. Previously, an American invasion force would have had to enter Iran by sea, by way of the Persian Gulf or the Gulf of Oman; now troops could move in on the ground, from Afghanistan or Iraq. Commando units and other assets could be introduced through new bases in the Central Asian republics.

It is possible that some of the American officials who talk about the need to eliminate Iran’s nuclear infrastructure are doing so as part of a propaganda campaign aimed at pressuring Iran to give up its weapons planning. If so, the signals are not always clear. President Bush, who after 9/11 famously depicted Iran as a member of the “axis of evil,” is now publicly emphasizing the need for diplomacy to run its course. “We don’t have much leverage with the Iranians right now,” the President said at a news conference late last year. “Diplomacy must be the first choice, and always the first choice of an administration trying to solve an issue of . . . nuclear armament. And we’ll continue to press on diplomacy.”

In my interviews over the past two months, I was given a much harsher view. The hawks in the Administration believe that it will soon become clear that the Europeans’ negotiated approach cannot succeed, and that at that time the Administration will act. “We’re not dealing with a set of National Security Council option papers here,” the former high-level intelligence official told me. “They’ve already passed that wicket. It’s not if we’re going to do anything against Iran. They’re doing it.”

The immediate goals of the attacks would be to destroy, or at least temporarily derail, Iran’s ability to go nuclear. But there are other, equally purposeful, motives at work. The government consultant told me that the hawks in the Pentagon, in private discussions, have been urging a limited attack on Iran because they believe it could lead to a toppling of the religious leadership. “Within the soul of Iran there is a struggle between secular nationalists and reformers, on the one hand, and, on the other hand, the fundamentalist Islamic movement,” the consultant told me. “The minute the aura of invincibility which the mullahs enjoy is shattered, and with it the ability to hoodwink the West, the Iranian regime will collapse”—like the former Communist regimes in Romania, East Germany, and the Soviet Union. Rumsfeld and Wolfowitz share that belief, he said.

“The idea that an American attack on Iran’s nuclear facilities would produce a popular uprising is extremely illinformed,” said Flynt Leverett, a Middle East scholar who worked on the National Security Council in the Bush Administration. “You have to understand that the nuclear ambition in Iran is supported across the political spectrum, and Iranians will perceive attacks on these sites as attacks on their ambitions to be a major regional player and a modern nation that’s technologically sophisticated.” Leverett, who is now a senior fellow at the Saban Center for Middle East Policy, at the Brookings Institution, warned that an American attack, if it takes place, “will produce an Iranian backlash against the United States and a rallying around the regime.”

Rumsfeld planned and lobbied for more than two years before getting Presidential authority, in a series of findings and executive orders, to use military commandos for covert operations. One of his first steps was bureaucratic: to shift control of an undercover unit, known then as the Gray Fox (it has recently been given a new code name), from the Army to the Special Operations Command (socom), in Tampa. Gray Fox was formally assigned to socom in July, 2002, at the instigation of Rumsfeld’s office, which meant that the undercover unit would have a single commander for administration and operational deployment. Then, last fall, Rumsfeld’s ability to deploy the commandos expanded. According to a Pentagon consultant, an Execute Order on the Global War on Terrorism (referred to throughout the government as gwot) was issued at Rumsfeld’s direction. The order specifically authorized the military “to find and finish” terrorist targets, the consultant said. It included a target list that cited Al Qaeda network members, Al Qaeda senior leadership, and other high-value targets. The consultant said that the order had been cleared throughout the national-security bureaucracy in Washington.

In late November, 2004, the Times reported that Bush had set up an interagency group to study whether it “would best serve the nation” to give the Pentagon complete control over the C.I.A.’s own élite paramilitary unit, which has operated covertly in trouble spots around the world for decades. The panel’s conclusions, due in February, are foregone, in the view of many former C.I.A. officers. “It seems like it’s going to happen,” Howard Hart, who was chief of the C.I.A.’s Paramilitary Operations Division before retiring in 1991, told me.

There was other evidence of Pentagon encroachment. Two former C.I.A. clandestine officers, Vince Cannistraro and Philip Giraldi, who publish Intelligence Brief, a newsletter for their business clients, reported last month on the existence of a broad counter-terrorism Presidential finding that permitted the Pentagon “to operate unilaterally in a number of countries where there is a perception of a clear and evident terrorist threat. . . . A number of the countries are friendly to the U.S. and are major trading partners. Most have been cooperating in the war on terrorism.” The two former officers listed some of the countries—Algeria, Sudan, Yemen, Syria, and Malaysia. (I was subsequently told by the former high-level intelligence official that Tunisia is also on the list.)

Giraldi, who served three years in military intelligence before joining the C.I.A., said that he was troubled by the military’s expanded covert assignment. “I don’t think they can handle the cover,” he told me. “They’ve got to have a different mind-set. They’ve got to handle new roles and get into foreign cultures and learn how other people think. If you’re going into a village and shooting people, it doesn’t matter,” Giraldi added. “But if you’re running operations that involve finesse and sensitivity, the military can’t do it. Which is why these kind of operations were always run out of the agency.” I was told that many Special Operations officers also have serious misgivings.

Rumsfeld and two of his key deputies, Stephen Cambone, the Under-secretary of Defense for Intelligence, and Army Lieutenant General William G. (Jerry) Boykin, will be part of the chain of command for the new commando operations. Relevant members of the House and Senate intelligence committees have been briefed on the Defense Department’s expanded role in covert affairs, a Pentagon adviser assured me, but he did not know how extensive the briefings had been.

“I’m conflicted about the idea of operating without congressional oversight,” the Pentagon adviser said. “But I’ve been told that there will be oversight down to the specific operation.” A second Pentagon adviser agreed, with a significant caveat. “There are reporting requirements,” he said. “But to execute the finding we don’t have to go back and say, ‘We’re going here and there.’ No nitty-gritty detail and no micromanagement.”

The legal questions about the Pentagon’s right to conduct covert operations without informing Congress have not been resolved. “It's a very, very gray area,” said Jeffrey H. Smith, a West Point graduate who served as the C.I.A.’s general counsel in the mid-nineteen-nineties. “Congress believes it voted to include all such covert activities carried out by the armed forces. The military says, ‘No, the things we’re doing are not intelligence actions under the statute but necessary military steps authorized by the President, as Commander-in-Chief, to “prepare the battlefield.’” Referring to his days at the C.I.A., Smith added, “We were always careful not to use the armed forces in a covert action without a Presidential finding. The Bush Administration has taken a much more aggressive stance.”

In his conversation with me, Smith emphasized that he was unaware of the military’s current plans for expanding covert action. But he said, “Congress has always worried that the Pentagon is going to get us involved in some military misadventure that nobody knows about.”

Under Rumsfeld’s new approach, I was told, U.S. military operatives would be permitted to pose abroad as corrupt foreign businessmen seeking to buy contraband items that could be used in nuclear-weapons systems. In some cases, according to the Pentagon advisers, local citizens could be recruited and asked to join up with guerrillas or terrorists. This could potentially involve organizing and carrying out combat operations, or even terrorist activities. Some operations will likely take place in nations in which there is an American diplomatic mission, with an Ambassador and a C.I.A. station chief, the Pentagon consultant said. The Ambassador and the station chief would not necessarily have a need to know, under the Pentagon’s current interpretation of its reporting requirement.

The new rules will enable the Special Forces community to set up what it calls “action teams” in the target countries overseas which can be used to find and eliminate terrorist organizations. “Do you remember the right-wing execution squads in El Salvador?” the former high-level intelligence official asked me, referring to the military-led gangs that committed atrocities in the early nineteen-eighties. “We founded them and we financed them,” he said. “The objective now is to recruit locals in any area we want. And we aren’t going to tell Congress about it.” A former military officer, who has knowledge of the Pentagon’s commando capabilities, said, “We’re going to be riding with the bad boys.”

One of the rationales for such tactics was spelled out in a series of articles by John Arquilla, a professor of defense analysis at the Naval Postgraduate School, in Monterey, California, and a consultant on terrorism for the rand corporation. “It takes a network to fight a network,” Arquilla wrote in a recent article in the San Francisco Chronicle:

When conventional military operations and bombing failed to defeat the Mau Mau insurgency in Kenya in the 1950s, the British formed teams of friendly Kikuyu tribesmen who went about pretending to be terrorists. These “pseudo gangs,” as they were called, swiftly threw the Mau Mau on the defensive, either by befriending and then ambushing bands of fighters or by guiding bombers to the terrorists’ camps. What worked in Kenya a half-century ago has a wonderful chance of undermining trust and recruitment among today’s terror networks. Forming new pseudo gangs should not be difficult.

“If a confused young man from Marin County can join up with Al Qaeda,” Arquilla wrote, referring to John Walker Lindh, the twenty-year-old Californian who was seized in Afghanistan, “think what professional operatives might do.”

A few pilot covert operations were conducted last year, one Pentagon adviser told me, and a terrorist cell in Algeria was “rolled up” with American help. The adviser was referring, apparently, to the capture of Ammari Saifi, known as Abderrezak le Para, the head of a North African terrorist network affiliated with Al Qaeda. But at the end of the year there was no agreement within the Defense Department about the rules of engagement. “The issue is approval for the final authority,” the former high-level intelligence official said. “Who gets to say ‘Get this’ or ‘Do this’?”

A retired four-star general said, “The basic concept has always been solid, but how do you insure that the people doing it operate within the concept of the law? This is pushing the edge of the envelope.” The general added, “It’s the oversight. And you’re not going to get Warner”—John Warner, of Virginia, the chairman of the Senate Armed Services Committee—“and those guys to exercise oversight. This whole thing goes to the Fourth Deck.” He was referring to the floor in the Pentagon where Rumsfeld and Cambone have their offices.

“It’s a finesse to give power to Rumsfeld—giving him the right to act swiftly, decisively, and lethally,” the first Pentagon adviser told me. “It’s a global free-fire zone.”

The Pentagon has tried to work around the limits on covert activities before. In the early nineteen-eighties, a covert Army unit was set up and authorized to operate overseas with minimal oversight. The results were disastrous. The Special Operations program was initially known as Intelligence Support Activity, or I.S.A., and was administered from a base near Washington (as was, later, Gray Fox). It was established soon after the failed rescue, in April, 1980, of the American hostages in Iran, who were being held by revolutionary students after the Islamic overthrow of the Shah’s regime. At first, the unit was kept secret from many of the senior generals and civilian leaders in the Pentagon, as well as from many members of Congress. It was eventually deployed in the Reagan Administration’s war against the Sandinista government, in Nicaragua. It was heavily committed to supporting the Contras. By the mid-eighties, however, the I.S.A.’s operations had been curtailed, and several of its senior officers were courtmartialled following a series of financial scandals, some involving arms deals. The affair was known as “the Yellow Fruit scandal,” after the code name given to one of the I.S.A.’s cover organizations—and in many ways the group’s procedures laid the groundwork for the Iran-Contra scandal.

Despite the controversy surrounding Yellow Fruit, the I.S.A. was kept intact as an undercover unit by the Army. “But we put so many restrictions on it,” the second Pentagon adviser said. “In I.S.A., if you wanted to travel fifty miles you had to get a special order. And there were certain areas, such as Lebanon, where they could not go.” The adviser acknowledged that the current operations are similar to those two decades earlier, with similar risks—and, as he saw it, similar reasons for taking the risks. “What drove them then, in terms of Yellow Fruit, was that they had no intelligence on Iran,” the adviser told me. “They had no knowledge of Tehran and no people on the ground who could prepare the battle space.”

Rumsfeld’s decision to revive this approach stemmed, once again, from a failure of intelligence in the Middle East, the adviser said. The Administration believed that the C.I.A. was unable, or unwilling, to provide the military with the information it needed to effectively challenge stateless terrorism. “One of the big challenges was that we didn’t have Humint”—human intelligence—“collection capabilities in areas where terrorists existed,” the adviser told me. “Because the C.I.A. claimed to have such a hold on Humint, the way to get around them, rather than take them on, was to claim that the agency didn’t do Humint to support Special Forces operations overseas. The C.I.A. fought it.” Referring to Rumsfeld’s new authority for covert operations, the first Pentagon adviser told me, “It’s not empowering military intelligence. It’s emasculating the C.I.A.”

A former senior C.I.A. officer depicted the agency’s eclipse as predictable. “For years, the agency bent over backward to integrate and coördinate with the Pentagon,” the former officer said. “We just caved and caved and got what we deserved. It is a fact of life today that the Pentagon is a five-hundred-pound gorilla and the C.I.A. director is a chimpanzee.”

There was pressure from the White House, too. A former C.I.A. clandestine-services officer told me that, in the months after the resignation of the agency’s director George Tenet, in June, 2004, the White House began “coming down critically” on analysts in the C.I.A.’s Directorate of Intelligence (D.I.) and demanded “to see more support for the Administration’s political position.” Porter Goss, Tenet’s successor, engaged in what the recently retired C.I.A. official described as a “political purge” in the D.I. Among the targets were a few senior analysts who were known to write dissenting papers that had been forwarded to the White House. The recently retired C.I.A. official said, “The White House carefully reviewed the political analyses of the D.I. so they could sort out the apostates from the true believers.” Some senior analysts in the D.I. have turned in their resignations—quietly, and without revealing the extent of the disarray.

The White House solidified its control over intelligence last month, when it forced last-minute changes in the intelligence-reform bill. The legislation, based substantially on recommendations of the 9/11 Commission, originally gave broad powers, including authority over intelligence spending, to a new national-intelligence director. (The Pentagon controls roughly eighty per cent of the intelligence budget.) A reform bill passed in the Senate by a vote of 96-2. Before the House voted, however, Bush, Cheney, and Rumsfeld balked. The White House publicly supported the legislation, but House Speaker Dennis Hastert refused to bring a House version of the bill to the floor for a vote—ostensibly in defiance of the President, though it was widely understood in Congress that Hastert had been delegated to stall the bill. After intense White House and Pentagon lobbying, the legislation was rewritten. The bill that Congress approved sharply reduced the new director’s power, in the name of permitting the Secretary of Defense to maintain his “statutory responsibilities.” Fred Kaplan, in the online magazine Slate, described the real issues behind Hastert’s action, quoting a congressional aide who expressed amazement as White House lobbyists bashed the Senate bill and came up “with all sorts of ludicrous reasons why it was unacceptable.”

“Rummy’s plan was to get a compromise in the bill in which the Pentagon keeps its marbles and the C.I.A. loses theirs,” the former high-level intelligence official told me. “Then all the pieces of the puzzle fall in place. He gets authority for covert action that is not attributable, the ability to directly task national-intelligence assets”—including the many intelligence satellites that constantly orbit the world.

“Rumsfeld will no longer have to refer anything through the government’s intelligence wringer,” the former official went on. “The intelligence system was designed to put competing agencies in competition. What’s missing will be the dynamic tension that insures everyone’s priorities—in the C.I.A., the D.O.D., the F.B.I., and even the Department of Homeland Security—are discussed. The most insidious implication of the new system is that Rumsfeld no longer has to tell people what he’s doing so they can ask, ‘Why are you doing this?’ or ‘What are your priorities?’ Now he can keep all of the mattress mice out of it.”

Comment: To sum up: There has been a coup in the US. A group of right wing megalomaniac nut jobs have decided that the concept of democratic oversight or limits on their power is not something they are prepared to accept. 9/11 was their manufactured catalyst to force Congress and the American people to accept their covert policy of manufacturing 'on the ground' terrorist threats in nations which they desire to invade and appropriate. To do this they have demolished and/or co-opted the existing intelligence apparatus in the US and in its place established a 'think tank' made up of people who fully embrace their belief in pre-emptive attacks on other nations.

The fundamental lie that underpins their entire ideology is the idea that Muslim nations must be prevented from gaining nuclear capability on the grounds that such capability poses an immediate threat to America and its people. The American government has done much over the years to simply the concept of nuclear weapons in the mind of the average citizen. The truth is that the manufacture of 'nukes' is beyond the capabilities of all but a handful of the largest countries in the world. The possession of nuclear weapons by major nations has for years been touted as the best defence against the world ever experiencing a 'nuclear holocaust' because of the mutually assured destruction that any nuclear war entails. As such it is not reasonable to suggest that countries like Iran would preemptively attack any Western nation (or Israel). In fact, any desire or attempt on Iran's part to acquire nuclear capabilities is most likely for the purpose of discouraging the type of illegal invasion and conquest that is currently being planned by the US. This is the real reason for the rush to convince the world that an invasion of Iran is necessary.

In recent years, some political commentators (most notably Mike Ruppert) have been noisily sounding the alarm over "peak oil", claiming that this issue is the hidden motivation for the current US administration's campaign for complete domination of the Middle East and much of the rest of the world. There are however many problems with the peak oil argument, not least of which is the fact that it has not been convincingly proven that the world's oil reserves are seriously depleted with no new reserves in sight.

From our own extensive research, we have come to a rather different explanation for the current geopolitical climate.

History shows that our planet undergoes cyclical natural catastrophes, be they from cometary bombardment or terrestrial upheavals. We believe that another event such as those that have plagued our planet for millennia is imminent. We also surmise that certain individuals at certain levels of government, both in the US and other countries, are aware of this fact. Given the nature of the 'ruling elite' in the US, and American preeminence in terms of military and economic might, it is not surprising that the US has taken the lead in attempting to prepare for this event. This preparation involves securing the natural resources that are required to sustain civilisation. First and foremost among these is oil.

It is not hard to see that the advent of a natural cataclysm poses serious problems for those people who have become accustomed to possessing absolute power. It would be difficult, if not impossible, to predict just where a large incoming meteorite might strike. For example, it might impact the landmass of the US, decimating the population and rendering the country uninhabitable for many years. Faced with such incertitude, the US governing elite have decided to hedge their bets and annex those areas of the world that will be essential to the maintenance of their positions of power in the aftermath of a global upheaval.

A previously unknown intelligence programme set up two years ago by the Pentagon has been operating in states deemed to be "emerging target countries", the Washington Post reported yesterday.

Providing further evidence of the centralisation of power around Donald Rumsfeld, the Strategic Support Branch was created to give the defence secretary the "full spectrum of humint [human intelligence] operations," according to Pentagon documents quoted by the paper.

The programme reportedly conducts operations in friendly and unfriendly states where conventional war might not even be a distant prospect. It deploys intelligence officers, including linguists, technical specialists and interrogators, alongside secret special forces in countries such as Somalia, Yemen, Indonesia, the Philippines and Georgia, the Washington Post said.

The deployment of the unit further muddies the issue of accountability for covert and clandestine intelligence operations in the "war on terror". The programme was established by diverting existing Pentagon funds, thus freeing it from any congressional oversight.

Recent administration guidelines suggest that the Pentagon need not report all "deployment orders" to Congress, as it did previously. Pentagon lawyers argue that by defining the "war on terror" as indefinite, global and ongoing, the defence secretary's war powers are extended beyond times of imminent combat.

"Operations the CIA runs have one set of restrictions and oversight, and the military has another," a Republican member of Congress with a role in the oversight of national security told the paper.

"It sounds like there's an angle here of, 'Let's get around having any oversight by having the military do something that normally the [CIA] does, and not tell anybody.' That immediately raises all kinds of red flags for me. Why aren't they telling us?"

There has been a long turf war between the CIA and the Pentagon to determine control over intelligence operations.

Mr Rumsfeld and the Pentagon are known to see the CIA as having a slow-moving and timid culture. The White House shares their concerns, and has launched far-reaching reforms of the agency. The White House and the Pentagon also succeeded in watering down proposals in the recently passed intelligence bill which would have invested power in the new national intelligence director at the expense of the Pentagon.

The Strategic Support Branch was set up in April 2002 under the codename Project Icon. It is a branch of the Pentagon's Defence Human Intelligence Service and is intended to complement the Special Operations Command, based in Tampa.

The revelations follow allegations last week that US special forces have been active inside Iran, identifying and helping prepare targets for possible US strikes against the country's nuclear facilities.

US Defence Secretary Donald Rumsfeld cancelled a planned visit to Germany after a US human rights organisation asked German authorities to prosecute him for war crimes, Deutsche Presse-Agentur (dpa) has learned.

Rumsfeld has informed the German government via the US embassy that he will not take part in the Munich Security Conference in February, conference head Horst Teltschik told dpa on Thursday.

The New York-based Centre for Constitutional Rights filed a
complaint in December with the Federal German Prosecutor's Office against Rumsfeld accusing him of war crimes and torture in connection with detainee abuses at Iraq's Abu Ghraib prison.

Rumsfeld made it known immediately after the complaint was filed that he would not attend the Munich conference unless Germany quashed the legal action.

German legislation violations

The organisation alleges violations of German legislation, which
outlaws war crimes, crimes against humanity and genocide independent of the place of crime or origin of the accused.

The prosecutor's office in Karlsruhe reportedly is examining the
roughly 170-page complaint to see whether an investigation is warranted.

The Centre for Constitutional Rights said it and four Iraqis allegedly tortured in US custody filed a complaint with German authorities against Rumsfeld, former CIA director George Tenet and eight other senior military and civilian officials over abuses at Abu Ghraib and elsewhere in Iraq.

The organisation said it had turned to German prosecutors "as a court of last resort" because the US government "is unwilling to open an independent investigation" and had "refused to join the International Criminal Court".

Comment: We would like to extend our congratulations to Mr. Rumsfeld. He has now joined that elite group of international pariahs who are wanted around the world for crimes against humanity and/or international war crimes.

Standing shoulder to shoulder with Rumsfeld are other international fugitives such as Agusto Pinochet, the brutal and bloodthirsty Chilean dictator of the 1970's and 80's and Henry Kissinger who, coincidentally, played a central role in establishing Pinochet's regime.

Kissinger's resume extends to his activities in SE Asia during his time as Secretary of State under Nixon and Ford and includes his role in propping up Pol Pot and sanctioning the bombing of Cambodia's civilians by US war planes and his military and political support for the Indonesian Junta's slaughter of hundreds of thousands of East Timor civilians in 1975. Yes indeed, Kissinger is the consummate statesman and we do not doubt that 'ol Rummy will be honored to be numbered among these "elder statesmen" of our world.

If Bush wanted to tackle tyranny, he could start with regimes under US control. But liberty clearly has limits, says Gary Younge.

There is one tiny corner of Cuba that will forever America be. It is a place where innocent people are held without charge for years, beyond international law, human decency and the mythical glow of Lady Liberty's torch. It is a place where torture is common, beating is ritual and humiliation is routine. They call it Guantánamo Bay.

Last week the new United States secretary of state, Condoleezza Rice, listed Cuba, among others, as "an outpost of tyranny". A few days later President Bush started his second term with a pledge to unleash "the force of freedom" on the entire world. "The best hope for peace in our world is the expansion of freedom in all the world," he said

You would think that if the Americans are truly interested in expanding freedom and ending tyranny in Cuba, let alone the rest of the world, Guantánamo Bay would be as good a place to start as any. But the captives in Guantánamo should not ask for the keys to their leg irons any time soon. Ms Rice was not referring to the outpost of tyranny that her boss created in Cuba, but the rest of the Caribbean island, which lives in a stable mixture of the imperfect and the impressive.

In short, while the US could liberate a place where there are flagrant human rights abuses and over which they have total control, it would rather topple a sovereign state, which poses no threat, through diplomatic and economic - and possibly military - warfare that is already causing chaos and hardship.

Welcome to Bush's foreign policy strategy for the second term. His aim is not to realign the values at Guantánamo so that they are more in line with those championed by the rest of the world. It is to try and realign the rest of the world so that it is more in keeping with the values that govern Guantánamo, where human rights and legal norms are subordinated to America's perceived interests.

Under this philosophy, the Bush administration understands the words "tyranny" and "freedom" in much the same way as it understands international law. They mean whatever the White House wants them to mean. Bush is happy to support democracy when democracy supports America, just as he is happy to dispense with it when it does not. Likewise, when tyranny is inconvenient, he will excoriate it; when it is expedient, he will excuse it.

Take Uzbekistan, one of the most repressive regimes in central Asia. In April 2002, a special UN rapporteur concluded that torture in the country was "systematic" and "pervasive and persistent... throughout the investigation process". In the same year, Muzafar Avazov, an opposition leader, was boiled alive for refusing to abandon his religious convictions and attempting to practise religious rites in prison. In 2003, Bush granted a waiver to Uzbekistan when its failure to improve its human rights record should have led to its aid being slashed. In February 2004 the US secretary of defence, Donald Rumsfeld, visited the country's dictator, Islam Karimov, and said: "The relationship [between our countries] is strong and growing stronger. We look forward to strengthening our political and economic relations."

Yet the US continues to shower the country with aid, docking a mere $18m last year (around 20% of the total) after expressing its "disappointment" that Mr Karimov had not made greater strides towards democracy. Pan down the shopping list of tyrannical states in Ms Rice's in-tray (Iran, Burma, North Korea, Zimbabwe, Belarus and Cuba) and you will find no mention of Uzbekistan. Why? Because Uzbekistan, with an estimated 10,000 political prisoners, hosts a US military base that offers easy access to Afghanistan and the rest of the region.

So for every tenet that Mr Bush claimed last week to hold dear, it was possible to pick out a country or place he is bankrolling or controlling that is in flagrant violation, and where he could improve conditions immediately if he wished. The point here is not that the US should intervene in more places, but that it should intervene consistently and honestly or not at all.

Bush's inauguration speech was packed with truisms, axioms, platitudes and principles that appear reasonable at first glance. The trouble is they are contradicted by the reality he has created and continues to support.

As he delivered his address, you could almost whisper the caveats. "America will not pretend that jailed dissidents prefer their chains [apart from in Abu Ghraib and Guantánamo Bay], or that women welcome humiliation and servitude [apart from in Saudi Arabia] or that any human being aspires to live at the mercy of bullies [apart from Uzbekistan and Israel]."

Such hypocrisy is not new. When Mr Bush said "Our goal instead is to help others find their own voice, attain their own freedom and make their own way", nobody imagined he was referring to the Bolivian peasants fighting oil price hikes and globalisation or the landless Venezuelans taking over farms.

The agenda for a second Bush term represents not a change in direction but an acceleration of the colossal and murderous folly that he, and most of his predecessors, have pursued.

The damage that this selective notion of liberty inflicts on the rest of the world should by now be pretty clear. According to the independent website Iraqbodycount.net, reported civilian deaths in Iraq have already reached between 15,365 and 17,582 since the war started, while the recent study for the Lancet estimated the death toll at 100,000 at least, and probably higher; meanwhile, the number is growing remorselessly. Next weekend's elections in Iraq - which take place in the midst of a war against foreign occupiers with most candidates too scared to campaign, the location of polling sites kept secret until the last minute and key areas unable to participate - have become not an example of democracy but an embarrassment to the very idea of democracy.

Meanwhile, a global poll for the BBC last week showed the US more isolated than ever, with people in 18 out of 21 countries saying that they expect a second Bush term to have a negative impact on peace and security.

What is less clear is whether most Americans understand that this isolation leaves them more vulnerable to attack. Ms Rice last week promised "a conversation, not a monologue" with the rest of the world. But as the situation in Iraq shows, conversations that start with "D'you want a piece of this?" rarely end well for anybody.

Both Osama bin Laden and the Taliban have shown that the tyrants the US supports today can easily turn against it tomorrow while fostering resentment among their victims. Yet the idea that the US is a civilising force endowed with benevolent intentions is still as prevalent within the US as it is rejected outside it.

Indeed, Tony Blair seems to be the only foreign leader who still holds to the mixture of wishful thinking, wilful ignorance and warped logic behind the idea that Bush is leading humanitarian interventions at the barrel of a gun.

When questioned about the prospects for Bush's second term, the British prime minister was upbeat. "Evolution comes with experience," he said. The fact that Bush does not believe in evolution has long been known. Only now are we discovering how little Blair learns from experience.

WASHINGTON - The White House has scrapped its list of Iraq allies known as the 45-member "coalition of the willing," which Washington used to back its argument that the 2003 invasion was a multilateral action, an official said on Friday.

The senior administration official, who spoke on condition of anonymity, said the White House replaced the coalition list with a smaller roster of 28 countries with troops in Iraq sometime after the June transfer of power to an interim Iraqi government.

The official could not say when or why the administration did away with the list of the coalition of the willing.

The coalition, unveiled on the eve of the invasion, consisted of 30 countries that publicly offered support for the United States and another 15 that did not want to be named as part of the group.

Former coalition member Costa Rica withdrew last September under pressure from voters who opposed the government's decision to back the invasion.

On Friday, an organization from Iceland published a full-page advertisement in the New York Times calling for its country's withdrawal from the coalition and offering apologies for its support for U.S. policy.

The United States, backed by major allies, including Britain and Italy, invaded Iraq in March 2003 on the premise that Saddam Hussein posed a grave threat because he possessed weapons of mass destruction, or WMD.

The Bush administration acknowledged this month that it has abandoned its search for WMD without finding any biological, chemical or nuclear weapons.

Secretary of State-designate Condoleezza Rice, who was national security adviser to U.S. President George W. Bush at the time of the invasion, told a Senate panel this week that the administration had made some bad decisions in Iraq.

Nearly 1,370 members of the U.S. armed forces have been killed and another 10,500 have been wounded in Iraq since the invasion.

Unofficial estimates put the civilian Iraqi death toll at between 14,000 and 100,000

Comment: Of course, if you have a look at this revised smaller roster, you will notice that it is mostly made up of tiny client states of the US. As such, the very name "coalition of the willing" is a complete and utter farce and would be laughable if the actions that have been carried out in its name were not so despicable.

Iraqi voters don't know the names of most of the 7,000 parliamentary candidates. They may still not know when they go to the polls a week from Sunday to elect a parliament that will draft a constitution.

The Iraqi Electoral Commission keeps talking about publishing the names. But many of the candidates -- those who can't afford bodyguards -- don't want their names known for fear they will become targets for assassination. Several candidates whose identities became known have been killed by insurgents determined to wreck the election. Others have been kidnapped.

A team of international election observers has decided that it's too dangerous to monitor the election from inside Iraq, so some will monitor events from neighboring Jordan, others from Toronto. [...]

How will the election work?

Iraqis 18 and older, including the approximately 4 million living outside Iraq, are eligible to vote at polling places around the country and in 14 other countries where most Iraqi expatriates live. The United States has polling places in Chicago, Detroit, Los Angeles, Nashville and Washington, D.C.

The ballot for the national parliament is not divided into districts, like a U.S. House race. Instead, each voter has the same choices. The choices range from individual candidates, to party slates, to coalitions comprised of several parties. The voter votes for just one slate.

On the ballot, each slate will be signified by a name, such as the United Iraqi Alliance or the Iraqi List, a number, which the coalition has been publicizing to its followers, and a symbol, designed to help illiterate voters.

Each choice represents a list of candidates, in rank order, on file with the Iraqi Electoral Commission. Each list will get seats in parliament equal to the portion of overall vote it receives.

After the vote, it is expected to take about two weeks before a result is announced. That is partly because of security measures that will be taken with the ballots, and partly so that the winners, whose identities will finally become public, will have time to arrange for security.

After the parliament is seated, it is supposed to elect a three-member presidency, which will nominate a member of the parliament to become prime minister and form a cabinet.

Michael Rubin, who just returned from a trip to Iraq and who worked for the Defense Department as an adviser to the Coalition Provisional Authority, said the major Iraqi political players are already deep in negotiations over who will get which job after the elections. And, he said, U.S. officials are deeply involved in the discussions.

The Americans have been promoting the finance minister of the current interim government, Adel Abdul-Mehdi, as an acceptable choice for prime minister, Rubin said. [...]

Who will win?

It's widely assumed that the UIA list will get the most votes. This a broad, mostly Shiite coalition that includes candidates from 11 parties plus several independents. It was organized under the guidance of Al-Sistani and, although he is not a candidate, his face appears on the UIA posters.

Al-Sistani and Abdel-Aziz al-Hakim, the top name on the UIA list, have extensive ties to Iran, which has led to speculation that the election will produce a pro-Iranian government.

What are the implications for the U.S. role in Iraq?

The Chicago Tribune quoted one Shiite voter who said "the election will be the happiest day of my life because it will mean the end of the occupation."

The New York Times on Wednesday reported that U.S. intelligence officials have concluded that the Shiite-led government likely to emerge from the elections will almost certainly ask the United States to set a specific timetable for withdrawing its troops, something the Bush administration has resisted.

But U.S. officials have said that if a democratically elected government asks the U.S. to leave Iraq, it will comply.

Abbas Mehdi of Minnetonka, a native of Iraq who stays in touch with his family there, said most Iraqis do not believe that the United States will allow such an outcome, that Washington will find some way to rig the election so that U.S. interests in Iraq are safeguarded.

Mehdi shares some of that skepticism, but also believes "the U.S. has put itself into a box."

If the UIA slate loses and Al-Sistani announces that the U.S. has stolen the election, then the majority Shiites are liable to join the anti-American insurgency, Mehdi said.

If the UIA slate wins, and the new government demands a deadline for ending the occupation, and the U.S. complies, "then at least you have to hand it to the United States for delivering true democracy."

Comment: It would appear that the Iraq "elections" are shaping up to be a carbon copy of the recent US elections. No one should think that the US will walk away from Iraq without first ensuring that the new Iraqi government is ruled by a cabal of westernised Iraqi 'yes men'. With the vast majority of the candidates unknown to voters and voter turn out likely to be extremely low, we have to wonder just what type of election this will be. Oh yes, we forgot, it's American democracy that has been exported to Iraq.

Two US soldiers have been given jail terms, reductions in rank and bad conduct discharges for their role in the killing of a female civilian interpreter in Iraq.

In a statement, the military said Specialist Charley Hooser of the 1st Cavalry Division was sentenced to three years in jail after being convicted of one count of involuntary manslaughter and one count of making a false statement. 

"The convictions stem from an incident on November 24, when Hooser killed an interpreter, shooting her in the head," the military said late on Saturday.

"Later that day, he made an official statement with the intent to deceive, denying involvement in the death of the civilian interpreter." 
Another soldier from the 1st Cavalry Division, Specialist Rami Dajani, was sentenced to 18 months in jail for his role in the incident, the military said. 

It said Dajani had supplied the gun that killed the interpreter and had later "made an official statement with the intent to deceive, denying involvement in the death of a civilian interpreter". 

A killer joke

On the day of the incident, Dajani and 28-year-old Luma, whose full name was not disclosed, were in a room at an American base, joking about killing someone, the soldiers testified at the court martial hearing.

Dajani handed a handgun to Hooser, who thought it had been cleared and pulled the trigger as he held it to the young woman's head. The two GIs then lied to investigators, claiming that Luma had shot herself.

The woman had worked as a translator for The Washington Post daily before taking a job with the military.

Several US soldiers have been sentenced or are awaiting court martial in Iraq for their role in the killing of Iraqis. The scandal over abuse of prisoners at Abu Ghraib jail by US troops has also sparked widespread outrage. 

ENGLEWOOD CLIFFS, N.J. - The rain is turning to snow on a blustery January morning, and all the men gathered in a parking lot here surely would prefer to be inside. But the weather couldn't matter less to the robotic sharpshooter they are here to watch as it splashes through puddles, the barrel of its machine gun pointing the way like Pinocchio's nose. The Army is preparing to send 18 of these remote-controlled robotic warriors to fight in Iraq beginning in March or April.

Made by a small Massachusetts company, the SWORDS, short for Special Weapons Observation Reconnaissance Detection Systems, will be the first armed robotic vehicles to see combat, years ahead of the larger Future Combat System vehicles currently under development by big defense contractors such as Lockheed Martin and General Dynamics Corp.

It's easy to humanize the SWORDS (a tendency robotics researchers say is only human) as it moves out of the flashy lobby of an office building and into the cold with nary a shiver.

Military officials like to compare the roughly three-foot-high robots favorably to human soldiers: They don't need to be trained, fed or clothed. They can be boxed up and warehoused between wars. They never complain. And there are no letters to write home if they meet their demise in battle.

But officials are quick to point out that these are not the autonomous killer robots of science fiction. A SWORDS robot shoots only when its human operator presses a button after identifying a target on video shot by the robot's cameras.

"The only difference is that his weapon is not at his shoulder, it's up to half a mile a way," said Bob Quinn, general manager of Talon robots for Foster-Miller Inc., the Waltham, Mass., company that makes the SWORDS. As one Marine fresh out of boot camp told Quinn upon seeing the robot: "This is my invisibility cloak."

Quinn said it was a "bootstrap development process" to convert a Talon robot, which has been in military service since 2000, from its main mission - defusing roadside bombs in Iraq- into the gunslinging SWORDS.

It was a joint development process between the Army and Foster-Miller, a robotics firm bought in November by QinetiQ Group PLC, which is a partnership between the British Ministry of Defence and the Washington holding company The Carlyle Group.

Army officials and employees of the robotics firm heard from soldiers "who said 'My brothers are being killed out here. We love the EOD (explosive ordnance disposal), but let's put some weapons on it,'" said Quinn.

Working with soldiers and engineers at Picatinny Arsenal in New Jersey, it took just six months and only about $2 million in development money to outfit a Talon with weapons, according to Quinn and Anthony Sebasto, a technology manager at Picatinny.

The Talon had already proven itself to be pretty rugged. One was blown off the roof of a Humvee and into a nearby river by a roadside bomb in Iraq. Soldiers simply opened its shrapnel-pocked control unit and drove the robot out of the river, according to Quinn.

The $200,000, armed version will carry standard-issue Squad Automatic Weapons, either the M249, which fires 5.56-millimeter rounds at a rate of 750 per minute, or the M240, which can fire about 700 to 1,000 7.62-millimeter rounds per minute. The SWORDS can fire about 300 rounds using the M240 and about 350 rounds using the M249 before needing to reload.

All its optics equipment - the four cameras, night vision and zoom lenses - were already in the Army's inventory.

"It's important to stress that not everything has to be super high tech," said Sebasto. "You can integrate existing componentry and create a revolutionary capability."

The SWORDS in the parking lot at the headquarters of the cable news station CNBC had just finished showing off for the cameras, climbing stairs, scooting between cubicles, even broadcasting some of its video on the air.

Its developers say its tracks, like those on a tank, can overcome rock piles and barbed wire, though it needs a ride to travel faster than 4 mph.

Running on lithium ion batteries, it can operate for 1 to 4 hours at a time, depending on the mission. Operators work the robot using a 30-pound control unit which has two joysticks, a handful of buttons and a video screen. Quinn says that may eventually be replaced by a "Gameboy" type of controller hooked up to virtual reality goggles.

The Army has been testing it over the past year at Picatinny and the Aberdeen Proving Grounds in Maryland to ensure it won't malfunction and can stand up to radio jammers and other countermeasures. (Sebasto wouldn't comment on what happens if the robot and its controller fall into enemy hands.)

Its developers say the SWORDS not only allows its operators to fire at enemies without exposing themselves to return fire, but also can make them more accurate.

A typical soldier who could hit a target the size of a basketball from 300 meters away could hit a target the size of a nickel with the SWORDS, according Quinn.

The better accuracy stems largely from the fact that its gun is mounted on a stable platform and fired electronically, rather than by a soldier's hands, according to Staff Sgt. Santiago Tordillos of the EOD Technology Directorate at Picatinny. Gone are such issues as trigger recoil, anticipation problems, and pausing the breathing cycle while aiming a weapon.

"It eliminates the majority of shooting errors you would have," said Tordillos.

Chances are good the SWORDS will get even more deadly in the future. It has been tested with the larger .50 caliber machine guns as well as rocket and grenade launchers - even an experimental weapon made by the Australian company Metal Storm LLC that packs multiple rocket rounds into a single barrel, allowing for much more rapid firing.

"We've fired 70 shots at Picatinny and we were 70 for 70 hitting the bull's-eye," said Sebasto, boasting of the arsenal's success with a Vietnam-era rocket launcher mounted on a SWORDS.

There are bound to be many eyes watching SWORDS as it heads to battle. Its tracks will one day be followed by the larger vehicles of the Future Combat System, such as six-wheel-drive MULE under development by Lockheed Martin, a 2.5-ton vehicle with motors in each wheel hub to make it more likely to survive.

The Pentagon's research arm, the Defense Advanced Research Projects Agency, also recently awarded contracts to aid research of robots that one day could be dropped into combat from airplanes and others meant to scale walls using electrostatic energy - also known as "static cling."

Many of the vehicles being developed for the FCS will have some autonomy, meaning they'll navigate rough terrain, avoid obstacles and make decisions about certain tasks on their own.

They may be able to offer cues to their operators when potential foes are near, but it's doubtful any of them will ever be allowed to make the decision to pull the trigger, according to Jim Lowrie, president of Perceptek Inc., a Littleton, Colo., firm that is developing robotics systems for the military.

"For the foreseeable future, there always will be a person in the loop who makes the decision on friend or foe. That's a hard problem to determine autonomously," said Lowrie.

WASHINGTON - Somewhere in the shadows of the White House and the Capitol this week, a small group of super-secret commandos stood ready with state-of-the-art weaponry to swing into action to protect the presidency, a task that has never been fully revealed before.

As part of the extraordinary army of 13,000 troops, police officers and federal agents marshaled to secure the inauguration, these elite forces were poised to act under a 1997 program that was updated and enhanced after the Sept. 11 attacks, but nonetheless departs from how the military has historically been used on American soil.

These commandos, operating under a secret counterterrorism program code-named Power Geyser, were mentioned publicly for the first time this week on a Web site for a new book, "Code Names: Deciphering U.S. Military Plans, Programs and Operation in the 9/11 World," (Steerforth Press). The book was written by William M. Arkin, a former intelligence analyst for the Army.

The precise number of these Special Operations forces in Washington this week is highly classified, but military officials say the number is very small. The special-missions units belong to the Joint Special Operations Command, a secretive command based at Fort Bragg, N.C., whose elements include the Army unit Delta Force.

In the past, the command has also provided support to domestic law enforcement agencies during high-risk events like the Olympics and political party conventions, according to the Web site of GlobalSecurity.org, a research organization in Alexandria, Va.

The role of the armed forces in the United States has been a contentious issue for more than a century. The Posse Comitatus Act of 1878, which restricts military forces from performing domestic law enforcement duties, like policing, was enacted after the Civil War in response to the perceived misuse of federal troops who were policing in the South.

Over the years, the law has been amended to allow the military to lend equipment to federal, state and local authorities; assist federal agencies in drug interdiction; protect national parks; and execute quarantine and certain health laws. About 5,000 federal troops supported civilian agencies at the Winter Olympics in Salt Lake City three years ago.

Since Sept. 11, however, military and law enforcement agencies have worked much more closely not only to help detect and defeat any possible attack, including from unconventional weapons, but also to assure the continuity of the federal government in case of cataclysmic disaster.

The commandos here this week were the same type of Special Operations forces who are hunting top insurgents in Iraq and Osama bin Laden in the mountainous wilds of Afghanistan and Pakistan. But under the top-secret military plan, they are also conducting counterterrorism missions in support of civilian agencies in the United States.

"They bring unique military and technical capabilities that often are centered around potential W.M.D. events," said a senior military official who has been briefed on the units' operations.

A civil liberties advocate who was told about the program by a reporter said that he had no objections to the program as described to him because its scope appeared to be limited to supporting the counterterrorism efforts of civilian authorities.

Mr. Arkin, in the online supplement to his book (codenames.org/documents.html), says the contingency plan, called JCS Conplan 0300-97, calls for "special-mission units in extra-legal missions to combat terrorism in the United States" based on top-secret orders that are managed by the military's Joint Staff and coordinated with the military's Special Operations Command and Northern Command, which is the lead military headquarters for domestic defense.

Mr. Arkin provided The New York Times with briefing slides prepared by the Northern Command, detailing the plan and outlining the military's preparations for the inauguration.

Three senior Defense Department and Bush administration officials confirmed the existence of the plan and mission, but disputed Mr. Arkin's characterization of the mission as "extra-legal."

One of the officials said the units operated in the United States under "special authority" from either the president or the secretary of defense.

Washington: A Bush Administration campaign to replace the head of the United Nations nuclear watchdog agency faltered after all 15 countries approached by US diplomats, including Britain, Canada and Australia, refused to support the plan, US officials say.

The White House had hoped at least one of the three English-speaking allies would agree to block Mohamed ElBaradei from a third term as director-general of the International Atomic Energy Agency.

But with the US proposing no other candidate, no country was willing to turn against Dr ElBaradei, who is admired within the agency for his willingness to challenge the US Administration's policies on Iraq and Iran.

That same willingness has put Dr ElBaradei deeply at odds with the White House and became the driving factor in efforts to replace him, US officials said.

"It's on hold right now," said one US policymaker who was involved in lobbying against Dr ElBaradei. "Everyone turned us down, even the Brits." A British official confirmed that account, saying: "We can certainly live with another ElBaradei term."

US diplomats had tried to coax several people into challenging Dr ElBaradei, including Australia's Foreign Minister, Alexander Downer, but no one was willing to stand against the 62-year-old Egyptian diplomat, who was asked by a majority of members of his agency's board to stay on for another five years.

There is still hope among some US officials that an Argentinian nuclear specialist will stand, although the deadline for submissions passed on December 31.

"The emergence of a new candidate could encourage members to oppose ElBaradei," another US official said.

Aban Contractor reports: A spokeswoman said the Department of Foreign Affairs had not determined a position on Dr ElBaradei's candidature. "[But] we do support the two-term principle with very few exceptions."

A spokesman for Mr Downer said he knew nothing about the reported developments. "I'm not interested in commenting on that sort of media speculation."

Most of the Iraqi capital - particularly the western districts - has been without water for the past seven days.

Added to a lack of electricity - the national grid is off more than it is on - a crumbling mobile phone network, endless lines to get fuel and a daily dose of bombs and mortars, it has made it next to impossible to even think about the coming election.

"This is everyone's biggest problem," according to Alaa al-Din Saad, 32, a father of two who lives in the southwest district of Saidiya.

"We haven't had water for nearly a week. We used up all our reserves and now I haven't had a shower for three days."

Iraq's national election, just seven days away and expected to bring its own set of problems amid fears of a surge in violence, has taken a back seat to the need to find a water source in a country that is mostly desert but also has two of the world's major rivers.

No explanation

There has been no explanation for the crisis, which has provoked such anger and frustration that one Iraqi called a news agency demanding that something be done.

Fighters are suspected of attacking water mains outside the city several days ago, cutting off supplies, but the US military had no immediate information on such an attack.

In the absence of hard information, rumour and speculation often run riot in Iraq.

Some Baghdad residents say the Iraqi government and US military have cut off the water on purpose to frustrate people and prompt them to vote in the 30 January election.

Others take the water shortage as yet another sign that the US invasion has brought them nothing but problems.

'Nothing works'

"Nothing works - there's no power, no water, no fuel, no phone service. It's a disaster," according to Namidh, a security guard who said his family had been without water for a week. [...]

A spokesman for the public works ministry had no explanation for the crisis and referred callers to the mayor's office. No one was available at Baghdad city hall during the Muslim religious holiday of Eid al-Adha.

In some areas there is absolutely no water; in others, there is a trickle for a few hours a day.

The crisis has left many families unable to cook, wash clothes or bathe.

Some have taken to digging wells in the back garden in the hope of striking water. Those who get lucky are now supplying the neighbourhood. "People are lined up all day to get water from our well," Badia Yasin, a driver, said.

Stomach problems

A police source said about 300 people were taken to the hospital in west Baghdad this week with stomach problems and similar ailments and complaining of having been poisoned.

But officials at al-Yarmuk hospital, one of Baghdad's main clinics, said they had had no major increase in patients suffering from water-borne diseases such as cholera. Other hospitals were not immediately contactable for comment.

A health ministry official played down fears of a cholera outbreak but said disease could rise if the water crisis is not resolved soon. "There will be health problems if we don't sort this out," he said.

NASIRIYAH, Iraq - Fire swept through the general hospital in this southern Iraqi city early Sunday, killing 14 people and injuring 75, said a spokesman for the Italian military forces based in the city.

The blaze at the Nasiriyah General Hospital was believed to have been caused by an electrical fault, the fire department said.

The injured were transferred to another hospital in the city, about 200 miles southeast of Baghdad.

Col. Francesco Tirino, a spokesman for the Italian contingent in Nasiriyah, said that 14 people died and 75 were injured.

The Italians received an emergency call around 2 a.m., shortly after the fire broke out. The blaze was extinguished four hours later, Tirino said, and the Italians returned to their base.

Most of the injured were taken to a pediatric hospital in Nasiriyah, while three, who were in serious condition, were taken to a field hospital run by the Italians.

Italy has around 3,000 troops based in Nasiriyah as part of the U.S.-led coalition in Iraq.

During January 20 inauguration coverage, hosts and commentators on CNN, MSNBC, and FOX News ridiculed inauguration protesters; downplayed their numbers and significance; and implied that they posed a security threat.

CNN host Wolf Blitzer seemed to ignore fellow host Judy Woodruff's point that parade watchers generally had to pay for seats (and therefore likely supported President Bush), asserting that in contrast with the protesters -- whom he called "angry, angry people" -- "there are a lot more people who have gathered along Pennsylvania Avenue who love this president."

Later, Blitzer again downplayed the protesters' significance: "And we don't want to make too much of the protesters, because we don't know how many there were. Certainly, the nature of this business, the nature of television, we could over-exaggerate based on the images, and they might just be a tiny, tiny overall number." A January 21 New York Times article rebutted Blitzer's assessment, noting that the number of protesters in the protest-designated space alone was in the "thousands," and that there were also protesters interspersed with Bush supporters throughout the parade route: "The numbers of protesters along Pennsylvania Avenue might have been greater, but the swarm of people trying to pass through security checkpoints made it hard to reach the parade route quickly."

As the Bushes' limousine passed the designated protester area, CNN guest and Harvard University historian Barbara Kellerman remarked: "I doubt very much they [the Bushes] are taking the protesters very seriously at this point. I think they are celebrating the moment. And I must say, who can blame them?"

On FOX News, homeland defense correspondent Catherine Herridge also downplayed the number of protesters, stating that of those associated with the protest coalition Act Now to Stop War and End Racism (ANSWER) "only a few dozen people have shown up." But The New York Times reported that the ANSWER-led coalition "filled [the protest-designated space] with thousands of people who were as close to Mr. Bush as those who came to cheer him."

HERRIDGE: This is the designated site for an anti-war group that's called ANSWER. That's an acronym for Act Now to Stop War and End Racism. This has been billed as the largest demonstration. It's sort of early days, but you can see with your own eyes that only a few dozen people have shown up. ANSWER had told the park police they were expecting somewhere in the area of 10,000. While they're demonstrating against the administration's policies -- both domestic and foreign -- there are groups today that will be demonstrating in support of the president. The D.C. chapter of [conservative online forum] Free Republic will be here supporting the president and also our troops overseas, and they told the park police they were expecting somewhere around 1,000 people.

Later, FOX News host, managing editor, and chief Washington correspondent Brit Hume, observing the presidential motorcade leaving the White House on its way to the Capitol, called the protesters not "very important":

HUME: We'll keep an eye out as well for protesters along the way. They've been granted more access in some cases than is usual to the spots along Pennsylvania Avenue. So we'll keep an eye out for any of that. It isn't very important, but it's kind of interesting, and it's sort of typical of this country that you'd have this grand celebration of the second term of a new president, and dissenting voices have a spot in all of it.

On CNN, national correspondent Bob Franken linked increased security to the protesters:

Of course, the inauguration brings with it pageantry. But since September 11, 2001, it has met intense, unbelievable security and an angry nation. The protesters are set up in various spots. One of the authorized ones is right in back of me. ... The police forces are probably going to outnumber the demonstrators. They are part of a security effort -- most of which we're seeing, highly visible, some of which we're not -- which is designed to allow this to be a national security event that becomes a celebration, as opposed to something that would be unthinkable.

On MSNBC, Washington Times editorial page editor Tony Blankley ridiculed animal rights organization People for the Ethical Treatment of Animals (PETA), calling them, "People Eating Tasty Animals." Blankley's comment came as he, MSNBC host Chris Matthews, and MSNBC contributor and analyst Monica Crowley discussed the fur coats some wore to inaugural events:

MATTHEWS: I guess there's no -- what do they call it, PETA? -- they're not around.

CROWLEY: And I like all the fur-lined Stetsons.

BLANKLEY: PETA, isn't that People Eating Tasty Animals?

MATTHEWS: I don't think so at all. I'd be very careful, Tony

Comment: Note how the Fox news reporters completely denigrate the fact that there were thousands of protestors at the inauguration in Washington while at the same time lauding the fact that they are allowed to protest as if it were some wonderful example of democracy. The point is that the extremely biased nature of the mainstream US media and the way in which its representatives deliberately malign and ridicule any opposition to Bush, renders the "right to free speech" impotent.

TAMPA - Two former WTVT, Channel 13, reporters filed a petition Monday with the Federal Communications Commission to deny renewal of the station's license for "intentionally airing false and distorted news reports'' in 1997.

Jane Akre and Steve Wilson, who worked for Channel 13 in 1996 to 1997, say the station violated the public trust by ordering them to put a favorable slant on news reports they were preparing about a growth hormone given to dairy cattle in Florida.

The married couple, who now live in Jacksonville, say Fox-owned WTVT feared a lawsuit from hormone maker Monsanto because their reports would have raised questions about health hazards.

The couple say they refused to alter the story and were fired. The station eventually aired a growth hormone story which the couple says contained "lies and distortions.''

They have been in a legal battle with WTVT ever since.

"We had to wait until now to challenge because licenses only come up for renewal every eight years,'' Akre said.

"The FCC has said that rigging or slanting the news is a most heinous act against the public interest,'' Wilson said. "If the FCC is concerned about obscenity, there is nothing more obscene than lying to the public.''

WTVT officials deny the charges and are preparing an answer to the petition, said Channel 13 Vice President and General Manager Robert Linger.

Linger called the petition "an attempt to re-litigate something that has already been tried in court.''

The couple filed a civil lawsuit in 1997 against WTVT, claiming they were wrongfully fired over the story. The station said they were fired because of insubordination.

In August 2000, a jury awarded Akre $425,000, saying the station retaliated against her for threatening to blow the whistle. The jury said Wilson, who is now a reporter for a Detroit TV station, had not been wronged.

In 2003, a state appeals court overturned the jury award, saying that Akre failed to show that WTVT had violated any state laws. Wilson contends that, in effect, the court found that it's not against the law to distort the news. It is a violation of FCC rules, he says. ``We're not re-trying the case ... we have a duty to bring Fox's misconduct to the FCC which promised to protect the public interest.''

The station has 30 days to respond and an FCC investigation could last for months, an FCC spokesman said.

PARIS - Representatives of France's biggest media outlets are to hold a meeting next Monday to discuss ways of pooling efforts in covering Iraq to minimise the rising risks journalists in the conflict-torn country are exposed to.

The gathering is to take place at the Paris headquarters of the Liberation newspaper, whose correspondent in Iraq, Florence Aubenas, went missing two weeks ago with her Iraqi interpreter.

"It is a working meeting of news directors of all broadcasters - television and radio - from the public and private sectors, the national daily press and magazines" and news agencies, including AFP, Liberation editor-in-chief Serge July said Friday.

He said the aim was to boost the solidarity around Aubenas and "think about how to cover Iraq" by raising the possibility of pooling resources.

Abbas seeks pledge from Sharon to win lasting ceasefire

Hamas and Islamic Jihad have agreed to suspend attacks on Israel in order to give the new Palestinian leader, Mahmoud Abbas, time to secure international guarantees for a comprehensive ceasefire that would end more than four years of intifada.

Mr Abbas told Palestinian television yesterday that it was "essential" that Israel reciprocate by ending its targeting of armed Islamist groups. He said he had made "significant" progress in talks with Hamas and Islamic Jihad and expected to reach a comprehensive agreement with them soon on an array of political and security issues that would effectively end their war on Israel.

Mr Abbas's principal negotiator with Hamas, Ziad Abu-Amr, yesterday said the armed Islamist factions pledged to hold off from attacks while the Palestinian leader attempted to secure assurances of Israeli reciprocity, and negotiates final terms of a deal to bring the groups into the political process.

"There is a Palestinian tranquillisation. This is a Palestinian initiative intended to be a prelude to a ceasefire but there have to be conditions for a ceasefire," said Mr Abu-Amr. "There has to be reciprocity [from Israel] and that means no attacks on Palestinians, no incursions or chasing militants."

The Israeli prime minister, Ariel Sharon, has said "quiet will be met with quiet". But the army chief of staff, Lieutenant General Moshe Ya'alon, told the Israeli cabinet yesterday that the military would continue operations against Palestinian militants in those areas where Palestinian security forces are not operating, which includes much of the West Bank.

Mr Sharon remained in a threatening mood yesterday after moving his weekly cabinet meeting to the Israeli town of Sderot where a 17-year-old girl died last week after being hit by shrapnel from a Hamas rocket as she shielded her younger brother.

"We do not know whether a real change has occurred in the situation. We hope so," said Mr Sharon. "One thing is clear. If the terrorism resumes, we shall act according to a cabinet decision that has been taken [to attack Gaza]".

Mr Abbas is expected to leave Gaza City this morning after five days of negotiations with the Islamist groups and ahead of a planned visit to Europe to seek foreign, particularly American, involvement in securing commitments from Israel. The Palestinian leader wants to put a halt to Palestinian violence as a test of the Israeli government's commitment to resume negotiations if the conflict ends.

"It's important that the Palestinians come up with a position that throws the ball into the Israeli court," said Mr Abu-Amr. "If the Israelis don't want to reciprocate, there won't be a ceasefire. If the Israelis continue with their same rules of engagement, the ceasefire can't continue. What counts is the substance."

Washington's Middle East special envoy, William Burns, is expected in Jerusalem, Ramallah and Cairo next week. A US official said he would be lending American weight to any understandings between Mr Abbas and the Islamist groups that end the attacks on Israel.

The Palestinians also want the US to monitor Israeli actions to ensure that Mr Sharon does not use relatively small breaches of the ceasefire, perhaps by renegade Palestinian factions, as a pretext to resume attacks on the Gaza strip.

The Israeli army carried out raids on Saturday night in which four wanted Palestinian men were arrested in Nablus and near Hebron. The military's continued detention of Palestinians, and more specifically their killing when they resisted arrest, was an important factor in the collapse of a 2003 ceasefire after 51 days.

Mr Abu-Amr said he believes the Israeli prime minister has a short-term political interest in dampening down the violence because he does not want to carry out his plan to pull Jewish settlers out of the Gaza Strip under fire, which would appear as a victory for Hamas. But he remains sceptical about Israeli intent.

"I know how they dealt with [Mr Abbas] when he was prime minister [in 2003]. It's not that they didn't help him, it's that they undermined him. Sharon didn't want negotiations then. I'm not sure he wants to negotiate now."

Comment: Now all that remains is for Israel to respond to this effort to establish peace with the Palestinians...

Israeli Finance Minister Benjamin Netanyahu said Monday that Israel need not grant Palestinian President Mahmoud Abbas “anything” in return for a cease-fire.

In an interview with Palestine TV, Abbas said on Sunday he was close to a cease-fire deal with Palestinian resistance groups.

"The dialogue is making very good progress. The differences have narrowed greatly and therefore I can say that we are bound to reach an agreement very soon," Abbas said.

Israeli Prime Minister Ariel Sharon and his Defense Minister Shaul Mofaz said Sunday that Israel, for its part, was willing to suspend operations against Palestinians if they end their attacks on Israeli targets.

Speaking to Israel Army Radio from Florida, Netanyahu tuned down the significance of a truce, criticizing senior army officers for pre-maturely praising Abbas.

"A truce can be an opening for a positive development, or a time-out between two offensives of terrorism.” He said.

“If Abu Mazen and his government begin dismantling the “terror” organizations, confiscate their weapons, then we'll know we are in the right direction.” He added.

Relative quiet continued in the Gaza strip, providing Abbas with a suitable environment to peruse his dialogue with resistance groups.

"As things stand now, I cannot say that an agreement has been achieved, but God-willing it should come," Abbas told Palestine TV.

Abbas stressed that Israel had "many responsibilities" to carry out for a truce to work, including ending raids to detain wanted militants and releasing Palestinian prisoners.

Many resistance leaders signaled they would agree to maintain calm in Gaza for at least a month, but denied they had committed to a formal cease-fire.

"There can be no truce without clear Israeli commitments to stop all forms of aggression against our Palestinian people and fulfill all (our) demands ... fore mostly, the release of prisoners," said Sami Abu Zuhri, a Hamas spokesman in Gaza.

Comment: Shock? Surprise? Hardly. As we have been saying for years, the last thing that Israel wants is peace with the Palestinians. On the contrary, it would appear that the plan is to continue to stoke the fires of conflict while simultaneously manipulating Jews around the world to return to Israel for the "grand finale"...

"We always thought about moving to Israel, but the environment in France now has pushed us to find the courage to do it," said shipping broker Harry Ouaknine, as he read about Tel Aviv high schools at a one-day Israel immigration show in Paris, known as Aliya Day.

He, his wife and two school-aged daughters live on a houseboat in western Paris on the Seine River. They came to France as youngsters from Morocco and Tunisia respectively, eat kosher food and go to synagogue every Friday.

They have successful professional and family lives in Paris, but are beginning to worry about the future.

"Honestly, the anti-Semitic violence has not touched us directly, but it is scaring us enough to believe we have no future as Jews in Paris," said his wife, Murielle, an IT operator. "We want to construct our futures in Israel, no longer in France."

They were looking at schools, job opportunities and housing possibilities at the dozens of stands at the Aliya Day at the France-Israel Centre, organized in January by the Jewish Agency, the Israeli organization that organizes non-governmental activities in Jewish communities.

Making 'Aliya', or moving up to Israel in Hebrew, has become a buzzword among the estimated 600,000 Jews living in France, the third largest Jewish community in the world after Israel and the United States, and the biggest in Europe.

Unofficial figures put the number of immigrants to Israel from France at about 2,500 in 2004. Aliya Day was attended by some 4,350 people, the highest figure ever, according to David Roche, director of the Jewish Agency in France.

The Chief Rabbi in France, Joseph Sitruk, even offered a blessing to those leaving, saying, "Nobody is running away from France. People create their own spiritual conditions for going."

A report from the French interior ministry in December said racist violence including anti-Semitism had increased by over 70 percent in 2004, with 194 reported acts and 711 threats, compared to 112 acts and 418 threats over the same period in 2003.

The ministry said it was concerned about "a considerable number of incidents of sacrilege and acts aimed at places of worship, whether Christian .... Jewish or Muslim."

There had been a reported 92 such violations of Christian churches, 31 of Jewish synagogues and 28 of Muslim mosques.

Last year Israeli Prime Minister Ariel Sharon sparked a controversy with France after he urged all French Jews to leave the country immediately to avoid what he called "the wildest anti-Semitism".

But Roche said the French government has been doing a good job in the fight against anti-Semitic attacks.

French President Jacques Chirac and the former interior minister Nicolas Sarkozy "have taken strong positions, saying no violence will be tolerated," he said, "but still, the courts could be doing more. And frankly, many people in France are simply not interested in the problem."

Seventeen-year-old Rebecca Cohen, from a north-eastern Parisian suburb, was looking at high schools in Jerusalem. "I have Muslim Arab friends," she said, "but I have been called a dirty Jew by other Arabs in school more than once, more than twice. I was born here, but I am fed up."

"Whatever measures the French government takes, it is difficult to prosecute 15-year-olds, and the French people could not care less about this problem, as long as it does not affect them directly."

Going to live in an explosive situation between Israelis and Palestinians did not scare her. "The Palestinians need a state," she said. "They are hard working people but are faced with a political problem."

"Here in France, the overall system has been very good for French people and for many immigrants, but some Magrebis have been unable to integrate. The result is violence against us. You can't imagine how many Jewish teenagers are talking about leaving for Israel."

A few people were interested in moving to the United States, where Miami is becoming a favourite destination.

"Before, I was interested in the States, but then I joined a Jewish youth group here in Paris," said Eve-Anne Grynsztajn, aged 21, "and now my file is already waiting to be processed to go to Israel."

A FRENCH woman who lied about being the victim of a vicious anti-Semitic attack - a claim that sparked nationwide outrage - has been handed a four-month suspended sentence.

Marie-Leonie Leblanc, 23, was also given two years' probation and ordered to get psychiatric treatment for "reporting an imaginary crime" after falsely telling police she had been assaulted on a suburban Paris train on July 9.

The criminal court in Cergy-Pontoise, northwest of Paris, also ordered Leblanc to pay a symbolic 1 euro ($1.70) in damages to the French national railway SNCF in what presiding judge Jean Idrac called a "warning sentence".

The woman initially told police a gang of six Arab and black youths had slashed her clothes, cut a lock of her hair and drawn swastikas on her stomach after mistaking her for a Jew.

She also said the youths had tipped over her baby carriage with her 13-month- old daughter inside. [...]

But the lie quickly unravelled when no witnesses came forward to back her story and closed-circuit video cameras in the station where Leblanc said the youths had left the train did not show any trace of the supposed gang.

The Israeli government has released figures showing that 47 percent of antisemitic incidents in Western Europe take place in France, according to a report in Le Monde.

The figures, released yesterday (25 January) also showed that while global incidents in general have almost halved, they have almost doubled in France in the past year.

There were 983 incidents of antisemitism in 2003 - a sharp decline from 1,979 in 2002. The downward trend is reflected in the UK (107 incidents compared to 114) and the US (40 incidents, down from 45 last year).

However, in France, the figure has almost doubled from 77 to 141.

Presenting the figures in Jerusalem, Israeli minister Nathan Chtcharansky said, "The situation for Jews in France is very problematic. Last year, the number of antisemitic incidents doubled and 47 percent of antisemitic attacks in Western Europe took place in France". [...]

[...] France dismissed Israeli charges of rising anti-Semitism yesterday, saying attacks on Jews and Jewish property had dropped by 36 per cent last year rather than doubled as Natan Sharansky, the Israeli minister for diaspora affairs claimed. He said 47 per cent of all anti-Semitic attacks in Europe last year were in France, a jump to 141 from 77 in 2002. [...]

In less than a month, Israeli soldiers shot three handicapped residents in the northern West Bank city of Qalqilia and the surrounding villages killing one and injuring two others.

On Saturday, Israeli soldiers killed Taqi Ad-Deen Al-Khouli, 17, in the village of Azzoun, near Qalqilia, after claiming that he was in an area near the annexation Wall; Al-Khouli was suffering of metal disability.

The Israeli army claims that Al-Khouli was trying to cut sections of the fence, in an area where the concrete annexation wall is not constructed yet. The army spokesperson also stated that Al-Khouli was shot by direct military order.

Two weeks ago, Israeli soldiers shot Hatem Odeh, 50, and Raed Sa’sa’, 27, both from Qalqilia, and suffering of physical disabilities.

Sa’sa’ was seriously injured to his abdomen and was transferred by the soldiers to an Israeli hospital.

Human Rights organizations in the West Bank said that the repeated incident of injuries and deaths among the residents, especially the handicapped reveals that the army is acting without any restrictions or limitations.

You live in a home in a city, your home is inherited through generations within your family, you never sold your home, you never left your home or your city, yet your home isn't yours anymore.

This is the exact meaning of implementing the Absentee property law in East Jerusalem.

On July 2004, decided in secrecy to implement the Absentee property law in East Jerusalem. In January 2005, the decision was published.

In the year 1950, Two years after the creation of the state of Israel, the government of Israel approved the Absentee property law, which states that any person who has not been living inside "Israel" by the day of announcing the creation of the state of Israel, is considered an Absentee who is not entitled to property ownership rights, and that his property is transferred to the "custodian of absentees' property" for distribution to Israeli Jewish families.

The purpose of such a law, which stands as most discriminatory and most anti-civil and individual rights, was to lay hand on and distribute the property of around one million Palestinians who were displaced during the 1948 war.

In practice, Israel became a state that established property rights based on robbery of land and property owned by others.

What took place in 1950 and hence after inside Israel is being repeated in the year 2005, this time in East Jerusalem.

Israel occupied East Jerusalem in the year 1967. Few months later, East Jerusalem and thousands of dunams of land around it were annexed. The ownership of the annexed area is almost evenly divided between residents of Jerusalem and residents of adjacent cities and towns.

The immediate consequence of implementing the Absentees property law is laying hand on land and property owned by Palestinians living in other areas of the West bank. Yet, and as this area of full of surprises, it won't be strange for Israel to use the law to force families living in their homes in East Jerusalem to leave and distribute their homes to Jewish families.

With the exception of few voices from the side of Israeli left groups, all the defenders of "liberty", "freedom", Human and civil rights" are deadly silent.

More surprising is the silence of the Palestinian Authority, which is busy enforcing law and order in the Gaza Strip.

Could anyone imagine this happening to him? Your home, say in New York, is taken by law and given free of charge to someone who belongs to a different ethnic group.

What is the deal here? Are Palestinians requested to accept the sate of Israel or have to accept the most viscous, inhuman, criminal law ever invented in the modern history of humanity?

How is this criminal law related to "security" or the fight against "terror"?
The Israeli current government has exposed its ugliest face by approving the implementation of the Absentees property law. Can any of the defenders of democracy and human rights, or the ones who join the coral of "moral democratic Israel " look directly to the eyes of families who lost their land and property and explain?

The United States government is attempting to dismiss a lawsuit brought by Syrian-Canadian Maher Arar, claiming the litigation would jeopardize national security.

Invoking the rarely used "state secrets privilege," U.S. Department of Justice lawyers filed a motion with the New York eastern district court this week, stating that the release of any information concerning the U.S.'s involvement in Arar's deportation to Syria could jeopardize "intelligence, foreign policy and national security interests of the United States."

Lawyers with New York's Centre for Constitutional Rights, who filed the lawsuit on Arar's behalf a year ago, said the government is abusing claims of national security in order to avoid a review of its policies and handling of terrorism suspects.

"They're asking the court to sanction their cover-up basically," lawyer Maria LaHood said yesterday.

Arar was detained by immigration officials at New York's JFK airport on Sept. 26, 2002, and subsequently held as a terrorism suspect in a Brooklyn jail, where he says he repeatedly asked to be sent back to Canada. On Oct. 8 he was flown on a private jet to Syria, via Jordan. Arar says he was tortured and held without charges for a year before returning to Canada.

The Centre for Constitutional Rights launched Arar's lawsuit last January alleging that former attorney-general John Ashcroft, former homeland security secretary Tom Ridge and other officials within President George W. Bush's administration knew Arar would be tortured when he was deported. Arar alleges he was a victim of the government's controversial policy of "extraordinary rendition," where American authorities can circumvent their own restraints on interrogations by sending suspects to countries that employ harsh tactics.

BOSTON — The revelation last week that a laboratory slip-up led three Boston University scientists to become infected with tularemia, a flulike disease sometimes referred to as "rabbit fever," has fueled criticism of a plan to build a state-of-the-art research lab to study some of the world's most lethal germs in Boston's South End.

The project, which is expected to bring more than $1.6 billion in grants and other funding to the city, has generated intense community opposition in the two years since Boston Medical Center began trying to persuade the federal government to site the project in Boston.

Slated for groundbreaking this year, it would be one of just a handful of full-scale biosafety level 4 (BSL-4) laboratories in the country, a classification that would permit research on diseases such as anthrax, Ebola and the plague. The lab would be located in a more densely populated neighborhood than the others, including those in San Antonio, Atlanta and Frederick, Md.

The Boston Globe reported Wednesday that two researchers became sick in May with a mysterious illness later diagnosed as tularemia, and that a third case emerged in September. The illnesses occurred when the scientists worked with what they believed to be a safe form of the disease. They have since recovered.

The university, which has long insisted exhaustive security procedures and technology would make the laboratory safe, did not disclose the contaminations until it was questioned by the newspaper, The Globe reported.

Local leaders, including some members of Boston's City Council who have long opposed the project on safety grounds, said the reports lent credibility to their concerns.

"They say that type of tularemia is not contagious from person to person, and that is why they didn't tell us, but what I am afraid of is that will happen with anthrax or smallpox, or something much worse," said Rose Aruda, a community organizer who lives several blocks from the large parking lot where the facility would be built.

In an attempt to delay final approval of the project, she and several other neighborhood residents filed a lawsuit Jan. 12 accusing the university of underestimating the potential "worst-case" scenario listed on its environmental impact forms.

The BSL-4 lab would join a network of new facilities, many developed after the Sept. 11, 2001, terrorist strikes and the subsequent anthrax mailings, that investigate agents that could be used in a biological terrorist attack. [...]

PORT CANAVERAL, Fla. (AP) - More than 250 passengers aboard a cruise ship fell ill with a stomach virus while touring the western Caribbean, cruise line officials said Saturday.

About 233 of the 3,465 passengers aboard the Mariner of the Seas became sick after the vessel left Port Canaveral on Jan. 16 for a seven-day cruise through the western Caribbean. The ship was expected to return early Sunday.

Twenty of the vessel's 1,190 crew members also showed symptoms.

Michael Sheehan, a spokesman for Royal Caribbean International, described the illness as "your typical 24-hour stomach virus and nothing more" and blamed a sick passenger for bringing it on board.

The Mariner of the Seas was also being checked for bacteria, the company said.

Passenger Crystal Wiles, an accountant from Frederick, Md., said in a phone interview from the vessel she and her husband had been quarantined for three days. She criticized the cruise line's handling of the illness and said the company was undercounting the number of people affected by the virus.

"The treatment has been horrible," Wiles said.

AT least 16 people were killed and several injured in northern Iran when a landslide caused a bus to crash into a valley.

The semi-official ISNA students' news agency today said 25 died and seven were injured in the accident in Mazandaran province, on the road between the capital Tehran and the Caspian Sea town of Babolsar.

However, state television, citing police Colonel Mohammad Khargh, said 16 died and eight were injured. Five were unharmed in the crash, it said.

New Delhi - General insurers appear to be apprehensive in settling claims of Tsunami-hit people, especially those relating to property loss, as they are undecided whether to treat the catastrophe as an earthquake or a flood.

"Tsunami is a new phenomena. It neither fits in the definition of flood or cyclone or earthquake but a combination of all these catastrophes," a senior insurer told PTI on conditions of anonimity.

General insurers are not ready to treat the disaster as a flood although most the damage caused to property and other tangible assets were due to the sudden gush of water from the sea that inundated the eastern coast line of the country.

The lack of clarity has created confusion among insurers who are not ready to settle the claims on property that are covered for floods but not insured against earthquake.

Tsunami, a tidal wave triggered by a major earthquake, has hit India for the first time in living memory. It took away thousands of lives and damaged property worth crores.

Government and insurance regulator IRDA have asked insurers to settle claims promptly by relaxing some norms. But insurers are yet to assess the extent of loss till now.

When contacted, GIC officials declined to hazard a guess on the possible damage and claims that may arise out of that.

So far, Tsunai was not covered specifically by Indian insurers. There is an apprehension among consumers that insurers may not fully settle the claims for property losses if they have not opted for earthquake cover.

Motor insurance, which covers flood, cyclone, storm and earthquake, are being settled promptly.

The Antara news agency reported the quake occurred at 11:16 local time (0416GMT), around four hours after a 5.2-magnitude quake jolted the province.

The epicenter was located 355 km northwest of provincial capital Banda Aceh, it quoted report from the local meteorology and geophysics agency.

There is no immediate report of casualty.

The 6.3-magnitude quake hit near the islands in the Bay of Bengal at 12.22pm (0422 GMT), the Hong Kong Observatory said.

The tremor’s epicentre was about 1,081 miles south east of Calcutta, the observatory said.

On December 26, a 9.0-magnitude quake and tsunami devastated South Asian countries. Between 162,530 and 228,771 people have been reported dead so far.

JAKARTA : A strong earthquake measuring 6.2 on the Richter Scale struck the Indonesian island of Sulawesi early Monday causing some damage to buildings, officials said.

The quake struck at 3:10 am (1910 GMT) under land roughly 16 kilometres (10 miles) south of the town of Palu, the capital of Central Sulawesi province, the meteorological and geophysics agency said.

Agency official Sutiono said eight shops were damaged but there were no reports of fatalities or serious casualties.

He said at least 24 aftershocks were recorded, with magnitudes ranging between 3.0 and 4.0 on the Richter scale.

NEW YORK - The northeastern United States was emerging from a snowstorm, ranked among the five worst in the past century, that was linked to at least 18 deaths across eight states.

The storm, which started in the midwest Friday, dumped 30 centimeters (a foot) of snow in Detroit, 35 centimeters (14 inches) in New York City, and close to a meter (more than three feet) in some parts of the state of Massachusetts.

At least 18 deaths in eight states were linked to the storm, including that of a ten-year-old girl struck by a snowplow as she played on a snowbank in New York, media reports said.

Five people collapsed while shoveling snow in New York, and one in Boston, apparently having suffered heart attacks, according to reports in The Washington Post and the New York Times.

Storm-related deaths were also reported in Ohio, Wisconsin, Connecticut, Pennsylvania, Maryland and Iowa.

The governors of Massachusetts, Rhode Island and New Jersey declared emergencies in their states, warning people to stay home to facilitate road clearance on Monday. Boston area schools were to be closed until Wednesday.

Boston's Logan International Airport remained closed early Monday. Thousands of flights were delayed or cancelled at airports in northeastern and midwestern US states as residents dug out from the first major snowstorm of the year.

"The blizzard of 2005 will go down in history as one of the five top snowstorms for eastern New England," said James Wilson, a meteorologist with The Weather Channel.

At one point Sunday, 20 centimeters (eight inches) of snow fell in 75 minutes in Chatham, Massachusetts, the channel said.

Authorities were warning of brutal cold Monday up and down the east coast from the Great Lakes region down to Florida, with high winds sending temperatures well below zero degrees Fahrenheit (minus 18 Celsius) in many areas.

Airlines were still dealing with the fallout of thousands of flight delays and cancellations over the weekend in Chicago, New York, Boston and smaller cities. [...]

British airports canceled 31 flights to and from the United States' northeast region, officials said in London on Sunday. London's main Heathrow airport canceled 29 arrivals and departures after heavy snowfall in New York, Boston and Philadelphia.

US authorities begged people to stay off the roads as high winds blowing snow produced whiteout conditions from New York to Maine, bringing normally congested cities to a standstill.

"Any travel is strongly discouraged," the National Weather Service warned Massachusetts residents early Sunday. "If you leave the safety of being indoors, you are putting your life at risk." [...]

Commuters have been warned to stay off the roads in north Queensland as the region battles widespread heavy downpours and flooding, which have already claimed two lives.

Two people were killed and three injured after a collision in wet conditions between two cars and a semi-trailer on the Bruce Highway at Yalarbo, north of Mackay, about 1.40pm (AEST) yesterday.

Elsewhere, a truck driver had to be rescued from the roof of his vehicle after becoming stuck in rising waters.

Several roads between Townsville and Mackay were closed, with the region experiencing up to 120 millimetres of rain in the eight hours to 5pm (AEST) yesterday.

A Townsville police spokesman said most roads in the region were closed and warned people not to travel unless absolutely essential. [...]

A powerful electrical storm lashed Sydney and central western NSW yesterday, setting a house on fire and leaving about 35,000 households without power.

In the Baulkham Hills suburb of Bella Vista, a lightning strike about 8am set a house on fire. Superintendent Ian Krimmer, of the NSW Fire Brigade, said the fire, in the roof of the two-storey house, was quickly brought under control.

In Hornsby and Castle Hill, unit residents had to be rescued from lifts affected by the power fluctuations. Power lines also came down at Penrith, Emu Plains and Blacktown.

In Coonabarabran, wind gusts of 119kmh were recorded, the highest in the state.

The Bureau of Meteorology's severe weather forecaster, James Taylor, said that in some areas of the western suburbs and the Blue Mountains, rainfalls were the heaviest in a decade or so. Willmot, near Penrith, received 45 millimetres of rain in an hour and Woodford, near Katoomba, received 42millimetres in just half an hour.

The heavy rain forced the suspension of a search for a canyoner swept away by rising waters in the Blue Mountains late the previous afternoon. The 32-year-old Sydney man became separated from a group he was canyoning with at Empress Falls, with heavy fog thwarting rescuers' initial search efforts.

Mr Taylor said big thunderstorms were common at this time of year. "The severe thunderstorm season is generally from about September through to the end of March," he said. [...]

TORONTO (CP) - A broken water main caused a power outage in the city's downtown core on Sunday, prompting the closure of stores and tourist attractions and leaving some residents without power for nearly 12 hours.

The City of Toronto opened Metro Hall for condo and apartment-dwellers left without heat as temperatures outside hovered well below freezing. Personnel from the Red Cross were on site.

Fire crews said they hoped to have power restored by 7 p.m., but added that frozen pipes could complicate repair efforts.

They were called to a water main leak at a downtown hydro power station at about 7 a.m. Sunday. Hydro crews shut off power before 9 a.m. after the water main caused flooding at the facility.

"We don't know the extent of the damage (of the leak)," Hydro One spokesman Alan Manchee told a news conference.

The ramifications of the outage would have been worse had it happened on a weekday, Manchee said, as it struck much of Toronto's financial district.

"I'm not sure you could say any time is a good time for an incident like this," he said. "(But) it's good that it happened today rather than a weekday."

Ryerson University and the Toronto Eaton Centre were shut down for the day and both were set to reopen Monday.

Manchee said crews would restore the power incrementally to avoid overloading the power system.

A FLOOD flood in Guyana has left five people dead as relief supplies trickle into thousands of affected villages in the South American nation.

The bodies of two men and a woman were found in three Atlantic coast villages severely affected by the week-old flood, police spokesman John Sauers said, raising the death toll from two to five.

President Bharrat Jagdeo said at least 2000 people were in 23 emergency shelters.

Food and dry rations were being delivered to affected communities where the now stagnant and polluted water was between 1.5 and 2.1 metres deep, Mr Jagdeo said.

More than three million Muslims - among them South Africans - on pilgrimage in Saudi Arabia are stranded in the desert following heavy rains on Sunday, SABC radio news reported.

South African Consulate-General Mohammed Dangor, who was in Jeddah said the pilgrims were stranded in a camp 40 kilometres outside Mecca.

Dangor said Mecca and Jeddah have recorded an above average rainfall this season. Last year, a stampede left scores of people dead.

Dangor has urged families and relatives of those who went on the pilgrimage not to panic as the situation was under control, SABC reported.

Dead are among 13-member family crammed into one vehicle which has tried to cross flooded valley.

RIYADH - Eight people were killed after being washed away by flood waters near the western city of Medina during the worst torrential storm to hit Saudi Arabia in 20 years, newspapers reported Monday.

The dead were among a 13-member family crammed into one vehicle which had tried to cross a flooded valley, Al-Watan newspaper said.

The vehicle was swept away and bodies found some 10 kilometres (six miles) away, the daily said, adding that one passenger was rescued while four others are still missing.

The English-language Arab News said many residents of Medina were forced to leave their homes after they were flooded while a dam outside the city collapsed, isolating villages where fire brigades rescued 43 stranded people. [...]

The global warming danger threshold for the world is clearly marked for the first time in an international report to be published tomorrow - and the bad news is, the world has nearly reached it already.

The countdown to climate-change catastrophe is spelt out by a task force of senior politicians, business leaders and academics from around the world - and it is remarkably brief. In as little as 10 years, or even less, their report indicates, the point of no return with global warming may have been reached.

The report, Meeting The Climate Challenge, is aimed at policymakers in every country, from national leaders down. It has been timed to coincide with Tony Blair's promised efforts to advance climate change policy in 2005 as chairman of both the G8 group of rich countries and the European Union.

And it breaks new ground by putting a figure - for the first time in such a high-level document - on the danger point of global warming, that is, the temperature rise beyond which the world would be irretrievably committed to disastrous changes. These could include widespread agricultural failure, water shortages and major droughts, increased disease, sea-level rise and the death of forests - with the added possibility of abrupt catastrophic events such as "runaway" global warming, the melting of the Greenland ice sheet, or the switching-off of the Gulf Stream.

The report says this point will be two degrees centigrade above the average world temperature prevailing in 1750 before the industrial revolution, when human activities - mainly the production of waste gases such as carbon dioxide (CO2), which retain the sun's heat in the atmosphere - first started to affect the climate. But it points out that global average temperature has already risen by 0.8 degrees since then, with more rises already in the pipeline - so the world has little more than a single degree of temperature latitude before the crucial point is reached.

More ominously still, it assesses the concentration of carbon dioxide in the atmosphere after which the two-degree rise will become inevitable, and says it will be 400 parts per million by volume (ppm) of CO2.

The current level is 379ppm, and rising by more than 2ppm annually - so it is likely that the vital 400ppm threshold will be crossed in just 10 years' time, or even less (although the two-degree temperature rise might take longer to come into effect).

"There is an ecological timebomb ticking away," said Stephen Byers, the former transport secretary, who co-chaired the task force that produced the report with the US Republican senator Olympia Snowe. It was assembled by the Institute for Public Policy Research in the UK, the Centre for American Progress in the US, and The Australia Institute.The group's chief scientific adviser is Dr Rakendra Pachauri, chairman of the UN's Intergovernmental Panel on Climate Change. [...]

Global warning has already hit the danger point that international attempts to curb it are designed to avoid, according to the world's top climate watchdog.

Dr Rajendra Pachauri, the chairman of the official Intergovernmental Panel on Climate Change (IPCC), told an international conference attended by 114 governments in Mauritius this month that he personally believes that the world has "already reached the level of dangerous concentrations of carbon dioxide in the atmosphere" and called for immediate and "very deep" cuts in the pollution if humanity is to "survive".

His comments rocked the Bush administration - which immediately tried to slap him down - not least because it put him in his post after Exxon, the major oil company most opposed to international action on global warming, complained that his predecessor was too "aggressive" on the issue.

A memorandum from Exxon to the White House in early 2001 specifically asked it to get the previous chairman, Dr Robert Watson, the chief scientist of the World Bank, "replaced at the request of the US". The Bush administration then lobbied other countries in favour of Dr Pachauri - whom the former vice-president Al Gore called the "let's drag our feet" candidate, and got him elected to replace Dr Watson, a British-born naturalised American, who had repeatedly called for urgent action.

But this month, at a conference of Small Island Developing States on the Indian Ocean island, the new chairman, a former head of India's Tata Energy Research Institute, himself issued what top United Nations officials described as a "very courageous" challenge.

He told delegates: "Climate change is for real. We have just a small window of opportunity and it is closing rather rapidly. There is not a moment to lose."

Afterwards he told The Independent on Sunday that widespread dying of coral reefs, and rapid melting of ice in the Arctic, had driven him to the conclusion that the danger point the IPCC had been set up to avoid had already been reached.

Reefs throughout the world are perishing as the seas warm up: as water temperatures rise, they lose their colours and turn a ghostly white. Partly as a result, up to a quarter of the world's corals have been destroyed.

And in November, a multi-year study by 300 scientists concluded that the Arctic was warming twice as fast as the rest of the world and that its ice-cap had shrunk by up to 20 per cent in the past three decades.

The ice is also 40 per cent thinner than it was in the 1970s and is expected to disappear altogether by 2070. And while Dr Pachauri was speaking parts of the Arctic were having a January "heatwave", with temperatures eight to nine degrees centigrade higher than normal.

He also cited alarming measurements, first reported in The Independent on Sunday, showing that levels of carbon dioxide (the main cause of global warming) have leapt abruptly over the past two years, suggesting that climate change may be accelerating out of control.

He added that, because of inertia built into the Earth's natural systems, the world was now only experiencing the result of pollution emitted in the 1960s, and much greater effects would occur as the increased pollution of later decades worked its way through. He concluded: "We are risking the ability of the human race to survive."