Gold continued its rise last week, closing at 467.40 dollars an ounce, up 1% from last week's 17-year record close of $462.90. Oil resumed its climb, closing at 64.19 dollars a barrel, up 1.9% from the previous week's close of $63.00 partly on fears of the effects of Hurricane Rita, which ended up not being as damaging as feared. The dollar closed at 0.8306 euros, up 1.6% from 0.8174, completing a 3% rise over two weeks against the euro. That puts the euro at $1.2040 compared to $1.2234 a week earlier. Gold in euros would be 388.21 euros an ounce at Friday's close, up 2.6% from the previous Friday's close of 378.37 and completing a 6.2% two-week rise. Oil in euros would be 53.31 euros a barrel at week's close, up 3.5% from the previous week's close of 51.50. The gold/oil ratio closed at 7.28 barrels of oil for an ounce of gold, down 1% from 7.35 last week. In the U.S. stock market, stocks were down for the week, with the Dow Jones Industrial Average closing at 10,419.59, down 2.1% from 10,641.94 at the previous week's close. The NASDAQ closed at 2,116.84, down 2.1% from last week's close of 2160.35. The yield on the ten-year U.S. Treasury note closed at 4.25%, down two basis points from last week's 4.27.

In spite of the clear weakness of the U.S. dollar in particular and the U.S. economy in general post-Katrina, the dollar rose against the euro. The drop in the euro can be partially attributed to the results of the German election. And we can call it a drop in the euro rather than a rise in the dollar because the dollar fell sharply again against gold.

Regarding the German elect, once again, European voters had the sense to reject Anglo-American neoliberal policies, this time in Germany, earning German voters the condescension of both the Anglo-American and the European media.

International press pours scorn on German voters

By Peter Schwarz
21 September 2005

The international press has reacted to the German parliamentary (Bundestag) election held on Sunday with a mixture of horror and indignation. The message given by voters was clearly understood. The result expressed a rejection of the policies of welfare cuts and "free market" reforms which are currently being pursued by all European governments.

The anticipated clear-cut victory of the conservative opposition, consisting of the Christian Democratic Union (CDU), the Christian Social Union (CSU) and the Free Democratic Party, over the ruling coalition of the Social Democrats (SPD) and the Greens, failed to materialize. Instead, neither camp won a majority in the Bundestag, the German parliament, and both the Social Democrats and the CDU recorded lower votes than in the previous national election.

It was, above all, a sharp defeat for the CDU and its candidate for chancellor, Angela Merkel, who had until recently enjoyed a double-digit lead over the incumbent chancellor, Gerhard Schröder of the SPD, according to pre-election polls. In the aftermath of the election, both Merkel and Schröder were insisting that they would head a new government.

The result of Sunday's vote marked the first time in Germany's post-war history that a national election failed to produce a clear victor, ushering in a period of parliamentary horse-trading and political uncertainty.

The overwhelming response of the European and international press to the election was indicated by the Milan-based Corriere della Sera, which lamented that in Germany "fears of economic decline and the loss of its welfare state had won." The Spanish newspaper El País commented: "The Germans tend anyway towards the left. They seem to prefer a moderate reform in the form of the Agenda 2010 to a radical change of the social system, as the right-wing intended."

Following the "no" vote in the European Union referendum in France, the German election marks the second time voters in a major European country have delivered a decisive blow to plans by the ruling elite to reorganize Europe on the basis of strict "free market" criteria.

"European politics, which was already in crisis following the no to the European Union constitution in France, threatens to be more paralyzed than ever," complained the Paris-based Figaro. The Corriere della Sera came to a similar conclusion, writing, "[I]t will be Germany and all of Europe which will have to pay the price."

The British Daily Telegraph concluded: "Beyond that, the absence of a black-yellow partnership [a government of Germany's conservative opposition] will mean, at best, scant advance on the limited changes introduced in Mr. Schröder's second term. And that, in turn, could slow reform in countries such as France and Italy. Europe as a whole is a loser from this profoundly unsatisfactory result."

The Danish Jyllands Posten lamented: "The result of the elections in Germany was just about the last thing which Europe needs now from its largest and most important nation."

From Stockholm, the Dagens Nyheter complained: "The signal for friends of reform in Europe is bad: Those who dare to take up responsibility for necessary steps run a large risk of being punished."

The staunchly conservative Swiss newspaper Neue Zürcher Zeitung reminded German voters: "The fact that the situation which has now come about excludes any reasonable future option can only be termed catastrophic. One is tempted to say that this fact must now penetrate deep into general consciousness. The people must look into the mirror and ask themselves what they really want."

Other newspapers joined in heaping abuse on the German electorate. The most extreme example was the Paris-based Libération, which, like the German Greens and their house organ taz, has its roots in the 1968 protest movement, but has in recent years developed into a reliable prop of the bourgeois order.

"Europe will emerge even more unsure of itself... from this strange election in Germany," Libération grumbled. "Germany now joins the club of countries in which protesters and radicals can create such damage that any normal political change is blocked and long-term policy paralyzed."

Astonishing. Libération is complaining that "normal political change" and "long-term policy" are not things that the public should have any say in. Of course we always knew this, but for a left-wing publication to chime in like this shows the gulf that is opening between the European public and the elite of whichever ideology.

Almost unanimously, the British press adopted a similar tone, accusing German voters of being too stupid to understand the necessity for reforms. The Guardian, which has close links to Tony Blair's Labour Party, wrote:

"For all the comparisons with Margaret Thatcher, 'Angie' [Angela Merkel]... demonstrated neither the charisma of Britain's "iron lady" nor the sort of radical policies needed to take Germany out of the doldrums where it has languished for the last seven years... This election was marked by deep pessimism, profound disillusion with the big parties and volatile voters who recognized the need for change but feared the effects it may bring. Much horse-trading and haggling lies ahead as these extraordinary results are digested. Germans may well want reform. But now paralysis looms because their nerves appear to have failed them."

The conservative Daily Telegraph blustered:

"The German electorate yesterday failed to grasp the opportunity for reform presented by the Christian Democrats (CDU) under Angela Merkel."

Both the British head of the government, Tony Blair, and the British conservative opposition had made no secret prior to the German election of their sympathies for Merkel. Blair even precipitated a diplomatic tiff during his last trip to Berlin in June, when he demonstratively visited the leader of the opposition before meeting with Germany's Social Democratic chancellor, Gerhard Schröder. Now there is even greater disappointment over Merkel's debacle in the elections.

Nearly all international newspapers warn against a grand coalition of the SPD and conservative parties which, they claim, would lead to economic paralysis and stagnation.

The London Financial Times based its comments on economists who warned that "... such a coalition would make it difficult for Europe's largest economy to adopt the structural reforms needed to overcome stagnation and record unemployment." The newspaper then quoted an executive at the auto concern BMW: "This is exactly what the country didn't need - a long period of uncertainty and negotiations. We will all be losers."

The American Wall Street Journal took up the theme:

"The muddled result, with neither major party able to form a stable parliamentary majority, means that Germany will not be taking decisive action anytime soon to reform its unwieldy welfare state, which has helped bring it 11 percent unemployment and zero economic growth. That will not be good for the world... "

The New York Times came to the same conclusion:

"In a grand coalition any reform of the German economy would be virtually excluded, as well as any rapprochement with the United States, as Merkel had indicated."

The vehemence with which the entire international press attacks the election result must be understood as a warning. The ruling elite is less and less willing to accept democratic procedures if they stand in the way of its own business and political interests.

This applies not only to the international press, but also to the German media, which comes to very similar conclusions. Under the heading "A Debacle," the Frankfurter Allgemeine Zeitung intoned:

"There seems to be less chance of convincing citizens to see the sense of fundamental changes and be prepared for changes of policy than some have maintained."

Last and not least, at the end of a long article in which all of the parties were subjected to some biting criticism, the weekly magazine Der Spiegel claimed that the German election result presented a "great chance": Finally all principles and election promises could be thrown overboard in favor of unrestrained expediency.

Wrote Der Spiegel, "Because outside of the election campaigns everybody knows each other in the political arena, what differentiates the parties today are above all cultural differences and historical factors... After this election, SPD-Green projects and intellectual-moral maneuvers can be finally dumped in the garbage can of history in favor of a blithe pragmatism."

The spooky unanimity with which the elite policy makers and the elite media parrot the neoliberal line is disturbing. Why do they so quickly reject the German model of social democracy (social insurance, high productivity, high cooperation between labor, industry and government), especially given its remarkably successful track record in the past sixty years? Sure, the U.K. can point to higher growth levels than Germany, but the U.K. was in much worse shape than Germany at the point when the neoliberal plans began to be implemented there. And the aggregate "growth," we are finding, has little to do with social health in societies where the gap between rich and poor is high. And long term economic health, as opposed to short term economic growth, depends on social and ecological health, two things likely to get worse under the neoliberal prescription. Here is the Prime Minister of Sweden on social and economic health:

We don't need no stinkin' US style capitalism!
Sweden tells Europe to hold its head high

In defense of the welfare state, by Jonathan Power, International Herald Tribune: (Stockholm) The statistics had arrived on the Swedish prime minister's desk … It was good news. Goran Persson, now in his ninth year of office, told me that the growth rate for this year will be near 3 percent and next year more than 3 percent - enough, he said, to maintain Sweden's trajectory of the last decade, which was "above the average for the European Union" and, in particular, "as good as the Anglo-Saxons, Britain and the U.S." ... This raised the first question - how does this self-confessed socialist state do it? What is the secret for success when Swedish taxes are the highest in the world and the welfare state is the country's single largest employer?

…"If you have a free economy," explained the prime minister, "a highly educated work force, a very healthy people, very high productivity and a sound environment then you can create the critical size of resources to create good growth." That has to be joined with adequate public financing of universities, research and development. As long as we are efficient and constantly challenging ourselves we continue to be productive. "Then if we produce successful growth, the government gets the public's support for high taxes. If the quality of the public sector is good, then a prosperous people will continue to vote for funding it."

…Persson … ends the conversation with two quick jabs. "Europe has a lack of confidence vis-à-vis the U.S.," he said. "The U.S. is competitive, but not as competitive as we think. We are too self-critical in Europe, even though we have a much better social system and in Sweden are just as productive. On unemployment, it is overlooked that the U.S. has approaching two million people in jail and out of the labor market."…

Xymphora has more on inequality and social health:

The problem of excessive inequality

From a review by Polly Toynbee of "The Impact of Inequality: How to Make Sick Societies Healthier" by Richard G. Wilkinson:

"Equality has gone out of fashion. Social justice under Labour means heaving the poorest over the poverty threshold and lifting the life chances of children from lower social classes. Tony Blair said early on that he was not bothered about wealth, only about abolishing poverty. Talk of inequality sounds like the old politics of envy. Equality of opportunity, yes, but equality for its own sake, why?

"Here is the answer. Richard Wilkinson is a professor of social epidemiology, an expert in public health. From that vantage point he sees the world in terms of its physical and psychological wellbeing, surveying great sweeps of health statistics through sociological eyes. He has assembled a mountain of irrefutable evidence from all over the world showing the damage done by extreme inequality.

However rich a country is, it will still be more dysfunctional, violent, sick and sad if the gap between social classes grows too wide. Poorer countries with fairer wealth distribution are healthier and happier than richer, more unequal nations."

and:

"Life expectancy in rich nations correlates precisely with levels of equality. So Greece, with half the GDP per head, has longer life expectancy than the US, the richest and most unequal country with the lowest life expectancy in the developed world. The people of Harlem live shorter lives than the people of Bangladesh. When you take out the violence and drugs, two-thirds of the reason is heart disease. Is that bad diet? No, says Wilkinson, it is mainly stress, the stress of living at the bottom of the pecking order, on the lowest rung, the stress of disrespect and lack of esteem. Bad nutrition does less harm than depression."

This runs exactly counter to the praises of excessive capitalism that is all we hear churned out by the usual propaganda machines that seem to be run by the corpse of Ayn Rand. From a discussion of Wilkinson's work by James Lardner (and see here):

"If inequality damages health, it probably operates through a variety of pathways. As George Kaplan and John Lynch at the University of Michigan point out, low income (even if it isn't low enough to meet the official definition of poverty) means limited access to education, health care, and other services, with long-term consequences for health. At the University of British Columbia in Vancouver, Clyde Hertzman has done extensive work on the latent effects of socioeconomically influenced differences in prenatal care and early childhood development. In the June 3rd issue of The Journal of the American Medical Association, Paula Lantz and James House, who work with Kaplan and Lynch at the University of Michigan, analyze the link between income and such forms of self-destructive behavior as smoking, alcohol abuse, and over-eating.

"But as Lantz and House point out, these specific risk factors explain only a comparatively small part of the socioeconomic gradient in health, which Wilkinson himself believes may, at bottom, have more to do with psychosocial factors - with what inequality does, for example, to friendship and the will to take part in social and community activities. 'I think that social relations - friendships and alliances - should be seen as horizontal relations between equals in contrast to the vertical hierarchy of power relations,' he says. 'Friendship and hierarchy are opposite principles of social organization. In friendship one is talking about mutuality and reciprocity - your needs being my needs. Hierarchy is about power, coercion, and access to resources regardless of other people's needs... It's strength and power that determine who gets what, and I think that's the fundamental reason why as inequality increases the social environment deteriorates.' We have much to learn, he says, from the 'vigilant sharing' of hunter-gatherer societies, where people 'don't compete for the essentials of life.'"

In the current climate of the dog-eat-dog world it is like farting in church to even mention it, but the single most important thing that those who set public policy can do to improve the health and happiness of society is to reduce inequality. The two ways to do this are through income redistribution through tax policy, and the public funding of education and health care (and in particular an early childhood development strategy). In the current political climate of the United States it is impossible to conceive of how these type of policies would be possible, but all those countries not suffering from the current American political malaise should be hopping to it. This issue is directly connected to the issue of social mobility.

As for ecological health, here is Urban Survival :

Accounting for the actual value of natural resources, including resource depletion and population growth, shows that net savings per person are negative in the world's most impoverished countries, particularly in sub-Saharan Africa, according to a new World Bank publication, Where is the Wealth of Nations?, launched on the eve of the 2005 U.N. World Summit…

"Where is the Wealth of Nations further substantiates the realization," said Steve McCormick, President and CEO, The Nature Conservancy, "that if we can't get a handle on the deconstruction of natural systems, then we will seriously jeopardize our efforts to make lasting, substantial progress on improving the standard of living of the world's poorest people. Put simply, healthy ecosystems are the foundation of healthy economies."

As we have alluded to over at our www.peoplenomics.com site, the problem for bankers is that they mostly live in a world of just 14 items (10 digits and the ,-,/,and * signs). The paradox is that in order to solve the problems of sustainable development there will have to be monetary values placed on things which don't lend themselves to investment.

Take a migratory path for salmon in the North Pacific. How do you capitalize that? What's the value of leaving it alone and safe from long liners and draggers from Japan, Russia, and Korea which have happily raped the ocean's insides?

Maybe it is time to join geology with economics. In that regard, many observers are sensing the possibility of some sort of Big Bad Event which manifests itself in both geological and economic ways. The Signs of the Times discussed economic issues last Friday, so if you haven't read it check out the archive of that page. Without repeating everything said, the editors made this prediction:

For many months we have been predicting that the American economy will collapse before the end of 2005. Given the available signs and evidence, we are now of the opinion that the current severe hurricane season, triggering a major earthquake and volcano on the US mainland, may well be the precursor to just such a collapse and its dire consequences for millions of American people. In essence, the scenes at the end of last month in New Orleans will soon be common throughout large areas of the North American continent.

Interestingly, the forecaster at Urban Survival who analyzes web-bot word scan results to predict near future events, sees heightened risk of earthquakes in California:

So there I was, just getting off the evening conference call with my friend Cliff of www.halfpasthuman.com and we were speculating on the possibilities of what the Big Event will be between September 26 and October 3-5th. I suggested that it might be a market crash, but Cliff still leans toward something else - yet to be revealed, perhaps another hurricane behind Rita - while the November 21st window in the linguistic scans looks mighty ugly for California in general and around earthquakes in particular. Still, even with Houston emptying out, we're less than half way to the emotive values that will arrive by the first half of December. Something wicked this way is coming, predicts the linguistic shift software.

With this cheerful mindset (not), I decided to call Robin Landry, an ex-Merrill, ex-Stifel-Nicolas VP… My first question for Landry was, with the market down under 10,400 at the close on Wednesday, how soon does the ultimate disaster - a second coming of 1929 Crash take place?

"I have been monitoring the wave structure on the 15-minute chart and watching the count and it's following, with clocklike precision, the Elliott Wave structure, We are due for a few small rallies in wave 4's to complete the Fourth Wave on this decline and then the 5th wave down to complete the first wave down of the Third Wave."

For those not familiar with Elliott theory, what the heck does that mean?

"It means that after a small rally in another decline to the approximate 1180 on the S&P 500 and the 10,200 of the Dow, then there will be a larger rally that will last a day or two. Then all hell breaks loose."

When you say "all hell" what does that mean in terms of the numbers?

"If my wave count is correct, when we break through the 1190-1200 area of the S&P, the uptrend line from the lows of April of this year, which were down around 1136 on the SP, at that point, the odds of this just being a corrective before the rally goes higher, the odds go over 50 percent and we jump up to 70% chance.

What that means at a minimum is that we will visit the 7,100 area of the October 2002."

Fine, but what's the real downside over the next year - with all the infrastructure damage, turning off oil, the shut-in gas, and millions of refugees plus the popping of housing and soaring unemployment - what is the possible downside once the whole derivatives house of cards begins to unwind because of massive defaults that will follow these natural disasters that were unforeseen as coming in two's and three's and four's when derivatives were drafted?

"In our past conversations I have mentioned to you many times that there was no question in my mind that we would visit 6,400 - no question. The next target below that is 5,000 and then below that I have a target at the 3,600 area.

The problem in the counts is how fast these events will happen. The targets, you might say, are pretty well established with the wave structures of the past - the things Gary Lammert talks about - but the wave structure is very clear when it breaks the 1190 and then the 1136 level.

In the Dow, a break below 10,000 is dangerous - after that there is no strong support until you reach the low of October of last year (9,700) but I believe that support will be very very easily broken because the trend line from that low up through the low of April at 10,000 drawn up through today shows it broke down yesterday.

Remember the rally from the 7,100 level in October 2002 went up and then tested that area around 7,400 in March of 2003. From March 2003 to February of 2004, that rally was strong and continuous. There are no stopping points along the way. You get a little bit of support from the bounce at up to 9,000, but looking at the wave structure, I believe the 9,000 is hardly worth thinking about because it was a short two day kind of thing on the way up. In short, you can't point to anything substantial and say "Ah, that's support..."

Well, if I put a dollar on the table today, regardless of what the market does in today's session, do you think the Dow will be above say 9,000 by the end of this year?

"No."

How about 8,000?

"Possibly"

Could it be as low as say 6,400 by New Years?

"That is entirely possible. You have to remember, in the wave structure count, a third wave decline (c). A third wave down (or up) is the longest and strongest. That doesn't mean the most time, it usually means the distance traveled is the longest. And the third wave is when people begin to realize that the direction of the market is going to be there for a good long while. We call what's on the horizon the "point of recognition" - which is where even the novices "get it" that the market is going down for a long time. Then you see the momentum swell and the selling goes through the roof and you won't be able to get out fast enough. The market will open down so fast that you won't be able to get out. Sure, we'll get sharp rallies, because that will complete the wave structure in the decline.

I believe the most likely time period for us to reach the 7,100 area or below is by October-November of 2006, but it's entirely possible that if you have a crash on the order of the ones in 1929 or the A wave down after the 2000 top, being a third wave now, these could could be a Fibonacci 1.618 times the size of those.

George the first one was from the top about 5/18/2001 at 11,350 and from there down to the 8,100 area on 9/21/2001. In five months, the market fell almost 5,000 points! The second crash came after the rebound off that which peaked around the week of 3/22/2002 at 10,676. Then the market fell to the intraday low of the 7,100 area on 10/11/2002. So here we had a period of not quite seven months. But here again, the decline was a little larger."

So if everyone saw this at once, and throw in a major California quake and a couple of more big hurricane hits, just to really push it over the top - and maybe a defeat of some size in Iraq, what does the 1.618 decline from what top look like.

"If you were to take that, I believe the next 5,000 points on the Dow could come off in short order. How fast that happens is a question mark. But I do believe that at the point of recognition (which we're coming to) we will have a one day decline of a thousand points.

What is in some sense disturbing is that more and more mainstream pundits are seeing the Apocalypse in the headlights. A couple of weeks ago we saw David Broder say that we are headed for 1929. Now Marshall Auerback is seeing fascism in the policies of the Bush regime:

Neither Compassionate, Nor Conservative

Marshall Auerback
September 20, 2005

"Couple a multi-state disaster of Katrina's magnitude, (including some of the poorer and less well-governed states in the union), add on a dysfunctional federal bureaucracy that had deteriorated in recent years, and a chief executive whose motto seemed to be, until yesterday, the buck stops there, and we get a helluva mess."
– Richard Murray, Houston-based public policy expert quoted in the Washington Post

"The worst storm in our history proved perfect for exposing this president because in one big blast it illuminated all his failings: the rampant cronyism, the empty sloganeering of 'compassionate conservatism,' the lack of concern for the 'underprivileged' his mother condescended to at the Astrodome, the reckless lack of planning for all government operations except tax cuts, the use of spin and photo-ops to camouflage failure and to substitute for action."
– Frank Rich, NY Times

Describing the President's panicked political response to his falling poll numbers as "compassionate conservatism", (as New York Times columnist David Brooks did last Sunday, "A Bushian Laboratory", September 18, 2005), borders on the ludicrous. Mr Bush has now overseen the fastest increase in domestic spending of any president in recent history. Furthermore, he has never resolved the inherent contradiction between his so-called "compassionate" spending policy and his small-government tax policy (which was ostensibly designed to "kill the beast" of Big Government once and for all, according to the President's conservative apologists). And his casual dismissal of the remnants of civilian authority in the Gulf basin – "It is now clear that a challenge on this scale requires greater federal authority and a broader role for the armed forces -- the institution of our government most capable of massive logistical operations on a moment's notice" – evokes something more along the lines of Mussolini-style fascism than any coherent, mainstream conservative, philosophy.

Hurricane Katrina is only the latest example of the President's extraordinary fiscal largesse – this time, borrowing hundreds of billions of dollars under the guise of "clear[ing] away the legacy of inequality." Sixty-two billion dollars has already been appropriated in the storm's aftermath, but total spending on hurricane relief could hit $200bn before all is said and done. This for an area in which a substantial proportion of people are unlikely to return. Occurring so late in the fiscal year, the hurricane will have little effect on federal spending in 2005, when the deficit is forecast to come in around $330bn, but the 2006 deficit is looking likely to hit the $450bn mark. No wonder the gold price hit a fresh 17-year high last week.

Not even the most liberal social engineers would dare to have been as bold as the Bush administration. The President gives no accounting of how the money will be found. His governing philosophy appears to be: "It's going to cost whatever it's going to cost" in contrast to the vision of "focused and effective and energetic government", David Brooks imputes to him. Mr Bush has left the oversight in the hands of his political operative, Karl Rove, suggesting that this a major PR exercise, rather than (per Brooks) "a positive use of government that is neither big government liberalism nor antigovernment libertarianism". (As an aside, maybe Mr Rove should have been placed in charge of the initial rescue effort. Without a single mishap, the Bush "rescue team" delivered to central New Orleans its own generators, lights, the camouflage netting designed to conceal the surrounding devastation, and its own communications equipment; the city almost looked whole again. The Federal government, it appears, cannot run an evacuation and relief effort properly, but it does a magnificent job of televised stage-setting in a disaster area.)

For all of the talk of the President's radical foreign policy, an even more remarkable metamorphosis has taken place domestically: The Republican Party has come full circle from, "Government is not the solution to our problem; government is the problem" to an acceptance of the primacy of government responsibility for all things. The man elected ostensibly to curb the excesses of the "spendthrift Democrats" has presided over an expansion the likes of which put FDR and LBJ to shame. According to the Heritage Foundation (not exactly a liberal propagandist), the rebuilding effort in New Orleans follows a 33 percent expansion of the federal government since 2001, a period that saw:

- The 2001 No Child Behind Act, the most expensive education bill in American history, which led to a 100 percent increase in education spending;

- The 2002 Farm Security and Rural Investment Act, the most expensive farm bill in American history;

- The 2003 Medicare Modernization Act, the most expensive Great Society expansion in history;

- A war in and the rebuilding of Iraq that, while justified, could cost between $300 and $600 billion, in total;

- International spending leap 94 percent;

- Housing and Commerce spending surge 86 percent;

- Community and regional development spending jump 71 percent;

- Health research spending increase 61 percent;

- Veterans' spending increase 51 percent; and

- The number of annual pork projects leap from 6,000 to 14,000.

This from a Federal government, which has hitherto shown a singular inability to conduct an evacuation and relief effort properly, but is now expected to lead the way in reconstructing New Orleans, a city in which the school system is virtually bankrupt and racked by corruption (the U.S. Education Department reported in February that $70-million in federal funds for low-income students had been misspent or could not be accounted for), presumably to be part-administered by a mayor whose stunning failure to mobilize resources to evacuate car-less residents and hospital patients - despite warning signals from the city's botched response to the threat of Hurricane Ivan in September 2004 – demonstrates that ineptitude extends to all levels of government.

What a change in course from just a mere year ago when the administration pressured Congress to cut $71 million from the budget of the Army Corps' New Orleans district despite warnings of the epic hurricane seasons close at hand. In fact, during the early stages of the Bush Presidency, then director of FEMA, former Bush campaign manager Joe M. Allbaugh, (now a lobbyist for Kellogg Brown & Root Services, a subsidiary of Halliburton), decried disaster assistance as "an oversized entitlement program" and urged Americans to rely more upon the Salvation Army and other faith-based groups.

The reality today is that there remains a fundamental contradiction between the planned Gulf Opportunity Zone approach (is there a Wizard of GOZ?) which rhetorically fits the Ownership Society theme of this Administration, and the actual botched dirigiste response to date, which further begs the question: what good has all that money dropped into homeland security done if the government cannot execute natural disaster relief effectively? So much for a consistent governing philosophy!

To be fair, one element of consistency has always been evident during the Bush Presidency: that of cronyism. Within days of this disaster striking, Halliburton was awarded a Navy contract for repairing naval installations. This company's ongoing involvement in the operations of the US Federal government is nothing new, but it is not the only beneficiary from the latest example of "compassionate conservatism". Many other Bush-allied companies that have performed so well in the field of Iraqi "reconstruction" are getting the lion's share of new no-bid contracts, while smaller, local businesses (which arguably have a far greater stake in the economic survival in the region) are essentially being locked out of the rebuilding effort….

Among the other recipients who did hear from the Bush administration were California-based Fluor Corp., which has contributed more than $800,000 to political campaigns this decade, about three-fourths of it to the GOP, the Shaw Group Inc. of Louisiana, (another client of consultant Joe Allbaugh), and Kellogg, currently working under a $500 million contract with the Navy on repairs of Navy facilities damaged in the hurricane. President Bush's "compassionate conservatism" appears neither particularly compassionate, nor conservative (nor particularly efficient: with all of the reconstruction work largely conducted via contractors and sub-contractors, it is difficult to see how the government will effectively monitor the funds provided for this exercise). But it does reward political loyalty.

If Halliburton et al actually provided value for money for the American taxpayer, it would be one thing. The reality is quite different: Henry Waxman, a Democrat and the ranking minority member on the House of Representatives Committee on Government Reform has uncovered evidence that Vice President Cheney's former company was being grossly overpaid by the American occupation authorities for the petrol it was importing into Iraq from Kuwait, at a profit of more than $150 million. Waxman and his assistants found, for example, that Halliburton was charging $2.64 a gallon for petrol for Iraqi civilians, while American forces were importing the same fuel for $1.57 a gallon.

The reconstruction of Louisiana, Mississippi, and Alabama provides a fascinating picture of how the Bush administration actually works. His government represents an odd melding of corporatism and cronyism, more in tune with the workings of 1930s Italy or Spain. In fact, if one looks at fascist regimes of the 20^th century, it is appears that the Bush administration draws more from these sources than traditional conservatism. Dr. Lawrence Britt has examined the fascist regimes of Hitler (Germany), Mussolini (Italy), Franco (Spain), Suharto (Indonesia) and several Latin American regimes. Britt found 14 defining characteristics common to each:

1. Powerful and Continuing Nationalism - Fascist regimes tend to make constant use of patriotic mottos, slogans, symbols, songs, and other paraphernalia. Flags are seen everywhere, as are flag symbols on clothing and in public displays.

2. Disdain for the Recognition of Human Rights - Because of fear of enemies and the need for security, the people in fascist regimes are persuaded that human rights can be ignored in certain cases because of "need." The people tend to look the other way or even approve of torture, summary executions, assassinations, long incarcerations of prisoners, etc.

3. Identification of Enemies/Scapegoats as a Unifying Cause - The people are rallied into a unifying patriotic frenzy over the need to eliminate a perceived common threat or foe: racial, ethnic or religious minorities; liberals; communists; socialists, terrorists, etc.

4. Supremacy of the Military - Even when there are widespread domestic problems, the military is given a disproportionate amount of government funding, and the domestic agenda is neglected. Soldiers and military service are glamorized.

5. Rampant Sexism - The governments of fascist nations tend to be almost exclusively male-dominated. Under fascist regimes, traditional gender roles are made more rigid. Divorce, abortion and homosexuality are suppressed and the state is represented as the ultimate guardian of the family institution.

6. Controlled Mass Media - Sometimes to media is directly controlled by the government, but in other cases, the media is indirectly controlled by government regulation, or sympathetic media spokespeople and executives. Censorship, especially in war time, is very common.

7. Obsession with National Security - Fear is used as a motivational tool by the government over the masses.

8. Religion and Government are intertwined - Governments in fascist nations tend to use the most common religion in the nation as a tool to manipulate public opinion. Religious rhetoric and terminology is common from government leaders, even when the major tenets of the religion are diametrically opposed to the government's policies or actions.

9. Corporate Power is protected - The industrial and business aristocracy of a fascist nation often are the ones who put the government leaders into power, creating a mutually beneficial business/government relationship and power elite.

10. Labor Power is suppressed - Because the organizing power of labor is the only real threat to a fascist government, labor unions are either eliminated entirely, or are severely suppressed.

11. Disdain for Intellectuals and the Arts - Fascist nations tend to promote and tolerate open hostility to higher education, and academia. It is not uncommon for professors and other academics to be censored or even arrested. Free expression in the arts and letters is openly attacked.

12. Obsession with Crime and Punishment - Under fascist regimes, the police are given almost limitless power to enforce laws. The people are often willing to overlook police abuses and even forego civil liberties in the name of patriotism. There is often a national police force with virtually unlimited power in fascist nations.

13. Rampant Cronyism and Corruption - Fascist regimes almost always are governed by groups of friends and associates who appoint each other to government positions and use governmental power and authority to protect their friends from accountability. It is not uncommon in fascist regimes for national resources and even treasures to be appropriated or even outright stolen by government leaders.

14. Fraudulent Elections - Sometimes elections in fascist nations are a complete sham. Other times elections are manipulated by smear campaigns against or even assassination of opposition candidates, use of legislation to control voting numbers or political district boundaries, and manipulation of the media. Fascist nations also typically use their judiciaries to manipulate or control elections.

(Source: The Fourteen Defining Characteristics of Fascism, Dr. Lawrence Britt, Spring 2003, Free Inquiry)

Perhaps it is unfair to characterise the Bush Presidency in these terms, because it would imply the existence of a coherent governing philosophy. In fact, the President's actions in regard to the "war on terror", Iraq, and now the reconstruction efforts in the Gulf basin smack of panic and political expediency: When there's a problem, throw money at it. For all of the talk about the President "accepting responsibility" for the fiasco, his speech was certainly no Trumanesque "The buck stops here" oratory; it was rather a promise to rebuild New Orleans with other people's money, saying that his people (not the President himself, mind you) had made mistakes and they would fix them. Of course, part of the point of fiscal responsibility, after all, is that disasters do happen and the government should have fiscal leeway to respond to them. But the US today has no leeway at all, thanks to this president and his party. The "compassion and resolve of our nation" are amply demonstrated by a whopping huge expenditure, the costs of which are to be imposed on future generations of American taxpayers. Or more accurately, coming during a week which also saw the annual rate of growth in the current account deficit hitting nearly $750 billion, (more than 6% of GDP), the President's latest act of "compassionate conservatism" puts the rest of the world on notice that it is going to have to stump up even more credit for this Argentina of the northern hemisphere. One wonders whether these particular creditors' goodwill is likely to prove as durable as the levees of New Orleans.

WASHINGTON - U.S. Federal Reserve Chairman Alan Greenspan told France's Finance Minister Thierry Breton the United States has "lost control" of its budget deficit, the French minister said on Saturday.

"'We have lost control,' that was his expression," Breton told reporters after a bilateral meeting with Greenspan.

"The United States has lost control of their budget at a time when racking up deficits has been authorized without any control (from Congress)," Breton said.

"We were both disappointed that the management of debt is not a political priority today," he added.

Ministers from the Group of Seven rich nations on Friday called for vigorous action around the world to curb rising imbalances in international trade and investment accounts.

A decrease in the U.S. budget deficit were cited by the G7 as one way to ease those imbalances. U.S. Treasury Secretary John Snow said the U.S. administration was still committed to halving its budget deficit by 2009.

Breton spoke as International Monetary Fund Managing Director Rodrigo Rato said U.S. plans to cut its government expenditures now looked ambitious in the light of huge reconstruction costs to be borne in the wake of Hurricane Katrina.

Breton said: "The situation that is creating tension today on the currency market ... is clearly the American deficit."

The United States needed to address its budget deficit, he said, adding: "It seems to me that my counterpart John Snow is completely aware of this, he wants to harness the problem, but it seems to me he doesn't have the room for maneuver."

Breton added that after hearing Greenspan talk about inflation: "One has the feeling -- though he didn't say so -- that interest rates will probably continue to rise slightly until his departure."

Greenspan is due to step down as Fed chairman in January after 18 years in the post.

Asked if G7 finance chiefs would meet as usual in February next year as well as gathering for an extraordinary meeting in December this year -- partly to pay tribute to Greenspan before his departure -- the French finance chief said: "Yes, yes. Next February as well."

He said France was "not against" the idea of enlarging the Group of Seven, a notion that has gained impetus at these meetings.

SAN ANTONIO, Texas (AP) -- Military officials told President Bush on Sunday that the U.S. needs a national plan to coordinate search and rescue efforts following natural disasters or terrorist attacks.

Bush said he is interested in whether the Defense Department should take charge in massive national disasters.

"Clearly, in the case of a terrorist attack, that would be the case, but is there a natural disaster -- of a certain size -- that would then enable the Defense Department to become the lead agency in coordinating and leading the response effort?" Bush asked. "That's going to be a very important consideration for Congress to think about." [...]

Under the existing relationship, a state's governor is chiefly responsible for disaster preparedness and response. Governors can request assistance from the Federal Emergency Management Agency. If federal armed forces are brought in to help, they do so in support of FEMA, through Northern Command, set up as part of a military reorganization after the attacks of September 11, 2001. [...]

Bush got an update about the federal hurricane response from military leaders at Randolph Air Force Base. He heard from Lt. Gen. Robert Clark, joint military task force commander for Hurricane Rita, and Maj. Gen. John White, a task force member, who described search and rescue operations after Hurricane Katrina as a "train wreck."

With Katrina, "we knew the coordination piece was a problem," White said. He said better coordination is needed to prevent five helicopters, for example, from showing up to rescue the same individual. "With Rita, we had the benefit of time. We may not have that time in an earthquake scenario or similar incident," White said.

"With a national plan, we'll have a quick jump-start and an opportunity to save more people," White said.

Speaking of the helicopter example, White said, "That's the sort of simplistic thing we'd like to avoid." He added, "We're not maximizing the use of forces to the best efficiency. Certainly that was a train wreck that we saw in New Orleans."

Bush thanked White for his recommendations.

"This is precisely the kind of information I'll take back to Washington to help all of us understand how to do a better job," the president said.

Later, Bush spent a little more than an hour getting a private briefing in a FEMA joint field operations office that was set up in an empty department store building.

He urged people not to be too eager to return to their homes.

"It's important that there be an orderly process," Bush said. "It's important that there be an assessment of infrastructure."

Bush's comments came as residents along the Texas and Louisiana coasts began clearing up debris and power crews worked to restore power to more than 1 million customers in four states.

Rita, which hit the Gulf Coast early Saturday, toppled trees, sparked fires and swamped Louisiana shoreline towns with a 15-foot storm surge that required daring boat and helicopter rescues of hundreds of people.

Still, the devastation was less severe than that caused by Hurricane Katrina when it made landfall August 29, three days after striking Florida.

After the briefing, Bush attended a worship service at a chapel on the base.

Bush's appearance was clearly a surprise to the base congregation. The chaplain, Col. David Schroeder, said, "We usually make new people stand up and introduce themselves." Everyone laughed at that, and then he announced the president. Bush stood along with the entire, clapping congregation.

Before returning to Washington, Bush was visiting Baton Rogue, Louisiana. The White House has not released details of his scheduled.

On Saturday, he made a stop in Austin, Texas, and at the U.S. Northern Command in Colorado. [...]

CAMERON, Louisiana -- Towns near where Hurricane Rita made landfall have had all but a handful of buildings destroyed, including nearly all homes in Cameron, Holly Beach and Creole, officials say.

Though less destructive than Hurricane Katrina, Rita caused extensive damage when it roared ashore Saturday morning near the Texas-Louisiana border with 120 mph winds.

Along the state line, Louisiana's Cameron Parish was under as much as 15 feet of water, and thousands of homes were destroyed, said Freddie Richard, the head of emergency preparedness for the parish of 10,000 residents.

About 45 miles south of nearby Lake Charles, every home was destroyed in the town of Holly Beach, Richard told CNN.

In the parish seat of Cameron, 90 percent of homes were destroyed, he said.

In Creole, 70 percent of residences were destroyed, with little more than the courthouse and an elementary school still standing, according to Richard. (City-by-city impact)

More than 925,000 customers in Texas, Louisiana, and Mississippi are without electricity as a result of Hurricanes Rita and Katrina, officials said.

Coast Guard Vice Adm. Thad Allen told CNN that no deaths had been reported in Louisiana, and Texas Gov. Rick Perry reported no storm-related deaths in his state.

But a Rita-spawned tornado killed one person in Mississippi, and 24 people died Friday when a bus carrying evacuated nursing home residents caught fire and was ripped by explosions on Interstate 45 south of Dallas.

Water in Lake Charles was receding Sunday, revealing buildings smashed to bits.

"The lake has risen higher than I've ever seen in my lifetime," said Lake Charles Mayor Randy Roach. But, he added, "Everyone who wanted to got out."

Lake Charles Police Chief Donald Dixon said "sporadic" looting had taken place and will likely increase as food and water run out.

The city has no power, no sewer system, no open stores or gasoline stations, he said, while downed trees and power lines make the city "very unsafe."

But he vowed to protect the property of people who evacuated. About 15 people were arrested for looting, including some at an adult video store.

Lake Charles and surrounding Calcasieu Parish, on the Texas-Louisiana state line, were closed Sunday to returning residents because of damage to roads and infrastructure.

City and parish officials have set a target date of October 3 -- next Monday -- for allowing residents to return. They want to have them return in stages, with business owners being allowed back earlier.

Farther west, in Port Arthur and Sabine Pass, Texas, officials were conducting house-to-house searches for victims or survivors, Port Arthur Mayor Oscar Ortiz said.

Ortiz was among many locals whose homes were destroyed. "It's all gone," he told CNN.

He said two refineries appeared to be leaking gasoline. Boats and ships were tossed onto roadways by Rita's storm surge, and oil rigs ripped loose from their moorings had drifted ashore, he said.

"We've got a lot of damage," he said. [...]

POCATELLO - To the rest of the country, Scott Stevens is the Idaho weatherman who blames the Japanese Mafia for Hurricane Katrina. To folks in Pocatello, he's the face of the weather at KPVI News Channel 6.

The Pocatello native made his final Channel 6 forecast Thursday night, leaving a job he's held for nine years in order to pursue his weather theories on a full-time basis.

"I'm going to miss that broadcast, but I'm not going to miss not getting home until 11 p.m.," Stevens said. "I just don't have the hours of the day to take care of my research and getting those (broadcasts) out and devoting the necessary research to the station."

It was Stevens' decision to leave the TV station, said KPVI general manager Bill Fouch.

"When Scott signed his current contract, he told Brenda and me at the time that it would be his last contract," Fouch said Thursday. "We knew, but the timetable moved up because of all the attention (he's been getting.)"

Since Katrina, Stevens has been in newspapers across the country where he was quoted in an Associated Press story as saying the Yakuza Mafia used a Russian-made electromagnetic generator to cause Hurricane Katrina in a bid to avenge the atomic bomb attack on Hiroshima. He was a guest on Coast to Coast, a late night radio show that conducts call-in discussions on everything from bizarre weather patterns to alien abductions. On Wednesday, Stevens was interviewed by Fox News firebrand Bill O'Reilly.

Stevens said he received 30 requests to do radio interviews on Thursday alone.

Fouch said Stevens wanted to leave as quickly as possible because his "plate is full," and he needs to take advantage of the opportunities that exist now.

Stevens said he's received offers that he's not at liberty to discuss.

Stevens, 39, who was born in Twin Falls, plans to remain in Pocatello, where his family remains. He said his family wishes him the best in his future endeavors.

It costs him hundreds of dollars each month to run his Web site, weatherwars.info, but he said that's a price he's willing to pay.

"There's a chess game going on in the sky," Stevens said. "It affects each and every one of us. It is the one common thread that binds us all together."

Although the theories espoused by Stevens - scalar weapons, global dimming - are definitely on the scientific fringe today, there are thousands of Web sites that mention such phenomena.

"The Soviets boasted of their geoengineering capabilities; these impressive accomplishments must be taken at face value simply because we are observing weather events that simply have never occurred before, never!" Stevens wrote on his Web site. "The evidence of these weapons at work found within the clouds overhead is simply unmistakable. These patterns and odd geometric shapes seen in our skies, each and every day, are clear and present evidence that our weather has been stolen from us, only to be used by those whose designs for humanity are rarely in alignment with that of the common man."

However, Stevens never discussed his weather theories on the air during his time at Channel 6 - an agreement he had with the station management. What the meteorologist chose to do in his off time was his business, said his manager of eight years.

Fouch said he would miss Stevens, whom he described as energetic, easy-going and enthusiastic about the weather, but he is supportive of his decision to pursue his passion.

"His theories are his theories," Fouch said. "But, if you think about it - of all the TV weather people, he continues to be the most accurate. It isn't his theories getting involved with his professional job."

For Stevens, however, the recent attention to his theories has been somewhat of a distraction from work.

"When there has been so much attention, it gets in the way of them doing their jobs and me doing my job," Stevens said.

Find out more:

To learn more about Stevens and his thoughts on manipulated weather, check out his Web site at www.weatherwars.info, or go to www.journalnet.com/articles/2005/03/06/opinion/opinion04.txt to read the story that Journal City Editor Greg McReynolds wrote about Stevens in March.

INDIA: The people of Palugulu of Mahadevapur on the banks of the Godavari in Karimnagar district are a petrified lot after they witnessed a meteorite falling close to their village with big flash of light and a bang.

Astonishingly, as many as 10 persons lost consciousness on watching the meteorite falling. According to the eyewitnesses, it fortunately landed in the river. But the villagers, not knowing the exact location of strike, remained awake whole night.

The villages in the radius of about 60 km witnessed the heavenly body falling.

Mahadevapur MRO Kesava Reddy visited the spot and could not spot any tell tale marks there. Then he concluded that the meteorite might have fallen in the river. He allayed their fears by explaining about meteors.

LIMA, Peru - A powerful earthquake with a preliminary magnitude of 7 hit northern Peru late Sunday, causing power outages and cutting phone service throughout much of the region.

One radio report said four people were killed.

Peru's Geophysics Institute said the quake struck at 8:55 p.m. and was centered about 60 miles northeast of the jungle city Moyobamba, 420 miles north of the capital Lima.

"Several houses have fallen down and there are several people dead," Carlos Mori, who lives near Moyobamba in the town of Lamas, told Radioprogramas. "All of the residents of Lamas are in the streets. Most of the people are helping."

Mori said about 20 houses had collapsed and that four people were dead.

A police officer in Tarapota, another town near Moyobamba, told Radioprogramas that power had gone out and that there was some damage to buildings, but no deaths to report.

A regional official said some walls had crumbled in the jungle city of Chachapoyas, about 100 miles northwest of the epicenter, and power was out about an hour but there were no deaths.

The earthquake was felt throughout Peru's northern coast and as far away as Bogota in Colombia.

It was the strongest quake to strike Peru since an 8.1-magitude quake hit the Arequipa province in southern Peru in June 2001, killing at least 75 people and leaving tens of thousands homeless.

AYERS JUNCTION, Maine - A minor earthquake shook a small region in northern Maine, officials said. There were no reports of injuries or damage.

The preliminary epicenter of the quake Saturday night was about three miles from Ayers Junction, said John Ebel, director of the Weston Observatory and a professor of geophysics at Boston College.

The quake measured 3.4 on the Richter scale. A quake of 4.0 magnitude can do moderate damage.

"That's too small to be damaging, although it was probably a good rumble and probably woke some people up near the epicenter," Ebel said.

The quake likely was felt about 20 to 30 miles from the epicenter, Ebel said.

A magnitude-3.2 earthquake rattled the Mojave Desert Sunday but no damage or injuries were reported, authorities said.

The quake at 7:04 p.m. was centered 13 miles north of Palm Springs, according to the California Institute of Technology. [...]

Haroon Aswat – the man British Police believe was behind the London bombings – was working for MI6, it has been confirmed by leading U.S. and French intelligence asset/agents.

Now an FBI agent in Seattle – name removed for security reasons, but can be published at the drop of a hat – has demanded that former USDA federal agent, Dr Janette Parker, stop talking to the British media about how the FBI obstructed their own top terrorism investigator, John O'Neill in his enquiries.

Dr Parker, who worked alongside O'Neill, although not in an official capacity, is fearful of her life.

"Janet is a highly-professional and honest person. She is very brave," says Christopher Berry-Dee, publisher of TNC. "But, now the cat is out of the bag, and we have ensured that she will be protected by circulating her information to leading British newspapers and the media."

Dr Parker writes: "The American press can be silenced but not the British press. MI-5 and MI-6 are not happy about the intelligence failure on the American side of the Atlantic, especially withholding information about Haroon Aswat's intention for additional bombings and his fund raising in Seattle area in March 2002 (after 911)."

Haroon Aswat is the primary suspect as the mastermind of the London Bombings 7/7. The FBI can assert that Haroon was not in Seattle on March 6, 2002, but British intelligence had him under close surveillance and they know whether he was in England or not.

Dr Parker, who is supported by many other FBI agents and John Loftus (see: http://www.newcriminologist.co.uk/news.asp?id=1124824797) adds: "You can fool some of the people some of the time, all the people some of the time but not all the people all of the time."

By trying to discredit Dr Parker, she claims:

"The effort of the FBI to hide their own internal problems has now made it impossible for me to expose the corruption and fraudulent documents at the University of Washington Harborview Medical Center in Seattle. There were 40 doctors involved and 8 departments. Two doctors pled guilty to Medicaid billing fraud and obstruction of justice charges. The FBI had been conducting an investigation into the medical billing fraud but did not get indictments against them."

In verified documents, sent to TNC and the British media, Dr Parker's explosive investigative results cover far-ranging matters, from terrorist training camps, money laundering for the extreme Islamic terror campaigns, FBI cover-ups, prostitution and brutal homicide, threats to her own welfare, physical abuse and intimidation, to include possible phone taps and email interception.

With the events, unfolding in Chicago, (see: http://www.newcriminologist.co.uk/news.asp?id=1529297048 ) even a blind man can see that the current U.S. administration is rotten thru-and-thru, and this corruption has long spread to the UK – where British citizens should be demanding of Prime Minister Blair why SIS/MI6 was using Haroon Aswat as an agent, and why, as John Loftus claims, was Aswat – who was on the British security services 'Watch List', allowed to leave the UK, when the British Police were desperately searching for him?

Pinning down Aswat's movements – as all of the movements of the London Bombers – prior to the bombings is crucial, claim New Scotland Yard.

"Dr Parker's information IS crucial," says TNC. "Her knowledge of Special Agent John Neill's work in counter-terrorism, could make her a very valuable asset if the Met really mean what they say."

The 911 disaster (of course the U.S. emergency services hotline number) could have been prevented, as could have the London Bombings.

As a deeply embedded intelligence source recently told TNC:

"Bush and Blair are just puppets. Their strings are tugged by money, corruption, ego, by the Intel services. You don't even want to know the truth."

In a chilling observation, our source, who has been verified as having carried out executions on behalf of H.M. Government, and MI6, and a man who has served 25-years for terrorism offenses, added:

"The Northern Ireland Bank Robbery... the Dublin Art theft... the stealing of millions of pounds of UK Government Bonds – two in the name of Mark Thatcher – has all been covered up... MI6 would order me to commit murder, then the SAS would try and shoot me because I knew too much."

"International terrorism is VERY BIG business," our source confirmed. "The U.S. and UK trade in terrorism like it is some kind of off-the-shelf commodity. Forget the destruction of lives to normal people, women and children. I have been there and done it all. Your Dr Parker has done the right thing. Like me she is cladding herself with insurance – like a Kevlar jacket, and I wish her all the best."

In a strange twist, an FBI agent emailed TNC, saying: "We wish you all good luck, and I personally hope that something good comes out of all of this."

The people of the U.S. should be very proud of Dr Parker. And those of us who are concerned about terrorism in the UK should salute her

Intelligence interests may thwart the July bombings investigation

The videotape of the suicide bomber Mohammad Sidique Khan has switched the focus of the London bombings away from the establishment view of brainwashed, murderous individuals and highlighted a starker political reality. While there can be no justification for horrific killings of this kind, they need to be understood against the ferment of the last decade radicalising Muslim youth of Pakistani origin living in Europe.

During the Soviet occupation of Afghanistan in the 1980s, the US funded large numbers of jihadists through Pakistan's secret intelligence service, the ISI. Later the US wanted to raise another jihadi corps, again using proxies, to help Bosnian Muslims fight to weaken the Serb government's hold on Yugoslavia. Those they turned to included Pakistanis in Britain.

According to a recent report by the Delhi-based Observer Research Foundation, a contingent was also sent by the Pakistani government, then led by Benazir Bhutto, at the request of the Clinton administration. This contingent was formed from the Harkat-ul- Ansar (HUA) terrorist group and trained by the ISI. The report estimates that about 200 Pakistani Muslims living in the UK went to Pakistan, trained in HUA camps and joined the HUA's contingent in Bosnia. Most significantly, this was "with the full knowledge and complicity of the British and American intelligence agencies".

As the 2002 Dutch government report on Bosnia makes clear, the US provided a green light to groups on the state department list of terrorist organisations, including the Lebanese-based Hizbullah, to operate in Bosnia - an episode that calls into question the credibility of the subsequent "war on terror".

For nearly a decade the US helped Islamist insurgents linked to Chechnya, Iran and Saudi Arabia destabilise the former Yugoslavia. The insurgents were also allowed to move further east to Kosovo. By the end of the fighting in Bosnia there were tens of thousands of Islamist insurgents in Bosnia, Croatia and Kosovo; many then moved west to Austria, Germany and Switzerland.

Less well known is evidence of the British government's relationship with a wider Islamist terrorist network. During an interview on Fox TV this summer, the former US federal prosecutor John Loftus reported that British intelligence had used the al-Muhajiroun group in London to recruit Islamist militants with British passports for the war against the Serbs in Kosovo. Since July Scotland Yard has been interested in an alleged member of al-Muhajiroun, Haroon Rashid Aswat, who some sources have suggested could have been behind the London bombings.

According to Loftus, Aswat was detained in Pakistan after leaving Britain, but was released after 24 hours. He was subsequently returned to Britain from Zambia, but has been detained solely for extradition to the US, not for questioning about the London bombings. Loftus claimed that Aswat is a British-backed double agent, pursued by the police but protected by MI6.

One British Muslim of Pakistani origin radicalised by the civil war in Yugoslavia was LSE-educated Omar Saeed Sheikh. He is now in jail in Pakistan under sentence of death for the killing of the US journalist Daniel Pearl in 2002 - although many (including Pearl's widow and the US authorities) doubt that he committed the murder. However, reports from Pakistan suggest that Sheikh continues to be active from jail, keeping in touch with friends and followers in Britain.

Sheikh was recruited as a student by Jaish-e-Muhammad (Army of Muhammad), which operates a network in Britain. It has actively recruited Britons from universities and colleges since the early 1990s, and has boasted of its numerous British Muslim volunteers. Investigations in Pakistan have suggested that on his visits there Shehzad Tanweer, one of the London suicide bombers, contacted members of two outlawed local groups and trained at two camps in Karachi and near Lahore. Indeed the network of groups now being uncovered in Pakistan may point to senior al-Qaida operatives having played a part in selecting members of the bombers' cell. The Observer Research Foundation has argued that there are even "grounds to suspect that the [London] blasts were orchestrated by Omar Sheikh from his jail in Pakistan".

Why then is Omar Sheikh not being dealt with when he is already under sentence of death? Astonishingly his appeal to a higher court against the sentence was adjourned in July for the 32nd time and has since been adjourned indefinitely. This is all the more remarkable when this is the same Omar Sheikh who, at the behest of General Mahmood Ahmed, head of the ISI, wired $100,000 to Mohammed Atta, the leading 9/11 hijacker, before the New York attacks, as confirmed by Dennis Lormel, director of FBI's financial crimes unit.

Yet neither Ahmed nor Omar appears to have been sought for questioning by the US about 9/11. Indeed, the official 9/11 Commission Report of July 2004 sought to downplay the role of Pakistan with the comment: "To date, the US government has not been able to determine the origin of the money used for the 9/11 attacks. Ultimately the question is of little practical significance" - a statement of breathtaking disingenuousness.

All this highlights the resistance to getting at the truth about the 9/11 attacks and to an effective crackdown on the forces fomenting terrorist bombings in the west, including Britain. The extraordinary US forbearance towards Omar Sheikh, its restraint towards the father of Pakistan's atomic bomb, Dr AQ Khan, selling nuclear secrets to Iran, Libya and North Korea, the huge US military assistance to Pakistan and the US decision last year to designate Pakistan as a major non-Nato ally in south Asia all betoken a deeper strategic set of goals as the real priority in its relationship with Pakistan. These might be surmised as Pakistan providing sizeable military contingents for Iraq to replace US troops, or Pakistani troops replacing Nato forces in Afghanistan. Or it could involve the use of Pakistani military bases for US intervention in Iran, or strengthening Pakistan as a base in relation to India and China.

Whether the hunt for those behind the London bombers can prevail against these powerful political forces remains to be seen. Indeed it may depend on whether Scotland Yard, in its attempts to uncover the truth, can prevail over MI6, which is trying to cover its tracks and in practice has every opportunity to operate beyond the law under the cover of national security.

· Michael Meacher is the Labour MP for Oldham West and Royton; he was environment minister from 1997 to 2003

A woman has been arrested over the leak of findings about the fatal police shooting of Brazilian Jean Charles de Menezes on the London Underground.

The 43-year-old was arrested at one of a number of London addresses searched.

The Independent Police Complaints Commission (ICC) leak prompted claims police had covered up details of the shooting at Stockwell station in July.

No details were given on the grounds for Wednesday's arrest. The woman was later released on police bail.

Electrician Mr Menezes was shot by police on 22 July - the day after several failed bomb attempts - when he was mistaken for one of the bombing suspects.

Search warrants

The leak is being investigated by Leicestershire Police after ITV News ran details of the IPCC inquiry into the shooting.

A police statement said: "On Wednesday 21 September, Leicestershire Constabulary, supported by officers from the City of London Police, executed a number of search warrants at addresses in the London area.

Sir Ian Blair The Menezes family demanded the resignation of Sir Ian Blair

"A 43-year-old woman was arrested at one of the London addresses and later released on bail pending further inquiries."

The leaked information contradicted much of what had previously been thought about Mr Menezes' death and led his family to demand the resignation of Metropolitan Police chief Sir Ian Blair.

Scotland Yard was quoted as saying that Mr Menezes' "clothing and demeanour" added to suspicions that he was a suspected suicide bomber.

However, the leaked documents and photographs show the body of Mr Menezes, on the Tube where he was shot dead by police, wearing a denim jacket - not a bulky one as previously described.

At the end of August, the IPPC announced an inquiry into how the documents were leaked, led by former Chief Inspector of Constabulary for Scotland Bill Taylor.

Israeli aircraft blasted suspected Palestinian weapons facilities and other militant targets throughout the Gaza Strip early today, at the launch of what the military said would be a "prolonged" offensive against Hamas militants for bombarding Israeli towns with rockets.

The offensive in Gaza dashed hopes that Israel's recently completed Gaza withdrawal would help restart peace talks and left a seven-month-old ceasefire on the brink of collapse.

The fighting also raised already intense pressure on Palestinian leader Mahmoud Abbas to confront militants.

In the West Bank, meanwhile, the Israeli military arrested 150 Palestinian wanted men, most of them members of the Hamas and Islamic Jihad movements, in an operation that remained under way this morning.

The military has conducted sweeping arrests of Islamic Jihad militants since the February ceasefire, but this is the first time since the truce that it has detained large numbers of Hamas members.

Among those arrested were Hassan Yousef, the most prominent Hamas leader in the West Bank, Hamas officials said.

The Israeli Security Cabinet, a group of senior officials led by Prime Minister Ariel Sharon, approved the military operation in Gaza at an emergency meeting late last night after Hamas militants fired nearly 40 rockets from Gaza at southern Israeli towns.

The rocket barrage, which slightly wounded six Israelis, was the Islamic group's first major attack since Israel concluded its Gaza pullout last week.

"It was decided to launch a prolonged and constant attack n Hamas," said Major General Yisrael Ziv, the army's head of operations, hinting that Israel was preparing to resume its assassination of top Hamas leaders, a practice suspended after the February ceasefire. Asked whether the leaders were in danger, he said: "Let them decide for themselves."

Israel killed dozens of Hamas leaders, including the group's founder, Sheikh Ahmed Yassin, during more than four years of violence.

Israeli security officials said Operation First Rain would include artillery fire, air strikes and other targeted attacks.

The operation will grow in intensity, leading up to a ground invasion in several days unless Abbas's Palestinian Authority halts the rocket attacks or Hamas ends the attacks itself, officials said.

The ground operation would require final approval from the full Cabinet, they added.

Palestinian Interior Ministry spokesman Tawfiq Abu Khoussa called the plan a "serious escalation that will lead to a new era of violence".

Shortly after the ministers' decision, Israeli aircraft struck a series of targets throughout Gaza, including three weapons-storage facilities and a Gaza City school the military said served as a front for Hamas. Other targets included the offices of the Popular Front for the Liberation of Palestine, a small militant group. [...]

Kurtzer said that the growth of the Islamic movement in the Palestinian territories in recent decades—"with the tacit support of Israel"—was "not totally unrelated" to the emergence of Hamas and Islamic Jihad and their terrorist attacks against Israel. Kurtzer explained that during the 1980s, when the Islamic movement began to flourish in the West Bank and Gaza, "Israel perceived it to be better to have people turning toward religion rather than toward a nationalistic cause [the Palestinian Liberation Organization—ed.]." It therefore did little to stop the flow of money to mosques and other religious institutions, rather than to schools. [...]

The Enemy of My Enemy Is My Friend

This statement is extraordinary given the fact that Kurtzer is a very senior diplomat, having held the post of Ambassador to Egypt just prior to going on to Tel Aviv. He is also an Orthodox Jew who is not shy of criticizing the extreme anti-Israeli and anti-Semitic views held by certain Arab circles. But Israeli Prime Minister Ariel Sharon rarely grants the United States' highest representative in Israel an official audience.

The ambassador's comments are an acknowledgment of what any serious Middle East observers knows: Hamas has always been seen as a tool by which Israel could undermine the nationalist movement led by Palestinian Authority President and Palestine Liberation Organization (PLO) Chairman Yasser Arafat. Similar statements by Arafat have been dismissed by Israel as "cranky" propaganda. In an interview with the Dec. 11 Italian daily Corriere della Sera, Arafat said, "We are doing everything to stop the violence. But Hamas is a creature of Israel which at the time of Prime Minister [Yitzhak] Shamir [the late 1980s, when Hamas arose], gave them money and more than 700 institutions, among them schools, universities and mosques. Even [former Israeli Prime Minister Yitzhak] Rabin ended up admitting it, when I charged him with it, in the presence of [Egpytian President Hosni] Mubarak."

To the Italian daily L'Espresso, Arafat laid out the reasons for this support. "Hamas was constituted with the support of Israel. The aim was to create an organization antagonistic to the PLO. They received financing and training from Israel. They have continued to benefit from permits and authorizations, while we have been limited, even to build a tomato factory. Rabin himself defined it as a fatal error. Some collaborationists of Israel are involved in these [terror] attacks," he said. "We have proof, and we are placing it at the disposal of the Italian government."

On one level the support for Hamas is simply the application of the old saying, "The enemy of my enemy is my friend." Indeed, in the minds of crude Israeli ultra-nationalists and fascists such as Sharon and his faction, this is indeed the case. Sharon is not interested in peace and therefore is not concerned that the violence and needless deaths of Israelis and Palestinians continue. In the Jan. 3 Ha'aretz, Yossi Sarid, chairman of the Meretz party, wrote, "What does frighten Sharon ... is any prospect or sign of calm or moderation.

If the situation were to calm down and stabilize, Sharon would have to return to the negotiating table and, in the wake of pressure from within and without, he would have to raise serious proposals for an agreement. This moment terrifies Sharon and he wants to put it off for as long as he possibly can." In contrast, Sarid said that Sharon understands "that the terrorists and those who give them asylum are not the real enemies. Instead, the real enemies are the moderates.... You fight terrorists—a pretty simple operation—but you must talk with moderates, and this is a very tricky, if not dangerous, business."

More important for the survival of not only the Palestinian people, but especially Israel itself, is the dangerous role of the puppetmasters outside the region, who are manipulating both sides of this deadly game as part of their own demonic plans to spread the policy of a "clash of civilizations." In this regard, Sharon, and his "Greater Israel" policy, is just as much a puppet as the Palestinian, strapped with explosives, who blows himself up at an Israeli bus station.

Given the level of control that the Israeli intelligence services such as the Shin Bet and Mossad have been able to exert over the Palestinian territories during the last 35 years of Israeli occupation, the capability to manipulate militant and violent organizations, such as those associated with Hamas, should not surprise anyone familiar with intelligence and even routine police operations. This should be obvious, considering that Israel has routinely recruited thousands of collaborators and provocateurs among the tens of thousands of Palestinians who have passed through Israeli prisons in over 35 years of its occupation of the West Bank and Gaza Strip.

Most convincing is a comparison of the development of Hamas, Islamic Jihad and their antecedents, and the growing national and international legitimacy of the PLO and its undisputed leader, Arafat.

Hamas is an acronym for Harafat al-Muqawama Al-Islamiyya, or Islamic Resistance Movement. Its spiritual leader is Sheikh Ahmed Yassin, who, despite his fiery anti-Israeli sermons, has had an unusual relationship with the Israeli authorities. In 1973, Yassin established the Islamic Association—at a time when it was Israeli policy to promote what Ambassador Kurtzer refers to as the "Islamic movement."

One might ask: Why should Israel promote an Islamic movement which later turns around and attacks it? How could the Israeli secret services be taken in by a Yassin? They weren't. The simple fact is, that the stated policy of Hamas is simply the flip side of Sharon's "Greater Israel" policy that refuses to seek a territorial compromise. The Hamas charter in 1988 stated, "The land of Palestine has been an Islamic Waqf throughout the generations, and until the Day of Resurrection, no one can renounce it or part of it, or abandon it or part of it.... Peace initiatives, the so-called peace initiatives, are all contraray to the beliefs of Hamas, for renouncing any part of Palestine means renouncing part of the religion." In this rhetoric there is no room for a state of Israel—as there is none for a state of Palestine in Sharon's "Greater Israel."

Israel's Hamas relations intensified after the Arab League, in 1974, decided to recognize Arafat and the PLO as the representatives of the Palestinian people—in effect, a government in exile. By 1979, top Yassin acquired an official permit from the Israeli government of Prime Minister Menachem Begin. This coincided with the signing of the Camp David peace treaty between Israel and Egypt. That treaty embodied detailed clauses calling for the establishment of a Palestinian Authority in the Occupied Territories, which would be the precursor for the Israeli withdrawal and the establishment of a Palestinian state. Gen. Ariel Sharon has been the chief proponent since this treaty was signed, of the policy of ensuring that these clauses would never be implemented. His chosen alternatives were war in Lebanon and the expansion of the Jewish settlements in the Occupied Territories. Sharon was helped by the assassination of Egyptian President Anwar Sadat by Anglo-American-controlled, Egypt-based Islamic terrorists.

Israeli toleration, if not initial sponsorship of the Islamic movement, has been acknowledged and well documented in Israeli sources. In 1997, the Jaffee Center for Strategic Studies, at Tel Aviv University, published a study, "Hamas: Radical Islam In A National Struggle," authored by Anat Kurz and Nahman Tal. It stated that the Islamic Association, "the platform of which contained no nationalist clauses, obtained a permit from the Israeli Civil Administration in 1979 to conduct its activities. The permit was apparently consistent with the Israeli policy of strengthening Islamic bodies as a counterweight to Palestinian nationalist groups."

The rapid expansion of the Islamic Association led to clashes on the Palestinian University campuses in the Occupied Territories in the 1980s, betwen PLO-affiliated students and those associated with the Islamists. This expansion was aided by the 1982 Israeli invasion of Lebanon, where Sharon hoped to solve the "Palestinian problem" by militarily crushing the PLO—which was then based in Lebanon—and by carrying out genocide against the hundreds of thousands of Palestinians living in impoverished refugee camps in Lebanon. Despite his orchestration of the massacre of thousands of Palestinians, including women and children, at the Sabra and Chatila refugee camps, Sharon failed to eliminate Arafat. Nonetheless, Arafat and the PLO were exiled to Tunisia, their influence severely weakened.

Sheikh Yassin, along with other Hamas leaders, was arrested in 1984, after it was discovered that the Islamic Association had maintained arms caches. But the organization was not banned. In fact, Yassin was soon released as part of an unprecedented prisoner exchange between Israel and Ahmed Jabril's PFLP-General Command. This deal, made with one of the most violent of all anti-PLO Palestinian groups at the time, was made in a period when the Mossad was busy assassinating the most moderate of PLO leaders.

Then, in 1988, the Islamic Association created Hamas as a direct alternative to the PLO, which had launched the first Intifada the year before. 1988 was also important because the PLO, at the 19th Conference of the Palestinian National Council in Algeria in 1988, accepted the United Nations Security Council resolution of 1947 calling for two states in Palestine. They also called for convening an international peace conference based on UN Resolutions 242 and 338, which established the land-for-peace concept. This was a de facto recognition of Israel by the PLO and Arafat. By the end of 1988, the Reagan Administration extended official recognition to the PLO as the official representative of the Palestinian people.

When Palestinian leader Abu Jihad began negotiating with Hamas, in an attempt to win its mass base over to the new policy, he was promptly assassinated by the Mossad. [...]

The Oslo Accords marked the first glimmer of hope for a resolution of the Middle East conflict. And, the first suicide terrorist attack aimed at destroying it was not launched by Hamas or Islamic Jihad or another Palestinian faction. The first suicide attack was launched on Feb. 25, 1994, by Israeli terrorist Baruch Goldstein, when he entered the Mosque of Hebron and killed 50 Muslim worshippers as well as himself. Goldstein was a member of Kach, the terrorist organization founded by the late Meir Kahane, who also founded the Jewish Defense League in the 1960s in the United States. Kach, which is well connected to Sharon, is on the official U.S. State Department list of terrorist organizations.

The unprecedented massacre was calculated to set the stage for a suicide bombing campaign by Hamas and its split-off, Islamic Jihad, over the next year. In fact, it set into motion the "cycle of violence" that has yet to end. The Goldstein attack came at precisely the point when Israeli Prime Minister Rabin and Arafat began the formal implementation of the Oslo agreement which envisioned the establishment of a Palestinian state by 1998. The first Hamas-linked suicide attacks did not start until two months later, in April 1994, when Rabin and Arafat signed the agreement for the establishment of the Palestinian National Authority. The agreement called for the conduct of free elections throughout the territories—which would eventually establish the international legitimacy of the Arafat-led government.

But despite this terror campaign, which lasted for months under a massive crackdown by Arafat's security forces, the Rabin-Arafat alliance, although seriously weakened, was not broken. This alliance was finally broken with Rabin's assassination by an Israeli, on Nov. 5, 1995. [...]

On Wednesday, June 23, the Congress of the United States passed an incredible resolution. By a vote of 407 to 9, the House passed Concurrent Resolution 460 to give total support to Israel's hard right Likud government to annex the great bulk of Palestine and make it part of Israel.

The Resolution, which appears to have been passed with little discussion or debate, expressed two main thoughts: It strongly endorses the April 14, 2004 George W. Bush letter to Ariel Sharon that gives US approval to Israeli Likud plans for the West Bank and Gaza. It supports efforts to build Palestinian institutions to fight terrorism that will "prevent the areas from which Israel has withdrawn from posing a threat to the security of Israel."

But the really devastating language of this resolution is in the whereas clauses, those statements made to justify the resolution. Those clauses in summary affirm that: President Bush and Ariel Sharon already have made a deal, and the Palestinians, the United Nations, and all third parties no longer have anything to say on this subject. "The United States will do its utmost to prevent any attempt by anyone to impose any other plan."

In light of "new realities", mainly because the Israeli settlements exist (they are called "Israeli population centers" in the Bush letter) they have become part of Israel. The Palestinian refugee issues can be resolved only "through the establishment of a permanent alternative and the settling of Palestinian refugees there rather than in Israel."(emphasis added). "The United States remains committed to the security of Israel - and to preserving and strengthening the capability of Israel to deter enemies and defend itself."

Stripped of any polite language, this resolution is a total commitment of the President and the Congress of the United States to creation of the Zionist dream of a greater Israel. To the Palestinians, this resolution says any territory they retain in this deal will look like a piece of Swiss cheese and include no more than 10% of their ancestral home. Israeli peace activist, Ury Avnery, called this plan "a recipe for continuing the war".

Particularly to Arab states, the resolution is take it or leave it: "All Arab states must oppose terrorism, support emergence of a peaceful and democratic Palestine, and state clearly that they will live in peace with Israel." Moreover, the resolution leaves no doubt that the United States will continue to arm the Israelis. Arming them also means that the United States will continue to look the other way while (contrary to US law) Israeli forces use modern, powerful, US supplied weapons to repress the Palestinian people. Why would Bush and the Congress do this now? The Bush letter, says the Resolution, "will enhance the security of Israel and advance the cause of peace in the Middle East." ...

[C]onsidering the chaos in Iraq, the Congress of the United States has just codified the most powerful terrorism generator that has come into existence since 9-11. ... [T]his resolution tells the Palestinians that they should abandon hope, recognize that their future will be worse than their past, but get in line, and cooperate with the inevitable. The prospect this paints for them is that they not only must accept loss of their homes and property, and the withering of any viable Palestinian state, but they should expect no compensation and they must look elsewhere for a place to live.

Not only are Palestinian extremists strengthened by this, but their support bases will grow among the Palestinian people and among other peoples of the region. [...] What is most striking about the situation is that the Zionists have to know that the risks of Palestinian terrorist attacks, as well as attacks by sympathizers, will greatly increase.

Perhaps the Zionists are so dedicated to the idea of greater Israel that they do not care, but as several analysts recently have concluded, and as the overall tone of the Congressional resolution suggests, Sharon could not move ahead with his plans, and he certainly would not receive promised levels of US support, if the terrorists stopped attacking. Probably no members would concede that this resolution makes the President and the Congress responsible for coming rounds of terrorist violence and military reprisals in Palestine, as well as attacks on Americans abroad, but that is the simple fact.

In a slavish bid for political support in November, both the President and the Congress have bought into Zionist plans. Neither seems aware that polls show the majority of American Jews oppose Sharon's plan, even though they are too intimidated by the Zionists to object. In any case, in order to get themselves elected, Congress and the President have assured continuing violence in Palestine and they collectively have chosen to make the world less safe for Americans

The Saudi ambassador to London has reinforced controversial claims by the kingdom's royal family of a link between "Zionists" and recent al-Qaeda terror attacks in the country.

In a television interview, to be broadcast today, Prince Turki al-Faisal is asked about comments made by Crown Prince Abdullah, Saudi Arabia's de facto leader, that "Zionist hands" have been behind the attacks.

The ambassador replies: "When you're under attack by people who come and kill your countrymen and visitors to your country, and you see at the same time an attack on the kingdom from the outside, from Zionist circles, it is natural to make a connection."

He declined to expand on his remarks yesterday but his comments were condemned by Lord Janner of Braunstone, the former Labour MP. "In my view it is highly offensive and he must realise that the statement is totally unfounded."

"No terrorism serves the interests of Zionism. The allegation by the Crown Prince was rubbish and he must know that."

Prince Abdullah made his original remarks when he addressed a conference of leading Saudi officials and academics last month after an attack on contractors at the Yanbu oil facility that left six Westerners - including two Britons - dead.

"Zionism is behind it," he said. "It has become clear now. It has become clear to us. It is not 100 per cent, but 95 per cent that Zionist hands are behind what happened."

In his interview today, Prince Turki contends that Saudi Arabia has been subjected to concerted attacks by "so-called 'experts' with Zionist connections" for 50 years, and particularly since the terror atrocities of September 11, 2001.

"Is it beyond any comprehension or understanding that such attacks come at us from the Zionists on one side and from al-Qaeda on the other side and not make connection between them?" he asked.

The ambassador also says that the families of victims of terror attacks committed in Saudi Arabia, including Westerners, can still insist on the death penalty for their killers under Islamic sharia law, despite the offer of a state amnesty to terrorists who surrender in the next month.

He insists that the regime is doing everything it can to root out terrorists and rejects claims that the Saudi royal family's days are numbered.

Raised from the dead, with a new leg and a new accent - the ghost of Al-Zarqawi haunts the docile western public and garners their support for further US land grabs.

As America escalates its "war on terrorism" which in fact is a war on Islam, the need to escalate disinformation and propaganda is also prevalent, particularly when the American public is losing its stomach for the battle, when American lives are being lost each day and when the President continues to be caught red handed in one scandal after another.

To rouse public opinion to support America's colonial war effort, the US intelligence community has created it own terrorist organizations. War propaganda, disinformation and counterterrorism are braided together to achieve the maximum result, for "terrorism" must remain front and center in the minds of American citizens if America is going to reach its foreign policy objectives, be it under George Bush or John Kerry.

Here's how it works. The disinformation is circulated to the news media and then the intelligence community creates its own terror warnings concerning the very organizations it has created. In some cases, the disinformation appears in advance, in order to pave the way for an up and coming act of "terror" that roots in a desired political outcome. This problem/solution equation always appears when the war effort is waning and serves to give a face to terror via an expensive advertising campaign.

And this is precisely what we have in Abu Musab Al-Zarqawi, America's new "public enemy No 1". Zarqawi and his group have been used, from the justification for the invasion of Iraq to the latest "barbaric" videotaped beheadings that his group claims to have carried out. The US State Department has increased the reward for his arrest from $10 million to $25 million, which puts his "market value" at par with that of Osama. Interestingly, Al Zarqawi is not on the FBI most wanted fugitives list.

What follows are excerpts from an in-depth report from The Centre for Research on Globalization that has gone to considerable lengths to document this false flag operation. The complete article can be read here

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Al Zarqawi's Links to Al Qaida

Al Zarqawi is often described as an "Osama associate", the bogyman, allegedly responsible for numerous terrorist attacks in several countries. In other reports, often emanating from the same sources, it is stated that he has no links to Al Qaida and operates quite independently. He is often presented as an individual who is challenging the leadership of bin Laden.

His name crops up on numerous occasions in press reports and official statements. Since early 2004, he is in the news almost on a daily basis.

Osama belongs to the powerful bin Laden family, which historically had business ties to the Bushes and prominent members of the Texas oil establishment. Bin Laden was recruited by the CIA during the Soviet-Afghan war and fought as a Mujahideen. In other words, there is a longstanding documented history of bin Laden-CIA and bin Laden-Bush family links, which are an obvious source of embarrassment to the US government.

In contrast to bin Laden, Al-Zarqawi has no family history. He comes from an impoverished Palestinian family in Jordan. His parents are dead. He emerges out of the blue.

He is described by CNN as "a lone wolf" who is said to act quite independently of the Al Qaida network. Yet surprisingly, this lone wolf is present in several countries, in Iraq, which is now his base, but also in Western Europe. He is also suspected of preparing a terrorist attack on American soil.

He seems to be in several places at the same time. He is described as "the chief U.S. enemy", "a master of disguise and bogus identification papers". We are led to believe that this "lone wolf" manages to outwit the most astute US intelligence operatives.

According to The Weekly Standard --which is known to have a close relationship to the Neocons in the Bush administration: "Abu Musab al Zarqawi is hot right now. He masterminded not only Berg's murder but also the Madrid carnage on March 11, the bombardment of Shia worshippers in Iraq the same month, and the April 24 suicide attack on the port of Basra. But he is far from a newcomer to slaughter. Well before 9/11, he had already concocted a plot to kill Israeli and American tourists in Jordan. His label is on terrorist groups and attacks on four continents." (Weekly Standard, 24 May 2004)

Al-Zarqawi's profile "is mounting a challenge to bin Laden's leadership of the global jihad."

In Iraq, he is said to be determined to "ignite a civil war between Sunnis and Shiites". But is that not precisely what US intelligence is aiming at ( "divide and rule") as confirmed by several analysts of the US led war? Pitting one group against the other with a view to weakening the resistance movement.

The CIA, with its $30 billion plus budget, pleads ignorance: they say they know nothing about him, they have a photograph, but, according to the Weekly Standard (24 May 2004), they apparently do not know his weight or height.

There is an aura of mystery surrounding this individual which is part of the propaganda ploy. Zarqawi is described as "so secretive even some operatives who work with him do not know his identity."

Consistent Pattern

What is the role of this new mastermind in the Pentagon's disinformation campaign, in which CNN seems to be playing a central role?

In previous propaganda ploys, the CIA hired PR firms to organize core disinformation campaigns, including the Rendon Group. The latter worked closely with its British partner Hill and Knowlton, which was responsible for the 1990 Kuwaiti incubator media scam, where Kuwaiti babies were allegedly removed from incubators in a totally fabricated news story, which was then used to get Congressional approval for the 1991 Gulf War.

What is the pattern?

Almost immediately in the wake of a terrorist event or warning, CNN announces (in substance): we think this mysterious individual Abu Musab Al-Zarqawi is behind it, invariably without supporting evidence and prior to the conduct of an investigation by the relevant police and intelligence authorities.

In some cases, upon the immediate occurrence of the terrorist event, there is an initial report which mentions Al-Zarqawi as the possible mastermind. The report will often say (in substance): yes we think he did it, but it is not yet confirmed and there is some doubt on the identity of those behind the attack. One or two days later, CNN may come up with a definitive statement, quoting official police, military and/or intelligence sources.

Often the CNN report is based on information published on an Islamic website or a mysterious Video or Audio tape. The authenticity of the website and/or the tapes is not the object of Discussion Or Detailed Investigation. [...]

Was it a coincidence? At the very outset of the Abu Ghraib prison scandal, there were rumors of an Al Zarqawi terrorist attack on American Soil, in Jordan as well as in Iraq.

Al Zarqawi identified by CNN as "the lone wolf" was, according to these reports, planning terrorist attacks simultaneously in several countries. Then there was the mysterious video on the Nicholas Berg execution.

The Attacks in Jordan

A mysterious tape released by CNN pointed to Al Zarqawi's plan to attack the Jordanian intelligence headquarters in an attack using chemical weapons which could have been more deadly than 9/11. Again the evidence is based on a mysterious tape.

Alleged Al Zarqawi "Attack on America"

Two days later, following the alleged terrorist threat on Jordanian intelligence, the State Department announced that Al Zarqawi was planning an attack on America (29 April 2004, CNN Report). Note that the rumours of an attack on America and the attack in Jordan took place virtually at the same time. [...]

"The State Department says terrorists are planning an attack on U.S. soil. High on their anxiety list, terrorist Abu Musab al-Zarqawi. He is representative of a very real and credible threat. His operatives are planning and attempting now to attack American targets, and we are after them with a vengeance." CNN

Bear in mind that the Attack on America report, focusing on "We are after them with a vengeance", was published one day following the CBS 60 minutes program on torture at the Abu Ghraib prison. (Complete transcript at http://globalresearch.ca/articles/CBS405A.html ).

The Nicholas Berg Video

Barely a couple of weeks later (11 May 2004), Al Zarqawi is reported as being the mastermind behind the execution of Nicholas Berg on May 11, 2004.

Again perfect timing! The report coincided with calls by US Senators for Defense Sec Donald Rumsfeld to resign over the Abu Ghraib prison scandal. It occurs a few days after President Bush's "apology" for the Abu Ghraib prison "abuses" on May 6.

The Nicholas Berg video served to create "a useful wave of indignation" which served to distract and soften up public opinion, following the release of the pictures of torture of Iraqi prisoners.

CNN coverage of the Nicholas Berg execution was based on a mysterious report on an Islamic website, which CNN upholds as providing "evidence" of Al-Zarqawi's involvement: "The Web site claims that the killing was done by Abu Musab al-Zarqawi, a Jordanian terrorist whose al Qaida affiliated group is held responsible by U.S. intelligence for a string of bombings in Iraq and for the killing of an American diplomat in Amman. CNN Arab linguists say, however, that the voice on the tape has the wrong accent. They do not believe it is Zarqawi. U.S. officials said the killers tried to take advantage of the prison abuse controversy to gain attention."

A subsequent more definitive report by CNN was aired 2 days later on 13 May 2004.

"The CIA confirms that Nicholas Berg's killer was Abu Musab al-Zarqawi; The CIA acknowledges sticking to strict rules in tough interrogations of top al Qaida prisoners." (CNN)

"Blitzer: Because originally our own linguists here at CNN suspected that -- they listened to this audiotape and they didn't think it sounded like Abu Musab al-Zarqawi. But now definitively, the experts at the CIA say it almost certainly is Abu Musab al-Zarqawi? Ensor: They say it almost certainly is. There's just a disagreement between the CNN linguists and the CIA linguists. The U.S. Government now believes that the person speaking on that tape and killing Nick Berg on that tape is the actual man, Abu Musab al- Zarqawi."

Did the US officials check the mysterious website or was it CNN?

The video footage published on the website was called "Abu Musab Al-Zarqawi shows killing of an American". Then the CIA experts released a statement saying that Abu Musab Al-Zarqawi was the man in the mask who beheaded the US citizen Nick Berg in front of a camera." Yet several reports question the authenticity of the video.

Al Zarqawi is Jordanian. Yet the man in the video posing as Jordanian native Zarqawi does not speak the Jordanian dialect. Zarqawi has an artificial leg, but none of these murderers did. The man presented as Zarqawi had a yellow ring, presumably a golden one, which Muslim men are banned from wearing, especially so-called fundamentalists. Another report states that Zarqawi was dead.

Immediately when the issue of his artificial leg was mentioned in relation to the video, US officials revised their story, stating they were not sure whether he actually lost a leg: "U.S. intelligence officials, who used to believe that Zarqawi had lost a leg in Afghanistan, recently revised that assessment, concluding that he still has both legs." (News and World Report, 24 May 2004).

There were a number of other aspects of the video, which suggest that it was a fraud: there was no blood when Nicholas Berg was beheaded. The audio was not in synchrony with the video, indicating that the film might have been manipulated. [...]

We now also have the Kim Sun-Il beheading to add to Al-Zarqawi "list". The video tape strikes a close resemblance to that of Nick Bergs and raises just as many questions about its authenticity, with almost the same individuals appearing, the same orange prison gear and the same bloodless execution. It appeared on a website hosted in California and boasted links to Reuters, to the March of Dimes and the National Wildlife Federation. Both "barbaric" incidents have curiously occurred in quick succession following the Abu Ghraib atrocities.

While the US State Department has increased the reward for Al Zarqawi's arrest from $10 million to $25 million, which equals that of Bin Laden, he is not on the FBI most wanted fugitives list. That's because Al- Zarqawi is a product of American intelligence and the main actor in this covert false flag operation.

America is both creator and defender in this war on terrorism that exists only because of its greed for global dominance. While hatred is now raging against Muslims who are being attributed with the brutal acts the American government is in fact staging, Muslim anger is also growing as is the number of those who are prepared to stand in legitimate resistance against an enemy that respects no law, no human life or moral code.

An Iraqi judge yesterday issued arrest warrants for two British soldiers, presumed to be SAS men, whose detention by Iraqi police and subsequent rescue by British forces in Basra last week has thrown an unprecedented spotlight on Britain's role in Iraq.

Early yesterday a flurry of rockets was fired at buildings occupied by British troops, but police said the only injuries were suffered by an Iraqi family in a house hit by one missile. Tensions aroused by last week's clashes remain high, with Basra's governor refusing to co-operate with British forces until the local authorities receive an apology and compensation for the damage caused when troops stormed the al-Jamiat police station on Monday.

The arrest warrants issued by Judge Raghib al-Mudhafar, chief of the Basra anti-terrorism court, have "no legal basis", according to British spokesmen, because of the agreement giving British forces legal immunity. "We have a legal obligation to investigate the allegations ourselves," said a Ministry of Defence official. "That is being done as we speak. We will continue to work with the Iraqis on the inquiry which the Iraqi government has begun."

But Judge Mudhafar says he is not convinced the two men are British - possibly because one of them was said to have been carrying a Canadian-made weapon - and they may not be entitled to immunity. This has added yet another layer of mystery to what is already an extremely murky affair.

Who are the two men, and what were they doing when they were seized outside Jamiat police station? What prompted British forces to smash down the wall of the station and demolish several prefabricated buildings inside the compound in the operation to snatch them back? Is it true that they had been handed over to a militia, or that the men inside the station were militia in police uniform?

The search for answers to those questions reveals that the picture the British public has been allowed to gain of our occupation of southern Iraq - one of relative tranquillity and co-operation compared to the bloody mayhem further north - is at best misleading, at worst deliberately distorted.

At the request of the MoD, British media obscured the faces of the two captured men. The two sides give wildly differing accounts of events, but it is not disputed that they had been sitting in a car outside the police station in Arabic dress. They were heavily armed and had an impressive array of surveillance equipment with them. It is not impossible that one or both of the men are not British. Special forces from Australia and New Zealand, for example, often work closely with the SAS. They could even be "civilian contractors" of the kind hired by the CIA, usually ex-special forces. But it is their mission that is more significant.

Subversion from nearby Iran has been blamed for a recent increase in attacks on British forces in southern Iraq, including the use of more sophisticated and deadly roadside bombs, which have claimed the lives of three soldiers. Initial assumptions that the undercover pair were working to combat such influence have been contradicted by military and other sources, however. Not only are they sceptical about the Iranian connection, pointing out that there is more than enough explosive and bomb-making expertise available in Iraq, but they say the surveillance operation was the result of a problem largely of Britain's own making.

The occupation authorities have turned a blind eye while Shia militias - including one loyal to the Prime Minister, Ibrahim al-Jafaari, who appeared in London last week with the Defence Secretary, John Reid, to condemn the violence - have infiltrated the police in southern Iraq. Another group supports the maverick Shia cleric, Moqtada al-Sadr; it is hardly surprising that Basra's police chief admitted last week that he could count on the loyalty of only a quarter of his men.

Corruption among the poorly trained and ill-disciplined police is another concern. "They sell their uniforms to insurgents for $25 while also taking the wage as a police officer supporting the multinational force," said one British squaddie. "So why do we bother?"

It is the adherents of Ahmed al-Fartusi, who broke away from Mr Sadr's Mahdi Army, who are the greatest danger. According to sources in Basra, they had turned the Jamiat police station in south-western Basra into a hotbed for smuggling, political assassination and organised crime, and trouble was already feared when Mr Fartusi and another suspect were arrested last Sunday. The seizure of the surveillance team outside the station lit the touchpaper. British forces surrounded the compound, and were attacked by crowds of Iraqis.

Initial attempts by British military spokesmen to minimise what happened merely heightened confusion and suspicion. Claims that the crowd was small and the violence minor were quickly belied by photographs of a soldier leaping from the turret of his Warrior armoured vehicle, his uniform burning from a petrol bomb. British troops were said to have emerged largely unscathed, only for it to emerge later that one was flown home in a serious condition.

Not only did it appear that lethal force had to be used to suppress the riot, causing an unknown number of Iraqi deaths, it was also claimed that the two undercover men had opened fire when they were stopped at a police roadblock, killing at least one policeman. There were also sharply conflicting accounts of why troops crashed into the station: to determine where the pair were, according to one version, or to rescue a negotiating team, according to another. The surveillance team had been handed over to militants and were found at a house in the district, the military said, but Iraqis denied this, saying the building was within the compound.

Whichever details are correct, the result has been a rupture in whatever trust existed between the civil authorities and the military occupiers in Basra. British troops kept out of the centre of the city in the wake of the violence. "As the threat increases ... we don't take as many risks," said one private. "We keep things to a minimum."

The affair has crystallised long-held suspicions that Britain has largely "kept the lid" on southern Iraq by avoiding American-style confrontation, at the price of allowing increasingly sinister forces to gain a foothold. These forces are still a long way from having control, but Britain's problem is that it has responsibility for the region without having real power. As one soldier put it: "There are heightened tensions because of the constitution and perceived lack of progress - various factions have been complaining about that. At the end of the day we are at the end of the line: blame the security forces."

Conspiracy theories, always rife in Iraq, have been fuelled dramatically by last week's events, according to Mazin Younis of the Iraqi League, an alliance of Iraqi exiles based in Britain. He has close contacts with Basra. "Everyone you talk to [thinks the two undercover men] were up to something very bad... to kill somebody or destroy a building, and let us battle against each other," he said.

"Being in civilian clothing, wearing Arab clothes, made them look like spies. In Iraq, when you mention the word spy, people really get agitated. Even under Saddam Hussein, people were patriotic, they didn't like foreign spies in their country. So this image is very much of clandestine and secretive action." [...]

WASHINGTON - Crowds opposed to the war in Iraq surged past the White House on Saturday, shouting "Peace now" in the largest anti-war protest in the nation's capital since the U.S. invasion.

The rally stretched through the day and into the night, a marathon of music, speechmaking and dissent on the National Mall. Police Chief Charles H. Ramsey, noting that organizers had hoped to draw 100,000 people, said, "I think they probably hit that."

Speakers from the stage attacked President Bush's policies head on, but he was not at the White House to hear it. He spent the day in Colorado and Texas, monitoring hurricane recovery.

In the crowd: young activists, nuns whose anti-war activism dates to Vietnam, parents mourning their children in uniform lost in Iraq, and uncountable families motivated for the first time to protest.

Connie McCroskey, 58, came from Des Moines, Iowa, with two of her daughters, both in their 20s, for the family's first demonstration. McCroskey, whose father fought in World War II, said she never would have dared protest during the Vietnam War.

"Today, I had some courage," she said.

While united against the war, political beliefs varied. Paul Rutherford, 60, of Vandalia, Mich., said he is a Republican who supported Bush in the last election and still does - except for the war. [...]

Thousands of people attended smaller rallies in cities on the West Coast, including Los Angeles, San Diego, San Franciso and Seattle.

In Washington, a few hundred people in a counter demonstration in support of Bush's Iraq policy lined the protest route near the FBI building. The two groups shouted at each other, a police line keeping them apart. Organizers of a pro-military rally Sunday hoped for 10,000 people.

Ramsey said the day's protest unfolded peacefully under the heavy police presence. "They're vocal but not violent," he said.

Arthur Pollock, 47, of Cecil County, Md., said he was against the war from the beginning. He wants the soldiers out, but not all at once.

"They've got to leave slowly," said Pollock, attending his first protest. "It will be utter chaos in that country if we pull them out all at once." [...]

The protest in the capital showcased a series of demonstrations in foreign and other U.S. cities. A crowd in London, estimated by police at 10,000, marched in support of withdrawing British troops from Iraq. Highlighting the need to get out, protesters said, were violent clashes between insurgents and British troops in the southern Iraq city of Basra.

In Rome, dozens of protesters held up banners and peace flags outside the U.S. Embassy and covered a sidewalk with messages and flowers in honor of those killed in Iraq.

Cindy Sheehan, the California mother who drew thousands of demonstrators to her 26-day vigil outside Bush's Texas ranch last month, won a roar of approval when she took the stage in Washington. Her 24-year-old son, Casey, was killed in Iraq last year.

"Shame on you," Sheehan admonished, directing that portion of her remarks to members of Congress who backed Bush on the war. "How many more of other people's children are you willing to sacrifice?

She led the crowd in chanting, "Not one more."

Separately, hundreds of opponents of the World Bank and International Monetary Fund danced to the beat of drums in the Dupont Circle part of the city before marching toward the White House to join the anti-war protesters.

Supporters of Bush's policy in Iraq assembled in smaller numbers to get their voice heard in the day's anti-war din. About 150 of them rallied at the U.S. Navy Memorial.

Gary Qualls, 48, of Temple, Texas, whose Marine reservist son, Louis, died last year in the insurgent stronghold of Fallujah, asked: "If you bring them home now, who's going to be responsible for all the atrocities that are fixing to happen over there? Cindy Sheehan?"

BAGHDAD - Women's rights activists in Iraq say rising extremism is restricting their freedom, even as the country prepares to vote on a constitution that is touted as one of the Arab world's most progressive regarding women.

"Women cannot walk freely out in the street," said activist Ban Jamil, who directs the Rasafa Branch of Assyrian Women Union, a local non-governmental organisation in Baghdad.

"Women face lack of respect when they walk uncovered," said Jamil, a Christian, who said women are insulted if they show too much skin or walk in public without wearing the Islamic veil, or hijab, to cover their hair.

She blamed "imported extremist doctrines, which were never experienced in the past" for the new restrictions.

The tide of Islamisation has risen in Iraq as fundamentalist Shiite parties have come to power following the ouster of former dictator Saddam Hussein.

Although not enforced by the newly established laws, which were written under US patronage, a conservative dress code is widely observed in much of the war-torn country.

But conservative dressing in Iraq is not as universally strict as in neighbouring Shiite Iran, or ultra-conservative Sunni Saudi Arabia, where women have to cover from head-to-toe when in public.

Dressing modestly in trousers and a long-sleeved shirt -- more likely with a colourful headscarf -- is common among Iraqi women.

Older or very conservative women often wear the traditional black abaya, a kind of loose-fitting, modest dress.

But short sleeves and skirts which were accepted in the past are hardly seen, even in the scorching heat of Baghdad's summer.

"We cover and change the way we dress unwillingly due to pressure," said Jinan Mubarak, a Muslim who heads the Iraqi Centre for Training and Employing Women in Baghdad.

She said some neighbourhoods are off-limits for women if unveiled, saying that women like herself are forced to change their behaviour in such environments.

Iraqi state television -- a shopwindow of the new regime -- allows some female presenters to appear unveiled, despite a clear Shiite influence in its programmes.

However, religious zealots who were curbed under Saddam's secular grip can operate freely now, as evidenced by one notice billboarded in a Baghdad street near a church, Jamil said.

"To all unveiled Muslim sisters and Christian sisters: You should wear a veil because Virgin Mary used to be veiled," it said.

Women are also concerned that the American influence in running post-Saddam Iraq plays a major role in protecting women rights, and that a future departure of US troops might result in further radicalisation.

"This might regrettably be the case, as much as we would like to see the Americans out of Iraq," said Mubarak.

US Ambassador to Iraq Zalmay Khalilzad has called Iraq's draft constitution the most progressive document in the Muslim world, claiming it ensured women's rights.

"Women have the right to participate fully in public activities," he said in August, pointing out that 25 percent of parliament seats were reserved for women.

But activists say that the current female MPs do not represent women's advocates and were brought in by male-dominated political parties to fill the 25 percent quota.

"These were voted in to fill the quota... None of them serves in the politburo of any of their parties... They are mere mouthpieces," Jamil said.

"We fear the same might happen in the next elections," she added, claiming that independent women have very slim chance of making it into the national assembly.

Several vocal women MPs speak out during live-broadcast parliament sessions and criticise openly the performance of governmental departments, although they are all first-timers.

Eighty-seven women were elected to parliament in the January 30 elections. One has since been killed by insurgents.

MEMPHIS, Tenn. - An American contract worker who was kidnapped in Iraq and held more than 10 months says in an interview that his captors kept him blindfolded and bound throughout the ordeal.

Roy Hallums, 57, described his experience to "60 Minutes" reporter Lesley Stahl in a segment that will air Sunday on CBS.

Hallums also said the motive behind his kidnapping was ransom but he refused to give his captors contact information for his family to spare them from having to negotiate.

Hallums was rescued Sept. 7 by coalition troops from a 4-foot-high crawl space under a farmhouse. He returned to his hometown of Memphis two days later to a joyous family reunion.

"When I saw him come down off the plane, it was the happiest moment of my life," his ex-wife, Susan Hallums, told The Associated Press earlier this month.

Hallums, who worked for a contractor supplying food to the Iraqi Army, was captured Nov. 1 during an armed assault on the Baghdad compound where he lived. According to a release from CBS, he said that his captors used beatings to force him to criticize President Bush in a videotape.

On the video that was monitored in Iraq in January, Hallums was seen with a rifle pointed at his head.

"I am please asking for help because my life is in danger because it's been proved I worked for American forces," he said on the video. "I'm not asking for any help from President Bush because I know of his selfishness and unconcern for those who've been pushed into this hellhole."

Hallums told "60 Minutes" that he believed the captors were related, ran "a family business" and were trying to get ransom money.

The kidnappers tried to force Hallums to give them a phone number for his family so they could ask for money, but Hallums did not reveal that information.

"I knew if I gave them the number, they would call them and ask for money," Hallums said. "I didn't want (my family) to deal with a call like that."

While he was missing, his ex-wife and two daughters set up a Web site, called world leaders, raised money for information and held candlelight vigils.

According to CBS spokesman Kevin Tedesco, the taped interview will show that the coalition unit that rescued Hallums had information that led them to the entrance of the crawl space, which was hidden by a refrigerator.

The FBI has been speaking with Hallums since his return to the United States, according to daughter Carrie Anne Cooper. She also said that the FBI was instrumental in the investigation into his kidnapping.

"I'm not totally here yet," Hallums said in the interview, "because that was my reality for 10 months."

LAS VEGAS - A man suspected of killing two tourists and injuring 12 others on the Las Vegas Strip told police he steered his car into the crowd on the sidewalk because they were staring at him like demons.

Stephen M. Ressa, 27, also told police he saw people with their hands in their pockets and thought they might be armed with guns, according to an arrest report obtained Friday by The Associated Press.

"They were staring at him like they were 'demons,'" the report said. "Ressa admitted he became angry at them, and intentionally steered the vehicle toward them."

Ressa, of Rialto, Calif., was arrested Wednesday evening shortly after the car barreled through the crowd and crashed into a cement barrier in front of Bally's hotel-casino. He remained jailed without bail on suspicion of murder and attempted murder.

During two interviews with police, Ressa told detectives he had borrowed his mother's car and drove to Las Vegas, where he spent a few days gambling at various casinos and slept in the car.

Although Ressa told police he had a drug and alcohol problem, he said he had used neither Wednesday. He told police he had been prescribed medication, but had stopped taking it.

Results of alcohol and drug tests were pending.

Rialto police Detective Sgt. Reinhard Burkholder said Thursday that Ressa was wanted for questioning in an assault on his mother, 54.

"He punched her numerous times in the face and choked her into unconsciousness and stood over her with a butcher knife," Burkholder said.

Earlier, Deputy Police Chief Greg McCurdy told reporters that Ressa appeared lucid and correctly answered questions about his ability to determine right and wrong. But Ressa's statements were "bizarre in nature," McCurdy said.

BRUSSELS, Belgium - Half of European citizens speak a second language, according to a European Union survey released Friday.

The poll, conducted in June across Europe, found that tiny Luxembourg had the highest percentage of bilingual citizens, with 99 percent of those questioned saying they could master a conversation in a second language.

Hungary had the lowest number with 29 percent of its citizens able to speak another language. Britain was second last with 30 percent.

The survey also found that almost eight out of 10 students [80 percent] - ages 15- 24 - can have a normal conversation in at least one foreign language.

In the United States, by contrast, 9 percent of Americans speak both their native language and another language fluently, according to a U.S. Senate resolution designating 2005 the "Year of Foreign Language Study."

In the European survey, English was identified by 34 percent of respondents as their second language, followed by German which was a second language for 12 percent, then French which was spoken as a second language by 11 percent, according to the survey.

Spanish and Russian are spoken as a second language by 5 percent of those surveyed. Russian has become more common due to its widespread use in the 10 mostly eastern European countries that joined the EU last year.

It is not, however, listed as one of the EU's 21 official languages, and so receives no funding from EU education programs.

The poll, which surveyed 29,328 people across the 25-nation EU, Turkey, Croatia, Bulgaria and Romania, was released to coincide with European Day of Languages on Monday, which aims to promote the study of languages. The survey had a margin of 3.1 percentage points.

On the fourth anniversary of the September 11th attacks, Laura Knight-Jadczyk announces the availability of her latest book:

In the years since the 9/11 attacks, dozens of books have sought to explore the truth behind the official version of events that day - yet to date, none of these publications has provided a satisfactory answer as to WHY the attacks occurred and who was ultimately responsible for carrying them out.

Taking a broad, millennia-long perspective, Laura Knight-Jadczyk's 9/11: The Ultimate Truth uncovers the true nature of the ruling elite on our planet and presents new and ground-breaking insights into just how the 9/11 attacks played out.

9/11: The Ultimate Truth makes a strong case for the idea that September 11, 2001 marked the moment when our planet entered the final phase of a diabolical plan that has been many, many years in the making. It is a plan developed and nurtured by successive generations of ruthless individuals who relentlessly exploit the negative aspects of basic human nature to entrap humanity as a whole in endless wars and suffering in order to keep us confused and distracted to the reality of the man behind the curtain.

Drawing on historical and genealogical sources, Knight-Jadczyk eloquently links the 9/11 event to the modern-day Israeli-Palestinian conflict. She also cites the clear evidence that our planet undergoes periodic natural cataclysms, a cycle that has arguably brought humanity to the brink of destruction in the present day.

For its no nonsense style in cutting to the core of the issue and its sheer audacity in refusing to be swayed or distracted by the morass of disinformation that has been employed by the Powers that Be to cover their tracks, 9/11: The Ultimate Truth can rightly claim to be THE definitive book on 9/11 - and what that fateful day's true implications are for the future of mankind.

Published by Red Pill Press

Scheduled for release on October 1, 2005, readers can pre-order the book today at our bookstore.