TBR News June 28, 2014

Jun 28 2014

The Voice of the White House


Washington, D.C. June 28, 2014: “ I have known, second hand of course, that some time ago, an Arab militant group stole some verola virus from a Swiss lab. One of my Russian newspaper friends was mentioning that Hezbollah had this and was planning to use it against Israel in the “very near future.”
             Unfortunately, Hezbollah does not choose to recognize that verola (smallpox) will spread and since the WHO considered it to be essentially cured, no more vaccine was made. The Russians are now making vaccine and one of the reporters was kind enough to give me enough for a shot, (which I did use as my original vaccination was probably useless)
            The death rate from smallpox is about 40% and there are no customs agencies that can prevent its spread world wide. The Russians are angry because they want to protect their citizens in foreign areas, like Israel, and the Hezbollah people won’t assist them, even though Russia has supplied them with many, many surface-to-surface missiles via Syria.

            And will the militants start this plague?
            Here is an earlier  report on a similar subject:
             Washington, D.C., October 9, 2008: “This heavily-suppressed story about the Iranian ship laden with highly radioactive waste, bound for the eastern end of the Mediterranean, is typical of how the government sits on inconvenient stories. They imposed a silence on the Forward Base Falcon disaster and have not posted all the U.S.dead in Iraq and now we have the interrupted saga of the MV Iran Deyanat being blocked from all regular media sites. The story, cut off initially by a dismissive article in late September in the ‘Long War Journal,’ a “very friendly government (DoD) entity” was renewed by an article by Brian Harring at the beginning of October. It then got a tremendous reading around the world…in the millions…but never a word in our controlled press, or government-controlled sites like ‘Wikipedia’ basically controlled in toto by the CIA.

            On August 21st, 2008, the Iranian MV Iran Deyanat, a 44468 dead weight tonnage carrier. that is  owned and operated by the Islamic Republic of Iran Shipping Lines (IRISL) – a state-owned company run by the Iranian military that was sanctioned by the U.S. Department of the Treasury for its false manifests and traffic in forbidden nuclear materials, was seized by Somali pirates to be held for their usual ransom.

            The ship had set sail from Nanjing, China, July 28, 2008 

            The Old Nanking Port of Nanjing is the largest inland port in China, yearly reaching 108.59 million tons in 2007. The port area is 98 kilometers (61 mi) in length and has 64 berths including 16 berths for ships with a tonnage of more than 10,000. Nanjing is also the biggest container port along the Yangtze River; in March 2004, the one million container-capacity base, Longtan Containers Port Area opened, further consolidating Nanjing as the leading port in the region.
            During her stay at Nanjing,  the MV Iran Deyanat was loaded primarily with eight cargo containers, lined with lead and with electronic locks. The 20 ft containers are  8’ wide, and carry a load of 48,060 lb per container. This special container cargo had a total load of 384,480 pounds which consisted of packaged of nuclear waste that originated at the Tianwan 1&2 Atomic plants from Jiangsu Province (built in 2007) Once the radiation death of many of the pirates (16) became known, reporters attempting to contact responsible officials in the Pentagon and the Department of State were told these officials refused to comment on any of the implications of the cargo. The ship’s manifest was falsified but the deadly cargo was supposed to be headed for Rotterdam and an unspecified “German client.” 
            Much of the story was covered in a London Times article which was subsequently removed from that paper’s archive and the initial story was tailored by the ‘Long War Journal,’ a website with close connections to the Department of Defense and the CIA. It tended to dismiss the entire question of a radioactive cargo and instead, discussed unspecified chemicals.
            Vice Adm. Bill Gortney, Commander, US Fifth Fleet based in Bahrain Combined Maritime Forces,  said the U.S.-led coalition patrolling the Gulf of Aden “does not have the resources to provide 24-hour protection for the vast number of merchant vessels in the region,”
            Russia said it will soon join international efforts to fight piracy off the Somalia coast.However, it will conduct its operations independently, RIA-Novosti news agency reports Navy commander Adm. Vladimir Vysotsky as saying . “We are planning to participate in international efforts to fight piracy off the Somalia coast, but the Russian warships will conduct operations on their own,” he said.
            Russian nationals are frequently among the crews of civilian ships hijacked by pirates off the Somalia coast, notes RIA-Novosti.
            At the beginning of June, the UN Security Council passed a resolution permitting countries to enter Somalia’s territorial waters to combat “acts of piracy and armed robbery at sea.”
            The American media has given no coverage of any kind to this incident,
            Russian sources have disclosed that when American Naval personnel, attached to the U.S. Fifth Fleet,  finally boarded the MV Iran Deyanat and took all of her crew, including the Iranian captain, into what was called “protective custody,” and while the opened cargo container containing Chinese atomic waste was being sealed and decontaminated, the bridge and the captain’s quarters were thoroughly searched.  An “intensive” interrogation of the initially recalcitrant captain plus documents obtained from his safe showed a truly horrifying picture to the trained naval intelligence people.
            The Deynant was not the only cargo ship to load containers of radioactive waste at Nanjing; and  two others had preceded her July, 2008 visit. The problem is that the captain did not know either the names of the two Iranian -controlled ships nor their destinations.
            His destination was the eastern end of the Mediterranean but it now appears that the ship was not intended to be blown up. Instead, the eight cargo containers were to be taken to the Israeli port of Haifa on the Mediterranean. Haifa is the largest of Israel’s three major international seaports, which include the Port of Ashdod, and the Port of Eilat. It has a natural deep water harbor which operates all year long, and serves both passenger and cargo ships. Annually, 22 million tons of goods pass through the port..In 2007, the U.S. DHS’ CBP initiated a joint security agreement with Israel whereby U.S. agents, working with Israel, would develop and install programs to protect the ports from terrorist attacks..
            CBP’s Container Security Initiative, (CSI), is a cooperative effort with host country governments to identify and screen high-risk shipments before they leave participating ports. More than 80 percent of all cargo containers destined for U.S. shores originate in or are transshipped through 55 CSI ports in North, South and Central America, Europe, Asia, Africa and the Middle East.
            CSI addresses the threat to border security and global trade posed by the potential for terrorist use of a maritime container to deliver a weapon. CSI proposes a security regime to ensure all containers that pose a potential risk for terrorism are identified and inspected at foreign ports before they are placed on vessels destined for the United States. 
            The initiative seeks to: 
             Identify high-risk containers.
            CBP uses automated targeting tools to identify containers that pose a potential risk for terrorism, based on advance information and strategic intelligence. 
             Prescreen and evaluate containers before they are shipped.
             Containers are screened as early in the supply chain as possible, generally at the port of departure. 
            Use technology to prescreen high-risk containers to ensure that screening can be done rapidly without slowing down the movement of trade.
            This technology includes large-scale X-ray and gamma ray machines and radiation detection devices. 

            If a cargo container ship sails from another port that has the U.S. –controlled CBP system, and does not stop at another port enroute, it is able to enter another port equipped with the CBP system and unload its cargo without interference. 

            Let us say that a mythical ship, the Extreme Venture, picks up a cargo at an approved port and sails off to another port that is also approved. Again, if a country or entity wanting to take a dangerous cargo to the same port, it need only paint out its name, change its radio call signs, and using the methodology instituted by the U.S., enter, for example, the port of Haifa a day in advance of the real Extreme Venture. Having passed all the approved requirements, it can enter the harbor, proceed to an assigned dock, unload its containers onto waiting trucks and sail out of the harbor without let or hindrance. And the next day when the real Extreme Venture arrives, one can expect that the security people would be in a state of frenzy. By that time, the fake Extreme venture has put yet another name on her bows and stern, run up another flag and using shipping information easily available on the internet, become another innocent cargo ship among many. 
            The American view, known to several other countries, is that as both the United States and Israel have been at the forefront of violent verbal attacks against, and threats of violence to, Iran, they are now the prime targets of what, at the worst case scenario, could amount to a commercial delivery of least 16 containers of deadly radioactive material, mixed with high explosives. 

            One of the largest cargo container ports in America, Long Beach, California, has DHS inspection teams at work on a round the clock basis but because of the huge volume of traffic, only 2% of the cargo containers can be checked thoroughly at any given time. This means that should another Iranian cargo container, sailing under a false flag and with a false manifest, dock at Long Beach and offload her deadly cargo, there is a 98% chance that it could avoid any kind of inspection, be loaded onto waiting trucks and shipped to destinations all over the United States. 

            It is extremely doubtful if the Bush administration would attack Iran but because they have been in loud support of an even louder and more threatening Israel, our useless President, [fully responsible for the deliberate removal of  vital controls over the American banking industry that has caused the boom-and-bust we are now paying for,] has, by his loud but empty threats against Iran, put millions of Americans at potential risk of a terrible death by radiation poisoning. 
            This explains the stunned silence on the subject of the Deyanat affair and the tight blackout imposed on any news of her or the purpose of her cargo of powdered death.”


Stratfor emails reveal secret, widespread TrapWire surveillance system


August 10, 2012



Former senior intelligence officials have created a detailed surveillance system more accurate than modern facial recognition technology — and have installed it across the US under the radar of most Americans, according to emails hacked by Anonymous.


Every few seconds, data picked up at surveillance points in major cities and landmarks across the United States are recorded digitally on the spot, then encrypted and instantaneously delivered to a fortified central database center at an undisclosed location to be aggregated with other intelligence. It’s part of a program called TrapWire and it’s the brainchild of the Abraxas, a Northern Virginia company staffed with elite from America’s intelligence community. The employee roster at Arbaxas reads like a who’s who of agents once with the Pentagon, CIA and other government entities according to their public LinkedIn profiles, and the corporation’s ties are assumed to go deeper than even documented.


The details on Abraxas and, to an even greater extent TrapWire, are scarce, however, and not without reason. For a program touted as a tool to thwart terrorism and monitor activity meant to be under wraps, its understandable that Abraxas would want the program’s public presence to be relatively limited. But thanks to last year’s hack of the Strategic Forecasting intelligence agency, or Stratfor, all of that is quickly changing.


Hacktivists aligned with the loose-knit Anonymous collective took credit for hacking Stratfor on Christmas Eve, 2011, in turn collecting what they claimed to be more than five million emails from within the company. WikiLeaks began releasing those emails as the Global Intelligence Files (GIF) earlier this year and, of those, several discussing the implementing of TrapWire in public spaces across the country were circulated on the Web this week after security researcher Justin Ferguson brought attention to the matter. At the same time, however, WikiLeaks was relentlessly assaulted by a barrage of distributed denial-of-service (DDoS) attacks, crippling the whistleblower site and its mirrors, significantly cutting short the number of people who would otherwise have unfettered access to the emails.


On Wednesday, an administrator for the WikiLeaks Twitter account wrote that the site suspected that the motivation for the attacks could be that particularly sensitive Stratfor emails were about to be exposed. A hacker group called AntiLeaks soon after took credit for the assaults on WikiLeaks and mirrors of their content, equating the offensive as a protest against editor Julian Assange, “the head of a new breed of terrorist.” As those Stratfor files on TrapWire make their rounds online, though, talk of terrorism is only just beginning.


Mr. Ferguson and others have mirrored what are believed to be most recently-released Global Intelligence Files on external sites, but the original documents uploaded to WikiLeaks have been at times unavailable this week due to the continuing DDoS attacks. Late Thursday and early Friday this week, the GIF mirrors continues to go offline due to what is presumably more DDoS assaults. Australian activist Asher Wolf wrote on Twitter that the DDoS attacks flooding the servers of WikiLeaks supporter sites were reported to be dropping upwards of 40 gigabits of traffic per second. On Friday, WikiLeaks tweeted that their own site was sustaining attacks of 10 Gb/second, adding, “Whoever is running it controls thousands of machines or is able to simulate them.”


             According to a press release (pdf) dated June 6, 2012, TrapWire is “designed to provide a simple yet powerful means of collecting and recording suspicious activity reports.” A system of interconnected nodes spot anything considered suspect and then input it into the system to be “analyzed and compared with data entered from other areas within a network for the purpose of identifying patterns of behavior that are indicative of pre-attack planning.”


In a 2009 email included in the Anonymous leak, Stratfor Vice President for Intelligence Fred Burton is alleged to write, “TrapWire is a technology solution predicated upon behavior patterns in red zones to identify surveillance. It helps you connect the dots over time and distance.” Burton formerly served with the US Diplomatic Security Service, and Abraxas’ staff includes other security experts with experience in and out of the Armed Forces.


What is believed to be a partnering agreement included in the Stratfor files from August 13, 2009 indicates that they signed a contract with Abraxas to provide them with analysis and reports of their TrapWire system (pdf).


“Suspicious activity reports from all facilities on the TrapWire network are aggregated in a central database and run through a rules engine that searches for patterns indicative of terrorist surveillance operations and other attack preparations,” Crime and Justice International magazine explains in a 2006 article on the program, one of the few publically circulated on the Abraxas product (pdf). “Any patterns detected – links among individuals, vehicles or activities – will be reported back to each affected facility. This information can also be shared with law enforcement organizations, enabling them to begin investigations into the suspected surveillance cell.”


In a 2005 interview with The Entrepreneur Center, Abraxas founder Richard “Hollis” Helms said his signature product “can collect information about people and vehicles that is more accurate than facial recognition, draw patterns, and do threat assessments of areas that may be under observation from terrorists.” He calls it “a proprietary technology designed to protect critical national infrastructure from a terrorist attack by detecting the pre-attack activities of the terrorist and enabling law enforcement to investigate and engage the terrorist long before an attack is executed,” and that, “The beauty of it is that we can protect an infinite number of facilities just as efficiently as we can one and we push information out to local law authorities automatically.”


An internal email from early 2011 included in the Global Intelligence Files has Stratfor’s Burton allegedly saying the program can be used to “[walk] back and track the suspects from the get go w/facial recognition software.”


Since its inception, TrapWire has been implemented in most major American cities at selected high value targets (HVTs) and has appeared abroad as well. The iWatch monitoring system adopted by the Los Angeles Police Department (pdf) works in conjunction with TrapWire, as does the District of Columbia and the “See Something, Say Something” program conducted by law enforcement in New York City, which had 500 surveillance cameras linked to the system in 2010. Private properties including Las Vegas, Nevada casinos have subscribed to the system. The State of Texas reportedly spent half a million dollars with an additional annual licensing fee of $150,000 to employ TrapWire, and the Pentagon and other military facilities have allegedly signed on as well.


In one email from 2010 leaked by Anonymous, Stratfor’s Fred Burton allegedly writes, “God Bless America. Now they have EVERY major HVT in CONUS, the UK, Canada, Vegas, Los Angeles, NYC as clients.” Files on USASpending.gov reveal that the US Department of Homeland Security and Department of Defense together awarded Abraxas and TrapWire more than one million dollars in only the past eleven months.


News of the widespread and largely secretive installation of TrapWire comes amidst a federal witch-hunt to crack down on leaks escaping Washington and at attempt to prosecute whistleblowers. Thomas Drake, a former agent with the NSA, has recently spoken openly about the government’s Trailblazer Project that was used to monitor private communication, and was charged under the Espionage Act for coming forth. Separately, former NSA tech director William Binney and others once with the agency have made claims in recent weeks that the feds have dossiers on every American, an allegation NSA Chief Keith Alexander dismissed during a speech at Def-Con last month in Vegas.


Impossible – Yet It’s Happening!


A lot of weird stuff is going down


June 25, 2014

by Justin Raimondo


Does anybody remember “Impossible – Yet It Happened!”? When I was a kid, that was my favorite part of the comics page. It was a series based on the work of Charles Fort, the chronicler of the odd, all about – well, supposedly “impossible” events that nonetheless did occur. I delighted in the unexpectedness of it, the start it gave as one contemplated events so out of the ordinary that they seemed like visitations from another dimension. It was somehow reassuring, as if to say: there’s more to this world than you – or anyone – can possibly imagine.


I mention this because “Impossible – Yet It Happened” could well serve as a headline for several major news stories over the past week or so. First off, there was Vladimir Putin’s decision to renounce his (alleged) right to intervene in Ukraine. The Russian leader asked the Duma, or Russian parliament, to revoke its resolution granting authority to move troops into the former Soviet territory.


After months of listening to news announcers hype the prospect of an “imminent” Russian invasion – which came amid reports of fierce fighting between pro-Russian “separatists” and the Ukrainian armed forces (that is, those who hadn’t already defected to the Russian side) – this veers quite close to the Realm of the Seemingly Impossible. After all, isn’t Putin a “strongman,” as he’s routinely described in the Western media? And strongmen, as we know, don’t back down, not even in the face of worldwide condemnation – which would surely have been the international reaction if and when Putin gave the Russian army its marching orders. But that’s not all….


Even more unlikely: after months of denouncing the secessionists as “terrorists,” and treating them accordingly, Kiev has declared a unilateral ceasefire and is now engaged in talks with the self-proclaimed “People’s Republic of Donetsk” and its neighbors in Slavyansk. The negotiations include OSCE representatives, the Russian ambassador to Ukraine, and Viktor Medvedchuk, a pro-Russian Ukrainian politician. The United States is conspicuous by its absence.


Gee, so I guess the eastern Ukrainians who don’t recognize the Kiev coup aren’t “terrorists” anymore. To which we might add: is Putin still a “strongman”? It seems like only yesterday that Hillary Clinton was likening him to Hitler – but can anyone imagine the failed painter and archetypal murderous tyrant renouncing his “right” to invade the Sudetenland?


Another episode in the recent slew of “Impossible Yet They Happened” anomalies is the prospect of US-Iranian collaboration to tamp down the Sunni jihadist eruption in Iraq. Apparently the issue was the occasion for a side meeting at the ongoing nuke talks. Although an Iranian spokesman immediately ruled out the possibility of joint military action, and the Americans chimed in with a similar disavowal, it looks to me like this was merely to fend off hardliners in both countries.


The Israelis aren’t buying it, either: they are so worried about this that their “Strategic Affairs” minister, one Yuval Steinitz, issued a public statement warning Washington they had better not let this soften their stance on Iranian nukes if they know what’s good for them. According to Steinitz, the US government has reassured Tel Aviv that they’re standing strong (i.e. just as unreasonable and arrogant as ever) – although the Israeli minister took the opportunity to complain that the US shouldn’t be negotiating with Tehran about anything other than the terms of surrender.


That there is now even a possibility of US-Iranian cooperation in bringing some kind of order to Iraq seems like “Impossible, Yet It Happened” material to me. First we’re on the brink of war, and then – suddenly – the gods intervene, and the world’s turned upside down.


Be warned, however, that these abrupt divine interventions don’t always augur well. Take the mysterious appearance at our southern border of more than 40,000 children, mostly under the age of fifteen, who’ve made the long and dangerous journey all the way from Central America. It’s The Camp of the Saints and the Children’s Crusade all rolled into one. These kids are being housed in hastily-constructed camps, and as I write Matt Drudge has put up one of the oddest headlines in recent years:





To which one can only respond: Really???


As to why this sudden influx of youngsters – mostly traveling without their parents – is happening no one seems to have the slightest clue. The anti-immigration folks are saying it’s due to an executive order forbidding the deportation of underage illegal immigrants. But if that’s true then why are the vast majority coming from Honduras and El Salvador – and not, say, Mexico or some other place? Pro-immigration liberals explain it by arguing they’re coming to join up with their parents, who are already here. Yet this is apparently not the case, as most news accounts I’ve seen aver the parents are staying put, and it’s the kids who are setting out on a scary odyssey all by their little selves.


Whatever is at the root of it – gang violence in El Salvador and Honduras, the lax immigration policies of the Obama administration, the phase of the moon, or some as yet unknown factor – it certainly seems as unlikely as it is shocking. We’re talking about unaccompanied children trekking thousands of miles – hordes of them. As to what the response of the US government ought to be – my libertarian ideology doesn’t give me a ready-made template to impose as a “solution” to the problem. I simply note, with no small degree of bafflement, that this is happening – an ominous portent of things to come….


Last but certainly not the least of my concerns is the news that the release of top secret National Security Agency files showing the agency spied on well-known “controversial” political figures is “imminent.” In an appearance on Fox News, Glenn Greenwald stated “You will definitely recognize some of these names and some of these people.”


I’ll understand if you knit your brow and wonder: how is this “impossible”? Well, let me tell you: it once did seem impossible, at least to me. Which brings me to the realm of the personal.


When I was in fourth or fifth grade, one morning in class – it was the first day of school – I refused to stand for the pledge of allegiance. At the teacher’s command, all the other students rose but there I was, slouched down in my seat like a juvenile delinquent, arms crossed over my chest as if to underscore my defiance. I won’t go into much more detail – it was quite a scene – but suffice to say that this just wasn’t done in the late 1950s. A few years later, perhaps – but not then, and certainly not in the upper-middle class neat-as-a-pin community where I was brought up.


After class, the teacher took me aside: from my shouted comments during the brouhaha he could see that I had some radical if inchoate political concerns (yes, even at that young age). Asked why I refused to stand the best I could come up with was “This country is no better than the Nazis!” or words to that effect. We then got into a political discussion, and it was plain to see that here was a very opinionated if fitfully-educated boy who didn’t really know what he was talking about – or did he?


I had many discussions with Mr. Poli, who was also the Social Studies teacher, and he educated me about the American system: the Constitution, the Bill of Rights, and the history that led to these great achievements unparalleled in human history. I learned from him that America is not the equivalent of Nazi Germany, that we don’t live under arbitrary rules set down by tyrants, and that we are blessed to live in freedom as long as we vigilantly guard these rights which are inherent in our nature as human beings. We might not like what’s going on in society, but instead of declaring war on The System the really radical path to take is to set out to change it.


Yes, I realize that even at that moment J. Edgar Hoover was spying on commies and others who supposedly threatened to subvert the country and inject our precious bodily fluids with ideological poison. My point is that they didn’t do it under color of law – Hoover and his cronies simply went ahead and did it. The Church Committee exposed these abuses and supposedly corrected them – unfortunately, the “reforms” it institutionalized morphed into the “legal” justification for the radical extension of Hoover’s crimes exposed by Edward Snowden.


I’ve always held to what Ayn Rand called “the benevolent universe premise,” as applied to the country in which I was born: that America is basically a healthy, relatively free society in which the promise of the Founders hasn’t been irretrievably lost. This belief was severely shaken by the Snowden revelations – and yet still I retained my stubborn faith in the basic solidity of the American system as originally conceived. After all, there was no evidence the Surveillance State had taken out after American political “dissidents” – if we can use a word that has previously described opponents of the old Soviet dictatorship.


Which brings me back to the imminent Greenwald revelations: as cynical as I pretend to be about the degree to which our Old Republic has degenerated, I’ve never really shaken the lesson Mr. Poli taught me. It has retained its persuasive power, in spite of everything, after all these years – until now.


Although we’ll have to wait and see what Greenwald has to report, from his hints it seems like my American faith has been grievously misconceived. It could be that Mr. Poli was wrong – or, perhaps, that he was just behind the times.


This is important to me because it has everything to do with my decision to become a writer, made when I was still sitting in Mr. Poli’s classroom. I had so many issues with the world at large that I had to learn to express them in language others could understand – instead of making futile gestures and getting in a world of trouble. In the framework of the free society Mr. Poli laid out for me, this strategy made sense: if I could convince the rest of the world of the utter wrongness of its philosophy, then being a writer – a political writer – was the rational course to take.


But does it make sense if the government is spying – and targeting for harassment – people such as myself? This question first arose when I learned of the FBI’s investigation into myself and Eric Garris, our webmaster – but even that did not shake my faith. Since we don’t know any of the specifics – they still refuse to release any significant documents, aside from the one already in our possession, in spite of ongoing legal efforts – I couldn’t really make a case in my own mind that countered the “benevolent universe” premise instilled in me in my youth.


If what Greenwald has to reveal is that well-known political figures, whose views are “controversial,” have been subjected to systematic surveillance by the National Security Agency – or that these actions by our government have actively undermined them in any way – then the degeneration of the American system has gone beyond anything I ever imagined.


Under these circumstances, it is impossible to be a political writer – or a political activist – whose views are outside the “mainstream.” If what Greenwald has to tell us is what I fear it is, then Mr. Poli’s lesson – that it is possible to do battle for your views and win in a fair fight – no longer applies. I might as well go into real estate, because to write and agitate on behalf of a cause considered “radical” by some is to place oneself in danger.


“Impossible – yet it happened!” Life in our “modern” world is straight out of the comics – although there are those, such as myself, who would characterize it as tragedy.


Putin: US unhappy with South Stream because it wants to deliver gas to Europe


June 24, 2014



The US opposes the Russian South Stream gas pipeline project because it wants to supply gas to Europe itself, President Putin said on Tuesday. He called the situation an “ordinary competitive struggle.”


“They do everything to disrupt this contract. There is nothing unusual here. This is an ordinary competitive struggle. In the course of this competition, political tools are also being used,” the Russian president said after holding talks with his Austrian counterpart, President Heinz Fischer, in Vienna.


“We are in talks with our contract partners, not with third parties. That our US friends are unhappy about South Stream, well, they were unhappy in 1962 too, when the gas-for-pipes project with Germany was beginning. Now they are unhappy too, nothing has changed, except the fact that they want to supply to the European market themselves,” Putin stated.


Should this happen, American gas “will not be cheaper than Russian gas – pipe gas is always cheaper than liquefied gas,” Putin stressed.


Russia and Austria have signed an agreement to construct the Austrian arm of the US$45 billion South Stream gas pipeline project, which is expected to deliver 32 billion cubic meters of Russian gas to the country, bypassing Ukraine.


But President Putin stressed that Moscow is not bypassing Ukraine for political reasons.


“These are natural steps to expand the transport infrastructure,” Putin said. “[Moscow is not] striving to bypass Ukraine.”


He reminded that the Nord Stream, South Stream, and Blue Stream projects started a while ago.


“It is wrong to always say that we are doing anything against anyone,” Putin noted. He added that Russia, just like its “partners,” can and will “create the most favorable conditions, and have contacts and contracts with many partners.”


Russia will continue “to promote our product in emerging markets,” Putin stressed.


At the same time, Austrian President Heinz Fischer hailed the project, calling the South Stream gas pipeline “expedient” and “useful.”


The joint South Stream Austria project will be 50 percent owned by Gazprom – Russia’s largest gas producer – and 50 percent owned by Austria’s OMV Group, the country’s largest oil and gas company.


Fischer stated that if anyone criticizes Austria, they should also criticize other member countries and their companies.


“I suppose that there will be no such moment when such a country as Austria will not be holding talks with a partner, which has intense relations with us, and will not be ready to negotiate with it,” the Austrian leader said.


“We know such a dialogue does not contradict any EU decision,” he added.


Construction of the Austrian section is expected to begin in 2015. The first deliveries could begin in 2017, reaching full capacity in January 2018.


OMV spokesman Robert Lechner was slightly more optimistic, saying the first South Stream deliveries to Austria could come as early as 2016.


Austria and Russia sign South Stream gas pipeline treaty


June 24, 2014



Russia and Austria have agreed on a joint company to construct the Austrian arm of the $45 billion South Stream gas pipeline project, which is expected to deliver 32 billion cubic meters of Russian gas to the country, bypassing Ukraine.


At Tuesday’s meeting in Vienna, the creation of South Stream Austria was announced.The company will be 50 percent owned by Gazprom, Russia’s largest gas producer, and 50 percent by Austria’s OMV Group, the country’s largest oil and gas company.


Construction on the Austrian section is expected to begin in 2015 and that the first deliveries will start in 2017, reaching full capacity in January 2018.


OMV spokesman Robert Lechner was more optimistic, and said the first South Stream deliveries could come as early as 2016.


In April, Gazprom and the OMV Group signed a memorandum to implement the South Stream project in Austria.

EU, Gas, Paul Scott, Putin, Russia and the global economy Russia and Austria have agreed on a joint company to construct the Austrian arm of the $45 billion South Stream gas pipeline project, which is expected to deliver 32 billion cubic meters of Russian gas to the country, bypassing Ukraine.


At Tuesday’s meeting in Vienna, the creation of South Stream Austria was announced.The company will be 50 percent owned by Gazprom, Russia’s largest gas producer, and 50 percent by Austria’s OMV Group, the country’s largest oil and gas company.


Construction on the Austrian section is expected to begin in 2015 and that the first deliveries will start in 2017, reaching full capacity in January 2018.


OMV spokesman Robert Lechner was more optimistic, and said the first South Stream deliveries could come as early as 2016.


In April, Gazprom and the OMV Group signed a memorandum to implement the South Stream project in Austria.


At Tuesday’s meeting in Vienna, OMV CEO Gerhard Roiss said that South Stream fully complies with EU legislation.


“This project- investment in European energy security- will fully comply with EU legislation,” Roiss said, as quoted by ITAR-ITASS.


There has been controversy over South Stream, as is it needs EU approval so that it doesn’t violate Europe’s ‘Third Energy Package’, which says a company cannot both own and operate pipelines within the European Union.


Bulgaria and Serbia, countries nearly 100 percent dependent on Russian gas, have faced pressure from the EU to halt construction.


Ahead of Putin’s visit to Vienna, Austrian ministers said they remained committed to Russia’s South Stream project and that they plan to speed it up.


The geopolitical conflict in Ukraine has also complicated the South Stream project, as EU energy lobbying groups are campaigning against the project, to lessen Europe’s dependence on Russia.


“So far [Austria, Ed,] takes a very clear position, avoiding pressure from the European Commission and in general, public opinion in Europe that wants to halt or even stop the project. At the same time it [Austria, Ed] has enough political clout to promote this project. It’s not Bulgaria, which on its own cannot defend itself,” Fyodor Lukyanov, Chairman of Russia’s Council on Foreign and Defense Policy, said on Monday.


South Stream will deliver gas to Europe bypassing Ukraine, which is seen as an unreliable transit state.


After switching Ukraine to a prepayment system, Russia and Gazprom fear Ukraine will start to siphon gas supplies headed towards Europe, as the country did in 2006 and 2009. Miller worries Ukraine may resort to this tactic in winter, once it runs out of its underground storage supplies of natural gas.


“If Ukraine begins to siphon off gas, we will increase supplies via North Stream, and maximize the load through Yamal-Europe,” Aleksey Miller, CEO of Gazprom, said Tuesday in Vienna.


The 2,446 km pipeline will stretch across southern and central Europe and will transport over 64 billion cubic meters of natural gas to Europe per year.


Gazprom has said the project, estimated to cost $45 billion, can be completed without any funding from international partners.


Gazprom is Russia’s largest producer of natural gas and provides roughly one third of Europe’s gas needs.


The head of the Russian Duma’s International Affairs Committee, Aleksey Puskhov, wrote on Twitter on Tuesday that “Ukraine is in a long-term phase of unpredictability. Thus, South Stream is the only guarantee of uninterrupted gas supply to Europe.”



At least 49 large military drones crashed over US since 2001 – report


June 23, 2014



A minimum of 49 Unmanned Aerial Vehicles (UAVs) operated by the US armed forces have suffered major crashes in US airspace since 2001, a worrying number considering the thousands of civilian drones set to flood American skies in the coming months.


The total was compiled by the Washington Post, which used Freedom of Information requests to obtain the data, which includes only Class A accidents – those that caused more than $2 million dollars of damage. The real number of incidents and near-misses is likely considerably higher, but the Air Force and Army refuse to provide information for smaller accidents that did not require a public investigation.


According to its own documents, the Federal Aviation Administration (FAA) is “incrementally” loosening drone regulations, allowing “safe integration” for drones, which currently predominantly operate in military airspace, and need special licenses to fly through shared airspace. Nonetheless, it estimates that there will be more than 7,500 commercial drones in US airspace by the end of the decade. According to internal Pentagon data, it also plans to launch its own military-grade drones from at least 144 sites by 2017.


Both the army and the regulators are sanguine about the prospect of a drone-filled sky.


“We’re really big into risk management. I’m comfortable with what I see with the mitigation approach that we’re taking,” said Air Force Colonel James Marshall, safety director for the Air Combat Command, pointing out that crashes have plateaued in recent years as equipment has improved, and experience mounted


“As we integrate unmanned aircraft into the national airspace system, I believe that the public expect us not only to maintain but to continue to enhance the levels of safety that we’ve been able to achieve for conventional aircraft,” Michael P. Huerta, the FAA’s administrator.


But not everyone is convinced, particularly when risks concern flying certain types of drones or launching flights over populated areas.


Most worrisome is the Predator, a legacy UAV that has not been produced since 2011. The US Air Force still operates 150 of them, with many of the craft expected to return to American soil, as the White House curtails military involvement abroad.


“The problem is that nobody is comfortable with Predator. Nobody,” an unnamed pilot said during his debriefing interview following a crash in New Mexico in 2010.


“[It’s] the most back-assedward aircraft I ever flown.”


Even Frank W. Pace, the president of the aircraft division of General Atomics Aeronautical Systems, the Predator’s maker, expressed reservations.


“You really want to be flying it over areas that aren’t highly populated,” he told the Post. “As a citizen, I wouldn’t want it to happen.”


Although so far Predators have been restricted mostly to military airspace, the Pentagon wants to broaden their use for civilian purposes, such as monitoring fires, as was the case when a Predator was dispatched to Yosemite National Park last year.


The Defense Department alone – presumably the best-qualified and most careful drone operator – currently holds over 160 licenses to use drones in shared airspace, double the amount at the beginning of the decade.


“To me, it’s appalling that they’re flying them over urban areas,” said Ed Kinane, who heads a New York pressure group called Upstate Drone Action.


“The Pentagon has been so eager to get their hands on drones, and more drones, that they’re not as good as they should be.”


The dangers stem from a combination of an immature technology, and poorly trained pilots.


Firstly, the current generation of drones does not possess proper ‘detect and avoid’ technology that could prevent mid-air collisions, a particularly relevant factor when the operator is sitting hundreds or thousands of miles away.


Secondly, drones rely on satellite signals. Excerpts from post-accident transcripts show that pilots routinely lost contact with their drone for seconds at a time, and often for minutes. Theoretically, drones revert to circling the air benignly when not piloted, but in practice, losing contact with the vehicle has often resulted in a costly crash.


Post-crash reports also show pilots – most of whom have been transferred to the drone program from conventional aircraft – ignoring the remote telemetry, failing to react promptly to unexpected situations, and being treated as a “nuisance” by recalcitrant ground control officers.


But whatever the concerns, for the Pentagon and the FAA drones are here to stay, and any crashes are wrinkles to be worked out.


“Every year we continue to make improvements. And I can say unequivocally that the Defense Department will continue to drive down the accident rate,” said Dyke Weatherington, director of unmanned warfare for the Pentagon.



A Secret Plan to Close Social Security’s Offices and Outsource Its Work


June 24, 2014

by Richard Eskow

Campaign for America’s Future


For months there have been rumors that the Social Security Administration has a “secret plan” to close all of its field offices. Is it true? A little-known report commissioned by the SSA the request of Congress seems to hold the answer. The summary document outlining the plan, which is labeled “for internal use only,” is unavailable from the SSA but can be found here.


Does the document, entitled “Long Term Strategic Vision and Vision Elements,” really propose shuttering all field offices? The answer, buried beneath a barrage of obfuscatory consultantese, clearly seems to be “yes.” Worse, the report also suggests that many of the SSA’s critical functions could soon be outsourced to private-sector partners and contractors.


Here are five insights from this austerity-minded outline.


1. This is death by jargon.


The Social Security Administration has contracted with an entity called The National Academy of Public Administration, or NAPA, to “conduct a study and submit a high-level plan proposing a long-range strategic vision.” The seven-member panel conducting the study includes current and former employees of government contractors IBM, Cisco, and Grant Thornton, as well as career bureaucrats and the editor of Government Executive magazine.


The panel’s four-page overview lays down a nearly impenetrable barrage of consultant-speak. This is a language in which “smaller workforce” means “layoffs” and “reduced physical infrastructure” is a euphemism for “closing field offices.” It is a language in which goals, objectives, strategies and tactics are reduced to a pulpy mash of undifferentiated “vision elements.” The language is rich in booster-ish phrases like this one: “Stress program integrity in everything we do.” (As opposed to, you know, not doing that.)


For most of its four pages the document’s runic language artfully dodges the question at hand, preferring instead to inform the public of such need-to-know information as the fact that “we embrace change and reward managed risk.” It is not until the final page that the bomb is dropped, surrounded by a cloud of verbal decoys. The key phrase: “Our communication and business practices enable a dispersed workforce that is no longer working in centralized, traditional offices.”


“Centralized, traditional offices.” Or, as the rest of the world calls them, “offices.”


The document suggests that Social Security’s administrative functions will be transferred online, allowing for human contact only “in very limited circumstances.” Even in those cases it appears that the default options will be telephone calls and online chats, together with rare meetings with personnel who may be housed in the offices of other agencies – or, conceivably, private corporations.


2. The SSA isn’t resisting congress’ brutal cuts.


Despite the fact that a Democratic president is running the executive branch, the Social Security Administration appears to be accepting the harsh budget cuts imposed upon it by Congress with an air of surprising passivity. This is puzzling. Social Security is an enormously successful and popular program. Historically only conservative Republicans have urged cuts to its administrative budget. Those cuts are already frustrating the public and undermining public confidence in the program. (For more on this topic see the Special Senate Subcommittee on Aging, Mark Miller of Reuters, Michael Hiltzik of the Los Angeles Times, Hiltzik again, and ourselves.)


And yet, these needless and harmful cuts are being accepted as a fait accompli by both the NAPA panel and the Social Security Administration itself. The SSA’s “Agency Strategic Plan for 2014-2018,” which is published where the “strategic vision” document might logically be found, glosses over current and impending staffing reductions with language like this: “In the coming years, as we prepare for more employee retirements and continued budget constraints, we will develop and implement a strong succession plan to prepare for the new skills, competencies and work styles of a leaner, modern Federal workforce.”


English translation: We are downsizing for budget reasons but would rather not say too much about it.


Then there’s this: “The size of our workforce has declined by about 11,000 employees since the beginning of FY 2011 and we expect this trend to continue … we estimate that more than 21,000 of our employees will retire by FY 2022. A shrinking workforce affects our ability to meet the needs and expectations of our customers and stakeholders.”


English translation: Our staffing budget keeps getting slashed and our service will continue to decline accordingly.


The fact that neither the SSA, the administration, nor the president himself are publicly fighting these brutal cuts is a betrayal of Social Security’s promise. That betrayal is made even more acute by the fact that cuts to Social Security’s administrative budgets do not help the deficit in any way, since the SSA is fully funded from Social Security’s revenues.


3. They intend to do more outsourcing, too.


One of the bitter ironies of the bipartisan austerity craze has been the fact that, while there has been an assault on government jobs, there has been an equal or greater push to transfer government revenues to the private sector using lucrative, cost-inflating “privatization” contracts.


That seems to be what somebody has in mind for Social Security’s future, too. One of the 29 “vision elements” in the Vision 2025 document states that service delivery should be “integrated across SSA programs and with external partners …” It goes on to state that all support functions for SSA should be “provided through a shared services model (e.g., within SSA, across government, and by contract).” (Emphases ours.)


No descriptions are offered for those “external partners” or the recipients of those “shared services” contracts, but the message seems clear: they’re closing the field offices, laying off employees, and shifting the work to other agencies as well as profit-driven (and therefore ultimately costlier) private enterprises.


The choice of private partners thus far isn’t encouraging. The user portal informs people signing up for online access that they may be subject to an eligibility verification by Experian. That’s the credit-rating firm that is currently the subject of a multistate investigation, as well a a lawsuit on behalf of the people of Mississippi. The complaint, which is unrelated to Social Security, alleges that Experian knowingly made “sweeping errors” on consumers’ credit records and repeatedly violated consumer protection laws.


4. They expect people to do everything on the Internet – and their website is terrible.


The “vision” document states it plainly: “We … use online, self-service delivery as our primary service channel.” They also expect to “automate processes to maximize operational efficiency.” “Direct service options (e.g. in person, phone, online chat, video conference)” will only be available “in very limited circumstances.”


That’s a bad idea. Seniors use the Internet far less than other people. Only 57 percent of people over 65 are online, as opposed to a nationwide average of 87 percent, according to a recent Pew study. Disabled people, Social Security’s other major user group, can also experience difficulties accessing the Internet. Minorities and low-income people, many of whom depend on the SSA’s assistance, are also less likely to be web-connected.


This idea gets even worse when one attempts to use the SSA’s website, as we did recently. We will document that tragicomic misadventure in greater detail shortly, but the short version is this: although I have led very large-scale information technology projects, it took me several days to successfully enroll in the SSA website. The delays were caused by a combination of downtime and poor web design.


The website is confusing, even for tech-savvy and (relatively) youthful users. Imagine how daunting it must be those who aren’t comfortable with computers, those whose cognitive skills may be in decline, and those who have lost the full use of one or more senses. To make matters worse, the SSA site explicitly forbids would-be users from allowing others to navigate the process on their behalf.


On the other hand, converting more of Social Security’s functions to website technology could be result in a very lucrative payday for government contractors like… well, like IBM and Cisco.


5. They’re downsizing just as demand grows.


The “Vision 2025” agenda has a number of other problems. For example, it calls for ending the practice of retaining employees with specialized knowledge of specific programs. They are to be replaced with “generalists,” even though applicants and beneficiaries are more likely to obtain useful information from employees with more specific knowledge. And yet, the “vision” calls for “empowering” employees even as it proposes to deprive them of the specialized knowledge they need to use that power wisely.


But the most important takeaway is this: They’re closing field offices, downsizing their workforce, and trying to force everyone through an inadequate Internet portal. That’s all in an effort to reduce Social Security services at a time when the need is about to grow dramatically.


The scare rhetoric about the cost of baby boomers’ benefits is just that: scare rhetoric. Any long-term imbalances are easily rectified through one or two simple and equitable adjustments (like lifting the payroll tax cap). But there is no question that the number of Social Security applicants and recipients is going to increase dramatically, and with them will come a greater administrative workload. The SSA’s own website lays out the numbers: “By 2033, the number of older Americans will increase from 46.6 million today to over 77 million.”


The SSA is perfectly willing to cite that figure as part of an overly fearmongering set of statistics meant to raise false alarms about solvency. But when it comes time to craft an appropriate plan for the program’s administrative future, statistics like that are nowhere to be found. Instead, the SSA continues to close offices and plans even more dramatic cuts to its workforce.


It has become increasingly clear that plans are underway at the SSA to impose more needless cuts on SSA’s budgets and render the program’s benefits increasingly inaccessible to Americans who have earned them. The American Federation of Government Employees is currently on a campaign that encourages people to register their objections to this troubling plan.


Police ready to abide by court’s cellphone ruling


June 26 2014

by Tami Abdollah  



            LOS ANGELES (AP) Officers are being briefed during roll calls, new procedures are in place, and prosecutors are considering the effect on potentially thousands of pending court cases after the Supreme Court’s ruling that restricts police searches of cellphones.


From Los Angeles to New York, and in San Diego, Chicago and Houston, officials met to discuss Wednesday’s unanimous ruling that could make it harder for officers to quickly find incriminating evidence. The ruling prohibits law enforcement from searching an arrestee’s cellphone without a warrant unless a person’s safety or life may be in danger.


Because cellphone technology has so rapidly advanced over the last decade, more information than ever before — including personal documents, photos and emails — is now stored on these devices. For investigators, they can be a treasure trove of suspects’ pictures with fellow gang members, not to mention text messages and call records that help police find accomplices or victims.


Few, if any, in law enforcement circles were surprised by the high court’s ruling, and they said many cautious investigators were already getting warrants to ensure evidence doesn’t get tossed out of trials. But they also universally acknowledged that it would make their jobs more difficult, especially for the rank-and-file patrol officer.


“It’s going to be more cumbersome, it’s going to take more work, it’s going to take more time,” said Los Angeles County sheriff’s Lt. Kent Wegener, of the Major Crimes Bureau. Wegener said his investigators routinely seek search warrants for their cases.


            In Houston, prosecutors were already treating cellphones as personal property with privacy rights and advising police officers that if they weren’t given permission, they’d need a search warrant to access the devices, said Bill Exley, a prosecutor in the Harris County district attorney’s office.


The Constitution’s Fourth Amendment requires police generally to have a judge sign a warrant that’s based on “probable cause,” or evidence that a crime has been committed. But cellphones have been treated like any other item in an arrestee’s possession, meaning they could be examined to ensure the officer’s safety and prevent the destruction of evidence.


The Supreme Court’s decision examined two cases that arose after arrests in San Diego and Boston. In San Diego, police found indications of gang membership when they looked through a defendant’s smartphone, and prosecutors used video and photographs from the phone to persuade a jury to convict him of attempted murder and other charges. In Boston, police used the call log on an arrested man’s flip phone to lead them to his home, where they found drugs, a gun and ammunition.


Thousands of pending court cases could be altered or dropped because of what would now be considered illegally obtained evidence as a result of the decision, said Oregon defense attorney Bronson James, who authored an amicus brief for the plaintiffs. Whether that’ll happen is unclear, and prosecutors are working to limit the case’s retroactive impact.


The ruling may also ultimately challenge law enforcement’s use of other technology, James said, such as the U.S. government’s bulk data collection or the “Stingray,” a device that sweeps up cellphone data in a given area.


It can take anywhere from a few hours for a judge to sign off on a state search warrant to a few days for a federal one.


Though the ruling provides leeway for situations where a person’s safety or life is in danger, authorities have concerns about whether information or opportunities might be missed. The San Diego County district attorney’s office has had conversations with law enforcement on how to expedite search warrant requests when only a couple judges might be on call at night or over the weekend.


San Diego County’s chief deputy district attorney, Summer Stephan, said human traffickers often run their businesses from their cellphones, arranging prices and schedules for girls and customers by text message.


Though the ruling allows for emergency situations, “sometimes you don’t know if you have that until you look,” Stephan said. “You don’t know if the girl you were already able to rescue is the only girl until you look at the phone and see if there’s communication with another girl.”


The decision addresses worries that information may be erased remotely, allowing police to seize the cellphone and turn it off or remove its battery. Police can also place it in a special bag to isolate it from radio waves.


Many departments, including Michigan State Police, are already giving those bags to officers, said Douglas Godfrey, a former Kings County, New York, prosecutor. But the bags aren’t necessarily distributed widely to patrol officers or in great supply. Such new measures would require a financial investment and training.


“It certainly is true that if the police are just allowed to rummage through the cellphone of any arrestee without a warrant they can find all kinds of things that might be helpful,” said David Sklansky, a UC Berkeley law professor who’s written on Fourth Amendment issues. “The court recognizes that, but the court says that privacy is not costless. Sometimes honoring the Constitution means that law enforcement does not have advantages that it otherwise would have.”


German government cancels Verizon contract in wake of U.S. spying row


June 26, 2014



BERLIN – The German government has cancelled a contract with U.S. telecoms firm Verizon Communications inc as part of an overhaul of its internal communications, prompted by revelations last year of U.S. government spying.


Reports based on disclosures by former U.S. intelligence contractor Edward Snowden alleged Washington had conducted mass surveillance in Germany and had even eavesdropped on Chancellor Angela Merkel’s mobile phone.


Berlin subsequently demanded talks with Washington on a “no-spy” deal, but these collapsed after the United States appeared unwilling to give the assurances Germany wanted.


Germany also launched an overhaul of its internal communications and secure government networks. This is one of the first actions involving a U.S. firm to result.


“The pressures on networks as well as the risks from highly-developed viruses or Trojans are rising,” Germany’s Interior Ministry said in a statement on Thursday.


“Furthermore, the ties revealed between foreign intelligence agencies and firms in the wake of the U.S. National Security Agency (NSA) affair show that the German government needs a very high level of security for its critical networks.”


The government said Deutsche Telekom AG would replace services provided by Verizon, and noted Deutsche Telekom was already responsible for the most sensitive communications between ministries or between the government and German intelligence agencies.


Information on the value of the contract was not immediately available.


According to reports and documents published last year, Verizon was obliged to turn over international and domestic calling records of its customers to U.S. intelligence agencies.


Verizon is the second-biggest U.S. telephone company behind AT&T Inc in terms of revenue.


Detlef Eppig, head of Verizon’s German unit Verizon Germany said on Thursday: “Verizon Germany is a German company and we comply with German law.”


Verizon did not receive any demands from Washington in 2013 for data stored in other countries, the company said.


“The U.S. government cannot compel us to produce our customers’ data stored in data centres outside the U.S., and if it attempts to do so, we would challenge that attempt in a court,” it added.


            The firm declined to comment on whether there had been requests in previous years.


(Reporting by Thorsten Severin; Writing by Alexandra Hudson; Editing by David Holmes)


U.S. drought could spark economic water warfare


June 26, 2014

by Kevin Allison and Antony Currie



            The withering drought afflicting California and the southwest United States could spark economic warfare over water. Scarce rains have left large swaths of the country dry for, in some areas, several years. That’s happening as industries from beverages to semiconductors grow concerned about whether they will have adequate access to water in the future. For cities and states situated around the Great Lakes, as well as water technology firms, it presents a flood of opportunities.


Access to water may have been overlooked by the Risky Business report on environmental threats to the U.S. economy launched earlier this week by, among others, former Goldman Sachs and U.S. Treasury boss Hank Paulson and ex-New York Mayor Michael Bloomberg. But executives at the annual World Economic Forum in Davos have ranked it one of the three biggest global risks for the past two years. The area encompassing Arizona, New Mexico and other states regularly tops surveys of regions at risk of water stress, along with sub-Saharan Africa and China.


Until recently, though, U.S. companies routinely relegated water scarcity to the fine print of risk factors in regulatory filings. Dealing with the issue has cost some companies $400 million, according to the Carbon Disclosure Project.


Just last week, the U.S. Chamber of Commerce Foundation hosted a webinar on the topic, highlighting recent research by environmental research group Pacific Institute and Vox Communications. They surveyed more than 50 U.S. companies and found almost 60 percent reckon problems with water will affect both their business growth and profitability by 2018. Some 90 percent expect water to be a board-level issue by then. More than three-fifths of respondents already factor availability into where to locate their facilities; some 85 percent expect to do so within four years.


Great Lakes states including Ohio and Illinois are hoping that will bring business flowing in. The basin straddling the U.S.-Canadian border boasts one-fifth of the world’s fresh surface water. Lakes Superior, Huron, Michigan, Erie and Ontario together hold about 22,000 cubic km of fresh water, enough to cover the entire lower 48 U.S. states to a depth of about 3 meters. And the region has industrial cities and an extensive port, rail and highway network.


Indiana, for example, is gearing up to market itself as a region “with abundant water supplies,” according to Vox Global’s Tony Calandro. Milwaukee, Wisconsin, has aggressively been positioning itself as a world water hub for some time. America’s historical brewing capital wants to reinvent itself as a magnet for water technology startups. Its local universities have established freshwater research programs. The Water Council, a local umbrella group, runs a seed-funding competition and provides office space for water entrepreneurs.


Chicago is already a national center for water-intensive pharmaceuticals and food processing, which together account for tens of thousands of local jobs. The Windy City also shares its smaller northern neighbor’s ambitions, but is playing catchup.


There are challenges, though. High taxes in Chicago, for one, may act as a deterrent. Newcomers would have to show they could operate without draining or spoiling the watershed. Nestlé, the global food giant, spent years fighting local opposition to a Michigan bottled-water factory in the 2000s. Water-hogging refineries and paper mills may face political opposition from residents who use the lakes for drinking water and recreation.


The tech industry may be a better prospect. Microchip foundries and server farms require huge amounts of water. They don’t, though, come with the same public relations and environmental baggage, in part because they don’t contaminate the water they use and don’t remove all of it permanently. Intel, for example, returns 87 percent of it to the environment. Luring just a fraction of the global semiconductor industry’s roughly $300 billion of annual revenue could make a difference to a city like Chicago, which is forecast to run a budget deficit of almost $340 million this year.


There’s certainly money to be made from being a water hub. A combination of arid conditions and a recent years-long drought cajoled Israel to put even more emphasis on finding ways to conserve. Its water technology exports jumped from $700 million in 2006 to $2 billion in 2010 as a result and may hit $2.7 billion by 2015, Goldman Sachs estimates. Agricultural exports, meanwhile, rose to $2.1 billion in 2011.


That should serve as encouragement to companies and governments in America’s water-scare regions as well as the water-plentiful Great Lakes. Relocating is, after all, impractical for some businesses, like agriculture and service industries. AT&T, for example, needs to be where its customers are. It uses 3.3 billion gallons of water a year, almost a third of which goes to cool its buildings. By deploying relatively cheap technology, the telecoms company cut its usage by up to 40 percent.


Such simple solutions may help keep companies in place. The harder it gets – and the more scarce the resource – the more likely it is that states use water as an economic weapon.


This item has been corrected to read “3.3 billion gallons” not “3.3 billion cubic meters” in the penultimate paragraph.


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