Meet the Overseas Contingency Operations Account – Washington D.C.’s Crony Capitalist War Slush Fund

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Senate Armed Services Committee Chairman John McCain has called it a “gimmick,” and Democrats complain that larding up the separate war funding bill with extra spending amounts to an “abusive loophole.” Yet so far, the massive increase is likely to remain in this year’s budget.

Another major criticism of the process has been its common use to fund favored projects and other items not directly tied to the war — a trend that has steadily grown over the years as the wars in Iraq and Afghanistan dragged on and the Pentagon loosened the definition of war-related spending.

From 2001 to 2014, nearly $71 billion of nonwar funding was provided through war appropriations, according to the Pentagon’s own definition, the nonpartisan Congressional Research Service reported in December.

– From the Politico article: War Budget Might be Permanent ‘Slush Fund’

Many people will read this post, and posts like it, and shrug their shoulders saying that there’s always going to be corruption. True; however, there are degrees of corruption. When empires such as the U.S. attain a certain level of corruption that reaches the point where it becomes engrained within the fabric of society, and you couple that with zero accountability for the super rich and powerful, you have the ingredients for societal collapse. We are rapidly approaching this point, and I personally don’t think there’s any way to stop it.

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Another Oligarch Preaches to the Peasants – Charlie Munger Says “Prepare for Harder World”

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While several exceptionally wealthy and successful people have admirably come out and spoken passionately of the broken nature of financial markets and the political system, as well as the threat this poses to society in general (think Paul Tudor Jones and Nick Hanauer), there have been several examples of oligarchs coming out and conversely demonstrating their complete disconnect from reality, as well as a disdain for the masses within a framework of incredible arrogance.

I’ve commented on such figures in the past, with the two most popular posts on the subject being:

A Billionaire Lectures Serfs in Davos – Claims “America’s Lifestyle Expectations are Far Too High”

An Open Letter to Sam Zell: Why Your Statements are Delusional and Dangerous

The latest example comes from Charlie Munger, Warren Buffett’s right hand man, who tends to demonstrate an incredible capacity for verbal diarrhea. Recall his commentary on gold: “gold is a great thing to sew onto your garments if you’re a Jewish family in Vienna in 1939.”  

Moving along, Mr. Munger provided some typically insensitive commentary at an event yesterday in Los Angeles. Bloomberg reports that:

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Government Report Finds DEA Agents Had “Sex Parties” With Prostitutes Hired By Drug Cartels

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Although some of the DEA agents participating in these parties denied it, the information in the case file suggested they should have known the prostitutes in attendance were paid with cartel funds. A foreign officer also alleged providing protection for the DEA agents’ weapons and property during the parties, the report said. The foreign officers further alleged that in addition to soliciting prostitutes, three DEA SSAs [special agents] in particular were provided money, expensive gifts, and weapons from drug cartel members.

* A deputy U.S. Marshal “entered into a romantic relationship” with a fugitive’s spouse and would not break off the relationship for more than a year, even after being told by supervisors to end it.

* An ATF “Director of Industry Operations” had “solicited consensual sex with anonymous partners and modified a hotel room door to facilitate sexual play.” The ATF employee even disabled a hotel’s fire detection system, and when caught by the hotel, said he had done it before.

– From the Politico article: DEA Agents Had ‘Sex Parties’ with Prostitutes, Watchdog Says

There’s no agency in government more vehemently opposed to ending the immoral and counterproductive “war on drugs” than the Drug Enforcement Administration (DEA). Now we know why.

From Politico:

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True Story – U.S. Military Lost Equipment from $750 Million Program, Some Ended up on eBay and Craigslist

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The Pentagon lost track of sensitive equipment from a $750 million program to help U.S. soldiers spot roadside bombs — and some of it wound up for sale on eBay, Craigslist and other websites, according to a Navy intelligence document obtained by The Intercept.

The report went on to state that “more than 32,000 pieces of equipment were issued” under the program, and the items “are NOT for civilian use and are controlled under the International Traffic in Arms Regulations.” The devices went missing because the military units had poor control over equipment distributed to them, according to the intelligence brief.

JIEDDO has been heavily criticized over the years for expending large sums of money without attaining clear results. According to a 2012 report by the Government Accountability Office, JIEDDO had spent over $18 billion yet lacked an effective way to oversee its programs.

– From the Intercept article: Sensitive Military Gear Ended Up on eBay, Craigslist

Another day, another example of the inconceivable incompetence of the U.S. government.

Just yesterday, I published a post titled, Can’t Make This Up – U.S. Providing Aid in Fight Against ISIS in Iraq Alongside Iranian Troops. Here’s an excerpt in case you missed it:

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Can’t Make This Up – U.S. Providing Aid in Fight Against ISIS in Iraq Alongside Iranian Troops

The war, therefore, if we judge it by the standards of previous wars, is merely an imposture. It is like the battles between certain ruminant animals whose horns are set at such an angle that they are incapable of hurting one another. But though it is unreal it is not meaningless. It eats up the surplus of consumable goods, and it helps to preserve the special mental atmosphere that a hierarchical society needs. War, it will be seen, is now a purely internal affair. In the past, the ruling groups of all countries, although they might recognize their common interest and therefore limit the destructiveness of war, did fight against one another, and the victor always plundered the vanquished. In our own day they are not fighting against one another at all. The war is waged by each ruling group against its own subjects, and the object of the war is not to make or prevent conquests of territory, but to keep the structure of society intact. The very word ‘war’, therefore, has become misleading. It would probably be accurate to say that by becoming continuous war has ceased to exist. The peculiar pressure that it exerted on human beings between the Neolithic Age and the early twentieth century has disappeared and been replaced by something quite different. The effect would be much the same if the three super-states, instead of fighting one another, should agree to live in perpetual peace, each inviolate within its own boundaries. For in that case each would still be a self-contained universe, freed for ever from the sobering influence of external danger. A peace that was truly permanent would be the same as a permanent war. This — although the vast majority of Party members understand it only in a shallower sense — is the inner meaning of the Party slogan: WAR IS PEACE.

– George Orwell, 1984

While the incompetence and idiocy of U.S. foreign policy remains on clear display across the globe, nowhere is it more embarrassingly evident than within Iraq. Ironically, nowhere is it playing out more tragically within Iraq itself than in the birthplace of deposed dictator Saddam Hussein, Tikrit.

Naturally, there is another explanation for the insanity of it all besides incompetence. That is the 1984 explanation from the quote at the top, which is that endless war represents a deliberate strategy of the oligarchy in order to to crack down on dissent at home and keep enemies divided abroad.

As I outlined in the post, The Forgotten War – Understanding the Incredible Debacle Left Behind by NATO in Libya, there are only two logical conclusions that can be reached about American foreign policy leadership in the 21st century.

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Meet the “Surveillance State Repeal Act” – A Bipartisan Bill to Fully Repeal the Patriot Act

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Revelations about the NSA’s programs reveal the extraordinary extent to which the program has invaded Americans’ privacy. I reject the notion that we must sacrifice liberty for security — we can live in a secure nation which also upholds a strong commitment to civil liberties. This legislation ends the NSA’s dragnet surveillance practices, while putting provisions in place to protect the privacy of American citizens through real and lasting change.

– Rep. Mark Pocan on the Surveillance State Repeal Act

Whenever I hear “bipartisan bill,” the first thing that pops into my mind is that classic George Carlin quote:

The word bipartisan means some larger-than-usual deception is being carried out.

Nevertheless, when I looked at the sponsors and some of the language being used with regard to the Surveillance State Repeal Act, it became pretty clear to me that this bill might actually do what it says. While I’m unfamiliar with Mark Pocan, I’m familiar with Thomas Massie as a result of his close relationship with one of the few members of Congress I respect, Justin Amash.

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Facebook Reveals its Master Plan – Control All News Flow

Screen Shot 2015-03-24 at 1.36.09 PMIn recent months, Facebook has been quietly holding talks with at least half a dozen media companies about hosting their content inside Facebook rather than making users tap a link to go to an external site.

The new proposal by Facebook carries another risk for publishers: the loss of valuable consumer data. When readers click on an article, an array of tracking tools allow the host site to collect valuable information on who they are, how often they visit and what else they have done on the web.

And if Facebook pushes beyond the experimental stage and makes content hosted on the site commonplace, those who do not participate in the program could lose substantial traffic — a factor that has played into the thinking of some publishers. Their articles might load more slowly than their competitors’, and over time readers might avoid those sites.

- From the New York Times article: Facebook May Host News Sites’ Content

Last night, I came across an incredibly important article from the New York Times, which described Facebook’s plan to provide direct access to other websites’ content in exchange for some sort of advertising partnership. The implications of this are so huge that at this point I have far more questions than answers.

Let’s start with a few excerpts from the article:

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Tunisian Terror Attack Suspects Trained in U.S. “Liberated” Libya

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Libya has turned into a complete and total disaster zone/terrorist training camp ever since America and its allies decided to liberate it. While certainly not perfect under Qaddafi, it was an infinitely better place before NATO intervention than after. Not only that, but the entire justification for the “freedom” delivered to it by Western powers was, naturally, based on lies and propaganda. I covered this last month in the post, The Forgotten War – Understanding the Incredible Debacle Left Behind by NATO in Libya. Here’s an excerpt:

In retrospect, Obama’s intervention in Libya was an abject failure, judged even by its own standards. Libya has not only failed to evolve into a democracy; it has devolved into a failed state. Violent deaths and other human rights abuses have increased severalfold. Rather than helping the United States combat terrorism, as Qaddafi did during his last decade in power, Libya now serves as a safe haven for militias affiliated with both al Qaeda and the Islamic State of Iraq and al-Sham (ISIS). The Libya intervention has harmed other U.S. interests as well: undermining nuclear nonproliferation, chilling Russian cooperation at the UN, and fueling Syria’s civil war.


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Video of the Day – John Oliver on Municipal Fines and Private Probation Companies

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When a nation’s economy becomes nothing more than an oligarch crime scene; a gross perversion of the free market best characterized by corruption, theft and in which the sole motivation is to grab as much as possible without regard to ethics, it’s no surprise that entire industries emerge designed to take advantage of the poor and disenfranchised. I’ve covered many examples of this over the years, with the latest example being earlier this month in the post: Profiting from Prisoners – How Jails Partner with Private Firms to Charge for Video Calls While Ending Visitation Rights.

John Oliver has done a fantastic job covering such topics, and his latest segment is both really sad and really important. It covers how private probation companies, specifically Sentinel Offender Services and Judicial Correction Services, parasitically feed off the weak in partnership with local governments. Take a watch:

For related articles, see:

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Just Another Tale from the Oligarch Recovery – $100 Million Homes Being Built on Spec

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Neoclassical economics and the trickle down policy framework that we have derived from it argues that there is a trade-off between fairness and growth. The general idea of trickle down economics is that the richer the rich get and the less constrained they are, less burdened in regulations, the more jobs they create, the better off everyone will be. It’s the concentrated accumulation of capital which is the principal driver of market capitalism.. So, rising economic inequality isn’t a bug, it’s a feature of the trickle down economics. It’s how you know things are getting better, right? Because the richer the rich get, the more jobs they create. This is a general principle of the thing.

– From Salon’s recent interview of Nick Hanauer: The 1 Percent Rigged Everything: Why No One Can End Ronald Reagan’s “Dead Wrong” Voodoo Economics

Just to give you a little sense of how all this wealth has been “trickling down” see…

More developers and investors are racing to build increasingly lavish homes on spec. Built on prime lots with master suites larger than most homes and spas and entertainment spaces comparable with those in hotels, many of these homes are also attempting to break new price records.

Real-estate agents say the surge reflects an ultraluxury housing market that is at an all-time high, fed in part by overseas buyers and house hunters looking to invest in trophy properties. 

“These are people who are going to buy these homes to park money,” says Jeff Hyland, of Beverly Hills-based Hilton & Hyland. 

Mr. Hadid declines to say what he’s spending on the home, but says the listing price will likely be in the $200 million range when the house is completed next year.

– From the Wall Street Journal article: The Race to the $100 Million Spec House

Before I get into the meat of this post, I want to highlight a recent insightful interview Nick Hanauer gave to Salon. In case you forgot, Mr. Hanauer is the billionaire who came out and publicly warned of pitchforks unless our corrupt economic system is reformed. I highlighted his article and provided my own thoughts in the piece: The Pitchforks are Coming…– A Dire Warning from a Member of the 0.01%. If you never read that, I suggest taking a look now.

A very poignant point made by Hanauer in his latest interview, concerns how fake liberals like Barack Obama will pay lip service to income inequality as if it is simply some unexpected moral tragedy which happened accidentally within a well functioning economic system. Hanauer correctly points out that the economic system itself is corrupted. That all wealth is being funneled to a tiny oligarchy isn’t a a flaw within this system, it’s a deliberate part of the design itself replete with its own elitist hedging mechanism.

For example, whenever oligarch wealth is threatened, such as in the 2008/09 time period, all resources are immediately mobilized to bail them out. The interests of all other segments of society are consistently thrown to the wayside, with the exception of welfare merely meant to just lessen the probability of civil unrest, as opposed to actually lifting people into the middle or upper classes.

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