Blog Archives

The Conflict within the Deep State Just Broke into Open Warfare

When do the unlimited powers of the Intelligence/Security agencies threaten America’s domestic and global national interests? The CIA and its political enablers claim the agency’s essentially unlimited powers, partially revealed by Wikileak’s Vault 7, pose no threat to America’s interests, since they are intended to “defend” American interests.

This is the rationale presented by neocon CIA allies in both political parties: the CIA can’t possibly threaten America’s interests because the CIA defines America’s interests.

This is the wormhole down which civil liberties and democracy have drained. It is an extraordinarily defining moment in American history when the director of the FBI publicly declares that there is no such thing as “absolute privacy” in the U.S.

In effect, privacy is now contingent on the level of interest the Security State has in the private conversation/data. If we read the U.S. Constitution, we do not find such contingencies: civil liberties are absolute. Post-1790 presidents have temporarily mooted civil liberties in time of war, and the CIA-led camp of the Deep State has justified its unlimited powers by effectively declared “a state of war is now permanent and enduring.”

So what’s left to defend if America has become the enemy of civil liberties and democracy, i.e. become a totalitarian state ruled by Security Services and their political henchmen and apologists?

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Does a Rogue Deep State Have Trump’s Back?

Suddenly everybody is referring to the Deep State, typically without offering much of a definition.

The general definition is the unelected government that continues making and implementing policy regardless of who is in elected office.

I have been writing about this structure for 10 years and studying it from the outside for 40 years. Back in 2007, I called it the Elite Maintaining and Extending Global Dominance, which is a more concise description of the structure than Deep State. Going to War with the Political Elite You Have (May 14, 2007).

I’ve used this simplified chart to explain the basic structure of the Deep State, which is the complex network of state-funded and/or controlled institutions, agencies, foundations, university research projects, media ties, etc.

The key point here is you can’t separate these network nodes:

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Trump Aims to Cut the Neocon Deep State Off at the Knees

I have long held that America’s Deep State–the unelected National Security State often referred to as the Shadow Government–is not a unified monolith but a deeply divided ecosystem in which the dominant Neocon-Neoliberal Oligarchy is being challenged by elements which view the Neocon-Neoliberal agenda as a threat to national security and the interests of the United States.

I call these anti-Neocon-Neoliberal elements the progressive Deep State.

If you want a working definition of the Neocon-Neoliberal Deep State, Hillary Clinton’s quip–we came, we saw, he died–is a good summary: a bullying, arrogance-soaked state-within-a-state pursuing an agenda of ceaseless intervention while operating a global Murder, Inc., supremely confident that no one in the elected government can touch them.

Until Trump unexpectedly wrenched the presidency from the Neocon’s candidate. The Neocon Deep State’s response was to manufacture a mass-media hysteria that Russia had wrongfully deprived the Neocon’s candidate (Hillary Clinton) of what was rightfully hers: the presidency. (The Neocons operate their own version of the divine right of Political Nobility.)

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The Age of Disintegration: Political Disunity and Elites At War

Historian Michael Grant identified profound political disunity in the ruling elite as a key cause of the dissolution of the Roman Empire. Grant described this dynamic in his excellent account The Fall of the Roman Empire.

The chapter titles of the book illuminate the complex causes of profound political disunity in the ruling elite:

The Gulfs Between the Classes: a.k.a. soaring income/wealth inequality: check.

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These Blast Points on Hillary’s Campaign… Only The Deep State Is So Precise

Back in August, I asked Could the Deep State Be Sabotaging Hillary? I think we now have a definitive answer: “These blast points on Hillary’s campaign… too accurate for the Mainstream Media. Only the forces of the Imperial Deep State are so precise.”

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USA 2017-2020: An Ungovernable Nation?

Regardless of who wins the presidency, a much larger question looms: will the U.S. be ungovernable 2017-2020? There are multiple sources of the question.

One is of course the remarkable unpopularity of the two candidates for the presidency. For all the reasons that are tiresomely familiar, whomever wins the presidency will remain deeply unpopular with roughly 40% of the adult populace.

Though we can’t say “never,” let’s say it’s “extremely unlikely” that fans of Hillary Clinton will cotton to Donald Trump, or vice versa: both candidates have been public figures for decades, and it is highly unlikely that the usual “I will serve all the people” speech given by the new president will change many minds.

It’s not too difficult to foresee not just gridlock, but angry gridlock. Neither candidate can count on even the slightest shreds of goodwill from the other party, and with bi-partisanship already dead on arrival, precisely how much governance can any deeply reviled president offer the nation?

Whether pundits like it or not, one issue that will not go away after the election is the dominance of the nation’s financial and political elite: the top .01%.

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Why the Deep State Is Dumping Hillary

Are you open to a somewhat unconventional perspective on this election? If so, read on. If you’re absolutely confident you know all there is know about this election (good vs evil, Democrat vs. Republican, etc.), well then let’s compare notes in five years and see which context provided more insight into the future.

In the context presented here, the personalities of the two candidates matter less than their perceived role in the changing of the Imperial Order. Let’s start with a quick overview of the relationships between each political party and the Deep State–the unelected power centers of the central government that continue on regardless of which person or party is in elected office.

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The Deep State’s Catch-22

Catch-22 (from the 1961 novel set in World War II Catch-22) has several shades of meaning (bureaucratic absurdity, for example), but at heart it is a self-referential paradox: you must be insane to be excused from flying your mission, but requesting to be excused by reason of insanity proves you’re sane.

The Deep State in virtually every major nation-state is facing a form of Catch-22: the Deep State needs the nation-state to feed on and support its power, and the nation-state requires stability above all else to survive the vagaries of history.

The only possible output of extreme wealth inequality is social and economic instability.

The financial elites of the Deep State (and of the nation-state that the Deep State rules) generate wealth inequality and thus instability by their very existence, i.e. the very concentration of wealth and power that defines the elite.

So the only way to insure stability is to dissipate the concentrated wealth and power of the financial Deep State. This is the Deep State’s Catch-22.

What happens when extremes of wealth/power inequality have been reached? Depressions, revolutions, wars and the dissolution of empires. Extremes of wealth/power inequality generate political, social and economic instability which then destabilize the regime.

Ironically, elites try to solve this dilemma by becoming more autocratic and repressing whatever factions they see as the source of instability.

The irony is they themselves are the source of instability.

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Could the Deep State Be Sabotaging Hillary?

Few would dispute that Hillary Clinton is the Establishment’s candidate. It’s widely accepted that the Establishment hews to a neoconservative (neo-con) foreign policy that is fully supported by America’s Deep State, i.e. the centers of state power that don’t change as a result of elections.

As a result, it’s widely accepted that the Deep State fully supports Hillary Clinton’s bid for the presidency and will move heaven and earth to get her elected. While this is a logical premise, I suspect it’s overly simplistic. I suspect major power centers in the Deep State are actively sabotaging Hillary because they’ve concluded she is a poisoned chalice who would severely damage the interests of the Deep State and the U.S.A.

Poisoned chalice: something that seems very good when it is first received, but in fact does great harm to the person/ institution/ nation that receives it.

I realize this may strike many as ludicrous, but bear with me as we work through the notion that the Deep State would prefer Trump to Hillary.

The consensus view seems to be that the Establishment and the Deep State see Trump as a loose cannon who might upset the neo-con apple cart by refusing to toe the Establishment’s Imperial line.

This view overlooks the possibility that significant segments of the Deep State view the neo-con strategy as an irredeemable failure and would welcome a president who would overthrow the remnants of the failed strategy within the Establishment and Deep State.

To these elements of the Deep State, Hillary is a threat precisely because she embraces the failed strategy and those who cling to it. From this point of view, Hillary as president would be an unmitigated disaster for the elements of the Deep State that have concluded the U.S. must move beyond the neo-con strategic failures to secure the nation’s core interests.

There are other reasons why elements of the Deep State view Hillary as a poisoned chalice.

1. Hillary is an empty vessel. Nobody seriously claims she has any core beliefs that she would make personal sacrifices to support. While at first glance this may seem to be a plus, the Deep State is not devoid of values. Rather, the typical member of the Deep State has strong values and distrusts/ loathes people like Hillary who value nothing other than personal aggrandizement.

Hillary’s sole supreme commitment is the further aggrandizement of wealth and power to her family. This makes her intrinsically untrustworthy to the Deep State, which has bigger fish to fry than the Clinton Project of aggrandizing wealth and personal power.

2. Hillary has exhibited the typical flaw of liberal Democrats: fearful of being accused as being soft on Russia, Syria, Iran, terrorism, etc. or losing whatever war is currently being prosecuted, liberal Democrats over-compensate by pursuing overly aggressive and poorly planned policies.

The forward-thinking elements of the Deep State are not averse to aggressive pursuit of what they perceive as American interests, but they are averse to quagmires and policies that preclude successful maintenance of the Imperial Project.

3. The Deep State requires relatively little of elected officials, even the President. A rubber stamp of existing policies is the primary requirement (see the Obama presidency for an example).

But the Deep State prefers a leader that can successfully sell the Deep State’s agenda to the American public. (President Obama has done a very credible job of supporting the Imperial Project agenda. I think it’s clear the Deep State supported President Obama’s re-election.) A politician who’s primary characteristic is untrustworthiness is poorly equipped to sell anything, especially something as complex and increasingly unpopular as the Imperial Project.

4. Hillary suffers from the delusion that she understands power politics and the Imperial Project. The most dangerous President to the Deep State is one who believes he/she is qualified to set the Imperial agenda and change the course of the Deep State as their personal entitlement.

For these reasons, elements of the Deep State might sabotage Hillary’s campaign as the greater threat to American interests. Trump is as unpopular as Hillary, but his sense of self-aggrandizement and narcissism is of a different order than Hillary’s. Elements of the Deep State may view Trump as more malleable (or more charitably, as more open to much-needed changes in U.S. policies) and a better salesperson than Hillary.

Although it’s difficult to identify specific evidence for this, the Deep State is not as monolithic as the alternative media assumes. An increasingly powerful sector of the Deep State views the neo-con agenda as a disaster for American interests, and is far more focused on the Long Game of energy, food security, economic and military innovation and a productive response to climate change.

Trump is less wedded to the neo-con agenda than Hillary, less concerned with looking weak and more willing to cut new deals to clear the path for U.S. soft power (diplomacy, cultural influence, energy, food security, economic innovation and successful responses to climate change) rather than the neo-con obsession with hard power and the old-style Great Game of geopolitics.

So how could the forward-looking elements of the Deep State sabotage Hillary?I can think of several ways:

1. Engineer a protracted stock market decline that hits American voters in their pocketbooks before the election by gutting the “wealth effect.” A plunging stock market would make a mockery of the claim that the economy is “recovering.”

2. Continue to leak dirty laundry on Hillary, her health, the Clinton foundation scams, etc.

3. Put the word out to the corporatocracy, top-level media, etc., that the Deep State would prefer a Trump presidency, despite the widely held assumption that Clinton is the shoo-in Establishment candidate, and that those who cling to Hillary will pay a price later on as the neo-cons are cashiered or sent to Siberia for their failures.

Maybe Hillary is the Deep State’s shoo-in for president. But I suspect doubts in the Deep State have advanced to active sabotage for the reasons noted above.

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If Hillary Isn’t Indicted, the Rule of Law and the Republic Are Dead

To paraphrase Ernest Hemingway: How did you lose your Republic? Two ways, gradually and then suddenly. The Romans experienced this when their Republic was extinguished by Empire.

The erosion of the Republic was gradual: slowly but surely, the lower classes’ representation in governance was curtailed; the Oligarchy of the wealthy and powerful cemented their privileges at the expense of the many; Oligarchs rose above the laws that were supposed to apply to all, and executive power was consolidated in top administrators and the wealthy at the expense of the Senate.

When Caesar crossed the Rubicon with his army to seize control of Rome, the Roman Republic ceased to exist. Gradually and then suddenly: this is how Republics become Empires.

We find ourselves in a parallel moment in history: the American Republic has been hollowed into a shell that is maintained for PR purposes. Beneath the propaganda, the Establishment runs the nation for its own benefit. The people are ignored, because they are powerless in this hollow shell of democracy: their only role is to provide bodies, talent and blood for the Imperial armed forces, pay taxes if they have any money, and be content with their food stamps if they don’t.

Here’s the proof:

Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens

Multivariate analysis indicates that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence.

Here are two articles in the same vein:

America the Banana Republic

The Quiet Coup

The United States has reached a crossing the Rubicon moment: either Hillary Clinton is indicted for knowingly violating statutes regarding State Department security, or the rule of law and the Republic are dead. This is a binary moment: we either let Hillary evade the laws that were established to protect the security of the nation and confess there is no rule of law now for the Oligarchy, or the agencies tasked with defending the nation indict her.

There is no middle ground. If Hillary isn’t indicted, the rule of law, i.e. no one is above the law, is dead.

If you believe Hillary that she didn’t really do anything to violate the spirit or the letter of security laws, please review these statutes:

U.S. Department of State Foreign Affairs Manual Volume 12 – Diplomatic Security
12 FAM 531.1 Top Secret Storage
12 FAM 531.1-1 Domestic
(CT:DS-185; 01-31-2012)
(Uniform State, USAID, OPIC, TDP)

2 FAM 558 CRIMINAL LAWS
(TL:DS-70; 10-01-2000)

Incidents involving intentional or grossly negligent release or mishandling of classified information may be subject to criminal penalties. An illustrative list of criminal statutes establishing penalties of fine and imprisonment for the release of classified information is set forth in 12 FAM 558 Exhibit 558.

Once the Oligarchy is above the law, the Republic is already dead. Once the people have lost the ability to influence the central state’s policies and decisions, the Republic is dead. Once the elected officials can no longer impose the nation’s statues on the Oligarchy (or have lost interest in doing so because they are all corrupted cronies), the Republic is dead. Once the nation’s agencies of law enforcement are stayed from indicting, prosecuting and jailing members of the Oligarchy, be they super-wealthy politicos like Hillary or super-wealthy Wall Street bankers, the Republic is dead.

The Democratic Party bosses and special interests have already selected Hillary as their shoo-in candidate for the Presidency, and these Oligarchs and special interests won’t let any pesky details like laws protecting the security of the nation stand in the way of their Not So Quiet Coup.

The nation’s Deep State, which I have covered extensively, has at least grudgingly approved Hillary as the next neo-conservative (never met an Imperial entanglement or drone strike she didn’t like), neocolonial (we’re going to put the “little people” in their rightful place, i.e. under our management) Imperial President.

A vote for Hillary, unindicted Oligarch, is a vote in favor of the destruction of the rule of law and the Republic. This is the Rubicon every voter must decide to cross or refuse to cross: vote for Hillary (destroy the Republic and surrender to Imperial Oligarchy) or refuse to vote for an unindicted Imperial Oligarch.

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Cheap Oil, the U.S. Dollar and the Deep State

That oil fell off a cliff once the U.S. dollar (USD) began its liftoff in mid-2014 is, well, interesting. Causation, correlation or coincidence? There are a variety of opinions on this, as there should be. What we do know is the soaring USD blew up a bunch of carry trades that borrowed money denominated in USD and invested the cash in emerging markets paying much higher yields. Here’s WTIC oil:

And here’s the USD Index:

We also know the Saudis announced that the kingdom would pump every barrel it could “to maintain market share,” which is generally understood to mean crush competitors such as Russia and U.S. shale producers.

We also know that storage facilities are almost full up (Oil Fundamentals Could Cause Oil Prices To Fall, Fast!).

We also know that global growth is slowing, so demand could weaken sharply going forward.

And lastly, we know that many oil exporters are heavily dependent on oil revenues to fund their oligarchy/monarchy/ruling elites, their military and their vast social welfare programs, which keep the restive masses from overthrowing the oligarchy, etc.

Here is the U.S., heavily indebted producers must pump or die, as they need every dime of revenue to service their vast debts.

If we add all this up– carry trades blowing up, weakening demand and heavy pressures to maintain production–we get a perfect set-up for a continued decline in oil.

Many observers are expecting the Federal Reserve to pull out all the stops to weaken the dollar. They think this because a strong dollar hurts U.S. exports. If oil and the USD are indeed correlated, a weaker dollar would trigger a boost in oil prices–a welcome “saved by the bell” for indebted U.S. producers, and the bankers who lent tens of billions of dollars to them.

If you glance at the above chart of the dollar index, you’ll note the Bollinger Bands are tightening. This usually presages a big move up or down. We don’t know which way the USD will move, but since it’s in a Bull market, we might surmise the move will be a continuation of the current trend, i.e. up.

Technically, a 20% gain to the 120 level would be quite typical of a long-term uptrend.

What would an additional 20% gain in the USD do to oil? If the correlation holds (and perhaps it won’t–there are no guarantees), it would very likely crush oil to new and breathtaking lows. Analyst Art Berman recently suggested a target of $16.50/barrel, and this corresponds rather neatly with USD at 120 (a 20% gain).

Lower oil prices are not an unalloyed “win” for the U.S. The U.S. energy sector is getting pummeled, and soon its lenders will start booking staggering losses. The decline in petrodollars also means there is less demand for U.S. Treasuries from oil exporters.

Enter the U.S. Deep State, which is only marginally interested in Wall Street bankers’ losses or petrodollar recycling into Treasuries. Global hegemony ultimately rests on issuing the reserve currency in size, and the sheer magnitude of financial resources that can be brought to bear to do what is viewed as necessary.

The collapse in oil has led to an unprecedented transfer of wealth from producers to consumers. Oil exporters (the number of which is diminishing, as populations and domestic consumption levels soar throughout the oil-producing world) have far fewer USD to spend on military adventures, social welfare, the tallest buildings in the world, and so on.

If global bankers wise up (and they are smart gals/guys), lending to oil producers is about to dry up like the proverbial mist in Death Valley. Why loan money to someone with $35/barrel oil in the ground if oil is heading to $20 or lower?

Who goes broke/goes home/is overthrown at sustained $20/barrel oil? You can make your own list, but it pretty much includes every oil exporter.

So who wins in a scenario in which the USD gains another 20% and pins oil to new, sustained lows? Consumers, of course, but as Zero Hedge and others have explained, this windfall isn’t leading to robust consumer spending. Rather, households are saving the proceeds, hunkering down in the recessionary winds they see rising.

The U.S. oil sector will take some serious lumps, along with every other producer. We can anticipate huge writedowns of uncollectible debt, bankruptcies, and all the other collateral damage (pun intended) of a bust.

But who is left relatively unscathed in terms of financial power and hegemony? The U.S. Should the USD soar another 20%, China would be forced to devalue its currency, causing massive capital flows out of China and an immediate loss of trillions of dollars of purchasing power for all who hold yuan/RMB. Not much of a win there.

All this is to suggest that those expecting a major weakening in the USD to push oil higher shouldn’t hold their breath awaiting this outcome. Maybe the USD will weaken 20%, but why would it do so when every other central bank is weakening its currency? Wouldn’t it make much more sense to drain wealth and geopolitical leverage from oil exporters?

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Untangling America from the American Empire

The Status Quo would have us believe that America and its Empire are one entity. This is handy for those with Imperial designs but it is false: America could be untangled from its Empire, and many of us believe it is essential that America untangles itself from its Imperial structures and ideologies.

What I call The Imperial Project was cobbled together in the aftermath of World War II, when the Soviet Union and America posed an existential threat to each other’s ideologies and systems. It may be hard to believe, but the U.S. did not have a Central Intelligence Agency (CIA) or other espionage/intelligence gathering agency prior to World War II.

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