Dollar Hysteria

Commentary on Robert Fisk's recent warmongering:

Is the Sky Really Falling?
06.10.2009
By Mike Whitney

October 06, 2009 "Information Clearing House" — - Robert Fisk lit the fuse with his hyperventilating narrative which appeared in Tuesday's UK Independent titled, "The Demise of the Dollar". The article went viral overnight spreading to every musty corner of the Internet and sending gold skyrocketing to $1,026 per oz. Now every doomsday website in cyber-world has headlined Fisk's "shocker" and the blogs are clogged with the frenzied commentary of bunker-dwelling survivalists and goldbugs who're certain that the world as we know it is about to end.

From Fisk's article:

"In the most profound financial change in recent Middle East history, Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.

The Americans, who are aware the meetings have taken place – although they have not discovered the details – are sure to fight this international cabal which will include hitherto loyal allies Japan and the Gulf Arabs. Against the background to these currency meetings, Sun Bigan, China's former special envoy to the Middle East, has warned there is a risk of deepening divisions between China and the US over influence and oil in the Middle East. "Bilateral quarrels and clashes are unavoidable," he told the Asia and Africa Review. "We cannot lower vigilance against hostility in the Middle East over energy interests and security." (UK Telegraph)

"International cabal"? C'mon, Bob, you're better than that.

Reports of the dollar's demise are greatly exaggerated. The dollar may fall, but it won't crash. And, in the short-term, it's bound to strengthen as the equities market reenters the earth's gravitational field after a 6 month-long ride through outer-space. The relationship between falling stocks and a stronger buck is well established and, when the market corrects, the dollar will bounce back once again. Bet on it. So why all this bilge about Middle Eastern men huddled in "secret meetings" stroking their beards while plotting against the empire?

Isn't that the gist of Fisk's article?

Yes, the dollar will fall, (eventually) but not for the reasons that most people think. It's true that the surge in deficit spending has foreign dollar-holders worried. But they're more concerned about the Fed's quantitative easing (QE) program which adds to the money supply by purchasing mortgage-backed securities and US Treasuries. Bernanke is simply printing money and pouring it into the financial system to keep rigamortis from setting in. Naturally, the Fed has had to quantify exactly how much money it intends to "create from thin air" to placate its creditors. And, it has. (The program is scheduled to end by the beginning of 2010) That said, China and Japan are still buying US Treasuries, which indicates they have not yet "jumped ship".

The real reason the dollar will lose its favored role as the world's reserve currency is because US markets, which until recently provided up to 25 percent of global demand, are in sharp decline. Export-dependent nations--like Japan, China, Germany, South Korea--already see the handwriting on the wall. The US consumer is buried under a mountain of debt, which means that his spending-spree won't resume anytime soon. On top of that, unemployment is soaring, personal wealth is falling, savings are rising, and Washington's anti-labor bias assures that wages will continue to stagnate for the foreseeable future. Thus, the American middle class will no longer be the driving force behind global consumption/demand that it was before the crisis. Once consumers are less able to buy new Toyota Prius's or load up on the latest China-made widgets at Walmart, there will be less incentive for foreign governments and central banks to stockpile greenbacks or trade exclusively in dollars.

Here's a clip from the Globe and Mail cited on Washington's Blog:

"A UBS Investment Research report says that while it would be wrong to write off the U.S. dollar as the global reserve currency, its roughly 90-year iron grip on that position is loosening. “The use of the U.S. dollar as an international reserve currency is in decline,” said UBS economist Paul Donovan.

“The market share of the dollar in international transactions is likely to decline over the coming months and years, but only persistent policy error – or considerable fiscal strain – is likely to cause the dollar to lose reserve currency status entirely.”

The UBS report maintains that the gradual slide of the U.S. dollar is being driven not by the world’s central banks, but by the private sector, as individual companies increasingly abandon the greenback as their international currency of choice.

“The private sector’s use of reserves is more important than official, central bank reserves – anything up to 20 times the significance, depending on interpretation,” Mr. Donovan said. “There is evidence that the move away from the dollar as a private-sector reserve currency has been accelerating since 2000.”

As private industry veers away from the dollar, governments, investors and central banks will follow. The soft tyranny of dollar dominance will erode and parity between currencies and governments will grow. This will create better opportunities for consensus on issues of mutual interest. One nation will no longer be able to dictate international policy.

So-called "dollar hegemony" has added greatly to the gross imbalance of power in the world today. It has put global decision-making in the hands of a handful of Washington warlords whose narrow vision never extends beyond the material interests of themselves and their constituents. As the dollar weakens and consumer demand declines, the United States will be forced to curtail its wars and adjust its behavior to conform to international standards. Either that, or be banished into the political wilderness.

So, what exactly is the downside?

Superpower status rests on the flimsy foundation of the dollar, and the dollar is beginning to crack. Fisk is right; big changes are on the way. Only not just yet.

Source

Israeli tanks enter eastern Gaza

Press TV - October 6, 2009 15:28:44 GMT

Fighting has broken out between Israeli forces and Palestinian fighters in eastern Gaza Strip after Israeli tanks and armored bulldozers crossed the border into the coastal region.

Military tanks fired shells at residential areas in the region, leaving a Palestinian wounded, a press TV correspondent reported Tuesday.

The incursion set off the fighting.

Saudi Bank Governor Denies Talks to Replace Dollar

By Camilla Hall

Oct. 6 (Bloomberg) -- Saudi Arabia hasn’t held talks with China and other countries on dropping the dollar as the currency for pricing oil, Saudi Central Bank Governor Muhammad al-Jasser said, denying a report in the U.K.’s Independent newspaper.

The Independent report is “absolutely incorrect” and there has been “absolutely nothing” of that nature discussed between Saudi Arabia, the world’s biggest oil exporter, and other countries, al-Jasser told reporters in Istanbul, where he’s attending an International Monetary Fund summit. The dollar pared losses after his remarks.

The London-based newspaper said today that Gulf oil producers and nations including China, Japan, Russia and Brazil had held secret talks on a nine-year plan to phase out the dollar in oil trade, and move toward pricing the fuel in a basket of currencies plus gold. It cited unidentified Gulf officials and unidentified Chinese bankers.

“I don’t give credence to this story,” said Simon Williams, a Dubai-based economist at HSBC Holdings Plc. “Short- term, it’s highly unlikely that oil will not continue to be priced in dollars.”

The dollar pared losses against the euro following al- Jasser’s comments, trading at $1.4725 as of 9:40 a.m. in London, from $1.4648 in New York yesterday. It weakened to $1.4749 earlier on the Independent story. It was at 89.10 yen, from 89.53 yesterday, after falling to 88.86.

Dollar Dependence

Criticism of the dollar’s role as the world’s main reserve currency has grown in the wake of the global financial crisis. China and Russia in June agreed to expand use of each other’s currencies in trade to reduce dependence on the dollar, and those countries plus Brazil and India -- the so-called BRIC nations -- have discussed buying each other’s bonds and swapping currencies. The dollar fell to a one-year low of $1.4844 per euro on Sept. 23.

Saudi Arabia, a key U.S. ally, pegs its currency to the U.S. dollar like most other oil-rich Gulf nations, and has resisted calls for a move away from the dollar in oil pricing as the U.S. currency lost value in recent years.

Iran and Venezuela raised the proposal at a meeting of the Organization of Petroleum Exporting Countries, which pumps about 40 percent of the world’s oil, in November 2007. The weaker dollar adds to costs for OPEC members who use oil revenue to buy goods priced in other currencies.

New Gulf Currency

Saudi Arabia and three other Gulf oil-producers are planning to create a shared currency that may allow them more freedom from U.S. monetary policy. As the region’s economies rebound faster than the U.S. from the global crisis, “the shortcomings of the dollar peg will become increasingly clear,” HSBC’s Williams said.

Other countries cited by the Independent as being involved in the secret plan also denied it.

Japanese Finance Minister Hirohisa Fujii said at a news conference in Tokyo today that he “doesn’t know anything about it,” when he was asked about the newspaper report.

Russia’s Finance Ministry isn’t holding talks on replacing the dollar for oil sales, Interfax news agency reported, citing Deputy Finance Minister Dmitry Pankin. Kuwaiti Oil Minister Sheikh Ahmed Al-Abdullah Al-Sabah told reporters today in Kuwait City that Gulf Arab states have no plans to drop the dollar for oil pricing.

To contact the reporter on this story: Camilla Hall in Dubai at chall24@bloomberg.net

Heavy security around al-Aqsa

Al Jazeera
October 5, 2009

Israel has deployed large numbers of police officers around the Old City of Jerusalem after sporadic clashes with Palestinian worshippers around the al-Aqsa mosque compound.

Muslim men under the age of 50 were prevented from entering the compound as thousands of Jews gathered at the nearby Western Wall on Monday for prayers marking the week-long holiday of Sukkot.

The area, known as the Haram al-Sharif to Muslims and the Temple Mount to Jews, is the third holiest location in Islam and Judaism's most important site.

Some scuffles were reported to have broken out between Israeli police and Palestinian worshippers at the Damascus Gate after people were refused access.

Worshippers restricted

"There were Palestinian worshippers who turned up for morning prayers. They were told by the police force that anyone under the age of 50 would not be allowed through," Al Jazeera's Sherine Tadros, reporting from Jerusalem, said.

"There are [at present] about 7,000 Jewish worshippers attending a prayer, a blessing at the Wailing [Western] Wall, which is just at the foot of the Haram al-Sharif.

"This is one of the three times during the year in which Jewish worshippers are told to go to Jerusalem and pray."

Justifying the restrictions on entry to the mosque, Micky Rosenfeld, an Israeli police spokesman, said: "These measures were taken to avert new incidents on the compound and the Old City and to prevent stones being thrown at the Jewish faithful who come to pray at the Western Wall."

He said "hostile elements are inciting to violence", pointing the finger at the Islamic Movement, an Arab-Israeli group that regularly calls the faithful to rally to the defence of al-Aqsa.

For its part, the Palestinian Authority urged the international community to "immediately intervene and bring the question of the al-Aqsa mosque before the UN Security Council".

Jordan, meanwhile, summoned Israel's ambassador in Amman to demand a halt to "repeated violations" by Israel at the al-Aqsa compound.

Sunday's clashes

Skirmishes broke out near the Lion's Gate entrance to the Old City on Sunday after Israeli security forces closed off Haram al-Sharif to prevent Palestinians from joining about 200 worshippers who had staged a sit-in at the site.

The Palestinians had gathered at the mosque on Saturday night, saying they intended to prevent Jewish hardliners from gaining access.

The Palestinian group Hamas, which effectively governs the Gaza Strip, has warned that an "aggressive assault" by Jewish worshippers on the compound risks sparking a new wave of unrest in Israel and the Palestinian territories.

"... we will not sit on our hands as we will rise in defence of our sanctities. Prejudice to al-Aqsa Mosque is not only a red line, but it is a ticking time bomb that will explode in the face of the Zionist aggressors," Hamas said in a statement.

'Flock to al-Aqsa'

Hamas also urged Palestinians to "flock to al-Aqsa" to offer their prayers in defiance of the Israeli blockade.

"We call on the brave fellow Palestinians and all the Arab and Muslim peoples to rise in defence of our sanctities, to spark another Intifada [uprising] to defend Jerusalem and al-Aqsa mosque," the group's statement said.

At least 13 Palestinians were injured and seven detained in clashes the previous Sunday after a group of non-Muslims entered the mosque compound.

Israeli police said the group was made up of French tourists, while the Palestinians said they were Israeli extremists.

Israel captured and annexed the Old City with its holy sites, along with the rest of Arab East Jerusalem and the West Bank, in the war of 1967.

“Save Darfur”: Fast the Eid!

by Alex de Waal - September 14, 2009

America’s Darfur campaign sometimes goes beyond parody. The last few weeks have shown this to the full, beginning with the fantastical “Sudan Now” campaign and culminating in the proposal to fast the Eid. It beggars belief.

Having spent most of the last few months in Sudan, especially Darfur, it is increasingly evident that “Save Darfur”—here meaning not just the Save Darfur Coalition but the wider movement—is out of touch with realities. What they describe and prescribe has little or no relation to what is happening and what should be done. Three recent “Save Darfur” activities highlight this.

First is their campaign to push Obama to “keep the promise” and the ridiculous advertisements in newspapers and the Obamas’ vacation destination. They might do well to recall John Maynard Keynes’s well-known riposte to someone who accused him of inconsistency: “When the facts change, I change my mind? What do you do sir?” The facts have changed, the campaign hasn’t. A few months ago I asked rhetorically, “Can Sudan activism transform itself for the Obama era?” So far, the record is dispiriting.

There’s an episode in Joseph Heller’s Catch 22 where the principal character, Yossarian, is tending to a badly wounded young airman, Snowden. He goes about stemming a leg wound in the airman’s leg, while the boy mutely nods, until Yossarian realizes that he is meaning that there’s another wound too—a piece of shrapnel has got inside Snowden’s flak jacket and torn open his side. Yossarian has been busy bandaging the wrong wound while the poor boy is dying. It’s the defining trauma of the book. And it’s the defining error of the “keep the promise” campaign—money misspent on a campaign that is only hampering General Scott Gration the task he has correctly identified, which is finding a workable political settlement for Sudan as a whole. The efforts by “Save Darfur” to try to link its clamour on Darfur with the national issue stretches credibility.

Next was a revealing quote from John Prendergast in response to the remark by Gen. Martin Agwai, outgoing UNAMID Force Commander, that the war in Darfur was essentially over. He could not dispute Gen. Agwai’s facts nor his integrity. Prendergast’s criticism was that this was “something that takes the wind out of the sails of international action.”

This was perhaps more illuminating than Prendergast intended: his campaign is not about domestic solutions but international (read: U.S.) action. That’s Save Darfur’s second big error: if there is to be a solution, it will come from inside Sudan, and must be political, addressed at the structural political challenges of Sudan. A campaign focused on a genocide that isn’t happening, for the U.S. to step up its pressure to stop killing that has already ended, is just making Save Darfur look poorly-informed, and America look silly. Intermittently, “Save Darfur” has tried to rebrand itself as a peace movement—but its origins as an intervention campaign make it virtually impossible to make the transformation. Peace cannot be forced or dictated. If “Save Darfur” is interested in peace, the best it can do in the cause of peace is to fall silent.

Third–and simply stunning–is the choice of date for a fast for Darfur: 21 September. Muslims have been fasting since the beginning of Ramadhan and Eid will fall on 20 and 21 September. As soon as I mentioned the date to my wife, who is a Muslim, she laughed out loud. Not just her: every Muslim, Sudanese or otherwise, I have mentioned this to (trying my best to keep a straight face) has guffawed in amazement. Just as Darfurians are breaking their fast, Save Darfur’s campaigners will be starting theirs. The choice of day is astonishingly ignorant of, and insensitive to the Muslim world. “Save Darfur” may be a multi-faith initiative, but Muslims hardly count. “Save Darfur” isn’t about Sudan, or indeed Darfur, at all–it’s about an imagined empathy and generating a domestic American political agenda. Shame on you, Prendergast and your fellow “activists”, shame, shame, shame.

Source

Ahmadinejad has no Jewish roots

Rumours that Mahmoud Ahmadinejad's family converted to Islam from Judaism are false. In fact, they are proud Shias

Meir Javedanfar
guardian.co.uk, Monday 5 October 2009 11.14 BST

In June 2005, Mahmoud Ahmadinejad's meteoric rise from mayor of Tehran to president of one of the most influential countries in the Middle East took everyone by surprise. One of the main reasons for the astonishment was that so little was known about him.

One recently published claim about his background comes from an article in the Daily Telegraph. Entitled "Mahmoud Ahmadinejad revealed to have Jewish past", it claims that his family converted to Islam after his birth. The claim is based on a number of arguments, a key one being that his previous surname was Sabourjian which "derives from weaver of the sabour, the name for the Jewish tallit shawl in Persia".

Professor David Yeroshalmi, author of The Jews of Iran in the 19th century and an expert on Iranian Jewish communities, disputes the validity of this argument. "There is no such meaning for the word 'sabour' in any of the Persian Jewish dialects, nor does it mean Jewish prayer shawl in Persian. Also, the name Sabourjian is not a well-known Jewish name," he stated in a recent interview. In fact, Iranian Jews use the Hebrew word "tzitzit" to describe the Jewish prayer shawl. Yeroshalmi, a scholar at Tel Aviv University's Center for Iranian Studies, also went on to dispute the article's findings that the "-jian" ending to the name specifically showed the family had been practising Jews. "This ending is in no way sufficient to judge whether someone has a Jewish background. Many Muslim surnames have the same ending," he stated.

Upon closer inspection, a completely different interpretation of "Sabourjian" emerges. According to Robert Tait, a Guardian correspondent who travelled to Ahmadinejad's native village in 2005, the name "derives from thread painter – sabor in Farsi – a once common and humble occupation in the carpet industry in Semnan province, where Aradan is situated". This is confirmed by Kasra Naji, who also wrote a biography of Ahmadinejad and met his family in his native village. Carpet weaving or colouring carpet threads are not professions associated with Jews in Iran.

According to both Naji and Tait, Ahmadinejad's father Ahmad was in fact a religious Shia, who taught the Quran before and after Ahmadinejad's birth and their move to Tehran. So religious was Ahmad Sabourjian that he bought a house near a Hosseinieh, a religious club that he frequented during the holy month of Moharram to mourn the martyrdom of Imam Hossein.

Moreover, Mahmoud Ahmadinejad's mother is a Seyyede. This is a title given to women whose family are believed to be direct bloodline descendants of Prophet Muhammad. Male members are given the title of Seyyed, and include prominent figures such as Iran's supreme leader Ali Khamenei. In Judaism, this is equivalent to the Cohens, who are direct descendants of Aaron, the brother of Moses. One has to be born into a Seyyed family: the title is never given to Muslims by birth, let alone converts. This makes it impossible for Ahmadinejad's mother to have been a Jew. In fact, she was so proud of her lineage that everyone in her native village of Aradan referred to her by her Islamic title, Seyyede.

The reason that Ahmadinejad's father changed his surname has more to do with the class struggle in Iran. When it became mandatory to adopt surnames, many people from rural areas chose names that represented their professions or that of their ancestors. This made them easily identifiable as townfolk. In many cases they changed their surnames upon moving to Tehran, in order to avoid snobbery and discrimination from residents of the capital.

The Sabourjians were one of many such families. Their surname was related to carpet-making, an industry that conjures up images of sweatshops. They changed it to Ahmadinejad in order to help them fit in. The new name was also chosen because it means from the race of Ahmad, one of the names given to Muhammad.

According to Ahmadinejad's relatives the new name emphasised the family's piety and their dedication to their religion and its founder. This is something that the president and his relatives in Tehran and Aradan have maintained to the present day. Not because they are trying to deny their past, but because they are proud of it.

Trichet, Lagarde Push China to Let Currency Gain Against Euro

By Francine Lacqua and Mark Deen

Oct. 6 (Bloomberg) -- European Central Bank President Jean- Claude Trichet led the region’s finance chiefs in pushing China to let the yuan strengthen amid mounting concern the euro is shouldering too much of the burden of a sliding dollar.

Some currencies “have in the medium run to appreciate,” Trichet said in an interview with Bloomberg Television in Istanbul yesterday. French Finance Minister Christine Lagarde told Bloomberg that Europe’s economic recovery doesn’t justify further gains in the euro against the dollar.

The officials want China to do more to rebalance the world economy after it kept the yuan largely unchanged versus the dollar for more than a year, aiding its exporters and exposing those elsewhere to the dollar’s dive. The euro has gained about 16 percent versus the U.S. currency since May, raising concern among policy makers that it could slow their economy’s rebound from the worst recession since World War II.

“We need a rebalancing so that one currency doesn’t take the flak for the others” Lagarde said. “The European economy is not doing badly but it’s not doing so well that its currency can be the ultimate recourse.”

Trichet and Lagarde spoke two days after the G-7 published a statement repeating its mantra that volatility in exchange rates hurts economic growth. The communiqué didn’t single out the dollar or ratchet up rhetoric toward China, which is part of the G-20 club anointed by world leaders two weeks ago as the world’s primary forum for global economic cooperation.

‘Strong Dollar’

The dollar fell yesterday, weakening to $1.4637 per euro at 4:45 p.m. in London, from $1.4576 on Oct. 2.

The G-7 statement nevertheless “clearly says excess volatility is not welcome” in exchange rates, Trichet said in the interview. He appreciates “enormously” the U.S. Treasury’s stated preference for a “strong dollar.”

Finance officials are gathering in Istanbul for the annual meetings of the International Monetary Fund and the World Bank. They meet as the world’s major economies look to pursue policies that even-out so-called global imbalances, marked by a U.S. trade deficit and Chinese current account surplus, which they blame for helping trigger the recent financial crisis.

ECB Executive Board member Lorenzo Bini-Smaghi joined the chorus in calling on China to tie their currency less to the dollar and, by extension, the monetary policy of the U.S. Federal Reserve.

“The best way is that China starts adopting its own monetary policy and detach itself from the Fed’s policy,” said he said in a panel discussion in Istanbul.

Chinese Basket

China, which intervenes to control its currency’s value with reference to a basket of currencies including the euro, is often slow to respond to diplomatic pushes for a more flexible exchange rate. It took almost two years of international lobbying for it to break a peg with the dollar in July 2005. Economists and academics are unconvinced it will respond this time.

The head of China’s bank regulator said the yuan isn’t ready to assume the same stature as the euro and the dollar.

“I do hope that the countries with reserve currencies will be more responsible and we’ve got to be more supportive, and I think in the long-run I think together we can make some difference,” said Liu Mingkang in Istanbul. “It’s far too early to mention that the Chinese currency can be an international reserves currency.”

Further weakness in the U.S. currency means “we could get a battle of the printing presses as the Chinese try to match the printing of dollars by printing their own currency,” Harvard University Professor Niall Ferguson said in an Oct. 3 interview in Istanbul. New York University Professor Nouriel Roubini said that China has returned to an “effective peg by intervening and preventing any further appreciation of the yuan.”

Shalit deal could be last chance for prisoners with Israeli IDs

05/10/2009 18:02

Bethlehem – Ma'an – Over the past few days, serious progress has been made on wrapping up a prisoner swap deal between Israel and the captors of soldier Gilad Shalit, and several obstacles have been overcome through negotiations, our sources say.

However, neither side has yet confirmed that Israel approved a list of prisoners submitted by Hamas. The initial list has not included any Palestinian prisoners from inside Israel, or from Jerusalem.

According to the Israeli daily newspaper Haaretz, Hamas added 40 new names of prisoners who are also residents of Israel, including Jerusalem. Some of these detainees have been serving time in Israeli jails since before the Oslo Accords.

This new Hamas initiative, according to Haaretz, renews hope that they too could be released given that Israel refused to set them free in the latest prisoner swap deal between Israel and Hizbullah. Israeli authorities once refused even discussing the release of such prisoners, while today observers suggest this latest proposal might be their last chance.

Haaretz quoted Muneer Mansour, a former Palestinian prisoner who was freed in the 1985 prisoner swap between Israel and the Popular Front for the Liberation of Palestine-General Command, as saying, "Israel's refusal to release prisoners who hold Israeli IDs was overlooked in the 1985 deal, and that could happen again with the Shalit deal."

Mansour added that Israel may find a legal pretext to prevent the release of these Palestinians, however, there are also legal precedents that support the possibility. For example, some of them have spent more than 25 years in custody, and were detained before the Oslo Accords, thus they should have already been freed, or should be released within a few years.

Mansour highlighted that in the 1985 deal, to avoid releasing a prisoner with an Israeli ID, Audi Adeeb, Israel reduced one third of his sentence, and thus he was released as if he had already completed it. "This could be repeated in the Shalit case," Mansour said.

According to Haaretz, 147 Palestinian prisoners hold Israeli IDs, not including prisoners from East Jerusalem. Twenty-two detainees of those 147 were arrested before Oslo, and 21 were serving life sentences. In addition to these, there are 450 prisoners in Israel from East Jerusalem who also hold Israeli IDs.

Marwan Barghouthi: Israel is not a peace partner

October 4, 2009

Bethlehem – Ma’an – Jailed Fatah leader Marwan Barghouthi called for Palestinians to form a unified campaign of peaceful, popular resistance to Israeli settlements in an interview made public on Sunday.

In an interview from Israel’s Hadarim Prison through his lawyers, Barghouthi said that “there is no Israeli peace partner.

“Anyone who thinks that peace is possible with the current Israeli government and was not possible with the previous governments is being delusional,” he was quoted as saying.

In the interview he also praised caretaker Prime Minister Salam Fayyad’s plan to establish a Palestinian state, de facto, in the next two years. He called on the Palestine Liberation Organization (PLO) leadership, specifically, to endorse the plan, along with a program of peaceful resistance.

Barghouthi, a Fatah figure thought to have a political base extending beyond his own party, was jailed by Israel in 2002 for militant activity during the Second Intifada. In 2004 he briefly campaigned for the presidency from prison before endorsing Mahmoud Abbas.

The following are excerpts from the interview:

What are your thoughts on the anniversary of the Second Intifada?

I would like to express my deep respect for all Palestinians for their steadfastness, for not giving up their rights, no matter how much suffering they are facing and will face, because there is no compromise on freedom, return, and independence.

Do you think that a third Intifada is on its way?

The question that should be asked is why did the Al-Aqsa Intifada break out? Was it not because of the collapse of the peace process? Because the negotiation reached a dead end? Was it not because of continued settlement and Judaization in Jerusalem? The refusal [of Israel] to end the occupation and accept Palestinians’ rights? And now is there an Israeli partner for peace? The answer is a big ‘no.’ Did the settlements stop?

What is happening now is the height of settlement activity since 1967. In addition there is the Judaization of Jerusalem. First it was one home after another, now it’s one neighborhood after another. I am saying this loudly: anyone who thinks that peace is possible with the current Israeli government and was not possible with the previous governments, is being delusional.

The problem is that there is no leader in Israel either like Charles de Gualle in France who ended the colonization of Algeria, or like De Klerk, the president of Apartheid South Africa who handed over power to Mandela. Israel does not [want] peace and is not ready to end the occupation.

Intifada does not result from a decision by this official or that leader, or this faction or that. It comes from the collective will of the Palestinians. That’s what happened in the First and Second Intifadas.

What is needed now is a popular movement of peaceful resistance to confront settlement, a movement that has the participation of all the leaders, factions, organizations, and the Palestinian Authority. It is clear that the conditions that were in place when the Second Intifada broke out are still in place.

What do [you] think of the New York summit between President Mahmoud Abbas, Israeli Prime Minister Benjamin Netanyahu, and US President Barack Obama?

Honestly, I hoped it would not take place because the conditions of its failure are clear. It is regrettable that the American stance, as articulated by Obama and welcomed by Arabs, Muslims and Palestinians, has begun to evaporate. The Israelis and Americans are the ones who benefited from this summit.

It was important that President Abbas’ refused to resume negotiations before settlements come to a halt, and he should maintain this position. If the negotiations resume with such an [Israeli] government, what will we win?

I urge the Executive Committee of the PLO to insist that Israel commit to the principle of ending the occupation, withdraw to the 1967 borders, recognize Palestinians’ right to self-determination, establish an independent state with Jerusalem as its capital, recognize [UN] resolution 194, stop settlements, and release prisoners as a precondition to hold any negotiations with the Israeli government.

I hope we do not repeat the experience of previous years in which the Israelis took advantage of the negotiations in order to give them cover to continue expanding settlements and mislead world public opinion.

Is is possible to successfully confront Israel’s settlement project?

First, what is needed is a firm and consistent political stance on the basis we already discussed. Secondly, the PLO Executive Committee, with all of the factions, should set a plan and vision for a wide popular and peaceful movement against settlements. We need the Executive committee, the factions, and PLC members to turn up the heat on popular demonstrations.

What is needed from Israel and the US is a decision to end the occupation, not more negotiations. Negotiations have been going on for years and that’s enough. The Palestinian leadership should work to isolate Israel and put it under siege and force it to implement international resolutions.

Prime Minister Salam Fayyad had presented his plan titled “Palestine: Ending the occupation, establishing the state. Have you read this document? What you think of it?

I read the document more than once. I think it’s a good plan. It makes a the argument that ending the occupation is a precondition to establishing the state. But the PLO and the factions should compliment this plan with a blueprint for peaceful, popular resistance.

What are your thoughts on the efforts toward reconciliation and the current Egyptian proposal, especially since you were the one who initiated the national reconciliation document [the Prisoners’ Letter]?

The prisoners’ document was in fact the product of the collective will of the leaders of all the factions inside the prisons. It was an honor for me to participate in it along with the leaders of Hamas, Islamic Jihad, PFLP, DFLP and Fatah. It is still the best program for national unity.

I read the Egyptian proposal. It was sent to me through my lawyer Khader Ishqerat. I welcome this proposal. I am calling on all the national and Islamic factions to seize this opportunity to hold a comprehensive national dialogue to sign an agreement before the end of October, along with an urgent announcement of a date for new elections for the presidency, parliament, and PNC members, along with an end to media incitement, and political arrests. The factions must also release prisoners and turn a new page in relations on new bases of national partnership and pluralism, with regular elections.

When do you expect a prisoner exchange deal

We are following up with the media reports about this issue. We hope that a prisoner exchange will be carried out, in which all the prisoners will be released. The list submitted by Hamas did not exclude anyone and we support this firm stance.

Syria rescinds Abbas invitation amid UN controversy

05/10/2009 16:09

Bethlehem - Ma'an - Syria turned away President Mahmoud Abbas on Sunday, reportedly over his decision to delay a vote over South African justice Richard Goldstone's report on the Gaza assault last winter.

The president was originally scheduled to arrive in Damascus on Tuesday, following a brief state visit to Yemen that began on Sunday.

The Qatari network Al-Jazeera reported on Monday that Abbas' trip was suddenly called off in light of Syria's outrage over the Palestine Liberation Organization's decision in Geneva on Friday to stall debate on the report.

The wildly unpopular move led the UN Human Rights Council to delay approval for the Gaza fact-finding mission's results until March 2010 at the earliest.

Meanwhile, the Paris-based news agency AFP quoted a Palestinian official confirming that Damascus had "postponed" the visit, although the anonymous source insisted it had nothing to do with the Gaza report.

The real reason Syria pushed off the trip, the official said, was because of a "surprise" state visit from Saudi King Abdullah. The source did not mention whether there were plans to reschedule.

In any case, Damascus was outraged about the UN postponement, which, according to a number of reports, was ordered by Abbas at the behest of the United States and other Western powers seeking to protect Israel from international criticism.

"Syria was surprised by the request of the Palestinian National Authority [PNA] to postpone taking action," reported SANA, the Syrian state news agency.

It added, "Syria finds it strange that the PNA could go for delay, cutting short many Arab, Islamic and international efforts to take appropriate measures to put the report's recommendations into effect."

According to a government source quoted in the Syrian newspaper Al-Watan, Damascus "opted to cancel the visit... out of respect for the blood of martyrs and victims in Gaza, which Israel attacked for 23 days."

While the PA "markets itself as a defender of its people in the face of Israeli aggression," the official added, "Instead of seeking direct condemnation of Israel, the [Palestinian] Authority whitewashed the blood and corpses of innocent children, women and elderly civilians."

The independent newswire Champress quoted an official source as saying, "Damascus is preoccupied with a number of concerns at the moment, which may not allow us to accommodate Abu Mazen's [Abbas'] visit."

It said observers viewed the cancellation a result of "Palestinian Authority President Mahmoud Abbas' blatant rejection of the positions of Syria, and his policies toward the Goldstone report."

Meanwhile, the president touched down in the Yemeni capital of Sana'a on Sunday, and was previously scheduled to arrive in Damascus on Tuesday to meet Syrian leader Bashar Al-Assad and other senior officials, as well as Palestinians.

He was not expected to meet with Khaled Mash'al, Hamas' Damascus-based leader in exile, who sharply criticized the PA leader on Friday for the UN controversy.

Back in Palestine, several hundred Palestinians turned out for a demonstration in Ramallah.