Huge Ron Paul Banner greets Romney in Poland

July 31, 2012 by  
Filed under World


Congress Wants to See Obama’s “License to Kill”

July 31, 2012 by  
Filed under Americas

But if they get it, they won’t be allowed to show it to you.

obama iraq maps
Pete Souza/White House photo

Congress is finally standing up to President Barack Obama on targeted killing. Almost a year after three American citizens were killed in US drone strikes, legislators are pushing the administration to explain why it believes it’s legal to kill American terror suspects overseas.

Congress is considering two measures that would compel the Obama administration to show members of Congress what Sen. Chuck Grassley (R-Iowa) calls Obama’s “license to kill”: internal memos outlining the legal justification for killing Americans overseas without charge or trial. Legislators have been asking administration officials to release the documents for nearly a year, raising the issue multiple times in hearings and letters. But the new proposals, including one from Sen. John Cornyn (R-Texas) first flagged by blogger Marcy Wheeler and another in a separate intelligence bill, aren’t requests—they would mandate disclosure. That shift shows both Republicans and Democrats are growing impatient with the lack of transparency on targeted killings.

After radical American-born cleric Anwar al-Awlaki, alleged American Al Qaeda propagandist Samir Khan, and Awlaki’s 16-year-old son, Abdulrahman, were killed by drone strikes in Yemen in September and October of last year, Republican and Democratic members of Congress sent letters asking the Obama administration to explain the legal justification for targeted killing of American citizens. “We got a license to kill Americans, and we don’t know the legal basis for the license to kill Americans…because our letters haven’t been answered,” Grassley complained during a Senate Judiciary Committee hearing last week.

The New York Times has confirmed the existence of a secret memo from the Justice Department’s Office of Legal Counsel (OLC)—the branch of the government that tells the president whether what he wants to do is legal—outlining the legal basis for the targeted killing program. But the Obama administration has yet to acknowledge that any such memo exists, despite defending the targeted killing policy in speeches and public appearances, and is currently fighting an American Civil Liberties Union lawsuit that seeks to force the government to reveal the legal justification for targeted killing. Now Congress seems to be moving towards the ACLU’s position.

Cornyn’s amendment would require the Obama administration to provide the Office of Legal Counsel memo justifying the killing program to legislators on several congressional committees. Democrats on the Judiciary Committee voted to shelve Cornyn’s proposal, but that doesn’t mean the effort is dead. Cornyn could propose his amendment again later this year, and there’s also a section of a separate intelligence bill that would compel the administration to share all of the Justice Department’s legal opinions on intelligence matters with the congressional intelligence committees—unless the White House invokes executive privilege.

“We’re not mere supplicants to the executive branch, we are a coequal branch of government,” Cornyn said during discussion of his amendment in the Senate committee hearing last week. “So it is insufficient to say pretty please, Mr. President, pretty please, Mr. Attorney General, will you please tell us the legal authority by which you claim the authority to kill American citizens abroad?” (Cornyn also noted that just because he wants to see the memo doesn’t mean he’d necessarily disagree with its contents.)

Neither Cornyn’s proposal nor the intelligence bill would require the administration have to share the OLC memo with the media or the public, even in redacted form. But releasing the memo to legislators would at least allow Congress to perform more effective oversight of the targeted killing program, argues Chris Anders, legislative counsel for the ACLU. The Los Angeles Times reported in June that at the initiative of Sen. Dianne Feinstein (D-Calif.), who chairs the Senate Select Committee on Intelligence, Congress has been keeping a closer eye on the use of drone strikes. But critics like Anders argue that it’s hard for oversight to be effective if legislators don’t know what standard the Obama administration is using to determine whom to kill. “The key committees of Congress don’t even know what the legal standard is or how they’re applying it, so how can they do meaningful oversight?” Anders asks. The intelligence bill and Cornyn’s proposal could fix that problem.

More oversight, though, is not enough, Anders says—regular Americans should know what kind of conduct could lead to them being blown up by a deadly flying robot. “There’s a fundamental due process right to know what it is you can’t do in order to avoid getting killed by the order of the president,” he says. Grassley, at least, seems to be on board with that idea—a Grassley aide said the senator would “support making a redacted analysis public if possible.” A Feinstein aide also suggested a push for public disclosure could follow Congress getting access to the legal analysis of targeted killing. And even if the OLC memo is only shared with Congress, broadening access to the document makes it more likely that it could be leaked to the press.

Now that legislators on both sides of the aisle are pushing for more disclosure, the chances the public will learn about the contents of the targeted killing memos has increased dramatically. Still, Anders says, it’s easy to see a difference between how hard Congress pushed for George W. Bush-era memos authorizing torture and the deferential stance Congress adopted during the first three and a half years of the Obama administration.

“When it was Bush, it was much easier to get [legislators] to demand public disclosure,” Anders says.


More MoJo coverage of Obama’s targeted killings program:

ENDGAME: Iris Scan = Shorter Wait In Airport Security Line

July 31, 2012 by  
Filed under Sci-Tech

Gate rape by TSA was a managed problem to bring this very solution. The rest of us will be “profiled” and randomly harassed until we give in to “registered traveler programs.


iris scan 72326316 Iris Scan = Shorter Wait In Airport Security Line


A man uses an iris recognition scanner. (credit: Ian Waldie/Getty Images)


NORTH TEXAS (CBSDFW.COM) – It sounds like something out of the Tom Cruise movie Minority Report, but if you’re willing to pay a fee and get your iris scanned, you can jump to the front of the security line at Dallas/Fort Worth International Airport.

A company called CLEAR is offering the option to subscribers. After detailed verification, a member is issued an encrypted identity card that offers security gate privileges at participating airports.

“So when you enroll we authenticate your driver’s license and your passport,” CLEAR CEO Caryn Seidman-Becker explained. “We then gather your fingerprints, your iris images and your photo; building that impermeable link between your identity and your biometrics.”

The length of a few security steps is shortened, but members won’t go straight from the parking lot to the gate. CLEAR members are still required to go through the standard security check — the difference is, they don’t have to wait in line.

“So the CLEAR process is about ensuring your identity. So once you’ve gone through the process once, as opposed to flipping out your driver’s license every single time, all you have to do is put your card in and your finger down,” Seidman-Becker said.

The idea of handing over sensitive personal information has some concerned, but Seidman-Becker assured, “We [CLEAR] have built a highly-encrypted secure system, to ensure not only the integrity of the data but the privacy of our members data. We would never share or sell our members data.”

CLEAR has set up kiosks in Terminal E at DFW Airport. The service costs $170 a year.

The CLEARcard registered traveler service provider went bankrupt in 2009, but is back up and running under new management.

The Transportation Security Administration (TSA) also has a pre-screening program that is free.

Fluoride, a Chemical Weapon for Spiritual Warfare?

July 31, 2012 by  
Filed under Commentary

“Truth is so hard to tell, it sometimes needs fiction to make it plausible.”
Francis Bacon

Sometimes as a writer of science fiction and fantasy I have to depend on my imagination to come up with a good storyline. Of course the bad guys and the good guys have to be clearly defined. Usually the bad guys are some people, or humanoids, or beings with human qualities of some sort, that wish to exercise power over other people, or humanoids, or beings with human qualities of some sort. The good guys are people, et al., who wish to empower themselves and fend off the influence of the power seeking evil. In the telling of a good versus evil story it makes it interesting if there is a small group of good guys who realize that the bad guys are manipulating the innocent masses of people in horrendous ways. It then becomes incumbent upon the good guys to alert the populous to the manipulations, or at least to try to save the innocent even if they go unrecognized. Read more

(Penn St Redux) Holder’s DOJ, FBI Ignoring Child Sex Trafficking Cases — Informant

July 31, 2012 by  
Filed under Americas

Whistle Blowers are talking but who is listening? Bush / Ashcroft were not any better…


Via Godfather Politics

Eric Holder’s Department of Justice and the leadership of the FBI are blocking prosecution of human trafficking cases, including those involving minors being forced into prostitution, according to a Townhall magazine article by FBI informant Brandon Darby.

Darby and another FBI “human source,” Dottie Laster, helped investigate human trafficking for several months. Darby writes that he went undercover to gather information on sex traffickers with the help of a sympathetic FBI agent whom he refers to as “Agent X” to protect the agent’s identity.

What Darby uncovered was that cases were often ignored by law enforcement because law requires them to cooperate with ICE, but ICE would often raid the target of investigations before the law agencies could gather evidence necessary for prosecution. Rather than waste the money, time and effort, law enforcement often would just ignore trafficking cases.

The FBI also has a pattern of ignoring such cases, even those involving minors, because the FBI cannot get funding to house and protect the victims of trafficking until the U.S. Attorneys Office designates them as witnesses.

According to Darby, DOJ often didn’t want to get involved because designating many of these victims as witnesses involves obtaining various types of visas and other immigration paperwork.

This also requires signing of a law enforcement declaration of having the witnesses’ cooperation, which local officers in turn didn’t want to sign because they didn’t have a guarantee of resources.

And so the bureaucratic buck is passed.

Darby contends that politically appointed leaders in the FBI and Department of Justice are neglecting their duty to investigate and prosecute human trafficking cases, while hiding behind red tape.

But the allegations get worse.

Cases involving minors are supposed to trigger an automatic investigation by the FBI and Department of Justice. But Darby believes someone working within the FBI deliberately changed information to remove one or more victims’ designation as minors so that the FBI and DOJ would not be obligated to investigate.

Further, someone in the FBI leadership seems to have engaged in retribution against one or more agents who were investigating child sex trafficking, according to Darby, thereby endangering investigations, trafficking victims and the public at large. At least one agent in question was transferred and ordered not to investigate trafficking cases, Darby says.

Darby’s allegations should be investigated by Congress immediately. The Department of Justice and this Administration have already been covering up details of the Fast and Furious operation that delivered thousands of weapons to drug cartels and resulted in the murder of a Border Patrol agent and who knows how many other people.

If the Department of Justice is also abetting child sex trafficking, through negligence or otherwise, Attorney General Eric Holder needs to be removed and possibly even face criminal charges.

And given that so many of these human trafficking cases involve illegal immigrants or even U.S. citizens being smuggled over our porous Mexican border, King Obama’s recent unilateral enactment of amnesty, the Department of Homeland Security’s retaliation against Arizona law enforcement and the decision to close Border Patrol stations must be thoroughly investigated.

All of this raises a very disturbing question.

Taken individually, Fast and Furious, the Arizona immigration fight and the granting of amnesty by executive order could each be chalked up to cheap politicking — the Left trying to tighten gun control laws, and Obama trying to boost his popularity with Latinos.

But taken together and in light of Darby’s allegations, those actions by the Obama Administration seem to set up the perfect environment for human trafficking, along with smuggling of drugs and whatever else.

So the question has to be asked: Is it just a perfect storm of bungling, or is it possible this administration is actually, consciously, deliberately working with Central American drug cartels?

And if the answer somehow turned out to be yes, that the administration is working with the cartels, then it must be asked, to what end?

Read more: HERE

Aurora CO Massacre: Accused’s psychiatrist in threat assessment team

July 31, 2012 by  
Filed under Americas

Did she help CREATE the threat, or was she just conveniently “Incompetent” ?


A former University of Colorado graduate student accused of killing 12 people and wounding 58 others in a shooting rampage at a Denver-area movie theater last week had been under the care of a psychiatrist who was part of a campus threat-assessment team.

The disclosure came in court documents filed overnight, NZT, by lawyers for James Holmes, 24, who is accused of opening fire last weekend on a packed showing of the latest Batman movie, The Dark Knight Rises, in the Denver suburb of Aurora.

The defence attorneys, in their request to an Arapahoe County district judge, are seeking a court order requiring prosecutors to turn over the contents of a package that Holmes sent to Dr Lynne Fenton and was later seized by investigators.

”Mr Holmes was a psychiatric patient of Dr Fenton, and his communications with her are protected,” the filing said.

Fenton, medical director for student mental health services at the University of Colorado-Denver Anschutz Medical Campus, provides medication and psychotherapy for grad students in addition to her teaching duties, according to a school website.

A professional biography of Fenton posted on the site said she had conducted research on schizophrenia, including a two-year grant to work in the schizophrenia research department of the US Department of Veterans Affairs from 2008 to 2010.

Fenton is also a member of the campus-based ”behavioral assessment and threat assessment team,” which helps faculty and staff deal with ”individuals who may be threatening, disruptive or otherwise problematic,” according to that group’s website.

It could not be ascertained if Fenton was caring for Holmes under the threat-assessment programme or under routine counselling she provided to students on campus.

Under Colorado law, mental health professionals cannot be held liable in civil suits for failing to predict a patient’s violent behavior unless it involves a ”serious threat of imminent physical violence against a specific person or persons”. When such a threat is made, the mental health professional is required to take action, which may include notifying those targeted or a law enforcement agency.

Fenton could not immediately be reached by Reuters for comment, and a spokeswoman for the University of Colorado medical school declined to comment, citing restrictions under a gag order issued by the judge presiding over the case.

The university, where Holmes had been enrolled as a doctoral student of neuroscience, confirmed earlier this week that a suspicious package was delivered by mail on Monday and that it was ”immediately investigated and handed over to authorities within hours.”


Fox News has reported, citing an unnamed law enforcement source close to the investigation, that two packages were sent by Holmes to a psychiatrist on the faculty of the University of Colorado, and that one contained a notebook detailing the shooting scenario. According to Fox News, the notebook contained hand-drawn illustrations of stick figures shooting at other stick figures.

The defence motion accuses the government of leaking information to the media in defiance of a gag order, thereby jeopardising Holmes’ rights to due process and fair trial by an impartial jury. It says his lawyers will request a hearing to determine ”appropriate sanctions for this misconduct”.

Prosecutors, responding to the discovery motion, disputed various elements of media accounts as being erroneous, suggesting that anyone who had provided information to Fox News and other outlets lacked real knowledge of the case.

”These factual errors lead (the government) to believe … that the media is getting information from hoaxers, fraudsters, or maybe from nobody at all by creating fake ‘law enforcement sources’ out of whole cloth,” prosecutors said in their filing.

Formal charges against the suspect, who dyed his hair bright orange and was said by authorities to have referred to himself as the Joker – Batman’s comic book archenemy – are expected to be filed in court on Tuesday (NZT).

The judge in the case, William Sylvester, set a hearing on the defence discovery motion to be held as part of the proceedings. Sylvester also said he would consider a pleading by news media organisations to make public court documents the judge has sealed in the case.

Arrested within minutes of the shooting rampage at his car in the theater’s parking lot, Holmes is being held in solitary confinement in the local jail.

In addition to charges stemming from one of the worst outbursts of US gun violence in recent years, he is accused of wiring his apartment with enough explosives to have levelled the entire building if they had been detonated.

The apartment house was evacuated when the booby traps were discovered. But the explosives were later safely dismantled and removed by authorities and Holmes’ neighbours began returning to their homes on Wednesday night (local time).

The latest disclosures about the suspect came to light as mourners attended the third funeral in as many days for one of the victims of the shooting rampage, this one for an 18-year-old high school graduate, Alexander J ”AJ” Boik, who was bound for art college in the autumn.

Aurora’s Queen of Peace Catholic Church was filled with hundreds of mourners, including Colorado Governor John Hickenlooper, Aurora Mayor Steve Hogan and a contingent of Aurora police officers and firefighters.

Boik was one of the youngest among 12 people, aged 6 to 51, killed in the hail of gunfire. Of the 58 wounded, 12 remain hospitalised, including five in critical condition.

– Reuters

Predator drones to start operations over North Dakota

July 31, 2012 by  
Filed under Americas


US "Predator" drone (AFP Photo/Files/Joel SAGET)

US “Predator” drone (AFP Photo/Files/Joel SAGET)



The FAA has authorized the use of remote-controlled Predator drones in the airspace above nearly 10,000 acres in North Dakota. As of this fall, unmanned military aircraft will use lasers to aim at ground targets from nearly 2 miles above the earth.

Grand Forks, North Dakota — the third largest city in the state — will host a domestic training facility for the military’s unmanned aerial vehicles starting in October. Several times a week pilots will remotely guide robotic drones through the sky at altitudes as high of 9,999 feet above sea level and zone in on ground targets with the use of dangerous lasers.

“People may hear airplanes flying above, but there will be no lights visible and no explosions,” Col. Rick Gibney, commander of the 119th Wing of the North Dakota Air National Guard, tells the Grand Forks Herald. The lasers the drones will be equipped with are reported by the Herald to help pilots practice on designating targets for bombing and missile launching missions overseas.

Gibney adds that the site at Camp Grafton will allow pilots to have real-world training instead of relying on flight simulators to learn the basics of drone operation. And while he doesn’t expect for the base to be flooded with flights anytime soon, he says operations will increase over time, especially on an as-needed basis.

“A lot of it will be dependent on real-world situations,” he tells the Herald.

Meanwhile, the FAA says that traditional airplanes will continue to fly through the airspace, with around four flights currently traveling through the area each day. Gibney doesn’t expect that to be a problem though, because in other training grounds, such as other drone-licensed parts of Nevada and California,“There’s a lot of other aircraft in those areas, and a lot of commercial aircraft around those areas.”

Given the limited but still substantial amount of traffic in and around the airspace, opponents of the drone training ground are asking for more oversight into how the planes will behave come this fall. Specifically, some have raised questions about the dangers that could come from the lasers utilized by Predator drone pilots.

“Since the MQ–1 Predator [UAS] laser is non-eye safe and will be used during training sorties flown by the military, its use constitutes a hazardous activity that must be confined within restricted area airspace to protect nonparticipating aircraft,” the latest FAA regulations read.

Additionally, the Aircraft Owners and Pilots Association are arguing that the use of the lasers, if not properly announced to pilots ahead of time, could put their flights in grave danger.

The Electronic Frontier Foundation estimates that the number of domestic drones in the US will be 30,000 by the end of this decade. The Federal Aviation Administration is drafting ground rules right now that will lay out operation standards for UAVs in America, but some critics have suggested that the rate at which the US is accelerating its drone program is outstanding, citing concerns over both safety and privacy.

Within the last month, a military drone crashed during a routine training mission just outside of Washington, D.C. Days later, a professor at the University of Texas at Austin showed the US Department of Homeland Security that he was able to essentially hijack a drone using less than $1,000 in parts.

On Wednesday, Homeland Security Secretary Janet Napolitano said that the state of California is currently considering using surveillance drones as a means of proactively monitoring suspicious activity on the ground on the basis of “public safety” issues. At a recent lecture on domestic drones given by the EFF at New York City’s Hackers on Planet Earth Conference, Timm and fellow activist Parker Higgins said during a presentation that some surveillance UAVs “can zoom in and read a milk carton from 60,000 feet” off the ground.

DARPA’s Blue Angel – Pentagon prepares millions of vaccines against future global flu

July 31, 2012 by  
Filed under Sci-Tech

Fake Flu, or lab engineered plague coming? Predicted by Rockefeller Foundation for 2012 (back in 2010)Check your immune systems NOW!

Pentagon’s cutting edge research lab says that they’ve used a massive harvest of tobacco plants to help produce a plethora of flu-fighting vaccines.

Pentagon’s cutting edge research lab says that they’ve used a massive harvest of tobacco plants to help produce a plethora of flu-fighting vaccines.



The Pentagon’s DARPA lab has announced a milestone, but it doesn’t involve drones or death missiles. Scientists at the Defense Advanced Research Projects Agency say they’ve produced 10 million doses of an influenza vaccine in only one month’s time.

In a press release out of the agency’s office this week, scientists with DARPA say they’ve reach an important step in being able to combat a flu pandemic that might someday decimate the Earth’s population. By working with the Medicago Inc. vaccine company, the Pentagon’s cutting edge research lab says that they’ve used a massive harvest of tobacco plants to help produce a plethora of flu-fighting vaccines.

“Testing confirmed that a single dose of the H1N1 VLP influenza vaccine candidate induced protective levels of hemagglutinin antibodies in an animal model when combined with a standard aluminum adjuvant,” the agency writes, while still noting, though, that “The equivalent dose required to protect humans from natural disease can only be determined by future, prospective clinical trials.”

Researchers have before relied on using chicken eggs to harvest compounds to use in influenza vaccines. With a future outbreak requiring scientists to step up with a solution as soon as possible, though, they’ve turned to tobacco plants to help produce the vaccines.

“Vaccinating susceptible populations during the initial stage of a pandemic is critical to containment,” Dr. Alan Magill, DARPA program manager, says in an official statement. “We’re looking at plant-based solutions to vaccine production as a more rapid and efficient alternative to the standard egg-based technologies, and the research is very promising.”

The World Health Organization has gone on the record to say that as much as half of the people on the planet could be affected by a pandemic in the near future, and it could take as much as nine months for a vaccine for a pandemic virus strain to become made available. With the lives of billions of people across the world at stake, DARPA has been trying to determine new ways of churning out antidotes in as little time as possible. Now its researchers say, that in only a month, scientists “produced more than 10 million doses (as defined in an animal model) of an H1N1 influenza vaccine candidate based on virus-like particles (VLP).”

Through DARPA’s previously established Blue Angel program, researchers have spent several years searching for new ways to produce mass quantities of vaccine-grade protein that could be used to combat what they say are very real emerging and novel biological threats.

Andy Sheldon, Chief Executive Officer of Medicago , says in the company’s own press release that “The completion of the rapid fire test marks a substantial achievement in demonstrating our technology and the potential for Medicago to be the first responder in the event of a pandemic flu outbreak.”

Medicago’s research was conducted in a 97,000-square-foot vaccine facility in North Carolina that was funded through a $21 million Technology Investment Agreement with DARPA.

Fed Head Bernanke threatens Congress: We’re Much Closer to Total Destruction Than You Think

July 31, 2012 by  
Filed under Economy



Official Congressional budget estimates understate the peril of rising debt, Fed chair Ben Bernanke told the Budget Committee on Capitol Hill today.

Warning that our nation’s fiscal health has deteriorated appreciably since the onset of the financial crisis and the recession, Bernanke called upon lawmakers to confront the long term fiscal challenges sooner rather than later. If lawmakers don’t confront them, they’ll find themselves confronted by them.

From Bernanke’s prepared remarks:

By definition, the unsustainable trajectories of deficits and debt that the CBO outlines cannot actually happen, because creditors would never be willing to lend to a government with debt, relative to national income, that is rising without limit. One way or the other, fiscal adjustments sufficient to stabilize the federal budget must occur at some point. The question is whether these adjustments will take place through a careful and deliberative process that weighs priorities and gives people adequate time to adjust to changes in government programs or tax policies, or whether the needed fiscal adjustments will come as a rapid and painful response to a looming or actual fiscal crisis.

Bernanke explained that the Congressional Budget Office’s calculations miss an important reality. As the government’s debt and deficits rise, the economy will slow down—an effect not taken into account by the CBO. So, for instance, when the CBO says that federal spending for health-care programs will roughly double as a percentage of GDP in the next 25 years, it is probably being too optimistic. If debt keeps, rising, GDP will be much lower than the CBO estimates—which will mean that health care spending will be a much larger percentage of the overall economy.

Here’s Bernanke on the effect of rising debt:

Sustained high rates of government borrowing would both drain funds away from private investment and increase our debt to foreigners, with adverse long-run effects on U.S. output, incomes, and standards of living. Moreover, diminishing investor confidence that deficits will be brought under control would ultimately lead to sharply rising interest rates on government debt and, potentially, to broader financial turmoil. In a vicious circle, high and rising interest rates would cause debt-service payments on the federal debt to grow even faster, resulting in further increases in the debt-to-GDP ratio and making fiscal adjustment all the more difficult.

In short, the official estimates members of Congress hear from their budget office are under-estimating our dire economic predicament. If fiscal policy is not brought under control, things will be much, much worse.

Rate-Fixing Scandal (Libor) Deepens as UBS Report Is Revealed / Facebook Float Crashes Banks

July 31, 2012 by  
Filed under Economy


A political row in Britain over fixing of interbank lending rates deepened on Saturday after the publication of confidential advice from UBS to the previous Labour government on how to reduce the key Libor rate at the height of the financial crisis in 2008.



The Conservative-led coalition, trailing in    opinion polls, has tried to pin part of the blame for the rate-fixing by bank traders on the government of former Labour Prime Minister Gordon Brown, questioning whether it directly or indirectly sanctioned the manipulation.

The chairman and chief executive of Britain’s Barclays [BCS  10.62        ] both resigned this week after the bank agreed to pay nearly $450 million for its part in rigging the Libor rate between 2005 and 2009, which is used to settle interest rates on trillions of dollars of contracts globally.

The scandal has reignited anger in Britain against bankers, who are blamed for a deep recession the country is struggling to escape.

Labour, now in opposition, said the coalition government had tried to smear the party by insinuating that the confidential advice was about the deliberate manipulation of the Libor rate.

The advice, in a note titled “Reducing Libor, improving lending conditions,” was sent from Swiss-based bank UBS [UBS  11.06        ] to the Treasury at a time when lending between banks had all but dried up over fears they might collapse.

Instead, the document, published in the Financial Times, “simply proposes legitimate policy improvements” to reduce the cost of banks lending to each other during the credit crunch, Labour said.

It called on the coalition’s finance minister George Osborne to withdraw “false allegations” that people close to Brown were at fault over the rate-fixing scandal.

“There is absolutely nothing in this note about the deliberate fixing of the Libor rate, which Barclays traders were involved in,” said Labour finance spokesman Chris Leslie.

No immediate response was available from either Osborne or Gordon Brown.

Credit Crunch

In the document, UBS suggested that the Libor rate could be reduced if the government cut the cost of a credit guarantee scheme (CGS), which backed bank lending, to levels operating in a similar scheme in the Netherlands.

“Libor will fall significantly quicker if the cost of the CGS, under one year, is reduced; so that banks can borrow unsecured at an all-in cost which is less than Libor,” said the note, written on Nov. 1, 2008.

UBS said it had no comment to make on the publication of the report. There was no immediate comment from the Treasury.

Although the document appears to contain no “smoking guns” to implicate the Brown administration, it indicates that government’s concern at the time to lower the Libor rate and get credit flowing again between banks.

The fallout from the Libor scandal widened to the political sphere after Bob Diamond, who quit as Barclays chief executive this week, said Paul Tucker, now deputy governor of Britain’s central bank, had called him in October 2008 to relay concerns from within government about the high level of Barclays’ funding costs.

Barclays has said the conversation was understood by a senior executive, Jerry del Missier, to be an instruction to lower the bank’s reported Libor rate, which he duly passed on to the bank staff concerned. Del Missier, who also resigned this week, has not commented on the matter.

It remains unclear whether Tucker was referring to government ministers or officials and the policy maker is not due to give his side of the story until he testifies before a parliamentary committee on Monday.

Fiery Exchanges

In the meantime, Osborne has sought to exploit the uncertainty by saying former Labour ministers had questions to answer.

The Conservatives have fallen behind Labour in opinion polls since a badly received budget in March, when Osborne cut the top rate of tax for the biggest earners and raised tax on the elderly, prompting opposition charges that the government was out of touch with austerity-hit Britons.

One area of Osborne’s attack on Labour was the UBS document, not made public until now. Osborne said there were questions over the role played by former Labour treasury minister Shriti Vadera, who has confirmed she made comments on the document at the time.

Osborne’s main target has been Labour’s treasury spokesman Ed Balls, a former treasury minister and close ally of Gordon Brown, with the two clashing in fiery exchanges in a parliamentary debate on Thursday.

Balls rejected as “utterly false and untrue” suggestions by Osborne he had been involved in government discussions on Libor at the time of the credit crunch, when he was schools minister, accusing his rival of “cheap and partisan” attacks.

Vadera has said she commented on the report but added that it was legitimate for the government and regulators at the time to be concerned about why the cost of interbank lending, reflected by the Libor rate, had stayed stubbornly high.

“That shouldn’t be confused in any way with the actions of people who may be … manipulating how they set Libor,” she told the BBC.

“I did not speak to Paul Tucker or anyone at the Bank of England about the rate-setting of Libor … I commented on the note, in particular to focus the issues on the lending conditions in the real economy for real people,” she said.

The rates submitted by banks are compiled by Thomson Reuters, parent company of Reuters, on behalf of the British Bankers’ Association.


UBS May Have Facebook Trading Loss of $350 Million

The issue has to do with the failure to get confirmations and executions from the Facebook [FB  23.15        ]trade.

It is not clear whether UBS has hedged this loss in anyway.

UBS was not part of the deal to take Facebook public, and Nasdaq is having discussions with all of the major banks and wholesalers to understand where the liability lies.

However, many have criticized the deal as being mispriced and too big, and said the system overwhelmed.

On Wednesday, Nasdaq CEO Robert Greifeld told CNBC that the company had been “embarrassed” by the botched Facebook IPO, but the exchange has not direct responsibility to individual investors.

Facebook Will Disappear in 5 to 8 Years: Analyst


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