Obama Approves Minsk Agreement, Great for Putin

The new Minsk ceasefire agreement empowers Russia-backed separatists with a number of leverages over Ukraine. If implemented, the agreement could provide a functioning framework for a mutually acceptable political settlement. In the event of non-implementation, a re-eruption of hostilities is highly likely.

                          

In Minsk on 12th February, Ukrainian President Petro Poroshenko, Russian President Vladimir Putin, German Chancellor Angela Merkel and French President François Hollande managed to reach an agreement on the ceasefire in Eastern Ukraine, and the outlines of a conflict settlement.

Formally, the document was signed not by the heads of state, but by the Trilateral Contact Group (composed of representatives of Ukraine, Russia and the OSCE) as well as the leaders of the Donetsk and Luhansk separatists. This indirect scheme allowed Kyiv to reach an agreement with the separatists without formally recognizing them as legitimate partners.

The document, composed of thirteen points, refers to the separatist entities as “particular districts of Donetsk and Luhansk oblasts”, using the same wording as the September 2014 Minsk agreement. Hence, neither their self-proclaimed names, Donetsk and Luhansk People’s Republics, nor the Russian term Novorossiya are used, which is a strong signal that none of the parties questions that these regions belong to Ukraine.

                       

*** So what else needs to be known? Who is still supporting Putin and why….

The segments of the Russian population that, arguably, have the best chance to dissuade President Vladimir Putin from his actions in Ukraine are business leaders and the rich. But despite having lost millions of dollars because of sanctions against Russia , the falling ruble and low oil prices, they still rally behind their leader-both privately and publicly.

Despite a cease-fire announced Thursday , Western sanctions on Russia over its support of insurgents in neighboring Ukraine have already pushed Russia’s borrowing costs higher and crushed its currency (Exchange: RUBUSD=). The problems have been made worse by the price of oil, whose fall since September has further undercut the petro-state’s ability to fund itself. Yet Putin still enjoys broad domestic support, and experts tell CNBC that the country’s monied class is no exception. Timothy Ash, who heads emerging markets research at Standard Bank (Johannesburg Stock Exchange: SBK-ZA), summarizes the phenomenon in a few words: “Nationalism plays very well with many people,” he told CNBC

Alexander Kliment, director of Russia research at Eurasia Group, said the sanctions have actually strengthened elite support for Putin because they have bolstered the government’s position as a last-resort lender for them. “Also, sanctions have inflamed patriotic sentiment and been a convenient scapegoat for economic woes,” Kilment told CNBC.

“If you are an oligarch, it’s bad to suffer sanctions from the West,” he said, “but you’re still pretty well-off as part of the Russian system. It’s an awfully big leap to turn your back on that, which would risk literally everything you have.” Read More Total CEO: US will not become energy independent Edward Mermelstein, a New York-based attorney who works with Russian business clients, told CNBC that Putin’s popularity is no longer dependent on finance as much as the might of Russia.

“As long as the country is perceived as strong, he will continue to dominate domestically. The Russian citizen can withstand famine, but they cannot withstand the appearance of weakness,” he said.

While some companies are getting hit hard by what Russian Finance Minister Anton Siluanov has acknowledged is an economy in “dire straits,” others are finding ways to benefit.

*** Now comes the alternate banking system. Almost 91 domestic credit institutions have been incorporated into the new Russian financial system, the analogous of SWIFT, an international banking network.The new service, will allow Russian banks to communicate seamlessly through the Central Bank of Russia. It should be noted that Russia’s Central Bank initiated the development of the country’s own messaging system in response to repeated threats voiced by Moscow’s Western partners to disconnect Russia from SWIFT.

Russian Prime Minister Dmitry Medvedev meeting with miniters

SWIFT (The Society for Worldwide Interbank Financial Telecommunication) is a Belgium-based international organization that provides services and a standardized environment for global banking communicating that allows financial institutions to send and receive messages about their transactions. Earlier this month Russian Deputy Prime Minister Igor Shuvalov expressed confidence that Russia would not be disconnected from SWIFT. In her turn, Russian Central Bank First Deputy Chair Ksenia Yudaeva called upon Russian civilians and financial institutions not to dramatize the current situation.Russian experts point to the fact that Western businesses would face severe losses if they expelled Russia from the international SWIFT system. On the other hand, the alternative system launched by Russia might reduce the negative impacts caused by measures imposed by the West, including possible disconnection from SWIFT, and diminish Western financial dominance over Russia.

 

Denmark Killer had Criminal History

He is now dead but at the time The gunman suspected of killing two people after opening fire on a free speech debate and a synagogue in Copenhagen on Saturday was identified tonight as 22-year-old Omar Abdel Hamid El-Hussein, a Danish national with a history of gang violence.

Copenhagen Police said the alleged terrorist, who was killed in a shootout with officers in the early hours of Sunday morning, had previously committed “several crimes” including assault and the possession of weapons.

At least two other people were arrested on Sunday, being led out in handcuffs from an internet café in Copenhagen, as part of the police investigation into how the gunman came to arm himself and pick his targets.

Jens Madsen, the head of Denmark’s security service, said he may have been “inspired by militant Islamist propaganda issued by IS [Islamic State] and other terror organisations”. It is not yet known. *** Now it is known.

Danish jihadi murderer freed from prison 2 weeks ago after knife attack by Robert Spencer:

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Omar Abdel Hamid El-Hussein“We do not have concrete knowledge of him being a traveller to conflict zones.” So he is just a believer in a belief system that all Western authorities insist has nothing to do with attacks like this one, although the attackers themselves continually point to it as their motivation.

“Pictured: Danish lone wolf ‘jihadi’ who was gunned down by police after terror shootings which killed film director and Jewish security guard – weeks after he was released from prison over knife attack,” by Sophie Jane Evans, Laurie Hanna, Flora Drury, Jennifer Smith and Mark Duell, MailOnline, February 15, 2015:

This is the first picture of the terror suspect believed to have killed a film director and Jewish security guard in two attacks in Copenhagen.

Danish-born Omar Abdel Hamid El-Hussein, 22, was killed after opening fire on officers who had closed down the area surrounding Norrebro metro station at about 5am today.

The man – whom police said is known to them due to past violence, gang-related activities and and possession of weapons – is thought to have killed two people in separate attacks at a free speech event and a synagogue.

Film director Finn Noergaard, 55, was killed yesterday at a cafe. Hours later, 37-year-old security employee Dan Uzan was shot in the head as he stood outside a building belonging to the city’s Great Synagogue.

Also, it was revealed tonight that El Hussein was released from prison two weeks ago after serving part of a jail sentence for a knife attack on a teenage train passenger in 2013.

This afternoon two people were led out of an internet cafe in handcuffs as part of the probe.

Earlier, at 5am police closed in on Norrebro station as the suspect emerged with a weapon from an address police were watching.

The man was killed in the street after opening fire on those who had cornered him, his body seen lying on the pavement as forensic teams swooped the scene at dawn.

Asked if the suspect was linked to any known terrorist groups, a police spokesman said: ‘We do not have concrete knowledge of him being a traveller to conflict zones.’…

Islamic State Beheads 21 Christians in Libya

Before the killings, one of the militants stood holding a knife and said in a North American-accented English: “O Crusaders, safety for you will be only wishes, especially when you’re fighting us all together. Therefore, we will fight you all together, until the war lays down its burdens, and Jesus, peace be upon him, will descend, breaking the cross, killing the swine and abolishing jiziyah.”

The prisoners were then forced down to their knees, and then beheaded.

CAIRO (Reuters) – President Abdel Fattah al-Sisi said on Sunday that Egypt reserved the right to respond in a way it sees fit to the Islamic State’s beheading of 21 Egyptians in neighboring Libya.

Sisi warned Cairo would choose the “necessary means and timing to avenge the criminal killings”. He was speaking on national television hours after Islamic State released a video purportedly showing the beheading of 21 Egyptian Christians in Libya.

Dabiq #7, the Islamic State magazine provided advanced notice and the Libyan faction calls itself the Tripoli Province of the Islamic State. Of note General David Rodriguez of AFRICOM warned of these camps months ago when Abu Bakr al Baghdadi announced branches in Saudi Arabia, Yemen, Egypt, Algeria and Libya.

Screen Shot 2015-02-15 at 9.07.59 AM.png

A video released by the Islamic State shows fighters from one of its so-called provinces in Libya beheading 21 Egyptian Copts. The mass murders were advertised by Islamic State’s media operatives over the past couple of days. And the latest edition of the organization’s English-language magazine Dabiq, which was released last week, implied that the men had been killed.

In a scene that is similar to past videos from Iraq and Syria, the Islamic State’s victims are ritualistically walked along the coast of the Mediterranean Sea before being forced to kneel with their captors standing behind them.

An English-speaking fighter then talks, saying that he and his fellow jihadists are sending a message from “the south of Rome,” thereby threatening Italy. In recent weeks, members of the Italian government have called for more aggressive international intervention in Libya.

The fighter then says that the Islamic State and its allies will continue to fight the “Crusaders” until Jesus comes again. This is a reference to the apocalyptic Islamic belief that Jesus will reappear at the end of days.

The Islamic State’s head executioner says that the West hid Osama bin Laden’s body in the sea, and so the jihadists will mix the West’s blood in the same sea.

After the men are beheaded, the English-speaking fighter raises his knife to the water and swears that the Islamic State will conquer Rome.

The fighter’s reference to Osama bin Laden stands in stark contrast to the Islamic State’s denunciation of Ayman al Zawahiri, bin Laden’s successor as al Qaeda chief, in the latest edition of Dabiq.

The Islamic State claimed in Dabiq that the kidnapping of the 21 Egyptian men came “almost five years after the blessed operation against the Baghdad church.” That attack was launched in late 2010 by the Islamic State of Iraq (ISI), the predecessor to the current Islamic State. The ISI claimed at the time that the suicide assault, which left dozens of people dead, was revenge for the supposed mistreatment of women in Egypt.

Abu Bakr al Baghdadi’s propagandists repeated this claim in Dabiq. But the Islamic State added that al Qaeda spokesman Adam Gadahn, referred to by his nom de guerre Azzam al Amriki, condemned the act “in some of his letters” to the group. The Islamic State accused Gadahn of acting “on his personal rancor towards the Islamic State as soon as he became a top leader of [al Qaeda] after the martyrdom of” Osama bin Laden. Gadahn’s critique of the Islamic State’s practices are well-known, and his role in al Qaeda’s senior ranks predates bin Laden’s death.

The authors of Dabiq also accused Zawahiri of defending the Copts. “I want to restate our position towards the Coptic Christians. We do not want to get into a war with them because we are busy in the battle against the greatest enemy of the Ummah [America] and because they are our partners in this nation, partners whom we wish to live with in peace and stability,” the Islamic State quoted Zawahiri as saying.

“So while the Islamic State targeted the Catholics in revenge for the sisters imprisoned by the Copts, Azzam al Amriki’s commander [Zawahiri] was wooing the war-waging Copts themselves with feeble words,” Baghdadi’s men claimed in Dabiq.

The Islamic State has accused al Qaeda of being soft on Iran, as well as the Shiites in Iraq and Yemen. In executing the 21 Egyptian Copts, Baghdadi’s organization extended this argument further, claiming that al Qaeda weakly opposes, or does not oppose at all, Egypt’s Christians.

9 of the coptics

Thus, the beheadings shown in the newly released video were intended to both intimidate Italy and to portray al Qaeda’s leaders as being weak-minded in their pursuit of jihad.
Read more here.

Ukraine has a Deadly History

A cease fire was signed this week known as the Minsk Agreement. The ink was not dry and the hostilities continued. So looking back on Ukraine’s history is a look at today and tomorrow.

After hours of beatings, the men in black took Lutsenko into the woods, put a bag over his head, made him kneel in the snow and told him to say his prayers. Then they walked away.

Not long after Lutsenko emerged, Verbytsky was found in the same woods, bound in duct tape, his ribs broken, internal organs smashed. An autopsy showed he froze to death. What is a cause of Putin’s military aggression over Ukraine?

Oil.

Ukraine’s state gas and oil company Naftohaz has reported discovering a sizeable oil field on the country’s territory.

Nafothaz said late July 11 that the discovery was one of the largest oil fields found in Ukraine in some 15 years.

Naftohaz believes the Budishchansko-Chutovskoyefield in eastern Ukraine’s Poltava region, contains some 12.8 million tons of oil.

Naftohaz has been working the site since 2011 and the company’s public relations department said it was the first oil field owned solely by the Ukrainian company.

Ukraine’s government is attempting to wean the country off its dependence on Russian energy supplies. Kyiv has placed a priority on developing the country’s own energy resources and diversifying sources for importing energy supplies.

*** Yet Ukraine’s history is a look back at what is underway today.

Ukraine was formally incorporated into the USSR as the Ukrainian Soviet Socialist Republic (UkSSR) in 1922.
The Communists were aware that resistance to their regime was deep and widespread. To pacify the Ukrainian  people and to gain control, Moscow initially permitted a great deal of local autonomy to exist in the UkSSR. The
newly established Ukrainian Autocephalous (self-ruling) Orthodox Church and the new All-Ukrainian Academy of  Sciences, non-Communist national institutions of great importance, were both permitted to continue their work
until the end of the 1920’s.

All of this changed once Joseph Stalin came to power. Stalin wanted to consolidate the new Communist empire  and to strengthen its industrial base. Ukrainian national aspirations were a barrier to those ends because even
Ukrainian Communists opposed exploitation by Moscow. In Stalin’s eyes, Ukraine, the largest of the  non-Russian republics, would have to be subdued. Thus, the Ukrainian Autocephalous Orthodox Church was
placed under the jurisdiction of the Communist-controlled Russian Orthodox Church. Ukrainian bishops, priests  and thousands of Christian lay leaders were sent to Siberian labor camps, the so-called “Gulag.” Hundreds of
thousands, possibly over a million, of Ukraine’s intellectual leaders – writers, university professors, scientists,  and journalists – were liquidated in purges ordered by Stalin. Not even loyal Ukrainian Communists were exempt
from Stalin’s terror. By 1939, practically the entire (98%) of Ukraine’s Communist leadership had been  liquidated.

Hardest hit by Stalin’s policies were Ukraine’s independent landowners, the so-called “kulaks” (kurkuly in  Ukrainian). Never precisely defined, a kulak was a member of the alleged “upper stratum” of landowners but in
reality anyone who owned a little land, even as little as 25 acres, came to be labeled as a kulak. Stalin ordered  that all private farms would have to be collectivized. During the process, according to Soviet sources, which are
no doubt on the conservative side, some 200,000 Ukrainian families were “de-kulakized” or dispossessed of all  land. By the summer of 1932, 69.5% of all Ukrainian farm families and 80% of all farm land had been forcibly
collectivized.

Stalin decided to eliminate Ukraine’s independent farmers for three reasons:
(1) they represented the last bulwark of resistance to totalitarian Russian control;
(2) the USSR was in desperate need of foreign capital to build more factories and the best way to obtain
that capital was to increase agricultural exports from Ukraine once known as “the breadbasket of
Europe”;
(3) the fastest way to increase agricultural exports was to expropriate land through a process of farm
collectivization and to assign procurement quotas to each Soviet republic.
During the collectivization process, Ukrainian farmers resisted vigorously, often violently, especially when the  GPU (Soviet secret police) and militia forced them to turn their land over to the government. Thousands of
farmers were killed and millions more were deported to Siberia to be replaced by more trustworthy workers.

*** Fast forward to the 1980’s, were marked by increasing political impotence of Soviet leadership. The Chernobyl Nuclear Power Plant accident of April 26,1986, brings back painful memories for all Ukrainians. This disaster caused tens of thousands of deaths and health related problems, and inflicted enormous ecological and economic damage. Chernobyl served to rock the Communist Party establishment with political fallout as the facts behind bureaucratic ineptitude, negligence, disregard for the ordinary citizens, and cover-up emerged and began to stir the minds of the people.

On July 6, 1990, the legislature proclaimed Ukraine’s sovereignty. In August 1991, a failed three-day military coup of the Kremlin’s would-be dictators led to the Declaration of Independence by the Verhovna Rada (Parliament) on August 24. On December 1, in a nationwide referendum, 93% of Ukraine’s citizens voted for an independent Ukraine and chose Leonid Krawchuk, former communist ideologist, as their first democratically elected President. On July 10, 1994, Leonid Kuchma, former director of the world’s biggest rocket plant, defeated Leonid Krawchuk to become the second President of independent Ukraine.

Following the Orange Revolution, on December 26, 2004, after two rounds of falsified elections, Viktor Yushchenko beat the Kremlin-backed candidate in the third round. Under Yushchenko, Ukraine finally became free from Moscow’s 300-year domination. *** Can Ukraine survive the current Soviet loyalists aggression? Not without assistance from the West, but will that assistance come?

It’s Your Money and the Democrats Don’t Care

Do you know how legislative bills begin and then what happens? Do you know what they may cost the taxpayers?

Sponsors of 700 bills in Congress didn’t put price tags on their proposals

Almost half of the bills introduced in the last Congress authorized spending tax dollars, but not specifically how many dollars. Instead, the proposals simply provided that “such sums as necessary” should be spent.All 20 congressmen who most frequently used the “such sums as necessary” formulation are liberals and among the most ardent proponents of expanding the federal government. House Republicans were advised by their leaders not to use the phrase, but some of them ignored the advice.Vermont Sen. Bernie Sanders, a self-proclaimed “Democratic socialist,” led the list as the sponsor of 19 such bills.

His 10 Million Solar Roofs Act of 2014, for example, would require “the Department of Energy (DOE) to establish a program to provide rebates for the purchase and installation of photovoltaic systems with the goal to install 10 million systems.”

The Sanders bill provided specific instructions for what the government would need to do, and the cost of the solar panels would be known to his staff. The goal of the bill — increasing alternative energy sources — has significant public support. But Sanders didn’t include how much his proposal would cost, thus depriving his congressional colleagues and taxpayers of the means to weigh benefits versus costs.Nowhere in the bill is there a cost figure. It simply says “there are authorized to be appropriated such sums as are necessary to carry out this Act.”Florida Democrat Rep. Alan Grayson’s Fiscal Sanity Act for Appropriations bill is another whose cost is simply as much “as necessary.”

“It shows they aren’t serious fiscal stewards — they aren’t concerned with how much it costs, often-times. If they were, they could write in offsets saying ‘this fund over here will be decreased by the amount necessary,’” said Demian Brady, who tracks individual congressmen’s spending propensities for the National Taxpayers Union.

“It could also be a way to avoid accountability. If they did say $20 million for a gun buyback program, media and everyone would say she wants to spend $20 million. If you leave it blank, it’s a shield you can hide behind, even if they know how much it’s going to cost,” he said.  Some were token efforts that sponsors never expected to go anywhere — they were introduced only so their sponsors could tell campaign backers that they tried. But occasionally those proposals wind up becoming policy anyway.“They say, ‘we didn’t bother to get an estimate because we didn’t expect it to go anywhere,’ but then soon we’ll find it as part of bigger legislation,” Brady said.When Rep. Maxine Waters wanted a “minority diabetes initiative,” the California Democrat didn’t care how much it cost, and didn’t attempt to measure it, craft a budget estimate or find a way to fund it. Instead, she asked colleagues to essentially vote for a blank check.

Pennsylvania Democratic Sen. Bob Casey’s Caregiver Corps Act of 2014 would require the Department of Health and Human Services to “contract with a nonprofit” and “[a]llows the Secretary to award grants for the operation of local Corps programs.”Yet there is no mention of cost anywhere. At the very end of the description of the proposed program, it says simply, “There is authorized to be appropriated to carry out this section, such sums as may be necessary.”“It’s very bad practice to put these things in place because they also lead to bloated appropriations. The authorizers have kind of punted,” said a senior Senate Republican aide. “We’d like to have all the authorizers be more accountable to things.”

Congress must first pass a bill “authorizing” money to be spent, and then another, separate appropriation bill officially funds it — generally one of a few major bills passed by the appropriations committee.

The handful of powerful congressional “appropriators” who meet in back rooms and until recently were able to dole out earmarks as favors have been the subject of significant ire as poster children for what is wrong with Washington.

But when lawmakers write bills that “authorize” funding without specifying amounts, they are ceding authority to the appropriations committees, who will have to fill in an amount, even though they’re much less acquainted with the purpose.

The Examiner analyzed legislation from the two-year congressional session that ended last month. Dollar amounts — or lack thereof — were extracted from the bill text by the Cato Institute as part of the libertarian think tank’s Deepbills project.

One reason for the Democratic dominance of the “such sums as necessary” list is that Democrats introduce more bills in general than Republicans. But another is that House Republican leadership cautioned its members not to use “such sums as necessary” at the beginning of last Congress, as one of nine “legislative protocols.” “Any bill or joint resolution authorizing discretionary appropriations shall specify the actual amount of funds being authorized,” the protocol says. “This protocol is designed to improve transparency and accountability in the authorization of discretionary programs.”

But it only discourages, not forbids, House Republicans from using the technique. The House Select Committee on Benghazi, formed to investigate Hillary Clinton’s State Department, was funded by “such sums as necessary,” leading Democrats opposed to the investigation to protest that it is irresponsible to allocate open-ended amounts of money with no end date.

And it doesn’t bind senators, who lead the list in bills introduced.

Sanders and Sen. Bob Menendez, D-NJ. the most frequent users, didn’t respond to the Examiner’s requests for comment.

WRITING THE MOST BLANK CHECKS

Name Bills
Sen. Bernard Sanders (I-VT) 19
Sen. Robert Menendez (D-NJ) 14
Sen. Tom Harkin (D-IA) 13
Sen. Mark Begich (D-AK) 13
Sen. Patty Murray (D-WA) 11
Sen. Richard Blumenthal (D-CT) 10
Sen. Tom Udall (D-NM) 10
Sen. Al Franken (D-MN) 10
Rep. Sheila Jackson Lee (D-TX) 9
Sen. Ron Wyden (D-OR)

But Barack Obama does not care either. His budget was presented last week and has zero chance of advancing with good reason.  Obama’s Budget Hikes Taxes by $1.6 Trillion   In his budget, Obama also proposes that over the next 10 years, tax cuts of $349 billion be accompanied by tax increases of $1.9 trillion, for a net 10-year tax increase of $1.6 trillion. 

The president’s budget would repeal, let expire or limit:

  • the Lifetime Learning Credit;
  • the student loan interest deduction (for new borrowers);
  • Coverdell accounts; and
  • 529 education savings plans.

The president’s budget would:

  • triple the maximum Child and Dependent Care Tax Credit (CDCTC);
  • expand the American Opportunity Tax Credit;
  • create an auto-enroll IRA for workers without an employer-based retirement plans (with an option to opt out);
  • create a new second earner credit of up to $500 for families where both spouses work; and
  • expand the Earned Income Tax Credit (EITC) for workers without children and for non-custodial parents.

The president’s budget would raise taxes in many ways. For example, it would:

  • increase the capital gains and dividend tax rate to 28 percent (inclusive of the net investment income tax);
  • end stepped-up basis by treating bequests and gifts as realization events that would trigger tax liability for capital gains;
  • raise estate and gift taxes;
  • limit the value of itemized deductions to 28 percent;
  • create an additional alternative minimum tax designed to ensure certain high income taxpayer pay at least 30 percent of income —after charitable contributions—in taxes;
  • impose a 19 percent on the foreign earnings of U.S. companies;
  • raise tobacco taxes; and
  • impose a tax on the debt of financial institutions.

In addition, Obama’s budget increases the corporate welfare provided through the tax code, with substantially higher subsidies for alternative energy and politically favored infrastructure.

The budget does contain a constructive provision that would permanently extend section 179 expensing allowing small business to deduct up to $1 million of capital expenses.