UK Muslim Brotherhood, Cross/Double-Cross

China to lay off five to six million workers

Hank Paulson: China needs to let ‘failing companies fail’

Former U.S. Treasury Secretary Henry Paulson, who oversaw bank bailouts during the global financial crisis, has different advice for China: Let companies fail.

“They can show right now they’re very serious about dealing with inefficient state-owned enterprises as they take capacity out of the steel industry, coal industry and others by letting some failing companies fail,” Paulson, who was Treasury secretary from 2006-2009, told CNBC’s Squawk Box on the sidelines of an Institute of International Finance event organized in conjunction with the G20 meeting in Shanghai.

As Treasury secretary, Paulson oversaw a $700 billion government-funded bailout of U.S. financial institutions that were seen as “too big to fail” in the global financial crisis.

Paulson, who is also a former chairman and CEO of Goldman Sachs, added that China needed to move faster to promote competition.

“Competition is about opening up to the private sector, which is the future, and it’s about putting the state-owned enterprises on a level playing field,” said Paulson,, who earlier this decade founded the independent think tank Paulson Institute promoting sustainable and environmental projects. “There’s clearly room to move faster.”

Last year, China issued guidance on reforming often-inefficient state enterprises, such as introducing mixed public-private ownership as well as pushing for mergers and share sales, but the market isn’t always certain of progress on this front.

Exclusive: China to lay off five to six million workers, earmarks at least $23 billion

Reuters: China aims to lay off 5-6 million state workers over the next two to three years as part of efforts to curb industrial overcapacity and pollution, two reliable sources said, Beijing’s boldest retrenchment program in almost two decades.

China’s leadership, obsessed with maintaining stability and making sure redundancies do not lead to unrest, will spend nearly 150 billion yuan ($23 billion) to cover layoffs in just the coal and steel sectors in the next 2-3 years.

The overall figure is likely to rise as closures spread to other industries and even more funding will be required to handle the debt left behind by “zombie” state firms.

The term refers to companies that have shut down some of their operations but keep staff on their rolls since local governments are worried about the social and economic impact of bankruptcies and unemployment.

Shutting down “zombie firms” has been identified as one of the government’s priorities this year, with China’s Premier Li Keqiang promising in December that they would soon “go under the knife”..

The government plans to lay off five million workers in industries suffering from a supply glut, one source with ties to the leadership said.

A second source with leadership ties put the number of layoffs at six million. Both sources requested anonymity because they were not authorized to speak to media about the politically sensitive subject for fear of sparking social unrest.

The ministry of industry did not immediately respond when asked for comment on the reports.

The hugely inefficient state sector employed around 37 million people in 2013 and accounts for about 40 percent of the country’s industrial output and nearly half of its bank lending.

It is China’s most significant nationwide retrenchment since the restructuring of state-owned enterprises from 1998 to 2003 led to around 28 million redundancies and cost the central government about 73.1 billion yuan ($11.2 billion) in resettlement funds.

On Monday, Yin Weimin, the minister for human resources and social security, said China expects to lay off 1.8 million workers in the coal and steel industries, but he did not give a timeframe.

China aims to cut capacity gluts in as many as seven sectors, including cement, glassmaking and shipbuilding, but the oversupplied solar power industry is likely to be spared any large-scale restructuring because it still has growth potential, the first source said.

DEBT OVERHANG

The government has already drawn up plans to cut as much as 150 million tonnes of crude steel capacity and 500 million tonnes of surplus coal production in the next three to five years.

It has earmarked 100 billion yuan in central government funds to deal directly with the layoffs from steel and coal over the next two years, vice-industry minister Feng Fei said last week.

The Ministry of Finance said in January it would also collect 46 billion yuan from surcharges on coal-fired power over the coming three years in order to resettle workers. In addition, an assortment of local government matching funds will also be made available.

However, the funds currently being offered will do little to resolve the problems of debts held by zombie firms, which could overwhelm local banks if they are not handled correctly.

“They have proposed this dedicated fund only to pay the workers, but there is no money for the bad debts, and if the bad debts are too big the banks will have problems and there will be panic,” said Xu Zhongbo, head of Beijing Metal Consulting, who advises Chinese steel mills.

Factories shut down would have to repay bank loans to avoid saddling state banks with a mountain of non-performing loans, the sources said. “Triangular debt”, or money owed by firms to other enterprises, would also have to be resolved, they added.

Although China has promised to help local banks transfer the bad debts of zombie steel mills to asset management firms, local governments are not expected to gain access to the worker lay-off funds until the zombie firms have actually been shut down and debt issues settled.

($1 = 6.5476 Chinese yuan)

The Court Telling Texas NO on Barring Refugees

Federal Court Declines to Bar the Resettlement of

Syrian Refugees in Texas

02/26/2016

FAS: In a decision issued on February 8, 2016, a federal district court denied the State of Texas’s request that the federal

government and a private refugee relief organization be temporarily barred from resettling Syrian refugees within the

state pending resolution of Texas’s challenge to such resettlement. Texas had filed this suit in December 2015, after

terrorist attacks in Paris, France and San Bernardino, California, perpetrated by persons with ties or allegiance to the

Islamic State, due to concerns that terrorists could enter the United States through the refugee resettlement program.

The court’s decision focused on the standards that plaintiffs must meet to obtain a preliminary injunction, discussed

below. However, in so doing, the court construed language in Section 412 of the Immigration and Nationality Act

(INA) requiring the federal government to “consult regularly … with State and local governments” about refugee

placement. The court’s reading of this provision could have implications for certain congressional proposals to give

states greater control over refugee resettlement.

Overview of the Court’s Decision

The court denied the preliminary injunction, in part, because it found that Texas had failed to establish a substantial

threat of irreparable injury if the federal government and the private refugee relief organization were allowed to resettle

Syrian refugees in Texas. Such a showing is required for a preliminary injunction, along with a showing that (A) the

party seeking the injunction has a substantial likelihood of success on the merits; (B) the alleged injury, if the injunction

is denied, outweighs any harm that would result if the injunction is granted; and (C) the grant of an injunction will not

disserve the public interest.

In finding that Texas failed to meet its burden of showing irreparable injury, the court noted that the evidence produced

by Texas showed only that “Syrian refugees pose some risk.” Texas did not, in the court’s view, demonstrate that

terrorists have infiltrated the refugee program, or that the particular individuals whose settlement Texas sought to block

are refugees “intent on causing harm.” It thus found the evidence “insufficient” to establish a substantial risk of

irreparable injury. The court similarly rejected Texas’s argument that it was irreparably harmed because the defendants’

failure to provide Texas with detailed information about any refugees settled in Texas deprived Texas of an alleged

statutory right to foreknowledge” of refugees’ backgrounds that had been created by INA §412’s requirement that

federal agencies consult with state and local governments about refugee placement. The court further found that a

clause in Texas’s contract with the relief organization, which purported to establish a presumption of irreparable harm

if the organization were to breach the contract was immaterial, since the clause is not binding on the court and does not,

in itself, justify the “extraordinary relief” of a preliminary injunction.

The court also found that Texas was unlikely to succeed on the merits of its challenge to the refugee resettlement plans

because “it has no viable cause of action” against the federal government. Texas’s argument here had been based, in

part, on its view that the federal government’s actions in resettling refugees in Texas run afoul of INA § 412, which, in

relevant part, provides that federal officials:

shall consult regularly (not less often than quarterly) with State and local government and private nonprofit

voluntary agencies concerning the [refugee] sponsorship process and the intended distribution of refugees among

the States and localities before their placement in those States and localities.

In particular, Texas took the view that this provision, along with the terms of its contract with private relief

organization, required it to receive detailed demographic, medical, security, and other information about individual

refugees before they are resettled in Texas.

The court did not reach the merits of this argument, instead finding that Texas cannot sue to enforce INA § 412 because

this provision does not create a private right of action. The court based this conclusion on Supreme Court precedents

finding that private rights of action to enforce federal law must be created by Congress, and the “judicial task is to

interpret the statute Congress passed to determine whether it displays an intent to create” such a right. In INA § 412,

the court found no such intent since the provisions of this section do not “confer any rights directly on the States.”

Instead, they are framed as a “general … command to a federal agency” to federal officials to consult with their state

counterparts. Such general prohibitions or commands have been seen as insufficient to create private rights of action in

other cases.

Implications of the Court’s Decision

The court’s finding that INA § 412 does not create a private right of action could have implications for certain proposals

in the 114th Congress to give states and localities greater input in the refugee resettlement process. Many proposed bills

would expressly authorize state officials to decline the resettlement of particular refugees within their jurisdictions, a

power which they lack under current law, as discussed in an earlier Sidebar posting. However, some bills take a

different approach and instead require that the federal government give state and local officials certain notices before

placing refugees within their jurisdiction. If Congress wants to ensure that states and localities can enforce such notice

requirements, it may wish to draft the latter type of measures in such a way that the statute can be seen as conferring

rights directly on the states and local governments, rather than imposing general commands on federal agencies. Only if

measures are so drafted would states and localities potentially be able to enforce the notice requirements (and even then

other limits on the federal courts’ jurisdiction could apply, such as the mootness doctrine, if for example, the refugees

are already settled within the state).

 

Pentagon’s Plan to Close Gitmo

Read it and permission granted to shake your head.

DOD Releases Plan to Close GTMO

02/23/2016

FAS: Conceding that “the politics of this are tough,” President Obama announced this morning the release of the Department

of Defense (DoD) plan to close the prison facility at the U.S. Naval Station, Guantanamo Bay, Cuba. The document

reiterates current procedures for transferring detainees to their home countries or other countries abroad, but perhaps

more controversially, promises to “work with Congress to relocate [certain detainees] from the Guantanamo Bay

detention facility to a secure detention facility in the United States, while continuing to identify other non-U.S.

dispositions.” The plan does not specify a particular location within the United States where detainees would be housed

(although it states 13 possible sites have been identified), but emphasizes the Attorney General’s 2014 conclusion that

relocation to the United States would not risk ascribing to transferees additional rights under the U.S. Constitution or

immigration laws. (This analysis, required by section 1039 of the National Defense Authorization Act for FY 2014, is

attached as an appendix to the plan).

Predicting that the closure of the detention facility will save between $140 million and $180 million over FY 2015

operating costs, the plan lays out how the Administration hopes to resolve the disposition of the 91 detainees remaining

at Guantanamo Bay. The U.S. Government, it says, is pursuing three lines of effort:

1. identifying transfer opportunities for detainees designated for transfer;

2. continuing to review the threat posed by those detainees who are not currently eligible for transfer and who are

not currently facing military commission charges; and

3. continuing with ongoing military commissions prosecutions and, for those detainees who remain designated for

continued law of war detention, identifying individualized dispositions where available, including military

commission prosecution, transfer to third countries, foreign prosecutions or, should Congress lift the ban on

transfers to the United States, transfer to the United States for prosecution in Article III courts and to serve

sentences.

The plan acknowledges that current law prohibits the transfer of detainees into the United States. Current legislative

barriers to the transfer of Guantanamo detainees to the United States include two provisions in the 2016 NDAA (P.L.

114-92). Like previous provisions in national defense authorization and appropriations legislation (beginning with

section 14103 of the 2009 Supplemental Appropriations Act (P.L. 111-32)) section 1031 of the 2016 NDAA prohibits

the use of funds for transfer or release of individuals detained at United States Naval Station, Guantanamo Bay, Cuba,

to the United States. This prohibition expires on December 31, 2016. Section 1032, also reiterating prohibitions from

previous years, prohibits until December 31, 2016, the use of funds to construct or modify facilities in the United States

to house detainees transferred from Guantanamo Bay.

These provisions are also carried over in the 2016 Consolidated Appropriations Act (Omnibus) (P.L. 114-113), Division

B, Title V (Commerce, Justice and Science) sections 527 and 528, and Division C, Title VIII (Department of Defense)

sections 8103-8104, except that the prohibitions cover funds appropriated in “this or any other Act.” The transfer

provision is repeated in Division F, Title V (Homeland Security) section 532. Title IV, section 412 of Division J

(Military Construction and Veterans Affairs) repeats the prohibition on building modifications or construction in the

United States to house Guantanamo detainees. Title VI of Division M (Intelligence) repeats the prohibitions with

respect to the Intelligence Community.

The plan appears to be a response to a 2016 NDAA provision that directed DOD to submit a comprehensive detention

strategy, which included such elements as an assessment of possible detention sites within the United States. Some

have criticized the DoD plan as failing to address sufficiently the required elements of the report. Additionally,

although nothing in the DoD plan suggests that the White House is considering using an executive order to bypass the

statutory restrictions and transfer detainees into the United States, it has been suggested that the President has

constitutional authority to close the detention facility despite legislative prohibitions currently in force. Others,

however, disagree, and the Joint Chiefs of Staff have denied in a recent letter to certain Members of Congress that there

is any intent to take actions contrary to statutory restrictions.

 

 

Hillary’s Libya Interim Govt Failed Security Standards

The civil war in Libya was raging as Hillary had some clandestine team stitch together some interim players to later become the Transitional National Council to run the country’s government. Conditions were do bad that Ambassador Stevens was hours from bailing out of the country 17 months before his ultimate death.

This speaks to conditions that were not only known to the State Department, but to AFRICOM as well and yet no boosts in security personnel was authorized all for the sake of showing control of diplomatic objectives and a light footprint. AFRICOM, more than once offered elevated security and military assistance to State for Libya, yet it was denied by State.

Ambassador killed in Benghazi attack considered leaving Libya in April 2011, emails reveal

FNC: Seventeen months before he was killed in the Sept. 11, 2012 attack on the U.S. Consulate in Benghazi, Libya, Ambassador Chris Stevens was seriously considering leaving the country as its civil war widened.

The ambassador’s concerns are reflected in emails sent to then-Secretary of State Hillary Clinton’s inner circle. The emails were released by the State Department Monday as part of the 14th and final batch of messages from Clinton’s private server.

One email in particular, dated April 10, 2011, relays Stevens’ safety concerns to the State Department. It was sent by a State Department official named Timmy Davis to several key Clinton aides, including Jake Sullivan, now the top foreign policy adviser on Clinton’s presidential campaign, and Huma Abedin.

The message, with the subject line “Stevens update” reads, in part, “The situation in Ajdabiyah [a town approximately 90 miles southeast of Benghazi] has worsened to the point where Stevens is considering departure from Benghazi. The envoy’s delegation is currently doing a phased checkout (paying the hotel bills, moving some comms to the boat, etc) … He will wait 2-3 more hours, then revisit the decision on departure.”

The message from Davis indicates there is heavy sniper fire and shelling in Ajdabiyah. According to the message, Stevens is apparently trying to see if “this is an irreversible situation. Departure would send a significant political signal” that the U.S. had lost confidence in Libya’s Transitional National Council, which oversaw the rebel forces fighting to overthrow dictator Muammar Qaddafi.

Davis’ message was forwarded to Clinton by Abedin. The secretary of state’s response is not known.

The latest email release also indicates that State Department official Wendy Sherman sent at least one classified email to Clinton in August 2012. The email, which Sherman sent with the attached message, “I don’t usually forward emails such as below”, dealt with Egyptian troop movements.

Sherman, who left the State Department this past October, led the U.S. delegation at last summer’s nuclear talks with Iran. Fox News previously reported that Sherman appears in a 2013 State Department video saying that in the interest of speed, Clinton and her aides shared information that “would never be on an unclassified system” normally.

Another revelation in the latest email dump is that Sen. Richard Blumenthal, D-Conn., urged Clinton to approve the showing of Usama bin Laden’s death photos to members of Congress after the Al Qaeda leader was killed by Navy SEALs in May 2011.

In an email to Clinton, Blumenthal argued that the photos would provide a boost to President Obama’s political capital ahead of that summer’s lengthy debt ceiling fight with the Republican-controlled House of Representatives.

“Having the members file through [a special secure room] will provide testimony to the President’s feat,” Blumenthal wrote in the May 5, 2011 message. “They will be not only be acknowledging but also enhancing his power. They will in effect become liegemen bowing before him, but not in any way they will resent or will protest. They will serve as witnesses to the magnitude of what he has done.”

Members of Senate and House committees who deal with intelligence and military matters were later invited to view the photos, but they have not been made public.

State Department spokesman John Kirby told reporters Monday that one additional email between Clinton and Obama was withheld from the final batch of messages, bringing the total number of such messages to 19.

Kirby also said that 52,000 pages of emails, not 55,000 as previously stated, have been released to the public from Clinton’s private server, which was kept in her bathroom in her Chappaqua, N.Y. home. Kirby said 55,000 was a “colloquial” term used previously by the State Department and the real number of pages is between 52 or 53,000.