Davos: Europe’s Social Breakdown, Begins with Immigration

And all the signals are beginning to apply to the United States….fair warning.

Davos/World Economic Forum

Davos Boss Warns Refugee Crisis Could Be Precursor to Something Much Bigger

Bloomberg: As the crash in commodities prices spreads economic woe across the developing world, Europe could face a wave of migration that will eclipse today’s refugee crisis, says Klaus Schwab, executive chairman of the World Economic Forum.

“Look how many countries in Africa, for example, depend on the income from oil exports,”Schwab said in an interview ahead of the WEF’s 46th annual meeting, in the Swiss resort of Davos. “Now imagine 1 billion inhabitants, imagine they all move north.”

Whereas much of the discussion about commodities has focused on the economic and market impact, Schwab said he’s concerned that it will also spur “a substantial social breakdown.”

That fits into what Schwab, the founder of the WEF, calls the time of “unexpected consequences” we now live in. In the modern era, it’s harder for policy makers to know the impact of their actions, which has led to “erosion of trust in decision makers.”

“First, we have to look at the root causes of this,” Schwab said. “The normal citizen today is overwhelmed by the complexity and rapidity of what’s happening, not only in the political world but also the technological field.”

That sense of dislocation has fueled the rise of radical political leaders who tap into a rich vein of anger and xenophobia. For reason to prevail, Schwab said, “we have to re-establish a sense that we all are in the same boat.”

The theme for this year’s meeting is the Fourth Industrial Revolution, which the WEF defines as a “fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.”

While that presents huge opportunities, Schwab warns that technological innovation may result in the loss of 20 million jobs in the coming years. Those job cuts risk “hollowing out the middle class,” Schwab said, “a pillar of our democracies.”

At the same time, Schwab argues, trends like the sharing economy and the changes wrought by technology mean economists must adapt the tools they use to assess well-being. “Many of our traditional measurements do not work anymore,” he said.

After decades watching the ebbs and flows of the global economy, Schwab said the current anxiety is “not new” for him. But he said that as the world gets ever more interconnected, the consequences of such turmoil could become more grave. This week’s WEF meeting, he said, will offer policy makers “the first opportunity after the markets have come down to look at the situation and coordinate.”

Davos facts for this year:

CNNMoney: Around 2,500 participants from more than 100 countries, including 40 heads of state, attend the gathering in Switzerland, formally known as the World Economic Forum annual meeting. This year, the theme is “Mastering the Fourth Industrial Revolution.”

It takes place in the mountains. Way up. At 1,560 meters (5,120 feet) above sea level, Davos is Europe’s highest town. Its population is just over 11,000 and the average temperature in January is -5°C/23°F.

Why in such a remote, cold place? Tradition. Also, it’s much easier to secure a little town wedged between the mountains than a conference center in a big city — remember, 40 heads of states are coming.

Only once was the meeting held outside of Davos: In 2002, in New York, as a gesture of solidarity after the 9/11 terrorist attacks.

Davos is safe. The organizers don’t release specific information, but it is estimated that around 5,000 Swiss troops, police and security personnel guard the town.

Davos is pricey. The ticket is around $20,000 and that’s just the tip of the iceberg. Travel can cost thousands, and a night in a medium-range hotel is around $600. Add to it wining, dining, and essential accessories like snow boots, and the total bill can add up to around $40,000.

Davos is green. The town’s CO2 levels fall on average up to 30% during the annual meeting, thanks to controls on vehicle emissions and the use of electric transport.

Besides the skiing, what’s it all about? Meetings. Hundreds of them. With major companies, countries and media represented, there is hardly a better opportunity to schmooze and make deals. But the forum is not about big public announcements. Meetings are informal and take place behind closed doors.

Who is coming this year? Nearly everyone who matters in the world of business. Bill Gates will be there, as will Mary Barra, Satya Nadella, Jack Ma, Eric Schmidt, Sheryl Sandberg and dozens of other CEOs.

The IMF chief Christine Lagarde will be in Davos, with ECB President Mario Draghi and the governors of 10 national central banks.

The U.S. will be represented by Joe Biden and John Kerry. Loretta Lynch, the U.S. Attorney General, is also coming, as is Penny Pritzker, the Secretary of Commerce.

The King and Queen of Jordan will be there, as will Bono, Leonardo DiCaprio, Yao Chen and will.i.am.

They’ll all be closely followed by around 250 journalists, including a posse from CNN.

And the no-shows? Neither Barack Obama nor Vladimir Putin are coming to Switzerland. German Chancellor Angela Merkel is also sitting it out this year.

Eric Holder has Teamed up with Hillary

via GIPHY   (Hat tip, Weekly Standard)

This could also tell us that Holder is working deeply with the Clinton campaign on all her legal issues that include the server and the foundation….wow, no doubt eh?

Eric Holder: ‘Progressive’ Hillary Best to ‘Protect Obama Legacy’

She’s an “agent of change.”

TruthRevolt: Anyone who watched Sunday evening’s Democrat debate, or who has followed presidential contender Hillary Clinton’s rhetoric of late, knows she has been doing an inordinate amount of pandering to Obama voters.

Full of praise for the Obama administration, its policies and initiatives, Clinton is beginning to sound like an Obama’s greatest cheerleader. While on its face it seems the former First Lady is simply looking to garner the support of Obama disciples, according to Attorney General Eric Holder, who recently endorsed the Democrat frontrunner, Clinton is actually the best candidate to uphold Obama’s legacy.

In fact, Holder thinks the former Secretary of State is just as “progressive” as socialist Sen. Bernie Sanders. He also said that black voters can’t afford to allow “wistfulness” at the closer of Obama’s presidency keep them from the polls. During an interview with The Washington Post on Sunday Holder discussed why Clinton is the best candidate to “continue the great work that President Obama and his administration did.”

When asked what he would say to black voters who are not as excited about the candidates this time around, Holder explained why Clinton will “protect the Obama legacy” and that she is an “agent of change.”:

“I think what people have to understand is that what we have to do is protect the Obama legacy. We’ve made really substantial progress in the last eight years — it’ll be eight years at the end of 2016 — and the question is who is best situated to protect that legacy and not let the progress that we have made get rolled back. And there is no question that there are going to be attempts to roll back the Affordable Care Act, they sent [President Obama] a bill the week before last that he had to veto. There will certainly be efforts to counter the executive actions that he’s taken on immigration issues, when it comes to gun safety issues and his foreign policy.

“You need somebody who’s got a record on those issues that’s consistent with the positions that the president took, and Hillary Clinton is that person, there’s no question. They are in lockstep when it comes to gun safety issues. Sen. [Bernie] Sanders, quite frankly, is not. So to the extent that people are a bit of a nostalgic, wistful feeling, I think that ought to be converted into a concern for the future and for the preservation of all the great work that President Obama and his administration did.”

Some voters don’t think Clinton, compared to Sen. Bernie Sanders, is progressive enough.

“People have not, for whatever reason, focused on the fact that Hillary Clinton is and always has been a change agent. If you look at her record as a progressive and think about what she did early in her career at Children’s Defense Fund. We can talk about here in South Carolina where she worked to make sure that kids were not incarcerated, jailed with adults. Health care — Hillary Clinton led the fight for health care during the Bill Clinton administration. Although the overall effort wasn’t successful, the CHIP program came out of that effort.

Holder told the Post that, from his perspective, people are confused about who Clinton is as a political figure.

“There’s no question in my mind that she is a progressive,” he said.

And there’s no question in our minds either, Holder.

Germany: Migrant Rape Crisis Calls for Military

German finance minister calls for option to deploy troops in wake of Cologne attacks

In light of the New Year attacks in Cologne, German Finance Minister Wolfgang Schäuble has demanded the option of deploying Bundeswehr troops at home. He also reiterated his support for Chancellor Angela Merkel.

In an interview with Saturday’s edition of the “Süddeutsche Zeitung,” Schäuble said Berlin must ask itself why “under clear legal rules in support of the police, practically every other country in Europe can turn to its armed forces,” except for Germany.

“A legal basis for domestic military missions must be created,” Schäuble told the paper, adding that Germans expect the state to ensure security.

“For this you need more police and enhanced legal foundations for the police and intelligence services,” he said.

“The situation may arise, however, where both federal and state police forces are exhausted,” he added. “Every other country in the world would deploy soldiers in an emergency.”

Any deployment of the Bundeswehr within Germany is subject to extremely strict constitutional limitations, with its role described in the German Basic Law as absolutely defensive.

Refugee debate

The finance minister’s comments came amid ongoing uproar in Germany over reports of scores of sexual assaults in Cologne at the city’s New Year’s Eve celebrations.

Witnesses at the city’s main train station and iconic cathedral described women being groped, as well as subjected to lewd insults and robbery. In one instance, a rape was reported. Most of the culprits were said to have been of a North African or Middle Eastern appearance.

Support for Merkel

The reports have also renewed criticism of Chancellor Angela Merkel’s open-door policy on refugees and migrants, with some 1.1 million new asylum seekers registered in the last year alone. Following criticism from within Merkel’s own Christian Democrats (CDU), Schäuble renewed his support for the chancellor.

“I support with conviction what the chancellor has said: We must solve the problem at the external borders,” Schäuble told the “Süddeutsche.”

Like Merkel, Schäuble called for a solution to the refugee crisis by means of better controls and cooperation with neighboring countries, adding that action in Europe was “still too slow.”

‘No one satisfied’

The finance minister also warned his fellow CDU party members against criticizing Merkel’s refugee policy.

“Of course, no one is satisfied with the situation,” Schäuble said, admitting that there had been “very intensive discussions” within the CDU and its Bavarian sister party, the Christian Social Union. The people want us “to solve the problems the best we can,” he said.

Schäuble’s comments published Saturday were far from comparable to those heard at the end of last year when he called for a strict limit on the number of family reunifications among refugees and compared Germany’s unprecedented influx of asylum seekers to an “avalanche.”

Obama Lifting 14 Red Notices, Part of Iran Deal, Good for Assad

Prisoner Swap May Help Iran Arm Assad

Bloomberg: In exchange for the release of four American prisoners, the Barack Obama administration agreed to free seven Iranians in U.S. custody and stop trying to arrest 14 others, two of whom the U.S. government had accused of  funneling weapons to the Bashar al-Assad regime and Hezbollah in Syria.

For years, Iran’s privately-owned Mahan Air has been using its planes to bring soldiers and arms directly to the Syrian military and the Lebanese terrorist group Hezbollah by flying them from Tehran to Damascus, according to the U.S. Treasury Department. In 2013, Treasury sanctioned Mahan’s managing director, Hamid Arabnejad, for overseeing the company’s efforts to evade U.S. and international sanctions and aiding the Iranian Revolutionary Guards Corps’ elite Quds Force.

“Arabnejad has a close working relationship with IRGC-QF personnel and coordinates Mahan Air’s support and services to the paramilitary group,” the Treasury Department said. “He has also been instrumental in facilitating the shipment of illicit cargo to Syria on Mahan Air aircraft.”

According to the Iranian state media organization FARS, Arabnejad is one of the 14 Iranians who no longer will have Interpol red notices out on them, which are meant to ensure their arrest and extradition to the U.S. on charges that will now also be dropped. The executive order he is sanctioned under is for support for terrorism. In 2011, the U.S. sanctioned the entire airline for ferrying personnel and arms for the Revolutionary Guards Corps and Hezbollah, which it officially considers a terrorist organization. The White House declined my request for comment on whether Arabnejad was among the de-listed Iranians, but did not dispute the 14 names on the FARS list.

Mahan Air is “yet another facet of the IRGC’s extensive infiltration of Iran’s commercial sector to facilitate its support for terrorism,” the Treasury’s under secretary for terrorism and financial intelligence, David Cohen, told Bloomberg News at the time.

2012 press release from the Treasury says, “Iran used Iran Air and Mahan Air flights between Tehran and Damascus to send military and crowd control equipment to the Syrian regime.” Hezbollah and the Assad government coordinate with Mahan Air during their attacks on Syrian civilians and opposition groups, the Treasury Department said.

According to the Iranian news service, another Iranian who will no longer have to look over his shoulder when traveling around the world is Gholamreza Mahmoudi, also a top official at Manar Air. When Treasury sanctioned Mahmoudi in 2012, it said he worked closely with Arabnejad to evade sanctions and purchase new aircraft.

Last May, as the Iranian nuclear deal was being finalized, Mahan Air was able to purchase nine used Airbus commercial airliners, taking advantage of a relaxation of sanctions that came with an interim agreement Iran struck with Western powers. Experts say that the new lifting of the Interpol “red notices” — essentially arrest warrants — on Arabnejad and Mahmoudi further reduces pressure on Mahan Air and, by extension, on the Assad regime and Hezbollah, even though their U.S. Treasury Department sanctions remain in place.

“The one big impediment for them to run their business abroad was the red notice, not the U.S. sanctions,” said Emanuele Ottolenghi, a senior fellow at the Foundation for Defense of Democracies, a Washington think tank that has advocated tough sanctions on Iran. “Clearly it was not impossible for them to travel. The fact they are no longer on the red notice means that as long as they don’t try to come to the U.S., they will probably live their professional lives unencumbered.”

The lifting of the red notices also has a symbolic effect, he said, by telling countries and companies around the world that it’s OK to look the other way as Mahan Air helps the Assad regime and Hezbollah.

“These guys have been working day in and day out flying arms to Assad regime,” said Ottolenghi. “This is another signal that there will be no consequences for this airline and the crimes they are responsible for.”

A U.S. official told me Saturday that the U.S.  removed any Interpol red notices and dismissed any charges against 14 Iranians for whom it was assessed that extradition requests were unlikely to be successful.

President Obama spoke about the Iran prisoner swap Sunday and said none of the 7 released Iranians were charged with terrorism or any violent offenses. “They are civilians,” he said. But Obama didn’t mention the 14 who no longer have international arrest warrants, including the Mahan Air executives.

“We remain steadfast in opposing Iran’s destabilizing behavior elsewhere, including its threats against Israel and our gulf partners, and its support for violent proxies in places like Syria and Yemen,” Obama said.

The administration has repeatedly said that the Iran nuclear deal and the prisoner swap were separate events, pursued through parallel tracks of diplomacy. But there’s concern on Capitol Hill that the effort to stop the Revolutionary Guards Corps’ violent activities is suffering in the wake of the nuclear agreement.

“This flawed deal is only entrenching Iran’s military and security forces that run the country.  Now more than ever, we need a policy of backbone, not backing down,” House Foreign Affairs Committee chairman Ed Royce said Saturday.

On the other hand, Treasury did go forward Sunday with sanctions on Iran’s ballistic missile program that had been delayed because of the prisoner negotiations.

The return of the American prisoners, including Washington Post reporter Jason Rezaian, is of course good news, and the Obama administration believes the costs of the trade were worth the benefits. But some of those costs could be felt by the Syrian people, who had no say in the trade, got nothing from it and are still begging for more international support to stop Assad’s slaughter of civilians.

*** Going back to 2007, there were clandestine flights from Caracas, Damascus and Tehran.

NYT’s CARACAS, Venezuela, March 2 — Iran is already Venezuela’s closest ally outside Latin America, with ventures to produce oil and build cars and tractors together. Now, travelers between the countries can also take a weekly flight between Caracas and Tehran.

The flight, which was inaugurated here on Friday and includes a stop in Damascus, Syria, is operated in a code-share agreement by the Venezuelan state-controlled airline Conviasa and Iran’s national carrier, Iran Air.

Officials at Conviasa said that the company would use a Boeing 747 on the route and that soon it would also make available a European-made Airbus 340.

Under President Hugo Chávez, Venezuela has tightened relations with Iran and expressed explicit support for its uranium enrichment program.

Mr. Chávez has also reached out to Syria, making plans to build a $1.5 billion oil refining complex there. He sees relations with Iran and Syria, both under United States sanctions, as a centerpiece of a foreign policy aimed at countering American influence around the world.

In 2010:

Mahan Air made its first flight to Kuala Lumpur International Airport (KLIA) today (January 28).

Iran’s second largest airline is offering twice weekly flights from Shiraz to Kuala Lumpur, using an Airbus A310-300, which has a seating capacity of 196.

*** Let us not forget that in circa 2000: In the hotel room of Yazid Sufaat, a former Malaysian Army captain and businessman, in a hotel in Kuala Lumpur. The meeting lasted from 5 January 2000 to 8 January 2000. The summit’s purpose was allegedly to plan future attacks, which apparently included the October 2000 bombing of the USS Cole and the 11 September 2001 attack plot. The attendance consisted of Arab veterans of the Soviet war in Afghanistan, including Hambali, Ramzi bin al-Shibh, Nawaf al-Hazmi, Khalid al-Mihdhar, and Tawfiq bin Attash.

And in March of 2015:

KUALA LUMPUR – Malaysian police have foiled an attempt by a terror cell of the Islamic State in Iraq and Syria (ISIS) to attack the Saudi Arabia and Qatar embassies in Kuala Lumpur with the arrest of two Iraqi nationals.

Sources said the two men were detained by intelligence officials at a shopping mall last Thursday.

“They were planning to attack the embassies on March 31 at the behest of IS,” a source told The Star last Saturday, using another name of ISIS.

Iran Implementation Day and Iran’s Connection to Islamic State

The money to Iran is already moving.

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This is going to be a long read, but an important one such that history is included, details of diplomacy is included and described implications are described. Imagine what the next president of the United States will have to deal with, but more, imagine what Iran may do in the immediate coming months with $100 billion dollars, which by the way is bigger than Iran’s current economic value.

Iran Is More Deeply Tied to ISIS Than You Think

As the West continues to partner with Iran to “degrade and ultimately destroy” the Islamic State, it is worth remembering that one of Iran’s highest-ranking terrorists was instrumental in founding Al-Qaeda, and that the split between Shia and Sunni jihadis is murky at best.

Iranian operative Imad Mughniyeh was instrumental in the training, development, and support of Hezbollah, Hamas, and al-Qaeda – and thus its offshoot, the Islamic State.

The power vacuum Mughniyeh created helped to further Iran’s geopolitical agenda. (This is a very long, detailed and important read, don’t miss the whole summary)

In part from the WSJ: The head of the Treasury Department’s Office of Terrorism and Financial Intelligence is in Europe to discuss joint counterterrorism finance efforts and where things stand with the global agreement on Iran’s nuclear program. Talks on the former will be straightforward enough, but the latter could get bumpy.

Over the past few months, investors from Europe and Asia have gone to Tehran in droves, searching for post-sanction deals and bolstering Iranian hopes that the lifting of international sanctions will draw significant investment. Some in Europe have described Iran “as ‘an El Dorado’ and potential ‘bonanza.’ ” The chief of Iran’s central bank has cited the country’s “unique geographical advantage,” its “sense of timeliness and discipline,” and “very good history of being a trade partner.” In October, he predicted that “Iran will be a very favored destination for many international investors.”

But Treasury officials bear mixed news: The U.S. is preparing to meet its commitments on sanctions relief tied to implementation of the nuclear deal. Still, many U.S. sanctions tied to Iran’s support for terrorism, human rights abuses, and other negative behaviors remain in place.

And within days of the Iranian central banker’s comments in October, the Financial Action Task Force, which sets global standards on countering money laundering and terrorist financing, issued another searing rebuke of Iran’s “strategic deficiencies.” Only Iran and North Korea, the task force said, present such “on-going and substantial money laundering and terrorist financing” risks that the international community should apply active “counter-measures” to protect the global financial system.

The task force said that as sanctions are being lifted under the nuclear agreement, it “remains particularly and exceptionally concerned about Iran’s failure to address the risk of terrorist financing and the serious threat this poses to the integrity of the international financial system.” It repeated its long-standing call for financial institutions to “give special attention to business relationships and transactions with Iran, including Iranian companies and financial institutions.” The full story is here.

From the White House:

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From the Treasury Department in part:

Implementation Day Statement:

On July 14, 2015, the P5+1 (China, France, Germany, Russia, the United Kingdom, and the United States), the European Union, and Iran reached a Joint Comprehensive Plan of Action (JCPOA) to ensure that Iran’s nuclear program will be exclusively peaceful.  October 18, 2015 marked Adoption Day of the JCPOA, the date on which the JCPOA came into effect and participants began taking steps necessary to implement their JCPOA commitments.  Today, January 16, 2016, marks Implementation Day of the JCPOA.  On this historic day, the International Atomic Energy Agency (IAEA) has verified that Iran has implemented its key nuclear-related measures described in the JCPOA, and the Secretary State has confirmed the IAEA’s verification.  As a result of Iran verifiably meeting its nuclear commitments, the United States is today lifting nuclear-related sanctions on Iran, as described in the JCPOA.
In connection with reaching Implementation Day, today the Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued several documents.  Specifically, OFAC posted to its website: Guidance Relating to the Lifting of Certain Sanctions Pursuant to the Joint Comprehensive Plan of Action on Implementation Day; Frequently Asked Questions Relating to the Lifting of Certain U.S. Sanctions Under the Joint Comprehensive Plan of Action (JCPOA) on Implementation Day; General License H: Authorizing Certain Transactions relating to Foreign Entities Owned or Controlled by a United States Person; and a Statement of Licensing Policy for Activities Related to the Export or Re-Export to Iran of Commercial Passenger Aircraft and Related Parts and Services. The aforementioned documents are effective today, January 16, 2015.
***

Political Challenges to the Iran Deal in Tehran and Washington

By Aniseh Bassiri Tabrizi and Timothy Stafford
The Iran deal remains at the mercy of a volatile and unpredictable political climate, both in Tehran and Washington. This could well overwhelm it in the coming year.

Ticking the Boxes: Tehran’s Road to ‘Implementation Day’

By Aniseh Bassiri Tabrizi
To make the deal successful, intensive co-ordination between domestic actors in Iran will be required to implement these highly technical processes.

The Devil is in the Detail: The Financial Risks to the Economic Success of the Iran Deal

By Emil Dall, Andrea Berger and Tom Keatinge
Over the last decade, the US and EU have constructed a complex network of sanctions in response to Iran’s nuclear programme, ensuring the near-total isolation of Iran from global markets. On ‘implementation day’, this network starts to be disassembled and reintegration begin.

Iran Implementation Day Recommendations

The signatories to the Iran nuclear deal should move to entrench processes that will enable the agreement to outlast the individuals that put it in place. By this time next year, a new US president will have been sworn in, and presidential elections in Iran will only be just months away. Time must be used wisely.