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To: lurqer who wrote (13768)3/1/2003 4:39:04 PM
From: stockman_scott  Respond to of 89467
 
ALL BUSINESS: Hints of Rising Inflation Spur Stagflation Worries

By Rachel Beck
AP Business Writer
Saturday March 1, 3:49 pm ET

NEW YORK (AP) -- No sooner did hints of rising inflation emerge then the muttering began on Wall Street about the possible return of dreaded stagflation.
It was last seen three decades ago, when rising inflation, surging unemployment and failing growth crippled the U.S. economy.

No one would welcome its return.

It's not that the economy is faced with this grim scenario just yet. But a prolonged war, continued gains in oil prices or the economy's failure to recharge soon might make stagflation a possibility in the not-so-distant future.

In periods of stagflation, economic growth remains very weak, but inflation roars ahead -- as it normally would during times of rapid expansion.

It's a term that was coined in the 1970s after the OPEC oil embargo caused a dramatic surge in the cost of crude oil and gasoline and sent inflation soaring.

"High inflation pushed up interest rates and eroded buying power, and as a result consumer and business spending remained soft, preventing the economy from growing," said Sung Won Sohn, an economist at Wells Fargo & Co. in Minneapolis. "It was a vicious combination of factors."

Every few years, fears of returning stagflation turn up. Most recently, there was some talk of it in the spring of 1994.

This time around, a slight gain in inflationary pressures -- after months of no inflation concerns at all -- spurred some speculation about stagflation making a comeback.

Much of that was fueled by the recent surge in oil prices, which have reached levels not seen since 1990 as the United States prepares for a potential war in Iraq at a time when crude supplies are extremely tight.

There also have been price jumps in other commodities, including metals, cotton, aluminum and food products like wheat, corn and beef.

All that led to the much bigger-than-expected 1.6 percent January gain in the Labor Department's producer-price index, which tracks wholesale costs. It was the biggest monthly increase in 13 years.

Just the thought of increasing inflation added to lingering concerns over the sluggish economy.

There has been very little in the way of job growth. There are still huge numbers of new jobless claims each week, while companies take little initiative to add to their work force.

Corporate earnings remain depressed, despite improvements in productivity. Companies face higher material costs but lack any ability to raise prices. Manufacturing in many sectors has come to a halt.

Then there are consumers, who appear to be losing confidence fast. Since they've been economy's backbone through the last few, tough years, there are concerns about what will happen if they scale back their spending.

"The economy is still very weak and unemployment is not coming down," said Gary Thayer, chief economist at the St. Louis-based investment firm A.G. Edwards & Sons, Inc. "We don't want a flashback to the 1970s when people were seeing their job situation deteriorate while their earnings were getting squeezed."

The key to avoiding stagflation will be a sharp reduction in oil prices and an immediate turnaround in the economy.

There is some hope that a quick resolution in Iraq will be enough to do the trick, though some economists warn that might not solve everything. There are other factors propping up oil prices, including the impact of the Venezuelan oil strike, and the war isn't the only problem weighing on the economy.

"Geopolitical uncertainties are certainly troubling right now," said Anthony Sabino, associate professor at St. John's University's Peter J. Tobin Business School. "But people are also worried about whether they will even have a job tomorrow."

It's too soon to call stagflation a certain threat.

But it waits in the wings.
______________________________

Rachel Beck is the national business columnist for The Associated Press. Write to her at rbeck(at)ap.org

biz.yahoo.com



To: lurqer who wrote (13768)3/1/2003 5:15:27 PM
From: stockman_scott  Respond to of 89467
 
Putting Things In Perspective...

This post is full of various articles (and links) that could be significant when we try to understand how The United States may be viewed in The Middle East...

Message 18645222

btw, there's A LOT in this post I discovered and I don't agree with everything...It may trigger some good discussion though.



To: lurqer who wrote (13768)3/2/2003 10:58:24 AM
From: stockman_scott  Respond to of 89467
 
Did Saddam Hussein Gas His Own People?

Reality Checks Needed During War

by Don Sellar

Published on Saturday, March 1, 2003 by the Toronto Star

Halabja (pop. 80,000) is a small Kurdish city in northern Iraq. On Wednesday, the Star reminded readers that Saddam Hussein's Iraqi army killed 5,000 Kurds in a 1988 chemical weapons attack on Halabja near the end of a bloody, eight-year war with Iran.

The statement that Saddam was responsible for gassing the Kurds — his own people — was straightforward.

Indeed, U.S. President George W. Bush has used similar language about the disaster at Halabja in making a case for a military strike to oust Saddam.

Yet the Star also reported, in a Jan. 31 Opinion page column, that there's reason to believe the story about Saddam "gassing his own people" at Halabja may not even be true.

Curious about those contradictory reports, and prodded by Star reader Bill Hynes, the ombud decided to examine how this paper covered the Halabja story 15 years ago, when Washington was tilting toward Saddam's side in the Iran-Iraq war.

The Star's early coverage was skimpy. I found no breaking news story about the March 16, 1988 gas attack on the city.

But four days later, a Reuters News Agency dispatch (filed from Cyprus) said Kurds, fighting on the Iranian side, had managed to seize Halabja and nearby villages "where Iran has accused Iraq of using chemical weapons against Kurds."

Two days later, Reuters reported, Iran was alleging that 5,000 Kurds were killed by chemical bombs dropped on Halabja by the Iraqi Air Force.

Iranian officials put injured Iraqi civilians on display to back up their charges. An Iranian doctor said mustard gas and "some agent causing long-term damage" had been deployed.

Burn victim Ahmad Karim, 58, a street vendor from Halabja, told a reporter: "We saw the (Iraqi) planes come and use chemical bombs. I smelled something like insecticide."

Two weeks later, the fog of war over Halabja thickened a little when the Star ran a Reuters story saying a United Nations team had examined Iraqi and Iranian civilians who had been victims of mustard gas and nerve gas.

"But the two-man team did not say how or by whom the weapons had been used," the Reuters story said.

It explained that Iraq and Iran were accusing each other of using poison gas in violation of the 1925 Geneva Protocol against chemical weapons.

In September, 1988, the Star quoted an unnamed U.N. official as saying the Security Council chose to condemn the use of gas in the Iran-Iraq war rather than finger Iraq, generally believed to have lost the war with Iran.

The same story said Iraq's claims that Iran also had used chemical weapons "have not been verified."

Buried in that story by freelancer Trevor Rowe was an intriguing piece of information. Rowe reported the Iraqi forces had attacked Halabja when it "was occupied by Iranian troops. Five thousand Kurdish civilians were reportedly killed."

Let's fast-forward to Jan. 31 of this year, when The New York Times published an opinion piece by Stephen C. Pelletiere, the CIA's senior political analyst on Iraq during the 1980s.

In the article, Pelletiere said the only thing known for certain was that "Kurds were bombarded with poison gas that day at Halabja. We cannot say with any certainty that Iraqi chemical weapons killed the Kurds."

Pelletiere said the gassing occurred during a battle between Iraqis and Iranians.

"Iraq used chemical weapons to try to kill Iranians who had seized the town ... The Kurdish civilians who died had the misfortune to be caught up in that exchange. But they were not Iraq's main target," he wrote.

The former CIA official revealed that immediately after the battle the U.S. Defense Intelligence Agency investigated and produced a classified report that said it was Iranian gas that killed the Kurds.

Both sides used gas at Halabja, Pelletiere suggested.

"The condition of the dead Kurds' bodies however, indicated they had been killed with a blood agent — that is, a cyanide-based gas — which Iran was known to use. The Iraqis, who are thought to have used mustard gas in the battle, are not known to have possessed blood agents at the time."

"A War Crime Or an Act of War?" was the way The Times' headline writer neatly summed up Pelletiere's argument.

No doubt, Saddam has mistreated Kurds during his rule. But it's misleading to say, so simply and without context, that he killed his own people by gassing 5,000 Kurds at Halabja.

The fog of war that enveloped the battle at Halabja in 1988 never really lifted. With a new war threatening in Iraq, it's coming back stronger than ever.

Journalists risking their lives to cover an American-led attack on Iraq would face many obvious obstacles in trying to get at the truth.

In light of that, editors need to consider assigning staff back home to do reality checks on claims and counter-claims made in the fog of war.

As our retrospective on the Halabja story suggests, the bang-bang coverage — gripping though it may be — may not be enough to get the job done.

Don Sellar is the Toronto Star's ombudsman.

Copyright 1996-2003. Toronto Star Newspapers Limited

commondreams.org



To: lurqer who wrote (13768)3/2/2003 11:13:26 AM
From: stockman_scott  Read Replies (1) | Respond to of 89467
 
Where's the real support for this war...?

Turkey: No Plan for Vote on U.S. Troops
1 hour, 10 minutes ago...3/2/03
SELCAN HACAOGLU, Associated Press Writer

ANKARA, Turkey - Turkey's ruling party has no plans in the "foreseeable future" to seek another parliament vote for the deployment of U.S. troops on Turkish soil for a war with Iraq, a party leader said Sunday.

The announcement by Eyup Fatsa, deputy head of the Justice and Development party, came a day after the legislature dealt a serious blow to U.S. war planning by failing to approve a motion to deploy U.S. soldiers, weapons and equipment.

"The proposal has been delayed to an open-ended time. There is no proposal for the foreseeable future," he told reporters after a party meeting to decide whether to resubmit the motion.

Lawmakers on Saturday voted 264-250 in favor of stationing U.S. troops but that was three votes shy of a constitutionally mandated simple majority. There were 19 abstentions.

That technicality raised the question of a second vote — a stunned Washington had said it was awaiting "clarification" from Turkey, a close U.S. ally and the sole NATO member neighboring Iraq, and parliament said it would take up the issue Tuesday.

The Justice party said the Tuesday discussion would not happen, though party leader Recep Tayyip Erdogan said top party members and the Cabinet, which usually meets Wednesdays, would "evaluate" the issue.

He played down the divisions in his government over deployment. "By our party not taking a group decision on this critical issue, we carried out democracy within the party," Erdogan said.

Washington for weeks had pressured Turkey to allow the deployment, aimed at giving the U.S. military a northern front against Iraq in the event of war.

But, by an overwhelming margin, Turks oppose a U.S.-led war on Iraq — including many lawmakers of the Islamic-rooted Justice party who voted down the motion. The party holds 362 of the 550 seats in parliament.

Prime Minister Abdullah Gul was meeting Sunday with the head of Turkey's influential military, Gen. Hilmi Ozkok.

Earlier Sunday, he said parliament's failure to approve the deployment should not jeopardize ties with Washington and warned Iraq not to try to take advantage of the vote.

"Relations between Turkey and the United States are strategic. We will continue these relations with mutual friendship and mutual understanding. These (relations) shouldn't be bound to a motion," Gul said earlier Sunday.

"If (Iraqi leaders) understand this wrong and take advantage of it ... they make it hard for peace to exist. No one should misunderstand this decision by parliament," Gul added.

But the failed vote is likely to strain relations with the Bush administration. Ships carrying U.S. tanks have been waiting off Turkey's coast for deployment, and the U.S. military has hundreds of trucks of military equipment ready to unload at the southern Turkish port of Iskenderun.

"We had certainly hoped for a favorable decision," U.S. Ambassador Robert Pearson said after the vote. "We will wait for further information and advice from the government of Turkey about how we should proceed."

The White House withheld official comment, but officials said privately that the administration remains convinced it ultimately will get its way.

The motion would have empowered the Turkish government to authorize the basing of up to 62,000 U.S. troops, 255 warplanes and 65 helicopters. In exchange, Washington promised $15 billion in loans and grants to cushion the Turkish economy from the impact of war. That money may now be lost.

Turkey also risks losing Washington's support which was crucial in securing billions in loans from the International Monetary Fund that rescued the country during an economic crisis in 2001. The United States has also pushed Turkey's candidacy in the European Union and is the main supplier of arms.

If Ankara does not agree to host U.S. forces, it also loses a say in the future of neighboring Iraq if there is a war. That is a critical issue for Turkey, which fears a war could lead Kurds in northern Iraq to declare an independent state and in turn inspire Turkey's own Kurdish minority.

But the governing party's failure to approve the deployment was a reflection of the overwhelming opposition in Turkey to a war in neighboring Iraq. Tens of thousands of Turks held anti-war demonstrations while lawmakers discussed the motion. Many Turks fear retaliatory attacks from Baghdad.

"Parliament has said peace," the daily Yeni Safak headlined.

story.news.yahoo.com