Turkish Forum

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  • PKK Party Congress Sets Long-Term Strategy Based on Threat Perceptions

    PKK Party Congress Sets Long-Term Strategy Based on Threat Perceptions

    Terrorosm Monitor
    Volume 6, Issue 20 (October 24, 2008)

    PKK Party Congress Sets Long-Term Strategy Based on Threat Perceptions

    By Nihat Ali Özcan, Saban Kardas

    The Kurdistan Workers’ Party (Partiya Karkeren Kurdistan – PKK) was established in 1973 against the background of Cold War politics. In the formation of the PKK’s institutional culture and practices, the prevailing Marxist ideas and strategies adopted by other leftist movements of the time played a major role in their ideology. Influenced by the experiences of various Marxist organizations around the world, the PKK’s organizational structure was based on three pillars: a party organization acting as the ideological center and running the movement according to strict hierarchical rules, a military wing to carry out subversive military activities, and a “front” organization to oversee the activities of all PKK supporters in both legal and extralegal domains. Even after the Cold War came to an end, the PKK maintained its adherence to these institutional practices and behavioral habits. In this essay, we will evaluate one of the deep-seated practices of the PKK, party congresses. In particular, we will examine the PKK’s threat perceptions as reflected in the conclusions of the tenth party congress, held on August 21-30 in shelters in the mountainous terrain of northern Iraq. We will also discuss the PKK’s response to these challenges in the context of recent developments.

    The Role of Congresses in the PKK’s history

    The PKK has sought to project itself as more than a mere armed organization terrorizing a local population to reach some short-term goals. On the contrary, it defines itself as a party advocating a well-established political program through the application of a long-term strategy. To preserve this image, the PKK went to great lengths to hold party congresses even under dire circumstances. PKK congresses have served as a platform for evaluating the organization’s performance during previous years, assessing the existing situation and setting the agenda of the organization for subsequent years. So far, the PKK has held ten congresses. Although the organization has sought to hold its congresses approximately every five years, in some cases it convened extraordinary meetings. Since it had its first congress in Turkey in 1978, the PKK has convened two congresses in Lebanon, four in Syria and the latest three in northern Iraq.

    Prior to the actual PKK congresses, militants conduct preliminary meetings in their respective regions to determine the agenda of the convention, as well as select the delegates who will attend. The ceremonial value attached to them aside, the congresses perform three main functions. First, in addition to reaffirming the loyalty of the delegates to the imprisoned leader, Abdullah Ocalan, they help incoming members of the organization’s leadership cadres solidify their legitimacy. Second, members of the PKK assess the organization’s past activities, as well as the state of political and military conditions prevailing in the region and discuss new strategic goals and alternative instruments for future activities. These deliberations are conducted under the influence of a dogmatic attachment to Marxist principles. Third, by utilizing the milieu of the conferences, the PKK seeks to foster a sense of motivation among the members while boosting their morale.

    The conduct of delegates at congresses helps sustain the internal legitimacy of leadership cadres in several ways. Abdullah Ocalan has been the unchallenged and unquestioned leader of the PKK in all these gatherings. Over time, he has come to assume a symbolic role as the unifying element of the entire movement, and as such a “personality cult” was created around his name. According to the established practice in congresses, the members of the organization, except for Ocalan, engage in self-criticism before their comrades; they reflect on their past mistakes and acknowledge their weaknesses in fulfilling their duties. In essence, these almost ritualistic acts serve to shake the reliability of the leading figures of the PKK other than Ocalan before other delegates. As a result, through the discussions as well as ceremonies during the sessions, the congresses not only legitimize the leadership cadres but also ensure the continuation of the organization’s loyalty to the leader.

    Another function of the congresses is their role in providing a platform for analyzing the past, present and future conditions of the organization in line with its ideological disposition. In general, despite the drastic changes in world politics, the PKK’s discourse is still heavily influenced by Marxist thinking. For instance, it is commonplace to hear criticisms of capitalism in congresses. Similarly, the members of the organization seek to demonstrate their comprehension of Ocalan’s teachings through bombastic flattery of their leader. The rulings concerning the future direction of the organization are also framed in line with its ideological discourse. Therefore, decisions taken at congresses have strategic value for the evolution of the organization. The PKK publishes the conclusions of congresses in print or on the internet to communicate its goals to the public. [1]

    Lastly, congresses help motivate members of the organization. The proceedings of congresses contain short, clear and effective slogans to mobilize members. Following congresses, militants accelerate their attacks to demonstrate their loyalty to the organization and their determination to carry out the conclusions.

    Of the ten congresses the PKK has held so far, the following stand out in particular: The third congress held in 1982 called for the return of the PKK militants from Lebanon to Turkey to initiate an armed struggle against the state. The fifth congress in 1995 prioritized the political struggle over the armed struggle. The eighth congress of 1999 decided to cease terror attacks following Ocalan’s capture and the ninth congress of 2005 agreed to halt attacks against Turkish security forces. Such decisions have marked important turning points in the PKK’s overall strategy.

    Decisions of the Tenth Congress, August 2008

    The PKK convened its latest congress in northern Iraq on August 21-30. Delegates met in mountain shelters under the threat of airstrikes from Turkish jetfighters. In the traditional spirit of the congresses, the latest gathering declared the forthcoming period as “Freedom to Ocalan.” The tenth congress also maintained the tradition of assessing the past, present and future of the organization. The statements following the congress indicate one of the biggest current sources of concern is the new situation created by the meeting between Turkish Prime Minister Recep Tayyip Erdogan and U.S. President George Bush in November 2007. [2] After this meeting, the United States started to share actionable intelligence with Turkey, with alarming results for the PKK. The closing statement of the congress maintains that the United States, along with Turkey and Iran, is determined to eliminate the PKK.

    The PKK’s major concern appears to be the decision of the Barzani-led Kurdistan Regional Government (KRG) to reconsider its relations with the PKK, which may result in it abandoning the PKK (Firat Haber Ajansi, September 8). If the KRG indeed withdraws its support from the PKK, this development will likely have a grave impact on the organization’s use of the terrain of northern Iraq as a safe haven. So far the PKK’s activities in this region have been largely unhindered, which at times has led the Turkish government to accuse the KRG of actively supporting the PKK. Nonetheless, the PKK is uneasy about prospects for U.S. pressure on Barzani as well as a possible rapprochement between Turkey and Barzani (Referans, October 14). To forestall such scenarios, the PKK congress expresses its support for Barzani on the Kirkuk question (Firat News Agency, September 8).

    The conclusions of the congress also indicate that the PKK is concerned about the fate of its “front” organization (Firat News Agency, September 8). PKK supporters established various associations and political parties in the legal domain to advocate for Kurdish nationalism and compete in Turkish electoral politics. Since entering the legal political sphere in the 1980s, Kurdish nationalists have operated a series of political parties such as the Democratic Party (DEP) and the Democratic People’s Party (DEHAP), a new entity arising each time the last manifestation was shut down by the state. The most recent of these is the Democratic Society Party (Demokratik Toplum Partisi – DTP), founded in 2005. These groups nonetheless maintained organic ties with the PKK, steadfastly refusing to condemn PKK violence. The legal advocates of ethnic nationalism benefited from the violence as fear became an important factor in mobilizing people around their agenda. Continued connections or support for the PKK eventually led the Turkish state to close down many of these organizations. Despite continued protestations from DTP leaders that they do not act as a front for the PKK, the party has recently faced court proceedings designed to shut it down. At a recent meeting with three leading DTP MP’s, Deputy Prime Minister Dengir Mir Mehmet Firat (himself of Kurdish origin) told the MP’s, “We know your reality. The type of relations you have with the PKK are an obstacle for the prime minister’s efforts to implement solutions to the problem. We want you to recognize the PKK as a terrorist organization” (Hurriyet, October 19).

    As a matter of fact, the threat to the PKK’s front organizations was unwittingly aggravated by its decision to refrain from attacking civilians following the 9/11 terror attacks in order to cultivate a more sympathetic image (Ozgur Politika, March 14, 2002). Having lost the leverage of being able to “penalize” civilians, the PKK encountered serious problems in disciplining its front organizations. The most common problems were encountered in mobilizing people for street demonstrations or providing logistical support for armed militants (Firat News Agency, September 18). Having been freed from fear of punishment, the priorities of sympathizers changed during the calm years between 2001 and 2005. They started to ignore the demands of the organization. To avoid this handicap, the PKK set up more militant shadow organizations (such as the Freedom Hawks of Kurdistan) and sought to motivate its supporters and terrorize its opponents. In some cases, the PKK executed civilians on charges of being government agents (hezaciwanan.com, August 11, 2004). The conclusions of the tenth congress show that the PKK is eager to regain the leverage of punishment, threatening cadres that have failed to conform to the organization’s ideology (Firat News Agency, September 18).

    The final statement of the congress, as well as ensuing developments, show that the PKK perceives another serious threat to its front organization: the growing power of the governing Justice and Development Party (Adalet ve Kalkınma Partisi -AKP) in the region as the March 2009 municipal elections approach (Milliyet, October 21). Current predictions indicate that the DTP, which currently controls municipalities in several cities such as Diyarbakir, will face a serious challenge from the AKP. Losing municipalities may cost the PKK dearly; even if its front organization avoids a total collapse, it will still face a severe crisis. Maintaining control over local municipalities is crucial, not only because they provide material resources to the organization and boost its supporters’ morale, but also because a political presence helps build the legitimacy of the movement domestically and internationally.

    A parallel development further disturbed the PKK. The new Turkish Chief of Staff Ilker Basbug, unlike his predecessors, has sought to establish channels of communication with local people in southeastern Turkey. Moreover, Basbug has drawn attention to the economic and social problems in the region. Perceiving this outreach as a threat to its interests, the PKK threatened those people who attended a meeting Basbug held with the representatives of various NGOs in Diyarbakir. [3]

    Threats to Survival

    In short, the PKK seems to perceive threats to its survival both inside Turkey and in northern Iraq. Its assessment of current threats – namely, the prospect that the PKK may lose its safe havens in northern Iraq and the challenges posed by upcoming municipal elections and other local developments to its front organization – led the delegates attending the tenth congress to focus on two alternatives: first, increasing the medium-intensity armed attacks; second, revitalizing mass public demonstrations in urban areas, marked by the visible attendance of women and children (Firat News Agency, September 18 ). Through these moves, the PKK plans to raise the tension in the run-up to the municipal elections and mobilize people along ethnic lines. It expects that if the people are confronted with the brutal face of the state, they will cast their votes based on ethnic identity. This mode of thinking largely explains the aggressive attitude the PKK has adopted lately, through intensifying its attacks on Turkish security forces and agitating Kurdish people in southeastern Turkey and the major cities in western Turkey.

    This new strategy was put into effect shortly after the congress. The number of terror incidents increased dramatically; between August 30 and October 20, around 180 attacks were reported, the most notorious being the one against the Aktutun border station on October 3, which took the lives of 17 Turkish soldiers (www.tsk.mil.tr; see also Terrorism Focus, October 21). At the same time, the PKK was successful in mobilizing civilians. To protest Prime Minister Erdogan’s trip to Diyarbakir, PKK sympathizers organized illegal demonstrations in various cities on the grounds that Ocalan was mistreated in prison, which disrupted provision of basic services in many places. DTP deputy Emine Ayna stated, “Ocalan is seen as a leader by many Kurds. If there is any physical violence toward him, this violence is directed at Kurds” (Turkish Daily News, October 23). With demonstrators threatening local businesses into shutting down their shops, the municipalities controlled by the DTP did not collect garbage and halted public transportation as part of the PKK’s protest of the AKP (kanaldhaber.com, October 20).

    Conclusion

    To counter the political and military threats from inside and outside Turkey, the PKK has initiated proactive policies in line with the conclusions of the tenth congress. If it fails to mobilize ethnic sentiments among Kurdish speaking constituents, the DTP might have to concede electoral success in the 2009 municipal elections to the AKP, which has been making political inroads in southeast Turkey. Recent developments highlight the PKK’s determination to raise tensions in Turkey to reverse this process.

    Notes:

    1. For instance, see: Abdullah Ocalan, PKK 4. Kongresine Sunulan Politik Rapor (Istanbul: Zagros Yayinlari, 1993); Abdullah Öcalan, PKK 5. Kongresine Sunulan Politik Rapor (Istanbul: Gunes Ulkesi Yayinlari, 1995); Abdullah Öcalan, PKK Olaganustu 7. Kongresine Sunulan Politik Rapor (Istanbul: Mem Yayinlari, 2000).
    2. For Murat Karayilan’s statements, see Firat News Agency, September 18.
    3. For Basbug’s meetings, see Radikal, September 5 and Terrorism Focus, September 24; for the PKK threat, see Firat Agency, September 18.

  • On Turkish Liberals

    On Turkish Liberals

    Ahmet Ergelen

    Sabrina Tavernise’s article with the title In Turkey, Bitter Feud Has Roots in History in the June 22, 2008 issue of New York Times immediately fueled the existing debate in Turkey over the country’s political future. From the whole article alone the quote from Dengir Mir Firat, the Vice-President of the ruling AKP that ‘the Turkish society has been traumatized’ by Mustafa Kemal Ataturk’s social reforms made it to the headlines, which is hardly surprising as Mr.Firat has been a front-runner in provoking discussions on the foundations of the Turkish Republic.

    On the whole the article seems to be all too quick a wrap-up of an otherwise quite ambitious title and too brief an account of things it appears to have insight into; very typical of most western media channels which don’t seem to have time for adequately analyzing the roots of socio-political phenomena outside their borders. Ms. Tavernise’s report relies heavily on the viewpoint of the ‘liberals’ of Turkey who actually belong to some of the most privileged socio-economic tiers of society themselves. Ironically she looks at the very elite of Turkey who benefits immensely from supporting unquestioningly the roles the western capitalist world would like to assign to their country. This self-righteous group of intellectuals has had the best and most direct access among their fellow citizens to the societies of the West. Many of them graduated from its universities or attended foreign private high schools in Turkey. There is a strong bond between the Western policy-makers and Turkish liberals. It is therefore hardly surprising that many reviews from the West on Turkey quote them often to vindicate their pre-formed opinions.

    Turkish liberals are convinced that the political tug-of-war is between the ‘secular’ elite of the country (i.e. the state bureaucrats and the armed forces) who has actually run the country for decades and the ‘democratic’ representatives of the ordinary people who happen to have always been conservatives across the board. Jounalists from abroad tend to accept this explanation without giving it a second thought.

    Such an effort to simplify matters and make the issue digestible to the foreign public opinion leaves a considerable part of the electorate out of the equation. After all, 53% did not vote for AKP in the July 22 elections of last year. Among the 53% were also the white-collar and middle-class tax payers, many of them women, for example, who appeared in millions in pro-republic demonstrations in the spring of 2007 against the move by the governing AKP to appoint either the prime minister himself or one of the other two leading members of the party to presidency – thus removing another leg of the checks and balances of the system. So there is more than ‘the old guard’ rhetoric to be taken into account when millions of people are alarmed by the acts of the AKP government which steer the country toward a climate reminiscent of the final dark years of the Ottoman Empire in the beginning of the 20th Century: ‘The sick man on the Bosporus’ up for grabs by the interventionist foreign capital.

    With roughly 70% of the market stocks in the hands of foreign nationals, a soaring foreign debt and very high interest rates (just under 20%) one can hardly speak of a country’s sovereignty in economic terms. While the outlook for EU membership is much more bleak than before the signing of agreements by Mr. Erdogan as the head of the AKP cabinet to start accession negotiations, the ‘Islamisation’ of society has gained momentum, making it drift further from its European objectives. Who could argue that the leading EU member states will not capitalize on this fact to use it as a pretext to block Turkey’s membership?

    What the liberals mean by AKP’s policies being too ‘rushed’ or ‘fast’ remains unclear in the article: Does it mean that they fully support the social transition towards a dogmatic way of life –starting with the schools- and fear that a large portion of the population will wake up in time to provide opposition? Whatever they think the state prosecutor’s office had no choice but to submit its indictment against AKP to the Constitutional Court on the grounds that one of the inalterable paragraphs of the constitution defining the Turkish Republic as a secular state had been violated by the AKParty. In the end the judges did convict the party of the prosecutor’s charges with an overwhelming majority vote of 10 to 1. The punishment fell short of closing the party altogether, but included withholding half of this year’s state funds allocated to it for election campaigns.

    Upon the appeal to the high court the Western spokesmen and spokeswomen had in general acted swiftly in support of AKP against the Turkish Judiciary. They did not seem to be as moved, though, by anti-democratic actions of the AKP government itself such as the labor demonstration which was crushed by violent police action in Istanbul as recently as May 1st, 2008. The divisive ‘you are either with us or against us’ philosophy of the party has also been conveniently overlooked by the media of the developed world. Party loyalty and affiliation to religious groups alone have been the qualifications sought in the appointment of almost every critical position in the state structure. An Islamic version of every interest group whether labor unions or businessmen’s association has been created as an alternative to directly support the party. Not only the Sabah group, but over half of the media force in Turkey is firmly in the hands of AKP-affiliated businesses. Most of the ‘liberal’ journalists are embedded in those channels with fat salaries. Maybe the conflict should actually be characterized as being between Turkey’s liberal elite in alliance with the West and those who stand up for the original values of the republic.

    Furthermore other critical ‘peculiarities’ about Turkish democracy remain to be reported: There is still a 10% threshold in the election system, unparalleled by any other European democracy, which not only keeps minority representation out of the parliament, but also bolsters especially the front runner with undeserved additional seats. The law on the formation of political parties also exhibits fundamental flaws such as allowing a party leadership to do away with primaries: The current MPs were all hand-picked by their leaders prior to the elections.

    Going back to Mr. Firat’s comments that the country was traumatized by the reforms of the Republic: What exactly were these reforms and why are they currently being relentlessly attacked by Turkish liberals who are the foremost beneficiaries of them? They were basically related to, but far more extensive than the modernization attempts made during the late Ottoman era. At the right time (victory over the invading armies of the West) and under the right leadership (Mustafa Kemal, a master strategist and statesman) the time was ripe to take every bold step toward equality with developed societies of the world.

    Turkish reforms took place roughly between right before the proclamation of the republic in 1923 and and the second half of the thirties before Ataturk’s death in 1938. The push for development in education contiued well into World WarII. Not necessarily overnight as the trauma theorists claim. Moreover the whole process was overseen by the elected members of the Turkish parliament.

    Thanks to them the idea of the individual as the citizen of the country was secured with equal rights and responsibilities against the law regardless of sex, race, religion or ethnic origin. Consequently the civil code brought women and men to an equal position for the first time. Women also enjoyed the right to vote in elections as well as the right to be elected to the parliament. Being in the heart of the transformation the legislation toward a comprehensive emancipation of the woman may well have caused a ‘trauma’ among those who did not want to relinquish their privileged status in society especially against the female sex which had remained inferior in the traditional Ottoman social structure for centuries!

    When the Arabic script was abandoned for Latin in 1928 there were special schools established to re-educate the adults as well as children. If the criticism is directed at people’s being rendered unable to read the holy Koran in its original Arabic, one has to ask himself what percent of the population was literate at the end of the Ottoman Centuries (roughly 7% according to Turgut Özakman, a popular playwright and researcher of Turkish history in the last century). How many of the literates could really understand the holy script when they read it? Besides, as far as Turkish was concerned, the Arabic alphabet did not support many sounds in the language. The reader had to tell from the context alone to make out the true meaning of the word. The Latin alphabet as employed by the reformists provided, on the other hand, a truly phonetic script for the language. The pros and cons of the change were weighed against each other before any action was taken.

    The reforms of the early republican era did create the favorable conditions for the emergence of a generation of educated minds who catapulted the country from the verge of oblivion to the doorstep of united Europe. If a similar climate had existed during the Ottoman years, it could have helped rejuvenate the Sultan’s state. But it did not. The founding generation of the Turkish Republic was, after all, brought up in the late Ottoman Society. Its members learned their lesson from decades of wars, lost territories and human trajedy. They had the courage to transform themselves into a modern nation deserving to stand on its own feet. In practice, the reformist steps taken were not without shortcomings or disillusionments, of course.

    The fault, then, must lie with the following generations of intellectuals who did not have their parents’ resolve to overcome these shortcomings of their regime. Instead, particularly after world War II, they chose the apparent comfort of leaning against a superpower and receiving aid in wherever there was a shortage. The latest generation of Turkey’s actual (economic) elite therefore, could not have acted any other way than live on in such convenience that is reserved for them in return for inactivity when the rest of the population is kept in the dark.

    If Ms. Tavernise had really looked into history carefully, she could have found other aspects of the Turkish experience which may have provided a more comprehensive picture of today’s events than served by her fellow liberals of Turkey.

    Ahmet Ergelen, September 2008

  • T H E R O O T O F T H E C R I S I S

    T H E R O O T O F T H E C R I S I S

    Problems and crises must be solved all the way to their roots, not superficially. Otherwise, they will recur with a vengeance. I do not see this being done in the present crisis. The two presidential candidates do not convince me that they really understand what is going on. The people who are telling us that they will solve the crisis are the representatives of the philosophy of government that is responsible for the occurrence of this crisis. They lack leadership qualities, because they watched the crisis brewing without seeing where it was going, and now that the crisis is in full bloom, their remedy is $700 Billion from the tax payers’ pocket. I think we have asked the fox to guard the chicken coop.It appears that the roots of the present economic crisis go all the way to the first years of our Republic, to the fights between Thomas Jefferson and Alexander Hamilton. They were fighting over the purpose of government, especially over economic policy. That fight has continued after them up to our day. [See:article by Thomas J. DiLorenzo titled “What Hamilton Has Wrought”] [His book “Hamilton’s Curse” will be published on Oct.21] Hamilton was an enthusiastic proponent of the corrupt British Mercantilist system, the very system the American Revolution was fought to avoid. He fought for his program of corporate welfare, protectionist tariffs, public debt, high taxation, and a central bank run by politicians and their appointees. He was the proponent of “Crony Capitalism” or a government run for the benefit of wealthy classes. Don’t we have the feeling that some one is talking about present day conditions?

    Jefferson opposed him as strongly as he could, because Hamilton’s agenda would destroy liberty and because, he, Jefferson, was taking Adam Smith’s warning against economic interventionism very seriously.

    Wile during the last two centuries, Americans talked and praised Adam Smith, in time the corrupt mercantilist system was spread in America in most aspects of our lives.

    In our elections, we the citizens vote, but the election expenses of our representatives, senators and presidents are met mostly by corporations, who then command the loyalty of these representatives , senators, and presidents to these corporations. The result of this system is that the country is run not according to the wishes of the voters, but according to the needs of the corporations. This certainly is no democracy. During the Independence War (1919-1922) a Turkish parliament opened up in Ankara and one of the first articles of a new constitution that passed was “Sovereignty belongs unconditionally to the people” . Using this way of expressing, we should say that in the United States of America “Sovereignty belongs unconditionally to the corporations”. This system can be democratized by adopting pubic funded elections, and forbidding receiving any other monies, but our Congress wouldn’t vote for it. Corporations’ money is apparently too sweet. Public-funded elections would completely change the government. The representatives, the senators, and the presidents will start acting according to the wishes of the voters.

    Hamilton wanted a big government to borrow money, to take higher taxes, and to spend freely, solely to sell government bonds to the affluent people (business people). Those who would hold these bonds would vote for him. Jefferson, to the contrary, advocated minimal government .

    Wall Street financiers liked Hamilton’s idea and became the supporters of the Federalist Party, and eventually, of the Whigs and Republicans. The bonds between Wall Street and the Federal Government were strengthened, when Wall Street got to market government bonds. Hamilton wanted to unite the propertied interests of the Eastern Seaboard into an administration party. He also transformed the financial transactions of the Treasury Department into an orgy of graft in which selected politicians participated. The political descendent of these 18th Century “propertied interests” is the $700 Billion Bailout Bill of 2008.

    Hamilton is also known as the Founding Father of Central Banking. According to William Graham Sumner, “a national bank was not essential to the work of the Federal Government.” Sumner believed that “The real purpose of Hamilton’s bank was the interweaving of the interests of wealthy men with those of the government.” The bank provided cheap credit to business supporters of the Federal Party, “attempting to engineer boom-and-bust cycles to influence elections” . It was a disaster for the general public. Once it created 72 % inflation. So the Central Bank was closed several times, but it survived. In 1913 the FED was created. “The Wall Street elite’s response to all this central-bank induced monetary instability was even more centralized banking with the creation of the Federal Reserve Board. It may have meant instability to ordinary citizens, but was the source of great riches to the banking industry and other members of the politically well-connected class. Sound familiar?”

    I said at the beginning that “Problems and crises must be solved all the way to their roots. I have defined and described the roots: it is the government itself with its Central Bank. It seems to me that the government is not going to get rid of its central bank to solve the present crisis. Thus, the crisis will last many years., while the $700 billion will enrich many people who are the makers of the crisis. The only possibility of solution will start with the adoption of public funded elections and taking the hands of corporations from the steering wheel of the government. To make sure that such a crisis does not recur, we must erase all influence of mercantilism from our economy. That would make us also freer.

    I have been in this country for 55 years and so far never heard that the Central Banks create on purpose economic cycles to influence elections, not until a few days ago, when I read the Article of Thomas J. DiLorenzo. If it is true, it would be a scandal of Gargantuan proportions. In 1958 when I was caught in one of these cycles and suffered for nine months, I was told that these cycles belong to the nature of the capitalist system. No one knew that it was created by the Central Bank, or what ever it was called at that time. Millions of Middle-class people suffered with me, and they too did not know the cause of their suffering. Why didn’t the media enlightened us? It is not possible that they did not know. How about the people we elected? Could they not know too?

    Now that the DiLorenzo article put the story in the public arena, what will the Government do? I am very curious.

  • Turkey Threatens Iraqi Kurdistan with Incursion

    Turkey Threatens Iraqi Kurdistan with Incursion

    Turkish Prime Minister Recep Tayyip Erdogan threatened Iraqi Kurdistan on Tuesday with an incursion. The threat came days after militants for the Kurdistan Workers Party (PKK) attacked Turkish troops within Turkey’s borders, kiling 17.Most PKK militants stage attacks in Turkey after which they quickly cross the border with Iraq where they hide. Northern Iraq is home to many Kurds, and the PKK has established several major training camps for future militants.

    The PKK is deemed a terrorist organization by, among others, Turkey, the United States and the European Union.

    Iraq’s central government had promised several times in the last couple of years to do something about the PKK presence in the northern part of the country, but has yet to take significant action.

    “The sole target of a possible cross-border operation will be the terrorist organisation,” Erdogan told lawmakers from his ruling party the AK Parti (or Justice and Development Party).

    “Turkey is in a position of self-defence when it comes to terrorism. Everyone should understand this,” he said. “The best choice for the regional administration of northern Iraq is to cooperate with us against terrorist elements because the terrorist organisation is a cause of regional unrest and tension.”

    Iraq and Turkey have been at odds with each other for years over this issue. Turkey believes that Baghdad is not doing enough against the PKK, forcing Turkey to do take matter into its own hands, while Baghdad says there is not much it can do because the PKK hides in regions difficult to enter for government forces, and argues that cross border operations by Turkey are unacceptable, because Turkey would not be allowed to act in breach with Iraq’s territorial integrity.

    The United States, meanwhile, is caught in the middle because it has fought a war against terrorism for quite some years itself, and has invaded two countries in order to destroy terrorist organizations (both Afghanistan and arguably Iraq). This means that it is difficult if not impossible for the U.S. to criticize Turkey when it goes into Iraq, occupies a significant part of its ‘Kurdistan’ part, and withdraws weeks, perhaps months, later.

    On the other hand, Iraq’s government is not willing to let Turkey deal with problems too big for itself to handle, and calls on Turkey to withdraw immediately whenever it takes military action against PKK target in Iraq. The U.S. has to, of course, stand with Iraq, also because more than 100,000 of its troops are stationed in this country. Furthermore, the U.S. fears that a Turkish incursion will destabilize one of the historically most stable parts of Iraq.

  • Energy Security and the PKK Threat to the Baku-Tbilisi-Ceyhan Pipeline

    Energy Security and the PKK Threat to the Baku-Tbilisi-Ceyhan Pipeline

    By Nihat Ali Özcan, Saban Kardas

    In the wake of the conflict in Georgia, the future of energy transportation from the Caspian basin and Central Asia to world markets is once again on the agenda. By looking at the attack by the Kurdistan Workers’ Party (PKK) on the Baku-Tbilisi-Ceyhan (BTC) pipeline in August, we will discuss how growing instability in the region highlights the interconnectedness for Turkey of security of energy pipelines, terrorism and regional stability.

    Given the political, military and economic implications of oil and natural gas production and transportation, one can better appreciate the search, on the part of producers, investors and consumers, for cheaper and more secure energy transportation routes. Even a seemingly technical decision over the optimal transportation lines is shaped by political competition. The rivalry is present at all stages of energy transportation including project, construction and management. Such struggles range from securing investment capital to sharing profits, providing physical security, and ensuring political stability in the countries involved.

    Today, in addition to their high economic value, energy pipelines play important roles in diplomatic, economic, military and ecological terms. In addition to offering immediate economic benefits to transit and terminal countries, pipelines may act as the building blocks of alliances and boost cooperation among states. Likewise, pipelines may shape domestic politics in countries that are increasingly dependent on imported energy for heating or power.

    One strategy that appeals to countries situated astride alternative pipeline routes is to engage in activities designed to undermine the profitability of rival existing routes and render them risky for investors. Since investors will be discouraged from financing projects in volatile and insecure regions, destabilizing rival routes by sponsoring terrorist or insurgent organizations that operate in the transit corridors is a common strategy.

    It is widely documented that terrorist groups around the world often attack energy pipelines and the personnel working there. Through acts of sabotage, bombing and kidnapping, terrorist or insurgent groups may seek to derail the construction of pipelines or the flow of oil or gas. Such attacks have occurred in many countries, including Colombia, Nigeria, Sudan, Algeria, Iraq, and Saudi Arabia. Likewise, during the last 25 years, the PKK has threatened the security of pipelines running through Turkish territory and from time to time has mounted actual attacks on them.

    Various reasons explain why pipelines are targeted by terror organizations and their sponsors. First, the direct and indirect impact of pipelines on society makes them highly valuable targets. The effects of attacks range from the interruption of heating in winter conditions to environmental disasters, fluctuations in world energy markets, and diplomatic and legal disputes over compensation. These repercussions empower terrorist organizations in terms of bargaining power and propaganda purposes. Second, because securing infrastructure is extremely difficult, the physical vulnerability of pipelines and related facilities make them easy targets. Given the availability of explosives, blowing up pipelines can be accomplished by terrorists easily, further complicating security. Third, since petroleum and natural gas can easily ignite, terrorists prefer to attack them with explosives. Despite many safeguards developed to reduce the impact of sabotage acts and resume the operation of pipelines through quick repairs, overall pipelines are still considered vulnerable targets.[1]
    The PKK and Kirkuk-Yumurtalik Pipeline.

    Turkey has two strategically important trans-border pipelines, aside from the ones serving domestic needs: Kirkuk-Yumurtalik and Baku-Tbilisi-Ceyhan. When the Nabucco pipeline project is finalized it will connect the Baku-Tbilisi-Erzurum (Turkey) and the Tabriz (Iran)-Erzurum gas pipelines to Austria, feeding extensive European gas networks (see nabucco-pipeline.com). During the deliberations over the selection of these projects, their implementation, and the administration of pipelines, multinational companies had to factor the instability caused by the PKK’s terror campaign into their calculations, making the PKK an indirect player in the game.

    Turkey completed the construction of the first strategic oil pipeline, Kirkuk-Yumurtalik, between 1978 and 1984. It was completed in 1984, the year when the center of gravity of the Iran-Iraq war shifted from the Persian Gulf to northern Iraq. Having benefited enormously from oil revenues in financing the war, Iraq negotiated with Turkey to build a parallel line. To undermine the feasibility of Kirkuk-Yumurtalik pipeline, Iran supported the Kurdish peshmerga forces in Northern Iraq and the PKK in Turkey. [2] Coincidentally, the PKK initiated its terror campaign around the same time (Hurriyet, Milliyet, Cumhuriyet, August 18, 1984).

    The PKK and the Baku-Tbilisi-Ceyhan Pipeline

    The new political geography of the Caucasus and Central Asia following the dissolution of the Soviet Union led to a power struggle between Russia, Iran and Turkey. More importantly, the growing demand for energy worldwide directed the attention of the developed countries seeking to diversify their suppliers to the vast energy resources in these regions. [3] The discussions concerning the transportation of Azerbaijan’s energy resources to the world markets brought Turkey to the forefront, agitating Iran and Russia.

    The BTC route emerged as the most efficient option for the transportation of Azeri gas and oil to the West. It was eventually expected to be expanded to carry the rest of the Caspian basin resources. Since the lynchpin of these developments was the transportation of Azeri and Caspian resources to the West in circumvention of Russian-controlled lines, preventing or delaying the BTC project was in the interests of Russia, Iran and Armenia. Russia was concerned about losing its influence in the region and being left outside the calculations concerning the Caspian region. Iran was worried that oil revenues might boost Azerbaijan’s power and increase separatist sentiments among Azeris in Iran. Armenia was naturally irked by the close relations between Azerbaijan and Turkey and by the likely increase in Azerbaijan’s power.

    The strategy of Russia, Iran and Armenia was based on portraying the BTC corridor as risky and unstable. Through acts of omission and commission they contributed to this perception in the 1990s. Armenia’s conflict with Azerbaijan in 1993 and its invasion and ongoing occupation of Nagorno-Karabakh played a role in perpetuating instability in the Caucasus. Russia’s support for Armenia and meddling in the domestic affairs of Azerbaijan and Georgia in 1992-1993 prompted instability in these countries. The escalating PKK violence inside Turkey raised questions about the safety of the transportation corridor, further delaying the project.

    During the debates on the Baku-Ceyhan pipeline, the Turkish Armed Forces (TSK – Turk Silahli Kuvvetleri) came close to eliminating the PKK through a cross-border operation in northern Iraq in September 1992. The PKK had to relocate to camps in Zeli in northern Iraq, far from the Turkish border. The deteriorating conditions forced PKK leader Abdullah Ocalan to declare a unilateral ceasefire in March 1993 (Hurriyet, March 15, 1993). In May 1993, during his visit to Turkey, the Azerbaijani prime minister signed the contract for the construction of the pipeline. In the intervening period, the PKK maintained close ties with Iran and Russia. [4] On May 24, 1993, the PKK resumed violence, ambushing a military convoy on the Elazig-Bingol highway, killing 33 recruits discharged from their duties (Hurriyet, May 25, 1993). As the TSK intensified its counter-terrorism operations, the conflict escalated. Consequently, growing instability in the energy corridor forced investors to suspend the project.

    Around the same time, Russia and Iran stepped up their efforts to sell Turkey their natural gas. The Blue Stream pipeline (a trans-Black Sea natural gas pipeline supplying Russian gas to Turkey) that increasingly rendered Turkey dependent on Russian gas was initiated under these conditions.[5] Similarly, Turkey signed a contract with Iran for the construction of a pipeline to carry Iranian gas to Turkey. The resumption of the BTC project came only in the early 2000s, after Turkey expended enormous resources to capture Ocalan and bring the PKK violence under control.

    New Russian Security and Foreign Policy Doctrine

    Russian foreign and security policies in the Putin era were centered on a new doctrine that sought to channel energy revenues to the realization of Russia’s strategic priorities (Eurasianet.org, February 1, 2006). Rising energy prices after the Iraq war and the increasing demand for oil worldwide provided perfect conditions for implementing this project. The sustainability of this approach depends on the maintenance of Russia’s influence over ex-Soviet countries, and the continuation of the West’s dependence on hydrocarbons and continuing high energy prices.

    Russia’s interest in the production, marketing and transportation of oil and natural gas is particularly visible in the case of the BTC, hence in its policies as well toward Azerbaijan, Georgia and Turkey. Anxious to diversify energy supply routes and break down Russia’s dominance, the United States and the European countries have grown increasingly interested in the BTC as well as other routes through Turkey. Although, the BTC and the Baku-Tbilisi-Erzurum gas pipeline are buried underground, concerns over their security never fully disappeared. [6]

    In this context, the recent conflict in Georgia has refocused the attention to energy security in the Caucasus. Coincidentally, prior to the outbreak of hostilities in Georgia, the BTC came under attack on August 5, 2008, disrupting the oil transportation for 14 days (see Eurasia Daily Monitor, August 8). The pipeline had been pumping 850,000 to 900,000 barrels per day before the explosion. Although some 200,000 barrels per day were diverted to underused pipelines running through Russia and Georgia, the financial loss over 14 days still came to over 1 billion dollars (see U.S. Department of Energy, Energy Assurance Daily, August 8). The oil that burned, expenses for putting off the fire, personnel and repairs cost another 20 million dollars.

    These economic losses aside, the security of the BTC corridor and reliability of Turkey as an alternative supply route again came into question, as in the 1990s. During the invasion of Georgia, the Russian army did not destroy the BTC pipeline but some railways and trains used for oil transportation were destroyed. The interruption of the railways and the sabotage of the pipeline temporarily forced Azerbaijan to divert some of its crude oil through routes controlled by Russia (RFE/RL, September 2). In the wake of the Georgian crisis, Azerbaijan is wary of the idea of bypassing Russia entirely in energy transportation, as reflected by the cool reception U.S. Vice President Dick Cheney received during his September 3 visit to urge Baku to commit to pipeline routes that would avoid Russian territory. [7]

    In the coming days, the debate on energy security and alternative energy corridors is likely to intensify. If Turkey cannot counter economically and politically costly attacks on pipelines in its territory and prevent instability in the surrounding regions, it will face enormous consequences. Not willing to incur billion dollar losses in every attack, multilateral corporations might explore alternative routes, and seek compromise with the PKK to cease its attacks on the pipelines. As a country aspiring to become a major transportation hub connecting Middle Eastern and Caspian hydrocarbon reserves to Europe, Turkey will come under pressure to ensure security at home and in its neighborhood. Through its diplomatic initiatives, such as the proposal for a Caucasus Stability and Cooperation Platform, it has sought to stabilize relations in the Caucasus region (Today’s Zaman, August 19). Likewise, it has to restore the credibility of its territory as a secure route, especially given its plans to push for the Nabucco pipeline and discussions on the integration of trans-Caspian pipelines into the BTC.

    Turkey’s ambitions will paradoxically make it a target of the actors seeking to discredit the routes stretching through Turkey. As long as Turkish territory remains one of the main theaters of battle over energy transportation, the interest in the PKK either from Turkey’s regional competitors or from the West will not cease. The motivations that led the PKK to sabotage the BTC in August are unclear. In any case, this move shows that the PKK closely follows regional developments and is in search of new roles and potential supporters. By targeting the BTC pipeline, the PKK might have been attempting to find new strategic partners. There are grounds to be concerned that the PKK may be receiving limited international support, though as of yet no definitive evidence is available. This sabotage was the PKK’s first attack on the BTC; interestingly, it came on the eve of the crisis in the Caucasus. As the attack broke with the movement’s long-standing caution in avoiding alienating Europe and the United States, it is possible the PKK may have received guarantees from other potential sponsors. Given Russia’s record of limited support for the PKK in the past (such as harboring PKK leader Abdullah Ocalan), the August 5 PKK attack on the BTC pipeline may have to be analyzed within the context of broader debates on the future of energy transportation in the region and Russia’s attempts to solidify its dominant position as the major supplier of Caspian and Central Asian energy reserves.

    Notes:

    1. See “Threats to Oil Transport,” Institute for the Analysis of Global Security, n.d., ; “Terrorism and Oil Make Volatile Mix,” Pipeline & Gas Journal, May 2006, pp.32-33. .

    2. Nihat Ali Ozcan, PKK (Kurdistan Isci Partisi) Tarihi, Ideolojisi ve Yontemi, Ankar, ASAM Yayinlari, 1999, pp.222-237.

    3. A. Necdet Pamir, Baku-Ceyhan Boru Hatti, Ankara: ASAM Yayinlari, 1999.

    4. For PKK-CIS relations, see reports submitted to the 5th Congress of the PKK, Vol. 2, Damascus, 1995, pp.569-586; on PKK-Iran relations, see pp.553-567.

    5. Firat Gazel, Mavi Akim, Istanbul: Metis Yayinlari, 2003).

    6. For an account of the motivations of regional actors to destabilize the BTC, see: Gal Luft, “Baku-Tbilisi-Ceyhan Pipeline: Not Yet Finished and already Threatened,” Energy Security, November 4, 2004 .

    7. Mete Goknel, “Kafkas Krizinin Ardindan Enerji Kaynaklari Konusundaki Gelismeler,” September 11, 2008, .

  • Financial Insight : POOR RICHARD’S REPORT

    Financial Insight : POOR RICHARD’S REPORT

    Richard De Graff [[email protected]]
    860-522-7171
    800-821-6665-watts
    860-315-7413- *
    860-208-0258Cell
     
    I SMELL A RAT!
     
                I would like to start this letter with an explanation of my disclaimer. I receive information from various sources that over the years have a ninety five percent rate of accuracy. Some I pay a handsome fee for and they in turn carry a hefty fine for plagiarism, so I rephrase parts in my own style. In times of crisis it would be very difficult and time consuming to sue when the information is for the public good. The statements I make are well founded on over 48 years of experience.
                For the past 2 ½ years I have been warning about this stock market. We are in a major long term bear market that can have tremendous rallies only to fall to new lows. If you have not figured that out yet – then you never will. My prayers go out to you.
                Instead of searching out whom to blame, I am going to write about how to improve the system. We are the largest economy in the world. One would have to combine the next five largest economies just to equal ours. We should be preaching love and kindness and setting higher standards of trusting ethics.  Don’t laugh, I believe it can be done, but first we must rein in the greedy choirmasters.
              The President of the United States receives a base salary of $400,000 per year. It is a lousy job, but the greatest retirement, the problem is getting there.
                Members of Congress receive $169,300 per year. After serving one term when they reach retirement age they will receive full pay. I wish I could do that. Then I wondered why they run so hard to get reelected? It suddenly dawned on me- the lobbyists. What do these politicians do with all that money?  They keep a lot of it. Especially if they are not wealthy to begin with. I can just see those republicans waiting to come into power in the early 1990’s, with their mouths drooling with greed. They were not too smart handling those slush funds, as many went to jail.
                The first matter of business is to have the lobbyist publically report exactly how much money they spend on everything- just like a public corporation. Failure to do so would be 5 years of jail with no parole and return of family properties to the IRS. Once their wife, kids, and home are involved they should become squeaky clean. Then we will only have to worry about the ones that are single.
                The next important change on my priority list is to bring back the UPTICK Rule for short sales. Usually, we dream of buying stocks at a low price and selling them high for a nice profit. Well, a short sale is the opposite. One sells first and hopefully buys back at a lower price. First one must find a stock to deliver to the buyer when he sells. If the firm cannot find shares to deliver to the buyer – then they cannot have a trade. Next, and this is very important before the stock can be sold short – the stock must trade up from the previous trade. That is called an uptick. Joseph Kennedy, the first SEC chairman instituted this rule and brought instant calmness to the market place. Since this rule has been rescinded in July 2007 the market has been subject to all kinds of abuses and the volatility, in my opinion, is a result of this. John McCain is right in asking for the removal of SEC Chairman Cox.
                Since rule breakers in Washington are dealing with public funds that affect our families, we must also pass punishment on their families too. That would sure clean up Washington real fast, or we might find a spate of divorces.
                So what has the administration been doing? They are banning shorts sales in 700 odd financial institutions until October 2nd!
                I smell a rat. This is a lousy band aid. Mutual Funds’ year ends September 30th so you have seen a lot of short covering. When you buy a stock all you can lose is what you paid for it. If you sell short, first you are on margin and your losses are unlimited. Traders who want to squeeze the short sellers can just keep buying until the last short stock has been covered. (That means the short seller has found a seller who will deliver a stock certificate so that he can deliver it back to the one he borrowed it from. So the upside is unlimited as far as losses are concerned, versus your profit being limited once the security you shorted goes to zero.) This writer has never sold short and there were many occasions I should have, but that is making money off someone else’s misery- sometimes mine.
              Here is the scary part.
                Well, certain powerful global corporations thought they could do anything. There are greedy guys breaking the cardinal rules of honest finance and breaking the backs of honest investors; some of whom will never return to the market place. The investment pool is evaporating and these big “fishes” lack the water to swim in.
                The central bankers, like an expert fisherman, gave them all the line they wanted and then yank! Pow! Oh the pain of being reeled in. Imagine the pain they have caused upon the poor trusting consumers.
                Moral #1:
                Central Bankers make good money. Chairman Bernanke makes $212,000 per year.  That makes him the second highest paid official in the US Government. Among central bankers he is one of the lowest paid officials.
              Moral#2:
              Don’t mess with your central bank- he holds all the cards!
     
                                                   Addendum
    While the empty talking heads on TV are spouting off in all directions, they are missing the point.
    Listen to this Mr. Cox, to stop 90% of the greed, bring back the uptick rule and the markets will calm down the minute you sign the order. Maybe Dr. Bernanke should do it and Congress would abolish Cox’s job.
    (Most of the Washington politicians I know are dead and buried, but valued reader, if you know some – send this letter.)
                Future letters will dwell on how to improve the investment environment while curtailing the abuses going on today. With instant communications available today, we must devise new checks and balances to protect the ordinary investor.
                The Investment Act of 1940 should be revisited. There are provisions there that are antique by today’s standards. Their size brings corporate power to their management instead of the shareholders.  
                Management should be paid on corporate performance. Corporate earnings decline, management salaries should drop by the same percentage.
                These are just a few ideas and I will go into more detail in future letters.
    Thank You.
               
    This report has been prepared from original sources and data we believe reliable but we make no representation to its accuracy or completeness. Coburn & Meredith Inc its subsidiaries and or officers may6 from time to time acquire, hold, sell a position discussed in this publications, and we may act as principal for our own account or as agent for both the buyer and seller.
     
    This is my new Home/Office number in Eastford Ct. I can be reached any where from 8:30am to 8:00pm a cell phone can not be used for transmitting orders.  The cell phone is always on my person, but like me has to be recharged every night.