Putin’s Kremlin subverting Israeli democracy?

(THIS ARTICLE IS COURTESY OF THE TIMES OF ISRAEL)

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Is Putin’s Kremlin subverting Israeli democracy? A Russia expert thinks so

A devastating, complacency-shattering interview with Ilya Zaslavskiy, one of the world’s leading experts on Moscow’s overt and covert designs on the West

Main image by Amos Ben Gershom/GPO

WASHINGTON, United States — Despite the global headlines about Russian meddling in foreign elections, Israeli experts have thus far expressed little concern that it could happen here.

At Tel Aviv University’s CyberWeek cybersecurity conference in June, for instance, Israeli officials made light of the impact of fake news and foreign influence campaigns on Israeli society. Fake news is a “nuisance,” Eviatar Matania, head of the National Cyber Bureau in the Prime Minister’s Office, told a panel at the conference, not a major threat. Other speakers said they had seen no signs of Russian influence campaigns targeting Israel.

But the recent release by researchers at Clemenson University of three million Russian troll tweets created by Russia’s Internet Research Agency between 2012 and 2018 paints a different picture.

Reporters from Israel’s Channel 10 News found that tens of thousands of the tweets dealt with Israel and the region and some were written in Hebrew, indicating they were indeed targeting Israelis and people who care about Israel.

Ilya Zaslavskiy, a Washington, DC-based expert on Russia and head of research at the Free Russia Foundation — a nonprofit led by Russians abroad that says it “seeks to be a voice for those who can’t speak under the repression of the current Russian leadership” — told The Times of Israel that he would be extremely surprised if Russia weren’t carrying out covert influence campaigns in Israel.

“We now know for a fact that Russia has been interfering on a massive scale in US, German and UK elections and referendums,” said Zaslavskiy, who is also a member of the advisory board at the Hudson Institute’s Kleptocracy Initiative and an academy associate at Britain’s Royal Institute of International Affairs (Chatham House) think tank.

Ilya Zaslavskiy (Courtesy)

“We know that they intervened in the Catalonia referendum as well as a referendum on Ukraine in Holland. They continue to interfere in the US midterms and they have been meddling in all sorts of local elections in Eastern Europe. and the post-Soviet space,” he said. “So why wouldn’t they interfere in Israeli elections when Israel is so important to their strategic interests?”

Asked why Israel is of interest to Russia, Zaslavskiy, who is Jewish and immigrated to the United States from Russia as a young adult, said that “Israel is of strategic importance to the Kremlin  — because Israel is actually one of the forces that could contain Russia, could prevent some of the abuses that Russians are carrying out.”

He cited, for instance, developments in Syria. “Israel is not a great friend of Assad, but now the Israeli government has sort of accepted that Russians uphold him and have got a foothold in Syria,” he said. Asked how things could have been different, Zaslavskiy replied “Israel could have been more vocal and critical about Russia’s role in Syria.”

This December 11, 2017 photo shows Russian President Vladimir Putin, right, and Syrian President Bashar Assad watching troops march at the Hemeimeem air base in Syria. (Mikhail Klimentyev, Sputnik, Kremlin Pool Photo via AP)

More generally, “you could have expelled some of the Russian oligarchs, you could have prevented some of the money laundering,” he said. “You could actually impose some sanctions on Russia and limit their influence in your country.”

Why hadn’t that happened? During a deeply disconcerting interview in the US capital Zaslavskiy offered some insights. And as the conversation developed, he moved rapidly beyond election meddling to a wider, nightmare vision of an ascendant Russia, with Western democracies weakened and outflanked. Regarding Israel specifically, he described covert, Russian-led processes already unfolding that he believes are undermining the rule of law and democracy itself, and set out specific measures that he believes must urgently be taken if the decline is to be halted and contained.

An existential danger

Zaslavskiy believes that both Israel and the West face an existential danger from Russia unless the problem of covert and overt Russian influence is fully acknowledged and decisive measures are taken to combat it. He says most of the West fails to grasp the gravity of the threat, which includes not just efforts to meddle in elections but the exporting of corruption and criminality from post-Soviet countries to the West, thereby undermining democracy itself.

Russian President Vladimir Putin (R) with Israeli Prime Minister Benjamin Netanyahu during their meeting at the Kremlin in Moscow on July 11, 2018. (AFP/ Pool/Yuri Kadobnov)

In a recent report for the Hudson Institute’s Kleptocracy Initiative entitled “How Non-State Actors Export Kleptocratic Norms to the West,” Zaslavskiy argues that the West did not in fact win the Cold War and that its norms and values, like democracy and the rule of law, are very much in peril.

“When the Soviet empire collapsed in 1991, it was widely believed that Western-style democracy and liberal capitalism based on free elections, separation of powers and the rule of law would eventually take root in the Commonwealth of Independent States (CIS) and other regions emerging from the Cold War,” he writes. “Even when ex-Communist Party leaders and representatives of Soviet security services returned to power throughout the former Soviet Union (FSU) in the late 1990s to mid-2000s, mainstream political thought never once doubted the inevitability of democracy’s march across the globe. Experts debated speed and direction, but rarely questioned the ultimate destination.”

The West has largely failed to export its democratic norms and is instead witnessing an increasingly coordinated assault on its own value system

In reality, Zaslavskiy goes on, “the West has largely failed to export its democratic norms and is instead witnessing an increasingly coordinated assault on its own value system. This destructive import of corrupt practices and norms comes not only from post-Soviet kleptocratic regimes like Azerbaijan, Kazakhstan, and Russia, but also from China and other countries around the world whose ruling elites now possess far-reaching financial and political interests in the West.”

The new norms being exported to the West, which he dubs neo-Gulag norms, include the idea that those in power are the only real and rightful decision-makers and that the rest are ultimately “prison dust.”

Another such norm, he writes, is that “everything and everyone is for sale, or at least susceptible to manipulation or some form of control.” And finally, the Russian ruling elite believes that “individual human life does not matter anywhere, unless it is someone from their inner circle or equally as powerful as they are.”

The Times of Israel sat down with Zaslavskiy at a cafe in Washington, DC, to discuss the connections between Putin, Israel, organized crime, election meddling and the decline of democracy in the West.

The Times of Israel: There has been a lot of talk about Russian influence campaigns and Russian interference in elections. What aspect of this threat do you think people in the West are failing to grasp?

Ilya Zaslavskiy: They are failing to grasp two main things. First they think that the corruption, criminality and anti-democratic developments that happen in a place like Russia have very little to do with their own life or their own country. That’s the first delusion.

Today, everything is so much more integrated. When criminal groups supported by security services are allowed to do things in their own country, they immediately export their practices and values to the West, to safe havens where they can actually not only keep their money but can continue their activities.

There are many oligarchs of Jewish background from the post-Soviet space, from Russia, Kazakhstan and the Caucasus, who earned their money in a very dirty way in the 1990s and 2000s, and now they’ve moved to Israel

The second thing people fail to realize is that, unlike during the Cold War, there are open channels of business that these kleptocrats can exploit to export their norms and practices legally.

You see a lot of money from kleptocratic countries pouring into the West and paying for lawyers, lobbyists, PR people, even journalists, as well as former security people and security companies. In Soviet times this was not possible. Today, a Russian kleptocrat can continue his criminal activities in the West in broad daylight, without being prosecuted and hardly being covered by the press.

How might this be happening in Israel, and how might Israelis not be aware of it?

There are many oligarchs of Jewish background from the post-Soviet space, from Russia, Kazakhstan and the Caucasus, who earned their money in a very dirty way in the 1990s and 2000s, and now they’ve moved to Israel.

Some have Israeli citizenship and operate abroad and some operate in Israel. It’s not only that they have a luxurious lifestyle, throw fancy parties and buy amazing real estate. That’s another delusion in the West. Many Westerners believe that oligarchs bring their dirty money to their new country but merely as consumers.

In fact, they start to invest in assets — in strategic assets, in politics and in newspapers.

The vast majority of oligarchs can be hired on an ad-hoc basis by the Russian state or Kazakh state, and can be exploited for political purposes by this kleptocratic state.

I recently co-authored a report — “How to Select Russian Oligarchs for New Sanctions?” — that explains why and under what criteria the US government should add oligarchs like the Alfa Group oligarchs to sanctions.

There are very powerful figures with lots of money, lobbyists and PR support in Israel. [Prime Minister Benjamin] Netanyahu shows up at events with some of them.

Let’s say you have an oligarch who is close to Putin. What would they be doing in Israel? Why should Israelis care?

They can do multiple things. First, they can normalize Kremlin narratives about Israeli interests.

For example, the way they present Russia’s place in the Syrian conflict, in relations with enemies of Israel like Iran, or concerning the Soviet diaspora in Israel.

I’m sure they help promote Kremlin propaganda about the Second World War and Russia’s [ostensibly] almost exclusive role defeating the Nazis. And they peddle the Jewish veterans’ theme with the orange and black St. George ribbon. It’s a ribbon that commemorates the Soviet victory over Nazism that has come to be associated with Russian propaganda against Ukraine and against the West — how the West never really stood up to the Nazis, for example. These are not just historical narratives; they are very useful for today’s politics.

Above and photo at top: Prime Minister Benjamin Netanyahu (right) and Russian President Vladimir Putin (left) attend a wreath-laying ceremony at the Tomb of the Unknown Soldier in Moscow, on May 9, 2018. Both men are wearing the orange and black St. George ribbon (Amos Ben Gershom/GPO)

But the other thing oligarchs can do in Israel is to co-opt the elite, under the guise of cultural and charity events. They can throw fancy parties with caviar and beautiful women and invite politicians. They have held these receptions around Western capitals. I have followed some of these in London, as well as here in Washington.

Why would a Russian oligarch own a newspaper or TV station?

They may have financial interests and hope to make money but for many of them it is not done for commercial purposes. The reason is to support politicians through the media, and that allows you to get a foothold in the government. You do nice things for the government and then they do nice things for you in return. You establish a relationship and it’s a long-term thing.

It’s all very interconnected. The payback is not immediate but it’s a very solid investment.

Let’s say a Russian oligarch moves to Israel and starts investing in all kinds of businesses and giving money to charity. Why not just assume he’s retired?

No one from that world of state security or organized crime is off the hook because the Russian state has too much compromising material on them, as well as incentives. Also, if you don’t comply you can be eliminated. There is now a book on how Putin most likely ordered killings of dozens of people inside Russia and outside Russia who did not comply with his interests, including from his own security services or organized crime.

A file photo taken on September 14, 2004, shows Alexander Litvinenko (L), a former Russian intelligence agent, speaking at a press conference in London. (AFP PHOTO / MARTIN HAYHOW)

For example, he first used polonium not on Alexander Litvinenko but most likely on Roman Tsepov, who was part of the organized crime group in St. Petersburg in the 1990s that allegedly worked closely with Putin during his rise to power. It’s easier for anyone to comply. There are many oligarchs abroad that he uses on an ad-hoc basis. It’s switch on, switch off. It’s not too demanding or too crazy, and it’s actually acceptable to most of these people.

What’s the connection between the Russian state and organized crime?

In Soviet times there were three worlds that were distinct — with separate, even contradictory, goals. There was the Communist Party, the security services and organized crime. Organized crime was more or less antagonistic to the Soviet regime.

Organized crime and its networks have become part of the Kremlin’s political instruments abroad, including in Israel

Under Putin these three worlds collided and fused and learned from each other. Security services now oversee the businesses of organized criminal groups. Organized criminal groups carry out the political building and conduct operations for the Kremlin. The ideology of the Communist Party was thrown down the drain but the cynical and pragmatic practices, like co-opting the far right, co-opting the far left, co-opting Christianity or Judaism, remained.

You co-opt whoever is important to you in any given country. You can even contradict yourself in different countries but just divide and rule through all these channels — through ideology, through organized criminal groups, through corruption. Organized crime and its networks have become part of the Kremlin’s political instruments abroad, including in Israel.

If there were a Georgian or Russian oligarch who wanted to open hundreds of call centers throughout Israel and scam people abroad out of money, is that something that co-opting the elite would allow them to do?

Yes. But compared to corruption in Russia which involves billions for a single road or pipeline, binary options and forex are a relatively small-scale fraud. Russia as a state is also involved in hacking and dodgy cryptocurrencies; we now know that for a fact from Robert Mueller’s investigation. Russia as a state, especially its security services and associated oligarchs, are involved in all sorts of dodgy things, including in the digital realm.

Someone like Putin would not follow specific criminal activities like binary options, but he sits at the top of a pyramid and there might be levies that make their way from an Israel-based criminal enterprise all the way to the top.

Why would a Georgian or Russian criminal decide to put call centers in Israel of all places?

For a variety of reasons. Corrupt Russian money penetrates any vulnerable spot in the world. The criminality has not just penetrated Israel. It’s in Europe, in Asia, the Middle East and the US.

Why do there seem to be many Jewish oligarchs?

It’s a very useful topic to anti-Semitic circles and it’s not true. Maybe in the late 80s and 90s indeed there were a lot, perhaps too many, visible Jewish oligarchs because of the legacy of the Soviet era and tsarism. Jews had been marginalized and pushed into the black market. They traditionally had math skills, due to the way they were raised, and they helped each other, as does any minority network; ethnic minorities tend to help each other.

Under Putin, I think it’s a specific propaganda tool to expose Jewish oligarchs much more than the rest of the oligarchs. “Oligarch” is actually no longer a useful term in my view, because it suggests that they still have some power. They lost all their power to Putin. Their only currency today is loyalty, it’s not dollars.

Half of the major Jewish events that I see here in Washington, the fancy ones where you can co-opt elites, are co-sponsored by Russian oligarchs

Whatever dollars they have in their accounts can be taken away from them at a snap. Yes, they can store their money offshore but they can’t stop working for the Kremlin. Most of them still own too much in Russia and there are too many hooks and levers on them.

There is no distinction between public and private property in Russia. Everything is owned in one way or another by the Kremlin. So the money that they give as donations, very often they are asked to give the donation. And they have no choice but to give it.

Actually, the Russian state tries to present some of these oligarchs as if they are no longer with the regime, as if they are now in the West. It’s all very misleading. I could count actual Russian oligarchs who are completely removed from the Russian state with one hand.

What about Leonid Nevzlin?

Well, Nevzlin is one of the exceptions. He was ousted from Russia. Mikhail Khodorkovsky too.

I don’t like the term oligarch. I prefer the term handlers, operatives, maybe agents, rich agents. Many of them are actually front men for the money that they ostensibly have. It’s not actually considered fully their money. I’m sure they’re representing some of the Kremlin money, just under the guise of it being their money.

Just to return to your question about the Jewish oligarchs. Currently there are many rich and powerful security people around Putin. They are mostly Russian or a variety of nationalities, but they are secretive and very well protected. Some of the federal ministers as well. Most of the Russian Duma and government are millionaires. They’re just officials but they have the lifestyle of a mini-oligarch.

Should we feel sorry for the oligarchs? It sounds like they can’t escape their gilded cages.

Well some of them managed to escape and these are very exceptional, but obviously at a very high cost to themselves.

There are actually many whistleblowers and refugees from the Russian regime, some of them reformed, some of them not. London has a lot of people like that. Some of them managed to take out some money while others didn’t. They lost a lot, some involuntarily because they fell out of the system. Only few deserve any kind of empathy. Otherwise it’s a very complicated and dark world.

Why do oligarchs give so much money to Jewish and Israeli charities, especially religious ones?

It’s co-option and soft power, and they may be even be using these charities to give political donations.

For themselves, it’s reputation-laundering and legitimacy. It also allows them to advance narratives that are useful to the Kremlin — like about World War II.

If you look at the list of art galleries, museums, and all sorts of Jewish organizations, in New York, Europe and Israel that are associated with Putin’s oligarchs, you will be absolutely amazed

For instance, this whole debate about Ukraine. Russia tries to say the current government is a Nazi government, and how all of western Ukraine and their parties are anti-Semitic, how the West opened a second front in World War II at too late a stage and did not help Russia. The Kremlin can co-opt Jews to promote these narratives.

And then there are the May 9th celebrations [V-Day, commemorating the surrender of the Nazis in 1945] by Russia around the world, including in Israel on a large scale now.

Funding Jewish charities also gives them access to people. If you have a high-level event at the Metropolitan Museum or the Museum of Jewish History, you get access to politicians so you can co-opt them. If you look at the list of art galleries, museums, and all sorts of Jewish organizations, in New York, Europe and Israel that are associated with Putin’s oligarchs, you will be absolutely amazed and stunned. MOMA, the Metropolitan Museum, operas, Carnegie Hall, the Victoria and Albert Museum, the Tate Gallery. The list is endless.

Half of the major Jewish events that I see here in Washington, the fancy ones where you can co-opt elites, are co-sponsored by Russian oligarchs.

I’m sure that Russian oligarchs have managed to co-opt many politicians in Israel.

Look at [the rise in Russia of] Chabad. People in Chabad say, “We are just promoting the Jewish legacy. At least there is no anti-Semitism under Putin.” They find all sorts of excuses [to be supportive of Putin]. Before Putin, Chabad was a marginal group, at least in the former Soviet Union.

Minister of Defense Avigdor Liberman seen with Russian-Israeli World War II veterans, as they take part in the Veterans Day parade in honor of the Allies’ victory over Nazi Germany, at the Knesset. May 8, 2018. (Miriam Alster/Flash 90)

What is the Russian ruling class’s goal in Israel?

To create an environment — a political environment and economic environment — where it’s too difficult for Israel to resist some of the strategic interests of the Kremlin in the region. Not to oppose Russia’s interests.

But they’re also interested in subverting democracy. A strategic goal for the next few years is to subvert democracy in the West. In some ways they have already succeeded, and the appetite comes with food, as they say. So once they subvert democracy, the goal is to advance more corruption, more vested interests and then just turn the whole West into a corrupt world.

Why do they want to turn the West into a corrupt world?

Because then you can engage in what Russians love, which is realpolitik. Whoever is strong gets his own zone of influence and no one else can interfere. Russia would like to divide the world into zones of interest.

Look at what they did with influencing the American elections and possibly Brexit.

Russia’s President Vladimir Putin (L) and US President Donald Trump talk as they attend the Asia-Pacific Economic Cooperation (APEC) leaders’ summit in the central Vietnamese city of Danang on November 11, 2017. (AFP/Sputnik/Mikhail Klimentyev)

By the time of the 2016 elections in the United States, Russians already had all sorts of Putin understanders and supporters in the press, in the lobbying groups, in business circles, in chambers of commerce, among politicians, even in Congress. They have all these people who are associated with Russia through attending events at the Russian Embassy, going to conferences in Russia and Europe, sitting on boards of Russian companies or galleries associated with Russian money. It’s all done through open channels.

There are several think tanks in Washington which are completely subverted by Russians and that put forward narratives useful to the Kremlin about everything — from Ukraine, to Israel, to corruption. That acts as a force against an independent press, independent thinking, because you can pollute the whole policymaking and debating environment

They also influence think tanks and their debates and narratives about Russia. There are several think tanks in Washington, for example, which are completely subverted by Russians and that put forward narratives useful to the Kremlin about everything — from Ukraine, to Israel, to corruption — and that acts as a force against an independent press, independent thinking, because you can pollute the whole policymaking and debating environment.

Why does Putin want to destroy democracy? Because it competes with his patronage system?

Yes. If I had to judge, I think it’s just his enormous lust for power and he’s a control freak. He just can’t get enough. But maybe, some people suggest that his circle pressures him. I would imagine they pressure each other and it’s a constant game of power, so he has to stay afloat and show benefits.

You’ve said you think journalists are not writing enough about Putin and his oligarchs?

I see it as a huge problem that the Western press is just incapable of covering many of these topics. The press has been marginalized by the internet, so it’s a global trend. Newspapers have lower budgets, they struggle more for advertising, there is much more private and partisan ownership of media outlets. These are all global trends but they influence coverage on Russia also.

Even high-level, big outlets like The New York Times and Guardian face extremely aggressive, litigious teams of lawyers and lobbyists of these oligarchs who have infinite pockets and can afford long legal fights.

Many newspapers don’t have proper foreign country correspondents. If they do, they have to write quick articles, like one per week without delving into difficult topics. Then there is a vicious cycle where complicated cases about Russia are not covered in the West and so there is no interest about them. And since there is no interest there is no coverage.

The first stage is that you lose transparency, democracy and good governance. Israel is already losing that

Very often I found that I wasn’t able to put important topics out there just because it was too complicated for the journalist to write. Not even because of libel issues or because of time constraints. He or she would say, “My editor will not take it through because it’s too complicated. It delves too much into Russian detail.”

Most amazingly, most major media outlets do not have a full-time Russian translator and researcher who can fully devote his or her time to the most basic background research for the few investigative journalists that these outlets struggle to support.

What will happen to Israel if it does nothing about the corrupt kleptocratic influence you describe?

The first stage is that you lose transparency, democracy and good governance. Israel is already losing that. There is no longer separation of powers. There is prevalence of the executive. There is organized crime and no one takes action against it. The police do nothing. This is the first step.

Israel may give up many of its positions in Syria very soon. I can’t exclude that.

What definitely will happen if we continue on the current trajectory is that the entire West will turn into some kind of Hong Kong. where superficially it is democracy. It has some kind of elections, it looks capitalist and there is modern technology, but in reality a corrupt, non-democratic government actually runs it.

For the average person what does that mean? That you’re either a criminal or you’re poor?

Exactly, if you don’t become part of the corrupt network, you’re much worse off. You’ll be on the sidelines, as happens now in post-Soviet states. There will be growing income inequality, shady deals, no social mobility and all these problems that are associated with semi-corrupt authoritarian states.

There may still be some semblance of democracy. The press will do fewer and fewer investigations and more entertainment and brainwashing. It will be much more partisan — so the only differences of opinion you can get is from vested interests, not from independent and objective civil society.

What can be done?

It’s a very harsh, difficult choice. The first step is acknowledgement of what is going on, followed by investigations and revelations of all these things.

I am not even sure what can trigger such acknowledgement and exposure. Even the meddling in US elections has not triggered the United States enough, although at least something is happening.

After this acknowledgement happens, you need a very robust policy of containment. There is no other choice.

People walking near Red Square in Moscow, Russia. (Hadas Parush/Flash90)

Some money flows have to be stopped; some people have to be kicked out of your country, or even stripped of their Western citizenship. There must be much stricter anti-money laundering and due diligence of companies, and auditors should hire Russian or Georgian or Chinese translators to look into the background of people trying to buy assets in the West.

Security services have to have a major say in any strategic purchase related to security, defense or the national interest.

And then obviously there should be more funds for independent investigative reporters. I am friends with an organization called the Organized Crime and Corruption Reporting Project (OCCRP). They tell me that to train one proper investigative journalist and to keep him safe and to keep him protected from libel suits, you have to have a budget of about $300,000 a year, maybe $400,000.

If your readers care about Israel, about keeping it democratic, there should definitely be some civil society efforts

When societies start investing in investigative journalism like that, that’s when the job will be done. And it can’t be one investigative journalist. You have to have dozens.

If your readers care about Israel, about keeping it democratic, there should definitely be some civil society efforts, some donations, some Kickstarters. Ultimately people should understand that this will hit them back in terms of their own welfare and their access to democratic institutions, but ultimately even economically.

It could happen in very unexpected ways. Your child could end up in a war with Syria, or some conflict instigated by Russia somewhere in the world. In a way this is a repetition of the 1930s. No one thought that events in Nazi Germany would have any repercussions for the United States. But then the country ended up fighting the Germans when it was too late.

Could this covert Russian influence constitute a factor in a future Israeli war?

The West is like a small clean lake, or relatively clean lake, in the middle of a swamp. And the floodgates have been opened

What people in general in the West should understand is that the West and NATO are now becoming a minority force in the world; the power of the United States is declining. These large authoritarian states are taking over if not the world then at least Eurasia, countries like China and Malaysia that are not going to become democratic any time soon. The richer they get, the more authoritarian and the more aggressive and expansionist they become.

Democratic countries are becoming like an oasis in the desert. A better metaphor is that the West is like a small clean lake, or relatively clean lake, in the middle of a swamp. And the floodgates have been opened. It’s not like the small lake will clean up the swamp. It’s the other way around. So unless you close the doors and put some filters in place, you will be taken over as a swamp as well.

It won’t be easy. Consumption in the West will have to be scaled back from those money flows from Eurasia. Some industries will have to suffer, especially those that benefit from gas and oil contracts, as well as lobbyists, PR people, lawyers, all offshore accountants and real estate people. They will have to suffer; they will not make as much money.

But the society as a whole will benefit and be able to hold on to its values, like due diligence and good governance.

In terms of Israel specifically, if this does not happen, then I think the NATO alliance will be marginalized and might have to be involved in conflicts it doesn’t want. And then Israel will be much more on its own against its foes, and might not receive as much American help as it might hope to in such circumstances.

So all this has direct security implications for Israel as a society, and Israel as a state, unfortunately.

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COMMENTS

Corporate concentration threatens American democracy

(THIS ARTICLE IS COURTESY OF ‘THE WORLD POST’)

 

Corporate concentration threatens American democracy

By Nathan Gardels, WorldPost editor in chief

Corporate concentration in the United States is not only increasing inequality but also undermining competition and consumers’ standard of living. Politically, the commensurate lobbying influence of big tech, big finance and other large conglomerates has created what political scientist Francis Fukuyama calls a “vetocracy” — where vested concerns have amassed the clout to choke off legislative reforms that would diminish their spoils.

Why the opposite is happening in the European Union is an unfamiliar tale of how governance one step removed from electoral democracy has been able to resist the lobbying of organized special interests to make policy that benefits the average person.

Active antitrust policies in the second half of the 20th century fairly leveled the playing field of American commerce. “But starting around 2000, U.S. markets began to lose their competitive edge,” Germán Gutiérrez and Thomas Philippon write, based on a new study of theirs.

“Now, Internet access and monthly cellphone plans are much cheaper in Europe than in America, as are flights. Even in Mexico, mobile data plans are better priced than in the United States. … Meanwhile in the United States, deregulation and antitrust efforts have nearly ground to a halt. The United States has not completed a major reform to the goods and services market since 1996, and as a result, its industries have grown increasingly concentrated.”

What explains this stunning shift is deliberate policy choices. As the authors relate: “European countries created the single market, which took effect in 1993, and deregulated their domestic markets. Today, most European Union countries score better than the United States in enacting policies that make industries more competitive. Not surprisingly, antitrust enforcement remains active in Europe, with two recent cases against Google resulting in over $7.7 billion in fines. European markets are also less concentrated than U.S. markets.”

Gutiérrez and Philippon argue that “free markets are supposed to discipline private companies, but today, many private companies have grown so dominant that they can get away with bad service, high prices and deficient privacy safeguards. … If America wants to lead once more in this realm, it must remember its own history and relearn the lessons it successfully taught the rest of the world.”

Mario Monti — who was Italian prime minister from 2011 to 2013 as well as the E.U. competition commissioner from 1999 to 2004 and is famous for “shooting down mergers in flames” — agrees with Gutiérrez and Philippon. But he adds an important dimension they don’t discuss: how the much-maligned “technocratic” European Commission has been more able than American antitrust authorities to resist undue corporate influence over policy decisions.

While antitrust efforts in the United States are highly sensitive to election cycles and outcomes, Monti points out, the European Commission (which is indirectly elected by the European Parliament) operates at arm’s length from politics and can make decisions that are independent from lobbyist pressures on parliaments at both the national and European level. As he put it in a recent interview, “the more far away you are, the less you feel under pressure.”

The result is policy decisions that are more disinterested because the process is less politicized. This same technocratic distance in Brussels that has enabled a vigorous competition policy also applies to Europe’s landmark privacy regulation, the General Data Protection Regulation (GDPR), passed earlier this year.

Yet as Giovanni Buttarelli, the E.U.’s data protection supervisor charged with implementing the GDPR, laments, passing a law is only the beginning of reining in big tech abuses. “First came the scaremongering. Then came the strong-arming. After being contested in arguably the biggest lobbying exercise in the history of the European Union, the General Data Protection Regulation became fully applicable at the end of May,” he writes from Brussels. “Since its passage, there have been great efforts at compliance, which regulators recognize. At the same time, unfortunately, consumers have felt nudged or bullied by companies into agreeing to business as usual. This would appear to violate the spirit, if not the letter, of the new law.”

The challenge of implementing the law now, says Buttarelli, is continually challenging big tech. As he puts it, “The E.U. is seeking to prevent people from being cajoled into ‘consenting’ to unfair contracts and accepting surveillance in exchange for a service.”

Buttarelli is looking ahead to the next phase of reform. Under that reform, “Devices and programming would be geared by default to safeguard people’s privacy and freedom. Today’s overcentralized Internet would be de-concentrated, as advocated by Tim Berners-Lee, who first invented the Internet, with a fairer allocation of the digital dividend and with the control of information handed back to individuals from big tech and the state.”

While big tech lobbyists have so far frustrated privacy legislation at the national level in the United States, California has been able to pass curbs on abuses of personal data. Ironically, this was due not to technocratic insulation from politics but its opposite: the citizens’ ballot initiative. A San Francisco real estate magnate funded the gathering of qualifying signatures for a proposition that would impose the same kind of limits on use of personal data in California as contained in the GDPR, forcing big tech to come — reluctantly — to the table.

State legislators then negotiated and passed a measure this summer along GDPR lines that would be open to amendment as technology evolves. With legislation secured, the initiative was withdrawn from the public ballot. (If law is made by the citizens’ ballot initiative, it can only be amended by another vote of the public.) As state Sen. Bob Hertzberg (D), who crafted the compromise between privacy advocates and the tech companies, notes, the law in effect makes California’s attorney general the nation’s “chief privacy officer,” since most of the big tech companies affected are located in Silicon Valley.

Making a market that works for the average citizen requires government that acts in the public interest, not at the behest of the largest players in the economy who underwrite the electoral and legislative process. To the extent that elected legislatures are captured by organized special interests, the “vetocracy” can be circumvented either by indirectly elected technocratic authorities or by direct democracy through the citizens’ ballot initiative.

The experiences with antitrust and privacy regulation examined in The WorldPost this week suggest that a mixed system that combines disinterested technocrats, elected representatives and direct democracy — each as a check and balance on the other — would be the most intelligent form of governance.

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U.S.-Turkey Relations Will Never Be the Same

(THIS ARTICLE IS COURTESY OF BLOOMBERG NEWS)

 

U.S.-Turkey Relations Will Never Be the Same

Escalating tensions might simmer down, but we’re past the point of pretending these two governments’ values are compatible.

Hope you sold all your lira before this week.

Photographer: Chris McGrath/Getty Images

There are only two ways that the diplomatic rift between the U.S. and Turkey can end: a compromise that salvages the relationship as best possible, or a complete rupture with devastating consequences both for Turkey’s economy and America’s regional strategic interests. Either way, there is no going back to the way things were.

The arrest in Turkey of American pastor Andrew Brunson nearly two years ago has led to a diplomatic spat that threatens a full-blown economic meltdown in Turkey. Brunson, along with many foreign nationals that were detained in the wake of the failed 2016 coup attempt, has been accused of “supporting terrorism.” A deal for Brunson’s release seemed likely as Turkish officials traveled to Washington this week, but fell apart apparently over last-minute Turkish demands.

Meanwhile, tensions have ratcheted up. The Trump administration has imposed sanctions on Turkey’s interior and justice ministers. Erdogan threatened retaliation and got the support of most of the Turkish opposition. On Wednesday, Stars and Stripes reported that a group of pro-government lawyers in Turkey have filed charges against several U.S. officers at the Incirlik Air Base, accusing them too of ties to terrorist groups. They are demanding all flights leaving the base be temporarily suspended and a search warrant be executed.

The standoff is partly the accumulation of years of resentment, despite the pretenses of a faithful partnership. Turkey’s once-unassailable support among U.S. foreign policy leaders, and in Congress, has been weakened by years of authoritarian creep, a worsening human rights record and cooperation with Russia and Iran in Syria. Turkey’s plans for a $2 billion purchase of Russian-made S-400 surface-to-air missiles, which NATO has said are incompatible with allied systems and restrictions on American use of the Incirlik Air Base, haven’t gone down well.

The feeling is mutual. Erdogan has never quite recovered from his anger at the way his allies seemed to sit on the fence in the hours after an attempted coup was announced in July 2016.

The Turkish leader is also furious at American support for the Kurdish militia fighting Islamic State in northern Syria. Earlier this year, he threatened American troops with an “Ottoman slap” if the U.S. tried to block Turkey’s military incursion into northwest Syria.

One major source of contention has been the U.S. refusal to turn over the Pennsylvania-based cleric Fethullah Gulen, a one-time Erdogan ally and now an enemy, whom Erdogan alleges was behind the coup and other attempts to undermine him. Trump’s abandonment of the Iran nuclear deal is another sore point; nearly half of Turkey’s oil imports come from Iran, and the re-imposition of sanctions against Iran hurts Turkey’s economy.

The Brunson case made all of that impossible to ignore, as U.S. evangelicals took up the cause.

But “impossible to ignore” is not to say that the Trump administration has become a principled defender of human rights in Turkey. Far from it. Trump, whose name adorns luxury properties in Turkey, expressed only praise for Erdogan when they met in 2017. When Erdogan’s supporters and guards attacked protesters in Washington, the affair was handled quietly.

The administration has been silent on other arrests of U.S. and foreign nationals in Turkey. But it was ready to strike a deal for Brunson’s release. The U.S. had already asked Israel to release Ebru Ozkan, a Turkish national who was arrested there on suspicion of aiding Hamas (Israel deported herthe day after Trump called Israeli President Benjamin Netanyahu). The Trump administration was also reportedly ready to allow Hakan Atilla, a former top executive of state-owned Halkbank, convicted for violating Iran sanctions, to serve out the rest of his prison sentence in Turkey. The deal was scuppered, reportedly, when Turkey wanted relief on a multibillion-dollar fine against Halkbank and an assurance that any investigations be dropped.

The U.S. can afford to play a longer game. The June 24 election may have strengthened Erdogan’s power further, but he didn’t win by a Putin-sized margin. (Erdogan cleared just over 52 percent, and that’s if we all agree to ignore the voting irregularities that presumably bolstered his numbers.) Turkey is divided politically, and the longer Erdogan rules by coercion, the more vulnerable he may become, especially if Turkey’s economy continues to suffer. As the main barometer of confidence in the country, the lira’s decline speaks volumes.

Even so, a diplomatic solution is clearly preferable to continued escalation. Erdogan is sacrificing the Turkish economy in order to keep Brunson as a bargaining chit. A fractured relationship with the U.S. will also put a strain on Turkey’s EU relationships and will give investors, already spooked, even more pause.

American support for Turkey doesn’t crumble in a day. The relationship is baked into ties on multiple levels, both inside and outside government, and for good reason. As Asli Aydintasbas and Kemal Kirisci argue in an April 2017 Brookings paper, however bad it looks, Turkey is crucial:

Without Turkey, it is difficult to see how a rule-based U.S.-led world order could be sustained in this region, and how a successful policy on containing chaos in the Middle East could be envisioned. Similarly, there are arguably no Muslim-majority nations apart from Turkey that can serve as a bridge with the Western world or achieve the democratic standards, to which Turks have grown accustomed and, inadvertently or not, still expect.

And yet, it has definitely changed, thanks not so much to national interests, but to failings in leadership. The U.S. will have to settle for something less loyal, less an alliance and more a transactional relationship. But then that seems to define these times pretty aptly.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Therese Raphael at [email protected]

To contact the editor responsible for this story:
Philip Gray at [email protected]

The 2018 AGOA Forum: A turning point for US-Africa commercial relations?

(THIS ARTICLE IS COURTESY OF THE BROOKINGS INSTITUTE)

 

AFRICA IN FOCUS

The 2018 AGOA Forum: A turning point for US-Africa commercial relations?

Witney Schneidman and Landry Signé

The 2018 AGOA Forum—named for the African Growth and Opportunity Act passed in 2000 and extended three years ago to 2025—could be a turning point in U.S.-African commercial relations. AGOA abolished import duties on more than 1,800 products manufactured in eligible countries sub-Saharan Africa (those with established or making continuous progress with market-based economy, rule of law and pluralism, elimination of trade and investment barriers to the U.S., human rights, labor standards, fight against corruption, and economic policy to reduce poverty among others). Another 5,000 products are eligible for duty-free access under the Generalized System of Preferences program. As of today, 40 African countries are AGOA-eligible.

REGIONALISM VS SINGLE COUNTRY TRADE AGREEMENTS

Africa’s trade ministers will be coming to Washington the week of July 9, riding the momentum of having adopted the African Continental Free Trade Agreement in March. Once fully implemented, the AfCFTA, as it is known, requires members to remove tariffs on 90 percent of goods and to allow free access to goods, services, and commodities. The AfCFTA is central to accelerated regional integration and economic development across the region.

While Africa is forging new trade relations internally, the Trump administration has a new proposal for future U.S.-Africa trade relations, and wants to establish “a free trade agreement that could serve as a model for developing countries.” Kenya, Côte d’Ivoire, and Ghana are under consideration as partners for developing the first model according to sources in the Trump administration.

The question for this AGOA Forum is whether it can forge a common vision between Trump administration officials and Africa’s trade ministers on how to structure a post-AGOA trade relationship. Specifically, can Africa’s continental free trade ambitions, embedded in the AfCFTA, be harmonized with the Trump administration’s model free trade agreement based on a single country?

The AfCFTA should be the ideal tool to foster U.S.-Africa commercial relations, with an agreement between Africa at the continental level and the United States. American corporations benefit from a continental approach versus a country-specific one. In fact, by 2030, Africa will be home to 1.7 billion people and $6.7 trillion of combined customer and business spending. The AfCFTA presents the opportunity for a single point of entry, reduced cost of doing business, economies of scale, lower tariffs, and increased commercial transaction—which could contribute to job creation in the U.S. However, the AfCFTA still has to come into force, and some African countries, including economic powerhouses like Nigeria, have not yet joined the initiative. It is therefore critical for the African Union to adopt a more proactive strategy for its relations with the U.S. and propose an attractive continental partnership to the U.S. to advance mutual interests.

The task will not be easy for the African Union and the AfCFTA and, on the surface, it is hard to see where compatibility will be found in the differing approaches to the future of U.S.-African trade relations. In fact, the U.S. tried to forge a free trade agreement with South Africa and the Southern African Customs Union more than a decade ago and was unsuccessful. Moreover, U.S. free trade agreements are comprehensive, complex, and take time to negotiate. Given the rapid rise of China’s trade with the continent and the European Union’s Economic Partnership Agreements—which increasingly puts American goods at a significant tariff disadvantage in a growing number of African markets—a singular model trade agreement could do little to bolster the U.S. trade and investment position across an African continent working to fully integrate into the global economy. Moreover, Africa is seeking a regional approach to its trading relationships and not a country-by-country process.

While the U.S. Trade Representative works to develop a future U.S.-trade relationship with Africa, a positive Trump Africa legacy could revolve around its support for the bipartisan BUILD Act (Better Utilization of Investments Leading to Development Act), which is making its way through Congress and, if passed, would create the U.S. International Development Finance Corporation (USIDFC). The new agency would transform the existing Overseas Private Investment Corporation by doubling its size and enabling it to make equity investments of up to 20 percent in U.S. projects, among other new capabilities. As Africa is the largest part of OPIC’s current investment portfolio, the proposed USIDFC promises to be a key part of any enhanced U.S. commercial engagement in Africa.

WORKING TOWARD COMMON GROUND

The 2018 AGOA Forum could be a turning point for U.S.-Africa commercial relations. The African Union has already made important progress by organizing an annual AGOA mid-term review, along with its partner organizations (the United Nations Economic Commission for Africa and the regional economic communities), to help organize the AGOA Forum. However, if Africans do not succeed at putting a continental approach on the agenda during the forum, they should quickly follow up with an evidence-based comprehensive strategy that will provide options to the U.S. to best serve mutual interests, advance the continental perspective and Agenda 2063, and make America more competitive in a context where China and the European Union are winning. A win-win strategy is the way forward from both sides.

Saudi Banking Sector Exceeds Basel I Requirements

(THIS ARTICLE IS COURTESY OF THE SAUDI NEWS AGENCY ASHARQ AL-AWSAT)

 

Saudi Banking Sector Exceeds Basel I Requirements

Friday, 6 July, 2018 – 10:45
The Kingdom Centre Tower is seen in Riyadh, Saudi Arabia, November 5, 2017. Picture taken November 5, 2017. REUTERS/Faisal Al Nasser
Riyadh – Fateh al-Rahman Youssef
A Saudi official has said that Saudi banks capital adequacy in the first quarter of this year exceeded 20.4 percent, surpassing the Basel I committee’s requirements of capital adequacy by two and half times.

Secretary General of the Committee on Information and Awareness Raising in Saudi Banks Talaat Hafez told Asharq Al-Awsat that liquid assets reached in the current year 20.6 percent, a high rate of financial efficiency in terms of liquidity size in the banking sector.

He noted that more than 18,000 ATMs and above 310,000 points of sale are distributed in the kingdom to support the development of e-services.

He pointed out that the liquid assets for short-term requirements reached in the first quarter of the current year 32 percent, a sign of good liquidity in banks and high financial solvency.

Hafez stressed that banks are working hard after announcing the financial sector development program, one of the 12 ambitious programs linked to Saudi Vision 2030, which focuses on supporting the private sector.

“The Saudi financial sector is currently working on developing the products’ base and reinforcing financial inclusion in which services are available for all clients,” he added.

Hafez continued that there are ongoing efforts under the supervision of the Saudi Arabian Monetary Authority to develop the digital structure as one of the requirements of the vision, transformation program and development of the financial sector to have a digital Saudi society.

Cryptocurrency-related crime will surpass all other cyber attacks in 2018

(THIS ARTICLE IS COURTESY OF THE TIMES OF ISRAEL NEWSPAPER)

 

Cryptocurrency-related crime will surpass all other cyberattacks in 2018: expert

Leading experts at Tel Aviv cybersecurity conference weigh pros and cons of cryptocurrencies like Bitcoin, and the risks of blockchain technology in financial transactions

Illustrative image of bitcoins (Courtesy BitsofGold)

Illustrative image of bitcoins (Courtesy BitsofGold)

Cryptocurrency-related attacks will surpass all other types of cyberattacks in 2018, a leading expert warned.

Issuing the bleak prediction, Lotem Finkelsteen, a threat intelligence analyst with the Israeli cybersecurity company Check Point Software Technologies, said “not a day goes by without our hearing about a new ICO [initial coin offering] scam or mining attack.”

By “cryptocurrency-related cyberattacks,” he appeared to be referring to any form of cybercrime involving or related to cryptocurrencies, including financial scams and hacking.

Blockchain, the technology that underpins cryptocurrencies, “is suffering from reputational damage,” said Finkelsteen. “And that is one of the main obstacles for blockchain technology to move forward.”

Lotem Finkelsteen (Twitter)

Finkelsteen was speaking on a panel at an event entitled “Blockchain, The New Digital Age” at Tel Aviv University’s annual Cyber Week cybersecurity conference. Other panelists at the event were more optimistic about the positive potential for blockchain and cryptocurrency technology.

“There are real projects rolling out,” said John Velissarios, Principal Director and Global Blockchain Technology Lead at Accenture, a global management consulting company. “We’re seeing blockchain applications for capital markets, exchanges, clearing and settlement systems and payment systems. The technology is evolving and the applications are becoming more significant.”

Blockchain technology is the underlying technology of Bitcoin and other cryptocurrencies. A blockchain is a database that is maintained by numerous collaborators, like a Google document. The computers of the collaborators decide through a consensus mechanism how to update the database. Once they decide, the update is rendered immutable through cryptography. The resulting record can be used as proof of ownership without the need for a central authority deciding who owns what.

Many entrepreneurs and computer scientists see enormous potential in blockchain, and believe that the fact that money and other assets can be transferred from person to person without going through a central authority has many real-world applications.

But Haim Pinto, the CTO of Bank Hapoalim, Israel’s largest bank, asserted that there are no blockchain applications that are dependably usable at present, least of all for a trusted institution like a major commercial bank.

“Blockchain is still in a hype cycle,” he said in the panel discussion, arguing that the technology is not yet ready for widespread adoption. “We can’t just take it and use it.”

Pinto said cryptocurrencies present problems for banks seeking to comply with anti-money laundering and privacy regulation.

“As long as we are under anti-money laundering and FATCA rules, we have to know the source of customers’ money,” he said. This requirement, he said, does not jibe with the nature of cryptocurrencies, which can be transferred anonymously.

In addition, said Pinto, cryptocurrencies present a challenge for banks seeking to comply with the EU’s “right to be forgotten” laws, which require that businesses erase clients’ sensitive personal data if they are asked to do so.

“Distributed general ledgers cannot erase anything,” he said, referring to the fact that most blockchains are immutable. “That’s just one of the challenges. In addition, there are mathematical challenges. Distributed general ledgers can’t scale up to the volume of transactions we need to serve.”

Pinto said that most banks around the world are running mainframe computers as their core platforms. Before they can adopt blockchains or distributed general ledgers, they will probably first adopt “open banking,” a new trend in the banking world that refers to the practice of allowing third-party developers to build applications around the bank.

In recent years in Israel, some experts have touted cryptocurrency and blockchain as the next major driver of the Israeli economy, but as The Times of Israel has reported, it is unclear how much of the activity in this new high-tech field is legitimate, how much is mere hype, and how much is outright fraud perpetrated by malevolent actors, including transnational criminal organizations.

A second panel at the event dealt with the non-financial applications of the blockchain.

At that session, Gideon Lichfield, the editor-in-chief of the MIT Technology Review, described enthusiasm about using blockchain technology for supply-chain management.

Gideon Lichfield (Courtesy Cyber Week)

“Businesses see it as a way to track bananas or lettuce from the supplier to the supermarket shelf.”

If some lettuce turns out to be bad, he said, blockchain technology can be used to find out which farm the lettuce came from.

Lichfield questioned why blockchain is a good solution for this, as opposed to a centralized database or some other solution. Nevertheless, he said, if blockchain is an adequate solution, it could become the de facto standard, simply because there is so much hype around, and money being poured into, blockchain technology.

“Big companies don’t want to be left behind,” said Lichfield, ”They jump into this.”

Steve Bassi, the CEO of the cybersecurity company Polyswarm, agreed with the other panelists that blockchain is often proposed as a solution to a problem where a centralized database might work just as well.

Attempting to distill the circumstances under which blockchain could be useful, he asked, “Where do we always cheat each other unless someone else is watching? That is where blockchain might be applicable.”

Another speaker at the final session of the conference on Thursday, Tel Aviv University Economics professor Neil Gandal, presented a paper called “Price Manipulation in the Bitcoin Ecosystem” that he and his colleagues first published in January.

Tel Aviv University Economics Professor Neil Gandal speaks at Cyber Week, June 21, 2018 (Simona Weinglass/Times of Israel)

Gandal contended that Bitcoin’s first major price spike, when it rose from $150 to over $1,000 in late 2013, was likely caused by a single person using trading robots.

Gandal argued that if this could happen once it could happen again, and cited a recent paper by University of Texas economists arguing that Bitcoin’s more recent price spike, when it reached close to $20,000 last year, was also caused by price manipulation.

“It’s possible for a small number of actors to manipulate things,” he said. “We need some sort of regulation [of cryptocurrencies],” he said. “There is a loss of confidence in the system.”

READ MORE:
COMMENTS

Argentina Is In Crisis, In Danger Of Collapse From The Inside, Government Is Aloof

(THIS ARTICLE IS COURTESY OF BRAZIL 247 NEWS)

 

Map Shows The Salary You Need To Afford A Home In Every State

(THIS ARTICLE IS COURTESY OF ‘SIMPLEMOST’ ‘CURIOSITY’)

 

CURIOSITY

Map Shows The Salary You Need To Afford A Home In Every State

Where does your state rank?

Chances are you’ve considered how much money you would need to earn in order to buy a home. The answer, of course, depends largely on where you live. To give you an idea, finance website HowMuch.net recently crunched the housing affordability numbers for each state.

To arrive at its estimates, the website layered in several factors. The team collected average home prices in every state from Zillow, then plugged those figures into a mortgage calculator to determine monthly payments. HowMuch.net considered an interest rate that varied between 4 and 5 percent in each state. Also, it was assumed buyers were contributing a 10-percent down payment.

Existing Home Sales And Prices Hit Record High
Getty Images | Tim Boyle

Given that many financial advisors recommend the total cost of housing take up no more than 30 percent of gross income (i.e. the amount before taxes, retirement savings, etc.), the data team used that rule as a benchmark to calculate the minimum salary needed to afford the average home in each state. The figures are based on 30-year mortgages.

HowMuch.net

Next, we took HowMuch.net’s findings a step further by including the latest U.S. Census Bureau data on median household income to help illustrate how affordable a home purchase may actually be for the average person living in that state.

Ready to see how your state fares when it comes to affordability and home prices?

Alabama

Salary needed to afford a home: $47,960

Median household income: $46,257

gulf shores alabama photo
Flickr | chocmonk

Alaska

Salary needed to afford a home: $67,280

Median household income: $76,440

anchorage alaska photo
Getty Images | Streeter Lecka

Arizona

Salary needed to afford a home: $67,280

Median household income: $53,558

sedona photo
Getty Images | Bruce Bennett

Arkansas

Salary needed to afford a home: $41,040

Median household income: $44,334

little rock arkansas photo
Flickr | Sean Davis

California

Salary needed to afford a home: $120,120

Median household income: $67,739

golden gate bridge photo
Getty Images | Justin Sullivan

Colorado

Salary needed to afford a home: $100,200

Median household income: $65,685

downtown denver photo
Getty Images | Doug Pensinger

Connecticut

Salary needed to afford a home: $75,280

Median household income: $73,433

Connecticut photo
Flickr | jjbers

Delaware

Salary needed to afford a home: $67,960

Median household income: $61,757

delaware photo
Flickr | -Jeffrey-

District Of Columbia

Salary needed to afford a home: $138,440

Median household income: $75,506

washington dc photo
Flickr | szeke

Florida

Salary needed to afford a home: $70,360

Median household income: $50,860

florida beach photo
Flickr | apasciuto

Georgia

Salary needed to afford a home: $59,520

Median household income: $53,559

savannah georgia summer photo
Flickr | Ken Lund

Hawaii

Salary needed to afford a home: $153,52o

Median household income: $74,511

hawaii photo
Flickr | Anthony Quintano

Idaho

Salary needed to afford a home: $70,360

Median household income: $51,807

idaho photo
Flickr | treegrow

Illinois

Salary needed to afford a home: $53,880

Median household income: $60,960

chicago photo
Flickr | szeke

Indiana

Salary needed to afford a home: $42,560

Median household income: $52,314

Indianapolis photo
Getty Images | Chris Graythen

Iowa

Salary needed to afford a home: $44,360

Median household income: $56,247

iowa state fair photo
Flickr | SchwhatNow

Kansas

Salary needed to afford a home: $43,160

Median household income: $54,935

downtown topeka photo
Flickr | Dougtone

Kentucky

Salary needed to afford a home: $44,360

Median household income: $46,659

kentucky photo
Flickr | nickirp

Louisiana

Salary needed to afford a home: $50,320

Median household income: $45,146

new orleans photo
Flickr | faungg’s photos

Maine

Salary needed to afford a home: $55,520

Median household income: $53,079

maine photo
Flickr | Ken Lund

Maryland

Salary needed to afford a home: $72,200

Median household income: $78,945

maryland photo
Flickr | Dougtone

Massachusetts

Salary needed to afford a home: $101,320

Median household income: $75,297

boston photo
Getty Images | Maddie Meyer

Michigan

Salary needed to afford a home: $40,800

Median household income: $52,492

downtown detroit photo
Getty Images | Chip Somodevilla

Minnesota

Salary needed to afford a home: $64,720

Median household income: $65,599

minneapolis photo
Getty Images | Tom Dahlin

Mississippi

Salary needed to afford a home: $44,360

Median household income: $41,754

mississippi photo
Flickr | Ken Lund

Missouri

Salary needed to afford a home: $42,200

Median household income: $51,746

st louis arch photo
Getty Images | Todd Warshaw

Montana

Salary needed to afford a home: $75,520

Median household income: $50,027

glacier national park montana photo
Flickr | dconvertini

Nebraska

Salary needed to afford a home: $51,520

Median household income: $56,927

omaha nebraska photo
Getty Images | Peter Aiken

Nevada

Salary needed to afford a home: $73,120

Median household income: $55,180

las vegas strip photo
Flickr | holidaypointau

New Hampshire

Salary needed to afford a home: $68,440

Median household income: $70,936

new hampshire photo
Flickr | kla4067

New Jersey

Salary needed to afford a home: $69,640

Median household income: $76,126

jersey shore photo
Flickr | milst1

New Mexico

Salary needed to afford a home: $54,880

Median household income: $46,748

albuquerque photo
Flickr | Corvair Owner

New York

Salary needed to afford a home: $91,720

Median household income: $62,909

new york city photo
Flickr | Zeeyolq Photography

North Carolina

Salary needed to afford a home: $63,840

Median household income: $50,584

outer banks beach photo
Flickr | smkybear

North Dakota

Salary needed to afford a home: $56,000

Median household income: $60,656

north dakota photo
Getty Images | Andrew Burton

Ohio

Salary needed to afford a home: $38,400

Median household income: $52,334

roebling bridge cincinnati photo
Flickr | string_bass_dave

Oklahoma

Salary needed to afford a home: $45,320

Median household income: $49,176

oklahoma photo
Flickr | Larry Smith2010

Oregon

Salary needed to afford a home: $87,160

Median household income: $57,532

cannon beach photo
Getty Images | Brent Stirton

Pennsylvania

Salary needed to afford a home: $47,960

Median household income: $56,907

philadelphia photo
Flickr | Jamesy Peña

Rhode Island

Salary needed to afford a home: $69,640

Median household income: $60,596

providence photo
Flickr | spablab

South Carolina

Salary needed to afford a home: $58,840

Median household income: $49,501

charleston rainbow row photo
Flickr | AJ Photographic Art

South Dakota

Salary needed to afford a home: $55,360

Median household income: $54,467

south dakota photo
Flickr | Ladycliff

Tennessee

Salary needed to afford a home: $55,760

Median household income: $48,547

ryman auditorium photo
Flickr | Picster Jimster

Texas

Salary needed to afford a home: $66,080

Median household income: $56,565

san antonio riverwalk photo
Flickr | J.R.Ramos

Utah

Salary needed to afford a home: $83,720

Median household income: $65,977

park city utah photo
Flickr | Ken Lund

Vermont

Salary needed to afford a home: $62,600

Median household income: $57,677

vermont photo
Flickr | denisbin

Virginia

Salary needed to afford a home: $71,960

Median household income: $68,114

virginia photo
Flickr | lukas schlagenhauf

Washington

Salary needed to afford a home: $87,040

Median household income: $67,106

space needle photo
Flickr | Maëlick

West Virginia

Salary needed to afford a home: $38,320

Median household income: $43,385

new river gorge bridge photo
Flickr | jalexartis

Wisconsin

Salary needed to afford a home: $50,080

Median household income: $56,811

madison wisconsin photo
Getty Images | Jamie Squire

Wyoming

Salary needed to afford a home: $58,000

Median household income: $59,882

jackson hole photo
Flickr | Larry Johnson

Following the Money in Trumpland Leads Ugly Places

(THIS ARTICLE IS COURTESY OF THE ‘NEW YORKER’ MAGAZINE)

 

 / THE NATIONAL CIRCUS

Following the Money in Trumpland Leads Ugly Places

By 

Michael Avenatti is doing what Woodward and Bernstein did: exposing the money trail. Photo: MSNBC

Most weeks, New York Magazine writer-at-large Frank Rich speaks with contributor Alex Carp about the biggest stories in politics and culture. Today, the meaning of Michael Avenatti’s disclosures, Trump’s decision to kill the Iran deal, and Rudy Giuliani’s media tour.

With Michael Avenatti’s revelation that the shell company Michael Cohen used for the Stormy Daniels payoff also received money tied to Russian oligarch Viktor Vekselberg (as well as payments from other companies with government business), it looks like the two main threads of Donald Trump’s legal troubles may be part of the same story. Has Avenatti found the “collusion” that Trump has spent so much energy denying?

Avenatti, whose revelations have since been verified by the Times and others, is doing exactly what Woodward and Bernstein did in Watergate — following the money. By doing so he has unveiled an example of collusion so flagrant that it made Trump and Rudy Giuliani suddenly go mute: a Putin crony’s cash turns out to be an essential component of the racketeering scheme used to silence Stormy Daniels and thus clear Trump’s path to the White House in the final stretch of the 2016 election. Like the Nixon campaign slush fund that Woodward and Bernstein uncovered, this money trail also implicates corporate players hoping to curry favor with a corrupt president. Back then it was the telecommunications giant ITT, then fending off antitrust suits from the government, that got caught red-handed; this time it’s AT&T. Both the Nixon and Trump slush funds were initially set up to illegally manipulate an American presidential election, hush money included. But the Watergate burglars’ dirty tricks, criminal as they were, were homegrown. Even Nixon would have drawn the line at colluding with Russians — or, in those days, the Soviets — to sabotage the Democrats.

5 of the Most Blatantly Unethical Moves by the Trump Administration

I know some accuse Avenatti of being a media whore, but he’s the one media whore I can’t get enough of. He knows what he’s doing, he has the goods, and he is playing high-stakes poker, shrewdly, with what appears to be a winning hand. It is also entertaining to imagine how crazy he is driving Trump. In personality and presence he’s exactly the kind of take-no-prisoners television defender that Trump would want appearing with Sean Hannity in his defense. That was the point of the Mooch. That is the point of Rudy. Apparently that was even once the point of Michael Cohen. If Avenatti, as others have noted, is Billy Flynn from the musical Chicagothen Trump is left with Larry, Curly, and Moe.

Donald Trump’s decision to pull the U.S. from the Iran deal has drawn condemnation from European alliesBarack Obama, and scores of other experts. Will Trump face any political penalty for his choice?

Honestly, I doubt Trump will still be in office when the full fallout of this blunder is felt. The blunder, one should add, is not only to pull out of a deal that was working but also to have no “better deal” (or policy at all) to take its place. But the interesting political piece about both this decision and the onrushing summit with Kim Jong-un is that Trump has persuaded himself that big bold foreign policy moves, however harmful to America and its allies, will rescue him from the rampaging scandal at home. This, again, has a Watergate echo: As the revelations of White House horrors piled up during the midterm election season of 1974, Nixon decided to travel to Moscow, ostensibly a diplomatic mission in the cause of détente. This stunt didn’t stave off the wolves closing in on him in Washington, and the current regurgitation of this tactic won’t save Trump either.

At least Nixon had foreign-policy expertise. He wouldn’t have given away the store to the Soviet leader Leonid Brezhnev. By contrast, there’s every reason to fear that Trump’s ignorant foray into Korea will make Neville Chamberlain’s performance at Munich look Churchillian. Kim is not an idiot; he will keep playing the American president for all he can, knowing that Trump needs a “win” abroad to counterbalance all his losses at home. And Trump’s desperation to make a “deal” with North Korea for his own personal political salvation gets visibly greater with every Michael Avenatti television appearance. Witness the president’s decision to turn up at Andrews Air Force Base at 2 a.m. tomorrow to personally greet the three American detainees that North Korea released today. That Trump thinks this photo op will be effective counterprogramming to Stormy Daniels suggests he’s now lost one talent he unassailably did possess, an intuitive knack for show business.

Even in non-corrupt modern presidencies, there’s little evidence that foreign-policy achievements sway voters. (Foreign-policy debacles — wars that devolve into quagmires, for instance — do move voters, but not in a good way.) In Trump’s case, his America First base could not care less if he wins one of those suspect foreign Nobel Prizes as meaningless as the one awarded Obama. The majority of Americans who are not in Trump’s base won’t care either. Meanwhile, nuclear proliferation and possibly war hang in the balance.

After subjecting the country to a week of the Rudy Giuliani media tour, Donald Trump is now considering sidelining the lawyer. Has Giuliani done more damage to his own reputation or to Trump’s defense?

Both Trump’s legal strategy (if there is one) and Rudy’s reputation were in tatters well before this frequently hilarious and wholly unhinged media tour. It’s an indicator of how much the Trump defense is in disarray that the White House thought it was a good idea to send Giuliani to last weekend’s Sunday shows even after nearly a full week of screwups. And the debacle just keeps rolling along: Just hours before Avenatti posted his bombshell yesterday, Rudy was firmly declaring that Michael Cohen “possesses no incriminating information about the president.”

There’s clearly not just a screw loose in Giuliani but a missing link in his story with Trump. Rudy was a fierce Trump defender during the campaign and lobbied vociferously for a Cabinet position during the transition. Twice he was considered for both secretary of State and secretary of Homeland Security, and twice he was rejected. What does that say about him when you consider that those who did make the cut to top Trump administration jobs included Michael Flynn, Ben Carson, Tom Price, Scott Pruitt, Betsy DeVos, and Ryan Zinke? What does Giuliani have for — or on — Trump that brought him into the fold now? Inquiring minds would like to know.

In any case, Trumpism has bequeathed America not merely a post-fact but post-rule-of-law culture. Rudy, like his boss, claims nonexistent extralegal privileges for presidents, dismisses FBI agents as “stormtroopers,” and endorses “rumor” as a legal strategy. I’d say his record for mad-dog lunacy is perfect were it not for the moment when he told Hannity that Jared Kushner is “disposable” — a judgment that no doubt reflects the view of Kushner’s father-in-law and is surely correct. That is our national Godfather replay at its best.

Turks, Saudis, UAE said to pump quarter billion dollars into East Jerusalem

(THIS ARTICLE IS COURTESY OF THE TIMES OF ISRAEL)

 

Turks, Saudis, UAE said to pump quarter billion dollars into East Jerusalem

Israeli officials fear funds to ‘rescue’ Muslim holy sites could touch off Palestinian violence in run up to US embassy move to Israeli capital

File: Waqf officials and others prepare to pray outside the Temple Mount, in Jerusalem's Old City, rather than enter the compound via metal detectors set up by Israel following a terror attack, July 16, 2017. (Yonatan Sindel/Flash90)

File: Waqf officials and others prepare to pray outside the Temple Mount, in Jerusalem’s Old City, rather than enter the compound via metal detectors set up by Israel following a terror attack, July 16, 2017. (Yonatan Sindel/Flash90)

Less than two weeks away from the scheduled transfer of the US Embassy from Tel Aviv to Jerusalem, Turkey, Saudi Arabia and the United Arab Emirates are pumping a quarter of a billion dollars into the Islamic Waqf and a slew of Muslim organizations in East Jerusalem, Hadashot news reported Wednesday.

The Waqf (Muslim Trust) administers the Temple Mount, home to the Al-Aqsa Mosque, Islam’s third holiest shrine, as well as a slew of schools, orphanages, Islamic libraries, Islamic courts and other properties. The mount is the holiest place in Judaism as the site of the ancient temples. Israel maintains overall security control at the site.

The three countries are describing the move as an act of “rescue” to finance renovations at holy sites, but Israeli officials fear their involvement will go beyond money and could spark violence in the run-up to the ribbon-cutting on May 14, the TV report said.

On Sunday, Hadashot News reported that US President Donald Trump was looking increasingly likely to come to the ceremony and was mulling allowing convicted American spy Jonathan Pollard to come too by lifting restrictions that prevent him from travelling to Israel.

Jonathan Pollard (left), and his lawyer Eliot Lauer leave federal court in New York following a hearing, July 22, 2016. (AP/Larry Neumeister, File)

Pollard served nearly 30 years for spying for Israel, and since being paroled in 2015 has been prohibited from leaving US soil, barring him from moving to the Jewish state as he wishes.

Trump’s announcement late last month that “I may go” to the ceremony reportedly surprised Israeli officials who had received no indication from the Americans that he might be attending.

It had been previously reported that Trump had considered but decided against attending the inauguration.

Treasury Secretary Steven Mnuchin is currently set to lead the 250-member delegation for the event, which will include 40 members of Congress and Trump’s son-in-law Jared Kushner and daughter Ivanka Trump. Other media reports have suggested that US Secretary of State Mike Pompeo could lead the delegation, in lieu of a Trump arrival.

Welcomed by Israel, the Palestinians have seen the embassy move as a provocation, and have said it effectively negates the possibility of the Trump administration serving as an honest broker in peace talks. Palestinian Authority President Mahmoud Abbas and other PA officials have refused to meet with anyone on Trump’s team since he recognized Jerusalem as Israel’s capital in December.

Palestinian Authority President Mahmoud Abbas gestures as he speaks during a press conference on Jerusalem, in the West Bank city of Ramallah on April 11, 2018. (AFP/Abbas Momani)

The opening of the embassy will take place just two days after the deadline for Trump’s decision on whether or not to scrap the the Joint Comprehensive Plan of Action signed in 2015 between Tehran and six world powers, including the US, under then-president Barack Obama.

The agreement curbed Tehran’s controversial nuclear enrichment program in exchange for relief from international sanctions.

Trump has termed the agreement the “worst deal ever” and has called on the other signatories to “fix it.”

He has threatened to tear up the deal unless new restrictions are imposed on Iran’s ballistic missile program and other military activities by May 12.

Prime Minister Benjamin Netanyahu is campaigning for the deal to be fixed or nixed.

On Tuesday, he revealed that the Mossad intelligence agency had obtained 100,000 documents from Iran’s own secret nuclear weapons archive proving, he said, that the 2015 deal was based on “Iranian deception.”

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