Middle East

Gulf Arab oil-producing states may soon abandon their currencies’ peg to the dollar. According to a recent Merrill Lynch & Co. report, the U.S. Treasury Department has effectively given Gulf Arab oil producers the green light to break their currency peg to the dollar and instead rely on a currency basket for their financial stability. Merrill Lynch & Co. says that both the United Arab Emirates and Qatar will probably remove the dollar-fixated exchange rate and move to a currency basket within the next few months. Kuwait already enacted both of these measures over a year ago, and Saudi Arabia may do the same before the end of next year. The reason: skyrocketing American inflation. Over the long-term, ending the petrol-dollar peg means reduced global demand for dollars. However, if other countries with much larger dollar reserves, like China and Japan, try to offload some of their dollar holdings before the dollar further devalues, a dollar crisis will develop, and the disastrous consequences for the American economy will be immediate.

Israeli Prime Minister Ehud Olmert confirmed on Sunday that Israel has been conducting secret peace talks with Syria, via Turkey, for more than a year. Meanwhile, Syria continues to cement ties with Israel’s greatest enemy, Iran. Syrian Defense Minister Gen. Hassan Turkmani visited Tehran May 24 and, in a meeting with his Iranian counterpart, worked to consolidate defense ties between the Syrian and Iranian regimes. “Our cooperation with the Iranians against Israeli threats is nothing secret, and we regularly consult about this with our friends,” Turkmani said. In another meeting, Turkmani told Iranian Gen. Yahya Rahim Safawi, a trusted military adviser of Ali Khamenei, that “Iran and Syria share the same viewpoint regarding regional issues and efforts will be made to strengthen our shared interests and bilateral relations.” Shockingly, Prime Minister Olmert is proceeding with his Syrian negotiations as if nothing has happened. He seems to be ignoring the fact that his negotiation partner is still strengthening its military alliance with the nation that is unabashedly calling for Israel to be wiped off the map.

Meanwhile, Olmert’s days as prime minister appear to be numbered, as turbulent personal matters threaten his coalition and tenure in office. With the Israeli prime minister being investigated on charges involving bribery and business scandal, Israeli Defense Minister Ehud Barak, leader of the Labor Party, is calling for him to either step down until the crisis is resolved or face general elections. If Barak withdraws his 17 Labor Party mks from their coalition with Olmert’s Kadima party, the government would lose its parliamentary majority and general elections would have to be scheduled. Olmert thus far has refused to step down.

Now that Hezbollah has effectively taken over Lebanon, the United Nations seems to be doing all it can to avoid inconveniencing the terrorist organization. Rather than taking a stand against the forces that have transformed the country into an Iranian proxy, the United Nations Interim Force in Lebanon (unifil), already an utterly ineffective force, is increasing its cooperation with the new Hezbollah-friendly government, sources say. One Lebanese security official said, “unifil used to coordinate with the Lebanese Army, but now that is only for show. unifil keeps Hezbollah informed of its movements at practically all times. There is no stomach for any misunderstanding that could lead to a confrontation.” As Iran establishes a terrorist proxy state on Israel’s northern border, unifil lacks the will to do anything about it.

Europe

Several small political groupings, including Europe’s main Euroskeptic group, will be eliminated from European Parliament if a proposed amendment is adopted. The pan-European Euroskeptic group, Independence and Democracy (Ind/Dem), which has only 23 members, would lose its speaking rights, committee positions and significant funding—privileges that come only from being an official political grouping. Judging by this and past actions, particularly surrounding the EU constitution, democracy and debate get in the way of the European Union. In order to function more efficiently, Europe must become less democratic. Watch for this trend to be reflected in future headlines.

Increasing Europe’s influence on the world stage will be France’s top priority when it takes over the rotating presidency of the EU on July 1, according to French Foreign Minister Bernard Kouchner. Kouchner also stated that he wanted the EU to have a more effective foreign policy and better defense cooperation. Watch for Europe to become more unified in these areas.

France will also pursue closer ties between the EU and Ukraine during its presidency. “As head of the European Council I will want to propose an ambitious partnership for Ukraine,” said French President Nicolas Sarkozy. “When we are in Kiev, we are in a European city.” Ukraine is on the frontier between Russia and Europe. Both want to draw it into their respective sphere of influence. For more information, read our article “Black Sea—New EU Frontier?”

Also this week, Sarkozy made it clear that Turkey does not belong in Europe. He said that he did not think of a state that is predominantly Muslim as European. Unlike Ukraine, Turkey is already a candidate for EU membership. Turkey will not join the EU, however, for the precise reason Sarkozy mentioned. Europe is a club of Christians, and Muslim Turkey will not be allowed to enter.

Asia

In Taiwan, the new president, Ma Ying-jeou, has supposedly opened a “new chapter of peace” with Communist China. On Monday, President Ma sent the highest-level Taiwanese political delegation to visit the mainland since the two sides split during the Chinese Communist Revolution in 1949. This delegation met with Chinese President Hu Jintao on Wednesday and the two sides agreed to resume talks on the establishment of direct flights between China and Taiwan and on allowing tourists from mainland China into Taiwan. The first round of these talks will occur June 11 to 14. Beijing, which has previously threatened Taiwan with invasion if the self-ruled island ever declares independence, is zealously taking advantage of the new Taiwanese administration’s pro-China stance to draw the island as close to the mainland as possible. While Ma Ying-jeou and the new Taiwanese government may think they can secure their home by negotiating with their Communist rival, the fact remains that while Taiwan may have given up its hopes of ruling over mainland China, mainland China has never renounced its ambition to rule Taiwan. The current negotiations between Taiwan and China are the first steps toward a coming annexation of democratic Taiwan to Communist China.

Tensions are increasing between Russia and Georgia due to the presence of Russian “peacekeeping” troops in Georgia’s breakaway province of Abkhazia. On Wednesday, one Georgian member of parliament stated that if Russia does not agree to gradually withdraw its troops so they can be replaced by a European-trained Georgian police force, the Georgian government may declare the Russian troops to be “occupiers” instead of “peacekeepers.” Russia is continuing to exert pressure on Georgia to ensure that it stays within the Russian sphere of influence and does not join the nato alliance. The Caucasus will continue to be an area of conflict between Russia and an expanding European superpower.

South America, Africa

On May 27, Argentine farmers began a third strike to oppose high export taxes. The government still refuses to negotiate, and these latest strikes threaten to cause severe food shortages.

Xenophobic attacks in South Africa have killed more than 50 people this month. Approximately 40 percent of the population is unemployed; more than 4 million earn less than a dollar a day. According to the bbc, South Africans are blaming foreigners for “stealing jobs and rising crime.” Many of these foreigners are refugees from Zimbabwe. Now that South Africa has become a danger zone where foreigners are beaten, women are raped, and houses are razed, some Zimbabweans are fleeing back across the border, despite continuing runaway inflation, governmental upheaval and chaos back in Zimbabwe. For more about the recent ethnic violence in South Africa, read “Black on Black in South Africa” on theTrumpet.com.

Meanwhile, the global race for African resources continues, and Japan wants in. This week, Japanese Prime Minister Yasuo Fukuda promised to increase trade with Africa, doubled developmental assistance to Africa to $1.8 billion per year, and offered $4 billion in loans to Africa at concessionary terms. Also, the Japanese government is creating a $2.5 billion fund to stimulate African investment in the private sector.

Anglo-America

The destruction and tragic death toll in the wake of China’s recent earthquakes has scientists speculating that Southern California could soon experience a quake of the same magnitude. On May 22, the U.S. Geological Survey and the California Geological Survey released a study evaluating the likely effects of the “Big One.” The study involved approximately 300 scientists, government workers, emergency responders and industry experts. It considers the devastating results of a 7.8-magnitude earthquake jolting the surroundings of the San Andreas Fault—an 800-mile boundary where the Pacific and North American plates grind against each other. An earthquake along this fault killed an estimated 3,000 people in 1906. The Associated Press reports, “The ‘Big One,’ as earthquake scientists imagine it in a detailed, first-of-its-kind script, unzips California’s mighty San Andreas Fault north of the Mexican border. In less than two minutes, Los Angeles and its sprawling suburbs are shaking like a bowl of jelly.” Such a tremor would last three minutes and cost $200 billion and 1,800 lives—tolls similar to Hurricane Katrina and September 11.

In Britain, vociferous and ill-founded self-loathing reached a feverish peak when Briton George Galloway delivered a public address in Jordan, aired on Al-Jazeera tv on May 15. Galloway said, “I have for 21 years sat in the British Parliament, the scene of many crimes. I had to sit in the same room for many years as Mr. Tony Blair …. Not since Caligula made his horse a minister has there been a more inappropriate appointment as the appointment of Tony Blair as the peace envoy to the Middle East. He’s dripping with the blood of the people of Iraq, of the people of Palestine, of the people of Lebanon ….” George Galloway is not a Muslim preacher; he is a member of Parliament. Known as the “mp for Baghdad North,” Galloway added,

In this case, the victims of terrorism are called the terrorists, and the terrorists are called the victims of terrorism. This terrorist state of Israel parades around the world as a legitimate government, being received as such even in some Arab countries, whilst Hamas, elected by the people of Palestine, are called terrorists, who must be starved and beaten into submission. … [A]ll my life I believed that Palestine could be liberated by the Kalashnikov and the armed struggle alone. This was a mistake. We need the Kalashnikov. We need the armed struggle. This is the hammer. But we need also an anvil … and that anvil has to be mass movements of the population, of the people. The most inspiring event, of the last—we can say—40 years, since Karameh, was when the people of Gaza, with their bare hands, in their thousands tore down the walls of their prison, and poured out of the siege into Egypt.