Fail Britannia?

Fail Britannia?

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If the United Kingdom collapses, it will be impossible to stop America from crumbling too.

Addicted to debt and devoid of industry, Great Britain faces economic catastrophe. But if Britain crashes, it will not crash alone. It won’t be the story of an isolated island fading into history, but of 200 years of Anglo-Saxon dominance coming to an abrupt end.

Even though it’s not even on the radar screen for most Americans, Great Britain is headed toward a debt crisis, and thus a currency crisis. On January 8, the Telegraph reported that Neil Woodford, head of Invesco Perpetual, said there was a “high probability” of Britain losing its aaa credit rating—something that has never happened before.

Taken alone, Mr. Woodford could be passed off as a doom-and-gloomer. But he is far from alone. Just days earlier, pimco, the world’s biggest bond house, declared it was selling its UK government gilts (government debt). According to pimco, there is an 80 percent chance that the British government will face a credit rating cut. If that happens, UK government bonds will plunge in value, so pimco is getting out while it can.

Floundering in its worst depression in 80 years and facing its biggest budget and trade deficits ever, it’s surprising Britain hasn’t had its national credit rating cut already. Some blame the credit rating agencies for being corrupt; others argue that they are incompetent. But the truth is that it is no easy thing to downgrade one of the largest economies in the world toward junk status. Trillions of dollars hang on a few paragraphs in a report. In actuality, Standard & Poor’s and the other major credit agencies have warned multiple times that unless the government does something to cut the deficit and fix the economy, Britain’s aaa rating will be removed.

It is one thing for Greece or Iceland to get its credit rating cut. It’s quite another when you are talking about the world’s fifth-largest economy and its biggest banking center. The ramifications could be catastrophic to the global economy.

If Britain were to lose its rating, it could force many investors and pension plans to sell their UK government debt bonds. The cost of UK government borrowing could skyrocket—the last thing Britain needs right now. As it is, the nation is trying to borrow record amounts from foreign investors to pay its bills and revive its economy.

To make up the shortfall, the British central bank is creating money out of thin air to lend to the government. The euphemism used by central bankers and politicians for this money printing is “quantitative easing.” If the term sounds familiar, it’s because that is the same process the United States is embarking on. It’s also what Zimbabwe, Argentina and Weimar Germany have embarked upon in the past.

Already investors seem to be anticipating a UK default—not just by inflation, but an outright default. The cost to insure British government debt against default is only slightly less expensive than covering Portugal. Projections indicate that the UK will need to borrow or electronically create another $1.13 trillion over the next five years—an incredible amount for an economy one fifth the size of the U.S. If the economy doesn’t improve, Britain may need to come up with a lot more. The borrowing could take the UK national debt to almost 100 percent of gross domestic product by 2014—a level that many economists and many market movers consider the “point of no return” for an economy.

“Countries can run up as much debt as lenders will allow,” notes economic analyst Jim Jubak. “And right now the signs are that lenders are getting nervous about keeping the tab running for the United Kingdom.”

If lenders stop providing the easy money to the UK government, then the pound could be in for a serious fall—not the relatively minor 29 percent fall it has had against the euro since the current economic crisis began. If the foreign money dries up, then it will be off to the racetrack for the printing presses, with the finish line somewhere in banana republic land.

To this point, some UK politicians and economists actually look at the pound’s devaluation as a positive, saying it helps make UK exports more competitive. The reality is that Britain doesn’t export much. Its manufacturing industry—once the prize of the world—is decayed and largely gone. Even with the pound plummeting, the trade deficit has barely improved. Britain is still a major importer from everything from food to fuel. And with the pound falling, the costs of all these imports are going up. Not a good recipe for higher consumer spending and a lasting recovery.

Pound sterling is headed for another rout—the only question is when.

But if the UK is in trouble, America might not want to look in the mirror. According to Jubak, America had better hope that Great Britain can work its way out of its bind without a full-scale financial crisis. “The last thing I want is a crisis that would focus everyone’s mind on how similar the budget picture looks here,” he says.

Yes the similarities between America and Britain are everywhere: Massive debt, shaky currency, lost industry, chronic trade imbalances, corrupt politicians, broken trust.

On January 14 the Wall Street Journal revealed that California’s bonds are now rated by insurers as riskier than those of Kazakhstan. California, if it were a stand-alone country, would have the 10th-largest economy in the world. Arizona, Illinois, Kentucky and Virginia may be in just as poor shape as California. As for pimco, the bond fund with over a trillion dollars under management, it has announced it is paring down its holdings of U.S. government debt too—reducing its risk that the U.S. government could soon face a credit rating downgrade just like Britain.

“There will, before long (my best guess is between two and five years from now), be a global dumping of U.S. dollar assets, including U.S. government assets,” says former Bank of England policy maker Willem Buiter. “Old habits die hard. The U.S. dollar and U.S. treasury bills and bonds are still viewed as a safe haven by many. But learning takes place.”

“The past eight years … [have] left the U.S. materially weakened financially, economically, politically and morally,” he said. “Even the most hard-nosed … indifferent potential foreign investor in the U.S. must recognize that its financial system has collapsed.”

Genetically, America and Britain’s plight couldn’t be more similar—and precarious. As the great banking meltdown of September 2008 revealed, America’s and Britain’s economies are tied at the hip.

The history of the United States and Britain is unique in the world. They have a blood-brother-like relationship. In the past, during times of great national crisis, that relationship has worked for good, with one supporting the other.

Today, however, the opposite is occurring. The bonds of brotherhood, the special relationship and spirit of cooperation between these two countries have broken down. Now the global economic crisis, which started in America, looks set to wreck Britain. And when Britain goes down, it can’t help but drag America with it.

To read more about the special relationship between the U.S. and the UK, and why these two countries are destined to fall together, read the book The United States and Britain in Prophecy. It will open your eyes as to why America and Britain are plagued by so many of the same problems and will reveal the solution to the crisis these two nations face.

China and Taiwan Enter a New Phase of Economic Partnership

China and Taiwan Enter a New Phase of Economic Partnership

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Will Taiwan’s strides toward China lead to its annexation?

On January 16, Taiwan and China entered into a new phase of economic partnership when three long-awaited policies went into effect which liberalize financial ties across the Taiwan Strait.

The three memorandums of understanding, first signed in November by Chairman of Taiwan’s Financial Supervisory Commission Sean Chen, allow financial institutions in China and Taiwan to open new liaison offices, and upgrade existing offices into branches, opening doors for both sides to enter each other’s markets.

Since Taiwanese President Ma Ying-jeou took office in May 2008, Taipei and Beijing have made a series of cross-straight deals, and now the two governments are fast-tracking negotiations to bring about a bilateral free-trade agreement. To make up for its having entered the Chinese market comparatively late in the game, Taiwan is also working toward an economic cooperation framework agreement with China.

While both countries have economic reasons to push for a complete free-trade agreement, such deals are never about economics alone. The stakes are significantly higher for both Beijing and Taipei than the negligible tariff reductions that will directly result from the agreements.

Chief among Beijing’s motivations is the desire to increase its influence over Taiwan by making it more economically dependent upon China. The Chinese are committed to bringing Taiwan back into the fold, and will do so by military action if necessary. But the close relationship between Taiwan and the United States has so far deterred China from using such force. Instead Chinese leaders are trying to win Taiwan back gradually through social, political and economic methods.

Taiwan perceives the closer relations with China as a step toward developing the freedom to bolster ties with other countries—ties which could help Taiwan resist China in the future, as it knows the U.S. support it has depended on since 1949 is less reliable every month. But a boost in Taiwan-China relations will prove counterproductive in protecting Taiwan’s freedom.

Herbert W. Armstrong, editor in chief of the Trumpet’s predecessor, the Plain Truth, predicted Taiwan’s fate over 50 years ago. In a letter dated Sept. 19, 1958, he wrote, “Will Red China invade and capture [Taiwan]? In all probability, yes …. The Red Chinese ‘save face,’ and the United States, with many American troops now on Taiwan, will again lose face!”

The warming relationship between China and Taiwan is a step toward the realization of this prediction. Taiwan’s desire to increase ties with China will only hasten Taiwan’s loss of freedom, and America’s loss of face.

As editor in chief Gerald Flurry wrote in August 1998, “These 21 million [Taiwanese] people are going to be forced into the Chinese mold; and it is going to happen for one reason: because of a pitifully weak-willed America.”

Germany’s Political Crisis

Germany’s Political Crisis

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Germany’s governing coalition is caught in a crisis that may lead to a dramatic change in the form and style of governance in Europe’s most powerful nation.

In a metaphor for the state of her governing coalition, Chancellor Merkel was recently forced to change offices within what has been described as Berlin’s “ramshackle” Chancellery building. “A former site manager told [Der Tagesspiegel] the enormous building is ‘full of cracks’” (The Local,January 17). A more apt description of Merkel’s own government could hardly be imagined.

Following the German election on September 27 last year, the Trumpet forecast that Chancellor Merkel would face difficulty on two fronts: first, the incompatible personalities and ideologies of her vice chancellor, Guido Westerwelle, and Defense Minister Karl-Theodor zu Guttenberg; and second, Germany’s deep-seated economic challenges and the war in Afghanistan.

Barely three months into its shaky existence, Chancellor Merkel’s coalition government is breaking apart. Crisis looms for the chancellor. Party members bicker within a rising stream of criticism over Merkel’s hands-off style of coalition leadership. The whole scenario is, as predicted, exacerbated by the huge ideological disparity between her vice chancellor, Westerwelle, and prominent minister of defense, Guttenberg.

Added to this is Germany’s insecure financial state and a strong euro hitting Germany’s export-based economy hard amid deep party divisions on tax policy. Then there’s the war in Afghanistan, with the German military elites push for the Bundeswehr’s role to be more clearly and assertively defined meeting resistance from Merkel’s coalition partner, the Free Democratic Party (fdp).

As Chancellor Merkel fights to preserve her political influence, one source opined, “The more her status as chancellor wanes, the more dangerous things will get for Merkel. Her rivals haven’t given up. They’re just waiting in the wings” (Berliner Zeitung, January 11). Seizing on the chancellor’s poor showing in recent poll ratings, the Telegraph ran an article under the headline, “Most Germans are unhappy with Merkel.” “A majority of Germans see Chancellor Angela Merkel as a weak leader, a poll has suggested, as a bitter row over tax cuts and fiscal discipline in Europe’s biggest economy rocked her ruling coalition,” it said (January 15).

The Chancellery has even had to deny rumors of Merkel actually quitting office. “Rumors about Merkel’s resignation are just pulled out of thin air,” government spokesman Christoph Steegmans explained (Reuters, January 15). Reuters reported that it was unclear where the rumors originated. But, as the old saying goes, where there’s smoke, there’s fire.

These problems will dog Angela Merkel during what increasingly appears to be the waning days of her leadership. Her first term in office was in essence blessed more for a whole raft of propitious coincidences that played to her favor, than for any real strength of distinctive leadership ability. The chancellor now faces the most formidable test of her political career as forces that have largely hidden behind the scenes now seize the moment of a Germany in crisis to begin to assert their influence.

These forces are significantly Roman Catholic, elitist and strongly nationalistic, committed to propelling Germany forward into a hegemonic imperialist mode, leading the European Union into a globally dominant role.

Our readers will be well acquainted with the Trumpet’s persistent forecasting that a coming crisis in Germany will cause a change of mindset not only within German politics, but also within the whole German nation. Under crisis, Germany, since unification under Bismarck, always reverts to type. It did so in 1871, in 1914 and, most recently, in the 1930s. Perceptive historians recognize the origins of today’s Germany in the ancient nation of Assyria. They can track the habitual rise, under certain conditions, of the spirit of nationalism and militarism—a spirit deeply embedded in the German psyche—throughout the history of these powerful people from the time of ancient Nineveh and the Assyrian empire on through that nation’s dominance of the various resurrections of the Holy Roman Empire. Our booklet Germany and the Holy Roman Empire summarizes this history.

So great is the crisis of leadership in the German government that the chancellor called a behind-closed-doors meeting with her coalition leaders for Sunday, January 17.

Some months before last year’s federal election in Germany, our editor in chief told our audience to “watch the September 27 election this year in Germany. It could very well produce the political leader of the Holy Roman Empire—and through devious means. The Bible prophesies that this man will come to power with deceit and flatteries.”

Should Germany’s present political crisis result in the coalition government becoming literally unworkable, it could destroy Angela Merkel’s chancellorship and result in representation to the German president, Horst Kohler, to appoint a leader to mind the governance of the country till an alternative government can be elected. Such a situation would lend itself to presidential appointment of the only bright and shining political star in Germany, the very man the Trumpethas urged its readers to watch, Germany’s most popular politician: Karl-Theodor zu Guttenberg, baron of the Holy Roman Empire.

There is something else to watch in the midst of Germany’s current political crisis: the Christian Democratic Union’s (cdu’s) sister party, the Bavarian Christian Socialist Union (csu). The junior partner of the cdu/csu alliance, the csu has played mediator in numerous spats between the cdu and fdp since Merkel cobbled this unwieldy coalition together. After Edmund Stoiber stepped down as party leader in 2007, csu popularity slumped 25 percent, with the party exhibiting its worst result ever in the 2008 Bavarian state election. The party even had to bring back Stoiber—himself being far from a spent force, politically—to the hustings to rev up support just prior to that election.

The csu is currently governing Bavaria in coalition with the fdp, an uncomfortable partnership. Should support for the csu continue to wane in Bavaria—the traditional base of Germany’s right-wing Roman Catholic support—we may yet see another leadership change at the head of the party. There are whispers that the Bavarian Baron Guttenberg would jump at the offer. Both Stoiber and his mentor, Franz Josef Strauss, separately held the csu leadership while concurrently fulfilling federal ministerial portfolios.

As our editor in chief has highlighted in the February edition of the Trumpet magazine, Guttenberg is the man to watch in Germany as the vacuum for real leadership of the imperialist European Union continues in the wake of the recent appointment of a political non-entity as its president. Ever since the nation of Germany was united under Bismarck, history has shown that whoever emerges as the dominant leader in Germany will, in turn, dominate European politics.

The admonition to watch Guttenberg’s rising star can only be strengthened in the wake of Germany’s current political crisis as Chancellor Merkel’s star wanes. We repeat Gerald Flurry’s admonition: Continue to watch Karl-Theodor zu Guttenberg, baron of the Holy Roman Empire!

The Week in Review

The Week in Review

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The King David administration, Yemen’s global terrorist cleric, and a terrorist plot-in-progress against the United States.

Middle East

A pottery shard from the remains of a town dating from the 10th century b.c. has been proven to be written in ancient Hebrew—making it the oldest known Hebrew inscription. Prof. Gershon Galil of the Department of Biblical Studies at the University of Haifa translated the text, concluding that it is indeed Hebrew as it uses verbs found only in the Hebrew language and material only relevant to an Israelite culture. “It can now be maintained that it was highly reasonable that during the 10th century bce, during the reign of King David, there were scribes in Israel who were able to write literary texts and complex historiographies such as the books of Judges and Samuel,” said Galil. The shard was discovered a year and a half ago in an excavation led by Prof. Yosef Garfinkel inside a fortified town near the valley of Elah, where David battled Goliath. Galil said that the impressive fortifications as well as the complexity of the text refute theories that the kingdom of Israel did not exist at that time. This is yet another piece of evidence showing the Bible’s history of Israel is true and modern revisionists’ histories false.

In Yemen, Sheikh Abdul Majeed al-Zindani, with the support of a council of 150 clerics, on Thursday delivered a fatwa, or religious decree, against any foreign political or military intervention in the country. In his pronouncement, the sheikh stated, “If any party insists on aggression, or invading the country, then according to Islam, jihad becomes obligatory.” Stratfor asserts that the decree is a warning by Yemen for the United States to back off from taking any overt military action there. Although al-Zindani has been labeled a specially designated global terrorist by the U.S. and is also one of Osama bin Laden’s spiritual mentors, in Yemen he is a well-known and respected religious and political figure and maintains close ties with Yemeni President Ali Abdullah Saleh. For this reason, Stratfor believes the fatwa was most likely at least tacitly approved by Yemen’s president. “Ultimately, the fatwa delivered by al-Zindani sends a direct message to the United States, and perhaps Saudi Arabia, that any increase in foreign military presence in the country is ultimately forbidden and could be met with religiously sanctioned violence” (January 14).

Iran is making headway in securing political influence in Iraq ahead of March parliamentary elections. Iraqi Prime Minister Nouri al-Maliki’s State of Law coalition has announced it will enter into an alliance with the Iraqi National Coalition (inc), which was formed last August by Iran’s allies in Baghdad in order to cement Iranian political influence in the country. When the inc was first formed, Maliki refused to join the Iranian-backed political alliance. When Iranian troops occupied an Iraqi oil well in December, we reported that, in part, it appeared to be an attempt by Tehran to put pressure on Maliki to align with the inc. “He could either use the incursion to play the nationalist card and paint his political rivals in isci [Islamic Supreme Council of Iraq, the main party in the inc] as Iranian stooges, or he could avoid any Iranian backlash and simply fall in line with Tehran’s wishes” (Stratfor, January 12). It appears that Maliki has now caved to Iran. The announcement that his State of the Law will ally with the inc after the elections came shortly after Iran’s foreign minister visited Iraq and met with Maliki and Iraq’s highest-ranking Shiite cleric, Ayatollah Ali al-Sistani.

Europe

A joint Israeli-German cabinet meeting will take place on January 18 in Berlin, according to an Israeli government official. It is the second meeting of this kind, the first having been held in Israel in March 2008. The session between the two governments is to be chaired by Israeli Prime Minister Benjamin Netanyahu and German Chancellor Angela Merkel, who are expected to focus on the Iranian nuclear threat, and bolstering political, economic and security relations between Jerusalem and Berlin. Ten senior ministers from each country’s government will attend the meeting. The upcoming joint Israeli-German cabinet meeting further indicates that the Jewish people will continue to place their hope and trust in Germany. History and Bible prophecy agree that it will lead to a disastrous result. To understand where this German-Israeli relationship is leading, read our August 2008 Trumpet article “Can Israel Trust Germany?

Italy is experiencing some of its worst racial violence since World War ii. Over 1,000 African immigrants were evacuated from the southern Italian town of Rosarno on January 9, after three days of clashes that left 53 people injured—18 of whom were policemen. The clashes began after some local residents attacked immigrants, causing the immigrants to run riot. An anti-government newspaper called the removal of the immigrants “ethnic cleansing.” As the economy gets worse, and Europe shifts to the right, watch for racial violence to increase.

Asia

China successfully tested its first land-based missile-defense system on Monday with the goal, in part, of deterring the U.S. from its defense of Taiwan. By destroying one in-flight missile with another, Beijing flexed its growing military muscle, and also displayed its disapproval for the recent sale of 200 U.S. Patriot interceptor missiles to Taiwan. Beijing has threatened military action in the event of Taiwan’s pursuing formal independence, and Taipei would use the weapons to thwart any attack by Chinese missiles positioned just across the Taiwan Strait. Although the test of itself will not persuade the U.S. to withdraw its support of Taiwan’s self-defense, it highlights the growing tensions between Beijing and Washington. The rift is expected to widen in coming weeks as President Obama meets with Beijing’s Tibetan enemy, the Dalai Lama, and when Washington hosts a visit from Taiwanese President Ma Ying-jeou.

Latin America/Africa

Hundreds of thousands of people may have been killed by a 7.0 magnitude earthquake that hit Haiti on January 12. Within a few days, law and order appeared to break down. Thousands are left homeless, and disease seems ready to rampage through the nation’s capital of Port-au-Prince.

Militants attacked a bus transporting Togo’s soccer team African Cup of Nations on January 8. Six or seven people were injured. The attack raised questions of whether similar attacks could take place in South Africa when it hosts the World Cup in summer 2010. Sports teams are increasingly becoming a target for militants, and the World Cup could be a way for them to push at Western nations.

Anglo-America

The White House announced late this week that al Qaeda in the Arabian Peninsula (aqap) was conducting an ongoing terror plot against the United States. aqap was responsible for sending Nigerian Umar Farouk Abdulmutallab to suicide-bomb Northwest Flight 253 over Detroit December 25. Abdulmutallab said that many more like him were headed to the U.S. from Yemen. Stratfor sources also said that two suspected of plotting terrorist attacks are currently being pursued.

U.S. President Barack Obama announced Thursday that he wants to recover about $90 billion by 2010 from 50 large financial firms that were bailed out by taxpayers. Obama said he wanted to recover “every single dime” through a new tax. “My determination to achieve this goal is only heightened when I see reports of massive profits and obscene bonuses at some of the very firms who owe their continued existence to the American people.” The display of massive, irresponsible spending by banks, the government and everyday citizens shows that the state of the American economy and its ever expanding government is beyond repair.

The U.S. will face a dollar crisis if it does not either raise more taxes or cut spending, a panel of financial experts said Wednesday. “It has got to be done. It will be done some day. It may be done with enormous pain. Or it may be done more rationally,” said Rudolph Penner, chairman of the Committee on the Fiscal Future of the United States. Penner formerly headed the non-partisan Congressional Budget Office; his comments came at the conclusion of a two-year study.

Iraqi Prime Minister Caves to Iran

Iraqi Prime Minister Caves to Iran

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Iranian interference in Iraq runs high as elections near.

The Iraqi prime minister has indicated a desire to align politically with Iran, revealing that Tehran is making headway in securing political influence in Iraq ahead of March parliamentary elections.

Iraqi Prime Minister Nouri al-Maliki’s State of Law coalition has announced it will enter into an alliance with the Iraqi National Coalition (inc), formed last August by Iran’s allies in Baghdad in order to secure Tehran’s political interests in the country, according to security consultancy firm Stratfor. In making the announcement, an official in Maliki’s Islamic Daawa party, the main party in State of the Law, explained that “a single bloc cannot form a government. Coalitions with other blocs are therefore necessary.”

“Maliki’s Islamic Daawa Party is using the pretext of coalition politics to justify its decision align with inc, which is led by Ammar al-Hakim’s Islamic Supreme Council of Iraq (isci),” says Stratfor. “But there is no hiding that the development of this coalition is the result of Iranian efforts to maintain a dominant position in Iraq” (January 12).

When the inc was first formed, Maliki refused to join the Iranian-backed political alliance. When Iranian troops occupied an Iraqi oil well in December, we reported that, in part, it appeared to be an attempt by Tehran to put pressure on Maliki to align with the inc. “He could either use the incursion to play the nationalist card and paint his political rivals in isci as Iranian stooges, or he could avoid any Iranian backlash and simply fall in line with Tehran’s wishes” (ibid.).

It appears that Maliki has now caved to Iran. The announcement that his State of the Law will ally with the inc after the elections came shortly after Iran’s foreign minister visited Iraq and met with Maliki and Iraq’s highest-ranking Shiite cleric, Ayatollah Ali al-Sistani.

Meanwhile, as the parliamentary elections near, Iraq’s Shiite-dominated government has begun banning Sunni politicians from running, claiming they have ties to Saddam Hussein’s Baathist regime. Last week, Maliki banned at least 15 political parties from contesting the elections. “It seems evident that Iran’s Shiite allies are involved in—if not behind—the move to sideline key Sunni leaders and their followers in the election,” reports United Press International. This too will help ensure Iranian-backed Shiite politicians are successful in the elections—not to mention a sharp rise in violence.

Iran’s interference in Iraq is continuing in other areas too. Stratfor sources indicate that Tehran may be trying to gain official recognition of its control of the disputed Shatt al Arab waterway, which forms the border between Iran and Iraq. The crucial waterway provides Iraq’s only access to the Persian Gulf. “Iranian ships have navigated the entire waterway with impunity since the Iran-Iraq war,” reports Stratfor. “Now, Tehran wants Baghdad’s official recognition of Iranian rights to the Shatt al Arab, amounting to another symbolic demonstration of Iranian clout in Baghdad” (ibid.).

As Stratfor comments, the Iranians “have entrenched themselves in the Iraqi political, economic and security landscape and are taking advantage of Washington’s decreasing focus on the Iraq war” (ibid.). This is a trend the Trumpet has been pointing to for some years. For details on the significance of this, refer to “When America Leaves Iraq …” and “Is Iraq About to Fall to Iran?

Bill Clinton’s Statue Is in Kosovo

Bill Clinton’s Statue Is in Kosovo

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But who’s really responsible for the breakaway republic?

In November, former U.S. President Bill Clinton attended the unveiling of an 11-foot bronze statue of himself before a large crowd of cheering Albanians in downtown Pristina, the capital of Kosovo.

“I am profoundly grateful that I had a chance to be a part of ending the horrible things that were happening to you 10 years ago,” Clinton said in front of the adoring crowd, referring to nato’s 1999 bombing campaign against Serbia. The U.S.-led campaign forced Slobodan Milosevic’s army to evacuate its sovereign territory in the province of Kosovo, effectively paving the way for Kosovo’s secession.

nato, we should note, was established in 1949 as a defensive alliance among 10 European nations, the United States and Canada. Under terms of the alliance, nato members agreed to defend any member state invaded by an enemy nation.

In October 1998, however, nato “expanded” its mandate to include missions that would extend “freedom” and “human rights” throughout Europe—even if it meant going beyond the boundaries of nato member states.

Like Kosovo, for example.

With its newly revised mandate, nato immediately set its sights on Serbia, which had been cracking down on separatist forces in Kosovo throughout 1998. This culminated in the 78-day aerial campaign that President Clinton authorized in early 1999.

It is, however, Germany that is responsible for both starting and ending the war in Kosovo. From the beginning of Yugoslavia’s dissolution, the German government covertly supplied separatist forces in Kosovo, known as the Kosovo Liberation Army (kla), with military intelligence, training and weapons. The kla had also been linked to the Albanian mafia and various Islamic terrorist groups, including Osama bin Laden’s al Qaeda.

“Without any questions,” the kla is a “terrorist group,” said President Clinton’s special envoy to the Balkans, Robert Gelbard, on Feb. 23, 1998. “The future of Kosovo is within Yugoslavia,” Gelbard added, after meeting with Yugoslav President Slobodan Milosevic for several hours. The Clinton administration set up the Belgrade meeting with Milosevic to inform him that the United States was ready to reward Yugoslavia for its “good will” in implementing the peace accords the U.S. had brokered in 1995. Milosevic took that as his cue to stamp out the separatist rebellion in Kosovo.

Then, practically overnight, America—after being pressured by Germany—hung Milosevic out to dry.

Just three weeks after the Belgrade meeting, the State Department accused Milosevic of ethnically cleansing Albanians from Kosovo. President Clinton threatened the use of force against Serbia if violence in Kosovo didn’t simmer down.

When asked by Congress if he still considered the kla a terrorist group, Gelbard told lawmakers that while the kla had “committed terrorist acts,” it had “not been classified legally by the U.S. government as a terrorist organization” (emphasis mine throughout).

They committed acts of terrorism, but were no longer terrorists!

“Unfortunately and tragically, terrorist acts have occurred,” said Gelbard, “and they have provided an excuse for Milosevic here. But, as I said, there is no question at all that the overwhelming, brutal, repressive, despicable violence—the criminal actions, I believe, committed by the Federal Republic of Yugoslavia here—are responsible for the tragedy we have at hand right now.”

Three weeks earlier, there had been no question that the kla was responsible for the violent unrest in Kosovo. Now, no question, it was Milosevic.

Germany, the kla’s primary state sponsor, had spoken. And the United States abruptly switched sides in the Balkan conflict.

A few days before Gelbard’s flip-flop at the congressional hearing, the so-called “contact group” of Germany, Britain, France, Italy, Russia and the United States met for an emergency meeting in London to discuss Kosovo. During the meeting, the group of six decided to punish the Milosevic government with sanctions intended to pressure Yugoslavia into granting broad autonomy to the Albanians in Kosovo.

This, just two weeks after an American envoy assured Milosevic that the future of Kosovo is within Yugoslavia!

“This time, we must respond before it is too late,” said U.S. Secretary of State Madeleine Albright. “When the war in the former Yugoslavia began in 1991, the international community did not react with sufficient vigor,” she remembered.

Of course, as our regular readers know, it wasn’t the international community’s failure to act in the Balkans that caused war to break out in the former Yugoslav republics. It was our failure to stand up to Germany (and the Vatican) after it insisted on moving forward to recognize Slovenia and Croatia, despite strenuous protests (initially) from the United States, the European Union and the United Nations.

As much as the U.S. might want to forget about this history, the new, German-backed breakaway states haven’t forgotten. In 1993, for example, Croatia erected a bronze statue in honor of German Foreign Minister Hans-Dietrich Genscher, the first diplomat to recognize Croatian independence.

According to the Associated Press, the onetime foreign minister “championed Croatia’s independence in 1991 and pushed a hesitant Europe to recognize its secession from federal Yugoslavia” (June 3, 1997).

Kosovo’s 2008 declaration of secession was merely the final chapter of Germany’s Balkan conquest. Besides disempowering its traditional enemy Serbia, “Berlin was able to successfully reassert its claim as hegemonic power in Southeast Europe,” wrote German-Foreign-Policy.com.

There may be a bronze statue of President Clinton in Kosovo commemorating the American firepower that ousted Milosevic from his former Yugoslav republic. But Germany is the one responsible for the breakaway.

This is why, when they declared their independence in 2008, Kosovars waved German flags alongside their American counterparts.

And this is why, on one of the banners celebrating Kosovo’s proclamation, it read, “Thank you Germany!”