Tag Archive for: The Wall Street Journal

Has Qatar turned Away from Islamist Support in the Middle East?

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Yesterday, The Wall Street Journal published an intriguing analysis by Yaroslav Trofimov of the of Qatar’s apparent withdrawal from being a broker in the murky world of Middle East peace and Islamist causes, “Qatar Scales Back Role in Middle East Conflicts.”   Trofimov noted:

From mediating in Lebanon and Sudan to helping rebels in Libya and Syria and backing the Palestinian group Hamas, Qatar has been involved in virtually every Middle Eastern flash point. But, under pressure from bigger neighbors Saudi Arabia and the United Arab Emirates, it has moved in recent weeks to distance itself from its traditional posture of championing Islamist movements—particularly the Muslim Brotherhood—in Egypt and elsewhere.

“The Qataris were a little bit shaken about how much blowback they have had,” said Abdullah Baabood, director of the Gulf Studies Center at Qatar University. “The recent events show they have overstretched themselves. They will now pick their battles and focus on what serves best their strategic interests.”

Trofimov drew attention to some demonstrable turns of events in December 2014 following the dust up in March when envoys from three Arab States in the Gulf Cooperation Council (GCC), Bahrain, the UAE and Saudi Arabia withdrew their Ambassadors.  In November the UAE followed Saudi Arabia and listed the Muslim Brotherhood and affiliates Hamas,  CAIR and the Muslim American Society in the US as terrorist organizations. Trofimov noted the turnabout:

After their threats to boycott a summit of Gulf monarchies in Doha this month, Qatar revised its stance on the critical point of disagreement—how to treat the Muslim Brotherhood and the current Egyptian leadership, which ousted the Islamist group from power last year.

Having expelled several Egyptian Muslim Brotherhood leaders ahead of the summit, Qatar sent a senior envoy to Egypt on Dec. 20 to seek a rapprochement with President Abdel Fattah El -Sisi.

Two days later, Qatar shut down the Egyptian channel of its Al Jazeera TV network, an outlet for the Brotherhood and other opponents of Egypt’s current leadership.

“The security of Egypt is important for the security of Qatar,” Emir Tamim bin Hamad al-Thani said.

Earlier on December 6, 2014, we reported that the Qatari Ambassador to the US,  H.E. Mohammed Jaham Al-Kuwari at a presentation before the Pensacola, Florida Tiger Bay Club proclaimed, “We do not support Hamas”.  He astounded some in the audience.  That was in contrast to the views of Jon Schanzer of the Washington, DC-based Foundation for the Defense of Democracies who in a September 2014 Congressional hearing said, “That Qatar is currently Hamas’ ATM”.  We noted Qatar’s pledge of $1 billion to rebuild Gaza after the cease fire that ended the 50 day war in the summer of 2014. Qatar had provided a luxurious safe haven for billionaire Hamas leader Khaled Meshaal.  The Ambassador said, “Better to have Khaled Meshaal in Qatar than across the Gulf in Iran”.  But then there were other matters for example the Taliban office in Qatar that facilitated the exchange of senior commanders released from  Gitmo for US Army Sgt. Bowe Bergdahl.  Oatar had provided a long exile of anti-Semitic and anti-American Egyptian Muslim Brotherhood Preacher Yusuf al Qaradawi who coincidentally had an Interpol red tag warrant issued for his arrest and extradition to Egypt on the same day as the Ambassador’s Pensacola presentation. We cited US Treasury concerns over wealthy Qatari businessmen funding Al Qaeda affiliate Jabhat al Nusra in Syria and the Islamic State. These stood in contrast to GCC member Kuwait that had moved at US behest to shut off the spigot of such jihad donations from wealthy individuals there.  The Qatari Ambassador cited diplomatic recognition of Israel and a state office the Jewish nation had in Doha. Curiously, the other GCC member who maintains relations with Israel, Oman, apparently doesn’t support the Palestinian cause.

The Qatari Ambassador’s  presentation on December 6th in Pensacola was eclipsed by the Emir al-Thani’s appearance at a GCC summit in Doha three days later on December 9th that marked the start of a lowering of Qatar’s profile internationally reflected in Trofimov’s WSJ revelations.

There were also some fundamental economic realities; the plummeting oil and gas prices, reflecting the excess of supply over current global demand.  That resulted in hammering the revenues of oil producers like Russia, Iran and Venezuela.  There is the prospect in 2015 of the US vaulting to the forefront as both the world’s leading oil and gas producers propelled by the fracking revolution. If allowed by the Obama Administration exports of oil and gas would further weaken world prices that could result in a further drop in Qatar’s revenues.  Al Arab in a report on December 16, 2014 quoted the Qatari energy minister at an industry conference in Doha saying:

“Energy markets are interconnected, and we can see the effects of the oil price drop affecting gas too,” Mohammed al-Sada told reporters in Doha.

There was already a “strong degree of conversion of gas spot prices between different regions,” he said on the sidelines of the 16th ministerial meeting of gas exporting countries.

Oil prices have dropped by nearly 50% and natural gas prices 10% since June 2014.

Then there were still unresolved FIFA 2018 and 2022 bribery investigations of both Russia and Qatar. That has besmirched the reputation of the world football federation and its autocratic head, Sepp Blatter, following the resignation of former US Attorney Michael Garcia of the US law firm of Kirkland and Ellis, over the failure to release the final report of his investigation in bribery allegations. There have been  accusations that some of the $220 billion funds for the infrastructure  in preparation for 2022 FIFA World Cup competition  in Qatar may have involved bribes to FIFA officials and  possible  diversion of contractor payments  to fund the Jihad of the Islamic State.

Qatar’s estimated $220 billion investment in infrastructure to support the 2022 World Cup matches in its torrid climate has engendered another problem: the deaths of  nearly 1,000 foreign workers and their  near servitude-like employment and housing conditions. The Times of India in a December 24, 2014, report cited evidence of Qatar’s continuing toll of foreign workers:

A series of stories in The Guardian have shown that migrant workers from Nepal, India, Sri Lanka and elsewhere were dying in their hundreds.

While some were listed as having been killed in workplace accidents, many more were said to have died from sudden, unexplained cardiac arrest.

The government confirmed in the DLA Piper report that 964 workers from Nepal, India and Bangladesh had died while living and working in the Gulf state in 2012 and 2013.

The report recommended that Qatar do more to record and investigate the causes of death among the migrant population but it has made little outward progress.

After it was published, Qatar said it would reform the kafala system that keeps workers tied to their employer, and better enforce laws that require contractors to provide humane living conditions and ban them from seizing passports.

But the system that Qatar proposed to replace kafala would still leave workers tied to their employers for the length of their contract, which could be as much as five years.

Seasoned observers of the Middle East region say that Qatar under the two century rule by the Al-Thani family “has been punching internationally above its weight class” to use the boxing analogy. Yet Qatar has often been referred to as a Frenemy.  Not exactly a friend, not exactly an enemy.  The friend part is reflected in the forward operating base for the US CENTCOM at the al-Udeid airbase complex and multi-billion dollar purchases of weapons from US defense contractors. There was also the creation of an education hub for several US universities and the Brookings Institution Doha Middle East Research Center.  That may be winding down with status of forces agreement with the Afghanistan government and the Obama Administration ending active US combat participation in the conflict with the Taliban.  The enemy side of Qatar  had  until these latest developments been reflected in support for the Muslim Brotherhood, Hamas, Al Qaeda and Islamic State by wealthy fundamentalist Qataris.

Trofimov in his WSJ analysis cites the characterization of Qatar by a human rights critic:

Despite its rhetoric in favor of democratic change in the region, the absolute monarchy has remained just as repressive as its neighbors, said Najab al Nuaimi, the country’s former justice minister who is now a prominent human-rights lawyer.

“It is a police state. There is no democracy in Qatar. If you open your mouth, they will even strip you of your passport,” he said. “We supported directly all the uprisings, with violence, with guns—but only the Brotherhood, not the liberals.”

Thus, tiny Qatar has been forced to rein in its support of the Islamist jihadist causes because of geo-political realities, leaving Turkey’s President Erdogan as the lone supporter of Hamas in the region.  That has been  fueled by the  US energy revolution producing a glut in the weakened demand for oil and gas that precipitated  the plummeting oil and gas prices. We can thank American entrepreneurial enterprise for causing the drop in revenues to energy dependent producers like Russia, Iran and Venezuela and quickening the possible demise of OPEC.

EDITORS NOTE: This column originally appeared in the New English Review. The featured image is of Qatari Emir Tamim bin Hamad al-Thani at the Gulf Cooperation Council summit in Doha on 12-9-14. Source: Associated Press.

Geert Wilders’ NExit Plan to Leave the EU

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The Hon. Geert Wilders of the Dutch Freedom Party (PVV) is serious about the Netherlands leaving the bureaucratic morass of the EU. That would include returning to the Guilder instead of the Euro as the currency. Yesterday, he held an important news conference at The Hague and released the findings of an assessment of what the proposal would mean to the Netherlands and its citizens.

The NExit report, “Assessing the economic impact of the Netherlands leaving the European Union” was prepared by the London-based Capital Economics, Ltd. It purports to be a macro-economic analysis of the effects of exiting the EU in terms of future impacts on gross domestic product, national and personal income, as well as the costs and benefits. NExit puts gravitas behind Wilders proposal. It should be considered the opening bow shot in the upcoming May 2014 European Parliamentary elections where Wilders has already built up a head of steam in the polls in Holland. Further there are the burgeoning alliances with similar Eurosceptic parties like Vlaam Belang in Belgium and Marine le Pen’s National front in France and other parties in the EU.

We have been through the NExit report and found it professionally well done. Its methods, assumptions and findings appear credible. In light of that we find the mainstream reports, to be uniformly dour hewing to the line that polls in The Netherlands are unfavorable. In terms of the upcoming European Parliamentary elections the PVV may be in a lead position to pick up a majority of the Dutch delegation seats. Dutch opinion heretofore has allegedly been not sanguine about the PVV Euro skeptic proposals. That is until now. The NExit report puts flesh on the bones, of how the average Dutch citizen and the national economy would benefit.

Overall the Capital Economics NExit report finds “overall, the various strands of analysis point to NExit being a long term benefit to the Dutch economy and, more than likely, a short term help in easing the Netherlands out of its current economic ills”.

The Report notes that if the NExit project began in January 2015 under a so-called Swiss-like relationship between the Netherlands and the European Union the aggregate economic impacts would be:

  • Gross Domestic Product  would grow by 10 to 13 percent  by 2035 than if the country remained in the EU;
  • National Income would have increased by 1,100 to 1,500 billion Euros equivalent to 7,100 to 9.000 per house and per year.

How would these tantalizing economic benefits be achieved?   Here is what the Capital Economcs NExit report finds:

  • Costs of doing business in Holland would be reduced by a minimum of 20 billion Euros;
  • Public finance would add a cumulative 240 billion to GDP by 2035;
  • Public spending would be reduced by 7.5 billion Euros through revised immigration policies;
  • Expansion of trade with both major trading partners and emerging growth  countries;
  • Tailoring monetary and fiscal policies to the needs of the Netherlands economy add a cumulative 309 billion Euros by 2035.

Capital Economics NExit report suggests that based on its macro-economic assessment that the costs of the transition are manageable. That fears of a revaluation of the Dutch Guilder against the Euro are unfounded and the volatile swings in currency trading on a continuing basis following transition are expected to be minimal. Moreover, Capital Economics believes should have minimal impact on the country’s banking system, its sovereign debt and national pension system.

The Wall Street Journal (WSJ) report, “Dutch Nationalist Pushes for EU Exit”,  quoted Wilders saying, “Leaving the EU will restore the national sovereignty and boost our economy. It offers the Netherland a way out of the crisis. The transition costs will be temporary and manageable.” There are of course skeptics in both the Netherlands and EU who are dismissive of both Capitol Economics, the consulting group that produced the 159 page report calling the underlying assumption ‘unrealistic’.  Capitol Economics authored a 2012 report on the benefits of dismantling the Euro zone. The WSJ cited Dutch Finance minister, Jeroen Dijsselbloem saying that leaving the EU would be “very unwise” for the Dutch economy and business.

Whether the NExit report’s potentials can be realized depends on election of PVV Members in the majority of the Dutch delegation to the European Parliament in Strasbourg. Wilders is first past the post with a plan that he can point to that appears to offer a credible and highly attractive alternative to the economic stasis that the Netherlands and many leading member countries of the EU find themselves in for the foreseeable future.

EDITORS NOTE: This column originally appeared on The New English Review.

Terrorists attack CA Power Station: National Power Grid Vulnerable

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Today’s  Wall Street Journal  (WSJ) had a front page story that raises question of the vulnerability of our national power grid to terrorist attack given an incident that occurred in Silicon Valley in April 2013. It is only now surfacing  in the national media, “Assault on Power Grid Raises Alarms”.

In the early morning of April 16, 2013, the Metcalf, California transmission substation in Silicon Valley was attacked by what federal investigators believe was a highly professional terrorist team .  That sniper  assault  caused 17 transformers to crash severing power to  Internet Service Providers  and other power users in  Silicon Valley.  Pacific Gas and Electric (PG&E) was forced to  increase and reroute power to the area served by the disabled transmission station.  The recovery  took 27 days for PG&E to repair and bring  the transmission substation back online.

Grid Attack diagram WSJ 2-5-14

Graphic of timeline of Metcalf attack. For a larger view click on the image.

Here is the time line of the Metcalf incident as compiled by the WSJ:

At 12:58 a.m., AT&T fiber-optic telecommunications cables were cut—in a way that made them hard to repair—in an underground vault near the substation, not far from U.S. Highway 101 just outside south San Jose. It would have taken more than one person to lift the metal vault cover, said people who visited the site.

Nine minutes later, some customers of Level 3 Communications,  an Internet service provider, lost service. Cables in its vault near the Metcalf substation were also cut.

At 1:31 a.m., a surveillance camera pointed along a chain-link fence around the substation recorded a streak of light that investigators from the Santa Clara County Sheriff’s office think was a signal from a waved flashlight. It was followed by the muzzle flash of rifles and sparks from bullets hitting the fence.

The substation’s cameras weren’t aimed outside its perimeter, where the attackers were. The shooters appear to have aimed at the transformers’ oil-filled cooling systems. These began to bleed oil, but didn’t explode, as the transformers probably would have done if hit in other areas.

About six minutes after the shooting started, PG&E confirms, it got an alarm from motion sensors at the substation, possibly from bullets grazing the fence, which is shown on video.

Four minutes later, at 1:41 a.m., the sheriff’s department received a 911 call about gunfire, sent by an engineer at a nearby power plant that still had phone service.

Riddled with bullet holes, the transformers leaked 52,000 gallons of oil, then overheated. The first bank of them crashed at 1:45 a.m., at which time PG&E’s control center about 90 miles north received an equipment-failure alarm.

Five minutes later, another apparent flashlight signal, caught on film, marked the end of the attack. More than 100 shell casings of the sort ejected by AK-47s were later found at the site.

At 1:51 a.m., law-enforcement officers arrived, but found everything quiet. Unable to get past the locked fence and seeing nothing suspicious, they left.

A PG&E worker, awakened by the utility’s control center at 2:03 a.m., arrived at 3:15 a.m. to survey the damage.

Watch this video for the Santa Clara Police Department released in June 2013 published in the San Jose Mercury:

The WSJ noted that PG&E put out a news release saying it was “vandals” who caused the incident.  Note what former Federal  Electrical Regulatory Commission (FERC) head, Jon  Wellinghoff  uncovered after the event:

Mr. Wellinghoff, then chairman of FERC, said that after he heard about the scope of the attack, he flew to California, bringing with him experts from the U.S. Navy’s Dahlgren Surface Warfare Center in Virginia, which trains Navy SEALs. After walking the site with PG&E officials and FBI agents, Mr. Wellinghoff said, the military experts told him it looked like a professional job.

In addition to fingerprint-free shell casings, they pointed out small piles of rocks, which they said could have been left by an advance scout to tell the attackers where to get the best shots.

“They said it was a targeting package just like they would put together for an attack,” Mr. Wellinghoff said.

Mr. Wellinghoff, now a law partner at Stoel Rives LLP in San Francisco, said he arranged a series of meetings in the following weeks to let other federal agencies, including the Department of Homeland Security, know what happened and to enlist their help. He held a closed-door meeting with utility executives in San Francisco in June and has distributed lists of things utilities should do to strengthen their defenses.

A spokesman for Homeland Security said it is up to utilities to protect the grid. The department’s role in an emergency is to connect federal agencies and local police and facilitate information sharing, the spokesman said.

The WSJ article drew attention to the problem of replacing the transformers, the target of the Metcalf terrorist  attack:

The country’s roughly 2,000 very large transformers are expensive to build, often costing millions of dollars each, and hard to replace. Each is custom made and weighs up to 500,000 pounds, and “I can only build 10 units a month,” said Dennis Blake, general manager of Pennsylvania Transformer in Pittsburgh, one of  [only]seven U.S. manufacturers.

Given our work on the EMP threat to our national grid, there are 300 critical transmission substations like Metcalf that are vulnerable to such a terrorist assault. See: Interview with Jerry Gordon on The Electronic Armageddon -The … .   A rolling assault by trained terrorist  teams  against  these 300  sub stations  could  create havoc  and a shutdown of the national  grid  far in excess of the 50 million who lost power when the Northeast grid crashed in 2003.  The grid  vulnerability  is reflected in the limited  US manufacturing capacity for large Extra High Voltage (EHV) transformers.  Most of the world’s EHV transformer manufacturing capacity is located in China, South Korea and Germany.  A study by the National Academy of Sciences indicated  that  replacement of just the 300 EVH transformers from  limited US and offshore producers could take upwards of a decade. Further national security concern is the more than 100 military bases  connected to these vulnerable civilian grids. The WSJ article also illustrates the underlying problem of utility industry opposition to HR 2417: Shield Act sponsored by  Rep. Trent Franks (R-AZ) which would set standards including provision for standby replacement transformers. Based on work of the  Congressionally chartered EMP Task Force a thin shield for the national grid might cost $200 million, while a more robust program could run between $10 to $20 billion.  The impact on electric utility users would be an increase in electrical rates per user of less than $.20 cents per annum.

The  North American Electric Reliability  Corporation (NERC), the principal electric utility standard setting organization,  has opposed passage of the Shield Act calling the network “resilient”.  Au contraire  says  an official of Electric Power Research Institute (EPRI) cited by the WSJ: “The breadth and depth of the attack was unprecedented” in the U.S., said Rich Lordan, senior technical  executive. “The motivation”, he said, “appears to  be preparation for an act of war.”  When we checked the websites of House Energy and Commerce Committee  Chairman  Fred Upton (R-MI ) and  Energy and Power Subcommittee Chairman Ed Whitfield (R-KY) their major concerns as regards the security of the grid is vulnerability to cyber attack.  According to the WSJ  retiring  House Energy and Commerce Ranking Member Henry Waxman (D-CA) raised concerns  about the lack of federal  authority to undertake protective actions regarding the safety of the national grid during FERC oversight hearings in December 2013.

Whether it is  a terrorist attack like the Metcalf substation incident, the threat of a massive geo –magnetic storm during   or an EMP caused by either North Korea or Iran , this latest WSJ report should embolden US taxpayers and electrical users to request serious  Congressional  consideration of HR2417: The Shield Act .   If any of those events occurred  that would  bring us back to pre-industrial times. If that occurs, the estimates are that more than 200 million Americans could succumb to a  pandemic  virus from lack of food, water, sanitation  and  medical treatment caused by the breakdown of industrial , transportation and communications networks.  If you are concerned about this lack of security of the national  grid, you should consider signing a petition requesting Congressional consideration of the Shield Act , here.

Listen to this August 2012 Electronic Armageddon Rob Schilling Radio Show interview with Jerry Gordon.

EDITORS NOTE: This column originally appeared on The New English Review.