September 4, 2010

The Week in Review

September 3, 2010 | From

“Heroic” murder in the West Bank, Germany’s “demise,” bittersweet “victories” in Mexico, and “learning” from our mortgage mistakes.
Middle East

Hamas’s military wing, the al-Qassam Brigades, has claimed responsibility for an attack in the West Bank Tuesday that killed five Israelis—two men and two women, one of whom was pregnant. The Israelis were gunned down by terrorists in an ambush near the entrance to a Jewish settlement close to Hebron. The attack came just two days before Israeli Prime Minister Benjamin Netanyahu flew to Washington to meet with Palestinian President Mahmoud Abbas for peace negotiations, highlighting the weak political position Abbas is in. A Hamas spokesman said the attack was proof “of a failure of security coordination” between Israel and the Palestinians. The Popular Resistance Committees, an alliance of Palestinian militants formed in 2000, praised the attack, warning that Fatah “should not have gone for this move (negotiations with Israel) without the support of the Palestinian people.” Stratfor reports that “Hamas, which has been making stronger efforts in recent months to portray itself as a more credible negotiating partner, is signaling that by treating Abbas as a representative of the Palestinian people, Netanyahu is talking to the wrong man if Israel or the United States is looking for results in the Israeli-Palestinian conflict” (August 31). In carrying out the attack, Hamas is attempting to undermine Fatah and boost its own standing in the West Bank.

In additional proof that the Gaza Strip has become an incubator for various terror groups since Israel’s pullout five years ago, an 11-member terrorist cell headed by a Gaza-based Palestinian Authority Arab has been captured in Morocco. Yahya al-Hindi is a former member of the Islamic Jihad terror organization and is responsible for having built a global jihad network in Gaza that serves as a regional “exporter of terrorism,” according to Al-Hindi’s group is aligned with al Qaeda, from whom he gained training in Afghanistan, along with Taliban operatives, in 2007.

Lebanese Druze leader Walid Jumblatt has met with the Iranian ambassador to Lebanon for the first time in five years, with the aim of turning over a new leaf in relations with Iran, Lebanon’s Al-Safir reported Tuesday. Jumblatt has already backed away from his traditional hostility toward Syria. A year ago, we wrote, “It is most likely that Jumblatt is moving away from Lebanon’s pro-Western forces in favor of Iran, Syria and Hezbollah because he senses momentum swinging in the direction of the latter groups as America’s influence in the region wanes.” Jumblatt “has always represented a weathervane of regional politics,” said author Amal Saad-Ghorayeb. Jumblatt’s current pursuit of relations with Iran, therefore, is one more indication of Tehran’s rising influence.


A political storm over immigration is brewing in Germany, with a prominent board member of the country’s central bank at its epicenter. Thilo Sarrazin, in a new book called Abolishing Germany—How We’re Putting Our Country in Jeopardy, claims that Muslim immigrants are destroying Germany’s prosperity. In the book, Sarrazin details what he calls Germany’s “demise,” saying that constant immigration and higher birth rates among immigrants mean that Germany is “turning Muslim.” “I don’t want the country of my grandchildren and forefathers to be in broad swathes Muslim, where Turkish and Arabic is widely spoken, where women wear headscarves and where the daily rhythm of life is set by the call of the muezzins,” Sarrazin wrote in an excerpt published in Der SpiegelWelt am Sonntag, in which he said that all “Jews share a certain gene … which make them different from other people.” While most leading German politicians have taken their obligatory turn criticizing Sarrazin’s remarks, this is not his first time stirring up such debate—and surviving the backlash. Sarrazin appears to be striving to nudge the heated immigration debate into the direction of right-wing populists elsewhere in Europe, such as Geert Wilders in the Netherlands, who is gaining in popularity. For decades, Europe has been tolerant of the steady growth of Islam’s presence in society. But headlines from the last few years reveal that tolerance to be thinning. Bible prophecy makes plain that tensions between Europe and Muslims in and outside of the European Union will build and eventually culminate in a seismic blitzkrieg clash. magazine on August 22. Sarrazin stirred up additional controversy in an August 29 interview with Germany’s

The Catholic Church found itself in hot water once again this week, in both Belgium and Germany. Retired Belgian Cardinal Godfried Danneels advised a victim of sexual abuse to keep silent about his treatment until after the bishop who abused him retired. The victim was abused by his uncle, Bishop Roger Vangheluwe, for years. During a meeting with Danneels in April, which the victim recorded and recently released to the press, Danneels told him not to make the abuse public. “It might be better to wait for a date in the next year, when he is due to resign,” he said. “I don’t know if there will be much to gain from making a lot of noise about this, neither for you nor for him.” The victim responded by saying that Vangheluwe “dragged my whole life through the mud, from 5 until 18 years old,” asking, “Why do you feel so sorry for him and not for me?” On August 31, the German Catholic Church published new guidelines on how clergy should handle reports of sexual abuse. Under the new rules, the church must report all allegations of abuse to authorities so there can be no cover-up. The old 2002 guidelines simply “advised” the church to report abuses if the allegations were “proven.” However, many say the new guidelines do not go far enough. So far this year, 300 people have said they were sexually abused by priests in Germany. The rules’ critics point out that they do not state that the church has to fire any abusers. There is also no talk of compensation for victims. The Catholic Church, however, has largely weathered the abuse scandal. For more information on the Vatican’s response to these scandals, see our article “Beware! The Vatican Will Retaliate.”


As Kyrgyz nationalism intensifies, the government’s authority is unraveling, which calls into question the fate of the U.S.’s crucial Manas Air Base. Only one month after agreeing to extend a one-year lease to Washington for the base, Kyrgyz President Roza Otunbayeva began this week to back away from U.S. security programs that Washington hoped would prop up her weak government. The U.S.-supported programs include an international police mission, and counterterrorism and anti-drug training centers. Since she took office in April, Otunbayeva’s administration has been plagued by crises, most notably the June outburst of ethnic violence between Kyrgyz and Uzbeks in the south of the nation, which led to at least 400 deaths. Last week, in another devastating blow to the president’s authority, Melis Myrzakmatov, mayor of the nation’s southern city of Osh, defied an order that he resign. Myrzakmatov, who was appointed by Otunbayeva’s ousted predecessor, is a Kyrgyz nationalist who is hostile to U.S. influence in the country. Otunbayeva’s inability to control Myrzakmatov and other nationalists in the former Soviet republic bodes poorly for parliamentary elections to be held in October, which are expected to tip Bishkek’s allegiance further away from Washington. Moscow, which considers Kyrgyzstan a part of its sphere of influence, and which also has a crucial base in the country, has told Kyrgyzstan that it expects the U.S. base to be closed next year. Analysts foresee Russia exploiting Kyrgyzstan’s crisis to obtain a promise by Bishkek to shut Manas down and kick the U.S. out. Russia will use its growing leverage to steer the situation to accelerate the demise of U.S. influence in the region, and to further tip the scales of Central Asian power toward Moscow.

An increase in intra-Asian commerce and improving liquidity of Asian currencies bode well for the usage of regional currencies, and cast ominous clouds on the greenback. This week, following China’s lead, Malaysia’s central bank liberalized its foreign exchange rules to allow non-residents to convert foreign cash into its currency, the ringgit. China has also moved to allow yuan/ringgit exchanges, within a 5 percent reference band. The U.S. dollar has been the primary currency in the region for so long that it still carries weighty market advantages. “There is a lot of catching up for the regional currencies to match the parameters of the major currencies,” said Piyush Kaul, treasurer of hsbc Bank Malaysia. But dependency on the dollar is diminishing with every passing month. Gone are the days when the greenback was the only currency option for international trade.

Latin America/Africa

Mexico made a little progress in its drug war this week. Police arrested top drug lord Edgar “La Barbie” Valdez Villarreal on August 30. Villarreal was vying for control of the drug cartel Beltran Leyva Organization. His arrest is a success for the government and could provide it with much valuable intelligence about drug cartels in the region. On August 27, Juan Francisco Zapata Gallegos, head of Los Zetas in the city of Monterrey, was also arrested. Despite this progress, the usual violence continued. Drug gangs detonated two improvised explosive devices in separate vehicles on August 27 in Reynosa. The next day, three explosions injured 15 civilians in the same city. And on August 29, another city mayor, this time the mayor of Hidalgo, Tamaulipas, Marcos Antonio Leal Garcia, was assassinated. Despite the arrest of key figures, Mexico’s drug war will keep spiraling out of control as long as Americans keeps putting billions of dollars in the hands of the drug gangs through their addiction to illegal drugs.

Floods have forced nearly 60,000 people out of their homes in south Sudan, said the region’s semi-autonomous government on August 31. Malaria and other diseases could break out in its aftermath, it warned. The torrential rains have left most of the state capital of Northern Bahr el-Ghazal, Aweil, underwater. “It is not yet the end, because the rains are going to continue up until October, so the situation may get worse,” said the region’s health minister, Luka Monoja. Around 2 million people have been killed in a decades-long civil war in the area. Almost half of the 8 million people in south Sudan are thought to be short of food. The floods are just one more in a long, long line of catastrophes for the area.


The Wall Street Journal reported on Wednesday that sales by U.S. automakers plunged in August. General Motors said its sales plummeted 25 percent from the same time last year, when federal incentives such as “cash for clunkers” were propping up vehicle purchases. Ford Motor Co. sales also failed to meet expectations, down 11 percent. Japanese manufacturer Toyota also reported falling numbers as the industry felt its worst August in 28 years.

The Journal also reported Wednesday that mortgage securities backed by risky adjustable-rate home loans, the investments that became infamously toxic during the mortgage market meltdown, are back in favor with investors. The demand shows an increasing appetite for risk in the market, and perhaps a failure to learn.
Although the Pew Hispanic Center has reported a “sharp decline” in illegal immigration over the past two years, there are still major problems at the border, and even 100 miles this side of it. The U.S. government has posted warning signs along Arizona’s Intestate 8, a route that connects Tucson with San Diego and lies as much as 100 miles north of the Mexico line. The signs warn travelers that they are in an “active drug and human smuggling area” and that they may face “armed criminals and smuggling vehicles traveling at high rates of speed. A sheriff whose county lies in the middle of the corridor said his deputies are outmanned and outgunned in their own county.

Meteorologists are watching Hurricane Earl, an Atlantic storm that may hit North Carolina with Category 3 winds. The Associated Press reports that rip currents will hit the Eastern seaboard and could even cause hurricane-force winds in Long Island. Virginia has declared a precautionary state of emergency as the winds blow closer.