Layers of Incompetence

William F. Buckley analyzes George Tenet's media performance in defense of his recently released please-don't-blame-me memoirs and discovers the former CIA director to be a perfect example of why the U.S. finds itself in the current mess.

The testimony reveals the CIA run by a man who cannot think straight, advising the national security adviser, who went on to make false allegations, and the vice president, who made more false allegations, and the president, who took ill-considered actions.

Tenet's reign over the CIA experienced two of the worst intelligence failures in American history - the failure to detect the 9/11 plot, and the erroneous intelligence that was used by the Bush administration to make a case for the disastrous Iraq invasion. His record of failure was rewarded with Medal of Freedom. Given President Bush's track record of hiring and promoting incompetents - Rumsfeld, Gonzales, Rice - the fact that he kept Tenet on at the CIA, even after 9/11 shouldn't be surprising.

Frightening, but not surprising.

Venezuela's Downward Spiral

To absolutely no one's surprise, Hugo Chavez continues his march toward the economic ruin of Venezuela:

CARACAS, Venezuela (AP) --Venezuelan President Hugo Chavez on Thursday threatened to nationalize the country's banks and largest steel producer, accusing them of unscrupulous practices.

"Private banks have to give priority to financing the industrial sectors of Venezuela at low cost," Chavez said. "If banks don't agree with this, it's better that they go, that they turn over the banks to me, that we nationalize them and get all the banks to work for the development of the country and not to speculate and produce huge profits."

Chavez also warned the government could take over steel producer Sidor, which is majority controlled by Luxembourg-based Ternium SA.

In a free economy, banks have no obligation to provide low cost financing to anyone. They do have an obligation to make investments that benefit the their owners, shareholders and insure a good return for their own investors and depositors, which means they had better invest their money prudently - or else they go out of business. el Presidente Chavez apparently doesn't like the fact that the banks of Venezuela consider his state run enterprises to be poor financial risks and don't want to risk extending loans to them. Given the behavior of the Venezuelan government recently, the banks are probably concerned that any money lent will never be repaid either because the state enterprises lose so much money they can't afford to pay it back, or because the government simply nullifies the debts, leaving the banks with a loss.

So Chavez's solution to their lack of fate in his financial management is to threaten to simply steal the banks and all of their assets from their owners. Just like any good little thug (read socialist for the 21st century). Faced with this threat, Venezuelan banks will likely cave in and invest depositor money in Chavez's state run ventures. And those ventures will go the same way as "state run enterprises" all over the world, namely straight to bankruptcy. Then the banks will collapse and Venezuelan depositors will lose their savings. At which point Chavez will blame the bankers, speculators, middle class, internationalists and capitalists (and almost certainly the U.S) - everyone but himself for forcing the banks to invest in his sinking socialist ship. With each passing day, the news out of Venezuela resembles more and more the plot of Ayn Rand's Atlas Shrugged.

Just for the record - and to remind those neoconservatives who think democracy is the panacea for all human ills - Chavez is the duly elected leader of Venezuela, winner of two national elections. The people of Venezuela knew what he was and voted him in anyway. And they are going to get what they deserve. But good and hard.

The Benefits of Free Trade with China

Poisoned pet food - a perfect example of the wondrous benefits of free trade with the People's Republic of China:

ZHANGQIU, China, April 28 — As American food safety regulators head to China to investigate how a chemical made from coal found its way into pet food that killed dogs and cats in the United States, workers in this heavily polluted northern city openly admit that the substance is routinely added to animal feed as a fake protein.

Workers at the Shandong Mingshui Great Chemical Company say they commonly add the chemical melamine in the process of making animal feed. Melamine appears as protein but has no nutritional value.
For years, producers of animal feed all over China have secretly supplemented their feed with the substance, called melamine, a cheap additive that looks like protein in tests, even though it does not provide any nutritional benefits, according to melamine scrap traders and agricultural workers here.

“Many companies buy melamine scrap to make animal feed, such as fish feed,” said Ji Denghui, general manager of the Fujian Sanming Dinghui Chemical Company, which sells melamine. “I don’t know if there’s a regulation on it. Probably not. No law or regulation says ‘don’t do it,’ so everyone’s doing it. The laws in China are like that, aren’t they? If there’s no accident, there won’t be any regulation.”

The PRC has hugely benefited from American free trade policies, greedily running American businesses out of the marketplace using China's artificially deflated currency and cheap-as-slave-labor wages (and, quite often, actual slave labor), or forcing U.S. companies to relocate their manufacturing facilities out of the U.S. Meanwhile, China has plowed the hundred of billions of dollars in profits from these ventures (many owned or controlled by the Chinese military) into an ambitious military modernization and build-up whose goal of to turn China into a counterweight to the U.S. and thus drive American influence out of Asia. Meanwhile, in Washington, the usual suspects have turned their heads and repeated their tired mantras about the benefits of free trade.