Falklands to hold referendum on status

by: From correspondents in London From: AFP June 13, 2012

THE Falkland Islands will hold a referendum on its political status in the first half of 2013, the British ruled territory's government has announced.

"We have decided, with the full support of the British government, to hold a referendum on the Falkland Islands to eliminate any possible doubt about our wishes," Gavin Short, chairman of the Falklands' legislative assembly, said today.

The government said the island did not wish to be ruled by Argentina.

http://www.couriermail.com.au/news/breaking-news/falklands-to-hold-referendum-on-status/story-e6freonf-1226393659784

Syria in full-scale civil war, United Nations says

by: AFP From: AFP June 13, 2012 7:14AM

SYRIA is now in a full-scale civil war, UN peacekeeping chief Herve Ladsous said, as UN observers report being fired on as they tried to enter a town feared to be the focus of a new massacre.

..US Secretary of State Hillary Clinton has warned Washington will find it hard to support the extension of the observer mission beyond next month if the government of President Bahar al-Assad's regime continues to show "contempt" for a UN-backed ceasefire that was supposed to go into effect from April 12.

Asked whether he believed Syria is in a civil war, Mr Ladsous said: "Yes I think we can say that. Clearly what is happening is that the government of Syria lost some large chunks of territory, several cities to the opposition, and wants to retake control."

"I think there is a massive increase in the level of violence, so massive indeed that in a way it indicates some change of nature," he said.

"Now we have confirmed reports of not only of the use of tanks and artillery but also attack helicopters."

The under-secretary-general for peacekeeping operations is the most senior UN official to indicate he believes there is a civil war. UN leader Ban Ki-moon said last week that he believed it was "imminent".

The UN Supervision Mission in Syria had been trying to reach the northwestern town of Al-Haffe, a Sunni Muslim enclave in a region mainly populated by members of Mr Assad's Alawite minority, where hundreds of civilians are reported trapped by an army siege of holed up rebel fighters.

The mission said it had received reports of "a large number of civilians, including women and children trapped inside the town and are trying to mediate their evacuation".

At least 120 people have been killed in the fighting in and around Al-Haffe over the past week, including 68 troops, 29 civilians and 23 rebel fighters, with hundreds wounded, according to the Britain-based Syrian Observatory for Human Rights.

The UN observers were forced to abandon their attempt to reach the town yesterday when an angry crowd in a nearby pro-government village threw rocks and metal bars at them, and unknown assailants then fired on them.

Mr Ladsous said one military observer came close to being hit by a bullet.

"We thought he was injured but in fact the bullet did not enter him but hit his boot.

"There were many impacts that hit the car, so it was deliberate," he said.

Another UN official said the crowd that surrounded the UN convoy was carrying government flags and at least 20 bullets hit the car carrying the observers.

Mrs Clinton said renewing the mission would be difficult without progress in implementing the six-point peace plan brokered by UN-Arab League envoy Annan, and also hit out at Moscow for sending attack helicopters to its Damascus ally.

"We are concerned about the latest information we have that there are attack helicopters on the way from Russia to Syria, which will escalate the conflict quite dramatically," she said.

"We have confronted the Russians about stopping their continued arms shipments to Syria. They have from time to time said we shouldn't worry, that everything they're shipping is unrelated to their actions internally. That's patently untrue."

http://www.heraldsun.com.au/news/more-news/syria-in-full-scale-civil-war/story-e6frf7lf-1226393726840

Recession took Americans' net worth back to 1992 Washington
June 13, 2012

THE recession shrank Americans' wealth so much that in 2010 median family net worth was no more than it had been in 1992 after adjusting for inflation, the US Federal Reserve says.

Median net worth declined from $US126,400 in 2007 to $US77,300 in 2010, a Federal Reserve survey of family finances has found.

The median marks the point where half had more and half had less. The recession officially began in December 2007 and ended in June 2009.

Net worth is the value of assets such as homes, bank accounts and shares, minus debts including mortgages and credit cards.

The Federal Reserves's findings are in its latest Survey of Consumer Finances, a comprehensive review of household finances that it carries out every three years.

A separate survey the Federal Reserve released last week showed that total family net worth climbed 4.7 per cent in the March quarter to $US62.9 trillion, about 28 per cent above its recession low. The increase was fuelled by stockmarket gains.

Those gains put net worth about 5 per cent below its pre-recession peak. But since the first quarter, lower share prices have eroded some household wealth.

Among families that owned homes, the consumer finances survey found that their median home equity declined from $US95,300 in 2007 to $US55,000 in 2010, a drop of 42.3 per cent.

The survey found that median income fell from $US49,600 in 2007 to $US45,800 in 2010, a drop of 7.7 per cent.




Read more: http://www.theage.com.au/world/recession-took-americans-net-worth-back-to-1992-20120612-2082c.html#ixzz1xceFUnYG

Russians stage huge protest defying Putin’s tough line Moscow
June 13, 2012

TENS of thousands of Russians have flooded Moscow’s tree-lined boulevards in the first massive protest against President Vladimir Putin’s rule since his inauguration.

Investigators sought to raise the heat on the opposition by summoning some of its leaders for questioning yesterday just an hour before the march.

The rally comes as a key test of Mr Putin’s line towards the opposition, following quick passage of a repressive bill introducing heavy penalties for taking part in unauthorised rallies.

Searches of opposition leaders’ apartments and their interrogation were widely described as a crude attempt by the government to scare the protesters.

Leftist politician Sergei Udaltsov snubbed the summons, saying on Twitter that he considered it his duty to lead the protest as one of its organisers. The Investigative Committee said it would not immediately seek his arrest but would interrogate him later.

Anti-corruption blogger Alexei Navaly, liberal activist Ilya Yashin and TV host Ksenia Sobchak attended the interrogation session that prevented them from attending the demonstration.

Investigative Committee spokesman Vladimir Markin said authorities had found more than €1million ($A1.27million) in cash at Ms Sobchak’s apartment and would check to see if she had paid her taxes.

Ms Sobchak, the daughter of a late mayor of St Petersburg, who was Mr Putin’s mentor, had been spared reprisals until Monday’s raid. ‘‘I never thought that we would slide back to such repressions,’’ she tweeted on Monday.

Braving a brief thunderstorm, protesters showed up early on the landmark Pushkin Square and their number grew as they marched to the rally.

Despite fears of unrest following a violent police crackdown on a protest last month, the demonstration went on peacefully.

Mr Udaltsov put the number of protesters at 50,000, while police estimated that about 18,000 showed up.

AP




Read more: http://www.theage.com.au/world/russians-stage-huge-protest-defying-putins-tough-line-20120612-20818.html#ixzz1xcfjobEA

Tunis declares curfew after 'Islamist' rioting

Tunisia has declared an overnight curfew on eight regions, including the capital, an interior ministry official says, in the wake of serious rioting.

The eight-hour curfew was introduced after several violent attacks in protest at an art exhibition.

The government has blamed ultra-conservative Islamists known as Salafists for the violence, in which police stations were set on fire.

But the Salafists have denied being involved in the rampage.

The curfew will be in place in the suburbs of Ben Arouss, Ariana and Manouba as well as the cities of Sousse, Monastir, Jendouba and Ben Guerdane.
'Heavy price'

Monday's overnight series of attacks targeted police stations, a court and an art gallery.

In one northern suburb, La Marsa, rioters tried to force their way into an art gallery where several paintings deemed "blasphemous" had been slashed a day earlier by Islamists.

The exhibition included paintings that caricatured Mecca, portrayed a nude woman, and showed the word "Allah" spelled out with strings of ants.

The offices of Tunisia's main labour union in the north-west city of Jendouba were also set alight by Salafis overnight, state television reported according to Reuters.

The country's Justice Minister Nourredine Bhiri said that those behind the violence would "pay a heavy price".

"These are terrorist groups which have lost control, they are isolated in society," he told a Tunisian radio station.

He said some of the violence, which came hours after al-Qaeda leader Ayman al-Zawahiri urged Tunisians to turn against the government, may have been inspired by the group.

An official from the justice ministry said that those arrested would be brought to justice under a 2003 anti-terror law, AFP reports.

The Salafist movement called on Tunisians to protest against "infringements against Islam" but said it had nothing to do with the violence.

Since the fall of Tunisia's autocratic leader Zine al-Abidine Ben Ali, in January 2011, there has been a resurgence of hard-line Islamists in the country.

Some of the Salafists' most radical branches have been holding demonstrations to demand an introduction of Sharia in Tunisia.

Spain insists bank rescue has no austerity strings

Updated: 11:32, Wednesday, 13 June 2012

Spain's government insisted that a vast euro zone rescue loan for its banks comes with no new strings related to austerity or broader economic reforms.

Facing parliamentary questions over the loan of up €100 billion to salvage the banks, Economy Minister Luis de Guindos denied it imposed new conditions beyond the financial sector.

Loan conditions would be specific to the banking sector with no requirement for a broader austerity programme, he told parliament.

"I insist there are no supplementary conditions on budget policy, nor structural reforms," he said.

There would be no new recommendations beyond those made by the European Commission on May 30 as part of its monitoring of Spain for exceeding agreed public deficit limits, the minister said.

European Union economic and finance chiefs would decide on those recommendations "soon", he said. Prime Minister Mariano Rajoy stressed that banks would have to repay the money.

"It is a credit for the banking system that the banking system itself will have to pay, and we should celebrate the fact that our European partners have helped us," he told parliament.

Spain urged ECB to take urgent action in crisis

Spain's Prime Minister Mariano Rajoy called for the European Central Bank to intervene urgently to calm financial markets in a letter dated June 6 and released today.

Rajoy wrote the letter to European Union president Herman van Rompuy and European Commission chief Jose Manuel Barroso three days before the euro zone agreed a vast rescue loan for Spain's banks.

"Given the deep-seated doubts about the euro, the speed of financial markets and the flight of liquidity from the periphery to the centre, we need to act with urgency to stabilise financial markets and lower risk premiums," he said.

"Businesses and households need access to liquidity. That is impossible if doubts persist over the sustainability of the debt of sovereign states," Rajoy warned.

Europe needed the necessary instruments to calm market fears, the prime minister added.

"Today, the only institution we have with the capacity to assure the required conditions of stability and liquidity is the European Central Bank," the Spanish leader said.

"Assuring financial stability is, at this time, essential to show the commitment of member states to the irreversible nature of the euro," he cautioned.

Spain borrowing costs still a cause of concern

Spanish borrowing costs remain at euro-era record highs on a market beset by doubts over a vast rescue loan for the country's banks and by fears of a Greek exit from the euro zone.

Investors remain unconvinced by the deal struck by the 17 euro zone nations over the weekend to extend Spain a banking sector rescue loan of up €100 billion.

Two major concerns stood out: doubts over Spain's outlook even with the euro zone rescue, and Greek elections on Sunday, which in a worst-case scenario could send Athens back to using the drachma.

Adding to Spanish agony, Fitch Ratings yesterday downgraded 18 more Spanish banks a day after cutting its ratings on the two biggest banks, Santander and BBVA, despite the massive sector bailout.

Spain's benchmark 10-year government bond yield spiked to 6.834%, the highest since the creation of the euro. While it later eased to stand at 6.716%, this rate is still regarded as unsustainable over the longer term.

The nation's risk premium - the extra rate investors demand to hold its 10-year bonds over their safer German counterparts - hit 5.43 percentage points, not far from the euro-era record of 5.48 percentage points struck shortly before the banking rescue.

Far from calming the markets, the rescue for Spain exposed a string of new doubts over the impact on the debt; how it will be implemented; and whether it will be just the first rescue for a nation struggling to cut deficits in a period of recession and sky-high unemployment.

Spain is expected formally to seek the loan at a euro zone finance ministers' meeting June 21, and a final figure would come after a review by the European Union, European Central Bank and IMF, officials said.

And tiny Cyprus has added to the gloom. Cyprus Finance Minister Vassos Shiarly told journalists earlier this week that his country had an "exceptionally urgent" need for a bailout to recapitalise its banks by June 30, according to The Wall Street Journal.

Moody's ratings agency downgraded two Cyprus banks yesterday, citing their large exposure to a possible Greek exit from the euro zone, including chopping its rating for Bank of Cyprus by one notch to B2 from B1.

The big spectre, however, remains Greece, and the prospect that the anti-austerity party Syriza will win elections on Sunday, rejecting the terms of Athens' international bailout and leading possibly to its departure from the 17-nation single currency bloc.

Meanwhile the World Bank yesterday warned developing countries to boost their defences against Europe's debt crisis, predicting years of volatility in a flailing global economy.

http://www.rte.ie/news/2012/0613/spain-insists-bank-rescue-has-no-austerity-strings.html

World braces for Greek election fallout

June 17, 2012 - 8:45AM


One historian describes today's vote in Greece as the financial version of the Cuban Missile Crisis.

European leaders are seeking to calm fears that the Greek election would trigger a Lehman Brothers-style run on eurozone banks after polls showed the leftist Syriza group could deny pro-austerity parties overall control in today's election.

The British prime minister, David Cameron, joined the German chancellor, Angela Merkel, and the French president, Francois Hollande, in emergency talks to prepare for the aftermath of a vote that the historian Niall Ferguson warned was ‘‘the financial equivalent of the Cuban missile crisis’’.

Stock markets are expected to fall when they open on Monday if voters fail to produce a clear result, as happened in May. Leaders also fear a mass withdrawal of bank savings, forcing governments to launch expensive rescue bids for vulnerable banks or risk a destabilising collapse.

Greece’s interim prime minister warned that the country was at a critical juncture because the election could determine its future in the eurozone. The brinkmanship between Athens and Brussels appeared to be giving way to a final confrontation.

Panagiotis Pikrammenos, the prime minister, spoke of ‘‘dangerous inertia’’ in state operations and the need for ‘‘critical’’ decisions to be made after a two-month delay in promised reforms while back-to-back electoral campaigns were held.

Greece is holding its second election in six weeks with all leading candidates now calling for some renegotiation of a bailout deal despite warnings that Greece must toe the line or leave the euro.

Alexis Tsipras, the leader of the Syriza group, repeated his threat to tear up the agreement between Athens and Brussels and call Europe’s bluff. He said the eurozone will not eject Greece for fear of the consequences for other indebted members, such as Spain and Italy. His main rival, Antonis Samaras, said Greece risked becoming a pariah if it defaulted .

Greece has already negotiated with its private sector creditors a 105 billion-euro ($131 billion) cut in its loans, which was expected to reduce its debts from almost 190 per cent of national income to nearer 130 per cent. It was offered a second package of loans earlier this year in return for public sector spending cuts and economic reforms, most of which have yet to be implemented.

Samaras, in his final rally, said Greeks were deluded if they believed they could avoid much needed reforms and the vote was between the drachma and the euro. ‘‘If we cancel the bailout plan, we will turn into the black sheep of Europe,’’ he said, imploring voters not to trust Tsipras.

Samaras is the bookmakers’ favourite, but is still expected to fall short of an overall majority following strong showings for the far right Golden Dawn party and Tsipras’s Syriza leftist coalition.

'Cuban Missile Crisis' equivalent

Niall Ferguson, the Harvard historian, commented: ‘‘If there’s going to be a Lehman moment in the crisis it’s going to be next week.’’

He likened negotiations between Athens and Berlin to ‘‘a game of chicken’’ that will continue while Athens is plagued by hung parliaments. ‘‘It’s not clear who’s going to blink at this point. My guess is that, in the end, there will be a bit of blinking on both sides.

‘‘This is the financial equivalent of the Cuban missile crisis. And the missile is really a bank run, which ultimately even the Germans can’t be completely immune to. Not that there will ever be a run on German banks, but the effects of a bank run across southern Europe are going to be felt by the economy. German policymakers know that; they’re having to say one thing to their own voters and another thing privately to other European leaders.’’

Merkel has warned that eurozone countries must follow agreed austerity measures in speeches in recent weeks designed to warn Greek voters that a new loan deal is out of the question. However, she has come under intense pressure to take a more kindly view of the situation after the Spanish bank rescue, which it is understood Madrid won on easier terms.

Holding her tough line is also expected to become more difficult after the International Monetary Fund said Spain would miss its deficit reduction target this year and Ireland would need softer terms on its existing bailout to survive.

Brussels is duty bound to fine Madrid for missing deficit reduction targets, something it will find difficult to justify only weeks after it sanctioned the 100 billion euro ($125 billion) rescue of Spain’s smaller banks. Dublin has pleaded for easier terms on its loans on several occasions only to be rejected.


The review by the IMF - one of three lenders, with Brussels and the European Central Bank, funding eurozone bailouts - will further isolate the German leader, who told her parliament on Wednesday that Germany could not be expected to dig deeper to fund easier terms.

‘‘Germany’s strength is not unlimited,’’ she said. ‘‘The way out of the crisis can only be successful if all countries are capable of recognising the reality and realistically assessing their strengths.’’

There are rising concerns that Italy’s economy is only months away from needing a rescue deal.

Guardian
http://www.theage.com.au/business/world-business/world-braces-for-greek-election-fallout-20120617-20hn1.html

Egyptian runoff elections today will see Islamists take true power. Those poor people that gave up their lives in the fight for a truly free, fair & democratic place to live all died in vain thanks to the tyranny of the majority.

Greeks vote for euro as pro-bailout parties claim victory

June 18, 2012 - 6:07AM


The pro-bailout New Democracy party has come in first in the Greek election, and its leader has proposed forming a pro-euro coalition government.

In claiming victory, New Democracy leader Antonis Samaras said "the Greek people today voted for Greece to remain on its European path and in the eurozone".

He said voters chose "policies that will bring jobs, growth, justice and security".

His party beat the anti-bailout Syriza party, which wanted to cancel Greece's international bailouts.

Syriza chief Alexis Tsipras, a 37-year-old former communist who has shot from obscurity to global celebrity in a matter of weeks, has conceded defeat in the election.

Although no party has won enough seats to form a new government on its own, the polls indicate the country's two traditional parties - New Democracy and Pasok - will have enough seats to form a coalition together.

An official projection released by the interior ministry showed conservative New Democracy taking 29.5 per cent, with the radical leftist Syriza bloc just behind on 27.1. The Pasok Socialists were set to take 12.3 per cent of the vote.

Because of a 50-seat bonus given to the party which comes first, that result would give New Democracy and Pasok 161 seats in the 300-seat parliament, in an alliance committed to a 130 billion euro ($164 billion) EU/IMF bailout keeping the country from bankruptcy.

"I am relieved," a smiling Samaras told Reuters, leaving his office to joyous chants from supporters. "I am relieved for Greece and Europe. As soon as possible we will form a government."

Samaras said in a speech that the country would honour its commitments to its euro zone partners.

"The Greek people voted today to stay on the European course and remain in the euro zone... there will be no more adventures, Greece's place in Europe will not be put in doubt," he said.



The result, however, exposed a deeply divided society, and could leave an emboldened Syriza leading new protests against a coalition governing with significantly less than 50 per cent of the electorate's support.

Pasok leader Evangelos Venizelos called for a government that would include Syriza , but the radicals ruled out joining a coalition that would stick to the punishing bailout terms that have helped condemn Greece to five years of record recession.

Tsipras had vowed to tear up the terms, betting that European leaders cannot afford the financial market turmoil that could be unleashed by cutting a member of the euro zone loose.

The projection was based on votes counted on the spot at about 12 per cent of polling stations and sent to the ministry via text message.

It proved highly accurate in an earlier May 6 election, which produced stalemate, though the figures are subject to a margin of error which leaves a degree of uncertainty. Earlier exit polls produced a similar result to the government projection, giving New Democracy and Pasok 159 seats combined.

Greece's lenders say a new government must accept the conditions of the bailout - on top of a 110 billion euro package in 2010 - or funds will be cut off, driving Athens into bankruptcy.

A Greek euro exit has the potential to unleash shocks that could even break up Europe's single currency and plunge the global economy into chaos. The result will dominate a meeting of the Group of 20 world economic powers in Mexico today.

Central banks from major economies stand ready to take steps, including coordinated action, to stabilise markets if the election triggers a financial storm or public panic, G20 sources told Reuters last week.

They may well not be needed.

The euro hit a three-week high against the US dollar, rising to around $1.2730 in early Monday trade, from around $1.2655 late in New York on Friday. It hit its strongest since May 22 according to Reuters charts.

"What stands out is how close Syriza came... so we expect some robust opposition to the austerity measures," said Daragh Maher, currency strategist at HSBC in London. "Markets will be concerned about how narrow the margin of victory was for ND and any gains in the euro and other markets will be limited."

Last chance

The ultra-right Golden Dawn party looked set to win 18 seats, underscoring the fragmentation of a society wrestling with unemployment of almost 23 per cent and plummeting living standards.

The traditional ruling parties of New Democracy and the Pasok Socialists are accused by many Greeks of presiding over decades of corruption and waste which have left them with a ruined economy and one of the heaviest debt burdens in the world.

Five years of recession and more than two years of acute crisis have started to fray the edges of Greek society, undergoing its severest test since the overthrow of the military dictatorship in 1974.

The streets of central Athens are scarred by repeated waves of protests, some hospitals are short of vital medicines and reports of suicides caused by the crisis have become routine.

Samaras has called for an extra two years to make the cuts demanded of his country. But Greece's euro zone peers are prepared only to tinker with the deal and then only with a government firmly committed to the bailout.

"There can't be substantial changes to the agreements but I can imagine that we would talk about the time axes once again, given that in reality there was political standstill in Greece because of the elections, which the normal citizens shouldn't have to suffer from," German Foreign Minister Guido Westerwelle said on German TV station ARD.

"But there is no way out of the reforms. Greece must stick to what has been agreed," he said.

Opinion polls show Greeks, weary and disillusioned after five years of deep recession, overwhelmingly favour remaining in the euro and just as opposed to the austerity drive.

"I voted for the bailout because these are the terms that will keep us in Europe," said 66-year-old English teacher Koula Louizopoulou after casting her ballot in Athens, hinting that she had chosen New Democracy.

"It's the first time I feel depressed after voting, knowing that I voted again for those who created the problem, but we don't have another choice," she added.

Reuters, AP

http://www.smh.com.au/world/greeks-vote-for-euro-as-probailout-parties-claim-victory-20120618-20iol.html

300 seat parliament, sheesh

Syria admits to shooting down Turkish jet

by: AAP From: AAP June 23, 2012 8:40AM

UPDATE: SYRIA says it has shot down a Turkish military plane and Turkey has vowed to "determinedly take necessary steps" in response.

..Syria's state-run news agency, SANA, said the military spotted an "unidentified aerial target" that was flying at a low altitude and at a high speed.

"The Syrian anti-air defences counteracted with anti-aircraft artillery, hitting it directly," SANA said late on Friday.

"The target turned out to be a Turkish military plane that entered Syrian airspace and was dealt with according to laws observed in such cases."

Turkey issued a statement on Friday night following a two-hour security meeting led by Turkish Prime Minister Recep Tayyip Erdogan, saying Syrian forces downed the plane and that the two Turkish pilots remain missing.

It said Turkey "will determinedly take necessary steps" in response, without saying what those actions would be.

"Following the evaluation of data provided by our related institutions and the findings of the joint search and rescue efforts with Syria, it is understood that our plane was downed by Syria," the statement said, without providing other details.

Relations between Turkey and Syria were already tense before the downing of the F4 plane on Friday.

Turkey has joined nations such as the US in saying that Syrian President Bashar Assad should step down because of the regime's brutal suppression of the uprising in his country. Turkey also has set up refugee camps on its border for more than 32,000 Syrians who have fled the fighting.

Syria and Turkey have expelled each other's ambassadors and Syria has accused Turkey of supporting Syrian opposition and even allowing Syrian rebels to operate out of Turkish soil. Turkey strongly denies the allegations.

After a cross-border shooting by Syrian forces in April, Turkey said it would not tolerate any action that it deemed violating its security. The firing had left two refugees dead at a camp near the town of Kilis just inside Turkey.

Foreign Ministry Spokesman Selcuk Unal earlier on Friday rejected allegations that Turkey was sending arms and other equipment to Syrian rebels as baseless. Unal said Turkey was not sending weapons to any of its neighbours, including Syria.

Turkey's military provided no details on the downed plane's mission Friday, but some Turkish TV reports said it was on a reconnaissance flight.

Syria claimed the jet violated its air space over territorial waters, penetrating about 1km, but that Syrian vessels joined the search for it, according to Turkey's NTV television. It said Syria forces realised that it was a Turkish jet after firing at it.

Ilter Turan, a professor of political science at Istanbul's Bilgi University, told NTV that Syria's action was clearly "hostile," even if it violated its air space.

He predicted however that Syria will try to avoid escalating tensions further.

Erdogan said the plane went down in the Mediterranean Sea about 13km away from the Syrian town of Latakia.

Four Turkish gunboats and three helicopters were searching for the pilots and wreckage of the plane.

http://www.heraldsun.com.au/news/more-news/turkish-says-syria-shot-down-plane/story-e6frf7lf-1226406148515

Queen to meet ex-IRA leader

Henry McDonald
June 24, 2012

MARTIN McGUINNESS, the former chief of staff of the IRA, will meet Queen Elizabeth for the first time this week in a historic step towards reconciliation.

The Irish republican party Sinn Fein confirmed Mr McGuinness would shake the monarch's hand at a charity event on Wednesday in a momentous milestone in the republican movement's road from an armed campaign that once saw it target the Prince of Wales towards peace and reconciliation.

Sinn Fein ended weeks of speculation when the party president, Gerry Adams, announced on Friday his partner in pushing the republican movement from violence to constitutional politics would meet the Queen at a cross-border charity event in Belfast this week. The Queen will make a two-day visit to Northern Ireland as part of her diamond jubilee tour.

Speaking after a special meeting of Sinn Fein's leadership, Mr Adams said it was a ''significant initiative''. The forthcoming encounter between Mr McGuinness and the Queen, who commands Britain's armed forces, was part of Sinn Fein's policy to reach out to the unionist community. It reflected Sinn Fein's ''genuine desire to embrace our unionist neighbours''.

Mr McGuinness was a senior IRA commander when the Queen's cousin, Lord Mountbatten, was murdered. The President of Ireland, Michael Higgins, will attend the event as he and the Queen are joint patrons of charity Co-operation Ireland.

The charity's chief executive, who is a former senior police officer in Northern Ireland, Peter Sheridan, said the reception would be an important step forward for the ''healing process''.

''It is something that demonstrates to ordinary people that we have got to the stage where we can acknowledge each other with respect. It does not mean that we have to agree.''

Mr McGuinness's former comrades-turned-enemies in the hard-line Republican Sinn Fein called the decision last night ''the final symbolic cementing of British rule''.

Vernon Coaker, the shadow Northern Ireland secretary, welcomed it as ''another important sign'' things were moving in the right direction. ''Martin McGuinness has shown significant leadership over the last number of years, and his contribution to building a better future for Northern Ireland is further enhanced by this decision.''

Sinn Fein used to boycott events involving the British royal family. In 1979 an IRA bomb killed Lord Mountbatten and three others on his boat off the Co Sligo coast of the Republic of Ireland.

Guardian News & Media


Read more: http://www.smh.com.au/world/queen-to-meet-exira-leader-20120623-20uyz.html#ixzz1yd5zqlRN

George Pell in Pope's special meeting of cardinals to deal with Vatican leaks

From: AP June 24, 2012

POPE Benedict XVI has convened a special meeting of cardinals for advice on how to deal with the Vatican's leaked documents scandal.

The pope was already scheduled to attend a regular meeting of the heads of Vatican offices on Saturday morning.

The Vatican press office said he added a second meeting later in the day with other cardinals - including Sydney archbishop George Pell - in a bid to try to ''restore a climate of serenity and trust'' in the church.

The Vatican said over the coming days he will meet with still more cardinals gathering in Rome for a church feast day on Friday to ''continue the dialogue with the people who share the responsibility of the church's governance with him''.

The Vatican has been scrambling to contain the damage after the leak of hundreds of Vatican documents exposed claims of corruption, political infighting and power struggles at the highest level of the Catholic Church.

...The pope's butler, Paolo Gabriele, is under arrest at the Vatican, accused of aggravated theft after the pope's own documents were found in his Vatican City apartment.

One Holy See investigation into the links is a criminal one headed by Vatican gendarmes; there is also an internal probe led by a commission of three cardinals tasked with getting to the bottom of the scandal.

Last weekend Benedict met with the cardinal's commission to learn details of some of the two dozen people they have questioned.

The meetings on Saturday were another indication of the seriousness with which he has taken the scandal and the damage it has done to the trust that is supposed to form the basis of the Vatican's governance.

In another sign the Vatican was taking the matter seriously, it confirmed on Saturday that it was bringing in the Fox News correspondent in Rome, Greg Burke, as a senior communications adviser to help the Vatican craft its communications strategy.

Burke, 52 and a member of the conservative movement Opus Dei, said he would be helping to shape the Vatican's message and make sure all Vatican departments stick to it.

He is leaving Fox News to take the Vatican job.

In a statement, the Vatican said the regularly scheduled meeting with department heads aimed at coordinating the Vatican's work was ``today particularly important and urgent to show efficient witness to the union of spirit that animates the Curia''.

The second meeting on Saturday includes Vatican cardinals, and the archbishops of Sydney and the retired vicar of Rome - two long-time papal advisers.

Benedict also moved to beef up a panel of cardinals tasked with scrutinising the ``organisational and economic problems of the Holy See,'' the Vatican said.

He appointed to the panel three cardinals: Polycarp Pengo, an archbishop from Tanzania; Telesphore Toppo, from India, and John Tong Hong, the Hong Kong prelate who was elevated to the rank of cardinal earlier this year by the pontiff.

All three are involved with the Holy See office that bankrolls missionary work abroad.

Two years ago, Italian prosecutors began probing real estate transactions and other dealings of Naples' cardinal, an Italian prelate who formerly headed that office.

The Italian authorities have been looking into an alleged web of kickbacks and favours, including purported sexual ones, involving businessmen, church hierarchy and public officials.

Cardinal Toppo also serves on a cardinals' watchdog committee for the activities of the Vatican bank.
AP

http://www.theaustralian.com.au/news/world/george-pell-in-popes-special-meeting-of-cardinals-to-deal-with-vatican-leaks/story-e6frg6so-1226406689370

Fox reporter to Vatican Rome
June 26, 2012

Greg Burke.
A FOX News reporter has been chosen by Pope Benedict XVI to sort out the Vatican's media strategy amid signs that the 85-year-old pontiff is plotting a radical shake-up at the top of the Roman Catholic church.

Greg Burke, a 52-year-old member of the conservative Opus Dei fellowship, is to take a job in the Vatican's secretariat of state. He said: ''I feel exactly the way I felt in Lebanon at the start of the 2006 war - nervous and excited at the same time.''

Burke, who is Rome correspondent for Fox television, said he had twice refused a similar offer from the Vatican ''because I had a really great job''.

The appointment followed a meeting between the Pope and his cardinals on Saturday. The Vatican has been in turmoil, with the sacking of the head of the Vatican bank and the arrest of the Pope's butler, who is accused of leaking correspondence. After a meeting on Saturday, the Pope consulted a group of five cardinals that did not include the Secretary of State, Cardinal Tarcisio Bertone.

Exclusion of the Vatican's ''prime minister'' prompted speculation that Pope Benedict had yielded to pressure for Cardinal Bertone's removal.

GUARDIAN


Read more: http://www.theage.com.au/world/fox-reporter-to-vatican-20120625-20ygi.html#ixzz1ytBPIC5o

Eurozone crisis live: German, French, Spanish and Italian finance ministers to meet today

• Moody's downgrades 28 Spanish banks
• Cyprus becomes fifth eurozone country to need a bailout
• Live blogging now: Rupert Neate

10.21am: Some expert comment on the dire public sector finances from Olann Kerrison, head of product management at the foreign exchange specialists Moneycorp:

Plan A, it would appear, is kaput. The spike in public sector borrowing, to £17.9bn in May, is a body blow to the Chancellor and the coalition government's handling of the economy.
There is often a dip in tax revenues in May, following the end of the tax year, but this doesn't hide the fact that borrowing is significantly higher than in May 2011 when it was just £15.2bn.
The simple fact of the matter is that tax revenues are down — and borrowing up — because the economy is weak. Unfortunately, there is every chance the economy will weaken further in the months ahead as the Eurozone unravels.
Domestic demand is weak, and so is demand from overseas, especially from the Eurozone. This is decimating tax revenues and forcing the Government to borrow more.
The Labour spin machine will be all over these numbers, reiterating that austerity doesn't work.

10.15am: Ian Traynor has written a full story on the European leaders radical plan to reshape the eurozone.


[They] plan to turn the 17 countries of the eurozone into a full-fledged political federation within a decade in an attempt to placate the financial markets by demonstrating a political will to save the single currency in the medium-term.
The incendiary proposals for a banking, fiscal, and economic unions resulting in a "political union" are to be debated at an EU summit on Thursday and Friday. Following two bad-tempered meetings of European leaders in Mexico and Rome over the past week, the Brussels summit looks likely to see major clashes over the future of Europe as well as the immediate crisis surrounding sovereign debt, bad banks, and the euro's survival.

You can read the whole of the report here.

10.06am: The results of Spain's bond auction are out. Spain sold €3.0bn of short-term debt - but it came at price: the highest rates since November.
The yield on 3-month bonds was 2.362%, up massively from 0.846% last month. Six months bonds sold on a yield of 3.237% up from 1.737%.

9.53am: The ONS said public sector debt as a percentage of GDP (excluding financial interventions) now stands at 65% - the third highest on record.

9.41am: UK public borrowing figures for May are much higher than expected. The ONS said public sector net borrowing (excluding public sector interventions) came in at £17.9bn compared to £15.2bn last year.

9.11am: More details are coming through about the meeting between finance ministers of Germany, France, Italy and Spain in Paris later today.

"We want to work with Germany," Moscovici told France Info radio, asked about the pressure on President Francois Hollande and German Chancellor Angela Merkel to reach an agreement on ways to curb the spiralling eurozone crisis.

"Tomorrow there is a meeting, which will be very important, between Francois Hollande and Angela Merkel and this evening I will receive the finance ministers: Mr. Schaeuble from Germany, Mr. Monti or Mr. Grilli of Italy and Mr. de Guindos of Spain along with the European Commissioner," Moscovici said.

"We are in an active phase of preparation of this summit."

Hollande wants measures like mutualised debt and joint bank deposit guarantees to be worked on at the same time as moves towards deeper fiscal integration, while Merkel, wants an accord on closer integration before any other steps are taken.

9.10am: We've got quite a busy day ahead of us, here's a selection of the key events (all times are BST):

• 9:30am: Spanish and Italian bond auctions.
• 9:30am: Spain's finance minister is up before parliament to explain the bailout.
• 9:30am: Public sector net borrowing figures for May are expected to have reached £16-16.5bn, compared with £15bn in May last year.
• 10:00am: Mervyn King is speaking in front of a Treasury select committee.
• Unspecified time: The finance ministers of Germany, France, Spain and Italy are meeting in advance of the EU summit on Thursday and Friday.

...

8.30am: The Greek English language paper Kathimerini reckons it knows who's going to replace Vassilis Rapanos as finance minister.

Let's hope the new guy lasts longer than Rapanos, who resigned yesterday due to ill health less than a week after being appointed to the post.

The Guardian's Europe editor, Ian Traynor, has got hold of a copy of the gang of four's master plan for the future of Europe and the Euro.

Ian says the seven-page document from the four presidents - Herman Van Rompuy of the European Council, Mario Draghi of ECB, Jose Manuel Barroso of the European commission, and Jean-Claude Juncker of 17-country Eurogroup - details a 10-year plan based on 4 "building blocks" - banking union, fiscal union, economic union, political union.

Ian's writing up a full story now, but in the meantime, he's posted the key points on Twitter.

8.05am: The BBC's Gavin Hewitt reckons the finance ministers of the power players - Germany, Spain, Italy and France - are going to get down to business a couple of days early.

8.01am: As all eyes turn towards the Europe Union summit on Thursday and Friday, the FT claims to have seen a draft report which could give the EU sweeping powers to rewrite national budgets for eurozone countries that breach debt and deficit rules.

The proposals are part of an ambitious plan to turn the eurozone into a closer fiscal union, giving Brussels more powers to serve like a finance ministry for all 17 members of the currency union. They are contained in a report to be presented at the summit, which will also outline plans for a banking union and political union.

Read the full FT story here (£)

7.41am: Good morning and welcome back to our coverage of another day of high drama in Europe.

Last night Moody's hit Spain, again. This time the rating agency downgraded 28 of the country's banks. Moody's latest salvo came just hours after the Spanish government finally formally asked for help from its European neighbours in cleaning up its stricken banking sector. It hasn't said how much dosh it wants, but did stress that stressed that the €62bn top figure provided last week by two independent auditors of Spain's banking system would cover against a severe downturn in the next three years – suggesting their request may not go much higher than that.

The world is also still reeling from the news that Cyprus has joined the unhappy club to ask for a bailout. To recap, that's Greece, Ireland, Portugal, Spain and Cyprus - quite the Club Med special. Who's going to be next, do you reckon?

http://www.guardian.co.uk/business/2012/jun/26/moodys-downgrades-spain-again

Queen takes step to heal IRA pain

Caroline Davies Enniskillen, Northern Ireland
June 28, 2012

AS SHE prepared for her meeting last night in Northern Ireland with former IRA commander Martin McGuinness, the Queen visited a community that had suffered one of the most notorious IRA attacks.

The Queen joined Catholic and Protestant leaders in Enniskillen, County Fermanagh, the site of the Remembrance Day bombing which killed 11 people and injured 63 others in 1987.

Crowds gathered to watch the Queen attend a service of thanksgiving in the Church of Ireland St Macartin's Cathedral, then cross the road to St Michael's Catholic church.


Britain's Queen Elizabeth II shakes hands with Northern Ireland Deputy First Minister and former IRA commander Martin McGuinness, watched by First Minister Peter Robinson, centre, at the Lyric Theatre in Belfast, Northern Ireland. Photo: AP

It was the first time in her 60-year reign that she had set foot in a Catholic church in Northern Ireland. But then this visit promised several ground-breaking moments. Chief among them is her meeting with Mr McGuinness, the Sinn Fein deputy first minister and former IRA commander.

Among the Enniskillen survivors to meet her was Stephen Gault, who was wounded that day, and whose father, Sam, was killed. ''Today brings back some terrible memories, to be sure,'' said Mr Gault, ''but above all, it shows us that the Enniskillen victims have not been forgotten.'' He said he believed the Queen's meeting with Mr McGuinness would be difficult for some. ''Nobody has been brought to justice for Enniskillen so it's very hard for the families to accept Mr McGuinness shaking the Queen's hand.''

But Robin Eames, the former Church of Ireland (Anglican) primate of All Ireland, welcomed the gesture. ''When I arrived in Enniskillen today I found it difficult to forget what happened. But I believe the handshake tomorrow is another milestone in the peace process.''

In entrenched republican areas, such as Derry's Bogside, graffiti reading ''Sinn Fein sellouts'' made clear the feelings of dissidents. At a rally in Belfast at the weekend, Mr McGuinness was denounced as a ''traitor''.

But Mr McGuinness showed no signs of retreat, and even stoked the symbolism. ''When shaking the hand of Queen Elizabeth, I'm extending the hand of peace to all my Unionist brothers and sisters,'' he said.

GUARDIAN


Read more: http://www.theage.com.au/world/queen-takes-step-to-heal-ira-pain-20120627-212sm.html#ixzz1z22FlM5f

Copyright convention spooks Beijing's pirates

John Garnaut, Beijing
June 28, 2012

BEIJING has been struck by a desperate shortage of pirated DVDs, clothes and handbags.

The city's popular DVD stores, usually stacked with $1 copies of new release films including some that haven't been officially distributed in China, have been stripped bare - aside from a dusty assortment of old Audrey Hepburn movies.

Shopkeepers at Beijing's Silk Market, with 1500 stalls, have replaced walls of Polo shirts and Abercrombie & Fitch jumpers with ''I Love Beijing'' T-shirts, while the trade in fake international brands has been confined to the boots of cars outside.

Thankfully, from the point of view of store owners and illicit bargain hunters - and despite a banner above the market's entry that translates as ''attack IP violating behaviour; safeguard market economy order'' - the usual counterfeit stocks will be back on the shelves as soon as international delegates to a major intellectual property conference have safely returned home.

''Come back on the 30th,'' said one shop assistant at the Silk Market, who normally stocks fake Polo shirts.

The reason for the empty shelves and Potemkin displays is that Beijing has been hosting the World Intellectual Property Convention where delegates signed the Beijing Treaty on Protecting Audiovisual Performances. Liu Qi, Politburo member and Beijing Party boss, said it was the pride of Beijing.

''Respect for intellectual property is a must,'' he said after the convention closed yesterday. ''We will grasp this opportunity to further strengthen intellectual property and build Beijing as the first city of IP.''

True to his word, in the high-end designer section of the Zoo Markets, store owners were carefully picking the labels off what looked like designer dresses and storing them in bags.

Labels for Prada, Gucci, Hermes, Lanvin, Chloe, Givenchy and Diane von Furstenberg were bagged and stored against the counter, ready to be sewn back on after the convention delegates return home.

A customer returned to buy the same black Phillip Lim dress she bought two weeks earlier, for 360 yuan ($A56) rather than the 4000 yuan price advertised on the Chinese online shopping site Taobao, and was sold the same dress for the same price but with the label removed.

International visitors have been kicking themselves for not checking the intellectual property conference calendar before planning their travel dates.

''I asked at the Silk Market why there was no Prada or Mulberry,'' said New Zealander Kristin Cook, after showing visitors around the city. ''They told me this is the week of the big meeting, and until the meeting was over they couldn't sell any international brands.''

Her guests were similarly disappointed at her favourite DVD stores and Hongqiao Market.

''At Hongqiao they said there's big trouble this week, come back next week,'' she said. ''So we went to the Great Wall instead.''

The pirating of fashion labels and cultural content upsets multinational companies but raises little concern among citizens in China. Mass outbreaks of fake food, counterfeit medicine and adulterated milk, on the other hand, cause outrage.

The minister in charge of the National Copyright Administration of China, Liu Minjie, praised conference delegates for their ''spirit of co-operation, flexibility and pragmatism''. Francis Gurry, director-general of the World Intellectual Property Organisation, praised China for ''outstanding organisation''.


Read more: http://www.theage.com.au/travel/travel-news/copyright-convention-spooks-beijings-pirates-20120627-212tg.html#ixzz1z5RljHrR

China praises Gillard Dalai Lama snub

Daniel Flitton, Guangdong, China
June 28, 2012 - 5:19PM

Chinese state-controlled media has heaped praise on Prime Minister Julia Gillard for refusing to met Tibet's Dalai Lama - singling out her break with the past practice of Australian leaders.

But a senior member of the People's Daily - a mouthpiece newspaper for the ruling Communist party - warned an officially sponsored media workshop that Australia's enhanced military ties to the US sent confusing signals to Chinese people.

Liu Huaxin, a committee member of international development at the People's Daily, told the meeting Ms Gillard's decision to snub the Dalai Lama has been "acclaimed" by China.

He also took the rare step of displaying a photograph of the Tibetan religious leader - whose image is almost never seen in China - showing him alongside a separate picture of Ms Gillard with an illustrated speech bubble saying "No!".

China has so far refused requests by Foreign Minister Bob Carr for Australian diplomats to visit Tibet to investigate human rights concerns.

The talks, the Australia China Media Forum, are being held in the southern province of Guangdong and include around 50 representatives of media from both countries and first took place in 2006.

The stated aim is to promote greater links with China's burgeoning media sector, which like in Australia, is undergoing a transformation fuelled by technological change.

But Chinese retains heavy censorship and media representatives are considered unlikely to stray into controversial issues without official imprimatur.

Mr Liu said through a translator there was a view Australia was "tied up to the chariot of the US and it was easy to get on but more difficult to get off".

He realed off a litany of complaints about Australia's attitudes to China, pointing to the decision to base 2500 US marines near Darwin, recent speculation about a secret chapter on war with China in Australia's 2009 military blueprint, banning Chinese company Huawei from investing in the National Broadband Network and plans for American surveilance drones take off from the Australian Indian ocean territory of Cocos Islands.

But he later clarified his remarks, saying he was reflecting general public perceptions, not official policy.

Former Australian ambassador to Beijing, Geoff Raby, told the forum he had no reason to doubt government denials of any secret China chapter in the 2009 Defence white paper.

He said he was "sanguine" about the US-China relationship and thought conflict was unlikely.

But he wanted Australia to do much more to acknowledge the importace of China and the media relationship was underdown, with no commercial TV corespondents from Australia based in China.

The talks also included discussion of promoting business ties and the role of social media in both countries.
Australia's present ambassador to China, Frances Adamson, said it was important not to fall back on stereotypes when reporting both countries.

China's State Council Information Office sponsored Daniel Flitton's travel to Guangdong.


Read more: http://www.theage.com.au/opinion/political-news/china-praises-gillard-dalai-lama-snub-20120628-214ww.html#ixzz1z5VC4YKP

Insight: the euro-zone crisis

Clancy Yeates
June 27, 2012

Greece makes up just 2 per cent of Europe's economy, but this clearly hasn't stopped the country unleashing havoc on financial markets.

So imagine the consequences of a much larger country in the euro zone - say, Italy or Spain - getting into serious strife.

This is the disaster scenario investors have been fretting about in recent weeks. And, unfortunately, these fears suggest the euro-zone crisis is likely to continue bubbling along for a while yet.

What's behind the latest round of European jitters?

Spain, the fourth-biggest euro-zone economy, is of particular concern. Its banks received a €100 billion ($125 billion) support package this month but it has done little to calm investors' nerves.

This month, Spanish government bond yields - the return investors are demanding for holding the nation's debt - hit their highest level since the country joined the euro zone. Italy's are also on the rise, though they are yet to hit the highs of last year.

The opposite has happened in Germany, the powerhouse of Europe, as investors flock to safer assets.

As these tremors are occurring, investors fear that Spain, in particular, is less likely to repay its substantial debts due to its prolonged recession.

Perversely, the market's fears can be self-fulfilling. A sharp rise in yields increases the cost of new borrowing by the government, making it even harder to refinance their debts.

There's no magic tipping point but, in the past, countries with bond yields above 7 per cent have often required bailouts.

Spanish government bond yields hit this level recently, and people in the markets are fretting that its government, too, might require a full-blown rescue package, as Ireland, Greece and Portugal did.

If this were to occur, the cost to Europe would be enormous and could raise further question marks over vulnerable economies such as Italy, which is even larger than Spain.

To an investor in Australia, all the fuss about Europe might seem a long way removed from our own economy.

But the arcane workings of bond markets are having a big impact on confidence and the fears look unlikely to disappear any time soon.


Read more: http://www.watoday.com.au/money/insight-the-eurozone-crisis-20120626-20z5v.html#ixzz1zFAJ3xc7

Free remaining child asylum-boat crew, Susilo Bambang Yudhoyono urges Julia Gillard

by: Ben Packham and Lanai Vasek From: The Australian July 03, 2012 5:12PM

The PM and the Indon President have acknowledged the relationship between the countries after early talks.

Sky News3 July 2012

INDONESIAN President Susilo Bambang Yudhoyono has called on Julia Gillard to release a further 54 underage asylum boat crew members held in Australia, as he and the Prime Minister agreed to enhance bilateral cooperation to fight people-smuggling.

Meeting in Darwin today, President Yudhoyono and Ms Gillard agreed to closer links between the two nations' maritime safety authorities to improve future responses to asylum boat tragedies.

The leaders also agreed to improve extradition arrangements between the two countries, building on an unfinalised extradition deal.

“In the field of preventing or combating people-smuggling and also human trafficking, we have agreed to enhance greater cooperation,” Mr Yudhoyono said.

He said Indonesia wanted to implement the 1992 extradition agreement, “with the hope that we can have extradition in a mutual way” of people-smuggling suspects.

Mr Yudhoyono said he welcomed Australia's release of more than 50 underage sailors who had acted as crew on asylum vessels, declaring “they are also victims of acts of people-smuggling”.

.“No doubt we hope that repatriation of the remaining underage seafarers can be accelerated,” he said.

“We hope another 54 will be released.”

As of last night there were 79 Indonesian crew members in Australian detention centres, many of whom claim to be minors.

Mr Yudhoyono's visit follows two recent asylum vessel sinkings and the Australian parliament's failure last week to agree on a way to stop the boats before they set sail.

Ms Gillard said: “The President and I discussed the importance of the Bali Process in combating people-smuggling.

“I welcome the cooperation we have with Indonesia on people-smuggling including Indonesia's law enforcement efforts against people-smuggling syndicates.”

http://www.theaustralian.com.au/national-affairs/immigration/free-remaining-child-asylum-boat-crew-susilo-bambang-yudhoyono-urges-julia-gillard/story-fn9hm1gu-1226415648686

China cuts interest rates to spur growth

July 5, 2012 - 9:40PM

China's central bank cut interest rates for the second time in two months on Thursday in the latest attempt to bolster slowing growth in the world's second-largest economy.

Benchmark lending rates will be lowered by 31 basis points to 6 per cent, and deposit rates will be reduced by 25 basis points to 3 per cent, the People's Bank of China said in a statement on its website.

The latest rate cut is effective from Friday. The central bank last cut interest rates on June 7.

In addition to cutting lending and deposit rates, the central bank took another step in liberalising interest rates by lowering the floor for lending rates to 70 per cent of benchmark rates, from 80 per cent previously.

Reuters


Read more: http://www.theage.com.au/business/china/china-cuts-interest-rates-to-spur-growth-20120705-21k9t.html#ixzz1zkQKkTXZ

Military eye-for-eye with USA still intact

TRACY WATKINS
Last updated 05:00 07/07/2012

So much for the charm offensive.

The news that its military refused to let our navy park its frigate at Pearl Harbour alongside America's own battleships somewhat undermined all the recent efforts to flossie up New Zealand-United States relations with the grand-sounding Wellington and Washington declarations.

The truth is, no-one should have been particularly surprised by the snub.

The US has backed down in every meaningful sense over its opposition to New Zealand's anti-nuclear legislation - high-level contact has been restored, intelligence sharing has resumed and there has been a return to joint military exercises and training between the two countries. But given that the nuclear-free legislation remains in place, and compromise has been a one-way street as far as America is concerned, there was always going to be one gesture held in reserve to demonstrate it still disagrees with New Zealand's stance, even if it no longer stands in the way of a working relationship between the two countries.

Silly? Petty? In New Zealand's eyes, of course. But if America tried to park a nuclear-powered aircraft carrier in our ports (assuming it would fit, of course) we wouldn't just politely ask it to park around the corner. We would tell it to turn the carrier around and send it home. So if the ban on our ships docking at US military ports is America's eye for an eye, it is also the retaliatory gesture that causes the least inconvenience to everyone. The odds are the ban will be lifted in the next few years anyway.

But of course, it doesn't help to dispel the notion that when it comes to relations between a minnow like New Zealand and the world's only superpower, bullying is the default position. It was US bullying that hardened New Zealand attitudes over the nuclear-free legislation in the first place, after all. Kiwis instinctively rebelled against the notion the US could tell them what to do.

Internet giant Kim Dotcom is fast turning into a cause celebre for similar reasons his case raises fundamental questions about the extent to which New Zealand sovereignty can or should withstand the full might, reach and self-interest of the United States.

After the High Court ruled that police bungled the case against Dotcom by executing illegal search warrants, Mr Key this week unconvincingly ducked calls for an inquiry into the escalating farce and insisted it wasn't New Zealand's problem anyway.

"It's really a matter for the United States and New Zealand is not taking a case against the guy," he argued. "It's just we have extradition treaties and we work through those."

Ad Feedback In other words, New Zealand doesn't have any beef with Dotcom and doesn't even know if he has actually committed any crimes. But it is happy to let US authorities cart a New Zealand resident off to America and remain a spectator to what happens next.

It is that, and not just the bungling of the police in the case so far, that has caused disquiet in most quarters.

Legally, Mr Key is probably right that Dotcom is not our problem. There's bound to be some arcane treaty clause we've signed up to that supports his view that New Zealand's hands are tied.

But there remain serious questions in the minds of many about whether there are sufficient checks and balances in place before a foreign government such as America can reach into New Zealand, pluck out a non-US citizen and try him back in America for alleged offences that arguably weren't committed on US soil.

There are parallels with another case in Britain, where 24-year-old student Richard O'Dwyer faces up to 10 years in a US prison for setting up a website linking to places to watch television online. Criminal copyright infringement carries a maximum sentence of six months in prison in Britain. O'Dwyer is fighting extradition to the US and has some top-level support, including from Conservative MP Dominic Raab, who points out that the US authorities have never let a US citizen be extradited to Britain for alleged crimes committed while on American soil.

Back here, the questions start at an even more basic level, such as who authorised the Hollywood-style raid on the Coatesville mansion where Dotcom lives with his wife, who was pregnant at the time, and his three children?

When armed police swooped on the property in helicopters and stormed the Coatesville home occupied by Dotcom and his family, the obvious assumption was he was either a criminal mastermind or violent thug.

The easy manner in which police let the cameras roll while they seized cash, computers, and art and hauled off lorry-loads of flash cars completely out of character for our traditionally media-shy boys in blue only reinforced that view. After all, when was the last time you saw police swoop on a gang pad and hotbed of drug dealing, violence and sexual abuse in similarly dramatic fashion?

But subsequent publicity about the nature of Dotcom's alleged crimes (which are to do with internet and copyright law) has left most people baffled and more than a little alarmed that someone can be ripped from their home, lose everything they own and be banged up in jail for a month awaiting extradition to a foreign country, for something most people would not consider a particularly heinous crime.

If there is a more than a sneaking suspicion that the FBI clicked its fingers and everyone from the solicitor-general down swooned on cue, then Mr Key's refusal to countenance an inquiry does nothing to dispel that.

If the CTV footage from Dotcom's home is released and supports the view that he had good reason to mistake the plainclothes officers kicking in doors and brandishing guns for kidnappers, then the case for an inquiry will be even more compelling.

Mr Key may yet have his hand forced anyway.

When Dotcom told his newly acquired 46,000 Twitter followers recently that he was sick as a dog, one asked incredulously: "A Superhero can get sick? C'mon Kim, you are kidding me!"

It's a reflection of the cult hero status that has attached itself to the giant German, helped along by a PR offensive, which includes posting tweets and pictures poking fun at his accusers.

As ACT MP John Banks discovered, buried not so deep beneath all that charm and flamboyance, Dotcom is a hard-nosed businessman who'll take no prisoners in his bid to clear his name.

After being hung out to dry by Dotcom over secret donations to his Auckland mayoral campaign, Mr Banks is a lame duck waiting out a police investigation into whether any criminal activity took place.

The question is where will Dotcom turn his sights next?

In a US interview this week, Dotcom who is promising an expose on the web linked the decision to shut down his MegaUpload site to the White House and political pressure from US movie studios.

How long before he turns his sights on our government and its cosy relationship with the US movie bosses?

As billionaire businessman Owen Glenn proved in his crusade against NZ First's Winston Peters, governments should never underestimate the damage a rich man with the means, motive and opportunity for revenge can inflict.

http://www.stuff.co.nz/dominion-post/comment/columnists/tracy-watkins/7236031/Military-eye-for-eye-with-USA-still-intact