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Christmas Corner post from Mark Steyn.
Stratfor’s George Friedman will give you a whole new way to look at Watergate and “deep throat.”
… The Felt experience is part of an ongoing story in which journalists’ guarantees of anonymity to sources allow leakers to control the news process. Protecting Deep Throat’s identity kept us from understanding the full dynamic of Watergate. We did not know that Deep Throat was running the FBI, we did not know the FBI was conducting surveillance on the White House, and we did not know that the Watergate scandal emerged not by dint of enterprising journalism, but because Felt had selected Woodward and Bernstein as his vehicle to bring Nixon down. And we did not know that the editor of The Washington Post allowed this to happen. We had a profoundly defective picture of the situation, as defective as the idea that Bob Woodward looks like Robert Redford.
Finding the truth of events containing secrets is always difficult, as we know all too well. There is no simple solution to this quandary. In intelligence, we dream of the well-placed source who will reveal important things to us. But we also are aware that the information provided is only the beginning of the story. The rest of the story involves the source’s motivation, and frequently that motivation is more important than the information provided. Understanding a source’s motivation is essential both to good intelligence and to journalism. In this case, keeping secret the source kept an entire — and critical — dimension of Watergate hidden for a generation. Whatever crimes Nixon committed, the FBI had spied on the president and leaked what it knew to The Washington Post in order to destroy him. The editor of The Washington Post knew that, as did Woodward and Bernstein. We do not begrudge them their prizes and accolades, but it would have been useful to know who handed them the story. In many ways, that story is as interesting as the one about all the president’s men.
London Times Op-Ed says it’s silly to blame capitalism for the economic mess caused by state intervention run amuck.
Corner post showing the normal effort to play up bad news and ignore the good.
The Economist profiles Viktor Bout, Russian arms dealer extraordinaire.
VIKTOR BOUT knew, long before his plane lifted off from Moscow, that they meant to snatch him. For years he had hunkered down in the Russian capital, making only rare forays abroad. Western spies, the United Nations and do-gooder activists were after him. They said that he had smashed arms embargoes and struck deals with a remarkable axis of ne’er-do-wells: supplying weapons and air-transport to the Taliban, abetting despots and revolutionaries in Africa and South America, aiding Hizbullah in Lebanon and Islamists in Somalia. He also found time to supply American forces in Iraq, perhaps al-Qaeda too, and maybe even Chechen rebels.
He denied all wrongdoing and, no doubt, thought his accusers irritating and hypocritical. But until the fuss died away he knew that he was safe only in Russia, from where extradition was impossible.
Yet Mr Bout, a puzzling, amoral and intelligent man, made a poor choice in March, leaving behind his wife and daughter and flying to Bangkok. As a consequence he may end up in New York as the star of a trial that would provoke echoes of cold-war spy games, further chilling relations between the West and Russia. …
Speaking of criminals, Marty Peretz takes a look a Clinton’s donor list.
This is not about former President Bill Clinton’s shakedown of the sheikhs. They can take care of themselves, Clinton Foundation or no Clinton Foundation.
This is also not about Hillary Clinton’s vulnerability to her husband’s donors. She can tell him to “go stuff it,” which people say she’s been doing for a long time anyway. Rest assured, the next secretary of state will not shirk her diplomatic obligations for the benefit of some scummy foreign mineral magnate’s uranium.
What I’ve been tying to discern about the Clinton Foundation is why — aside from the annual fancy party in New York — foreign governments, other foundations and charities have given money to fund what they already do themselves.
I understand why McDonald’s of central Arkansas would make a contribution to Mr. Clinton’s present career. He has spent so much cash on Big Macs over three decades that they actually owe it to him. But I fail to grasp why the “I Won’t Cheat” foundation gave a donation to Bill’s charity. He isn’t exactly an ideal poster boy. …
Sebastian Mallaby on some of the Madoff lessons.
For sheer toe-curling embarrassment, it may be a while before Wall Street does better than the Bernard Madoff scandal. Here was a rogue who practically telegraphed his unreliability by hiring a tiny, no-name audit firm, by reporting monthly investment results that never fluctuated and by claiming a trading strategy that could not possibly have been implemented given the billions of dollars he managed. And yet, despite these warnings, the rich, the famous and the supposedly sophisticated entrusted their money to Madoff, who defrauded them with the most laughably crude of methods — an old-fashioned Ponzi scam.
The question this prompts is not really about regulation, though some argue otherwise. Even if you define Madoff’s investment outfit as a hedge fund, which for various reasons is debatable, there’s nothing in this saga that supports clamping down on the industry.
Those who favor regulation of hedge funds start by insisting that they must register with the Securities and Exchange Commission. Well, Madoff had registered with the SEC voluntarily, and a fat lot of good it did. Those who support regulation also say that hedge funds should disclose more of what they do. Well, Madoff did make some disclosures; it’s just that they weren’t true. As SEC Chairman Chris Cox has all but admitted, the scandal doesn’t show that his agency lacked the power to regulate; it shows that it failed to exercise it. Responding to this scandal with more regulation would be like thrusting more pills on a patient who refuses medication.
The real question posed by this episode concerns the market’s response. Madoff illustrates a problem with investment outfits that claim to have some special sauce that is too valuable to discuss. People who entrusted their money to Madoff thought he had a clever options trading strategy; they were wrong. Worse, people who entrusted their money to respected banks and investment advisers had no idea that their savings were being passed out the back door to Madoff. On Monday, I happened to be visiting one of the most famous traders in Manhattan. He had invested with a hedge fund that had in turn invested with Madoff, hot-potato style. …
If you’re thinking the world’s economy is about to collapse, read the WSJ report on coming South Korean investments in electricity generation. $28.5 billion.
Dilbert says we’ve won the war against terrorists.
… When oil prices were high, most people assumed prices would stay high. So oil rich countries started investing and spending like crazy, getting their citizens and friends addicted to higher standards of living. When those countries need to pull back on that spending, where do you think they will cut first? I think it will be hard to fund terrorists when you can’t afford to pay the garbage man. And keep in mind that a successful terrorist attack on U.S. financial infrastructure could further lower the demand for oil.
I’m overstating the case, as I like to do, but I have to think it is becoming clear to everyone that a frail U.S. economy is bad news for everyone who would prefer driving a car over riding a camel.
On a related note, you haven’t heard much bravado from Chavez and Putin lately.