[US Oil Fund ETF via Google Finance]

The Curious Timing of Kushner’s visit to KSA and the U.S.’ EITI Exit

Trump’s son-in-law Jared Kushner — he of the shaky memory and a massive debt in need of refinancing — met with Crown Prince Mohammed bin Salman within the same week the U.S. withdrew from an anti-corruption effort and Saudi Arabia cracked down on corruption. What curious timing.

Let’s look at a short timeline of key events:

Tuesday 24-OCT-2017 — Saudi Arabia’s Crown Prince Mohammed bin Salman helms a three-day business development conference at the Ritz-Carlton in Riyadh, referred to as “Davos in the desert.” Attendees include large investment banks as well as fund representatives; one of the key topics is the impending IPO for Saudi Aramco.

Wednesday 25-OCT-2017 — Jared Kushner departed for an unpublicized meeting with government officials in Saudi Arabia.

Wednesday 25-OCT-2017 — Treasury Secretary Steve Mnuchin and Undersecretary for Terrorism and Financial Intelligence Sigal Mandelker traveled separately from Kushner to participate in bilateral discussions, which included the memorandum of understanding with the Terrorist Financing Targeting Center (TFTC). The U.S. and Saudi Arabia chair the TFTC while Gulf States form its membership.

Friday 27-OCT-2017 — Reports emerged that at least one Trump campaign team will be indicted on Monday.

Monday 30-OCT-2017 — Jared Kushner met with Crown Prince Mohammed bin Salman, discussing strategy until 4:00 am. News reports didn’t indicate when exactly Kushner arrived or when discussions began. (Paul Manafort, Rick Gates, George Papadopolous were indicted this day, but not Kushner; good thing “excellent guy” Papadopolous as a former Trump campaign “energy and oil consultant” wasn’t involved in Kushner’s work with Saudi Arabia, that we know of.)

Thursday 02-NOV-2017 — U.S. Office of Natural Resources Revenue sent a letter to the Extractive Industries Transparency Initiative (EITI), a multinational effort to reduce corruption by increasing transparency around payments made by fossil fuel companies to foreign governments. The U.S. had been an implementing member since 2014.

Saturday 04-NOV-2017 — At 7:49 am EDT, Trump tweets,

“Would very much appreciate Saudi Arabia doing their IPO of Aramco with the New York Stock Exchange. Important to the United States!”

Saturday 04-NOV-2017 — (approximately 5:00 pm EDT, midnight Riyadh local time) At least 10 Saudi princes and dozens of government ministers were arrested and detained under what has been reported as an anti-corruption initiative. Prince Alwaleed Bin Talal, a critic of Trump and a tech industry investor of note, was among those arrested this weekend.

Saturday 04-NOV-2017 — At 11:12 pm EDT Reuters reported Trump said he had spoken with King Salman bin Abdulaziz about listing Saudi Aramco on the NYSE. The IPO is expected to be the largest offering ever.

But wait…there are some much earlier events which should be inserted in this timeline:

Friday 03-FEB-2017 — Using the Congressional Review Act to fast track their effort, Senate passes a joint resolution already approved by the house, disproving the Securities and Exchange Commission’s Rule 13q-1, which implemented Section 1504 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Section 1504, the bipartisan product of former senator Richard Lugar and Sen. Ben Cardin (now ranking Democrat on the Foreign Relations Committee),

“…a public company that qualified as a “resource extraction issuer” would have been required to publicly disclose in an annual report on Form SD information relating to any single “payment” or series of related “payments” made by the issuer, its subsidiaries or controlled entities of $100,000 or more during the fiscal year covered by the Form SD to a “foreign government” or the U.S. Federal government for the “commercial development of oil, natural gas, or minerals” on a “project”-by-“project” basis. Resource extraction issuers were not required to comply with the rule until their first fiscal year ending on or after September 30, 2018 and their first report on Form SD was not due until 150 days after such fiscal year end.” (source: National Law Review)

Section 1504 and SEC rule 13q-1 enacted the U.S.’ participation in the EITI’s anti-corruption effort.

Monday 13-FEB-2017 — Trump signed the disproving resolution. (Probably just another coincidence that Michael Flynn resigned this day as National Security Adviser.)

From the earliest days of this administration, both the Trump White House and the GOP-led Congress have been ensuring that extractive industries including oil companies will not be accountable for taxes, fees, and other miscellaneous payments (read: dark money donations and bribes, the latter being a bone of contention to Trump) paid to foreign governments.

Some of the immediate beneficiaries are Exxon Mobil, for which Secretary of State Rex Tillerson used to work, and the Koch brothers, among U.S. oil companies which claimed additional reporting requirements under Rule 13q-1 would make them less competitive with overseas oil producers.

What’s not yet clear: How is this reduced openness supposed to help track financing of terrorism, which Treasury was supposed to be working on?

What of transparency related to arms deals involving Saudi money or Aramco? What of transactions between U.S. oil companies and other foreign companies involved in deals with Russian fossil fuel firms like Gazprom?

Can Trump, Jared Kushner, their family and minions, and members of Congress profit from this increased lack of transparency?

What happens to the U.S. and global economy when oil prices rise without adequate transparency to the market to explain price increases?

Also not yet clear: what happened to the 19.5% stake in Rosneft sold last year, allegedly bought by Qatar’s sovereign wealth fund and Glencore (the same Glencore now embroiled in Paradise Papers scandal)? This massive chunk of Russia’s largest oil company has increased in value in tandem with crude oil’s rise, especially since the Saudi crackdown on Saturday. What’s to keep this massive amount of Rosneft shares from being laundered through stock markets as Deutsche Bank did between 2011 and 2015?

It’s all just so curious, the unanswered questions, the odd timing: Aided and abetted by GOP-led Congress, Trump pulls out of an anti-corruption initiative while Treasury Department appears to work on anti-corruption, and Kushner meets on the sly with the Saudi crown prince just days before an anti-corruption crackdown.

Hmm.

Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.

Three Things: Mas Gas, Las Vegas and Sass

I’m not even going to touch the massive stream of news out of Washington over the last 24 hours, from the Washington Post piece featuring ‘leaked’ transcripts of Trump’s whack doodle conversations with Mexico’s and Australia’s presidents to the impaneled grand jury and subpoenas. Plenty of other material not getting adequate air time.

Speaking of air time, hope you have a chance to catch Marcy on Democracy Now. She spoke with Amy Goodman about the confirmation of Chris Wray as FBI Director as well as former Fox News contributor Rod Wheeler’s lawsuit against Fox News.

Onward…

~ 3 ~

Venezuela’s state-run oil producer PDVSA is cutting oil sales to U.S. refining unit Citgo Petroleum. At the same time it is increasing shipments of oil to Russia’s largest oil producer, Rosneft. Venezuela is using its oil to pay down a $1.6 billion loan extended to PDVSA last year. Rosneft has loaned an even larger sum of money in the not-too-distant past, but the terms aren’t known; payments in oil as well as a hefty minority stake in Citgo were believed to be included in negotiations.

The threat to U.S. gasoline supply: though at lower levels than a decade ago, Venezuela is the third largest supplier of oil to the U.S.

Citgo has, however, been shifting its purchasing wider afield than just PDVSA:

Citgo last year started sending gasoline and other fuels to Venezuela in exchange for a portion of its crude supply. But Citgo has increased the volume of U.S. oil it refines, and has also has also expanded its crude import sources.
[…]
U.S. President Donald Trump’s administration has promised strong economic sanctions against Venezuela’s government after a Constituent Assembly was elected last week in what United States called a “sham” vote. The new body will have power to rewrite the constitution and abolish the opposition-led Congress.

If those sanctions were to constrain Venezuela’s oil shipments to the United States, Citgo could be ahead of its competitors in finding new supply sources.

The public will feel at the pump whatever happens to Citgo and other gasoline producers. Gasoline prices are already $0.16-0.24 per gallon higher than they were last year.

Who is profiting from this?

~ 2 ~

I’ve been thinking about the tagline, “What happens in Vegas, stays in Vegas” right about now after the arrest of Marcus Hutchins, a.k.a. MalwareTechBlog following Defcon’s end in Las Vegas. You’ve probably read Marcy’s piece already (catch up if you didn’t); since she published her post the information security community has been digging into Hutchins’ past and stewing about why/what/how.

Some speculate this was an aggressive recruitment effort; this might explain why the U.K. didn’t arrest him before he left for Defcon. Or did the U.K. and the U.S. agree not to spook any Defcon attendees by stopping Hutchins before he arrived in Vegas? Responses by U.K. authorities are annoyingly banal:

A spokesman for the Foreign and Commonwealth Office said: “We are in touch with local authorities in Las Vegas following reports of a British man being arrested.”

The UK’s National Crime Agency said: “We are aware a UK national has been arrested but it’s a matter for the authorities in the US.”

Others speculate he was framed as the target of revenge by someone caught up in Alphabay’s seizure. How does shutting down WannaCry fit into this scenario?

I don’t have a favorite theory right now. All I know is that WannaCry’s heat map sticks in my craw.

One thing which should come out of this situation is a dialog about coding, malware, and intent; the infosec community is having that discussion now, but it needs to be wider. If a white hat codes malware in part or whole to investigate capabilities, they are only separated from criminal malware producers/sellers/distributors by intent. How does law enforcement determine intent?

~ 1 ~

Your opinion is constantly shaped by the media you consume. Some consumers aren’t conscious of this shaping; neither are some producers.

And some producers know it but are just plain jerks.

A very important way in which opinion is shaped is by the perspective presenting a viewpoint. If only the members of one-half of the population ever gets a chance to present a perspective, consumers’ opinions are narrowed by that same factor. This is why gender equity in media is critical; if you’re only hearing men you’re not getting but part of the picture.

WIRED magazine knows that gender equity in content is important, but their last issue contained only male-written content. As a twisted tribute to the women who helped produce the issue, WIRED stuck a colophon listing important females.

Including a dog.

Really? The women of WIRED are on the same footing as a pet?

Somebody/ies at WIRED need a kick in the sass; I don’t give a fig if half the staff is female if the content itself is all-male. I’m going to do my best this next month not to cite WIRED.

Don’t think for a moment this is just WIRED, either. The VIDA Count measures annually gender equity in literary arts. There’s progress though slow.

~ 0 ~

That’s a wrap on this open thread. Let’s hope with Tiny Hands McGolfer on vacation that news slows a bit as we enter this weekend. I’m not holding my breath though. Behave.

Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.

Three Things: Bad, Worse, and Just Deal Already

I’ve got to run some errands, only have time for a very quick three things post.

~ 3 ~

Because Trump wants a cheaper Air Force One, the Air Force bought a bankrupt Russian company’s canceled Boeing 747s.

Why does this sound like 1) a crap deal which doesn’t solve the need for an attack-resistant AF1, 2) a bail-out for some entity, whether Boeing or whoever in Russia is holding the bag on the down payment?

~ 2 ~

A few days ago I read yet another right-wing character assassination attempt aimed at Robert Mueller, distributing disinformation related to Russia and radioactive materials. Real story completely stretched beyond recognition to attack the special counsel looking into Trump-Russia.

Meanwhile, the Los Alamos National Laboratory has improperly MAILED radioactive materials repeatedly.

This highlights our long-term problems with outsourcing nuclear sites’ management to private contractors.

Please let’s not allow Trump cut a deal on this matter. It’s bad enough we have Dancing With The Stars’ Rick Perry involved in any way. And watch for more disinfo about Robert Mueller as the Trump-Russia investigation heats up.

~ 1 ~

Baltimore Ravens need to get off it and hire Colin Kaepernick. Baltimore the city needs him. Not only is Kaepernick a good Plan B because of Joe Flacco’s back, the Ravens need a reset on their image — many women still don’t have a high opinion of the Ravens (or the NFL) after the Ray Rice scandal. And Kaepernick is a solid player worth watching; he doesn’t deserve the racist bullshit he’s received from the NFL, quietly blacklisted for exercising his First Amendment rights. Football isn’t slavery demanding forfeit of human rights, after all — or is it?

~ 0 ~

Off to run the roads. This is an open thread. Behave.

Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.

Three Things: Killing Oil, Too Money, Kaspersky’s World

Too much going on here today but the existing threads are getting too deep and a couple are drifting off-topic. Here’s three quick things to chew on and an open thread.

~ 3 ~

The marketplace will bring death to oil long before the government. (Bloomberg). But will governments — US and oil-producing countries alike — get in the way of alternative energy in spite of the market demanding more alternatives to fossil fuels? With this trend away from combustion engines pressing on them, fossil fuel producers are shifting toward increased LNG for use in electricity production; this only shifts CO2 creation from vehicles to power plants. Will the market put an end to that, too?

~ 2 ~

There’s too much money out there if Delta can order multiple planes configured for all-first class service. I just spoke with a friend earlier today about round-trip fares from a major Midwest airport to major cities in Europe; they were quite high even with a departure date more than a month out, and higher than they had seen in a while. Fuel prices haven’t increased that much over the last year; low oil prices are threatening pipelines as financing construction costs more than the return on oil. Somewhere between slack fuel prices, firm fares and demand, Delta’s making enough money to build these let-them-eat-cake planes.

One could argue that if buyers have the money they can have whatever they want — except that taxpayers finance the infrastructure including essential safety regulatory system which will now protect the few and not the many while increasing congestion. Too money — somebody needs to pay more taxes to support the infrastructure they’re using.

~ 1 ~

Kaspersky Labs is releasing around the globe a free version of their antivirus software (Reuters). It won’t replace the paid version of their AV software, providing only very basic protection. I’m not using it, though, for two reasons: if it’s like Kaspersky’s existing free tool, it will send messages back to the parent company about infections it finds — and possibly more. Congress and the U.S. intelligence community may have concerns about Kaspersky Lab’s vulnerability to the Russian government; I’m more concerned about Kaspersky Lab having been breached at least once in 2015, compromising data in their systems. Your mileage may vary; use under advisement.

~ 0 ~

That’s it for now. This is an open thread. Behave.

P.S. The fight against attacks on the health care system isn’t over. Call your senator at (202) 224-3121. Other tools for your use in this post.

Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.

Death of the Car(go) Cult(ure)

I had an epiphany recently. It sneaked up on me, right about the time I let go of my comfortable illusion of middle-class security and embraced the fact I may be faced with more than $26,000 per year in health care premiums and untold thousands in out-of-pocket deductibles and medication expenses. It could be more than my household income, forcing me to draw down on retirement savings nearly ten years prematurely.

Ticking off monthly expenses — what things could be reduced or eliminated in my household to make up for the additional health care expenses if some mutant abomination of AHCA passes — I came to an abrupt conclusion.

I don’t need a car anymore.

It costs more to own a car at my personal disposal than calling a car-for-hire, whether Uber or Lyft or local cab service.

I had to sit down after that. For nearly fifty years I’ve thought I needed a car, that every American aspired to vehicle ownership, save for big city residents for whom cars would be unmanageable. My entrance to adulthood was marked by the ability to drive a car; my personal freedom hinged upon being able to get away in my own vehicle.

But now? I might be trapped by a car. My six-year-old grocery-getter Mom mobile cost me more than I invested in the stock market the year it was manufactured — it’s worth a fraction of its original value, while my stock is worth several times over. My investment in wheels won’t pay for my future health.

I thought about my kids and the reality they face; only four years separates these two siblings, but a massive cultural shift occurred between them. My 23-year-old daughter drove off like the wind when I gave her my car keys seven years ago; she saw her first vehicle as freedom, just as I did when I was her age. She just signed her first lease on a vehicle, though; after crunching the numbers on new cars, it didn’t make sense to buy one. Leasing a car would yield a lower total cost to operate than buying one. She’s also not stuck with trying to sell it in a couple years when an electric vehicle might be preferred.

This isn’t an earth-shattering shift, but it’s a tectonic move; no one in my family has ever leased a vehicle. We have always bought and owned them over the last four generations.

And now my son. One might assume he was a car buff living here in the backyard of the Big Three Automakers, the progeny of one family which made its fortunes in auto parts and spawn of another family in which two successive generations made a living engineering in automobile manufacturing.

But no — he dragged his feet for nearly three years getting his license. He just didn’t care to get it; the only reason he got a driver’s permit was that everyone else his age had done so. He had the public school bus to get him to class every day, and me to get him to every intramural event. Why should he bother when he had it so good?

Especially when it came to the annoying expense of having his own vehicle. Being in a high-risk group — male, 16-25, driving more than 25 miles a week — he might pay more in insurance each year than the purchase price of the car he would drive. And then gas, which was near $4.00/gallon when he got his permit. And car washes, tires, wipers, oil changes, other increasingly frequent car repairs, and so on…this was not freedom.

His sister had been fortunate to land an internship for the duration of her college career, which helped defray automobile expenses. This has not been the case for her brother because of their different academic pursuits. He works at a summer job, stashing as much of his paycheck away for the academic year while living on his tips during the season. The paycheck and tips combined from his summer service job do not equal the amount his sister made each year; he simply cannot afford a car of his own.

We don’t know how long this may be the case, either. His prospects are different from his sister’s given his field of study. He may need to pursue a master’s degree immediately after he gets his bachelor’s. Leads on internships for his junior year of college are good, but the pay may be less than his sister made at the same point in their studies. A car of his own is a very iffy prospect for years.

Let’s face it: my son’s life is closer to that of the overwhelming number of American’s his age than my daughter’s is to her cohort. This is the shift in our culture, one in which we begin to let go of personal and family automobiles as a norm.

The more I thought about it, the more disturbed I became. Both of my kids will leave college without any debt; I spent what should probably have been my retirement health care savings on their tuition and board. In contrast, my prospective son-in-law carries $40,000 in debt after his graduation this month. Thankfully he has a good job and can pay it down quickly, but what of all other college students in the U.S.? The overwhelming majority will be saddled with a similar or greater amount of debt and middling jobs. They’re part of nearly 50% of America which cannot muster $400 cash in the event of an emergency, perhaps part of the 53% participating in the stock market but still one of the precarious.

These youngsters will be hard pressed to juggle health insurance premiums and deductibles under AHCA with massive college tuition debt and rising rents.

They will be hard pressed to buy a car outright. Screw all of those idiotic “Millennials are killing everything!” opinion pieces; their parents and grandparents have done little to ensure college would not burden them as much or more than an automobile payment.

Or a mortgage. I realized, too, that I am financing and paying taxes on a garage and a driveway I rarely use. I must trek out and shovel tons of snow every year to keep that rarely-used driveway clean; when it’s too much to do by hand, I break out the gas-guzzling, exhaust-belching snowblower.

All in service to a rapidly depreciating fossil-fueled demi-god with a deteriorating finish and in need of an oil change. I’ve become an adherent of a cargo cult, who has for too long believed that possessing this object would yield some greater blessing from the great god of capitalism. Instead of throwing several handfuls of dollars per mile traveled into a gaping maw I should be riding my bike or taking a bus.

When the rest of the U.S. wakes up to this same reality, the real earth-shattering shift will begin. Perhaps it already has.

What happens to a people when they lose their religion? We’re about to find out.
__________
Food for thought:
U.S. automakers question possible excess capacity – but is the challenge too much manufacturing capacity or too little buyers’ capacity due to decades of stagnant wages?

If carmakers like Volvo are already committed to switching completely to electric while entire cities and countries are forcing fossil fuel’s phase out, are potential car buyers simply driving their gas guzzlers to death until the industry has completely migrated?

Or maybe the future isn’t on the road but in the air; will buyers save their pennies for a flying car?

Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.

Did NSA Just Reveal Its China BIOS Story Was Made Up?

Secrecy News just released an NSA notice to Congress of authorized disclosure of classified information. The notice was dated December 13, just two days before 60 Minutes had a solicitous piece on the NSA.

Here’s the classified information the NSA says they gave what must be 60 Minutes.

The reference to assisting in locating hostages probably map to the metadata analysis of pirates done onscreen (albeit with altered phone numbers).

But what’s not there in unredacted form — at least beyond the vague description of “USG efforts to mitigate cyber threats” was the China kaboom story told on the show.

John Miller: Could a foreign country tomorrow topple our financial system?

Gen. Keith Alexander: I believe that a foreign nation could impact and destroy major portions of our financial system, yes.

John Miller: How much of it could we stop?

Gen. Keith Alexander: Well, right now it would be difficult to stop it because our ability to see it is limited.

One they did see coming was called the BIOS Plot. It could have been catastrophic for the United States. While the NSA would not name the country behind it, cyber security experts briefed on the operation told us it was China. Debora Plunkett directs cyber defense for the NSA and for the first time, discusses the agency’s role in discovering the plot.

Debora Plunkett: One of our analysts actually saw that the nation state had the intention to develop and to deliver, to actually use this capability– to destroy computers.

John Miller: To destroy computers.

Debora Plunkett: To destroy computers. So the BIOS is a basic input, output system. It’s, like, the foundational component firmware of a computer. You start your computer up. The BIOS kicks in. It activates hardware. It activates the operating system. It turns on the computer.

This is the BIOS system which starts most computers. The attack would have been disguised as a request for a software update. If the user agreed, the virus would’ve infected the computer.

John Miller: So, this basically would have gone into the system that starts up the computer, runs the systems, tells it what to do.

Debora Plunkett: That’s right.

John Miller: –and basically turned it into a cinderblock.

Debora Plunkett: A brick.

John Miller: And after that, there wouldn’t be much you could do with that computer.

Debora Plunkett: That’s right. Think about the impact of that across the entire globe. It could literally take down the U.S. economy.

John Miller: I don’t mean to be flip about this. But it has a kind of a little Dr. Evil quality– to it that, “I’m going to develop a program that can destroy every computer in the world.” It sounds almost unbelievable.

Debora Plunkett: Don’t be fooled. There are absolutely nation states who have the capability and the intentions to do just that.

John Miller: And based on what you learned here at NSA. Would it have worked?

Debora Plunkett: We believe it would have. Yes.

As I noted at the time, the story — the claim that a country of 1.3 billion people who have become very interdependent with the United States would want to destroy the US economy — was a bit absurd.

I’ll need to go back and review this, but the jist of the scary claim at the heart of the report is that the NSA caught China planning a BIOS plot to shut down the global economy.

To.

Shut.

Down.

The.

Global.

Economy.

Of course, if that happened, it’d mean a goodly percentage of China’s 1.3 billion people would go hungry, which would lead to unbelievable chaos in China, which would mean the collapse of the state in China, the one thing the Chinese elite want to prevent more than anything.

But the NSA wants us to believe that this was actually going to happen.

That China was effectively going to set off a global suicide bomb. Strap on the economy in a cyber-suicide vest and … KABOOOOOOOM!

And the NSA heroically thwarted that attack.

That’s what they want us to believe and some people who call themselves reporters are reporting as fact.

Anyway, like I said, no unredacted mention that this was among the classified information shared with CBS. Even accounting for the fact that NSA didn’t identify the country in question to CBS, even the description of the plot would seem to be classified.

If it were true.

But it doesn’t appear on the list of classified things revealed to CBS.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

While America Debates Rex Tillerson Nomination, Saudis and Russians Join Hands to Raise Oil Prices

At about 10:46 yesterday morning, Andrea Mitchell reported that ExxonMobil CEO Rex Tillerson was expected to be named Donald Trump’s Secretary of State.

Donald Trump is expected to nominate ExxonMobil CEO Rex Tillerson as his secretary of state, two sources close to the transition process told NBC News on Saturday.

The 64-year-old veteran oil executive has no government or diplomatic experience, although he has ties to Russian President Vladimir Putin. The pick would put to rest weeks-long speculation of who would earn the post as the U.S.’s top diplomat, and would place Tillerson fourth in line to the presidency.

[snip]

Tillerson, of Wichita Falls, Texas, has already notified his corporate board about taking on the new role, sources told NBC News.

Since then, the chattering class has discussed the Tillerson nomination at length, focusing mostly on his close ties to Vladimir Putin (see this report by Steve Coll, who wrote a book on Exxon’s private empire), not the fact that such a nomination would further demonstrate that Trump plans on reversing any efforts to mitigate the effects of climate change as President. Curiously, Russian hawks turned oil company players Condi Rice and Robert Gates reportedly recommended him. In the face of a potentially problematic confirmation battle, Trump’s campaign has since tried to deflate that trial balloon, suggesting the pick won’t be announced for another few days.

While the chattering class was focusing on Tillerson and on competing stories about why Russia hacked Hillary Clinton’s team, something else was happening: oil states were agreeing to cut production. At first, yesterday morning before Mitchell’s scoop, it was just the Saudi led OPEC states, making good on a plan announced November 30.

But then, yesterday afternoon, something unexpected happened. Russia and other non-OPEC petro-states joined in, and Saudi Arabia claimed it would cut production even further.

Saudi Arabia signaled it’s ready to cut oil production more than expected, a surprise announcement made minutes after Russia and several non-other OPEC countries pledged to curb output next year.

Taken together, the Organization of Petroleum Exporting Countries’s first deal with its rivals since 2001 and the Saudi comments represent a forceful effort by producers to wrest back control of the global oil market, depressed by persistent oversupply and record inventories.

“This is shock and awe by Saudi Arabia,” said Amrita Sen, chief oil analyst at Energy Aspects Ltd. in London. “It shows the commitment of Riyadh to rebalance the market and should end concerns about OPEC delivering the deal.”

Oil prices have surged more than 15 percent since OPEC announced Nov. 30 it will cut production for the first time in eight years, rising this week briefly above $55. The price rise has propelled the shares of energy groups from Exxon Mobil Corp. to shale firms such as Continental Resources Inc.

[snip]

[N]on-OPEC countries agreed to reduce production by 558,000 barrels a day, suggesting he had been waiting for the deal before committing to further cuts. The non-OPEC reduction is equal to the anticipated demand growth next year in China and India, according to data from the International Energy Agency.

We’ll see whether these commitments actually take place; such promises have a way of being broken, or at least cheated on.

Nevertheless, this signals that the petro-states — even those that worked to get Trump and his petro-cabinet elected — are finally going to work in concert to raise prices again.

Throughout the election, I kept remembering the Saudis could do such a thing, which would have tanked Obama’s “recovery.” High gas prices in 2008 were already making things difficult for John McCain, even before Wall Street crashed the global economy.

They waited, but even with dirt cheap oil prices, the pro-Saudi candidate lost.

Now prices are likely to go up — maybe not all that much, but consumers won’t be paying $2.50 for gas anymore, which will make their economic malaise all the worse.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

Monday: A Border Too Far

In this roundup: Turkey, pipelines, and a border not meant to be crossed.

It’s nearly the end of the final Monday of 2016’s General Election campaign season. This shit show is nearly over. Thank every greater power in the universe we made it this far through these cumulative horrors.

Speaking of horrors, this Monday’s movie short is just that — a simple horror film, complete with plenty of bloody gritty gore. Rating on it is mature, not for any adult content but for its violence. The film is about illegal immigrants who want more from life, but it plays with the concepts of alien identity and zombie-ism. Who are the illegals, the aliens, the zombies? What is the nature of the predator and their prey? Does a rational explanation for the existence of the monstrous legitimize the horror they perpetuate in any way?

The logline for this film includes an even shorter tag line: Some borders aren’t meant to be crossed. This is worth meditating on after the horrors we’ve seen this past six months. Immigrants and refugees aren’t the monsters. And women aren’t feeble creatures to be marginalized and counted out.

Should also point out this film’s production team is mostly Latin American. This is the near-future of American storytelling and film. I can’t wait for more.

Tough Turkey
The situation in Turkey is extremely challenging, requiring diplomacy a certain Cheeto-headed candidate is not up to handling and will screw up if he places his own interests ahead of that of the U.S. and the rest of the world.

  • Luxembourg’s foreign minister compares Erdoğan’s purge to Nazi Germany (Deutsche Welle) — Yeah, I can’t argue with this when a political party representing an ethnic minority and a group sharing religious dogma are targeted for removal from jobs, arrest and detention.
  • Op-Ed: Erdoğan targeting critics of all kinds (Guardian) — Yup. Media, judges, teachers, persons of Kurdish heritage or Gulenist religious bent, secularists, you name it. Power consolidation in progress. Democracy, my left foot.
  • HDP boycotts Turkish parliament after the arrest of its leaders (BBC) — Erdoğan claimed the arrested HDP leaders were in cahoot with the PKK, a Kurdish group identified as a terrorist organization. You’ll recall HDP represents much of Turkey’s Kurdish minority. But Erdoğan also said he doesn’t care if the EU calls him a dictator; he said the EU abets terrorism. Sure. Tell the cities of Paris and Brussels that one. Think Erdoğan has been taking notes from Trump.
  • U.S. and Turkish military leaders meet to work out Kurd-led ops against ISIS (Guardian) — Awkward. Turkish military officials were still tetchy about an arrangement in which Kurdish forces would act against ISIS in Raqqa, Syria, about 100 miles east of Aleppo. The People’s Protection Units (YPG) militia — the Kurdish forces — will work in concert with Arab members of Syrian Democratic Forces (SDF) coalition in Raqqa to remove ISIS. Initial blame aimed at the PKK for a car bomb after HDP members were arrested heightened existing tensions between Erdoğan loyalists and the Kurds, though ISIS later took responsibility for the deadly blast. Depending on whose take one reads, the Arab part of SDF will lead the effort versus any Kurdish forces. Turkey attacked YPG forces back in August while YPG and Turkey were both supposed to be routing ISIS.

In the background behind Erdoğan’s moves to consolidate power under the Turkish presidency and the fight to eliminate ISIS from Syria and neighboring territory, there is a struggle for control of oil and gas moving through or by Turkey.

Russia lost considerable revenue after oil prices crashed in 2014. A weak ruble has helped but to replace lost revenue based on oil’s price, Russia has increased output to record levels. Increase supply only reduces price, especially when Saudi Arabia, OPEC producers, and Iran cannot agree upon and implement a production limit. If Russia will not likewise agree to production curbs, oil prices will remain low and Russia’s revenues will continue to flag.

Increasing pipelines for both oil and gas could bolster revenues, however. Russia can literally throttle supply near its end of hydrocarbon pipelines and force buyers in the EU and everywhere in between to pay higher rates — the history of Ukrainian-Russian pipeline disputes demonstrates this strategy. Bypassing Ukraine altogether would help Russia avoid both established rates and conflict there with the west. The opportunities encourage Putin to deal with Erdoğan, renormalizing relations after Turkey shot down a Russian jet last November. Russia and Turkey had met in summer of 2015 to discuss a new gas pipeline; they’ve now met again in August and in October to return to plans for funding the same pipeline.

A previous pipeline ‘war’ between Russia and the west ended in late 2014. This conflict may only have been paused, though. Between Russia’s pressure to sell more hydrocarbons to the EU, threats to pipelines from PKK-attributed terrorism and ISIS warfare near Turkey’s southwestern border, and implications that Erdoğan has been involved in ISIS’ sales of oil to the EU, Erdoğan may be willing to drop pursuit of EU membership to gain more internal control and profit from Russia’s desire for more hydrocarbon revenues. In the middle of all this mess, Erdoğan has expressed a desire to reinstate the death penalty for alleged coup plotters and dissenters — a border too far for EU membership since death penalty is not permitted by EU law.

This situation requires far more diplomatic skill than certain presidential candidates will be able to muster. Certainly not from a candidate who doesn’t know what Aleppo is, and certainly not from a candidate who thinks he is the only solution to every problem.

Cybery miscellany

That’s it for now. I’ll put up an open thread dedicated to all things election in the morning. Brace yourselves.

Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.

Friday: Fusion

In this roundup: Dakota Access Pipeline news, Hawaiian sovereignty and other indigenous peoples news, the death of space art, and fusion jazz.

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Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.

Thursday: Another Grungey Anniversary Observed

In this roundup: Recalling 25 years of Nirvana’s Nevermind, petro-pipeline-economic challenges, lead poisoning, anthrax, and cops gone wild. Read more

Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.