Benjamin C. Works, Executive Director

--Celebrating Chaos Theory Since 1990--

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Benjamin C. Works, Director

718 937-2092; E-mail: Benworks@AOL.Com

--Celebrating Chaos Theory Since 1990--

SIT 9-18; Friday, September 18, 1998

- Bion; from Plutarch; Water and Land Animals

To the great, we are the frogs: the citizenry, particularly the soldiers, are the tokens of their self-esteem needs, crowds and votes, blood and deaths these are the tally strokes on the Great Leader's score card --in our Mr. Clinton's case, dangerous liaisons count, too. Serbian Americans are outraged to confirm in the Starr transcript that Mr. Clinton was receiving fellatio ("pushi kuracz") from Ms Lewinsky while discussing planned NATO strikes on Bosnian Serb targets with a Congressman --civilians also died in those strikes. I apologize to any ladies offended and to the good clerics of Decani and Texas for the vulgarism; but Serb Americans and Yugoslavs will get the irony when they consider Mrs. Clinton's anti-smoking stance and Monica's love of cigars. Hint to Americans and others: "pushi" (spelled phonetically) means "smoke," an interesting idiomatic peculiarity.

Serbs and Serbian Americans are again fretful of threatened NATO strikes on Kosovo, but as we see, that threat has receded against the vastly more complicated and more likely crisis between Iran and Pakistan, which could draw India and, in extremis, Iraq into a major South Asian continental war. Threats against Belgrade are pro forma saber rattling with northern Albania in convulsion.

The seriousness of Iran's threats has caused, in the last three days, a most interesting diplomatic flurry, indicating a high-stakes game of chicken is being played with the object of effecting a big game of diplomatic swap-arounds. Still, an actor could make a mistake and a convulsion could erupt.

That Saddam is working again to grind the US and UN down anyway, is an additional embellishment to consider

Note: Tom Sparico and I were talking yesterday about our long association, predating SIRIUS' formal establishment by three years, and dating to the Crash of 1987. So we decided to modify the bannerhead motto accordingly. Current readers are hereby advised and future readers won't be bamboozled.

The substance of our ruminations was about global financial-markets policy going forward and some signs of order are discernable, though the market sold down on Thursday --it is a traders-rumor driven market, after all.

The most important element we discussed was actually provided by a Capitol Hill staffer who noted that Mr. Clinton has capitalized on the expanding economy and rising stock market to justify his "legacy" since January 1993, though the market rally only started after the Republicans won majorities in both houses of Congress in November 1994. On Monday, in one of Mr. Clinton's most masterful "volto faces" (about-turns), suddenly the President justified his tenure in the face of the Starr report in terms of saving the world from the global financial crisis his careless and casual policy makers had done so much to help create. And his 180-degree turn was largely accepted. Smooth.

But a reporter had another view expressed in "Foreign Policy also takes a Hit," by Brian Mitchell, in yesterday's Investor's Business Daily:

"In his first public appearance since the release of Independent Counsel Kenneth Starr's report, President Clinton was upstaged by Treasury Secretary Robert Rubin.

"Appearing before the usually friendly Council on Foreign Relations in New York this week, Clinton spoke of the ''biggest financial challenge facing the world in a half-century.''

"But the response was merely polite. Not once was he interrupted by applause. Rubin received a warmer welcome, with sustained applause.

"That Rubin is so trusted is small comfort for those who think President Clinton is too busy with personal problems to steer the ship of state·"

© Copyright Sept. 17, 1998; The Investors Business Daily

The Wall Street Journal's lead editorial on Thursday also laid blame on the Clinton team for creating the Asian crisis through neglect and incompetence, particularly with Japan.

It was not Alan Greenspan who contributed to the problem and he is now in charge of the solution. It was Treasury Secretary Rubin acting for the Wall Street trader-buccaneers, our Trade Representatives, IMF-World Bankers and Commerce Secretaries who preached the art of the deal and the covenant of "greed is good." And the Reagan-eighties were "the decade of greed?" "Donnez-nous un break," say we both. So too, apparently, thinks Mr. Greenspan, as the Wall Street Journal Editorial Page observed yesterday in an Aside:

"Add Federal Reserve Chairman Alan Greenspan to the growing list of people who've about had it with the IMF's current course. Answering questions after he and Treasury Secretary Robert Rubin testified to the House Banking Committee yesterday, Mr. Greenspan said of the IMF that "a fundamental restructuring is urgently needed." He said we've reached the point where we need to either go ahead with what it's been doing (and he did not endorse that, unlike previous testimony), or we need to shut them down and "restructure" the IMF to reflect the huge changes in the world market system, meaning, as he said, start from square one." Sounds like it's time to get started."

© Copyright, Sept. 17, 1998, The Wall Street Journal

Washington now tells us there is a threat of countries slipping into depression; okay, let them. There is over-capacity in semiconductors as well as athletic shoes. But Asia's disease was primarily real estate and financial speculation, with the factories just grinding out "good stuff, cheap." The industrial-commercial basic economies of Asia remain in okay-to-good shape and it the wheeling-dealing yuppies who took the biggest hit. Let these countries adopt "the rule of law" and transparent business practices and accounting standards. Your warning signal that the Asians had lost their heads was in the skyscraper race of a few years ago when cities vied to erect a building taller than the last one, all seeking to exceed the height of the World Trade Center.

Tom and I continue in our confidence that now that Greenspan, rather than Mr. Rubin, is in charge, Mr. Greenspan will have things sorted out with reasonable dispatch. Though he apparently does not have an agreement with the G-7 for a concerted round of interest rate cuts, we patiently await the Sept. 29^th meeting of the Federal Open Market Committee. Thursday's market slide after a four-day rally to 8100 indicated to us that the 7400 floor for the Dow Industrials should hold, and support could be as high as 7600, depending on the melodrama in the world headlines. That the market survived today's "Triple Witching" morning trading flurry --stock options, index options and futures contracts all expire today and accounts must be settled-- further indicates a high confidence in Mr. Greenspan's leadership.

Just lining the names up should show you how risky an Irani invasion might be to all sides. I partly limned a nightmare scenario yesterday, leading to the dismantling of Pakistan; Iran's back is vulnerable if the Sunni Arab states join league with Pakistan.

Now the UN, once again, is trumpeting its role as the vital international peace-maker, but in fact, Pakistan got Ayatollah Khameini's message clearly and have dispatched their foreign minister to undertake direct negotiations in Tehran --indicating a pliable policy on Pakistan's part as "Mohammed will go to the mountain."

Pakistan minister flies to Iran to discuss Taleban By Tahir Ikram

ISLAMABAD, Sept 17 (Reuters) - Pakistani Foreign Minister Sartaj Aziz flew to Iran on Thursday to try to defuse growing regional tensions after the killing of Iranian diplomats in Afghanistan by the Taleban.

A Foreign Ministry spokesman said: ``We believe that there are risks and dangers inherent in an escalation, we believe urgent efforts should be made by all concerned to defuse this crisis.

``Most of all, we are interested in restoration of peace and stability here in the region. We believe that a possible conflict between the two countries will not be in the interest of anyone.''

© Reuters; 07:10 09-17-98

Further, Mme Albright has agreed to meet directly with Iran's foreign minister at the UN next week --the first open face-to-face since the Irani Revolution of 1978-79. There are other scurryings-around, as well.

Osama bin Laden is reported by Taliban to be on ice, and he is a big bargaining chip in this game. But in Africa, it appears that an Osama-follower tried to make a pass at the US Embassy in Kampala, Uganda. He apparently fled back to Kenya; his reported point-of-origin. Law enforcement officials admit the FBI just missed arresting another suspect in the Comoros Islands in late August --seems the alleged perpetrator got a last-minute tip and scooted for the hinterlands, despite the fact that the semi-remote Comoros are not easy to get in and out of.

Iran continues to build up forces along the border and if you study the terrain even casually, you see that the mountains and plains favor its forces. Iran is culturally cohesive and Pakistan is not. But the distances are great and the two sides not that imbalanced; a deal is a better idea. A reader sent the following appreciation (bracketed remarks are my editorial inclusions) for which I am grateful:

Actually, the western third and southern half of Afghanistan is an extension of the Khorasan plateau. It's not "mountainous and complex" like the east and northeast of Afghanistan, whence have come most of the pictures of fighting since the Russian intervention. Instead, it's mostly wide open spaces, like eastern Iran, rising to the central massif that, north of the Kabul River and its tributaries, becomes the Hindu Kush. It's wide open from Iran all the way to Kandahar. It's been over 150 years since Iran militarily asserted interests in Herat and western Afghanistan. Religious interests are otherwise. The Shia in Bamian, recently taken by the Taleban, are not just co-religionists with Iranians; they are "marja" Iranian (rebel ethnic Persian-Shiite groups backed by Tehran, particularly Hezbi-i-Wahdat, which controlled Bamian, the last town taken by Taliban on Sunday), and their networks go to Iran (despite official Irani denials in Thursday's wires). - Jon Anderson

Unrest continued in Tirana yesterday and a police station was attacked some thirty miles outside the capital as the northern Gegs stirred up by the KLA and by Sali Berisha, continued to try to exert pressure on the government so that they can continue their campaign to destabilize the Balkans to their advantage. Sorry, it isn't going to work as the West is rightfully concerned.

Today, Berisha led another march in Tirana, with about 3000 followers, but at the same time, Albania's parliament voted to remove his parliamentary immunity so that he may be arrested and tried for attempting a coup d'etat on Monday.

Mr. Clinton has signalled a three-leg policy approach that does offer equity to the Albanian majority of Kosovo and may approach their pre-1989 autonomy. Mr. Clinton also stressed the humanitarian relief problem and NATO strikes as a plausible stick --but we know this is really just posturing of a comic-opera saber-rattler, given events in Tirana.

In the melodramatic mind of our new NGO-UN humanitarian relief establishment, Kosovo represents a further opportunity to fortify their hold on policy and revenues, so they continue to exaggerate the magnitude of a situation that will merely be "uncomfortable" for secessionists this winter. Inflated estimates of 400,000 refugees favored by self-serving partisan advocates such as Bob Dole, has been reduced to a less-inflated level of 250,000, which is still probably high by 50-100,000 too high. Amid the number are 60,000 or more Serb refugees.

In the midst of this, today, I found a Reuters report that NATO is contemplating options including parachute airdrops of supplies to refugees in the forests of Metohija county, center of the collapsed insurrection. This seems more than a bit theatrical, if not outright melodramatic. The military-capable airfield at Pristina and a fleet of trucks will more than do the job. But Clinton does have a need for some showmanship so, perhaps we shall see parachutes. At any rate, foodstuffs will bombard Kosovo & Metohija, not Tomahawks.

Meanwhile there is a growing understanding that Slobodan Milosevic has to be maneuvered out of the way. Half of our Congress think he is a war criminal and that Serbia should be punished, a few are learning that the story is more complex than that.

Opposition politicians and Orthodox clerics from Metohija are in Washington, trying to develop understanding and support for reformist-republican political evolution in Yugoslavia. Mr. Milosevic has manipulated democracy to his purposes, but Yugoslavia's problem is that it is dying from an excess of democracy unfettered by the rule of law, checks & balances and the self-reliant spirit Serbs had in the generations before Tito's socialist fantasy robbed men of their motivation. "God helps those who help themselves."

© Copyright 1998 Benjamin C. Works-SIRIUS