Obama's Priorities: US Economy, Foreign Policy and Pakistan Relations

Following his first post-election press conference Friday that featured his distinguished panel of economic advisers, President-elect Barack H. Obama spoke with Pakistan's President Asif Ali Zardari, President Hosni Mubarak of Egypt, Prime Minister Silvio Berlusconi of Italy, President Lech Kaczynski and Prime Minister Donald Tusk of Poland, King Abdullah of Saudi Arabia and Prime Minister Jose Luis Rodriguez Zapatero of Spain.

Earlier on Thursday, the president-elect spoke to Australian Prime Minister Kevin Rudd, Canadian Prime Minister Stephen Harper, French President Nicolas Sarkozy, German Chancellor Angela Merkel, Israeli Prime Minister Ehud Olmert, Japanese Prime Minister Taro Aso, Mexican President Felipe Calderon, South Korean President Lee Myung-bak and British Prime Minister Gordon Brown.

In his Friday call to Asif Zardari that lasted over twenty minutes, Barack Obama assured Pakistani president that his administration would take Islamabad in confidence on all decisions regarding the war on terror, according to media reports.

Mr. Obama also said that he wants to establish better mutual relationship between the allies on the war on terror and settle differences in the aftermath of the US strikes in Pakistan.

Mr. Zardari is likely to meet Mr. Obama and Vice President-elect Joe Biden during his trip to the US next week to attend an inter-faith conference, a Pakistani official said in Islamabad.

"President-elect Obama's campaign slogan for 'change' has created a new set of global expectations about the US, which will be a major challenge for its new administration," said Pakistani minister Sherry Rehman.

Rehman added that vice president-elect Joe Biden is the architect of the Biden-Lugar legislation that commits development assistance of $15 billion for Pakistan over the next 10 years.

"This non-military aid signals a major shift in the focus of US assistance for Pakistan," the minister said, adding that this "reflects the newly elected US administration's support for our country's civilian democratic order, and an understanding of the necessity of building solid foundations for social and economic development of Pakistan".

During his first press conference as president-elect, Obama was asked about Iranian President Ahmadinejad's letter of congratulations addressed to him. Mr. Obama said Iran's pursuit of nuclear weapons was "unacceptable" and he would "respond appropriately" to the Iranian leader's letter. On Nov 3, there was a report of bipartisan plans for aggressive action against Iran in the beltway debate in New York Times. Carl Giacomo wrote in the beltway opinion column that "it is a frightening notion, but it is not just the trigger-happy Bush administration discussing — if only theoretically — the possibility of military action to stop Iran’s nuclear weapons program". Obama's mandate to negotiate with Iran in the face of the Israeli opposition is likely to be the tested soon. Given the past experience of other US presidents' inability to stand up to the growing power of the Israeli lobby in the US, I am not too sanguine that Obama will succeed. If Obama does succumb to the Jewish lobby's pressure, his entire agenda of fixing the ailing economy, defeating the Taleban and improving the US image in the world would be scuttled.

Early actions of the president-elect are seen as communicating his priorities to Americans and the world. His first appointment of Rahm Emanel as Chief of Staff, his first two sets of phone calls to world leaders on Thursday and Friday and his decision to meet with economic advisers and present them at his first news conference are all indications of the importance he attaches to each. However, Mr. Obama will still have to deal with the US Congress beholden to the various lobbyists who finance their campaigns. Let's hope he can succeed in his oft-repeated desire for "change" by reaching out to Americans directly via his open and transparent government initiative based on the use of online technology that helped him in his campaign. He will need to use all of his powerful communication skills and rhetorical gifts to maintain the support of the people and resist pressure from powerful lobbies and their congressional accomplices.

Here's the video clip of President-elect Obama's first press conference:

Jewish Power Grows in US Congress

While Barack Obama's choice of Rahm Emanuel, the Chicago-born son of Israeli Jews, as the White House Chief of Staff has made news in the United States, the bigger news of the growing Jewish strength in US Congress has not received much attention.

Jews make up only about 2% of the US population. However their representation in the US executive, legislatures, the Supreme Court is at least five times at about 10 percent plus. The exclusive club of Nobel laureates is dominated by its Jewish members, a testament to Jewish culture of hard work, commitment and achievement. Their numbers and power in the world of business, finance, media and entertainment, Washington think tanks, academia and top professions of accounting, law and medicine are even greater.

Jerusalem Post reports that the next session of Congress will include 45 Jewish lawmakers, a new record, after Democrats Alan Grayson of Florida and John Adler of New Jersey took two House seats from the Republican column.

Jared Polis, also a Democrat, was widely expected to win his Colorado House seat to match the previous record, set in the 2006 elections.

The House will have 32 Jewish members. Only the class of 1990 had more Jewish members - 34 - but there were fewer Jewish senators at the time.

The next Senate will have 13 Jewish members, the same as the previous session, despite a toss-up race in Minnesota, where both Republican incumbent Norm Coleman and his Democratic challenger, comedian Al Franken, are Jewish.

I admire the Jewish people for their culture of hard work and achievement. We should all emulate that. I also make a distinction between Israel lobby that pushed for Iraq war and the Jewish citizens in America, most of whom opposed the Iraq war. Vast majority of Jewish Congressmen and Senators are elected with AIPAC money and support, making them beholden to the Israel lobby.

I see this excessive power of Israel lobby or any other pressure group whether Muslim, Jewish, Christian, NRA or corporations as a threat to US democracy. The corrosive effect of money and influence peddling in politics is adversely affecting our executive, legislature, even judiciary. The powerful have gotten away with a lot lately, on both Wall Street and Main street. Iraq war was ignited by the neo-conservatives, most of whom were supported by the Likud-leaning Israel lobby, people such as Wolfowitz and other PNAC (Project for the New American Century) proponents. The Iraq war, described as the three-trillion dollar war by Nobel laureate economist Joe Stiglitz, has now radicalized the Muslim world, reduced US influence in the world, sunk the Republican party and almost bankrupted the US.

Obama's mandate to negotiate with Iran in the face of the Israeli opposition is likely to be the tested soon. Given the past experience of other US presidents' inability to stand up to the growing power of the Israeli supporters in the US, I am not too sanguine that Obama will succeed.

The recent election results, including Obama's historic win, will probably not change much as far the US Middle East policy is concerned. If anything, these results will likely make it extremely difficult for the US to act independently and play the role of an honest broker in any international issues involving Israeli interests. As the Iraq war has shown, the outcome of potentially aggressive and unilateral US foreign policy dictated by the Israel lobby will not be in the best interest of Israel, Arabs and the rest of the world. Those of us who care for Israel must understand this fact, if they share the goal of moving toward a more peaceful and prosperous world.

Here is a video clip of Obama addressing AIPAC, the powerful Israel lobby in US:



Related Links:

The Israel Lobby and US Foreign Policy

The Rise of Jewish Power-Nothing Short of Astounding

Jewish Tribal review

Jewish Domination of Mass Media

Obama's Technology Policy and Priorities

Technology will likely get significant attention by President-elect Barack H. Obama, in spite of the more urgent issues of two wars, a sputtering economy and ballooning US national debt. While there will be the usual rush by various special interest groups in the high tech world to try and influence US technology policy to favor their particular sectors or products, it is important for the new administration to see each technology in the broader context of national challenges such as government transparency, climate change, energy independence, delivering cost-effective healthcare broadly, improving education, encouraging innovation and overcoming major national economic challenges.

Obama understands the difference that online networking technology made in raising record amount of $700m for his campaign, and energizing the young people to get involved as campaign organizers, workers and voters. It can be expected that Obama will continue to promote and use the online media to reach out to the American people and inspire them to bring real change in America. Obama campaign has talked about appointing a Chief Technology Officer (CTO) to oversee US technology policy investments in the incoming Obama administration. The CTO’s mandate would be different from the Cybersecurity czar appointed under the Bush Administration. Bush’s czar helped defend against cyber threats. Obama’s CTO, by contrast, would ensure government officials hold open meetings, broadcast live webcasts of those meetings, and use blogging software, wikis and open comments to communicate policies with Americans, according to the plan. Such broad use of online media by the US government will benefit Silicon Valley high-tech businesses and encourage the use of technology by state and local governments in the US and other parts of the world. It'll also keep a lot of young people, who were energized by Obama, engaged in discussion and help solve major national issues. "Obama understood the intersection of demographics and technology and promised engagement and interaction," Don Tapscott, best-selling author and researcher, said in an interview recently. "But if he now says to young people, 'Thanks, now go passive for four years until my re-election,' there will be outrage. It will make the reaction of the 1960s generation look like kid stuff." The technology exists for Mr. Obama to improve government transparency and pursue the online relationships with his under-thirty supporters. However, Mr. Obama will have to make sure that people he surrounds himself with in the White House can take advantage of it.

Matt Marshall of Venture Beat has published details of Obama’s new technology policy and plans, which cover everything from providing new subsidies for internet broadband access to increased permanent visas for immigrants needed by the high-tech industry.

The president-elect has often talked about energy policy and dealing with its impact on climate change as a priority. He wants to create five million new jobs by strategically investing $150 billion over the next ten years to catalyze private efforts to build a clean energy future. Transformation in the way people and businesses use technology could reduce annual man-made global emissions by 15 per cent by 2020 and deliver energy efficiency savings to global businesses of over $ 800 billion, according to a new report published by independent non-profit The Climate Group and the Global e-Sustainability Initiative (GeSI). The choice of the CTO by Obama must reflect this priority. In addition to the CTO, the Obama administration should seriously consider appointing Nobel laureate Al Gore as a high-profile and high-powered ambassador to inspire and lead a global green revolution.

During his campaign, Obama has displayed protectionist tendencies in response to the middle class concerns for well-paying jobs being moved to countries such as India. In his speech to the Democratic National Convention, Obama pledged to halt tax sops to companies that ship jobs overseas. If Obama sticks to this promise, it will mean trouble ahead for India's IT industry. India's software and services exports stood at about $40 billion during the financial year 2008, a growth of 29%, with US as its largest market. Can Obama really curb outsourcing? It seems unlikely.

As the emerging economies in Brazil, Russia, India, China and the rest of the world try and emulate the US pattern of production and consumption, it is clear that this development model will not be sustainable for long. What is needed is a fundamental change in how we produce, market, distribute and consume various products and services. An accelerated change away from fossil fuels to renewable sources of energy is absolutely urgent. Such a fundamental change in architecture of our industrialized society will require a significant focus and commitment of human intellectual capital by the US.

Changing the economic incentives and transforming the industrial architecture will not be easy. The powerful lobbies of auto, steel, industrial equipment, farmers, financial services and information technology industries will likely resist any major changes that affect how they do business. Each of them will use their power and influence in Washington to get a larger share of funds in terms of tax credits or corporate welfare for themselves, at the expense of dealing with the larger national challenges. If Obama can inspire and lead such an effort to change how people produce, consume and live, the rewards are potentially very large in terms of creating millions of new jobs, enabling a healthier environment, persuading and supporting the emerging economies to limit carbon emissions, and saving the earth and the human race from total destruction.

Here is a Nov 2007 video clip of Obama's speech on technology at Googleplex in Mountain View, CA:



Here's another November 2007 video clip of Obama talking about technology, Pakistan, Middle East, Africa, war and peace and other matters:

Obama's Historic Win and Rahm Israel Emanuel

Barack Obama's victory is truly a historic moment for all Americans and a great example for the world at large. Mr. Obama's margin of victory was the largest since Lyndon Johnson's election as president in 1964. And if he runs the country as well as he ran his campaign, he does have a chance of becoming a very successful leader of the greatest nation on earth.

Obama's election represents a turning point for the people of color in the US. It is noteworthy that, in spite of their labeling of US as racist, the Europeans have yet to elect a person of color to the highest office in their lands.

A poll today asked both white and black American parents, "Can your child grow up to be president of the US?" Over 70% of blacks responded in the affirmative versus only 46% of whites.

Regarding McCain, I would say that he is a hero and a class act, even in his defeat. He was gracious and said, "This is an historic election. I recognize the special significance it has for African-Americans, for the special pride that must be theirs tonight.

"I've always believed that America offers opportunities to all who have the industry and will to seize it. Senator Obama believes that, too," McCain added.

"Senator Obama has achieved a great thing for himself and for his country, and I applaud him for it and offer him his sincere sympathy his beloved grandmother did not see him on this day," he said.

I believe Americans have very high expectations of their new president. They are looking for more than "change". I think they are looking for a "revolution". With two wars, a sputtering economy and ballooning national debt, it'll be tough for Obama to deliver on the promise of peace and prosperity any time soon. Obama will have to manage these expectations to succeed, after the initial euphoria is over. Though he has the goodwill of Americans and the world, his honeymoon period will not last long.

In terms of preparing to govern, I find that Obama's first appointment is not very encouraging.

President-elect Barack Obama on Wednesday offered the job of White House chief of staff to Democratic Congressman Rahm Emanuel, who reportedly accepted the offer. This is Obama's first and most important appointment.

The White House Chief of Staff is an extremely powerful position, setting the agenda and controlling access to the president.

Rahm Emanuel's appointment as White of House Chief of Staff has drawn widespread criticism from those who want real change. Emanuel, with close connections to AIPAC, was a leading supporter of Bush's Iraq invasion. In Congress, Emanuel has been a consistent and vocal pro-Israel hardliner, sometimes more so than President Bush. He has strongly reacted to the mildest of criticism of Israel. In June 2003, for example, he signed a letter criticizing Bush for being insufficiently supportive of Israel. "We were deeply dismayed to hear your criticism of Israel for fighting acts of terror," Emanuel, along with 33 other Democrats wrote to Bush. The letter said that Israel's policy of assassinating Palestinian political leaders "was clearly justified as an application of Israel's right to self-defense".

According to a report in Jerusalem Post, Emanuel is the Chicago-born son of Israelis. The 48-year-old Emanuel is a member of the Orthodox Jewish community of Chicago and grew up speaking Hebrew with his father, a pediatrician who was a member of Irgun, the Jewish resistance in Palestine that committed acts of terror and atrocities against the Palestinians to drive them out in 1948. During the Gulf War in 1991, Emanuel went to Israel to serve as a civilian volunteer. Emanuel holds dual citizenship of US and Israel.

Rahm Emanuel's father, Benjamin, yesterday refused to comment on the report that his son was appointed White House chief of staff. He told Haaretz that he would only comment after speaking to his son.

"Obama is a pro-Israeli leader and will be a friend to Israel," he said, adding that he was pleased with Obama's election. He also said his son is the namesake of Rahamim, a Lehi combatant who was killed. Lehi was described as a terrorist organization by the British authorities and United Nations mediator Ralph Bunche. The Israeli government banned the organization under an anti-terrorism law passed three days after Lehi assassinated UN mediator Folke Bernadotte. Lehi was also responsible for the assassination of Lord Moyne along with other attacks on the British authorities and Palestinian Arabs.


Obama will need all his skills and a set of close aides to prioritize and focus on a few key things, and not be distracted by the cacophony and chaos of his fellow Democrats in Congress from different wings of his party. He will be tested on both domestic and international fronts. There is a lesson for Obama from the early days of Clinton administration's first term that was marred by missteps leading to the defeat of Clinton's healthcare agenda and the loss of Democratic majority in Congress during his first term. Obama needs to avoid the temptation of trying to do too much too quickly in his first 100 days.

Here's are two video clips about "Who is Rahm Emanuel?"

NED Alumni Convention 2008 Draws 400 NEDians

NED Alumni Convention 2008 in Hartford, Connecticut attracted over 400 NEDians and their families and friends this year on Nov 1, 2008. This was the fourth successful North America annual convention of NED University alumni after Houston, New Jersey and Silicon Valley conventions. It consisted of a day-long conference with keynote speeches and panel discussions followed by a gala event in the evening with a banquet, fashion show, concert and stand-up comedy. New England NEDians led by Abul Islam and Aslam Siddiqui put on a very useful conference and a great show to try and mobilize NEDians to help their alma mater. The speeches highlighted the rich heritage of NEDUET, our alma mater, as the oldest institution of higher technical learning while the panel discussions centered around the state of science and technology education, NEDUET's controversial ranking by the HEC, and how to help make it better. The specific steps and actions to coordinate efforts between North American Alumni and NEDUET will hopefully be forthcoming after this convention, which was also attended by Dr. Shamsul Haq, the Pro VC, Dr. Farooq Rafiqi, the Dean of Civil Engg, and Dr. Sarosh Lodhi, the Chairman of Civil Engg Dept. at NED University.

NEDUET Alumni Convention 2009 is planned for July 18 in Anaheim, California, across from Disneyland. The planning sessions have already been kicked off by Southern California NEDians, the proud hosts of next year's convention.



Related Links:

NED University and Alumni Giving

NEDUET's Long History and Rich Heritage

NEDUET New England Alumni Association

PakAlumni- NED Alumni Social Network

NED Alumni Convention 2007

NEDUET and HEC Ranking Controversy

Obama Expected to Carry Pakistani-American Vote

Though polls on Pakistani-American voters are non-existent, all of the anecdotal evidence from various sources, including Pakistani-American periodicals' opinions, conversations at community events, news coverage, interactions on social networks such as Facebook, suggests that Barack Obama will sweep the Pakistani-American vote on coming Tue, Nov 4, 2008. While none of them like Obama's rhetoric on attacking inside Pakistan, most seem willing to give him a pass for other reasons unrelated to Obama's Pakistan stance. After eight disastrous years of Bush-Cheney administration which have seen perpetual war, shredding of the US constitution and the Bill of Rights, and the recent financial crisis, Pakistani-American voters are joining forces with the mainstream voters to punish all Republicans. Even John McCain, a moderate and maverick Republican, is being tarred and feathered as another George W. Bush or Dick Cheney. While John McCain did vote for the Iraq war (as did Hillary Clinton and Joe Biden), he has been very critical of the extreme Bush policies including Americans' surveillance, prisoner torture and the conduct of Iraq war.

At a recent Eid Reunion in San Francisco Bay Area organized by Pakistani-American Cultural Center, Charlotte Buchen of PBS Frontline World talked to a number of attendees about this Tuesday's election. Here is how Charlotte reported the conversation I had with her at the event:

"Pakistanis are extremely sensitive now about the U.S. role there," said Haq. "The situation seems to be escalating dangerously right now. We talk about Iraq War -- I think this situation could get far worse very quickly. And it could actually become a regional war."

A registered Democrat who has never voted for a Republican presidential candidate, Haq is voting for John McCain because of his concerns about U.S. policy in his fragile homeland.

"McCain is handling the situation in Pakistan gently. He understands not to make open statements, and he has been around for a long time," Haq said. "To me, Obama is a novice like GW was back in 2000. And it's still an imperial Presidency so Obama can make mistakes as Bush has."

Here's the link to Frontline's coverage of the PACC event, including a video.

The latest financial crisis has clearly added to the Republicans woes. Based on all of the polling data, it appears that a super majority of of 60 or more Democrats in the US senate and Democrat Barack Obama in the White House together will enjoy absolute concentration of power, unhindered by the fear of fillbuster or the veto pen of the president to stop misguided spending and legislation.

Can the US afford total control by Democrats at a time of huge national debt and large budget deficits? The history tells us that Social Security and Medicare, the two massive entitlement programs, were created during Democratic administrations of FDR and LBJ. Now, more than half of the $3 trillion budget is allocated to these programs. Another $250b pays for interest on the national debt, but it is growing rapidly with the debt. The rest covers everything else. The discretionary spending accounts for less than one-third of total US spending. Such figures limit any reasonable options open to the incoming administration. However, given the absolute control over both the executive and the legislature, will Democrats exercise restraint? Given their past record, the chances are that Democrats will go for big spending programs, including new, popular entitlements such as a massive national healthcare program for all. Cutting discretionary spending will not free up enough dollars for it. Ending Iraq war or cutting military budget will not do it either, particularly if Obama makes the expensive mistake of following through on his hawkish statements to send troops in to Pakistan. Of necessity, Democrats are going to have to dramatically increase taxes or heavily borrow from foreigners. Either of these two options will hinder economic recovery.

Democrats, like Republicans before them, will likely abuse their power in the executive and the legislature to enrich themselves and their friends at the expense of ordinary Americans. After having given George W. Bush almost a blank check for most of the last eight years, Americans appear ready to make an even bigger mistake: Give Democrats total control of the U.S. government for the next several years.

Will Absolute Power Corrupt Democrats Absolutely?

Latest polls indicate Democrats are maintaining significant leads in the big ten battleground states such as Florida and Ohio, in addition to Michigan and Pennsylvania. While it is understandable after eight disastrous years of Bush-Cheney administration, it is ironic that John McCain, a moderate and maverick Republican, is being tarred and feathered as another Bush. The latest financial crisis has clearly added to the Republicans woes. Based on all of the polling data, it appears that a super majority of of 60 or more Democrats in the US senate and Democrat Barack Obama in the White House together will enjoy absolute concentration of power, unhindered by the fear of fillbuster or the veto pen of the president to stop misguided spending and legislation.

Can the US afford total control by Democrats at a time of huge national debt and large budget deficits? The history tells us that Social Security and Medicare, the two massive entitlement programs, were created during Democratic administrations of FDR and LBJ. Now, more than half of the $3 trillion budget is allocated to these programs. Another $250b pays for interest on the national debt, but it is growing rapidly with the debt. The rest covers everything else. The discretionary spending accounts for less than one-third of total US spending. Such figures limit any reasonable options open to the incoming administration. However, given the absolute control over both the executive and the legislature, will Democrats exercise restraint? Given their past record, the chances are that Democrats will go for big spending programs, including new, popular entitlements such as a massive national healthcare program for all. Cutting discretionary spending will not free up enough dollars for it. Ending Iraq war or cutting military budget will not do it either, particularly if Obama makes the expensive mistake of following through on his hawkish statements to send troops in to Pakistan. Of necessity, Democrats are going to have to dramatically increase taxes or heavily borrow from foreigners. Either of these two options will hinder economic recovery.

Democrats, like Republicans before them, will likely abuse their power in the executive and the legislature to enrich themselves and their friends at the expense of ordinary Americans. After having given George W. Bush almost a blank check for most of the last eight years, Americans appear ready to make an even bigger mistake: Give Democrats total control of the U.S. government for the next several years.

Democrats Must Share Blame for Worst Financial Crisis

The Bush administration has been the target of attacks by Democrats for the international financial crisis that began on Wall street earlier this year. The critics' main argument is that the Bush-era anti-regulation environment allowed unregulated derivatives contracts, called "weapons of mass destruction" by Warren Buffett, to grow into a mushroom cloud.

While it is true that the dramatic growth of derivative contracts such as credit default swaps happened on Republicans' watch, the fact is that the seeds of the current crisis were sown during Clinton years. It all began with an obscure but critical piece of federal legislation called the Commodity Futures Modernization Act of 2000. And the bill was a big favorite of the financial industry it would eventually help destroy.

It not only removed derivatives and credit default swaps from the purview of federal oversight (on page 262 of the legislation), Congress prohibited the state and local governments from enforcing existing gambling and bucket shop laws against Wall Street.

As the recent CBS 60 Minutes segment explained, "In retrospect, giving Wall Street immunity from state gambling laws and legalizing activity that had been banned for most of the 20th century should have given lawmakers pause, but on the last day and the last vote of the lame duck 106th Congress, Wall Street got what it wanted when the Senate passed the bill unanimously." Though CNN has only picked Senator Phil Gramm as one its top 10 Culprits of Collapse, the entire senate is responsible for it.

Clearly, the unanimous Senate passage of the Commodity Futures Modernization Act of 2000 demonstrated the power of Wall Street over both Republicans and Democrats. In fact, the data of the financial services industry's recent campaign contributions shows that two of the top three recipients of the largess from Wall street are Democrats Barack Obama and Hilary Clinton. John McCain is in a distant third position. Overall, Sen Obama's campaign is awash with record, massive cash contributions.

Since the current financial crisis has its roots in easy, plentiful mortgages and the housing bubble facilitated by the Democrats' unabashed and reckless support for home ownership via Fannie and Freddie and community re-investment legislation, a larger share of the blame for the current crisis should be assigned to the Congressional Democrats such as Barny Frank and Chris Dodd.

Aziz Leads IMF Criticism as Crisis Grows

The International Monetary Fund has come under severe criticism as the financial crisis that started on Wall Street is spreading to the developing world. IMF is the most important multi-lateral financial institution. It is responsible for overseeing the global financial system and the economic policies of its 185 members. The IMF is supposed to act as an early warning system for markets and economies. The institution is also charged with diagnosing economic problems and proactively regulating and stabilizing the international financial system to prevent and manage the kind of financial crisis the world is facing now.

Pakistan's former Prime Minister Shaukat Aziz, credited with reviving Pakistan's economy, is taking the IMF to task for being absent, or at least tardy. Mr. Aziz accused the International Monetary Fund last week of failing to show leadership during what he described as a "historic" global financial crisis.

As world leaders met to shore up distressed financial institutions, Mr Aziz charged that "this global institution which is supposed to look at everything going on was not even in the room where meetings are going on."

Speaking at an international business conference in Manila, the former Wall Street banker said interest rate cuts, recapitalization of banks and liquidity injections, while helpful, would not be sufficient to solve the problem.

"The very fabric of the global financial system is under threat," Aziz said, according to AFP.

Mr Aziz suggested there was a need to boost the IMF's regulatory powers and create a more powerful body.

"The world is becoming increasingly specialized," he said, adding that existing systemic threats beyond the agency's traditional monetary policy role must be addressed. "A robust regulatory regime must touch all the stakeholders," he said, with reference to the credit rating agencies that have come in for criticism amid the crisis.

Mr. Aziz was pointing out the fact that the banks and capital are now global. Most major financial institutions operate in multiple countries on different continents, and it is hard to draw national boundaries on regulation. In such an environment, international regulatory regime and international action to correct problems are required.

In its defense, it can be said that the IMF is not alone in being taken by surprise by the depth of the crisis, said Mr. Michael Mussa, IMF's former Chief Economist. Even Alan Greenspan, the former US Federal Reserve Chairman, has expressed shock and disbelief at the extent and the speech at which the crisis has grown.

The Bank for International Settlements, which groups the world's central banks, and the Paris-based Organization for Economic Cooperation and Development did not fully realize the gravity of the situation either.

"The explosion of the crisis, particularly in the past few weeks, is something that was not anticipated by anyone in official circles," Mr Mussa says, according to a BBC report.

As the unprecedented credit crunch hits even the countries with a good record of managing their economies, the IMF is considering urgent measures and reforms to rapidly respond to the developing crisis. According to the Associated Press, among the ideas under discussion is to provide a credit line in hard currency to countries that otherwise would have no access to foreign capital.

The IMF's 24-member executive board is expected to meet next week to examine the various proposals under consideration.

The immediate beneficiaries would be developing nations with good economic track records such as Turkey, Brazil and South Korea that normally have no difficulty borrowing but have seen access to money dry up as Western banks simply stopped lending.

Another idea under consideration is to let member countries borrow against the amount they have contributed to the fund, known as a quota. For example, if South Korea borrowed against its quota, it could obtain almost $22 billion.

The IMF already is discussing loan packages with close to a dozen countries and is examining ways to speed up the process in line with instructions it received this month from its policymaking committee.

IMF loans often serve as an incentive to other lenders, generating other financing from private and public sources such as the multilateral development banks.

The loans also come with stringent conditions that involve budget cutting and other belt-tightening measures that some governments have said should be eased in the current crisis. Many developing nations and NGOs have criticized the IMF for its insistence on cuts that hurt the poor the most. IMF supporters counter that the developing nations require close IMF supervision because they have not been good stewards of their economies.

A case in point is Pakistan. It has just returned to ask for IMF's help after a break of several years when its economy was considered one of the fastest growing in the world. But times are different now. The country's economy is in freefall. Inflation is running at about 30%. The rupee has devalued by about 25% in just three months. The fiscal deficit is a whopping 10% of GDP. Foreign-exchange reserves cover just six weeks of imports. A $500m Eurobond matures next February, but the market has already decided it is junk. The country needs at least $3 billion immediately, and a further $10 billion over the next two years to plug a balance-of-payments gap. Without it, default abroad might well coincide with political anarchy at home.

In the first loan made in the current global economic turmoil, Iceland and the IMF tentatively agreed to a $2 billion loan over two years in response to the collapse of the country's banking system.

The government said the deal, which still must be approved by the IMF's board in Washington, also will give Iceland immediate access to $830 million to head off the financial threat to its entire economy.

The IMF has helped several troubled developing economies earlier this decade. IMF was also very active during the Asian financial crisis of 1997-98. In the current financial crisis, Iceland became the first Western country to borrow from the IMF since Britain in 1976.

Other countries thought to be close to reaching a loan agreement with the IMF include Hungary, Ukraine and Pakistan, even though Pakistani government publicly denies it.

The head of the IMF, Dominique Strauss-Kahn, said this month that the fund has more than $200 billion available for bail out and could obtain additional resources quickly if needed. The consensus among the experts is that IMF will need a lot more than $200 billion as the list of countries lining up for IMF help grows longer by the day, including non-traditional borrowers such as Iceland.

Are Jews Culprits of Collapse on Wall Street?

The high-profile role played by Jews on Wall Street has never been a secret. Many of the wheelers and dealers responsible for shaping the current US financial system are Jewish, including former AIG CEO Hank Greenberg, former Citigroup CEO Sandy Weill, recently-retired Lehman Bros. CEO Richard Fuld, former Fed chairman Alan Greenspan, former Treasury Secretary Bob Rubin, current Fed chairman Ben Bernanke,etc. One of the "weapons of mass destruction" described by the legendary investor Warren Buffet is the Credit Default Swap. Greenberg's AIG is the biggest purveyor of CDS. In spite of the warnings by Buffet in 2006, Greenspan and his successor Bernanke argued against regulating derivatives such as credit default swaps. Unregulated financial derivatives are now considered the biggest cause of the financial collapse.

Credit derivatives is one of the most successful innovations of financial engineering over the last ten years. The current active credit derivatives market has produced an array of new products. For example, credit-default swaps are an indicator of the cost of bond "insurance" that varies with the risk of bond default. Credit default swaps are privately traded derivative contracts usually bought by bond holders from CDS issuers like AIG, Ambac, FGIC, and MBIA and other entities. Like other derivatives, CDS are not regulated by government agencies. The CDS issuers are expected (not gauranteed or back-stopped by governments) to reimburse bondholders in case the bond issuing companies or governments default. A basis point on a credit-default swap contract protecting $10 million of debt from default for five years is equivalent to $1,000 a year. The buyers of CDS do not have to be bondholders. Any one can buy a CDS to bet on the probability of default by debt issuers. Once issued, the credit default swaps are bought and sold like any other contract. Many of these derivative contracts were bought to bet that the housing bubble would pop and many homeowners would default on their mortgages. That is exactly what happened this year. These derivative contracts have produced enormous profits for Wall Street firms in the last decade. But now the Fortune magazine calls these derivatives "a $55 tillion problem".

The world of finance is not unique in the dominant role played by Jews. Other businesses including media and entertainment and professions such as medicine, law and accounting have powerful Jewish presence. American Jews are disproportionately over-represented in the US Congress, the Senate and the Supreme Court as well. US policies in all spheres are heavily influenced by the Jewish minority in the United States. The exclusive club of Nobel laureates is dominated by its Jewish members, a testament to Jewish culture of hard work, commitment and achievement. Many significant levers of power are controlled by American Jews, a constant that does not change with election winners or losers in Washington, where AIPAC is the most powerful lobby. Both Obama and McCain teams boast of powerful Jews as key policy advisers on foreign affairs, finance and national security. Robert Rubin and Dennis Ross are advising Obama. Joe Lieberman is advising McCain.

When former President Pervez Musharraf of Pakistan addressed a dinner meeting of the American Jewish Congress in September 2005, his Jewish audience were described as the American business, political and social elite.

When things go wrong in any of the major US businesses or institutions, people looking for scapegoats often blame influential Jews because of the large Jewish presence in each of them. The current financial crisis is no exception.

Abraham Foxman, President of Anti-Defamation League, has written in Jerusalem Post about the recent "anti-semitic" response to the financial crisis. He writes, "It never fails. Whenever there is a financial crisis or trading scandal in the stock markets, the anti-Semites come out of the woodwork. The classic stereotype of the Jewish Shylock out to have his Christian pound of flesh dies very hard, if at all. The Jew as economic opportunist sucking the financial life-blood out of a nation or of the whole world is continually reborn".

Mr. Foxman does have a point. Stereotypes, whether Jewish or Muslim, are hard to change. The reality is that there are only three Jews on the CNN's latest top ten list of the culprits of collapse even if one argues that these three are the most important of the top ten. They are: Former Fed Chairman Alan Greenspan, Current Fed Chairman Ben Bernanke and the Lehman Brothers CEO Richard Fuld. As some of us blame the few who made serious mistakes and happen to be Jewish, let us not forget that a large number of Jewish workers and investors on Wall Street are victims of the financial meltdown. Many Jews have lost their jobs while others are suffering major declines in their investment portfolios.

Related Links:

Jewish Lobby Blamed for Economic Crisis

Financial Crisis Brings Out Anti-Semites

Jews on Wall Street

The Israel Lobby and US Foreign Policy

The Rise of Jewish Power-Nothing Short of Astounding

Jewish Tribal review

Wall Street's WMDs

Credit Default Swaps

$55 Trillion Problem

Jewish Domination of Mass Media