Saturday, June 18, 2011

Join us for a march for jobs and human rights and in support of antiwar resolutions at the Conference of Mayors/Afghanistan broke

Fund Our Communities calls for an immediate end to the wars in Iraq and Afghanistan and an abolition of nuclear weapons by 2020, and the savings redirected to urgent needs at home, with a special focus on job creation. A resolution passed by the Baltimore City Council on Monday, May 16 and signed by Mayor Stephanie-Rawlings-Blake asks Congress to redirect war spending to domestic needs. The rate of war spending of nearly $240,000 every minute could pay for all salary and benefits for three Maryland public school teachers for an entire year.


There will be a march and rally for jobs on Sat., June 18.  Citizens will gather at St. Vincent de Paul Church (120 N. Front St. 21202) at 11:30 AM and march to the Hilton Hotel at the Inner Harbor (401 West Pratt Street 21201), the site of the U.S. Conference of Mayors. The march is co-sponsored by Full Employment Baltimore, a coalition comprised of a variety of community organizations and social movements calling for policy changes to create more and better jobs for the people of Baltimore. Call Max at 410-366-1637.

Afghanistan Facing Insolvency Within a Month, say Officials

by Jon Boone

The Afghan government will struggle to pay its bills "within a month" after the International Monetary Fund rejected proposals for resolving the Kabul Bank scandal, western officials have warned.

Afghanistan is facing a deepening financial crisis after the IMF rejected proposals to resolve the Kabul Bank scandal. (Photograph: Shah Marai/AFP/Getty Images) Although the war-torn country's biggest bank nearly collapsed last September, the government of Hamid Karzai and the international community are still at loggerheads over plans to fund an $820m (£507m) bailout as well as how the disgraced former managers and shareholders who helped themselves to hundreds of millions of dollars should be prosecuted.

As long as the IMF declares the plans to be inadequate, many countries, including Britain, are legally barred from pumping money into a government that is almost completely reliant on foreign cash to pay civil servants' salaries.

It was reported by Reuters that the IMF has now formally rejected the Afghan government's proposals, meaning aid disbursements will remain on hold. The failure to reach a deal by a deadline of last Saturday also meant a $70m payment from the World Bank's Afghan reconstruction trust fund was automatically withheld.

Two senior western officials said the government will face a cash crisis in the coming weeks and could struggle to pay staff bills, although one predicted this would be avoided by cutting other spending priorities.

Last month, Omar Zakhilwal, the country's finance minister, told the Guardian that suspension of aid payments "has already had an effect on us, no doubt about it". He insisted that the Afghan government had done "95% of what was asked of us" by the IMF, including effectively nationalising Kabul Bank, stripping the shareholders of their rights and putting all unrecovered loans into receivership.

But although he claimed the remaining issues "were inconsequential to Kabul Bank" the IMF sees two aspects as vitally important. Firstly, an agreement that Afghan taxes, not foreign aid, will repay the $820m taken out of central bank reserves last year to prop up the bank. Second, they want serious criminal investigations against managers and shareholders, many of whom enjoy high level political support, who illegally borrowed huge sums of interest-free cash from the bank.

Although the finance ministry has drawn up plans to increase its tax-raising efforts in order to pay off the bailout in annual instalments, horrified MPs have already rejected one budget request for $73m and is also likely to reject a supplemental budget due to be presented by Zakhilwal soon.

"The IMF tells me, this is our demand, give me condition by this date the parliament must approve this line in the budget," explained Zakhilwal. "I am a minister, can I chose the parliament timeline? On these issues the international community totally disregards the legal processes of Afghanistan."

Many MPs argue that the money should be found by simply selling off the assets illegally bought by shareholders and managers, including a gas distribution company, an airline and luxury villas in Dubai.

Although a $10m forensic audit by Kroll may help identify many deliberately hidden assets, most western experts doubt more than half of the outstanding $910m will be recovered. So far just $61m has been retrieved.

Zakhilwal also argued that prosecutions could only be handled by the attorney general and warned that the complicated inquiry cannot be rushed.

"The attorney general can arrest people, but after 15 days with not case they have to be acquitted – that would be even more embarrassing for us," Zakhilwal said.

Although the finance minister insisted the attorney general was "absolutely committed" to a thorough investigation, the international community is sceptical, not least after Afghanistan's top law officer threw out a case last year against one of Karzai's key aides who had been wire-tapped soliciting a bribe.

One alternative plan is for a special court of handpicked judges deemed to be reasonably honest and well-versed in finance to hear the case.

Credible prosecutions are vital, not just to appease public anger, but also because many of Kabul Bank's assets are in Dubai. Under United Arab Emirates law it is impossible to seize properties until criminal investigations have begun.

Not only does Afghanistan face a cash crunch, the showdown with the IMF also threatens to derail plans, pushed hard by Hamid Karzai, for a far greater proportion of international aid to be spent through official channels, rather than on projects outside the control of the government.

A key element of the "transition" strategy by which the foreign intervention in Afghanistan will be greatly reduced by the end of 2014, the international community last year agreed that 50% of spending will go through the government by 2012.

But it is now feared that if the Afghan government continues to be considered unworthy of international investment by the IMF the country will have to return to patchwork of bilateral funding agreements.

More reporting here.

© 2011 Guardian News and Media Limited

8 Comments so far

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Posted by B3nign

Jun 17 2011 - 4:54pm

The occupied have truely learnt from the culture of the occupiers
Wall Street still did it better, because non of those banksters have been arrested.

Posted by WTF

Jun 17 2011 - 7:13pm

US taxpayers to the rescue!

But who will rescue the US taxpayer?

Posted by gardenernorcal

Jun 17 2011 - 8:00pm

US taxpayers the ordinary workers are already tapped out. Let the Afghans sell secondhand t shirts like Zambia. The IMF created that economy I am sure it's what they seek to do in Ireland and Greece too. It's good for big global business and the banks. Not so great for the citizens.

Posted by Obedient Servant

Jun 17 2011 - 7:54pm

Assuming this article is factual and accurate, not to worry.

Afghanistan will get its bailout.

It's too big to fail.

Posted by dreamjoehill

Jun 17 2011 - 11:22pm

The Afghani economy must be hurting, what with the low price of smack these days.

It's cut into Company funds & bank profits, as well.

Posted by Fred54

Jun 18 2011 - 12:15am

You beat me to this by that much!! LMAO

Posted by TrouserAttack

Jun 18 2011 - 5:35am

Looks like the West have taken easily to thinking of Afghanistan as a troubled subsidiary of their corporate empire. Peace? Who cares as long as they can return to profitability?

Well who'd have thunk it? Maybe thieving their stuff and dropping bombs on people doesn't do them as much good as we thought. So much for dynamic motivation...

Posted by mschlee

Jun 18 2011 - 7:16am

Maybe the US could extend credits so the Afghans can build their own heroin production facilities and tax synthetic opiates to make them less competitive.




Donations can be sent to the Baltimore Nonviolence Center, 325 E. 25th St., Baltimore, MD 21218.  Ph: 410-366-1637; Email: mobuszewski [at]


"The master class has always declared the wars; the subject class has always fought the battles. The master class has had all to gain and nothing to lose, while the subject class has had nothing to gain and everything to lose--especially their lives." Eugene Victor Debs


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