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US Slashes UN Budget By $285 Million Following Jerusalem Rebuke

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(Via Zerohedge)

The United States announced a $285 million cut in the United Nations’ “bloated” budget for next year, negotiated by UN Ambassador Nikki Haley. A statement by the United States Mission to the United Nations reads:

Today, the United Nations agreed on a budget for the 2018-2019 fiscal year. ‎Among a host of other successes, the United States negotiated a reduction of over $285 million off the 2016-2017 final budget. In addition to these significant cost savings, we reduced the UN’s bloated management and support functions, bolstered support for key U.S. priorities throughout the world, and instilled more discipline and accountability throughout the UN system.

Pleased with the cuts, Haley added “you can be sure we’ll continue to look at ways to increase the UN’s efficiency while protecting our interests.”

The move follows a contentious week at the U.N., after 128 nations voted in a “stunning rebuke” of President Trump’s decision to recognize Jerusalem as the capital of Israel. Prior to the vote, Trump threatened to cut foreign financial aid to any countries who opposed the move – first with a tweet by Ambassador Nikki Haley threatening that the US would be “taking names,” followed by comments made by Trump to reporters last Tuesday, according to Reuters.

U.S. President Donald Trump on Wednesday threatened to cut off financial aid to countries that vote in favor of a draft United Nations resolution against his decision to recognize Jerusalem as Israel’s capital.

“They take hundreds of millions of dollars and even billions of dollars, and then they vote against us. Well, we’re watching those votes. Let them vote against us. We’ll save a lot. We don’t care,” Trump told reporters at the White House.

Haley also circulated a letter to all UN member states effectively warning them not to vote against Trump’s decision. “As you consider your vote, I want you to know that the President and U.S. take this vote personally,” she wrote. “The President will be watching this vote carefully and has requested I report back on those countries who voted against us.”

As we now know, this accomplished absolutely nothing:

As we wrote last week, The outcome of the vote was hailed as a “victory” by Palestine. “We will continue our efforts in the United Nations and at all international forums to put an end to this occupation and to establish our Palestinian state with east Jerusalem as its capital,” Abbas’ spokesman Nabil Abu Rudainah said. Predictably, both Israel and the US were displeased.

The General Assembly vote came days after the U.S. vetoed a similar resolution in the U.N. Security Council. The panel’s other 14 members voted in favor of that measure – a move that Haley called an “insult” to the U.S. Shortly after the Security Council vote, Arab and Muslim leaders at U.N. called for an emergency special session of the General Assembly to discuss the U.S.’s Jerusalem decision.

In a defiant speech ahead of the General Assembly vote on Thursday, Riyad Al Maliki, the Palestinian foreign affairs minister, cast the Trump administration’s Jerusalem decision as an affront on regional peace and security that has isolated the U.S. from the international community. “Does the United States not wonder why it stands isolated in this position?” he asked.

Turkey, which has led the Muslim opposition to the US Jerusalem declaration, was among the first to speak at the meeting. Turkish Foreign Minister Mevlut Cavusoglu stressed that only a two-state solution and sticking to the 1967 borders can be a foundation for a lasting peace between Israel and Palestine. The minister said that since Jerusalem is the cradle for the “three monotheistic religions,” all of humanity should come together to preserve the status quo.

“The recent decision of a UN member state to recognize Jerusalem as the capital of Israel violates the international law, including all relevant UN resolutions. This decision is an outrageous assault on all universal values,” Cavusoglu said.

The United States contributes approximately 22 percent of the U.N. budget – or around $3.3 billion, which President Trump asked the State Department to cut by over 50% in March.

U.S. officials in Washington and New York learned during the past week that they will be asked to find ways to cut spending on obligatory and voluntary U.N. programs by 50 to 60 percent from the International Organization Affairs Bureau’s account. State Department officials, for instance, were told that they should try to identify up to $1 billion in cuts in the U.N. peacekeeping budget, according to one source. The United States provides about $2.5 billion per year to fund peacekeepers. -Foreign Policy

U.S. diplomats warned key U.N. members during a March 9 meeting in New York to “expect a big financial restraint” on American spending – which is not surprising following President Trump’s comments from last December:

Ambassador Haley was clear in her comments after the budget cut, telling the press “We will no longer let the generosity of the American people be taken advantage of or remain unchecked,” adding “This historic reduction in spending – in addition to many other moves toward a more efficient and accountable UN – is a big step in the right direction.

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Economy

China Pressuring Wall Street To Stop Trump On Trade War

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(Via Zerohedge)

If anyone still doubted President Trump’s determination to slap tariffs on all – or even more than all – Chinese goods flowing into the US, they probably don’t anymore. So far this week, the president has taken to twitter to trash his own Treasury Secretary’s efforts to restart talks with the Chinese, before Trump publicly declared on Friday that he intends to move ahead with plans to slap 25% tariffs on another $200 billion worth of goods.

Given the president’s unflinching resolve in pursuing his trade agenda, it’s understandable why a shrewd businessmen would go to great lengths to avoid getting in the middle of what looks to be a protracted geopolitical dogfight.

But unfortunately for top Wall Street firms, many of which harbor ambitions of expanding their business in China, that may no longer be an option. Because while the Trump administration has largely left them alone, the Chinese are now trying to use whatever leverage they can (i.e. preferential access to the world’s second-largest economy) to push America’s top bankers to intervene on Beijing’s behalf.

Reuters reported Friday that top Chinese officials have hastily organized an investment conference in Beijing and requested the presence of several top Wall Street firms. The conference will be chaired by former PBOC Governor Zhou Xiaochuan and ex-Goldman Sachs President John Thornton, and feature an appearance by Chinese vice-president Wang Qishan. Dubbed “the firefighter” by the Chinese people, Quishan, in addition to being the most powerful of China’s vice presidents, is also one of the senior Communist officials involved in managing the trade dispute.

While market liberalization is certainly a priority for the Chinese, it’s difficult to imagine that these top officials are planning to attend this conference – especially with so much else going on – just to brainstorm ideas about how China can proceed with opening up its financial sector.

The subtext here is obvious: China wants to figure out who in the US financial services community can help them get through to Trump and help stop this conflict before losses in China’s currency and stock market spiral out of control. And if the carrot of access doesn’t work, China has already proven adept at leveraging the stick.

(Full Article Here)

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Politics

Jeff Bezos Thinks President Trump’s “Attacks” Are “Dangerous”

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(Via Zerohedge)

A day after unveiling his first major charitable initiative (an announcement that arrived, coincidentally, we’re sure, after a bruising week of headlines detailing the latest crop of worker-abuse allegations directed at Amazon), Amazon CEO Jeff Bezos (also the world’s wealthiest man) disappointed hundreds of powerful people who had convened to hear him speak – as rumors swirled that he might reveal the location of Amazon’s much-hyped HQ2 – last night at the Economic Club of Washington DC. But instead of an outright reveal, Bezos assured his audience that Amazon plans to announce the location by the end of the year, though he wouldn’t elaborate beyond that.

According to CNBC, Bezos, who was interviewed by private equity titan David Rubenstein, assured his audience that Amazon’s team is “working hard” on evaluating the finalists (the company announced 20 finalists earlier this year).

“The answer is very simple…We will answer the decision before the end of the year,” Bezos said. “We will get there.” Bezos swiftly changed the subject to his recently launched “Day One” charitable fund, which he recently seeded with $2 billion of his personal fortune.

As is his nature, Bezos shared his intentions to expand the “Day One” fund as his team learns more about the “business” of philanthropy.

“I believe in the power of wandering,” Bezos said. “All of my best decisions in business and life have been made with heart, intuition, guts — not analysis.”

He later said he would like to invest “a lot of money” in an enterprise that most rational investors would view as a “really bad investment”, a statement that turned into a plug for his Blue Origin space exploration company.

(Full Article Here)

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Politics

Bailing Out The Rich Only Makes It Worse

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(Via Zerohedge)

In 1948, the architect of the post-war American suburb, William Levitt, explained the point of the housing finance system. “No man who owns his own house and lot can be a Communist,” he said. “He has too much to do.”

It’s worth reflecting on this quote on the ten-year anniversary of the financial crisis, because it speaks to how the architects of the bailouts shaped our culture. Tim Geithner, Ben Bernanke, and Hank Paulson, the three key men in charge, basically argue that the bailouts they executed between 2007 and 2009 were unfair, but necessary to preserve stability. It’s time to ask, though: just what stability did they preserve?

These three men paint the financial crisis largely as a technical one. But let’s not get lost in the fancy terms they use, like “normalization of credit flows,” in discussing what happened and why. The excessively wonky tone is intentional – it’s intended to hide the politics of what happened. So let’s look at what the bailouts actually were, in normal human language.

The official response to the financial crisis ended a 75-year-old American policy of pursuing broad homeownership as a social goal. Since at least Franklin Delano Roosevelt, American leaders had deliberately organized the financial system to put more people in their own homes. In 2011, the Obama administration changed this policy, pushing renting over owning. The CEO of Bank of America, Brian Moynihan, echoed this view shortly thereafter. There are many reasons for the change, and not all of them were bad. But what’s important to understand is that the financial crisis was a full-scale assault on the longstanding social contract linking Americans with the financial system through their house.

The way Geithner orchestrated this was through a two-tiered series of policy choices. During the crisis, everyone needed money from the government, but Geithner offered money to the big guy, and not the little guy.

First, he found mechanisms, all of them very technical—and well-reported in Adam Tooze’s new book Crashed—to throw unlimited amounts of credit at institutions controlled by financial executives in the United States and Europe. (Eric Holder, meanwhile, also de facto granted legal amnesty to executives for possible securities fraud associated with the crisis.)

Second, Geithner chose to deny money and credit to the middle class in the midst of a foreclosure crisis. The Obama administration supported this by neutering laws against illegal foreclosures.

The response to the financial crisis was about reorganizing property rights. If you were close to power, you enjoyed unlimited rights and no responsibilities, and if you were far from power, you got screwed. This shaped the world into what it is today. As Levitt pointed out, when people have no stake in the system, they get radical.

Did this prevent a full-scale collapse? Yes. Was it necessary to do it the way we did? Not at all.

(Full Article Here)

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