HSBC Bank: Secret Origins To Laundering The World's Drug Money

Source: blacklistednews.com

SOURCE: ZERO HEDGE

SOURCE: GREAT GAME INDIA

HSBC Bank : Secret Origins To 26/11 Mumbai Attacks

#SwissLeaks what the media has termed it is a trove of secret documents from HSBC’s Swiss private banking arm that reveals names of account holders and their balances for the year 2006-07. They come from over 200 countries, the total balance over $100 billion. But nowhere has the HSBC Swiss list touched off a more raging political debate than in India.

That’s why to obtain and investigate the Indian names, The Indian Express partnered in a three-month-long global project with the Washington-based International Consortium of Investigative Journalists (ICIJ) and the Paris-based Le Monde newspaper. The investigation revealed 1,195 Indian HSBC clients, roughly double the 628 names that French authorities gave to the Government in 2011. The new revelation— published as part of a global agreement — is expected to significantly widen the scale and scope of the ongoing probe by the Special Investigation Team (SIT) appointed by the Supreme Court.

For years, when banks have been caught laundering drug money, they have claimed that they did not know, that they were but victims of sneaky drug dealers and a few corrupt employees. Nothing could be further from the truth. The truth is that a considerable portion of the global banking system is explicitly dedicated to handling the enormous volume of cash produced daily by dope traffickers.

Contrary to popular opinion, it is not “demand” from the world’s population which creates the mind destroying drug trade. Rather, it is the world financial oligarchy, looking for massive profits and the destruction of the minds of the population it is determined to dominate, which organized the drug trade. The case of HSBC underscores that point. Serving as the central bank of this global apparatus, is HSBC.

2009 CIA Map of Drug Trade Routes

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East India Company Origins

The opium trade began in the early 1700s as an official monopoly of the British East India Company, which conquered India, and ran it on behalf of the British Crown and the financiers operating through the City of London. Indian-grown opium became a key component in the trade for tea and silk in China.  The East India Company had a thriving business selling British textiles and other manufactured products in India, and selling Chinese silk and tea in Britain. But the Company ran into problems with the opium end of the trade. The influx of opium caused major problems for China, and led the Emperor to issue an edict in 1729 prohibiting opium consumption. Then, in 1757, the Emperor restricted all foreigners and foreign vessels to a trading area in the port city of Canton. A stronger edict in 1799 prohibited the importation and use of opium under penalty of death.

None of this stopped the British from continuing to flood China with opium, creating millions of addicts, but it did cause the East India Company to protect its tea and silk trade by shifting its Chinese opium operations to nominally independent drug runners who bought opium legally from the East India Company in Calcutta, and smuggled it into China. The most prominent of these drug-running firms was Jardine Matheson & Co. It was founded in 1832 by two Scotsmen, William Jardine and James Matheson.  Jardine had been a ship’s surgeon with the East India Company, while Matheson was the son of a Scottish baronet. The firm today is controlled by the Keswick family. In 1839, the Chinese Emperor launched an anti-opium offensive, which included the confiscation of all opium stocks in the hands of Chinese and foreign merchants. The merchants put up a fight, but were ultimately forced to concede, turning in their opium stocks after being indemnified against losses by British officials.

In response, however, the British launched a propaganda campaign against China, accusing it of violating Britain’s right to “free trade.” Britain sent its fleet to China, to force the Chinese to capitulate to the opium trade. The action, known as the First Opium War, resulted in the Treaty of Nanking in 1842, under which China not only capitulated to the opium trade, but also agreed to pay reparations to the opium runners and gave the British control of the island of Hong Kong. However, the treaty did not specifically legalize opium, so the British launched a second Opium War, which resulted in the 1856 Treaty of Tientsin, which legitimized the opium trade and opened China up to foreigners even more.

As the opium and other trade with China expanded, Britain’s new territory of Hong Kong became a major imperial commercial center. The opium dealers gathered together to form a bank, the Hongkong and Shanghai Bank, as the financial flagship of the British opium trade. Over time, the bank—now known as HSBC—would extend its reach into the drug fields of the Middle East and Ibero-America, as befitting its role as the financial kingpin of Dope, Inc.

Role of Secret Societies

In 1783 Lord Shelbourne launched the Chinese opium trade with Scottish merchants from the East India Company and members of the House of Windsor-allied Knights of St. John Jerusalem.

Shelbourne’s chief propagandist was Adam Smith who worked for East India Company, which emerged from the slave-trading Levant Company and later became known as Chatham House, home to the powerful Royal Institute for International Affairs (RIIA). In 1776 the high seas pirate Adam Smith wroteWealth of Nations, which became the bible of international capitalism.

In the Far East the British organized the Chinese Triad Society, also known as the Society of Heaven and Earth, to smuggle their opium.  Beginning in 1788 the Freemason Grand Lodge of England established lodges in China, one of which was the Triad Society.  Another was known as the Order of the Swastika.

In 1839 William Jardine- a Canton-based opium trafficker- steered Britain into the first Opium War after Chinese officials confiscated his stash. The second Opium War lasted from 1858-1860.  Lord Palmerston commanded both expeditions for the Brits.  He was also the High Priest of Scottish Rite Freemasonry in the British Empire.

Throughout the 19th century the British families of Matheson, Keswick, Swire, Dent, Inchcape, Baring and Rothschild controlled the Chinese heroin traffic.  The Inchcape’s and Baring’s Peninsular & Orient Steam Navigation Company (PONC) transported the dope around the world.

To the US West Coast, the families brought Chinese coolies to build JP Morgan’s railroads, slave laborers who were kidnapped (shanghaied) by the Triads.  The Triads came along too, setting up opium dens in San Francisco and Vancouver and using a network of Chinatowns as a channel for heroin.  This network exists today.  To the US East Coast the families brought African slaves and cotton.  These same families built plantations and became kings of southern cotton on the backs of shanghaied Africans.

The American families Perkins, Astor and Forbes made millions off the opium trade.  The Perkins’ founded Bank of Boston, which is today known as Credit Suisse First Boston.  The Perkins and Morgan families endowed Harvard University.  William Hathaway Forbes was a director at Hong Kong Shanghai Bank shortly after it was founded in 1866.  John Murray Forbes was the US agent for the Barings banking family, which financed most of the early drug trade.  The Forbes family heirs later launched Forbes magazine. Steve Forbes ran for President in 1996.  John Jacob Astor invested his opium proceeds in Manhattan real estate and worked for British intelligence.  The Astor family home in London sits opposite Chatham House.

These families launched the Hong Kong Shanghai Bank Corporation (HSBC) after the second Opium War as a repository for their opium proceeds.  HSBC, a subsidiary of the London-based HSBC Holdings, today prints 75% of Hong Kong’s currency, while the British Cecil Rhodes-founded Standard Chartered Bank prints the rest.  HSBC’s Hong Kong headquarters sits next to a massive Masonic Temple.

Freemasonry is a highly secretive society, making it an ideal vehicle for global drugs and arms trafficking.  According to 33rd Degree Mason Manly Hall, “Freemasonry is a fraternity within a fraternity – an outer organization concealing an inner brotherhood of the elect…the one visible and the other invisible.  The visible society is a splendid camaraderie of ‘free and accepted’ men enjoined to devote themselves to ethical, educational, fraternal, patriotic and humanitarian concerns.  The invisible society is a secret and most august fraternity whose members are dedicated to the service of an arcanum arcandrum (sacred secret).”

Wealth derived from selling this Chinese opium during British colonial rule, helped build many landmarks on India’s west coast. The Mahim Causeway, The Sir JJ School of Art, David Sassoon Library and Flora Fountain, landmarks in modern Mumbai, were built by prominent Parsi and Jewish traders from profits made by a flourishing opium and later cotton trade with China.

Prominent families from Mumbai’s past, names that adorn today’s famous institutions such as the Wadia’s, Tata’s, Jejeebhoy’s, Readymoney’s, Cama’s and Sassoon’s sold opium to China through the British. By the end of the nineteenth century, when the opium trade went bust, cotton from India’s western state of Gujarat, which had already developed strong trade links with Canton profited. The Paris’s ploughed profits from the trade with the Chinese back into India, setting up several schools, hospitals and banks. Historical records prove that some of India’s prominent Parsi traders at the time, were founders of the Hong Kong and Shanghai Banking Corporation (HSBC) founded in 1865. For a detailed report read Rothschild colonization of India.

It is this deadly opium empire that Gandhiji was very much conscious about and spoke out against for which he was jailed in 1921 by India’s British rulers for “undermining the revenue”. Having seen generations of Chinese youths rendered docile and passive Gandhijis was concerned over opium and its deadly effects on India which is clear from his letters. These opium production activities ran until 1924 in India and were stopped with the heroic efforts of Mahatma Gandhi who first agitated to remove opium production from India and destruction of China using Indian soil. Finally the British transferred the entire production to Afghanistan in 1924 handing the production to southern Afghani tribals which after 90 years became the golden crescent of opium production. Though the production is in the hands of Afghan tribals the distribution finance market control is still exercised by the same old British business houses or their proxies.

Afghan Opium for Bankers and Terrorists

There is a general impression that Afghanistan has always been the center of opium production. In fact, it has not. Prior to the Soviet invasion in 1979, opium production in Afghanistan was less than 1,000 tons; that grew to 8,200 tons (based on conservative UN Office on Drugs and Crime/UNODC figures) in 2008. Throughout this period, Afghanistan was in a state of war. Following the Soviet invasion, the anti-Soviet powers, particularly, the US, UK, and Saudi Arabia, began generating larger amounts of drug money to finance much of the war to defeat the Soviets. Since 1989, after the Soviet withdrawal, there has been an all-out civil war in Afghanistan, as the US-UK-Saudi-created mujahideen dipped further into the opium/heroin money.

What was happening in Afghanistan during this period that caused opium production to soar to those levels? History shows that the US invasion in 2001 came close to wiping out the Taliban forces; the Afghan people, at least at that point in time, because of the Pakistani-Saudi links to the Taliban and the oppressive nature of the Wahhabi-indoctrinated regime, supported the invading American and NATO forces. That began to change in 2005.

The year 2005 is important in this context, since one of the most damning parts of the US Senate report details HSBC’s relationship with the Saudi-based Al Rajhi Bank, a member of Osama bin Laden’s “Golden Chain” of important al-Qaeda financiers. The HSBC-Al Rajhi relationship has spanned decades; perhaps that is why, even when HSBC’s own internal compliance offices asked that it be terminated in 2005, and even when the US government discovered hard evidence of Al Rajhi’s relationship with terrorism, HSBC continued to do business with the bank until 2010.

In fact, the report said, Al Rajhi’s links to terrorism were confirmed in 2002, when US agents searched the offices of a Saudi non-profit US-designated terrorist organization, Benevolence International Foundation. In that raid, agents uncovered a CD-ROM listing the names of financiers in bin Laden’s Golden Chain. One of those names was Sulaiman bin Abdul Aziz Al Rajhi, a founder of Al Rajhi bank.

Recently an operation by German Customs official revealed that the British Queen financed Osama Bin Laden. German officials in an operation raided two containers passing through Hamburg Port and seized 14,000 documents establishing that Osama bin Laden was funded by UK Queen’s bank Coutts, which is part of the Royal Bank of Scotland.

HSBC & 26/11 Mumbai Attacks

Why did HSBC not terminate its links with the Al Rajhi in 2005? The answer lies in what was then put in place in Afghanistan to generate large amounts of cash. When it comes to opium/ heroin and offshore banks, Britain rules supreme. In 2005, poppy fields in southern Afghanistan began to bloom, and it became evident to the bankers and the geo-politicians of Britain and the US that cash to support the financial centers and the terrorists could be made right there.

It was announced on Jan. 27, 2006 in the British Parliament that a NATO International Security Assistance Force (ISAF) would be replacing the US troops in Helmand province as part of Operation Herrick. The British 16 Air Assault Brigade would make up the core of the force. British bases were then located in the districts of Sangin, Lashkar Gah, and Gereshk.

As of Summer 2006, Helmand was one of the provinces involved in Operation Mountain Thrust, a combined NATO/Afghan mission targeted at Taliban fighters in the south of the country. In July 2006, the offensive essentially stalled in Helmand, as NATO (primarily British) and Afghan troops were forced to take increasingly defensive positions under heavy insurgent pressure. In response, British troop levels in the province were increased, and new encampments were established in Sangin and Gereshk. In Autumn 2006, some 8,000 British troops began to reach “cessation of hostilities” agreements with local Taliban forces around the district centers where they had been stationed earlier in the Summer, and it is then that drug-money laundering began in earnest.

This drug money, at least a good part of it, is generated in this area with the help of Dawood Ibrahim, who also played a role in helping the Mumbai attackers by giving them the use of his existing network in Mumbai. At the time, Ibrahim worked on behalf of the British, and ran his operation through the British-controlled emirate of Dubai. Drugs came into Dubai through Dawood’s “mules,” protected by the Pakistani ISI and British MI6; the dope was shipped in containers which carried equipment sent there for “repair” from Kandahar and elsewhere in southern Afghanistan. British troops controlled Helmand province, where 53% of Afghanistan’s gargantuan 8,200 tons of opium was produced in 2007.

The drugs were converted, and still are today, to cash in Dubai, where Dawood maintains a palatial mansion, similar to the one he maintains in Karachi. Dubai is a tax-free island-city, and a major offshore banking center. The most common reason for opening an offshore bank account is the flexibility that comes with it.

With the development of the Dubai International Financial Centre (DIFC), which is the latest free-trade zone to be set up there, flexible and unrestricted offshore banking has become big business. Many of the world’s largest banks already have significant presence in Dubai – big names such as Abbey National Offshore, HSBC Offshore, ABN Amro, ANZ Grindlays, Banque Paribas, Banque de Caire, Barclays, Dresdner, and Merrill Lynch, all have offices in the Emirate already.

In addition to Dubai, most of the offshore banks are located in former British colonies, and all of them are involved in money laundering. In other words, the legitimization of cash generated from drug sales and other smuggled illegitimate goods into the “respectable banks” is the modus operandi of these offshore banks. The drugs that Dawood’s mules carry are providing a necessary service for the global financial system, as well as for the terrorists who are killing innocents all over the world.

In December of 2007, this Britain-run drug-money-laundering and terrorist-networking operation was about to be exposed when Afghan President Hamid Karzai learned that two British MI6 agents were working under the cover of the United Nations and the European Union behind his back, to finance and negotiate with the Taliban. He expelled them from Afghanistan. One of them, a Briton, Michael Semple, was the acting head of the EU mission in Afghanistan and is widely known as a close confidant of Britain’s Ambassador, Sir Sherard Cowper-Coles. Semple now masquerades as an academic analyst of Afghanistan, and was associated with the Harvard Kennedy School’s Carr Center. The second man, an Irishman, Mervin Patterson, was the third-ranking UN official in Afghanistan at the time that he was summarily expelled.

These MI6 agents were entrusted by London with the task of using Britain’s 7,700 troops in the opium-infested, Pushtun-dominated, southern province of Helmand to train 2,000 Afghan militants, ostensibly to “infiltrate” the enemy and “seek intelligence” about the lethal arms of the real Taliban. Karzai rightly saw it as Britain’s efforts to develop a lethal group within Afghanistan, a new crop of terrorists.

The drug money thus generated to fund the financial centers and terrorists through HSBC was also responsible for ongoing terrorist attacks that have destabilized most of South Asia. The most important of these was the massive attack on Mumbai.

The mode used to launder such drug money is through diamonds. A 2003 Report assessed various alternative financing mechanisms that could be used to facilitate money laundering and or terrorist financing. Trading in commodities, remittance systems, and currency were assessed on each of their abilities to earn, be moved, and store value. Diamonds were the only alternative financial device that fit into all of these assessment criteria.

Diamonds can be vulnerable for misuse for money laundering and terrorist financing purposes because they can transfer value and ownership quickly, often, with a minimal audit trail. They provide flexibility and an easy transportation of value.

Top diamond traders of the country, several of whom are now settled abroad, figure on what the media calls as the #SwissList, with mostly Mumbai addresses given. Many persons on the list are Gujarati diamond merchants with offices all over world having roots in Palanpur.

However their involvement in not just limited to money laundering. Almost 6 months before 26/11 2008 Mumbai Attacks the Financial Intelligence Unit of India (FIU-IND) (the central national agency responsible for receiving, processing, analyzing and disseminating information relating to suspect financial transactions) was already tracking the diamond industry for suspicious activities by terrorists.

“A year ago, some people from Mumbai began purchasing diamonds worth crores of rupees. When the industry tried to trace the traders, they turned out to be non-existent,” said Vanani.

The FIU traced all foreign transactions of Surat’s diamond industry, especially those emanating from Belgium. It found that a great deal of money was being invested by terrorist groups.

However in May 2014 eight of these Belgium based diamond dealers were given a clean chit by the Income Tax department in the black money case. The I-T department said a probe was initiated against the eight individuals, but there was no proof of tax evasion by them. Why is the Government reluctant in disclosing Black Money related data; be it NDA and even UPA before it ? For a detailed report on the issue read 26/11 – The Black Money Trail.

From the Far East to the Middle East to Ibero-America to India, everywhere the drug trade is flourishing, you will find HSBC. It may not handle the dope, but it does handle the money, making sure that the “citizens above suspicion” who run the empire get their cut of the proceeds.  Now HSBC has been caught red-handed laundering money in the U.S., India, China, Argentina almost everywhere the sun shined through the colonies. This is a bank which has abused us, assaulted our people, and violated the law with abandon. Isn’t it time we set an example and revoke its charter to do business here in India ?

Putin's Russia is Not the Utopia Some Bloggers Paint it

Source: blacklistednews

Intel Turns Off Russian Forums, Blogs & Comments In Response To Russian Blogging Law

SOURCE: TECH DIRT

Back in April of last year, we were among the first to report on a very dangerous new law in Russia targeting bloggers, requiring any blogger or social media user with more than 3,000 "visitors" a day to register their real name with the government. The idea, obviously, is to put a massive chill on free speech among popular bloggers and social media users -- making it clear that the government is tracking everything they do. Just recently we noted how various social media platforms were responding to Russian demands that they censor or take down accounts related to opposition politician Alexei Navalny, or other critics of the government. 

But the blogger/social media law has now gone into effect, and it's having an impact in all sorts of places. For example, chip giant Intel has now announced that it is basically turning off all ways to contribute to its Russian Intel Developer Zone in order to comply with the law.

In order to be compliant with the Russian Internet Bloggers Law the following changes will be implemented in the Russian Intel® Developer Zone community as of January 1st 2015:

• Blog post contributions will be disabled
• Forum contributions will be disabled
• All commenting will be turned off for Russian content

While it's unlikely that those in power in Russia today think this is a very big deal, recognize that taking Russians out of forums and discussions concerning key technological developments could certainly come back to haunt Russian technology development. This also comes about a month after Google closed down its Russian engineering office, in response to a different regulatory shift: a "data handling law" that would require all information from Russian users be kept in Russia (making it more easily accessible by Russian officials and the intelligence community). 

All of these moves may be designed to shore up the existing leadership's political power, but it seems like a fairly short-term strategy, given that the end result is likely to hold back technological expertise and talent at a time when staying on top of technology is so important.

American Food Supply Listed as Reason for EU to Dump U.S. and Join Russia

Source: blacklistednews

 HEATHER CALLAGHAN, NATURAL BLAZE

It appears that the EU is both vulnerable and sought after - economically and geopolitically.

Russia is making no bones about an open proposal to the EU. Essentially, dump the U.S. - don't join the Transatlantic Trade and Investment Partnership (TTIP), but join the Eurasian Economic Union, which went into effect January 1st. It's a call to join other members at the "cool table" - a promise of a better trading table.

Western sanctions led Russia to ban food imports from the West. Russia has consistently rejected GMOs and went even further to tighten GMO sanctions. Is it any wonder why they have a valid card to use sway with the EU? Meanwhile, the EU can ostensibly continue keeping its patrons happy with consumer freedom regarding GMOs (yet is has been heavily tempted to give that power right back to GE corporate interests). If the EU chooses America, then that means the import of GE foods. They are straddling some fences.

Russia has multiple ploys to "close the deal" with the E.U. One is to show them their bleak economic outlook. But another, no less, is to point to the bleak American food supply, even the non-GMO parts.

A free trade report in yesterday's Deutsche Wirtschafts Nachrichten (reported by Zero Hedge) states:

Russia has presented a startling proposal to overcome the tensions with the EU: The EU should renounce the free trade agreement with the United States TTIP and enter into a partnership with the newly established Eurasian Economic Union instead. A free trade zone with the neighbors would make more sense than a deal with the US.

The Russian Ambassador to the EU, Vladimir Chizhov, said to the EU Observer :

Do you think it is really wise to put so much political energy into a free trade zone with the United States, while much more natural partner had at his side, in the immediate neighborhood? We do not treat our chickens in any case with chlorine. [emphasis added]

Furthermore, Germany's Minister of Agriculture, Christian Schmidt, didn't make an EU/American trade deal sound appealing when he said, "we can't protect every sausage." GMOs were a part of that conversation, too; and, lo and behold, during negotiations U.S. officials considered for the first time - GMO labeling! This shows that the U.S. government will not pay heed to its own consumers' desire for transparency and safety, but will if there is geopolitical benefit.

Unfortunately, other countries have ample reasons to be leery of entering or staying in trade deals with the U.S. Aside from food contamination scares (both GMO and non-GMO), the U.S. has burned some countries with unreasonable demands that protect corporate interests while threatening that country's residents. Guatemala discovered a hidden agenda that read like the Monsanto Protection Act. Brazil didn't want to act as a personal fine enforcer and medium for both the U.S. and Monsanto. China has had to reject major shipments of unapproved genetically engineered corn.

When it comes to activism and trying to focus passionately on one issue at a time, sometimes there is a temporary knowledge gap. For instance, trying to grasp the entire geopolitical and global economic picture of this current development is beyond the scope of this article.

However, when it comes to swift moves across the geopolitical chessboard, a nation's food supply has never been a separate issue. To fill in some gaps, it might help to read books by F. William Engdahl, because his book on GMOs and the food supply actually fits another puzzle piece with his other works on oil, money and geopolitics.

A tainted and toppling food supply isn't helping the United States - or even tempting the rest of the world at this point.

Down the Memory Hole: Facebook Plays Gatekeeper and Filters Things You Aren't Supposed to See

Source: blacklistednews

For the wretched souls addicted to Facebook, you are their economic engine. They mine your data, run facial recognition software on your pictures and you tell them about everything about yourself, and everything about everyone you know. Governments are salivating at the idea of learning more about you and Facebook offers you up on a silver platter. They have been censoring information in the past but now they are mulling the idea of a 'dislike button. It won't be hard to find some good minders who will disappear information that your Government doesn't approve of.

MASHABLE MAKES IT PLAIN “FACEBOOK CENSORSHIP HAS INCREASED 19% IN THE PAST 6 MONTHS”:

Now more than ever, governments around the world are eager to get their hands on data about Facebook users — and now more than ever, they want to remove content disappear from the social network.

Global surveillance requests for Facebook user data in the first half of 2014 increased 24% from the second half of 2013, according to the social network's transparency report revealed on Tuesday. A total of 34,946 requests were made between January and June, including messages, IP addresses and account information. Censorship also increased worldwide; compared to the June through December 2013, the amount of content censored on Facebook increased by 19%, according to the report.

THE BBC SAYS, “FACEBOOK THINKING ABOUT 'DISLIKE' FUNCTION – ZUCKERBERG”:

Facebook is thinking about adding a way to "dislike" posts on its site, founder Mark Zuckerberg has said.

Speaking at a Q&A session in California, he said it was one of the most requested features the social network receives from its users.

He said the site would need to find a way to make sure it did not become a way to demean people's posts.

According to Facebook's own figures, 4.5 billion "likes" are generated every day.

"One of things we've thought about for quite a while is what's the right way to make it so that people can easily express a broader range of emotions," Mark Zuckerberg told an audience at Facebook's headquarters.

It wouldn't be so bad if each individual user themselves wants to see certain things and avoid other things as Facebook spams you with tons of useless crap but its another if some third-party is deciding for everyone what we see and don't. Users for a long time have been complaining that when they post on certain topics their posts are not seen by others. Facebook is far from being aboveboard when it comes to censorship and users can't dislike ads or privacy infringement. If you are not paying for the service then you are the product. You have no say in how Facebook does their business. Your first amendment rights are now privileges that can and will be taken away.

Pepe Escobar, Eurasian integration vs. The empire of chaos

Source: blacklistednews

SOURCE: TOM DISPATCH

We were kids, but they weren’t kidding.  It wasn’t called “Risk: The Game of Global Domination” for nothing. You remember it, I’m sure. You had a territory. You had armies. You could make alliances. You could cheat, stab in the back, and generally scheme to your heart’s content as long as you achieved your goal: the conquest of the world.  And it’s never ended, not for Parker Brothers, nor for the great powers of this planet over the last many centuries.  Look at a Risk board these days and note that whoever controls Europe starts off with Ukraine, while whoever has Asia (with China at its heart) has Russia as well.  Pepe Escobar would find meaning in that line-up. TomDispatch’s peripatetic Eurasian correspondent, he’s the man who discovered Pipelinestan, which, by the way, would have made a thrilling kids’ game filled with skullduggery and historic profits in the service of devastating the planet until the price of oil recently began plunging toward the energy subbasement.  As he points out today, the world is starting to look ever more eerily like a giant game of Risk, especially across the Eurasian subcontinent.

For a bare decade or so after the Soviet Union imploded, it seemed like the game of global domination, the one for the big kids in Washington (and, until 1990, Moscow), had come to its ultimate conclusion with a single victor till the end of time.  (So the Bush administration came to believe anyway.)  Jump another decade-plus ahead and Risk once again has a more contested look to it.  As Escobar so brilliantly labels it -- the title, by the way, of his newest book that includes his superb Pipelineistan work for TomDispatch -- the U.S. has come to seem ever more like an “empire of chaos” rather than the dominating power on planet Earth.  Wherever its military has gone these last 13 years, what’s followed has been some version of chaos, destabilization, radicalization (often, but not always, in a fundamentalist direction), and blowback (as well as torture, drones, black sites, the death of innocents, the uprooting of populations, and the manufacture of jihadist organizations). It’s a picture that couldn’t be uglier.

In the meantime, on the Eurasian continent, something seems to be shifting, potentially in a big way, and Escobar is, as ever, on the scene.  Consider today’s essay part two (here’s part 1) of his wide-ranging look at a potentially tectonic set of commercial and power shifts, centering on China, that could change the way the world works (or, of course, simply descend into Cold War 2.0). Tom

Go West, Young Han 
As Washington “Pivots” to Asia, China Does the Eurasian Pirouette 
By Pepe Escobar

November 18, 2014: it’s a day that should live forever in history. On that day, in the city of Yiwu in China’s Zhejiang province, 300 kilometers south of Shanghai, the first train carrying 82 containers of export goods weighing more than 1,000 tons left a massive warehouse complex heading for Madrid. It arrived on December 9th.

Welcome to the new trans-Eurasia choo-choo train.  At over 13,000 kilometers, it will regularly traverse the longest freight train route in the world, 40% farther than the legendary Trans-Siberian Railway. Its cargo will cross China from East to West, then Kazakhstan, Russia, Belarus, Poland, Germany, France, and finally Spain.

You may not have the faintest idea where Yiwu is, but businessmen plying their trades across Eurasia, especially from the Arab world, are already hooked on the city “where amazing happens!” We're talking about the largest wholesale center for small-sized consumer goods -- from clothes to toys -- possibly anywhere on Earth.

The Yiwu-Madrid route across Eurasia represents the beginning of a set of game-changing developments. It will be an efficient logistics channel of incredible length. It will represent geopolitics with a human touch, knitting together small traders and huge markets across a vast landmass. It’s already a graphic example of Eurasian integration on the go. And most of all, it’s the first building block on China’s “New Silk Road,” conceivably the project of the new century and undoubtedly the greatest trade story in the world for the next decade.

Go west, young Han. One day, if everything happens according to plan (and according to the dreams of China’s leaders), all this will be yours -- via high-speed rail, no less.  The trip from China to Europe will be a two-day affair, not the 21 days of the present moment. In fact, as that freight train left Yiwu, the D8602 bullet train was leaving Urumqi in Xinjiang Province, heading for Hami in China’s far west. That’s the first high-speed railway built in Xinjiang, and more like it will be coming soon across China at what is likely to prove dizzying speed.

Today, 90% of the global container trade still travels by ocean, and that’s what Beijing plans to change.  Its embryonic, still relatively slow New Silk Road represents its first breakthrough in what is bound to be an overland trans-continental container trade revolution.

And with it will go a basket of future “win-win” deals, including lower transportation costs, the expansion of Chinese construction companies ever further into the Central Asian “Stans,” as well as in Europe, an easier and faster way to move uranium and rare metals from Central Asia elsewhere, and the opening of myriad new markets harboring hundreds of millions of people.

So if Washington is intent on “pivoting to Asia,” China has its own plan in mind.  Think of it as a pirouette to Europe across Eurasia.

Defecting to the East?

The speed with which all of this is happening is staggering. Chinese President Xi Jinping launched the New Silk Road Economic Belt in Astana, Kazakhstan, in September 2013. One month later, while in Indonesia’s capital, Jakarta, he announced a twenty-first-century Maritime Silk Road. Beijing defines the overall concept behind its planning as “one road and one belt,” when what it’s actually thinking about is a boggling maze of prospective roads, rail lines, sea lanes, and belts.

We’re talking about a national strategy that aims to draw on the historical aura of the ancient Silk Road, which bridged and connected civilizations, east and west, while creating the basis for a vast set of interlocked pan-Eurasian economic cooperation zones.  Already the Chinese leadership has green-lighted a $40 billion infrastructure fund, overseen by the China Development Bank, to build roads, high-speed rail lines, and energy pipelines in assorted Chinese provinces. The fund will sooner or later expand to cover projects in South Asia, Southeast Asia, the Middle East, and parts of Europe. But Central Asia is the key immediate target.

Chinese companies will be investing in, and bidding for contracts in, dozens of countries along those planned silk roads. After three decades of development, while sucking up foreign investment at breakneck speed, China’s strategy is now to let its own capital flow to its neighbors. It’s already clinched $30 billion in contracts with Kazakhstan and $15 billion with Uzbekistan. It has provided Turkmenistan with $8 billion in loans and a billion more has gone to Tajikistan.

In 2013, relations with Kyrgyzstan were upgraded to what the Chinese term “strategic level.” China is already the largest trading partner for all of them except Uzbekistan and, though the former Central Asian socialist republics of the Soviet Union are still tied to Russia’s network of energy pipelines, China is at work there, too, creating its own version of Pipelineistan, including a new gas pipeline to Turkmenistan, with more to come.

The competition among Chinese provinces for much of this business and the infrastructure that goes with it will be fierce. Xinjiang is already being reconfigured by Beijing as a key hub in its new Eurasian network. In early November 2014, Guangdong -- the “factory of the world” -- hosted the first international expo for the country’s Maritime Silk Road and representatives of no less than 42 countries attended the party.

President Xi himself is now enthusiastically selling his home province, Shaanxi, which once harbored the start of the historic Silk Road in Xian, as a twenty-first-century transportation hub. He’s made his New Silk Road pitch for it to, among others, Tajikistan, the Maldives, Sri Lanka, India, and Afghanistan.

Just like the historic Silk Road, the new one has to be thought of in the plural.  Imagine it as a future branching maze of roads, rail lines, and pipelines. A key stretch is going to run through Central Asia, Iran, and Turkey, with Istanbul as a crossroads site. Iran and Central Asia are already actively promoting their own connections to it. Another key stretch will follow the Trans-Siberian Railway with Moscow as a key node. Once that trans-Siberian high-speed rail remix is completed, travel time between Beijing and Moscow will plunge from the current six and a half days to only 33 hours. In the end, Rotterdam, Duisburg, and Berlin could all be nodes on this future “highway” and German business execs are enthusiastic about the prospect.

The Maritime Silk Road will start in Guangdong province en route to the Malacca Strait, the Indian Ocean, the Horn of Africa, the Red Sea and the Mediterranean, ending essentially in Venice, which would be poetic justice indeed.  Think of it as Marco Polo in reverse.

All of this is slated to be completed by 2025, providing China with the kind of future “soft power” that it now sorely lacks. When President Xi hails the push to “break the connectivity bottleneck” across Asia, he’s also promising Chinese credit to a wide range of countries.

Now, mix the Silk Road strategy with heightened cooperation among the BRICS countries (Brazil, Russia, India, China, and South Africa), with accelerated cooperation among the members of the Shanghai Cooperation Organization (SCO), with a more influential Chinese role over the 120-member Non-Aligned Movement (NAM) -- no wonder there's the perception across the Global South that, while the U.S. remains embroiled in its endless wars, the world is defecting to the East.

New Banks and New Dreams

The recent Asia-Pacific Economic Cooperation (APEC) summit in Beijing was certainly a Chinese success story, but the bigger APEC story went virtually unreported in the United States.  Twenty-two Asian countries approved the creation of an Asian Infrastructure Investment Bank (AIIB) only one year after Xi initially proposed it. This is to be yet another bank, like the BRICS Development Bank, that will help finance projects in energy, telecommunications, and transportation.  Its initial capital will be $50 billion and China and India will be its main shareholders.

Consider its establishment a Sino-Indian response to the Asian Development Bank (ADB), founded in 1966 under the aegis of the World Bank and considered by most of the world as a stalking horse for the Washington consensus. When China and India insist that the new bank’s loans will be made on the basis of “justice, equity, and transparency,” they mean that to be in stark contrast to the ADB (which remains a US-Japan affair with those two countries contributing 31% of its capital and holding 25% of its voting power) -- and a sign of a coming new order in Asia.  In addition, at a purely practical level, the ADB won’t finance the real needs of the Asian infrastructure push that the Chinese leadership is dreaming about, which is why the AIIB is going to come in so handy.

Keep in mind that China is already the top trading partner for India, Pakistan, and Bangladesh.  It’s in second place when it comes to Sri Lanka and Nepal.  It’s number one again when it comes to virtually all the members of the Association of Southeast Asian Nations (ASEAN), despite China’s recent well-publicized conflicts over who controls waters rich in energy deposits in the region. We’re talking here about the compelling dream of a convergence of 600 million people in Southeast Asia, 1.3 billion in China, and 1.5 billion on the Indian subcontinent.

Only three APEC members -- apart from the U.S. -- did not vote to approve the new bank: Japan, South Korea, and Australia, all under immense pressure from the Obama administration. (Indonesia signed on a few days late.) And Australia is finding it increasingly difficult to resist the lure of what, these days, is being called “yuan diplomacy.”

In fact, whatever the overwhelming majority of Asian nations may think about China’s self-described “peaceful rise,” most are already shying away from or turning their backs on a Washington-and-NATO-dominated trade and commercial world and the set of pacts -- from the Transatlantic Trade and Investment Partnership (TTIP) for Europe to the Trans-Pacific Partnership (TPP) for Asia -- that would go with it.

When Dragon Embraces Bear

Russian President Vladimir Putin had a fabulous APEC. After his country and China clinched a massive $400 billion natural gas deal in May -- around the Power of Siberia pipeline, whose construction began this year -- they added a second agreement worth $325 billion around the Altai pipeline originating in western Siberia.

These two mega-energy deals don’t mean that Beijing will become Moscow-dependent when it comes to energy, though it’s estimated that they will provide 17% of China's natural gas needs by 2020. (Gas, however, makes up only 10% percent of China's energy mix at present.)  But these deals signal where the wind is blowing in the heart of Eurasia. Though Chinese banks can’t replace those affected by Washington and EU sanctions against Russia, they are offering a Moscow battered by recent plummeting oil prices some relief in the form of access to Chinese credit.  

On the military front, Russia and China are now committed to large-scale joint military exercises, while Russia’s advanced S-400 air defense missile system will soon enough be heading for Beijing.  In addition, for the first time in the post-Cold War era, Putin recently raised the old Soviet-era doctrine of “collective security” in Asia as a possible pillar for a new Sino-Russian strategic partnership.

Chinese President Xi has taken to calling all this the “evergreen tree of Chinese-Russian friendship” -- or you could think of it as Putin’s strategic “pivot” to China.  In either case, Washington is not exactly thrilled to see Russia and China beginning to mesh their strengths: Russian excellence in aerospace, defense technology, and heavy equipment manufacturing matching Chinese excellence in agriculture, light industry, and information technology.

It’s also been clear for years that across Eurasia Russian, not Western, pipelines are likely to prevail. The latest spectacular Pipelineistan opera -- Gazprom’s cancellation of the prospective South Stream pipeline that was to bring yet more Russian natural gas to Europe -- will, in the end, only guarantee an even greater energy integration of both Turkey and Russia into the new Eurasia. 

So Long to the Unipolar Moment 

All these interlocked developments suggest a geopolitical tectonic shift in Eurasia that the American media simply hasn’t begun to grasp. Which doesn’t mean that no one notices anything.  You can smell the incipient panic in the air in the Washington establishment.  The Council on Foreign Relations is already publishing laments about the possibility that the former sole superpower’s exceptionalist moment is “unraveling.” The U.S.-China Economic and Security Review Commission can only blame the Chinese leadership for being “disloyal,” adverse to “reform,” and an enemy of the “liberalization” of their own economy.

The usual suspects carp that upstart China is upsetting the "international order," will doom “peace and prosperity” in Asia for all eternity, and may be creating a "new kind of Cold War" in the region. From Washington’s perspective, a rising China, of course, remains the major “threat” in Asia, if not the world, even as the Pentagon spends gigantic sums to keep its sprawling global empire of bases intact. Those Washington-based stories about the new China threat in the Pacific and Southeast Asia, however, never mention that China remains encircled by U.S. bases, while lacking a base of its own outside its territory. 

Of course, China does face titanic problems, including the pressures being applied by the globe’s “sole superpower.” Among other things, Beijing fears threats to the security of its sea-borne energy supply from abroad, which helps explain its massive investment in helping create a welcoming Eurasian Pipelineistan from Central Asia to Siberia. Fears for its energy future also explain its urge to “escape from Malacca” by reaching for energy supplies in Africa and South America, and its much-discussed offensive to claim energy-rich areas of the East and South China seas, which Beijing is betting could become a “second Persian Gulf,” ultimately yielding 130 billion barrels of oil.

On the internal front, President Xi has outlined in detail his vision of a “results-oriented” path for his country over the next decade. As road maps go, China’s “must-do” list of reforms is nothing short of impressive. And worrying about keeping China’s economy, already the world’s number one by size, rolling along at a feverish pitch, Xi is also turbo-charging the fight against corruption, graft, and waste, especially within the Communist Party itself.

Economic efficiency is another crucial problem. Chinese state-owned enterprises are now investing a staggering $2.3 trillion a year -- 43% of the country’s total investment -- in infrastructure. Yet studies at Tsinghua University’s School of Management have shown that an array of investments in facilities ranging from steel mills to cement factories have only added to overcapacity, and so actually undercut China’s productivity.

Xiaolu Wang and Yixiao Zhou, authors of the academic paper “Deepening Reform for China's Long-term Growth and Development,” contend that it will be difficult for China to jump from middle-income to high-income status -- a key requirement for a truly global power. For this, an avalanche of extra government funds would have to go into areas like social security/unemployment benefits and healthcare, which take up at present 9.8% and 15.1% of the 2014 budget -- high for some Western countries but not high enough for China’s needs.

Still, anyone who has closely followed what China has accomplished over these past three decades knows that, whatever its problems, whatever the threats, it won’t fall apart. As a measure of the country’s ambitions for economically reconfiguring the commercial and power maps of the world, China’s leaders are also thinking about how, in the near future, relations with Europe, too, could be reshaped in ways that would be historic. 

What About That “Harmonious Community”?

At the same moment that China is proposing a new Eurasian integration, Washington has opted for an “empire of chaos,” a dysfunctional global system now breeding mayhem and blowback across the Greater Middle East into Africa and even to the peripheries of Europe.

In this context, a “new Cold War” paranoia is on the rise in the U.S., Europe, and Russia.  Former Soviet leader Mikhail Gorbachev, who knows a thing or two about Cold Wars (having ended one), couldn’t be more alarmed. Washington’s agenda of “isolating” and arguably crippling Russia is ultimately dangerous, even if in the long run it may also be doomed to failure. 

At the moment, whatever its weaknesses, Moscow remains the only power capable of negotiating a global strategic balance with Washington and putting some limits on its empire of chaos.  NATO nations still follow meekly in Washington’s wake and China as yet lacks the strategic clout.

Russia, like China, is betting on Eurasian integration.  No one, of course, knows how all this will end.  Only four years ago, Vladimir Putin was proposing “a harmonious economic community stretching from Lisbon to Vladivostok,” involving a trans-Eurasian free trade agreement. Yet today, with the U.S., NATO, and Russia locked in a Cold War-like battle in the shadows over Ukraine, and with the European Union incapable of disentangling itself from NATO, the most immediate new paradigm seems to be less total integration than war hysteria and fear of future chaos spreading to other parts of Eurasia.

Don’t rule out a change in the dynamics of the situation, however.  In the long run, it seems to be in the cards.  One day, Germany may lead parts of Europe away from NATO’s “logic,” since German business leaders and industrialists have an eye on their potentially lucrative commercial future in a new Eurasia. Strange as it might seem amid today’s war of words over Ukraine, the endgame could still prove to involve a Berlin-Moscow-Beijing alliance.

At present, the choice between the two available models on the planet seems stark indeed: Eurasian integration or a spreading empire of chaos. China and Russia know what they want, and so, it seems, does Washington.  The question is: What will the other moving parts of Eurasia choose to do?

Pepe Escobar is the roving correspondent for Asia Times/Hong Kong, an analyst for RT, and a TomDispatch regular. His latest book is Empire of Chaos (Nimble Books). Follow him on Facebook.