CHALMERS JOHNSON ON WHY THE US HAS REALLY GONE BROKE PAGE 2

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FEBRUARY2008

RADICALISLAMISTSEXPLOITA FRAGMENTED COUNTRY

Al-Qaida roots itself in Lebanon

Last year the Lebanese army besieged the Palestinian camp of Nahr al-Bared,where a previously unknown organisation,Fatah al-Islam,was dug in. These events,like attacks on the UN Interim Force in Lebanon, reflect the appearance of radical Sunni Islamist networks,some of them linked to al-Qaida,which is now treating Lebanon as a key base

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Money and power shift east PIERREALECHINSKY – ‘Adverse volcano’ (1972)

Will the US Federal Reserve’s announcement of a substantial cut in interest rates avert a recession in the United States and banish the spectre of a worldwide crash? Many experts think it will. At worst, they think the growth rate may slow down. Other observers in the capitalist camp are very worried. In France, Jacques Attali foresees a crash on Wall Street, home of the New York stock exchange and ultimate guarantor of the loan pyramid (1), and Michel Rocard is convinced that a world crisis is imminent and that the system is about to explode (2). There are many signs of alarm. There is a renewed interest in gold reserves and a rush to buy – the price of gold rose by 32% in 2007. All the major economic institutions, including the International Monetary Fund and the Organisation for Economic Cooperation and Development, predict lower growth worldwide. This all started when the internet bubble burst in 2001. To rescue investors, the then US Federal Reserve chairman Alan Greenspan decided to promote the property market by introducing a policy of very low interest rates, and reducing financial charges. This gave financial intermediaries and property dealers an incentive to persuade more people to invest in bricks and mortar. Hence the system of subprimes, high-risk variable-rate mortgage loans for low-income families or those with poor credit. But in 2005 the Federal Reserve raised the base rates – those it had just reduced. This threw the whole system out of gear and the effects hit the international banking system in August 2007. With three million US families facing insolvency and debts totalling $200bn, some major credit institutions ran out of funds. To cover themselves

against this contingency, they had sold some questionable debts on to other banks. The banks put the debts into speculative investment funds, and the funds passed them on to banks all over the world. So the crisis spread and rapidly engulfed the entire banking system. Major financial institutions, including Citigroup and Merrill Lynch in the US, Northern Rock in Britain, Swiss Re and UBS in Switzerland and Sociéétéé Géénéérale in France, incurred huge losses and suspect there are more to come. To limit the damage, many had to accept funds from sovereign sources controlled by southern powers or oil-rich regimes. The real extent of the damage is not yet clear. The central banks in the US, Europe, the UK, Switzerland and Japan have poured hundreds of billions of dollars into the economy since August 2007, but confidence was not restored. The crisis spread from the financial sector to the rest of the economy. Several factors – a rapid drop in house prices in the US, the UK, Ireland and Spain, the fall in the dollar, the credit squeeze – point to a decline in growth. Add to this the increase in the price of oil, raw materials and food products. All the ingredients for a crisis that will last for some time, the greatest crisis since the structure of the world economy has been based on globalisation. The outcome depends on whether the Asian economies can take over from the US as the driving force. Another sign, perhaps, that the West is in decline and that the centre of the world economy is about to shift from the US to China. The crisis may mark the end of an era. IGNACIO RAMONET TRANSLATED BY BARBARA WILSON

(1) L’Express, Paris, 13 December 2007. (2) Le Nouvel Observateur , Paris, 13 December 2007.

INSIDE THIS ISSUE

East Timor:the people’s struggle to rebuild their lives page 4

Kenya:east Africa’s model for stability comes off the rails page 5

How the ANCleadership in South Africa lost touch page 6

Can Balkan borders be redrawn along ethnic lines? page 8

Nepal’s Gurkha veterans fight a final battle against neglect page 12

Why do girls shun a career in computing? page 13

Popping the bubbles in Bernard-Henri Léévy’s champagne socialism page 14

What France really wants from Simone de Beauvoir page 16

BY FIDAA ITANI

“We were forcibly thrust into a battle that does not concern us. I would rather not have had to fight the Lebanese army,” said Shahin Shahin, a Fatah al-Islam military commander, to a negotiator during the siege of the Palestinian refugee camp of Nahr al-Bared by the Lebanese army. It was not then yet known that he was a son of Osama bin Laden and a high-ranking al-Qaida official. His misgivings about the fighting reflected his organisation’s ambivalence towards Lebanon – whether to see the country as a battleground on which to confront the United States and its allies, or just as a rear base for the training and transit of al-Qaida operatives. Two days after the army gained control of the camp, on 4 September, the head of Lebanese military intelligence, Georges Khoury, acknowledged that the Fatah al-Islam combatants were members of al-Qaida. But the roots of the organisation in Lebanon reach deeper into the past. In the 1990s Lebanese courts found Salafists (see “Who is a Salafist?”, page 10) guilty of forming terrorist cells linked to al-Qaida. The militants were Lebanese following the example of Salem al-Shahal, who started Lebanon’s first Muslimun (Muslim) and Shabab Muhammad (Youth of Muhammad) groups in Tripoli in 1974. Shahal tried to impose sharia in the city, starting by attempting to prevent young people going to the cinema. His influence spread to several Syrian towns, but at the time Salafist values lacked solid roots. In those days the Sunnis were middle class traders, shopkeepers and civil servants, or illiterate country people. They expressed their support for Arab nationalism and the Palestinian struggle by joining Nasserite or leftwing movements. However, several Sunni groups moved closer to radical Islamism after Syrian troops occupied Lebanon in 1976, bringing repression with them. At the same time the influence of the Syrian branch of the Muslim Brotherhood started to increase, threatening the regime in Damascus with armed incursions by its military wing. When the civil war in Lebanon ended in 1989, with the signature of the Taif accord, the Salafists, whose influence was still only limited, mainly targeted other Islamic organisations, al-Ahbash (1) or the Association of Islamic Charitable Projects (AICP). These attacks were an opportunity for the Salafist groups to perfect their intellectual and missionary skills, recruiting in many towns and villages. They were particularly successful with middle-class graduates, as well as with students of theology who had been in Saudi Arabia and stayed in contact with radical ulemathere. But the groups still lacked cohesion, the best known being alHidayah wal-Ihsan (Preaching and Charity), which was reorganised by the son of the movement’s

Fidaa Itani is a Beirut-based journalist

founder, Dai al-Islam al-Shahal. On 31 August 1995 one of these groups assassinated Sheikh Nizar al-Halabi, the head of the AICP, and caused a stir. It was the first time that a Salafist group had eliminated an opponent. Members of the organisation confessed to committing the murder and persisted in taking exclusive responsibility to the end. However, the Lebanese authorities and Syrian intelligence (which controlled the country) chose to pin the crime on Abdul Karim al-Saadi (aka Abu Mahjen), the Palestinian leader of Asbat al-Ansar, which was based in the Ayn al-Hilwah refugee camp, near Saida in southern Lebanon. In 1999 the same group, originally formed by veterans from the war in Afghanistan, was blamed for the assassination of four judges in Saida central court. At this point links between the Salafists and alQaida started to develop. An organisation that was probably Chechen, and certainly connected to Bin Laden, asked Bassam Kanj (aka Abu Aisha) to help infiltrate Muslim combatants into Israel. In 1988 Kanj had given up his studies in the US and taken a crash course in global jihad in Afghanistan. Following the request from al-Qaida he set up the Dinniyeh organisation, but asked for two years’ grace to establish it as an anti-Israeli resistance force, alongside Hizbullah. In May 2000 Russian negotiators, who were supervising the Israeli withdrawal from South Lebanon with the Syrians, gave the Lebanese and Syrian authorities a recording of a conversation between Kanj and Chechen mujahideen, which led to a Lebanese army raid on Dinniyeh on New Year’s Eve 2001. At the same time the Syrian authorities, operating on the other side of the border, arrested radical Islamists, confirming the network’s transnational nature. Al-Qaida waited till the US invasion of Iraq in March 2003 before openly calling for units to be set up in Lebanon. But al-Qaida also operates as a form of franchise, with a far from centralised organisation, leaving considerable freedom of movement to local units. It was well established by the end of 2005 when the Lebanese authorities first succeeded in catching the members of a network, subsequently referred to as the “Network of 13”, led by Hassan Nabaa, a Lebanese national. The group, which also comprised Saudis, Syrians and Palestinians, supported al-Qaida and the Iraqi resistance movement, operating in Lebanon and Syria where it clashed on several occasions with the secret service, particularly in border zones. It is said to have shot down a Syrian helicopter. The arrests prompted a controversy because the prisoners’confessions contained details of their involvement in the assassination of the former prime minister, Rafik Hariri, on 14 February 2005. But there is doubt about how the confessions were

Continued on page 10