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Web Log - April, 2021


19-Apr-21 World View -- Britain sends warships to Black Sea amid Russia's military buildup around Ukraine

Britain to send warships to Black Sea after US backs down

by John J. Xenakis

This morning's key headlines from

Britain sends warships to Black Sea amid Russia's military buildup around Ukraine

Ukraine.  In 2014, Russia invaded and occupied Donbas, and invaded and annexed Crimea.  In 2018, Russia completed a bridge over the Kerch Strait, controlling access to the Sea of Azov.
Ukraine. In 2014, Russia invaded and occupied Donbas, and invaded and annexed Crimea. In 2018, Russia completed a bridge over the Kerch Strait, controlling access to the Sea of Azov.

Britain is reported to be sending two warships to the Black Sea, as Russia continues its military buildup on the Ukraine border, and a naval buildup in the Black Sea. Britain's announcement came when the US backed out of plans to send ships to the Black Sea after being warned by Russia to stay out.

Russia appears to be taking the next step in a plan that began with its invasion of eastern Ukraine in 2014, following a military buildup on the border of Ukraine similar to the military buildup going on at the current time. The invasion took place after Vladimir Putin promised not to invade Ukraine.

During the course of that invasion, Russians in eastern Ukraine in July 2014 shot down a passenger plane, Malaysia Airlines Flight MH17, with a Russian Buk 9M38 missile. The Russians claimed that the US shot down the plane to embarrass Putin. Russia lied about not invading Crimea, and then invaded Crimea. Putin lied about not annexing Crimea, and then annexed Crimea.

In May 2015, Russia began constructing an 11.8 mile bridge across the Kerch Strait (see map above), said to be the longest bridge in Europe.

Russia used the bridge to strangle commerce into Ukraine's seaports of Mariupol and Berdyansk, resulting in substantial economic damage to Ukraine. In November 2018, Russia completed the bridge, and opened live fire for no reason on three Ukrainian vessels, wounding six sailors, boarding and seizing the vessels. The sailors were transferred indefinitely to a jail in Moscow.

The point of reviewing this history is to set the framework for Russia's latest actions, and to show that pretty much everything Russia claims is garbage. The typical Russian playbook is to commit some atrocity and then blame the United States or Nato, such as when the Russians shot down the MH17 passenger plane.

In the current scene, Russian analysts are claiming that the military buildup is because the United States wants Ukraine to join Nato, and because Ukraine is planning to invade Russia. Over the years, I've dealt with dozens of Russian trolls excusing Russia atrocities with some of the most ridiculous excuses, and this is typical.

The problem is that we have absolutely no idea what the Russians are planning.

Whatever military action Russia is planning will probably take place in early or mid-May, after the snows have melted and the fields have dried and are able to hold tanks. We'll have to wait until then to see which of these options Russia will pursue.

Russia builds up its naval forces in Black Sea

Coinciding with the huge build-up of over 100,000 Russian troops near the border with Ukraine, Russia is bolstering its naval fleet in the Black Sea.

Two Russian warships from Russia's Baltic fleet, accompanied by 15 smaller vessels, transited from the Mediterranean Sea through the Bosphorus to the Black Sea on Saturday. The Bosphorus is the waterway, controlled by Turkey, connecting the Mediterranean Sea with the Black Sea.

This comes after Russia announced that Russia is sending 15 naval vessels from its Caspian Sea Flotilla to the Black Sea. These vessels must travel up the Volga River, through a canal built in 1952 with 13 locks, to the Don River, and then to the Sea of Azov and the Black Sea.

So Russia's naval buildup is large and expensive, just like its ground buildup.

Britain to send warships to Black Sea after US backs down

Map of Russian deployment around Ukraine (RFE/RL)
Map of Russian deployment around Ukraine (RFE/RL)

There are a number of news stories from multiple international sources describing this situation, and they seem to boil down to the following:

The US was planning to send two warships into the Black Sea, for a long-scheduled routine mission. However, Russia warned the United States on Tuesday (4/13) against sending the warships, "for their own good." Russia's Deputy Foreign Ministry Sergei Ryabkov was quoted by Russian news agencies as follows:

"There is absolutely nothing for American ships to be doing near our shores. We warn the United States that it will be better for them to stay far away from Crimea and our Black Sea coast. It will be for their own good."

Also on Tuesday, president Joe Biden phoned Russia's president Vladimir Putin, after which the US backed down on the plans to send warships to the Black Sea. US officials described the reason was to avoid needlessly escalating the situation, and a desire not to provoke Moscow during a delicate time.

However on Sunday, British media is reporting that a flotilla of ships from the Royal Navy's carrier task group in the Mediterranean, including a Type 45 destroyer armed with anti-aircraft missiles and an anti-submarine Type 23 frigate, will travel to the Black Sea in May. The deployment is aimed at showing solidarity with Ukraine and Britain's NATO allies.

I heard one analyst make the following speculation about what happened: Perhaps Biden fears a coordinated attack next month on Ukraine by Russia simultaneously with a Chinese attack on Taiwan, and so Biden did not want American warships to be trapped in the Black Sea.

Russia continues military buildup on Ukraine's border

If major hostilities break out again in the Donbas (eastern Ukraine), then the situation will have changed a lot since the last war in 2014, since both Ukraine's and Russia's militaries are better prepared.

Ukraine has significantly boosted defense spending since 2014, has U.S.-supplied Javelin anti-tank missiles in its arsenal, and has troop numbers of nearly 250,000 compared to 168,000 in 2013.

In recent weeks, Russia has unexpectedly boosted its troop presence near the conflict zone in Ukraine. Analysis of open-source material has identified tanks, infantry fighting vehicles, long-range artillery, rocket launchers, and Iskander short-range ballistic missile systems among the materiel that has been moved to the area since mid-March. U.S. and NATO officials have called it the largest military buildup in the region since Russia’s surprise occupation of Crimea and the start of fighting in the Donbas, which has killed more than 13,000 combatants and civilians since April 2014.

So what are Russia's plans? We probably won't know until early to mid-May.

Major diplomatic row between Russia and Czech Republic

This is a (probably) unrelated story, but it's being described as a major diplomatic development between Russia and Europe.

The Czech Republic expelled 18 Russian diplomats on Saturday. Czech local intelligence agents claim the diplomats are Russian intelligence operatives. They are suspected of involvement in an explosion at an arms depot in 2014. On Sunday, Russia retaliated by announcing that 20 diplomats from the Czech Republic will be expelled. At the time of the explosion, it was assumed to be an accident, but through detective work, Czech officials now say that it was Russian sabotage.

Czech Police have identified two suspects in connection with the blast - Alexander Mishkin and Anatoly Chepigov - who are also accused of using the chemical nerve agent weapon Novichok to murder Sergei Skripal, a former double Russian agent, and his daughter Yulia. The murder took place in the UK in Salisbury in 2018.


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15-Apr-21 World View -- High farce and tragedy continue in Afghanistan, as Biden announces Sept 11 troop withdrawal

CNN: Biden guided by 'magical thinking' in Afghanistan

by John J. Xenakis

This morning's key headlines from

High farce and tragedy continue in Afghanistan, as Biden announces Sept 11 troop withdrawal

Girls in Afghanistan will no longer be in school if the US withdraws and the Taliban takes over (NY Times)
Girls in Afghanistan will no longer be in school if the US withdraws and the Taliban takes over (NY Times)

President Joe Biden announced on Wednesday that all American troops would be withdrawn by September 11 of this year, the 20th anniversary of the 9/11/2001 attacks, and that Nato troops would be withdrawn at the same time. This would be farcical if it weren't so tragic.

How many times have we been here? The President announces a new policy -- "surge" into Afghanistan, a "victory" in Afghanistan, or a "peace with honor" in Afghanistan. I write an article explaining why all of those are impossible, based on a Generational Dynamics analysis summarized later in this article. The new policy fails, exactly as I predicted. But nobody ever learns.

So last year, Donald Trump made a farcical agreement with the Taliban that if they changed their behavior, then the US would withdraw its troops by May 1 of this year. Trump's reason was that Americans are tired of "endless wars." (A bit of irony: Biden's announcement was described by the fawning mainstream media as "historic," but Trump's similar announcement was not.)

So now Joe Biden is president, and he made a farcical announcement that the troops will be removed by September 11 of this year -- the 20th anniversary of the 9/11/2001 attack. I always accuse the Biden administration of having no clue what's going on in the world, but this takes the cake. We can expect the Taliban to engineer a major terrorist attack on September 11 to celebrate their victory over the Americans, having achieved their objective of forcing the Americans to withdraw.

In his speech, Biden said:

"I believed that our presence in Afghanistan should be focused on the reason we went in the first place: to ensure Afghanistan would not be used as a base from which to attack our homeland again. We did that. We accomplished that objective.

I said, among — with others, we’d follow Osama bin Laden to the gates of hell if need be. That’s exactly what we did, and we got him. It took us close to 10 years to put President Obama’s commitment to — into form. And that’s exactly what happened; Osama bin Laden was gone.

That was 10 years ago. Think about that. We delivered justice to bin Laden a decade ago, and we’ve stayed in Afghanistan for a decade since. Since then, our reasons for remaining in Afghanistan are becoming increasingly unclear, even as the terrorist threat that we went to fight evolved."

So Biden's argument is that America went into Afghanistan to defeat al-Qaeda, but now that al-Qaeda has been defeated, there's no need for American troops to remain.

There was one difference between the terms of the Trump and Biden announcements. Trump's May 1 deadline was "condition based," meaning that if the Taliban didn't behave, then Trump might extend the deadline. This was explained by Biden's press spokesman, Jen Psaki:

"[Question: And could his deadline extend, or could he change his mind if you do see the situation in Afghanistan just decline?]

Psaki: Well, I will say that the president made this decision after close consultations and a close discussion and taking into account all the difficult factors I should say around that decision. So no, he remains committed to the timeline that he intends to set out in his speech. ...

[Question: I don’t think I’ve heard in the answers so far, what the Taliban is supposed to think about this. I mean, if I was them, I think I’d want to take the summer off and wait until September 11th. And why go ahead and negotiate an agreement that would limit them if the U.S. is going to leave anyway?]

Jen Psaki: Well, first I would say that we have an expectation that the Taliban is going to abide by their commitments and that they are not going to allow Afghanistan to become a pariah state. That’s our view. That’s also in their interest, in our view. ...

And his view is that, when you talk about a conditions-based withdrawal, it punts it down the road, “We will never leave. What conditions would we be required to leave? By how long? What does that mean? What’s the additional cost?” These are all the factors in his mind."

First off, the "expectation that the Taliban is going to abide by their commitments" is totally delusional.

This answer illustrates the conundrum that Biden and Psaki did not unravel.

On the one hand, if the withdrawal date is unconditional, then the Taliban will have every reason to continue terrorist acts. In fact, the Taliban have announced that they won't attend an Afghanistan peace conference being hosted by Turkey. Why should they?

On the other hand, if the withdrawal date is conditional then, as Psaki says, the date will just be kicked down the road again.

So the question is this: Will Biden go ahead with the withdrawal as announced, and hand the Taliban a victory? Or will he be forced to reconsider the withdrawal decision?

CNN: Biden guided by 'magical thinking' in Afghanistan

A number of analysts have ridiculed Biden's withdrawal announcement and the delusions behind it. One of them is Peter Bergen, the National Security Analysts for CNN, the network that fawns over Biden so much they've turned into a sewer. So Peter Bergen's analysis cannot readily be rejected as the opinion of a "white supremacist," or whatever CNN calls anyone who disagrees with them.

According to Bergen:

"President Biden's decision to announce a date for pulling all US troops out of Afghanistan by the 20th anniversary of 9/11 sets the stage for a predictable disaster. ...

There has to be some magical thinking going on for the Biden White House to expect that there will be a different outcome in Afghanistan [than in President Obama's precipitous withdrawal from Iraq].

Yes, al Qaeda is a mere shadow of what it was on 9/11. That's because for the past two decades, the US and its allies have prevented Afghanistan from becoming a safe haven for al Qaeda and allied groups.

It's a policy that has worked.

Now, that sound policy is being abandoned. Once the US leaves Afghanistan, America's NATO allies, who have 7,000 soldiers on the ground, will leave as well, since they rely on an American security umbrella. President Biden confirmed this in his speech to the nation Wednesday afternoon.

The pullout of US and NATO troops will likely enable the Taliban to take over much of the country."

Bergen explains that the Taliban have remained in close contact with al-Qaeda, and they've guaranteed that they "would honor their historical ties" with al-Qaeda. Furthermore, ISIS retains a foothold in Afghanistan.

As Bergen pointed out, the US and Nato have prevented Afghanistan from becoming a safe haven for al-Qaeda and allied groups. Once the allied forces pull out, Afghanistan will once again become a safe haven for both al-Qaeda and ISIS, just as Osama bin Laden used Afghanistan as a safe haven to launch the original 9/11/2001 attacks.

It's not just Peter Bergen who is alarmed at the withdrawal decision. The New York Times, which always fawningly slobbers over Biden, is worried for the girls of Afghanistan. According to the Times:

"“I am so worried about my future. It seems so murky. If the Taliban take over, I lose my identity,” said Wahida Sadeqi, 17, an 11th grader at Pardis High School in Kabul. “It is about my existence.” ...

For two decades, American leaders have pledged peace, prosperity, democracy, the end of terrorism and rights for women. Few of those promises have materialized in vast areas of Afghanistan, but now even in the cities where real progress occurred, there is fear that everything will be lost when the Americans leave. ...

Over two decades, the American mission evolved from hunting terrorists to helping the government build the institutions of a functioning government, dismantle the Taliban and empower women. But the U.S. and Afghan militaries were never able to effectively destroy the Taliban, allowing the insurgents to stage a comeback. ...

Women would be most at risk under Taliban rule. When the group controlled Afghanistan from 1996 to 2001, it banned women from taking most jobs or receiving educations and practically made them prisoners in their own homes."

Biden administration officials might be thinking to paraphrase Lyndon Johnson's statement from 53 years ago, referring to Walter Cronkite: "If we've lost the NY Times, then we've lost America."

The interesting thing about the NY Times article is that it seems to reject the delusional Biden administration claim that the Afghan democracy will continue. The article simply assumes that the Taliban will take over, and will impose the same dictatorial government they had in 2001, when they sponsored Osama bin Laden's attack on America.

Analysts who favor continuing to leave a small number (3,500) of American troops in Afghanistan point out that these can prevent a resurgence of al-Qaeda and ISIS, and can also provide a listening post and forward military base to counter Chinese military activity in Central Asia. On the other hand, once America closes its bases in landlocked Afghanistan, they can never be reopened.

Generational Dynamics analysis of the war in Afghanistan

I began writing about the impossibility of winning in Afghanistan shortly after President Obama announced his plan to "surge" troops into Afghanistan.

President Bush had used a successful "surge" counter-insurgency strategy in Iraq in 2007, with the result that al-Qaeda was driven out of Iraq, and the objectives were met. But al-Qaeda in Iraq were mostly not Iraqis. They were jihadists that al-Qaeda leader Abu Musab al-Zarqawi had imported from Jordan and Saudi Arabia. The Iraqis themselves, even the Sunnis, mostly hated al-Qaeda, as I described in a lengthy analysis, "Iraqi Sunnis are turning against al-Qaeda in Iraq".

But the Taliban could not be defeated in a similar way in Afghanistan, because the Taliban are radicalized ethnic Pashtuns, and most of the population of Afghanistan are Pashtuns.

In an article earlier this year, I was able to extend this original analysis, based on research that I had done for my book, "Vietnam, Buddhism and the Vietnam War." In that book, I compared the counter-insurgency strategies used by British in the Boer War (1899-1902) and the Malay Emergency (1948-55), and how they contrasted to similar counter-insurgency strategies used by the Americans in Vietnam, Iraq and Afghanistan. (See "18-Jan-21 World View -- Chaos grows in Afghanistan as American troops leave in hope of delusional peace plan")

But the extended analysis is based on the same reasoning: In Iraq, the civilians and jihadists looked different and spoke differently. In Afghanistan, the civilians and jihadists are the same Pashtun people.

Let's face it, most politicians and journalists are ignorant and dumb. They have no knowledge of Afghanistan's last generational crisis war, an extremely bloody, horrific civil war, in 1991-96, that defines Afghan society today. The war was a civil war, fought between the Pashtuns in southern Afghanistan versus the Northern Alliance of Tajiks, Hazaras and Uzbeks in northern Afghanistan. The Taliban are radicalized Pashtuns, and when they need to import foreign fighters, then can import their cousins from the Pashtun tribes in Pakistan.

Indeed, it's much worse than that. The ethnic groups in Afghanistan are COMPLETELY NON-UNITED and loathe each other. Pashtuns still have scores to settle with the Tajiks, Hazaras and Uzbeks that formed the Northern Alliance, especially the Shias. These opposing groups have fresh memories of the atrocities, torture, rape, beatings, dismemberments, mutilations, and so forth that the other side performed on their friends, wives and other family members, and they have no desire to be friends or to work together. They'd rather kill each other.

So what is Biden going to do? If he goes ahead with the withdrawal, then it's 100% certain that Afghanistan will collapse into chaos, and it's likely that the Taliban will take control of the government, and everything that America's sacrifices brought to Afghanistan -- democracy, women's rights, relative peace -- will be lost within a few months.


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13-Apr-21 World View -- Investing in Decentralized Finance (DeFi) and Smart Contracts

Sabotage and fraud in DeFi and Smart Contracts

by John J. Xenakis

This morning's key headlines from

Investing in Decentralized Finance (DeFi) and Smart Contracts

How Smart Contracts Work (Deccan Herald)
How Smart Contracts Work (Deccan Herald)

I've been asked about investing in the crypto-currency (Bitcoin) related technologies, Decentralized Finance (DeFi) and Smart Contracts, which use the same internet-based blockchain technology as Bitcoin.

For over a decade, crypto currencies have been the highly stylish, fashionable rock star finance technology, but lately they've been losing their glamor and lustre as compared to a newer technology, "decentralized finance" (DeFi) and "smart contracts."

It was just a few years ago that people were saying that the world was just a stone's throw away from having a universal currency (Bitcoin) that was independent of any nation. Last week, I read one analyst saying, "We are a stone’s throw away from the global financial industry running on a common software infrastructure." Well, that stone would have to land something like 20-30 or more years in the future, and if humans haven't figured out how to do it by then, then perhaps our computer overlords will do it for us.

What's happening now is that there's an explosion of financial applications and services, normally provided by banks, brokers, and other financial institution, that are now being provided on blockchain platforms as "smart contracts." There are really an unlimited number of possible apps and services -- insurance, lending, borrowing, asset management, gaming, day trading, savings, payments, billing, and so forth. Smart contracts are "self-executing," meaning that once a particular smart contract is set up, any action that would normally be taken by a human intermediary in a bank or financial institution would now be executed automatically by the smart contract.

Another way of looking at it is to compare a smart contract to workflow software that has been around since the 90s. The software is set up with a set of workflow rules, and when the appropriate conditions specified by the rules are satisfied, then the workflow software sends out e-mail messages to the appropriate people, telling them to take the appropriate action.

DeFi applications are more powerful because typically they have control of crypto assets, so when the right conditions are met, the app does not send out an e-mail saying "buy a new car." Instead, it automatically issues the paperwork to buy a new car.

There are several ways to invest in DeFi technology. You can set up a financial relationship with someone else using a smart contract. Or you could invest in companies that develop these apps or offer services using this technology.

The following web site provides a pretty extensive list of companies offering such apps and services at the current time:

Automated processing on IBM mainframes in the 1960s

Although Decentralized Finance and Smart Contracts are a brand-new, shiny technology, there are problems and dangers that can be learned from history. Let's look at some historical examples.

Back in the 1960s, accounting systems were developed for IBM mainframe systems, and they were only a stone's throw from never needing human accountants again, according to experts.

The transaction processing systems used magnetic tapes. A typical processing run required three tapes -- an input tape of existing account records, an input tape of new transaction records, and an output tape of updated account records. The two input tapes are pre-sorted by account number so that they can be processed simultaneously in order of account. It's therefore possibe to update the accounts with only one pass through the transaction tape, writing the updated accounts to the output tape, which would be the existing accounts input tape for the next day's run.

So let's take a look at some of the issues. The most obvious one is that the mainframe might be down, so that the transaction processing run could not take place. Another issue is that mag tapes are somewhat fragile, and data could be lost.

Another possible problem is that the transaction processing software could have a bug, since all software has bugs. So if the bug affects several thousand accounts, then it's possible that a single run could result in several thousand errors caused by the bug, and they wouldn't be caught until much later.

That's when people started saying things like, "To err is human. To really screw things up takes a computer."

Intentional sabotage in automated processing

Another problem was intentional sabotage. The mag tape transaction processing that I described was subject to a very interesting form of sabotage.

Some transactions involve division of two numbers, and result in an amount with a fraction of a penny. The correct algorithm would round to the nearest penny, and the resulting amount would be used in the transaction. But one developer did something different. His software contained secret code that deducted the fractional penny from the amount, and credited it to his own account. Tens of thousands of fractions of a penny adds up to real money. He made a lot of money that way, but the consequences of what he had done were not discovered until much later.

The thing that makes this kind of sabotage possible is that managers don't understand what the programmers are doing. There was a similar problem with the financial crisis of the 2000s. The Gen-X financial engineers got their Masters Degrees in the 1990s, and applied those skills to create fraudulent synthetic securities based on subprime mortgages. Their managers in the financial institutions had no idea how they worked, except that they made lots of money, and the result was the financial crisis. In the late 2000s I was working on a government system where the lead programmer was sabotaging the code (my code, in particular). I complained repeatedly to my boss, but he refused to believe me. Eventually, the lead programmer screwed around with someone else's code, someone really important, and my manager apologized to me. This shows that the consequences of sabotage are not usually discovered until much later.

Another example was the Obamacare website President Obama launched Obamacare on the afternoon of Oct 1, 2013, and he had no idea that the web site wasn't even working. When he announced the launch, he had no idea a disaster had unfolded several hours earlier. As I wrote in my 2015 article, massive fraud had occurred among all the consulting firms, and they propagated lies all the way up the chain. The entire White House had no idea of the disaster until it was too late. (See: " -- The greatest software development disaster in history")

So there was massive fraud in the development of Obamacare, which no one cares about since caring about Obamacare fraud is politically censored. Similarly, with tens of millions of mail-in ballots sent out last year there was massive fraud in the 2020 election that no one cares about, since caring about fraud in the 2020 election is politically censored.

The reason for mentioning all this is that the DeFi technology will be a huge target for sabotage and fraud, and the people benefiting from the fraud may want it censored. This concern is being politically censored because the major beneficiaries -- Silicon Valley, the Chinese, the Democrats, hedge funds -- don't want it discussed.

Sabotage and fraud in DeFi and Smart Contracts

Blockchain technology has this magical, mystical reputation as being incorruptible -- open source, "tamper-proof data," transparency, permissionless access, etc. Obamacare had the same magical, mystical reputation, and the amount of fraud was massive. The mainstream media didn't want to see it, because it was censored. The housing bubble of the early-mid 2000s was obvious (I was writing about it, Alan Greenspan was talking about it), but mainstream media didn't want to see it until 2009, when millions of people had lost their homes or went bankrupt. The mainstream media don't want to see the massive voter fraud in the 2020 election.

So there's no doubt that as DeFi grows, there will be lots of bugs and plenty of fraud, sabotage and corruption. This will be done at technical levels, and managers won't even know that it's going on until there are severe consequences and it's too late. In particular, it's absolutely certain that China's military is already developing tools to hack into DeFi applications, to control them.

There's another issue that's analogous to the 1960s IBM mainframe being unavailable, and this applies to all blockchain technologies: There may be a crisis (flood, hurricane, Chinese sabotage, malware, war), and the internet could become unavailable, or large numbers of servers along the blockchain could be destroyed.

Due diligence in DeFi and Smart Contract investments

So you can invest in DeFi at any of several levels. You can invest in companies developing core low-level technologies, or in companies developing mid-level API platforms, or in companies developing the top level apps that people and corporations actually use in their business. Or, you could invest by using one of the apps for its business relationships. The investment at any of these levels would be subject to the same concerns that I've raised.

So how do you do due diligence on such an investment? I believe that the biggest advantage of DeFi is also its biggest disadvantage and biggest risk -- the "self-executing" feature of "smart contracts."

Here's the investopedia definition of Smart Contracts:

A smart contract is a self-executing contract with the terms of the agreement between buyer and seller being directly written into lines of code. The code and the agreements contained therein exist across a distributed, decentralized blockchain network. The code controls the execution, and transactions are trackable and irreversible.

Smart contracts permit trusted transactions and agreements to be carried out among disparate, anonymous parties without the need for a central authority, legal system, or external enforcement mechanism.

In other words, a "smart contract" is just a software program. It will also certainly contain bugs -- because all software programs contain bugs -- and it will be subjected to sabotage, malware and hacking. And since the whole point of smart contracts is that they're "self-executing," without human involvement, and since management won't understand what's going on anyway, the bugs and sabotage won't be detected until a disaster has occurred.

Perhaps a good solution is to require "human oversight" of any smart contract. That is, if a self-executing smart contract tells you "kill your mother or pay a large fine" (and this isn't as far-fetched as it might seem, given my experience with software developers in the last 20 years), then there has to be a way for a human being on each side of the smart contract to review the self-executing action, and override it under the right circumstances.

This means that every party to a "smart contract" should have, as a backup, a printout or a pdf of a written contract that can be referenced if the internet goes down, or if there's a failure in or sabotage of the smart contract.

Unfortunately, this will only work at a small scale. DeFi applications are going to become larger and more complex, with a single app consisting of hundreds or thousands of interlocking smart contracts, and these will really be a disaster waiting to happen. But they're coming anyway. Watch for the buzzword: DAO (distributed autonomous organization), an entire business which is just a collection of smart contracts.


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11-Apr-21 World View -- Myanmar ethnic groups in Shan State launch coordinated attack on Burmese military

Peaceful protests continue in cities across Myanmar, heading for catastrophe

by John J. Xenakis

This morning's key headlines from

Myanmar ethnic groups in Shan State launch coordinated attack on Burmese military

Burmese soldiers in Shan State after an attack by ethnic groups in 2019 (AFP)
Burmese soldiers in Shan State after an attack by ethnic groups in 2019 (AFP)

An alliance of ethnic armies in Myanmar / Burma on Saturday attacked a military police station in Shan State, killing at least 10 policemen. The attackers were from an alliance that includes the Arakan Army, the Ta’ang National Liberation Army, and the Myanmar National Democratic Alliance Army. Normally, these ethnic groups oppose each other, and occasionally fight each other, but this is the first time that they've allied, in the face of the army coup, which makes this very significant.

As we've been expecting, the Myanmar / Burma military crackdown on peaceful civilian protesters, following the coup that replaced the democratically elected government with a dictatorial military junta, is rapidly turning into a full scale civil war, involving multiple ethnic groups.

This situation is growing into a repeat of Burma's last generational crisis war, an extremely bloody civil war (1948-1958) following independence, and involving multiple ethnic groups, along with intervention by the Chinese.

This attack on the police station outpost in Shan State seems to me to have special significance, in view of the genocide and ethnic cleansing of the ethnic Rohingyas in previous years.

Repeating the genocide and ethnic cleansing of Muslim Rohingyas

Starting in 2011, Buddhists began attacking Muslim Rohingyas in villages across Burma, particularly the 1.1 million ethnic Rohingyas in Rakhine State. Mobs of Buddhists attacked Muslims, conducting atrocities including torture and rape, killing hundreds and forcing hundreds of thousands to leave their homes to flee from the attacks. In some cases, the Buddhists burned down entire Rohingya villages to the ground.

However, the most horrific Buddhist violence against the Rohingyas began after August 25, 2017, when Rohingya insurgents carried out a series of coordinated attacks against 30 Burma police outposts and an army base. Using knives, some guns and homemade explosives they killed at least a dozen Burmese security force members.

The army responded with a sweep of violence against Rohingyas, causing thousands of them to flee their villages and head for the Bangladesh border, where they hoped to cross and reach a refugee camp. The Burmese army shot them as they were fleeing, including women and children, killing dozens. The attack on the police posts was the beginning of mass genocide and ethnic cleansing.

This is a standard pattern used by genocidal autocrats. I've described how this works in detail in "12-Jan-21 World View -- America and the standard Genocide Playbook". Autocratic regimes use an isolated terrorist incident as an excuse to conduct a massive overreaction against an entire group. In America, the Democrats are using the January 6 incident to declare that all 74 million Trump supporters are racists, white supremacists and terrorists, and are using that as an excuse for massive censorship and extrajucicial arrests.

So in Myanmar, we now have a situation similar to the one on August 25, 2017, when Rohingyas attacked police outposts. Saturday's attack by ethnic groups -- the Arakan Army, the Ta’ang National Liberation Army, and the Myanmar National Democratic Alliance Army -- could well bring about a repeat of what happened to the Rohingyas. We should know within the next few days.

The unifying of different ethnic groups is being described as highly significant by analysts. Over the decades, since the last crisis war, the Burmese military has been able to deal with the different ethnic groups separately, and after the February 1 coup, the military negotiated with each one to keep them out of the fighting. But now it's clear that has failed, and we can expect all out war with the ethnic groups.

These groups are on the border with China, and there are many people of Chinese ancestry living in Shan State. So this may be the trigger that leads to intervention by the Chinese, although the Chinese will not intervene unless events force them to.

War with the Karen ethnic group on the Myanmar / Thailand border

As a separate issue, Burmese regime fighter jets have been dropping bombs on ethnic Karens in territory controlled by the Karen National Union (KNU), as we reported last week. The Karens are the largest ethnic group in Burma. The bombing began on March 27 and has continued almost every day. It was triggered by an attack by the KNU on a military barracks outpost, killing 20.

Some 10,000 Karens have fled across the border into Thailand to escape the violence. This is not new. In the 1990s, a war between the preceding Burmese military junta and the Karens led to some 100,000 refugees in camps along the border between the two countries. This has caused a political problem for the Thai government, which is also led by a military junta that overthrew a democratically elected government in 2014. (See the following: "23-May-14 World View -- Thailand's army seizes power in major victory for 'yellow shirt' elites")

Thailand's last generational crisis war (the Cambodian Killing Fields war) climaxed in 1979, so Thailand is in a generational Unraveling era, with little chance of a new ethnic civil war at this time. (Burma, of course, is well into a generational Crisis era.) Therefore, Thailand's coup did not lead to civil war, but Burma's coup is doing so.

So the thousands of refugees pouring into Thailand present a problem for the Thai military junta, who basically are aligned with the Burmese military junta. So even though Thai prime minister Prayuth Chan-o-cha has assured that "human rights will be respected," the result is that many of the Karen civilians fleeing violence by crossing the border into Thailand are being pushed back into Myanmar by the Thai police.

There are also refugees pouring into India and China.

Peaceful protests continue in cities across Myanmar, heading for catastrophe

There were peaceful protests in multiple cities across Myanmar on Saturday, with large marches in Yangon and Mandalay.

This despite the fact that on Friday, 80 peaceful protesters were killed by the army in random gunfire in the city of Bago, near Yangon. The army had thought that escalating violence would cause the protests to fizzle out, as they did in 2007, during Burma's generational Unraveling era. But they're not going to fizzle out now, in a generational Crisis era.

News reports from Myanmar these days are just filled with more details about the army slaughtering innocent unarmed civiians. Analysts say that the solution is for the UN Security Council to pass a resolution, which is hilariously laughable. Others say that the Association of Southeast Nations (ASEAN) should hold a meeting, which is also laughable. I heard one analyst say that the United States has to intervene militarily to stop the carnage. That guy must have been hopped up on some of the drugs currently pouring into the USA through the open southern border.

Both Russia and China are supplying weapons to the Burmese junta, and neither country would be willing to take any step to end the carnage.

So the bottom line is this: I cannot think of a scenario, nor have I read or heard of a scenario, that will stop the violence in Myanmar / Burma from escalating into a full-scale multi-ethnic civil war in the next few days, weeks and months. Like a Greek tragedy, the characters in this play are heading unstoppably into a catastrophe of their own making. After that, the only question is whether it will spread to other countries, and whether it will be the trigger that leads to a new world war.


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(Comments: For reader comments, questions and discussion, see the Generational Dynamics World View News thread of the Generational Dynamics forum. Comments may be posted anonymously.) (11-Apr-2021) Permanent Link
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9-Apr-21 World View -- The Troubles: Violence in Northern Ireland revives as consequence of Brexit

Brief generational history of violence in the Isle of Ireland

by John J. Xenakis

This morning's key headlines from

The Troubles: Violence in Northern Ireland revives as consequence of Brexit

Hijacked cars burn at the Peace Wall as rioting broke out in West Belfast, Northern Ireland on Wednesday (AP)
Hijacked cars burn at the Peace Wall as rioting broke out in West Belfast, Northern Ireland on Wednesday (AP)

The last week in Belfast, Northern Ireland, has seen the worst ethnic street violence in decades. There is a concrete "Peace Wall" in Belfast, separating the two warring neighborhoods. People have been lobbing bricks and Molotov cocktails across the Peace Wall in both directions. The violence worsened when the gate in the Peace Wall was smashed open. At least 55 police officers have been injured over several nights of rioting.

The violence has been triggered by the consequences of the Brexit deal that took the United Kingdom (England, Wales, Scotland, Northern Ireland) out of the European Union. There were many difficult issues that had to be resolved, but the most intractable was the fact that Northern Ireland is part of the UK, while the Republic of Ireland (Southern Ireland) is part of the EU. This is the only place (if you don't count Gibraltar) where there is a land border separating the UK and the EU after Brexit.

So the biggest deal in the Brexit negotiations was that Ireland and Northern Ireland must have a "frictionless border," so that people and goods could pass freely back and forth without customs and border checks. So a Spanish company that wants to ship goods to England without paying British tariffs could simply trans-ship them through Northern Ireland -- that is, ship them to Ireland, send them across the "frictionless border" to Northern Ireland, and then ship them across the Irish Sea to England. Similarly, an English firm could ship goods to Spain by trans-shipping in the opposite direction, and avoid paying EU tariffs.

Well, that could never work. No politician is going to voluntarily give up tariffs. So the solution is that there has to be a "customs border in the Irish Sea." So goods shipped back and forth between England and Northern Ireland now have to go through customs and result in tariff charges.

During the Brexit negotiations, politicians said that if there were a customs check between Northern Ireland and Ireland, then this would infuriate the "Catholic republicans," and would trigger a revival of "The Troubles," the three decades violence in Northern Ireland. So they did it the other way, and put in a customs check in the Irish Sea, and this has infuriated the "Protestant loyalists," and this is triggering a revival of The Troubles anyway.

Brief generational history of violence in the Isle of Ireland

Northern Ireland's indigenous Gaelic Irish people (usually Catholic, republican, nationalist, "green") have been at war with the descendants of invading English and Scottish people (usually Protestant, loyalist, unionist, "orange") off and on since the 1400s. The Republicans want Northern Ireland to merge with the Republic of (Southern) Ireland, while the Loyalists want to remain loyal to the British crown and have Northern Ireland remain in the UK.

There have been clashes between the two groups since the 1400s, but the most important pattern of wars was set by the Nine Years War (1594-1603), where the Irish Gaelics attempted to overthrow English rule. The result was the Plantation of Ulster, which Gaelics today refer to as genocide and "ethnic cleansing," because the British drove the Gaelics from their land, took it over as landlords, and used the Gaelics as servants.

The next crisis war for Northern Ireland was the Williamite-Jacobite war, climaxing in a victory of the British with the Battle of the Boyne on July 12, 1690. This was the date of the victory of Protestant William of Orange over the Catholic King James II, and it followed England's Glorious Revolution of 1688, where the Dutch Prince William "invaded" England and overthrew King James without firing a shot. Sectarian violence in Northern Ireland tends to increase as July 12 approaches, as it's commemorated by groups like the Protestant Orange Institution.

The border across Ireland first appeared in 1921 as a result of the British-Irish treaty that partitioned the island and ended the Irish War of Independence, with the new borderline running across farms and villages.

The beginning of 'The Troubles'

"The Troubles" began in 1969, when hostilities broke out in Northern Ireland, and the border was reinforced with British Army watchtowers and bomb-proof and mortar-proof inspection facilities. All of those reinforcements were removed as a result of the 1998 Good Friday Agreement, with a new power-sharing accord that was supposed to break down some of the barriers between south and north, including the physical barrier at the border.

The "Good Friday Agreement" has achieved almost mythic status among politicians, and its terms were frequently cited during the Brexit negotiations as inviolable, lest The Troubles begin again. The result was the "frictionless border" between Ireland and Northern Ireland, but instead there's a customs border between Northern Ireland and England, and The Troubles seems to be starting again anyway.

There's a lot of finger-pointing now as to the cause of the new violence, with many people blaming Boris Johnson for his "betrayal" of the Northern Ireland loyalists. But from the point of view of Generational Dynamics, the revival of The Troubles is not surprising, inasmuch as a full generation has passed since the Good Friday agreement, and young kids are not going to care about a piece of paper or an ancient agreement that was signed before many of them were even born.


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2-Apr-21 World View -- Russia massing forces on Ukraine border, apparently planning imminent invasion

Russia fires back at reports of a potential invasion of Ukraine

by John J. Xenakis

This morning's key headlines from

Russia massing forces on Ukraine border, apparently planning imminent invasion

A trainload of tanks in southwestern Russia headed in the direction of the border with Ukraine earlier this week
A trainload of tanks in southwestern Russia headed in the direction of the border with Ukraine earlier this week

The US armed forces European Command has raised its threat watch assessement to its highest level -- "potential imminent crisis" -- because of growing reports of trains loaded with large amounts of Russian military hardware, including aircraft, tanks and other heavy armored vehicles, as well as heavy artillery and ground troops, headed toward the border with Ukraine.

In 2014, Russia troops invaded Ukraine in support of Russian separatists in eastern Ukraine. The purpose was to break off the entire eastern portion of Ukraine and annex it to the Russian Federation.

That didn't happen, but Russia also invaded Ukraine's Crimea peninsula and annexed it and made it part of the Russian federation. It's been assumed that Russia has wanted to complete the job of annexing eastern Ukraine, and there are concerns the Russians plan to do exactly that right now.

Russia may have decided to strike now because of the new Biden administration in Washington. Last Thursday press conference by Biden was undoubtedly analyzed closely by the Kremlin, and it was clear that Biden has no idea what's going on. In addition, the world can see that the Biden administration has completely lost control of its southern border. The Kremlin analysts may have decided that it would take a long time for the Biden administration to do anything, if the Biden administration did anything, and that therefore they can invade Ukraine with impunity. (See "28-Mar-21 World View -- North Korea's ballistic missiles stoke the Denuclearization Delusion".)

Russia fires back at reports of a potential invasion of Ukraine

Russia's mealy-mouthed spokesman Dmitry Peskov issued a statement saying that there's nothing to see here:

"Russian Federation is moving its troops within its territory, at its own discretion. Nobody should be concerned about it. It poses no threat to anyone."

At this point, it's worthwhile to make a list of previous Russian lies related to the 2014 Russian invasion of Ukraine:

According to US estimates, Russia has about 32,700 military personnel in Crimea, some 28,000 personnel in "separatist" units in areas of eastern Ukraine known collectively as the Donbass who have been fighting the government in Kiev since 2015.

A member of the Generational Dynamics forum, Navigator, an expert on military history, says:

"You do not move this kind of stuff [tanks and armored vehicles] around unless you mean to use it. Russia wants the traditional Ukraine back. This is up to the line of Odessa/Vinnetsa. They will probably allow Ukraine to remain in what was once the Austro-Hungarian province of Galicia, centered around the city of Lvov. Given Europe's current state, plus a weak US administration, they know they will be able to get away with this.

My bet is that Putin will go all in after Ukraine. After that he will take a breather to get ready for the Baltics. Going after the Baltics will require a NATO response. But my guess is that they will appear so weak due to an almost non-existent response to the Ukrainian campaign that the threat of this will not dissuade him. He could also have intel that the Chinese will be going after Taiwan at the same time he will be prepared to go into the Baltics. This is my guess."

So now more Russian troops ("volunteers?") are headed for the border with Ukraine, and Peskov says, "Nobody should be concerned about it."

However, the Pentagon is concerned about it, as evidenced by the rise in the threat watch assessement to its highest level -- "potential imminent crisis."

According to Pentagon spokesperson John Kirby: "We obviously don’t want to see any more violations of Ukrainian territory. We’ve been very clear about the threats that we see from Russia across domains ... we’re taking them very seriously."


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