Why The Healthcare Industry Doesn't Want Electronic Medical Records

Techdirt

...from the it-would-reveal-the-business-model dept


I've been really confused by the whole push for "electronic healthcare records" as some sort of big step for improving our healthcare system. It's such a minor part of what's needed that it seems to be looking at curing a cough when someone has terminal cancer. The cough isn't the issue. Also, it's never been quite clear why hospitals didn't move to electronic healthcare records in the first place. Lots of other businesses with tons of paper records long ago realized that moving to electronic records and making things more efficient wasn't just a fantastic way to make money, but a way to expand their own market. The switch from paper stock certificates to electronic ones didn't just save printing costs -- it enabled the stock market to change in a massive way (perhaps too much, many will note).
Andy Kessler, who's been thinking an awful lot about these issues (and whose book The End of Medicine hasn't received nearly the attention it deserves) has an interesting article discussing why the industry has resisted the move to e-healthcare records. While it would save some money, he notes, it would also expose the entire scam of the healthcare system: which is that they make a ton of money from inefficiencies baked into the system, which are totally hidden from view. It's a massive boondoggle for the industry, and e-healthcare records would actually make it easier for people to understand that the healthcare system profits from people being sick and not from having them be well.
The incentives are totally screwed up for everyone.
Healthcare providers make more money the sicker you are. Pharmaceutical companies make easy money with gov't monopolies limiting the ability to spread useful drugs. The actual costs are nearly totally hidden from most consumers, so they don't make smart choices at all. There's a lot of built in artificial scarcities in the system, and opening up the flow of information changes that.
Of course, in the grand scheme of things, this is dumb. Focusing on preventative care and actually keeping people healthy would actually provide a massive economic benefit not just to the healthcare industry, but to the economy as a whole. More healthy people contributing to production, output and consumption can do quite a lot for the economy. The numbers on some studies are staggering (we're talking trillions of dollars). If the incentives could be aligned such that people paid for staying healthy, rather than having illness treated, then there's a ton of money to be made without resorting to the old inefficient mess that is today's healthcare system.
But rather than tackle any of that, we get attempts to fix the cough in the terminally ill patient -- and the patient likes the morphine drip so much that he'll do anything to avoid getting healthy. It's time to fix the healthcare system. And while I don't necessarily believe that a small step like electronic medical records is all that meaningful, if Kessler is right and it actually drives some awareness to the underlying mess, perhaps it's at least a good start.

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Former PR Exec at Cigna: Health Care Industry vs. Health Reform

Center for Media and Democracy

I'm the former insurance industry insider now speaking out about how big for-profit insurers have hijacked our health care system and turned it into a giant ATM for Wall Street investors, and how the industry is using its massive wealth and influence to determine what is (and is not) included in the health care reform legislation members of Congress are now writing.
Although by most measures I had a great career in the insurance industry (four years at Humana and nearly 15 at CIGNA), in recent years I had grown increasingly uncomfortable serving as one of the industry's top PR executives. In addition to my responsibilities at CIGNA, which included serving as the company's chief spokesman to the media on all corporate and financial matters, I also served on a lot of trade association committees and industry-financed coalitions, many of which were essentially front groups for insurers. So I was in a unique position to see not only how Wall Street analysts and investors influence decisions insurance company executives make but also how the industry has carried out behind-the-scenes PR and lobbying campaigns to kill or weaken any health care reform efforts that threatened insurers' profitability.
I also have seen how the industry's practices -- especially those of the for-profit insurers that are under constant pressure from Wall Street to meet their profit expectations -- have contributed to the tragedy of nearly 50 million people being uninsured as well as to the growing number of Americans who, because insurers now require them to pay thousands of dollars out of their own pockets before their coverage kicks in -- are underinsured. An estimated 25 million of us now fall into that category.
What I saw happening over the past few years was a steady movement away from the concept of insurance and toward "individual responsibility," a term used a lot by insurers and their ideological allies. This is playing out as a continuous shifting of the financial burden of health care costs away from insurers and employers and onto the backs of individuals. As a result, more and more sick people are not going to the doctor or picking up their prescriptions because of costs. If they are unfortunate enough to become seriously ill or injured, many people enrolled in these plans find themselves on the hook for such high medical bills that they are losing their homes to foreclosure or being forced into bankruptcy.
As an industry spokesman, I was expected to put a positive spin on this trend that the industry created and euphemistically refers to as "consumerism" and to promote so-called "consumer-driven" health plans. I ultimately reached the point of feeling like a huckster.
I thought I could live with being a well-paid huckster and hang in there a few more years until I could retire. I probably would have if I hadn't made a completely spur-of-the-moment decision a couple of years ago that changed the direction of my life. While visiting my folks in northeast Tennessee where I grew up, I read in the local paper about a health "expedition" being held that weekend a few miles up U.S. 23 in Wise, Va. Doctors, nurses and other medical professionals were volunteering their time to provide free medical care to people who lived in the area. What intrigued me most was that Remote Area Medical, a non-profit group whose original mission was to provide free care to people in remote villages in South America, was organizing the expedition. I decided to check it out.
That 50-mile stretch of U.S. 23, which twists through the mountains where thousands of men have made their living working in the coalmines, turned out to be my "road to Damascus."
Nothing could have prepared me for what I saw when I reached the Wise County Fairgrounds, where the expedition was being held. Hundreds of people had camped out all night in the parking lot to be assured of seeing a doctor or dentist when the gates opened. By the time I got there, long lines of people stretched from every animal stall and tent where the volunteers were treating patients.
That scene was so visually and emotionally stunning it was all I could do to hold back tears. How could it be that citizens of the richest nation in the world were being treated this way?
A couple of weeks later I was boarding a corporate jet to fly from Philadelphia to a meeting in Connecticut. When the flight attendant served my lunch on gold-rimmed china and gave me a gold-plated knife and fork to eat it with, I realized for the first time that someone's insurance premiums were paying for me to travel in such luxury. I also realized that one of the reasons those people in Wise County had to wait in long lines to be treated in animal stalls was because our Wall Street-driven health care system has created one of the most inequitable health care systems on the planet.
Although I quit my job last year, I did not make a final decision to speak out as a former insider until recently when it became clear to me that the insurance industry and its allies (often including drug and medical device makers, business groups and even the American Medical Association) were succeeding in shaping the current debate on health care reform. While the thought of speaking out had crossed my mind during the months leading up to the day I gave notice, I initially decided instead to hang out my shingle as a consultant to small businesses and nonprofit organizations.
I decided to take the shingle down, though, at least for a while, when I heard members of Congress reciting talking points like the ones I used to write to scare people away from real reform. I'll have more to say about that over the coming weeks and months, but, for now, remember this: whenever you hear a politician or pundit use the term "government-run health care" and warn that the creation of a public health insurance option that would compete with private insurers (or heaven forbid, a single-payer system like the one Canada has) will "lead us down the path to socialism," know that the original source of the sound bite most likely was some flack like I used to be.
Bottom line: I ultimately decided the stakes are too high for me to just sit on the sidelines and let the special interests win again. So I have joined forces with thousands of other Americans who are trying to persuade our lawmakers to listen to us for a change, not just to the insurance and drug company executives who are spending millions to shape reform to benefit them and the Wall Street hedge fund managers they are beholden to.
Take it from me, a former insider, who knows what really motivates those folks. You need to know where the hard-earned money you pay in health insurance premiums -- if you lucky enough to have coverage at all -- really goes.
I decided to speak out knowing that some people will not like what I have to say and will do all they can to discredit me. In anticipation of that, here are some facts:
* I am not doing this because my former employer was pushing me out the door or because I had become a disgruntled employee. I had not been passed over for a promotion or anything like that. As I noted earlier, I had a financially rewarding career in the industry, and I'm very grateful for that. I had numerous promotions, raises, bonuses, stock options and stock grants over the years. When I left my last job, I was as close on the corporate ladder to the CEO as any PR person has ever climbed at the company. I reported to the general counsel, the company's top lawyer, whose boss is the chairman and CEO, a man I like and worked closely with over many years.
* The decision to leave was entirely my own, and I left on good terms with everybody at the company. In fact, I agreed to postpone my last day at work by more than two months at the company's request. My coworkers gave me a terrific going-away party, and I received dozens of kind notes from people all across the country including friends at other companies and at America's Health Insurance Plans, the industry trade association.
I still consider all of them my friends. In fact, the thing I have missed most since I left is working as part of a team, even though I eventually came to the conclusion that I was playing for the wrong side. Being a consultant has its advantages, but I have missed the camaraderie. After a few months, I thought that maybe I should consider working for another company again. At one point, a former boss told me that another insurer had posted a PR job and encouraged me to contact a former CIGNA executive who worked there about it. Against my better judgment, I did, but I immediately decided not to pursue it. The last thing I wanted to do was to go from one big insurer to another one. What the hell was I thinking?
I'm writing this because, knowing how things work, I'm fully expecting insurers' PR firms to quietly feed friends of the industry (which include a roster of editorial writers and pundits, lawmakers and many others who fall under the broad category of "third-party advocates,") with anything they can think of to discredit me and what I say. This will go on behind the scenes because the insurers will want to preserve the image they are working so hard to cultivate -- as a group of kind and caring folks who think only of you and your health and are working hard as real partners to Congress and the White House to find "a uniquely American solution" to what ails our system.
I expect this because I have worked closely with the industry's PR firms over many years whenever the insurers were being threatened with bad publicity, litigation or legislation that might hinder profits.
One of the reasons I chose to become affiliated with the Center for Media and Democracy is because of the important work the organization does to expose often devious, dishonest and unethical PR practices that further the self interests of big corporations and special interest groups at the expense of the American people and the democratic principles this country was founded on.
After a long career in PR, I am looking forward to providing an insider's perspective as a senior fellow at CMD, and I am very grateful for the opportunity to speak out for the rights and dignity of ordinary people. The people of Wise County and every county deserve much better than to be left behind to suffer or die ahead of their time due to Wall Street's efforts to keep our government from ensuring that all Americans have real access to first-class health care.
Wendell Potter is the Senior Fellow on Health Care for the Center for Media and Democracy in Madison, Wisconsin.

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Obama messes up on health care, big time

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Paul Krugman Blog - NYTimes.com

Really bad news on the health care front. After making the case for a public option, and doing it very well, Obama said this:
"We have not drawn lines in the sand other than that reform has to control costs and that it has to provide relief to people who don't have health insurance or are underinsured," Mr. Obama said. "Those are the broad parameters that we've discussed."
There he goes again, gratuitously making a big gift to the other side.
My big fear about Obama has always been not that he doesn't understand the issues, but that his urge to compromise -- his vision of himself as a politician who transcends the old partisan divisions -- will lead him to negotiate with himself, and give away far too much. He did that on the stimulus bill, where he offered an inadequate plan in order to win bipartisan support, then got nothing in return -- and was forced to reduce the plan further so that Susan Collins could claim her pound of flesh.
And now he's done it on a key component of health care reform. What was the point of signaling, right at this crucial moment, that he's willing to give away the public plan? Let alone doing it at the very moment that he was making such a good case for it?
Maybe there's a way to recover from this. But it's up to the health reform activists to stiffen the administration's spine. Obama may be satisfied with "broad parameters" -- but the rest of us aren't, and have to make that known.

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Health Care Showdown

The New York Times - PAUL KRUGMAN

America's political scene has changed immensely since the last time a Democratic president tried to reform health care. So has the health care picture: with costs soaring and insurance dwindling, nobody can now say with a straight face that the U.S. health care system is O.K. And if surveys like the New York Times/CBS News poll released last weekend are any indication, voters are ready for major change.
The question now is whether we will nonetheless fail to get that change, because a handful of Democratic senators are still determined to party like it's 1993.
And yes, I mean Democratic senators. The Republicans, with a few possible exceptions, have decided to do all they can to make the Obama administration a failure. Their role in the health care debate is purely that of spoilers who keep shouting the old slogans -- Government-run health care! Socialism! Europe! -- hoping that someone still cares.
The polls suggest that hardly anyone does. Voters, it seems, strongly favor a universal guarantee of coverage, and they mostly accept the idea that higher taxes may be needed to achieve that guarantee. What's more, they overwhelmingly favor precisely the feature of Democratic plans that Republicans denounce most fiercely as "socialized medicine" -- the creation of a public health insurance option that competes with private insurers.
Or to put it another way, in effect voters support the health care plan jointly released by three House committees last week, which relies on a combination of subsidies and regulation to achieve universal coverage, and introduces a public plan to compete with insurers and hold down costs.
Yet it remains all too possible that health care reform will fail, as it has so many times before.
I'm not that worried about the issue of costs. Yes, the Congressional Budget Office's preliminary cost estimates for Senate plans were higher than expected, and caused considerable consternation last week. But the fundamental fact is that we can afford universal health insurance -- even those high estimates were less than the $1.8 trillion cost of the Bush tax cuts. Furthermore, Democratic leaders know that they have to pass a health care bill for the sake of their own survival. One way or another, the numbers will be brought in line.
The real risk is that health care reform will be undermined by "centrist" Democratic senators who either prevent the passage of a bill or insist on watering down key elements of reform. I use scare quotes around "centrist," by the way, because if the center means the position held by most Americans, the self-proclaimed centrists are in fact way out in right field.
What the balking Democrats seem most determined to do is to kill the public option, either by eliminating it or by carrying out a bait-and-switch, replacing a true public option with something meaningless. For the record, neither regional health cooperatives nor state-level public plans, both of which have been proposed as alternatives, would have the financial stability and bargaining power needed to bring down health care costs.
Whatever may be motivating these Democrats, they don't seem able to explain their reasons in public.
Thus Senator Ben Nelson of Nebraska initially declared that the public option -- which, remember, has overwhelming popular support -- was a "deal-breaker." Why? Because he didn't think private insurers could compete: "At the end of the day, the public plan wins the day." Um, isn't the purpose of health care reform to protect American citizens, not insurance companies?
Mr. Nelson softened his stand after reform advocates began a public campaign targeting him for his position on the public option.
And Senator Kent Conrad of North Dakota offers a perfectly circular argument: we can't have the public option, because if we do, health care reform won't get the votes of senators like him. "In a 60-vote environment," he says (implicitly rejecting the idea, embraced by President Obama, of bypassing the filibuster if necessary), "you've got to attract some Republicans as well as holding virtually all the Democrats together, and that, I don't believe, is possible with a pure public option."
Honestly, I don't know what these Democrats are trying to achieve. Yes, some of the balking senators receive large campaign contributions from the medical-industrial complex -- but who in politics doesn't? If I had to guess, I'd say that what's really going on is that relatively conservative Democrats still cling to the old dream of becoming kingmakers, of recreating the bipartisan center that used to run America.
But this fantasy can't be allowed to stand in the way of giving America the health care reform it needs. This time, the alleged center must not hold.
Copyright 2009 The New York Times Company

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Chatham House Study Definitively Shows Massive Ballot Fraud in Iran's Reported Results

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Informed Comment

• In two Conservative provinces, Mazandaran and Yazd, a turnout of more than 100% was recorded.


• At a provincial level, there is no correlation between the increased turnout, and the swing to Ahmadinejad. This challenges the notion that his victory was due to the massive participation of a previously silent Conservative majority.


• In a third of all provinces, the official results would require that Ahmadinejad took not only all former conservative voters, and all former centrist voters, and all new voters, but also up to 44% of former Reformist voters, despite a decade of conflict between these two groups.


• In 2005, as in 2001 and 1997, conservative candidates, and Ahmadinejad in particular, were markedly unpopular in rural areas. That the countryside always votes conservative is a myth. The claim that this year Ahmadinejad swept the board in more rural provinces flies in the face of these trends.

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Day of Mourning, Protests, Called by Mousavi on Thursday

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Informed Comment

Mir-Hosain Mousavi, who maintains he won last Friday's presidential election despite official assertions that he lost 2 to 1 to Mahmoud Ahmadinejad, is calling for another rally Thursday, this time in part to honor the persons killed by hardliners or security forces in the course of previous demonstrations.

Mourning the martyr is as central to Iranian Shiite religious culture as it was to strains of medieval Catholicism in Europe, and Mousavi's camp is tapping into a powerful set of images and myths here. The archetypal Shiite martyr is Imam Husayn, the grandson of the Prophet Muhammad, who championed oppressed Muslims in Iraq and was cut down by the then Umayyad Muslim Empire. Recognition that a Muslim state might commit the ultimate in sacrilege by beheading a person who had been dangled on the Prophet's knee has imbued modern political Shiism with a distrust of the state. When Husayn's head was brought to the Umayyad caliph Yazid and deposited before his throne, older companions of the Prophet are said to have wept and remarked, "I saw the Prophet's lips on those cheeks." Shiites ritually march, flagellate, and chant in honor of the martyred Imam or divinely-appointed leader.

Today's protesters are wearing green, which symbolizes Mousavi's descent from the Prophet Muhammad. (Mousavi's family name refers to the Seventh Imam (descendant of the Prophet with claims to divine knowledge), Musa Kazim, whose tomb is in Kazimiya, north Baghdad. Sayyid families, those claiming descent from the Prophet, often take one of the Imams' names as a family name to honor them, though of course they are also claiming descent from the previous Imams right back to the Prophet.) The repertoires of protest the reformists are using echo those of the 1978-79 Islamic Revolution-- they are chanting "God is Great," mourning pious fallen martyrs, etc.-- another sign that this movement is not just alienated secularized elites.

But now Mousavi's his supporters are also sporting black ribbons to indicate that they are in mourning for the fallen. Typically, the dead will be commemorated again at one month and at 40 days. In 1978 such demonstrations for those killed in previous demonstrations grew in size all through the year, till they reached an alleged million in the streets of Tehran. Since the reformists are already claiming Monday's rally was a million, you wonder where things will go from here.

The regime's attempt to paint the protesters as nothing more than US intelligence agents underlines how wise President Obama has been not to insert himself forcefully into the situation in Iran. The reformers and the hard liners are not stable groupings. The core of each is competing for the allegiance of the general Iranian public. If the reformers can convince most Iranians of the justice of their cause, they will swing behind the opposition. If the hard liners can convince the public that the reformers are nothing more than cat's paws of a grasping, imperialist West-- i.e. that they are Ahmad Chalabis trying to bring Iran foreign occupation so as to get power themselves-- then the reformists will be crushed. Iranians value national independence above all, having suffered with a CIA-installed goverment for decades in the mid-twentieth century.

The prescriptions of John McCain and Faux Cable news for muscular US diplomacy at this point are tone deaf to Iranian realities and would backfire big time, harming both the reform cause and US interests. Anyway, after the basket case to which the US Republican Party reduced Iraq, no one in the global South is likely to want them meddling in their internal affairs.

Reports are streaming in of the arrest of over a hundred opposition figures and of hard line militia men following protesters home and breaking into their homes to terrorize them. See e.g., Basij paramilitary forces terrorize residential complex. The Basij militiamen are said to be afraid to come out in numbers during the opposition demonstrations, but sneak around at night to trail protesters and harass or arrest them.

Supreme Leader Ali Khamenei had met Tuesday morning with the representatives of all four presidential candidates, urging them to make up but continuing to insist that Ahmadinejad was the winner by 24 million to 14 million votes. He portrayed the massive post-election demonstrations and charges of ballot fraud as a minor tiff.

Gary Sick wonders if Khamenei really is the supreme leader any more, and hints that the hard line tack of stealing the election was directed by the Iranian Revolutionary Guard Corps, the country's religious national guard.

Reports are coming in from Iran that allege that the regime is tracking down and destroying satellite dishes, using helicopters for aerial surveillance of neighborhoods and Basij, the right wing militia (sort of like Mussolini's Black Shirts) to do the breaking and entering. Kindly neighbors who have tried to warn suspected satellite dish owners that the militiamen were coming have sometimes reportedly themselves been arrested.

SF Techie helps Iranian protests.

Iran elections: Regime cracks down on opposition as further unrest looms

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guardian.co.uk

Iran was braced for a fifth day of unrest today as the government intensified its crackdown on opposition figures with the arrest of dozens of leading critics and issued a further warning against reporting of the protest movement.
Saeed Laylaz, a leading journalist and a critic of government policy often quoted by foreign media, was among the latest to be detained, as protesters prepared for more demonstrations in Tehran.
"Iranian intelligence and security forces are using the public protests to engage in what appears to be a major purge of reform-oriented individuals whose situations in detention could be life-threatening," said Aaron Rhodes, a spokesman for the International Campaign for Human Rights in Iran.
There is also concern for the health of Saeed Hajarian, a former adviser to Mohammad Khatami and supporter of the opposition candidate Mir Hossein Mousavi, who was arrested yesterday. Hajarian, who was badly impaired in both mobility and speech in an assassination attempt nine years ago, needs constant medical attention and is unlikely to get it in the current circumstances.
Human rights groups said at least 100 people had been arrested in the city of Tabriz, a historic centre of protest and a Mousavi stronghold.
In a fresh challenge to the government, Mousavi urged supporters to stage peaceful protests or gather in mosques tomorrow to mourn those killed in the protests.
"A number of our countrymen were wounded or martyred," Mousavi said in a statement on his website.
"I ask the people to express their solidarity with the families ... by coming together in mosques or taking part in peaceful demonstrations."
Mousavi added that he would also take part in the day of mourning.
He also repeated his call for "a new presidential election that will not repeat the shameful fraud from the previous election".
In a sign of the divisions in Iran's leadership, the interior ministry ordered an investigation into an attack on university students which they say was carried out by militia and police. It came a day after Iran's influential speaker of parliament, Ali Larijani, condemned the assault on the dormitory of Tehran University.
There were, however, further signs of a crackdown today as the powerful Revolutionary Guards warned Iranian websites and blogs to remove content that might "create tension" or face legal action, according to the Associated Press.
Much information about the protests has come from blogs and websites such as YouTube, Facebook and Twitter. The government yesterday barred foreign media from leaving their offices to report on the demonstrations, and reporters' visas have not been renewed.
Amid fears that tension might lead to further bloodshed, Gordon Brown today urged Iran to listen to its people. "The elections are a matter for the Iranian people, but if there are serious questions that are now being asked about the conduct of the elections, they have got to be answered," he said. "There must be no violence in response to peaceful protests."
Iran's foreign ministry summoned the British ambassador and his European counterparts to criticise their "interventionist and impudent" responses to the disputed election.
Meanwhile, the prosecutor general of the central province of Isfahan warned that those behind post-election unrest could face the death penalty under Islamic law. Mohammadreza Habibi alleged that anti-government protesters were being controlled from outside Iran and urged them to stop what he described as "criminal activities", the Fars news agency reported.
There were also unconfirmed reports that Mohammad Asgari, who was responsible for the security of the IT network in Iran's interior ministry, was killed yesterday in a suspicious car accident in Tehran. Asgari had reportedly leaked evidence that the elections were rigged to alter the votes from the provinces. Asgari was said to have leaked information that showed Mousavi had won almost 19m votes, and should therefore be president.
Iran's supreme leader, Ayatollah Ali Khamenei, last night appeared to rule out any change to the outcome of last week's disputed poll by referring to Mahmoud Ahmadinejad as the "elected president".
Khamenei last night dismissed the protests as the work of "tension seekers". Khamenei's appeal for calm after four days of protests in Tehran followed an apparent concession when the regime promised to recount some votes cast in Friday's disputed election, officially won by Ahmadinejad. But the authorities rejected demands by the defeated Mousavi to annul the election.
© Guardian News and Media Limited 2009

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De-Dollarization: Dismantling America's Financial-Military Empire

Image via Wikipedia

Globalresearch.ca

The city of Yakaterinburg, Russia's largest east of the Urals, may become known not only as the death place of the tsars but of American hegemony too - and not only where US U-2 pilot Gary Powers was shot down in 1960, but where the US-centered international financial order was brought to ground.
Challenging America will be the prime focus of extended meetings in Yekaterinburg, Russia (formerly Sverdlovsk) today and tomorrow (June 15-16) for Chinese President Hu Jintao, Russian President Dmitry Medvedev and other top officials of the six-nation Shanghai Cooperation Organization (SCO). The alliance is comprised of Russia, China, Kazakhstan, Tajikistan, Kyrghyzstan and Uzbekistan, with observer status for Iran, India, Pakistan and Mongolia. It will be joined on Tuesday by Brazil for trade discussions among the BRIC nations (Brazil, Russia, India and China).
The attendees have assured American diplomats that dismantling the US financial and military empire is not their aim. They simply want to discuss mutual aid - but in a way that has no role for the United States, NATO or the US dollar as a vehicle for trade. US diplomats may well ask what this really means, if not a move to make US hegemony obsolete. That is what a multipolar world means, after all. For starters, in 2005 the SCO asked Washington to set a timeline to withdraw from its military bases in Central Asia. Two years later the SCO countries formally aligned themselves with the former CIS republics belonging to the Collective Security Treaty Organization (CSTO), established in 2002 as a counterweight to NATO.
Yet the meeting has elicited only a collective yawn from the US and even European press despite its agenda is to replace the global dollar standard with a new financial and military defense system. A Council on Foreign Relations spokesman has said he hardly can imagine that Russia and China can overcome their geopolitical rivalry,1 suggesting that America can use the divide-and-conquer that Britain used so deftly for many centuries in fragmenting foreign opposition to its own empire. But George W. Bush ("I'm a uniter, not a divider") built on the Clinton administration's legacy in driving Russia, China and their neighbors to find a common ground when it comes to finding an alternative to the dollar and hence to the US ability to run balance-of-payments deficits ad infinitum.
What may prove to be the last rites of American hegemony began already in April at the G-20 conference, and became even more explicit at the St. Petersburg International Economic Forum on June 5, when Mr. Medvedev called for China, Russia and India to "build an increasingly multipolar world order." What this means in plain English is: We have reached our limit in subsidizing the United States' military encirclement of Eurasia while also allowing the US to appropriate our exports, companies, stocks and real estate in exchange for paper money of questionable worth.
"The artificially maintained unipolar system," Mr. Medvedev spelled out, is based on "one big centre of consumption, financed by a growing deficit, and thus growing debts, one formerly strong reserve currency, and one dominant system of assessing assets and risks."2 At the root of the global financial crisis, he concluded, is that the United States makes too little and spends too much. Especially upsetting is its military spending, such as the stepped-up US military aid to Georgia announced just last week, the NATO missile shield in Eastern Europe and the US buildup in the oil-rich Middle East and Central Asia.
The sticking point with all these countries is the US ability to print unlimited amounts of dollars. Overspending by US consumers on imports in excess of exports, US buy-outs of foreign companies and real estate, and the dollars that the Pentagon spends abroad all end up in foreign central banks. These agencies then face a hard choice: either to recycle these dollars back to the United States by purchasing US Treasury bills, or to let the "free market" force up their currency relative to the dollar - thereby pricing their exports out of world markets and hence creating domestic unemployment and business insolvency.
When China and other countries recycle their dollar inflows by buying US Treasury bills to "invest" in the United States, this buildup is not really voluntary. It does not reflect faith in the U.S. economy enriching foreign central banks for their savings, or any calculated investment preference, but simply a lack of alternatives. "Free markets" US-style hook countries into a system that forces them to accept dollars without limit. Now they want out.
This means creating a new alternative. Rather than making merely "cosmetic changes as some countries and perhaps the international financial organisations themselves might want," Mr. Medvedev ended his St. Petersburg speech, "what we need are financial institutions of a completely new type, where particular political issues and motives, and particular countries will not dominate."
When foreign military spending forced the US balance of payments into deficit and drove the United States off gold in 1971, central banks were left without the traditional asset used to settle payments imbalances. The alternative by default was to invest their subsequent payments inflows in US Treasury bonds, as if these still were "as good as gold." Central banks now hold $4 trillion of these bonds in their international reserves - land these loans have financed most of the US Government's domestic budget deficits for over three decades now! Given the fact that about half of US Government discretionary spending is for military operations - including more than 750 foreign military bases and increasingly expensive operations in the oil-producing and transporting countries - the international financial system is organized in a way that finances the Pentagon, along with US buyouts of foreign assets expected to yield much more than the Treasury bonds that foreign central banks hold.
The main political issue confronting the world's central banks is therefore how to avoid adding yet more dollars to their reserves and thereby financing yet further US deficit spending - including military spending on their borders?
For starters, the six SCO countries and BRIC countries intend to trade in their own currencies so as to get the benefit of mutual credit that the United States until now has monopolized for itself. Toward this end, China has struck bilateral deals with Argentina and Brazil to denominate their trade in renminbi rather than the dollar, sterling or euros,3 and two weeks ago China reached an agreement with Malaysia to denominate trade between the two countries in renminbi.[4] Former Prime Minister Tun Dr. Mahathir Mohamad explained to me in January that as a Muslim country, Malaysia wants to avoid doing anything that would facilitate US military action against Islamic countries, including Palestine. The nation has too many dollar assets as it is, his colleagues explained. Central bank governor Zhou Xiaochuan of the People's Bank of China wrote an official statement on its website that the goal is now to create a reserve currency "that is disconnected from individual nations."5 This is the aim of the discussions in Yekaterinburg.
In addition to avoiding financing the US buyout of their own industry and the US military encirclement of the globe, China, Russia and other countries no doubt would like to get the same kind of free ride that America has been getting. As matters stand, they see the United States as a lawless nation, financially as well as militarily. How else to characterize a nation that holds out a set of laws for others - on war, debt repayment and treatment of prisoners - but ignores them itself? The United States is now the world's largest debtor yet has avoided the pain of "structural adjustments" imposed on other debtor economies. US interest-rate and tax reductions in the face of exploding trade and budget deficits are seen as the height of hypocrisy in view of the austerity programs that Washington forces on other countries via the IMF and other Washington vehicles.
The United States tells debtor economies to sell off their public utilities and natural resources, raise their interest rates and increase taxes while gutting their social safety nets to squeeze out money to pay creditors. And at home, Congress blocked China's CNOOK from buying Unocal on grounds of national security, much as it blocked Dubai from buying US ports and other sovereign wealth funds from buying into key infrastructure. Foreigners are invited to emulate the Japanese purchase of white elephant trophies such as Rockefeller Center, on which investors quickly lost a billion dollars and ended up walking away.
In this respect the US has not really given China and other payments-surplus nations much alternative but to find a way to avoid further dollar buildups. To date, China's attempts to diversify its dollar holdings beyond Treasury bonds have not proved very successful. For starters, Hank Paulson of Goldman Sachs steered its central bank into higher-yielding Fannie Mae and Freddie Mac securities, explaining that these were de facto public obligations. They collapsed in 2008, but at least the US Government took these two mortgage-lending agencies over, formally adding their $5.2 trillion in obligations onto the national debt. In fact, it was largely foreign official investment that prompted the bailout. Imposing a loss for foreign official agencies would have broken the Treasury-bill standard then and there, not only by utterly destroying US credibility but because there simply are too few Government bonds to absorb the dollars being flooded into the world economy by the soaring US balance-of-payments deficits.
Seeking more of an equity position to protect the value of their dollar holdings as the Federal Reserve's credit bubble drove interest rates down China's sovereign wealth funds sought to diversify in late 2007. China bought stakes in the well-connected Blackstone equity fund and Morgan Stanley on Wall Street, Barclays in Britain South Africa's Standard Bank (once affiliated with Chase Manhattan back in the apartheid 1960s) and in the soon-to-collapse Belgian financial conglomerate Fortis. But the US financial sector was collapsing under the weight of its debt pyramiding, and prices for shares plunged for banks and investment firms across the globe.
Foreigners see the IMF, World Bank and World Trade Organization as Washington surrogates in a financial system backed by American military bases and aircraft carriers encircling the globe. But this military domination is a vestige of an American empire no longer able to rule by economic strength. US military power is muscle-bound, based more on atomic weaponry and long-distance air strikes than on ground operations, which have become too politically unpopular to mount on any large scale.
On the economic front there is no foreseeable way in which the United States can work off the $4 trillion it owes foreign governments, their central banks and the sovereign wealth funds set up to dispose of the global dollar glut. America has become a deadbeat - and indeed, a militarily aggressive one as it seeks to hold onto the unique power it once earned by economic means. The problem is how to constrain its behavior. Yu Yongding, a former Chinese central bank advisor now with China's Academy of Sciences, suggested that US Treasury Secretary Tim Geithner be advised that the United States should "save" first and foremost by cutting back its military budget. "U.S. tax revenue is not likely to increase in the short term because of low economic growth, inflexible expenditures and the cost of 'fighting two wars.'"6
At present it is foreign savings, not those of Americans that are financing the US budget deficit by buying most Treasury bonds. The effect is taxation without representation for foreign voters as to how the US Government uses their forced savings. It therefore is necessary for financial diplomats to broaden the scope of their policy-making beyond the private-sector marketplace. Exchange rates are determined by many factors besides "consumers wielding credit cards," the usual euphemism that the US media cite for America's balance-of-payments deficit. Since the 13th century, war has been a dominating factor in the balance of payments of leading nations - and of their national debts. Government bond financing consists mainly of war debts, as normal peacetime budgets tend to be balanced. This links the war budget directly to the balance of payments and exchange rates.
Foreign nations see themselves stuck with unpayable IOUs - under conditions where, if they move to stop the US free lunch, the dollar will plunge and their dollar holdings will fall in value relative to their own domestic currencies and other currencies. If China's currency rises by 10% against the dollar, its central bank will show the equivalent of a $200 million loss on its $2 trillion of dollar holdings as denominated in yuan. This explains why, when bond ratings agencies talk of the US Treasury securities losing their AAA rating, they don't mean that the government cannot simply print the paper dollars to "make good" on these bonds. They mean that dollars will depreciate in international value. And that is just what is now occurring. When Mr. Geithner put on his serious face and told an audience at Peking University in early June that he believed in a "strong dollar" and China's US investments therefore were safe and sound, he was greeted with derisive laughter.7
Anticipation of a rise in China's exchange rate provides an incentive for speculators to seek to borrow in dollars to buy renminbi and benefit from the appreciation. For China, the problem is that this speculative inflow would become a self-fulfilling prophecy by forcing up its currency. So the problem of international reserves is inherently linked to that of capital controls. Why should China see its profitable companies sold for yet more freely-created US dollars, which the central bank must use to buy low-yielding US Treasury bills or lose yet further money on Wall Street?
To avoid this quandary it is necessary to reverse the philosophy of open capital markets that the world has held ever since Bretton Woods in 1944. On the occasion of Mr. Geithner's visit to China, "Zhou Xiaochuan, minister of the Peoples Bank of China, the country's central bank, said pointedly that this was the first time since the semiannual talks began in 2006 that China needed to learn from American mistakes as well as its successes" when it came to deregulating capital markets and dismantling controls.8
An era therefore is coming to an end. In the face of continued US overspending, de-dollarization threatens to force countries to return to the kind of dual exchange rates common between World Wars I and II: one exchange rate for commodity trade, another for capital movements and investments, at least from dollar-area economies.
Even without capital controls, the nations meeting at Yekaterinburg are taking steps to avoid being the unwilling recipients of yet more dollars. Seeing that US global hegemony cannot continue without spending power that they themselves supply, governments are attempting to hasten what Chalmers Johnson has called "the sorrows of empire" in his book by that name - the bankruptcy of the US financial-military world order. If China, Russia and their non-aligned allies have their way, the United States will no longer live off the savings of others (in the form of its own recycled dollars) nor have the money for unlimited military expenditures and adventures.
US officials wanted to attend the Yekaterinburg meeting as observers. They were told No. It is a word that Americans will hear much more in the future.
Notes

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Iran's Ex-Foreign Minister Yazdi: It's A Coup

Image via Wikipedia

The Dreyfuss Report

It's Saturday afternoon in Tehran, and the streets are generally quiet. But the aftermath of Iran's rigged election, in which radical-right President Ahmadinejad and his paramilitary backers were kept in office, has left Iran's capital steeped in anger, despair, and bitterness.
Last night, after the polls closed, heavily armed troops from the Iranian Revolutionary Guard Corps were in evidence in the streets. In one area of north Tehran, where backers of opposition challenger and reformist ex-Prime Minister Mousavi are concentrated, I saw a convoy of at least fifteen military vehicles filled with armed guards idling along the side of the road. The street in front of the Interior Ministry, where votes are counted, is blocked and heavily guarded after rumors that Mousavi supporters might gather there to protest the election count.
Mousavi himself has pledged to fight the verdict, using words like "tyranny" and adding, "I will not surrender to this dangerous charade."
To get some perspective on the crisis, today I went to see Ibrahim Yazdi, a leading Iranian dissident and Iran's foreign minister in the early days of Islamic republic. Here is the text of the interview:
What is your reaction to the results of the election?
Many of us believe that the election was rigged. Not only Mousavi. We don't have any doubt. And as far as we are concerned, it is not legitimate.
There were many, many irregularities. They did not permit the candidates to supervise the election or the counting of the ballots at the polling places. The minister of the interior announced that he would oversee the final count in his office, at the ministry, with only two aides present.
In previous elections, they announced the results in each district, so people could follow up and make a judgment about the validity of the figures. In 2005, there were problems: in one district there were about 100,000 eligible voters, and they announced a total vote of 150,000. This time they didn't even release information about each particular district.
In all, there were about 45,000 polling places. There were 14,000 mobile ones, that can move from place to place. Many of us protested that. Originally, these mobile polling places were supposed to be used in hospitals and so on. This time, they were used in police stations, army bases, and various military compounds. When it comes to the military compounds and so on, if even 500 extra votes were put into each of the 14,000 boxes, that is seven million votes.
Mousavi and Karroubi had earlier established a joint committee to protect the peoples' votes. Many young people volunteered to work on that committee. But the authorities didn't let it happen. Last night [that is, election night] the security forces closed down that committee. There is no way, independent of the government and the Guardian Council, to verify the results.
I've heard people say that President Ahmadinejad is gathering so much power that he might be able to use the Revolutionary Guard and his other allies to make a coup d'etat against the state.
A coup d'etat? They've already made one! They've created a dictatorship, in fact. Do you know that last night the security forces occupied the offices of many newspapers, to make sure that their reporting on the election was favorable? They changed many headlines. They fixed the election.
The Guards are taking over everything, including many economic institutions. The ministry of the interior is increasing its control in all the provinces.
We have information that Ahmadinejad is thinking about changing the Constitution to allow the president to serve more than two terms, to make his presidency more or less permanent.
Of course, there are strong voices in the establishment that will challenge him. It is not clear that he and the Sepah (the Revolutionary Guard) will be strong enough to overcome them. But there will be clashes over this.
Where does the Leader, Ayatollah Ali Khamenei, stand in regard to this?
The problem is that there is concern about the relationship between the Leader and the Guards. To what extent can the Leader control or moderate the Guards? This is a difficult question.
After the last election [2005], after Ahmadinejad was first elected, there were many questions raised about Ahmadinejad's effort to isolate the Leader. We talked openly about this. This time, in preparation for the vote, they isolated him even further. For instance, in years past [former President] Ali Akbar Hashemi-Rafsanjani was influential, perhaps even more influential than the leader. Now, with the slogans being used at Ahmadinejad's rallies, things like "Death to Hashemi!", they have created a deep rift. Khamenei has also lost the support of many high-ranking members of the clergy.
Many old comrades of the [1979] revolution don't trust Ahmadinejad. It is only the Sepah that supports him.
And what do you mean by "isolating" the Leader?
By monitoring and controlling the flow of information to him. Unfortunately, God will not reveal information to him directly. Where does he get his information, his data? The system works in such a way that information is very powerful. And Ahmadinejad controls the ministry of the interior, the ministry of information, the ministry of intelligence.
What do you think will happen now? So much energy was devoted to support for Mousavi, and so much hope was created. Do you think it will result in a crisis?
Certainly, we are concerned about spontaneous reactions. Iran's youth has been engaged and mobilized. Around the country, there have already been some violent clashes.
We do not agree with violence, because violence will only give the Right an excuse to suppress the opposition.
Certainly, the gap inside Iran, politically, will be widened. Our main concern is how to keep the enthusiasm that was created for the election alive, in order to monitor and constrain the power of the government. The only way to counter it is the power of the people. We need to organize them.
In this we have an experience to guide us. During the era of the Shah, there was only one moment in which the power of the people was mobilized against the Shah and to support changes in the Constitution, and that was during the era of [Prime Minister] Mossadegh. [Mossadegh was ousted in the 1953 coup organized by the CIA and British intelligence.] In that era, there was a very powerful political movement inside the country that checked the power of the Shah. Today we have to do the same. We are nor after subversion. We do not want to change the Constitution. We do want to create a viable political force that can exert its influence.

Stealing the Iranian Election

Image by youngrobv (Rob & Ale) via Flickr

Informed Comment

Top Pieces of Evidence that the Iranian Presidential Election Was Stolen

1. It is claimed that Ahmadinejad won the city of Tabriz with 57%. His main opponent, Mir Hossein Mousavi, is an Azeri from Azerbaijan province, of which Tabriz is the capital. Mousavi, according to such polls as exist in Iran and widespread anecdotal evidence, did better in cities and is popular in Azerbaijan. Certainly, his rallies there were very well attended. So for an Azeri urban center to go so heavily for Ahmadinejad just makes no sense. In past elections, Azeris voted disproportionately for even minor presidential candidates who hailed from that province.

2. Ahmadinejad is claimed to have taken Tehran by over 50%. Again, he is not popular in the cities, even, as he claims, in the poor neighborhoods, in part because his policies have produced high inflation and high unemployment. That he should have won Tehran is so unlikely as to raise real questions about these numbers.

3. It is claimed that cleric Mehdi Karoubi, the other reformist candidate, received 320,000 votes, and that he did poorly in Iran's western provinces, even losing in Luristan. He is a Lur and is popular in the west, including in Kurdistan. Karoubi received 17 percent of the vote in the first round of presidential elections in 2005. While it is possible that his support has substantially declined since then, it is hard to believe that he would get less than one percent of the vote. Moreover, he should have at least done well in the west, which he did not.

4. Mohsen Rezaie, who polled very badly and seems not to have been at all popular, is alleged to have received 670,000 votes, twice as much as Karoubi.

5. Ahmadinejad's numbers were fairly standard across Iran's provinces. In past elections there have been substantial ethnic and provincial variations.

6. The Electoral Commission is supposed to wait three days before certifying the results of the election, at which point they are to inform Khamenei of the results, and he signs off on the process. The three-day delay is intended to allow charges of irregularities to be adjudicated. In this case, Khamenei immediately approved the alleged results.

I am aware of the difficulties of catching history on the run. Some explanation may emerge for Ahmadinejad's upset that does not involve fraud. For instance, it is possible that he has gotten the credit for spreading around a lot of oil money in the form of favors to his constituencies, but somehow managed to escape the blame for the resultant high inflation.

But just as a first reaction, this post-election situation looks to me like a crime scene. And here is how I would reconstruct the crime.

As the real numbers started coming into the Interior Ministry late on Friday, it became clear that Mousavi was winning. Mousavi's spokesman abroad, filmmaker Mohsen Makhbalbaf, alleges that the ministry even contacted Mousavi's camp and said it would begin preparing the population for this victory.

The ministry must have informed Supreme Leader Ali Khamenei, who has had a feud with Mousavi for over 30 years, who found this outcome unsupportable. And, apparently, he and other top leaders had been so confident of an Ahmadinejad win that they had made no contingency plans for what to do if he looked as though he would lose.

They therefore sent blanket instructions to the Electoral Commission to falsify the vote counts.

This clumsy cover-up then produced the incredible result of an Ahmadinejad landlside in Tabriz and Isfahan and Tehran.

The reason for which Rezaie and Karoubi had to be assigned such implausibly low totals was to make sure Ahmadinejad got over 51% of the vote and thus avoid a run-off between him and Mousavi next Friday, which would have given the Mousavi camp a chance to attempt to rally the public and forestall further tampering with the election.

This scenario accounts for all known anomalies and is consistent with what we know of the major players.

More in my column, just out, in Salon.com: "Ahmadinejad reelected under cloud of fraud," where I argue that the outcome of the presidential elections does not and should not affect Obama's policies toward that country-- they are the right policies and should be followed through on regardless.

The public demonstrations against the result don't appear to be that big. In the past decade, reformers have always backed down in Iran when challenged by hardliners, in part because no one wants to relive the horrible Great Terror of the 1980s after the revolution, when faction-fighting produced blood in the streets. Mousavi is still from that generation.

My own guess is that you have to get a leadership born after the revolution, who does not remember it and its sanguinary aftermath, before you get people willing to push back hard against the rightwingers.

So, there are protests against an allegedly stolen election. The Basij paramilitary thugs and the Iranian Revolutionary Guards will break some heads. Unless there has been a sea change in Iran, the theocrats may well get away with this soft coup for the moment. But the regime's legitimacy will take a critical hit, and its ultimate demise may have been hastened, over the next decade or two.

What I've said is full of speculation and informed guesses. I'd be glad to be proved wrong on several of these points. Maybe I will be.

PS: Here's the data:

So here is what Interior Minister Sadeq Mahsouli said Saturday about the outcome of the Iranian presidential elections:

"Of 39,165,191 votes counted (85 percent), Mahmoud Ahmadinejad won the election with 24,527,516 (62.63 percent)."

He announced that Mir-Hossein Mousavi came in second with 13,216,411 votes (33.75 percent).

Mohsen Rezaei got 678,240 votes (1.73 percent)

Mehdi Karroubi with 333,635 votes (0.85 percent).

He put the void ballots at 409,389 (1.04 percent).

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Iran Guard warns reformist groups

Image by Getty Images via Daylife

Informed Comment has more on Iran's election.
Al Jazeera English

The political chief of Iran's Revolutionary Guard has warned reformists in the country against seeking what he called a "velvet revolution", vowing that it would be "nipped in the bud".
Yadollah Javani's comments appeared aimed at Mir Hossein Mousavi, a reformist candidate in the country's presidential elections and followed another day of bitter exchanges between Mousavi and his rival and current president, Mahmoud Ahmadinejad.
The Revolutionary Guard is one of the pillars of the Iranian establishment and controls large military forces as well as a nationwide network of militia.
In a statement on its website, Javani drew parallels between Mousavi's campaign and the "velvet revolution'' that led to the 1989 overthrow of the communist government in then Czechoslovakia.
"There are many indications that some extremist [reformist] groups, have designed a colourful revolution ... using a specific colour for the first time in an election," the statement said.
Candidates court youth
Calling that a "sign of kicking off a velvet revolution project in the presidential elections", Javani vowed that any "attempt for velvet revolution will be nipped in the bud".
Javani also accused the reformists of planning to claim vote rigging and provoke street violence if Mousavi loses.
Ahmadinejad, the president, is believed to have wide support in the Revolutionary Guard and among Iran's ruling clerics, though neither have given public endorsements in the presidential race.
Speaking to Al Jazeera, Sadegh Zibakalam, professor of political science at Tehran University, said that the Revolutionary Guard chief's statement would not change the course of the election.
"Over the last three weeks, hundreds, thousands - perhaps millions - of Iranians have been pouring onto the streets. More than supporting Mousavi or other candidates, they have been expressing their opposition to Ahmadinejad and his policies," he said.
"I do not think the Revolutionary Guard's interference will change anything because it is not as though there is a conspiracy that requires them to step in."
Trading barbs
In the final hours of campaigning before the election on Friday, candidates traded bitter accusations.
Ahmadinejad accused his rivals of using Hitler-style smear tactics and said they could face jail for insulting the president.
"Such insults and accusations against the government are a return to Hitler's methods, to repeat lies and accusations ... until everyone believes those lies," the semi-official Fars news agency quoted Ahmadinejad as saying.
Insulting senior officials is a crime in Iran punishable by a maximum of two years in prison.
Mousavi, a reformist and former prime minister, accused Ahmadinejad of isolating Iran with his vitriolic attacks on the US and said he lied about the country's economy.
All campaigning was banned from Thursday morning and cars plastered with pictures and campaign material would be stopped and seized, state television reported.
But even after the official end of campaigning, tens of thousands of Mousavi supporters remained in the streets, dancing on cars, waving green flags and passing out pro-Mousavi fliers.
'Unpredictable' election
Mahdi Karroubi, a reformist and former parliamentary speaker, and Mohsen Rezai, a former commander of the Revolutionary Guard, are also standing in Friday's election.
The Iranian election
The four candidates for the presidency were cleared by Iran's Guardian Council, a panel of six senior clerics and six Islamic jurists
The council, which disqualified the rest of the 475 potential candidates who registered, bars women from standing
All Iranians aged over 18 can vote, which means 46 million of Iran's more than 70 million people are eligible
If no candidate wins at least 50 per cent plus one vote of all ballots cast, including blank ones, a run-off round between the two leading candidates will be held on the first Friday after the election result is declared
Al Jazeera's Alireza Ronaghi, reporting from Tehran, said this was the most unpredictable and most exciting Iranian presidential election in years because the main contenders each had strong support.
It was clear that Mousavi had a slight edge over Ahmadinejad in the capital, Tehran, but in other provinces it was a totally different story, our correspondent added.
Trita Parsi, the president of the Iranian-American Council, told Al Jazeera that Ahmadinejad's attacks on Mousavi "seems to have backfired and may have motivated the youth to come out and vote, supporting Mousavi's platform of change".
Afshin Molavi of the New America Foundation told Al Jazeera that accusations against Ahmadinejad and the ruling elites of corruption and fat cat insider dealings "will continue to hang in the air long after these elections, and many Iranians know this about the ruling elites".
He said that while Iran has traditionally had high voter turnout, "when we're seeing so many voters than previous polls, it tends to reflect a switch to reformist candidates".
Iran's reformists are hoping that a high turnout on Friday will help them oust the conservative Ahmadinejad, whom they accuse of increasing the country's international isolation and compounding its economic difficulties.
Mousavi's campaign appears to have motivated the youth in a country where one-third of the electorate is under 30 and born after the time of the Islamic Revolution in 1979.
"I believe it is a new beginning and I want to take part in it," Parastou Pazhoutan, a 26-year-old Mousavi supporter, said.
"A month ago, I would have said Ahmadinejad was a sure bet,'' Sharif Emam Jomeh, a political analyst, said.
"There was apathy especially with the youth. But now, until 3am, they are out in numbers and they care ... Below the surface, something was boiling."

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Iran's Green Wave: Ahmadinejad's Undoing?

The Dreyfuss Report

There's electricity in the air in Tehran. Beneath the snow-capped peaks that tower over the city, crowds gather every night to argue in the streets. Campaign posters touting candidate in the June 12 vote cover the city. A year ago, when I visited Tehran in advance of the parliamentary elections, there was apathy. Voters then were convinced that their votes didn't matter, and that not voting was the best way to protest the current state of affairs. No longer. There's a wave building, and all signs point to a resounding victory for Mir Hossein Mousavi, the pro-reform candidate who is challenging President Ahmadinejad.
That wave is green. All over the capital, there are green signs and banners supporting Mousavi. Cars flying green flags speed through the city, honking horns for Mousavi. For years, the hardline clergy and their allies, including Ahmadinejad, have feared nothing more than an Iranian-style "color-revolution." Now, Mousavi--with solid establishment credentials, an Islamic revolutionary pedigree second to none, and an outspoken pro-reform message--finds himself at the head of a green parade.
Of course, the hardliners and Ahmadinejad have a lot of aces up their sleeve, including the security services, the judiciary, the Revolutionary Guard, and the interior ministry, which counts the votes.
On Saturday, my first day in Tehran, I traveled some 25 miles outside the capital to Karaj, a city of three million people, for a rally for Mousavi at a huge soccer stadium. The scene was frenzied with excitement. At least 20,000 people waving green flags and dressed in green scarves packed the place. They did the wave. The cheers were deafening, and Mousavi hadn't even arrived yet. In the VIP section, I ran into an Iranian Olympic wrestling champion, Ebrahim Javadi, who'd come to show his support. "I am sure Mr. Mousavi can help us survive this crisis," he said. And better relations with the United States. "One hundred percent!" he said. Nearby, a middle-aged mullah, dressed in brown robes and white turban, said he'd watched President Obama's speech. Akbar Hamidi, 48, is a specialist in Persian literature. "Please take our message of peace to America," he told me. "I hope we elect Mousavi so he can start negotiations with the United States."
When Mousavi entered, the frenzy hit new highs. A roar went up. People chanted: "If there is no election cheating, you are Number One!" and "Ahmadinejad, shame on you! Let's get rid of you!"
And then: the power went out. Mousavi could not speak. He waved to the vast crowd, and they waved back. After half an hour, he waved goodbye. Rumors flew that someone--the most often mentioned culprit was the Basij, the paramilitary force that supports Ahmadinejad--had sabotaged the rally. Just another day of politics in Iran. The next day, another Mousavai rally was canceled at a stadium north of Tehran when the stadium management informed Mousavi staff that the rally would damage the playing field in advance of a match next week."Just an excuse," said an Iranian observer.
Later that night, more than 300 Iranian artists--painters, sculptors and others--convened an extraordinary gathering in support of Mousavi, whose outspoken wife is also an artist and who, in a step unprecedented in Iran, campaigns side by side with him, even holding hands. Hundreds of people gathered at the Gallery Mellat, and in an auditorium they listened to a speech by former President Khatami, the reformist, who is supporting Mousavi. "The government," said Khatami, "has turned being anti-art into an art form." Mousavi, who was prime minister from 1981-1989, had garnered across-the-board support from Iran's intellectual community, including writers, artists, musicians, actors, and others. At the event I spoke to many world famous Iranian artists, each of whom said that each and every work they produce must be cleared by the Ministry of Culture and Islamic Guidance. And there was enormous buzz about Obama's opening to Iran. "People hope we can find a new way with Obama," said Farah Ossouli, who helped to organize the artists' exhibition. "But if Ahmadinejad stays, we are not sure he wants relations with the United States."
The next day, at Mousavi headquarters, I met Mostafa Hassani, 27, the whiz kid who came up with the idea of using green. It's a concept that Hassani, a prize-winning design student, came up with in 2008, even before he knew who'd be running. "I wanted something that could unite the country. We decided on green. Everyone can have access to something green, and when you make something common, like a logo, people can adopt it." He brought the idea to the Mousavi campaign a few weeks ago, and it clicked. He started with green arm bands, and it's expanded. The latest innovation is a green-paint handprint and a green checkmate, for a vote. "People can slap their hands on the wall, even in remote areas."
It's a long and difficult climb for Mousavi, of course. But everywhere, it seems, support for Ahmadinejad is lackluster, and the Mousavi green wave is growing. The campaign, including an unprecedented series of TV debates, is growing bitter. Today, I'm going to a rally for Ahmadinejad, the former mayor of Tehran, in the center of the city. Stay tuned.

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