A Place in the Auvergne: A Place in the Auvergne, Friday, 5th September 2008

0841

IW: The U.S.A., with its allies Pakistan and the Mayor of the City of Kabul, are now, de facto at war with a country which is on the brink of being a failed state.

Rural Thais say Bangkok protests hit livelihoods

BAAN BANGSAI, Thailand: Rural Thais say the middle class Bangkok protesters occupying Prime Minister Samak Sundaravej's compound are destroying their livelihoods and should end their three-month campaign to topple the government.
They say demand for their goods has been hurt by a state of emergency that prompted some schools in Bangkok to close and has made people spend less, while rail and port strikes hit sales at home and abroad.
Somporn Graisamran, a fish supplier to Bangkok markets, said she now made a third of what she was making two months ago after a state of emergency declared on Tuesday.
"I want to see it over as soon as possible. I don't want to see my business suffer further losses," Somporn said on Friday in Baan Bangsai, a village 80 km (50 miles) north of Bangkok.
If she sold less fish, that meant fish farmers in Baan Bangsai earned less and fewer labourers were hired to catch fish for the market, she said, adding her daily sales had gone down to 500 kg (1,100 lb) from nearly 2 tonnes.

The protests are led by the People's Alliance for Democracy (PAD), a coalition of royalists, academics and businessmen.
The PAD protesters, wearing the royal colour of yellow, want Prime Minister Samak Sundaravej's government to quit, accusing him and former Prime Minister Thaksin Shinawatra -- now in exile in London after fleeing corruption charges -- of wanting to turn the kingdom into a republic, a charge both deny.

"Many of these well-off protesters may think they can afford to join the rally, but they don't realise that the demonstration is hurting everybody else in this country," Prapha said.

"I only wish they would stop soon. I am very eager to see them arrested, with the authorities taking decisive action to deal with them," said Chaiyaporn, whose glass business had also slowed.
"I don't care who leads the government, I just want a government that can move the country forward," he said.
The village's handicraft business got a big boost after Thaksin became prime minister in 2001 and launched a nationwide programme to create jobs for villagers -- one of the reasons why he and Samak, an ally, are so popular in the countryside.
"Our living conditions improved significantly during the Thaksin government. We don't know if he was corrupt, but we know that he made our lives better," glass blower Prapha said.

http://www.iht.com/articles/reuters/2008/09/05/asia/OUKWD-UK-THAILAND-PROTEST-COUNTRYSIDE.php

******************

Sorrow overwhelms in Haitian storm shelter

GONAIVES, Haiti: Survivors of Tropical Storm Hanna crowded a shelter in the Haitian port city of Gonaives on Thursday, weeping for loved ones swept away by the floods and lining up to register for food that did not arrive.
Most had eaten nothing since Hanna's torrential rains submerged Gonaives under 2 metres (6.5 feet) of water on Tuesday. Some had only the clothes on their backs, others not even that.
"I lost everything in the flooding. All I own is what I wear," said Gerta Meus, cradling her naked 2-year-old daughter.
At least 136 people died in floods and mudslides triggered by Hanna, many of them in the Gonaives area, said the civil protection office in the poorest country of the Americas.
Afflicted by political chaos, bloodshed and natural disasters since it won independence from France in a slave revolt two centuries ago, the mud-caked scenes of misery in Gonaives were not unprecedented for Haiti. The last time floods like this occurred in Gonaives in 2004, 3,000 died.

Many in Gonaives survived this time by scrambling onto rooftops as the water rose, then waded through the mud to the shelter after it receded.
Jacqueline Meranvil, 21, said she and her younger sister climbed first onto the top of a fence and from there onto their roof, "but my mother who is 60 could not climb and we couldn't help her so she died."
Hoarse from screaming and weak from hunger, Widline Jean-Louis sat on the shelter floor trying to breastfeed her 13-month-old daughter.
"The water entered my house and some people helped us get on top of the roof but when my husband was coming to join us he tried to climb on top of the roof and fell and he was taken away by the water before our eyes," Jean-Louis said.
"My daughter is very sick and nobody's there to help me."
Bridges and roads were washed out, making it difficult for aid to reach the coastal city. Children cried from hunger while adults lined up to register to receive food but there was none to distribute. The food warehouses had flooded.
Hospital patients had been taken to the shelter and left there to fend for themselves.
A woman whose 3-month-old son was born with hydrocephalus, an enlarged head, said he had been receiving intravenous medicine at the hospital but they had to leave it because of the flooding. Without food or medicine, he was growing sicker and sicker, she said.
A medical team from the aid group Doctors Without Borders arrived on Thursday and was setting up a clinic in the Raboteau slum neighbourhood, but it was soon overwhelmed by the number of people asking for help.
Some people simply roamed the muddy streets, looking for something to eat or somewhere else to go.

http://www.iht.com/articles/reuters/2008/09/05/america/OUKWD-UK-STORM-HANNA-HAITI.php

OPINION

EAST V. WEST II
Kosovo 1999 to Georgia 2008

David Owen, chancellor of the University of Liverpool, was Britain's foreign secretary in 1977-79 and a European Union peace negotiator in the former Yugoslavia 1992-95. This article was adapted from Lord Owen's address to the M100 Sanssouci Colloquium in Potsdam, Germany.

For some years it has been clear that the wise course has been to put EU membership for Georgia and Ukraine ahead of their membership in NATO. The first lesson from the fighting in Georgia is to speed up EU membership for both, and not to advance NATO membership so long as boundary disputes remain.
The other key lesson is to make EU membership for Turkey a priority. Turkey is the one country which can help the EU seriously diversify its gas and oil supply. Turkey, along its entire length, can and should have a gas and oil pipeline to supply Europe - not just from the Caspian Sea and the countries surrounding it, but eventually from Iraq and Iran as well.
Turkey must be a partner in this EU energy enterprise and it will be far more committed to the project when it sees that objections to its EU entry from France and to a lesser extent Germany have been put to rest and that there is a reliable timetable for entry into the Union.
This is not an anti-Russian proposal. Diversity of energy is a national interest for Russia as well as European nations - a diversity of customers for Russia, a diversity of suppliers for Europe.
Russia is building an oil pipeline to the Far East, with very substantial financial funding from Japan. A gas pipeline will eventually follow. Russia is also pledged to build an oil pipeline into China and it is moving into shipping liquefied natural gas.

http://www.iht.com/articles/2008/09/05/opinion/edowen.php

***************

EDF seen reviving British Energy bid

French utility EDF has moved closer to a deal to buy nuclear generator British Energy after fruitful talks with some of the company's biggest investors, the Financial Times said on Friday.
EDF, the world's biggest single producer of nuclear energy, has offered to boost its 12 billion pound bid, rejected by British Energy shareholders a month ago, depending on future performance.
The FT said negotiations were still at an early stage with British Energy's investors, which include Invesco Perpetual, its second-biggest shareholder, with 15 percent of the group.
The talks have made progress, but could still fail, the paper said, citing people close to the matter.
M&G, the group's third-largest investor, with 7 percent, says it has had no conversations with EDF.

http://www.iht.com/articles/reuters/2008/09/05/business/OUKBS-UK-EDF-BRITISH-ENERGY.php

LUDZIDZINI, Swaziland: Once upon a time, a young and handsome king ruled over a land of mountainous splendor near the southern tip of Africa. He liked to get married, and as the years passed he took 13 wives, each of them a great beauty.
His countrymen wanted His Majesty to be happy, but some also thought so many spouses were an extravagance for a poor, tiny nation. After all, the king, Mswati III, often provided these wives a retinue, a palace and a new BMW.
A great event was soon forthcoming - on Saturday, in fact. To prepare for the day - the 40-40 Celebration, so-named to honor the king's 40th birthday and the nation's 40th year of independence - a new 15,000-seat stadium was built and a fleet of top-of-the-line BMW sedans was ordered for the comfort of visiting dignitaries.
Once again, some people wondered how the kingdom, Swaziland, could afford the expense. Some 1,500 of them grumpily marched in protest through the capital after news reports said that several of the king's wives and their entourages had gone on an overseas shopping trip aboard a chartered plane.

The angriest of them went so far as to insist the nation had little to celebrate. Yes, Swazis have enjoyed decades of peace and are rightfully proud of their culture. But poverty has entrapped two-thirds of the people, leaving hundreds of thousands of them malnourished. And these days death casually sweeps away even the strong. The country has one of the worst rates of HIV infection in the world. Life expectancy has fallen from 60 years in 1997 to barely half that now. Nearly a third of all children have lost a parent.
"How can the king live in luxury while his people suffer?" asked Siphiwe Hlophe, a human rights activist. "How much money does he need, anyway?"
That question was as confounding as it was impertinent. In the government's latest budget, about $30 million was set aside for "royal emoluments."
But surely the king's income exceeds that, people said. The royal family also controls a corporate business empire "in trust for the nation," investing in sugar cane, commercial property and a newspaper. Forbes.com, which is fond of ranking the rich, recently listed Mswati as the world's 15th-wealthiest monarch, estimating his fortune at $200 million.

http://www.iht.com/articles/2008/09/05/africa/swaziland.php?pass=true

OPINION

EAST V. WEST I
A hot war is no way to prevent a cold one

Sir Malcolm Rifkind was Britain's foreign secretary in 1995-1997.

There are appropriate responses to Russia's actions, including tough diplomacy and the prospect of membership for Georgia and Ukraine in the European Union. However, inviting them into a collective defense mechanism is a knee jerk reaction that lacks strategic logic. It could be like the origin of the First World War, when binding large nations' security to the fortunes of smaller ones created Armageddon after the murder of an archduke.
As any student of European history can tell you, that is a poor plan for deterring conflict. Inviting a hot war is no way to prevent a cold one.

http://www.iht.com/articles/2008/09/05/opinion/edrifkind.php

U.S. employers cut 84,00 jobs in August; jobless rate 6.1%

http://www.iht.com/articles/2008/09/05/business/05usecon.php

BHP suspends Australia iron ore mining after death

SYDNEY: BHP Billiton suspended all its iron ore mining in Australia on Friday, shutting in a third of the country's production after the second mine worker death in the past 10 days, raising broader safety concerns in its mines.
A BHP spokeswoman could not say when the mines might re-open. In the case of past fatalities that have resulted in the closure of individual mines, including one less than two weeks ago, operations have resumed within a day or two following police and special emergency mine investigations.
But analysts worried that the prolonged loss of BHP's output -- 91 million tonnes a year of ore last year, roughly 10 percent of the globally traded market -- could tighten spot markets, especially after an unrelated force majeure by rival Rio Tinto.
The fatality, which occurred on Thursday at BHP's Yandi mine, 500 kilometres (310 miles) east of the western coast in the Pilbara district, follows the death of another worker at the mine on August 26.
"We're concerned that incidents such as this may distract employees' attention away from the task, which could put them at risk. So by suspending operations, we can reduce the risks associated with that," the spokeswoman said.
BHP employs around 8,000 people across the Pilbara, roughly 18 percent of the outback region's total population. It is the world's third-largest supplier of iron ore after Brazil's Vale and Rio Tinto .
The giant mining pits more resemble excavation sites than most people's idea of mine camps. Ore is simply churned up by bulldozers and carted in trucks to waiting open-topped rail cars.
A typical train is about a mile long and consists of 300 cars hauling 24,000 metric tonnes of ore each hundreds of miles to waiting freighters. On average a trainload leaves a mine every hour day and night.
FOURTH DEATH IN A MONTH
The latest death is the fourth fatality at a BHP operation in the past month.
A worker was killed at the Klipspruit coal mine in South Africa when a drill rig toppled over. A day before that an employee was killed at the company's Port Hedland, Australia iron ore loading terminal.
The two most recent deaths in Australia involved workers under contract to BHP from HWE Mining, owned by Leighton Holdings Ltd .
Thursday's fatality was caused by a collision between a light vehicle and a truck, the BHP spokeswoman said.
The traded market for iron ore is sensitive to any disruptions to supply amid a global shortage brought on by growing orders from Asian steel makers.
But China, which is more dependent on the spot market than most nations, is in a better position to weather disruptions than it was earlier this year, with some 60 million tonnes of ore -- roughly one month's consumption -- is stockpiled in ports.
Competition for ore has enabled BHP and other Australian miners to raise ore prices by as much as 86 percent this year.
http://www.iht.com/articles/reuters/2008/09/05/business/OUKBS-UK-BHPBILLITON-SUSPENSION.php

Rich in reserves, Chinese central bank is short of capital

HONG KONG: China's central bank is in a bind.
It has been on a buying binge in the United States over the last seven years, snapping up roughly $1 trillion worth of Treasury bonds and mortgage-backed debt issued by Fannie Mae and Freddie Mac.
Those investments have been declining sharply in value when converted from dollars into the strong yuan, casting a spotlight on the central bank's tiny capital base. The bank's capital, just $3.2 billion, has not grown during the buying spree, despite private warnings from the International Monetary Fund.
Now the central bank needs an infusion of capital. Central banks can, of course, print more money, but that would stoke inflation. Instead, the People's Bank of China has begun discussions with the finance ministry on ways to shore up its capital, said three people familiar with the discussions who insisted on anonymity because the subject is delicate in China.
The central bank's predicament has several repercussions. For one, it makes it less likely that China will allow the yuan to continue rising against the dollar, say central banking experts. This could heighten trade tensions with the United States. The Bush administration and many Democrats in Congress have sought a stronger yuan to reduce the competitiveness of Chinese exports and trim the American trade deficit.

The central bank has been the main advocate within China for a stronger yuan. But it now finds itself increasingly beholden to the finance ministry, which has tended to oppose a stronger yuan. As the yuan slips in value, China's exports gain an edge over the goods of other countries.
The two bureaucracies have been ferocious rivals. Accepting an injection of capital from the finance ministry could reduce the independence of the central bank, said Eswar Prasad, the IMF's former division chief for China.
"Central banks hate doing that because it puts them more under the thumb of the finance ministry," he said.
Prasad said that during his trips to Beijing on behalf of the fund, he had repeatedly cautioned China over the enormous scale of its holdings of American bonds, emphasizing that it left China vulnerable to losses from either a strengthening of the yuan or from a rise in American interest rates. When interest rates rise, the prices of bonds fall.
Officials at the central bank declined to comment, while finance ministry officials did not respond to calls or questions via fax seeking comment. Data in a study by the Bank of International Settlements based in Basel, Switzerland, sometimes called the central bank for central banks, shows that many central banks had small capital bases relative to foreign reserves at the end of 2002, though few were as low as the People's Bank of China.
Given the poor performance of foreign bonds, the Chinese government could decide to shift some of its foreign exchange reserves into global stock markets.
The central bank started making modest purchases of foreign stocks last winter, but has kept almost all of its reserves in bonds, like other central banks.
The Finance Ministry, however, has pushed for investments in overseas stocks. Last year, it wrested control of the $200 billion China Investment Corp., which had been bankrolled by the central bank. That corporation's most publicized move, a $3 billion investment in the Blackstone Group in May of last year, has lost more than 43 percent of its value.
The central bank's difficulties do not, by themselves, pose a threat to the economy, economists agree. The government has ample resources and is running a budget surplus. Most likely, the Finance Ministry would simply transfer bonds of other Chinese government agencies to the bank to increase its capital. But even in a country that strongly discourages criticism of its economic policies, hints of dissatisfaction are appearing over China's foreign investments.
For instance, a Chinese blogger complained last month, "It is as if China has made a gift to the United States Navy of 200 brand new aircraft carriers."
Bankers estimate that $1 trillion of China's total foreign exchange reserves of $1.8 trillion are in American securities. With aircraft carriers costing up to $5 billion apiece, $1 trillion would, in theory, buy 200 of them.
By buying U.S. bonds, the Chinese government has been investing a large chunk of the country's savings in assets earning just 3 percent annually in dollars. And those low returns turn into real declines of about 10 percent a year after factoring in inflation and the yuan's appreciation against the dollar.

The yuan has risen 21 percent against the dollar since China stopped pegging its currency to the dollar in July 2005.
The actual declines in value of the central bank's various investments are a carefully guarded state secret.
Still China finds itself hemmed in. If it were to curtail its purchases of dollar-denominated securities drastically, the dollar would likely fall and American interest rates could soar.
China spent more than one-eighth of its entire economic output last year on foreign bonds, and then picked up the pace during the first half of this year. Chinese officials have suggested in recent comments that they are increasingly interested in stopping the yuan's rise, and thus are willing to continue buying foreign securities to support the dollar. In fact, the yuan weakened slightly against the dollar last month after 26 consecutive months of gains.
Along with Treasuries, China has invested heavily in mortgage-backed bonds from Fannie Mae and Freddie Mac, the struggling mortgage finance giants that are sponsored by the United States government. Standard & Poor's estimates China's holdings at $340 billion.
Some bond traders suspect that the central bank has scaled back its purchases of these securities, as have China's commercial banks. But the central bank trades this debt through many third parties in many countries, making its activity opaque to outside analysts.
The central bank has gone to great lengths to maintain its foreign purchases. The money to buy foreign bonds has come from the reserves required that commercial banks must deposit with the central bank. In effect, China's commercial banks have been lending the central bank more than $1 trillion at an interest rate of less than 2 percent.
To keep the banks strong when they were getting such little interest on their reserves, the central bank has kept deposit rates low. The gap between what banks are paying on deposits and the rates they are charging ordinary customers to borrow is several percentage points. This amounts to a transfer of wealth from ordinary Chinese savers to the central bank and on to Americans who are selling their debt to the Chinese.
Nicholas Lardy, a Chinese finance specialist at the Peterson Institute for International Economics, estimated in a paper in early August that China's decision to hold bank deposit rates far below inflation costs families in China more than three times as much as the country's personal income tax.
The central bank is now under considerable pressure to reduce the commercial banks' reserve requirements to encourage growth as the Chinese economy shows signs of slowing.
Victor Shih, a specialist in Chinese central banking at Northwestern University, said that when he visited the People's Bank of China for a series of meetings this summer, he was surprised by how many officials resented the institution's losses.
He said the officials blamed the United States and believed the controversial assertions set forth in the book "Currency War," a Chinese best seller published a year ago. The book suggests that the United States deliberately lured China into buying its securities knowing that they would later plunge in value.
"A lot of policy makers in China, at least midlevel policy makers, believe this," Shih said.

http://www.iht.com/articles/2008/09/05/business/05yuan.php

Oil falls $2 to 5-month low
http://www.iht.com/articles/reuters/2008/09/05/business/OUKBS-UK-MARKETS-OIL.php

****************
Global stocks at 2-year low
HONG KONG: Investors dumped euros and shares on Friday as U.S. economic troubles made bets on growth elsewhere look too risky, sending stocks to their lowest in two years while triggering a surge in safe-haven government bonds.
http://www.iht.com/articles/reuters/2008/09/05/business/OUKBS-UK-MARKETS-GLOBAL.php

The Corpse Walker: Real Life Stories, China From the Bottom Up.
By Liao Yiwu.
Translated and with an introduction by Wen Huang.
320 pages. $25. Pantheon Books.
Often in China a phone call wakes me: a voice from the provinces wondering how things are in the capital. Is the weather fine? How's work? Did the puppy smuggler pass through, toting his squirming sack? Have you heard about that lumberjack who impregnated the extraterrestrial? Or the woman whose teacher was visited by a raccoon spirit in her dreams? My neighbors look different after I hear these tales. I wonder what secrets the jolly vegetable seller harbors, and what led the disabled news vendor to resettle on my street. In China, learning such secrets requires time, empathy and the suspension of disbelief.
The Chinese writer Liao Yiwu displays all three in his interviews with the sorts of individuals who are often ignored beyond their immediate community - the busker, the public latrine attendant, the neighborhood cadre, the migrant worker. Twenty-seven of these conversations are collected in "The Corpse Walkers," an industrious, well-crafted recording of oral histories, almost all from the southwestern province of Sichuan.

Traditions, rites and roles are being altered here too. Liao interviews a professional mourner, hired to wail for the deceased at funerals, who is losing work as farmers adopt urban habits. "People are not what they used to be," he laments. "They don't even bother to pretend to be sorrowful."
http://www.iht.com/articles/2008/09/05/news/bks6.php

The Shop

BOOK REVIEW

Fine Just The Way It Is
Wyoming Stories 3.
By Annie Proulx.
221 pages. $25, Scribner; £8.99, Fourth Estate .

In Annie Proulx's new story collection, a young rancher about to build a cabin on his claim in the late-19th-century Wyoming wilderness walks the perimeter of his 80 acres singing old cowboy songs. This ritual marking of his place takes him all day, and in the dusk he returns, his voice a raspy whisper. The careful observation of such a ceremony would seem to suggest that time might shed its blessings on the rancher and his wife, that they might enjoy peace and ease here and the grace of days.

Right after Archie, the fresh young landowner in "Them Old Cowboy Songs," sings the property line, Proulx throws in an uncharacteristically sunny aside: "There is no happiness like that of a young couple in a little house they have built themselves in a place of beauty and solitude." From time to time, you glimpse an Eden in Proulx's world, and when you see it, you'd better take a photograph, because it won't last long. More often her narratives are richly and bleakly Dickensian, right down to the names.

http://www.iht.com/articles/2008/09/05/news/bks6.php?page=2

LETTERS
NATO raid in Pakistan
In reference to the page one article "Pakistanis say NATO raid killed 7 civilians (Sept. 4): Does national sovereignty mean nothing anymore? By attacking Pakistan, the United States is de-legitimizing the new government, contributing to civil breakdown and encouraging new pockets of insurgency that will not respect the rule of law.
No developing country can stand up to NATO - by default Pakistanis will have no respect for their government, which cannot protect them against such raids. If in the wake of the 9/11 attacks the aim of the United States was to create a path of failing states (Afghanistan, Iraq, now Pakistan) then it is a job well done. If NATO troops are willing to trespass onto the soil of Pakistan, which they consider their allies, to what lengths will they go to attack their foes?
Erum Shazia Hasan, Ottawa
http://www.iht.com/articles/2008/09/05/opinion/edletters.php

*******************
Polish prosecutors probe possible CIA jail
WARSAW: The Polish prosecutor's office is investigating claims there was a CIA prison in Poland for al Qaeda suspects where guards might have used methods close to torture, the prime minister's top adviser said on Friday.
Polish media reported earlier on Friday that a classified note written by the Polish secret service had proved the existence of a U.S. Central Intelligence Agency base in Poland.
"I am not familiar with such a note and I don't think Prime Minister Donald Tusk is either," Slawomir Nowak, who heads Tusk's political office, said in an interview with Tok FM radio.
"But the premier asked the justice minister to clarify this matter and the country's prosecutor's office is investigating the potential existence of the CIA prison."

"There definitely was cooperation between Polish and American secret services," a source close to the secret service told Reuters. "But whether there was torture at the base, hopefully we will learn about that soon."
Foreign and local media speculated that the base was operational between 2002 and 2005, while Aleksander Kwasniewski was president and Poland was run by the leftist governments of Leszek Miller and Marek Belka and then a rightist administration under Kazimierz Marcinkiewicz.
DENIALS
All three former prime ministers have denied any knowledge of such a prison or base, as have many other senior officials including top secret service personnel. Tusk's centre-right cabinet has also played down the speculation.
"I hope this will not be confirmed," Nowak said. "It would not only have serious consequences inside the country but would also take a very serious toll on the international scene."
"This has to be investigated very carefully, without emotions."
Asked about the case during a visit to France, Polish Foreign Minister Radoslaw Sikorski urged discretion.
"I think this is all speculation about things that should be kept secret among all countries which take part in such cooperation. Let's leave it alone. The less we talk about it the better," Sikorski told reporters in Avignon.
http://www.iht.com/articles/reuters/2008/09/05/europe/OUKWD-UK-POLAND-CIA-PRISONS.php

*************
U.S. missile strike said to have killed at least 6 on Afghan-Pakistani border
ISLAMABAD, Pakistan: A missile strike from a United States pilotless reconnaissance aircraft killed between six and 12 people in a group of houses in southern Afghanistan, very close to the border with Pakistan, Pakistani residents of the area said Friday.
The strike came after the United States launched a commando raid by Special Operations forces in South Waziristan in Pakistan on the border with Afghanistan on Wednesday, the first of what American military officials said could be more raids to attack Taliban insurgents in Pakistan's tribal region. After the raid Wednesday, Pakistan lodged a "strong protest" with the American government and reserved the right of retaliation.
The spokesman for the Pakistani Army, Major General Athar Abbas, said that the missile strike Friday did not take place inside Pakistani territory. "There was no air strike in Pakistan, or near Miran Shah or in North Waziristan," Abbas said, referring to Miran Shah, the capital of North Waziristan, a tribal region in Pakistan that borders Afghanistan.
Residents in Miran Shah also said that the missile strike Friday morning hit a target inside Afghanistan, and not inside Pakistan.
They said the attack struck two residential compounds in the village of Al Must, less than a mile from the Pakistani border.
According to reports from Al Must reaching Miran Shah, six to twelve people, including men of Arab descent, were killed, said Ahsan Dawar, a journalist in Miran Shah. Two women and three children were among the dead, Dawar said.
He said that three missiles hit the two compounds, which he said belong to Hakeem Khan and Arsala Khan, in Al Must. It is common for families in this areas to rent part of their compound to foreigners, especially Arabs, who are involved in the planning of attacks against NATO forces in Afghanistan.
Dawar said that a pilotless American aircraft struck a large house in another village, Chaar Kehl, about 16 miles west of Miran Shah on Thursday. In that attack, at about 5 p.m. Thursday, seven Arab men were killed, he said.
Al Must is on the Afghan side of the border region called Gurwak, which is locally known as Ground Zero and is considered the demarcation line between Pakistan and Afghanistan, Dawar said.
Another local resident, Mahmood Khan, said that pilotless aircraft were seen over Al Must at 9 a.m. Friday morning.
The strikes Friday appeared to indicate that the United States was forging ahead with a tougher strategy to curb the escalating numbers of Taliban fighters crossing from Pakistan to attack American and NATO soldiers fighting in Afghanistan.
http://www.iht.com/articles/2008/09/05/asia/06pstan.php

****************
Foreign troop deaths in Afghanistan at highest level
KABUL: More foreign soldiers were killed in Afghanistan during August than in any other month since the 2001 U.S.-led invasion, an independent website said, reflecting a rise in Taliban attacks.
Forty-three foreign soldiers were killed in combat in August, five more than in June, the second highest month, according to icasualties.org, an independent website that tracks troop casualties in Afghanistan and Iraq.
While not confirming that August was the deadliest month for foreign troops, the top military spokesman for the NATO-led force in Afghanistan said that deaths had peaked this summer.
"I know that combined together, the three summer months have been the worst since 2001," Brigadier-General Richard Blanchette told Reuters on Friday.
Afghanistan has seen a significant year-on-year rise in foreign troop deaths since 2003 and that trend looks set to continue. More than 200 soldiers have been killed in combat and by other causes already this year, compared with 232 in 2007.
"Yes indeed, that's a good description," Blanchette said when asked whether the increase in troop deaths was due to the Taliban mounting more attacks on foreign forces.
"This is a resilient insurgency. There are still a large number of opponents. These militants are well organised, they are still in a position to mount attacks," he said.
Like Iraq, improvised explosive devices (IEDs), or roadside bombs, are the main cause of death for foreign troops in Afghanistan. Between April and June this year there were about 200 such incidents, the highest level in at least four years.
"The use of IEDs has increased by a large percentage," Blanchette said.
AMBUSH
The Taliban have also been able to launch more daring and deadly attacks on foreign forces, in what Canada's top general acknowledged was a worrying jump in direct violence after three Canadian soldiers were killed this week.
Last month, 10 French soldiers were killed in an ambush just outside the capital, Kabul, in what was the biggest single loss of foreign soldiers in combat since the beginning of the war.
In July, nine U.S. soldiers were killed in a single attack on an Afghan army and NATO outpost in northeastern Afghanistan.
While civilian casualties have also mounted in recent months, it is the issue of troop deaths that has sparked fresh debates in some countries about their continued presence in Afghanistan.
http://www.iht.com/articles/reuters/2008/09/05/asia/OUKWD-UK-AFGHAN-TROOP-CASUALTIES.php

********************
U.S. plan would shift troops from Iraq to Afghanistan
WASHINGTON: The United States would carry out a modest shift of American forces from Iraq to Afghanistan by early next year under a confidential recommendation to President George W. Bush by the Pentagon's top civilian and military leaders, according to Bush administration officials.
The number of American combat brigades in Iraq would shrink to 14 in February from the current level of 15, according to the recommendation, the officials said. All told, the number of American forces in Iraq, which currently number about 146,000, would drop by nearly 8,000 by March.
That is a smaller reduction than some officials had earlier suggested might be possible before President George W. Bush leaves office in January, given the significant decline in violence in Iraq. But it reflects the caution of General David Petraeus, who is leaving his post as the senior American commander in Baghdad this month, about the still-unsettled situation in Iraq.
The recommendation on the troop shift was presented to Bush on Wednesday in a video-conference by Defense Secretary Robert Gates and Admiral Mike Mullen, the chairman of the Joint Chiefs of Staff. American officials said that it was the product of extensive consultations between the Pentagon officials and Petraeus.
Under the proposal, an army brigade and a Marine battalion would be sent to Afghanistan by early next year, adding about 4,500 troops to American forces there. They would represent a partial but still significant move toward meeting repeated requests from American commanders in Afghanistan for three more brigades, a reinforcement that the commanders say is necessary to carry out the mission there.
http://www.iht.com/articles/2008/09/05/africa/05military.php

******************
Suicide bomber targets Chalabi convoy
BAGHDAD: A suicide car bomber targeting the convoy of influential Shi'ite politician Ahmed Chalabi killed two people and wounded 17 others on Friday, Iraqi police said.
His office said Chalabi, a key adviser to Washington in the build up to the U.S.-led invasion of Iraq in 2003, was in the convoy but was unharmed.
Five of his bodyguards were wounded, police said. The other wounded were civilians. The dead were not immediately identifiable.
The convoy was travelling to one of Chalabi's offices.
http://www.iht.com/articles/reuters/2008/09/05/africa/OUKWD-UK-IRAQ-CHALABI.php

******************
Qaeda "still dangerous" in Iraq
BAGHDAD: Al Qaeda remains a dangerous force in Iraq despite a general decline in violence and U.S. troops must continue to confront the militant group, the outgoing top U.S. general in the country said.
General David Petraeus told al Arabiya television he believed recent success in reducing violence had restored the United States' image with Iraqis. Troops initially greeted as liberators but later viewed as occupiers were now again accepted as friends.
In the interview recorded on Monday and scheduled for broadcast later on Friday, Petraeus was asked whether al Qaeda had been defeated in Iraq.
"You will not find any military leader who will say this ... all we can say is al Qaeda is still dangerous," he said.
Petraeus' comments were translated into English from an Arabic transcript of the interview sent to Reuters.
"It is certain more of these crimes will be committed, and we must continue working to confront these attacks," he said.
Petraeus and his former deputy and designated successor Lieutenant-General Raymond Odierno are together credited with implementing a military strategy that helped reduce violence in Iraq, which slid towards sectarian civil war after the bombing of a revered mosque in early 2006.
Pentagon sources said this week that Petraeus had recommended the United States move slowly to draw down troops in Iraq, removing one combat brigade early next year.
A combat brigade consists of 3,000 to 5,000 troops.
"There are many missions that have not been achieved ... Any person who replaces me and who is honest with himself must admit these facts," Petraeus said.
http://www.iht.com/articles/reuters/2008/09/05/africa/OUKWD-UK-IRAQ-PETRAEUS.php

*********************
Massacre feared if Iranians in Iraq handed over
GENEVA: The United States risks a Srebrenica-style massacre if its forces in Iraq hand over responsibility for more than 3,000 exiled opposition Iranians to Iraqi authorities, an international lawyers' group has said.
The International Committee of Jurists in Defence of Ashraf said the Iranians would be in danger as pro-Shi'ite elements of Iraq's government close to Tehran could expel them to Iran.
Camp Ashraf, 70 km (40 miles) north of Baghdad, has housed Iranian refugees and the exiled opposition People's Mujahideen Organisation of Iran (PMOI) for two decades. U.S. forces who toppled President Saddam Hussein have protected it since 2003.
But the residents' fate hangs in the balance as U.S. forces negotiate the transfer of territory to Iraq's government, which says PMOI is a terrorist group, the Paris-based committee said.
"We fear we will end up with a situation like Srebrenica," said Marc Henzelin, a committee member who visited Ashraf last month, told a news briefing on Thursday.
http://www.iht.com/articles/reuters/2008/09/05/africa/OUKWD-UK-IRAQ-ASHRAF.php

*****************
Bush advised to back modest troop cuts in Iraq
WASHINGTON: Top U.S. defence officials have recommended that President George W. Bush withdraw one combat brigade from Iraq but not until early next year, Pentagon sources said on Thursday.
A U.S. Army combat brigade has 3,000 to 5,000 troops. The United States now has 15 combat brigades in Iraq as well as many other units, making a total of more than 140,000 troops.
Any cut in Iraq would allow the United States to increase forces in Afghanistan, where commanders have called for more troops to combat rising violence by Islamist militants from al Qaeda and the Taliban. The United States has some 33,000 troops in Afghanistan.
A Pentagon spokesman said he could not discuss details of the recommendations and administration officials cautioned that Bush had not yet approved any course of action.
"The president is now considering his options," White House spokeswoman Dana Perino told reporters.
While violence in Iraq has dropped dramatically in the past year, the proposed cutback is smaller than some analysts had predicted, reflecting the desire of Army Gen. David Petraeus, the top commander in Iraq, not to jeopardize security gains.
Three Pentagon sources told Reuters that Petraeus had agreed to shift from 15 brigades to 14. Two sources said the change would not take place until early next year.
One source said the recommendation also included other, smaller units but did not elaborate.
Bush heard the Pentagon's recommendations on Wednesday in a videoconference with Defence Secretary Robert Gates and Adm. Mike Mullen, the chairman of the U.S. military's Joint Chiefs of Staff, officials said.
"Secretary Gates and Chairman Mullen presented President Bush with their recommendations on how many additional forces could be safely taken out and how soon," Pentagon press secretary Geoff Morrell said.
He said Gates and Mullen also presented the views of Petraeus and Army Lt. Gen. Martin Dempsey, acting head of the U.S. military headquarters for operations in the Middle East, and all were "fundamentally in agreement."
http://www.iht.com/articles/reuters/2008/09/05/africa/OUKWD-UK-IRAQ-USA-TROOPS.php

******************
New book says U.S. spied on Iraqi leaders
WASHINGTON: The United States has spied on Iraqi Prime Minister Nouri al-Maliki and other Iraqi leaders, according to U.S. journalist Bob Woodward's fourth book on President George W. Bush, The Washington Post reported on Friday.
"We know everything he says," one of Woodward's sources on the extensive spying operation is cited as saying in the book being released on Monday, the newspaper reported.
The book titled "The War Within: A Secret White House History 2006-2008," also says that the U.S. troop surge of 2007 was not the primary factor behind the steep drop in violence in Iraq, the Post reported.
Woodward reports "groundbreaking" new covert techniques, beginning in 2007, enabled U.S. military and intelligence officials to locate, target and kill insurgent leaders and key individuals in extremist groups such as al-Qaeda in Iraq.
Woodward did not provide much detail about the covert operations and wrote he was asked to withhold specifics because of national security concerns, the newspaper said.
"The book portrays an administration riven by dissension, either unwilling or slow to confront the deterioration of its strategy in Iraq during the summer and early fall of 2006," The Post said.
The newspaper said Woodward also wrote about ongoing tension within the Bush administration over the quality and credibility of information about the progress of the war in Iraq.
U.S. Secretary of State Condoleezza Rice complained about the Defence Department "overconfident" briefings during the tenure of then Pentagon chief Donald Rumsfeld.
Rice is quoted as saying that Bush would get "a fable, a story . . . that skirted the real problems," according to the Post.
The book also depicts the development of a close working relationship between Bush and Maliki, the report said.
Woodward writes that the surveillance of the Iraqi prime minister caused some consternation among several senior U.S. officials who questioned whether it was worth the risk given Bush's effort to earn his trust, the Post reported.
http://www.iht.com/articles/reuters/2008/09/05/america/OUKWD-UK-BUSH-IRAQ-BOOK.php

******************
U.S. letter incites push to oust India leader
NEW DELHI: Indian opposition parties are once again calling for the resignation of Prime Minister Manmohan Singh, saying that a secret letter from the State Department, made public on Tuesday, shows he lied about a controversial deal that would allow India to buy nuclear fuel and technology on the world market to generate nuclear power.
The State Department's letter to Congress said that the United States could immediately halt nuclear sales to India if India conducted any nuclear tests and that the United States planned to withhold technology that poses a security risk.
The letter was released by Representative Howard L. Berman, Democrat of California and chairman of the House Foreign Affairs Committee.
Singh told lawmakers last year that "the agreement does not in any way affect India's right to undertake future nuclear tests, if it is necessary."
India's Ministry of External Affairs said in a press release on Wednesday that "we do not as a matter of policy comment on the internal correspondence between different branches of another government."
http://www.iht.com/articles/2008/09/05/asia/05india.php

********************
Air of corruption dogs Pakistani leader
ISLAMABAD: Asif Ali Zardari, the widower of Benazir Bhutto, is set to become president Saturday, an accidental ascent for a man known more as a wheeler-dealer than a leader. He will start his tenure burdened by a history of corruption allegations that cloud his reputation even as they remain unproved.
He has won the reluctant support of the Bush administration, which views him as a pliable partner in the campaign against terror. Still, Zardari will assume the presidency with what Washington and many here consider to be untested governing skills at a time when a tough Taliban insurgency threatens the very fabric of this nuclear-armed state of 160 million people.
It remains to be seen how forcefully he will act against militants in the face of Pakistani public opposition to American pressure. It is also unclear how much influence he exerts over the still-powerful military and the Inter-Services Intelligence agency.
The editor in chief of The Daily Times, Najam Sethi, a supporter of Zardari, said his elevation would suit the Americans. Zardari, he said, "will learn on the job." And indeed, Zardari, 53, has shown canny political skills as he moved in the last two weeks to outmaneuver his rival and then-coalition partner, Nawaz Sharif.
But while the economy is in a downward spiral and foreign exchange reserves are perilously low, Zardari's reputation for using political perches to benefit himself and his friends has left many here and in Washington worried about how he will restore economic confidence. There are concerns about the oversight of a 10-year, $15 billion package of nonmilitary assistance that was proposed in July by Senator Joseph Biden, now the Democratic vice-presidential candidate, and backed by the Bush administration.
Zardari declined to be interviewed for this article. The minister for information, Sherry Rehman, said it was too "sensitive" for Zardari to talk before the election, which was called after President Pervez Musharraf resigned on Aug. 18.
Pakistan has only $6 billion in foreign exchange reserves, disappearing at the rate of close to $2 billion each month to pay for oil and food. Several prominent economists and businessmen interviewed said much investor nervousness stems from mistrust of Zardari, who served as minister of investment in Bhutto's government when it was accused of demanding illicit payments in return for deals that exceeded the accepted levels of corruption in Pakistan.
Two recent decisions by Zardari showed a disregard for Pakistan's alarming deficits, they continued, insisting on anonymity because they did not want to speak out publicly against the next president.
In April, Zardari told the then-finance minister, Ishaq Dar, that he wanted the price the government paid farmers for wheat to be raised substantially as a way of rewarding an important constituency in the province of Punjab, according to two participants in the discussion who feared repercussions if they used their names. The government would then have to heavily subsidize the cost of wheat to the consumer.
When Dar asked Zardari how he thought the government would pay for the subsidy, Zardari replied: "Print the notes," according to the two participants, a government official and an associate of Zardari's. In an effort to solve the impasse over the cost of the subsidy, it was suggested that Zardari form a committee of experts. "I am the expert," Zardari replied, his associate said.
The two also described an incident in May as the budget was being prepared. Zardari decided to scrap a proposed capital gains tax after a visit from a group of influential stockbrokers from the Karachi stock exchange, they said.
The revenue from the capital gains tax and from an income levy tax proposal on the rich would have paid for an income support program for the poorest Pakistanis, they said. More than 50 percent of Pakistanis live on less than $2 a day, according to the World Bank.
In Zardari's defense, the finance minister, Naveed Qamar, said this week that political stability would be restored to Pakistan once Zardari was president and that the unsettled economy would benefit from the new political order.
Others were not so sure. "Zardari will wield unprecedented power for a civilian president," said Maleeha Lodhi, who was appointed as Pakistan's ambassador to the United States by Bhutto and then by Musharraf. "But he may lack authority in view of his checkered and controversial past."
Washington is trying to persuade Pakistan to take a stronger stance against the militants who are using the northern tribal areas as a sanctuary to attack U.S. and NATO forces in Afghanistan. Despite their reservations, U.S. officials prefer Zardari to Sharif because they believe Zardari's Pakistan People's Party to be more secular and liberal than Sharif's party and more likely to confront militants.
http://www.iht.com/articles/2008/09/05/asia/pakistan.php

Aid to poor nations slips as need becomes more acute

UNITED NATIONS, New York: Aid to poor nations has slumped even as higher food and energy prices and slowing global economic growth have made such assistance more urgent, according to a report released by the UN secretary general, Ban Ki Moon.
The question of how to increase development aid will be the main theme on the sidelines of the General Assembly later this month, with scores of heads of state expected to attend a one-day conference on aid, to be held Sept. 25.
The UN report released Thursday showed that aid dropped 8.4 percent in 2007, after a 4.7 percent drop in 2006. Commitments to help Africa in particular have lagged. The Group of 8 industrialized nations pledged in 2005 to donate more than $25 billion to Africa by 2010, but just $4 billion has actually been delivered.
"We are running out of time," Ban said at a news conference, adding that despite some progress, member states are not meeting their commitments.
Ban organized a task force to quantify the gap between aid goals for 2015, first set out in 2000 and known as the Millennium Development Goals, and what has actually been achieved.

The conclusions listed in the report included:
Just 79 percent of exports from the least developed countries are given duty-free access to developed countries, short of the goal of 97 percent.
Debt relief has been granted to 33 out of 41 eligible countries, canceling more than 90 percent of their external debt. Still, in 2006, 52 countries spent more paying off debts than on public health, and 10 devoted more to debt payments than to education.
The distribution of medicine to combat HIV/AIDS, malaria and tuberculosis has improved, but the supply of affordable drugs remains inadequate.
Huge progress has been made in getting cellphones to developing countries, with signals now available in more than three-quarters of the developing world. But Internet access and other technology lags.
The United Nations wants the richest 22 countries to commit to donating 0.7 percent of their overall national income to aid, but the only countries that have done that are Denmark, Luxembourg, the Netherlands, Norway and Sweden. Most of the aid donors hovered around 0.45 percent, the report said. The United States traditionally devotes a relatively small share of its public wealth to foreign aid.
The Group of 8 committed at a 2005 conference in Gleneagles, Scotland, to increase aid by $50 billion, but the nations are still $31.4 billion short, the report said.
The Millennium Development Goals were regarded as unrealistic targets when they were first introduced, but in the ensuing eight years they have become the framework by which both developing and developed nations set their priorities on aid.
Development experts credit the goals with helping to broaden access to primary education and health care. But some critics argue that the United Nations has emphasized the need for more money rather than the need to allocate existing resources more efficiently.
http://www.iht.com/articles/2008/09/05/africa/poor.php