Hired Guns and Mercenaries

We are told that the corporation once known as Blackwater changed its name to Xe Services, and is now called ACADEMI, but we have no real idea what internal changes in stock ownership or underlying capital actually occurred. A recent blog has opined that there seem to be links between the news owners of ACADEMI (formerly Blackwater) and Mitt Romney financial supporters.

Nevertheless, persons who were previously executives or directors of Blackwater have formed other companies with sometimes less than voluntary financial support. James F. Smith is a notable example. Through leaked emails written to the "Texas-headquartered 'global intelligence' company Stratfor," most important of which to WikiLeaks was, of course, relevant to Julian Assange's prosecution, we have we have received a glimpse into "Stratfor’s web of informers, pay-off structure, payment-laundering techniques and psychological methods." WikiLeaks elaborates further about this network, calling it a:

revolving door that operates in private intelligence companies in the United States. Government and diplomatic sources from around the world give Stratfor advance knowledge of global politics and events in exchange for money. The Global Intelligence Files exposes how Stratfor has recruited a global network of informants who are paid via Swiss banks accounts and pre-paid credit cards. Stratfor has a mix of covert and overt informants, which includes government employees, embassy staff and journalists around the world. The material shows how a private intelligence agency works, and how they target individuals for their corporate and government clients.

From one source who has an "extensive record of sharing intelligence with Stratfor," we have recently learned that SCG International, "a government-contracted private security firm is helping the Syrian opposition to overthrow the Bashar al-Assad regime." Upon closer examination, we then discover the source of the Stratfor intelligence was none other than:

Jamie Smith, left

SCG Chief Executive James F. Smith, who used to be director of notorious company Blackwater, now known as Academi. In a separate message Smith introduces himself to Stratfor as having background in CIA and heading a company “comprised of former DOD, CIA and former law enforcement personnel.”

In a story appearing in online edition of RT (Russia Today) dated March 21, 2012, it was stated:

The US has been increasingly dependent on private contractors like SCG, outsourcing functions to them that were previously fulfilled by regular troops. Employees of these “modern mercenaries” provide services like personal and area security, intelligence gathering and recruit training in countries like Iraq and Afghanistan.

Critics of the practice say such firms lack accountability and allow the government to carry out “black op” tasks while being able to deny any involvement.

From his photograph, Jamie Smith looks like a mere youngster, but he is a popular subject for interviews on television "news" shows like MSNBC, CNN and America Now. 

What these news shows don't tell us, however, is how Jamie got the funds for his private company. We have to go to a local news outlet based in Virginia to learn that. We discover from Bill Sizemore's story in The Virginian-Pilot that there are two people very unhappy with James Frank Smith, Jr.-- Craig Sanford and his wife, Mary Jo, of Morrisville, Pa.--who filed suit in the fall of 2010 against Smith's corporation, SCG, alleging they had been defrauded of $12.5 million. Sizemore also relates that Smith's degree came, not from Harvard, as some have claimed, but that he graduated in the class of 2000 from the much less impressive

Regent University in Virginia Beach, the evangelical school founded by Pat Robertson. And the Navy has no record of him serving. He does appear to have once worked for the CIA, although that is difficult to verify. The CIA does not publicly confirm or deny employment. The Mississippi-born Smith first came to Virginia on assignment to Camp Peary, the CIA's training base near Williamsburg, he told The Pilot in 2003. Later, he was a vice president at Blackwater, the Moyock, N.C.-based security firm, in its early years. He left in 2002 under circumstances that neither he nor Blackwater, since renamed Xe, would discuss on the record.

The article proceeds to tell us about how the "loan" commenced:

Craig Sanford met Smith in 2007 shortly after reaping a financial windfall from the sale of a medical waste hauling business, according to the lawsuit. Smith is said to have portrayed himself as a successful entrepreneur in the security business with "a unique ability to invest funds overseas." Smith is alleged to have guaranteed Sanford a 10 percent annual return on his money, whereupon Sanford turned over $12.5 million in return for a promissory note signed by Smith. Over the ensuing months Sanford received periodic reassuring updates on his investment. But he began to get nervous.

The writer did not elaborate over any collateral or other documentation for the loan, but only that many assurances were made to the Sanfords that the money was safe, such as this one from Jamie's associate in March 2008:

The money is invested in numerous places, foreign and domestic and is being managed by qualified, competent fund managers. Jamie is a wizard so no worries there. He graduated from harvard with honors and I trust him with my kids life.

Of course we know what happened in October 2008--the Dow collapsed. Six months later Sanford, who was already worried, became frantic when "SCG's attorney called with the news that his money had been 'lost in the stock market.' "

But what is far from clear from Sizemore's article is why the $12.5 million turned over to Jamie Smith, which he characterized to a friend as "a gift from God," is called a "loan" that the borrower is unable to pay "on the schedule originally contemplated." What were the terms set out in the promissory note? Was it really a loan or a money management agreement?

Sanford's attorney,  J. Chapman Petersen, a Democratic state senator from Fairfax County, was quoted as saying,

"All I can tell you is, my client had $12.5 million that he gave to this fellow to be invested, and it disappeared....It's a very strange case - that this large amount of money could just walk off like that." (See a copy of the lawsuit, filed under Case 1:10-cv-009-GBL-IDD.)

Shortly after finishing law school, Smith got a job with a law firm in Flowood, Mississippi--Barnes, Broom, Dallas and McLeod--some of whose partners and associates appear in a directory of Mississippi tax attorneys, but from which directory Smith's name is noticeably absent. Instead, his name now appears on emails published by WikiLeaks about an ever increasingly frightening national security state being conducted by hired guns and mercenaries like Jamie Smith.

IGNORANCE IS STRENGTH

"Transparency should be proportional to the power that one has. The more power one has, the greater the dangers generated by that power, and the more need for transparency. Conversely, the weaker one is, the more danger there is in being transparent....We're not promoting transparency.  Only the transparency of the most powerful organizations."

Quote from Julian Assange, Paris Match, 12/23-29/2010, translation.

Julian Assange expressed in his recent interview one of those strange paradoxes of truth that many find to be impossible to grasp. When questioned by Paris Match last December he consistently reframed the questions presented to him. Told that he has avoided transparency while calling for it in others, he countered: "We're not promoting transparency.  Only the transparency of the most powerful organizations."  When WikiLeaks was then called "a powerful organization," he forcefully declared, "That's absurd!" While he admitted members of his organization show great courage, he denied that having courage gives one power.

So how can we define power?

Knowledge is power, said the philosopher Francis Bacon. And conversely, power is knowledge -- and more relevantly -- the witholding of knowledge. Even more than its intrinsic violence, the real scandal of power lies in its secrecy....

The central element [of WikiLeaks] is the possibility that everyone can know the moves and action of those people in power....

[Source: Edoardo Acotto, "Assange: The Power of Secrecy," Vogue Italia (12/09/2010)]

It's impossible not to see the irony implicit in the struggle that is now going on between the Western governments, which for so long have been fighting authoritarian governments throughout the world, and this one organization which is intent on exposing the hypocricy of the leaders these so-called democratic nations. There's no better way to illustrate that hypocrisy than by a comparison of the reality with the fiction created by author George Orwell. 

Orwell wrote an essay in 1946 about his Second Thoughts on James Burnham, in which he analyzed Burnham's writings as follows:

What Burnham is mainly concerned to show is that a democratic society has never existed and, so far as we can see, never will exist. Society is of its nature oligarchical, and the power of the oligarchy always rests upon force and fraud. Burnham does not deny that ‘good’ motives may operate in private life, but he maintains that politics consists of the struggle for power, and nothing else. All historical changes finally boil down to the replacement of one ruling class by another. All talk about democracy, liberty, equality, fraternity, all revolutionary movements, all visions of Utopia, or ‘the classless society’, or ‘the Kingdom of Heaven on earth’, are humbug (not necessarily conscious humbug) covering the ambitions of some new class which is elbowing its way into power.

The English Puritans, the Jacobins, the Bolsheviks, were in each case simply power seekers using the hopes of the masses in order to win a privileged position for themselves. Power can sometimes be won or maintained without violence, but never without fraud, because it is necessary to make use of the masses, and the masses would not co-operate if they knew that they were simply serving the purposes of a minority. In each great revolutionary struggle the masses are led on by vague dreams of human brotherhood, and then, when the new ruling class is well established in power, they are thrust back into servitude. This is practically the whole of political history, as Burnham sees it.

Orwell almost plagiarized from his own essay about Burnham's thesis when he wrote a fictional treatise within the novel, 1984, published three years later. Written by Oceana's arch-enemy Emmanuel Goldstein (not unlike today's hated Osama bin Laden), "The Theory and Practice of Oligarchical Collectivism" details the history of class war that led up to the oligarchic rule by a managerial class of accountants, engineers and bankers:

Throughout recorded time, and probably since the end of the Neolithic Age, there have been three kinds of people in the world, the High, the Middle, and the Low. They have been subdivided in many ways, they have borne countless different names, and their relative numbers, as well as their attitude towards one another, have varied from age to age: but the essential structure of society has never altered. Even after enormous upheavals and seemingly irrevocable changes, the same pattern has always reasserted itself, just as a gyroscope will always return to equilibrium, however far it is pushed one way or the other.

The aims of these three groups are entirely irreconcilable. The aim of the High is to remain where they are. The aim of the Middle is to change places with the High. The aim of the Low, when they have an aim--for it is an abiding characteristic of the Low that they are too much crushed by drudgery to be more than intermittently conscious of anything outside their daily lives--is to abolish all distinctions and create a society in which all men shall be equal. Thus throughout history a struggle which is the same in its main outlines recurs over and over again. For long periods the High seem to be securely in power, but sooner or later there always comes a moment when they lose either their belief in themselves or their capacity to govern efficiently, or both. They are then overthrown by the Middle, who enlist the Low on their side by pretending to them that they are fighting for liberty and justice. As soon as they have reached their objective, the Middle thrust the Low back into their old position of servitude, and themselves become the High. Presently a new Middle group splits off from one of the other groups, or from both of them, and the struggle begins over again. Of the three groups, only the Low are never even temporarily successful in achieving their aims. It would be an exaggeration to say that throughout history there has been no progress of a material kind. Even today, in a period of decline, the average human being is physically better off than he was a few centuries ago. But no advance in wealth, no softening of manners, no reform or revolution has ever brought human equality a millimetre nearer. From the point of view of the Low, no historic change has ever meant much more than a change in the name of their masters. 

 

Goldstein's chapter entitled, appropriately enough, "Ignorance Is Strength," then proceeds to enlighten its readers with the truth about how advanced technology had ended the turnover of the existing elite ruler class by another, and how that stability could only be maintained by perpetual war and by hiding the truth to the point that all those below the ruling class were fed and forced to accept a constant stream of lies.

As for the problem of overproduction, which has been latent in our society since the development of machine technique, it is solved by the device of continuous warfare, which is also useful in keying up public morale to the necessary pitch. From the point of view of our present rulers, therefore, the only genuine dangers are the splitting-off of a new group of able, under-employed, power-hungry people, and the growth of liberalism and scepticism in their own ranks. The problem, that is to say, is educational. It is a problem of continuously moulding the consciousness both of the directing group and of the larger executive group that lies immediately below it. The consciousness of the masses needs only to be influenced in a negative way. 

Going back to Orwell's essay on Burnham, he says:

Burnham has probably been more right than wrong about the present and the immediate past. For quite fifty years past the general drift has almost certainly been towards oligarchy. The ever-increasing concentration of industrial and financial power; the diminishing importance of the individual capitalist or shareholder, and the growth of the new ‘managerial’ class of scientists, technicians, and bureaucrats; the weakness of the proletariat against the centralised state; the increasing helplessness of small countries against big ones; the decay of representative institutions and the appearance of one-party régimes based on police terrorism, faked plebiscites, etc: all these things seem to point in the same direction. Burnham sees the trend and assumes that it is irresistible, rather as a rabbit fascinated by a boa constrictor might assume that a boa constrictor is the strongest thing in the world.

As one jumps back and forth between these two works Orwell produced in the last four years of his life, it becomes increasingly apparent that he had identified James Burnham's expressed ideals as those by which the State, personified as Big Brother, ruled Oceania.

For this reason if no other, it is important to know who James Burnham was. We'll save that for another day.