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VIX surges while SPX remains steady: What’s behind the anomaly?

The financial world relies heavily on indicators to gauge market sentiment and predict future trends. Among these, the Volatility Index, commonly known…

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The financial world relies heavily on indicators to gauge market sentiment and predict future trends. Among these, the Volatility Index, commonly known as the VIX, stands out as a prominent measure of market anxiety.

Originating from the Chicago Board Options Exchange, the VIX is an index that represents the market’s expectation of 30-day forward-looking volatility. Calculated from the implied volatilities of a wide range of S&P 500 index options, a high VIX typically signals heightened investor fears, while a low reading suggests a calm market.

On the other hand, the S&P 500 Index, or SPX, serves as a beacon for the overall health of the U.S. stock market. Comprising 500 of the largest U.S. companies by market capitalization, its movements are watched closely by traders, analysts, and institutional investors alike. Historically, the VIX and the SPX have shared an inverse relationship: as the SPX rises, indicating bullish sentiment, the VIX usually decreases, suggesting reduced market anxiety, and vice versa.

Yet, recent market data paints an unusual picture. Over 3 months, the SPX witnessed a decline of 3.37%, a clear indication of some bearish sentiment. However, the VIX skyrocketed during the same period, increasing 38.41%.

Graph showing the divergence between VIX and SPX from Jul. 12 to Oct. 13, 2023 (Source: TradingView)

This divergence is also observed in a narrower 1-month window: the SPX declined by 3%, while the VIX surged by 32.8%.

VIX-SPX-1MO
Graph showing the divergence between VIX and SPX from Sep. 12 to Oct. 13, 2023 (Source: TradingView)

The discrepancy on Oct. 13 was even more pronounced — in just a single trading day, the VIX jumped by an alarming 13.54%. Meanwhile, the SPX, rather than reflecting this spike in volatility, remained almost unchanged, registering a mere 0.82% dip.

vix spx 1-day increase
Graph showing the divergence between VIX and SPX between Oct. 12 and Oct. 13, 2023 (Source: TradingView)

This stark divergence prompts questions. Several factors could be contributing to this anomaly. Firstly, the market might be anticipating significant future movements in the SPX that aren’t yet reflected in its current value. Secondly, external events or geopolitical tensions could impact market derivatives more than the cash market, leading to an exaggerated VIX. Lastly, structural changes or shifts in market dynamics and participants could alter the traditional relationship between the two indices.

For investors and market participants, such discrepancies are cause for vigilance. While the VIX’s primary role is to measure market sentiment, its current dislocation from the SPX may indicate underlying market stresses or potential forthcoming volatility. Traders might interpret this as a sign to hedge their positions or prepare for potential market swings.

The post VIX surges while SPX remains steady: What’s behind the anomaly? appeared first on CryptoSlate.

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RFK Jr: The Wuhan Cover-Up & The Rise Of The Biowarfare-Industrial Complex

RFK Jr: The Wuhan Cover-Up & The Rise Of The Biowarfare-Industrial Complex

Authored by Debbie Lerman via The Brownstone Institute,

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RFK Jr: The Wuhan Cover-Up & The Rise Of The Biowarfare-Industrial Complex

Authored by Debbie Lerman via The Brownstone Institute,

The Wuhan Cover-Up and the Terrifying Bioweapons Arms Race (Skyhorse Publishing, December 3, 2023) is a crucial book for understanding how the Covid catastrophe happened. 

I would even go so far as to argue that RFK, Jr.’s new book is the most important Covid chronicle to date, although it ends at the beginning of 2020, before most of us were even aware that a “novel coronavirus” was circulating among us. 

The book explains the CAUSES of the global disaster, which all happened before March 2020. Everything after that are the downstream EFFECTS of what The Wuhan Cover-Up exposes.

Here’s how RFK, Jr. summarizes those effects:

Everyone has now seen that pandemics are another way for the military, intelligence, and public health services to expand their budgets and their power. In 2020, public health, defense, and intelligence agencies weaponized a [Covid-19] pandemic, resulting in unprecedented profits to Big Pharma and the dramatic expansion of the security/surveillance state, including a systemic abandonment of constitutional rights—effectively a coup d’état against liberal democracy globally.

(Kindle edition, p. 385)

Putting Covid in the Biowarfare Context

Interestingly, in the publicity blurb on the book and in interviews about it, RFK, Jr. focuses on “the etiology of the gain-of-function research” and everything that led up to a virus being engineered in a US-funded lab in Wuhan by a group of Chinese and Western scientists.

At the core of this story is RFK, Jr.’s desire to warn readers about the dangers of gain-of-function research, which he shows in the book to be irrefutably a biowarfare – not a public health – endeavor.

But in the process of constructing the argument and supplying the proof for his dire warning, and for his assertion that this type of research should be stopped immediately and forever, RFK, Jr. provides what I find to be an even more compelling story.

The story in the Wuhan Cover-Up that interests me is the rise of the biowarfare-industrial-complex – the global behemoth comprising military/intelligence alliances, Big Pharma, Big Tech, academic and medical institutions, and NGOs – that both created the virus known as SARS-CoV-2 and ran the global response to it.

In this article, I will highlight key parts of The Wuhan Cover-Up that pertain to this storyline – which I believe are downplayed in its publicity materials and are one of the main reasons it has been practically banned from polite society: The book has been so heavily censored that I cannot find a single actual review on Google. Newsweek reported that independent bookstores do not want to carry it. 

A lot of the censorship has to do with mainstream animosity toward RFK, Jr’s presidential campaign. But the explosive content of the book, as reviewed in this article, is also likely a factor.

Top-Level Summary of the Rise of the Biowarfare Industrial Complex, as Told by RFK, Jr.

  • The biowarfare industry started to grow after WWII, when Western intelligence agencies imported Japanese and German scientists to help develop weapons against Communist enemies. This was, in fact, the first task of the newly formed CIA.

  • After 9/11, funding for bioweapons research exploded, and so did the power and reach of the military and intelligence agencies in charge of such research. The research, presented to the public as “pandemic preparedness and response (PPR),” encompassed mostly attempts to engineer deadly pathogens and simultaneously to create countermeasures to them, predominantly vaccines. 

  • So much money was pouring into PPR/bioweapons research that the public health agencies and academic institutions involved in government research all became dependent on it – or, perhaps more accurately, addicted to the money and power this type of research bestowed. Multinational public-private partnerships and “non-governmental organizations” (e.g., The Bill & Melinda Gates Foundation and The Wellcome Trust) were created to fund and promote the need for such research.

  • In the fall of 2019 an engineered pathogen from one of the bioweapons labs in China found its way into the population. All the military, intelligence, and public health officials from China, the US, UK, and other countries, with their pharma and academic partners, conspired to cover up the lab leak, while simultaneously preparing to unleash their countermeasures on the world.

How the Nature of Biowarfare Research Has Not Changed

As RFK, Jr. tells it, the history of today’s biowarfare industry starts after WWII, when German and Japanese scientists were secretly repatriated to assist the intelligence community and military in developing chemical and biological weapons programs. 

It is no coincidence, he argues, that many sinister features of those earlier programs carried forward to the present. These features include:

  • tight alliances with the pharmaceutical industry and the media; 

  • the complicity of academia and medical schools; 

  • the co-opting of journals; 

  • intense secrecy; 

  • pervasive experimentation on human subjects; 

  • liberal use of the word “volunteers;”

  • open-air testing on large unwilling populations; 

  • ethical elasticity; 

  • the normalization of lies; 

  • the use of microbiology to alter and weaponize bugs; 

  • the use of vaccine development as a mask for bioweapons research; 

  • the corruption of the entire medical establishment 

(p. 48)

Even just this list is enough to explain what happened with Covid: Take all these ingredients, add billions of dollars and multinational public-private partnerships involving top research institutions and thousands of scientists, and how could you not get a global disaster? 

Deep CIA-Biowarfare Ties

The Wuhan Cover-Up spends a lot of time documenting the correspondence between the rise of the CIA and the emergence of the modern biowarfare program. 

 RFK, Jr. writes:

…it’s worth reviewing the agency’s seventy-five-year preoccupation with bioweapons, pandemics, and vaccines. Bioweapons development was the CIA’s first love, and has remained its relentless passion. The CIA’s natal obsession with bioweapons pitted the agency against all the idealistic underpinnings of both American democracy and the healing arts of medicine. 

(p. 46)

An important related point emphasized in the book is that bioweapons research is not an obscure, niche industry. Rather, according to The Wuhan Cover-Up, it is a top national defense concern, driving the national security agenda:

Following the collapse of the Soviet Union, the military and intelligence apparatus erected the biosecurity agenda as the new spear tip of American foreign policy. These agencies deftly replaced the fear of the Soviet monolith and creeping communism with a fear of infectious disease, which they have successfully stoked to justify vast expansions in power…

(p. 44)

Shockingly Broad Participation by Academics and Scientists

Because the biosecurity agenda – which focuses on biochemical and medical research – is so central to foreign policy and national security, it controls large swaths of research funding. Thus, as RFK, Jr. documents, it has come to encompass many top academic institutions and thousands of doctors and scientists:

Among the most alarming side effects of the federal preoccupation with bioweapons has been the systematic diversion of vast resources and armies of academic and government scientists away from public health and healing. 

(p. 46)

Today, some thirteen thousand death scientists labor on bioweapons technology on behalf of US military, intelligence, and public health agencies in some four hundred government and university bioweapons labs. 

(p. 83)

Moral Bankruptcy

When faced with Covid “conspiracy theories” – such as those put forth in The Wuhan Cover-Up – people often argue that so many doctors and scientists could not possibly have knowingly agreed to civilization-killing ideas like lockdowns and injections of unsafe medical products into billions of people. They must have believed they were actually saving humanity, right?

Wrong, according to RFK, Jr.:

History has shown again and again the bioweapons agenda’s awesome power to transform compassionate, brilliant, idealistic doctors into monsters. 

(p. 47)

They have, as a class, demonstrated thoroughly warped judgment and a reliable penchant for dishonesty and terrible ideas. 

(p. 87)

Bioweapons Research = Vaccine Research

Another crucial idea bearing on our understanding of the Covid response is that vaccine research is a primary concern for the biowarfare-industrial complex, although it is publicly presented as a public health endeavor.

The book quotes Professor Frances Boyle, author of the Biological Weapons Anti-Terrorism Act of 1989, with this explanation:

You can’t use a bioweapon against your enemy without having in your possession an antidote with which to shield your own team from blowback. For this reason, bioweapons and vaccines are always developed in tandem with each other.

(p. 121)

Moreover, because vaccine research funding goes to both biodefense and public health agencies, they have become inextricably linked:

The military and public health agencies work in close coordination to develop vaccines for military applications, sharing information and working side by side in labs. Vaccine research often serves as a cover or rationale for illegal bioweapons development.

(p. 129)

From an Obsession of US National Security to a Tool of Globalism

As RFK, Jr. writes, after 9/11, Islamic terrorism became the focus of US national defense. After the anthrax attacks, the focus of antiterrorist activities coalesced around the need to predict, prevent, and create countermeasures to biological terrorism. 

This more reliable and terrifying enemy would soon replace the war against Islamic terror—justifying a “forever war” against germs. “Biosecurity,” a.k.a. Pandemic Preparedness and Response (PPR), provided a rationale for US presence in every developing nation.

(p. 149)

And, as further explained by RFK, Jr., the focus on bioterrorism, which first served the American imperialist impulse, then became incorporated into the program of globalism:

The emerging medical/military-industrial complex would soon be citing biosecurity as a pretext for centralized control, coordinated response among nations, a sprawling construction project for new US bioweapons laboratories, the archiving of every germ with weapons potential under the pretext of pandemic protection, the control of the media, the imposition of censorship, the erection of an unprecedented surveillance infrastructure ostensibly needed to “track and trace” infections, universal digital IDs, digital currencies to reduce disease spread, and the ceding of power by national governments to the WHO—in short, globalism. 

(p. 149)

China Becomes a Dominant Biowarfare Research Player

Concurrently, China’s leaders were working on a mission to make China a world leader in science, research, and innovation. According to The Wuhan Cover-Up, the Chinese have been using the West’s march toward globalism to infiltrate “Western academia, businesses, media, cultural groups, and government agencies that speak the language of cooperation, globalism, and public health.” (p. 257)

As part of their infiltration process, the Chinese lavished funding on Western research institutions and scientific publishing houses. And because biomedical/biowarfare research was so central to Western governments and research institutions, the Chinese were able to eventually dominate that space as well.

Thus, the book explains, China was able to “co-opt US academic institutions and US public health agencies into performing backdoor bioweapons research for the Chinese military.” (p. 274)

Why Would the US Do Bioweapons Research in/for China?

This is, perhaps, the most oft-raised question in response to the hypothesis that SARS-CoV-2 was an engineered bioweapon from a lab funded by the Chinese military, the US, and other Western governments.

As RFK, Jr. explains, with the Chinese as major funders of Western institutions, journals and projects related to biomedical research, this strange collaboration was not just unsurprising, but in fact, inevitable:

The Chinese campaign to co-opt leading scientists and the river of Chinese funding to researchers at US and British medical research universities and to the leading scientific journals had, by then, bought China powerful friends across the Western scientific establishment. 

(p. 280)

Furthermore, the interests of China intersect with the interests of major global corporations and NGOs that comprise the biowarfare-industrial-complex – many of which enriched themselves considerably through the Covid response. As RFK, Jr. writes:

There is a natural intersection of interests between Western business titans and a former communist government [the Chinese Communist Party] that has made itself the global model for seamlessly merging corporate with government power, and promoting business growth by suppressing democracy, labor, and human rights. 

(p. 572)

For its part, the US intelligence community has all kinds of reasons – all ultimately geared toward increasing its own power and influence – to engage in sensitive scientific research projects with the Chinese:

The deliberate transfer of our superior bioweapons knowledge to the Chinese—a potential enemy—makes little sense to citizens who think in terms of conventional rivalries between nations. Espionage was clearly among the complex motivations for the US intelligence community supporting Chinese bioweapons research in China. Knowing what the Chinese are up to is the mission of the US intelligence community. But quietly sharing cutting-edge technologies may also serve institutional self-interest. After all, the intelligence community expands its power by reporting the enemy’s expanding capabilities; more frightening capabilities abroad justify increased budgets and increased power at home. 

(p. 388)

Bioweapons expert Dr. Francis Boyle is quoted stating that:

Opportunities to expand institutional power and corporate profits always seem to trump patriotism and duty within the CIA’s bioweapons teams. Patriotism is a polite fiction among the bioweapons set.

(p. 383)

RFK, Jr. adds that the public health agencies, which are heavily involved in, and funded by, biowarfare research, share the CIA’s self-interested non-patriotism:

NIH and NIAID operate under the same perverse incentives that drive destructive conduct across the whole bioweapons field.

(p. 383)

A Convergence of Personal, Political, Financial and Global Interests

In the final chapters of The Wuhan Cover-Up, RFK, Jr. focuses on several key figures in the biowarfare-industrial-complex, including Jeremy Farrar of the Wellcome Trust (now at the WHO), Anthony Fauci of the NIH, and Bill Gates. 

RFK, Jr. uses these figures to show how the Covid pandemic emerged from the toxic stew of ethically compromised biowarfare research standards; military, intelligence, public health, and academic institutions/organizations dependent on biowarfare funding; the involvement of China and global interests in the booming business of “pandemic preparedness and response;” and, of course, the endless pursuit of political power and personal enrichment.

Here’s a great summary of how they all came together, through personal and institutional greed and power-mongering, to unleash the Covid catastrophe on the world:

The evidence suggests that instead of relentlessly protecting public health, Farrar exploited the pandemic to promote the venal financial agendas of his WEF [World Economic Forum] patrons, to transform Western democracies into surveillance states, to expand his personal power and paycheck, and to pander to high-level Chinese officials. Achieving these objectives required Farrar to hide [Covid’s] laboratory origins, a project in which he enlisted a cadre of his medical cartel cronies—those who, thanks to years of funding by Fauci, Farrar, and Gates, now occupy the highest echelons of virology in academia, the regulatory agencies, and pharmaceutical companies. 

(p. 539)

If for nothing else, I would recommend adding The Wuhan Cover-Up to your library as an invaluable resource on leading figures, organizations, and power brokers involved in the biowarfare-industrial-complex.

Conclusions and Comments

It was especially gratifying to me to read The Wuhan Cover-Up (all 600 pages of it), because it validated my own research, showing that the pandemic response was led by the national security/intelligence arms of government, not public health agencies. 

In fact, after reading the first few chapters – the ones that go into the history of chemical and biological warfare and the rise of the biowarfare-industrial-complex – I paradoxically felt an enormous sense of relief. 

Finally, we have a detailed account that shows – beyond what I would consider a reasonable doubt – that the entire Covid catastrophe was caused, and led, by a multinational military-intelligence-academic-pharma-tech-NGO cabal.

RFK, Jr.’s conclusion is that we should look to a future “in which the bio-elites are held responsible for their actions, people regain their rights, and the Constitution is restored to its intended preeminence.”

But how do we do that? 

I am afraid, based on the information in his own book, and the fact that RFK, Jr. himself is being censored and banned so extensively from the public square, that the solution to the problems he exposes is much more difficult and complex than just “holding the bio-elites responsible” which will somehow lead to people regaining their rights.

What we need to do is to shut down, or extract ourselves from, the global biowarfare-industrial-complex that is able to convince (or coerce?) our governments into declaring states of emergency over supposed pandemic threats, and then curtail civil rights and impose massive surveillance, censorship, and propaganda that would not be permitted in non-emergency situations. Not to mention garnering enormous wealth while forcing the world’s population to accept novel, untested, and potentially lethal medical “countermeasures.”

The Wuhan Cover-Up does a better job than any other book or article I have read at exposing the trends, forces, and institutions that brought us the Covid catastrophe – with hundreds of pages of notes and references. What’s frightening is that the enormity of the problem is beyond the scope of the book, not just to solve, but even to fully acknowledge.

Republished from the author’s Substack

Tyler Durden Fri, 02/16/2024 - 23:40

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How Progressive Policies Are Designed For Civilizational Suicide

How Progressive Policies Are Designed For Civilizational Suicide

Authored by John D. O’Connor via American Greatness,

We all understand,…

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How Progressive Policies Are Designed For Civilizational Suicide

Authored by John D. O'Connor via American Greatness,

We all understand, in the timeless words of the poet Robert Burns, that the best laid plans of mice and men often go awry.

Most Americans are accustomed to assessing the various failed initiatives of our country’s leaders as well-intended actions that turned out badly. The Vietnam, Afghan, and Iraq wars, the 2008 financial meltdown, and the COVID pandemic overreaction, all in hindsight, can be viewed as simply the unfolding of human stupidity in the contingency of time.

In accordance, it is understandable that many are inclined to believe that our country’s current serious problems are, once again, merely the failed result of well-intentioned policies.

But what if, we ask, seemingly fumbled programs were intended to be the initial throes of civilizational suicide? What if apparent missteps were actually directed at the purposeful destruction of a prosperous, free, safe, and secure society?

As we examine the policies pushed by the Biden administration progressives regarding climate, national security, crime, and the border, we can rationally conclude that they are being purposely implemented to render our society unsuccessful, not successful, in its traditional aims, causing what could be the ultimate destruction of a thriving, liberal enlightenment society.

Let us begin with escalating climate mandates, now reaching gas stoves and tires, seeking the total elimination of fossil fuels. Because our mainstream media, more out of reflexive conformity than malevolence, constantly amplify climate alarmism, most Americans believe climate programs are designed in good faith to protect us from planetary disasters. Climate subsidies are aimed, they are led to believe, at increasing prosperity through good “green” jobs in emerging “green” industries, all part of the supposedly improved “Bidenomics” economy, however counterintuitive many think them to be.

When Biden, immediately upon assuming office, stopped issuing new drilling leases, canceled the Keystone Pipeline, and issued EPA regulations effectively shutting down multiple power plants in the near future, was he, however idealistically, trying to wean our country off of fossil fuels in favor of clean, “renewable” energy? If so, what could be wrong with that?

If the administration had calculated that lost energy from stifling fossil fuel sources could actually be replaced, these initiatives, even if overly optimistic, could be viewed as well-intended.

However, within the climate camp, it has been well known that fossil fuels, which power 82% of world energy needs, cannot conceivably be replaced by renewable energy to any substantial degree. So, as these policies take effect over the coming years, our hospitals and medical centers, relying on petroleum-based plastic furniture, fixtures, and equipment, energy-dependent stainless-steel implements, and high-power physical plants, will be hit hard. Health care costs will soar, while treatment will decrease to emerging society levels. Our food costs, already rising dramatically, will skyrocket as petroleum fertilizer, now tripling yields, becomes economically impractical. Housing costs, dependent on fuel-powered equipment and concrete and steel needing massive energy inputs to manufacture, will put homeownership out of reach for all but the rich and reduce housing to cramped, third-world levels. And, of course, transportation will become an expensive luxury for both people and products.

But isn’t this all meant well? For trusting, uncritical moderates and traditional liberals, yes. For the progressives pulling the strings, no.

Maurice Strong, the Canadian socialist responsible for steering the United Nations into the bureaucratic sinecures of the climate alarmist IPCC, has stated from the outset that his intention is the diminishment of the wealth of the Western industrialized nations, making them more like less-advantaged societies.

Although they tout their certainty, climate warriors conceal that for decades, their computerized GCMs (General Circulation Models) have overpredicted global warming by 300%. Well, they respond when confronted by the knowledgeable, the increased heat was swallowed by the oceans, or perhaps tamped down by those pesky aerosols. They know better, but gullible, well-intentioned believers do not.

Documents from a key IPCC research center in East Anglia, the GRU, reveal the fear of climate activists that the public will learn of the Medieval Warm Period and that its temperatures were warmer than today without any claimed assistance from carbon dioxide. Progressive climatologists, in essence, know they are pushing a canard.

Progressive border policies need little discussion. When Biden was elected, the country was led to believe that he would aim to control the southern border, but do so in a humane, non-Trump manner, no longer putting children in cages (which in truth and in fact were Obama-inspired).

Of course, to any rational observer, it is now clear that the massive invasion at our southern border was intended by progressives. The “great replacement” theory is not needed to prove this invasion intentional, obvious to any observer. Three-star New York hotels and thousand-dollar-a-month payments to migrants? Free health care? These are among the positive incentives to illegally migrate, revealing intentionality after the maligned Trump proved that the border was substantially controllable.

The intended result of mass migration is not just new Democratic voters; the most obvious result. It is, more significantly, a deliberately overwhelming burden on our social welfare system, heretofore supported sufficiently by taxes on a powerful economy. With more unemployment and more burdens on social welfare, the progress of the aspiring poor, primarily minorities, will be crushed. Our society is headed, as intended by progressives, to socialism, which, as Winston Churchill noted, has “as its greatest virtue the equal sharing of misery.”

Moving to national security, the tinderbox of the Middle East was not caused by Trump’s irrational temperament, which, in hindsight, has proven its deterrent value. Rather, putting Obama’s progressive policies on steroids, Biden both directly sent cash to Iran and also removed oil sanctions, giving the country financial power to fund Hamas, Hezbollah, the Houthis, and, of course, Iran’s own depredations on U.S. troops. Biden’s special Iran envoy, the pro-Hamas Rob Malley, and other pro-Iran and pro-Hamas officials influence our Middle East policy to intentionally favor our enemies.

But what could be the progressive motive for Iran’s hegemony in the Middle East? Clearly, it is to cause the demise of “right-wing” leadership in Israel, Saudi Arabia, and Egypt, all American allies, so that the region will be controlled by anti-American repressive regimes. Interestingly, progressives revealed their anti-democratic, authoritarian roots by supporting Mullahs who kill members of the LGBT community and subdue women. Again, Iran’s terrorism is not an unfortunate artifact of balanced statesmanship. Rather, it is intended to exterminate a democratic Jewish society and a Saudi regime seeking to modernize itself. In a remarkable exercise in projection, progressives at the same time deem Trump to be a Hitler stand-in.

Similarly, the cause of increasing crime in our cities is no mystery. Progressives applauded, not decried, the George Floyd mayhem, largely an exercise in looting. Beautiful cities such as San Francisco, Portland, Seattle, and Los Angeles, all run by progressives, have become dystopian hellholes.

So, sincere, well-meaning liberals should, but generally do not, see that they are being led like lemmings to the sea, toward civilizational suicide, by the progressives they have long trusted as being in the liberal leadership, not the socialist vanguard.

In the nineteenth century, the brilliant French observer of American culture, Count Alexis de Tocqueville, said that democratic despotism would be effectuated, if at all, not by overt state terror but by the infantilization of a trusting population.

The evidence is now clearly established that moderate liberals should face reality and reject the policies of the progressive vanguard, leading them into civilizational suicide.

*  *  *

John D. O’Connor is a former federal prosecutor and the San Francisco attorney who represented W. Mark Felt during his revelation as Deep Throat in 2005. O’Connor is the author of the books, Postgate: How the Washington Post Betrayed Deep Throat, Covered Up Watergate and Began Today’s Partisan Advocacy Journalism and The Mysteries of Watergate: What Really Happened.

Tyler Durden Fri, 02/16/2024 - 23:00

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California Counties Could Be Forced To Pay $300 Million To Cover COVID-Era Program

California Counties Could Be Forced To Pay $300 Million To Cover COVID-Era Program

Authored by Travis Gillmore via The Epoch Times,

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California Counties Could Be Forced To Pay $300 Million To Cover COVID-Era Program

Authored by Travis Gillmore via The Epoch Times,

With the state and some local governments facing significant budget shortfalls this year, finances could become even tighter after the Federal Emergency Management Agency, better known as FEMA, informed California officials that it will deny some pandemic-related reimbursement claims.

At issue is money spent on unoccupied hotel rooms and housing homeless individuals for lengthy stays between June 11, 2021, and May 11, 2023, as part of the state’s Project Roomkey program.

The governor’s Office of Emergency Services said it is working to reverse the agency’s decision.

“California is committed to maximizing federal aid to local communities and intends to aggressively advocate for FEMA to rescind the decision to deny Public Assistance to local governments,” Brian Ferguson, deputy director for crisis communications and public affairs for the Office of Emergency Services, told The Epoch Times by email Feb. 14.

More than $300 million is at stake, according to a Jan. 31 letter sent to FEMA by Nancy Ward, director of the emergency services office.

“[We] urge FEMA to rescind the decision to deny public assistance funding ... as it changes the rules for reimbursement of … expenses after such services were provided and directly conflicts with prior FEMA guidance,” Ms. Ward wrote.

The change represents a retroactive revision that failed to meet the emergency management agency’s self-declared notification policies that require a 30-day notice to the state, according to the letter.

Such will result in some counties across California experiencing “financial burdens, budgetary shortfalls,” and a diminished ability to provide essential services, Ms. Ward wrote.

A Project Roomkey participant stands outside her door at The Stanton Inn in Stanton, Calif., on October 8, 2020. (John Fredricks/The Epoch Times)

Documents attached to the letter detail costs that some counties would incur, including $22 million for Ventura, $32 million for Sonoma, and up to $34 million for San Diego. San Francisco submitted claims for approximately $881 million, with $190 million ineligible based on the federal government’s recent decision.

Additionally, the state is alleging that FEMA is inconsistently applying its policies for other states. Officials point to the agency’s April 2023 announcement that Vermont would receive nearly $22 million to reimburse costs for hotel lodging and services to homeless populations through July 2022.

The guidelines presented to California in a letter sent by FEMA in October 2023 represent a reimbursement period of a full year less than is being provided to Vermont, according to the letter.

Disputing the state’s allegations, the agency claimed all states are held to the same standards—with guidance coming from the Centers for Disease Control, also known as the CDC.

“Every state, territory and tribal nation was provided with the same guidance and policy updates throughout the pandemic,” a spokesperson for FEMA told The Epoch Times by email Feb. 13.

“This guidance also included information on transitioning individuals from other programs that could ... keep them out of high-risk situations.”

The agency is reviewing thousands of applications from across the country and is focused on finalizing reimbursement for eligible applicants while maintaining fiscal responsibility, according to the spokesperson.

“FEMA is committed to working with each impacted jurisdiction on all requests for federal funding to maximize reimbursement for the appropriate life saving measures they implemented to protect their citizens from COVID-19, while also ensuring the appropriate oversight of federal funds,” the representative from the emergency management agency said.

“Consistent with this intent, FEMA will review the state of California’s recent letter regarding their COVID-19 sheltering operations and provide a response to the state as soon as possible.”

In the letter informing the state of the agency’s decision to deny claims, Robert J. Fenton, regional administrator for FEMA Region 9—encompassing California—noted the efforts made to reduce COVID transmission by July 1, 2021, as a reason guidance was adjusted at the time.

The agency is willing to cover costs incurred or stays of up to 20 days, the timeline recommended by the CDC said at the time. However, the bill submitted by California includes longer stays that make the claims ineligible, Mr. Fenton wrote.

Additionally, stays of any length for homeless individuals qualify for reimbursement only if they tested positive for COVID-19, had been exposed—with documentation from health officials or medical professionals—or were at high-risk, including those over 65 or with specific underlying health conditions.

With the state and federal agency at odds over the interpretation of policy guidelines, several counties are working with a disaster recovery attorney to seek compensation.

The lawyer representing the counties, Wendy Huff Ellard of the national law firm Baker Donelson headquartered in Houston, Texas, told The Epoch Times the process could be lengthy and might ultimately result in arbitration.

She said counties are hopeful that FEMA will reverse its decision once its impact on local governments is better understood.

“The counties were under the impression that these costs would be covered,” Ms. Ellard said. “They’re relying on FEMA to reimburse these funds.”

Tyler Durden Fri, 02/16/2024 - 19:00

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