Sunday, October 13, 2019



  U.S. ‘Withdraws’ Forces to Let Turks Advance on 
                           America's Allies


The Daily Beast•October 13, 2019
Khalil Ashawi/Reuters

In the latest surge of anti-war rhetoric from the Trump administration, Defense Secretary Mark Esper said the U.S. is launching a “deliberate withdrawal” of American forces from northern Syria, but refused to say how long it will take.

“We want to conduct it safely and quickly as possible,” Esper told CBS’s Face the Nation on Sunday morning, adding, “I’m not prepared to put a timeline on it, but that’s our general game plan.”

Two knowledgeable U.S. officials told The Daily Beast that the troops are just withdrawing further away from the advance of Turkish forces massacring the Syrian Kurds whom America relied upon to destroy the so-called Islamic State’s caliphate.

There are currently 1,000 U.S. troops in Syria. A knowledgeable U.S. official said hundreds of those troops, without further specificity, will leave Syria for elsewhere in the Mideast. Following a pullout from two northern Syrian observation posts last week, the U.S. will now retreat further away from the area Turkish President Recep Tayyip Erdogan has invaded.

Esper said that President Donald Trump gave the withdrawal order because Turkish forces are pushing further south into Syria and Kurdish forces are trying to cut a deal with Syria and Russia to counter-attack.

“We have American forces likely caught between two opposing advancing armies and it’s a very untenable situation,” he said.

But as Esper made clear, the order affects only the north and there will still be American forces in the rest of Syria even as Trump—who separately has ordered about 14,000 U.S. troops to the Persian Gulf region over the past six months—rails against the disastrous, bloody and interminable U.S. misadventure in the Middle East over the past generation.

A U.S. official told CNN that U.S. policy “has failed” and that the campaign in Syria to defeat ISIS is “over for now,” giving the terrorist group “a second lease on life with nearly 100,000 [people] who will re-join their jihad.”

The mixed messaging by the Trump administration is making it difficult for even his most ardent supporters to help unravel his foreign policy on Syria as it spins out of control. 

Just days after Trump announced the withdrawal of American troops from northern Syria where they have been providing weapons and cover to allied Kurdish fighters on the border between Turkey and Syria, Turkey began a military incursion that has sent the region into a level of chaos it has not seen in recent years.

James Mattis On Trump's Syria Withdrawal: 'Re-Instilling Trust Is Going To Be Very Difficult'

Former Defense Secretary James Mattis, who served under President Donald Trump for two years, suggested he opposes Trump’s widely condemned decision to abandon U.S-allied Kurdish forces in northern Syria.

Mattis, who resigned in January after Trump announced he planned to abruptly withdraw U.S. forces from Syria, has been reluctant to forcefully speak out against the president, saying military officials shouldn’t be political.

But asked about Trump and his apparent decision to greenlight Turkey’s military assault on the Kurds, Mattis said his resignation says it all.

“I have my private, my personal concerns,” Mattis said during a taped interview with NBC’s “Meet The Press” that aired Sunday. “I keep those private. ... The defense of the country is non-partisan so we have to stay out of those sorts of discussions.”

He then pointed to his resignation letter, in which he urged Trump to maintain strong allies and show them respect, to understand his current stance.

“Only in Washington, D.C., could a public resignation over a matter of policy, a matter of principle, with a page-and-a-half letter explaining why be considered careful,” Mattis told host Chuck Todd.

“It talks about our security being tied inextricably to our alliances,” he said of his resignation letter, which prompted panic from Democrats and some Republicans when it was made public. “I don’t know what more I could say about how I think we ought to treat allies and how I think we should treat those who are adversaries.” 

TODAY: Former Defense Secretary James Mattis says to know how he feels about the current situation in Syria, read his resignation letter.

"It's a page and a half long. It talks about our security being tied inextricably to our alliances. I don't know what more I can say." #MTP pic.twitter.com/VfUgZR2pMx

— Meet the Press (@MeetThePress) October 13, 2019

Trump shocked Republicans and Democrats last week when the White House announced U.S. forces in northern Syria would allow Turkish forces to invade the area, essentially abandoning the Kurds. 

Over 130,000 people have been displaced since Thursday and hundreds of fighters from the self-described Islamic State, also known as ISIS, have escaped as Turkish-led forces targeted Syrian border towns held by Kurdish militia. Turkish-backed Arab fighters have also killed several Kurdish captives as well as Hervin Khalaf, the head of a Kurdish political party.

Foreign policy experts, including Brett McGurk, a former U.S. envoy to the global anti-ISIS coalition who resigned last year in protest of Trump, have warned that Trump’s decision not to defend the Kurds is highly immoral and threatens national security.

Mattis, during his interview with NBC, warned that ISIS will “absolutely” reemerge if the U.S. doesn’t keep the pressure on in Syria.

“ISIS is not defeated,” he said. “We may want a war over. We may even declare it over. ... But the enemy gets a vote, as we say in the military. In this case, if we don’t keep the pressure on, then ISIS will resurge.”

He said it’s going to be “very difficult” for the U.S. to save face after Trump’s decision to withdraw.

“You turn issues like this around based on trust,” Mattis said. “And re-instilling trust is going to be very difficult for the Americans at this point.”

He added: “America’s always safer when it builds the trust and a sense of reliability among our allies.”


This article originally appeared on HuffPost.



Trump says he is ‘island of one’ on Syria position as domestic and international criticism mounts

As the situation in northern Syria becomes more chaotic, US defence secretary admits he does not know whether Turkey would attack US troops

Donald Trump has described himself as “an island of one” over his sudden decision to remove US forces from northeastern Syria, as his defence secretary said 1,000 troops would be evacuated to avoid getting caught up in the Turkish invasion.

The president continued to defend the move that effectively green-lit the immediate Turkish assault on America’s Kurdish allies, who fought on the front line against Isis.

Amid bipartisan and international criticism that he has endangered stability in the Middle East, Mr Trump argued the US cannot fight “endless wars”.

Mark Esper, the US defence secretary, said most of the 1,000 US troops still in Syria were being moved as the Turkish military extended the scope of its incursion.

He told CBS’s Face the Nation: “In the last 24 hours we learned that they likely intend to expand their attack further south than originally planned, and to the west.”

The danger of US forces becoming embroiled in the conflict was illustrated on Friday when an American observation post came under shelling from Turkish artillery. No US troops were injured.

Asked whether he thought Turkey, a NATO ally, would deliberately attack American troops in Syria, Mr Esper said, “I don’t know whether they would or wouldn’t.”

A US military official told the Associated Press that the situation across northeastern Syria was “deteriorating rapidly” and that American troops had now become cut off from the Kurdish allies they had been fighting alongside.

Amid reports of 130,000 civilians forced to flee their homes, dozens killed and nearly 800 detainees having escaped from a camp holding Isis relatives, Mr Trump attempted to defend his "very smart" move on Sunday.

"Very smart not to be involved in the intense fighting along the Turkish Border, for a change. Those that mistakenly got us into the Middle East Wars are still pushing to fight," he tweeted. 

“We have to bring our great heroes, our great soldiers, we have to bring them home. It’s time. It’s time,” Mr Trump said in a lengthy, wide-ranging address to conservative activists at the Values Voter Summit on Saturday.

He portrayed the Middle East as a hopeless cause, despite years of American military involvement and financial investment.

“It’s less safe now. It’s less secure, less stable and they fight,” he said. “That’s what they do. They fight.”

The UN estimated on Sunday that at least 130,000 people had been displaced by the five-day-old Turkish invasion, with the official Kurdish death toll at 76.

Boris Johnson has, in a phone call with Turkish president Recep Tayyip Erdogan, urged Turkey to halt the offensive. 

And two of Turkey’s NATO allies, Germany and France, have said they are halting weapons exports to Turkey, while the Arab League denounced the operation.

Donald Trump defends decision to pull US forces out of Syria

Mr Trump announced that he had directed $50m in emergency aid for Syria to support Christians and other religious minorities.

Turkey regards the Kurds as terrorists, and Mr Trump suggested that he was aware of a likely invasion in the event of US withdrawal.

He defended his decision to reporters, saying Turkey had “been wanting to do this for many years ... they’ve been fighting each other for centuries”.

His former defence secretary Jim Mattis has also issued a strong warning that Mr Trump's move could lead to the resurgence of Isis.

"We may want a war over, we may even declare it over," General Mattis said, in an interview with NBC, aired on Sunday. 

 "You can pull your troops out as President Obama learned the hard way out of Iraq, but the 'enemy gets the vote', we say in the military.

"And in this case, if we don't keep the pressure on, then Isis will resurge. It's absolutely a given that they will come back."

Isis declared on Saturday that it has already started regrouping and is planning a fresh campaign in Syria, claiming responsibility for two deadly car bombs on Friday.

Mr Trump has previously talked tough on Isis, using their existence to justify enacting a travel ban on seven Muslim-majority countries.

But when asked about the prospect of escaped Isis prisoners shortly after his decision, Mr Trump played down the threat, telling reporters: “Well they’re going to be escaping to Europe. That’s where they want to go. They want to go back to their homes.”

On Sunday, an estimated 785 women and children affiliated with Isis escaped from a camp 50km north of Raqqa.

Kurdish authorities said “mercenaries” had attacked the Ain Issa camp where “Daesh elements” then attacked a severely diminished force of camp guards and opened the gates, amid Turkish shelling in the region.

As reports emerged of the escape, Turkish and Syrian rebel forces captured the neighbouring town of Suluk.

Mr Trump tweeted on Saturday night: “The same people that got us into the Middle East quicksand, $8tn and many thousands of lives (and millions of lives when you count the other side), are now fighting to keep us there.

“Don’t listen to people that haven’t got a clue. They have proven to be inept.”

The Independent/Additional reporting by AP



Female Kurdish politician ‘executed’ by pro-Turkish militants as civilian death toll rises to 38 in Syria offensive

Syrian Democratic Forces say politician was ambushed and shot dead in attack

Turkish-backed groups have killed nine civilians, including a female politician, in northeastern Syria, according to a human rights monitor.

Hevrin Khalaf, the Future Syria Party’s secretary-general, and her driver were ambushed and shot dead on Saturday, according to Kurdish forces.

“The nine civilians were executed at different moments south of the town of Tal Abyad,” the Syrian Observatory for Human Rights said.

In a statement, the political arm of the Kurdish-led Syrian Democratic Forces (SDF) said Khalaf was “taken out of her car during a Turkish-backed attack and executed by Turkish-backed mercenary factions”.

“This is clear evidence that the Turkish state is continuing its criminal policy towards unarmed civilians,” the SDF said.

Turkey and its allied fighters began an offensive on Wednesday to push back the Kurdish Peoples’ Protection Units (YPG) from its border.

The YPG is the primary component of the SDF who have been instrumental in fighting Isis in Syria.

The Turkish government has described the YPG as a “terrorist” group with links to Kurdish rebels in Turkey.

“With utmost grievance and sadness, the Syria Future Party mourns the martyrdom of engineer Havrin Khalaf, the General Secretary of Syria Future Party, while she was performing her patriotic and political duties,” the Future Party said in a statement on Khalaf’s death.

Two videos of the killings were circulated on social media by Kurdish activists.

Although the Syrian Observatory confirmed the authenticity of the videos, other news agencies, such as AFP, could not independently verify them.

A US State Department spokesperson told Reuters on Sunday that the United States had seen reports of the killings and it was looking into the incidents.

"We find these reports to be extremely troubling, reflecting the overall destabilisation of northeast Syria since the commencement of hostilities on Tuesday," the spokesperson said.

The Syrian Observatory added that the deaths brought the number of civilians killed on the Syrian side to at least 38 since the start of the offensive.

Eighty-one Kurdish fighters have also been killed in the clashes, the human rights group said.

The Turkish-backed Syrian National Army said on Saturday that it had ordered commanders to “continuously supervise combatants on the frontlines to prevent any abuse”,

The group, who oppose the SDF, added that perpetrators of possible abuses “would face the most severe sanctions and be brought to justice for military disobedience."



Islamic State Rears Its Head, Adding to Chaos as Turkey Battles Kurds

The New York Times•October 12, 2019
CEYLANPINAR, Turkey — The Turkish invasion of Kurdish-held territory in northern Syria raised new fears of a resurgence of the Islamic State on Friday, as five militants escaped from a Kurdish-run prison and the extremist group claimed responsibility for a bomb that exploded in the regional capital.

As Turkish troops launched a third night of airstrikes and ground incursions, Kurdish fighters said they had thwarted a second attempt to break out of a detention camp for families of Islamic State members.

The moves compounded a mounting sense of turmoil in northeast Syria, where tens of thousands of residents were reported fleeing south. The Turkish government said its troops had advanced 5 miles inside part of the country. Several major roads had been blocked and a major hospital abandoned.

Since Wednesday, Turkish forces have pummeled Kurdish-held territory with airstrikes and sent in ground troops, trying to seize land controlled by a Kurdish-led militia, the Syrian Democratic Forces. That militia fought alongside U.S. troops in the recent war against the Islamic State.

The campaign began after President Donald Trump suddenly ordered U.S. troops to withdraw from the area, giving implicit approval to Turkey’s long-anticipated attack on the Kurdish-led militia.

Trump’s decision was widely criticized, including by his Republican allies in the United States, who said it was a betrayal of an ally — the Kurds — that could cause a re-emergence of the Islamic State.

The White House — concerned that Congress would pursue bipartisan sanctions legislation against Turkey — said Trump would sign an executive order giving the Treasury Department new powers to punish officials in Turkey if its military targeted ethnic and religious minorities.

“We hope we don’t have to use them,” said Steven Mnuchin, the Treasury secretary. “But we can shut down the Turkish economy if we need to.”

Since pulling out, U.S. officials have expressed growing concern at the direction the Turkish incursion has taken, with officials warning Friday that the United States would respond forcefully if Islamic State fighters were allowed to escape from prisons in the area.

On Friday afternoon, President Recep Tayyip Erdogan of Turkey vowed to continue the campaign.

“The West and the U.S., together they say, ‘You are killing the Kurds’,” said Erdogan in a speech. “Kurds are our brothers. This struggle of ours is not against Kurds. It is against terror groups.’’

The Turkish government has framed the campaign as a counterterrorist operation because the Kurdish-led militia has close ties with a banned Turkey-based guerrilla movement that has waged a decades long struggle against the Turkish state.

Erdogan has promised that the fight against the Islamic State will continue and that his forces and their allies will continue to guard any captured militants in Kurdish-held prisons.

But the operation has already proved highly disruptive to efforts to keep the Islamic State at bay. Although U.S. and Kurdish forces have defeated Islamic State militants in northeastern Syria, the group has sleeper cells in the region that could use the turmoil to retake the land they controlled in the early years of the Syrian civil war.

And the Kurdish militia has diverted soldiers to fight the invasion and abandoned joint operations with U.S. troops as it prioritizes the defense of its land.

On Friday, a car bomb exploded on a residential street in Qamishli, the de facto capital of the Kurdish-held region — a rare act of Islamic State terrorism in a city that was relatively free of trouble before the Turkish assault began.

The Turkish bombardment has also endangered the security of several Kurdish-run prisons for Islamic State militants, with at least three in the vicinity of continuing Turkish airstrikes. It is widely feared that in the chaos, Islamic State fighters will escape captivity, as the five did Friday.

Kurdish authorities said shells had reached two Kurdish-controlled displacement camps, prompting officials to move some of their 20,000 inhabitants farther south.

One of the camps, in Ain Issa, has hundreds of relatives of Islamic State fighters, heightening fears over the effect that the Turkish invasion will have on the fight against the militant group.

Kurdish forces also released video of a third camp, which they said showed an effort to escape by members of Islamic State families.

A second video, seen by The New York Times, appeared to show prisoners trying to escape a Kurdish-controlled jail after it was hit by an airstrike.

While the Turkish airstrikes have hit targets along most of the 300-mile-long Kurdish-held territory, the ground battle has focused on two small but strategically located Syrian border towns, Tel Abyad and Ras al-Ain.

Turkish troops and their Syrian Arab allies have captured a cluster of villages around the two towns, which lie in the center of the Kurdish region. The troops have in one place established a front line 5 miles from the Turkish border, the Turkish vice president, Fuat Oktay, said Friday evening, according to Turkish media.

Their presence has prompted 100,000 residents to flee south, according to U.N. estimates, and forced the evacuation of a major hospital in Tel Abyad that was run by Doctors Without Borders, an international medical charity.

A second hospital, in Ras al-Ain, was also evacuated, according to a separate report by the Rojava Information Center, an information service run by activists in the region.

Turkish mortar shells also landed close to U.S. troops near the city of Kobani on Friday, prompting a complaint from the U.S. military, the Turkish Defense Ministry confirmed. No one was killed. Turkish officials said the Americans had not been targeted, though the Pentagon said Turkey had known that U.S. forces were in the area.

At least 54 Kurdish fighters have been killed since Wednesday, along with 42 from the Turkish-backed force, according to tolls compiled by the Syrian Observatory for Human Rights, a conflict monitor based in Britain.

Turkish towns north of the border have also been affected, as Kurdish fighters have returned fire.

Since fighting began Wednesday, at least 17 civilians, including four children, have been killed in Turkish border towns. At least four Turkish soldiers have died in the fighting, according to Turkish officials.

An entire Turkish border town — Ceylanpinar — was evacuated, after two girls were killed in a rocket strike Thursday and two people were seriously wounded Friday.

Ceylanpinar was largely deserted Friday afternoon, with shops shuttered and only stray dogs and a few men slipping out to chat or buy cigarettes.

“Our city is a ghost town,” complained Musa Sahman, 70, who sells a local raw meat delicacy but had no customers. “Our government is fighting for Syria, but we don’t have any business.”

But the damage has been far worse on the Kurdish side, where 60 civilians have died since Wednesday, according to the Kurdish Red Crescent.

The U.S. decision to ally with Kurdish militias set the stage for Turkey’s invasion this week.

By capturing land previously held by the Islamic State, Kurdish fighters were then able to create an autonomous statelet that spans roughly a quarter of all Syrian territory and is effectively independent of the central Syrian government in Damascus.

But this dynamic has been chastening for Syria’s northern neighbor, Turkey, which views the central figures in the autonomous Kurdish region as hostile actors with strong connections to a violent Kurdish nationalist group inside Turkey itself.

Turkey’s military campaign has come hand in hand with a crackdown on criticism inside Turkey.

The state-run media authority warned that it would “silence” any outlet deemed to have published material damaging to the offensive. Two editors at separate independent news websites were briefly detained, their outlets reported.

“We will never tolerate broadcasts that will negatively affect our beloved nation and glorious soldiers’ morale and motivation, that serves the aim of terror, and might mislead our citizens with faulty, wrong and biased information,” the media authority said in a statement.

The Turkish incursion has prompted a mixed reaction from the 3.6 million Syrian refugees sheltering in Turkey.

Some fear they will end up being deported to the areas recaptured by Turkish forces in northern Syria, despite having no ancestral links there. Others from the areas of northern Syria currently under attack said they welcomed the campaign.

In Turkey, on a hilltop overlooking the Syrian border and the town of Tel Abyad, a lone Syrian man, Mehmet Huseyn, 45, crouched in the shade of a rusting water tank, scanning the horizon for signs of movement.

His brother and family were in his home village, 6 miles beyond the ridgeline, while he had been working as a farm laborer in Turkey for four years to support his family of seven, he said.

“Our village is there,” he said. “I am looking in case they leave and we can return home.”

But it pained him to see more war visited on his home. “Our insides are burning,” he said. “We love our land and we love our country.”

This article originally appeared in The New York Times.



© 2019 The New York Times Company




British regulator reviews JPMorgan metals trading amid U.S. probe: sources

NEW YORK/LONDON (Reuters) - Britain’s financial services regulator is examining allegations of precious metals market manipulation by JPMorgan Chase & Co traders following criminal charges by U.S. authorities, according to two people familiar with the matter.

The UK Financial Conduct Authority (FCA) is one of the various authorities that JPMorgan has previously said were investigating its metals trading, according to one of the people, who declined to be named due to the sensitivity of the matter. The watchdog has requested documents and other information from JPMorgan, the source said.

The exact scope of the FCA scrutiny or whether it will result in any charges was unclear.

The U.S. Department of Justice (DOJ) has charged five current and former JPMorgan metals traders, who worked in New York, London and Singapore, with alleged price manipulation between 2007 and 2016. Two of them have been charged in parallel by the Commodity Futures Trading Commission (CFTC). The joint investigation is ongoing, a DOJ official has said.

One of the traders was charged in 2018, and four this year. Two have pleaded guilty to manipulating prices. The lawyers for the three most recently charged, in September, said their clients would contest the allegations against them.

JPMorgan said in an Aug. 6 regulatory filing that it was “responding to and cooperating” with various investigations relating to trading practices in the metals markets.

The FCA, DOJ and CFTC all declined to comment.

The second person familiar with the matter is London-based metals trader Andrew Maguire, who has long complained about alleged metals market manipulation on both sides of the Atlantic.

He told Reuters he met FCA officials in August, along with British lawmaker Jeremy Lefroy, to discuss possible metals market manipulation in London. He said he was told by the officials that they were looking into JPMorgan’s metal trading, and that they had contacted the DOJ and CFTC to learn more.

Lefroy confirmed that the meeting with the FCA took place and said he and Maguire were assured that the FCA was following the U.S. investigation closely for any possible implications in Britain and would follow up on these if found.

New York and London are hubs for precious metals dealing, and large international banks are among the biggest traders, managing orders for themselves and clients.

U.S. prosecutors have said that the five charged JPMorgan traders had influenced metals prices by placing bids with the intent to cancel them before execution – a technique known as spoofing. By creating an illusion of demand, spoofers can move prices to benefit their market positions.

There has been a surge in spoofing-related prosecutions in recent years involving banks and dealers. These include Bank of America Corp’s Merrill Lynch commodities unit, which was fined $25 million by U.S. authorities in July, and Morgan Stanley, which was fined $1.5 million in the United States last month.

The DOJ has taken an aggressive stance, most recently charging three of the five men in the JPMorgan case with a racketeering conspiracy, a technique more commonly associated with organized crime prosecutions. All contest the charges.

The U.S. charges against JPMorgan staff center on manipulation of U.S. exchanges. Trading can be conducted on these exchanges from locations outside the United States, including London, where some of the men charged by U.S. investigators have been based.

The London Bullion Market Association (LBMA), which sets trade standards for metals trading but is not a regulator, said it “takes very seriously all allegations of misconduct or criminal conduct which may prejudice or damage the integrity and efficient operation of the precious metals markets”.

JPMorgan, like most other large international banks that trade gold, is an LBMA member.


California bans private prisons and immigration detention centers


LOS ANGELES (Reuters) - California moved to end the use of private, for-profit lockups in America’s largest state prison system as well as in federal immigration detention centers in the state under a measure signed into law on Friday by Governor Gavin Newsom.

FILE PHOTO: California governor Gavin Newsom stands next to an American flag as he waits to speak at a news conference in San Diego, California, U.S. October 9, 2019. REUTERS/ Mike Blake/File Photo
The new law bars the California Department of Corrections and Rehabilitation from entering into or renewing a contract with a private company to run a state prison after Jan. 1, 2020, unless needed to meet court-ordered inmate housing limits. It will ban California from incarcerating anyone in privately run facilities altogether from 2028.

The measure, which passed the California legislature last month, does not apply to privately owned prisons operated and staffed by the state corrections agency.

Newsom said in a statement that he had vowed to abolish private prisons in the state when he took office in January “because they contribute to over-incarceration, including those that incarcerate California inmates and those that detain immigrants and asylum seekers.”

“These for-profit prisons do not reflect our values,” Newsom said.

Supporters of the bill have argued that private prisons are driven to maximize shareholder profits, lack proper oversight or incentives to rehabilitate inmates and have contributed to a culture of mass incarceration by making it cheaper to lock up people.

A total of seven low-security facilities collectively housing more than 5,000 people are at stake, all of them operated either by Florida-headquartered GEO Group, or Tennessee-based CoreCivic.

Defending their business model, the companies said they provided vital extra space when detentions in California’s prisons swelled to more than double the system’s capacity, sparking lawsuits that led to court-ordered cuts to inmate populations.

“For 10 years, we provided safe, secure housing and life-changing re-entry programming for inmates that had faced extreme overcrowding,” CoreCivic spokeswoman Amanda Gilchrist said.

Separately, GEO Group cited its record as “an innovator in the field of rehabilitative services” and said the bill worked against the state’s goal of lowering inmate recidivism.

DETENTION CENTERS TO CLOSE
The last three remaining privately run prisons in California’s corrections system, housing a total of 1,400 inmates, are set to close in four years under the new law when their contracts with the state expire.

Perhaps more significantly, the federal Immigration and Customs Enforcement (ICE) agency stands to lose four privately run detention facilities holding roughly 4,000 people in California, unless the ban is challenged in court.

In a statement, GEO Group called California’s newly enacted prohibition on privately run ICE detention centers a violation of the U.S. constitutional doctrine granting the federal government supremacy over the states, suggesting a legal challenge might be in the offing.

ICE had said separately before the legislation was signed that its detainees would merely be transferred to facilities outside California, forcing friends and family of the detainees to travel greater distances to visit their loved ones.

Several states, including New York, Illinois and Nevada, have adopted similar bans on private prisons, and nearly half of all states have no such facilities, said Kara Gotsch, director of strategic initiatives for the Sentencing Project, a criminal justice reform group.

California’s share of inmates in private facilities is a small fraction of its total prison population of nearly 126,000.

By comparison, Texas, which became the first state to outsource incarceration to private companies in 1985, had far more inmates than any other state in for-profit facilities in 2017 at nearly 13,000, or 7.8 percent of its total, said Gotsch.




Judge blocks Trump immigration rule, calls it 'repugnant to American Dream'


NEW YORK (Reuters) - A U.S. federal judge in New York on Friday temporarily blocked a Trump administration rule that would deny residency to aspiring immigrants deemed likely to require government assistance, calling it “repugnant to the American Dream.”



The rule, finalized in August, vastly expanded who could be considered a possible “public charge,” applying to anyone who might in the future need temporary government help such as food stamps, Medicaid or housing aid. Previously it applied to immigrants who would be primarily dependent on the government.

The Department of Homeland Security (DHS) rule, if ultimately allowed to take effect, could be the most drastic of the Trump administration’s hardline anti-immigration policies, experts have said.

Pushed by Trump’s leading aide on immigration, Stephen Miller, the rule was due to go into effect on Tuesday.

But Judge George Daniels of the Southern District of New York blocked the rule nationwide, finding that the government failed to provide “any reasonable explanation” for why the definition of public charge needed to be changed.

It will now be on hold while the underlying legal challenges proceed.

The suit was brought by the state of New York, one of nine legal challenges to the public charge rule. Other U.S. judges issued similar injunctions elsewhere on Friday, including the Eastern District of Washington and the Northern District of California.

In California, U.S. Judge Phyllis Hamilton found “the plaintiffs are likely to prevail on the merits, for numerous reasons.”

In New York, Judge Daniels called the rule a “policy of exclusion in search of a justification.”

“It is repugnant to the American Dream of the opportunity for prosperity and success through hard work and upward mobility,” Daniels wrote.

The Department of Justice did not immediately respond to a request for comment.

The Trump administration, with Miller in a leading role, has enacted a series of measures attempting to curtail immigration, only to be blocked by court injunctions until the underlying lawsuits can be heard.

Trump lost another ruling on Friday when a U.S. judge in Texas blocked emergency funding for construction of a southern border wall.

Judge David Briones of the Western District of Texas granted an injunction against border wall funding beyond that appropriated by Congress. The County of El Paso, Texas, and the Border Network for Human Rights had sued to stop Trump when he announced he would divert military and drug interdiction funds toward construction of the wall.

The judge’s order was not final as he asked the parties to submit further filings to be considered over the next 15 days.

Miller, speaking before the border wall ruling, criticized the courts, calling their rulings “dangerous.”

“The situation in the federal judiciary with respect to these nationwide injunctions, which have proliferated to an unprecedented degree, is intolerable. And it impedes democracy from functioning,” Miller said.

The public charge rule laid out factors immigration officers should weigh, including household income and English proficiency. Immigrant advocates said this would disproportionately affect people from Latin American, African and Asian countries.

The judge called the inclusion of English proficiency as a predictor of self-sufficiency “simply offensive.”

“Judge Daniels understands that to Donald Trump and Stephen Miller, the cruelty of their ‘public charge’ rule is the point,” said Heidi Hess, co-director of CREDO Action, a network of progressive activists.

Most visa holders and unauthorized immigrants are ineligible for public benefits, but immigrant advocates, medical professionals and state officials have argued the rule could deter them from seeking benefits even for children who are U.S. citizens.

An estimated 15% to 35% of California families eligible for social welfare will withdraw from programs out of fear of the immigration consequences, according to the California Immigrant Policy Center, an immigrant-rights organization.

On Thursday, the State Department revealed its own rule on ineligibility for visa applicants, to bring its standards in line with the DHS rule. It was unclear whether the State Department’s rule will take effect.

Reporting by Kristina Cooke in Los Angles and Daniel Trotta and Jonathan Stempel in New York; Editing by Cynthia Osterman, David Gregorio and Sandra Maler
Boeing board strips CEO of chairman title amid 737 MAX crisis

(Reuters) - Boeing Co’s (BA.N) board has stripped chief executive Dennis Muilenburg of his chairmanship title, in an unexpected strategy shift announced by the U.S. planemaker on Friday only hours after a global aviation panel criticized development of the troubled 737 MAX.

Separating the roles, which will enable Muilenburg to have “maximum focus” on steering daily operations, was the latest step the board has taken in recent weeks to improve executive oversight of its engineering ranks and industrial operations.

Lead Director David Calhoun, a senior managing director at Blackstone Group, will takeover as non-executive chairman, Boeing said in its announcement, which came late on Friday afternoon without warning. It added that the board had “full confidence” in Muilenburg, who will retain the top job and remain on the board.

The decision came as Boeing struggles to get its best-selling 737 MAX back into service following a worldwide safety ban in March triggered by two crashes that killed a total of 346 people in Ethiopia and Indonesia.

It also comes some six months after Muilenburg survived a shareholder motion to split his chairman and CEO roles, part of the intense pressure he has faced during the worst crisis of his four years at the helm of the world’s largest planemaker.

“This decision is the latest of several actions by the board of directors and Boeing senior leadership to strengthen the company’s governance and safety management processes,” the company said.

INTENSE SCRUTINY
Earlier on Friday, an international aviation panel criticized U.S. regulators and Boeing over the certification of the plane.

An internal review in August revealed that the company was working to reorganize its engineering reporting lines company-wide and ensure higher ranking officials, including its CEO, get faster feedback about potential safety concerns from lower levels of the company.

As part of the move, Muilenburg received granular weekly reports of potential safety issues discussed at meetings of rank-and-file engineers.

It also plans to name a new director with deep safety experience and expertise to serve on the board and its newly created Aerospace Safety Committee in the near term, Boeing said.

Muilenburg is set to testify before a U.S. House panel on Oct. 30 and lawmakers have raised questions about Boeing’s actions prior to the 737 MAX certification. Federal prosecutors aided by the FBI, the Transportation Department Inspector General and several blue-ribbon panels are investigating the plane’s approval.

The company is also facing more than 100 lawsuits over the crashes alleging design flaws allowed erroneous sensor data to set off an automated anti-stall system and overwhelm pilots.

MORE DELAYS
Earlier this week, Reuters reported that a key certification test flight would likely not take place until at least Nov. 1, a move that will push its approval to resume flights until at least December.

On Friday, United Airlines Holdings Inc (UAL.O) became the latest U.S. airline to say it would not resume 737 MAX flights until January.

Shareholder advisory firms Institutional Shareholder Services Inc and Glass Lewis had urged Boeing to split the role of chairman and CEO in April, saying shareholders would benefit from a robust form of independent oversight.

Muilenburg is set to testify before a U.S. House panel on Oct. 30. Lawmakers have raised questions about Boeing’s actions prior to the 737 MAX certification.

FAA failed to properly review 737 MAX jet's anti-stall system: JATR findings

WASHINGTON/SINGAPORE (Reuters) - A panel of international air safety regulators on Friday harshly criticized the U.S. Federal Aviation Administration’s (FAA) review of a safety system on Boeing’s (BA.N) 737 MAX airliner later tied to two crashes that killed all 346 people aboard.


The Joint Authorities Technical Review (JATR) was commissioned by the FAA in April to look into the agency’s oversight and approval of the so-called MCAS anti-stall system.

The report also faulted Boeing for assumptions it made in designing the airplane and found areas where Boeing could improve processes.

“The JATR team found that the MCAS was not evaluated as a complete and integrated function in the certification documents that were submitted to the FAA,” the 69-page series of findings and recommendations said.

“The lack of a unified top-down development and evaluation of the system function and its safety analyses, combined with the extensive and fragmented documentation, made it difficult to assess whether compliance was fully demonstrated.”

Boeing did not directly address the report’s findings but said it “is committed to working with the FAA in reviewing the recommendations and helping to continuously improve the process and approach used to validate and certify airplanes.”

Regulators around the world continue to scrutinize proposed software changes and training revisions from Boeing aimed at returning the Boeing 737 MAX to service.

Boeing’s top-selling airplane has been grounded worldwide since a March 10 crash in Ethiopia killed 157 people, five months after a Lion Air 737 MAX crashed in Indonesia, killing 189 people on board.

Major U.S. airlines including Southwest Airlines Inc (LUV.N) and American Airlines Inc (AAL.O) currently do not expect 737 MAX flights to resume before January.

The JATR draft recommendations, obtained by Reuters ahead of their release on Friday, also said the FAA’s longstanding practice of delegating “a high level” of certification tasks to manufacturers such as Boeing needs significant reform to ensure adequate safety oversight.

“With adequate FAA engagement and oversight, the extent of delegation does not in itself compromise safety,” the report said.

“However, in the B737 MAX program, the FAA had inadequate awareness of the MCAS function which, coupled with limited involvement, resulted in an inability of the FAA to provide an independent assessment of the adequacy of the Boeing-proposed certification activities associated with MCAS.”

The report also questioned FAA’s limited staffing to oversee certification tasks it designated to Boeing and said there were an “inadequate number of FAA specialists” involved in the certification of the 737 MAX.

There were signs that Boeing employees conducting FAA work faced “undue pressure. ..which may be attributed to conflicting priorities and an environment that does not support FAA requirements,” it said.

FAA Administrator Steve Dickson said in a statement he would look at the panel’s recommendations and take appropriate action following the “unvarnished and independent review of the certification of the Boeing 737 MAX.”

MCAS UNDER SCRUTINY
The U.S. planemaker has stopped short of admitting any fault in how it developed the 737 MAX, or MCAS, which repeatedly pushed the plane’s nose down in the Indonesian and Ethiopian crashes while the pilots struggled to intervene.

However, it has said erroneous Angle of Attack (AOA) data fed to MCAS - the Maneuvering Characteristics Augmentation System - was a common link in two wider chains of events leading to the crashes.

Slideshow (2 Images)
The JATR report recommended the FAA review the stalling characteristics of the 737 MAX without MCAS and associated systems to determine if unsafe characteristics exist and if so, if a broader review of the system design was needed.

JATR said MCAS and those systems could be considered a stall identification or stall protection system, depending on how the aircraft handled without them.

Boeing has said MCAS was not meant to prevent stalls and was instead designed so that the 737 MAX would have similar handling characteristics to its predecessor, the 737 NG.

The European Union Aviation Safety Agency (EASA) last month said it planned to undertake flight tests of the 737 MAX including a test without MCAS to check its performance during high-speed turns and stall.

Boeing is revising the 737 MAX software to require the MCAS system to receive input from both AOA sensors, and has added additional safeguards. If the AOA sensors differ by 5.5 degrees or more then MCAS cannot operate, FAA Deputy Administrator Dan Elwell said last month.

If MCAS does operate it can only operate once unless the problem had been “completely resolved,” he added.

The JATR is headed by Christopher Hart, former chairman of the National Transportation Safety Board (NTSB), and includes air safety regulators from the United States, Canada, China, Indonesia, European Union, Brazil, Australia, Singapore, United Arab Emirates and Japan.

Last month, Hart said it was important to note “the U.S. aviation system each day transports millions of people safely, so it’s not like we have to completely overhaul the entire system, it’s not broken. But these incidents have shown us that there are ways to improve the existing system.”

Scientists endorse mass civil disobedience to force climate action


Matthew Green


LONDON (Reuters) - Almost 400 scientists have endorsed a civil disobedience campaign aimed at forcing governments to take rapid action to tackle climate change, warning that failure could inflict “incalculable human suffering.”





Julia Steinberger, an ecological economist at Britain's University of Leeds, endorses mass civil disobedience to pressure governments to tackle climate change at a protest at London's Science Museum, Britain October 12, 2019. Louise Jasper/Handout via REUTERS

In a joint declaration, climate scientists, physicists, biologists, engineers and others from at least 20 countries broke with the caution traditionally associated with academia to side with peaceful protesters courting arrest from Amsterdam to Melbourne.

Wearing white laboratory coats to symbolize their research credentials, a group of about 20 of the signatories gathered on Saturday to read out the text outside London’s century-old Science Museum in the city’s upmarket Kensington district.

“We believe that the continued governmental inaction over the climate and ecological crisis now justifies peaceful and non-violent protest and direct action, even if this goes beyond the bounds of the current law,” said Emily Grossman, a science broadcaster with a PhD in molecular biology. She read the declaration on behalf of the group.



“We therefore support those who are rising up peacefully against governments around the world that are failing to act proportionately to the scale of the crisis,” she said.

The declaration was coordinated by a group of scientists who support Extinction Rebellion, a civil disobedience campaign that formed in Britain a year ago and has since sparked offshoots in dozens of countries.

The group launched a fresh wave of international actions on Monday, aiming to get governments to address an ecological crisis caused by climate change and accelerating extinctions of plant and animal species.

A total of 1,307 volunteers had since been arrested at various protests in London by 2030 GMT on Saturday, Extinction Rebellion said. A further 1,463 volunteers have been arrested in the past week in another 20 cities, including Brussels, Amsterdam, New York, Sydney and Toronto, according to the group’s tally. More protests in this latest wave are due in the coming days.




While many scientists have shunned overt political debate, fearing that being perceived as activists might undermine their claims to objectivity, the 395 academics who had signed the declaration by 1100 GMT on Sunday chose to defy convention.

“The urgency of the crisis is now so great that many scientists feel, as humans, that we now have a moral duty to take radical action,” Grossman told Reuters.

Other signatories included several scientists who contributed to the U.N.-backed Intergovernmental Panel on Climate Change (IPCC), which has produced a series of reports underscoring the urgency of dramatic cuts in carbon emissions.

“We can’t allow the role of scientists to be to just write papers and publish them in obscure journals and hope somehow that somebody out there will pay attention,” Julia Steinberger, an ecological economist at the University of Leeds and a lead IPCC author, told Reuters.

“We need to be rethinking the role of the scientist and engage with how social change happens at a massive and urgent scale,” she said. “We can’t allow science as usual.”





Extinction Rebellion’s flag is a stylized symbol of an hourglass in a circle, and its disruptive tactics include peacefully occupying bridges and roads.

The group has electrified supporters who said they had despaired at the failure of conventional campaigning to spur action. But its success in paralyzing parts of London has also angered critics who complained the movement has inconvenienced thousands of people and diverted police resources.

Extinction Rebellion is aligned with a school strike movement inspired by Swedish teenage activist Greta Thunberg, which mobilized millions of young people on Sept. 20. It hopes the scientists’ support for the urgency of its message and its embrace of civil disobedience will bolster its legitimacy and draw more volunteers.

The group said more than half the signatories of the declaration are experts in the fields of climate science and the loss of wildlife. Although British universities and institutes were well represented, signatories also worked in countries including the United States, Australia, Spain and France.


Reporting by Matthew Green; Editing by Frances Kerry

'Broken system' starves U.S. oil boom of immigrant workersAndrew Hay

HOBBS, N.M. (Reuters) - New Mexico oil man Johnny Vega laid out his predicament as his crew hoisted pipes from a well during the biggest oil boom in U.S. history.

FILE PHOTO: Oil field worker, Miguel Holguin, operates a swabbing rig 




in a field in Seminole, TX, U.S. September 19, 2019. REUTERS/Adria Malcolm

The son of a Mexican guestworker, Vega cannot find enough legal workers to meet demand for his oil well service rigs.

There is no shortage of Hispanic and Latino immigrant workers without work permits he could hire in Lea County, New Mexico - the No.2 oil-producing county in the United States.

But Vega says he wants to play by the rules, not least because of a heightened risk of company audits by U.S. Immigration and Customs Enforcement (ICE) under President Donald Trump. As a result, he has equipment that could be generating $700,000 a month standing idle in his yard.

“They’re demanding more rigs, more swabbing units, but you don’t have enough employees,” said Vega, who runs Mico Services with around $17 million in annual revenues. “It’s a lack of a system to get legal workers, to have more of a workforce to pull from.”

Employers like Vega in the Permian Basin oilfields of New Mexico and Texas say they feel caught between Trump’s support for their industry and his policies focused on tougher immigration enforcement.

It’s a dilemma faced in other sectors of the U.S. economy that depend on foreign workers after ICE reported surges of between 300% to 750% in worksite investigations, audits and arrests in fiscal year 2018.




Visas for temporary jobs in sectors like agriculture and hospitality have increased during the Trump administration. Oil companies complain of difficulties gaining work permits for immigrant oil workers, who do not qualify for these temporary visas.

The Permian Basin, by far the most productive oil field in the United States, has helped make the country a net exporter of oil. Its output growth has recently slowed, but production is still at all time highs.

The number of rigs drilling for oil in New Mexico hit a record 115 in early October and labor shortages are felt most keenly in service companies like Vega’s that help keep the oil flowing.

The Permian Basin is short 15,000 workers, with demand met by paying overtime and shipping workers in and out, according to data from the Permian Strategic Partnership alliance of 19 energy companies.



DANGEROUS JOBS

Thousands of immigrants, mainly from neighboring Mexico, have thronged to the decade-long boom. They often fill the hardest and most dangerous jobs few Americans want, such as using heavy equipment to lift oil well tubing or lay pipeline.

For Bob Reid, immigrants provide a solution to labor shortages and a chance for boom-bust oil towns like Hobbs, New Mexico to build a more stable future.

“The problem is a broken system that’s preventing them from coming in legally in a way that allows them to pursue a path to citizenship,” said Reid, head of the JF Maddox Foundation, a Hobbs charity.

In Lea County, Hispanics and Latinos now account for as much as 70 percent of the population, compared with 40 percent 20 years ago, based on county school enrollment and other data.

About two years ago, ICE stepped up operations in the Permian area, according to Lea County employers.

“I know people, my peers, that have been hit by immigration audits, and they were told, specifically, that the Permian Basin was targeted because of the vast amount of workers that were coming here,” said Finn Smith, president of Hobbs-based Watson Hopper Inc.

ICE did not respond to requests for comment on its Permian operations.

Two companies in Hobbs, the largest city in Lea County, were recently audited: Mesa Well Services and paving contractor Ramirez & Sons, according to a person with knowledge of the situation and a Ramirez & Sons official.

Mesa Well officials were not available for comment. Ramirez & Sons Senior Superintendent David Gallegos said the company was paying around $40,000 in legal fees to apply for work permits or U.S. citizenship on behalf of five of the employees laid off after the audit.

“They’re worth fighting for,” said Gallegos, a Republican New Mexico state representative, of the “long term” employees who had bought homes in the area.




ICE operations, and Trump’s threats of raids, have left many immigrants in Lea County fearful. Some bolt from job sites at rumors of ICE activity, said Maria Romano of New Mexico-based immigrant rights group Somos Un Pueblo Unido.

More companies are using the government’s E-Verify immigration background checks to vet new hires, said Romano, whose organization helps immigrants get on a pathway to citizenship.

‘VERY DIFFICULT HERE’

“It’s now getting very difficult here for anyone who isn’t documented,” said Juan, an unemployed pipeline worker who immigrated to the United States illegally 11 years ago. He asked that his last name not be used to protect his identity.

About a third of all immigrants in New Mexico and Texas lack valid working papers, according to a Pew Research Center study based on 2016 U.S. census data.

Hobbs Mayor Sam Cobb says he is frustrated by the failure of political leaders at the national level to create a pathway to citizenship for immigrants he generally finds hardworking and law abiding.

“The very people who have suffered from that are the people who are here growing our community, adding to the economic welfare of the community,” said Cobb, a Democrat, sitting in his office surrounded by paintings of oil wells and cowboys.

Yet plenty of employers in Lea County still hire undocumented workers.

“What we do is we don’t ask,” said Lorena, a Mexican immigrant whose family has built up a small oil field services business. She estimated that more than 90% of her employees were Mexican immigrants and that only 5% to 10% had genuine working papers. Her last name was not used to protect her identity.

Vega’s labor woes are pushing him to reorient his oil well service business toward hiring out his equipment.

“We have to rely on some of these immigrants, in this neck of the woods, to produce the workforce that we’re needing,” said Vega, who said he supports Trump “100%” but wishes he would “tone down” his rhetoric against immigrants. “Why not allow them to be documented?”

Reporting By Andrew Hay in Hobbs, New Mexico; Additional reporting by Gary McWilliams in Houston; Editing by Bill Tarrant and Daniel Wallis
Rising old used car prices help push poor Americans over the edge



FREEPORT, Ill. (Reuters) - For America’s working poor, an often essential ingredient for getting and keeping a job – having a car – has rarely been more costly, and millions of people are finding it impossible to keep up with payments despite prolonged economic growth and low unemployment.

More than 7 million Americans are already 90 or more days behind on their car loans, according to the New York Federal Reserve, and serious delinquency rates among borrowers with the lowest credit scores have by far seen the fastest acceleration.

The seeds of the problem are buried deep in the financial crisis, when in the midst of the worst economic downturn since the Great Depression, automakers slashed production. A decade later, that has made a relative rarity of used 10-year-old vehicles that are typically more affordable for low-wage earners.

According to data provided to Reuters by industry consultant and car shopping website Edmunds, the average price of that vintage of vehicle is $8,657, still nearly 75% higher than in 2010 despite some softening in prices over the last year. The average new car, in contrast, has seen a price rise of 25% in that same time period.

“This is pinching people at the worst point possible,” said Ivan Drury, Edmunds’ senior manager of industry analysis. “If you need basic A to B transportation, you have to get an older car that needs more repairs and has more wear-and-tear issues.”

Monthly auto payments for Americans making under $40,000 have remained flat since 2017, while those in higher wage brackets have seen their payments rise, according to a Cox Automotive Inc analysis for Reuters.

On the face of it, this might seem like good news. But to Cox chief economist Jonathan Smoke, it indicates poorer Americans are stretched so thin they cannot afford to pay more.

“They just don’t have any flexibility to increase their payment,” Smoke said.

Weak lending standards in recent years are partly to blame for the rising delinquency rates, which Warren Kornfeld, a senior vice president on Moody’s financial institutions team, said are approaching record highs despite a solid economy.

Auto lenders are belatedly tightening lending standards, but it may already be too late, he said.

“The economy is masking the true performance of auto loans,” Kornfeld said. “If we hit a downturn today, the performance of auto loans would not look very good.”

Research from the New York Fed earlier this year showed that while delinquency rates among borrowers with high credit scores have remained steady and low, for subprime borrowers they have been rising, pushing up the overall delinquency rate. Around 8% of loans originated by lower-score buyers with a credit score below 620 were categorized as seriously late, “a development that is surprising during a strong economy and labor market,” Fed researchers wrote.





‘HARD TO MAKE ENDS MEET’

Like many Americans, for Hollis Heyward no car means no job. The 30-year-old father of two makes $10 an hour working at a warehouse in Freeport, a rural town of 25,000 about 115 miles (185.07 km) northwest of Chicago.

Heyward can only get to work by car.

In the midst of a divorce, all he could afford was a gray 2005 Pontiac Grand Prix with close to 200,000 miles on it, which he bought for $1,300 cash - a fraction of the average new car price.

Suddenly also stuck paying off the loan on his future ex-wife’s car, Heyward had to rework the loan with local used-car dealer Gordy Tormohlen of Good People Automotive. Under his “workout” deal, Heyward is paying the loan’s principal only and Tormohlen has waived the interest payments. Heyward’s monthly payment is now around $120 per month, down from around $350 before the workout.

“Right now, it’s hard to make ends meet,” said Heyward. “But I am not the kind of guy to walk away from my commitments.”

Tormohlen, 59, a second-generation dealer, said his business is up 10% this year as auto finance companies tighten lending standards. He said the market feels like it did before the financial crisis hit in 2008, when consumers were over-extended with debt.




“Americans have grown too comfortable with debt and the time has come to pay the piper,” he said.

Tormohlen is a “Buy Here, Pay Here” dealer, offering subprime loans that he finances himself at 19%, which is higher than a bank but lower than many finance companies.

He said he can work directly with struggling customers like Heyward, whom he has known for a decade, but worries that large finance companies with tens or hundreds of thousands of borrowers will be in deep trouble when a downturn hits.

Indeed, according to the New York Fed, more than 1 million more Americans are behind on their car loans now than at the peak of delinquencies in 2010 after the financial crisis.

“The big lenders who do not know their customers are going to have a problem when the economy turns,” Tormohlen says.

“LIVE BEYOND YOUR MEANS”



Expensive older used cars are exacerbating the problem and it may take years for them to return to more affordable levels.

George Augustaitis, director of automotive industry analytics at CarGurus Inc (CARG.O), an online marketplace for new and used cars, said late this spring his team started to notice an “accelerating decline” in the number of available vehicles under $10,000, which typically would include vehicles between eight and 12 years old.

In an analysis for Reuters, CarGuru’s data shows a falling share of inventory of Great Recession-era cars, while the number of online “leads” from consumers seeking those vehicles has remained steady.

In fact, the average American car is the oldest on record, according to IHS Markit, and CarGurus’ Augustaitis said the available inventory of vehicles costing under $10,000 will not return to more normal levels until 2022, reflecting rising car production after the Great Recession.

Ken Shilson, president of the National Alliance of Buy Here, Pay Here Dealers (NABD), said American consumers have become too comfortable with debt and subprime customers have been “poisoned” by easy access to capital for much of the long economic expansion. But he added those customers will be forced by tighter underwriting to seek even older vehicles.

“The American way is to always live beyond your means and Americans aren’t good at making life adjustments,’ Shilson said. “But there’s a reality check coming and many subprime buyers will be forced to find more affordable transportation.”

Reporting By Nick Carey; Editing by Dan Burns and Andrea Ricci

\
REACTIONARY WHITE SNOWFLAKE STUDENTS DECRY BEING TOLD THEY HAVE PRIVILEGE BY BOOK BURNING

A Cuban-American author canceled her speaking event on diversity at a Georgia university after students were filmed burning her book
Frank Olito
Jennine Capo Crucet cancelled her second speaking engagement. Cindy Ord/ Getty


At Georgia Southern University in Statesboro, Cuban-American author Jennine Capo Crucet gave a speech about diversity and white privilege.
One student asked if she had "the authority to address issues of race and white privilege on campus," which prompted an angry exchange amongst students in the auditorium.
Crucet later learned that students were filming themselves burning her book on campus.
The author decided to cancel her second speaking engagement at the university.
Visit Insider's homepage for more stories.

Jennine Capo Crucet, a Cuban-American author, canceled her second speaking event at Georgia Southern University in Statesboro after her first talk was interrupted by an angry exchange among students. The author later learned that students were burning her book on campus.


Crucet was on campus Wednesday to talk about diversity and to read from her book "Make Your Home Among Strangers," which was assigned as mandatory reading for all freshmen students. The book follows a Cuban-American student as she acclimates to an elite college environment.

At her talk on Wednesday, a white student stood up and asked if Crucet had "the authority to address issues of race and white privilege on campus," according to a statement the author released.

"I noticed that you made a lot of generalizations about the majority of white people being privileged," the student asked, according to the school newspaper, The George-Anne. "What makes you believe that it's okay to come to a college campus, like this, when we are supposed to be promoting diversity on this campus, which is what we're taught. I don't understand what the purpose of this was."

The questions prompted students to yell at each other from across the auditorium.


"I came here because I was invited and I talked about white privilege because it's a real thing that you are actually benefiting from right now in even asking this question," Crucet responded over students' shouts.

After the event, Crucet learned that students were burning her book on campus. Another student tweeted at the author, writing, "Are you usually that racist or are you putting on a front to promote your pointless and shitty book at my college? Work on your ignorance and racism toward white people."
—elaina⭐️ (@elainaaan) October 10, 2019

Georgia Southern spokeswoman Jennifer Wise told the Daily Mail that the students will not be disciplined, as they were exercising their first amendment rights.

In response, Crucet canceled the second speech she was expected to give.

"This book began as an act of love and an attempt at a deeper understanding," Crucet said in her statement. "I hope that GSU can act from the same place and work to affirm the humanity of those students who might understandably feel unsafe in the aftermath of the event and the book burning and that the campus continues the difficult and necessary conversation that began in that auditorium."

The NBA faces a billion-dollar crisis over one executive's tweet about Hong Kong. Here's why China is so hard for Western brands to break into.
Alexandra Ma


A composite image of NBA Commissioner Adam Silver, a now-withdrawn Tiffany & Co. ad campaign, and Versace chief creative officer Donatella Versace. All of these brands have courted Chinese consumers' anger in recent months. Jonathan Bachman/Getty Images; Dolce & Gabbana/Instagram; Evan Agostini/Invision via AP
The NBA this week became the latest in a slew of foreign brands who have landed in hot water in China.
Dozens of Western brands have angered Chinese consumers with their marketing or public statements, and many still appear to be struggling to learn their lesson at high costs.
Though the mistakes range from apparently racist ad campaigns to a failure to represent China's perceived borders, it all boils down to one fundamental misstep, experts told Business Insider — a lack of respect.
"People underestimate what the Chinese consumer feels and thinks," said Fenella Barber, founder of Bao business-relations advisory. "We assume from the West that this authoritarian state is sitting heavy on China [...] there's just more to the debate than that."

The NBA faces a billion-dollar crisis in China as all of the league's partners in the country suspended their ties over Houston Rockets General Manager Daryl Morey's tweet in support of the Hong Kong protesters, and basketball fans threatened to boycott its games.

The league is learning what many Western brands have in recent years — that China is an immensely difficult market to cater for.

In recent months, a slew of companies from Dolce & Gabbana to Marriott International have had to apologize to Chinese consumers — for reasons from displaying maps that exclude Chinese-claimed territories, to showing seemingly racist ads — or risk losing billions of dollars in revenue.
Chinese shoppers sit in front of the designer Miu Miu store in Beijing in 
August 2015. Kevin Frayer/Getty

Some of those apologies have failed to stick, however. D&G, once a popular brand among China's middle class, has suffered from weak sales in the country for months after the fashion house depicted a Chinese model struggling to eat Italian food with chopsticks in a November 2018 ad campaign.

Business Insider spoke to two experts to understand why China is such a fragile market, and why so many Western brands still appear to be struggling in the country. Both declined to directly discuss Chinese politics due to the sensitive nature of their work.

'It's about respecting your market'

Here are some examples of how brands have landed in hot water in China in the past year alone:
D&G's ad campaign last year appeared to mock Chinese culture. Amid the backlash a woman also published screenshots appearing to show co-founder Stefano Gabbana making racist comments about Asians.
Brands including Versace, Swarovski, and Calvin Klein referred to Hong Kong, Macau, and Taiwan as Chinese territories. (Hong Kong and Macau are semi-autonomous Chinese cities. Taiwan is a self-governing island which China claims as its own.)
Tiffany & Co published an ad campaign that depicted a Chinese model striking a pose similar to a symbol of the Hong Kong protests. Though the company said the photograph was shot in May — before the protests even began — the campaign was released in October, at the height of the tensions.

All of these cases show one fundamental misstep done by the brands, Chinese consumer experts say: They all appeared to show a lack of respect and knowledge of the country's culture and politics.
A screenshot from a Tiffany & Co ad campaign, which featured a Chinese model striking a pose similar to that used in the Hong Kong protests. The company has since removed the ad campaign. Tiffany & Co.

The majority of Chinese consumers are patriotic and willing to punish people who mock them — like consumers in any other country would be, said Fenella Barber, the founder of Bao Advisory, a business-relations advisory based in London and Shanghai.


"They're [Chinese people] proud of where they've come to," Barber told Business Insider, referring to the country's economic and social development into a superpower. "If they feel put down for whatever reason by a foreign company, they're quite happy to jump on the bandwagon."

"But where they [companies] are targeting the money and they do bad advertising, and to be honest, that's just a lack of respect," she said, referring to the D&G ad. "They haven't really understood the market and they've done a pastiche of China in some way and expect that to work. That's just — really?"
A Dolce & Gabbana ad campaign in November 2018 showed a model 
eating traditional Italian food with chopsticks. Dolce & Gabbana/Instagram

The Chinese government has also weighed in on some of these controversies in the past — the Chinese Consulate in Houston criticized Morey's tweet, for example — but most of these brands had been rowing back their comments to appease consumers, rather than the Communist Party.

China's leaders and citizens are particularly sensitive about issues of sovereignty — like Hong Kong, Macau, and Taiwan's perceived place in the country — and many foreign brands have had to issue apologies highlighting their respect for China's borders.


"[Sovereignty] is incredibly important to the Chinese people [...] so to have someone else be flippant about it" is particularly offensive to them, Barber said.

"Chinese soft power might not work well internationally, but it works very well at home," she added.

Read more: China is waging war against a cafe because it served coffee to Taiwan's president
—Norman Hermant (@NormanHermant) October 7, 2019



"You cannot separate politics and culture any more than you can anywhere else," Domenica di Lieto, CEO of digital marketing agency Emerging Comms, told Business Insider.


"For example, Brexit is a political, legal, business, and social story that incorporates a range of views from other sides, with many based on inherent beliefs. People have to respect that."

"It's not really political, it's about respect," she added. "It's about respecting your market and your consumers and understanding them, and understanding the motivation, and being very clear that you understand them."

Barber added: "I think people underestimate what the Chinese consumer feels and thinks. They're not all put upon. I think we assume from the West that this authoritarian state is sitting heavy on China — I think there's just more to the debate than that."

Di Lieto noted, however, that public criticism of brands who have shown apparent disrespect to consumers isn't unique to China. Last year, BECCA Cosmetics received widespread criticism on Twitter after people accused it of darkening a white model's skin tone to demonstrate the deeper shades.
People hold up their phones to record fireworks during China's National Day celebrations in Beijing on October 1, 2019. This year also marked the 70th anniversary of the founding of the People's Republic of China. Aly Song/Reuters
The Chinese are buying on their own terms now

The Chinese market can bring huge revenues — mainland consumers spent 170 billion yuan ($23 billion) on luxury goods alone in 2018, according to consultancy giant Bain & Company — but it's also one of the trickiest to capture.


Foreign brands can no longer operate on the belief that just because their campaigns work in the West, they will in China too, both experts said.

"For a long time, people were happy to buy Western products or a Western idea," Barber said. "That's not necessarily true anymore. In China's case, things are changing, and the nuances haven't necessarily changed within the Western businesses' mindset."

"China doesn't like to be seen as a cash cow," she added.

"China wants to be welcomed into the world and its people want to be given respect. The other thing that's often misunderstood is that Chinese don't necessarily want to buy into the whole American, Westernized dream, and the West is quite slow to catch on to that."


Di Lieto also said: "For years Chinese consumers have been very patient with Western companies that have benefitted hugely from their income while not always giving appropriate consideration to their culture."

But now, Barber says, "the Chinese are patriotic, nationalistic, happy to come down strong on a Western company if they upset the national image."

Read more: The NBA has already felt 'economic impact' from Daryl Morey's pro-Hong Kong tweet — here all the moves that have been made by China

The Chinese are huge shoppers: Here, packages await delivery at an unnamed distribution center in the country ahead of Singles' Day, the country's version of Black Friday. VCG/Getty Images

Foreign brands are learning — at huge costs — that the speed and method of rowing back comments are affecting their market.


The NBA risked billions of dollars in advertising and broadcasting rights not after Morey deleted his tweet and distanced the team and league from his views, but after Commissioner Adam Silver defended Morey's right to freedom of expression.

Di Lieto said: "A lot of crises escalate because of a lack of apology by the right person with the right sentiment, and there's no point in an apology that sounds like you're just reading off a script either," she added.

"Chinese consumers will see straight through that. The same applies in all countries."

"If the market is important to a company, and where the money is really big it should be ... [that] you just need to tread a bit more carefully and not to treat it so lightly, to give the time and attention to do things properly," Barber added.

Houston Rockets GM Daryl Morey. Bob Levey/Getty Images

Some brands have foregone the Chinese markets to make a political stand, though.

After Beijing banned "South Park" from the country's internet over an episode that addressed government censorship, the comedy show's writers show issued a mock apology and wrote a new episode in which character Randy Marsh says: "F--- the Chinese government.