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Monday, 17 November 2008

GG RADAR: Mid-November 2008

Some interesting reading:

  • Piracy reaches a modern milestone. Somali pirates seized a Saudi (ARAMCO) super-tanker off the coast of Kenya (area in the region now under threat of piracy is estimated at 1.1 m square miles). The holes in the global security system are so big now, that you can drive a super-tanker through them.
  • Hilarious. Envisioning the lair of the 4GW super-villain.
  • Still looking forward to the Boyd Conference on PEI (Prince Edwards Island) in December.
  • Fraying social situations. Rapid rise of poaching gangs in the UK. The elderly crime wave in Japan (retirement = economic failure). Both are a glimpse at the near-term future of the US.
  • The Sendero Luminoso (Shining Path) in Peru recast as a criminal/guerrilla group. The bazaar of violence spreads as the distinction between guerrilla and criminal fades (see "Illicit" and "McMafia" for details on how these transnational criminal markets emerge).
  • Rich Mexicans spend more on bodyguards as security deteriorates. Excellent quote by a Mexican businessman: “One bodyguard, two bodyguards, even three of them can’t do anything with these criminals, who come in groups of 20 with high-powered arms. If they want to hunt you down, they will get you.” This is going to be a gold mine of an industry in the US by early in the next decade.

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Comments

Re: "Envisioning the lair of the 4GW super-villain." and "His hidden fortress is in the network, represented only by a briefcase, or perhaps even just a mobile phone."


"It's the oldest established, permanent, floating crap game in New York."

If 20% of the shipping fleet aren't needed anyway, maybe there no problem losing a tanker here and there ;).
Are those things insured?

They are most certainly insured. Probably with Lloyds of London, like most of the world's fleet. That's not the problem. Even the lost oil isn't really the problem.

The problem is that supply lines are getting longer. What could once be carried to it's destination in 2 days can now take 12 days or more, due to supply shortages at closer locations (Mexico, Venezuela). That means 6x the number of tankers are needed to maintain the same level of supply.

More shipping over longer distances means increased risk of piracy, which means higher insurance premiums and more frequent supply disruptions.

This is the exact scenario that came to my mind when it became known that Iran was leasing tankers as storage facilities. It removes tankers from the rotation, increasing the impact of every hijacking.

ChristianK,

The answer is that they are insured to an extent. I have no direct knowledge of the particulars of this case, but I do know a bit about Lloyds and Marine Insurance, and we were chatting about it in the office the other day (before this particular hijacking).

For us the key thing is the 1906 Marine Insurance Act which governs a pretty large chunk of the thinking on marine insurance. I'm going to jump the complexities (they get pretty damn complex) and say that the bottom line is that once the claim is agreed the many and various syndicates that make up the Lloyds market own the ship / wreck and cargo. Double insurance is always an issue and there are some mathematical formulas to work out who gets what, but it is covered. To an extent.

The situation is made more complex as the bigger companies tend to self-insure these days or run it through places like Bermuda which don't operate to UK standards. Even in the UK there are even clubs which cover the parts of a ship that insurance won't (Marine insurance only covers 75% of a ships hull). Big companies can afford the additional risks that this kind of thing entails, whilst saving money in the short term, in theory this money gets saved up to pay for any claim later on.

Before we get flustered let's not forget that piracy really isn't is a big problem in the lives of marine sailors and insurance brokers. Its exciting because its rare. From the point of view of the UK as a whole there is no UK merchant fleet as such so its quite rare that our ships and seaman are bothered, because there aren't that many. The UK relies on imports and exports from the sea, and probably always will, but pretty much everything is carried by foreign ships and foreign sailors, normally under flags of convenience - these are cheap as chips and about as expendable.

The odds of piracy are vanishingly small - 22,000 vessels pass the Somali / Yemeni chokepoint each year. Around 1 in a thousand gets pirated successfully. That's roughly the same odds as being wrecked each year. Of course any Westerner would look at a possible death rate of 1 in a thousand in a wreck and think "hang on", which is why most ship crews are 3rd worlders. Actually if we were worried about the safety of sailors as a whole we'd start with a good solid crackdown on flags of convenience and improve maritime safety. That would be way cheaper than having military forces playing silly buggers near Somalia, but nowhere near as Top Gun.

Which brings us to the reason we're getting excited now, the Royal Navy wants to show off. The Royal Navy's been pretty damn useless in Afghanistan and Iraq over the last decade, so they need something to prove that they have a role at budget time and if a couple of raggedy-ass Somalis are the opposition, then so be it. Still, the big-gun men of 1939-45 must be turning in their graves. You may wonder about the costs of all this - HMS Cumberland costs around £200k a day to run and it cost £100m to build in the 1980s. Her successor is estimated to cost nearer £1bn.

That said we have some reason for excitement - the Sirius Star hijack does mark a high moment in modern piracy. This is the first very large crude carrier to be hijacked in the current wave of piracy in the waters off East Africa. VLCCs are huge. The only thing up from this would be an actual warship.

Ironically the attack came just after the Combined Maritime Forces task force had announced success... they had reduced the percentage of successful piracy attacks from 53% in August, to 31% in October. Victory is in sight - the pirates win only a third of the time... Huzzah!

Earlier in November Royal Marine Commandos operating off of HMS Cumberland had shot dead 2 pirates in a combined UK / Russian operation under the banner of the Combined Maritime Force. Of course on the same day a Turkish tanker was seized in the same area.

Geography is not kind to mariners in this case. Somali and Yemeni pirates are right on the narrow strait at the southern end of the Red Sea, which carries all the traffic between the Suez Canal and the Indian Ocean. A choke-point plus anarchies equals piracy. Impressively this area isn't the worst area of piracy, the Singapore Strait is even worse and has been called a war-zone (meaning that if you're pirated out there Lloyds probably ain't paying!).

Still with the collapse of any Somalian government following a recent US backed invasion the Somali coast is pirate heaven, mostly based out of the "pirate port" of Eyl. The pirates make their money from ransoms rather than reselling ships and cargoes. Ransoms are simpler and more profitable, plus there is a lack of buyers for genuinely pirated materials these days because its pretty easy to get caught.

Overall this is a high water mark, but its not going to cause the collapse of Western civilisation. As a story its also more about justifying some incredibly expensive Naval kit by saying that they have a real-world role to play, just like the Army does.

Tuesday, 18 November 2008 at 02:26 AM

Thanks for the background and analysis. It does help to put the ongoing piracy in perspective. I am ex-army myself, and have no idea how a small pirate vessel can capture a vessel as large as VLCCs - it would seem to me that angle from of shooting from well below the bridge of the VLCC would make effective fire very difficult with small arms and even many crew served weapons. Do you know what type of armaments the pirates have at their disposal?

Thanks.

I recommend the Sea Rover's Practice, which is a historical review of pirate strategy/tactics/organization. Small boat swarming is typical.

http://www.amazon.com/exec/obidos/ASIN/1574889109/ref=nosim/globalguerril-20

I also agree this is more theater than a real problem. Just another sign of deteriorating security.

Christian, thank for your input. It seems that "complexity" is insuring much of our demise. In this case nothing could be more complex than military equipment which does somewhat better against the Soviet Navy or WW II German Navy. Add insurance, NATO, and world governments and you've got a prescription for NO SOLUTION. This is just another nail in the decline of the state. However, solutions will be found and they won't involve governments. Most of us (including the former government employees amongst us) are not so wedded to the state that we can't get along without it.

An easy fix to much of this nonsense, as Rich mentions with some consternation, would be arming the crew. The very idea makes my friends with government jobs scoff and think of me as mad. Apparently one must have 16 weeks of bad military training at a government facility before they can fight for themselves. Of course there's simply no way for the calcified Navies of the world to prevent much of this piracy, and that makes the people with government jobs (and their "letem' eat cake" attitude) largely irrelevant.

After following events at the G-20 summit it's clear to me that the party is just beginning. Mexico is the model for the future.

"Alarm grows as governments and navies are rendered legally powerless to conduct security operations on the high seas"
http://www.timesonline.co.uk/tol/news/world/africa/article5183710.ece

And right on schedule the Times makes my case. It's going to be interesting to see what the world does without US leadership. I suspect, "NOTHING". Some will see this as a victory of Islam over a decrepit Wes. The West is definitely decrepit but Islam survives off of our leavings. How can they survive and prosper without us? This tanker was a Saudi registered ship. The Saudis have never been able to defend their own Kingdom. It remains to be seen how long they go on before chaos swamps them.

Please use reason.

Anecdotes do not constitute a data set.

Most of the examples you site are examples of the consequence of not acting to maintain order. Mexico has been in a state of decay for decades. Please recall our illegal problem. Piracy is an issue because no one is committed to enforcing laws. A problem endemic to Africa for decades. We are currently seeing a flare-up. I could go on.

Building a theory is not about rummaging selectively through data to find instances of confirmation.


En,

There are a few problems with the Times article. Mostly because its unfortunately complete cobblers. I suspect that a couple of Royal Navy lads have got there first as Libby Purves (a columnist) was coming up with some complete drivel the other day too:

http://www.timesonline.co.uk/tol/comment/columnists/libby_purves/article4931234.ece

An unfortunate reality is that the Maritime Combined Forces (of which just one part is Combined Task Force 150, aka CTF 150) has no real legal footing. The whole thing was set up in the wake of 9/11 to deter terrorism but has no powers to stop and board vessels, and no-one is rushing to hand that kind of power over to the Americans ("stop our ships whenever you want... I don't think so").

But (and its a big but) piracy is different. The UN Convention on the Law of the Sea has quite a lot to say about piracy - particularly the bit giving warships free reign to hunt down pirates. Oddly the Times doesn't mention that critical and long-standing bit of international law.

Which brings us to the French. The French have mounted aggressive raids against the Somalian pirates, including a full-on at-sea hostage rescue run by "Commando Hubert" in September. Back in April the French ran an operation against the money men, arresting 6 of them and flying them out to France from their massive naval base at Djibouti.

Oddly the Americans and British choose to ignore the fact that the French are rather tougher than they are on this one. Its probably best not to mention it. Of course I'd point out that a 30-man team of commandos, backed by a frigate, in a ten-day operation is a shed-load more cash than the £0.75m ransom demanded.

Part of the problem is that taking a ship is a complicated thing - they are small, cramped, with any number of angles that need covering. A small team of really serious soldiers is needed, and all of the serious soldiers in the British armed forces are either in Iraq or Afghanistan or getting ready to go back. Less experienced soldiers would simply machine-gun the decks then land and then use hand-grenades to flush people out. You'd better be damn sure you've got the right people before ordering that, and if hostages are involved... well I can remember people mocking the Egyptians for their snipers blasting civilians by accident.

The days when we could issue any Jolly Jack-Tar a cutlass and a tot of rum and have him leap aboard a French vessel in a blaze of murderous fury are, sadly, over.

"It's going to be interesting to see what the world does without US leadership. I suspect, "NOTHING"."

I'm not sure how answer this other than to say:
a) the pirates operated quite cheerfully during the period of "American Leadership", assuming that this means the recent period of incompetent US government under George W. Bush which is now, thankfully, coming to an end
b) The Combined Maritime Forces are closely connected to the US navy, specifically the US 5th Fleet, as part of the overall US invasion of Iraq (the CMF's main role is supporting the Iraq invasion). That said if memory serves the current commander of the CMF is a Dane, but that's alliances for you.

Addendum: My notes say that Commodore Per Bigum Christensen currently commands CTF 150 - he's from the Danish Royal Navy.

"Some will see this as a victory of Islam over a decrepit Wes."

Even I'm saying that this is a minor piece of slow-news-day silliness backed up by some pretty desperate briefing that 'the Navy has a role to play' and I'm normally pretty phlegmatic about local people shooting invaders.

"The West is definitely decrepit but Islam survives off of our leavings. How can they survive and prosper without us?"

Well, Islam as a political entity is a big place, from Europe to the Far East, covering around one-sixth of the human race. Assuming you mean just the Middle East, they have oil. They have China and India. Oil->China and India. They have cash money. We need cash money. Cash->Us.

"This tanker was a Saudi registered ship. The Saudis have never been able to defend their own Kingdom. It remains to be seen how long they go on before chaos swamps them. "

Can't help but think you're reading a lot into this, Saudi will collapse for a number of reasons, but not this one. Last week it was a Danish ship, a few weeks before that a Turkish tanker. Neither Denmark or Turkey is in any danger of collapse. Its piracy, but some people who are either doing this or starving, not an invasion of the nation-state.

"a) the pirates operated quite cheerfully during the period of "American Leadership", assuming that this means the recent period of incompetent US government under George W. Bush which is now, thankfully, coming to an end "

Bush has been done for six months or more and it's clear to me that the US fleet ain't getting much direction. This reminds me very much of what happened in the Balkans. The locals can handle this just fine but it's easier to sit back and look for someone else to pay for it. I'm betting because of the US economic situation there won't be any Balkans type intervention. Still, I look at the fake Euro hand wringing and it looks all to familiar to me. I'm sure with all the former Clinton administration appointees returning with Obama there's a serious effort to repeat the Balkans "Multilateralism".

"Can't help but think you're reading a lot into this, Saudi will collapse for a number of reasons, but not this one."

I was speaking more to the Saudia call for "international action" then this one event bringing them down. It's a sign of what's coming, and yes, they were going to collapse anyway. However, the fact that they are asking for help will be seen as a sign of weakness in their own world and hasten the end.

As for the Islamic world, its big but poor, even with oil. Without the west they will get even poorer.

EN,

"Bush has been done for six months or more and it's clear to me that the US fleet ain't getting much direction. This reminds me very much of what happened in the Balkans. "

I agree completely. The Bush administration has, in the past six months, defined the phrase "in office, but not in power". There is an argument to be made that this is a good thing.

"The locals can handle this just fine but it's easier to sit back and look for someone else to pay for it."

Here I am more doubtful. The Balkans at least had the dubious luck of having the presence of rather too many governments. Somalia isn't that lucky, its a near-complete anarchy. The strongest group is probably the Islamic forces, they have lots of gun men.

"I'm betting because of the US economic situation there won't be any Balkans type intervention."

Agree completely. Plus of course, who would we send? It'd be easy to put together a Naval force, as they haven't got much work on, but the Army and (Royal) Marines have been pretty much exhausted by Iraq and Afghanistan. Add onto that the sheer area - Somalia has a coastline of over 3,000km. That's getting on for the size of the US Mexico border, which means it'd need a lot of troops, which we haven't got.

Overall the Russian suggestion for a land invasion, whilst fun, is a non-starter.

"Still, I look at the fake Euro hand wringing and it looks all to familiar to me."

Blimey, I'm a European (well, I'm English). There's no great desire over here to get involved in another quagmire like Somalia. We're sending a warship, but we've got loads and they aren't that busy. The nice thing about ships is that they can sail away as easily as they get sent.

"I'm sure with all the former Clinton administration appointees returning with Obama there's a serious effort to repeat the Balkans "Multilateralism". "

The Balkans were a special case - the Serbs are Russian allies and we're not taking on the Russians diplomatically without the Americans in the corner unless its actually important.

Also within that we can't really talk about a European response to the Balkans as the UK military and politicians rather liked the Serbs (terribly nice chaps, always looked good on parade, speak good English... I am, sadly, serious the British General sent to assess the two sides at the start of the war thought the Serbs would soon beat the Bosnians because the Serbs were better at playing dress-up).

http://www.amazon.co.uk/Unfinest-Hour-Britain-Destruction-Bosnia/dp/0140289836

Plus if you really want to make every European capital panic use the words "Trouble in Sarajevo". We all remembered that World War 1 started there, so no-one was rushing to get involved.

Stratfor, in "The Barrio Azteca Trial and the Prison Gang-Cartel Interface," details how Mexican drug gangs are uniting with American prison gangs.
http://www.stratfor.com/weekly/20081119_barrio_azteca_trial_and_prison_gang_cartel_interface

Besides detailing how the prison gangs work with the Mexicans, the article also shows how American prisons, far from serving as a deterrent to gang activity, actually serve as recruiting grounds. Prisoners, to shield themselves from violence, need to join these gangs, with which they continue to belong after they have been released.

On the whole, the best strategy to promote global guerrilla activity within the Americans and within the USA in particular, would be to render a highly addictive substance illegal and then funnel its users into prisons, where -after having been alienated from mainstream society - they can organize.

This is a consequence so predictable that it is puzzling - given the ingenuity of our Wall Street financial engineers - that we lack a futures market allowing us to trade derivatives based upon fluctuations in the resulting criminal activity.

Despite the sloth of our financial engineers in having failed - so far - to have developed drug gang derivatives, other white collar workers are reportedly developing global guerrilla expertise.

Paying ransom to Somali pirates requires special expertise. According to the Guardian, "The mechanics of those transactions are fraught with risk. How do you deliver large amounts of cash discreetly to a band of pirates on the high seas? Most maritime security experts involved in the trade are reluctant to talk, but there appears to be more than one method, and the name of the game is cautious improvisation."
http://www.guardian.co.uk/world/2008/nov/19/piracy-somalia1

The Guardian adds:"There are some law firms that specialise in this and the kidnappers have contacts there," Inaki Latxaga told a local newspaper earlier this year. "I think anyone can judge for themselves the actions of these firms, because sometimes you have to ask yourself whether the pirates are in Somalia or in London."

"the best strategy to promote global guerrilla activity within the Americans and within the USA in particular, would be to render a highly addictive substance illegal and then funnel its users into prisons, where -after having been alienated from mainstream society - they can organize. "

And right on time we have the Obama, who most college kids told me was going to leave their weed alone, aministration's new AG.

http://www.reason.com/blog/show/130163.html
"Holder pushed for stiffer marijuana penalties when he was the U.S. attorney for the District of Columbia, and the details are strikingly at odds not only with Obama's signals regarding marijuana but with his opposition to long sentences for nonviolent drug offenders. According to a December 1996 report in The Washington Times excerpted at TalkLeft, Holder wanted "minimum sentences of 18 months for first-time convicted drug dealers, 36 months for the second time and 72 months for every conviction thereafter." He also wanted to "make the penalty for distribution and possession with intent to distribute marijuana a felony, punishable with up to a five-year sentence."

I'm under no illusions that McCain would have done better. In fact I could not vote for him because I believe his vision of the state would be a lot more detrimental to those living in it. On the other hand, a social democrat filled with mixed and fuzzy messages probably spells the end of the "old" US all that much quicker, but it will likely mean less violence. Although, that remains to be seen.

Duncan,

The Guardian has some good points but it misses the critical parties. The biggest insurers for Kidnap and Ransom are based in London, the largest of these is Hiscox. Hiscox, incidentally, advertises on UK TV (although not, I grant, for Kidnap and Ransom).

http://www.hiscox.com/ViewCMSPage.aspx?pageID=86e9bd39-a7e8-4471-9a05-631be9bc02ae

The people that do the leg-work for Kidnap and Ransom include Control Risks, which is the most famous, but there are others which are a lot quieter.

http://www.control-risks.com

Control Risks are led by a whole bunch of ex-SAS people, including General Sir Michael Rose. They also employ lots of big healthy lads, former spooks, and people with lots of experience of the 3rd world - particularly Mexico and the Middle East. These things are, of course, merely observations.

Control Risks does an annual talk at Lloyds on Kidnap and Ransom which is an absolute must attend. The stories can often be disturbingly funny. If you can't laugh at the kidnap of someone else's child, you shouldn't be in insurance.

As I have suspected, the credit crisis is indeed leading to an upsurge in loan sharking - at least in Italy.

"ROME — The worldwide economic downturn has opened the door for loan sharks to burrow ever deeper into Italy's vulnerable economy by preying on businesses that need quick cash and credit, according to a new report by a respected trade group.

Confesercenti, a business association that has tracked Mafia income for the past 15 years, found that the credit crunch has a particularly sinister side in a country of 58 million people that struggles with four large Mafia gangs -- the Cosa Nostra, 'Ndrangheta, Camorra and Sacra Corona Unita -- and other criminal enterprises.

In the past year, 180,000 firms in an economy dominated by small businesses apparently have succumbed to loan sharks, in part because they no longer can qualify for bank loans, according to a report released last week in Milan. "Shop owners are really falling into the trap," said Marco Venturi, head of the association that produced "Crime's Hold on Business.""

http://www.chicagotribune.com/news/chi-italy-mob_spolarnov21,0,2387057.story

Russia talking land invasion of Somalia? Excellent. Encourage them. If they succeed we all benefit. If they fail, it's status quo going forward.

Somalia, like Rwanda, is a case of population overshoot of local resources. Look up the fertility rate: children born per woman.

---

Obama's AG and penalties for MJ: Obama is deliberately bringing onboard people who disagree with him. In part to challenge him, and in part so he can hold them to performing in their subordinate roles after he makes his decisions.

I seriously doubt Obama's going to be persuaded to go for stiffer penalties for MJ. Folks, get real: pot is almost a non-issue given the emergencies breaking out on all fronts. They may as well legalize it for the economic stimulus and tax revenues it will produce.

---

Re. the gang problem: Release all nonviolent offenders from prison into monitored probation, and then put gangsters away for life w/o parole. Subject them to "civil death" provisions that deny them all contact with the outside world aside from their attorneys. Confine them one person to a cell in a kind of supermax environment, so they can't spread their memes.

Something else occurs to me however.

Sterilization via surgical castration, as a penalty for violent crimes.

The point being, anyone who does those kinds of crimes should be forbidden from becoming a parent, just as they are forbidden from possessing firearms. But the added message is: if you run with a gang, you'll get your bollocks lopped off. I can't think of a better deterrent for testosterone-crazed madmen from an ultra-macho culture.

This is not the cutting off of hands prescribed by Sharia law, or any of that barbaric nonsense. With anaesthesia there would be no pain. And unlike your hands, your bollocks are not needed for everyday tasks, and when you have your clothes on, no one can tell you're minus a pair.

And in a practical sense, de-balled gangsters aren't going to spawn another generation of gangsters, so the problem with grow numerically smaller by a measurable amount with each generation (about 15 years for gangsters).

Yeah, I'm serious.

"MOGADISHU, Somalia, Nov. 28 -- Ethiopia announced Friday that it will pull its forces from Somalia by year's end, leaving the ravaged capital vulnerable to the Islamist fighters who have seized nearly all of the country.

The decision ends the unpopular two-year presence here of the key U.S. ally much as it began -- with the fighters in near-total control of a failed state beset by a worsening humanitarian crisis.

http://www.washingtonpost.com/wp-dyn/content/article/2008/11/28/AR2008112802657.html"

"The latest [Somali pirate] attack, in which even trained security personnel aboard could not deter the pirates, demonstrated the urgent need for coordinated action by governments from Cairo to Berlin. But the bureaucratic and legal hurdles facing international institutions and national governments have so far defeated most efforts to deal with the nimble crews of pirates in speedboats, whose tactics have grown bolder as their profits have paid for better weapons and equipment.

"While the pirates have been buying GPS devices, satellite phones and more-powerful outboard motors, officials in Europe have been discussing jurisdictional issues surrounding the arrest of pirates on the high seas and even the possibility that the pirates might demand asylum if brought onto European Union shores."

http://www.nytimes.com/2008/11/29/world/europe/29pirates.html?ref=world

Renewable And Clean Energy Program

"Wright State University and the University of Dayton, in collaboration with the Air Force Institute of Technology and Central State University, are developing Masters Degrees in Renewable and Clean Energy. These programs will provide students with knowledge of a number of renewable and clean energy technologies that exist today such as: solar energy, wind energy, hydropower, fuel cells, hydrogen fuel, clean coal, and nuclear energy. In addition, the programs will educate students in the science of energy, its conversion, as well as energy efficiency. These new programs will provide the State of Ohio and the United States a supply of future engineers and researchers in the critical field of energy. In addition, they will stimulate collaborative energy research among the four institutions. The full proposal for these degrees, as well as the CV's of participating faculty, are available below."

http://www.engineering.wright.edu/mme/energy/

And from the Department of Comic Cock-ups department we give you the Indian Navy.

Back a couple of weeks the Indian Navy proudly claimed that they had destroyed a Somalia Pirate Mothership.

This weekend the Thai owners of the ship that was delivering fishing equipment to Yemen have asked for compensation for the mainly Thai crew that was aboard - 14 of whom are still missing, presumed dead. We have 1 survivor, and one confirmed dead. The Indians wandered off before checking the area of survivors.

In short the Indians blew apart a whole bunch of victims and then went back to doing whatever it was that they were meant to be doing. Now a while back on this thread I said that semi-competent navies would have storm a ship using hand grenades? I had forgotten that totally inept navies will shell the ships. Innocent victims? Sod them. Whoops.

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