Tuesday, September 30, 2008
Iraq Today
September 22, 2008
Rebuilding Iraq: Anbar ProvinceBy John Matel
RealClearWorld presents a special series of original, exclusive blog posts by the boots on the ground in Iraq - Baghdad, Anbar Province and beyond. These bloggers include American Marines, soldiers, support personnel and government administrators. The posts also feature exclusive, on-location photographs of Iraqi lives as seen through the lenses of the bloggers.
These posts are provided exclusively to RealClearWorld by the U.S. Department of State. The views expressed in these posts are the bloggers' own sentiments.
Rebuilding IraqPart One: Anbar Province
My name is John Matel and I am the leader of a U.S. Provincial Reconstruction Team in Anbar Province, Iraq. A lot has changed in Western Anbar since I arrived here almost a year ago and as my assignment comes to an end, I can appreciate them.
The first big difference is the physical appearance. Last year much of this province looked like what it had recently been – a war zone. Shops and homes were boarded up, in ruins or flattened. People looked shocked and sullen. Anbar is still not up to what most of us would consider acceptable standards, but improvements are phenomenal and the change palpable.
Along the whole Western Euphrates River Valley (WERV) and into the desert oasis cities of Nukhayb and Rutbah markets are open; streets are busy; the shops are full of goods; things are happening. We used to use a “banana index” where we looked at produce in the shops as a proxy for goods being available. Bananas available that were not green or brown indicated a decent distribution network. Today that index is overtaken by events, since shops are full. We now are thinking of going over to a “gold standard” since we now see gold and jewels in shop windows and assume that the owners must feel safe enough from both insurgents and ordinary crooks to be so confident.
Security is increasingly taken for granted by many people and now they are moving on to other concerns, such as economy, traffic and building their lives.
We have much more freedom of movement. I didn't do my first market walk until January of this year. Now we walk in the Iraqi markets on almost every trip, talking to people and finding out about their hopes and problems.
A year ago there were serious fuel shortages. While problems remain (many resulting from government controls on prices and supplies), the refinery at K3 in Husaybah is up and running. This seemed like an impossible dream when I first saw the place a few months ago. K3 produces naphtha, kerosene, benzene and heavy fuel oil. It is still not up to 100% production, but it is way up from ... nothing last year.The crude oil arrives from Bayji by rail. This railroad was not working and was not secure just a few months ago. I remember flying over the rail/highway route in a Huey, with the narration being that it could work, but there were lots of challenges. Getting the rail system up and running is another great accomplishment of the past year. This will essentially clear the lines all across Anbar.
I don’t often see this progress reflected in news reports. I recently saw a CBS segment from 2007, which I suppose reflected the situation at the time. But it is amazing how much things have changed and some mention of that in the follow up segment might have been nice.
The segment shows the bad old days in Hadithah. They said that most people in Hadithah are hostile to coalition forces. Back then maybe; today things are different. I walk through Hadithah a lot. If people are hostile, they don’t show it. People smile and wave at us. I frequently stop to talk to shopkeepers and pedestrians. Not only have I encountered no hostility, but many people thank us for the security we have brought to the place. I have featured pictures of my walks through Hadithah on many occasions.
Sometimes dumpy; no longer scary.
We accomplished a lot. We have created options. At the end of 2006, it was hard to believe success in Iraq was possible. Some thought that our only option was to get out as soon as possible – to end the war by accepting defeat. I disagreed at the time because the consequences of failure in Iraq were too terrible to accept, but I admit that I did not see a clear way forward. I greeted the news of the surge with more hope than real expectation. By the time I volunteered to go to Iraq, about a year ago, I thought that things had turned around, but I expected to be thrust into the middle of a war and I was not sure we could be successful. I never expected that only a year later we would have almost annihilated Al Qaeda in Iraq, neutralized the insurgency and seen such progress and prosperity return to the towns of Anbar - back then called the most dangerous place on earth. Of course, I didn't really know the Marines so well back then and I didn't know the people of Anbar at all. THEIR achievements have been astonishing.
Rebuilding Iraq: Muthanna ProvinceBy Aaron Snipe
RealClearWorld presents a special series of original, exclusive blog posts by the boots on the ground in Iraq - Baghdad, Anbar Province and beyond. These bloggers include American Marines, soldiers, support personnel and government administrators. The posts also feature exclusive, on-location photographs of Iraqi lives as seen through the lenses of the bloggers.
These posts are provided exclusively to RealClearWorld by the U.S. Department of State. The views expressed in these posts are the bloggers' own sentiments.
Rebuilding IraqPart Two: Muthanna Province
Muthanna Province, roughly the size of the State of Maine, has a population of 700,000 and is Iraq’s second largest province. Though large in size, it is the nation’s least economically developed. Sharing a border with Saudi Arabia, it is in the Deep South where temperatures can reach 140 degrees. Unemployment is high and agriculture (livestock, dates, rice, and wheat) support the livelihood of many of the province’s residents. Cement, brick, and salt factories comprise the industrial capacity of the province.
While the residents of Muthanna, like almost all Iraqis, certainly wonder when the U.S. will leave Iraq, the question that is first on the minds of folks here is, how can the U.S. help us? The province was largely ignored by the Saddam regime. This means much of the work the PRT is doing to help the people here is well received. Whereas essential services were destroyed or disrupted by war and sectarian violence across much of Iraq, Muthanna simply did not have these essential services to begin with; in many cases, we helped provide these essential services to the residents of Muthanna for the very first time.
PRT Public Diplomacy Officer Aaron Snipe hands food to a widow in Rumaytha City, Muthanna, during the holy month of Ramadan.
Understanding Iraq and the development challenges at the provincial level is a Herculean task. While I cannot speak for the policy-makers in Washington, I can speak for the members of my PRT when I say that we are making a difference in the lives of the residents of Muthanna. I have also come to know that the contributions we make here will probably never reach the ears and eyes of most Americans back home. Providing Arabic books to needy schools in rural Iraq won’t make headlines back home, but it makes news in Muthanna, and more importantly, a real difference here on the ground. Food distributions to needy families during the holy month of Ramadan is common in Iraq and across the Middle East, but when a U.S. diplomat welcomes the needy ��" in Arabic ��" and is the one handing out those bags to widows, people here take notice. Clearing fields of garbage and scrap metal to make way for soccer fields for the youth of Muthanna is a small monetary investment for our PRT, but one made in the name of Iraqi youth that is, without a doubt, worth any amount of time and effort.
Muthanna is an agrarian society at heart and some of our most meaningful efforts are focused in this sector. An example of a project that is making a significant difference in the lives of local Iraqis, but not making headlines, is our effort to help farmers replenish their fleeting livestock numbers. Decades of neglect under Saddam, years of war, and other economic factors have forced many of Muthanna’s farmers to slaughter their livestock for food to feed their families, while stripping them of their main source of income.
The dwindling numbers of breeding bulls have created an agricultural and financial crisis for Muthanna’s farmers. With a PRT-inspired, Iraqi-led program in place, the numbers of livestock will certainly increase. Now, I am painfully aware that this is not a story that sells itself. How do you turn this project into a high-gloss "success story?" Answer: You don’t. But guess what? We don’t really care if the folks back in Washington can’t make a brochure out of this one. Just ask the Iraqi agricultural officials who recognize that this program is helping revitalize a vital part of their agricultural sector, and their economy. They’ll tell you this vital program is no BS.
I know books, soccer fields, and food won't solve all the problems of Iraq. But our mission here is to supplement Iraqi efforts, not solve every problem. We are here doing important work and, in a short amount of time, I can see with my own eyes that we are making a difference. I am happy to report that Muthanna continues to be an oasis of stability in these turbulent times.
Rebuilding Iraq: Babil ProvinceBy Ken Hillas
RealClearWorld presents a special series of original, exclusive blog posts by the boots on the ground in Iraq - Baghdad, Anbar Province and beyond. These bloggers include American Marines, soldiers, support personnel and government administrators. The posts also feature exclusive, on-location photographs of Iraqi lives as seen through the lenses of the bloggers.
These posts are provided exclusively to RealClearWorld by the U.S. Department of State. The views expressed in these posts are the bloggers' own sentiments.
Rebuilding IraqPart Three: Babil Province
SECURITY IMPROVEMENTS PALPABLE BUT FRAGILE
I arrived in Al-Hillah in the beginning of March 2008, and the changes since then have been notable. The gains in security during that time are reflected in an improved quality of life for the province's citizens. Babil -- the most populous (1.6 million) province in the south central region -- is the keystone for the south central region. The U.S. maintains a Regional Embassy Office (REO ) in Al-Hillah, one of four in Iraq (together with Basrah, Kirkuk and Erbil). Babil is largely located between the Tirgris and Euphrates and has been Iraq's breadbasket as well as an industrial center. The northern part of the province lies within the so-called "Triangle of Death," south of Baghdad. This was a Sunni area lying on the Sunni/Shia fault line and the stage in which active fighting was still taking place until early 2008. An embedded sister PRT is paired with U.S. forces in northern Babil, where the changes of the last 10 months have probably been most starkly visible. A place like Jurf as Sakr, a Sunni majority town in northern Babil, was the scene of terrible destruction one year ago. I walked down the main street early this summer and was able to visit stores and talk to shopkeepers, escorted by only two soldiers at a distance.
NO SUBSTITUTE FOR ENGAGEMENT ON THE GROUND
The Al-Hillah REO supported three other PRTs, which for security reasons were not able to deploy to the provinces of Diwaniyah, Najaf and Karbala. This year all three of those PRTs are now based in their respective provincial capitals working closely with the provincial authorities to build governance capacity, pursue reconstruction and promote political reconciliation.
SOME IRAQIS RETURNING TO BABIL
Just a few weeks after my arrival in Al-Hillah, the REO compound was shelled twice. The REO compound adjoins a U.S. Army Forward Operating Base, where a battalion of the Third Infantry Division/Fourth Brigade is located. There were also several unsuccessful attempts to rocket our compound.
During the early weeks of spring, the Sadrist Militia, Jaysh Al-Mahdi (JAM), also known as Mahdi's Army, tried to destabilize the situation in southern Iraq with Iranian support and training. Militia groups attacked government and offices of the governing political parties, especially ISCI and Dawa. The Iraqi Security Forces responded forcefully and effectively, disrupting JAM's organizational structure and operational capabilities. It was at this time that Prime Minister Maliki decided to take back control of Basrah.
The fighting in Babil was not nearly as intense as in Basrah, and the ISF never lost complete control of any area of the province. Since that time, the incidence of IED and EFP attacks has dropped by several orders of magnitude. Stores remain open in the evening, and people no longer hustle home after dark. For the first time in several years, some women walk the streets of Hillah without headscarves. Numerous restaurants have opened and you now hear pop music in the streets that the Sadrist militia would prevent, preferring instead religious music. This year, 10 Iraqi expatriates returned to Hillah to take up faculty positions at Babil University, and several others have expressed an interest in doing the same. While we don't have good statistics on the rate of return, this is one indication that Iraq's intelligentsia, which had the ability and good reason to flee, are beginning to come home. WITH IMPROVEMENT COMES NEW CHALLENGES
To be sure, there is a real revival of economic activity in the province. Construction projects are ubiquitous. Numerous housing projects have popped up this year around Al-Hillah like desert wildflowers after the late winter rains. This has been both a blessing and a curse. As the economy revives -- with no small help from increased oil prices over the last two years -- the demand for electricity has grown sharply in Babil. Although the supply of electricity has also grown consistently this last year, the rising demand has maintained the shortages that plague much of the rest of Iraq. Power was available this summer sometimes for no more than six hours a day.
The PRT has been active in helping Iraqis kickstart their economy. At the PRT's initiative, a contractor helped the Iraqi Society of Fish Producers to reenergize this key economic sector with a targeted grant. Fish farming traditionally was a big money maker in Iraq, and Babil has been at the centerpiece. As a result, over five million fingerlings found themselves distributed throughout the province and in neighboring ones too, providing gainful employment to many young males who could otherwise be tempted to work for AQI or JAM.
Caption: Iraqis harvesting carp fingerlings in May 2008 outside of Hillah, as part of a PRT-inspired fish farm project.
A SHIFT IN PRT FOCUS: IRAQI MONEY FOR IRAQI PROJECTS
Until recently, the PRT's work focused on capital projects, using U.S. funding to build schools, roads, water treatment plants. That has changed. For a variety of reasons ranging from poor governance capacity to bureaucratic inertia, the provinces have not in the past succeeded in spending all of their budgets. We have now begun to use Iraqi funds to do this, while we provide the expertise for long-term planning, and operations and training in operations and maintenance of key infrastructure. This shift has not always been easy for the Iraqis or Americans, accustomed to doing business in the past, but it reflects the new reality. Fortunately for Babil Province, it has one of the best records in executing its budget, spending nearly all the funds allocated to it.
Caption: Women with their children line up to receive medical attention at a mobile clinic organized by the PRTs Civil Affairs Unit, in collaboration with Iraqi doctors.
THE TOWER OF BABIL: WHERE IRAQ'S PAST AND FUTURE COME TOGETHER
Today, the PRT's focus is to help the provincial government succeed in providing essential services to the population. Our aim is to strengthen the provinces capacity, not to be a substitute. We have established joint working groups to do long-term planning -- from capital infrastructure projects and water and sewage master plans to investment promotion and the development of tourism. Yes, there is potential for this. It's now possible to envision that one day Americans and others will visit this province -- the site of the Babylonian ruins, of the prophet Ezekiel's grave and of Abraham's home -- as ordinary tourists. It is a land that has witnessed death and destruction for several decades now -- several thousands of Shia were killed in Babil by Saddam Hussein's forces during the 1991 Shia Uprising -- but this is also a land with an incredible history to share with the rest of the world. The Babylonian ruins are just two miles from where I sit writing now, a reminder to me of what was and what could be.
Caption: A view of some of the Babylonian Ruins, which have not been excavated, or maintained, for many years long before 2003.
Return to the ArticleSeptember 29, 2008
Rebuilding Iraq: BaghdadBy Conrad Tribble
RealClearWorld presents a special series of original, exclusive blog posts by the boots on the ground in Iraq - Baghdad, Anbar Province and beyond. These bloggers include American Marines, soldiers, support personnel and government administrators. The posts also feature exclusive, on-location photographs of Iraqi lives as seen through the lenses of the bloggers.
These posts are provided exclusively to RealClearWorld by the U.S. Department of State. The views expressed in these posts are the bloggers' own sentiments.
Rebuilding IraqPart Four: Baghdad
It’s 117 degrees, you’re 8 or 10 years old, what’s the most fun thing to do? Go in the water, right? Or you’re 20 years old, madly in love, and desperately want a place to go and sit with your boyfriend/girlfriend without all the relatives around. Where can you go? How about a big park with lots of open space and benches? With plenty of places to hide?
Down at the end of the Karada peninsula, right along the Tigris river, the Iraqi government built a park in 2003, just before the war, that quickly became a popular entertainment destination for Baghdad residents. They came by the thousands to enjoy its two large lakes, playgrounds, open areas for walking, kiosks selling food, and even music festivals at night. Damaged and then looted during and after the war, the park was reopened by the Ministry of Tourism sometime after the initial fighting stopped, but the violence of 2005-06 made it impossible for people to get out an enjoy such luxuries as a park.
Again, the facilities were looted and deteriorated to the point that the lakes drained out into the river, rusting paddle boats and jet-skis collected in a corner graveyard, and nobody could enjoy it.
The brigade I work for set out to do something about this and put together a reconstruction project to renovate the pumps, refurbish many of the facilities, and get the park ready for people to use it again. Our contribution was to help broker a deal between the Ministry of Tourism and the next door University of Baghdad to resolve a property dispute, and then to help in several small ways to get the project completed.
Finally, on Friday August 22, everything was ready. This was in Karada district, and the district council there organized a big district festival. Officially, it was called Karada Day, although it really took place in the late afternoon and evening. (We fondly called it Karada-palooza, although Karada-vaganza was also thrown around.)
The festivities started with a “marathon” -- actually an 8 kilometer run through the streets of Karada ending up at the park. We got there around 4:30 in the afternoon and the first runners began arriving around 5:30 p.m., having run for the better part of an hour in 115 degree heat!
The only-in-Iraq part of the run came next. After the first few runners crossed the finish line, here came several hundred more, escorted by a phalanx of motorcycle cops and police trucks belching fumes into the air for the runners to breathe.
Everybody -- strong runners, wheelchair runners, kids gasping their way to the finish line, motorcycles, police trucks, even fire trucks -- tried to fit through the narrow finish line. Runners were careening off of pick-up trucks, wheelchairs collided with motorcycles, and race officials desperately tried to orchestrate the finish while dancing around the vehicles and runners.
Miraculously, nobody was hurt, and the runners were soon parading around proudly to the applause of many guests.
The inclusion of so many wheelchair runners was a nice touch, though it was sobering to realize that most of these participants were men who had lost one or both legs, most likely to terrorist violence.
Once the race was over, there were the usual speeches and ribbon-cutting that you would expect at an event like this. A small marching band played an Iraqi anthem, kids in costumes danced an Iraqi folkloric dance, and artists showed their wares at a small exhibit set up in the grass. Many of the runners, at least the boys, decided to test out the lake and found it greatly to their liking! One enterprising young man managed to get one of the jet-skis working and took turns giving rides to the younger kids. And once the formalities were over, people stayed for hours into the evening, and as we were leaving just after the sun went down, we could see hundreds of parents, children, and people of all ages streaming into the park.
In the language of post-conflict reconstruction, this was an important “return to normalcy” event. That residents of Baghdad could and did gather in such large and enthusiastic numbers for such a visible event really brought home how much security has improved in the capital and how strongly most of the people here want to live their lives free of worry over their basic security. We were not sure how this big event would turn out but as we left we knew it had been enormously successful in ways we couldn’t have predicted.
Return to the ArticleSeptember 29, 2008
Rebuilding Iraq: Baghdad IIBy Vicente Valle
RealClearWorld presents a special series of original, exclusive blog posts by the boots on the ground in Iraq - Baghdad, Anbar Province and beyond. These bloggers include American Marines, soldiers, support personnel and government administrators. The posts also feature exclusive, on-location photographs of Iraqi lives as seen through the lenses of the bloggers.
These posts are provided exclusively to RealClearWorld by the U.S. Department of State. The views expressed in these posts are the bloggers' own sentiments.
Rebuilding IraqPart Five: Baghdad II
Our ePRT 4 works in southern Baghdad province in a district (Qada) known as Mahmudiyah and includes the sub-districts of Yusifiyah, Lutifiyah, and Al Rasheed as well as Mahmudiyah. After 2003 and until early 2007, the area became known as the triangle of death because of the extreme violence carried out by Sunni and Shia extremists and assorted terrorists and thugs. Until last year, it was rife with kidnappings, murders, bombings, and other mayhem.
What a difference a year makes. Today, the 450,000 inhabitants of the district reside more or less peacefully together. Of course they are concerned about security and stability, but they now have time to think about making a better life for themselves and their families. Our Embedded Provincial Reconstruction Team (ePRT) works with Iraqis and help them to improve governance, foster economic development, provide essential services to the population, and promote the rule of law. We are embedded with the 3rd Brigade Combat Team of the 101st Airborne Division, the Rakkasans, on which we rely for security and other support.
Because of the greatly improved security, our team is able to operate relatively freely throughout the region, or Qada. I won’t kid you. This is still a volatile area. A few months ago, for example, a young female suicide bomber blew herself up near the town of Yousifiyah, killing an Iraqi Army captain and wounding several others. But security is vastly better. This Ramadan, in the past a time of increased insurgent activity, has been noticeably calm.
We have been taking advantage of this increased stability, and are partnering with the Iraqis in providing essential services to the population of the province.
The district will not be able to satisfy all the pent-up demand for basic services anytime soon. But it’s making progress. The government has just finished installing a 9-kilometer pipeline connecting the principal town of Mahmudiyah to a water treatment plant in Al Rasheed that will provide 25% of the district’s water. This was a joint project: the US provided the pipe, and the Iraqis laid it. On power, and water, and sanitation, we are helping the Iraqis develop long-term development plans to address shortages and advising on them on shorter-term, interim solutions, e.g., using smaller diesel- or solar-powered water treatment units. We’ve also brokered agreements with government officials and local sheiks to facilitate the cleaning and rehabilitation of canals for use in agriculture.
Yusifiyah Number 1 Pump Station on Tigris
We’re proud of a project to revive the poultry sector, a critical element of the region’s economy. This is a perfect example of the “day-to-day” projects that don’t make headlines, but make real economic progress in the country. When fully launched, this project should generate thousands of jobs. And it has brought together different tribal and religious factions in a way that only a successful business venture can. Under Saddam, Mahmudiyah district was a big poultry producer, but it was a command-economy style of production. We set about fostering a private, market-based poultry industry. With the Iraqis, we created a poultry association and gave it a jump start. We imported 90,000 eggs that hatched into chicks, rehabilitated 20 poultry houses, used high-protein feed, and sent ePRT experts to work with the farmers to raise the chickens under the right conditions.Vaccination of day-old chicks
The results have been positive and our support has been limited to providing technical support and advice. The plan is to expand to at least 100 poultry houses and to integrate the industry with a parent farm, hatcheries, a feed mill, and a processing plant. We’re working with the association to find credit and investment and to benefit from agricultural extension services to continue its growth.
Broilers Nearly Ready for Sale
We’ve provided loans and grants to small service businesses and factories in the area and helped to form business associations to foster economic activity. We’ve supported job training programs, particularly those focused on assisting women. Several markets in the district, some of which had been closed for years, are thriving again.
Evening shoppers in the Mahmudiyah market
We’re also working to revive several medium-sized industries in the area, e.g., helping a clothing factory to win supply contracts that have allowed it to grow its work force. Even more exciting, we’ve worked with the National Metallic and Bicycle Factory (NMBC) and a U.S. Task Force to build a special wheelchair for Iraqi children under rigorous specifications. This project could eventually help up to 150,000 Iraqi kids. We’re helping with other contracts for a heavy-duty adult wheelchair (the “Rough Rider”) and skateboards.
Rough Rider Wheelchairs
This is only the beginning. There is so much more that can be done here to promote agriculture and economic activity. We are planning a business expo with the Mahmudiyah Business Council to showcase the district and attract Iraqi and foreign investors. Sure, there are plenty of frustrations and challenges, but this is an exciting time to be working with the Iraqis and watch them continue their amazing progress.
The Government get's out of the way
I guess Chris Cox is doing his job after all, better than the rest of our government. This move alone could add trillions to our liquidity as a nation:
SEC Clarification May Help Markets
Some economists are attributing much of the current financial crisis to something as mundane-seeming as accounting.
The Securities and Exchange Commission and the Financial Accounting Standards Board have just made an announcement that, dry as it sounds, may mean a great deal: "When an active market for a security does not exist, the use of management estimates that incorporate current market participant expectations of future cash flows, and include appropriate risk premiums, is acceptable."
The SEC is not telling holders of hard-hit mortgage-backed securities that they can willy-nilly slap any value on them they want.
What the SEC is saying is: You can take other factors into account when valuing them.
There is no market right now for the worthless mortgage-backed securities -- that's one of the reasons we're in this crisis. That means financial institutions that are holding them must value them well below their former value, sometimes near zero. That makes the institutions themselves worth much less.
Is it 1992 all over again?
There are a great deal of similarities between this election and the Clinton election in 1992. For those of you who remember in 1992 we had a fresh face or Washington outsider running against the old guard or establishment. People were ready for a change! What is remarkable to me is how similar the situation is between Clinton vs. Bush and Obama vs. McCain.
Of course McCain is part of the old guard Washington establishment and like Bush Sr. never really completely comfortable with the Conservatives in Congress. Both are war hero's with incredible resume's. Neither are great on the stump or in a formal speech but both have an incredible understanding of the world and how it really works.
The real focus is the remarkable similarities between Clinton and Obama in a number of areas:
ASSOCIATIONS:
Bill Clinton had his financial improprieties in the Whitewater land deal with Jim McDougal and that later had many indictments and almost lead to Clinton's own downfall. Barack Obama has his connections with Tony Rezko who is waiting sentencing right now for some illegal activities due to real estate. Most of Clinton's other improper relationships were sexual in nature but Obama's appear to be ideological. First we have the Rev. Wright who ran a very radical church that had associations with left wing groups and Louis Farrakhan. Why a Christian church would have anything to do with the Muslim Farrakhan is unusual to say the least. Then you have Obama's relationship to former Weatherman Underground head William Ayers who bombed the Pentagon and NY city Police Headquarters. These are unusual characters for a political up and comer to hang around with. At least Bill Clinton stopped hanging around with radicals after his College days.
TAX POLICY:
Bill Clinton and Barack Obama ran for President on a promise of cutting taxes for the so called middle class. Please recall that after a very short time in the White House Bill Clinton said "I have never worked so hard in my life" and no middle class tax cut was delivered. Of course that happened a few years later but there was a different political dynamic then. I suspect since Obama is telling us that he will cut taxes for 95% of us and yet only approximately 60% of us even pay federal taxes this will not come to pass. Not to be pessimistic but when the guy is running on raising the payroll tax that funds Social Security and Medicare that means a tax increase, sorry middle class.
WIVES:
This is a most interesting comparison. What is it about these Democrats and the women they choose to marry. Hillary Rodham seems like the "Goldwater Girl" she describes herself as in comparison to Michelle Obama. Though before Mrs. Clinton decided to become Senator Clinton or President Clinton #2 she had some radical and self promoting problems herself. There have been numerous books on Mrs. Clinton and her radical notions and to call her a marxist would not be flamboyant. Her years at Wellsley are littered with leftist connections and unlike her husband she did not seem to outgrow them until well into his second term. This was most likely due to the trouncing he took in the 1994 elections which was mainly her fault. Mrs. Obama's leftist leaning appears to come from the black pride movement. For example, her comment to a crowd during the primaries when she said "this is the first time in my adult life I am proud to be an American". This would have to mean she was not proud when we won the Cold War and freed millions of Eastern Europeons from tyranny. This would mean she was not proud of when black and white members of the military freed a tiny country called Kuwait from an unprovoked attack by Iraq. This would mean she was not proud when the 1980 American Hockey team beat the Soviets. This would mean she was not proud of the Firefighters and Police of New York ran into a building that was about to come down to save any person they could. Not unlike Mrs. Clinton post 1994 Mrs Obama is no where to be found these days.
EXPERIENCE:
Although Bill Clinton came into office with much more experience and a better understanding of Washington than Barack Obama the lack of understanding how the world works is what is most concerning. You get the impression we were loved in the world when we had Bill Clinton as President. That is mostly true in the capitals of Europe but were we respected and the answer would be a resounding NO. The answer to that is simple. We had embassies and battle ships bombed by Al Queda. Saddam Hussein frequently fired at our plains flying in his portion of the world which was against the law as imposed by the United Nations. The Chinese certainly did not respect us or our wishes for freedom and democracy. What will Barack Obama do? We truly do not know the answer and it does not appear he knows the answer either as he had not given any clear direction during his campaign of the last 17 months.
Typically you will get out of a President what we see during a campaign. George H.W. Bush and John McCain clearly think of the big picture of world affairs. Bill Clinton and Barack Obama will put forth an image of "he cares about me" but what voters really need to think about is where is he going to take America. If Bill Clinton really cared about us in 1998 he would have resigned and quite frankly Al Gore would have won the election in 2000. Clinton and Obama are patriots but to think they really care about the common citizen is off base. They should care about all citizens instead of focusing on one class or another. John McCain, agree with him or not, has a sense of what America is supposed to stand for and look like internally and externally and that is what we need during for the road ahead.
Of course McCain is part of the old guard Washington establishment and like Bush Sr. never really completely comfortable with the Conservatives in Congress. Both are war hero's with incredible resume's. Neither are great on the stump or in a formal speech but both have an incredible understanding of the world and how it really works.
The real focus is the remarkable similarities between Clinton and Obama in a number of areas:
ASSOCIATIONS:
Bill Clinton had his financial improprieties in the Whitewater land deal with Jim McDougal and that later had many indictments and almost lead to Clinton's own downfall. Barack Obama has his connections with Tony Rezko who is waiting sentencing right now for some illegal activities due to real estate. Most of Clinton's other improper relationships were sexual in nature but Obama's appear to be ideological. First we have the Rev. Wright who ran a very radical church that had associations with left wing groups and Louis Farrakhan. Why a Christian church would have anything to do with the Muslim Farrakhan is unusual to say the least. Then you have Obama's relationship to former Weatherman Underground head William Ayers who bombed the Pentagon and NY city Police Headquarters. These are unusual characters for a political up and comer to hang around with. At least Bill Clinton stopped hanging around with radicals after his College days.
TAX POLICY:
Bill Clinton and Barack Obama ran for President on a promise of cutting taxes for the so called middle class. Please recall that after a very short time in the White House Bill Clinton said "I have never worked so hard in my life" and no middle class tax cut was delivered. Of course that happened a few years later but there was a different political dynamic then. I suspect since Obama is telling us that he will cut taxes for 95% of us and yet only approximately 60% of us even pay federal taxes this will not come to pass. Not to be pessimistic but when the guy is running on raising the payroll tax that funds Social Security and Medicare that means a tax increase, sorry middle class.
WIVES:
This is a most interesting comparison. What is it about these Democrats and the women they choose to marry. Hillary Rodham seems like the "Goldwater Girl" she describes herself as in comparison to Michelle Obama. Though before Mrs. Clinton decided to become Senator Clinton or President Clinton #2 she had some radical and self promoting problems herself. There have been numerous books on Mrs. Clinton and her radical notions and to call her a marxist would not be flamboyant. Her years at Wellsley are littered with leftist connections and unlike her husband she did not seem to outgrow them until well into his second term. This was most likely due to the trouncing he took in the 1994 elections which was mainly her fault. Mrs. Obama's leftist leaning appears to come from the black pride movement. For example, her comment to a crowd during the primaries when she said "this is the first time in my adult life I am proud to be an American". This would have to mean she was not proud when we won the Cold War and freed millions of Eastern Europeons from tyranny. This would mean she was not proud of when black and white members of the military freed a tiny country called Kuwait from an unprovoked attack by Iraq. This would mean she was not proud when the 1980 American Hockey team beat the Soviets. This would mean she was not proud of the Firefighters and Police of New York ran into a building that was about to come down to save any person they could. Not unlike Mrs. Clinton post 1994 Mrs Obama is no where to be found these days.
EXPERIENCE:
Although Bill Clinton came into office with much more experience and a better understanding of Washington than Barack Obama the lack of understanding how the world works is what is most concerning. You get the impression we were loved in the world when we had Bill Clinton as President. That is mostly true in the capitals of Europe but were we respected and the answer would be a resounding NO. The answer to that is simple. We had embassies and battle ships bombed by Al Queda. Saddam Hussein frequently fired at our plains flying in his portion of the world which was against the law as imposed by the United Nations. The Chinese certainly did not respect us or our wishes for freedom and democracy. What will Barack Obama do? We truly do not know the answer and it does not appear he knows the answer either as he had not given any clear direction during his campaign of the last 17 months.
Typically you will get out of a President what we see during a campaign. George H.W. Bush and John McCain clearly think of the big picture of world affairs. Bill Clinton and Barack Obama will put forth an image of "he cares about me" but what voters really need to think about is where is he going to take America. If Bill Clinton really cared about us in 1998 he would have resigned and quite frankly Al Gore would have won the election in 2000. Clinton and Obama are patriots but to think they really care about the common citizen is off base. They should care about all citizens instead of focusing on one class or another. John McCain, agree with him or not, has a sense of what America is supposed to stand for and look like internally and externally and that is what we need during for the road ahead.
Saturday, September 27, 2008
Global "Warming"
Here is an interesting study that I am sure will not be reported by the major media"
Recent studies by the Hadley Climate Research Center (UK), the Japan Meteorological Agency, the National Oceanic and Atmospheric Administration, the University of East Anglia (UK) and the University of Alabama Huntsville show clearly that the rising trend of global average temperature stopped in 2000-2001. Further, NASA data shows that warming in the southern hemisphere has stopped, and that ocean temperatures also have stopped rising.
Oops! I guess it is all Bush's fault...
Thursday, September 25, 2008
Good Read On The S&L Crisis
SEPTEMBER 25, 2008
What We Learned From Resolution Trust
By L. WILLIAM SEIDMAN and DAVID C. COOKE
As individuals who were intimately involved in the resolution of this country's last financial crisis, we follow with great interest Treasury Secretary Henry Paulson's proposal to acquire distressed real-estate assets from financial institutions.
The current situation threatens our economy more than the savings and loan and banking crisis of the 1980s and early 1990s. The Treasury secretary should be congratulated for moving quickly and decisively.
We would like to offer some thoughts based on our experiences in starting up and operating the government-owned Resolution Trust Corporation, as well as a similar type of operation undertaken by the Federal Deposit Insurance Corporation for dealing with failed banks.
The RTC was charged with resolving nearly 750 failing savings and loan institutions holding $400 billion in assets, and the FDIC had an additional $200 billion from failed banks. Most of these assets were loans to homeowners, builders and developers. Many of the assets, especially construction and development loans, had no established market or "fair value."
The major difference between then and now is that the RTC was, with only a couple of exceptions, dealing with S&Ls closed by their chartering agency. This meant the RTC took over the assets after the institution failed, not before. So the RTC did not have to first negotiate a "fair value purchase price" with a troubled seller. Our experience with past U.S. bank and S&L assistance efforts, as well as those of other countries, leads us to believe that deciding what price to pay -- and which institution to "assist" by buying their assets -- will not be easy.
Guidelines should be established regarding which institutions will be assisted, and how the government will minimize losses, should "fair value" prices prove too high. One option is to not pay all cash upfront. Another method of protecting the taxpayer against overpayment would be for the government to have the right to recover some part of losses suffered on the later sale of assets. Other countries with asset-acquisition programs found themselves conflicted between paying too much to help the bank and trying to avoid losses eventually realized.
Clear guidelines for the management process should be established as promptly as possible for the real-estate loans and/or mortgage-backed securities acquired by Treasury. Like those owned by the RTC, all will require some level of active management.
Buying and managing home mortgages acquired by Treasury will be very challenging. Valuation will be heavily influenced by local real-estate markets and the actions available to the lenders. Restrictions on lender actions or sale prices should be avoided to help maximize recoveries and minimize taxpayers' losses. Restructuring loans often provides an attractive option that avoids foreclosure and keeps families in their homes. But it is important that the lender be allowed to pursue other options when determined to be in the best interest of the taxpayer.
The most difficult loans for the RTC to manage were loans to developers and builders. Our guess is such loans are a looming problem that has not yet been fully recognized. While it is not clear if the proposal currently addresses such loans, it should. Their treatment will impact the property values underlying loans acquired by Treasury.
The RTC started a number of sales initiatives. For the more difficult real-estate loans and properties, we started hiring contractors to manage and sell the assets. But aligning the interests of contractors with the RTC proved very difficult.
The RTC saw that the larger its inventory of distressed assets became, the more the overhang impeded the ability of the markets to determine value and function effectively. We concluded that the only way to stimulate markets as well as avoid conflicting mandates was to quickly move assets into private-sector ownership and expertise, by selling them in bulk in an open and competitive manner.
Here are the most important lessons we learned from our experiences in the late '80s and early '90s:
- Acquired assets require active management. Assets tend to lose value while in government hands, as the government seldom can duplicate a private owner's interest in enhancing value. The RTC employed over 10,000 people in the first year of operation.
- Holding large inventories of assets will lead to depressed prices. No one wants to buy when the market has a large overhang of assets just waiting to be dumped when prices improve.
- To get the market started, assets have to be sold at very low prices. Such sales will attract buyers, with a resulting increase in prices. At the same time, selling at low prices could trigger accusations that the agency is "depressing the market."
- Every government sale or purchase creates winners and losers. This results in intense political and economic pressures to influence the actions of the agency. The RTC's independent governance and operations protected against fraud and political influence.
The Treasury proposal will undoubtedly raise many conflicts similar to those seen by the RTC. In our experience, government ownership and management of assets rarely increases value. Moving assets openly, fairly and promptly to sound private-sector owners is the best way to minimize taxpayers' losses. If the RTC hadn't adopted this approach, it might still be around today.
Mr. Seidman is former FDIC and RTC chairman. Mr. Cooke is former deputy FDIC chairman and RTC executive director.
What We Learned From Resolution Trust
By L. WILLIAM SEIDMAN and DAVID C. COOKE
As individuals who were intimately involved in the resolution of this country's last financial crisis, we follow with great interest Treasury Secretary Henry Paulson's proposal to acquire distressed real-estate assets from financial institutions.
The current situation threatens our economy more than the savings and loan and banking crisis of the 1980s and early 1990s. The Treasury secretary should be congratulated for moving quickly and decisively.
We would like to offer some thoughts based on our experiences in starting up and operating the government-owned Resolution Trust Corporation, as well as a similar type of operation undertaken by the Federal Deposit Insurance Corporation for dealing with failed banks.
The RTC was charged with resolving nearly 750 failing savings and loan institutions holding $400 billion in assets, and the FDIC had an additional $200 billion from failed banks. Most of these assets were loans to homeowners, builders and developers. Many of the assets, especially construction and development loans, had no established market or "fair value."
The major difference between then and now is that the RTC was, with only a couple of exceptions, dealing with S&Ls closed by their chartering agency. This meant the RTC took over the assets after the institution failed, not before. So the RTC did not have to first negotiate a "fair value purchase price" with a troubled seller. Our experience with past U.S. bank and S&L assistance efforts, as well as those of other countries, leads us to believe that deciding what price to pay -- and which institution to "assist" by buying their assets -- will not be easy.
Guidelines should be established regarding which institutions will be assisted, and how the government will minimize losses, should "fair value" prices prove too high. One option is to not pay all cash upfront. Another method of protecting the taxpayer against overpayment would be for the government to have the right to recover some part of losses suffered on the later sale of assets. Other countries with asset-acquisition programs found themselves conflicted between paying too much to help the bank and trying to avoid losses eventually realized.
Clear guidelines for the management process should be established as promptly as possible for the real-estate loans and/or mortgage-backed securities acquired by Treasury. Like those owned by the RTC, all will require some level of active management.
Buying and managing home mortgages acquired by Treasury will be very challenging. Valuation will be heavily influenced by local real-estate markets and the actions available to the lenders. Restrictions on lender actions or sale prices should be avoided to help maximize recoveries and minimize taxpayers' losses. Restructuring loans often provides an attractive option that avoids foreclosure and keeps families in their homes. But it is important that the lender be allowed to pursue other options when determined to be in the best interest of the taxpayer.
The most difficult loans for the RTC to manage were loans to developers and builders. Our guess is such loans are a looming problem that has not yet been fully recognized. While it is not clear if the proposal currently addresses such loans, it should. Their treatment will impact the property values underlying loans acquired by Treasury.
The RTC started a number of sales initiatives. For the more difficult real-estate loans and properties, we started hiring contractors to manage and sell the assets. But aligning the interests of contractors with the RTC proved very difficult.
The RTC saw that the larger its inventory of distressed assets became, the more the overhang impeded the ability of the markets to determine value and function effectively. We concluded that the only way to stimulate markets as well as avoid conflicting mandates was to quickly move assets into private-sector ownership and expertise, by selling them in bulk in an open and competitive manner.
Here are the most important lessons we learned from our experiences in the late '80s and early '90s:
- Acquired assets require active management. Assets tend to lose value while in government hands, as the government seldom can duplicate a private owner's interest in enhancing value. The RTC employed over 10,000 people in the first year of operation.
- Holding large inventories of assets will lead to depressed prices. No one wants to buy when the market has a large overhang of assets just waiting to be dumped when prices improve.
- To get the market started, assets have to be sold at very low prices. Such sales will attract buyers, with a resulting increase in prices. At the same time, selling at low prices could trigger accusations that the agency is "depressing the market."
- Every government sale or purchase creates winners and losers. This results in intense political and economic pressures to influence the actions of the agency. The RTC's independent governance and operations protected against fraud and political influence.
The Treasury proposal will undoubtedly raise many conflicts similar to those seen by the RTC. In our experience, government ownership and management of assets rarely increases value. Moving assets openly, fairly and promptly to sound private-sector owners is the best way to minimize taxpayers' losses. If the RTC hadn't adopted this approach, it might still be around today.
Mr. Seidman is former FDIC and RTC chairman. Mr. Cooke is former deputy FDIC chairman and RTC executive director.
Tuesday, September 23, 2008
Perspective
Folks, let's keep the housing and economic news in perspective as the the data below indicates:
According to the Federal Reserve, U.S. household net worth fell by $2 trillion over the last year, from $58 trillion in the second quarter of 2007 to about $56 trillion in the second quarter of 2008 (see chart above). But compared to 2002, U.S. household net worth has increased by almost $17 trillion (from $39.2 trillion to $56 trillion), or by almost 43% in the last six years.
Saturday, September 20, 2008
Palin like Truman
This will irritate the elite but the comparison is apt. Madam Sarah is ready! She has a quality that is needed today and that is a strong presence. The arrogance of the left is amazing is talking about experience but as Bret Stephens of the Journal notes she brings as much to the table as many other great leaders have in the past.
The Truman comparison seems especially to rankle Mrs. Palin's critics, perhaps because in many respects it rings true. Take vetting. John McCain may have met Mrs. Palin only once before he offered her the job, but Franklin Roosevelt admitted "I hardly know Truman" in July 1944, the same month the "Senator from Pendergast" was put on the Democratic ticket.
Or take foreign policy experience. It's fair to say that Mrs. Palin has none, and the McCain campaign should drop the transparent pretense that Alaska's proximity to Russia, or her nominal responsibility for the state's National Guard, gives her some.
Then again, what did Truman know? "Truman had no experience in relations with Britain or Russia, no firsthand knowledge of Churchill or Stalin," writes Mr. McCullough. "He didn't know his own Secretary of State, more than to say hello. . . . Roosevelt, Truman would tell [daughter] Margaret privately, 'never did talk to me confidentially about the war, or about foreign affairs or what he had in mind for peace after the war.' He was unprepared, bewildered."And then there are the others:
Mr. Dallek is also a presidential historian, so he must have some acquaintance with the career of Calvin Coolidge. When Coolidge was named to Warren Harding's ticket in 1920, he had been governor of Massachusetts for less than two years. Aside from a largely powerless stint as lieutenant governor and other smaller legislative posts, his chief previous government experience was as mayor of Northampton, to which he was first elected in 1910 by a Wasilla-like margin of 1,597 to 1,409.
Another year-and-a-half governor to be nominated for the vice presidency: Teddy Roosevelt. It's true that TR, as a former assistant secretary of the Navy, had more foreign policy experience than Mrs. Palin, though one wonders what today we would make of a candidate whose proud boast was that he had killed an enemy soldier "like a jackrabbit."
Let's not forget what all of these leaders possess and that is a core of knowing what they want from government and more importantly what they do not. Mr. Obama is lacking in all of this or as he says quite often "you know or uh".
The Mortgage Mess
As someone who is celebrating (yeah right) his 20th anniversary in the mortgage business this year I would like to give a briefer on what I think has caused this problem. Like most problems we face in the good old USA when government get's involved in business with all of good intentions things go to the extremes. I certainly do not blame all of this on government but they are the impetus that started us down this slippery slope.
Back in the 1990's the government set goals for the banking system on investing in minority communities. With zero predjudice but just experience speaking these communities just do not educate them selves on strong credit and good financial management. This set the financial system in a quandry as they are highly regulated institutions they needed to find a way to meet the goals set for them.
With this was born the subprime industry. With full disclosure there has been for a number of years this industry for the credit challenged borrower but with substantial down payments. Unfortunately the targeted borrower did not have the down payment so we started with removing down payments little by little until we ended up with no down payment.
Then the next issue arose how do we qualify these borrowers at 100% loans. There was a simple answer we don't. We called these limited doc or no doc loans. Well as you can imagine subprime started taking over the world.
What were Fannie and Freddie to do? It was easy start competing. They started offering A- loans which cost a little more but they were taking borrowers in their portfolio that did not meet the guidelines of subprime. Many of you have heard the term GSE and what this means is that Fannie and Freddie are Government Sponsored Enterprises. This means they are private but at the whims of politicians demands.
For example, a number of years ago I was at a Fannie Mae symposium and the unmentioned individual from Fannie told the crowd of the very poor performance of manufactured homes. Regardless of that she told us that congress has told them to purchase more of these for their portfolio. Readers, manufactured homes are cars with the wheels removed. What happens to your car value after you purchase it - the value goes down. No difference here!
So as you can see the downward spiral was evident. So what are we to do now. Unfortunately we are in a quandry. The government must step in to save the sector of the economy that produces tw0-thirds of the economic growth of this country. The big question after this is will the government do the right thing. After we get through this mess and stabilization sets in we should privitize Fannie and Freddie and then break them up much like the AT&T breakup of the 1980's.
What we do not need to do is what many of the politicians of both parties are clamoring for is more regulation. There so called regulation is what started this in the beginning.
Back in the 1990's the government set goals for the banking system on investing in minority communities. With zero predjudice but just experience speaking these communities just do not educate them selves on strong credit and good financial management. This set the financial system in a quandry as they are highly regulated institutions they needed to find a way to meet the goals set for them.
With this was born the subprime industry. With full disclosure there has been for a number of years this industry for the credit challenged borrower but with substantial down payments. Unfortunately the targeted borrower did not have the down payment so we started with removing down payments little by little until we ended up with no down payment.
Then the next issue arose how do we qualify these borrowers at 100% loans. There was a simple answer we don't. We called these limited doc or no doc loans. Well as you can imagine subprime started taking over the world.
What were Fannie and Freddie to do? It was easy start competing. They started offering A- loans which cost a little more but they were taking borrowers in their portfolio that did not meet the guidelines of subprime. Many of you have heard the term GSE and what this means is that Fannie and Freddie are Government Sponsored Enterprises. This means they are private but at the whims of politicians demands.
For example, a number of years ago I was at a Fannie Mae symposium and the unmentioned individual from Fannie told the crowd of the very poor performance of manufactured homes. Regardless of that she told us that congress has told them to purchase more of these for their portfolio. Readers, manufactured homes are cars with the wheels removed. What happens to your car value after you purchase it - the value goes down. No difference here!
So as you can see the downward spiral was evident. So what are we to do now. Unfortunately we are in a quandry. The government must step in to save the sector of the economy that produces tw0-thirds of the economic growth of this country. The big question after this is will the government do the right thing. After we get through this mess and stabilization sets in we should privitize Fannie and Freddie and then break them up much like the AT&T breakup of the 1980's.
What we do not need to do is what many of the politicians of both parties are clamoring for is more regulation. There so called regulation is what started this in the beginning.
Tuesday, September 16, 2008
The so-called income inequality
SEPTEMBER 15, 2008
New Evidence on Taxes and Income
By ARTHUR B. LAFFER and STEPHEN MOORE
The new Census Bureau data on income and poverty reveal that many of the economic trends in this country are a lot more favorable than America's detractors seems to think. In 2007, overall real median family income increased to $50,233, up $600 from 2006. The real median income for intact families -- mother and father in the home -- rose to $78,000, an all-time high.
Although incomes fell sharply in the U.S. after the dot-com bubble burst in 2000 (and still haven't fully recovered), these latest statistics reflect a 25-year trend of upward economic mobility. More important, Barack Obama is wrong when he states on his campaign Web site that the economic policies started by Ronald Reagan have rewarded "wealth not work." Based on this false claim -- that the rich have benefited by economic growth while others have not -- he intends to raise tax rates on high-income individuals.
To be sure, there has been a massive amount of wealth created in America over the last 25 years. But tax rates were cut dramatically across the income spectrum, for rich and poor alike. The results?
When all sources of income are included -- wages, salaries, realized capital gains, dividends, business income and government benefits -- and taxes paid are deducted, households in the lowest income quintile saw a roughly 25% increase in their living standards from 1983 to 2005. (See chart nearby; the data is from the Congressional Budget Office's "Comprehensive Household Income.") This fact alone refutes the notion that the poor are getting poorer. They are not.
Looking at the last two business cycles (first year of recovery to first year of recovery), this low-income group experienced a 10% rise in their inflation-adjusted after-tax incomes from 1983 to 1992 and then another 11% rise from 1992 to 2002). Roughly speaking, the Reagan and Clinton presidencies were equally good for them. Income gains over the last 30 years have been systematically understated due to several factors. These include:
- Fall in people per household. The gains in household income undercount the actual gains per person, because the average number of people living in low-income households has been shrinking. On a per capita basis, the real income gain for low-income households was 44% from 1983 to 2005, about 22% from 1983 to 1992 and about 18% from 1992 to 2002. These are excellent numbers by any measure.
- Earned income tax credit effect. The Earned Income Tax Credit (EITC) is a government payment to low income people who work. It was instituted on a small scale in 1975. In 1986, 1990, 1993 and 2001, Congress expanded the program.
Over time the EITC has multiplied the number of poor households that fill out tax forms each year and are thus counted in government income statistics. That's because to be eligible to receive the refundable EITC, a tax return must be filed.
Official tax return data show that in 1983, 19% of returns had zero tax liability; that percentage has climbed steadily, reaching 33% in 2005. (The Tax Policy Center estimates that in 2008 nearly 40% of filers will have no income tax liability.) Thus, we are now statistically counting more poorer families today than we used to. This is a major reason that median and poor household income gains appear to be a lot smaller than they have been in reality.
- Income mobility. In the U.S., people who had low incomes in 1983 didn't necessarily have incomes as low a decade later. People in this country have long moved up over time, and this income mobility continues to be true. While some people do remain in the lowest income group, they are the exception.
One way to quantify income mobility is to examine how many people remain in the same tax bracket over time. We compared the returns of tax filers in the lowest tax rate bracket (zero) in 1987 with their returns in 1996. Only one third of the tax filers were still in the zero tax bracket, but 25% were now in the 10% bracket, 32% had moved up to the 15% bracket and 9% were in the 25%, 28%, 33% or 35% brackets. And that was following them for a decade, not a generation.
From 1996 to 2005, we have the income mobility data for income quintiles. Of those filers who were in the lowest 20% in 1996 and who also filed in 2005, 42.4% remained in the bottom 20%, 28.6% were in the next highest quintile, 13.9% were in the middle quintile, 9.9% were in the second highest quintile, and 5.3% were in the highest quintile.
What is also striking about the data is that the poor today are, in general, not the same people who were poor even a few years ago. For example, the new Census data find that only 3% of Americans are "chronically" poor, which the Census Bureau defines as being in poverty for three years or more. Many of the people in the bottom quintile of income earners in any one year are new entrants to the labor force or those who are leaving the labor force. Obviously, there is also a significant core of truly poor people in this group, but that core is drastically less than 100%.
The data also show downward mobility among the highest income earners. The top 1% in 1996 saw an average decline in their real, after-tax incomes by 52% in the next 10 years.
America is still an opportunity society where talent and hard work can (almost always) overcome one's position at birth or at any point in time. Perhaps the best piece of news in this regard is the reduction in gaps between earnings of men and women, and between blacks and whites over the last 25 years.
Census Bureau data of real income gains from 1980 to 2005 show the rise in incomes based on gender and race. White males have had the smallest gains in income (up 9%), while black females have had by far the largest increase in income (up 79%). White females were up 74% and black males were up 34%. Income gaps within groups are rising, but the gaps among groups are declining. People are being rewarded in today's economy based on what they know and what they can do, not on the basis of who their parents are or the color of their skin.
There are of course Americans who live in poverty, as there are very affluent Americans with $25 million yachts and $10 million homes who hold ostentatious $200,000 birthday parties. But the evidence is plain that all groups across the income distribution have made solid gains during the last generation.
Taking from the rich through much higher tax rates in order to help the poor and middle class makes no sense intellectually and has seldom worked in practice. Reducing rates, on the other hand, does increase the share of taxes paid by the highest income-earning group. For example, in 1981, when the highest tax rate on the rich was 70% and the top capital gains tax rate was close to 45%, the richest 1% of Americans paid 17% of total income taxes. In 2005, with a top income tax rate of 35% and capital gains at 15%, the richest 1% of Americans paid 39%.
We suspect that Mr. Obama will discover that when you put "tax fairness" ahead of economic progress, you produce neither.
Mr. Laffer is president of Laffer Associates. Mr. Moore is senior economics writer for The Wall Street Journal editorial board.
New Evidence on Taxes and Income
By ARTHUR B. LAFFER and STEPHEN MOORE
The new Census Bureau data on income and poverty reveal that many of the economic trends in this country are a lot more favorable than America's detractors seems to think. In 2007, overall real median family income increased to $50,233, up $600 from 2006. The real median income for intact families -- mother and father in the home -- rose to $78,000, an all-time high.
Although incomes fell sharply in the U.S. after the dot-com bubble burst in 2000 (and still haven't fully recovered), these latest statistics reflect a 25-year trend of upward economic mobility. More important, Barack Obama is wrong when he states on his campaign Web site that the economic policies started by Ronald Reagan have rewarded "wealth not work." Based on this false claim -- that the rich have benefited by economic growth while others have not -- he intends to raise tax rates on high-income individuals.
To be sure, there has been a massive amount of wealth created in America over the last 25 years. But tax rates were cut dramatically across the income spectrum, for rich and poor alike. The results?
When all sources of income are included -- wages, salaries, realized capital gains, dividends, business income and government benefits -- and taxes paid are deducted, households in the lowest income quintile saw a roughly 25% increase in their living standards from 1983 to 2005. (See chart nearby; the data is from the Congressional Budget Office's "Comprehensive Household Income.") This fact alone refutes the notion that the poor are getting poorer. They are not.
Looking at the last two business cycles (first year of recovery to first year of recovery), this low-income group experienced a 10% rise in their inflation-adjusted after-tax incomes from 1983 to 1992 and then another 11% rise from 1992 to 2002). Roughly speaking, the Reagan and Clinton presidencies were equally good for them. Income gains over the last 30 years have been systematically understated due to several factors. These include:
- Fall in people per household. The gains in household income undercount the actual gains per person, because the average number of people living in low-income households has been shrinking. On a per capita basis, the real income gain for low-income households was 44% from 1983 to 2005, about 22% from 1983 to 1992 and about 18% from 1992 to 2002. These are excellent numbers by any measure.
- Earned income tax credit effect. The Earned Income Tax Credit (EITC) is a government payment to low income people who work. It was instituted on a small scale in 1975. In 1986, 1990, 1993 and 2001, Congress expanded the program.
Over time the EITC has multiplied the number of poor households that fill out tax forms each year and are thus counted in government income statistics. That's because to be eligible to receive the refundable EITC, a tax return must be filed.
Official tax return data show that in 1983, 19% of returns had zero tax liability; that percentage has climbed steadily, reaching 33% in 2005. (The Tax Policy Center estimates that in 2008 nearly 40% of filers will have no income tax liability.) Thus, we are now statistically counting more poorer families today than we used to. This is a major reason that median and poor household income gains appear to be a lot smaller than they have been in reality.
- Income mobility. In the U.S., people who had low incomes in 1983 didn't necessarily have incomes as low a decade later. People in this country have long moved up over time, and this income mobility continues to be true. While some people do remain in the lowest income group, they are the exception.
One way to quantify income mobility is to examine how many people remain in the same tax bracket over time. We compared the returns of tax filers in the lowest tax rate bracket (zero) in 1987 with their returns in 1996. Only one third of the tax filers were still in the zero tax bracket, but 25% were now in the 10% bracket, 32% had moved up to the 15% bracket and 9% were in the 25%, 28%, 33% or 35% brackets. And that was following them for a decade, not a generation.
From 1996 to 2005, we have the income mobility data for income quintiles. Of those filers who were in the lowest 20% in 1996 and who also filed in 2005, 42.4% remained in the bottom 20%, 28.6% were in the next highest quintile, 13.9% were in the middle quintile, 9.9% were in the second highest quintile, and 5.3% were in the highest quintile.
What is also striking about the data is that the poor today are, in general, not the same people who were poor even a few years ago. For example, the new Census data find that only 3% of Americans are "chronically" poor, which the Census Bureau defines as being in poverty for three years or more. Many of the people in the bottom quintile of income earners in any one year are new entrants to the labor force or those who are leaving the labor force. Obviously, there is also a significant core of truly poor people in this group, but that core is drastically less than 100%.
The data also show downward mobility among the highest income earners. The top 1% in 1996 saw an average decline in their real, after-tax incomes by 52% in the next 10 years.
America is still an opportunity society where talent and hard work can (almost always) overcome one's position at birth or at any point in time. Perhaps the best piece of news in this regard is the reduction in gaps between earnings of men and women, and between blacks and whites over the last 25 years.
Census Bureau data of real income gains from 1980 to 2005 show the rise in incomes based on gender and race. White males have had the smallest gains in income (up 9%), while black females have had by far the largest increase in income (up 79%). White females were up 74% and black males were up 34%. Income gaps within groups are rising, but the gaps among groups are declining. People are being rewarded in today's economy based on what they know and what they can do, not on the basis of who their parents are or the color of their skin.
There are of course Americans who live in poverty, as there are very affluent Americans with $25 million yachts and $10 million homes who hold ostentatious $200,000 birthday parties. But the evidence is plain that all groups across the income distribution have made solid gains during the last generation.
Taking from the rich through much higher tax rates in order to help the poor and middle class makes no sense intellectually and has seldom worked in practice. Reducing rates, on the other hand, does increase the share of taxes paid by the highest income-earning group. For example, in 1981, when the highest tax rate on the rich was 70% and the top capital gains tax rate was close to 45%, the richest 1% of Americans paid 17% of total income taxes. In 2005, with a top income tax rate of 35% and capital gains at 15%, the richest 1% of Americans paid 39%.
We suspect that Mr. Obama will discover that when you put "tax fairness" ahead of economic progress, you produce neither.
Mr. Laffer is president of Laffer Associates. Mr. Moore is senior economics writer for The Wall Street Journal editorial board.
The lie-ing about the lies
The new media/Obama obsession is the McCain's campaign's so called lie about the bill Obama supported on teaching Kindergarteners about sex ed. This is an excerpt from the bill:
Each class or course in comprehensive sex education offered in any of grades K through 12 shall include instruction on the prevention of sexually transmitted infections, including the prevention, transmission and spread of HIV AIDS. Nothing in this Section prohibits instruction in sanitation, hygiene or traditional courses in biology.
Sunday, September 14, 2008
Is Ken Lewis Over Confident?
In my humble opinion this is crazy. Bank of America took out MBNA and recently Countrywide and now Merrill. Too much too soon!
Merrill and BofA begin acquisition talks
By Francesco Guerrera in London
Merrill Lynch is in talks to be acquired by Bank of America in a sign that the crisis gripping Lehman Brothers is forcing rival investment banks to seek partners to avoid suffering the same fate.
People close to the situation said Bank of America had entered discussions with Merrill after pulling out the bidding for Lehman in a dramatic turn, partly prompted by the US government’s refusal to supply financial help for a Lehman takeover.
Bank of America and Merrill Lynch declined to comment but people close to the situation said no final price had been set, however the two sides were discussing a takeover at a substantial premium to Merrill’s closing price of $17.05 per share on Friday. One person said the price could be as high as $30 per share, valuing Merrill, whose shares have fallen nearly 70 per cent this year, at more than $45bn.
BofA’s chief executive Ken Lewis has long coveted Merrill in the belief that a merger the lender’s commercial banking operations and Merrill’s retail brokerage arm would be a formidable combination in the US financial services industry.
Bankers said that BoFa’s move could flush out other bidders for Merrill and added that the decision by John Thain, Merrill’s chief executive, to put the firm up for sale could put pressure on other investment banks such as Morgan Stanley and Goldman Sachs to also hit the takeover trail.
Copyright The Financial Times Limited 2008
Merrill and BofA begin acquisition talks
By Francesco Guerrera in London
Merrill Lynch is in talks to be acquired by Bank of America in a sign that the crisis gripping Lehman Brothers is forcing rival investment banks to seek partners to avoid suffering the same fate.
People close to the situation said Bank of America had entered discussions with Merrill after pulling out the bidding for Lehman in a dramatic turn, partly prompted by the US government’s refusal to supply financial help for a Lehman takeover.
Bank of America and Merrill Lynch declined to comment but people close to the situation said no final price had been set, however the two sides were discussing a takeover at a substantial premium to Merrill’s closing price of $17.05 per share on Friday. One person said the price could be as high as $30 per share, valuing Merrill, whose shares have fallen nearly 70 per cent this year, at more than $45bn.
BofA’s chief executive Ken Lewis has long coveted Merrill in the belief that a merger the lender’s commercial banking operations and Merrill’s retail brokerage arm would be a formidable combination in the US financial services industry.
Bankers said that BoFa’s move could flush out other bidders for Merrill and added that the decision by John Thain, Merrill’s chief executive, to put the firm up for sale could put pressure on other investment banks such as Morgan Stanley and Goldman Sachs to also hit the takeover trail.
Copyright The Financial Times Limited 2008
Charlie Gibson shows his bias
Here is an example of the bias Mr. Gibson shows towards Obama:
Obama interview:
How does it feel to break a glass ceiling?
How does it feel to “win”?How does your family feel about your “winning” breaking a glass ceiling?
Who will be your VP?
Should you choose Hillary Clinton as VP?Will you accept public finance?
What issues is your campaign about?Will you visit Iraq?
Will you debate McCain at a town hall?What did you think of your competitor’s [Clinton] speech?
Palin interview:
Do you have enough qualifications for the job you’re seeking?
Specifically have you visited foreign countries and met foreign leaders?
Aren’t you conceited to be seeking this high level job?
Questions about foreign policy-territorial integrity of Georgia-allowing Georgia and Ukraine to be members of NATO-NATO treaty-Iranian nuclear threat-what to do if Israel attacks Iran-Al Qaeda motivations-the Bush Doctrine-attacking terrorists harbored by Pakistan Is America fighting a holy war?
Obama interview:
How does it feel to break a glass ceiling?
How does it feel to “win”?How does your family feel about your “winning” breaking a glass ceiling?
Who will be your VP?
Should you choose Hillary Clinton as VP?Will you accept public finance?
What issues is your campaign about?Will you visit Iraq?
Will you debate McCain at a town hall?What did you think of your competitor’s [Clinton] speech?
Palin interview:
Do you have enough qualifications for the job you’re seeking?
Specifically have you visited foreign countries and met foreign leaders?
Aren’t you conceited to be seeking this high level job?
Questions about foreign policy-territorial integrity of Georgia-allowing Georgia and Ukraine to be members of NATO-NATO treaty-Iranian nuclear threat-what to do if Israel attacks Iran-Al Qaeda motivations-the Bush Doctrine-attacking terrorists harbored by Pakistan Is America fighting a holy war?
Political Independents...
Here is some good news on a recent poll but unfortunately independents swing with the latest wind.
In the wake of Sarah Palin, John McCain has opened up a 15-point lead among independents, according to a new Gallup Poll — and Barack Obama has a real problem.Since the GOP convention and his selection of the Alaska governor as his running mate, McCain has changed a months-long tie among independents into a 52 to 37 percent advantage. Support for McCain among self-described "conservative Democrats" has jumped 10 points, to 25 percent, signaling the shift among swing voters to McCain. The candidate’s surge tracks the script the campaign had written for the party convention. Joe Lieberman’s sleepy but substantively centrist speech was the preamble to McCain reframing the Republican Party around national security, fiscal conservatism and corruption reform. The result: he elevation of the independent maverick.
In the wake of Sarah Palin, John McCain has opened up a 15-point lead among independents, according to a new Gallup Poll — and Barack Obama has a real problem.Since the GOP convention and his selection of the Alaska governor as his running mate, McCain has changed a months-long tie among independents into a 52 to 37 percent advantage. Support for McCain among self-described "conservative Democrats" has jumped 10 points, to 25 percent, signaling the shift among swing voters to McCain. The candidate’s surge tracks the script the campaign had written for the party convention. Joe Lieberman’s sleepy but substantively centrist speech was the preamble to McCain reframing the Republican Party around national security, fiscal conservatism and corruption reform. The result: he elevation of the independent maverick.
Saturday, September 13, 2008
The new "Governator"
Running AlaskaSeptember 10, 2008;
One rap on Sarah Palin's qualifications to be Vice President is that she governs one of our least populated states, with a budget of "only" $12 billion and 16,000 full-time state employees. On the other hand, it turns out that the Governor's office in Alaska is one of the country's most powerful.
For more than two decades Thad Beyle, a political scientist at the University of North Carolina, has maintained an index of "institutional powers" in state offices. He rates governorships on potential length of service, budgetary and appointment authority, veto power and other factors. Mr. Beyle's findings for 2008 rate Alaska at 4.1 on a scale of 5. The national average is 3.5.
Only four other states -- Maryland, New Jersey, New York and West Virginia -- concentrate as much power in the Governor's office as Alaska does, and only one state (Massachusetts) concentrates more. California may be the nation's most populous state, but its Governor rates as below-average (3.2) in executive authority. This may account in part for Arnold Schwarzenegger's poor legislative track record. The lowest rating goes to Vermont (2.5), where the Governor (remember Howard Dean) is a figurehead compared to Mrs. Palin.
In Alaska, the Governor has line-item veto power over the budget and can only be overridden by a three-quarters majority of the Legislature. In 1992, the year Arkansas Governor Bill Clinton was elected President, his state budget was $2 billion and among the smallest in the country. Compared to that, Sarah Palin is an executive giant.
One rap on Sarah Palin's qualifications to be Vice President is that she governs one of our least populated states, with a budget of "only" $12 billion and 16,000 full-time state employees. On the other hand, it turns out that the Governor's office in Alaska is one of the country's most powerful.
For more than two decades Thad Beyle, a political scientist at the University of North Carolina, has maintained an index of "institutional powers" in state offices. He rates governorships on potential length of service, budgetary and appointment authority, veto power and other factors. Mr. Beyle's findings for 2008 rate Alaska at 4.1 on a scale of 5. The national average is 3.5.
Only four other states -- Maryland, New Jersey, New York and West Virginia -- concentrate as much power in the Governor's office as Alaska does, and only one state (Massachusetts) concentrates more. California may be the nation's most populous state, but its Governor rates as below-average (3.2) in executive authority. This may account in part for Arnold Schwarzenegger's poor legislative track record. The lowest rating goes to Vermont (2.5), where the Governor (remember Howard Dean) is a figurehead compared to Mrs. Palin.
In Alaska, the Governor has line-item veto power over the budget and can only be overridden by a three-quarters majority of the Legislature. In 1992, the year Arkansas Governor Bill Clinton was elected President, his state budget was $2 billion and among the smallest in the country. Compared to that, Sarah Palin is an executive giant.
This explains Obama's big crowd in Germany
Hallucinogenic chocolates doom Berlin sweet shop
Fri Sep 12, 2008 11:19am EDT
BERLIN (Reuters) - Police closed down a Berlin sweet shop after discovering the owner was selling chocolates and lollipops laced with hallucinogenic mushrooms and marijuana.
The 23-year old owner of the shop in the trendy east Berlin district of Prenzlauer Berg, an area known for its vibrant night life, was taken into custody on suspicion of drug-dealing.
"In the shop we found 120 pieces of magic mushroom chocolate and countless cannabis lollipops," said police, who confiscated around 70 sachets containing various drugs, about 20 marijuana joints, a range of pills and some jars of drug-laced honey.
Police said one customer, who appeared intoxicated, was arrested after trying to buy a bag of hallucinogenic mushrooms from an officer in the shop.
Fri Sep 12, 2008 11:19am EDT
BERLIN (Reuters) - Police closed down a Berlin sweet shop after discovering the owner was selling chocolates and lollipops laced with hallucinogenic mushrooms and marijuana.
The 23-year old owner of the shop in the trendy east Berlin district of Prenzlauer Berg, an area known for its vibrant night life, was taken into custody on suspicion of drug-dealing.
"In the shop we found 120 pieces of magic mushroom chocolate and countless cannabis lollipops," said police, who confiscated around 70 sachets containing various drugs, about 20 marijuana joints, a range of pills and some jars of drug-laced honey.
Police said one customer, who appeared intoxicated, was arrested after trying to buy a bag of hallucinogenic mushrooms from an officer in the shop.
The "Dummy" Bush gets it right again
How George W Bush stared down his generals in Iraq
Bob Woodward September 12, 2008
George W Bush trusted his generals in the early years of the Iraq War. But in 2006, he smelled failure with their main goals of Arabisation and troop withdrawals, and set in train an eventual escalation, bypassing the usual chain of command. So far, the US President appears to have been right. Bob Woodward reveals how the surge came about and why it has been succeeding, as Bush faces his last months in office
HALFWAY through the sixth year of his US presidency and more than three years into the Iraq War, George W. Bush stood on a veranda of the American embassy compound in Baghdad. He had flown through the night for a surprise visit to the new Iraqi Prime Minister. It was June 13, 2006. With so much at stake in Iraq, where success or failure had become the core of his legacy, Bush had been anxious to meet the man he had, in many ways, been waiting for since the invasion. It was now evening. A hazy sunset had descended over the sweltering, violent capital. The President stepped aside for a private conversation with US Army General George W. Casey Jr, the 57-year-old commander of the 150,000 U.S. forces in the country. A 5-foot-8 (173cm), four-star general with wire-rim glasses, closely cropped graying hair and a soft voice, Casey had been the commander in Iraq for two years. As American military units rotated in and out, rarely serving more than a year, Casey had remained the one constant, seeing it all, trying to understand - and end - this maddening war in this maddening land. Recently, there had been some positive news in Iraq. A week earlier, US forces had killed Abu Musab al-Zarqawi, the man Osama bin Laden had declared the “Prince of Al-Qa'ida in Iraq” and the terrorist organisation's in-country operational commander. And the previous month, after three elections and months of delay, Nouri al-Maliki finally had taken office as the country's first permanent Prime Minister. Now, in the warm Baghdad dusk, the President and the general lit thin cigars. “We have to win,” Bush insisted, repeating his public and private mantra. Casey had heard the President's line dozens of times. “I'm with you,” he replied. “I understand that. But to win, we have to draw down. We have to bring our force levels down to ones that are sustainable both for them and for us.” Casey felt that the Iraqis, a proud people and resistant to the Western occupation, needed to take over. The large, visible US force was ultimately a sign of disrespect. Worse, the prolonged occupation was making the Iraqis dependent. Each time additional US troops arrived, they soon seemed indispensable. The Iraqis needed to take back their country and their self-respect, so central to Arab culture. They needed to fight their own war and run their own government; they were doing neither. Casey studied Bush's face, now wrinkled and showing its 59 years, the right eye slightly more closed than the left under graying, full eyebrows. The general had pushed for a drawdown for two years. And while the President had always approved the strategy, he no longer seemed to buy Casey's argument. “I know I've got work to do to convince you of that,” the general said, “but I firmly believe that.” Bush looked sceptical. “I need to do a better job explaining to you” why winning means getting out, Casey said. “You do,” Bush replied. Casey had long concluded that one big problem with the war was the President himself. He later told a colleague in private that he had the impression that Bush reflected the “radical wing of the Republican Party that kept saying, ‘Kill the bastards! Kill the bastards! And you'll succeed.’” Since the beginning, the President had viewed the war in conventional terms, repeatedly asking how many of the various enemies had been captured or killed. The real battle, Casey believed, was to prepare the Iraqis to protect and govern themselves.
This is an edited extract from The War Within: A Secret White House History 2006-2008, by Bob Woodward, published by Simon & Schuster,price to come. Read the full extract in The Weekend Australian tomorrow. (Petraeus, officially commanding general, Multi-National Force - Iraq, later this month assumes a promotion as commander of the US Central Command, which includes the Middle East and Central Asia.)
Bob Woodward September 12, 2008
George W Bush trusted his generals in the early years of the Iraq War. But in 2006, he smelled failure with their main goals of Arabisation and troop withdrawals, and set in train an eventual escalation, bypassing the usual chain of command. So far, the US President appears to have been right. Bob Woodward reveals how the surge came about and why it has been succeeding, as Bush faces his last months in office
HALFWAY through the sixth year of his US presidency and more than three years into the Iraq War, George W. Bush stood on a veranda of the American embassy compound in Baghdad. He had flown through the night for a surprise visit to the new Iraqi Prime Minister. It was June 13, 2006. With so much at stake in Iraq, where success or failure had become the core of his legacy, Bush had been anxious to meet the man he had, in many ways, been waiting for since the invasion. It was now evening. A hazy sunset had descended over the sweltering, violent capital. The President stepped aside for a private conversation with US Army General George W. Casey Jr, the 57-year-old commander of the 150,000 U.S. forces in the country. A 5-foot-8 (173cm), four-star general with wire-rim glasses, closely cropped graying hair and a soft voice, Casey had been the commander in Iraq for two years. As American military units rotated in and out, rarely serving more than a year, Casey had remained the one constant, seeing it all, trying to understand - and end - this maddening war in this maddening land. Recently, there had been some positive news in Iraq. A week earlier, US forces had killed Abu Musab al-Zarqawi, the man Osama bin Laden had declared the “Prince of Al-Qa'ida in Iraq” and the terrorist organisation's in-country operational commander. And the previous month, after three elections and months of delay, Nouri al-Maliki finally had taken office as the country's first permanent Prime Minister. Now, in the warm Baghdad dusk, the President and the general lit thin cigars. “We have to win,” Bush insisted, repeating his public and private mantra. Casey had heard the President's line dozens of times. “I'm with you,” he replied. “I understand that. But to win, we have to draw down. We have to bring our force levels down to ones that are sustainable both for them and for us.” Casey felt that the Iraqis, a proud people and resistant to the Western occupation, needed to take over. The large, visible US force was ultimately a sign of disrespect. Worse, the prolonged occupation was making the Iraqis dependent. Each time additional US troops arrived, they soon seemed indispensable. The Iraqis needed to take back their country and their self-respect, so central to Arab culture. They needed to fight their own war and run their own government; they were doing neither. Casey studied Bush's face, now wrinkled and showing its 59 years, the right eye slightly more closed than the left under graying, full eyebrows. The general had pushed for a drawdown for two years. And while the President had always approved the strategy, he no longer seemed to buy Casey's argument. “I know I've got work to do to convince you of that,” the general said, “but I firmly believe that.” Bush looked sceptical. “I need to do a better job explaining to you” why winning means getting out, Casey said. “You do,” Bush replied. Casey had long concluded that one big problem with the war was the President himself. He later told a colleague in private that he had the impression that Bush reflected the “radical wing of the Republican Party that kept saying, ‘Kill the bastards! Kill the bastards! And you'll succeed.’” Since the beginning, the President had viewed the war in conventional terms, repeatedly asking how many of the various enemies had been captured or killed. The real battle, Casey believed, was to prepare the Iraqis to protect and govern themselves.
This is an edited extract from The War Within: A Secret White House History 2006-2008, by Bob Woodward, published by Simon & Schuster,price to come. Read the full extract in The Weekend Australian tomorrow. (Petraeus, officially commanding general, Multi-National Force - Iraq, later this month assumes a promotion as commander of the US Central Command, which includes the Middle East and Central Asia.)
Gibson Interview
I encourage all readers to take a look at this interview on You Tube. I found this very interesting on a number of fronts. Gibson is very dismissive of this very accomplished public servent. I even caught him rolling his eyes in one of her responses.
On the other hand, there were some definate weaknesses in her responses in some areas. She new her terrain very well but there were some Washington questions that she still needs work on. She comes across as very learned so I am not concerned in the slightest about her ability to do the job.
One wish I would have is that if the media would have such a probing interview with Barack Obama. This is yet to happen and I am sure my lung capacity is not there to see it.
On the other hand, there were some definate weaknesses in her responses in some areas. She new her terrain very well but there were some Washington questions that she still needs work on. She comes across as very learned so I am not concerned in the slightest about her ability to do the job.
One wish I would have is that if the media would have such a probing interview with Barack Obama. This is yet to happen and I am sure my lung capacity is not there to see it.
Another Dem who like the government to the charity
Biden's Tax Returns Show Little Charitable GivingPaul Caron wonders if the release of Sen. Joe Biden's tax returns "might backfire because the returns show that the Bidens have been amazingly tight-fisted when it comes to their charitable giving. Despite income ranging from $210,432 - $321,379 over the ten-year period, the Bidens have given only $120 - $995 per year to charity, which amounts to 0.06% - 0.31% of their income.""This giving compares very unfavorably to John McCain, whose tax returns show that he gave 27.3% - 28.6% of his income to charity in 2006-2007. During the same period, the Obamas' tax returns show that they gave 5.8% - 6.1% of their income to charity."Independent Sector reports that 89% of American households contribute to charity, with an average contribution of $1,620 -- 3.1% of income.
Another Obama flub!
Oops, Obama ad mocks McCain's inability to send e-mail. Trouble is, he can't due to tortured fingers
As part of its effort to show the 72-year-old Republican Sen. John McCain as old and out of touch, the Democratic Party's hip campaign of Sen. Barack Obama, which frequently says it honors the former POW's military service to his country, Friday released a new ad.
As noted Friday by our blogging colleagues over at the Technology blog here, the ad says, among other things: "1982, John McCain goes to Washington. Things have changed in the last 26 years, but McCain hasn't.
"He admits he doesn't know how to use a computer, can't send an e-mail."
Friday, September 12, 2008
Is the Media Nuts?
We surely know the political side of the isle they are on for making a big deal about this:
GIBSON: Do you agree with the Bush doctrine?
PALIN: In what respect, Charlie?
GIBSON: The Bush -- well, what do you interpret it to be?
PALIN: His world view?
GIBSON: No, the Bush doctrine, annunciated September 2002, before the Iraq War.
PALIN: I believe that what President Bush has attempted to do is rid this world of Islamic extremism, terrorists who are hell-bent on destroying our nation. There have been blunders along the way, though. There have been mistakes made, and with new leadership, and that's the beauty of American elections, of course, and democracy, is with new leadership comes opportunity to do things better.
GIBSON: The Bush doctrine as I understand it is that we have the right of anticipatory self-defense, that we have the right to a preemptive strike against any country that we think is going to attack us. Do you agree with us?
PALIN: Charlie, if there is legitimate and enough intelligent and legitimate evidence that tells us that a strike is imminent against American people, we have every right to defend our country.Appears she gets it to me!
Charlie Gibson's Gaffe
By Charles KrauthammerSaturday, September 13, 2008; A17
"At times visibly nervous . . . Ms. Palin most visibly stumbled when she was asked by Mr. Gibson if she agreed with the Bush doctrine. Ms. Palin did not seem to know what he was talking about. Mr. Gibson, sounding like an impatient teacher, informed her that it meant the right of 'anticipatory self-defense.' "
-- New York Times, Sept. 12
Informed her? Rubbish.
The New York Times got it wrong. And Charlie Gibson got it wrong.
There is no single meaning of the Bush doctrine. In fact, there have been four distinct meanings, each one succeeding another over the eight years of this administration -- and the one Charlie Gibson cited is not the one in common usage today. It is utterly different.
He asked Palin, "Do you agree with the Bush doctrine?"
She responded, quite sensibly to a question that is ambiguous, "In what respect, Charlie?"
Sensing his "gotcha" moment, Gibson refused to tell her. After making her fish for the answer, Gibson grudgingly explained to the moose-hunting rube that the Bush doctrine "is that we have the right of anticipatory self-defense."
Wrong.
I know something about the subject because, as the Wikipedia entry on the Bush doctrine notes, I was the first to use the term. In the cover essay of the June 4, 2001, issue of the Weekly Standard entitled, "The Bush Doctrine: ABM, Kyoto, and the New American Unilateralism," I suggested that the Bush administration policies of unilaterally withdrawing from the ABM treaty and rejecting the Kyoto protocol, together with others, amounted to a radical change in foreign policy that should be called the Bush doctrine.
Then came 9/11, and that notion was immediately superseded by the advent of the war on terror. In his address to the joint session of Congress nine days after 9/11, President Bush declared: "Either you are with us or you are with the terrorists. From this day forward any nation that continues to harbor or support terrorism will be regarded by the United States as a hostile regime." This "with us or against us" policy regarding terror -- first deployed against Pakistan when Secretary of State Colin Powell gave President Musharraf that seven-point ultimatum to end support for the Taliban and support our attack on Afghanistan -- became the essence of the Bush doctrine.
Until Iraq. A year later, when the Iraq war was looming, Bush offered his major justification by enunciating a doctrine of preemptive war. This is the one Charlie Gibson thinks is the Bush doctrine.
It's not. It's the third in a series and was superseded by the fourth and current definition of the Bush doctrine, the most sweeping formulation of the Bush approach to foreign policy and the one that most clearly and distinctively defines the Bush years: the idea that the fundamental mission of American foreign policy is to spread democracy throughout the world. It was most dramatically enunciated in Bush's second inaugural address: "The survival of liberty in our land increasingly depends on the success of liberty in other lands. The best hope for peace in our world is the expansion of freedom in all the world."
This declaration of a sweeping, universal American freedom agenda was consciously meant to echo John Kennedy's pledge in his inaugural address that the United States "shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe, in order to assure the survival and the success of liberty." It draws also from the Truman doctrine of March 1947 and from Wilson's 14 points.
If I were in any public foreign policy debate today, and my adversary were to raise the Bush doctrine, both I and the audience would assume -- unless my interlocutor annotated the reference otherwise -- that he was speaking about the grandly proclaimed (and widely attacked) freedom agenda of the Bush administration.
Not the Gibson doctrine of preemption.
Not the "with us or against us" no-neutrality-is-permitted policy of the immediate post-9/11 days.
Not the unilateralism that characterized the pre-9/11 first year of the Bush administration.
Presidential doctrines are inherently malleable and difficult to define. The only fixed "doctrines" in American history are the Monroe and the Truman doctrines which come out of single presidential statements during administrations where there were few other contradictory or conflicting foreign policy crosscurrents.
Such is not the case with the Bush doctrine.
Yes, Sarah Palin didn't know what it is. But neither does Charlie Gibson. And at least she didn't pretend to know -- while he looked down his nose and over his glasses with weary disdain, sighing and "sounding like an impatient teacher," as the Times noted. In doing so, he captured perfectly the establishment snobbery and intellectual condescension that has characterized the chattering classes' reaction to the mother of five who presumes to play on their stage.
By Charles KrauthammerSaturday, September 13, 2008; A17
"At times visibly nervous . . . Ms. Palin most visibly stumbled when she was asked by Mr. Gibson if she agreed with the Bush doctrine. Ms. Palin did not seem to know what he was talking about. Mr. Gibson, sounding like an impatient teacher, informed her that it meant the right of 'anticipatory self-defense.' "
-- New York Times, Sept. 12
Informed her? Rubbish.
The New York Times got it wrong. And Charlie Gibson got it wrong.
There is no single meaning of the Bush doctrine. In fact, there have been four distinct meanings, each one succeeding another over the eight years of this administration -- and the one Charlie Gibson cited is not the one in common usage today. It is utterly different.
He asked Palin, "Do you agree with the Bush doctrine?"
She responded, quite sensibly to a question that is ambiguous, "In what respect, Charlie?"
Sensing his "gotcha" moment, Gibson refused to tell her. After making her fish for the answer, Gibson grudgingly explained to the moose-hunting rube that the Bush doctrine "is that we have the right of anticipatory self-defense."
Wrong.
I know something about the subject because, as the Wikipedia entry on the Bush doctrine notes, I was the first to use the term. In the cover essay of the June 4, 2001, issue of the Weekly Standard entitled, "The Bush Doctrine: ABM, Kyoto, and the New American Unilateralism," I suggested that the Bush administration policies of unilaterally withdrawing from the ABM treaty and rejecting the Kyoto protocol, together with others, amounted to a radical change in foreign policy that should be called the Bush doctrine.
Then came 9/11, and that notion was immediately superseded by the advent of the war on terror. In his address to the joint session of Congress nine days after 9/11, President Bush declared: "Either you are with us or you are with the terrorists. From this day forward any nation that continues to harbor or support terrorism will be regarded by the United States as a hostile regime." This "with us or against us" policy regarding terror -- first deployed against Pakistan when Secretary of State Colin Powell gave President Musharraf that seven-point ultimatum to end support for the Taliban and support our attack on Afghanistan -- became the essence of the Bush doctrine.
Until Iraq. A year later, when the Iraq war was looming, Bush offered his major justification by enunciating a doctrine of preemptive war. This is the one Charlie Gibson thinks is the Bush doctrine.
It's not. It's the third in a series and was superseded by the fourth and current definition of the Bush doctrine, the most sweeping formulation of the Bush approach to foreign policy and the one that most clearly and distinctively defines the Bush years: the idea that the fundamental mission of American foreign policy is to spread democracy throughout the world. It was most dramatically enunciated in Bush's second inaugural address: "The survival of liberty in our land increasingly depends on the success of liberty in other lands. The best hope for peace in our world is the expansion of freedom in all the world."
This declaration of a sweeping, universal American freedom agenda was consciously meant to echo John Kennedy's pledge in his inaugural address that the United States "shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe, in order to assure the survival and the success of liberty." It draws also from the Truman doctrine of March 1947 and from Wilson's 14 points.
If I were in any public foreign policy debate today, and my adversary were to raise the Bush doctrine, both I and the audience would assume -- unless my interlocutor annotated the reference otherwise -- that he was speaking about the grandly proclaimed (and widely attacked) freedom agenda of the Bush administration.
Not the Gibson doctrine of preemption.
Not the "with us or against us" no-neutrality-is-permitted policy of the immediate post-9/11 days.
Not the unilateralism that characterized the pre-9/11 first year of the Bush administration.
Presidential doctrines are inherently malleable and difficult to define. The only fixed "doctrines" in American history are the Monroe and the Truman doctrines which come out of single presidential statements during administrations where there were few other contradictory or conflicting foreign policy crosscurrents.
Such is not the case with the Bush doctrine.
Yes, Sarah Palin didn't know what it is. But neither does Charlie Gibson. And at least she didn't pretend to know -- while he looked down his nose and over his glasses with weary disdain, sighing and "sounding like an impatient teacher," as the Times noted. In doing so, he captured perfectly the establishment snobbery and intellectual condescension that has characterized the chattering classes' reaction to the mother of five who presumes to play on their stage.
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