Monday Reads

Good Morning!

SuperPacs are going to play a central role in this coming year’s elections. The Supreme Court has basically opened free speech to the point that political free speech will go to the highest, unaccountable bidder. Rick Santorum is the only current presidential contender without one.  Here’s some background from ABC.

Super PACs, or “independent-expenditure only committees,” as they are officially known, are a relatively new kind of political action committee (PAC) that can raise unlimited amounts of money for a candidate or cause from corporations, unions, individuals, etc. The rise of the super PAC started in the most recent midterm cycle, after the Supreme Court’s ruling in the Citizens United case lifted federal and state campaign spending regulations dating back to the 1970s.

Super PACs have since become ubiquitous. Seven of the eight leading GOP candidates have at least one that is raising money in their behalf; a couple of the candidates have more than one. Earlier this month, a group calling itself “Texas Aggies for Rick Perry” filed papers with the Federal Election Commission. The name refers to Perry’s alma mater, Texas A&M University, and the group is the second super PAC operating in Perry’s behalf, in addition to his “Make Us Great Again” PAC, which formed in July.

The candidates are prohibited from having any connection to the super PACs, meaning they can also distance themselves from any negative campaign ads against their opponents that are funded by the super PACs. The groups can also pay for polling, mailing materials, social media efforts and research, among other things.

There are already legal questions on Perry’s use of SuperPacs according to Politico.

The Perry campaign’s borrowing of three clips from a SuperPAC ad for use in a campaign video was a novel foray into the gray area of campaign finance law, and so I asked the experts on Rick Hasen’s excellent and disputatious election law listserv for their views on it. They were not unanimous on the question, but Perry is clearly treading in some uncharted legal waters.

“With virtually all fundraising limits and prohibitions hanging on the necessity of independence between the super PAC and the Perry campaign, using super PAC footage for a campaign ad pushes the concept of independence to new boundaries,” emailed Ken Gross, an election lawyer at Skadden Arps.

David Mason, vice president at the political data firm Aristotle International, wrote that “whatever is going on in terms of the Perry campaign using Super PAC footage, it is simply not addressed by the coordination regulation.”

“That is not to say there are no FECA implications to a candidate using Super PAC footage. If a campaign is given footage for no charge, the footage could be an in-kind contribution to the campaign. A campaign could pay for the footage (raw footage typically costs way less than the cost of finishing and broadcasting), or, in this case, according to the spokesman you quote, gotten it from a public source,” he wrote.

Since the GOP couldn’t force its agenda on the Supercommittee, it will try to change the rules according to The Hill. They are trying to change the configuration of the automatic cuts to favor defense and their spending priorities.

Supercommittee member Sen. Pat Toomey (R-Pa.) said Sunday that Republicans will seek to “change the configuration” of the automatic spending cuts triggered by the committee’s failure to present a deficit-reduction deal.

“I think it’s important that we change the configuration [of the cuts]. I think there’s a broad consensus that too much of the cuts are weighted on [our national defense],” Toomey said on ABC’s “This Week With Christiane Amanpour.”

Toomey said he is “terribly disappointed” the committee failed to reach a deal but called the automatic cuts built into the committee’s mandate a “silver lining.”

The failure of the supercommittee to reach an agreement last week triggered $1.2 trillion in automatic cuts set to hit the Defense department and other programs in 2013.

Due to FOIA requests and the perseverance of some in congress, we are beginning to see the kinds of loans the Fed gave to banks that have not been disclosed before. There were $13 billion dollars of such loans.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.

Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. While Fed officials say that almost all of the loans were repaid and there have been no losses, details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.

UN Secretary General Ban Ki Moon has called for “Zero tolerance’ for violence against women as the UN celebrated November 25th as the International Day for the Elimination of Violence against Women.

According to the UN, 70% of women experience violence in their lifetime, and one in five women will become a victim of rape or attempted rape in her lifetime. A number of global surveys have shown that half of all women murder victims are killed by current or former husbands or partners.

November 25 is designated as the International Day for the Elimination of Violence against Women and in South Africa kicks of 16 days of activism, which ends on Human Rights Day.

In a statement to mark the occasion, Ban said young men and boys must be encouraged to become advocates for the elimination of violence against women. “We need to promote healthy models of masculinity. Too many young men still grow up surrounded by outmoded male stereotypes,” he said. “By talking to friends and peers about violence against women and girls, and by taking action to end it, they can help break the ingrained behaviour of generations.”

The wife of a charismatic christian youth minister and dentist who was found to be guilty of horrific crimes involving pedophilia tells her tale and speculates that Dorothy Sandusky may be as in the dark as she was.  Her story is at the Daily Beast.

Just shy of seven years ago, my life and the lives of my two children were turned upside down. The man I had been married to for more than a decade had been arrested as a part of an FBI sting to bring down NAMBLA, the North American Man-Boy Love Association, an advocacy group for pedophiles that supports an “end to the extreme oppression of men and boys in mutually consensual relationships.” I was a well-educated, philanthropic, 39-year-old mother who, until recently, was living a charmed Dallas life, married to a well-liked dentist who had been living a lie for our entire relationship.

A former youth-ministry volunteer at a local church, an energetic volunteer at our kids’ elementary school, and a favorite at their Y-Guides outings, my ex-husband, Todd, turned out to be a criminal who brought tremendous harm, both physically and emotionally, to prepubescent boys. He was an “inner circle” member of NAMBLA—a member of its board of directors—wanted by the feds. Throughout our marriage, which ended in a confusing divorce shortly before the FBI swept in, I believed him when he said he was traveling to dental conventions—when in fact, he was attending pedophile conferences. He kept a secret mailbox at the local post office, where he received his pedophilia newsletters and other suspicious mail. We never found any proof of illegal Internet activities—his hard drive had been cleaned—except for a printed-out receipt for a porn video of young boys. Often, as I eventually learned, these predators are masters of deceit, creating a façade of the “ideal family” to protect their image, or perhaps convince themselves that they’re not a deviant to society, all the while acting on their sick desire to engage in sexual acts with kids.

OOh, baby, it’s a wild world.So, what’s on your reading and blogging list this morning?


EuroZone Woes

There’s been a number of interesting things coming out of Europe this weekend that will undoubtedly impact US Financial Markets and probably the economy since they are a significant trading partner as well as investor in US businesses.  The adoption of the Euro and the expansion of the trade zone area has generally been shown to be a huge boon to the European Economy.  It’s really hard for me to imagine the collapse of the Euro since it has been so successful that a variety of countries through out the world are in the process of adopting their own versions.  There have been a lot of people against the arrangement primarily because they’re still in nationalist mode and dislike the idea of any kind of cooperation that looks like ‘collectivism’.  The astounding economic results have been difficult to rebut however.

There are two items that generally are considered problematic for some countries that join a monetary union.  The first is the loss of independent monetary policy including the ability to debase your currency as a means to stimulating your economy.  The offset to that is that if you’re a country like Greece that has had incredible issues with inflation stemming from politicized monetary policy, you pick up credibility when you outsource that function to a shared central bank.  That’s especially the case when you share your central bank with the Germans who have been inflation wary since the Weimar Republic. The Japanese central bank and the German central bank are well known for controlling inflation over just about any other economic priority.  The second problem is the potential need for cross country fiscal policy.  That has never been much of an issue in the EU until now.  That is why there is talk of an IMF rescue of countries like Greece.  Also, there’s some talk of hurrying fiscal integration or giving some entity the ability to float “eurobonds” specifically for countries that are in trouble right now like Italy.  The problem right now is that many of the weaker EU countries were allowed to borrow substantially and with a credit crisis and banking troubles that led to recession, the bonds from those countries (sovereign debt) have no lost their value.

There are some that think the Eurozone will fall apart.  I find that hard to accept given the substantial boost that the zone has been to many economies in the form of trade and direct financial investment.  This benefit has gone to all countries and is called the “Rose Effect”. I’ve spent the last three years of my life studying all of this in great detail.  I am as vested in any one in the outcome. Here’s a few items that have been going on as we watch Eurozone brinkmanship play out. Reuters reports that Germany and France are forming a “Stability Pact” and hoping to get the European Central Bank leaders will act more like Bernanke’s Fed.

Echoing a Reuters report on Friday from Brussels, the Sunday newspaper said the French and German leaders were prepared to back a deal with other euro countries that might induce the ECB to intervene more forcefully to calm the euro debt crisis.

The newspaper report quoted German government sources as saying that the crisis fighting plan could possibly be announced by German Chancellor Angela Merkel and French President Nicolas Sarkozy in the coming week.

In an advance release before publication, Welt am Sonntag said that because it would take too long to change existing European Union treaties, euro zone countries should just agree among themselves on a new Stability Pact to enforce budget discipline – possibly implemented at the start of 2012.

It could be similar to the Schengen Agreement which applies to EU countries that choose to take part and enables their citizens to enjoy uninhibited cross border travel. Among the countries in the Stability Pact, there would be a treaty spelling out strict deficit rules and control rights for national budgets.

Reports from AFP show that the IMF may be planning a 600 billion Euro rescue plan for Italy. Italy is the world’s 8th largest economy.  It’s the 4th largest in Europe.  Needless to say, this is highly irregular.

The IMF could bail out Italy with up to 600 billion euros ($794 billion), an Italian newspaper reported on Sunday, as Prime Minister Mario Monti came under pressure to speed up anti-crisis measures.

The money would give Monti a window of 12 to 18 months to implement urgent budget cuts and growth-boosting reforms “by removing the necessity of having to refinance the debt,” La Stampa reported, citing IMF officials in Washington.

The IMF would guarantee rates of 4.0 percent or 5.0 percent on the loan — far better than the borrowing costs on commercial debt markets, where the rate on two-year and five-year Italian government bonds has risen above 7.0 percent.

The size of the loan would make it difficult for the IMF to use its current resources so different options are being explored, including possible joint action with the European Central Bank in which the IMF would be guarantor.

“This scenario is because resistance from Berlin to a greater role for the ECB in helping states in difficulty — starting with Italy — could be overcome if the funds are given out under strict IMF surveillance,” the report said.

The European Union and the ECB have sent auditors to check Italy’s public accounts this month and the IMF is set to send experts soon under a special surveillance mechanism agreed at the G20 summit in France earlier this month.

The WSJ reports that a number of countries are pressuring ECB for concessions.  The worry is that these same economies that have always had weaker economies and lax fiscal constraint will continue on that path.  (These countries include Portugal, Spain, Greece, Italy and Ireland which have been sarcastically  given the acronym PIIGS.)

While the ECB has so far said that it won’t beef up its limited bond buying, a growing number of governments are lobbying it to change its stance. A green light from Berlin for a bigger ECB role is seen by many euro-zone policy makers as a political necessity if the ECB is to act. Although the bank is politically independent, it has also paid close attention to the debate in Germany, where the government has so far rejected a bigger role for the central bank.

A new, binding fiscal regime would not be enough to justify the creation of collective euro-zone bonds, German officials say. But it might be enough to justify ECB action to stabilize bond markets that policy makers view as increasingly dysfunctional, some in Berlin say.

Other German officials remain skeptical about a greater ECB role—including Bundesbank President Jens Weidmann, who sits on the ECB’s governing council. Germany’s central bankers have been outvoted by the ECB majority before, however, including this August, when Mr. Weidmann opposed the decision to make limited purchases of Italian and Spanish bonds.

German Chancellor Angela Merkel said last week that she wants EU treaty changes to make the bloc’s fiscal rules legally enforceable by European authorities, in the same way that EU antitrust rules are.

European Council President is going to meet with Treasury Secretary Geithner on Monday at the US Treasury. Both Germany and Italy have had bond auction failures within the last week. This is causing the situation to look more dire. FT’s Wolfgang Munchau says the Eurozone has about 10 days before it collapses. His analysis borders on the sanguine.

Last week, the crisis reached a new qualitative stage. With the spectacular flop of the German bond auction and the alarming rise in short-term rates in Spain and Italy, the government bond market across the eurozone has ceased to function.

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/d9a299a8-1760-11e1-b00e-00144feabdc0.html#ixzz1exnj0HAB

The banking sector, too, is broken. Important parts of the eurozone economy are cut off from credit. The eurozone is now subject to a run by global investors, and a quiet bank run among its citizens.

This massive erosion of trust has also destroyed the main plank of the rescue strategy. The European Financial Stability Facility derives its firepower from the guarantees of its shareholders. As the crisis has spread to France, Belgium, the Netherlands and Austria, the EFSF itself is affected by the contagious spread of the disease. Unless something very drastic happens, the eurozone could break up very soon.

Technically, one can solve the problem even now, but the options are becoming more limited. The eurozone needs to take three decisions very shortly, with very little potential for the usual fudges.

All eyes and much money is on the European Central Bank right now. Watch the equity markets. They will probably represent the collective guess on the end of the world as we know it.


Well, isn’t this Awkward?

It seems NATO Air Strikes have killed about 28 Pakistani forces in Pakistan.  Isn’t that considered an act of war in most books? Either our air support technology isn’t what it is supposed to be or more than a few folks need better training. The press is saying that tensions are high between Pakistan and NATO right now.  I’d say that’s probably an understatement.

Pakistani officials said Saturday that NATO aircraft had killed at least 25 soldiers in strikes against two military posts at the northwestern border with Afghanistan, and the country’s supreme army commander called them unprovoked acts of aggression, in a new flash point between the United States and Pakistan.

The Pakistani government responded by ordering the C.I.A. to vacate the drone operations it runs from Shamsi Air Base, in northern Pakistan, within 15 days and by closing down the two main NATO supply routes into Afghanistan, including the one at Torkham. NATO forces receive roughly 40 percent of their supplies through that crossing, which runs through the Khyber Pass, and Pakistani officials gave no estimate for how long the routes might be closed.

In Washington, American officials were scrambling to assess what had happened and weigh the implications on a relationship that took a sharp turn for the worse after a United States military helicopter raid killed Osama bin Laden near Islamabad in May, and that has deteriorated since then.

“It seems quite extraordinary that we’d just nail these posts the way they say we did,” said one senior American official who was in close touch with American and NATO officials in Pakistan and Afghanistan early Saturday. “Whether they were going after people or whether there was some firing from the Afghan side of the border, then the Pakistan side, we just don’t know. It’s real murky right now. Clearly, something went very wrong.”

The American ambassador in Islamabad, Cameron Munter, called an emergency meeting and expressed regret over the Pakistani casualties. And Gen. John R. Allen, the commander of NATO-led forces in Afghanistan, offered condolences to families of the dead and promised an investigation. “This incident has my highest personal attention and my commitment to thoroughly investigate it to determine the facts,” he said in a statement.

According to The UK Guardian, NATO is claiming self-defense.

An attack by Nato aircraft on Pakistani troops that allegedly killed as many as 28 soldiers and looks set to further poison relations between the US and Pakistan was an act of self-defence, a senior western official has claimed.

According to the Kabul-based official, a joint US-Afghan force operating in the mountainous Afghan frontier province of Kunar was the first to come under attack in the early hours of Saturday morning, forcing them to return fire.

The high death toll from an incident between two supposed allies suggests Nato helicopters and jets strafed Pakistani positions with heavy weapons.

The deadliest friendly fire incident since the start of the decade-long war also prompted Pakistan to ban Nato supply trucks from crossing into Afghanistan and to issue an order demanding the US quit the remote Shamsi airbase, from which the US has operated some unmanned drone aircraft.

A spokesman for Nato’s International Security Assistance Force (ISAF) said it was “highly likely” that aircraft which had been called into the area to provide “close air support” to troops on the ground was responsible for causing casualties among the Pakistani soldiers.

For their part, a statement by the Pakistani military claimed that it was they who were attacked first, forcing them to respond to Nato’s “aggression with all available weapons”.

According to Pakistani officials the 40 or so soldiers stationed at the outposts were asleep at the time of the attack. Government officials said the two border posts that were attacked had recently been established to try to stop insurgents who use bases in Afghanistan to attack Pakistan from crossing the border and launching attacks.

We’ve gotten a reputation for collateral damage in the area. This certainly isn’t going to help. It will be interesting to see how this plays on the Sunday Talk shows.

Pakistan has cut of supplies as retaliation so far.

Pakistan is a vital land route for nearly half of NATO supplies shipped overland to its troops in Afghanistan, a NATO spokesman said. Land shipments account for about two thirds of the alliance’s cargo shipments into Afghanistan.

Hours after the raid, NATO supply trucks and fuel tankers bound for Afghanistan were stopped at Jamrud town in the Khyber tribal region near the city of Peshawar, officials said.

The border crossing at Chaman in southwestern Baluchistan province was also closed, Frontier Corps officials said.

A meeting of the cabinet’s defense committee convened by Gilani “decided to close with immediate effect NATO/ISAF logistics supply lines,” according to a statement issued by Gilani’s office.

The committee decided to ask the United States to vacate, within 15 days, the Shamsi Air Base, a remote installation in Baluchistan used by U.S. forces for drone strikes which has long been at the center of a dispute between Islamabad and Washington.

The last thing we need is major screw ups like this.  Bet Hillary’s on that 3 am phone call again.


Black Friday Reads

Welcome to the traditional start of the National Crass Consumerism Season!

It’s that time of year when every trip to a store is an overwhelming assault on all of your senses in an attempt to get you to buy stuff!  It was hard to avoid all the commercials yesterday, wasn’t it?  Robert Scheer has a great piece up on Truth Dig that puts this time of year in perspective.

On this Thanksgiving we have been cheated of the bounty of that harvest as the stakes have been pulled up on 50 million Americans who have lost or soon will lose their homes. The housing crisis haunts a majority of Americans, even those who own their homes outright but have lost their jobs and must now sell in a downward-swirling housing market.

Good public education on every level, from preschool through college, is now a matter of inherited privilege reserved for those who can pick and choose affluent neighborhood settings for their children’s schools. And the prospect of affording one of those settings is dim for most parents in a country where securing a good job is beyond the reach of so many highly motivated people.

How many folks from my generation are honestly sanguine about the economic future of their children and grandchildren? What I have heard constantly, and just this week from a former top investment banker addressing a college class I teach, is that our offspring probably will face a decade of lost opportunity. I thought back to my college days and how shocked any of us, even those from the most impoverished of circumstances, would have been to hear such a prediction.

As The New York Times editorialized this Thanksgiving, “One in three Americans—100 million people—is either poor or perilously close to it.”

There’s a movement afoot called Occupy Black Friday.

Occupy Black Friday, which is among the groups calling for people to spend locally rather than at chain stores, could not be reached for comment.

The anti-consumption spirit of the various scheduled Occupy events has a precedent in Buy Nothing Day, the yearly undertaking — always scheduled to fall on Black Friday — in which participants refrain from spending any money.

Buy Nothing Day was created some 20 years ago by advocates associated with the Vancouver magazine Adbusters, which also issued the original call for the movement that would become Occupy Wall Street. While it remains a red-letter date on the calendars of many social activists, its effects on retail sales have traditionally been less than earthshattering.

“They’re fragmentary, they’re ephemeral,” said Richard Hastings, a macro and consumer strategist at Global Hunter Securities, of Buy Nothing Day and similar campaigns that have attempted to build commercial headwinds on Black Friday. “To really be quite poetic about it, they’re evanescent.”

Hastings said that “the Occupy movement in the U.S. can only have some impact if it starts to do boycotts” — but added that he does not expect the anti-Black Friday forces to change many minds this year.

Here’s a great suggestion for celebrating the day after Thanksgiving from the Daily Show!  Prior to Abraham Lincoln making Thanksgiving a National Holiday, New York used to recognize Evacuation Day.  Massachusetts celebrates the day on March 17th which has been co-opted by Saint Patrick’s Day.  The days were set aside in the colony to celebrate the day when the British evacuated that colony after the Revolution. They celebrate the end of the rule of an occupying army.

Vodpod videos no longer available.

There’s another great thing that happened on November 24, 1859.  That’s the publication date of On the Origin of Species by Means of Natural Selection by Charles Darwin.  Darwin’s epic release of his work changed our view of biology, botany, and creation myths. Scientists now accept this theory as a basis to the development of every living species even though many radical religionists still try to replace it with creation myths in classrooms in many states. Louisiana dingbat Governor Bobby Banana Republic Jindal gave religious myth equal footing with science this year in a case that’s law that’s bound to head to the supreme court.  He signed a “Louisiana Science Education Act” that sneaks religion into science classes. Scopes Monkey Trial any one?

Darwin had formulated his theory of natural selection by 1844, but he was wary to reveal his thesis to the public because it so obviously contradicted the biblical account of creation. In 1858, with Darwin still remaining silent about his findings, the British naturalist Alfred Russel Wallace independently published a paper that essentially summarized his theory. Darwin and Wallace gave a joint lecture on evolution before the Linnean Society of London in July 1858, and Darwin prepared On the Origin of Species by Means of Natural Selection for publication.

Published on November 24, 1859, Origin of Species sold out immediately. Most scientists quickly embraced the theory that solved so many puzzles of biological science, but orthodox Christians condemned the work as heresy. Controversy over Darwin’s ideas deepened with the publication of The Descent of Man, and Selection in Relation to Sex (1871), in which he presented evidence of man’s evolution from apes.

By the time of Darwin’s death in 1882, his theory of evolution was generally accepted. In honor of his scientific work, he was buried in Westminster Abbey beside kings, queens, and other illustrious figures from British history. Subsequent developments in genetics and molecular biology led to modifications in accepted evolutionary theory, but Darwin’s ideas remain central to the field.

There is an astounding amount of evidence from the fields of genetics and molecular biology to now support Darwin’s basic ideas.  PBS maintains an Evolution Library that’s full of links to some of the most astounding new evidence that has made the theory even more developed and iron clad.  Here’s a great paper from the National Academy of Science on Science and Creationism.  This elucidates the difference between Darwin’s work and the modern theory of Evolution.

Contrary to popular opinion, neither the term nor the idea of biological evolution began with Charles Darwin and his foremost work, On the Origin of Species by Means of Natural Selection (1859). Many scholars from the ancient Greek philosophers on had inferred that similar species were descended from a common ancestor. The word “evolution” first appeared in the English language in 1647 in a nonbiological connection, and it became widely used in English for all sorts of progressions from simpler beginnings. The term Darwin most often used to refer to biological evolution was “descent with modification,” which remains a good brief definition of the process today.

Darwin proposed that evolution could be explained by the differential survival of organisms following their naturally occurring variation—a process he termed “natural selection.” According to this view, the offspring of organisms differ from one another and from their parents in ways that are heritable—that is, they can pass on the differences genetically to their own offspring. Furthermore, organisms in nature typically produce more offspring than can survive and reproduce given the constraints of food, space, and other environmental resources.

Darwin proposed that evolution could be explained by the differential survival of organisms following their naturally occurring variation—a process he termed “natural selection.” According to this view, the offspring of organisms differ from one another and from their parents in ways that are heritable—that is, they can pass on the differences genetically to their own offspring. Furthermore, organisms in nature typically produce more offspring than can survive and reproduce given the constraints of food, space, and other environmental resources. If a particular off-spring has traits that give it an advantage in a particular environment, that organism will be more likely to survive and pass on those traits. As differences accumulate over generations, populations of organisms diverge from their ancestors.

Darwin’s original hypothesis has undergone extensive modification and expansion, but the central concepts stand firm. Studies in genetics and molecular biology—fields unknown in Darwin’s time—have explained the occurrence of the hereditary variations that are essential to natural selection. Genetic variations result from changes, or mutations, in the nucleotide sequence of DNA, the molecule that genes are made from. Such changes in DNA now can be detected and described with great precision.

Today in 2002, President George W. Bush signed the Homeland Security Act and named Tom Ridge it’s first Secretary.  The first two secretaries–Ridge and Michael Chertoff–have written books.  There’s an overview of each at the link above. Here’s some info on Ridge and the creation of the DHS.

Although Ridge was an early proponent of the creation of DHS, the White House initially was not supportive. As Ridge notes, President Bush’s focus was on strengthening the power of the executive branch that he felt over the years “had been improperly ceded to Congress” (p. 126). Hence, the White House wanted a strong cabinet around it. The real impetus for the creation of DHS came from Congress, which was increasingly frustrated by the lack of oversight of the billions of dollars over which Ridge had influence (but no real power). After the White House refused to allow Ridge to testify before Congress about his homeland security priorities, and after the legacy INS sent two visas to dead 9/11 hijackers to attend flight training school in Florida, DHS became a political inevitability. As Ridge recounts, Congress wanted him “unmuzzle[d]” and the White House realized “[i]t would be better for the administration to be the architect of the new department rather than allowing Congress to take the lead” (pp. 127, 129).
Although the White House eventually supported the creation of DHS – and asked him to lead it – Ridge describes how his vision of homeland security and that of the administration differed. As Ridge observes, “the silly prolonged debate with the White House over the design of the new department’s seal was as absurd as it was revealing” (p. 71). The Bush administration wanted an eagle emblem to hold arrows in both talons as if to say the key to victory over terrorism was through aggression, forward-leaning military, and counterterrorism action. Ridge countered: “We thought differently. There was far more to defeating the enemy than military action” (p. 71). To his credit, Ridge discusses in detail what else his vision of homeland security entailed, which can be summed up as creating an environment of trust and credibility with the public. As he explains: “Only disclosure and transparency would generate the confidence and trust needed by our government as it waged its war domestically” (p. 72).

There’s a few international stories that you probably should follow. First, Egypt is experiencing a huge amount of violence right before elections are to be held.
There have been massive protests in Tahir square, arrests, and assaults on journalists by the police.

A capital city convulsed with violence just days before the first democratic elections in decades might not seem ideal. But some voters think the demonstrations will keep the transition from stalling.

Abdul Rahman Mansour, a graphic designer in the capital, says the people on Tahrir Square are making sure their rights are respected and the country moves ahead.

American University in Cairo professor Said Sadek agrees, saying the protests serve as a wake-up call for the ruling Supreme Council of the Armed Forces. “After the end of Mubarak rule SCAF has no legitimacy except obeying and meeting the demands of the revolution. This is revolutionary legitimacy. So they have to follow what is happening,” he said.

International condemnation of Syria’s dictator is turning into action. The Arab League has asked for harsher sanctions and a possible fly over zone with help from the UN if al-Assad does not stop his violence against peaceful protestors.

In a special meeting in Cairo, the Arab League called on Syria to agree by Friday to admit a mission of 500 civilian and military observers to monitor the human rights situation and oversee efforts to carry out a peace plan that Syria agreed to on Nov. 2.

The Arab League suspended Syria this month after it failed to comply with the plan, under which it had pledged to withdraw all military units from the streets, stop killing protesters and allow the monitors to enter the country.

The league said that if Syria refused to admit the monitors, it would meet again on Saturday to discuss sanctions that could include the suspension of all trade except for essential humanitarian goods, a ban on flights to Syria, a travel ban on Syrian officials, and the freezing of all transactions with the central bank and of all Arab economic projects under way in Syria.

If enacted, the new penalties would deal a stinging blow to an economy already suffering under sanctions from the European Union and the United States. Syria’s two most vital sectors, oil and tourism, which account for more than a third of the government’s revenues, have all but come to a halt.

While there was no official response from the leadership in Damascus, Syrian state television said that the government would reject the deal as an infringement on its sovereignty.


In other news from the Arab spring uprisings, Yeman’s president has resigned.
However, protestors have problems with the succession.

A U.S.-backed deal for Yemen’s authoritarian president to step down fell far short of the demands of protesters who fought regime supporters on the streets of Sanaa Thursday in clashes that left five dead.

The agreement ending President Ali Abdullah Saleh’s 33-year rule provides for only the shallowest of changes at the top of the regime, something the U.S. administration likely favored to preserve a fragile alliance against one of the world’s most active al-Qaida branches based in Yemen.

The plan drawn up by Yemen’s oil-rich Gulf neighbors does not directly change the system Saleh put in place over three decades to serve his interests.

“It gives an opportunity for regime survival,” said Yemen expert Ibrahim Sharqieh at the Brookings Doha Center. “The only one we’ve seen changing here is the president, but the state institutions and everything else remain in place. Nothing else has changed.”

Saleh signed the agreement Wednesday in the Saudi capital Riyadh, transferring power to his vice president within 30 days. If it holds, he will be the fourth dictator pushed from power this year by the Arab Spring uprisings.

But the deal leaves much more of the old regime intact than the uprisings in Tunisia, Egypt and Libya — something that will almost certainly translate into continued unrest. Protesters who have been in the millions for nearly 10 months were out again Thursday, rejecting a provision that gives Saleh immunity from prosecution.

Massive unrest around the world continues.  It is sad to see so much violence, but the spread of democracy into regions that have been ruled by harsh dictators and the fight to regain democracy in regions where corporatocracy has ruled is exciting in many ways.

What’s on your reading and blogging list today?


More Congressional Sleaze: Boehner and Cantor own stock in Goldman Sachs

Seth Cline of Open Secrets Blog reports some extremely disturbing connections between Congressional leaders and Goldman Sachs.  I think it’s time for a law that places congressional investment accounts into a blind trust.

According to research by the Center for Responsive Politics, 19 current members of Congress reported holdings in Goldman Sachs during 2010. Whether by coincidence or not, most of these 19 Goldman Sachs investors in Congress are more powerful or more wealthy than their peers, or both.

Nine of them sit on either the most powerful committee in their chamber or committees charged with regulating the Wall Street giant. Moreover, seven of them are among the 25 wealthiest members of their respective chambers, according to the Center’s research.

And of the six lawmakers who fall into neither category, two are the most influential Republicans in the U.S. House of Representatives: House Speaker John Boehner (R-Ohio) and House Majority Leader Eric Cantor (R-Va.).

Altogether, the 19 had at least $480,000 and as much as $1.1 million invested in Goldman Sachs in 2010, the most recent year personal finance data are available. That’s an average of about $812,900 for these 19 lawmakers’ holdings combined.

Lawmakers are only required to report their personal assets and liabilities in broad ranges, meaning it’s impossible to know the precise value of these holdings. The Center uses the minimum and maximum values listed on the filings to calculate an average value for each asset and liability.

But these financial interests are not a one-way street: Goldman Sachs employees and its political action committee have contributed about $124,000, combined, to a dozen of the lawmakers who reported holdings in the company in 2010, according to the Center’s research. This includes all money given during the 2010 election cycle and thus far in 2011.

So, not only do Boehner and Cantor get donations from Goldman Sachs, they are also stock holders.  No wonder they want to get rid of the Volcker Rule.  Looks like Paul Ryan is an investor also.

In the leadership category are names such as Boehner and Cantor, each of whom has an average $32,500 invested in Goldman.

Goldman Sachs’ employees, meanwhile, have also contributed heavily to Boehner and Cantor.

Boehner has received $29,500, and Cantor $48,000, from them since 2009, according to the Center’s research.

Other Goldman investors with this kind of power include two members of the Joint Select Committee on Deficit Reduction, better known as the debt supercommittee.

The first, Sen. Jon Kyl (R-Ariz.), reported $1,177 invested in Goldman in 2010, and, as minority whip, is the second highest ranking Republican in the Senate.

And not only is Kyl a member of the supercommittee and party leadership, he also sits on the Senate Finance Committee, which regulates Goldman Sachs and its peers on Wall Street.

Another one of Kyl’s colleagues on the supercommittee, Rep. Fred Upton (R-Mich.), is also a Goldman investor.

Upton had an average of $8,000 invested in the company in 2010, according to the Center’s research.

Rep. Paul Ryan (R-Wis.), is another influential Goldman shareholder in Congress.

Ryan sits on two very important House committees: the Budget Committee, which he chairs, and the Ways and Means Committee.

Ryan reported an average of $8,000 invested in Goldman and has received $5,800 from the company’s employees so far this year after receiving $10,000 from them during the 2010 cycle, according to the Center’s research.

One of Goldman Sachs’ most valuable congressional investors is Rep. Randy Neugebauer (R-Texas), whose average of $550,000 in investments in the company is far and away the most in Congress.

Additionally Neugebauer sits on the House Financial Services Committee, which oversees Wall Street and the securities and investment industry of which Goldman is a part.

That also helps explain the $9,500 Goldman Sachs employees have contributed to Neugebauer since January 2009 through the company’s political action committee.

Rep. Gary Peters (R-Mich.) is another Goldman Sachs investor on the Financial Services committee. He has an average of $8,000 invested and has received $4,500 from the company this year from its PAC.

There’s a substantial list of Republicans listed that I didn’t include in the list above..  Democrats holding GS stock include  Sens. Ben Nelson (D-Neb.), Claire McCaskill (D-Mo.), Sheldon Whitehouse (D-R.I.) and Sen. Mark Warner (D-Va.).   The details are on a spreadsheet here.

Can you really believe that they’re acting in our best interest when their wealth is vested in stopping GS from doing suspect things like selling lemons to clients and placing side bets that the lemons lose?  I sure don’t.  The Volker Rule places trading restrictions on institutions like GS. It controls the types of transactions that GS can do in its proprietary trading like the example I just gave you. They settled fraud charges in the US with the SEC and are under investigation in the UK and some of Europe.  You may recall the unit and testimony before congress.  The US settlement came in 2010.  That’s the same year that these holdings were found by the Center for Responsive Politics.

The FSA opened its investigation into the bank in April after the SEC charged Goldman with misleading investors in a complex mortgage-backed security known as Abacus. The SEC claimed that Goldman had failed to disclose that a hedge fund that was betting against the security had selected some of the mortgage loans included in the portfolio, costing investors as much as $1bn.

The largest fine handed down by the UK regulator came three months ago, when JPMorgan paid a £33.3m for failing to keep client money in separate accounts.

Goldman, the world’s best-known investment bank, has seen its reputation tarnished in recent months as questions continue to swirl over whether it favoured the interests of some clients at the expense of others during the financial crisis.

The bank’s business model is also under pressure amid volatile markets and regulatory reforms that have forced it to shut some of its highly profitable “proprietary” trading operations.

No wonder we don’t see perp walks.  These folks have skin in GS.  We are so f’d.