September 9th, 2011
The Washington Post
The new conventional wisdom on 9/11: We have created a decade of fear. We overreacted to 9/11 — al-Qaeda turned out to be a paper tiger; there never was a second attack — thereby bankrupting the country, destroying our morale and sending us into national decline.
The secretary of defense says that al-Qaeda is on the verge of strategic defeat. True. But why? Al-Qaeda did not spontaneously combust. Yet, in a decade Osama bin Laden went from the emir of radical Islam, jihadi hero after whom babies were named all over the Muslim world — to pathetic old recluse, almost incommunicado, watching shades of himself on a cheap TV in a bare room.
What turned the strong horse into the weak horse? Precisely the massive and unrelenting American war on terror, a systematic worldwide campaign carried out with increasing sophistication, efficiency and lethality — now so cheaply denigrated as an “overreaction.”
First came the Afghan campaign, once so universally supported that Democrats for years complained that President Bush was not investing enough blood and treasure there. Now, it is reduced to a talking point as one of “the two wars” that bankrupted us. Yet Afghanistan was utterly indispensable in defeating the jihadis then and now. We think of Pakistan as the terrorist sanctuary. We fail to see that Afghanistan is our sanctuary, the base from which we have freedom of action to strike Jihad Central in Pakistan and the border regions.
Iraq, too, was decisive, though not in the way we intended. We no more chose it to be the central campaign in the crushing of al-Qaeda than Eisenhower chose the Battle of the Bulge as the locus for the final destruction of the German war machine.
Al-Qaeda, uninvited, came out to fight us in Iraq, and it was not just defeated but humiliated. The local population — Arab, Muslim, Sunni, under the supposed heel of the invader — joined the infidel and rose up against the jihadi in its midst. It was a singular defeat from which al-Qaeda never recovered.
True, in both wars there was much trial, error and tragic loss. In Afghanistan, too much emphasis on nation-building. In Iraq, the bloody middle years before we found our general and our strategy. But cannot the same be said of, for example, the Civil War, the terrible years before Lincoln found his general? Or the Pacific campaign of World War II, with its myriad miscalculations, its often questionable island-hopping, that cost infinitely more American lives?
In the end: 10 years, no second attack (which everyone assumed would come within months). That testifies to the other great achievement of the decade: the defensive anti-terror apparatus hastily constructed from scratch after 9/11 by President Bush, and then continued by President Obama. Continued why? Because it worked. It kept us safe — the warrantless wiretaps, the Patriot Act, extraordinary rendition, preventive detention and, yes, Guantanamo.
Perhaps, says the new conventional wisdom, but these exertions have bankrupted the country and led to our current mood of despair and decline.
Rubbish. The total cost of “the two wars” is $1.3 trillion. That’s less than 1/11th of the national debt, less than one year of Obama deficit spending. During the golden Eisenhower 1950s of robust economic growth averaging 5 percent annually, defense spending was 11 percent of GDP and 60 percent of the federal budget. Today, defense spending is 5 percent of GDP and 20 percent of the budget. So much for imperial overstretch.
Yes, we are approaching bankruptcy. But this has as much to do with the war on terror as do sunspots. Looming insolvency comes not from our shrinking defense budget but from the explosion of entitlements. They devour nearly half the federal budget.
As for the Great Recession and financial collapse, you can attribute it to misguided federal policy pushing homeownership through risky subprime lending. To Fannie and Freddie. To greedy bankers, unscrupulous lenders, naive (and greedy) home buyers. To computer-enabled derivatives so complicated and interwoven as to elude control. But to the war on terror? Nonsense.
9/11 was our Pearl Harbor. This time, however, the enemy had no home address. No Tokyo. Which is why today’s war could not be wrapped up in a mere four years. It was unconventional war by an unconventional enemy embedded within a worldwide religious community. Yet in a decade, we largely disarmed and defeated it, and developed the means to continue to pursue its remnants at rapidly decreasing cost. That is a historic achievement.
Our current difficulties and gloom are almost entirely economic in origin, the bitter fruit of misguided fiscal, regulatory and monetary policies that had nothing to do with 9/11. America’s current demoralization is not a result of the war on terror. On the contrary. The denigration of the war on terror is the result of our current demoralization, of retroactively reading today’s malaise into the real — and successful — history of our 9/11 response.
September 9th, 2011
Hundreds Tear Down Compound Walls, Breach Building, Dump Hebrew-Language Documents Out Window, Ambassador Evacuated…
We have been talking about it…. It looks like it’s started... CAIRO (AP) — A group of about 30 protesters [note looks more like 3,000 to me /SD] broke into the Israeli Embassy in Cairo Friday and dumped hundreds of documents out of the windows after a day of demonstrations outside the building in which crowds swinging sledge hammers and using their bare hands tore apart the embassy’s security wall.
Protesters use a light pole to knock down a concrete wall built in front of the Israeli embassy in Cairo September 9, 2011. Activists on Friday tore down the wall, built to protect it from demonstrators, witnesses said. (AP Photo/Khalil Hamra)
Israel’s ambassador, Yitzhak Levanon, his family and other embassy staff were waiting at Cairo’s airport for a military plane to evacuate them, said airport officials who spoke on condition of anonymity because they were not authorized to speak to the media.
Hundreds of protesters converged on the embassy throughout the afternoon and into the night, tearing down large sections of the graffiti-covered security wall outside the 21-story building housing the embassy. Egyptian security forces made no attempt for hours to intervene.
Egyptians demolish a concrete wall built around a building housing the Israeli Embassy in Cairo, Egypt, to protect it against demonstrators Friday, Sept. 9, 2011. Hundreds of Egyptian protesters tore down parts of a graffiti-covered security wall that had recently been put up near the entrance of the Israeli Embassy in Cairo. Egyptian security forces did not intervene as crowds climbed the embassy security wall, pummeled it with hammers and tore away large sections of the barrier. (AP Photo/Khalil Hamra)
Just before midnight, a group of protesters reached a room on one of the embassy’s lower floors at the top of the building and began dumping Hebrew-language documents from the windows, said an Egyptian security official who spoke on condition of anonymity because he was not authorized to speak to the media.
Egyptian activists burn a depiction of an Israeli flag as they demolish a concrete wall built around a building housing the Israeli embassy in Cairo, Egypt, to protect it against demonstrators, Friday, Sept. 9, 2011. Hundreds of Egyptian protesters tore down parts of a graffiti-covered security wall that had recently been put up near the entrance of the Israeli Embassy in Cairo. Egyptian security forces did not intervene as crowds climbed the embassy security wall, pummeled it with hammers and tore away large sections of the barrier. (AP Photo/Khalil Hamra)
In Jerusalem, an Israeli official confirmed the embassy had been broken into, saying it appeared the group reached a waiting room on the lower floor. He spoke on condition of anonymity because he was not permitted to release the information. (read more)
September 9th, 2011
The Daily Caller / Matt Lewis
(if you drive a car, car;) - I’ll tax the street;
(if you try to sit, sit;) - I’ll tax your seat;
(if you get too cold, cold;) - I’ll tax the heat;
(if you take a walk, walk;) - I'll tax your feet.
If this sounds farfetched, it’s not.
With a new congressional “super committee” tasked with finding $1.5 trillion in cuts by November, creative ways to find additional revenue are in high demand. And allowing the IRS to prepare you taxes could be one solution.
The idea has been around for a while, but has been picking up steam in recent years. In 2006, Senate Finance Committee Chairman Max Baucus (D-Mont.) argued it would close a $345 billion annual difference between what the government believes taxpayers owe them and what the IRS actually collects, which he calls the “tax gap.”
“I think the solution [to the tax gap problem] is to get rid of the middle-man and no fees required,” he said.
Obama’s former Chairman of the Council of Economic Advisers Austan Goolsbee made a strong case for it in a 2006 New York Times op-ed, explaining, “… the revenue service could send you a tax form already filled out with the information it has for you — a Simple Return — rather than a blank tax form. You would simply check the numbers against your W-2 and 1099 and then sign it.”
But this isn’t just an idea floated by senators and presidential advisers. While running for president, then-Sen. Barack Obama touted it during a 2007 speech at the Tax Policy Institute: “The government already collects wage and bank account information,” he said, “so there’s no reason the IRS can’t send Americans pre-filled tax forms to verify.”
While the notion of allowing government to encroach on yet another aspect of our lives might sound like a hard sell, members of the Computer and Communications Industry Association (CCIA) believe this is a very real threat.
“There is a fundamental conflict of interest if the tax collectors also become the tax preparer,” said CCIA President and CEO Ed Black. “If you don’t trust the fox to guard your hen house, why trust the IRS to do your taxes. It’s the same exact thing. They make it sound so convenient, but it’s really just a convenient way to kiss your deductions and tax credits goodbye.”
Black is among the increasing number of voices who worry the “super committee” might see this as a quick way to raise taxes by $345 billion per year – the amount of the “tax gap” – without a single member of Congress ever having to vote for a tax increase.
“Most members of Congress, especially the Republicans, do not want to vote for a tax increase,” Black said. “But if the super committee calls having the IRS do people’s taxes an ‘accounting change’ or a ‘convenience to the taxpayer,’ they raise taxes by hundreds of billions of dollars per year and no one even knows about it.”
Advocates argue that allowing the IRS to prepare tax returns is a creative solution that simplifies the tax code, provides convenience to the taxpayer, and helps America balance its budget. As then-Senator Obama said during that same 2007 campaign speech: “Making this change would save Americans more than two billion dollars in tax preparer fees, more than 200 million hours of work, and an incalculable amount of headache and heartburn.”
“This mean’s no more worry. No more wasted time. No more extra expenses for a tax preparer,” he said.
“It’s brilliantly Machiavellian,” says CCIA’s Black.
So how would letting the IRS do your taxes actually close a $345 billion annual “tax gap”?
First, it’s important to note that your accountant or storefront tax prep company like H&R Block or electronic-filing software — whoever helps you do your taxes — all work for you. Sure, they must comply with the law, but it is in their best financial interest to help you pay as little as legally appropriate. If they do this well, you will continue to use them. In a sense, they have an adversarial relationship with the IRS.
But there’s another systemic problem. Goolsbee is correct in noting that the government already knows how much money you earn (via W2 forms and 1099′s). But what they do not necessarily know (unless you assume they know all) is which tax credits and deductions you might be legally entitled to.
“The IRS can do your taxes only if it has all your financial information,” explains Grover Norquist, president of Americans for Tax Reform. “The demands for more information about your economic life will increase.”
For example, if you get married or have a baby, getting a deduction would be contingent on informing the IRS of your change of life status. The same goes for buying or selling a house, caring for a sick relative, giving to charity, or any of the other ‘life events’ that might lower the amount of taxes you owe the government or entitle you to a bigger refund.
“If the IRS does the preparation,” says Club for Growth executive director David Keating, “people will wind up paying too much because the IRS won’t be on the lookout for loopholes that could cut your taxes now, or next year.”
But the fact that citizens would likely pay too much is a feature, not a bug.
In March, Congressman Jim Cooper (D-TN-05) introduced the Simple Return Act (H.R. 1069). The congressman’s press release called it, “a bill that would get the IRS to do your taxes for you.” He also noted that the Simple Return would allow the IRS to fill out a basic tax return for every American with the financial information it already receives from each taxpayer’s employer and financial institution: W-2 and 1099.
Cooper estimated that 40 million Americans would be eligible for the service, but some suspect this would just be the beginning. To combat the push, Rep. Sam Johnson (R-Tex.) has authored H.R. 2528, the Taxpayer Freedom Protection Act, “to rescind the authority of the Secretary of the Treasury to develop a return-free tax system.”
It is unclear whether or not the “super committee” will actually propose this “solution,” but anti-tax activists, as well as those who represent the interests of tax preparers, are taking it seriously. Still, for something that has been openly discussed by everyone from Barack Obama to senators and congressmen, the idea is receiving remarkably little press coverage.
September 9th, 2011
Staff Writer, CNBC.com
Christine Lagarde, the managing director of the International Monetary Fund, warned that the global economy is entering a "dangerous new phase" on Friday, ahead of the G7 summit in Marseilles, France.
Yoshikazu Tsuno | AFP | Getty Images
French finance minister Christine Lagarde is seen as a front-runner to succeed Strauss-Kahn.
"Policymakers should stand ready, as needed, to take more action to support the recovery, including through unconventional measures," Lagarde said.
"The world is collectively suffering from a crisis of confidence, in the face of a deteriorating economic outlook and rising concerns about the health of sovereigns and banks."
Her speech at Chatham House in London came after a turbulent week for the markets, with the focus on sovereign debt issues in the euro [EUR=X 1.3646 -0.0235 (-1.69%) ] zone and job creation in the US.
She welcomed President Obama's new $450 billion jobs package, announced Thursday, but added "it remains critical for the United States to clarify its medium term plan."
The British government, including Chancellor of the Exchequer George Osborne, who also spoke, was warned that "risk levels are rising" in the UK and the government needs to have a "heightened readiness to respond."
However, Lagarde conceded that the government's response "remains appropriate."
When Lagarde called for the recapitalization of European banks at the Jackson Hole summit in the United States in August, a flight away from European banks resulted in the markets.
Osborne agreed that the situation is "more complex" than in 2008 but described his government's plan as a "rock of stability".
"The underlying cause is the same – excessive levels of debt," he said.
He backed Tim Geithner, the US Treasury Secretary, who wrote in the Financial Times on Friday that the three most important elements for boosting growth are: strengthening growth in the US, stronger actions in Europe to halt the debt crisis and emerging markets like China allowing their currencies to adjust to market forces.
One of the factors weighing down markets is the perception that the situation is worse than 2008, and that there are fewer policy options available to governments and central banks.
Osborne warned that "nothing would be more damaging" to the British economy than an increase in interest rates.
The Bank of England Thursday held its interest rate unchanged at 0.5 percent, a historic low, which has now been in place for two and a half years.
He also supported greater fiscal and institutional integration in the euro zone.
This stance is fast becoming popular, although there has not been any clear signal as to what greater integration would involve.
Stephen King, chief economist at HSBC, told CNBC.com after the speech on Friday that he believed a "fiscal club" would work for the euro zone.
"Countries that don't stick to the guidelines would have their memberships suspended, and if a country chooses not to sign up, it won't get the benefits other countries do and will be pushed to the edge of the euro zone," he said.
"It will not be a proper member of the euro zone."
"As time goes by, there's a danger of getting worse rather than better."
Friday's G7 meeting will include discussions on the risks facing the economy at the moment.
The changing landscape in the Middle East and North Africa following the Arab Spring, and how more advanced economies can help the countries which are transforming their governments, will also be on the agenda.
September 9th, 2011
LA Times Blog
Speaking on behalf of millions of Americans who've grown angry and frustrated over the president's 32-month ineffective inactivity on the job creation front, President Obama on Thursday told members of Congress they really have to do something about the crummy employment situation -- and do it quickly.
Citing the plight of millions of struggling Americans whose wishes for jobs Obama ignored for most of the 961 days he's been in office while chasing shinier healthcare and financial reforms, Obama said it was time that Congress stop blaming others. He said it was time members take responsibility for their inaction and halt their phony partisan games and political circus acts that pervade Washington culture.
Because the Americans Obama hasn't been listening to are really hurting now. And -- who's....
Obama, whose Democratic spending priorities have pushed the national debt beyond $14,000,000,000,000, said it was important to curb spending and keep to the deficit reduction plan agreed to earlier this summer while also investing in, you know, many important things.
He then provided a joint session of Congress with a broadly ambitious list of goals that sounded to many people very much like a lot more spending, like, say, the $787 billion economic stimulus bill of 2009 that didn't stimulate much of anything except that national debt.
With the national debt already increasing $3 million every minute of every day, Obama wants to repair and modernize 35,000 schools. Obama wants $35 billion to go toward salaries for teachers, firefighters and police.
Obama wants $140 billion largely to update roads and bridges. Obama wants another $245 billion in business and individual tax relief. Obama also wants to extend unemployment benefits.
Obama didn't have room in his 4,021 word speech to mention how he intended to pay for all this new sounds-an-awful-like-increased-new-stimulus-spending-but-we're-not-using-that-word-anymore.
Aides said Americans should trust the president and sometime soon he would be outlining the finances that would not increase the national debt by one dime, honest.
Today in Virginia and next week in Ohio, Obama begins an aggressive autumn of travels selling his sounds-like-new-spending plans by day and fundraising by evening, bashing guess who for not solving the job crisis long ago.
Because like pretty much every sentient American, he knows full well there isn't one chance in Haiti of the divided Congress approving this package.
In fact, Obama's counting on that because grandiose program-proposing like this costs nothing-zero-nada, except the limo gas to the Capitol. Yet it gives perpetual candidate Obama tons of swell-sounding details to talk about during the 2011-12 reelection campaign.
Because he can't blame his mother-in-law for the nation's economic mess. When's the last time you heard a Harvard grad say, "Boy, did I blow that!" So, the only culprits left are in Congress, especially those Repugnicans.
But here's the catch that Obama and his Windy City wizards missed: Most Americans are not politically obedient machine Chicagoans. Like a linebacker reading the quarterback's eyes, they've already figured out this South Sider's game.
This week's ABC News/Washington Post Poll found that, based on their 961 days' experience with the current White House crowd, 47% say Obama's new economic program will have zero effect on the economy.
Worse politically, twice as many -- 34% vs 17% -- say Obama's plan will actually make matters worse, instead of better.
An NBC News/Wall Street Journal Poll the other day found 73% of Americans believe the nation is on the wrong track. That's 23 points more than felt that way at the beginning of summer.
Funny coincidence. The last time the revealing wrong track number was this high (78%) was in the autumn of 2008, just two weeks before Americans bought Obama's "Change to Believe In" line.
And they have the pink slips to prove it.