November 27th, 2011
UK TelegraphBy James Kirkup, Deputy Political Editor
As the Italian government struggled to borrow and Spain considered seeking an international bail-out, British ministers privately warned that the break-up of the euro, once almost unthinkable, is now increasingly plausible.
Diplomats are preparing to help Britons abroad through a banking collapse and even riots arising from the debt crisis.
The Treasury confirmed earlier this month that contingency planning for a collapse is now under way.
A senior minister has now revealed the extent of the Government’s concern, saying that Britain is now planning on the basis that a euro collapse is now just a matter of time.
“It’s in our interests that they keep playing for time because that gives us more time to prepare,” the minister told the Daily Telegraph.
Recent Foreign and Commonwealth Office instructions to embassies and consulates request contingency planning for extreme scenarios including rioting and social unrest.
Greece has seen several outbreaks of civil disorder as its government struggles with its huge debts. British officials think similar scenes cannot be ruled out in other nations if the euro collapses.
Diplomats have also been told to prepare to help tens of thousands of British citizens in eurozone countries with the consequences of a financial collapse that would leave them unable to access bank accounts or even withdraw cash.
Fuelling the fears of financial markets for the euro, reports in Madrid yesterday suggested that the new Popular Party government could seek a bail-out from either the European Union rescue fund or the International Monetary Fund.
There are also growing fears for Italy, whose new government was forced to pay record interest rates on new bonds issued yesterday.
The yield on new six-month loans was 6.5 per cent, nearly double last month’s rate. And the yield on outstanding two-year loans was 7.8 per cent, well above the level considered unsustainable.
Italy’s new government will have to sell more than EURO 30 billion of new bonds by the end of January to refinance its debts. Analysts say there is no guarantee that investors will buy all of those bonds, which could force Italy to default.
The Italian government yesterday said that in talks with German Chancellor Angela Merkel and French President Nicolas Sarkozy, Prime Minister Mario Monti had agreed that an Italian collapse “would inevitably be the end of the euro.”
The EU treaties that created the euro and set its membership rules contain no provision for members to leave, meaning any break-up would be disorderly and potentially chaotic.
If eurozone governments defaulted on their debts, the European banks that hold many of their bonds would risk collapse.
Some analysts say the shock waves of such an event would risk the collapse of the entire financial system, leaving banks unable to return money to retail depositors and destroying companies dependent on bank credit.
The Financial Services Authority this week issued a public warning to British banks to bolster their contingency plans for the break-up of the single currency.
Some economists believe that at worst, the outright collapse of the euro could reduce GDP in its member-states by up to half and trigger mass unemployment.
Analysts at UBS, an investment bank earlier this year warned that the most extreme consequences of a break-up include risks to basic property rights and the threat of civil disorder.
“When the unemployment consequences are factored in, it is virtually impossible to consider a break-up scenario without some serious social consequences,” UBS said.
November 27th, 2011
Wall Street Journal
By DION NISSENBAUM in Kabul, TOM WRIGHT in New Delhi and OWAIS TOHID in Karachi
NATO and Afghan forces on a nighttime operation Saturday came under fire from across the border in Pakistan before they called in an air strike on two Pakistani military border posts that left 25 soldiers dead and the U.S.'s relations with Pakistan in tatters, according to Afghan and Western officials' version of events.
Pakistan's army reacted angrily, calling the "unprovoked" raid on the border posts an "irresponsible act." The military denied firing on NATO forces and questioned why the coalition undertook a sustained two-hour attack on well-known border positions, involving helicopters and fighter jets, which also injured 25 other soldiers.
"No first fire came from Pakistan troops," said a senior Pakistani military official Sunday. "But they did respond in self-defense after NATO gunship helicopters and jet fighters carried out unprovoked firing."
In retaliation, Pakistan indefinitely shut down North Atlantic Treaty Organization supply lines through Pakistan and said it was reevaluating its military, intelligence and diplomatic links with the U.S. Authorities gave the U.S. two weeks to pull out of a Pakistani airbase that Washington has used in the past to launch drone strikes on Taliban militants, attacks which have become increasingly unpopular among Pakistani people.
Pakistan Foreign Minister Hina Rabbani Khar, in a telephone conversation with U.S. Secretary of State Hillary Clinton on Sunday, communicated her "deep sense of rage" for the attack, which she said had set back efforts to improve relations, Pakistan's foreign ministry said in a statement.
On Sunday, NATO Secretary General Anders Fogh Rasmussen promised a full inquiry in to the "tragic unintended incident." He termed the deaths of Pakistani personnel "unacceptable and deplorable."
The Obama administration pledged a full investigation into the attack.
Mrs. Clinton, a U.S. government statement said Saturday, committed to reviewing the "circumstances of the incident" and stressed "the importance of the U.S.-Pakistani partnership."
The attack is a major setback for U.S. efforts to bring Pakistan onside as President Barack Obama's administration works to find an exit strategy from the 10-year war in Afghanistan.
Mrs. Clinton, in an October visit to Islamabad, attempted to forge an agreement with Pakistan to squeeze militants operating in Pakistan's border areas and to get the country's help in bringing Taliban leaders to peace talks.
A Western official with knowledge of the discussions said both sides had begun to rebuild confidence ahead of a key international meeting in Bonn, Germany, next month to discuss the situation in Afghanistan.
The attack Saturday set the clock back on a relationship that had only just begun to recover from a number of incidents, including the secret U.S. raid that killed Osama bin Laden on Pakistani soil in May and the killing of two Pakistani men in Lahore by a Central Intelligence Agency contractor in January.
"It will be difficult to make much progress in the days to come," the Western official said.
The incident took place hours after Gen. John R. Allen, the coalition commander in Afghanistan, met Friday with army officers in Pakistan to reduce rising tension on the poorly demarcated border. Gen. Allen said a one-star coalition general will lead an investigation into Saturday's deaths.
Afghan and U.S. officials say their troops are increasingly facing fire from Pakistan's side of the border. Pakistan is angry over the increased incidence of cross-border raids by Afghan and NATO forces.
As U.S. military, Pakistani forces and Afghan officials sought to piece together the deadly and destabilizing incident, three Afghan and one Western official said the attack took place in response to fire from the remote Pakistani posts in the Mohmand tribal region, a lawless border area that abuts Afghanistan's eastern Kunar province.
Two Afghan officials working in the border area where the attack took place said Sunday that the joint force was targeting Taliban forces in the area when it received fire from a Pakistan military outpost. That prompted the coalition force to call for an air attack on the Pakistani posts, said an Afghan Border Police official in the area. Pakistani officials were informed of the operation before it took place, he said.
"There was firing coming from the position against Afghan army soldiers who requested support and this is what happened," said a third Afghan official in Kabul, where Gen. Allen met with top government leaders for a special security meeting to discuss the incident. The Afghan official in Kabul said the government believes that the fire came from the Pakistan base—and not from insurgents operating nearby.
That view was bolstered by one Western official who discussed the attack with military officials in Kabul on Sunday.
"They were fired on from a Pakistani army base," the Western official in Kabul said. "It was a defensive action."
A U.S. official in Kabul said insurgents may have been firing into Afghanistan near the Pakistani border outpost Saturday morning, which prompted coalition forces to strike back. He pointed to an incident in September 2010, when a NATO helicopter fired on a Pakistan outpost, killing two soldiers.
"It was a situation where insurgent forces butted right up against a Pakistani border post and used that as a firing position. When we fired back, we hit Pakistani security forces. This is a possibility we're circulating here for Saturday's incident," the official said.
Military officials in Kabul said insurgents in Pakistan have also used empty Pakistan border bases to stage attacks, which may have been the working assumption of the coalition forces who called in the air strike.
Pakistan's military disputes this version of events. Military officials say the posts were attacked without warning at 2 a.m, while most of the around 50 soldiers were sleeping, and that NATO helicopters and jets even attacked Pakistani military forces sent in as back-up during the two-hour assault. Pakistan says it has increased the number of soldiers at border posts like these as part of a campaign in Mohmand this year to wipe out the Taliban in the area.
Pakistan's military set up check posts in the mountainous terrain of the Mohmand tribal agency after security forces launched a crackdown there against the Pakistan Taliban earlier this year. Officials claimed to have destroyed the Pakistan Taliban's training centers and bases, declaring the Mohmand region cleared of insurgents. Local tribal fighters supported the security forces.
The posts hit by NATO on Saturday are built on the mountain called Salala in Mohmand. The area borders parts of Afghanistan that are believed to be Afghan Taliban strongholds, and Pakistan Taliban routed in the offensive are believed to have fled there. Tribal elders of the local lashkars, or peace committees, in Mohmand are infuriated over the NATO attack and issued warnings of waging a fight with coalition forces Sunday.
"We have sacrificed our lives in the fight against Taliban who killed hundreds of our tribesmen," said Malik Mohammad Ali, a tribal elder from Mohmand.
The incident comes as the U.S. has begun to more publicly voice concerns that Pakistan's military, despite fighting militants in places like Mohmand, is harboring some factions of the Taliban as a way of influencing events in Afghanistan after most international troops pull out in 2014. At the least, U.S. officials say, Pakistan is failing to stop some militants firing on U.S. troops from close to Pakistani military posts.
But the U.S. also has attempted to get Pakistan army chief, Gen. Ashfaq Parvez Kayani, to play a larger role in bringing the Taliban into nascent peace talks that have so far failed to bear fruit.
Gen. Kayani's ability to accede to U.S. demands is greatly limited by events like the one Saturday, which stoke anti-U.S. fervor in Pakistan, said Talat Masood, a retired general and defense analyst.
"Those who have been more moderate, even those people are asking is it worth having a relationship with the U.S.?" Mr. Masood said. "It will be very difficult for Gen. Kayani to defend the alliance."
Mr. Masood said he had taped a television chat show Saturday after the attack on the border posts during which he was the only participant arguing that the U.S. wouldn't have targeted Pakistani soldiers in Mohmand as a deliberate act of aggression.
Few observers, though, expect a complete breakdown in relations.
Pakistan has shut its border, which will temporarily hurt NATO's supply chain to Afghanistan, but the country continues to rely on billions of dollars in military and civilian aid from the U.S. Washington, likewise, needs Pakistan to keep up pressure on Taliban militants in the tribal region, and as a supply route.
"This is a need-based relationship. It will have its temporary hiccup, probably in the form of the suspension of NATO cargo," said Imtiaz Gul, director of the Center for Research and Security Studies, an Islamabad-based think tank.
During the national security meeting Sunday, Afghan leaders also solidified plans to carry out the second phase of plans for coalition forces to cede security control to Afghan forces across the country.
The new plan includes six of the country's 34 provinces, including Kabul, seven major cities, including Jalalabad, and dozens of districts, including Helmand province's Marjah, which was the first target last year of U.S. Marines at the forefront of the American military surge meant to cripple the Taliban-led insurgency.
If the transition is a success, it will put Afghan forces in the lead in protecting more than half of the country's population, officials said.
During the first phase of the transition process carried out earlier this year, Afghan forces assumed control of seven cities and provinces.
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—Maria Abi-Habib and Habib Khan Totakhil in Kabul contributed to this article.
November 27th, 2011
By Jon Ward and Mark Blumenthal
WASHINGTON -- The first two months of 2012 represent Mitt Romney's best chance to deliver a knockout blow in the Republican presidential primary.
If he cannot do so, he could be in for a drawn-out primary similar to the 2008 Democratic race.
The conventional wisdom has been that the primary will likely be decided on Jan. 31 in Florida, which goes fourth in the series of caucuses and primaries, and is the most expensive contest. Some think Romney could end things in Iowa on Jan. 3 if he wins those caucuses convincingly. Even if he places second or third there but goes on to win New Hampshire on Jan. 10, South Carolina on Jan. 21 and Florida, many think those victories could create the impression of inevitability.
But the 2012 primary calendar is heavily back-loaded, with major states such as California and New York going much later in the process than in 2008 and far fewer delegates up for grabs through Super Tuesday. In fact, the altered calendar will create the most spread-out contest since the 1970s. And more states than in the past will award delegates based on each candidates' portion of the vote, rather than all of a state's delegates going to the winner of the popular vote. All together, it will be mathematically impossible for Romney -- or anyone -- to eliminate opponents early on.
On the other hand, none of Romney's primary opponents appear capable of uniting the party's fractured conservative base and simultaneously convincing the rest of the GOP that they can win a general election match-up with Obama. Former Speaker of the House Newt Gingrich is currently surfing a wave of momentum, but he has a long record to attack, a troubled personal past and little organization compared to other campaigns, especially Romney's.
But given the strong anti-Romney sentiment still surging through portions of the Republican Party -- combined with the fact that the race for delegates between Barack Obama and Hilary Clinton in 2008 educated the public and the press about the importance of electoral math over an impression of momentum -- it's questionable whether Romney can clear the field early on and cruise to victory.
If Romney doesn't blow his competition away in January, he will still likely do very well in the contests between Florida and Super Tuesday on March 6.
The February states are Maine, Nevada, Colorado, Minnesota, Missouri, Arizona and Michigan. In 2008, Romney won all but Arizona, which was John McCain's home state.
Yet, mathematically, it will be hard for Romney to argue after January and February that he is the putative nominee.
There are approximately 2,427 delegates up for grabs in the 2012 Republican primary, but a number of states who broke Republican National Committee rules and moved their primaries forward will likely see their delegate totals halved. So the actual number of total delegates will probably be 2,284, meaning a candidate will have to win 1,143 to clinch the nomination.
Through January and February, according to the website TheGreenPapers.com, only 334 delegates will be awarded. Super Tuesday will add only 599 more -- a total of just 41 percent of all delegates.
RNC rule changes this year encouraged states to delay their primaries until later in the year. Some of the states with the most delegates won't vote until late spring or even as late as the summer. New York and Pennsylvania will award their 95 and 72 delegates, respectively, on April 24. California's mother lode of 172 delegates won't be up for grabs until June 5.
Meanwhile, the first events in Iowa, New Hampshire and the other early states will kick off in early January on roughly the same schedule as four years ago.
The new RNC rules have also shifted some states to a more proportional awarding of delegates, making the process similar to the Democratic model. The largest state to vote on Super Tuesday is Texas, which awards 155 delegates -- but Texas has chosen to award its delegates proportionally. So a few candidates, not just one, could reap healthy delegate yields in the Lone Star state.
The consequence of these rule changes is the least front-loaded primary calendar in decades, featuring the longest-ever gap between Iowa and Super Tuesday.
In 2008, the Republican primary was very different. McCain lost Iowa to former Arkansas Gov. Mike Huckabee but won New Hampshire, South Carolina and Florida. Then on Super Tuesday, he won the lion's share of delegates: 629 to Romney's 217 and Huckabee's 167.
Super Tuesday 2008 was the biggest ever, with caucuses or primaries held in 21 states, which ultimately sent 1,247 delegates to the Republican convention -- over half the total delegates, just 33 days after the Iowa caucuses.
With McCain enjoying a commanding lead and with most of the races decided, the math was solidly in McCain's favor. Romney ended his campaign two days later.
Such a scenario cannot repeat in 2012.
Not only is the primary calendar more spread out, but some think the states voting on Super Tuesday add up to a slate that does not favor Romney.
In a scenario where a candidate other than Romney has survived January and February and heads into March with some momentum, "Romney's candidacy would be at great risk on Super Tuesday when southern and border state voting could vault a conservative challenger to Romney to a strong delegate lead that Romney might never erase," said Jeffrey G. Berman, who was national delegate director for Obama's 2008 campaign.
"Winning more states and delegates on Super Tuesday was key to Obama's success in 2008," Berman told The Huffington Post.
Berman has a point. Romney, in 2008, won only four of the 11 states slated to go to the polls this Super Tuesday. And in two of the biggest delegate-yielding states -- Virginia and Texas -- Romney got annihilated. Romney won just 3.7 percent of the vote in Virginia last time, and in Texas he did even worse, receiving only a measly 2 percent.
McCain's January wins in New Hampshire, South Carolina and Florida helped set him up to score 51 percent in Texas, 50 percent in Virginia and big wins in other key states on Super Tuesday 2008. But McCain's momentum benefited from the fact that the political class had not yet seen the battle for delegates play out between Obama and Clinton.
If one candidate, such as Gingrich or Rick Perry, emerges during January as Romney's top rival, and the anti-Romney vote consolidates behind him or her, that candidate can argue that he or she still has a mathematical path to victory.
And if the numbers are plausible, the press and the public will pay attention.
Gingrich has already begun to give voice to this line of reasoning.
"What you don't know yet is whether one of us can run the table, in which case it gets over early; or whether, because of proportional representation, you're into what happened to Hilary and Obama, and you're still slugging it out in May and June," Gingrich said in an interview with the New Hampshire Union Leader last week.
"And I think you've got to prepare for both."
A big question about Gingrich is whether he can, in fact, prepare for either. Especially in terms of his organization, Gingrich is way behind the other candidates. Romney has been preparing and organizing for years, building on the infrastructure of the 2008 campaign.
The Romney campaign will be hoping to create a dynamic of momentum on their side similar to the one McCain generated by winning in January and then dominating the February contests. Romney will have to perform well and his campaign will have to out-organize the others. Those two things are achievable and likely.
But they'll also have to persuade the press and the public that they are in the driver's seat. And this is not entirely in their control, thanks to the lessons of 2008 -- and thanks to the extended calendar of 2012.
Romney's rivals are certainly hoping for a protracted primary battle and do not view the early states as must-wins, as they might have in the past.
"I'd sure like to do the best I can in all the early primaries, but I've got to have an ability to sustain a campaign all the way," Gingrich said in the Union Leader interview.
"I have to be in the top three in Iowa and the top three in New Hampshire. I'd like to be first in Iowa and first in New Hampshire, and we'll see. But I have to be in the top three. I think if we go south, and I am a viable candidate, I'll win South Carolina, and I think that just changes the environment for Florida," he said.
Rep. Ron Paul (R-Texas) will also likely be a significant factor, especially in a long primary. Paul polls well in Iowa and New Hampshire, and more importantly, his campaign is organizing in many of the caucus states where candidates can win many or all of the state's delegates with an intense effort from a committed base, a description that captures Paul's supporters.
Jesse Benton, Paul's campaign manager, outlined such a strategy in a recent interview with HuffPost.
"A presidential campaign is about winning delegates, and we're putting together a targeted nationwide organization in primarily caucus and convention states to win delegates. Iowa and New Hampshire are important, and we're competing hard there. But that's only half our effort," Benton said. "We don't need to win those states. We need top three in those states."
"Those caucus states are about intensity, organization," Benton said. "I'm talking about Nevada, Louisiana, Maine, Minnesota, North Dakota, Kansas, Missouri. We're putting in winning organizations in those states. It's going to take about 3,000 votes to win North Dakota caucus and take their 28 delegates. We're positioned to do that."
Still, even with the calendar and the math making Romney's road more difficult, it wouldn't hurt to deny him a quick victory in January, too.
"If Romney pitches a shutout in the first four contests, the perception will be such that it will be difficult for us to continue to compete," Benton said, acknowledging the conventional wisdom that still pervades. "We need to shake some things up. We need to show some strength, too."
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November 27th, 2011
Cr Edit note: Funny how several major news venues are running this story under the title: "Gingrich wins Union leader's endorsement."
Now if you didn't know any better, what would you think as a Right-Wing primary voter?
I'm just saying...sometimes the attempt is subtle, but it's always there when it comes to the mainstream media......beware and be aware...
GOP presidential hopeful Newt Gingrich received the endorsement of the influential editorial board of the New Hampshire Union Leader on Sunday, providing another boost to his surging campaign.
The endorsement gives the former House Speaker additional momentum after a month which has seen him vault to the top of national GOP polls.
"We are in critical need of the innovative, forward-looking strategy and positive leadership that Gingrich has shown he is capable of providing," said the editorial by publisher Joseph W. McQuaid.
"A lot of candidates say they're going to improve Washington. Newt Gingrich has actually done that, and in this race he offers the best shot of doing it again," he added.
The Gingrich campaign said it was "honored to have the endorsement," calling it "an enormous boost to our campaign," reported NBC News.
The Union Leader endorsement is highly regarded in the early primary state. Candidates often meet with the editorial board and place great emphasis on securing its backing.
The failure to win the board's endorsement may be a setback for former Massachusetts Gov. Mitt Romney's campaign which has struggled to win support from Tea party-affiliated voters and the right-wing of the GOP base.
Drew Cline, editorial page editor for the Union Leader, spoke about the board's decision on CNN Sunday morning. Cline said that the board's "two favorites were probably Perry, Gingrich."
He added that the board, which failed to endorse Romney in 2008 as well gave "every candidate serious consideration."
However explaining his view on the difference between the two candidates, he added that "Romney's a guy who wants to be liked, a politician who wants to be liked. Gingrich is a politician who wants to be respected."
"I'm not sure precisely what we get out of a President Romney, who could be a very good president," he said.
Yet despite the endorsement and Gingrich's new lead in many national polls, Romney still holds a commanding lead in New Hampshire’s first-in-the-nation primary.
A Suffolk University/7News poll released last week showed Romney winning the support of 41 percent of likely GOP voters surveyed. Gingrich only secured 14 percent, tied with Texas Rep. Ron Paul for second place.
Another poll by the American Research Group last week showed Gingrich closing the gap in New Hampshire but still trailing Romney by 11 percent.
The Union Leader's endorsement while coveted and influential has not always translated into a victory in the Granite State. The paper endorsed Ronald Reagan for the 1976 GOP primary, yet saw then-President Gerald Ford win. In 1980, the paper backed Reagan again who went on to win the primary and his party's nomination.
In 1988, however, the paper backed Pete du Pont who fell to George H.W. Bush in the primary. Pat Buchanan won the board's support in 1992, but failed in his challenge to then-President Bush, eventually winning with the paper's backing in 1996.
In 2000, the paper backed businessman Steve Forbes who would lose the primary to Arizona Sen. John McCain.
November 26th, 2011
NAPLES, FL -- For more than four hours, a long line wrapped around the entire top floor of Books-A-Million here just to have the chance to visit briefly with Newt Gingrich and his wife, Callista.
“Frankly, like the bookstore, we are a little overwhelmed by the turnout here this morning,” the former House speaker told the more than 650 people who came out Saturday to copies of the Gingrich’s books autographed. “So thank you all for being here.”
One attendee, 8-year-old Katrina Russell, not only had a book autographed for her father, but also asked the presidential hopeful a few questions she had prepared.
“If you become president, will you order Godfathers Pizza?” Katrina asked Gingrich, reading off of a hand-written index card that Gingrich later wrote “good questions” on the back of.
“I like Herman Cain and Godfathers Pizza is good but I eat too much pizza, I’m not supposed to eat pizza,” the Speaker responded with a smile and was asked two more questions by the little girl.
“Someday if you work hard, you can grow up and be one of these folks,” Gingrich said as he nodded to the gathered media.
Later, Katrina, who one day hopes to be a reporter, told the press she would vote for Speaker Gingrich if she could.
“He’s a good person and I know that he’ll make good laws and that he’ll set the U.S.A. to some peace and he’s a really good person and that’s why I’m voting for him,” she added.
During the book signing, the Michele Bachmann campaign sent out an email accusing Gingrich of being the “most liberal GOP candidate on the issue of immigration reform.”
“Either Michele Bachmann can’t get her facts straight on understanding immigration reform or she is intentionally lying. Either of, it is disappointing in a presidential candidate,” spokesman R.C. Hammond told NBC News at the event in Southwest Florida.
Gingrich addressed this topic with the press after the rather long event concluded: “I am very happy to debate all of my friends in this race but it would be nice if they stuck to the facts and were willing to work at being honest.”
He also added about those who he spoke with Saturday: “it’s very interesting, the number of people who say I appreciate and agree with your position on immigration was substantial and no one said they were offended.”
All of the roughly 550 copies of the Speaker’s ‘A Nation Like No Other’ and ‘Battle of the Crater’ sold out early this morning at the Books-A-Million (and many other local bookstores were sold out as well), in addition to about 200 copies of Callista’s ‘Sweet Land of Liberty.’
Gingrich was very pleased with the massive turnout for the second day in a row (last night’s town-hall event in Naples drew a crowd of roughly 750) and said he believes he can do very well in Florida’s primary.
“I think it will be pretty clear by Jan. 31st that I will be the conservative candidate in the race. I think by then it’ll probably be Gov. Romney and me,” Gingrich said.