Obama's bold foreign policy

The Obama Doctrine
By Spencer Ackerman
March 24, 2008 | Prospect.org

When Sens. Hillary Rodham Clinton and Barack Obama met in California for the Jan. 31 debate, their back-and-forth resembled their many previous encounters, with the Democratic presidential hopefuls scrambling for the small policy yardage between them. And then Obama said something about the Iraq War that wasn't incremental at all. "I don't want to just end the war," he said, "but I want to end the mind-set that got us into war in the first place."

Until this point in the primaries, Clinton and Obama had sounded very similar on this issue. Despite their differences in the past (Obama opposed the war, while Clinton voted for it), both were calling for major troop withdrawals, with some residual force left behind to hedge against catastrophe. But Obama's concise declaration of intent at the debate upended this assumption. Clinton stumbled to find a counterargument, eventually saying her vote in October 2002 "was not authority for a pre-emptive war." Then she questioned Obama's ability to lead, saying that the Democratic nominee must have "the necessary credentials and gravitas for commander in chief."

If Clinton's response on Iraq sounds familiar, that's because it's structurally identical to the defensive crouch John Kerry assumed in 2004: Voting against the war wasn't a mistake; the mistakes were all George W. Bush's, and bringing the war to a responsible conclusion requires a wise man or woman with military credibility. In that debate, Obama offered an alternative path. Ending the war is only the first step. After we're out of Iraq, a corrosive mind-set will still be infecting the foreign-policy establishment and the body politic. That rot must be eliminated.

Obama is offering the most sweeping liberal foreign-policy critique we've heard from a serious presidential contender in decades. It cuts to the heart of traditional Democratic timidity. "It's time to reject the counsel that says the American people would rather have someone who is strong and wrong than someone who is weak and right," Obama said in a January speech. "It's time to say that we are the party that is going to be strong and right." (The Democrat who counseled that Americans wanted someone strong and wrong, not weak and right? That was Bill Clinton in 2002.)

But to understand what Obama is proposing, it's important to ask: What, exactly, is the mind-set that led to the war? What will it mean to end it? And what will take its place?

To answer these questions, I spoke at length with Obama's foreign-policy brain trust, the advisers who will craft and implement a new global strategy if he wins the nomination and the general election. They envision a doctrine that first ends the politics of fear and then moves beyond a hollow, sloganeering "democracy promotion" agenda in favor of "dignity promotion," to fix the conditions of misery that breed anti-Americanism and prevent liberty, justice, and prosperity from taking root. An inextricable part of that doctrine is a relentless and thorough destruction of al-Qaeda. Is this hawkish? Is this dovish? It's both and neither -- an overhaul not just of our foreign policy but of how we think about foreign policy. And it might just be the future of American global leadership.

***

When considering any presidential hopeful's foreign-policy promises, it's important to remember that what candidates say is, at best, an imperfect guide to their actions in office. What proves to be a more reliable indicator of presidential behavior is a candidate's roster of advisers. (If the press had paid better attention, the country would have seen through Bush's pitch about a humble foreign policy and realized that many of his advisers, including Paul Wolfowitz and Richard Perle, were conspiracy-minded warmongers.) Obama's foreign-policy advisers come from diverse backgrounds. They are former aides to Democratic mandarins like Tom Daschle and Lee Hamilton (Denis McDonough and Ben Rhodes, respectively); veterans of the Clinton administration's left flank (Tony Lake and Susan Rice); a human-rights advocate who helped write the Army's and Marine Corps' much-lauded counterinsurgency field manual (Sarah Sewall); a retired general who helped run the air war during the invasion of Iraq (Scott Gration); and a former journalist who revolutionized the study of U.S. foreign policy (Samantha Power). Yet they form a committed, intellectually coherent, and surprisingly united foreign-affairs team. (Shortly before this piece went to press, Power resigned from the campaign after making an intemperate remark to a reporter.)

They also share a formative experience with each other and with Obama. Each opposed the Iraq War at a time when doing so was derided by their colleagues, by journalists, and by the foreign-policy establishment. Each did so because they understood that the invasion and occupation ran counter to the goal of destroying al-Qaeda. And each bore the frustration of endless lectures on their lack of so-called seriousness from those who suffered from strategic myopia.

"There is a popular notion that Democrats have to try to appear like Republicans to pass some test on national security. The fact that that's still the case after Iraq is absurd," says one of Obama's closest advisers. "So you break from that orthodoxy and say 'I don't care if the Republicans attack me because I'm willing to meet with the leadership in Iran. We haven't for 25 years, and it's not gotten us anywhere.'"

Most of the members of Obama's foreign-policy team expressed frustration that they had taken a well-considered and seemingly anodyne position on Iraq and suffered for it. Obama had something similar happen to him in the spring and summer of 2007. He was attacked from the left and the right for saying three things that should not have been controversial: that if he had actionable intelligence on the whereabouts of al-Qaeda's leadership in Pakistan but no cooperation from the Pakistani government, he would take out the jihadists; that he wouldn't use nuclear weapons on terrorist training camps; and that he would be willing to meet with leaders of rogue states in his first year as president. "No one [of Obama's critics] had thought through the policy because that was the quote-unquote naïve and weak position, so they said it was a bad position to take," recalls Ben Rhodes, the adviser who writes Obama's foreign-policy speeches. "And it was a seminal moment, because Obama himself said, 'No, I'm right about this!'"

Instead of backing down, Obama asked his foreign-policy team to double down. Rhodes wrote a speech that Obama delivered at DePaul University on Oct. 2, which criticized the boundaries of acceptable discourse set by the same establishment that backed the war. "This election is about ending the Iraq War, but even more it's about moving beyond it. And we're not going to be safe in a world of unconventional threats with the same old conventional thinking that got us into Iraq," Obama said. One of his advisers, recalling the fallout from Obama's comments about pursuing al-Qaeda in Pakistan, says, "He takes policy positions that are a break from both rigid orthodoxy and the Bush administration. And everyone says it's a gaffe! That just encapsulates everything that's wrong about the foreign-policy debate in Washington and in Democratic politics."

The Obama foreign-policy team describes it as "the politics of fear," a phrase most advisers used unprompted in our conversations. "For a long time we've not seen much creative thinking from Dems on national security, because, out of fear, we want to be a little different from the Republicans but not too different, out of fear of being labeled weak or indecisive," another top adviser says. Identifying that fear as the accelerant of the Iraq War mind-set is the first step to a new and innovative foreign policy. John Kerry was not able to argue for fundamental change in foreign policy because he was consumed by that very political fear. Obama's admonition to Democrats is much like Pope John Paul II's to the Gdansk shipyard strikers -- first, be not afraid.

***

Like Obama, his defense advisers have supplemented their American views with the perspectives of outsiders. Gen. Scott Gration, a retired Air Force jet pilot, says hello to me over the phone in Swahili. He learned about the crushing misery of the world's poor by growing up in Congo, where his parents were missionaries. After the violence following Congolese independence in 1960, Gration had an experience few Americans ever will: He became a refugee. "We lost everything we owned, and what we took with us, they confiscated," he remembers.

Sarah Sewall, a Harvard professor and another of Obama's closest advisers, also knows about stepping outside of her comfort zone. A longtime human-rights advocate with the disarmament organization, the Council for a Livable World, Sewall found herself in 2005 and 2006 with an unlikely partner: Gen. David Petraeus. He and two colleagues were rewriting the Army and Marine field manual for counterinsurgency and wanted Sewall's input on how to create a more just, humane, and successful doctrine. For agreeing to help, she was attacked by some on the left. "Should a human-rights center at the nation's most prestigious university be collaborating with the top U.S. general in Iraq in designing the counterinsurgency doctrine behind the current military surge?" Tom Hayden wrote online in The Huffington Post.

Sewall's involvement may have lost her some influence within the academic left, but she has become a hero to the military's growing circle of counterinsurgency theorist-practitioners. "Her impact on the thinking about the war and the conduct of the wars in Iraq and Afghanistan has been significant and not without cost," says Army Lt. Col. John Nagl, one of the counterinsurgency community's luminaries. "She has shown, in my eyes, great moral courage. I think Senator Obama is listening to someone who has thought long and hard about the use of force and who understands the kinds of wars we're fighting today."

This ability to see the world from different perspectives informs what the Obama team hopes will replace the Iraq War mind-set: something they call dignity promotion. "I don't think anyone in the foreign-policy community has as much an appreciation of the value of dignity as Obama does," says Samantha Power, a former key aide and author of the groundbreaking study of U.S. foreign policy and genocide, A Problem From Hell. "Dignity is a way to unite a lot of different strands [of foreign-policy thinking]," she says. "If you start with that, it explains why it's not enough to spend $3 billion on refugee camps in Darfur, because the way those people are living is not the way they want to live. It's not a human way to live. It's graceless -- an affront to your sense of dignity."

During Bush's second term, a strange disconnect has arisen in liberal foreign-policy circles in response to the president's so-called "freedom agenda." Some liberals, like Matthew Yglesias in his book Heads In The Sand, note the insincerity of the administration's stated goal of exporting democracy. Bush, they observe, only targets for democratization countries that challenge American hegemony. Other liberal foreign-policy types, such as Thomas Carothers and Marina Ottaway of the Carnegie Endowment for International Peace, insist the administration is sincere but too focused on elections without supporting the civil-society institutions that sustain democracy. Still others, like Kenneth Roth of Human Rights Watch, contend that a focus on democracy in the developing world without privileging the protection of civil and political rights is a recipe for a dangerous illiberalism.

What's typically neglected in these arguments is the simple insight that democracy does not fill stomachs, alleviate malaria, or protect neighborhoods from marauding bands of militiamen. Democracy, in other words, is valuable to people insofar as it allows them first to meet their basic needs. It is much harder to provide that sense of dignity than to hold an election in Baghdad or Gaza and declare oneself shocked when illiberal forces triumph. "Look at why the baddies win these elections," Power says. "It's because [populations are] living in climates of fear." U.S. policy, she continues, should be "about meeting people where they're at. Their fears of going hungry, or of the thug on the street. That's the swamp that needs draining. If we're to compete with extremism, we have to be able to provide these things that we're not [providing]."

This is why, Obama's advisers argue, national security depends in large part on dignity promotion. Without it, the U.S. will never be able to destroy al-Qaeda. Extremists will forever be able to demagogue conditions of misery, making continued U.S. involvement in asymmetric warfare an increasingly counterproductive exercise -- because killing one terrorist creates five more in his place. "It's about attacking pools of potential terrorism around the globe," Gration says. "Look at Africa, with 900 million people, half of whom are under 18. I'm concerned that unless you start creating jobs and livelihoods we will have real big problems on our hands in ten to fifteen years."

Obama sees this as more than a global charity program; it is the anvil against which he can bring down the hammer on al-Qaeda. "He took many of the [counterinsurgency] principles -- the paradoxes, like how sometimes you're less secure the more force is used -- and looked at it from a more strategic perspective," Sewall says. "His policies deal with root causes but do not misconstrue root causes as a simple fix. He recognizes that you need to pursue a parallel anti-terrorism [course] in its traditional form along with this transformed approach to foreign policy." Not for nothing has Obama received private advice or public support from experts like former Clinton and Bush counterterrorism advisers Richard Clarke and Rand Beers, and John Brennan, the first chief of the National Counterterrorism Center.

The Obama foreign-affairs brain trust balks at the suggestion that what it's proposing is radical. "He said we'd take out al-Qaeda's senior leadership in the Pakistani tribal areas if Pakistan will not. That's not, to me, a revolutionary policy," Rhodes says. "Watching him get attacked on the right is absurd. You've got guys who argued for a massive invasion and occupation of a country that had nothing to do with 9-11 criticizing him for advocating the use of highly targeted force to kill Osama bin Laden!"

Rhodes is referring, of course, to John McCain, the presumptive Republican presidential nominee, who recently asked of Obama, "Will we risk the confused leadership of an inexperienced candidate who once suggested invading our ally, Pakistan?" It's no secret that McCain, a war hero who is to the right of Bush when it comes to Iraq, hopes to make this a foreign-policy election. Conventional wisdom holds this would give him an advantage over Obama. A Feb. 28 Pew Research Center poll found 43 percent of respondents believe Obama is "not tough enough" on foreign policy. Thirty-nine percent believe Obama's foreign policy is "just right," while 47 percent say the same of McCain.

Even so, Obama's foreign-policy advisers are thrilled at the prospect of facing McCain. Had the GOP nomination gone to Mitt Romney or Mike Huckabee, politicians who don't particularly care about foreign policy, an Obama victory would not provide a mandate for the sweeping foreign-affairs overhaul his campaign proposes. November's election could be, for the first time in a very long time, a choice between two radically different visions of U.S. global engagement. "We want to have this debate with John McCain," a close Obama adviser says. "[Obama] will offer this clear contrast."

Susan Rice, an assistant secretary of state in the Clinton administration and one of the few foreign-policy-establishment luminaries to sign on with Obama, explains what's at stake: "After eight years of George Bush, when the next president puts his or her hand on the Bible to be sworn in, the U.S. is going to get one brief second look [from the world] about whether the U.S. truly learned to change from its past mistakes, recent and historic, and whether we're again the kind of America people look to lead in a constructive fashion, or whether we're hopeless. In my opinion, they'll look at McCain and decide we're trapped in our old mistakes."

Of course, it remains to be seen how voters might look at an Obama-McCain race. "The important distinction will be, does Obama come across as saying he wants to make a break with the foreign policy of the last seven years, or does it sound like he'll take foreign policy in a fundamentally different direction than that of the last twenty, thirty, fifty years?" says Guy Molyneux, a Democratic pollster with Peter D. Hart Associates. Americans are eager to put the Bush doctrine behind them, Molyneux says, but there's a danger that voters will see Obama as a "young guy who's less experienced but sounds like he's taking off in a new direction."

***

In his focus on the importance of dignity in our policy toward the developing world, Obama sounds quite a bit like John F. Kennedy, who knitted together an argument for engagement with the "non-aligned" world and began the tradition of development assistance as a foreign-policy goal. However, Kennedy's basic foreign policy continued along the Cold War lines that had been laid down during the Truman administration.

Democratic presidential candidates since Kennedy have either downplayed foreign policy or simply argued for more competence in its execution, with two major exceptions: George McGovern in 1972 and Jimmy Carter in 1976. In the popular imagination, based on the "Come home, America" line from his nomination acceptance speech, McGovern pivoted from a striking critique of the immorality of the Vietnam War to an indictment of U.S. involvement abroad. But McGovern purposefully left this broad criticism out of most of his campaign. "I concentrated on Vietnam," McGovern says in a phone interview, "because I thought it would be difficult to sell a comprehensive rewriting of American foreign policy." Carter is a more ambiguous case. In the wake of Watergate, he made a full-spectrum argument against the Washington establishment. Rethinking foreign policy was a part of that, and his aide Hamilton Jordan remarked, "If, after the inauguration, you find Cy Vance as secretary of state and Zbigniew Brzezinski as head of national security, then I would say we failed." Both men, of course, received precisely those posts.

Obama is doing something braver with foreign policy than McGovern or Carter. Much, of course, could go wrong. Right-wing demagogues are already implying Obama is a Muslim terrorist. Conservatives are using Obama's argument about the inextricability of international prosperity and U.S. national security to portray him as a "post-American globalist." Jewish right-wingers in the U.S. have begun a smear campaign not just about Obama, but also about Power, as writers for Commentary and National Review have baselessly implied that she is an anti-Semite. Expect more of this for the duration of the primary season, and, if Obama wins, beyond.

If he wins in the general election, he will face a crush of foreign-policy problems so enormous that they risk overwhelming even the most competent, experienced national-security team. Iraq is, of course, a nightmare, and al-Qaeda is not just sitting still in its Pakistani safe haven. To propose rebooting U.S. foreign policy now is, to say the least, ambitious. Many military leaders consider Obama an unknown quantity. At a recent talk, Washington Post correspondent Thomas Ricks said that officers and soldiers serving in Iraq thought that McCain and Clinton would both pursue a foreign-policy commensurate with Bush's, but Obama left them puzzled. Once in office, Obama might feel compelled to turn his back on the critique he makes on the trail.

But while the doubts about Obama contain fair points, they also, to a certain degree, reflect a triumph of the Iraq War mind-set. Why not demand the destruction of al-Qaeda? Why not pursue the enlightened global leadership promised by liberal internationalism? Why not abandon fear? What is it we have to fear, exactly?

"He goes back to Roosevelt," Power says. "Freedom from fear and freedom from want. What if we actually offered that? What if we delivered that in the developing world? That would be a transformative agenda for us." The end of the Iraq War mind-set, it turns out, may be the beginning of America's reacquaintance with its best traditions.

Welfare for Wall Street

15 months ago, Goldman Sachs was handing out record-setting bonuses to its staff, the average at $622,000. In 2007, Lehman Brothers set a company record with a 27 percent increase in quarterly earnings. And Morgan Stanley reported profits of $2.58 billion in the second quarter of 2007. But now these and other big unregulated investment banks are in such dire straits due to their willfully risky exposure to sub-prime mortgages that they're eligible for government-subsidized loans at 2.5 percent interest.

Didn't these hugely profitable investment banks force themselves to save for a rainy day like the rest of us? WTF is going on here!? Talk about welfare! If only you and I were so big & important that the government wouldn't let us fail, not even for a few quarters just to teach us a lesson!

Bailing them out now just means they're going to do it again. (Moral hazard).


The Fed and Crony Capitalism
By Thomas I. Palley
March 31, 2008 | Prospect.org

In an attempt to stop the rot on Wall Street, the Federal Reserve recently granted special borrowing rights to Wall Street's largest investment banks. That decision smells of special dealing for special interests. The decision subsidizes these big powerful firms, thereby distorting financial markets in their favor. Behind the decision lies the problem of excessive representation of Wall Street interests within the Fed.

The Fed's response to the crisis, combined with its earlier massive policy failure to address the housing price bubble, raise grave questions about its independence and judgment. At this stage, Congress should launch formal hearings into the governance of the Fed, which has remained largely unchanged since the 1930s.

The subsidy to the big investment banks operates though the Fed's new Primary Dealer Credit Facility (PDCF) that gives investment banks who deal in government bonds access to cheap Fed funds. As a result, the chosen few can borrow money from the Fed at the bargain basement interest rate of 2.5 percent, and all that is asked is borrowers post some form of investment-grade collateral.

This arrangement constitutes a massive subsidy, which would be large in normal times. However, it is especially large at a time of market uncertainty and liquidity shortage. While other investors are being forced by the liquidity crisis to sell assets at fire-sale prices, the Fed's investment bank friends are being given near-free government money to snap up assets on the cheap.

Wall Street's investment banks have been quick to embrace the facility, and within four days borrowing reached $29 billion. Erin Callan, Chief Financial Officer of Lehman Brothers, enthusiastically declared the facility to be "incredibly attractive -- our ability to access that form of financing to do more business for clients is incredibly interesting."

Morgan Stanley Chief Financial Officer Colm Kelleher described the facility as being "there for normal business. It's not meant to be there as a last-recourse thing." A Goldman Sachs spokesman declared "we think the Fed window provides a good alternative to the secured funding markets and we welcome the initiative."

The new facility represents a complete break with the past. Previously, discount window borrowing from the Fed was restricted to regulated depository institutions, and access was always described as "a privilege and not a right." That meant deposit-taking banks could only get access to cover seasonal or unanticipated shortfalls of funds, and any borrowing had to be justified and was subject to regulatory disapproval -- so-called Federal Reserve 'frown' costs. Now, the Fed is apparently making loans available as a source of ordinary business finance for Wall Street's unregulated investment banks.

This means the Fed is providing risk capital to the likes of Goldman Sachs at paltry interest rates that confer on them a significant subsidy. Moreover, the mere right of access enables them to borrow more cheaply from other lenders because of the back-stop reassurance provided by discount window access. It also establishes incentives for future excessive risk-taking.

These subsidies are a travesty. Goldman Sachs, Lehman Brothers, and Morgan Stanley are extraordinarily profitable companies. They have also been the drivers of the worst trends in the American economy over the past generation, pushing excessive CEO pay that has spread like a cancer throughout corporate America, even reaching into universities and non-profits. Additionally, they have pedaled the shareholder value paradigm that has pushed companies to emphasize short-term gain over long-term investment, and contributed to ripping up America's social contract. Meanwhile, their business model has promoted speculation that is behind repeated asset and commodity price bubbles.

Subsidizing these firms is an insult to Main Street. Many families are losing their homes as part of the mortgage crisis. If they had access to 2.5 percent financing that would not be happening. Likewise, manufacturing firms are being forced to close because of lack of affordable capital, which is destroying jobs and the economic foundation of communities.

The Fed will claim it had to institute these measures to calm Wall Street. That is nonsense. The fair and economically efficient way for the Fed to deliver emergency liquidity to Wall Street is by an auction that is open to all financial firms, and in which participants supply good collateral. Those firms who need the funds most will bid the highest. That way, taxpayers get properly paid for their support, and the funds go to those who need them most.

Geologists say they learn the most from extreme events like earthquakes that reveal the reality of the earth's crust. For the past twenty-five years, critics of the Fed have been dismissed, and the Fed's high standing has blinded the reality of its revolving door with Wall Street and its class-based conduct of policy. Now, the Fed's response to Wall Street's panic has revealed the reality of its crony capitalist world. That provides an opening for long-needed reform.

Rare cracks in the MSM's Iraq narrative

An amazing dispatch for the "wherefore the Lib'rul Media?" file. Especially the interview transcripts of a clearly rattled Peter Jennings and two angry Iraqis on the eve of the U.S. invasion of Iraq. Foreboding, prescient, and ultimately tragic words.


What Can and Cannot Be Be Spoken on Television
By Glenn Greenwald
March 26, 2008 | Salon.com

Reich: Too big for moral hazard

The more I read about this the more upset I get. Meanwhile, notice how pleased the "free-market" Wall Street cheerleaders like Lawrence Kudlow have been about all of this Big Government meddling in the U.S. economy.

Moral Hazard
By Robert B. Reich
March 26, 2008 | Prospect.org

One day while sitting on a beach last summer I overheard a father tussle with his young son about whether the child was old enough to take out a small sailboat. The father finally relented. "Go ahead, but I'm not gonna save you," he said, picking up his newspaper. A while later, the sailboat tipped over and the child began yelling for help, but father didn't budge. When the kid sounded desperate I put down my book, walked over to the man, and delicately told him his son was in trouble. "That's okay," he said. "That boy's gonna learn a lesson he'll never forget." I walked down the beach to notify a lifeguard, who promptly went into action.

Letting children bear the consequences of their risky behavior – what some parents call "tough love" -- is equally applicable adults, and conservatives have made something of a fetish out of it.

Months ago, when the president announced a paltry plan to help out a few of the millions of homeowners who got caught in the sub-prime loan mess, he reiterated the credo: "It's not government's job to bail out ... those who made the decision to buy a home they knew they could not afford." Days ago, when he endorsed the giant Fed bailout of Wall Street, the president signaled it was government's job to bail out big bankers who had made decisions to buy and sell risky securities they knew (or should have known) they could not afford.

It's true that people tend to be less cautious when they know they'll be bailed out. Economists call this "moral hazard." But even when they're being reasonably careful, people cannot always assess risks accurately. Many of the mostly poor home buyers who got into trouble did NOT in fact know they couldn't afford the mortgage payments they were signing on to. The banks and mortgage lenders that pulled out all the stops to persuade them to the contrary were in a far better position to know; after all, they had lots of experience at this game. So did the credit-rating agencies that gave these loans solid credit ratings, as did the financiers who bundled them with less-risky loans and sold them to other financial institutions, and the hedge fund managers who quietly tucked them into their portfolios.

The real moral hazard in this saga started last summer when Fed Chair Ben Bernanke first cut the Fed's discount rate (charged on direct federal loans to banks) and announced that the Fed would take whatever action was needed to "promote the orderly financing of markets." Translated, this means that lenders, credit-rating agencies, financial intermediaries, and hedge funds would be bailed out, one way or another, because they're simply too big to fail. Since then, the Fed's Wall Street bailout has gotten bigger and bigger.

Note that behind every one of these institutions lie thousands of well-paid executives who would have lost big if the Fed didn't come to their rescue. A few, such as those at the late Bear Stearns, did lose big. But most executives on Wall Street have not. Even though they had more information and experience at risk-taking than the suckers who borrowed their money, and even though executives at the top of these institutions typically earn more in a day than the borrowers do in a year, moral hazard somehow doesn't apply to them.

When it comes to risky behavior in the market, America has a double standard. We're told that economic risk-taking as the key to entrepreneurial success. But when big entrepreneurs take big risks that fail it's amazing how often they get bailed out.

Indeed, the history of modern American business is littered with federal bailouts, loan guarantees, and no-questions-asked reorganizations. Some are well known, such as the Chrylser bailout of 1979, the savings and loan bailout of 1989, and the airline bailout of 2001. Most occur in the relative dark, such as the 1998 bailout of giant hedge fund Long-Term Capital Management (courtesy of former Fed chair Alan Greenspan), the not infrequent bailouts of under-funded corporate pension plans by the government's Pension Benefit Guarantee Corporation, price supports for big agribusinesses facing market downturns, or the current bailout of Wall Street being engineered by Ben Bernanke's Fed.

Behind every one of these bailouts are CEOs or financial executives who were rescued from their bad bets.

CEOs get away with stupid mistakes all the time. Some, like Robert Nardelli, the former CEO of Home Depot, drive their company's stock low that their boards eventually oust them. But they leave with eye-popping going-away presents nonetheless. (Nardelli got several hundrd million dollars on his departure.) If you're an average American who gets canned from his job, even through no fault of your own, you probably won't even get unemployment insurance (only 40 percent of job-losers qualify these days). Conservatives tell us that unemployment insurance reduces their incentive to find a new job quickly. In other words, moral hazard.

Some CEOs use bankruptcy as a means of getting out from under pesky labor contracts they might have "known they could not afford" when they agreed to them (Northwest Airlines most recently, for example). Others use it as a cushion against bad bets. Donald ("you're fired!") Trump's casino empire has gone into bankruptcy twice -- most recently, last November, when it listed $1.3 billion of liabilities and $1.5 million of assets – with no apparent diminution of the Donald's passion for risky, if not foolish, endeavor. After all, his personal fortune is protected behind a wall of limited liability, and he collects a nice salary from his casinos regardless. But if you're an ordinary person who has fallen on hard times, just try declaring bankruptcy to wipe the slate clean. A new law governing personal bankruptcy makes that route harder than ever. Its sponsors argued -- you guessed it -- moral hazard.

Bush's "ownership society" has proven a cruel farce for poor people who tried to become homeowners, and his minuscule response to their plight just another example of how conservatives use moral hazard to push their social-Darwinist morality. The little guys get tough love. The big guys get forgiveness.

Wal-Mart: Corporate welfare queen

The journalist quoted at length in this article, David Cay Johnston, is the author of the must-read book "Perfectly Legal."

Small Business Forced to Close by Gov't. Subsidies to Wal-Mart

By Sherwood Ross
March 25, 2008 | Political Affairs Magazine

Small retailers the nation over are being pushed out of business by government subsidies to chain competitors such as Wal-Mart and Target through a variety of "corporate socialism" schemes, taxation authority David Cay Johnston says.

Municipalities are permitting "tax increment financing" that allow the big chains "to keep the sales taxes that you are forced to pay at the tax register," Johnston said on the television interview program "Books of Our Time," sponsored by the Massachusetts School of Law at Andover and broadcast by Comcast.

"Instead of that money going to the schools and the fire department and the police department and the library, it is funneled through a mechanism of local government, usually a special authority, to finance the purchase of municipal bonds so that means that the wealthy underwriters and the lawyers and auditors all get a piece of this money to buy the land and build the store," Johnson told TV host Lawrence Velvel, dean of the law school.

The store is then leased to the big chain developer "at terms that amount to giving it to them for free or nearly free over a period of time," Johnston said, "and it's destroying local business." An amazing aspect of this "corporate socialism" policy, Johnston says, "is that local business owners have not risen up and stopped this."

"A system in which government, whether Federal or local, picks the winners in the economy, is not capitalism, it's not competition, it's not free market, it is corporate socialism, it is statism, it's the state making these choices," Johnston said.

In his new book, "Free Lunch" (Portfolio) Johnston amplifies this point by noting "Sam Walton practiced corporate socialism. As much as he could, he put the public's money to work for his benefit. Free land, long-term leases at below-market rates, pocketing sales taxes, even getting workers trained at government expense were among the ways Wal-Mart took every dollar of welfare it could get."

"Walton had a particular fondness for government-sponsored industrial revenue bonds," Johnston continued, "which cost him less in interest charges than the corporate bonds the market economy uses to raise money."

Johnston said in the television interview that if the public really understood what was happening they would not permit government subsidies to corporations to go forward.

Johnston pointed out: "Subsidies to retail cannot make us wealthier. Retail is at the end of the economic line. If you want to subsidize things, first subsidize education, then subsidize basic research, then subsidize applied research and development and subsidize infrastructure---rails and canals and highways---and maybe in some cases manufacturing and mining to get something going. But the least bang for the buck, and often the negative bang for the buck, would be subsidizing retail. What's happening is wealthy families, the richest families in America, are getting welfare and they apparently have no shame about this."

Johnston points out government handouts for Wal-Mart "reduce the costs of competing in the market" and by soliciting the subsidies "Wal-Mart shifted some of the risks of its expansion onto the majority of Americans who are not regular Wal-Mart shoppers."

He said the fortune Wal-Mart is reaping is no different from what other corporate players are getting. "We are transferring enormous amounts of money to corporations and wealthy individuals," Johnston pointed out. For example, he said, "We gave Warren Buffett's companies a hundred million dollar gift last year." (Buffett's firm has a two-thirds-billion-dollar, interest-free loan from our government for more than 28 year, Johnston notes. Similarly, Donald Trump benefits from a tax enacted to help the elderly and the poor but part of which is now diverted to his casinos, Johnston says.)

"The incomes of the top one percent are exploding, are pulling away from everybody else," Johnston said, "while the middle-class is stifling and the bottom is dropping out (of the economy)."

Author Johnson, for many years the tax reporter for The New York Times, has won a Pulitzer Prize and many other awards and uncovered so many tax dodges that he has been called the "de facto chief tax enforcement officer of the United States."

Taibbi: War denial sustains McCain, GOP

McCain Resurrected
By Matt Taibbi
March 2, 2008 | The Smirking Chimp

It's the day before the Virginia primary, and darkness has fallen outside the Aviation Museum in Richmond. Inside, presumptive Republican nominee John McCain stands proudly before a museum-exhibit version of his own A-4 Navy jet fighter, plowing through the Poconos-stand-up portion of his stump speech.

I've heard this shtick so many times by now that a kind of campaign echolalia has kicked in — I find myself involuntarily blurting out McCain's punch lines before he even starts a joke. At present, we're about two minutes shy of a prison joke that ends with The food was a lot better in here when you were governor!

I clench my teeth, bracing for impact. Behind me, a pair of aging Soccer Moms in acrylic sweaters sing McCain's praises. "I can't even imagine being a prisoner of war," says Mom Number One. "It must be so hard."

"Yeah," agrees Number Two. "You know he won't surrender over there."

"Mm-hmm," says the first. Then, after a pause: "Oh, hey, you know what I watched yesterday? Saving Private Ryan. And We Were Soldiers."

"Oh, those are great war movies," says Mom Number Two. "Great war movies."

Another pause. Then, "Oh, I went to that new buffet," says Mom Number One. "The one with the salads. I have to say, I'm not that into sweetbreads."

I want to choke the life out of both of them. But how do you communicate to someone the sheer insanity of voting to bomb the fuck out of some distant country while you sit safe and cozy in the Virginia suburbs, evaluating sweetbreads — just so the world can keep on feeling like the heroic war movies you rock yourself to sleep with on Sunday afternoons?

The answer is you can't. And that is one big reason why John McCain, defying the expectations of almost everyone who watched him last summer — myself included — has risen from the political dead to wrap up the GOP nomination. He's survived because Onward to Victory is the last great illusion the Republican Party has left to sell in this country, even to its own followers. They can't sell fiscal responsibility, they can't sell "values," they can't sell competence, they can't sell small government, they can't even sell the economy. All they have left to offer is this sad, dwindling, knee-jerk patriotism, a promise to keep selling world politics as a McHale's Navy rerun to a Middle America that wants nothing to do with realizing the world has changed since 1946.

The lesson of the McCain campaign is that one should never underestimate America's capacity for self-delusion. Balls-deep in one of the biggest foreign-policy catastrophes of all time, an arrogant military misadventure destined to make us infamous for a generation across a dozen cultures, minivan-driving suburban America is still waiting for Bill Holden to make it right by blowing up the Bridge on the River Kwai — and returning, tanned and handsome, to get the girl with a mouth full of cool one-liners.

I scoot away from the Moms, knowing I can't win any argument here. McCain, meanwhile, is wrapping up the tale of an old soldier who trained a monkey to take his place on the front lines during World War II.

"So I said to him, 'I can see why you weren't promoted,'" says McCain. "And he says, 'That's not what made me mad. The monkey retired as an admiral!'"

The audience roars with laughter. We'll lick this Iraq thing yet!

According to current political wisdom, John McCain is "controversial" among Republicans because he lacks true conservative credentials. His main offenses, ostensibly, are a smattering of domestic-policy positions that defy the GOP's Limbaugh-Hannity orthodoxy: He took a public stand against the Spanish Inquisition, he shared a room with Ted Kennedy for a few hours to fashion a failed immigration bill, he passed a roundly criticized campaign-finance-reform bill, he accidentally deemed the Bush tax cuts insane out loud before realizing that this was a political error.

From the battering that McCain is taking lately from the likes of Limbaugh and skanky bitch-whore Ann Coulter, who vowed to campaign for Hillary if McCain gets the nomination, one wouldn't know that most of his supposed crimes were actually based on conservative principles. His opposition to the tax cuts, for instance, was based on fiscal responsibility — i.e., a desire to avoid slashing revenues during a period of both high national debt and massive military spending ("I don't remember ever in the history of warfare when we cut taxes"). Only a Bush Republican would call insisting on actually having money before you spend it a lack of "true conservatism."

Even in McCain's ill-fated immigration initiative, which would have provided illegal residents with a path to citizenship, one can clearly see an essentially pragmatic, business-friendly nod to basic cultural and economic reality at work. Like George Bush himself, who tried for years to institute legal status for guest workers, McCain merely sought a means to legitimize the undocumented labor propping up American business. His real crime on immigration was saying things about Mexican illegals like, "These are God's children as well."

From torture ("Mistreatment of prisoners harms us more than our enemies") to the Dixie Chicks ("To restrain their trade because they exercised their right of free speech is remarkable"), McCain has repeatedly displayed an inability to connect with the bloodthirsty, emotional imperatives of the Limbaugh-Hannity line of thinking, in which all nuance and pragmatism must be dismissed in favor of an all-out crush-the-demon position. On some issues, in fact, McCain demonstrates a suspicious inclination toward actually solving the problem. This arrogant refusal to be a craven imbecile is what makes McCain suspect in the eyes of Limbaugh and Coulter, who are terrified at the prospect of a Republican president uninterested in book burnings.

Unfortunately, McCain has chosen to handle his conservative "problem" the way any self-respecting politician would: by changing his mind about everything he ever stood for. As I watch him campaign in Virginia and Maryland, it's hilarious to see him grit his teeth and try to work himself into applause lines like "The first thing we need to do is make the Bush tax cuts permanent!" He also mentions Ronald Reagan so often that his traveling press corps has to be getting ideas for a "Hi, Ron!" drinking game.

But for all his efforts to turn himself inside out for the mob, McCain still doesn't convince conservatives. In the politics of faith and emotion, you have to get it right the first time. "It bothers me," says Zack Skelton, a Huckabee supporter who came to see McCain in Virginia, when asked about McCain's change of heart on abortion rights. "Also, the issue of illegal immigration. I don't like that he had to change his mind."

To me, though, what's strangest of all is how irrelevant such positions seem when it comes to McCain. For all of his supposed unreliability in the domestic arena, McCain may be even more crazy than the Republican mainstream on the issue that matters most of all: the war in Iraq and war in general. My guess is that Republican voters are not going to mind that McCain's candidacy might drive a stake through the heart of the weenie fascism of Rush and Hannity, once they figure out that the candidate is a solid bet to deliver them World War III. And that should scare the shit out of us all.

Around the time McCain was rising from the dead to win the New Hampshire primary, the New England Journal of Medicine estimated that 151,000 Iraqis had been killed during the first three years of the U.S. occupation. In a campaign season, it should have been news that an authoritative study places the number of Iraqis who died because of America's war in the six-figure range. But it wasn't. Do a search on "New England Journal of Medicine" and "Iraq" on Google News and you get a mere 149 hits, most of which refer to another Journal study, about U.S. soldiers suffering from post-traumatic stress disorder.

Do a search on the phrase "surge is working," by contrast, and you get 430 hits. On the campaign trail, we hear every day that the surge is a success — an unchallenged bit of conventional wisdom that graduated to the level of cultural fact in the Los Angeles debate between Hillary and Obama, when Wolf Blitzer asked the candidates if a plan for withdrawal might mean that "all of that progress would be for naught."

An Iraqi might ask what progress we're risking, exactly, against the backdrop of 151,000 civilian deaths, but, hey, we're not Iraqi. We're American, and it's this American myopia that helped revive McCain's campaign. Back in the summer, when McCain boldly launched a "No Surrender" tour while all the other GOP candidates were fleeing the war issue like bitches, reporters thought the old man had finally gone senile. How else to explain a politician lashing himself to the mast of such an unpopular issue?

But McCain's entire career has been dedicated to the idea that America must always have the right to solve its problems by force. Throughout his political career, he has argued for increased use of force in virtually every military engagement the U.S. has been involved in since Vietnam. He complained about Bill Clinton's "excessively restricted air campaign" in Kosovo, campaigning strenuously for a ground invasion. During the 1994 flap over Pyongyang's nuclear program, he called for "more forceful, coercive action." Even before the latest Iraq War, McCain argued way back in 1999 that the only way to deal with Saddam Hussein was "to strike disproportionate to the provocation."

The most frightening example of McCain's fondness for force is on display in his own book, Faith of My Fathers, when he complains about the politicians who refused to allow pilots like him to attack, say, Soviet ships unloading arms in Vietnamese port cities. "We thought our civilian commanders were complete idiots," he writes.

Bombing Soviet ships, of course, would probably have started World War III, but McCain's vision, then and now, encompasses war as a way of life. There is significant evidence that McCain believes war is something righteous and necessary, a tonic for the national soul, intrinsically "noble" irrespective of context (he is still one of the only politicians to apply that word to the Iraq conflict). That is why it's no joke when McCain says casually, "There's gonna be other wars," or when he sings, "Bomb bomb bomb, bomb bomb Iran." We have to assume that he will jump at the chance to expand this conflict and hit those politically sensitive targets his "complete idiot" civilian commanders once barred him from going after in Vietnam.

Back in 1999, McCain concluded a speech at Phillips Exeter in New Hampshire by shouting, "Never again do we send our men and women to fight and die in foreign conflicts unless our goal is victory!" Which is interesting, because that is exactly — almost word for motherfucking word — how McCain ended his latest speeches on the campaign trail in Maryland and Virginia. In other words, John McCain knew his answer to the Iraq War mess before it even happened. For good measure, he insisted that "only military men like General Petraeus" have the right to say when soldiers will come home from Iraq — not, he added with a sneer, "some civilian running for president." Nor, presumably, America's civilian population, which is being asked to send its sons and daughters to kill and die in a faraway country.

No matter how moderate McCain seems on domestic issues, on the issue of war he's stark raving mad. He's a wounded, crusading Ahab, and civilian command and diplomatic restraint are his Great White Whale. If he gets put in charge of a Middle Eastern war that is easily widened, it's whirlpool time for all of us.

In a wider sense, McCain's candidacy is a referendum on America's fantastic self-image when it comes to our use of force. He is offering voters the chance to re-litigate these failures (both military and moral) in Vietnam and Iraq that muddle the cinematic happy ending. When I ask Sam Wilder, a sixty-eight-year-old veteran who supports McCain, if he thinks occupying Iraq is a good way to persuade Muslims not to attack us, he scoffs.

"We're not an occupying force," he says.

"How's that?" I ask. "We invaded the country and occupied it. We're ruling a foreign country by force. That's the definition. . . ."

"We're there training their force," Wilder says.

"But we're also there occupying the country," I say. "In an objective sense, we're occupying. A hundred thousand people are dead."

"Well," he says, "that wasn't the idea."

That idea — the principle of fighting first, thinking later and never, ever saying sorry — is what matters most to conservatives, and John McCain may be its last line of defense. If he fights hard enough to save it, you can bet that even Ann Coulter will come around to supporting him.

Socialized Bank Security

Socialized Compensation

New York Times Editorial
March 21, 2008

How can one feel sorry for James Cayne? The potential losses of the chairman and former chief executive of Bear Stearns must rank up there with the biggest in modern history. The value of his stake in Bear Stearns collapsed from about $1 billion a year ago to as little as $14 million at the price JPMorgan Chase offered for the teetering bank on Sunday.

Still, Mr. Cayne was paid some $40 million in cash between 2004 and 2006, the last year on record, as well as stocks and options. In the past few years, he has sold shares worth millions more. There should be financial accountability for the man who led Bear Stearns as it gorged on dubious subprime securities to boost its profits and share price, helping to set up one of the biggest financial collapses since the savings-and-loan crisis in the 1980s. Some might argue that he should have lost it all.

But that's not how it works. The ongoing bailout of the financial system by the Federal Reserve underscores the extent to which financial barons socialize the costs of private bets gone bad. Not a week goes by that the Fed doesn't inaugurate a new way to provide liquidity — meaning money — to the financial system. Bear Stearns isn't enormous. It doesn't take deposits from the public. Yet the Fed believed that letting it implode could unleash a domino effect among other banks, and the Fed provided a $30 billion guarantee for JPMorgan to snap it up.

Compared to the cold shoulder given to struggling homeowners, the cash and attention lavished by the government on the nation's financial titans provides telling insight into the priorities of the Bush administration. It's not simply a matter of fairness, though. The Fed is probably right to be doing all it can think of to avoid worse damage than the economy is already suffering. But if the objective is to encourage prudent banking and keep Wall Street's wizards from periodically driving financial markets over the cliff, it is imperative to devise a remuneration system for bankers that puts more of their skin in the game.

Financiers, of course, dispute that they are being insufficiently penalized. "I received no bonus for 2007, no severance pay, no golden parachute," E. Stanley O'Neal, the former chief executive of Merrill Lynch, told a House committee recently. That doesn't seem like much of a blow to Mr. O'Neal, who was removed earlier this year following gargantuan subprime-related losses.

Indeed, the pain that is being inflicted on financial-industry executives as a result of their own actions and decisions is not proving much of an encouragement. Rather, the knuckle-rapping seems only to encourage bankers to make up for any losses they may suffer by finding another way to navigate their companies, the financial system and the economy into the next maelstrom — from Internet stocks to what the industry calls zero-down, negative amortization, no-doc, adjustable-rate mortgages.

(Translation: derivatives based on incomprehensible mortgages with unpredictable interest rates given to people who have no reasonable chance of understanding them, let alone paying them back.)

Bankers operate under a system that provides stellar rewards when the investment strategies do well yet puts a floor on their losses when they go bad. They might have to forgo a bonus if investments turn sour. They might even be fired. Their equity might become worthless — or not, if the Fed feels it must step in. But as a rule, they won't have to return the money they made in the good days when they were making all the crazy bets that eventually took their banks down.

The costs of such a lopsided system of incentives are by now clear. Better regulation of mortgage markets would help avoid repeating current excesses. But more fundamental correctives are needed to curb financiers' appetite for walking a tightrope. Some economists have suggested making their remuneration contingent on the performance of their investments over several years — releasing their compensation gradually.

That's an idea worth studying. Certainly, trying to put specific limits on bankers' salaries is a nonstarter. But until bankers face a real risk of losing their shirts, they will continue blithely ratcheting up the risks to collect the rewards while letting the rest of us carry the bag when their punts go bad.

Pentagon: US occupation biggest lure for AQI foreign fighters

We already knew this, right?

Five Years Later

According to interviews with detained members of al-Qaeda in Iraq, the most powerful recruitment tool for Islamic extremists is ... the war itself.

By Spencer Ackerman
March 19, 2008 | Prospect.org

The Pentagon sponsored a conference call Monday with a Air Force colonel named Donald Bacon in Baghdad, who presented what he characterized as the findings of a major effort to understand al-Qaeda in Iraq (AQI), the United State's most implacable enemy in the war. These are the irreconcilables, the extremists, the bloodthirsty, the relentless; the ones who the president has promised will follow us home if they aren't defeated. The U.S. military command and the Bush administration have explained away AQI's tiny percentage within the Sunni insurgency by saying it is disproportionately dangerous, accounting for most of the suicide bombings and high-profile catastrophic attacks. And it's explained away the tiny proportion of foreigners within the mostly-Iraqi AQI by saying that the foreigners are both the organization's leadership and its suicide-bomber cadre.

So now the U.S. military command in Iraq has put together a new profile of the foreign cohort within AQI. It's based on debriefings of 48 foreign members of AQI currently in U.S. custody. In other words, Multinational Force-Iraq (MNF-I), the proper name for the U.S. military leadership, wanted to spread the word about what its most-implacable foe really is. Here is what that enemy looks like. I'll call him Mr. AQI.

Mr. AQI is a man in his early-to-mid 20s. Chances are he came to Iraq from either north Africa or Saudi Arabia. He's single. He's lower-middle class and has some high school experience, but probably not a diploma. To earn his wages he worked in construction or maybe drove a taxi. Mr. AQI probably didn't have any significant military experience prior to joining AQI. His relationship with his dad isn't so great. And while he's been religious for as long as he can remember, he wasn't, you know, a nut about it.

So what brought Mr. AQI to Iraq? At the mosque, he met a man who could tell Mr. AQI just wanted to belong to something. That man told Mr. AQI he had something Mr. AQI needed to see. Very often, according to Colonel Bacon, it was an image from Abu Ghraib. Or it was a spliced-together propaganda film of Americans killing or abusing Iraqis. The narrative that weighed heavily on Mr. AQI, Colonel Bacon said, was that it was his "religious duty go to Iraq," where he would serve as "an avenger of abused Iraqs."

But Iraq wasn't what he thought it would be. Mr. AQI wasn't an infantryman, where he'd bravely stand and fight Americans, he was pressured into being a suicide bomber. Nor were his targets the Americans he wanted to hit -- they were the Iraqis he came to avenge. According to Colonel Bacon, in some cases, Mr. AQI was happy to be in American custody, where he would no longer cause Iraq any more pain.

Let that sink in for a moment. For Mr. AQI has a lesson for us. Counterfactual conditionals are always problematic, but in all likelihood, according to MNF-I's own profile, if the United States were not in Iraq, Mr. AQI would be back in his taxi in Algiers or Jedda. Were it not for Abu Ghraib -- which, of course, never would have happened had we not invaded -- Mr. AQI would never have felt that it was his religious duty to kill Americans. And were it not for the war, thousands of Americans and possibly hundreds of thousands of Iraqis would be alive, right now, and all without a propaganda windfall that spikes terrorist recruitment for the extremist lurking around the mosque trying to generate new Mr. AQIs. And what is true of our foreign-born Mr. AQI is all the more true of the perhaps 95 percent of AQI that's Iraqi Sunni. Not one of them would have any reason to be a member of AQI if George Bush did not give him one.

I asked Colonel Bacon if Mr. AQI was an evildoer or if he was brainwashed; and then whether Mr. AQI would be blowing up Bangor if he wasn't blowing up Baghdad. Both were unfair questions, as they put a military officer into the crosshairs of an acrimonious debate that is properly debated by civilians. "No doubt some are more ideological than others," he told me, but his impression from the debriefings that they were primarily "looking for friendship, a place to be respected and counted. [That's] more of the driving force than anything else. And they're the most ideological [cohort] of AQI, more than the Iraqis." He added that "some could" come to the U.S. and "clearly al-Qaeda writ large would like to do that."

So I am sorry, Colonel Bacon. It wasn't right of me to ask those questions. But the evidence that you provided more than demonstrates that AQI is a nightmare of our own miscalculated creation. Imagine if we had not invaded Iraq but instead had devoted ourselves, five years ago to the promotion of dignity, justice and liberty to the millions of potential (and actual) Mr. AQIs around the greater Middle East. Mr. AQI desires to belong to something. He would have belonged -- not necessarily but quite possibly -- to the United States.

There are many horrors of the war, primarily the destroyed lives of Americans and Iraqis. But this is the strategic horror of the war. The good news is that there is a way to stop the generation of Mr. AQIs, both Iraqi and foreign. It is the most important counterterrorism operation of all. Stop this illegal, immoral, unjust, disastrous war.

A look at the 4,000 lost in Iraq

If you're moved only by dollars & cents, power politics, or geopolitical trends, then don't bother reading this. But if you really 'support our troops,' then take a moment to ponder these facts.


A look at lives lost as U.S. deaths in Iraq near 4,000
By Rick Hampson and Paul Overberg
March 21, 2008 | USA TODAY

One in six were too young to buy a beer. About two dozen were old enough for an AARP card. Eleven died on Thanksgiving Day, 11 on Christmas, and at least five on their birthdays. One percent were named Smith.

As the nation approaches its 4,000th Iraq war fatality — on Thursday the toll stood at 3,983 servicemembers plus eight Defense Department civilians — a USA TODAY analysis shows who gave their lives, where they came from and how they fell:

• Ninety-eight percent were male (compared with 99.9% of those lost in Vietnam). Three-quarters were non-Hispanic white (compared with 86% in Vietnam). The most common age was 21 (20 in Vietnam).

• Nine percent were officers, including 24 lieutenant colonels and six colonels.

• More of the fallen were based at Fort Hood in Texas than at any other military installation.

• New York City, which has lost 62 residents, had more deaths than any other hometown.

• More than half of the nearly 4,000 (52%) were killed by bombs, 16% by enemy gunfire. Five percent died in aircraft crashes. Fifty-five people drowned, and 15 were electrocuted. Almost one in five died from what the military terms "non-hostile" causes.

• Since the war began in March 2003, the Pentagon has reported double-digit U.S. fatalities on 35 days. The bloodiest was Jan. 26, 2005, when a Marine helicopter crashed in a sandstorm, killing all 31 aboard, and six other servicemembers died in combat. The bloodiest month was November 2004, when 137 died; the least bloody was February 2004, when 21 were lost. On 460 days of the war, no servicemember died.

HONORING THE FALLEN: Names mean more than numbers

INDEX: Who they were and how they died

The nearly 4,000 deaths — not including 482 troops killed in Afghanistan and the wider war on terrorism — are small by the standards of modern warfare.

The total is less than two-thirds the U.S. fatalities during the World War II battle of Iwo Jima, which lasted about a month; less than U.S. losses on each of the first three days of the Battle of the Bulge; and less than a fourth of U.S. fatalities in Vietnam in 1968 alone.

Is the upcoming 4,000th death more notable than the 3,999th or 4,001st? "Four thousand is a good round number people can grab hold of," says Morten Ender, a U.S. Military Academy sociologist who studies the military. "It reminds us of what's going on with a war that, since the (military's troop) surge, seems to have lost its place in the public mind."

Whether anyone pays attention to the benchmark is something else. "People tend not to be numerologists," says John Mueller, an Ohio State expert on war and public opinion. "These milestones basically have little effect on public support for a war. It's not like the stock market; people are more affected by events in wars than numbers."

[I'd call the 5th anniversary of a failed occupation that has killed 4,000 U.S. troops, will cost $2-3 trillion, has severely diminished our military' preparedness for a real war, and damaged America's international credibility for at least a generation an "event." -- J]

P.S. - The 4,000th U.S. soldier KIA was on Easter Sunday.

FOX anchors say network is 'Obama-bashing'

Be sure to check out the YouTube clips from FOX. Kudos to FOX's Kilmeade and Wallace for showing some integrity and standing up to their biased network!


Mayhem at FOX News: Anchor Walks Off Set, Wallace Rails Network for "Obama-Bashing"

March 21, 2008 | Huffington Post

Fox News' very own anchors are speaking out — and walking off — over what they perceive to be "Obama-bashing" on their network.

This morning on "Fox and Friends," Brian Kilmeade walked off the set after a dispute with his co-hosts Gretchen Carlson (she who celebrates deadly floods) and Steve Doocy over Obama's comment that his grandmother is a "typical white person." Kilmeade argued that the remark needed to be taken in context and eventually got so fed up with his co-hosts that he walked off set.

Later, "Fox News Sunday" host Chris Wallace came on the show and railed against "Fox and Friends" for what he called "Obama-bashing."

Update: Later that morning, Chris Wallace called into Brian Kilmeade's radio show to talk about the incident (apparently Steve Doocy was genuinely mad). Wallace also indicated that Fox execs might not have agreed with his position. You think? Find the audio here.

Gay-bashing 'Rapture' reverend endorsed McCain

Here is the real revered scandal: McCain actively sought and got the endorsement of televangelist and Rapture kook John Hagee, even though Hagee is a certified creep and nutjob. Will the lib'rul media make as much hay out of this scandal as they did with Rev. Wright? Place your bets!


Hagee, in 'NYT' This Sunday, Says McCain Sought His Endorsement
By Greg Mitchell
March 20, 2008 | Editor & Publisher


In an interview that will appear in this Sunday's New York Times Magazine, controversial televangelist Rev. John Hagee declares, "It's true that [John] McCain's campaign sought my endorsement."

McCain has attempted to distance himself from some of Hagee's views, much as Barack Obama is doing in relation to Rev. Jeremiah Wright. But unlike McCain, Obama has not stood on stage with Wright and accepted his accolades this year.

Interviewed by Deborah Solomon, Hagee refused to discuss his statement that Hurricane Katrina was God's punishment for a gay rights parade in New Orleans, calling it "so far off-base." He claims, "Our church is not hard against the gay people. Our church teaches what the bible teaches, that it is not a righteous lifestyle. But of course we must love even sinners."

He also said that charges that he had bashed the Catholic Church ("false cult system," etc.) have been "grossly mischaracterized....I was referring to those Christians who ignore the Gospels."

Asked what he thinks of Obama, he answers, "He is going to be difficult to beat, because the man is a master of communication. If he were in the ministry, he would make it in the major leagues overnight."

He also denies that he is a strong supporter of Israel because of any coming "Rapture" in the holy land.

Text of Obama's speech

We should vote for Obama, if only because he is the only public figure who could give this speech. Nobody else would have had the daring and the insight to explore the subtleties and contradictions of the enduring black-white divide in America -- and have done so with such a keen understanding of, and empathy for, all those well-intentioned folks on either side who want to reconcile but don't quite know how.

Indeed, if Obama believed that America was indelibly racist (as some are claiming to be Obama's secret conviction), then he would not have given this speech. He would not have even chosen to risk a run for the presidency in a racist, majority-white country. Because true racists would never be moved or persuaded, no matter how eloquent his words. To even attempt this campaign, much less this speech, must have required a genuine belief that America is ready to change for the better.

End of 'American exceptionalism'?

The End of the American Exception

Economically speaking, America could soon be more European than Europe

By Clive Crook
March 5, 2008 | TheAtlantic.com

That the United States stands apart is something Americans and Europeans have agreed on for a long time. It goes back to Tocqueville, like most things. Many of the differences of character and culture he noted in the first half of the 19th century are still there, no doubt, but some more recent contrasts are looking questionable. Since 1945, American exceptionalism has been asserted with particular confidence—but gradually diminishing validity—in economic affairs. America is to Europe as private enterprise is to the public good, as selfish individualism is to social partnership, as "compensation" is to work-life balance. Modern America has limited government, weak unions, high-powered incentives, capitalism red in tooth and claw. Post-war Europe has tax-and-spend, transport strikes, six-week vacations and the welfare state. Or so, on both sides of the Atlantic, we fondly imagine.

Living in the U.S. for several years after decades as a restless Brit, I continue to be struck by two things. First, this idea of rival economic paradigms appeals to both audiences: Neither would have it any other way. This may be why the notion persists so tenaciously, despite not being true. That is the second thing. Caricatures are well and good, but this one is just too much. In economic matters, America is far more like Europe, and Europe more like America, than either cares to admit. Moreover, the differences continue to shrink, and the pace of convergence seems about to accelerate. We will see whether the idea of America as the land of uncushioned capitalism—the timid and work-shy need not apply—will outlast a faster approach to the European norm.

The Democrats' promise of comprehensive health reform—something the country finally seems to want—is what prompts this line of thought. Over the past ten years, it seems, many Americans have come to think it wrong that a country as rich as theirs fails to guarantee access to health care. For much longer, almost all Europeans have thought it both incomprehensible and shameful. This is America's biggest social-policy exception (unless you count capital punishment as social policy). And it is marked for abolition.

Universal health care, if it happens, will be an enormous change in its own right, of course, but also one with further implications. It is going to push taxes up—in the end, possibly way up. The plans lately under discussion have not been properly costed, but figures of $50 billion to $75 billion a year in extra spending—the sorts of numbers bruited for the Democrats' proposals—are optimistic. Beyond the initial outlay, whatever that proves to be, is the likelihood that people will gradually migrate (at their own initiative, or more likely at their employers') from private insurance schemes to the new (and presumably subsidized) public alternatives. Everything depends on how the system is managed, but it is easy to foresee, in the fullness of time, a far bigger increase in the cost to taxpayers than the current plans envisage. And if American health care coverage and financing get more European, American taxes will have to as well.

"Europe" is a gross simplification, so think about Britain—which continental Europe regards as a mid-Atlantic offshoot of the United States—and, say, the Netherlands. U.S. taxes are 27 percent of national income, British taxes are 37 percent, and the Netherlands' are 39 percent. Recall that America spends fully 10 percentage points of national income more than Britain on health care, public and private combined. Suppose the bulk of the existing costs of U.S. health care eventually migrated to the public sector, and nothing else changed, American taxes would have to approach or exceed British and Dutch levels.

That is a worst-case scenario, no doubt, for believers in "vive la différence" And health spending, however important, is still only one category of social spending. America will continue to spend less on other social programs than is usual in Europe, you might think. In fact, the differences are exaggerated. Roughly speaking, Britain and the Netherlands spend about ten percentage points more of their national incomes on taxpayer-financed social spending. But if you allow for the higher taxes that Europeans pay on their benefits, and for cash-like tax reliefs that the United States freely uses to advance social goals, the difference shrinks by nearly half. This, to repeat, is before the Democrats' have done their health reform. And it is before they have taken up any of their other proposals to improve the country's safety net, through more comprehensive trade adjustment assistance and other kinds of help for displaced workers, or to expand other social programs.

If you look at other aspects of the American economic exception, you see something similar: Transatlantic differences have narrowed already, and the trend is more of the same. Consider regulation of business and finance. Few seem to question that the weight of regulation is less in the United States. In one area, anyway, this is true: Worker protections are weaker in America than in Western Europe, where employers are far less free to fire at will; and the floor that the minimum wage puts under incomes is lower here than there. But think about product-safety regulation, or environmental regulation. Think about the FDA. In many areas, America regulates its businesses at least as tightly as Europe.

In the 1980s, the Reagan administration did make a serious attempt to deregulate parts of the economy. Particular industries, notably banking and the airlines, were transformed. In other cases, such as the utilities, it was not so much a case of deregulating as replacing one scheme of regulation with another. But these were exceptions to an ongoing trend of regulatory accretion, and in some cases, accretion is putting it mildly. On regulation of corporate governance, Democrats are still calling for stricter rules—and given some of the recent abuses, not without reason. Yet, since Sarbanes Oxley, American financial and corporate regulation has been probably the most stringent and complex in the world. Personally, and I speak admittedly as a resident of the District of Columbia, I find the encompassing multi-jurisdictional tyranny of inspectors, officers, auditors, and issuers of licenses—petty bureaucracy in all its teeming proliferation—more oppressive in the United States than in Britain, something I never expected to say.

The unions are weaker here, it is said. To be sure, they have fewer members as a proportion of the workforce than in Britain, or (even more so) continental Europe. This is something else, of course, that the Democrats say they want to fix. Their proposed card-check legislation is expressly intended to slow and reverse the decline in union membership. This is a goal which few European governments would any longer think to embrace. In Britain it would be regarded as crazy, partly because Britain's unions, at the zenith of their power in the 1970s, before Margaret Thatcher, were keen to confront not just employers but elected governments as well.

Qualitatively, if not quantitatively, American unions remind me of the old-fashioned British kind. They seem anachronistically angry and assertive. Reform education? Impossible: the teachers' unions will not hear of it. Barack Obama is called brave merely for uttering the words "merit pay" in their presence. See what America's unions have done to the auto industry. The Writers' Guild just shut Hollywood down for several months. I cannot think of a British union that any longer has that kind of muscle, or would think of exerting it if it did. In much of the rest of Europe, unions have become a quietly co-operative part of management more than militant champions of workers' rights.

It would be wrong to say that the European idea has "won." Attitudes, it seems to me, remain an ocean apart: America still salutes effort, ambition, self-reliance and success in a way that is utterly unEuropean. And in recent years, remember, the distance between America and Europe has narrowed from both sides. Europe's governments have tried hard to cut taxes, spending and regulation. They have had only modest success, it is true; nonetheless, there has been movement toward "American-style capitalism", as it is still called. In the United States, the movement has been the other way—and with Democrats expecting, plausibly, to add the presidency to their control of Congress next year, there is more to come.

Could the lines even cross? Could America ever become more European than Europe? It seems unlikely, but not unthinkable. The Democrats, taken at their word (which would be rash), seem to be proposing exactly that. Elements, at least, of the programs outlined by Barack Obama and Hillary Clinton during their nomination contest are significantly to the left of where Britain's Labour Party, post-Thatcher, post-Blair, now stands. (Think about that.) But let us suppose, less adventurously, that American capitalism and Europe's social market merely continue to approach each other in the center. For good or ill, the era of the American economic exception is coming to an end.