Obama threatens a VETO - it's just posturing as his NDAA agenda was added to the defense budget and supported by congress which allows the indefinite detention of American Citizens without due process. This is unconstitutional and those in government who support it are traitors to America and it's Citizens and should be delt with as such under the guidelines of the United States Constitution.
(Reuters) – The Republican-led House of Representatives voted on Friday to authorize $642.5 billion in defense and war spending next year, defying a White House veto threat by exceeding President Barack Obama’s Pentagon funding request by several billion dollars.
The House, in a 299-120 vote on its annual defense policy bill, also affirmed that the president has the power to indefinitely detain suspected terrorists arrested in the United States and transfer them to military custody.
The House’s approval of the National Defense Authorization Act sets up a confrontation over defense spending and policy with the White House, which has warned of a presidential veto, and the Democratic-controlled Senate, which has not completed its version of the bill.
The measure authorized a base defense budget of $554 billion, including Pentagon spending and nuclear defense activities of the Energy Department. The House authorized $88.5 billion for the Afghanistan war and other overseas operations.
Representative Buck McKeon, chairman of the House Armed Services Committee, said the act imposed fiscal responsibility on the Pentagon while providing it with “the tools they need to win the war today and deter against the wars of tomorrow.”
His Democratic counterpart, Representative Adam Smith, endorsed the overall direction of the bill but said he was troubled by “overly confrontational language” in sections spelling out policies related to Russia, North Korea and Iran.
The measure calls for the United States to “take all necessary measures, including military action if required, to prevent Iran from threatening the United States, its allies or Iran’s neighbors with a nuclear weapon.”
An amendment passed on Friday tempered the language by saying nothing in the act should be construed as authorizing a use of force against Iran.
“On North Korea, the confrontational language went so far as to include a study that suggests deploying tactical nuclear weapons to the region,” Smith said. “This would be dangerous and reckless and could destabilize the entire region.”
ADDS TO DEFENSE SPENDING
The House measure would add some $4 billion to the Democratic president’s defense spending plan and delay or reverse many of the cuts in ships, aircraft and troop levels proposed as part of the Pentagon’s new military strategy.
The authorization bill lets Congress set defense policy and authorize spending limits but it does not actually appropriate funds. The panel that controls the purse strings – the House Appropriations Committee – this week approved slightly lower spending levels for defense.
The Pentagon is under orders to cut projected spending by $487 billion over the next decade as the government’s tries to bring its trillion-dollar deficit under control.
It could face an additional $500 billion in automatic spending cuts over 10 years beginning in January. The cuts were set in motion as part of last year’s debt limit deal, after a congressional panel failed to specify further deficit-reduction measures.
In debate on amendments to the bill, lawmakers clashed over efforts to revoke powers granted in the wake of the September 2001 attacks that let the president order the indefinite detention of suspected terrorists detained in the United States.
The issue split the conservative Tea Party movement, with some joining an attempt to revoke the presidential powers and others seeking to retain but clarify them.
Smith said the president should not have the power to indefinitely detain someone without being required to charge them and bring them to trial. He noted that the criminal justice system had effectively dealt with more than 400 terrorists.
“This is an extraordinary amount of power to give to the president,” he said. “One power that he does not need is the power to indefinitely detain or place in military custody people here in the United States.”
But most lawmakers warned that Smith’s proposal would force the president to treat terrorist suspects as criminals rather than enemy combatants.
“We are at a war, we are not in a police action,” said Representative Allen West, a member of the Tea Party caucus. “We cannot look to guarantee to those who would seek to harm us the constitutional rights that are granted to Americans.”
But Representative Justin Amash, another Tea Party favorite, said constitutional guarantees of due process were reserved for all people, not just U.S. citizens.
“The frightening thing here is that the government is claiming the power under the Afghanistan authorization for use of military force as a justification for entering American homes to grab people indefinitely detain them and not give them a charge and a trial,” he said.
By: David Alexander
(Additional reporting by Susan Cornwell; Editing by Xavier Briand)
Brazilian-born Saverin isn’t ducking anything. Anyone handing back a U.S. passport pays an exit tax on capital gains, including those that haven’t yet been crystallized by selling investments. His remaining Facebook stake, potentially worth several billion dollars, might have been valued at much less. But the Internal Revenue Service is nonetheless collecting hundreds of millions of dollars in taxes that Saverin might never have paid had he stayed a U.S. citizen and held onto the stock.
There’s outrage on Capitol Hill about one tangential aspect of Facebook’s initial public offering. U.S. Senators Chuck Schumer and Bob Casey object to co-founder Eduardo Saverin’s tax “duck” on his stake in the social network now that he has given up his U.S. citizenship. But becoming a non-American is expensive and complicated. Lawmakers might instead ask what they’re doing wrong for U.S. expatriates even to consider it.
Brazilian-born Saverin isn’t ducking anything. Anyone handing back a U.S. passport pays an exit tax on capital gains, including those that haven’t yet been crystallized by selling investments. His remaining Facebook stake, potentially worth several billion dollars, might have been valued at much less. But the Internal Revenue Service is nonetheless collecting hundreds of millions of dollars in taxes that Saverin might never have paid had he stayed a U.S. citizen and held onto the stock.
So giving up his citizenship wasn’t cheap. It’s also a lengthy, bureaucratic process. Now the senators also want the IRS to presume that anyone of significant means who no longer swears allegiance to the stars and stripes is avoiding taxes, charge them double the prevailing 15 percent rate on capital gains, and capture future gains, too. And they want to make sure no such person can ever enter the United States again.
In their zeal, Schumer and Casey are missing the bigger picture. First, while Saverin is privileged to have the option of giving up his U.S. nationality, his motivation almost surely stems partly from frustrations felt by most expats. Unusually, America taxes worldwide income of its citizens even if they live abroad. The compliance burden often makes it hard even to open a bank account. And the IRS makes reporting non-U.S. assets and income a nightmare.
Then there’s the effect on attracting citizens from elsewhere. Anecdotal evidence suggests that the complexity and imperialist tendencies of Uncle Sam’s tax system – more so than its rates – turn off potential immigrants. For every Saverin who offloads a U.S. passport (and last year’s tally, although a record, was only 1,780) there could be thousands more who don’t want to get mired in IRS red tape and choose to take their talents, future earning power and tax contributions elsewhere. That’s something really worth getting outraged about.
By: Richard Beales
President Obama leads likely Republican presidential nominee Mitt Romney by seven points in the latest Reuters/Ipsos poll but the numbers show voters are almost evenly divided over who is better equipped to create jobs and boost the economy. Andy Sullivan reports.
She has appeared on TV and written defiant opinion articles, saying that Democrats are accusing Republicans of being anti-women because the Democrats do not want to discuss President Barack Obama's handling of the economy and the federal debt.
(Reuters) – In the last three weeks, she has sparred on national television with Democrats over Republican policies toward women, been called a “lying mouthpiece” by a liberal blog, and chided former House speaker Nancy Pelosi.
In the world of conservative politics, Republican Representative Cathy McMorris Rodgers has arrived.
McMorris Rodgers has represented Washington state in the U.S. House of Representatives since 2005 but spent much of that time in relative obscurity, even while rising in 2009 to become the only woman among the senior Republican leadership in Congress.
That low-profile was raised in March, with three words that still make McMorris Rodgers cringe: “War on women.”
It is the phrase Democrats began using to cast Republicans as insensitive on issues such as equal pay for women, healthcare, protection against domestic abuse and abortion rights.
For McMorris Rodgers, 42, it was a call to action at a time when her male colleagues seemed reluctant to fire back at Democrats.
“I felt compelled to stand up and try to counter this myth” of a Republican “war on women,” said McMorris Rodgers, vice chair of the 242-member Republican conference in the House.
In recent months she has become one of her party’s chief counter-punchers to criticism from Democrats.
She has appeared on TV and written defiant opinion articles, saying that Democrats are accusing Republicans of being anti-women because the Democrats do not want to discuss President Barack Obama’s handling of the economy and the federal debt.
A PRO-BUSINESS APPROACH
Such arguments might be helping Mitt Romney, the likely Republican nominee to face Obama in the November 6 election.
For months, polls showed Obama with a significant lead over Romney among women, but recent surveys have shown the gap closing. One poll – the CBS/New York Times survey – recently showed Romney with a slight lead among women.
A focus on free-market enterprise runs through McMorris Rodgers’ conservative voting record, which she says reflects her stance that all women, like men, are better served when businesses can flourish without being too burdened by government.
That is how she justifies votes that draw her the most criticism from Democrats, such as her opposition to a 2009 bill that made it easier for women to sue for pay discrimination.
The law, one of the signature legislative achievements of Obama’s administration, was known as the “Lilly Ledbetter Law,” after a Goodyear Tire & Rubber Co worker who had lost her claim of pay discrimination before the Supreme Court because she waited too long to sue. The law loosened the statute of limitations for such lawsuits.
“First off, Republicans believe in equal pay for equal work,” McMorris Rodgers said. “But in 2009, Democrats didn’t bother to work with Republicans on this or other issues, and passed a bill that’s a trial lawyer’s dream. All it does is open the door to more lawsuits and make it harder for job creation.”
Seated in her office across the street from the U.S. Capitol, McMorris Rodgers added in an interview, “The Republican Party is the party of equal opportunity.”
On display are framed photos of her family: Cole, 5, Grace, 1, and her husband, Brian, a retired Navy commander who now works at home.
“My husband has a new appreciation for stay-at-home parents,” McMorris Rodgers said. “Lots of work.”
TAKING HEAT
On Wednesday, McMorris Rodgers was at center stage of a dispute between the Republican-led House and the Democratic-led Senate over the renewal of the 1994 Violence Against Women Act, a law aimed at tackling domestic abuse.
McMorris Rodgers is a co-sponsor of a House bill to reauthorize the law. Her measure does not have the specific safeguards for gays, illegal immigrants and Native Americans that are in the Senate version.
Hundreds of advocacy groups call the House bill inadequate and warn it would weaken the 1994 law. The White House backs the Senate-passed version and threatens to veto the House bill.
McMorris Rodgers brushed off objections and urged colleagues to show “support for their mothers, wives, daughters, neighbors and friends” by voting for the House measure, which passed her chamber on a mostly party-line vote.
Two days before the House vote, McMorris Rodgers faced a grilling on MSNBC’s “Hardball with Chris Matthews” about the House bill’s lack of coverage for women in same-sex relationships, a particularly hot topic since Obama declared his support for gay marriages last week.
McMorris Rodgers briefly searched for the right words, then told Matthews that “there’s nothing under federal law that currently recognizes same-sex couples.”
“But you’re a congresswoman. You write the law,” said Matthews, a top aide to Democratic House speaker Tip O’Neill in the 1980s who went on to become a journalist and TV commentator.
The liberal blog Daily Kos later posted a story on the encounter with a headline that said: “Matthews rattles lying mouthpiece McMorris Rodgers.”
STRIKING BACK AT PELOSI
While McMorris Rodgers has learned to take such criticism, she’s also become adept at dishing it out to Democratic leaders – including Pelosi, who was the first woman to serve as House speaker before her party lost control of the chamber in the 2010 elections.
Pelosi is among the Democrats who have accused Republicans of waging a legislative war on women. Democrats have criticized efforts by Republican-led state legislatures to impose new limits on abortion and Republican drives in Congress to cut health programs for women.
Democrats also have denounced Republicans’ calls to eliminate federal aid to Planned Parenthood, a private group that provides healthcare services to women, in addition to abortions.
They pointedly noted that House Republicans held a hearing in February on insurance coverage of birth control that featured an all-male panel.
“Where are the women?” Pelosi asked then.
In a recent appearance on NBC’s “Meet the Press,” McMorris Rodgers fired back at Pelosi: “It could be argued that it was the American women that really voted out, fired, the first woman speaker of the House.”
A senior Democratic aide offered a mixed review of the top Republican woman in Congress.
“She’s a disciplined, intelligent and engaging messenger,” the aide said. “The problem is her rhetoric” of wanting to help women “doesn’t match Republican policy making.”
McMorris Rodgers said she is determined to court women to support the Republican Party – and Mitt Romney’s bid for president – by talking about pocketbook issues such as jobs and healthcare.
That includes eliminating Obama’s healthcare overhaul, which she says is too expensive and hurts small businesses.
“Republicans who only talk about finances are not going to attract women voters,” McMorris Rodgers said. “Let’s talk about healthcare choices … families, raising children and trying to find a job in a tough economy. These are women’s issues and Republican issues for 2012.”
By: Thomas Ferraro
(Editing by David Lindsey and Jackie Frank)
Special Assistant Joshua Wisch said late Friday that Arizona Secretary of State Ken Bennett hasn’t done that despite numerous email and phone exchanges between their offices.
Wisch says Hawaii state laws require Bennett to show legal authority that this office needs the records to update its official lists as part of its ordinary work.
Wisch says as soon as Bennett gives Hawaii adequate authority, the Aloha State will verify Obama’s birth.
Bennett said in a radio interview this week that Obama’s status on Arizona’s ballot is in question unless Hawaii verifies his birthplace.
Hawaii officials have confirmed multiple times that Obama was born there.
The Supreme Court’s 2010-2011 term favored big business over the interests of consumers and employees and continued to lean toward an expansive view of the First Amendment. A look at key cases, which justices agreed most — or least — frequently, and who was most likely to be in the High Court’s majority.
Wal-Mart
v. Dukes 
In ruling in favor of Wal-Mart, the court blocked the nation’s largest-ever sex discrimination case. As many as 1.5 million current and former female workers could have been included in the class suing Wal-Mart, and the company faced the possibility of owing billions of dollars in back pay. But the court’s conservatives said the women had not proved they had suffered from a common policy of discrimination. The decision raises significant hurdles for other class-action suits brought against big corporations.
Majority
Anthony Kennedy
John Roberts (chief)
Samuel Alito
Stephen Breyer
Ruth Bader Ginsburg
Sonia Sotomayor
Antonin Scalia
Clarence Thomas
Elena Kagan
Ashcroft
v. Al-Kidd
The court ruled unanimously that former attorney general John D. Ashcroft cannot be sued personally for allegedly misusing his power to detain an American Muslim in the post-Sept. 11, 2001, crackdown on suspected terrorists. But the decision exposed sharp differences among the justices about whether the government went too far when it used a statute meant to ensure that witnesses show up for trial. Justice Elena Kagan sat out the case because she had worked on Ashcroft’s behalf as President Obama’s solicitor general.
Majority
- Anthony Kennedy
- John Roberts (chief)
- Samuel Alito
- Stephen Breyer
- Ruth Bader Ginsburg
- Sonia Sotomayor
- Antonin Scalia
- Clarence Thomas
Dissent
- *Justice Elena Kagan recused herself from this case.
American Electric Power
v. Connecticut
The Supreme Court unanimously shut down a huge global-warming lawsuit in which states asked the federal courts to regulate polluting power plants. The justices said that is a job for the Environmental Protection Agency. Writing for her colleagues, Justice Ruth Bader Ginsburg said Congress in the Clean Air Act gave responsibility for curbing carbon dioxide emissions to the EPA. Ginsburg said the states and groups may challenge the EPA’s actions, but a national policy was better than limits set by individual federal judges.
Majority
- Anthony Kennedy
- John Roberts (chief)
- Samuel Alito
- Stephen Breyer
- Ruth Bader Ginsburg
- Sonia Sotomayor
- Antonin Scalia
- Clarence Thomas
Dissent
- *Justice Elena Kagan recused herself from this case.
Snyder
v. Phelps
The court’s most liberal and most conservative justices joined in ruling that the First Amendment protects a fringe church’s anti-gay protests at military funerals. The decision writes a new chapter in the court’s findings that freedom of speech is so central to the nation that it protects cruel and unpopular protests, even at the moment of a family’s most profound grief.
Majority
- Anthony Kennedy
- John Roberts (chief)
- Elena Kagan
- Stephen Breyer
- Ruth Bader Ginsburg
- Sonia Sotomayor
- Antonin Scalia
- Clarence Thomas
Dissent
- Samuel Alito
Brown
v. Entertainment Merchants Assn.
The Supreme Court ended its term by striking as unconstitutional California’s attempt to ban the sale of violent video games to minors. By a 7-2 vote, the court upheld a lower court’s decision that California’s attempt to impose a $1,000 fine on those who sell or rent violent video games to minors violated free speech rights.
Majority
- Anthony Kennedy
- John Roberts (chief)
- Samuel Alito
- Antonin Scalia
- Elena Kagan
- Ruth Bader Ginsburg
- Sonia Sotomayor
Dissent
- Stephen Breyer
- Clarence Thomas
Skinner
v. Switzer
In ruling in favor of Texas death row inmate Henry Skinner, who maintained that he did not kill his girlfriend and her two sons, the court opened a legal avenue for prisoners to try to gain access to DNA evidence that might prove their innocence.
Majority
- Antonin Scalia
- John Roberts (chief)
- Ruth Bader Ginsburg
- Elena Kagan
- Sonia Sotomayor
- Stephen Breyer
Dissent
- Samuel Alito
- Anthony Kennedy
- Clarence Thomas
Brown
v. Plata
A divided court ordered California to reduce its overcrowded prisons by more than 30,000 prisoners, saying judges must get involved when prison conditions are “incompatible with the concept of human dignity.” Against the backdrop of an exploding national prison population, the court upheld a lower court panel’s findings that California’s prison conditions violate the Constitution’s protection against cruel and unusual punishment.
Majority
- Anthony Kennedy
- Stephen Breyer
- Ruth Bader Ginsburg
- Elena Kagan
- Sonia Sotomayor
Dissent
- Samuel Alito
- John Roberts (chief)
- Antonin Scalia
- Clarence Thomas
J.D.B.
v. North Carolina
In a 5 to 4 split, the court ruled that police must be sensitive to the age of child suspects when deciding whether to inform them of their Miranda right against self-incrimination. Justice Sonia Sotomayor, writing for the majority, said the ruling was a “commonsense” application of the court’s previous findings that children are not “miniature adults” and should be treated differently. But dissenting conservative justices said that the majority was “embarking on a new expansion” of suspects’ rights.
Majority
- Anthony Kennedy
- Stephen Breyer
- Ruth Bader Ginsburg
- Elena Kagan
- Sonia Sotomayor
Dissent
- Samuel Alito
- John Roberts (chief)
- Antonin Scalia
- Clarence Thomas
Connick
v. Thompson
In the first decision of the term that split the justices into ideological camps, the court stripped a $14 million award from a wrongfully convicted man who had spent 14 years on death row and successfully sued New Orleans prosecutors for misconduct. Conservative justices prevailed in the ruling, which shielded the district attorney’s office from liability for not turning over evidence that showed John Thompson’s innocence. Justice Clarence Thomas said Thompson could not show a pattern of “deliberate indifference” on the part of former district attorney Harry Connick Sr., the father of the famous singer of the same name, in training his staff to turn over evidence to the defense team.
Majority
- Anthony Kennedy
- John Roberts (chief)
- Samuel Alito
- Antonin Scalia
- Clarence Thomas
Dissent
- Stephen Breyer
- Ruth Bader Ginsburg
- Sonia Sotomayor
- Elena Kagan
Arizona Christian School Tuition Org.
v. Winn
In throwing out a lawsuit against an Arizona tax-credit program that helps private schools, the Supreme Court made it harder for taxpayers to bring court challenges of government programs that aid religious organizations. The decision split the court along ideological lines and prompted the first written dissent by Justice Elena Kagan. She criticized the court’s majority and the Obama administration, in which she previously served, for its arguments on Arizona’s behalf.
Majority
- Anthony Kennedy
- John Roberts (chief)
- Samuel Alito
- Antonin Scalia
- Clarence Thomas
Dissent
- Stephen Breyer
- Ruth Bader Ginsburg
- Sonia Sotomayor
- Elena Kagan
Arizona Free Enterprise
v. Bennett
In the latest decision that the right of political speech trumps government’s attempts to restrain the power of money in elections, the court rejected Arizona’s system of providing “matching funds” to candidates who face big-spending opponents or opposition groups. The court said the law acts to discourage candidates and independent political organizations from spending money to further their political speech.
Majority
- Anthony Kennedy
- John Roberts (chief)
- Samuel Alito
- Antonin Scalia
- Clarence Thomas
Dissent
- Stephen Breyer
- Ruth Bader Ginsburg
- Sonia Sotomayor
- Elena Kagan
Chamber of Commerce
v. Whiting
In a 5 to 3 vote, the court ruled that Arizona may revoke the business licenses of companies that knowingly employ undocumented workers. The court rejected arguments that control over illegal immigration is solely a federal responsibility and endorsed narrowly drawn state efforts to regulate the employment of those in the country illegally.
Majority
- Anthony Kennedy
- John Roberts (chief)
- Samuel Alito
- Antonin Scalia
- Clarence Thomas
Dissent
- Stephen Breyer
- Ruth Bader Ginsburg
- Sonia Sotomayor
- *Justice Elena Kagan recused herself from this case.
President Obama’s reelection campaign launched a national drive Friday to counter new restrictive voter-access laws, which advisers said threaten his electoral chances in November.
Organizers will fan out in key swing states this weekend to teach volunteers and voters how to navigate a series of laws passed by Republican-controlled state legislatures imposing stricter identification requirements, limiting early voting and making it harder to organize voter-registration drives.
The Obama campaign’s “weekend of action” is part of a field effort that in 2008 helped identify, register and turn out millions of new voters.
It is the beginning of a months-long effort, campaign officials said, to combat what they described as a Republican effort to stifle voting among young people and minorities, two groups that traditionally tend to vote Democratic.
Republicans say the new laws are needed to protect against voter fraud and help make elections fairer.
The Obama campaign’s “weekend of action” is part of a field effort that in 2008 helped identify, register and turn out millions of new voters. Those new voters gave Obama wins in unlikely places, including North Carolina and Virginia, where young and minority voters helped make the difference. Turning out those voters again this year is key to the president’s reelection strategy, but it is also more challenging this year in part because of the new voting laws.
“Over the past century, we expanded this fundamental right, making sure no one’s race, gender or economic status is ever used to deny this fundamental right,” said campaign strategist Michael Blake in a call with reporters Friday afternoon.
“Unfortunately,” he added, “Republican-controlled legislatures in many states have been taking us backward, not forward.”
In 2011, more than 30 states debated changes to their voting laws. A dozen passed more restrictive rules requiring voters to present state-issued photo IDs, according to the National Conference of State Legislatures, although Democratic governors in four states vetoed them. Florida and Ohio cut the number of days for early voting by nearly half, and Florida lawmakers reversed rules that had made it easier for former felons to vote.
On Friday, Virginia Gov. Robert F. McDonnell (R) signed the latest — a new voter-ID bill. Virginia already required voters to present valid identification at the polls, but those who didn’t have it were allowed to sign an affidavit pledging that they were who they said they were. Now, voters can present a wider range of valid identifications, but the affidavit option is gone, and voters without legal identification must vote provisionally and prove later that their vote should count.
Republicans in several states have said the new laws are necessary to prevent voter fraud and make elections fairer. In a statement Friday, McDonnell praised his state’s new law for “helping to further prevent voter fraud and ensuring Virginians that they can have faith that votes have not been fraudulently cast.”
But as governor of a critical swing state with a large swath of moderate voters, McDonnell is cognizant of the possibility that the law may be seen as a vehicle for voter suppression. Earlier this year, he unsuccessfully lobbied fellow Republicans in the legislature to allow for a signature comparison for voters with no ID. And on Friday, he issued an executive order calling on the state elections board to issue a registration ID to all voters so that “on election day this year, every Virginia voter will have at least one valid ID.”
Voting rights groups and Democrats, meanwhile, have decried these measures as deliberate attempts to suppress voters and swing elections. They say there have been few cases of voter fraud, given the millions of ballots cast and compared to the high number of poor and minority voters who will be affected. Some of these groups have brought lawsuits against some of the new legislation.
Twenty-five percent of African American voters do not have a valid government-issued photo ID, compared with 8 percent of whites, according to a study by the Brennan Center for Justice at New York University’s law school. The report also found that 15 percent of voters earning less than $35,000 per year do not have such an ID.
According to Project Vote, a voting-rights advocacy group, about 15,000 people voted without identification in Virginia in 2008.
A centerpiece of Obama’s new effort is a Web site, www.gottavote.org, that helps voters register and understand the voting requirements in their state. The site — and its Spanish-language version, votemostodos.org — also urges viewers to sign up to volunteer and solicits lawyers to help with voter-protection efforts.
The campaign will hold hundreds of events in key battlegrounds Saturday and Sunday. In the Washington region, mostly in the Virginia suburbs, there were 38 voter-registration events scheduled between Friday and Sunday.
A particular emphasis will be placed on training volunteers who will be deployed through the summer and fall to continue the education and registration effort directly with voters.
By: Amy Gardner
Staff writer Krissah Thompson contributed to this report.
The former Massachusetts governor is rising in the polls, including a Gallup survey this week that showed 50 percent of Americans now have a favorable opinion of him, the highest yet.
(Reuters) – Is Mitt Romney an out-of-touch elitist and bully who led a rapacious business that killed common folks’ jobs?
That portrayal of the presumptive Republican presidential candidate is the most frequent one painted by President Barack Obama’s campaign and its allies, but their line of attack has yet to hit home.
The former Massachusetts governor is rising in the polls, including a Gallup survey this week that showed 50 percent of Americans now have a favorable opinion of him, the highest yet.
Part of that may be due to a honeymoon effect for Romney as Republicans rally now that he has effectively clinched the party’s nomination.
It could also be a sign that Democrats’ attacks on him for cutting blue-collar jobs when he was head of the Bain Capital private equity firm have not resonated with voters as much as they had hoped.
“To some extent, Romney’s been inoculated against them,” said Republican strategist Matt Mackowiak.
A Fox News poll this week that showed Obama leading Romney overall nevertheless put the Republican ahead on handling of the U.S. economy and creating new jobs.
For three straight days this week the Obama campaign, its Super PAC group, and Vice President Joe Biden attacked Romney’s jobs record at Bain, focused on the company’s closure of a Kansas City steel mill it had acquired.
Bain acquired Worldwide Grinding Systems, a steel mill in operation since 1888, in 1993. A decade later, the bankrupt mill was padlocked and some 750 people lost their jobs. Workers were not given the severance pay or health insurance they’d been promised and their pension benefits were cut.
The Democrats’ strategy is to strike at the heart of Romney’s campaign: his message that business experience makes him better placed than Obama to bring down the jobless rate.
Attacks like those may begin to take a toll on Romney but, for the moment, he is withstanding them.
“I think these become less effective as you continue to pound away at them. If you trot out 1,000 people who may have lost their jobs in a situation where (Bain) were trying to make a company profitable, does that 1,001st person have as much of an impact as the first?” Mackowiak said.
SIX-MONTH STRATEGY
Romney’s campaign was quick to reply to a video from the Obama re-election team on the Kansas City mill, releasing a clip of its own within hours that featured another steel plant that had succeeded with Bain’s help.
Romney has learned from failed campaigns for a Senate seat in 1994 and the Republican presidential nomination in 2008 that he will hear about Bain from critics.
“This line of attack happened in ’94,” said a senior Romney adviser. “It happened in ’08 and this line of attack happened a few months ago. If we weren’t ready for this line of attack I would say probably someone should be shot for malfeasance. Everyone knew it was coming.”
The Democrats’ aim is to build a narrative to define Romney as an elitist over the next six months not just a few weeks, said Rodell Mollineau, president of American Bridge 21st Century, a pro-Democratic research group.
“If you are just yelling that one time, then it gets lost through all the noise. It’s a whisper in the wind,” he said. “But if you find ways over and over and over again through different messages, tactics, press conferences … whatever means you can find, then that criticism’s going to grab hold.”
Romney’s bump in the polls – led by a CBS News/New York Times survey that had him ahead of Obama by three points – could be a temporary surge as Republicans climb on board his campaign after his main opponents in the party dropped out of the primary race in recent weeks.
“The spike in Romney’s favorable rating … is predictable, given that he has become the presumptive Republican nominee,” wrote Jeffrey M. Jones of Gallup. “Presidential candidates typically get a spike in their favorable ratings in the wake of winning the nomination.”
Obama still leads Romney on Gallup’s favorability rating by 52 percent to 50 percent, although the two men are tied in a matchup over who would make the best president.
BAIN STRATEGY COULD BACKFIRE
Romney is struggling to stay on his economic message, as Obama has dominated the news cycle since the general election contest started two weeks ago, visiting Afghanistan on the anniversary of Osama bin Laden’s killing and making a landmark announcement of support for gay marriage.
He said the Obama campaign was using the Bain criticism to mount a “character assassination” of him.
“My effort at Bain Capital as you know was in every case designed to try and make the enterprises that we invested in more successful,” he said in Florida on Thursday.
“And the purpose of the president’s ads are not to describe success and failure but somehow suggest that I’m not a good person, not a good guy, and I think the American people will know better than that, if they don’t know already,” he said.
The Bain strategy has a familiar ring to it for those who already tried to tar Romney with the issue and failed.
Fellow Republican Newt Gingrich, whose supporters put out a 28-minute video during the South Carolina primary in January depicting Romney as a corporate raider, regretted the attacks, said Gingrich senior adviser Bob Walker.
“We wanted to emphasize Newt’s strong credentials as the best candidate to beat Obama and emphasize the economy,” Walker said. “We ended up doing three or four days discussing Bain. I would actually contend it was harmful to us.”
Gingrich won in South Carolina, but was trounced by Romney in Florida a week later, and Republicans railed against Gingrich for sending what was seen as an anti-business message.
Democrats are betting that the Bain ads will resonate better with the wider populace in the general election than with Republican primary voters.
One criticism of Romney that does appear to be dying out is the accusation that he bullied a boy at his high school in the 1960s who was presumed to be gay.
A Reuters/Ipsos poll this week showed only 53 percent of Americans had heard of the incident and 28 percent said they viewed Romney less favorably because of it.
By: Patricia Zengerle and Steve Holland
(Editing by Alistair Bell and Todd Eastham)
A job-seeker fills out a job application during a job fair in San Francisco in March. (Justin Sullivan/Getty Images)
California’s jobs engine sputtered in April as employers trimmed their payrolls, breaking a streak of eight consecutive months of employment growth.
Employers shed 4,200 jobs, according to figures released Friday from the state’s Employment Development Department.
The unemployment rate dipped last month to 10.9% from 11% in March, but only because discouraged workers departed the labor force.
“The loss this month is clearly a disappointment,” said Esmael Adibi, director of Chapman University’s A. Gary Anderson Center for Economic Research. “The economy still has a long way to go to bring unemployment down in a significant way.”
The state lost jobs across a variety of sectors, including construction, education, leisure and hospitality and government.
California’s unemployment rate remains well above the national rate, which was 8.1% in April. Only two states have higher jobless rates: Nevada (11.7%) and Rhode Island (11.2%).
Still, California’s labor market is much improved from a year ago. The unemployment rate is down from 11.8% in April 2011, and the state has gained 175,600 jobs over that period.
“The picture is that California’s economy is slowly improving,” said Sung Won Sohn, an economics professor at California State University Channel Islands in Camarillo.
“If you look at employment gains over a longer period, over the last year, it’s clearly improved.”
There were some bright spots in the April figures. The professional and business services sector, which includes good-paying positions in accounting, law and engineering, saw the largest gain, adding 12,700 jobs. Other sectors gaining jobs included trade, transportation and utilities; and mining and logging.
Even with April’s job loss, Sohn predicts California’s job market will strengthen over the summer.
“I think the economy is moving in the right direction,” he said. April’s numbers “don’t really indicate that economic growth has stalled. Or is being derailed.”
In Los Angeles County, the unemployment rate also fell slightly, from 11.8% in March to 11.6%. In the Inland Empire, the unemployment rate fell to 11.7% from 12.7% in March, largely because more workers there left the labor force.
Adibi of Chapman University said the state should continue to add jobs in coming months, but not “enough to make a significant dent in the unemployment rate.”
By: Ricardo Lopez
Republican presidential candidate Mitt Romney talks to supporters during a campaign rally in St. Petersburg, Florida, May 16, 2012.
(Reuters) – The Republican Party’s fundraising arm working to elect its candidates to the U.S. House of Representatives raised $6.9 million in April, slightly more for the month than its Democratic counterpart.
National Republican Congressional Committee figures released on Friday showed that the NRCC ended last month with $31.3 million left in the bank, adding about $4.2 million to the cash on hand in March. Republicans currently have a majority in the House.
The Democratic Congressional Campaign Committee raised $6.5 million and had $25 million left on hand, according to its figures due to be officially reported to the Federal Election Commission by May 20.
The DCCC highlighted last month as the best April in its history, adding that so far this campaign season the party committee raised more than $90 million, besting Republicans.
Democrats are vying for dozens of House seats this campaign season, hoping to regain control of the lower chamber after a painful loss to Republicans in 2010. With formidable outside non-profit and Super PAC groups laying down millions to influence congressional races, national parties are preparing to spend their share on advertising and get-out-the-vote efforts.
Already, preparing for a battle over airwaves with other groups hoping to reach viewers during what is expected to be a heated presidential campaign, the DCCC has reserved more than $32 million worth of broadcast TV time for 36 races, predominantly in markets covering Republican incumbents.
The two party committees did not specify how much they spent in April, but calculations show the DCCC spent about $4.3 million and NRCC spent about $2.7 million.
In March, the DCCC raised $9.8 million and had just under $23 million left in cash on hand. The NRCC raised $9.3 million and had roughly $27 million left on hand.
(Reporting by Alina Selyukh; Editing by Lisa Shumaker and Vicki Allen)
(Reuters) – U.S. exports that have been a source of strength for the economy are under pressure from a worldwide slowdown in growth that is already under way, a senior U.S. Treasury Department official said on Friday.
Assistant Treasury Secretary Jan Eberly told an accountants’ group that the U.S. economy is vulnerable to weakening global conditions, and especially to Europe’s ongoing debt crisis.
“Economic growth in the world excluding the U.S. slowed to below four percent during 2011 from 5-1/2 percent during 2010,” Eberly said in prepared remarks. “This slowdown has negative implications for U.S. exports, which have been a source of strength for the U.S. economy over the past two years.”
She said Europe’s crisis was adding to volatility in U.S. and global financial markets and contributing to a growing risk of recession in the region.
(Reporting by Glenn Somerville; Editing by James Dalgleish)
"The fact that we are here today to debate raising America's debt limit is a sign of leadership failure. It is a sign that the U.S. Government can't pay its own bills…Instead of reducing the deficit, as some people claimed, the fiscal policies of this administration and its allies in Congress will add more than $600 million in debt for each of the next five years…Increasing America's debt weakens us domestically and internationally. Leadership means that 'the buck stops here.' Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better." as stated by Barak Obama when campaigning against then President George Bush.
After being immersed in the world of alternative economic analysis for several years, it sometimes becomes easy to forget that most people do not track forex markets, or debt to GDP ratio, or true unemployment, or hunch over IMF white-papers highlighting subsections which expose the trappings of the globalist ideology. Sometimes, you just assume the average person knows what the heck you are talking about. This is, of course, a mistake. However, it is a mistake that is borne from the inadequacy of our age and our culture, and is not necessarily a product of weak character, either of the analyst, or the casual reader.
The great frustration of being actively involved in the Liberty Movement is the fact that many people are rarely on the same page (or even the same book) during political and economic discussion. Where we see the nature of the false left/right paradigm, they see “free democracy”. Where we see a tidal wave of destructive debt, they see a “responsible government” printing and spending in order to protect our “best interests”. Where we see totalitarianism, they see “safety”. Where we see dollar devaluation, they see dollar strength and longevity. Ultimately, because the average unaware citizen is stricken by the disease of normalcy bias and living within the doldrums of a statistical fantasy world, they simply have no point of reference by which to grasp the truth when exposed to it. It’s like trying to explain the concept of ‘color’ to a man who has been blind since birth.
Americans in particular are prone to reactionary dismissal when exposed to facts that disrupt their misconceptions. Our culture has experienced a particularly prosperous age, not necessarily free from all trouble, but generally spared from widespread mass tragedy for a generous length of time. This tends to breed within societies an overt and unreasonable expectation of ease. It generates apathy, and laziness. A crushing blubberous slothful cynicism subservient to the establishment and the status quo. Even the most striking of truths struggle to penetrate this smoky force field of duplicitous funk.
In recent articles, I have outlined the very immediate dangers of several potential economic events that are likely to take place this year, including the exit of peripheral countries from the European Union, the conflict between austerity and socialist spending in France and Germany, the developing bilateral trade agreements between China and numerous other countries which cut out their reliance on the U.S. dollar, and the likelihood that the Federal Reserve will announce QE3 before the end of 2012. All of these elements are leading in one very particular direction: the end of the Greenback as the world reserve currency.
In response to these assertions I have received letters from some people (some of them indignant) questioning how it would be even remotely possible that the dollar could be replaced at all. The concept is so outside their narrow world view that many cannot fathom it.
To be sure, the question is a viable one. How could the dollar be unseated? That said, a few hours of light research would easily produce the answer, but this tends to be too much work for the fly-by-night financial skeptic. Sometimes, the job of the alternative analyst is to make the obvious even more obvious.
So, let’s begin…
The Dollar A Safe Haven?
This ongoing lunacy is based on multiple biases. For some, the dollar represents America, and a collapse of the currency would suggest a failure of the republic, and thus, a failure by them as individual Americans who live vicariously through the exploits of their government. By extension, it becomes “patriotic” to defend the dollar’s honor and deny any information that might suggest it is on a downward spiral.
Others see how the investment world clings to the dollar as a kind of panic room; a protected place where one’s saving will be insulated from crisis. However, just because a majority of day trading investors are gullible enough to overlook the Greenback’s pitfalls does not mean those dangerous weaknesses disappear.
There is only one factor that shields the dollar from implosion, and that is its position as the world reserve currency. Without this exalted status, the currency’s value vanishes. Backed by nothing but massive and unpayable debt, it sits frighteningly idle, like a time bomb, waiting for the moment of ignition.
The horrifying nature of the dollar is that it is only valuable so long as foreign investors believe that we will pay back the considerable debts that we (the American taxpayer at the behest of our criminally run Treasury) owe, and that we will not hyperinflate in the process. If they EVER begin to see their purchases of dollars and treasuries as a gamble instead of an investment, the façade falls away. Yet again this year Congress and the Executive Branch are “at odds” over the expansion of the debt ceiling, which has been raised to levels beyond the 100% of GDP mark.
Barack Obama has made claims that increases in the debt ceiling are “normal”, and that most presidents are prone to hiking the barrier every once in a while. Yet, back in 2006, when George W. Bush increased debt limits, Obama had this to say:
“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills…Instead of reducing the deficit, as some people claimed, the fiscal policies of this administration and its allies in Congress will add more than $600 million in debt for each of the next five years…Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck stops here.’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.”
For once, Barack and I agree on something. Too bad the man changes his rhetoric whenever it’s to his advantage.
Today, Obama now asserts that raising the debt ceiling is not an opening for more government spending, but an allowance for the government to pay bills it has already accrued. This is disingenuous and hypocritical prattle. Obama is well aware as are many in Congress that as long as the Federal Government is able to raise the debt ceiling whenever it suits them, they can increase spending with wild abandon. It’s like handing someone a credit card with no maximum limit. For most men, the temptation would be irresistible. Therefore, one can predict with 100% certainty that U.S. spending will never truly be reduced, and that our national debt will mount in tandem until we self destruct.
How has this trend been able to continue for so long? Our private central bank has created the fiat machine by which all economic depravity is possible. Currently, the Federal Reserve is the number one holder of U.S. debt. The Federal Reserve creates its own capital. It prints its wealth from thin air. The dollar, thus, has become its own lynchpin. The secretive institution which has never been subject to a full audit is now monetizing endless debt mechanisms with paper promises. What value would any intelligent investor put on such a fraudulent economic system?
The epic dysfunction of the dollar is rooted in its reliance on perception rather than tangible wealth or strong fundamentals. It is, indeed, like any other fiat unit, with all the inevitable pitfalls built into its structure.
Ironically, the value of the Dollar Index is measured not by its intrinsic buying power, or its historical buying power, but its arbitrary buying power in comparison with other collapsing fiat currencies.
The argument I hear most often when pointing out the calamitous path of the dollar is that it is the go-to safe haven in response to the crisis in Europe. What the financially inept don’t seem to grasp is that the shifting of savings back and forth between the euro and the dollar is just as irrelevant to our currency’s survival as it is to Europe’s. BOTH currencies are in decline, and this is evident by the growing inflationary pressures on both sides of the Atlantic. Ask any consumer in Greece, Spain, France, or the UK how shelf prices have changed in the past four years, and they will say the exact same thing as any consumer in the U.S.; costs have gone way up. Therefore, it makes sense to compare the dollar’s value not to the euro, or to the Yen, but something more practical, like the dollar of the past….
In 1972, just as Nixon was removing the dollar from the last vestiges of the gold standard, a new car cost an average of $4500. A home cost around $40,000. A gallon of gas was .36 cents. A loaf of bread was .25 cents. A visit to the doctor’s office was $25. Wages were certainly lower, but they kept much better pace with the prices of the era. Today, the gap between wages and inflation is insurmountable. The average family is unable to keep up with the flashflood of rising prices.
According to the historic buying power of the dollar, the currency is a poor safe haven investment. With the advent of bailout efforts and debt monetization through quantitative easing, its devaluation has been expedited dramatically. The Fed has left the door open for what I believe will be a final destructive round of publicly announced QE, weakening the dollar to near death.
The question then arises; why do foreign countries continue to buy in on the greenback?
The Dollar Dump Has Already Begun
One of my favorite arguments by those defending the dollar is the assertion that no foreign country would dare to dump the currency because they are all too dependent on U.S. trade. To answer the question above, the reality is that foreign countries ARE already calmly and quietly dumping the dollar as a global trade instrument.
To those people who consistently claim that the dollar will never be dropped, my response is, it already has been dropped! China, in tandem with other BRIC nations, has been covertly removing the greenback as the primary trade unit through bilateral deals since 2010. First with Russia, and now with the whole of the ASEAN trading bloc and numerous other markets, including Japan. China in particular has been preparing for this eventuality since 2005, when they introduced the first Yuan denominated bonds. The bonds were considered a strange novelty back then, especially because China had so much surplus savings that it seemed outlandish for them to take on treasury debt. Today, the move makes a whole lot more sense. China and the BRIC nations today openly call for a worldwide shift away from the dollar.
With the global proliferation of the Yuan, and the conversion of the Chinese economy away from dependence on exports (especially to the West) towards a more consumer based system, the Chinese have effectively decoupled from their reliance on U.S. markets. Would a collapse in the U.S. hurt China’s economy? Yes. Would they still survive? Oh yes. Far better than America would, at least…
In 2008, I warned of this development and was attacked on all sides by more mainstream economists and Keynesian proponents who stated that such a development was impossible. Today, it’s common knowledge that our primary creditors are “diversifying” away from the dollar, though MSM talking heads and those who parrot them still claim that this is not a threat to our economy.
To be clear, the true threat to the dollar’s supremacy is not only due to the constant printing by the private Federal Reserve (though that is a nightmare in the making), but the loss of faith in our currency as a whole. The Fed does not need to throw dollars from helicopters to annihilate our currency; all they have to do is create doubt in its viability.
The bottom line? A dollar collapse is not “theory” but undeniable fact in motion at this moment, driven by concrete actions on the part of the very nations that have until recently propped up our debt obligations. It is only a matter of time before the dollar diminishes and fades away. All signs point to a loss of reserve status in the near term.
What Will Replace The Dollar?
My next favorite argument in defense of the Greenback is the assertion that there is “no currency in a position to take the dollar’s place if it falls”. First of all, this is based on a very naïve assumption that the dollar will not fall unless there is another currency to replace it. I’m not sure who made that rule up, but the dollar is perfectly able to be flushed without a replacement in the wings. Economic collapse does not follow logical guidelines or the personal pet peeves of random man-child economists.
Though, to be fair, and to educate those unaware, there IS a replacement already conveniently ready to roll forward. The IMF has for a couple of years now openly called for the retirement of the dollar as the world reserve currency, to be supplanted by the elitist organization’s very own “Special Drawing Rights” (SDR’s).
The SDR is a paper mechanism created in the early 1970’s to replace gold as the primary means of international trade between foreign governments. Today, it has morphed into a basket of currencies which is recognized by almost every country in the world and is in a prime position to take the dollar’s place in the event that it loses reserve status. This is not theory. This is cold hard reality. For those who claim that the SDR is not considered a “real currency”, they should probably warn the U.S. Post Office, which now uses conversion tables that denominate costs in SDR’s.
So, now that we know a replacement for the dollar is ready to go, the next obvious question would be:
Why would global elites destroy a useful monetary tool like the dollar? Why kill the goose that “lays the golden eggs”? People who ask this question are simply unable to see outside the fiscal box they have been placed in. For global bankers, a paper currency is not important. It is expendable. Like a layer of snake skin; as the snake grows, it sheds the old and dawns the new.
At bottom, men who promote the philosophies of globalization greatly desire the exaltation of a global currency. The dollar, though a creation of a central bank, is still a semi-sovereign monetary unit. It is an element that is getting in the way of the application of the global currency dynamic. I find it rather convenient (at least for those who subscribe too globalism) that the dollar is now in the midst of a perfect storm of decline just as the IMF is ready to introduce its latest fiat concoction in the form of the SDR. I find the blind faith in the dollar’s lifespan to be rife with delusion. It is not a matter of opinion or desire, but a matter of fact that currencies in such tenuous positions fall, and are in the end replaced. I believe that the evidence shows that this is not random chance, but a deliberate process, leading towards the globalist ideal; total centralization of the world under an unaccountable governing body which operates a global monetary system utterly devoid of transparency and responsibility.
The dollar was a median step towards a newer and more corrupt ideal. Its time is nearly over. This is open, it is admitted, and it is being activated as you read this. The speed at which this disaster occurs is really dependent on the speed at which our government along with our central bank decides to expedite doubt. Doubt in a currency is a furious omen, costing not just investors, but an entire society. America is at the very edge of such a moment. The naysayers can scratch and bark all they like, but the financial life of a country serves no person’s emphatic hope. It burns like a fire. Left unwatched and unchecked, it grows uncontrollable and wild, until finally, there is nothing left to fuel its hunger, and it finally chokes in a haze of confusion and dread…
By: Brandon Smith
Reports say Hewlett-Packard is poised to eliminate up to 30,000 jobs to help offset dwindling demand for personal computers.
Hewlett-Packard’s (NYSE: HPQ) chief executive, Meg Whitman, plans to cut 30,000 or more jobs next week, according to officials familiar with the plan, reports the New York Times.
Whitman’s goal, the sources told the NYT on Thursday, is to spend the money she saves to help increase the efficiency of the company’s sales force and to create new products.
Executives who spoke to the NYT on the condition of anonymity said Hewlett-Packard will seek layoffs and voluntary retirements from across the company.
The final plan is expected to be made public Wednesday, when H.P. announces earnings for its second fiscal quarter, the newspaper reported
It was unclear form the NYT report if layoffs will occur in Georgia.
Speaking in Prague, prime minister compares Iran's nuclear drive to that of North Korea's, says goal of upcoming negotiations should be freeze, removal of Iranian enrichment; IAEA expresses optimism ahead of talks.
Prime Minister Binyamin Netanyahu on Friday dismissed a new surge of optimism in the international community that Iran might be prepared to halt its nuclear program.
“I have seen no evidence whatsoever that Iran is serous about stopping its nuclear weapons program,” Netanyahu said at the tail end of his meeting in Prague with the president of the Czech Republic, Vaclav Klaus.
In their meeting, Netanyahu expressed concern about talks by the six powers — US, Russia, China, France, Germany and Great Britain — on Iran, set to take place in Baghdad on May 23. These talks follow a meeting held in Istanbul in April.
“It looks as though they (Iran) see these talks as another opportunity to deceive and delay, just like North Korean did for years,” Netanyahu said. “They may try to go from meeting to meeting with empty promises. They may agree to something in principle but not implement it. They may even agree to implement something that does not materially derail their nuclear weapons program,” he said.
“Iran is good at playing this chess game. They know that sometimes you have to sacrifice a pawn to save the King,” Netanyahu said.
“The goal of these negotiations should be very clear. Freeze all enrichment inside Iran. Remove all enriched material and dismantle [the uranium enrichment facility near the city of] Qom,” he said.
“When this goal is achieved I will be the first to applaud. Until then count me among the skeptics,” he said.
Netanyahu arrived in the Czech Republic earlier on Thursday accompanied by seven cabinet ministers, including Foreign Minister Avigdor Liberman. After the prime minister met with his counterpart, Czech Prime Minister Petr Necas, the Israeli and Czech delegations signed a joint declaration expressing “concern at Iran’s efforts to enrich uranium for military purposes, even as it threatens to destroy Israel.”
In an exclusive interview with The Jerusalem Post on Thursday, Necas said that the Czech Republic would like to continue to be a strong supporter of Israel within the European Union. “We are concerned about the Iranian missile and nuclear programs,” he said.
Netanyahu’s comments came amid optimism expressed by diplomats involved in Iran-International Atomic Energy Agency (IAEA) negotiations over the former’s contentious nuclear program. Iran is seeking a framework deal over its atomic activity, which it says is needed before it can consider a request by UN inspectors to visit the Parchin military site where they believe explosives tests relevant for developing nuclear weapons may have been carried out.
The IAEA and Iran held talks this week in Vienna and are due to meet again on May 21, two days before Tehran and the six global powers discuss the future of its disputed nuclear program in Baghdad.
Two previous rounds of talks in Tehran early this year failed to make any notable progress. But both sides were more upbeat after the May 14-15 meeting in the Austrian capital, raising hopes of a possible outcome when talks resume on Monday.
A non-Western envoy said: “Progress has been made. There are still one or two outstanding issues. My impression is that both sides have the willingness to move forward.”
Iran denies having a covert atomic bomb agenda, saying it is enriching uranium only for a future network of civilian nuclear power stations and a medical isotope reactor.
By: TOVAH LAZAROFF
Contributing: Jpost.com and Reuters
Our plan is to do exactly what John McCain would not let us do: Show the world how Barack Obama’s opinions of America and the world were formed,” the proposal says. “And why the influence of that misguided mentor and our president’s formative years among left-wing intellectuals has brought our country to its knees.
WASHINGTON — A group of high-profile Republican strategists is working with a conservative billionaire on a proposal to mount one of the most provocative campaigns of the “super PAC” era and attack President Obama in ways that Republicans have so far shied away from.
Timed to upend the Democratic National Convention in September, the plan would “do exactly what John McCain would not let us do,” the strategists wrote.
The plan, which is awaiting approval, calls for running commercials linking Mr. Obama to incendiary comments by his former spiritual adviser, the Rev. Jeremiah A. Wright Jr., whose race-related sermons made him a highly charged figure in the 2008 campaign.
“The world is about to see Jeremiah Wright and understand his influence on Barack Obama for the first time in a big, attention-arresting way,” says the proposal, which was overseen by Fred Davis and commissioned by Joe Ricketts, the founder of the brokerage firm TD Ameritrade. Mr. Ricketts is increasingly putting his fortune to work in conservative politics.
The $10 million plan, one of several being studied by Mr. Ricketts, includes preparations for how to respond to the charges of race-baiting it envisions if it highlights Mr. Obama’s former ties to Mr. Wright, who espouses what is known as “black liberation theology.”
The group suggested hiring as a spokesman an “extremely literate conservative African-American” who can argue that Mr. Obama misled the nation by presenting himself as what the proposal calls a “metrosexual, black Abe Lincoln.”
A copy of a detailed advertising plan was obtained by The New York Times through a person not connected to the proposal who was alarmed by its tone. It is titled “The Defeat of Barack Hussein Obama: The Ricketts Plan to End His Spending for Good.”
The proposal was presented last week in Chicago to associates and family members of Mr. Ricketts, who is also the patriarch of the family that owns the Chicago Cubs.
Brian Baker, president and general counsel of a super PAC called the Ending Spending Action Fund, said Mr. Ricketts had studied several advertising proposals in recent months and had not signed off on a specific approach to taking on Mr. Obama.
“Joe Ricketts is prepared to spend significant resources in the 2012 election in both the presidential race and Congressional races,” Mr. Baker said in an interview Wednesday. “He is very concerned about the future direction of the country and plans to take a stand.”
The document makes clear that the effort is only in the planning stages and awaiting full approval from Mr. Ricketts. People involved in the planning said the publicity now certain to surround it could send the strategists back to the drawing board.
But it serves as a rare, detailed look at the birth of the sort of political sneak attack that has traditionally been hatched in the shadows and has become a staple of presidential politics.
It also shows how a single individual can create his own movement and spend unlimited sums to have major influence on a presidential election in a campaign finance environment in which groups operating independently of candidates are flourishing.
Should the plan proceed, it would run counter to the strategy being employed by Mitt Romney’s team, which has so far avoided such attacks. The Romney campaign has sought to focus attention on the economy, and has concluded that personal attacks on Mr. Obama, who is still well liked personally by most independent voters surveyed for polls, could backfire.
Mr. Ricketts has become an increasingly active player in Republican politics through several political action committees, including Ending Spending. He has a son, Pete, who is a member of the Republican National Committee from Nebraska and a daughter, Laura, who is a top contributor to Mr. Obama’s re-election campaign. She has not been involved in her father’s political efforts.
The 54-page proposal was professionally bound and illustrated with color photographs, indicating that it is far beyond a mere discussion. The strategists have already contacted Larry Elder, a black conservative radio host in Los Angeles, about serving as a spokesman, and the plan calls for a group of black business leaders to endorse the effort. The strategists have also registered a domain name, Character Matters.
The proposal suggests that Mr. Ricketts believes the 2008 campaign of Senator John McCain erred in not using images of Mr. Wright against Mr. Obama, who has said that the pastor helped him find Jesus but that he was never present for Mr. Wright’s politically charged sermons. Mr. Obama left the church during the campaign.
Apparently referring to a Wright ad that was produced for the McCain campaign by Mr. Davis’s firm but never used, the proposal opens with a quote from Mr. Ricketts: “If the nation had seen that ad, they’d never have elected Barack Obama.”
The planning document is emblazoned with the logo of Strategic Perception, the political advertising firm of Mr. Davis, the colorful Republican operative who last worked on the Republican presidential campaign of former Gov. Jon M. Huntsman of Utah. Included on his “Recommended Team of Pirates” are the former Huntsman pollster Whit Ayres and the McCain campaign Internet strategist Becki Donatelli.
The document, which was written by former advisers to Mr. McCain, is critical of his decision in 2008 not to aggressively pursue Mr. Obama’s relationship with Mr. Wright. In the opening paragraphs of the proposal, the Republican strategists refer to Mr. McCain as “a crusty old politician who often seemed confused, burdened with a campaign just as confused.”
“Our plan is to do exactly what John McCain would not let us do: Show the world how Barack Obama’s opinions of America and the world were formed,” the proposal says. “And why the influence of that misguided mentor and our president’s formative years among left-wing intellectuals has brought our country to its knees.”
The plan is designed for maximum impact, far beyond a typical $10 million television advertising campaign. It calls for full-page newspaper advertisements featuring a comment Mr. Wright made the Sunday after the attacks of Sept. 11, 2001. “America’s chickens are coming home to roost,” he said.
The plan is for the Democratic National Convention in Charlotte, N.C., to be “jolted.” The advertising campaign would include television ads, outdoor advertisements and huge aerial banners flying over the convention site for four hours one afternoon.
The strategists grappled with the quandary of running against Mr. Obama that other Republicans have cited this year: “How to inflame their questions on his character and competency, while allowing themselves to still somewhat ‘like’ the man becomes the challenge.”
Lamenting that voters “still aren’t ready to hate this president,” the document concludes that the campaign should “explain how forces out of Obama’s control, that shaped the man, have made him completely the wrong choice as president in these days and times.”
By JEFF ZELENY and JIM RUTENBERG
Republican presidential candidate Mitt Romney greets the crowd at the River City Brewing Co. in Jacksonville, Fla. (Bob Self / Associated Press / May 17, 2012)
WEST PALM BEACH, Fla. — During the course of the presidential campaign, Mitt Romney has proudly claimed his roots as native Michigander, a Bostonian (who is unfailingly loyal to the Red Sox), a summer resident of New Hampshire and, of course, a part-time Californian when he escapes to his beachfront home in La Jolla.
But he surprised some members of his audience Thursday at a brewery in Jacksonville when he mentioned that they had considered putting a new coastal destination on that list: the mighty swing state of Florida. “You know my wife – I wish she were here today. … She has said someday, who knows, we might move to Florida. You never know. Someday, way down the road.”
“We had the chance during the primaries to be able to go all over the country and see a lot of places, and she said ‘You know what? If we are going to move, one place I love [is] Jacksonville, Florida,’” Romney told the crowd, which cheered. “She knows a good thing when she sees it.”
Later, on his charter flight from Jacksonville to West Palm Beach, a reporter asked Romney what he and his wife found most appealing about Jacksonville. “We love California,” he replied. “But there are attractions to Florida. It has the right tax rates, among others.”
In the short term, Romney said, he was heading to his family’s summer home at New Hampshire’s Lake Winnipesaukee to get the house ready for the summer. “I’m going to do that this Saturday,” he said. “It will be me alone. Put the boat in the water. Get out the picnic tables. By myself.”
Though Romney has a had busy week of fundraisers and other events, the candidate was in a jovial mood Thursday — and he was especially friendly to the media a day after several of his aides tried to block reporters from approaching the usually distant candidate on the rope line. (The aides had tried to enforce a new rule that would have put greater restrictions on press movements within his events, but then the campaign said the effort by aides had been an error.)
Since then, Romney has gone out of his way to spend more time with reporters, chatting — though briefly — on each of his flights around Florida. After his rally and news conference in Jacksonville, he came back onto the plane bearing warm chocolate chip cookies that had been given to him at his event.
Romney, who stays trim by running or biking each morning that he is on the road, offered his tips on how not to gain weight on the campaign trail: “High stress,” he told reporters.
An hour later, he approached reporters with his iPad on the tarmac after the flight bearing a picture of his grandson, 5-year-old Parker, who had formed his hair into a mohawk with the help of his mom.
“You know how she did that? With Elmer’s glue and egg whites. I kid you not . … Isn’t that something else?” Romney said, laughing. He said he’d never tried such an elaborate styling job on his own hair when he was he was younger.
“I never did my hair like that but I’m thinking about it,” he said. “People wonder how I keep my hair like it is – it’s like a little Elmer’s glue and egg white would probably go a long way.”
“Isn’t that too much?” he said, showing off the picture of Parker. “Too much. I miss him.”
By: Maeve Reston
Oil markets spent most of the day under pressure from the dollar, which regained some strength mid-session.
SAN FRANCISCO (MarketWatch) — Crude-oil futures on Wednesday ended at their lowest since November as concerns about Greece and the euro zone kept their grip on the market.
Boosts from the weekly government report on inventories and positive U.S. data were short-lived.
Prices had trimmed their decline after data on housing and industrial production and after the supply report showed an increase for crude but supportive numbers for crude products.
Oil for June delivery CLM2 ended the day off $1.17, or 1.2%, to $92.81 a barrel on the New York Mercantile Exchange. That was oil’s lowest close since Nov. 2 and the fourth loss in a row.
Earlier Wednesday, the Energy Information Administration reported an increase of 2.1 million in crude inventories in the week ended May 11.
Analysts polled by Platts had expected a rise by 1.5 million barrels.
Supplies of crude kept at a record.
The EIA also reported gasoline supplies declined by 2.8 million barrels, and distillates inventories were down by 1 million barrels.
The analysts surveyed by Platts had forecast gasoline inventories down 480,000 barrels and distillates stockpiles up 120,000 barrels.
Gasoline and jet fuel production have not kept up, which will lead to higher retail prices and higher transportation costs, said Carl Larry, with Oil Outlooks and Opinions in Houston.
Larry forecast gasoline to average as much as $4.10 at the pump in the next 4 to 5 weeks, with prices around $5 in pricier markets such as California.
Meanwhile, oil markets spent most of the day under pressure from the dollar, which regained some strength mid-session.
Investors have elected the greenback as a safer place to park their money against the backdrop of European turmoil.
The ICE dollar index, which measures the U.S. unit against a basket of six currencies, was recently at 81.360, compared with 81.286 in late North American trading on Tuesday. The dollar was on track to keep at its longest rally in two decades.
Meanwhile, June heating oil traded down 4 cents, or 1.2%, to finish at $2.90 a gallon, and gasoline for the same month lost 2 cents to $2.92 a gallon.
Natural gas bucked the trend ahead of its own inventories report.
Natural gas for June delivery rose 12 cents, or 4.7%, to $2.62 per million British thermal units.
The EIA is scheduled to report on natural-gas inventories Thursday. Natural-gas analysts at Jefferies forecast an increase of 50 billion cubic feet for the week, versus last year’s 86 billion cubic feet increase in the comparable week.
So far this month, natural gas is up 15%. Year-to-date, however, prices are off 12%.
By: Claudia Assis and Sarah Turner, MarketWatch
Claudia Assis is a San Francisco-based reporter for MarketWatch.
Sarah Turner is MarketWatch’s bureau chief in Sydney.
WASHINGTON – Federal Reserve policymakers are open to further efforts to stimulate the U.S. economy if growth falters or threats escalate.
At a news conference after April's meeting, Chairman Ben Bernanke left open the possibility of further Fed action to stimulate the economy. Private economists generally say another round of Fed bond buying isn't likely unless the economic outlook darkens considerably.
Minutes of the central bank’s April 24-25 meeting released Wednesday stated that “several members” thought additional Fed support could be needed if the recovery lost momentum or if the risks to the economy became great enough.
The minutes did not spell out what circumstances would trigger further Fed efforts to lower interest rates to boost the economy. But they did note some threats to the U.S. economy. One is Europe’s debt crisis. Another is the risk that spending cuts and tax increases that could take effect at year’s end if Congress can’t reach a budget agreement could slow growth more than expected.
The comments stood in contrast to the previous minutes, which said that only “a couple” of members expressed support for further bond purchases. Since the financial crisis, the Fed has pursued two rounds of bond purchases to try to push down long-term interest rates, with a goal of encouraging borrowing and spending.
Private economists said the change in wording to “several” from “a couple” raised the possibility of further Fed action. But analysts said they still think no further moves will occur unless Europe’s crisis worsens or a budget impasse in Congress threatens the U.S. economy.
“Nothing in the minutes changes our view on policy,” said Sal Guatieri, senior economist at BMO Capital Markets.
The Fed also announced Wednesday that for the rest of this year and next year all of its meetings will last for two days to allow more time for discussion. Until now, some policy meetings had lasted only one day.
The Fed also altered the schedule for releasing a quarterly update of its economic forecasts. That release will occur when the Fed meets in the third month of each quarter: March, June, September and December. After those meetings, Bernanke will discuss the Fed’s new outlook with reporters.
Before the change, those forecasts and Bernanke’s news conferences occurred in January, April, June and October. Bernanke started holding regular news conferences a year ago.
The minutes released Wednesday cover the discussion that took place at the April meeting. In a statement after that meeting, Fed officials repeated their plan to keep a key short-term interest rate at a record low until at least late 2014. The action was approved on a 9-1 vote.
Jeffrey Lacker, president of the Federal Reserve Bank of Richmond, opposed retaining the late-2014 target date. The minutes said Lacker believed the Fed will have to start increasing interest rates by mid-2013 in order to keep inflation under control.
At a news conference after April’s meeting, Chairman Ben Bernanke left open the possibility of further Fed action to stimulate the economy. Private economists generally say another round of Fed bond buying isn’t likely unless the economic outlook darkens considerably.
Bernanke said at his news conference that more bond purchases, or other steps by the Fed, were still an option if the economy weakens. He declared that “those tools remain very much on the table.”
Critics have expressed concerns that the central bank was raising the risk of higher inflation with its long-running campaign to keep rates low. The minutes showed that Lacker thought the Fed would need to begin raising interest rates by mid-2013 to keep inflation under control.
The Fed has kept its federal funds rate, the target for overnight bank lending, near zero since December 2008. That means consumer and business loans tied to that rate have also remained at super-low levels. The lower those loan rates, the more likely it is that consumers and companies will borrow and spend to invigorate the economy.
By: Martin Crutsinger, Associated Press
Some Massachusetts residents agree, feeling that Romney used the state as a springboard for his national political ambitions. Some seem to resent him for it.
BELMONT, Mass. (AP) — Don’t bet on Republican presidential candidate Mitt Romney winning his home state or even trying.
“That’s not been a topic of discussion,” Romney campaign adviser Kevin Madden said when asked if the former Massachusetts governor would compete in the heavily Democratic state.
Aides say there are other ways he can win the White House and deny President Barack Obama a second term without banking on Massachusetts’ 11 electoral votes.
That political reality illustrates the degree to which Romney’s efforts to curry favor with conservative Republicans in the primaries has alienated the moderate base that launched his political career.
If Romney were lose Massachusetts and still defeat Obama, he would be the first presidential candidate elected without carrying his home state since 1916, when Democratic President Woodrow Wilson retained the White House despite New Jersey’s absence from the win column.
In 2000, Democrat Al Gore, who had spent years in Washington as a senator and vice president, fell short of winning Tennessee in his losing White House bid. Other notable home-state losers include Democrats Hubert Humphrey of Minnesota in 1968 and Adlai Stevenson of Illinois in 1952 and 1956. Republicans need to go back to 1936 to find a nominee who didn’t carry his home state: Kansas Gov. Alf Landon.
Romney aides argue that it would be a waste of money to run TV ads and compete in a state Obama carried by 25 percentage points in 2008.
Some Massachusetts residents agree, feeling that Romney used the state as a springboard for his national political ambitions. Some seem to resent him for it.
“He doesn’t know where he lives,” said Mike Egan, a retired independent sitting at a Dunkin’ Donuts in Belmont, near Romney’s home.
While Romney’s permanent address is the home he keeps in this upscale Boston suburb, he spends considerable time, including holidays and vacations, at his homes in California and New Hampshire.
Egan and others say Romney seemed to have his eye on the White House as soon as he arrived at the Massachusetts State House in 2003.
The following year, he made his first trip to Iowa, home of the leadoff presidential caucuses, to speak at the state GOP’s fall banquet some weeks before President George W. Bush’s re-election.
He would visit Iowa three times in 2005 and nine times in 2006. That year, Romney spent 212 days outside of Massachusetts. One trip included a visit to Iraq and Afghanistan to enhance his international credentials, just as his state grappled with a devastating flood.
“By the time he left, it became clear to everybody that he was committed to national politics,” said Massachusetts Republican Sheldon Binder, a retiree who supported Romney, as he sat near Egan.
Republicans had held the governorship for 12 straight years by the time Romney took office in 2003.
Voters were comfortable supporting candidates with right-of-center fiscal profiles. Romney’s moderate profile, including support of abortion and gay rights, fit in with other Republicans.
But some in Massachusetts were turned off by what they saw as Romney’s effort to project a more conservative profile on hot-button issues, in part to prepare to court socially conservative activists in states such as Iowa that hold early nominating contests in election years.
Romney reversed his position on abortion while in office. After advocating full equality for gay and lesbian couples, he publicly condemned the Massachusetts Supreme Court decision in 2003 to allow gay marriage.
“He’s a moderate. He’s not a conservative Republican in the true sense of the word,” said Matt Walsh, a 36-year-old advertiser from Mansfield who sat with his mother at the doughnut shop. “That’s why he played well at first. He won the voters in the middle.”
Romney was elected governor with 50 percent of the vote. His approval ratings, while never soaring, topped 50 percent in public opinion polls at times during his one term. But by the October before he left office in 2007, Romney’s approval had dipped to 34 percent in a Boston Globe poll.
With Massachusetts apparently out of reach, Romney aides are trying to claim his native Michigan as the campaign’s home turf. But while Obama can bank on winning his home state of Illinois, Michigan is no lock for Romney.
Romney, 65, was born in Detroit and grew up nearby in Bloomfield Hills, but hasn’t lived in Michigan since he was a teenager. Despite Michigan being viewed as competitive in recent campaigns, no Republican has carried the state since George H. W. Bush in 1988.
What’s more, Obama and other Democrats have criticized Romney for opposing the 2008 federal bailout of Detroit-based automakers Chrysler and General Motors. Romney favored allowing the companies to go through bankruptcy without taxpayer help.
Obama frequently highlights his decision to extend the companies a lifeline and their return to profitability as one of the successes of his administration.
Still, Michigan is more within Romney’s reach than for any Republican in nearly a quarter century.
His family name, made by his father, George, once a governor and an automotive executive in Michigan, still resonates in the state. Romney also has influential contacts in the state, which he reminded voters about at every stop while campaigning for Michigan’s GOP primary in February, which he won.
Michigan also has trended Republican in recent state elections, including a 2010 GOP sweep of statewide offices. Detroit, the dominant force for Democrats, has seen its population shrink amid the auto industry’s troubles, while its suburbs and western and northern Michigan have kept their GOP complexion.
“The climate is much more ripe for a Republican victory in 2012,” said Jeff Timmer, a former Michigan Republican Party director. “When you add to that he does have home-state roots and an established presence, it adds an element to Michigan that no other candidate has brought to this state in a long time.”
So while Michigan may also be a stretch, it rates higher than Massachusetts on Romney’s priority list, according to former New Hampshire Gov. John Sununu.
Of Romney’s chances in Massachusetts, Sununu said: “I wouldn’t rule it out completely — even though it’s No. 50 on the list.”
By: Steve Peoples
Beaumont reported from Iowa.
Cain, a former presidential candidate, backed Newt Gingrich after dropping out of the race. | AP Photo
First he endorsed the American people. Then he got behind Newt Gingrich.
Now, Herman Cain is backing Mitt Romney.
In front of the Capitol Hill Club in a hastily called press conference Wednesday, the former pizza chain executive officially endorsed the all-but-official Republican presidential nominee – proclaiming the need for unity in the Republican Party in order to defeat President Barack Obama in November.
“My endorsement evolved,” Cain said when asked about his changing endorsements. “Early in the process is one thing, but as we converged toward the convention, what we did earlier isn’t as relevant. It wasn’t a matter of changing my mind … now that the process is winding down, I felt it fitting to offer a formal endorsement because I have been consistent throughout my participation in the process and that is I would endorse the ultimate nominee.”
Flanked by Republican Reps. Steve King of Iowa and Michele Bachmann of Minnesota, Cain acknowledged that there were a “lot of people” who may not be as excited about Romney as the nominee.
“So why am I willing to endorse him?” Cain said. “Governor Romney gets it right on the big issues. President Obama gets it wrong on all the big issues.”
By: SEUNG MIN KIM
Every president since Richard Nixon has called for the U.S. to wean itself from needing oil from unstable or unsavory countries. The nation's new-found energy riches are likely to bring that ambition closer to reality in the next two decades, according to many forecasters.
Williamsport, Pa., used to be celebrated for its past — as the 1938 birthplace of Little League Baseball, which still plays its annual World Series nearby. Then natural gas was found.
Now this once-sleepy chunk of north-central Pennsylvania is a star on the map of an emerging national energy rush. Six hotels are new or being built, and about 100 companies have moved to town, sometimes so fast that the head of the local Chamber of Commerce has told executives wanting guided tours to wait.
“I’ve said, ‘Look sir, get in line,’ ” says Vince Matteo, chief executive of the Williamsport/Lycoming chamber. “Now I know people in their 20s with high school (diplomas) making $120,000 a year.”
Much of Wall Street and Washington is seized by the hope that the U.S.‘s energy future will be as bright as Williamsport’s. As Americans heave a sigh of relief at gasoline prices falling back from near $4 a gallon, big new discoveries of domestic oil and natural gas hold the promise of more substantial benefits for the U.S. economy for decades to come — even the possibility of energy independence.
Every president since Richard Nixon has called for the U.S. to wean itself from needing oil from unstable or unsavory countries. The nation’s new-found energy riches are likely to bring that ambition closer to reality in the next two decades, according to many forecasters.
It’s no pipe dream. The U.S. is already the world’s fastest-growing oil and natural gas producer. Counting the output from Canada and Mexico, North America is “the new Middle East,” Citigroup analysts declare in a recent report.
The U.S. Energy Information Agency says U.S. oil imports will drop 20% by 2025. Oil giant BP projects the U.S. will get 94% of its energy domestically by 2030, up from 77% now, as oil imports fall by half. Energy billionaire T. Boone Pickens, a major investor in oil and natural-gas companies, said the U.S. can at least end oil imports from Organization of Petroleum Exporting Countries, about half its total, through new drilling and by shifting diesel-swilling trucks to natural gas. Any other oil needs should be from politically stable allies such as Canada, Pickens said.
Most enticing, a team of analysts and economists at Citigroup argues that the U.S., or at least North America, can achieve energy independence by 2020, as more domestic production and doubling down on conservation produce a virtuous cycle. The U.S. can make itself a net exporter of crude oil, refined products and natural gas — says Citigroup energy strategist Seth Kleinman.
“The notion of the U.S. getting to zero net imports of oil is obviously a sexy notion, but it’s not necessary for it to mean the world will change,” he says. “We are seeing a dramatic collapse in U.S. net imports of oil as we speak, to the tune of almost 1 million barrels a day each year over the last four years.”
If anything like that happens, an improbable-sounding litany of good things can result.In practical terms, more energy independence could mean 3.6 million new jobs, enough to cut unemployment by two percentage points, Citigroup argues. It could help manufacturers and chemical businesses that use lots of energy or make products from natural gas. It might give the U.S. a structural advantage on trade partners in energy costs, helping to offset the edge that cheaper labor gives nations such as China, Kleinman says. Already, U.S. natural gas prices are a seventh of what they are in Beijing, Pickens says.
“The potential is clearly there for a genuine revitalization and reindustrialization of the economy,” Kleinman says. “In industries where energy is a major element of costs, the U.S. is moving into a uniquely advantaged position.”
After years of gripes that the U.S. imports too much oil, the energy industry is pumping a gusher of good-news numbers:
•The U.S. price of natural gas has plummeted more than 80% since 2008, including nearly 45% in the last year, thanks to new supplies. The falling cost of natural gas alone will save U.S. households $926 a year between now and 2015, consulting firm IHS Global Insight says.
•The USA’s 15% gain in crude-oil production since 2008 is by far the world’s biggest, with new fields just beginning to be developed. The U.S. has overtaken Russia as the world’s largest refined-petroleum exporter, according to Citigroup.
•Utilities’ switchover to cheap natural gas from coal is lowering power bills. One utility switching to more gas plants, Georgia Power, has filed to cut Atlanta-area electricity rates 6%, citing a 19% drop in fuel costs.
Drill and conserve
A dozen years after Texas wildcatter George Mitchell commercialized a new gas-drilling technology called hydraulic fracking, the new energy boom is taking off. It began with gas, as fields such as the Marcellus Shale in the Northeast and the Barnett Shale in Texas began producing gas that hadn’t been recoverable until Mitchell combined fracking — which uses chemicals, water and sand to force gas out of rock — with horizontal drilling, which yielded much more than simply drilling straight down.
More recently, the same technologies have been adapted to drill for oil. Oil fields are being developed from Pennsylvania to Alaska — a half-dozen or more major sites, each including many smaller ones.
The rush to oil from gas is now so fast that Devon Energy, the No. 3 independent oil-and-gas-driller, isn’t drilling a single new gas well this year, CEO John Richels says.
Because of fracking, Citi says U.S. oil production might climb more than a third by 2015, driven by “tight oil” from shale and tar sands that until recently was too costly to extract. Government estimates say domestic production will rise 22% by 2020 to 6.7 million barrels per day. At the same time, the 19 million barrels that Americans burn daily may fall by 2 million, by Citi’s numbers. One reason: The EIA says the U.S. will be 42% more energy-efficient by 2035, continuing an enduring trend.
One reason for all that new efficiency is regulation.
Automakers face federal corporate-average fuel economy standards doubling, to up to 54.5 miles per gallon by 2025. A 2007 law requires oil companies to quadruple production of renewable auto fuels by 2022. States such as California are making utilities buy up to 60% more renewable-sourced electricity by 2020, says Stuart Hemphill, vice president for power supplies at Southern California Edison. “In California, only two kinds of (energy-producing) facilities are getting built — natural gas and solar,” Hemphill says.
Why $2 gasoline is unlikely
For consumers, America’s new energy supplies help contain costs — but they’re not a magic path back to $2 gasoline.
The good news: Natural-gas heating costs have dropped nearly 40% since 2008, undoing half their 160% climb after 1999. Electricity costs have remained flat, too.
The bad news: Gasoline prices have flirted with all-time highs this year, and even the fast-emerging new supplies are unlikely to offer major relief soon.
To understand why, it helps to master some numbers.
First is the number two — the U.S. has two main energy markets, one each for electricity and transportation. They’re very different. Electric utilities use mostly coal, natural gas and nuclear power, or renewables, almost all from the U.S. and Canada. Cars use oil, about 45% of it imported.
The second big number is 86 — the 86 million barrels of crude produced worldwide daily. About 19 million are burned in the U.S., three-fourths of them for transportation, the government says. About 8.9 million are imported, 4.2 million from OPEC. Bringing crude-oil imports down will be about changing how Americans fill gas tanks — or whatever advanced electric-car battery replaces gas tanks.
Domestic natural-gas gluts will do little for real energy independence until more cars use electricity or natural gas, says Hemphill. That’s one reason Pickens is campaigning to subsidize converting business truck fleets to natural gas — legislation the Senate defeated in March.
“I’m for anything American,” Pickens said. “I want at least to get off the 5 million barrels a day we get from OPEC.”
The most important number may be $70 — the estimated cost to produce a barrel of oil from shale or tar sands, the heart of the new U.S. supplies. While natural-gas prices have sunk, oil prices might not, since they typically follow the cost of producing the most expensive barrel on the market.
Today’s world oil prices of about $111 a barrel are boosted by tensions from Iran’s nuclear program, as well as emerging-market oil demand that will exceed that of developed nations for the first time this year, according to the International Energy Agency. At about $95 a barrel, U.S. oil prices have risen, too, even though the U.S. doesn’t import Iranian crude.
Using the rule of thumb from research firm IHS CERA, that a $10 move in crude changes U.S. gasoline prices by 24 cents a gallon, dropping crude to $70 would lower pump prices about $1, leaving gasoline near $3.
Broad economic impact
Even so, all this new energy is creating jobs across the country. North Dakota, now the nation’s fourth-largest oil producing state, boasts a 3% unemployment rate, the nation’s lowest. In Williamsport, the local economy grew 7.8% in 2010, making it one of the nation’s fastest-growing metro areas.
Projections for energy-related jobs vary, but are all pretty large. More than two-thirds of Citi’s estimated 3.6 million new jobs will come from multiplier effects, as the 550,000 new workers in fossil fuel-related jobs spend their incomes, or as other Americans spend the money they save from cheaper energy, Citi says. IHS Global Insight says the natural-gas boom alone has created 600,000 jobs and will rise to 1.6 million by 2025.
The money saved on energy will pay dividends throughout the economy. Lowering the $400 billion the U.S. sends abroad annually for oil would function like a huge tax cut, says Chris Lafakis, energy economist at Moody’s Analytics.
“A third to 40% would be my guess” at how much the U.S. can cut imports by the next decade, Lafakis says. “At 40%, that’s $160 billion a year, and that’s massive. It’s like the temporary payroll tax cut we have now, plus a third, and it lasts forever.”
A less statistical way to reckon all this is to look at Williamsport.
“It put people to work who hadn’t worked in a long time,” Pennsylvania Gov. Tom Corbett says. “It was a natural-gas rush that put demand on housing, on stores, on restaurants.”
Watching for exaggerations
Yet many hopes — and fears — about the U.S. energy boom will likely prove exaggerated.
Citi’s thesis that gas and oil will stay cheaper in the U.S. than abroad, for example, assumes most exports of U.S. crude remain illegal and natural-gas exports stay rare, says Mark Zandi, chief economist at Moody’s Analytics. Instead, U.S. crude is likely to be refined into exportable products such as gasoline, while infrastructure to export liquefied natural gas improves. Both will pull U.S. prices toward higher world levels, he says.
“Markets have a wonderful way of finding their way around restrictions when there’s money to be made,” Zandi says.
Williamsport exemplifies the likeliest impact of all. With natural-gas prices so low, drilling has all but halted. But gas companies are using the lull to build pipelines, as drilling action moves to oil patches in Western Pennsylvania.
In the meantime, some spinoff industries are coming into focus. Shell has announced plans to build a cracking plant, which will make chemicals from natural gas, outside Pittsburgh. The expected payoff includes 10,000 construction jobs, Corbett says. All this is part of turning the short-term energy boom into a long-term economic plan, he says.
While short-term booms wax and wane, hope persists that the new oil and gas means a better future for Williamsport, and for America.
“They tell us not to worry,” the Chamber’s Matteo says. “The gas isn’t going anywhere and neither are they.”
By: Tim Mullaney
Contributing: Judy Keen
A man makes his way past a replica of a one drachma coin outside the Athens Town Hall May 15, 2012. Yorgos Karahalis / Reuters
Political leaders in Athens were due to discuss an emergency government Wednesday to deal with a possible run on banks as it emerged Greeks withdrew almost $900 million in a single day, fearing their country could crash out of the euro currency by the end of the week.
An interim government would take the country through to new elections on June 17, triggered by the collapse on Tuesday of talks to form a coalition between winners of the inconclusive May 6 election.
Greeks are withdrawing euros from banks, apparently afraid of the prospect of rapid devaluation if the country leaves the European single currency and returns to the drachma.
President Karolos Papoulias warned of “great fear that could develop into a panic,” the minutes of Papoulias’ negotiations with political leaders showed.
The minutes also reveal Papoulias was warned by George Provopoulos, head of the country’s central bank, that savers withdrew at least 700 million euros ($894 million) on Monday.
“Withdrawals and outflows by 4:00 p.m. when I called him exceeded 600 million euros and reached 700 million euros,” the president said according to the minutes of the meeting. “He expects total outflows of about 800 million euros.”
It is not known how much was withdrawn on Tuesday.
The political vacuum in Greece has hampered the country’s chances of making the budget cuts required by the European bailout deal. Without more austerity measures, the flow of bailout money will dry up, raising the prospect of a euro exit with all its wider ramifications.
The likelihood of a Greek exit from the euro – dubbed the “Grexit” by commentators – is now so high that even political leaders committed to avoid it admit preparations are under way.
Asked in an interview whether Greece could leave the euro zone, IMF director Christine Lagarde replied: “We certainly don’t hope so, from the IMF point of view … but we have to be technically prepared for anything”.
Will there be a run on Greek banks?
A Twitter image shared by economics blogger Tyler Durden, posted on UK website Zero Hedge, showed what appeared to lines outside ATMs in Greece, although it was impossible to verify where the picture was taken or if lines were longer than normal.
Reuters reported early Wednesday that there has “so far been no sign” of lines at banks in Athens, despite the likelihood that an exit from the euro would see a dramatic devaluation in of Greek currency.
CNBC’s John Carney raised the prospect of reduced limits on ATM withdrawals, citing a calculation by London analysts Capital Economics that if every working-age Greek withdrew the maximum permitted ATM amount of 300 euros a day, every single deposit of Greek households would be gone within 61 days.
“So the controls put in place in advance of an exit from the euro would have to include not only limits on moving funds abroad, but limiting withdrawals from ATMs and possibly declaring a bank holiday,” Carney wrote.
In practice, however, any Greeks lucky enough to possess any savings have already taken the precaution of withdrawing them from banks.
“Over the last two years Greeks withdrew approximately 70 billion euros from their bank accounts, an amount equivalent to approximately 35 percent of Greek GDP,” Dr Michael Arghyrou, senior economics lecturer at Cardiff Business School in Wales told msnbc.com.
“This is a negative demand shock of enormous proportions and with increased uncertainty this trend will almost certainly accelerate. So yes, we will almost certainly see more deposits withdrawals over the next few days, I just hope is that they will not be so large as to lead to a full-blown bank run.”
How likely is ‘Grexit’? Are drachma notes being printed?
A year ago, it was nearly impossible to get officials and political leaders to talk about the possibility of Greece leaving the eurozone. Now it appears to be an open secret.
Ireland’s central bank chief and European Central Bank policymaker, Patrick Honohan, signaled on Sunday that a Greek exit might not be as painful as previously thought.
“Technically, it can be managed,” he told reporters. “It would be a knock to the confidence for the euro area as a whole … It is not necessarily fatal, but it is not attractive.”
The tone from the European Commission, the EU’s executive, has shifted too.
On Monday, spokeswoman Pia Ahrenhilde-Hansen said: “We wish Greece will remain in the euro and we hope Greece will remain in the euro … but it must respect its commitments. Greece has its future in its own hands and it is really up to Greece to see what the response should be.”
Asked about contingencies, she did not rule them out.
“There are many, many questions arising and many questions open about Greece and most answers have to come from Greece and we have to respect the ongoing political process. Clearly, the future of Greece is in the eurozone. We are working on that.”
However, the official response remains that a Greek exit is not being considered. Richard Corbett, a senior adviser to European Council President Herman Van Rompuy, told BBC Radio 4 on Wednesday: “We’re not planning for a Greek exit, nobody is planning for a Greek exit.”
Some commentators have pointed to a 13 percent rise in the share value of British firm De La Rue, which is the world’s largest currency printer, amid speculation it is best placed to pick up the contract for printing new versions of the drachma, the Greek currency phased out in 2002.
It has remained tight-lipped on whether it is working for the Greek government, but in the meantime an interim solution has been mooted in which existing euro notes would be converted into drachmas by being endorsed by an official stamp.
By: Alastair Jamieson
Reuters contributed to this report.
The nation's debt has nearly tripled in the past decade, and now stands at $15.6 trillion.
(CBS News) WASHINGTON – Republican leaders are laying down a new challenge to President Obama and Democrats over tax cuts and the national debt.
That could mean another ugly confrontation is coming, just in time for the November election.
The two parties are still fighting over the fallout from the last debt debate.
And now, House Speaker John Boehner (R, Ohio) is drawing a new line in the sand, making another showdown over the debt almost inevitable.
Boehner issued the warning Tuesday, declaring, “We shouldn’t dread the debt limit. (As a) matter of fact, I think we should welcome it.”
Boehner sets up another debt limit fight
Boehner says Republicans won’t allow another increase in the nation’s debt limit unless it’s offset by spending cuts, and no tax increases.
“Allowing America to default on its debt would be irresponsible,” he said.
The nation’s debt has nearly tripled in the past decade, and now stands at $15.6 trillion.
Treasury Secretary Timothy Geithner has predicted the U.S. will hit its current borrowing limit of $16.4 trillion by the end of the year.
Congress will have to raise that limit to avoid a damaging default on the nation’s debt payments.
On the campaign trail, Mitt Romney echoed Boehner’s hard line, saying, “Washington has been spending too much money, and our new president made things worse.”
This is the second time Republicans are demanding deep cuts in exchange for their vote to raise the debt limit.
Last summer, a “grand bargain” between Speaker Boehner and the president to cut trillions from the debt fell apart. After weeks of bitter fighting, the two parties passed a bill to prevent default, but still triggered a downgrade of U.S. credit.
Democrats argue Boehner’s latest comments don’t bode well for compromise this time.
“The American people have had enough of this brinkmanship. They want us to get things done,” says Senate Majority Leader Harry Reid (D, Nev.)
Virginia’s Mark Warner, a Democrat, is part of a bipartisan group that’s trying to build support from both sides for a mix of entitlement reforms, spending cuts, and new revenue from taxes.
“I spend a lot of time talking with my colleagues who know in their gut we’ve gotta do this,” Warner says.
Former President Clinton spoke at the same economic forum as Boehner Tuesday and said he’s optimistic that, after the November elections, the two sides will have more incentives to compromise on the debt limit lid.
By: Nancy Cordes
Recent Comments