Saturday, May 31, 2008

Hypocrisy in the name of Democrat Democracy!

The article by Bill Goss was sent to me by a fellow memo reader. Gross writes what I have been trying to say in a far better manner.( See 1 below.)

And this is called news - Iran to be less co-operative. (See 2 below.)

Sever Plocker calls on Olmert to do that which Olmert is most incapable - tell the truth. (See 3 below.)

Hillary was under gunfire, or so she claims, now we find out about Livni and her exploits for Mossad. No doubt this is all being released to buck up Livni's campaign for Olmert's chair. As I wrote earlier( a woman may be elected but not in the U.S. but in Israel.See 4 below.)

It is becoming second thought time regarding Obama's ability to win. The press and media will seek to portray any white backlash as racially based but it is mostly because he is so far outside mainstream American values notwithstanding his oratory to portray himself otherwise.

Also, as I suggested, the Democrats treated the renegade states of Fla. and Michigan, as we did blacks. Citizens of these two states are not whole persons. And I thought the Gore argument was about counting everyone. What hypocrisy in the name of Democrat Democracy. (See 5 below.)


1) Investment Outlook
By Bill Gross


You can fool some of the people all of the time,
and all of the people some of the time,
but you cannot fool all of the people all of the time.
– Abraham Lincoln

What this country needs is either a good 5¢ cigar or the reincarnation of an Illinois “rail-splitter” willing to tell the American people “what up” – “what really up.” We have for so long now been willing to be entertained rather than informed, that we more or less accept majority opinion, perpetually shaped by ratings obsessed media, at face value. After 12 months of an endless primary campaign barrage, for instance, most of us believe that a candidate’s preacher – Democrat or Republican – should be a significant factor in how we vote. We care more about who’s going to be eliminated from this week’s American Idol than the deteriorating quality of our healthcare system. Alternative energy discussion takes a bleacher’s seat to the latest foibles of Lindsay Lohan or Britney Spears and then we wonder why gas is four bucks a gallon. We care as much as we always have – we just care about the wrong things: entertainment, as opposed to informed choices; trivia vs. hardcore ideological debate.

It’s Sunday afternoon at the Coliseum folks, and all good fun, but the hordes are crossing the Alps and headed for modern day Rome – better educated, harder working, and willing to sacrifice today for a better tomorrow. Can it be any wonder that an estimated 1% of America’s wealth migrates into foreign hands every year? We, as a people, are overweight, poorly educated, overindulged, and imbued with such a sense of self importance on a geopolitical scale, that our allies are dropping like flies. “Yes we can?” Well, if so, then the “we” is the critical element, not the leader that will be chosen in November. Let’s get off the couch and shape up – physically, intellectually, and institutionally – and begin to make some informed choices about our future. Lincoln didn’t say it, but might have agreed, that the worst part about being fooled is fooling yourself, and as a nation, we’ve been doing a pretty good job of that for a long time now.

I’ll tell you another area where we’ve been foolin’ ourselves and that’s the belief that inflation is under control. I laid out the case three years ago in an Investment Outlook titled, “Haute Con Job.” I wasn’t an inflationary Paul Revere or anything, but I joined others in arguing that our CPI numbers were not reflecting reality at the checkout counter. In the ensuing four years, the debate has been joined by the press and astute authors such as Kevin Phillips whose recent Bad Money is as good a summer read detailing the state of the economy and how we got here as an “informed” American could make.

Let me reacquaint you with the debate about the authenticity of U.S. inflation calculations by presenting two ten-year graphs – one showing the ups and downs of year-over-year price changes for 24 representative foreign countries, and the other, the same time period for the U.S. An observer’s immediate take is that there are glaring differences, first in terms of trend and second in the actual mean or average of the 2 calculations. These representative countries, chosen and graphed by Ed Hyman and ISI, have averaged nearly 7% inflation for the past decade, while the U.S. has measured 2.6%. The most recent 12 months produces that same 7% number for the world but a closer 4% in the U.S.

This, dear reader, looks a mite suspicious. Sure, inflation was legitimately much higher in selected hot spots such as Brazil and Vietnam in the late 90s and the U.S. productivity “miracle” may have helped reduce ours a touch compared to some of the rest, but the U.S. dollar over the same period has declined by 30% against a currency basket of its major competitors which should have had an opposite effect, everything else being equal. I ask you: does it make sense that we have a 3% – 4% lower rate of inflation than the rest of the world? Can economists really explain this with their contorted Phillips curve, output gap, multifactor productivity theorizing in an increasingly globalized “one price fits all” commodity driven global economy? I suspect not. Somebody’s been foolin’, perhaps foolin’ themselves – I don’t know. This isn’t a conspiracy blog and there are too many statisticians and analysts at the Bureau of Labor Statistics (BLS) and Treasury with rapid turnover to even think of it. I’m just concerned that some of the people are being fooled all of the time and that as an investor, an accurate measure of inflation makes a huge difference.

The U.S. seems to differ from the rest of the world in how it computes its inflation rate in three primary ways: 1) hedonic quality adjustments, 2) calculations of housing costs via owners’ equivalent rent, and 3) geometric weighting/product substitution. The changes in all three areas have favored lower U.S. inflation and have taken place over the past 25 years, the first occurring in 1983 with the BLS decision to modify the cost of housing. It was claimed that a measure based on what an owner might get for renting his house would more accurately reflect the real world – a dubious assumption belied by the experience of the past 10 years during which the average cost of homes has appreciated at 3x the annual pace of the substituted owners’ equivalent rent (OER), and which would have raised the total CPI by approximately 1% annually if the switch had not been made.

In the 1990s the U.S. CPI was subjected to three additional changes that have not been adopted to the same degree (or at all) by other countries, each of which resulted in downward adjustments to our annual inflation rate. Product substitution and geometric weighting both presumed that more expensive goods and services would be used less and substituted with their less costly alternatives: more hamburger/less filet mignon when beef prices were rising, for example. In turn, hedonic quality adjustments accelerated in the late 1990s paving the way for huge price declines in the cost of computers and other durables. As your new model MAC or PC was going up in price by a hundred bucks or so, it was actually going down according to CPI calculations because it was twice as powerful. Hmmmmm? Bet your wallet didn’t really feel as good as the BLS did.

In 2004, I claimed that these revised methodologies were understating CPI by perhaps 1% annually and therefore overstating real GDP growth by close to the same amount. Others have actually tracked the CPI that “would have been” based on the good old fashioned way of calculation. The results are not pretty, but are undisclosed here because I cannot verify them. Still, the differences in my 10-year history of global CPI charts are startling, aren’t they? This in spite of a decade of financed-based, securitized, reflationary policies in the U.S. led by the public and private sector and a declining dollar. Hmmmmm?

In addition, Fed policy has for years focused on “core” as opposed to “headline” inflation, a concept actually initiated during the Nixon Administration to offset the sudden impact of OPEC and $12 a barrel oil prices! For a few decades the logic of inflation’s mean reversion drew a fairly tight fit between the two measures, but now in a chart shared frequently with PIMCO’s Investment Committee by Mohamed El-Erian, the divergence is beginning to raise questions as to whether “headline” will ever drop below “core” for a sufficiently long period of time to rebalance the two. Global commodity depletion and a tightening of excess labor as argued in El-Erian’s recent Secular Outlook summary suggest otherwise.

The correct measure of inflation matters in a number of areas, not the least of which are social security payments and wage bargaining adjustments. There is no doubt that an artificially low number favors government and corporations as opposed to ordinary citizens. But the number is also critical in any estimation of bond yields, stock prices, and commercial real estate cap rates. If core inflation were really 3% instead of 2%, then nominal bond yields might logically be 1% higher than they are today, because bond investors would require more compensation. And although the Gordon model for the valuation of stocks and real estate would stress “real” as opposed to nominal inflation additive yields, today’s acceptance of an artificially low CPI in the calculation of nominal bond yields in effect means that real yields – including TIPS – are 1% lower than believed. If real yields move higher to compensate, with a constant equity risk premium, then U.S. P/E ratios would move lower. A readjustment of investor mentality in the valuation of all three of these investment categories – bonds, stocks, and real estate – would mean a downward adjustment of price of maybe 5% in bonds and perhaps 10% or more in U.S. stocks and commercial real estate.

A skeptic would wonder whether the U.S. asset-based economy can afford an appropriate repricing or the BLS was ever willing to entertain serious argument on the validity of CPI changes that differed from the rest of the world during the heyday of market-based capitalism beginning in the early 1980s. It perhaps was better to be “entertained” with the notion of artificially low inflation than to be seriously “informed.” But just as many in the global economy are refusing to mimic the American-style fixation with superficialities in favor of hard work and legitimate disclosure, investors might suddenly awake to the notion that U.S. inflation should be and in fact is closer to worldwide levels than previously thought. Foreign holders of trillions of dollars of U.S. assets are increasingly becoming price makers not price takers and in this case the price may not be right. Hmmmmm?

What are the investment ramifications? With global headline inflation now at 7% there is a need for new global investment solutions, a role that PIMCO is more than willing (and able) to provide. In this role we would suggest: 1) Treasury bonds are obviously not to be favored because of their negative (unreal) real yields. 2) U.S. TIPS, while affording headline CPI protection, risk the delusion of an artificially low inflation number as well. 3) On the other hand, commodity-based assets as well as foreign equities whose P/Es are better grounded with local CPI and nominal bond yield comparisons should be excellent candidates. 4) These assets should in turn be denominated in currencies that demonstrate authentic real growth and inflation rates, that while high, at least are credible. 5) Developing, BRIC-like economies are obvious choices for investment dollars.

Investment success depends on an ability to anticipate the herd, ride with it for a substantial period of time, and then begin to reorient portfolios for a changing world. Today’s world, including its inflation rate, is changing. Being fooled some of the time is no sin, but being fooled all of the time is intolerable. Join me in lobbying for change in U.S. leadership, the attitude of its citizenry, and (to the point of this Outlook) the market’s assumption of low relative U.S. inflation in comparison to our global competitors.

William H. Gross
Managing Director

Past performance is not a guarantee or a reliable indicator of future results. Investing in the bond market is subject to certain risks including market, interest-rate, issuer, credit, and inflation risk; investments may be worth more or less than the original cost when redeemed. U.S. government securities are backed by the full faith of the government; portfolios that invest in them are not guaranteed and will fluctuate in value. Inflation-linked bonds (ILBs) issued by a government are fixed-income securities whose principal value is periodically adjusted according to the rate of inflation; ILBs decline in value when real interest rates rise. Treasury Inflation-Protected Securities (TIPS) are ILBs issued by the U.S. Government. Commodities contain heightened risk including market, political, regulatory, and natural conditions, and may not be suitable for all investors. Investing in non-U.S. securities involves heightened risk due to currency fluctuations, and economic and political risks, which may be enhanced in emerging markets.

This article contains the current opinions of the author but not necessarily those of the PIMCO Group. The author’s opinions are subject to change without notice. This article is distributed for educational purposes only. Forecasts, estimates, and certain information contained herein are based upon proprietary research and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No part of this article may be reproduced in any form, or referred to in any other publication, without express written permission of Pacific Investment Management Company LLC. ©2008, PIMCO.

2) 'Iran may limit cooperation with IAEA

Iran warned Sunday it may limit cooperation with the UN nuclear watchdog, expressing disappointment over the agency's recent report that was critical of Teheran.

The International Atomic Energy Agency, in a report to the UN Security Council last week, suggested Iran was stonewalling investigators and possibly withholding information crucial to determining whether it conducted research on nuclear weapons.

Iranian Foreign Ministry spokesman Mohammad Ali Hosseini said Sunday the IAEA "could present a better report," adding Iran may have to set "new limits" on its cooperation with the agency.

Iran's newly elected parliament speaker Ali Larijani made a similar threat on Wednesday. Parliament on Sunday elected Larijani, formerly the country's top nuclear negotiator, to the powerful post of speaker for a year.

The choice of Larijani for the influential job boosts his standing ahead of 2009 elections in which he is expected to challenge President Mahmoud Ahmadinejad for the presidency.

There is growing opposition to Ahmadinejad from other conservatives such as Larijani and clerical leaders, partly over his confrontational approach in the nuclear standoff with the West.

Iran is under growing pressure from the IAEA to explain what could be secret nuclear weapons work and it has become increasingly defensive on the issue.

Iran insists its nuclear program is for peaceful purposes.

Iran is resisting a strong IAEA push for answers to allegations it tried to make nuclear arms. It refuses to compromise on the key demand that it stop uranium enrichment.

For years, Iran has shrugged off offers of economic and political rewards in exchange for an enrichment freeze. It has thumbed its nose both at UN Security Council demands that it do so, even after sanctions were imposed, and at veiled US threats of a military action.

Instead, it exploited international indecision and expanded and improved its enrichment capability.

Diplomats said the tone of the IAEA report was unusually tough and reflected deep frustration at Iran's lack of cooperation.

Briefing IAEA board members three days after the report's release, Olli Heinonen - the IAEA's deputy director general in charge of the agency's Iran file - said Iran's possession of nuclear warhead diagrams was "alarming."

Iran remains defiant.

In a statement from its UN Mission last week, Teheran again rejected allegations of an undeclared weapons program as "baseless," "totally false," and aimed at undermining the country's cooperation with the IAEA.

Asked Friday whether the IAEA's new assertiveness was due to US lobbying of the agency, Iranian Foreign Minister Manouchehr Mottaki told the AP that Washington tries "to use any possible capacity as potentiality for their political purposes."

Fears that Iran might want to make the bomb are as old as the discovery five years ago that it had assembled the nuts and bolts of a uranium enrichment program.

Enrichment can turn uranium into the fissile material used in nuclear warheads. But it can also be used to generate power and is allowed under the Nuclear Nonproliferation Treaty.

Iran insists it has a right to enrich uranium.

Starting last year, the IAEA began focusing on probing for evidence of activities that point more directly to a possible clandestine weapons program.

Based on its own information and intelligence from the US and other board members, it has asked - in vain - for substantive explanations for what seem to be draft plans to refit missiles with nuclear warheads; explosives tests that could be used for a nuclear detonation; military and civilian nuclear links and a drawing showing how to mold uranium metal into the shape of warheads.

3) Olmert, tell us the truth
By Sever Plocker

We’ve had enough of the arrogance and lawyers. I’m taking the liberty to offer advice to the prime minister.

Mr. Ehud Olmert, enough with the arrogance. Show some modesty. Enough with the haughtiness. Bow your head. Stop slamming everyone around you. Start showing regret. The act of regret is a difficult one, but the only one that may still save some of your dignity.

Throw away your armor of exaggerated self-confidence. Enough with the attitude of superiority. Show some humility. Be humble.

Stop feeling pity for yourself immediately. Nobody put a gun to your head so that you accept cash-filled envelopes. That was your free choice. You bear full responsibility for this choice. You. Not the circumstances, not the investigation, and not the temptation.

You should know better than anyone that you are not being persecuted or hunted and that you are not subjected to a lynching. The Israel Police has not conspired against you. You were completely free to say “no, thank you” when you received the first envelope containing the money. Yet you said “yes, thank you.” Your hands were the ones that counted the money, not our hands.

Therefore, don’t downplay the immorality of your actions. Deal with it openly, publicly. The Jews are a merciful people. Those who confess are forgiven. Those who do not confess are cursed.

Don’t say: Why are you picking on me, everyone is corrupt, everyone is a thief, and everyone has an American deal-maker who gives them dollars. This is despicable line of defense: It taints many good people just so we won’t see the darkness of your own face. But it will be in vain: We will see it nonetheless.

Instead of hiding behind the backs of real or pretend sinners, declare: Sinning after many have done so does not mean I haven’t sinned.

Be honest this time

For once, show spine. Tell us the truth, Mr. Olmert. Admit: I made a mistake, I was wrong, I misbehaved. I shouldn’t have done so. I lost my restraint. Ask for forgiveness and mercy. Say you’re sorry. Apologize. Simply apologize. Is it that difficult to apologize?

You know, Mr. Olmert, in business ethics courses they teach students how to identify immoral actions. It’s called the “Shabbat dinner test.” If you can fully share with your relatives, your children, and your grandchildren around the table the things you have done, with no shame, then you can be certain that you did not deviate from the rules of natural ethics. But if you cannot tell them your secrets without lying, blurring, distorting, hiding, and stuttering – you committed a moral offence. At the very least.

Change your agenda, Mr. Olmert. Cancel your planned trips. Turn directly to us, the citizens who raise children in this country. Explain your actions to us. You owe us an explanation. You have to talk to your citizens before you speak to Bush or to the court. Without wisecracks or clever answers. Without lawyers and more lawyers.

And above all: Free yourself of the bear hug of your friends and advisors. Enough with the nauseating political tricks. Give up the premiership now. Dedicate yourself to clearing your name. You would be able to reassume a leadership position only if you are clean. Show some class by leaving the Prime Minister’s Office. Set a new norm. This could be your greatest deed.

Be honest this time, Mr. Olmert. Promise us to act modestly. Promise us to bid the past farewell. Promise and deliver. If only we will be exposed to a different Ehud Olmert. I hope there is one like that.

4) Agent Livni makes British headlines

Leading candidate for Kadima chairmanship, potential successor of Prime Minister Ehud Olmert strikes fancy with British newspaper detailing her involvement in pursuing Arab terrorists as part of her past career as Mossad agent

The world is showing an interest in former secret agent Tzipi Livni. The London-based Sunday Times has reported that the foreign minister was a Mossad agent in Paris during the 1980s, when the Israeli intelligence and special operations institute was attempting to assassinate some Palestinian terrorists in Europe.

According to the report, Livni served in the Mossad during the assassination of senior PLO official Mamoun Meraish in Athens in August 1983. The ‘Times’ claims Livni was not directly involved in the assassination, during which Meraish was shot dead by a squad of two motorcycle riders, yet her Mossad activities have remained a mystery.

A short while after that, Livni left the Mossad to complete her law degree. The British newspaper known to be fond of Israeli security affairs, has published a profile article on the leading candidate to replace Prime Minister Ehud Olmert. The paper also uses quotes from surveys published in Israel over the past weekend, showing Livni has a good chance of being elected for chairmanship of the Kadima Party during its primaries.

Livni’s past as a Mossad agent is a well-known fact, but the ‘Times’ adds a few other details that have never been published. According to the publication, while Livni was based in Paris, she participated in chasing Arab terrorists throughout Europe.

“Tzipi was not an office girl,” said an acquaintance. “She was a clever woman with an IQ of 150. She blended in well in European capitals, working with male agents, most of them ex-commandos, taking out Arab terrorists.”

The profile article notes that the legacy of the Livni family is intertwined with the struggle to establish the State. Both her parents were arrested during the 1940s, as part of the Jewish underground movements’ fight against the ruling British Mandate.

5) Fears grow that Obama can't win
By Paul Harris

Analysts believe white working class Democrats will defect to McCain if Clinton is not the nominee

With senator Barack Obama poised this week to clinch his party's nomination for President, there are growing fears in some quarters that the Democratic party may not be choosing its strongest candidate to beat Republican John McCain.

Senator Hillary Clinton has been making that argument for weeks. Now some recent polls and analysis, looking particularly at vital battleground states and support among white voters, have bolstered her case - even as Obama looks certain to become the nominee.

Obama supporters reject this argument and point to his record of boosting Democratic voter turnout, especially among the young. But sceptics in the party, already nervous about nominating Obama after the furore over outspoken pastor Jeremiah Wright, are growing increasingly concerned. 'There is an element of buyer's remorse in some areas. The question is whether it gets really strong now or in September - or even after the election is over, if he loses,' said Steve Mitchell, head of political consultancy Mitchell Research.

Another boost to Clinton's case came late last week after a pro-Obama preacher gave a race-tinged rant against her at Obama's church in Chicago. In a recent sermon Michael Pfleger - a long-term Obama backer who is white - mocked Clinton as an entitled white person angry at a black man having beaten her. His angry, red-faced speech, in which he mimicked Clinton weeping, was played repeatedly across American cable channels and the internet.

The news sent shock waves through Democratic circles; many had hoped Obama had put 'pastor problems' behind him. 'It is more of the same problem as Wright. It reinforces the image among some voters that Obama does not share their values,' said Mitchell.

The uproar also lent a disturbingly antagonistic tone to scenes in Washington DC where Clinton and Obama supporters gathered yesterday outside a party rules meeting called to resolve the problem of the disputed Michigan and Florida primaries, which Clinton claims as victories. Clinton supporters chanted 'Count our votes!' and waved placards and banners. Clinton wants those states' delegations seated at the Denver convention, even though they broke party rules by holding early contests.

Obama is now to some extent limping to the finishing line. Clinton's refusal to bow out even though her odds of victory have become almost impossible has seen her win several of the most recent contests. In fact, since 4 March, Clinton has won around half a million more votes than Obama. That run of victories should easily continue today when Puerto Rico goes to the polls, and could even extend to the final primaries - South Dakota and Montana - which vote on Tuesday. Obama had been expected to win there, but Clinton has been campaigning furiously and it could be close.

Clinton has been making the case for several months, as her support has grown stronger among white working class voters, that those voters will not support Obama in a general election. By contrast, experts believe Obama's core - educated Democrats and blacks - will remain loyal to the party no matter who the nominee is. There is strong data to back that up, especially from recent votes in West Virginia and Kentucky where large proportions of Clinton voters said they would not back Obama in November.

There is also a growing fear that many of the women backing Clinton are turning against Obama. Clinton and her supporters have controversially accused their rival, and the media, of being misogynistic in the last few weeks of the race. A recent Pew Poll showed Obama's support among white women collapsing from 56 per cent to 43 per cent.

But the electoral fact remains the same. The dramatic Obama vs Clinton contest is now down to a few hundred uncommitted party 'superdelegates', who are under huge pressure to make their decisions in the next few days. Senior party figures, including House Speaker Nancy Pelosi, have been working privately to convince them to make that decision as soon as possible, ideally this week. With Obama's delegate lead unassailable, the vast majority are almost certain to come over to his side.

Republican analysts, meanwhile, are surprised about how healthy their party's prospects look in a year when almost all indicators suggested they should lose. McCain remains competitive against Obama. He even leads in some key states. Indeed, some research predicts he could romp home against Obama.

It is that prospect, Clinton supporters say, that leads them to keep fighting. They point to Obama's performance in North Carolina as a bellwether: it was his strong win there earlier this month that dealt an almost fatal blow to Clinton's chances. Yet, two weeks after that win, polls showed Clinton easily outperformed Obama there when measured against McCain. 'Clinton has a very strong argument that she is a stronger candidate against McCain. It is just that it has fallen on deaf ears,' said Mitchell.

Friday, May 30, 2008

An experienced plumber vs an inexperienced president.

He who hesitates. (See 1 below.)

Now the denial. (See 2 below.)

Olmert's demands for speaking or appearing are small compared to "Ole" Bill's who gets around $1/2 million. (See 3 below.)

Wm Tate suggests McClellan was manipulated by his publisher as well. Maybe McClellan can now write the history of the pretzel. (See 4 below.)

Jackie Mason on Obama. (See 5 below.)

David Frum writes GW got the servants he deserved but agrees he did not deserve Scott McClellan.

Without perhaps realizing it, Frum raises an interesting issue I have often thought about and discussed. Any president has the entire nation's collective talent to call upon but they generally build staff choosing among campaign loyalists or former cronies. Carter did it and looked what happened. How does/should a president go about hiring the best when he owes so much to those who helped him get there? (See 6 below.)

Democrats want to stop at the water's edge of victory and retreat to the defeat island? Lead Wall Street Journal Editorial regarding al Qaeda's dire and worsening position. (See 7 below.)

Lanny Davis demonstrates loyalty and fights the good fight for Hillary and the Clinton Mafia. (See 8 below.)

But then, Newsweek's pre-eminent whiner, Eleanor Clift, tells Hillary to stop whining and realize you lost. (See 8 below.)

Florida and Michigan will learn whether Democrats believe they are still part of the Union this weekend. Like we initially and despicably treated blacks in our Constitution it appears the issue will be resolved by considering citizens of these two states as half-citizens. (See 9 below.)

Have a great weekend.


1) Hamas threatens Gaza escalation while PM Olmert plans Washington trip

Israeli prime minister Ehud Olmert has scheduled a consultation on the lingering Gaza missile crisis with defense minister Ehud Barak and foreign minister Tzipi Livni for Sunday, June 1 before taking off Monday for a week of talks in Washington.

The prime minister is traveling in the face of rising pressure for him to step down over the corruption scandal hanging over his head. Both Barak and Livni have openly supported this demand.

The three leaders have been warned repeatedly by Israel’s military and intelligence chiefs that the longer effective action against Hamas and its allied terrorist groups is delayed, the harder and more costly in lives the operation will be.

Mahmoud A-Zahar, speaking for Hamas in an interview Saturday, May 31, threatened that if Israel rejects his group’s ceasefire terms in Gaza and refuses to end its blockade, “the Palestinians will resort to all means at their disposal including armed force.”

Saturday, the Egyptian police reported the discovery of 30 anti-air missiles in a large arms cache in Sinai 80 km. south of the Gaza Strip. It also contained rifles, 2,000 rifle rounds, sacks of hand grenades and RPGs. The weapons were to have been smuggled into Gaza through tunnels. Police are investigating their source.

Palestinians sources add: Hamas’ truce offer is a take-it-or-leave-it proposition through Cairo; it has no intention of halting the ongoing build-up of its Iran- and Syria-backed war machine or controlling fellow terrorist groups’ attacks on Israeli locations neighboring on the Gaza Strip.

Saturday morning, a Hamas activist blew himself up and injured 16 family members and passers-by while handling explosives at his home in Gaza City.

Five missiles were fired at civilian locations Friday causing damage but no injuries.

Seven Palestinians were injured Friday when Israeli soldiers broke up a second mass assault organized by Hamas to smash through the Gaza-Israel border – this one at the southern Sufa crossing.

2) Syria denies accord with Israel on core issues

Dr. Samir Taki, a close aide of Syrian president Bashar Assad, denied reports that Syrian-Israeli peace talks had reached the point of discussing core issues of water, borders, security and normal relations. In an interview with the Kuwait Al-Anba, Dr. Taki added that the talks were only just beginning and not yet matured.

3) Olmert's memo: If you want me, pay for 'first class' hotels, flights
By Gidi Weitz

There was a form in Ehud Olmert's bureau, which was sent out to the various organizations that financed his trips abroad and stipulated the conditions of his lodgings. The document, which was made available to Haaretz, states that the organization inviting Olmert must underwrite a suite in a 'first class' hotel, preferably one in which cigar smoking is permitted. The hotel has to be equipped with a gym.

Olmert's flights, too, always had to be first class. Indeed a flight that he took in February 2005, while serving as industry and trade minister, to a dinner in Palm Beach, Florida, to participate in an event organized by the March of the Living organization with his friend Avraham Hirchson, cost about $20,000. In September 2004, he flew to New York for two days at the expense of the mogul Edmundo Safdie, to attend a reception. The cost of the first-class ticket: $7,600.

On October 2, 2005, while serving as vice prime minister and finance minister, Olmert flew to Washington for a short trip with his wife, Aliza, who was exhibiting a collection of her art in the American capital under the title 'Tikkun' (which in Hebrew means 'repairing' or 'restoring'). Morris Talansky paid about $4,700 for the couple's three-night stay in a hotel.

This is not the first time Mrs. Olmert's paintings have been mentioned in a police investigation. In 1991, her husband was investigated on suspicion of having accepted illegal donations for the Likud's 1988 election campaign, when he was the party's treasurer. During the questioning, in a police facility, the interrogators surprised Olmert by asking, according to the files: "In November 1988, your wife, Aliza, and one of your children went to the United States. What was the purpose of their trip?"

Olmert: "A private trip."

Interrogator: "Who paid for the trip?"

Olmert: "Generally, I pay for my family's or my own private trips."

Interrogator: "Was that trip paid for by Likud funds?"

Olmert: "I am astounded by the question. I never dealt with the technical side of payment for my trips. That is always done by my assistant, Shula Zaken, who is in ongoing contact with the travel agency and debits my account according to need. I would imagine that if there was a problem regarding a payment, she would have told me, but I never heard anything like that from her, and I never asked for Likud funds to be used to pay for a private trip of mine or of anyone else in my family. I suggest you ask Mrs. Zaken."

Heeding Olmert's recommendation, the police summoned Zaken, then the bureau chief of health minister Ehud Olmert, for questioning on June 13, 1991, at the headquarters of the National Fraud Investigations Unit. They showed her evidence that the Olmert family's trip was paid for with funds suspected of passing through the Likud coffers. "I know about that trip, I handled the arrangements," the loyal bureau chief replied. "I remember it well, because the trip was intended for one of Mrs. Olmert's exhibitions abroad. It was a private trip to exhibit paintings in New York."

Zaken denied paying for the trip in cash. Her explanation of the trip being financed by Likud funds was that there had been confusion in the travel agency between payment for the private trip of the Olmerts and payment for trips abroad by senior Likud officials. This episode was part of the investigation of the alleged fictitious receipts affair, for which Olmert was tried in 1996, and acquitted.

A month ago, when Olmert was questioned by the police in the Talansky affair, he again suggested that the interrogators ask Zaken for answers concerning the money he received from the American businessman. This time Zaken preferred to invoke the right to remain silent.

In February 2006, a month before the elections in which Olmert became prime minister, Zaken celebrated her 49th birthday at an extravagant party held in an Eilat hotel. The event was organized by her good friend Simu Tubol, a Jerusalem businessman. Zaken also invited other close friends, such as attorney Uri Messer, cabinet secretary Oved Yehezkel, former Jerusalem city engineer Uri Sheetrit and others. The group went on a cruise, danced and enjoyed a festive meal.

Afterward they all gathered at the hotel. Zaken took a microphone and told her friends, as she wiped away a tear, "I thank you for viewing my job as a mission, as I myself view it. What I want most is to see Ehud sitting in the chair."

A few months after Olmert was elected prime minister, officers of the Fraud Investigations Unit came to Zaken's home in the early morning and interrogated her at the unit's headquarters. Zaken was suspected of having promoted the candidacy of Jacky Matza as head of the Israel Tax Authority, in return for which he would give her friends key jobs in the authority. Among other things, Zaken was questioned on suspicion that she had asked Matza to intervene in a criminal proceeding against Tubol, who had organized her birthday party in Eilat.

In his court deposition this week, Talansky said it was Zaken who called him in New York to ask him to prepare money for Olmert, and that it was she who received most of the envelopes of cash from him. She also documented in her computer the cash transfers on several occasions. Zaken is far from the grotesque caricature of her portrayed on the satirical television program 'A Wonderful Country.' She is both smart and politically savvy.

In 1999, Olmert effectively supported the election of Labor Party chairman Ehud Barak as prime minister by declaring publicly in a Jerusalem hotel that, "Barak will not divide Jerusalem." Zaken had been opposed to Olmert's support for Barak, so much that she tried to stop him physically from going to that event. Olmert's statement was prominent in all of Barak's television ads and was extremely harmful to the campaign of then prime minister Benjamin Netanyahu, head of the Likud. Zaken was, in fact, prescient: A few months later Olmert was trounced by Ariel Sharon in the battle for the Likud leadership; the party faithful accused Olmert of betraying both Netanyahu and the party.

Zaken accompanied Olmert for 30 years, handled his private accounts and was even able to tell him, at the beginning of 2005, that he had NIS 2 million in his bank account. She also reminded him every year to call Talansky on his birthday to wish him well.

One of Zaken's friends recently recalled that when she asked Zaken, a month after Olmert's election as prime minister, what she was up to, she replied without hesitation: "I am appointing cabinet ministers." Fraud unit personnel obtained printouts from Zaken's bank accounts in order to trace money transfers from Talansky. "I am ready to swear that Zaken did not get money from Talansky," one of her close friends said this week. "If she got into trouble, it was only because she did not understand the limits of power."

Since being questioned in the Talansky affair, she has hardly left the house. Her relations with Olmert have soured. Since the tax authority case she has complained frequently that the boss is not devoting enough time and attention to her.

In November 2005, the new finance minister, Ehud Olmert, flew to New York to attend the celebration of his grandson's circumcision. In the morning, a heavyset, white-haired man wearing a black skullcap arrived at the reception desk of the luxury Regency Hotel and asked the clerk where a "Mr. Risby" was staying. He then took the elevator up to the suite and knocked on the door.

The door opened and his old friend, Ehud Olmert, embraced the visitor, Talansky, warmly. "He asked for a loan of $15,000," Talansky recalled this week in his deposition to the Jerusalem District Court. Talansky said he went to a Citibank branch near the hotel, withdrew the money, put it in a bank envelope and gave it to Olmert. He said he told Olmert that he wanted the money back soon.

Olmert denied having received the money when he was questioned by the police. A police check revealed that the date of his stay in New York coincides with the date on which Talansky withdrew the amount of money he testified about.

On the eve of Olmert's trip, his bureau asked the Israeli consulate in New York to organize working meetings for him. Thanksgiving was imminent, and the consulate could only set up a few of them, in Olmert's hotel suite. The Finance Ministry told Haaretz this week that Olmert's flight on that occasion, costing some NIS 19,000, was paid for by the state. He also received expenses. Because of the meetings, Olmert's bureau turned a private trip into a working visit, paid by the state. In reply to a question from Haaretz, Olmert's bureau said this week, "The matter is under investigation and will be clarified in the future." Talansky was not invited to the circumcision ceremony, and in his deposition said he was deeply hurt by this.

In that same month, November 2005, in which Talansky allegedly handed the fat envelope to Olmert, Olmert sent a letter to billionaire Sheldon Adelson asking him to assist Talansky's mini-bar business. Olmert sent another letter to the defense minister of Chile, Jaime Ravinet de la Fuente, asking him to assist ImageSat, a company that markets satellite imagery, in which Talansky is an investor. In his letter, published here for the first time, Olmert wrote: "Dear Minister Ravinet, I was very pleased to learn from Mr. Shimon Eckhaus, CEO of ImageSat International, about your meeting and the possible joint space program with Chile. We in Israel have recognized that imaging satellite [sic] is a perfect subject for dual-use applications. The Israeli Ministry of Defense is one of ImageSat customers and I hope that Chile will join us as well and benefit from our vast experience in this field. If I can be of any further assistance in any way, please do not hesitate to contact me. With kind regards, Sincerely, Ehud Olmert." Talansky stated in court that he did not ask Olmert to write this letter.

One meeting appearing on the itineraries of Olmert's trips to New York, which were found by the police, is a get-together with Talansky in a fancy restaurant called Thalassa, in Tribeca on November 2, 2004, at 2:45 P.M. The restaurant specializes in lobster and organic food and has a 5,000-bottle wine cellar. The timetable shows that the Olmert-Talansky meeting lasted only 15 minutes: At 3 P.M., Olmert was to meet his son Shaul and another person for lunch in the same restaurant.

Talansky stated in court this week that 15 minutes was the time Olmert usually allotted him. But when interrogators asked him about the restaurant meeting, he denied it altogether. "Thalassa? How do you spell it?" he asked, adding that he does not frequent nonkosher restaurants. Olmert also denied the meeting took place.

A few days before the officers from the fraud squad showed up unexpectedly at his house at 6 A.M. and took Talansky for questioning, the American businessman met with attorney Uri Messer. Talansky told the police that Messer had tried to find out from him whether he had been questioned by the police about his relations with Olmert. Messer stated in his interrogation that it was in fact Talansky who told him he had been questioned in the United States about the matter, and tried to find out if he, Messer, knew anything. Messer said he asked Talansky to leave immediately.

In his deposition, Talansky related that he had met Messer in New York before and through him had twice delivered envelopes of cash to Olmert. Talansky said that when he sent money to finance Olmert's election campaigns, Messer recommended that he split the donation - which exceeded the limit allowed under Israeli law - into several checks, from members of Talansky's family. Messer denied having making such a suggestion.

In 1999, $300,000 was transferred from Talansky's private account, for which Messer had power of attorney, as a bond to cover the debt run up by United Jerusalem, the list under which Olmert ran for mayor. The bond was forfeited in 2002. The differences between the Talansky and Messer versions concerning this episode are reported here for the first time.

When Talansky was asked by interrogators if he knew that money from his private account had been transferred to the account of the United Jerusalem association through Messer, he reacted furiously: "He used my money? He will go to jail if he did that. He will be disbarred. I have to talk to my lawyer. I am in shock!" When Messer was asked by the police if he had informed Talansky before deciding on the forfeiture of the bond to cover the election debts, he replied, "Of course. The forfeit occurred only in 2002. I informed him both beforehand and afterward. To your question, he reacted with disappointment. He did not like that at all, and I did not like it, either, I did not want it to happen and I made many efforts to avoid it."

Can one reasonably assume that Talansky did not know that hundreds of thousands of dollars had been withdrawn from his account? Is it possible the money that was transferred belonged to someone else? If so, who is behind this very large sum? Was Talansky's account used as a straw account? And what is Olmert's involvement in this matter?

The Talansky affair emerged from a police investigation that dealt with the give-and-take relations between Olmert and attorney Uri Messer. In August 2006, Haaretz Magazine published a report that exposed for the first time Olmert's actions as industry and trade minister on behalf of Messer's clients. It was not until October 2007, more than a year later, after much vacillation and delay, that Attorney General Menachem Mazuz ordered an investigation into the suspicions raised by the Haaretz article and by the harsh report issued by the State Comptroller's Office on the same subject. The police seemed to be in no rush to thoroughly investigate the sensitive information it possessed from the beginning about the Olmert-Talansky ties.

In March 2008, the Fraud Investigations Unit was about to wrap up the Olmert-Messer affair and send the file to the State Prosecutor's Office for a final decision. Already then the police team had evidence that Olmert actively assisted Messer's clients and also promoted a grant of tens of millions of shekels to one of the companies Messer represented. Additional evidence showed that for years Messer supplied Olmert with political and legal services free of charge or for low fees.

One of the police officers who saw memos about the money transfers Zaken recorded in her computer, was certain that those involved would have explanations for them. "They will tell us that it's from the sale of a private property," he said. It is clear today that if Mazuz had not waited so long before deciding to launch an investigation into the suspicions against Olmert, the Talansky affair would have come to light already a year ago.

4)Soros Publisher 'Shaped' McClellan's Hit Job: Other publishers don't recognize it as the same book
By William Tate
An examination of published reports reveals that Scott McClellan's kiss-and-smell betrayal of George W. Bush is a far cry from the book McClellan started out to write and was shaped into an offensive tome by a publisher with close ties to George Soros.

To understand how McClellan's literary knife-in-the-back evolved, one has to know something about the book industry.

Unlike fiction, a non-fiction book usually hasn't been written before it's sold to a publisher. The author normally puts together an outline and/or synopsis detailing what the book will be about and how it will be structured, and writes 1-3 sample chapters to show the author's writing ability. The author's agent then shops the proposal around to prospective publishing houses.

The agent actually lands the deal, so the choice of agents is crucial. Any author normally starts at the top of the A list and works his or her way down until--or if--they find an agent with whom they can work. According to an Associated Press article,

"McClellan's book does not fit the pattern of Washington megadeals. He was not represented by Washington, D.C., attorney Bob Barnett, whose clients include Tenet and countless political leaders, but by the much less known Craig Wiley, whose most famous client is actor Ron Silver."

Not to slight Mr. Silver, a gifted talent, but that's hardly the reaction one would expect to a proposal promising the kind of sensational accusations which have created a media furor and catapulted McClellan's book to the top of Amazon's charts. Oh, and put quite a bit of coin in Messrs. McClellan and Wiley's pockets. Agents are paid on a percentage of sales basis. The more controversial and sellable they think the book will be, the more likely they are to take it on.

Nor did publishers see enough in the proposal to jump at the chance to publish it.

"It was shopped around but, like others who publish in the category, we didn't even take a meeting...." said Steve Ross, who was head of the Crown Publishing Group at Random House Inc. at the time McClellan was offering his manuscript. This in an industry that, just like newspapers, appears to be dying a slow death at the hands of new media, print-on-demand, and other modern technologies, and is desperate for books that can add substantial numbers to the bottom line.

Again, agents start at the tope of the food chain and work their way down. McClellan finally reached a deal with PublicAffairs, which according to the AP "specializes in policy books by billionaire George Soros" and others.

Further, the unwritten book wasn't published based upon McClellan's proposal. "(Public Affairs founder Peter) Osnos said he didn't even read the proposal" the article reports. Instead, Osnos "sought out people who knew McClellan and said they regarded him as an honest man unhappy in his job."

In other words, Osnos didn't look at the proposal of the book McClellan wanted to write; he was more interested in confirming that McClellan was disgruntled with the White House.

PublicAffairs editor Lisa Kaufman confirmed to the AP that the proposal McClellan shopped around was nothing like the book that plunges the knife into his benefactor's back. "The original proposal was somewhat general," Kaufman admits, "so before making an offer on the book we talked to Scott at some length."

It takes little imagination to gather how the conversation between George Soros's publisher and a disgruntled former Bush administration official hawking his unwritten memoirs, still unsold after having gone through the tope tier of publishers, went.

But imagination isn't needed.

A book's editor and its author work extremely closely--with the author sweating over every word, every detail, and the editor helping shape the pacing and overall tone of the manuscript. Kaufman told the AP that as McClellan wrote the book the "tone began to be directed toward issues and events that some people would rather he not be straightforward and candid about." (Emphasis added.)

PublicAffairs reportedly paid McClellan a $75,000 advance. An advance is the only part of an author's financial deal with a publisher that's guaranteed. It is literally an advance on the author's royalties. If the book sells enough copies that the author's royalties exceed the advance, the author will make more money.

Some have argued that McClellan's small advance negates the financial incentive as a reason for McClellan to bring forward these charges, when the opposite is true. When George Tenet or Bill Clinton are offered millions in advances, they've already made their money. The books will probably not "earn out" (pay the author more than the advance) no matter how many copies are sold. With a small advance, the author is under pressure to sell as many copies as possible.

With only a $75,000 advance, and working with a publisher and editor who were more interested in producing a book written by a disgruntled former Bush staffer than they were in the book McClellan had proposed, McClellan had every financial incentive to give them exactly the book they wanted.

And he apparently did.

According to the AP article, "Rival publishers say they had no sense that McClellan would make such explosive observations."

Could that be because the proposal McClellan presented them, the book he set out to write before financial pressures and a left-wing publisher took over, didn't contain them? And how is the public now expected to believe them?

5) Sometimes even paranoids have something to be paranoid about
By Jackie Mason & Raoul Felder

Did you hear the one about the Jew who says to his psychiatrist that he believes the psychiatrist is plotting his destruction? The psychiatrist tells him that he has a sick delusion and should not worry, since the psychiatrist is there to protect him. The poor jerk is happy until he looks up at the diplomas on the wall and sees the psychiatrist's middle name is Hussein, and a diploma from a Muslim school.

Forget Reverend Wright, Obama's twenty-year mentor who preached racial hate and America-hate. Forget that he was Obama's spiritual advisor, baptized his children, and counseled with him for twenty years. Forget that Obama says he sat there for twenty years and never heard any of it and never spoke to — for twenty years — the hundreds of thousands of people who sat in church with him and also never heard any of them mention the sermons to him, or heard any of them speak to each other about the sermons. Perhaps he has a hearing problem and, if you believe him, perhaps you would like to buy this bridge that we would like to sell you on eBay.

OK, also forget Obama's lack of experience, although any reasonable person must be just a little concerned by this. If we were to hire a plumber to fix our toilet, we would want to make sure he had experience fixing toilets. For a plumber — yes. For a president — not necessary.

While we are forgetting, also forget Michelle Obama, who says this is the first time in her life she has ever been proud of America. But even she would have to admit that we do some things well, like Broadway shows, making cornflakes, taking out gallbladders, and fixing teeth. The whole world would admit we do these things better than anybody else. The next time she needs a cavity filled, maybe she wants to look up a dentist in Czechoslovakia. Grab a piece of paper and make a list of the things we do better than any other country in the world — no, grab a whole notebook because you will soon run out of paper.

So now, we come to Jews. We would be the first to admit that there are plenty of Jews we don't like, but as a race, we would fight for their survival. And, admittedly, the principal enemy against their very survival is the militant Muslims.

Israel is just 60 years old, a drop in the bucket of historical time, but Jews have lived in Israel for over 3,300 years, 1,800 years before the Arabs ever showed up with their goats and soldiers. Jerusalem was the Jewish capital for all of these 3300 years and was never the capital of any Muslim or Arab state. In the Second World War the Jews fought both the Nazis and the Arabs. The Arabs fought the Jews and supported the Nazis.

In 1947 the United Nations created both Jewish and Arab states. The Jews abided by this mandate, five Arab armies attacked Israel. The Arabs told the Palestinians to leave Israel, and when they followed instructions, their fellow Arabs put them in camps where they still remain to this day. Many times since 1947, through multiple accords, the Palestinians have been offered a separate state next to Israel. They and the Arab leaders have always refused this. Instead — whether they be al Qaeda, Ahmadinejad, the Islamic Jihad, Hamas, Hezbollah — they have consistently called for the destruction of Israel. Ahmadinejad threatens Israel with nuclear weapons and calls it a "stinking corpse," and supplies arms to terrorists, Kasam rockets rain down on Israel, Hamas threatens Israel's destruction, religious Fatwahs are issued.

All of this gives us at least the right to say that, as lawyers do, the burden of proof shifts to the man whose middle name is Hussein and who was educated in a Muslim school, to demonstrate that he is committed to the preservation of Israel. He has every right in our country — a country that his wife has never, until now, been proud of — not to be so committed. But Jews have every right not to support him or vote for him until he meets his burden of proof.

And, oh yeah, if you know any experienced plumbers, give us a call. There are still some jobs where experience counts.

6)David Frum on Scott McClellan's new book: George Bush got the team he deserved

Except maybe for MSNBC’s wild-eyed commentator Keith Olbermann, nobody in politics or media seems to have a good word to say for Scott McClellan, the former George W. Bush press secretary turned ferocious Bush critic.

The right complains of McClellan's disloyalty. The left complains that McClellan’s change of heart arrived too late. The old Washington hands shake their heads at a press secretary writing a book at all: FDR’s and Eisenhower’s men took their secrets to their graves — why cannot today’s whippersnappers do the same?

Yet there is something very sad and sympathetic about McClellan and the bitter, accusatory memoir that leaked out this week. (The book, What Happened: Inside the Bush White House and Washington’s Culture of Deception, has hit number one on’s sales chart despite the fact that it won’t be officially released till next week.)

If you ever watched McClellan’s televised confrontations with the savage White House press corps, you probably thought: This is terrible! The man has no business being up there. He looks frightened, like a schoolboy trying to retrieve his mittens from a persecuting gang of bullies. His words stumble and clomber. When he has good news to announce, he cannot elicit any interest; when the news is bad, his clumsy efforts to evade questions only draw more attention than ever.

As the current press secretary Dana Perino daily reminds us, you don’t have to be a genius to succeed as press secretary. But you do need (1) composure under fire, (2) verbal fluency, (3) an understanding of the imperatives of the news business and (4) access to the interior workings of the administration. McClellan never possessed qualities (1) and (2), and his colleagues refused to grant him (4).

In these deficiencies, McClellan was not alone. George W. Bush brought most of his White House team with him from Texas. Except for Karl Rove, these Texans were a strikingly inadequate bunch. Harriet Miers, Alberto Gonzalez, Karen Hughes, Al Hawkins, Andy Card (the last not a Texan, but a lifelong Bush family retainer) — they were more like characters from The Office than the sort of people one would expect to find at the supreme height of government in the world’s most powerful nation. McClellan, too, started in Bush’s governor’s office, and if he never belonged to the innermost circle of power, he nonetheless gained closer proximity than would be available to almost anyone who did not first serve in Texas.

That early team was recruited with one paramount consideration in mind: loyalty. Theoretically, it should be possible to combine loyalty with talent. But that did not happen often with the Bush team.

Bush demanded a very personal kind of loyalty, a loyalty not to a cause or an idea, but to him and his own career. Perhaps unconsciously, he tested that loyalty with constant petty teasing, sometimes verging on the demeaning. (Robert Draper, whose book Dead Certain offers a vivid picture of the pre-presidential Bush, tells the story of a 1999 campaign-strategy meeting at which Bush shut Karl Rove up by ordering him to “hang up my jacket.” The room fell silent in shock — but Rove did it.)

These little abuses would often be followed by unexpected acts of thoughtfulness and generosity. Yet the combination of the demand for personal loyalty, the bullying and the ensuing compensatory love-bombing was to weed out strong personalities and to build an inner circle defined by a willingness to accept absolute subordination to the fluctuating needs of a tense, irascible and unpredictable chief.

Had Bush been a more active manager, these subordinated personalities might have done him less harm. But after choosing people he could dominate, he then delegated them enormous power. He created a closed loop in which the people entrusted with the most responsibility were precisely those who most dreaded responsibility — Condoleezza Rice being the most important and most damaging example.

Yet as the proverb warns us, even worms will turn.

For three years, Bush left Scott McClellan in a position for which he was unsuited and in which he must have suffered terrible anxiety and stress. Finally, McClellan was deputed to act as the administration’s shield and buffer in the Valerie Plame leak case. The administration had nothing to fear from the truth, but McClellan was assigned to say things that later proved untrue. Understandably, he feels terrible bitterness about the episode — and predictably, a book publisher offered him the opportunity to exact his revenge.

The lesson of this story is emphatically not that presidents should seek staffers even more fanatically loyal than Bush’s. The lesson is that weak personalities break under pressure. And since a White House is the world’s highest-pressure environment, a wise president will seek to staff it with strong personalities.

To recruit and hold strong personalities, a president must demand something more than personal loyalty. He must offer a compelling vision and ideal — a cause that people can serve without feeling servile. Otherwise a president will only get … what Bush has now got.

7) REVIEW & OUTLOOK: Al Qaeda on the Run

A year ago in July, a National Intelligence Estimate warned that al Qaeda had "protected or regenerated key elements of its Homeland attack capability," meaning it could be poised to strike America again. The political reaction was instantaneous and damning. "This clearly says al Qaeda is not beaten," said Michael Scheuer, the former CIA spook turned antiterror scold.

What a difference 10 months – and a surge – make.

CIA Director Michael Hayden painted a far more optimistic picture in an interview yesterday in the Washington Post. "On balance, we are doing pretty well," he said. "Near strategic defeat of al Qaeda in Iraq. Near strategic defeat for al Qaeda in Saudi Arabia. Significant setbacks for al Qaeda globally – and here I'm going to use the word 'ideologically' – as a lot of the Islamic world pushes back on their form of Islam."

What happened? To certain sophisticates, this is all al Qaeda's doing: By launching suicide attacks on Shiite and even Sunni targets, and ruling barbarically wherever they took control, the group has worn out its welcome in the Muslim world.

There's some truth in this. The Sunni Awakening in Iraq was in part a reaction by local clan leaders against al Qaeda's efforts to subjugate and brutalize them. The Arab world took note when Abu Musab al-Zarqawi ordered the November 2005 bombing of three hotels in Amman, Jordan, in which nearly all of the victims were Sunni Arabs. Extremist Islamic parties took an electoral drubbing in Pakistan's elections earlier this year following a wave of suicide bombings, one of which murdered Benazir Bhutto.

It's also true that al Qaeda finds itself on the ideological backfoot, even in radical circles. As our Bret Stephens reported in March, Sayyed Imam, a founder of Egyptian Islamic Jihad and once a mentor to Ayman al Zawahiri, has written an influential manifesto sternly denouncing his former comrades for their methods and theology. This was enough to prompt a 215-page rebuttal from Zawahiri, who seems to have time on his hands. Lawrence Wright in the New Yorker and Peter Bergen and Paul Cruickshank in the New Republic have recently written about similar jihadist defections.

But the U.S. offensives in Afghanistan and especially Iraq deserve most of the credit. The destruction of the Taliban denied al Qaeda one sanctuary, and the U.S. seems to have picked up the pace of Predator strikes in Pakistan – or at least their success rate. This has damaged al Qaeda's freedom of movement and command-and-control.

As for Iraq, Zawahiri himself last month repeated his claim that the country "is now the most important arena in which our Muslim nation is waging the battle against the forces of the Crusader-Zionist campaign." So it's all the more significant that on this crucial battleground, al Qaeda has been decimated by the surge of U.S. forces into Baghdad. The surge, in turn, gave confidence to the Sunni tribes that this was a fight they could win. For Zawahiri, losing the battles you say you need to win is not a way to collect new recruits.

General Hayden was careful to say the threat continues, and he warned specifically about those in Congress and the media who "[focus] less on the threat and more on the tactics the nation has chosen to deal with the threat." This refers to the political campaign to restrict wiretapping and aggressive interrogation, both of which the CIA director says have been crucial to gathering intelligence that has blocked further terrorist spectaculars that would have burnished al Qaeda's prestige.

One irony here is that Barack Obama is promising a rapid withdrawal from Iraq on grounds that we can't defeat al Qaeda unless we focus on Afghanistan. He opposed the Iraq surge on similar grounds. Yet it is the surge, and the destruction of al Qaeda in Iraq, that has helped to demoralize al Qaeda around the world. Nothing would more embolden Zawahiri now than a U.S. retreat from Iraq, which al Qaeda would see as the U.S. version of the Soviet defeat in Afghanistan.

It is far too soon to declare victory over al Qaeda. Still, Mr. Hayden's upbeat assessment is encouraging, and it suggests that President Bush's strategy of taking the battle to the terrorists is making America safer.

8) The Argument for Nominating Hillary

After the votes are in from Puerto Rico tomorrow and South Dakota and Montana on Tuesday, neither Barack Obama nor Hillary Clinton will be able to make a facts-based case that they represent a significant majority of grass-roots Democrats.

Chances are Sens. Obama and Clinton will virtually split the more than 4,400 delegates – including Florida and Michigan – elected by more than 34 million people over the past five months.

Sen. Clinton has already won the most votes, but there is controversy over including the over 300,000 votes from Michigan, since Sen. Obama was not on the ballot (by his own choice). But if Sen. Clinton wins a substantial victory in Puerto Rico tomorrow – with an expected record turnout exceeding two million voters – she could well end up with more popular votes than Sen. Obama, even if Michigan's primary votes are excluded.

Worst case, she could come out with a 2% deficit in elected pledged delegates. But that gap can be made up, if most of the remaining 200 or so unpledged superdelegates decide to support Sen. Clinton as the strongest candidate against John McCain – or if others committed to Sen. Obama decide to change their minds for the same reason. A number of superdelegates previously committed to Sen. Clinton later announced support for Sen. Obama, so it's certainly possible that, when confronted with growing evidence that Sen. Clinton is stronger than Sen. McCain, they might switch back.

The final argument for Hillary comes down to three points – with points one and two leading to the third.

First, Sen. Clinton is more experienced and qualified to be president than is Sen. Obama. This is not to say Sen. Obama cannot be a good, even great, president. I believe he can. But Sen. Clinton spent eight years in the White House. She was not a traditional first lady. She was involved in policy and debate on virtually every major domestic and foreign policy decision of the Clinton presidency, both "in" and "outside" the room with her husband. She has been a U.S. senator for eight years and has a record of legislative accomplishments, including as a member of the Senate Armed Services Committee.

With no disrespect or criticism intended, Sen. Obama has been an Illinois state senator for eight years and a U.S. senator for just four years. He has, understandably, fewer legislative accomplishments than Sen. Clinton. That's just a fact. Therefore, it is reasonable to argue that Sen. Clinton would be less vulnerable to criticism from Sen. McCain on the "experience" issue.

Second, Sen. Clinton's position on health care gives her an advantage over Sen. McCain. Her proposal for universally mandated health care based primarily on private insurance and individual choices is a stark contrast to Sen. McCain's total reliance on private market insurance, HMOs or emergency rooms for the 45 million or more uninsured. Sen. Obama's position, while laudable in its objective, does not mandate universal care and, arguably, won't challenge Sen. McCain as effectively as will Sen. Clinton's plan.

Despite the fact that Sen. Obama's campaign made the Iraq war a crucial issue in the Iowa caucuses and early primaries, there has never been a significant difference between his position and Sen. Clinton's. Sen. Obama deserves credit for opposing military intervention in Iraq while he was running for the state senate in early 2002.

But in 2004, Sen. Obama said he "did not know" how he would have voted on the war resolution had he been a senator at the time. That summer he told the Chicago Tribune: "There's not much of a difference between my position and George Bush's position at this stage" of the Iraq War. (This is a statement that Sen. Clinton would not have made.) While he served in the Senate, he voted 84 out of 85 times the same as Sen. Clinton on Iraq-war related votes. The only exception is when he supported President Bush's position on the promotion of a general that Sen. Clinton opposed.

Third and finally, there is recent hard data showing that, at least at the present time, Sen. Clinton is a significantly stronger candidate against Sen. McCain among the general electorate (as distinguished from the more liberal Democratic primary and caucus electorate).

According to Gallup's May 12-25 tracking polling of 11,000 registered voters in all 50 states plus Washington, D.C., Sen. Clinton is running stronger against Sen. McCain in the 20 states where she can claim popular-vote victory in the primaries and caucuses. In contrast, Sen. Obama runs no better against Sen. McCain than does Sen. Clinton in the 28 states plus D.C. where he has prevailed. "On this basis," Gallup concludes: "Clinton appears to have the stronger chance of capitalizing on her primary strengths in the general election."

The 20 states, Gallup points out, not only encompass more than 60% of the nation's voters, but "represent more than 300 Electoral College votes while Obama's 28 states and the District of Columbia represent only 224 Electoral College votes." Sen. Clinton leads Sen. McCain in these 20 states by seven points (50%-43%), while Sens. Obama and McCain are pretty much tied. But in the 26 states plus D.C. that Sen. Obama carried in the primaries/caucuses, he and Sen. Clinton are both statistically tied with Sen. McCain (Clinton 45%-McCain 47%; Obama 45%-McCain 46%).

Gallup's state-by-state polling in seven key battleground "purple" states also shows Sen. Clinton winning cumulatively in these states by a six-point margin (49%-43%) over Sen. McCain, while Sen. Obama loses to Sen. McCain by three points – a net advantage of 9% for Sen. Clinton. These key seven states – constituting 105 electoral votes – are Nevada, Pennsylvania, Ohio, New Mexico, Arkansas, Florida and Michigan.

Meanwhile, Sen. Obama holds about an equal advantage over Sen. McCain in six important swing states that he carried in the primaries and caucuses – Colorado, Oregon, Minnesota, Iowa, Wisconsin and Missouri. But these constitute less than half – 54 – of the electoral votes of the larger states in which Sen. Clinton is leading.

The latest state-by-state battleground polls (published May 21-23) by other respected polling organizations verify Gallup's findings that Sen. Clinton is significantly stronger against Sen. McCain in the key states that a Democrat must win to gain the presidency. According to various poll data within the last 10 days:

- Pennsylvania: Sen. Clinton leads McCain 50%-39%; Sen. Obama and Sen. McCain are effectively tied.

- Ohio: Sen. Clinton leads Sen. McCain 48%-41%, Sen. Obama is down 44%-40%.

- Florida: Sen. Clinton leads Sen. McCain 47%-41%; Sen. McCain leads Sen. Obama 50%-40%. (Sen. Clinton has a net advantage of 16 points!)

- North Carolina: Despite a substantial primary victory, Sen. Obama is down 8% vs. Sen. McCain, (51%-43%), while Sen. Clinton leads by 6% (49%-43%).

- Nevada: Sen. Clinton up 5%, Sen. Obama down 6%.

Even the theory that Sen. Obama can open up significant numbers of "red" states has not been borne out by recent polling. For example: in Virginia, which Sen. Obama won substantially in the Feb. 12 Democratic primary, he is currently down in at least one recent, respected poll by a significant 9% margin – one point greater than the 8% margin Sen. Clinton is behind Sen. McCain.

Finally, one unfortunate argument is making the rounds lately to convince superdelegates to go for Sen. Obama. That is the prediction that if Sen. Obama is not the nominee, African-American and other passionate Obama supporters will conclude that the nomination had been "stolen" and will walk out of the convention or stay at home. On the other side are the many women and others strongly committed to Sen. Clinton promising that if she is denied the nomination, they will refuse to vote for Sen. Obama.

Barack Obama and Hillary Clinton are progressive, pro-civil rights, pro-affirmative action, pro-choice Democrats. Neither Obama supporters nor Clinton supporters who care about the issues, the Supreme Court, and the need to begin withdrawing from Iraq can truly mean they will actively or passively help Sen. McCain get elected. Threats of walkouts or stay-at-homes by good Democrats are not the answer, nor should they be a factor in superdelegate decisions.

But there is one possible scenario that avoids disappointment and frustration by passionate supporters of both candidates, that combines the strengths of one with the strengths of the other, and that virtually guarantees the election of a Democratic president in 2008:

A Clinton-Obama or an Obama-Clinton ticket.

Stay tuned.

8) Hillary, You Didn’t Win. Now Don’t Whine
By Eleanor Clift

The sense of grievance that permeates the Clinton campaign hurts her and the Dems.

The key to the winner winning is how the loser loses. Those cautionary words were spoken some weeks ago by Rep. Rahm Emanuel, who is close to both the Clintons and Barack Obama and whose hardball style of politics helped win back the House for the Democrats. However the nomination fight is resolved, it must be seen as fair by supporters of the two candidates, who have run an excruciatingly close race.

If that's the goal, it doesn't help that a group of women plan on protesting outside the hotel Saturday where the Democratic Party's rules and bylaws committee is meeting. These women are mad as hell and aren't going to take it anymore. But their complaint, that Hillary Clinton may be denied the nomination because she's the victim of sexism, doesn't hold water.

Sexism by whom? By the press? By Barack Obama? To be sure, there have been sexist comments. Some women are still smarting over the time when Obama pulled out Clinton's chair after a debate, seeing it as chauvinist as opposed to gentlemanly. But highlighting sexism undercuts Clinton's argument that she is the more electable of the two candidates. How can she be more electable if sexism is this strong within the Democratic primaries? What would happen in November? If she's the candidate, would hordes of men see the light?

Clinton discovered her inner feminist late in the race, when mobilizing women was one of the last cards she had left to play. Women of her generation have experienced the indignities of an oppressed minority (even though women are more than half the population), and they rallied to her cause. A classmate of Hillary's from Wellesley told me she never considered herself a feminist: "I never marched … but this campaign turned me into one." She is furious about the Hillary nutcracker, which has stainless steel thighs and is available for purchase at the newsstand at many airports.

Younger women do not feel the lash of gender the way their elders wish they would. Professor Karen O'Connor teaches a weekend course on women and politics at American University. Her course this year coincided with the primary season, and to show how a caucus works she asked Hillary supporters to assemble on one side of the room, Obama supporters on the other, with undecided students in the middle. In the class of 25 there were only three men, and O'Connor assumed, wrongly as it turned out, that the pro-Hillary forces would dominate. Three female students stood up for Hillary, 17 students backed Obama, and five were undecided.

O'Connor founded the Institute of Women and Politics at AU. As a woman over 50 who has devoted her professional life to cultivating women leaders and looking ahead to the day when she might see a woman president, she learned a hard truth: that for these women, youth trumps gender. "I don't vote for a woman just because she's a woman," a former student told O'Connor. "I do," O'Connor responded, explaining that Clinton and Obama are "identical" on the issues. "This is gender versus race." O'Connor has been quoted saying it will be generations, plural, before another woman will be positioned as the heir apparent the way Clinton was at the outset of the race.

Blaming gender bias may help some women vent about an outcome they didn't want, but there are more mundane reasons for what looks like a failed nomination fight. If Clinton had not voted for the resolution that gave President Bush the authority to wage war, the door would not have swung open for Obama to enter the race. His antiwar stance gave him a moral claim on which to stake his candidacy. Secondly, the Clinton campaign's decision to not aggressively contest the caucus states allowed Obama to build up a lead in delegates that Clinton was never able to overcome. Now Clinton supporters are arguing that caucuses are undemocratic, and if only the Democrats had the same system as the Republicans, winner-take-all in the big primary states, Hillary would be the nominee.

The sense of grievance that permeates the Clinton campaign is out of proportion to reality. Women seethe at the way Hillary's cleavage became news when a Washington Post style writer, a woman, did a feature on a lower-cut-than usual top she wore on the Senate floor. Silly and sexist, yes, but what if Bill Clinton hadn't waded into the South Carolina primary with remarks that seemed to conjoin Obama with Jesse Jackson? Would that have made a difference? Life isn't fair, but don't cry for Hillary. She's proved herself more than worthy to win; now she's got to muster the grace to lose.

9) Democrats Meet Today To Hash Out Fla., Mich.
By Dan Balz

When Democratic Party leaders voted on Aug. 25, 2007, to sanction Florida Democrats for moving up the date of their presidential primary, no one anticipated that the decision would lead to a tense showdown that will help decide the outcome of the nomination battle between Sens. Barack Obama and Hillary Rodham Clinton.

Today, the 30 members of the Democratic National Committee's Rules and Bylaws Committee will hear challenges to that decision and a later ruling, which together barred delegations from Florida and Michigan from the national convention in Denver because those states violated the party's rules governing the nomination process

Democrats on and off the committee said yesterday that a compromise appears likely that would restore half of the delegations from each state, although the precise terms remained under discussion. "It's clear something's going to be worked out," said Carol Fowler, the party chair in South Carolina and a member of the rules committee. Fowler is also an Obama supporter but was not speaking for the campaign.

Among the unresolved issues is how to allocate the delegates between the two candidates, particularly delegates from Michigan, where Clinton's name was on the ballot in the Jan. 15 primary but Obama's was not. There was growing talk yesterday that the committee could agree to split the state's delegates evenly between Clinton and Obama, a blow to Clinton.

In determining the allocation of delegates from Florida, the committee appears likely to use the results of the state's primary on Jan. 29.

Clinton will gain more delegates than Obama under almost any outcome, but there is widespread agreement that nothing the committee is likely to do will change the nomination battle's trajectory, which now has Obama moving steadily toward victory.

But after months of sparring and bad feelings between the two camps, the real question is whether both sides -- and the two states -- are prepared to accept what the committee decides, or will instead take their grievances to the party's credentials committee next month or possibly to the convention in August.

"What's at stake is whether this nominating process will come to a quick conclusion in a way that unifies the party, or whether it will drag on for weeks and perhaps months in a way that threatens party unity and potentially hurts the nominee and the party," said Tad Devine, a Democratic strategist and veteran of rules battles.

Clinton will send her team to today's meeting with a demand that the full delegations from both states be seated in Denver, that each of those delegates be given a full vote and that the delegates be allocated strictly on the basis of the results of the two primaries. But while she has drawn a hard line in the pre-meeting maneuvering, her advisers stopped short yesterday of threatening to take the fight beyond today.

"We think it's not useful to cross streams before we come to them," said Harold Ickes, who oversees Clinton's delegate operations and is also a member of the DNC's rules committee.

The story of how the Democrats got to this moment is a tale of personal egos, state pride, institutional integrity and raw political maneuvering. Its beginning dates back many years, and is rooted in competition between political leaders in Michigan, led by Sen. Carl M. Levin, who think their state should have a larger role in the nominating process; and those in New Hampshire, who have zealously guarded their state's first-in-the-nation primary.

Levin, who will present Michigan's case today, said in an interview Thursday night that he is prepared to carry on the fight if his state's full delegation is not seated in Denver with full voting rights, arguing that any other outcome would be appealed to the credentials committee.

Levin has proved to be a skilled and relentless proponent of dislodging New Hampshire and Iowa from what he sees as their privileged position as the states that kick off the nominating calendar. He was the catalyst behind the creation of a commission, authorized at the 2004 Democratic convention, to study and reform the nominating calendar for 2008.

The commission met for a year and ended up reaffirming Iowa's and New Hampshire's traditional roles. It also proposed adding Nevada and South Carolina to the early round of voting to encourage regional and ethnic diversity. But the panel, in a decision blessed by the rules committee, stated its determination to keep other states from scheduling their contests before Feb. 5, 2008.

In Florida, however, Republicans in control of the governor's mansion and the legislature decided to move the state's primary from Feb. 5 to Jan. 29, to break away from what was becoming a virtual national primary of nearly two dozen states. How hard Democrats resisted remains in dispute. State Democratic Chair Karen L. Thurman said: "We didn't have the votes to [block] it. No matter what happened, this bill would have become law."

Florida's move triggered a reaction from Republicans in South Carolina, who were determined to preserve their tradition of holding the first Southern contest of significance. They announced they would shift their contest from Feb. 2 to Jan. 19.

Katon Dawson, the sometimes flamboyant South Carolina GOP chair, made the announcement in New Hampshire. Standing with him at that Aug. 9 news conference was New Hampshire Secretary of State William Gardner, who said the decision would trigger his state's law requiring that its primary be held a week before any similar contest. That meant New Hampshire's primary would be, at a minimum, more than a week before the DNC had established in its original timetable.

Two weeks later, the party's Rules and Bylaws Committee voted to bar Florida's delegation from the convention.

Levin marks the Dawson-Gardner news conference as the trigger for his state's decision to move its contest from Feb. 9 to Jan. 15. In his view, Michigan had agreed to abide by the DNC's calendar, provided all other states did, as well.

Once New Hampshire indicated it would move, Michigan indicated it would do the same -- and on Dec. 1, 2007, the DNC's rules committee barred Michigan's delegates from the convention. Levin contends that New Hampshire should have been sanctioned as well for moving its date, but party officials say New Hampshire had the authority to do what it did.

The Republican National Committee, dealing with a similar problem, cut violating states' delegations in half and moved on. The Democrats, determined to send a tough message to other states that might have been contemplating further moves up the calendar, inflicted the maximum penalty of a total ban.

Eager to please the early states, particularly Iowa and New Hampshire, the Democratic presidential candidates agreed in September to a request from party chairs in those two states, as well as in South Carolina and Nevada, that they not campaign in Michigan or Florida. A month later, Obama and several other Democrats removed their names from the Michigan ballot. Clinton did not.

Speaking to New Hampshire Public Radio, Clinton said: "It's clear, this election they're having [in Michigan] is not going to count for anything. But I just personally did not want to set up a situation where the Republicans are going to be campaigning between now and whenever, and then after the nomination, we have to go in and repair the damage to be ready to win Michigan in 2008."

Still, even at the end of last year, few Democrats, including the candidates, anticipated how much these decisions would come back to haunt them. They assumed that there would be an early resolution of the nomination battle and that the nominee, in a magnanimous act, would agree to seat the delegations.

Clinton won Michigan with 54 percent of the vote. The choice of "Uncommitted" was second, with 40 percent. In Florida, all names remained on the ballot, and Clinton won with 50 percent to Obama's 33 percent. About 1.7 million people voted in Florida's primary and about 600,000 in Michigan's, though the candidates did not campaign in either state.

Soon after it became clear that every contest could be crucial to the outcome of the Democratic race, Clinton seized on the two states, in part to bolster her contention that she won more popular votes, even though she trailed in the delegate count. Obama accused her of trying to change the rules.

Now it is left to the same committee that imposed the original sanctions to find a solution that preserves the DNC's power to police its nominating process, and one that still finds peace between the warring campaigns and with two key battleground states.

A dolt was manipulated. DUH! Rally 'round Obama!

Edmund Wright blames GW's current grief on GW's belief in his own ability to charm and cites the retention of Scott McClellan as proof.

The WSJ editorial connects McClellan's new book to a publisher with an ax to grind and agenda to mount and Peggy Noonan defends McClellan on the basis that we need more first hand accounts so historians have grist for their mills. I have Doug Feith's book and look forward to reading it. There is no comparison between the intellectual capacity of Feith and McClellan.

As for McClellan's book, he has every right to write a book and make some money assuming his timing is legitimate, which, in this case, I suspect it is not. If it is, he really is a bigger and duller dolt than Wright sees him to be. Why? Because it took McClellan three years to conclude he was duped and manipulated. Hell, the modern press secretary's job, sad as it may be, is all about defending and putting the best face on things. That is subtle manipulation.

FDR was a pro at manipulation as was JFK. Clinton was as well and was ably assisted by an adoring press which has now become increasingly embarrassed so they are now trashing Hillary which is easy to do because she is her own worst enemy. All presidents must resort to manipulation considering the vast array of forces that are arraigned against their succeeding. That is our system for better or worse.

It is ironic that McClellan finally discovered he had become, by his own admission,part of the manipulation process. DUH!(See 1, 1a and 1b.)

Kimberley Strassel advises McCain to run against another "Do Nothing Congress." Truman did it and won and perhaps McCain could as well. Truman also had an opponent whose mustache played a big role in his defeat as well as a picture of him fishing on a boat tied to the dock. Dewey never caught on outside of New York.

Certainly McCain will be blocked at every turn if he should win and then tries to be true to any conservative philosophy still left in his bones. The only way McCain will succeed is to meet Reid and Pelosi more than half way and on their terms because the Republicans probably won't have enough votes, after the election, to shelter him from any philosophical storm.

Congress will most likely continue to rule the next president and in their hands Obama will be putty and sharp left turns will become an ordinary occurrence.

Limbaugh may be correct in suggesting a McCain victory will simply prolong the Republican Party's shift away from Conservatism and make the rebuilding process, if there is to ever be one, longer in coming. Perhaps we are moving towards having two Liberal parties - one for real (Democrats) and one Liberal Light (Republicans).

As I recently pointed out when you accept another person's premise in the mistaken belief you can then massage it and alter it you are dead from the git go. You cannot agree with what someone says if you do not accept the premise on which what they say is based. You cannot buy their tree's leaves and ignore the roots.

Obama talks one way and acts the other when it comes to staffing and support for Israel, but then that seems to be a pattern governing much of what he says and then does. (See 2 below.)

New Polosi strategy is to move for quick nomination. Very Democratic of this Democrat. Avoiding a party brouha is more important than allowing the game to be played to its conclusion . At the same time Democrats are trying to deflect the controversy Obama continues having with ministers from his church's pulpit by typing Hagee to McCain. World of difference but politics is politics.

I suspect Pelosi and Reid will eventually regret their strong arm tactics because it is likely to build more resentment than calm the troubled waters. What Pelosi and Reid are doing is displaying back room politics out in front for all to see.

Obama realizes he in the position of walking a tight rope and is now about taking his message to Hillary supporters while her body is warm and yet to be buried. That might be seen as over-reaching and arrogance on his part and could back-fire but Pelosi and Reid, who have performed so brilliantly in their respective job as evidenced by Congress' rating even below GW's, are certain time will knit the raveled sleeve of care and party faithfuls will rally round Obama's tattered flag.(See 3 below.)

1) Blame Bush for McClellan
By C. Edmund Wright

Has there ever been as much chatter among the pundits about someone as light weight, un-talented, inconsequential (and utterly predictable) as Scott McClellan? I mean, who was he again? Oh yeah, that boring, un-engaged pasty little white dude who mumbled through the daily press briefings after Ari Fleisher and before Tony Snow. I remember him now. I used to wonder how in the world it was that the President found someone so totally unimpressive to help fight his media battles.

Then I remembered: McClellan was a more appropriate as Press Secretary for the New Tone President than either his predecessor or successors. After all, the New Tone (which is short for uni-lateral surrender to your political enemies) logically leads to Presidential front man who is totally ineffective. Allow me to present exhibit A: Scott McClellan.

And now the verdict is in. McClellan and the New Tone can both be declared unequivical disasters. In a 50-50 country, it takes some real doing to have a 26% approval rating. That's sort of like 38 over par on a putt-putt course. It is unimaginably bad and McClellan was part of the team that crafted it.

So bad, in fact, that the Prez actually had to let him "pursue other opportunities." (In the real world, we call that "firing." In Washington, it means writing a vindictive tell all book). For one of the Texas gang to screw up so badly that they had to be jettisoned says something...since this is a President who would ride Texas loyalty straight to the bottom of the political abyss. For some reason he valued that loyalty over his Presidency...and oh by the way the country. Still, McClellan was so ill suited that he was canned anyway.

And now Bush and his inner circle are "shocked" that Scottie would do this to them. And they were shocked that Ted Kennedy did not like them after they let him write the education bill. Shocked that their new tone never did work in charming the likes of Pelosi and Reid and Daschle and Durbin and Schumer, not to mention Matthews and Rather and Williams and Gibson.

They are all shocked because one thing has been consistent about this President: his "misoverstimation" of his own charm and its effect on those around him -- political allies and enemies alike. This misoverstimation is the psychosis behind the New Tone, the Kennedy Education Bill, looking into the soul of Vladimir Putin, the whole misguided concept of "compassionate conservatism"....and the belief that elevating little worms like McClellan to heights far beyond what their talents merit will be repaid with kindness.

I actually did like the President at one time, but started finding him hard to stomach when the New Tone appeared. I was insulted (horrified, actually) that Bush didn't understand that conservatism is compassion and that "compassionate conservatism" is actually liberalism. I never liked Kennedy's education bill or thought he would like us for it. I never trusted Putin as someone we can "do business with."

And I never thought McClellan was worth a damn. I am not surprised that he's now cashing in on his former position with this post defacto "harrmph" of indignation. Afterall, in the real world, folks who are elevated beyond their capabilities do one thing predictablly when they start to slip in stature; they sell whoever and whatever down the river to maintain their status, because they surely cannot do it on their own talent. McClellan may no longer be welcome in the Oval Office, but he's a star in Keith Olbermann's green room.

Consider: this presidency reached a point in 2001 and 2002 where the President was winning battles because his opponents "mis underestimated" him. Now it is crashing and burning at the finish because he is mis-overestimating himself. And an argument can be made that he's taking the party and the country down with him. Frankly, that Texas charm is wearing a bit thin.


But Is It True?
May 30, 2008

Leave him alone. He wrote a book. It is true or untrue, accurately reported or not. If not, this will no doubt be revealed. It is honestly meant and presented, or not. Look to the assertions, argue them, weigh and ponder.

That's my first thought. My second goes back to something William Safire, himself a memoirist of the Nixon years, said to me, a future memoirist of the Reagan years: "The one thing history needs more of is first-person testimony." History needs data, detail, portraits, information; it needs eyewitness. "I was there, this is what I saw." History will sift through, consider and try in its own way to produce something approximating truth.
[But Is It True?]
Scott McLellan, during a daily briefing as White House press secretary, 2005.

In that sense one should always say of memoirs of those who hold or have held power: More, please.

Scott McClellan's book is the focus of such heat, the target of denunciation, because it is a big story when a press secretary breaks with a president. This is like Jody Powell turning on Jimmy Carter, or Marlin Fitzwater turning on Reagan. That is, it's pretty much unthinkable. And it's a bigger story still when such a person breaks with his administration not over many small things but one big thing, in this case its central and defining endeavor, the Iraq war. The book can be seen as a grenade lobbed over the wall. Thus the explosive response. He is a traitor, turncoat, betrayer, sellout. If he'd had any guts he would have spoken up when he was in power.

I want to quote his defenders, but he doesn't have any.

Those in the mainstream media who want to see the president unmasked, who want to see the administration revealed as something dark, do not want to be caught cheering on the unmasker.

The left, while embracing the book's central assertions, will paint him as a weasel who belatedly 'fessed up. They're big on omertà on the left. It's part of how they survive.

The right will—already has—pummel him for disloyalty. But those damning him now would have damned him more if he'd resigned on principle three years ago. They—and the administration—would have beaten him to a pulp, the former from rage, the latter as a lesson: This is what we do when you leave ugly.

And Americans in general have a visceral and instinctive dislike for what Drudge called a snitch. This is our tradition, and also human nature.

So Mr. McClellan defends himself in the same way he defended the administration, awkwardly. He could not speak earlier because he did not oppose earlier; he came to oppose with time and on reflection. He is trying, now, to tell the truth.

He is a man alone, "a pariah," as Matt Lauer put it.

He does not appear to have written his book to bolster his reputation. He paints himself as a loser. "I didn't stay true to myself"; he loved "the theatre of political power" and "found being part of the play exciting"; he tried to play "the Washington game" and "didn't play it very well." But soon the mea culpa becomes a you-a culpa.

He has nothing to say, really, about the world he entered, about what it was to be there. His thoughts present themselves as clichés. Working in the White House is "a wow." Seeing it lit up at night "never got old." He'll never forget where he was on 9/11. He claims he was taught to "communicate" by Karen Hughes. This is all too believable. I did learn that the word visit— "Got a moment to visit?"—is apparently Texan for "I'm about to kill you" or "Let's conspire."

The book is not quite a kiss-and-tell, smooch-and-blab or buss-and-bitch. It is not gossipy, or fun, or lively. It is lumpy, uneven and, when he attempts to share his historical insights—the Constitution, he informs us, doesn't mention the word "party"— embarrassing.

And yet the purpose of the book is a serious one. Mr. McClellan attempts to reveal and expose what he believes, what he came to see as, an inherent dishonesty and hypocrisy within a hardened administration. It is a real denunciation.

He believes the invasion of Iraq was "a serious strategic blunder," that the decision to invade Iraq was "a fateful misstep" born in part of the shock of 9/11 but also of "an air of invincibility" sharpened by the surprisingly and "deceptively" quick initial military success in Afghanistan. He scores President Bush's "certitude" and "self-deceit" and asserts the decision to invade Iraq was tied to the president's lust for legacy, need for boldness, and grandiose notions as to what is possible in the Mideast. He argues that Mr. Bush did not try to change the culture of the capital, that he "chose to play the Washington game the way he found it" and turned "away from candor and honesty."

Mr. McClellan dwells on a point that all in government know, that day-to-day governance now is focused on media manipulation, with a particular eye to "political blogs, popular web sites, paid advertising, talk radio" and news media in general. In the age of the permanent campaign, government has become merely an offshoot of campaigning. All is perception and spin. This mentality can "cripple" an administration as, he says, it crippled the Clinton administration, with which he draws constant parallels. "Like the Clinton administration, we had an elaborate campaign structure within the White House that drove much of what we did."

His primary target is Karl Rove, whose role he says was "political manipulation, plain and simple." He criticizes as destructive the 50-plus-1 strategy that focused on retaining power through appeals to the base at the expense of a larger approach to the nation. He blames Mr. Rove for sundering the brief post-9/11 bipartisan spirit when he went before an open Republican National Committee meeting in Austin, four months after 9/11, and said the GOP would make the war on terror the top issue to win the Senate and keep the House in the 2002 campaign. By the spring the Democratic party and the media were slamming back with charges the administration had been warned before 9/11 of terrorist plans and done nothing. That war has continued ever since.

Mr. McClellan's portrait of Mr. Bush is weird and conflicted, though he does not seem to notice. The president is "charming" and "disarming," humorous and politically gifted. He weeps when Mr. McClellan leaves. Mr. McClellan always puts quotes on his praise. But the implication of his assertions and anecdotes is that Mr. Bush is vain, narrow, out of his depth and coldly dismissive of doubt, of criticism and of critics.

If that's what you think, say it. If it's not, don't suggest it.

When I finished the book I came out not admiring Mr. McClellan or liking him but, in terms of the larger arguments, believing him. One hopes more people who work or worked within the Bush White House will address the book's themes and interpretations. What he says may be inconvenient, and it may be painful, but that's not what matters. What matters is if it's true. Let the debate on the issues, not the man, commence.

What's needed now? More memoirs, more data, more information, more testimony. More serious books, like Doug Feith's. More "this is what I saw" and "this is what is true." Feed history.

1b) Women Scorned
By E. J. Dionne

WASHINGTON -- How much anger is there among women about how Hillary Clinton has been treated during this campaign? Some of the nation's leading female politicians will tell you: quite a lot.

"From the beginning, she's been treated very badly," says Therese Murray, the president of the Massachusetts Senate. "No woman would have run with Obama's resume. She wouldn't have been considered." But Clinton has been "demonized by the press and the talking heads. How do you get away with that?"

Rep. Debbie Wasserman Schultz, D-Fla., says she is regularly approached "by women of all races, of all ages, of all faiths. They stop me, grab my hand and say, 'Look what they've done to her, we were so close.' They wanted this for their daughters and granddaughters. ... It's so heartbreaking."

For Rep. Darlene Hooley, D-Ore., the symbol that "sexism reigns supreme" was in the wide availability of offensive anti-Hillary paraphernalia in stores and on the Internet. For Barbara Johnson, president of the Minneapolis City Council, Clinton may have been the victim of "ageism" as much as sexism. The message, she said, was: "Your time is past, it's time for somebody new to take your place."

Many women, said Rep. Ellen Tauscher, D-Calif., "knew we had made many strides. They asked, 'Aren't we past this? What's going on?' They're not happy with what they see as sexism, permitted by the media and in some cases encouraged by the media."

If there is good news for Barack Obama in any of this, it is that the rage felt by Clinton's female supporters is directed in large part toward the media. "The anger is aimed much more at you all," said Lt. Gov. Elizabeth Roberts of Rhode Island. Added Murray: "Obama wouldn't have gotten to where he got today if it weren't for the bias of the male media -- no offense."

It's true that campaigns and political movements use anger as a bargaining chip. The message is: Appease us or we will cause trouble. The Clinton campaign is hoping that such rage will strengthen its hand in the battle to seat pro-Clinton Michigan and Florida delegations at the party's national convention, even though those states held early primaries in violation of party rules.

But the conversations I had this week with prominent female politicians from around the country who support Clinton suggest that the fury and disappointment is about more than short-term maneuvering. In many cases, it is rooted in the empathy of women who themselves broke gender barriers at various levels of politics.

Murray, for example, is the first woman to lead the Massachusetts Senate. Hooley was the first woman on the City Council in West Linn, Ore., and the first woman elected as a commissioner of Clackamas County. Johnson says proudly that she is the second woman to serve as president of the Minneapolis City Council. Her mother was the first.

"She (Clinton) is striking a chord among women who have been involved in politics for a long time and who have been waiting for a long time," said Nancy Kopp, Maryland's treasurer.

Female politicians feel for Clinton as someone who regularly faces questions male politicians would never be asked. When a reporter queried Roberts about "my brand of lipstick and what color was it," she revealed the vital information -- "Revlon Number 235" -- but noted that "some of my supporters were offended that she asked me."

These are professional politicians, so they know that Clinton is on the verge of defeat because of her campaign's organizational mistakes, its failure to take Obama seriously early on, and the difficulties created by her husband's presence. Roberts points to an age split among women, noting that her 19-year-old daughter Kathleen is a staunch Obama supporter. Obama, Kopp said, clearly has a strong appeal "among younger women, though that's true among many older women, too."

Indeed, Obama has the support of many prominent female elected officials, notably Sens. Claire McCaskill of Missouri and Amy Klobuchar of Minnesota, and Govs. Janet Napolitano of Arizona and Kathleen Sebelius of Kansas. He won significant female support in the primaries, carrying a majority of the women's vote in 13 states and splitting it evenly with Clinton in Wisconsin.

Nonetheless, even these very pragmatic female politicians who very much want a Democrat to win the White House are looking for signs of "understanding and respect," said Kopp.

"It's a campaign, someone wins, someone doesn't win, that's life," she said. "But women don't want to be totally dissed."

2) Bonior Joins Obama Team as Latest Anti-Israel Campaign Official

The Obama campaign announced former Rep. David Bonior will be representing them at the Democratic National Committee meeting this weekend in Washington, D.C. As a Congressman, David Bonior was known for his strong opposition to pro-Israel policies, being called by some "the biggest supporter of the anti-Israel Arab lobby in Congress."[1] Bonior is the latest in a string of advisors and campaign officials to Barack Obama that harbor anti-Israel views.

"Barack Obama's path to strengthening ties with the Jewish community is severely blocked when appointing an anti-Israel figure like David Bonior. While in Congress, Bonior refused to stand by Israel after repeated terrorist attacks, was known as a stalwart opponent to Israel, and is now a representative for Barack Obama. Bonior's appointment is the latest in a series that raises serious questions and doubts about Barack Obama's positions and judgments on the Middle East."

During his Congressional career, David Bonior repeatedly opposed pro-Israel legislation. In 1997, David Bonior was one of 15 Congressmen who signed a letter asking then-President Clinton to pressure Israelis into making concessions to the Palestinians. In 2002, David Bonior was one of only 21 Congressmen who opposed H.R. 392, which publicly affirmed Congress's support of Israel's right to self-defense and called for the dismantling of the Palestinian terrorist infrastructure.[2] In 1990, David Bonior was one of only 34 Congressman to vote against a measure naming Jerusalem as the united capital of Israel.[3] In 1989, Bonior was one of six House members to vote against a bill that prevented US funds from going to UN entities that granted the PLO membership.[4] Throughout his career, Bonior repeatedly opposed US aid to Israel and supported arms sales to Arab states opposed to Israel's existence.

"The appointment of yet another anti-Israel advisor like David Bonior to represent Barack Obama speaks volumes to the Jewish community. The pattern
including Tony McPeak, Zbigniew Brzezinski, and Robert Malley continues with
this appointment. It's no wonder the Jewish community remains deeply skeptical and troubled by Barack Obama."

[1] Jonathan Tobin, Jewish World Review, 7/12/99.

[2] H.R. 392, "Expressing Solidarity with Israel in its Fight
against Terrorism", May 2002, 352-21 (29 voting present).

[3] H.R. 290, "In support of a unified Jerusalem", Apr. 1990,
378-34 (6 voting present).

[4] H.R. 2145, "Prohibiting US Contributions to the United
Nations Under Certain Condititons", May 1989, 396-6 (11 voting present).

3) WASHINGTON - Democratic leaders are pushing for a quick end to their party's grueling presidential nomination battle, days ahead of the final primaries and a key party meeting. Supporters of Hillary Rodham Clinton planned a weekend rally in hopes of saving her faltering candidacy.

Barack Obama is now within striking distance of the nomination after a combative months-long campaign that some top Democrats worry could harm the party's chances of winning the White House. Republican John McCain effectively wrapped up the Republican nomination in March.

As Obama worked to mend fences with Clinton and her supporters, he looked to defuse the latest controversy involving a clergyman — a supporter's sermon mocking the former first lady.

Senate Majority Leader Harry Reid said that he, House of Representatives Speaker Nancy Pelosi and party chairman Howard Dean will urge uncommitted superdelegates — the party leaders and others who may choose whomever they like — to choose sides quickly so that there is not a fight at the August convention.

"By this time next week, it will all be over, give or take a day," Reid said Thursday.

Democratic officials said Pelosi already has begun contacting uncommitted House members urging them to weigh in soon after the primary season ends.

There are just three primaries remaining — Puerto Rico on Sunday and Montana and South Dakota on Tuesday.

Obama picked up two more superdelegates Friday, bringing him within 42 delegates of clinching the nomination, according to The Associated Press tally, and leads Clinton by 200 delegates. He has 1,984, to her 1,782, out of the 2,026 necessary for the nomination.

Obama stands to gain a minimum of roughly 20 delegates in the three remaining primaries under party rules that distribute them in proportion to the popular vote — even if he loses all three.

Both Democrats focused on the remaining primaries Friday. Clinton was meeting with voters in Puerto Rico, and Obama — who earlier in the week campaigned in western states that will be key in the general election — was holding a rally in Montana.

Clinton is now hoping that leaders at a meeting of the party's rules committee on Saturday will decide to seat the delegations from Michigan and Florida, whose primaries were voided when they were moved into January in violation of party rules.

Her supporters are mobilizing for protests outside the Washington hotel where the committee is meeting. Clinton has threatened to campaign to the convention if she is not satisfied with the meeting results.

At least several busloads of Clinton supporters were anticipated from Florida and perhaps scores of people from Michigan as well as demonstrators from various parts of the United States. Barack Obama's campaign discouraged a counterprotest, although his supporters vied with Clinton backers for the limited public seats inside the meeting. People in those seats cannot bring in signs or banners or disrupt the meeting, party officials said.

The party must handle the situation delicately. It wants to enforce discipline and not shift the campaign's momentum, but must avoid alienating Clinton's supporters and lose a chance at capturing two swing states that have the potential to go Republican.

Obama's campaign is willing to give Clinton the major share of delegates from Florida and Michigan, but is stopping short of her demand to fully recognize the two renegade states. Clinton won both, but both Obama and Clinton agreed not to campaign for the Florida primary and Obama was not even on the ballot in Michigan.

Nationally, Obama has developed a clear lead over Clinton — 54 percent to 41 percent, a Pew Research Center poll conducted May 21-25 shows. That is a change from April, when the same poll found he and Clinton were running about even.

When matched against McCain, Obama is now running about even among all voters; he has had a narrow advantage over McCain most of the year.

McCain, a decorated Navy pilot and former Vietnam prisoner of war, has built much of his candidacy on his foreign policy and national security experience. While he supports continued U.S. military involvement in Iraq, Obama has called for a quick withdrawal of the troops. He made his only trip to Iraq in January 2006 as part of a congressional delegation.

In the latest campaign controversy to involve a clergyman, Obama said he was "deeply disappointed" by a priest's sermon at his church that mocked Hillary Rodham Clinton.

The Rev. Michael Pfleger, a Chicago activist who supports Obama, also apologized for last Sunday's sermon at Obama's church, in which he said Clinton's eyes welled with tears before the New Hampshire primary because she felt "entitled" to the Democratic nomination and because "there's a black man stealing my show."

Obama has cut ties with his former pastor the Rev. Jeremiah Wright, who was blasted for his sermons blaming U.S. policies for the Sept. 11, 2001 terror attacks and calls of "God damn America" for its racism.

McCain rejected endorsements from two evangelicals. The Rev. John Hagee has been criticized as anti-Catholic, but McCain rejected his endorsement only after a Web site unearthed a sermon Hagee gave portraying Hitler as a tool God used to deliver Jews to the promised land. McCain disowned the Rev. Ron Parsley's endorsement after ABC News reported that he had called Islam an "anti-Christ" religion.