TARP Can Spell Part - and Part It Will Come To Be!

From the lovely daughter of one of my dearest friends and also a fellow Alabamian. Her daughter lives in and sent this from Israel. (See 1 below.)

In order to stimulate the economy Obama has decided the adage: 'haste makes waste' is politically incorrect so he is about to open the flood gates but he also intends to shut them before spending hits a trillion! Obama has also promised there will be no "boondoggles." To assure the American taxpayer, Obama has set up another bureaucratic office. Before this ends, no doubt another monumental building will be constructed and placed on a special hill built for that purpose on 'The Mall' so that its occupier has Congressional oversight. Furthermore, I suspect many SEC employees will be sending their resumes because of the superb job they did uncovering Madoff's many Ponzi schemes.

In his same vein I was bemused by an article I read about what a fine return TARP had enjoyed in its first three months of operation - 3%. The article went on to point out that would result an annualized rate of 12%, better than most Wall Street money managers have accomplished. In the same paper, on another page, there was another article pointing out the expanded cost of managing TARP - so the jury remains out.

Furthermore,TARP returns gleaned to date came largely from fees extracted by those who found themselves over a barrel. Specifically in the case of AIG the initial federal heist was deemed so overboard it was later revised.

Pardon me for being unconvinced but I view Paulson's TARP as if it were a visitor to Mother Hubbard offering her can goods if she wiill simply move out of her house.

AIG is now iquidating itself under stress. I certainly would not want government as a financial partner calling the shots. Government loans, preferred stock positions will come at a very high price, as I am confident many of the recipients of TARP's largess will soon conclude.

Meanwhile the co-operation between the current administration and the incoming one is reported as being extraordinary. Obama bashed Bush unmercifully during the campaign yet, Obama visited the Oval Office today accompanied by all the living ex-presidents. He was bouncy, full of smiles and acted as if his hurtful and unfair rhetoric never penetrates. Is politics such an insincere and whorish profession, politicians can say and do anyting in the belief no one really gives what they say a second thought? If so, politicians to exist must become heavily coated with teflon and if so, I pose, how can they sit in their cushy leather chairs without sliding off the seat. Amazing!

The media and press are now complaining they have been excluded from Gaza so they cannot report the news!!!!! DUH! When did the press and media ever report unvarnished news when it comes to Israel. They can't even lead off without injecting their bias.

A friend, fellow memo reader and former Iranian hostage responded to my tongue in cheek piece about my previous memo entitled: "we're in trouble."

He pointed out, correctly so, that it "...falls apart half way through because - there are only 2.9 million civilians working for the federal govt and 1.1
million in the military, for a total of 4.0 million. The list says
there are 30 million working for the fed govt and the next line implies
that the "30 million" feds don't work. So it's wrong on all
counts, which means the final conclusion ... skewed. And let me tell ya,
many, many of the feds work a lot harder than people give them credit
for. Moreover, a lot of them could actually make more money in the
private sector, particularly the talented middle and senior managers.
They work for the feds because they're patriotic and because they want
to make a difference in the lives of Americans. You know people who say
they want to work in public service; but have you ever heard anyone who
says they want to work in "private service?"

I responded: "I alluded to the fact the numbers were skewed in my memo and not reliable but the humor was still there. As for how hard the federal employees work I am sure they do. (My sister-in-law is one of them and brother-in-law was one of them.) The problem is, bureaucrats work hard for a federal organization that is
dysfuctional and thus the impact of their efforts are largely wasted and
spent on matters that are irrelevant and/or counterproductive. We need
government just not the one we have as presently constructed. I doubt much will change. However hope springs eternal. My problem is that I will not live to eternity.

Thanks for your comments with which I mostly concur."

Another article much in the vein of the Stratfor analysis posted in my previous memo regarding Hamas and Arab Nations. (See 2 below.)

Burris will be seated as I have predicted but Democrat leadership must go through the process of demeaning him first as Democrat bad theater continues to play out but, in the end, the curtains will eventually drop on Sen. Reid. What a spiteful hack Reid is and proves to be daily.

The IDF is now setting about destroying as many Hamas' tunnels as possible. I wrote months ago that the U.S. has new sonar type equipment which can detect tunnel voids in the ground more easily.

And a summary of events on the ground today.(See 3 and 3a below.)

More bias? This time from Marxist doctors? (See 4 below.)

The Gaza War demonstrates how well Israel learned from its failures in Lebanon, successfully implemented changes and improved co-ordination between Shin Bet and the IDF. (See 5 below.)

Rotem Yacobi implores the world to wake up - Yacobi, you must be smoking something. (See 6 below.)

Douglas Bloomfield suggests Israel would be willing to settle for something less than Arab nations. (See 7 below.)

For those who want to read a lot about Barney here it is. (See 8 below.)

Abe Greenwald sees a Democrat rift developing and I repeat, I suspect Democrat power may well be in the process of peaking. (See 9 below.)

The Guardian continues to show not only its bias but it also reveals it continues to do so by playing ostrich. (See 10 below.)



Dick


1) A Caterpillar and An Anthem


Saving Israel: How the Jewish People Can Win a War That May Never End, will be published in March 2009. Some of the ideas explored below, such as the question of how Israelis might have to choose between peace and survival, are explored in much greater detail there.


We didn't mean to, but we lied to our kids.

Almost ten years ago, shortly after we made aliyah, we were sitting with our three young children having dinner. One of the boys, still getting used to the idea that his life was going to be very different in Israel, looked up from his food, and asked out of nowhere, "Is Israel still going to have an army when I'm eighteen?"

He was scared. But we knew that he had no reason to be. "Yes, there'll be an army," we told him. "But there's going to be peace by then. By the time you're eighteen, everything's going to be different. You'll see." I still remember how certain we were, and how relieved he looked.

A couple of weeks ago, on the Wednesday of Hanukkah, Hamas fired more than 60 mortars and rockets at Sederot and the western part of the Negev. The number was high, but the situation wasn't new. The kids of Sederot have been getting shelled for eight years, with a dramatic increase since Israel got out of Gaza in 2005. The next day, Thursday, I was supposed to go to Sederot to visit my friend, Laura, to see some of the work she was doing on a new movie (about the music scene in Sederot, in which her husband is a leading figure). Despite the horrible weather, it was still a (Hanukkah) vacation day of sorts, and I asked the kids if any of them wanted to come with me. Talia, now in law school, had class and a massive amount of work. Micha, the only one still in high school, also had too much studying to do. But Avi, home from the army for a few days, said he'd happily come - he and I don't get lots of hang-out time together anymore.

My tour-guide wife was out of town, guiding a family in the north. I figured that I should check with her before taking one of her kids and her only car to Sederot on a week like that. But she didn't hesitate for a second. "Of course you should go," she said. "Remember how we resented those people who wouldn't come to Jerusalem when we were the ones under attack. Just drive safely, and be careful out there. I'll be home for dinner." I wasn't quite sure how one was supposed to "be careful" in the car if rockets started falling out of the sky again, but I didn't press the point.

A couple of hours later, Avi and I were in Sederot, at Laura's house. The city seemed deserted, but it was hard to tell whether that was because of the previous day's barrage of rockets, or the drenching rain that fell all day. The skies were quiet. But even on a day when rockets didn't fall, it didn't take long to see how utterly surreal life there has become.

Laura had a great, gigantic publicity poster for a classic movie on her living room wall. "Great poster," I said to her. She told me a bit about the store in Jaffa where she'd bought it. "Is it an original?" I asked her. "They had originals," she said, "and I was actually tempted to get one. But then I realized that it's kind of absurd to buy anything of value to put in your house when you live in Sederot." I tried to imagine what it would be like to live not wanting to have anything of value, knowing that your house could be obliterated almost without warning, because you happen to live within rocket range of a terrorist state that has no territorial dispute with you, but simply doesn't recognize your right to exist, and never will.

After chatting for a while and seeing some of the movie-in-progress, we decided to go out to grab a bite for lunch. On the way to the café, Laura pointed out the neighbor's house that's now deserted because the owner moved away after a rocket hit it. She pointed to the traffic circle where a young boy had his leg blown off a few months ago in a different attack. And so on.

But what struck me more than anything on the way to lunch was the playground. Even in the pouring rain, it looked just like a regular playground, with jungle-gyms, swing sets and the like. There was even a colorful cement caterpillar - for the kids to climb on, I assumed. "See the caterpillar?" Laura asked me. "It's hollow," she said. "And see over there? Those are the openings. It's really a bomb shelter. When the Color Red siren goes off [indicating an incoming kassam], the kids can run from the other parts of the playground into the caterpillar and wait there until the rocket hits." (I asked Avi, sitting in the back, to take a quick picture, despite the rain.)

On the drive back, Avi and I got a chance to chat. It was absurd, we both knew. What Israel was (not) doing was beyond immoral. States have an obligation to protect their citizens, and we weren't doing it. That, undoubtedly, was the sentiment behind the graffiti that we saw, claiming that Sederot should "secede" [the actual word, tellingly, was "disengage"] from the "pathetic state."

Why should children living in uncontested Israeli territory grow up being taught that in the playground, when the siren goes off, you run into the caterpillar, and hope that the rocket doesn't kill any of your friends who don't make it in time? For how many years does a State have a right to ignore the citizens whose children, at the ages of eight and nine, are wetting their beds all over again, the sheer terror of the siren reducing their entire childhood to a years-long nightmare? For how many years dare Israel do nothing, as hundreds of families, terrified that the rockets will hit in the middle of the night, all sleep in the same room? What does it do to a family, and to marriages, when elementary and high school age children have been sleeping in their parents' room on the floor for years?

How do you educate kids, my friend Ahrele (the principle of the high school in that region) once asked me, when the siren goes off (sometimes several times a day), and hundreds upon hundreds of kids cram the high school hallways desperate to get to a protected room but can't move because all the passageways are jammed with students? And then, minutes later, when it's over, how are they supposed to sit quietly and start thinking about their history class, or focus on geometry? "We didn't finish the job," Ahrele once said to me and Elisheva during a dinner at his home a couple of years ago, the sounds of exploding shells in the distance punctuating our conversation. "We didn't show them that we intend to live here, no matter what. Really, when you think about it, this is just the latest battle in the War of Independence. It's the battle for our right to have a place to live."

He was right, of course. It was absurd for us to tell our kids that they wouldn't go to war. Because if the War of Independence was about making it clear that we intend to stay and getting our enemies to acknowledge that we, too, have a right to a country and a normal life, then we've yet to win it.

So now, we have to try again. Some progress has been made. For thirty five years, Syria, Jordan and Egypt have all refrained from launching military attacks on Israel. Because they love us? Hardly. It's just because they know that we will obliterate them if they do. Even when Israel bombed a nuclear-reactor deep inside Syria, Syria whined but did nothing. They've learned their lesson. Maybe Hezbollah did, too, the disasters of the 2006 Second Lebanon War notwithstanding. At this writing, at least, in the first hours of the ground war, they're staying out of the present conflict. One hopes that they're smart enough to keep that up.

But Hamas hasn't yet learned, and because of that, our citizens have been suffering for years. So there is no choice but to fight this war, and to win it decisively.

On the Shabbat afternoon after our visit to Sederot, Avi's girlfriend, who was at our house for lunch, suddenly got called back to her base. That was our first inkling that the war was starting. The next morning, Avi went back to the army, but to a different base. And by Sunday evening (the last night of Hanukkah), Talia, in the first semester of law school, struggling with a massive amount of school work and finally just getting the hang of it all, had been called back to her unit.

Quite frankly, I expected some tears when she told me that she'd been called up. How would she keep up with school? The vast majority of her classmates hadn't been called up, so it wasn't as if school would be cancelled. How would she ever catch up? What, I figured she'd want to know, was going to happen to her grades?

But when we called her downstairs to light Hanukkah candles for the final night, there weren't any tears. What I saw on her face was steely-eyed stoicism. There was work to be done, she knew how to do it, and they needed her. So she was heading back to the army.

Suddenly, I remembered the night, long ago, when we'd told her and her brothers that the wars were all over, that peace was on its way. For a moment, I thought that I should apologize to her, tell her how much we didn't know back then, that I was really, really sorry that this is how it is. That Elisheva and I didn't have to go to college like this, and that I hoped that she wasn't angry with us for having made the decisions that now mean she does.

But by the time I thought of saying something to her, the candles were already lit, and we were up to Maoz Tzur. We got to the last stanza, and I had my arms around her and together, we were all singing:

Chasof zero'a kodshekhah
Bare Your Holy arm and hasten the arrival of some salvation
Avenge the vengeance of your servant's blood from the wicked nation
Ki archah lanu ha-yeshu'a
For real victory is taking far too long
And there is no end to the days of evil

There's nothing new in this whole story, I was reminded. It's what Jews have had to do for generations to stay alive, and it's what the younger generation now is being asked to do, again.

So I didn't apologize. When we were done, she went up to her room to look for the uniforms that she'd packed away someplace last year, assuming that after three years in the army, she wouldn't be needing them anymore. As she climbed the stairs, I thought again of the caterpillar. And of the poster that had to be a replica because the house might come down. And of the kids still wetting their beds. And of towns that have known only terror for years after years.

Our kids don't want an apology. They'd be appalled if one were forthcoming. Because they understand, better than we did at their age, that this simply has to be done. What's at stake is not Sederot. What's at stake is the question of whether Jewish sovereignty means anything. One can - and should - be saddened by the loss of life in Gaza these weeks, on both sides. But we dare not let caring about innocent human life among Palestinians, or even more understandably, our dread of what the casualties among the IDF may be, blur the urgency of what we need to do.

These weeks, with the question of whether or not Jewish sovereignty means anything at all, there is really only one question. As Joshua said to the angel (Joshua 5:13), "are you for us, or for our adversaries?" Do you believe that Jews in Sederot have a right to live without bomb-shelter caterpillars in their playgrounds? Do you think that parents in that whole part of the country have a right to sleep in their own room by themselves, and that nine year olds should no longer wet their beds, night after night, caught in nightmares that will probably hound them for life? Do you understand that the only point of having a Jewish state is that Jews should no longer live - and die - at the whim of those who hate us just because we exist? Do you get that Ahrele was right? That we're still fighting for the simple right to have the world acknowledge that we have a right to be?

There's only one question, and it is Joshua's. Are you for us, or for our adversaries? There is no place for mealy-mouthed equivocation calling for an end to the "violence," for that is nothing more than a euphemism for more years of Jewish kids living in dread and Jewish sovereignty meaning nothing.

Israel could well become a horribly tear-soaked country this week. But thankfully, we finally have leadership that seems to understand that what is at stake is the question of whether having a state changes anything at all about the existential condition of the Jews. At long last, they get it - if Jews still have to live in dread, for the mere sin of existing, then there's really no point to any of this.

So pray for them. Whatever you believe, or don't, pray for the thousands of kids out there doing what the Maccabees did - risking everything so the Jews can survive. And remember, no matter how devastating the pictures that will inevitably emerge from the theater of war, that it's all about something really simple. We say it, all the time, in our national anthem:

Od lo avedah tikvateinu ... liyot am chofshi be-artzeinu
We haven't yet abandoned our hope ... to be a free people in our land.

That's really all we want.

More than that, we don't need.
But for less than that, we'll never, ever settle.

2) Iran's Hamas Strategy
By REUEL MARC GERECHT

Anyone who knows anything about the Middle East knows that Sunni and Shiite radicals don't work together -- er, except when they do. Proof that the conventional wisdom is badly wrong is on offer in Gaza, where the manifest destiny of the Islamic Republic of Iran is now unfolding. Tehran has been aiding Hamas for years with the aim of radicalizing politics across the entire Arab Middle East. Now Israel's response to thousands of Hamas rocket provocations appears to be doing just that.

Iranian President Mahmoud Ahmadinejad attends an anti-Israeli demonstration in Tehran, Dec. 12, 2008. A poster at rear shows the late spiritual leader and founder of the Hamas movement, Sheik Ahmed Yassin.

Born in the 1980s from the ruins of the Palestine Liberation Organization's corrupt and decaying secular nationalism, Hamas is a grass-roots, Sunni Islamist movement that has made Shiite Iran a front-line player in the Israeli-Palestinian conflict. Before Hamas, the mullahs had financed the Palestine Islamic Jihad, whose holy warriors became renowned suicide bombers. But Islamic Jihad has always been a fringe group within Palestinian society. As national elections revealed in 2006, Hamas is mainstream.

Although often little appreciated in the West, revolutionary Iran's ecumenical quest has remained a constant in its approach to Sunni Muslims. The anti-Shiite rhetoric of many Sunni fundamentalist groups has rarely been reciprocated by Iran's ruling elite. Since the death in 1989 of Ayatollah Ruhollah Khomeini, the charismatic, quintessentially Shiite leader of the Islamic revolution, Iran's ruling mullahs have tried assiduously to downplay the sectarian content in their militant message.
Khomeini's successor, Ali Khamenei, has consistently married his virulent anti-American rhetoric (Khomeini's "Great Satan" has become Khamenei's "Satan Incarnate") with a global appeal to faithful Muslims to join the battle against the U.S. and its allies. Ali Akbar Hashemi Rafsanjani, the most politically adept of the revolution's founding clerics, loved to sponsor militant Sunni-Shiite gatherings when he was speaker of parliament and later as president (1989-1997). He and Mr. Khamenei, who have worked hand-in-hand on national-security issues and have unquestionably authorized every major terrorist operation since the death of Khomeini in 1989, have always been the ultimate pragmatists, even reaching out to Arab Sunni radicals with a strong anti-Shiite bent.
The Opinion Journal Widget

The most radical branch of the Egyptian Islamic Jihad Organization and its most famous member, Ayman al-Zawahiri, became favored Arab poster boys for the clerical regime in the 1980s and 1990s even though Islamic Jihad, like other extremist takfiri Sunni groups, damns Shiites with almost the same gusto as it damns Western infidels. The laissez-passers that Iran gave members of al Qaeda before Sept. 11, 2001 (see the 9/11 Commission Report), the training offered to al Qaeda in the 1990s by the Lebanese Shiite Hezbollah (again, see the report), and the "detention" of senior members of al Qaeda fleeing Afghanistan after the American invasion are best seen against the backdrop of clerical Iran's three-decade long outreach to radical Sunnis who loathe Americans more than they hate Shiites.

In 2003, Iran launched two Arabic satellite TV channels both under the guidance of the former Revolutionary Guards commander Ali Larijani, a well-dressed, well-trimmed puritan with a Ph.D. in philosophy who crushed a brief period of intellectual openness in Iran's media in the early 1990s. A favorite of Mr. Khamenei, Mr. Larijani pushed TV content extolling Hamas, anti-Israeli suicide bombers, anti-Semitism and an all-Muslim insurgency in Iraq. Iran's remarkably subdued rhetoric against Arabs who gave loud support to insurgents and holy warriors slaughtering Iraqi Shiites between 2004 and 2007 is inextricably tied to Tehran's determination to keep Muslim eyes focused on the most important issue -- the battle against America and Israel. Iran's full-bore backing of Hezbollah in the July 2006 war with the Jewish State, a conflict that Tehran and its Syrian ally precipitated by their aggressive military support of Hezbollah, drew Sunni eyes further away from Iraq's internecine strife.

The 2006 Lebanon war, which lasted 34 days and saw Hezbollah's Iranian-trained forces embarrass the Israeli army, made Tehran's favorite Arab son, Hezbollah leader Hassan Nasrallah, one of the most admired men in the Sunni Arab world. This was a remarkable achievement given that Hezbollah had helped Iran train some of the Iraqi Shiite militants who were wreaking a horrific vengeance against Baghdad's Sunni Arabs in 2006 -- a bloodbath that was constantly on Arab satellite television.
Prominent Sunni rulers -- Egypt's Hosni Mubarak and Jordan's King Abdullah -- have railed against a "Shiite arc" of power forming in the Near East, only to see few echoes develop outside of the region's officially controlled media. Although the Sunni Arab rulers have sometimes shown considerable anxiety about the prospect of an Iranian nuclear weapon, Sunni fundamentalist organizations affiliated with Egypt's Muslim Brotherhood, the mother ship for Sunni Islamists, have been much more restrained in expressing their trepidation.

With strong ties to its fundamentalist brethren along the Nile, Hamas has given Iran (really for the first time, and so far at little cost) an important ally within the fundamentalist circles of the Muslim Brotherhood. One of the Islamic revolution's great disappointments was that it failed to produce more allies within the Egyptian Muslim Brotherhood and its many offshoots.

The revolution certainly inspired many within the movement in Egypt and in Syria. But Iran's ties to the ruling Syrian Allawite elite -- a heretical Shiite sect that Sunni fundamentalists detest -- complicated its outreach to Sunni militants. When Syria's dictator Hafez Assad slaughtered thousands of Sunni fundamentalists in the town of Hama in 1982, and revolutionary Iran remained largely silent, Tehran's standing within the Muslim Brotherhood collapsed.

With Hamas, Iran has the opportunity to make amends. The mullahs have a chance of supplanting Saudi Arabia, the font of the most vicious anti-Shiite Sunni creed, as the most reliable backer of Palestinian fundamentalists. Even more than the Lebanese Hezbollah, which remains tied to and constrained by the complex matrix of Lebanese politics, Hamas seems willing to absorb enormous losses to continue its jihad against Israel. Where Saudi Arabia has been uneasy about the internecine strife among Palestinians -- it has bankrolled both Hamas and the Palestinian Authority of Mahmoud Abbas -- Iran has put its money on the former.

Although Fatah, the ruling party within the Palestinian Authority, may get a second wind thanks to the excesses of Hamas and the Israelis' killing much of Hamas's brain power and muscle, it is difficult to envision Fatah reviving itself into an appealing political alternative for faithful Palestinians. Fatah is hopelessly corrupt, often brutal, and without an inspiring raison d'être: a Palestine of the West Bank and Gaza is, as Hamas correctly points out, boring, historically unappealing, and a noncontiguous geographic mess. Fatah only sounds impassioned when it gives vent to its anti-Israeli, anti-Semitic, profoundly Muslim roots. It's no accident that the religious allusions and suicide bombers of Fatah and Hamas after 2000 were hard to tell apart. If Hamas can withstand the current Israeli attack on its leadership and infrastructure, then the movement's aura will likely be impossible to match. Iran's influence among religious Palestinians could skyrocket.

Through Hamas, Tehran can possibly reach the ultimate prize, the Egyptian faithful. For reasons both ancient and modern, Egypt has perhaps the most Shiite-sympathetic religious identity in the Sunni Arab world. As long as Hamas remains the center of the Palestinian imagination -- and unless Hamas loses its military grip on Gaza, it will continue to command the attention of both the Arab and Western media -- Egypt's politics remain fluid and potentially volatile. Tehran is certainly under no illusions about the strength of Egypt's military dictatorship, but the uncertainties in Egypt are greater now than they have been since the assassination of Anwar Sadat in 1981.

President Hosni Mubarak, Sadat's successor, is old and in questionable health. His jet-setting son or a general may succeed him. Neither choice will resuscitate the regime's legitimacy, which has plummeted even among the highly Westernized elite. The popularity and mosque-power of the Muslim Brotherhood, which would likely win a free election, continues to rise. A turbulent Gaza where devout Muslims are in a protracted, televised fight with the cursed Jews could add sufficient heat to make Egyptian politics really interesting. The odds of Egypt cracking could be very small -- the police powers of the Egyptian state are, when provoked, ferocious -- but they are now certainly enough to keep the Iranians playing.

Where once Ayatollah Khomeini believed in the revolutionary potential of soft power (Iran's example was supposed to topple the pro-American autocrats throughout the Middle East), Khomeini's children are firm believers in hard power, covert action, duplicity and persistence. With Gaza and Egypt conceivably within Tehran's grasp, the clerical regime will be patient and try to keep Gaza boiling.

It is entirely possible that Tehran could overplay its hand among the Palestinians as it overplayed its hand among Iraqi Shiites, turning sympathetic Muslims into deeply suspicious, nationalistic patriots. The Israeli army could deconstruct Hamas's leadership sufficiently that Gaza will remain a fundamentalist mess that inspires more pity than the white-hot heat that comes when jihadists beat infidels in battle. But with a nuclear-armed Iran just around the corner, the mullahs will do their best to inspire.

Ultimately, it's doubtful that Tehran will find President-elect Barack Obama's offer of more diplomacy, or the threat of more European sanctions, to be compelling. The price of oil may be low, but the mullahs have seen worse economic times. In 30 years, they have not seen a better constellation of forces. And as the Shiite prayer goes, perhaps this time round the Sunnis, too, inshallah (God willing), will see the light.

3)Massive Israeli assault on Hamas smuggling tunnels, Egyptian ultimatum to Hamas


Wednesday, Jan. 7, Cairo presented Hamas with an ultimatum to reply to Egypt's ceasefire proposals by 6 a.m. Thursday, Jan. 8. That night, Israel launched a massive air and artillery assault on Hamas arms smuggling tunnels running under the Philadelphi route along the Egyptian border and adjoining houses in Rafah. Leaflets dropped in advance by the Israeli air force warned the 30,000 dwellers in the targeted region to leave their homes.

Hamas' Southern Brigade is deployed in this strategic sector of the southern Gaza Strip under the command of a high-ranking Hamas commander called Al-Attar. Its operatives tried and failed to stem the flight from the Yibne and Block O Rafah refugee camps and Rafah's Tel Sultan

Military sources report Israel has been pounding this Hamas lifeline for arms supplies and reinforcements by air and sea for days. Dozens of tunnels were demolished but enough of the system remained for Hamas to restore it if given the chance. With the new assault Israel is determined to destroy the entire network for good.

For Hamas-Damascus and Hamas-Gaza alike, bowing to the Egyptian ultimatum and accepting the proposal intelligence minister Gen. Omar Suleiman put before its representatives in Cairo Tuesday would be seen as a surrender to the Israeli Defense Forces.

The ultimatum may have been coordinated with the Israeli assault on the tunnels.

Israeli defense ministry official Amos Gilad and Olmerts envoy Yoram Turbovitch fly to Cairo Thursday to start talks on Egypt's ceasefire proposals.

Israel's prime minister sent his political adviser Shalom Turjman to Washington Wednesday night.

Earlier, the Israeli defense cabinet decided to continue the military operation against Hamas in the Gaza Strip while also discussing the ceasefire proposals received from Egypt.

A growing number of cabinet ministers advocated expanding the military operation against Hamas and bringing it to the point of resolution, supporting the view held by prime minister Ehud Olmert and the military high command.

3a)Summary of Today's operations; IDF Opens Humanitarian Affairs Coordination Center (HACC)


Today, the IDF opened a Humanitarian Affairs Coordination Center (HACC)
today, in Tel Aviv.

The center's aim is to coordinate between the different organizations
operating in the field and those of the IDF and will not replace existing
structures. The center will place highest priority to the evacuation of
foreign nationals and to coordinating the flow of food, fuel and supplies of
goods to the humanitarian organizations.

Organizations represented include the International Committee of the Red
Cross (ICRC), USAID, World Food Program, the European Commission, the United
Nations Special Coordinator for the Middle East (UNSCO), UNRWA, Office for
the Coordination of Humanitarian Affairs, as well as Israeli governmental
agencies and IDF departments.

Furthermore, over twenty rockets were launched today from the Gaza Strip to
Israel, wounding two people.

IDF forces, including infantry, tanks, combat engineers, and intelligence,
continue to operate throughout the Gaza Strip. The Israel Air Force,
Israeli Navy, and Artillery Corps all provided support and struck
concentrations of Hamas fighters that were within range of the IDF forces.
Rocket launching sites that were used for attacking IDF forces were also
struck.

On a number of occasions, the ground troops came under fire from armed Hamas
gunmen and responded with direct fire.

One IDF soldier was moderately wounded and an additional eight soldiers were
wounded in the fighting.

IAF aircraft attacked over 40 additional targets throughout the day,
including a number of smuggling tunnels in southern Gaza, 14 rocket
launching sites, 4 armed terror cells, a Hamas outpost, 9 tunnels dug under
houses, and a weaponry storage facility.

The IDF will continue to operate against all terror organizations, and
anyone harboring terror.

4) Norwegian Doctors in Gaza: Objective Observers or Partisan Propagandists?
By Ricki Hollander

The source of most of the information coming from Gaza thus far has been from Palestinian representatives. One of the only non-Palestinian voices heard has been that of Mads Gilbert, a Norwegian doctor who entered Gaza on December 31 along with his colleague Erik Fosse ostensibly to provide medical assistance to Palestinians at Shifa Hospital. They have become media stars as the BBC, CBS, CNN, ABC, Independent, Sky News, and New York Times, among others, have turned to them as independent foreign observers to provide a presumably non-partisan perspective. They have been extensively interviewed in the Norwegian as well as the world press. In fact, Gilbert appears in so many interviews that one wonders how he has the time to provide medical help, never mind "doing surgery around the clock" as he claims.

In his interviews, Gilbert decries what he claims is Israel's "all out war against civilians." Condemning Israel for "deliberately targeting the [Palestinian] population" and causing "a man-made disaster," Gilbert and Fosse claim that Israel and the UN are lying about the civilian casualty count and feed the media their own alternate statistics ( "50% of the casualties are women and children"–CBS; "children made up 25% of the deaths and 45% of the wounded"–BBC). Gilbert is even quoted by the Iranian Press TV alleging the Israelis have used unconventional weapons against the Palestinians.

So are these Norwegians indeed non-partisan foreigners providing independent confirmation of Palestinian reports or do they have an agenda? Is Gilbert simply someone "who was allowed into Gaza last week to give emergency medical aid, and who has worked in many conflict zones," as the New York Times introduces him or someone with a partisan perspective?

Gilbert is a radical Marxist and a member of the political Red (Rodt) party, a revolutionary socialist party in Norway. He has been a pro-Palestinian activist since the 1970's and travelled to Lebanon in support of the Palestinians during the first Lebanon war in 1982. He has long been a vocal opponent of Israel and the U.S. Gilbert has acknowledged that he cannot separate politics from medicine, stating, "there is little in medicine that is not politics." He even criticizes the group Doctors Without Borders for providing medical assistance to both sides in a conflict instead of taking a strong stance and supporting only one party. In a 2006 article in Nordlys, journalist Ivan Kristoffersen lamented the fact that Gilbert allows his humanitarian efforts to be politicized by his radical agenda.

The extent of Gilbert's political agenda and animus toward Israel and the U.S. is best evidenced by his radical support for the 9/11 terrorist attacks against the U.S.

In an interview with the Norwegian daily, Dagbladet, shortly after the attacks, Gilbert stated:

The attack on New York was not surprising, after the policy that has led the West in recent decades. I am upset over the terrorist attack, but am equally upset over the suffering which the United States has created. It is in this context that the 5000 dead people must be seen. If the U.S. government has a legitimate right to bomb and kill civilians in Iraq, then there is also a moral right to attack the United States with the weapons they had to create. Dead civilians are the same whether they are Americans, Palestinians or Iraqis.


When asked by Dagbladet if he supported the terrorist attack on the U.S., he replied:

Terror is a bad weapon, but the answer is yes, within the context I have mentioned. (Sept. 30, 2001)

Fosse worked as a doctor for the Palestine Committee in Lebanon in the 1970's. He now leads NORWAC, the Norwegian Aid Committee. According to Aftenposten, Fosse's passion to work on behalf of Palestinians was sparked by his time in Lebanon.

According to Verdens Gang, the largest Norwegian daily, Gilbert and Fosse's current trip to Gaza is funded by the Norwegian foreign ministry.
Given the partisan — and in Gilbert's case, radical — perspective they represent, Fosse's and Gilbert's testimony must be weighed with extreme caution.

5) Excellent intel on Gaza shows Israel learned from its errors in Lebanon
By Yossi Melman


At a Hanukkah candle-lighting at the Shin Bet security services headquarters two weeks ago, Yuval Diskin spoke with former heads of departments about the organization's preparedness to confront Hamas. The head of the Shin Bet sounded quite cautious. Perhaps even he was surprised by the quality of the intelligence that he and his people had succeeded in providing the Israel Defense Forces during the months of planning that preceded Operation Cast Lead and in the days prior to its launch.

Even those who object to the war in the Gaza Strip will find it hard not to agree that this time around, the intelligence community mostly succeeded in delivering the goods. Seen in the light of the Second Lebanon War failures, these achievements are particularly impressive. Back in 2006, the strategic data provided by the intelligence community was deemed sound, as it allowed the air force to within 34 minutes destroy most of Hezbollah's hideouts for its long-range rockets. But there were many shortcomings at the level of tactical intelligence, especially field intelligence. Even if Military Intelligence had had information about Hezbollah bunkers or outposts, this intel did not always succeed in reaching the forces in the field.

The Israel Defense Forces drew lessons from its failures, and this time, the fighters were better prepared. They are equipped with good intelligence measures and also have access to reliable information while in the field. The dissemination of intelligence is made possible by Shin Bet case officers, who work out of IDF command centers.
Advertisement

Another important factor leading to this success is the close and unprecedented cooperation between the Shin Bet and Military Intelligence: Military Intelligence with its 8200 signal intelligence (sigint) gathering unit in the technological realm and Unit 504 that runs agents, together with the research division and air force intelligence, which provides aerial photographs, has had a considerable role to play in this conflict's intelligence achievements.

With the help of MI 8200, the Shin Bet has begun to transform from an intelligence organization based on human sources into an intelligence-gathering organization that is also adept at electronic eavesdropping, intercepting messages and decoding them. In the Shin Bet today there is talk of "operating sensors," rather than "operating human sources." This stresses the change in its gathering methods, which are varied: They are no longer relying only on agents who provide information to their operators, but also technological systems that make it possible to listen in on phone conversations, intercept faxes and decode messages and the dispatches. In this way, the Shin Bet has compensated for the blows it experienced - less access and difficulties recruiting human sources - since the transfer of the Gaza Strip to Palestinian control in 1994 and the disengagement three years ago. Face-to-face meetings to transmit information between an agent and his handler have been replaced by other methods.

In Military Intelligence speak, cooperation with the Shin Bet and other agencies is called "intelligence fusion," meaning "a joint effort of a number of intelligence agencies in providing resources, knowledge and information to achieve the maximum result." Practically speaking, the "fusion" is manifested in the efficient use of computer programs and the storage and analysis of multi-layered intelligence (measures, voices and data) also during battle.

A precise hit

The intelligence community has thus far succeeded in preparing a rich "target bank" to serve the air force and ground forces. Accurate and precise intelligence is of particular importance in a densely populated area like Gaza, where every mistake is liable to cause the deaths of hundreds of innocent people. Nevertheless, despite its good intelligence, Israeli troops still killed dozens of innocent civilians. Particularly impressive has been the ability to identify three mosques, which stored rockets and served as meeting places for terrorists. This is no trivial matter. Mistaken information could have caused the destruction of an innocent mosque, which was not serving as a weapons store, which would have sparked tremendous hostility toward Israel in the world, to the point of forcing it to end the fighting.

It is with good reason that even prior to the operation, the Shin Bet coined the term misgrad (a portmanteau consisting of the Hebrew word for "mosque" and the Grad rocket), which will no doubt star in the gibberish that every war produces.

Another achievement enabled the air force to make precise hits on about 40 tunnels that Hamas exclusively used to smuggle in weapons, ammunition and diesel to generate electricity in its installations. This prevented the need to carpet-bomb the border strip along all of its 12 kilometers, which most probably would have killed more innocent civilians living along the Gaza-Egyptian border (the Philadelphi Route).

However, it is dangerous and premature to boast of intelligence achievements. The longer the war, the lower the chance of continued intelligence successes. And at this stage of the fighting, it is not yet clear how close Israel is to rendering a significant blow to Hamas' strategic capabilities. During the past week, Hamas has fired between 30 and 40 rockets every day. This testifies that the organization is succeeding in maintaining its steady launching capability. The fact that its leadership has ducked underground and it fighters are in no hurry to engage in hand-to-hand fighting with the IDF does not necessarily mean they are in "a state of shock" from the fierceness of the IDF response, as Military Intelligence head Amos Yadlin assessed at a cabinet meeting this week. It is possible that, in fact, this was a well-calculated decision by the guerrilla organization to preserve its leadership and its military capabilities for the crucial confrontation - or for "the day after."

6) World citizens, wake up!n If Israel accepts rocket strikes, children worldwide will be targeted next
By Rotem Yacobi


Citizens of the world, New Year's Eve. I was sitting in my apartment in Beersheba, debating whether to go out and celebrate. Suddenly, I heard the siren. I rushed down to the building's bomb shelter, where two frightened families gathered with their young children, as well as an elderly couple and two well-dressed university students, who at that point decided to stay home after all.

We were sitting quietly, listening to the siren, and waiting to hear the explosion. A few minutes after the blast, we all returned to our apartments. As I was heading to my bed, I heard that missiles were also fired at Ashkelon. I was thinking to myself: Let's hope no missile hits some crowded coffee shop; assuming anyone is even out there celebrating New Year's Eve.

Thursday, the first day of the new year. I was supposed to head to university, but classes were cancelled. Apparently, university officials did not want to take any risks either. As I spoke with my concerned mother on the phone, I watched masses of students boarding buses and heading far away from the front. I reminded my mother that our home is no safer, and told her that for the time being I'm staying here.

I try to solve a physics problem, but I can't concentrate. The sound of a door slammed in an apartment below makes me jump. For a moment I thought that another missile landed. This is how I react to every similar noise. I go through news websites, I read that the IDF is operating in Gaza, and I think about the people on both sides of the border.

Proud to belong to this nation:
I was born in this country and so were my parents. I'm the grandson of Holocaust survivors. I was taught to love this land and to love other human beings, whoever they are. I served in the IDF, and today I am a student at Ben-Gurion University in Beersheba. I am proud to belong to this nation, which has such moral army.

I ask myself the following questions: does the world know that the IDF calls and warns civilians before it strikes their homes, used as Hamas arms caches? Does the world know that in response to this, Hamas men place women and children on the roofs of buildings, because they know the IDF won't target them?

Does the world know that the IDF takes care of humanitarian needs and supplies medicine, food, and medical services to the Palestinians ?Does the world know that Hamas men fire from within population centers and turn civilians into human shields?

Does the world know that while we fight for our legitimate right to live in peace and security, Palestinian patients receive dedicated treatment at Israeli hospitals? Did the world hear about the 20 cases where Palestinians exploited their health problems in order to attempt to carry out terror attacks?

I ask myself, where was the world more than a year ago, when Hamas men massacred Fatah men and innocent members of their own people?

Does the world know that ever since Israel withdrew from Gaza in the summer of 2005, Hamas and its allies fired more than 6,000 rockets and mortar shells at Israel and hurt innocent civilians?

Yes despite this, Israel is subjected to harsh criticism on the part of the international community in general, and European states in particular, including Britain, France, and Russia. These are all states that have existed for many years, reinforced their global status, and enjoy security in their own countries. Some of them also had colonies on other continents where they imposed their traditions, cultures, and languages.

The State of Israel, which has been in existence for 60 years now, has no desire to become a global empire or colonize areas in other continents. Israel wants the states of the world and its neighbors to recognize its independence and sovereignty. Israel wants them to also recognize its right to provide protection and security to its citizens (according to Clause 51 of the UN convention, every nation has the right for self-defense, as long as the principle of a proportional response is met. Israel's response upholds this principle.)

Citizens of the world, wake up! If we agree to tolerate the rocket attacks, your own children will be next in line.

Friday, the second day of the new year. I sit in my apartment in Beersheba and eat cookies that the neighbor from downstairs handed out at the bomb shelter. I sit there and I think about a reality where I could sign this piece as follows: Rotem Yacobi, citizen of the Free World.

7) Washington Watch: 'Booyay': Israel's reluctant allies
By Douglas Bloomfield
Two days after the IAF destroyed Saddam Hussein's Osirak nuclear reactor in 1981, the CIA held a classified briefing for members of Congress. Lawmakers wanted to know about the Arab reaction.

"Booyay," the CIA briefer said.

"Is that an Arabic word? What does it mean?" he was asked. It means publicly they were booing, the CIA official said, but privately they were cheering what came to be known as the great Nuclear Non-Proliferation Act of 1981.

The new Reagan administration was less than enthusiastic about the Israeli action and sent its UN ambassador to sit down with Saddam Hussein's UN envoy to draft a Security Council resolution condemning Israel. The administration followed up by halting the shipment to Israel of the same kind of aircraft that had just saved the entire Middle East from an Iraqi nuclear threat.

THERE IS a similar "booyay" response today among pro-Western Arab leaders to Israel's attack on Hamas in Gaza.

Moderate, pro-Western Arab leaders are praying five times a day for Israel to deal Hamas a serious setback, if not a fatal blow, because they see it as a proxy of Iran, which they consider the real threat to their regimes. They haven't the courage to say so publicly, but through the fog of denunciations, the message comes through.

The public rhetoric of most Arab states is filled with the usual venom one has come to expect when they speak of Israel, particularly when it has the audacity to strike back at terrorists like the Hamas thugocracy. But behind the angry denunciations, these same Arab leaders - Kings Abdullah of Saudi Arabia and Jordan, President Hosni Mubarak of Egypt and Palestinian Authority President Mahmoud Abbas - are hoping for Israeli success.

They're not appealing to the prophet out of any love for Zion, and those public denunciations are probably sincere albeit hypocritical, but they know what is at stake. Israel is fighting their war for them, sacrificing its lives and expending its treasure to strike a blow at their common enemy, Iran.

HAMAS IN Gaza, like Hizbullah in Lebanon, is the stalking horse for Iran. Egypt had brokered the truce that Hamas ended last month with rockets, reportedly in the hopes of winning a new deal on more favorable terms. Israel's counter-offer was delivered by its air force, armor and infantry.

Egyptian and other moderate Arab leaders blamed Hamas for provoking the response, but being the courageous chaps they aren't, they couched it in bitter denunciations of Israel for having the audacity to defend itself, even if was doing a service for those same Arab autocrats.

Mubarak's "booyay" moment came when he accused Israel of "savage aggression" while noting he had "warned [Hamas] repeatedly that rejecting the truce" would produce these results.

Jordan, which has the most to lose if Hamas succeeds in taking the West Bank as well as Gaza, said if the fighting continues it might "reevaluate" its relations with Israel.

Saudi Arabia, a principle financial backer of Hamas, put the blame on Hamas when it suggested none of this would have happened had the terror group maintained the cease-fire.

The Saudis and Egyptians blocked Syrian-led calls for an immediate Arab League emergency summit to deal with the crisis; it took five days just to convene a ministerial meeting.

The principle beneficiary of any Israeli success - besides those living in the South - would be Abbas, whose life isn't worth a plugged dinar if he dares go to Gaza. Knowing a major goal of the action is to restore his power in Gaza didn't discourage him from denouncing it as "brutal aggression" and "criminal." From this tendency of Arab leaders to speak out of both sides of their mouths, one might get the impression that they suffer from a collective case of schizophrenia, but it's actually fear mixed with hypocrisy.

NONE OF these dictators is a candidate for the next edition of Profiles in Courage. They are scared of the influence of the militant Islamists and the popularity of the Palestinian cause on the Arab street. Iran and its allies have focused on creating animosity to the entrenched and repressive Sunni regimes which, in the age of satellites and the Internet, can no longer turn public emotions on and off like a water tap.

That's why they are praying so hard for an Israeli victory.

A pro-Hizbullah newspaper said, "Israel would be satisfied with a compromise, but the Arab regimes want to finish Hamas completely." It's probably right. Israeli leaders define victory as a weakened and humbled Hamas that will halt all the attacks, honor a cease-fire and accept international supervision. Hamas, on the other hand, will declare a great victory simply if its leadership is still breathing.

Arab leaders know this is a proxy war with Iran, and Israel is on their side. Some day they may even find the courage to say so publicly.
Until then, we'll have to settle for more "booyays."

8) Barney’s Great Adventure: The most outspoken man in the House gets some real power.
By Jeffrey Toobin

Of the four hundred and thirty-five members of the House of Representatives, Barney Frank is the only one whose public remarks have been collected in a book of quotations (“Frank Talk: The Wit and Wisdom of Barney Frank,” published in 2006). He is also the only congressman whose fight against the impeachment of President Bill Clinton has been the subject of a documentary, which was shown to acclaim at film festivals around the country (“Let’s Get Frank,” directed by Bart Everly). Frank is not the only member of Congress to have been the subject of a full-scale biography, but the account of his life, written by a former aide named Stuart E. Weisberg, to be published by the University of Massachusetts Press later this year, will likely rank among the more exhaustive and admiring books ever printed about a sitting member of the House, who is described as “arguably the most unique and fascinating, certainly the most entertaining political figure in Washington.”

The title of the book suggests the basis for the widespread interest: “Barney Frank: The Story of America’s Only Left-Handed, Gay, Jewish Congressman.” Now sixty-eight years old, Frank has represented Massachusetts’s Fourth Congressional District since 1981, and he remains best known for his decision, in 1987, to reveal that he is gay, becoming the first member of Congress to do so voluntarily. At the time, the disclosure provoked more curiosity than controversy, but, two years later, Stephen Gobie, a prostitute whom Frank had patronized and then befriended, made a series of lurid allegations about him—claiming that they had had sex in the House gym and that Frank had permitted Gobie to run a prostitution ring out of his home. An investigation by the House Ethics Committee failed to substantiate those charges, though it determined that Frank had written a misleading letter of recommendation for Gobie and had Gobie’s parking tickets waived. Nevertheless, Frank was reëlected with ease, and he became a pointed critic of the Republicans who took control of the House in 1994 and a passionate opponent of Clinton’s impeachment, in 1998. A witty and effective presence on the House floor and in committee rooms, Frank in recent years has settled into the roles of wise guy and wise man of the Democratic Party. (Conservatives “believe that life begins at conception and ends at birth,” he once remarked. More recently, he noted that Barack Obama’s continued insistence that we have one President at a time “overstates the number of Presidents we have.”) In a 2006 poll of Capitol Hill staffers by Washingtonian, published shortly before the elections that gave Democrats control of the House for the first time in twelve years, Frank was voted the brainiest, funniest, and most eloquent congressman—a notable achievement, since he often speaks in a barely comprehensible mumble.

During the financial crisis this fall, Frank’s status as a gay trailblazer suddenly seemed remote and irrelevant. After the Democrats’ victory, he became chairman of the Committee on Financial Services, and Nancy Pelosi, the Speaker of the House, designated him the Democrats’ chief negotiator with the Bush Administration on legislation to address the crises in the banking and auto industries. “Through this all, the quarterback for us is Barney,” Pelosi told me. “He’s solution-oriented, respectful of different perspectives, and brilliant. And it’s brilliance that saves time, because he simplifies the complex for us. He is an enormously valuable intellectual resource for the Congress.”


from the issuecartoon banke-mail thisFor the first time in more than forty years of public life, Frank has real power, and he is wielding it in a characteristically idiosyncratic manner. He remains a national symbol of outré sexuality as well as a rare wit in generally humor-deficient Washington. But in Congress he is thought of no longer simply as a liberal of the old school (which he is) but also as a grind. His expertise is in one of the least glamorous subjects on the national agenda—housing, particularly rental housing for poor people—and he is using that knowledge to confront the nation’s economic crisis. “For Barney, the question has always been: What works? What can government do to see that people have the decent necessities of life?” his sister Ann Lewis, the longtime Democratic activist, says. “Now he’s right there. Barney’s been preparing for this moment for his entire life.”

The contours of Frank’s Massachusetts district have shifted over the years, but his political base has long been the liberal, heavily Jewish suburbs of Newton and Brookline. (Brookline was once part of the district represented by Tip O’Neill, the former Speaker of the House, but he surrendered it to Frank’s predecessor, Father Robert Drinan, saying, according to Frank, “I can’t take all the phone calls. Those nice Jewish ladies even call when they agree with you!”) Much of the campus of Boston College, a Jesuit institution, also lies within Frank’s district, and two days after the recent election he paid a visit to the B.C. Real Estate Council, an alumni group.

Boston College has become a major national university in recent years, but the hundred or so older graduates at the luncheon reflected the school’s Irish-Catholic roots. Frank ambled to the podium in his standard uniform: a monochromatic suit, a white shirt, and a rep tie. The look is an improvement on the dishevelled attire that was once his trademark. When Frank was running for state representative in Boston, in the early nineteen-seventies, a campaign poster featured his photograph and the words “Neatness Isn’t Everything.” In conversation, and even in his speeches, Frank often refers to his lifelong struggle to lose weight, but he is well into his seventh decade, and that battle seems to have been lost, a plight accentuated by his apparent tendency to buy shirts in his aspirational, rather than his actual, size.

Frank never speaks from a prepared text, and he talks so quickly that transcription is nearly impossible. His staff in Washington sometimes posts videos of his remarks on the Web instead. Frank has lived in Massachusetts since he was a freshman at Harvard, in the late nineteen-fifties, but his accent is still marked by a virulent strain of his native New Jersey—he is from Bayonne. (Early in Frank’s congressional career, Toby Moffett, a representative from Connecticut, jokingly asked for U.N.-style simultaneous translations of Frank’s remarks during committee hearings.)

Frank rarely smiles, even when he’s being funny. “There are three lies politicians tell,” he told the real-estate group. “The first is ‘We ran against each other but are still good friends.’ That’s never true. The second is ‘I like campaigning.’ Anyone who tells you they like campaigning is either a liar or a sociopath. Then, there’s ‘I hate to say I told you so.’ ” He went on, “Everybody likes to say ‘I told you so.’ I have found personally that it is one of the few pleasures that improves with age. I can say ‘I told you so’ without taking a pill before, during, or after I do it.” A priest and several older men at my table realized that Frank was talking about sex, and, embarrassed, they stared at their hands. But the moment passed quickly. In Frank’s district, at least, his homosexuality provokes little controversy, even at a Catholic school. (Elsewhere, Frank no longer censors his ribald sense of humor. Not long ago, Paul Begala, the political strategist, was speaking at a fund-raiser for a gay-rights group and said, “When I told my father, back in Texas, that I was speaking to an L.G.B.T. group, he said that sounded like a sandwich.” From the audience, Frank called out, “Sometimes it is!”)

Frank told the group at Boston College that he predicted, and might have prevented, the real-estate crisis that has engulfed the economy. By this time, many aspects of the crisis were well known. The end of the housing bubble had caused home values to plummet and mortgage defaults to rise, particularly among subprime borrowers. Many financial-services firms had assembled mortgages and bought and sold them as securities, and the value of those assets had also declined sharply—a development that devastated the firms. The investment banks Bear Stearns and Lehman Brothers had closed their doors, and the financial-services industry was on the brink of collapse, even after Congress authorized an emergency seven-hundred-billion-dollar bailout, in October.

According to Frank, at the root of the real-estate crisis was a misguided notion that homeownership should be available to all people—what President Bush has called “the ownership society.” “The ‘I told you so’ here is that homeownership is a nice thing but it is not suitable for everybody,” Frank said at Boston College. “There are people in this society who don’t have enough money to be homeowners, and there are people whose lives are not sufficiently integrated for them to take on the responsibility to be a homeowner. And we did too much pushing of people into inappropriate mortgages and into homeownership.” He said that many people would always be renters, and that there was nothing wrong with this. “We need to get back in the business of building rental housing and preserving the housing we have,” he said.

In one respect, Frank went on, the current crisis has had a salutary effect: home prices have fallen, making homes more affordable for those who still have the money to buy them. “But we need to be bringing down the cost of housing in an orderly way, like by building new housing to increase the supply,” he said. “We’ve brought the cost down a little bit in a less orderly way. I tend to eat when I’m under stress. I want to lose twenty-five pounds—but not by Sunday. And that’s how home prices have come down.” (Frank speaks incessantly about food. In “Let’s Get Frank,” he complains about the low-fat provisions given to Democratic members of the Judiciary Committee during the impeachment debate. Referring to Dick Gephardt, who was the Minority Leader at the time, Frank says, “They got all this jelly-doughnut shit in there, and I gotta eat this stuff. . . . Gephardt’s a sheygets—whaddaya expect from Gephardt?” Sheygets is Yiddish for a male Gentile, and thus one who cannot be trusted to provide acceptable snacks.)

Frank arrived in Congress when the Reagan Administration was withdrawing the federal government from the business of building housing for the poor. At the time, it was clear that the private sector had little incentive to build low-income housing without government assistance in the form of tax breaks or subsidies. The Reagan Administration assisted low-income renters by offering them vouchers to help them pay rent and by providing tax credits to local developers who built low-income housing. In subsequent years, Frank has fought with intermittent success to preserve such programs from major budget cuts.

In 2001, Frank embraced a new approach. That year, Bernie Sanders, then a representative from Vermont, sponsored a bill to create a government trust fund that would be used for building and renovating low-income housing. Sanders’s legislation didn’t pass, but the idea was later reintroduced, and Frank backed a proposal for funding the trust with a portion of the annual revenue of Fannie Mae and Freddie Mac—the Federal National Mortgage Association and the Federal Home Mortgage Corporation, the two giant, government-backed mortgage companies. The funding for the trust would be automatic—not subject to annual congressional approval. “I realized, because housing has been a backwater, getting appropriations for housing is going to be tough,” Frank told me. “First of all, if you want to build housing, it can’t be year by year. You know, it’s construction. But, two, I’m finding money outside the appropriations process, money from Fannie Mae and Freddie Mac. So I can do a lot of units without directly competing for the appropriations.”

The idea was based on a variety of similar programs at the state and local levels. In the past few decades, governments across the country have set up nearly six hundred trust funds to build low-income housing, typically by collecting small taxes or fees from real-estate transactions. “There was positive buzz for what was happening with state and local trust funds, but the amounts were really a drop in the bucket,” Barbara Sard, the director of housing policy at the left-leaning Center on Budget and Policy Priorities, said. “But the dream for making a real difference in low-income rental housing has been to do it at the federal level, and that’s what Barney has been trying to do.”

In 2007, Frank used his influence as committee chairman to insure that the housing trust-fund bill finally passed the House. In 2008, a similar measure made it through the Senate as part of a larger bill, which President Bush signed. By that time, however, Fannie and Freddie were mired in debt, and the value of their shares was collapsing. And, because Frank’s committee was supposed to oversee the two mortgage giants, he faced questions about what he might have done to avoid the catastrophe.

The Committee on Financial Services, which has seventy members, is one of the biggest panels in Congress. (It was known as the Banking, Finance, and Urban Affairs Committee until the Democrats lost control of the House in 1994, and Frank attributes the change to “Republican political correctness.”) Congressional hearings customarily begin with statements from members, a practice that can take hours. Frank and Michael Oxley, the Ohio Republican who was his predecessor as chairman, shared a distaste for the tradition, and together they were known as the “impatient caucus.” Still, Frank allows his colleagues to speak briefly before a hearing, and, on October 21st, Scott Garrett, a conservative Republican from New Jersey, used his time to attack Frank—in particular, his claim that he had anticipated the crisis.

“Before we are able to go forward with new and important changes to the over-all regulatory structure for our financial-services industry, I do believe that it is essential that we better understand just how we got into this problem,” Garrett said. “Now, one of the main parts of the problem was poor regulation in the past, specifically in the area of Fannie and Freddie.” According to Garrett, “our distinguished chairman” had no right “to claim the mantle of being a champion of reform with Fannie and Freddie.” On the contrary, Garrett argued, he and other Republicans had wanted to “raise the capital levels, to reduce the retained portfolios, to lower the conforming loan limits.”

Garrett’s accusations were genteel compared with those made by Bill O’Reilly, a few weeks earlier, when Frank appeared on his show on Fox News. “You blame everybody else! You’re a coward!” O’Reilly bellowed. “In any private concern, you’re out on your butt! But not here in the federal government!” Frank, in turn, berated O’Reilly for his “ranting” and “stupidity.” (The confrontation has been viewed more than a million times on YouTube.)

At the hearing, Frank responded testily to Garrett. “The purpose of this hearing was to be forward-looking,” he began. “And I had hoped we could focus on that. But, after the gentleman from New Jersey’s comments in having decried partisanship, he then practiced it. It does seem to me to be important to set the record clearly before us.” Frank pointed out that when Garrett had attempted to tighten regulations on Fannie and Freddie, Republicans had controlled the House. “Had a Republican majority been in favor of passing that bill, they would have done it,” Frank said. “Now he has claimed that it was we Democrats—myself—who blocked things. The number of occasions on which either Newt Gingrich or Tom DeLay consulted me about the specifics of legislation are far fewer than the gentleman from New Jersey seems to think.

“I will acknowledge that during the twelve years of Republican rule I was unable to stop them from impeaching Bill Clinton,” Frank went on. “I was unable to stop them from interfering in Terri Schiavo’s husband’s affairs. I was unable to stop their irresponsible tax cuts, the war in Iraq, and a Patriot Act that did not include civil liberties.” In other words, Frank insisted, if the Republicans had wanted to try to prevent the mortgage crisis, they would have had plenty of opportunities to do so.

Frank and I discussed his role in the housing crisis at his district headquarters, in a small office building in Newton. His boyfriend, Jim Ready, who runs an awning company in Maine, had just returned from Whole Foods with Frank’s lunch, a salad, which he was eating with a noticeable lack of enthusiasm. Frank explained that he first became interested in housing during his service, in the late sixties, as the top aide to Kevin White, who was then the mayor of Boston. The city had a long history of building public housing, mostly high-rises, and White pledged to encourage the construction of small apartment complexes, in keeping with the scale of most Boston neighborhoods.

“At first, when you talk about affordable housing and subsidized housing, people immediately ask, ‘What sort of public housing?’ ” Frank said. “ ‘Is it run by the city, like Cabrini-Green?’ ”—a notorious, now demolished project in Chicago. “And we long ago learned how not to do that, but that still was in people’s heads. And if you can do a word-association test, where a picture floated out in people’s heads, there would be these sterile high-rises. And it struck me, before I conceptualized this, that the answer to that was public-private partnership, that that’s the way to do affordable housing. And then it struck me: You know what? This is the model for other things. Public-private-sector coöperation.”

When White was mayor, one of the most infamous public-housing projects in the city was Columbia Point, in Dorchester. The project was said to be so dangerous that ambulances refused to enter it without a police escort. In a process begun under White, and shepherded in its early days by Frank, Columbia Point was turned over to a private developer, who converted it to a mixed-income community, which included housing for the poor and market-rent apartments for the more affluent. “Barney is a real capitalist,” Joe Corcoran, the developer who took over Columbia Point, told me. “He understands that we have to make a profit. Barney is the smartest politician I’ve ever seen. I have no problem with him being gay, or being Jewish. I like Jews. I like doing business with Jews. They know how to make a deal.”

Frank’s experience in city hall in Boston led to an impatience with abstractions. He recalled a comment by Lawrence Summers, the former president of Harvard, who will be the director of the National Economic Council in the Obama Administration: “Larry said, ‘Oh, well, in the history of the world, nobody ever washed a rented car.’ Well, people wash leased cars all the time. And, secondly, poor people don’t rent cars. It’s just one of those irrelevant things.” Frank went on, “In 2004, it was Bush who started to push Fannie and Freddie into subprime mortgages, because they were boasting about how they were expanding homeownership for low-income people. And I said at the time, ‘Hey—(a) this is going to jeopardize their profitability, but (b) it’s going to put people in homes they can’t afford, and they’re gonna lose them.’ ” (In a recent op-ed piece in the Wall Street Journal, Lawrence B. Lindsey, a former economic adviser to President Bush, wrote that Frank “is the only politician I know who has argued that we needed tighter rules that intentionally produce fewer homeowners and more renters.”) Frank recalled with disdain a Bush Administration proposal to allow time limits on rental vouchers for poor people. “They said, ‘Well, don’t you agree that we should limit the amount of time people have a voucher?’ I said, ‘Yes, if you limit the amount of time they can be poor—“I’m sorry, you can only be poor for four years.” ’ ”

In 2005, while the Democrats were still in the minority, Frank contributed to a bipartisan effort to put his objectives—tighter regulation of Fannie and Freddie and new funds for rental housing—into law. At the time, Fannie and Freddie were regulated by a small agency within the Department of Housing and Urban Development; the bill proposed to create an independent agency to monitor their operations. Frank and Michael Oxley, who was then chairman of the Financial Services Committee, achieved broad bipartisan support for the bill in the committee, and it passed the House. But the Senate never voted on the measure, in part because President Bush was likely to veto it. “If it had passed, that would have been one of the ways we could have reined in the bowling ball going downhill called housing,” Oxley told me. “Barney, to some extent, is misunderstood—with this image of him as a fierce partisan. He is an institutionalist. He believes in the House and in the process. He eschews the grandstanding style that so many members use and prefers to work behind the scenes and get something done.”

Frank’s prescience on the housing crisis should not be overstated, because Fannie and Freddie represented only one aspect of the problem. “Fannie and Freddie were contributors to the bubble, but they came late in the really bad loans, after the private issuers like Merrill and Citigroup,” Dean Baker, the co-director of the Center for Economic and Policy Research, in Washington, said. “The law probably would have curtailed their lending, but it’s hard to say it would have made any difference. The real problem was outside of Fannie and Freddie, with the banks, and nobody in Congress was talking about it.”

Frank hopes that the housing trust fund won’t have to rely entirely on Fannie and Freddie for money. He intends to secure additional funding from, among other sources, the Federal Housing Administration, a division of the Department of Housing and Urban Development which insures mortgages. Specifically, he wants to fund the trust with profits from an F.H.A. program that allows older homeowners to borrow money against the equity in their homes. “We’re going to expand that program, which makes money for the federal government, and start with part of the profits from it,” Frank told me. “If you know how the government works, you can find ways to do what you want.”

The number of housing units that will be built or renovated with funds from the trust is likely to be modest at first. (Frank declined to provide an estimate.) But the money will be available to both nonprofit and commercial developers, fulfilling Frank’s longtime goal of promoting public-private partnerships. “Barney has been our champion in the House, and he has been unbelievably effective,” Sheila Crowley, the president of the National Low Income Housing Coalition, which lobbied for the establishment of the trust, said. “If the bill hadn’t come out of Barney’s committee to the House with universal Democratic support and strong support from moderate Republicans, the Senate wouldn’t have paid any attention. But Barney got it done.”

The bill takes effect this year, but it’s unclear whether the housing trust will work as Frank expects. “I am skeptical that a national housing trust will address the real problems in our housing markets,” Edward Glaeser, a Harvard economics professor who studies the housing market, said. “In many places, there is a lot of housing available at low prices. In Buffalo and throughout the industrial Midwest, there’s loads of low-cost rental housing available. The private sector in Houston does a great job of providing low-cost rental housing without help from the government. The question is whether this program will make a difference in places like New York and San Francisco, where there is a shortage. It’s not obvious that you want to think about new or renovated housing for poor Americans. Poor people buy used cars. There’s no reason to think that used housing isn’t often the right answer as well.” Moreover, it’s not clear that Frank’s determination to avoid the annual congressional appropriations process makes good public policy. “Once you have funding on automatic pilot, the money is spent regardless of what other priorities are there for the federal government and whether it’s properly targeted and properly administered,” David John, who studies housing as a senior fellow at the Heritage Foundation, said. “This is why we have an appropriations process.” Scott Garrett, Frank’s colleague and ideological adversary on the Financial Services Committee, told me, “Barney has a great deal of faith in government’s ability to solve people’s problems. The question is whether that faith is justified.”

When the Republicans won control of Congress in 1994, the Democratic leadership in the House made Frank a kind of one-man immediate-response team to Newt Gingrich, the new House Speaker. Frank and Gingrich sparred almost daily, and Frank still professes surprise that Gingrich took their disagreements personally. “Barney Frank hates me,” Gingrich said at the time. (He would not discuss the matter for this article.) According to Frank, Gingrich is a “bleeder”—a derogatory term for a boxer who is prone to cuts. For Frank, the word has particular resonance: one of his high-school classmates was Chuck Wepner, a heavyweight boxer who was known as the Bayonne Bleeder.

“My first day of high school, I was sent to the vice-principal for discipline, because I got in trouble for talking too much,” Frank told me. “When I got to her office, Chuck was already there. He’d gotten into a fight with the toughest kid in the school.” (In 1975, Wepner went fifteen rounds in a heavyweight championship bout against Muhammad Ali and, in so doing, it has been said, inspired Sylvester Stallone to create the character Rocky.)

Frank’s parents, Sam and Elsie, raised their four children in a distinctly less rarefied setting than the ones in which they all eventually arrived. Sam Frank operated Tooley’s Truck Terminal, near the mouth of the Holland Tunnel in Jersey City. “My father ran a truck stop,” Frank told me. “He sort of lived on the fringes. We’re talking about Hudson County—Frank Hague was the boss—a totally corrupt place. In 1946, my father’s brother Harry got the contract to sell cars to the city, and of course he had to give a kickback to the guys who ran the city. My father was a middleman or something.” Sam was subpoenaed to testify before a grand jury about the matter. He refused and was found in criminal contempt. “For a while, he was hiding out from the cops in New York,” Frank recalled. “I was six years old, and once I went to see him in the city, and we saw ‘Robin Hood,’ with Errol Flynn. The next day, the cops came to my first-grade class to interview me, to see if I had been with my dad. My father’s sister, Aunt Minnie, taught at the school. She heard about the cops coming and went straight to my classroom to break it up, so I didn’t have to talk.”

Eventually, Sam returned to New Jersey, and was jailed for refusing to testify. “They treated him nice,” Frank said. “They let my mother bring him food. He served for about a year.” The incident notwithstanding, Frank’s parents instilled in their children a belief in the power of the government to do good. “We had this great good fortune of growing up with parents who took politics seriously,” Frank’s sister Ann Lewis told me. “The idea that people could choose their leaders was not a small thing in the aftermath of World War II.” Lewis, who is two years older than Frank, said that Frank was outspoken even as a boy. “Our uncle Rosie was a sportswriter, and Barney was a huge Yankees fan, and one day around 1950, when Barney was around ten, Rosie brought home a talent scout for the Yankees,” she said. “And I remember Barney asking the guy why the Yankees didn’t have any black ballplayers. I was very struck by that. I looked at the kid, and I thought, That’s a really tough thing to do. Good for you.”

“Barney was a famous person at sixteen,” Alan Dershowitz, the Harvard Law School professor, who dated a classmate of Frank’s at Bayonne High School, said. “He talked exactly like he talks now, and he was always talking, always involved in every kind of politics. Because Bayonne was such a sleazy place, nobody knew whether Barney was going to wind up in Congress or in jail.” According to Frank, his father was involved with the Mafia. “Funzi Tieri, a big-time gangster with the Genovese family, came to my brother David’s bar mitzvah, when I was twenty-three,” he said. Sam Frank died at the age of fifty-three, while Barney was an undergraduate at Harvard, and Barney took a year off to help resolve the family’s tangled financial affairs. “The Mafia guys were very helpful to me at the time,” he said.

All four Frank children settled far from Bayonne. Ann Lewis, the eldest, was the director of communications in the Clinton White House and a top aide to Hillary Clinton during her Presidential campaign. David Frank works as a speechwriter for the A.A.R.P., and Doris Breay is an administrator at Brandeis University who frequently campaigns for her brother. In the nineteen-seventies, Elsie Frank moved to Boston and later became the president of the Massachusetts Association of Older Americans. During Barney’s first reëlection campaign, in 1982—a tough race, because redistricting forced him to run against another incumbent, Margaret Heckler—Elsie was featured in a series of television commercials for her son. She died in 2005.

Earlier this fall, the Democrats in the House had to take sides when Henry Waxman, of California, challenged John Dingell, of Michigan, for the chairmanship of the Committee on Energy and Commerce, which Dingell had held for a year. (Dingell also chaired the committee from 1981 to 1995.) The contest represented a classic ideological confrontation between the left and the center of the Democratic Party. As chairman of the House oversight committee, Waxman, an outspoken, pro-environment liberal, led high-profile investigations of Republican wrongdoings, while Dingell, a pro-labor moderate, is known as a behind-the-scenes player, often on behalf of the automobile industry.

Frank voted for Dingell, who lost, 137–122. “I thought Henry was making a great mistake,” Frank told me in his office in the Rayburn House Office Building. “One of the advantages we have today is that we appear to be much less ideologically driven than the Republicans. I think there is a danger of what will look like liberal overreach. We need all the moderates to pass legislation, even at two hundred and fifty-seven”—the number of Democrats in the House after the 2008 election. “If Dingell and Waxman were running ab initio, I’d vote for Waxman. But I do think there should be some burden of proof before you throw out a chairman.”

To the public, Frank looks much like Waxman—a blunt partisan with a flair for sound bites—but, like Dingell, he has a record as a pragmatic legislator. He graduated from Harvard in 1962 and began a long, ultimately unsuccessful quest there for a Ph.D. in government. (I once asked him the subject of his planned dissertation. “The Massachusetts legislature,” he told me. What about the legislature? “I never got much farther than that,” he said. He later attended Harvard Law School, and graduated in 1977.) In the mid-sixties, as a teaching assistant at Harvard, Frank lived on campus and had time for non-academic pursuits. He spent five weeks registering black voters in Mississippi, and travelled around the country as an organizer for the activist Allard Lowenstein, an early leader of what would become the student movement of the late sixties. Frank also befriended a group of young, reform-oriented politicians, who hoped to wrest control of the commonwealth from the long-serving Democratic Party stalwarts who dominated state government. In time, his circle of politician friends coalesced into an entity known as the Democratic Study Group, for which Frank served as an unpaid executive director, and which quickly came to center on a young state representative from Brookline named Michael Dukakis.

“At the time, Massachusetts was one of the three or four most corrupt states in the country,” Dukakis told me. “About twenty or thirty of us young reform types decided to start a little organization that would give us some clout, on basic progressive legislation and conflict-of-interest and integrity stuff. We persuaded Barney to take the Red Line down from Harvard to be our staff guy—for free. He hasn’t changed. He was smart as hell and funny as hell and worked like hell.”

In 1967, Frank was invited to work on Kevin White’s first campaign for mayor of Boston. White, who was thirty-eight, belonged to a generation of charismatic young politicians—including John V. Lindsay, in New York—who ran on platforms dedicated to empowering neighborhoods and cooling inner-city tensions, and he narrowly defeated Louise Day Hicks, a former chairperson of the Boston School Committee, who opposed the desegregation of local public schools. “The White administration was an incredible burst of energy, and Barney was effectively Kevin’s chief of staff,” Fred Salvucci, who ran White’s “little city hall,” in East Boston, said. “We stopped the expansion of Logan Airport, traded highway funds for mass transit, did all this stuff, and Barney was the guy we went to for answers. Other than saying, ‘Talk faster, I’m busy,’ because his mind was working faster than mine, he was great to work with, even though I couldn’t understand his accent a lot of the time.”

In 1972, Frank ran for state representative in a district that included much of Boston’s Back Bay. He profited from student enthusiasm about the Presidential race that year. “I am one of the few people in the country who can say he benefitted from George McGovern’s coattails,” he has said. Once elected, Frank became known for witty banter and harsh partisanship. After Michael Dukakis won the governorship, in 1974, Frank became one of his most vociferous critics, repeatedly accusing him of betraying his liberal principles.

“I inherited a mess,” Dukakis told me. “The state was a shambles, with twelve and a half per cent unemployment. Time magazine was calling us the New Appalachia. It was depressing stuff. I had to do some hard cutting, and Barney was upset about it, and I can understand why.” Liberal outrage at Dukakis grew so intense that in the 1978 election he drew a primary challenger from the left, Barbara Ackerman, a former mayor of Cambridge, in addition to an opponent from the right, Edward J. King, a pro-business former football player. Frank endorsed Ackerman over Dukakis. “The real point of Ackerman’s campaign,” Barney told his biographer, Stuart Weisberg, “was to show Dukakis that there was a price to be paid for hurting poor people.”

King defeated Dukakis in the Democratic primary and went on to become a conservative governor. “Yeah, I didn’t see Ed King coming on as strongly as he did,” Frank told me. “I was very angry at Mike. And I thought he was doing permanent damage to liberalism.” Frank insists that Ackerman did not cost Dukakis the primary, but he remains troubled by his misjudgment in the race.

Two years later, in 1980, Pope John Paul II instructed priests to withdraw from electoral politics, and Father Robert Drinan, at that time the congressman representing Massachusetts’s Fourth District, complied by not running for reëlection. Frank, with Drinan’s endorsement, easily won the general election. (Afterward, Frank joked about papal infallibility.) In 1982, Dukakis defeated King in a rematch and served two more terms as governor. He said that he had no hard feelings for Frank. “He has always been a strong progressive force around here,” Dukakis said. “He’s a guy who still represents me in Congress and does so very well.”

Frank’s role in crafting the government’s response to the current economic crisis suggests both the promise and the limitations of his pragmatic liberalism. On the evening of Thursday, September 18th, during one of the most tumultuous weeks in American economic history, Frank was summoned to an emergency meeting in the office of Nancy Pelosi. That Monday, the federal government had declined to intercede as Lehman Brothers, the investment-banking firm, declared bankruptcy. But the following day the Federal Reserve provided American International Group, the insurance company, with a bailout worth eighty-five billion dollars, to prevent it from going out of business. Many in Congress viewed these developments with alarm.

“On that Thursday afternoon, I was meeting with my leadership, and I realized I had not heard from Hank Paulson”—the Treasury Secretary—“that day about the markets,” Pelosi told me. “So, because the situation was looking chaotic, I called Hank and said I wanted him to come in the following morning at 9 A.M. with Ben Bernanke”—the chairman of the Federal Reserve—“to brief me and the whole Democratic leadership. I reached him at about 3 P.M., and he said tomorrow morning might be too late. He had to come by that night.”

Pelosi asked Frank and a bipartisan group of senators and representatives to meet with the Administration officials in her office. “That evening, when we met with them, they painted a very dismal picture,” Pelosi continued. “They said if we don’t act now we may not have an economy on Monday night.” Paulson proposed that Congress authorize the Treasury Department to buy large amounts of the so-called toxic assets—mostly mortgage-backed securities—from financial-services companies that were on the brink of collapse. “We kept asking them, ‘Why do you want to buy these assets?’ ” Pelosi said. “ ‘Why not just buy their stock to recapitalize them?’ They just said this was their break-the-glass project—‘In case of emergency, break glass.’ It was waiting in the wings, and they wanted to use it. Harry Reid”—the Senate Majority Leader—“kept asking how much it would cost, and Paulson wouldn’t commit to a number.”

Frank laid out the provisions that the Democrats wanted in a bailout bill: equity for the taxpayers, like any other investors; a program to limit foreclosures for beleaguered homeowners; compensation reform for executives at companies receiving bailout funds; and strict congressional oversight of the whole process. Two days later, on Saturday, September 20th, the Treasury Department sent Congress a formal proposal of sorts. In a text just three pages long, the Treasury asked for seven hundred billion dollars from Congress but provided few details about how the Administration would spend the money. “It was just ridiculous,” Pelosi told me. “They wanted us to surrender all authority and give them seven hundred billion dollars.”

Throughout the weekend, Frank and Chris Dodd, the Democratic senator from Connecticut and the chairman of the Senate banking committee, worked with colleagues in both parties to come up with a plan that they thought could win widespread support. The following Wednesday, September 24th, John McCain, the Republican Presidential nominee, announced that he was suspending his campaign and returning to Washington to address the crisis. Although McCain had played no part in the negotiations, the White House promptly scheduled a meeting of the President, the congressional leadership, and the two Presidential candidates for the following afternoon, Thursday, September 25th. By this time, a deal seemed to be in place. Congressional leaders announced that they had agreed in principle to an amended version of the Administration’s bailout proposal. Before the meeting, the Democrats at the White House, including Frank, Pelosi, and Barack Obama, had caucused privately in the Roosevelt Room about their strategy for the day. “Barack said, ‘I think we need to go ahead with this,’ ” Frank recalled. “He was being conciliatory, because he thinks it’s very important for us, both in public policy and politically, that we don’t get blamed for fucking up the economy. And that we not fuck up the economy.”

The meeting with the President nearly destroyed the good will that had been generated during the previous week. John Boehner, the Republican leader in the House, expressed disapproval of the proposal, arguing that it did not reflect a bipartisan consensus. Frank tried to put McCain on the spot: would he back the House Republicans or Bush and the rest of the congressional leadership? As Frank recalled, “I said, ‘John, what do you think?’ ‘Well, I think the House Republicans have a right to their position.’ ‘Fine. You agree with that position?’ ‘No, I just think they have a right to their position.’ He looks like your old uncle, just shrivelled and shrunk, and he just didn’t look good. And we kept pressing him, saying, ‘What is your plan?’ ” McCain wouldn’t say.

“The protocol is you’re not supposed to talk to the President directly,” Frank said. “We just ignored that.” But the President didn’t bring the group together, and the meeting ended without a decision. The Democrats returned to the Roosevelt Room to plot their next move, and Paulson joined them. As Frank recalled, Paulson “literally drops to the one knee” and begged Pelosi to bring the bailout up for a vote in the House, despite the Republican opposition. “But we start yelling at him,” Frank said. “ ‘Jeez, work on your assholes over there—your guys. I mean, you know, we’re trying to do it, and your guys are playing games.’ ”

Two tumultuous votes in the House followed. On September 29th, the bailout was unexpectedly defeated, 228–205, and the Dow Jones Industrial Average plunged seven hundred and seventy-eight points. Congressional leaders and Administration officials made small, mostly cosmetic changes to the bill and, citing the turmoil in the stock market, urged their colleagues to support the measure. On October 3rd, the revised bill passed the House, 263–171. What Frank and the other sponsors of the bailout actually accomplished, however, remains uncertain.

It appears that Frank failed to achieve three of his four initial objectives. The Treasury Department eventually did make direct investments in financial-services firms, but the bill includes few meaningful restrictions on executive compensation, and the oversight provision will likely have only a modest influence on how the bailout money is distributed and spent.

One of Frank’s primary goals for the bailout—providing assistance to homeowners to avoid foreclosures—remains unrealized, even though the Treasury Department has already allocated half of the seven hundred billion dollars. On November 20th, Frank wrote a letter to Paulson, “to urge you in the strongest possible terms to use [bailout] funds to support significant steps that can help stem the tidal wave of foreclosures threatening the stability of our financial system and our economy.” He has held committee hearings to praise banks like J. P. Morgan Chase and Bank of America, which have instituted programs to modify the terms of some mortgages. He has urged support for a proposal by Sheila Bair, the chairman of the Federal Deposit Insurance Corporation, to enable homeowners to renegotiate mortgages and, potentially, prevent an estimated one and a half million foreclosures this year.

Frank defends the bailout legislation. “Sure, this sucks,” he told me, “but if it wasn’t for what we did, it would suck worse. We were looking at the possibility of a global economic collapse, and that didn’t happen. We are better off than if we hadn’t passed it.” I asked him whether he thought his efforts to force the Administration to modify the bailout, especially on foreclosures, were having any effect. “Jack Newfield, while writing for the Voice under Lindsay, said he didn’t have any governmental power—he had the power to make the dinner parties of the Lindsay-administration officials unpleasant,” Frank replied. “That was his pressure point. That’s part of it. You know, no one, almost no one, is totally indifferent to public opinion. So you have hearings to pressure people. People don’t like to be embarrassed. You have hearings to send messages. So they can have an impact. Sometimes they’re a waste of time. And you can get too diffused. But I think these hearings had some impact.” At the moment, Frank can claim that he played a significant role in creating a tenuous lifeline for banks and other institutions (many of which have yet to resume normal lending), while encouraging the federal government to provide some assistance to terrified homeowners (which may not happen).

In November, Pelosi asked Frank to lead the effort in the House to pass another bailout, for the Big Three American carmakers. On the morning of December 5th, the day that Frank had summoned the chief executives of General Motors, Ford, and Chrysler to testify before his committee, the government reported that the unemployment rate had jumped from 6.5 per cent to 6.7 per cent in a single month. Frank used that news to inject a note of drama into his opening statement. “Context is especially important this morning,” he said. “A failure, to some extent, of three of our major domestic manufacturing entities would be a very serious problem in any case. In the midst of the worst economic situation since the Great Depression, it would be an unmitigated disaster.” Opposition from Senate Republicans prevented legislation to rescue the automakers from coming up for a vote. On December 19th, President Bush used his executive authority to offer $13.4 billion in loans from the federal bailout fund to General Motors and Chrysler, which appeared to be enough to enable the companies to survive for a few months—until the new Congress and the Obama Administration devise a long-term recovery plan. “I think what Bush did was right,” Frank told me. “He kept the companies alive until Obama takes over.”

In 1986, Frank approached Tip O’Neill on the House floor to tell him that a forthcoming book would refer to Frank as a gay man. “He said, ‘Oh, Barney, don’t listen to that crap,’ ” Frank recalled. “They say stuff like that about all of us.’ I said, ‘Well, Tip, it’s true.’ And he sort of slumped in his chair and said, ‘Oh, Barney, I’m so sad. I thought you might be the first Jewish Speaker.’ ” (O’Neill, who had little facility for contemporary slang, prepared his staffers by saying that Frank had decided to “come out of the room.”) Two decades later, Frank’s ascendancy in Congress suggests that O’Neill had too little faith in Frank—and in the ability of the country to change.

Frank’s work as a committee chairman absorbs virtually all his time, but he is also, unofficially, the congressman for gay America. “I remember when I first came to Congress, twenty-one years ago,” Nancy Pelosi told me. “And I heard a congressman, William Dannemeyer, on the floor, saying the most hateful things about AIDS and gay people. It was regular fare at the time. I just didn’t get it. And I called Barney to see what we could do about it. And he said, ‘Why are you calling me? Go down there and challenge him!’ ”

Frank remains a sporadic target for anti-gay-rights groups. In the 2006 campaign, John Hostettler, a Republican congressman from Indiana, ran a radio ad that said, “Pelosi will then put in motion her radical plan to advance the homosexual agenda, led by Barney Frank, reprimanded by the House after paying for sex with a man who ran a gay brothel out of Congressman Frank’s home.” (In 1990, the House Ethics Committee rejected the charge that Frank knew about the prostitution ring, which was for straight men.) Asked about his gay agenda, Frank says, “I do not think that any self-respecting radical in history would have considered advocating people’s rights to get married, join the Army, and earn a living as a terribly inspiring revolutionary platform.” (Hostettler lost the 2006 race.)

Frank’s mordant view of human nature presents a contrast to the sunnier approach of President-elect Obama, a difference reflected in their dispute over Obama’s choice to have Rick Warren, the evangelical pastor, give the invocation at the Inauguration. “Obama tends to overstate his ability to get people to change their opinions and underestimates the importance of confronting ideological differences,” Frank told me. “It’s one thing to talk to somebody. I talk to more conservatives than anyone, because I’m trying to get legislation passed. But it’s another to make Rick Warren the most honored clergyman in the world.” In California, Warren supported Proposition 8, the successful anti-gay-marriage referendum. “Now, when we fight Warren in California, we are going to hear, ‘Oh, yeah, but Obama picked him for the inaugural.’ He doesn’t deserve that honor. And I don’t want to hear that the other clergyman at the inaugural, Reverend [Joseph] Lowery, supports gay rights. I didn’t vote for a tie in the election.”

Frank worries that Obama’s evenhandedness may prove to be a political liability. “On the financial crisis, Obama said that both sides were asleep at the switch,” Frank said. “But that’s not true. The Republicans were wide awake, and they made choices to oppose regulation. They had bad ideas. He says, ‘I don’t want to fight the fights of the nineties,’ but I don’t see any alternative to refighting the fights of the nineties if we want to change things.”

Still, Frank is uncharacteristically hopeful about the future, including gay rights. “We’re going to do three things in Congress,” he told me. “First, a hate-crimes bill—that shouldn’t be too hard. Next, employment discrimination. We almost got that through before, but now we can win even if we add transgender protections, which we are going to do. And finally, after the troops get home from Iraq, gays in the military. The time has come.”

To Frank, the future looks bright even for the economy. In 2009, he predicts, the federal government will take steps to stop some foreclosures, and produce a stimulus package that will reinvigorate the economy. “It will all work together, and it will work,” he said. “Obama’s almost lucky. He can do all these things on the economy, and both the real and psychological effect of what he’s doing is going to kick in soon after he takes office. And the recovery is going to start about six months before the 2010 elections. That’s pretty good.”

In 2004, when it appeared that John Kerry might win the Presidency, Frank prepared to run for Kerry’s Senate seat. But Frank’s age and the committee chairmanship suggest that he is likely to remain where he is. In October, he began holding hearings on how to transform the laws that govern banks and financial-services companies, with the goal of reforming the system so that the current crisis will not recur. “We are at a moment now when liberalism is poised to have its biggest impact on America since Roosevelt, because the conservative viewpoint has been so thoroughly repudiated by reality,” Frank said. “Someone asked Harold Macmillan what has the most impact on political decisions. He said, ‘Events, dear boy, events.’ Events have just totally repudiated them, and we’re now in a position to take advantage of that.” He went on, “You know Hegel. Thesis: No regulation at all. Antithesis: Now the government owns the banks. What I gotta do next year is the synthesis.”

9) The Coming Rift
By Abe Greenwald

Pundits are fond of talking about the disconnect between the GOP and the American electorate. Conservatives are out of step, so the wisdom goes. They need to drop the frightening Pentecostalism of Sarah Palin and the bellicosity of John McCain. Republicans must consider dismantling the whole trickle-down apparatus and turning their direct attention to the neglected segment of the population for whom “the promise of America,” as Barack Obama likes to call it, remains unfulfilled.

True, voters may not be in sync with Republican leaders. But if the current political climate is any indication, they could end up feeling mightily betrayed by Democratic ones.

Since November’s supposed referendum on Republican ideology, a string of Democratic figures has been sullied by impropriety and entitlement while other members of the party are making an airtight case for the timeliness and resiliency of conservatism. On matters of foreign policy, social policy, and economics, Democratic leadership is largely indistinguishable from the Republican variety. And Democratic voters have noticed. On Saturday, Glen Greenwald complained in the Chicago Sun Times

It's not at all surprising that Republican leaders -- from Dick Cheney and John Bolton to virtually all appendages of the right-wing noise machine -- are unquestioning supporters of the Israeli attack. After all, they're expressing the core ideology of the overwhelming majority of their voters and audience.

Much more notable is the fact that Democratic leaders -- including Harry Reid and Nancy Pelosi -- are just as lock step in their blind, uncritical support for the Israeli attack, in their absolute refusal to utter a word of criticism of, or even reservations about, Israeli actions.

Did Greenwald (no relation, by the way) expect a stirring defense of a terrorist organization? Maybe, maybe not, but the important thing is that whatever Reid or Pelosi said (or failed to say) about the Gaza operation, it was troubling to most of those who voted for them. Greenwald noted that “Democratic voters overwhelmingly oppose the Israeli offensive -- by a 24-point margin,” and went on to write, “is there any other position, besides Israel, where a party's voters overwhelmingly embrace one position (Israel should not have attacked Gaza) but that party's leadership unanimously embraces the exact opposite position (Israel was absolutely right to attack Gaza and the U.S. must support Israel unequivocally)?”

Funny he should ask. There’s the Iraq War. A December Washington Post/ABC News poll found that 7 in 10 voters believed that Obama “should fulfill his campaign promise to withdraw U.S. forces from Iraq within 16 months.” If that figure represents the average voter, we can safely assume that more than 70 percent of Democratic voters supported this sentiment. But as Eli Lake argued in an indispensable New Republic article from Christmas Eve, “For all the talk of withdrawal and timetables, however, nothing like that is likely to happen.”

What is likely to happen is that President Obama will stick to the ratified status of forces agreement, keeping troops in Iraq for three more years and allowing for a renegotiation which will probably keep troops there a good deal longer, if not indefinitely. This likelihood is, of course, of a piece with Obama’s choice to stick with George W. Bush’s last Secretary of Defense Robert Gates.

There’s gay marriage. In October, Michelle Obama stood before a gay and lesbian Chicago audience and said, "I feel like I'm preaching to the choir because you know Barack's record" on "issues of interest to the LGBT community." Maybe they didn’t know as much as the future first lady assumed. Between the President-elect’s previously ignored stand against gay marriage, Proposition 8 support from a key Obama voting bloc, and his scheduling of Rick Warren to give the invocation at his presidential inauguration, the liberal gay community isn’t quite sure what hit it. As the Washington Editor at Large for the Huffington Post put it on CNN, “From what I gather, every gay person who paid attention to this [the Warren announcement] today felt like we were kicked in the stomach.” Democratic leadership’s opposition to gay marriage certainly isn’t what Glen Greenwald might call “unanimous,” but it’s strong enough and comes from a high enough office to smart.

On the economic front, what Larry Kudlow deems “a pleasant surprise” has the spread-the-wealth crowd in a tizzy. The punitive tax hike on the “rich” that Obama spoke about throughout the campaign is on hold, while a program of new business tax cuts and personal tax credits has been offered in its place. Again, the base is watching. At the progressive Campaign for America’s Future blog, President-elect Obama has been accused of “buying into the right-wing frame that raising any taxes - even those on the richest citizens and wealthiest corporations - is bad for the economy.” That’s about right.

Open-ended global instability has made certain that the U.S. will stick to the most vital Bush national security positions. Similarly, economic uncertainty requires the continuation of the Bush tax cuts and the indefinite postponement of pie-in-the-sky entitlements. Despite the campaign scraps thrown to the left-wing chorus and the sham apologetics offered to the international community, many liberal policies have been temporarily rendered non-starters. But if Democratic leaders are resigned to the judicious employment of conservative principles, and Democratic voters are not, where is the party heading?

It’s hard to say, but it can’t hurt to look at how this gap came about. One place to start is with the netroots. The runaway train of preposterous (and liberal) expectations that delivered Barack Obama into the White House first gained speed as a runaway train full of preposterous accusations against George W. Bush. With their cartoonish demonization of every Bush policy and associate, groups like the Daily Kos and Moveon.org made it impossible for any liberal with a web browser to give a single conservative policy a fair shake. Barack Obama’s exploitation and mobilization of this online hysteria made for an unstoppable campaign, but also for an illusory state of political affairs. Democratic politicians, President-elect Obama included, always knew better than the frenzied multitude that voted in “change.” But the netroots were duped as a result of their own momentum.

It’s too early to know how the betrayed will repay their leaders in the next Congressional or Presidential elections, but if Democratic fragmentation is to be avoided down the line, perhaps the introspection about re-branding, redefining, and reaching out needs to happen on the Left.

10) We must stop arming Israel: Brown has to stop sitting on his hands, halt British weapons exports and insist the EU do the same.
By Nick Clegg

The world watched in horror yesterday as the conflict in Gaza claimed its latest innocent victims in the rubble of a UN school. Any hopes of reconciliation are being snuffed out as anger spills into protests around the world.

The past two weeks have been a telling indictment of the international community. We have an outgoing US president sanctioning Israel's military response and an aching silence from the president-elect. We have a European Union encumbered by clumsy decision-making and confused messages.

And at home we have a prime minister talking like an accountant about aid earmarked for Gaza without once saying anything meaningful about the conflict's origins. Gordon Brown, like Tony Blair, has made British foreign policy effectively subservient to Washington. But waiting for a change of heart in Washington is intolerable given the human cost.

Of course, Israel has every right to defend itself. It is difficult to imagine what it must be like to live with the constant threat of rocket attacks from a movement which espouses terrorist violence and denies Israel's right to exist. But Israel's approach is self-defeating: the overwhelming use of force, the unacceptable loss of civilian lives, is radicalising moderate opinion among Palestinians and throughout the Arab world. Anger in the West Bank will make it virtually impossible for Mahmoud Abbas, the Palestinian Authority president, to continue to talk to Israeli ministers.

Brown must stop sitting on his hands. He must condemn unambiguously Israel's tactics, just as he has rightly condemned Hamas's rocket attacks. Then he must lead the EU into using its economic and diplomatic leverage in the region to broker peace. The EU is by far Israel's biggest export market, and by far the biggest donor to the Palestinians. It must immediately suspend the proposed new cooperation agreement with Israel until things change in Gaza, and apply tough conditions on any long-term assistance to the Palestinian community.

Brown must also halt Britain's arms exports to Israel, and persuade our EU counterparts to do the same. The government's own figures show Britain is selling more and more weapons to Israel, despite the questions about the country's use of force. In 2007, our government approved £6m of arms exports. In 2008, it licensed sales 12 times as fast: £20m in the first three months alone.

There is a strong case that, given the Gaza conflict, any military exports contravene EU licensing criteria. Reports, though denied, that Israel is using illegal cluster munitions and white phosphorus should heighten our caution. I want an immediate suspension of all arms exports from the EU, but if that cannot be secured, Brown must act unilaterally.

Finally, the world's leaders must accept that their response to the election of Hamas has been a strategic failure. The removal of the EU presence on the Egypt border in response to Hamas's election, for example, has made it easier for the rockets being fired at Israel to get into Gaza in the first place. An EU mission with a serious mandate and backing from Egypt and Israel would help Israel deal proportionately and effectively with the threat from weapons smuggling.

Attempts to divide and rule the Palestinians by isolating and punishing Gaza will not succeed. To secure peace in the Middle East, Hamas must turn its back on terrorism, and help create Palestinian unity. Only unified leadership in the West Bank and Gaza can offer Israel the security guarantees that it rightly seeks.

My proposals to stay Israel's hand in this conflict may be unwelcome to some, but they have the country's long term interest at heart. No terrorist organisation has ever been defeated by bombs alone. Only a new approach will secure lasting peace for Israel itself.