Socialism is Killing Social Security!

Obama can flip and flop and he is considered wise for listening to his advisors. Would the same be said for GW and Cheney? Media and press hypocrisy rains/reigns! (See 1 below.)

The Washngton Post editorializes. It will be interesting to see how far Obama is willing to go in rubbing Irael's nose into the ground should Netanyahu continue to raise Israeli security concerns as a condition precedent, which seems likely.

Obama and Netanyahu have met and we learned what we already knew -the the two live on different planets.

Obama believes in a two state solution which is unrealistic and Netanyahu repeats that security of his nation is critical and an uncompromising necessity.

Then why is Obama in a position to impose on Israel whatever he chooses assuming he is willing to pay some modest political price? Because the world has demonstrated he can and Israel will be blamed for being the fly in the ointment!

A few reasons why this is so:

Israel defeated its many Arab attackers, Israel occupied Arab land won in war and recaptured some of its own lost in previous wars, Carter says Israel is an Apartheid State, anti-Semitism rises as Muslims invade Europe, European poll reveals a majority believe Israel is world's most dangerous nation, U.N. constantly attacks Israel.

Israel and the Palestinians agree to negotiate according to a GW authored plan which stipulated terrorism must first cease, Israel returns Gaza but received no peace, Israel defends itself against persistent Hezballah and Hamas rocket attacks, world says Israel engaged in disproportionate force and Arab terrorists have been allowed to morph into 'freedom fighters.'

Meanwhile,Iran builds nuclear facilities, launching missile and publicly states its intention "to wipe Israel off the Map." Euoropean nations negotiated for 6 years while Iran continued its nuclear development and Iran barred U.N. 'watchdog' inspectors.

Obama now wants to negotiate with Iran and is allowing Iran 6 months more to continue building their nuclear program and perfect their missile delivery systems. Yes, N Korea is even ready to launch another nuclear test. Obama warns Israel not to attack Iran without his say so.

Israel is being boxed into a corner, morality has been flipped on its head once again because the world is full of feckless appeasers (more Chamberlains) who have bought into Arab propaganda and because the West is dependent upon Middle East oil.

Most importantly Obama believes he is the 'messiah' who can get bullies to eat from one hand while holding no sticks in the other.

Strange, how history has a way of repeating itself. (See 2 below.)

And the caving has already begun as an ex-AIPACer asserts Iran must be allowed to have a 'peaceful' nulcear program because there is nothing that can be done to deter them. (See 2a below.)


Squeezing 6' Americans into smaller cars could prove this Administration's undoing.
Nuclear power would go a long way towards solving the problem Obama believes small cars cure but Obama has become an industrialist president and has 120 days experience to back it!

We may be too dumb to understand economics but we love our cars! (See 3 below.)

When our government turned towards Socialism and FDR created the Social Security Program, Congress' continued general spending beyond tax inflows which eventually placed Social Security in jeapordy. This year the program paid out more than it took in and in less than two decades it will be in further dire financial straits. Unbridled Socialism killed Socialism. Yet, no politician is willing to address the Social Security issue and when GW limply tried he failed. However, every politician is willing to add his two cents when it comes to curbing unbridled Capitalism


The cure- more bureaucracy is being proposed by Obama to solve the dilemma we got ourselves into because we cannot curb our spending appetite, desire to have what we cannot afford and/or stupidly believe there is a free lunch. Consequently, another government agency to protect us from the government agency that failed is now being considered. And so it goes in Disney East! (See 4 below.)

My friend, John Podhoretz, calls Klein what he has proven to be - a small man. I would add Klein is also insigificant. (See 5 below.)


Dick

1) When Reality Sets In
By Ruben Navarrette

When it comes to the war on terror, or what his administration has re-branded the "Overseas Contingency Operation," President Obama has matured quickly and has come to grips with some unpleasant realities.

Too bad the same can't be said about some of his disillusioned supporters, especially pundits and others in the media. They expected the president to repudiate George W. Bush's policies, not adopt them as his own. Yet they still don't feel comfortable criticizing Obama. So that requires some rhetorical finessing.

As an example, consider James Carville, a fixture on Washington Sunday talk shows. Asked during an appearance on ABC's "This Week" if he agreed with Obama's decision to reserve his earlier consent to releasing photos showing purported prisoner abuse at U.S. military facilities in Iraq and Afghanistan, the Democratic strategist insisted that he had no complaints.

"As a Democrat I'm very happy that he decided to listen to his commanders," Carville said, noting that Obama had made his reversal after military leaders said the photos could endanger U.S. soldiers on the battlefields.

I don't recall Carville looking so favorably on this argument when it was coming from conservatives such as former Vice President Dick Cheney.

Obama's not getting as much sympathy from advocacy groups such as the American Civil Liberties Union, Human Rights Watch and others.

Those groups are furious now that the Obama administration is considering adopting a policy for which the Bush team was harshly criticized -- suspending habeas corpus and holding terror suspects indefinitely and without trial. It's being marketed as part of a plan to improve upon the military tribunals conducted for prisoners at Guantanamo Bay. Under this scenario, however, some of the prisoners would be held on U.S. soil since Obama has vowed to close the military prison.

Members of Congress cried foul over the prospect that terrorism suspects could be detained in their districts, so the administration tried a different tack. Attorney General Eric Holder recently told a congressional committee that if the administration had proof that a prisoner intended to harm the United States, "we will do all that we can to ensure that that person remains detained and does not become a danger to the American people." But the minute a government official says something like that, they're negating the possibility of a trial because trials sometimes end in acquittals after which the accused is free to go on his way. If the administration isn't prepared to risk that, there's not likely to be a trial.

The advocacy groups caught it. The ACLU said in a statement: "These military commissions are inherently illegitimate, unconstitutional and incapable of delivering outcomes we can trust." Human Rights Watch said: "By resurrecting this failed Bush administration idea, President Obama is backtracking dangerously on his reform agenda." Human Rights First added: "Reinventing commissions so deeply associated with Guantanamo Bay will merely add to the erosion of international confidence in American justice, provide more fodder for America's enemies."

This isn't the first time that the Obama administration has disappointed civil libertarians. Last month, after releasing Bush-era Justice Department memos spelling out the legal justification for enhanced interrogation techniques that some label torture, the president initially signaled that he wasn't interested in prosecuting the lawyers who wrote the legal opinions. Saying he wanted to look forward and not backward, Obama seemed ready to put the matter to rest. But, under pressure from the left, the president flipped and said the question of whether to prosecute was for Holder to decide.

Before that, Obama signed an executive order preserving the CIA's authority to carry out "rendition" -- the secret abductions and transfers of prisoners to other countries where some of them claim to have been tortured. The Obama Justice Department also took the position -- identical to that of the Bush administration -- that the 600 prisoners at Bagram air base in Afghanistan cannot use U.S. courts to challenge their detention and tried to quash -- in another example of cutting and pasting Bush policy -- a lawsuit challenging the government's rendition and warrantless wiretap programs.

These are the same policies that Bush's critics used to howl about because it made them feel morally superior. Now, as they continue to lend their support to a new president traveling down a familiar road, they should just feel foolish.

2)Opening Bids:President Obama and Israel's new prime minister take each other's measure.

IT WAS not hard to discern the incipient cracks in U.S.-Israeli relations behind the show of friendliness between President Obama and Israeli Prime Minister Binyamin Netanyahu at the White House on Monday. Mr. Obama spoke about the need for "serious movement" toward a "two-state solution" ; Mr. Netanyahu pointedly avoided any mention of statehood for Palestinians. The Israeli leader harped on the urgency of preventing Iran from acquiring nuclear weapons and the need to leave "all options on the table"; Mr. Obama said that until the end of this year, options other than negotiations would not be on the table. Mr. Obama stressed that Israeli settlements in the West Bank "have to be stopped in order for us to move forward"; Mr. Netanyahu, who is committed to the "natural growth" of settlements, said any action would have to be linked to reciprocal steps by the Palestinians.

The cracks need not widen into a split. But if their public statements were any indication, Mr. Obama and Mr. Netanyahu gave little ground in the hour and 45 minutes they spent together one-on-one. Afterward, Mr. Obama was particularly striking in saying that "the United States is going to roll up our sleeves" and be "a strong partner" in seeking the Palestinian state that Mr. Netanyahu resists. If that's true, the president's frankness was a necessary first step. Neither Mr. Netanyahu's government nor Palestinian and Arab leaders are likely to make the concessions needed for peace without concerted and visible pushing from the White House.

The administration's strategy seems to center on broadening Israeli-Palestinian talks to include Arab states and outside powers such as the European Union and Russia. All would have in common the interest of thwarting Iran's outsized regional ambitions. Mr. Obama's envoy, former senator George J. Mitchell, has been seeking to broker initial confidence-building measures that might include Arab grants of overflight rights or trade privileges to Israel in exchange for a settlement freeze. Mr. Netanyahu is intrigued by the potential of a de facto Israel-Arab alliance on Iran; he and Mr. Obama agreed to set up working groups to consider what can be done. But the Israeli leader will be inclined to indefinitely delay any significant Israeli moves; were he to commit himself to a Palestinian state or a settlement freeze, his governing coalition might well collapse.

It may be that a mere show of U.S. sleeve-rolling on the peace process, along with pro forma Israeli cooperation, will provide adequate cover for Arab states that are eager to join in an anti-Iranian alliance. That is what Mr. Netanyahu is calculating. If Mr. Obama genuinely intends to press for an early Israeli-Palestinian settlement, he will have to push U.S.-Israeli relations into a red zone of tension for the first time in many years. He would do well to make clear to Israeli voters that any government that will not explicitly embrace Palestinian statehood or an end to settlements will not have smooth relations with Washington. Even if that does not lead to a Middle East peace, it could help lay the groundwork for one in the future.

2a) Washington Watch: Ex-AIPACer: There is no military option in Iran
By Douglas Bloomfield

There is no viable military option for dealing the Iranian nuclear threat, and efforts by the Israeli government and its supporters to link that threat to progress in peace with the Palestinians and Syria are "nonsense" and an obstacle to the Arab-Israeli and international cooperation essential to changing Iranian behavior.

That's the conclusion of Keith Weissman, the Iran expert formerly at the American Israel Public Affairs Committee (AIPAC), speaking publicly for the first time since the government dropped espionage charges against him and his colleague, Steve Rosen, earlier this month.

There's no assurance an attack on Iran's nuclear facilities - even if all of them could be located - would be anything more than a temporary setback, Weissman told me. Instead, a military strike would unify Iranians behind an unpopular regime, ignite a wave of retaliation that would leave thousands dead from Teheran to Tel Aviv, block oil exports from the Persian Gulf and probably necessitate a ground war, he said.

"The only viable solution is dialogue. You don't deal with Iran with threats or preaching regime change," said Weissman, who has lived in Iran, knows Farsi (as well as Arabic, Turkish and French) and wrote his doctoral dissertation at the University of Chicago on Iranian history. That's where the Bush administration went wrong, in his view.

"President Bush's demand that Iran halt all nuclear enrichment before we would talk with the regime was an excuse not to talk at all," Weissman said. "And the administration's preaching of regime change only made the Iranians more paranoid and told them there was no real desire to engage them, only demonize them. The thing they fear most is American meddling in their internal politics."

HE SAID PRESIDENT Barack Obama is right to make it clear that regime change is not our goal. "Without that assurance we can't begin any dialogue or hope to be able to do anything about their nuclear program. Without a doubt, talking with Iran will be very difficult and frustrating, but there are no other viable options."

AIPAC has been the driving force on Capitol Hill for a get-tough policy, pushing through Congress a series of sanction bills, and Weissman was the lobby's expert on the topic.

"All along the idea was that sanctions were a bargaining chip to be traded for something tangible," he said. "We never opposed America and Iran talking to each other about these issues. However, the US strategy should have been directed at the supreme leader; he's the guy at the top and the one who makes the important decisions, not politicians like presidents Khatami or Ahmadinejad."

Weissman said Israel's worries about Iran getting a nuclear weapon are understandable, but despite some of the rhetoric coming out of Teheran, the Iranian leaders "are not fanatics and they're not suicidal. They know that Israel could make Iran glow for many years." He was referring to reports that Israel may have 200 or more nuclear weapons as well as the missiles and aircraft for devastating retaliation.

He believes Iran has the know-how to build a nuclear device, but he doubts it's made the final decision to go ahead with it. Iran may be "a few years or more" away from having an actual weapon and the means for accurate delivery.

"However, they would be crazy to test a weapon," he said. "That would essentially unite the world against them. Right now we can't get Russia and China to seriously help us deal with Iran, but if the Iranians tested a weapon, that would change in a flash. I don't think the Iranians are that stupid."

THE ARAB STATES, especially in the Gulf, are at least as worried as Israel about Iran's nuclear ambitions, and they should all be working together to deal with it, Weissman said, "but because nothing is moving on the Palestinian problem, there can't be any overt and probably little if any covert cooperation."

Trying to separate the issues, even refusing to endorse the two-state approach, "is part of the sophistry of people like [Binyamin] Netanyahu who want to avoid confronting the peace process," he said. "Iran's ability to screw around in the Israel-Arab arena would be severely impaired by pressing ahead on the Palestinian and Syrian tracks instead of looking for excuses not to."

"We're going to have to end up accepting some kind of peaceful Iranian nuclear energy program - and they actually need it; it's already too late to stop it entirely. That's why it is so important to establish a relationship with Iran in which they accept international inspection and obey international law," he said. "For that to happen, there has to be a discussion of some overarching security architecture for the region that includes both Israel and the Arabs, but before that can even be considered there has to be Arab-Israel reconciliation."

The end of his long legal nightmare also ended Weissman's public silence, and now that he's out from under AIPAC's anti-media paranoia, he feels free to express his own views for the first time in a decade.

What's next for Weissman? "I don't know. I couldn't seriously look for work with this case hanging over my head."




3)Car Crazy: Bankrupt companies making 39 mpg autos.

At the end of his Rose Garden explanation yesterday of the new U.S. fuel-efficiency standards, President Obama remarked on the good that can be accomplished when we are "working together." The President may be getting ahead of himself. Watching the unlikely coalition arrayed behind him as Mr. Obama committed the U.S. to an astonishing passenger-car mileage average of 39 miles per gallon by 2016, it looks truer to say we are merely standing together in this adventure, for better or worse.

Mr. Obama's fleet-mileage partners yesterday included the two auto companies that have fallen into his arms, Chrysler and GM, still-independent Ford, the major foreign manufacturers, United Auto Workers chief Ron Gettelfinger, and beaming representatives from the Sierra Club, Environmental Defense Fund and the Union of Concerned Scientists.

All that's left to arrive at the President's new destination for the American way of driving are huge, unanswered questions about technology, financing and the marketability of cars that will be small and expensive.

Start with technology. The President's proposed standards would raise fuel economy goals higher and faster than even the National Highway Transportation Safety Administration believes is practical. Last year, NHTSA issued a proposed rule making that would have raised fuel economy to 32.2 mpg by 2015 for cars and light trucks combined. Its 376-page report notes that "the resources used to meet overly stringent CAFE standards . . . would better be allocated to other uses such as technology research and development, or improvements in vehicle safety."

The new U.S. fleet will almost certainly be made up of hybrids and electric cars. This comports with the explicit intention of the President and his environmental partners to back out fossil fuels. One may ask: Once Detroit is forced to build these cars, will free Americans want to buy them, at any price?

Unless we outlaw the bigger cars that recent sales figures have shown Americans prefer any time gas prices fall below $4 per gallon, Detroit will need help marketing these small vehicles. As GM's Bob Lutz put it not long ago, "Very few people will want to change what has been their 'nationality given' right to drive big and bigger if the price of gas is $1.50 or $2 or even $2.50. Those prices will put the CAFE-mandated manufacturers at war with their customers."

All solutions to this problem flow from Washington. One would be to give substantial tax subsidies to buyers. Another would be to impose a federal gas tax to jack up the price of gasoline to $4 per gallon and keep it there. This is the solution that keeps Europeans driving small cars with tiny engines. High gasoline prices have become a political third rail in U.S. politics, and the Obama Administration insists it isn't interested in subsidies or taxes.

That puts the burden back on the beleaguered auto makers. The Detroit Three already sell small cars at a loss to meet the current 27.5 mpg fleet average. The car companies may hope that if the whole industry is forced to move up the fuel-economy ladder, consumers will have no choice other than to buy these cars. But experience suggests companies that have specialized in making smaller cars, such as the Japanese-owned auto makers, are more likely to be able to sell them at a profit.

Mr. Obama said a lot yesterday about the promised benefits of all this for the environment but not much about return on investment for the auto sellers. These public goals notwithstanding, it still looks as if Ford, Chrysler and GM will be making cars they can't sell, or can't sell profitably. That might not be a problem if you're now Gettelfinger Motors. But still-independent Ford has private shareholders and creditors to answer. While GM and Chrysler attempt to meet the new standards with taxpayer money, Ford will have to do so on its own.

The real carrot the Administration offered the industry yesterday was a detour from the nightmare of state-mandated standards. California has been seeking a waiver from the Administration to impose its own higher mileage standards, and a number of other states have followed suit. The Obama national proposal indeed offers the industry what he called "consistency."

So yes, it is possible to see why this disparate group came together yesterday. The UAW may soon be the government's partner in ownership of GM and Chrysler, and it has a strong incentive not to bite the hand feeding it a huge equity stake in the car makers. Ford and the other foreign-owned auto makers, which will have to raise private capital to make changes that U.S. taxpayers will fund at Chrysler and GM, no doubt want to maintain their political viability by not standing athwart this regulatory steamroller.

We wish these folks luck "working together" with the Obama auto-design team. One thing seems certain by 2016: Taxpayers will be paying Detroit to make the cars Americans don't want, and then they will pay again either through (trust us) a gas tax or with a purchase subsidy. Even the French must think we're nuts.

3a)Why Government Can't Run a Business: Politicians need headlines. Executives need profits.
By JOHN STEELE GORDON

The Obama administration is bent on becoming a major player in -- if not taking over entirely -- America's health-care, automobile and banking industries. Before that happens, it might be a good idea to look at the government's track record in running economic enterprises. It is terrible.

In 1913, for instance, thinking it was being overcharged by the steel companies for armor plate for warships, the federal government decided to build its own plant. It estimated that a plant with a 10,000-ton annual capacity could produce armor plate for only 70% of what the steel companies charged.

When the plant was finally finished, however -- three years after World War I had ended -- it was millions over budget and able to produce armor plate only at twice what the steel companies charged. It produced one batch and then shut down, never to reopen.

Or take Medicare. Other than the source of its premiums, Medicare is no different, economically, than a regular health-insurance company. But unlike, say, UnitedHealthcare, it is a bureaucracy-beclotted nightmare, riven with waste and fraud. Last year the Government Accountability Office estimated that no less than one-third of all Medicare disbursements for durable medical equipment, such as wheelchairs and hospital beds, were improper or fraudulent. Medicare was so lax in its oversight that it was approving orthopedic shoes for amputees.

These examples are not aberrations; they are typical of how governments run enterprises. There are a number of reasons why this is inherently so. Among them are:

1) Governments are run by politicians, not businessmen. Politicians can only make political decisions, not economic ones. They are, after all, first and foremost in the re-election business. Because of the need to be re-elected, politicians are always likely to have a short-term bias. What looks good right now is more important to politicians than long-term consequences even when those consequences can be easily foreseen. The gathering disaster of Social Security has been obvious for years, but politics has prevented needed reforms.

And politicians tend to favor parochial interests over sound economic sense. Consider a thought experiment. There is a national widget crisis and Sen. Wiley Snoot is chairman of the Senate Widget Committee. There are two technologies that are possible solutions to the problem, with Technology A widely thought to be the more promising of the two. But the company that has been developing Technology B is headquartered in Sen. Snoot's state and employs 40,000 workers there. Which technology is Sen. Snoot going to use his vast legislative influence to push?

2) Politicians need headlines. And this means they have a deep need to do something ("Sen. Snoot Moves on Widget Crisis!"), even when doing nothing would be the better option. Markets will always deal efficiently with gluts and shortages, but letting the market work doesn't produce favorable headlines and, indeed, often produces the opposite ("Sen. Snoot Fails to Move on Widget Crisis!").

3) Governments use other people's money. Corporations play with their own money. They are wealth-creating machines in which various people (investors, managers and labor) come together under a defined set of rules in hopes of creating more wealth collectively than they can create separately.

So a labor negotiation in a corporation is a negotiation over how to divide the wealth that is created between stockholders and workers. Each side knows that if they drive too hard a bargain they risk killing the goose that lays golden eggs for both sides. Just ask General Motors and the United Auto Workers.

But when, say, a school board sits down to negotiate with a teachers union or decide how many administrators are needed, the goose is the taxpayer. That's why public-service employees now often have much more generous benefits than their private-sector counterparts. And that's why the New York City public school system had an administrator-to-student ratio 10 times as high as the city's Catholic school system, at least until Mayor Michael Bloomberg (a more than competent businessman before he entered politics) took charge of the system.

4) Government does not tolerate competition. The Obama administration is talking about creating a "public option" that would compete in the health-insurance marketplace with profit-seeking companies. But has a government entity ever competed successfully on a level playing field with private companies? I don't know of one.

5) Government enterprises are almost always monopolies and thus do not face competition at all. But competition is exactly what makes capitalism so successful an economic system. The lack of it has always doomed socialist economies.

When the federal government nationalized the phone system in 1917, justifying it as a wartime measure that would lower costs, it turned it over to the Post Office to run. (The process was called "postalization," a word that should send shivers down the back of any believer in free markets.) But despite the promise of lower prices, practically the first thing the Post Office did when it took over was . . . raise prices.

Cost cutting is alien to the culture of all bureaucracies. Indeed, when cost cutting is inescapable, bureaucracies often make cuts that will produce maximum public inconvenience, generating political pressure to reverse the cuts.

6) Successful corporations are run by benevolent despots. The CEO of a corporation has the power to manage effectively. He decides company policy, organizes the corporate structure, and allocates resources pretty much as he thinks best. The board of directors ordinarily does nothing more than ratify his moves (or, of course, fire him). This allows a company to act quickly when needed.

But American government was designed by the Founding Fathers to be inefficient, and inefficient it most certainly is. The president is the government's CEO, but except for trivial matters he can't do anything without the permission of two separate, very large committees (the House and Senate) whose members have their own political agendas. Government always has many cooks, which is why the government's broth is so often spoiled.

7) Government is regulated by government. When "postalization" of the nation's phone system appeared imminent in 1917, Theodore Vail, the president of AT&T, admitted that his company was, effectively, a monopoly. But he noted that "all monopolies should be regulated. Government ownership would be an unregulated monopoly."

It is government's job to make and enforce the rules that allow a civilized society to flourish. But it has a dismal record of regulating itself. Imagine, for instance, if a corporation, seeking to make its bottom line look better, transferred employee contributions from the company pension fund to its own accounts, replaced the money with general obligation corporate bonds, and called the money it expropriated income. We all know what would happen: The company accountants would refuse to certify the books and management would likely -- and rightly -- end up in jail.

But that is exactly what the federal government (which, unlike corporations, decides how to keep its own books) does with Social Security. In the late 1990s, the government was running what it -- and a largely unquestioning Washington press corps -- called budget "surpluses." But the national debt still increased in every single one of those years because the government was borrowing money to create the "surpluses."

Capitalism isn't perfect. Indeed, to paraphrase Winston Churchill's famous description of democracy, it's the worst economic system except for all the others. But the inescapable fact is that only the profit motive and competition keep enterprises lean, efficient, innovative and customer-oriented.

Mr. Gordon is the author of "An Empire of Wealth: The Epic History of American Economic Power" (HarperCollins, 2004).

4) U.S. May Add New Financial Watchdog:Consumer Agency Under Consideration
By Zachary A. Goldfarb, Binyamin Appelbaum and David Cho




The Obama administration is actively discussing the creation of a regulatory commission that would have broad authority to protect consumers who use financial products as varied as mortgages, credit cards and mutual funds, according to several sources familiar with the matter.

The proposed commission would be one of the administration's most significant steps yet to overhaul the financial regulatory system. It would also be one of its first proposals to address causes of the financial crisis such as predatory mortgage lending.

Plans for a new body remain fluid, but it could be granted broad powers to make sure the terms and marketing of a wide range of loans and other financial products are in the interests of ordinary consumers, sources said.

Sources, who spoke on condition of anonymity because discussions are ongoing, said talks have begun with industry officials, lawmakers and other financial experts about the proposal, which would require legislation. Last night, senior policymakers, including Treasury Secretary Timothy F. Geithner and National Economic Council Director Lawrence H. Summers, were to discuss the idea at a dinner held at the Treasury Department.

Responsibility for regulation of consumer financial products is currently distributed among a patchwork of federal agencies. Some of these regulators regard consumer protection as a low priority. And some financial products are not regulated at all.

The proposal could centralize enforcement of existing laws and create a vehicle for imposing tougher rules.

The idea is likely to face significant opposition from industry groups, which argue that stricter regulation limits the availability of financial products to consumers.

It could also trigger a massive regulatory turf war. Banking regulators and agencies such as the Securities and Exchange Commission, which regulates mutual funds, could stand to lose powers, personnel and funding. Those agencies are likely to argue they are positioned to protect consumers because they oversee the financial firms directly and have experience writing and enforcing rules governing financial products.

The proposal is part of the administration's broader plan to improve financial regulation. Officials have proposed the creation of a systemic risk regulator whose job would be to spot threats to the health of the overall financial system. Officials also have called for tighter regulation of individual financial firms and markets, including new rules governing hedge funds and derivatives.

While those proposals focus on the guts of the financial system, this new plan would concentrate on the front end -- consumers who borrow money to buy homes and products and who invest their money for retirement, college education and savings.

The leading proponent of such a commission is Elizabeth Warren, a Harvard University law professor who now chairs the Congressional Oversight Panel for the government's financial rescue initiative. Her plan is the kernel of the idea the White House is now considering, sources said.

Warren wrote in a 2007 article in the journal Democracy that the government had failed to protect American consumers in their relationships with financial companies.

"It is impossible to buy a toaster that has a one-in-five chance of bursting into flames and burning down your house. But it is possible to refinance an existing home with a mortgage that has the same one-in-five chance of putting the family out on the street," Warren wrote. "Why are consumers safe when they purchase tangible consumer products with cash, but when they sign up for routine financial products like mortgages and credit cards they are left at the mercy of their creditors?"

Warren proposed creating a new commission modeled on the Consumer Product Safety Commission, which protects buyers of products such as bicycles and baby cribs.

Such a commission could be very powerful. A number of sweeping federal laws already offer broad protection to consumers of financial products, but those laws have been lightly enforced in recent years.

The Department of Housing and Urban Development, for example, has clear authority to crack down on companies that charge excessive closing costs on mortgage loans, but repeatedly postponed planned reforms in the face of industry opposition.

Warren's proposal initially found little support in Washington, but the mood has shifted dramatically with the onset of the financial crisis and the election of a Democratic administration.

In March, Sen. Richard J. Durbin (D-Ill.) introduced legislation to create a commission like the one that Warren had described. The legislation is co-sponsored by Sen. Charles E. Schumer (D-N.Y.) and Sen. Edward M. Kennedy (D-Mass.). The White House's support would greatly improve its chances of passing.

In proposing the legislation, the senators said that the commission would be responsible for identifying emerging problems and for educating consumers.

They were also critical of the existing process.

"The Federal Reserve was supposed to do this, but they were asleep at the switch," Schumer said at the time.

Staff writer Neil Irwin contributed to this report.

5) A Small Man
By John Podhoretz

This blog has had many differences with Joe Klein of Time magazine, whom I once considered a very friendly acquaintance before he accused me and those who argued for an aggressive policy in Iraq and with Iran of being war criminals and began spouting anti-Semitic conspiracy nonsense that, were his name Christiansen instead of Klein, would have seen him booted from the payroll of Time magazine faster than you could say Rickstengel. Now he has done something low and indefensible even for him. In an interview with Politico, Klein ascribes what he views as the deficiencies in Charles Krauthammer’s worldview to the fact that Krauthammer is a quadraplegic:

“He became Ground Zero among the neo-cons, but he’s vastly smarter than most of them,” said Time’s Joe Klein, an admirer and critic who praised Krauthammer’s “writing skills and polemical skills” as “so far above almost anybody writing columns today.”

“There’s something tragic about him too,” Klein said, referring to Krauthammer’s confinement to a wheelchair, the result of a diving accident during his first year of medical school. “His work would have a lot more nuance if he were able to see the situations he’s writing about.”

Is it conceivable that Joe Klein is saying a man in a wheelchair is incapable of understanding the nuances of Iraq and the war on terror because he can’t get on a plane and go there like Joe Klein can? Is it possible, in this day and age, for someone seriously to argue such a thing? We cannot go back in time and visit the battlefields of the Civil War, or Agincourt, or the Peloponnese—are we therefore incapable of seeing their nuances? FDR was in a wheelchair and did not visit the battlefields of World War II-—were its nuances beyond him as well?

The self-infatuation this quote reveals about Klein’s own celebration of his own passport stamps—the words of a lesser author and thinker about one who so surpasses him in clarity and insight that a wiser Klein would have been better off just admitting that he can’t hold a candle to Krauthammer and let it go at that—is striking enough. But let’s face it. This is simply disgusting, no matter how you slice it. Perhaps men and women in wheelchairs, or who are blind, or deaf, or have other infirmities that make their ability to get on a plane and go to Iraq should simply forbear any sort of opinion about such things. They should, instead, be left to Joe Klein.

He won’t like me saying it, but Charles Krauthammer, who is more than a friendly acquaintance, is far from a tragic figure. He is a miraculous figure. He has, through a combination of raw will and a sagacious mind and a rigorous temperament that, were it possible, he should leave to science so that it can be studied and bottled and sold, lived a life both triumphantly important and triumphantly ordinary. (Although his wife, Robbie, is far from ordinary. For one thing, she is from Tasmania. For another, she is an artist of great skill. For a third, she has the dirtiest and liveliest mouth in either her forsaken hemisphere or her present one.) If you are his friend, in a fashion that I can’t quite explain, you come to have no sense whatever that he is in that chair. He may be right about what he argues (obviously, I think so, most of the time). He may be wrong. But whatever he is or is not, to argue that Charles’s views are restricted by the restrictions on his physical form is do violence to the most basic notions of civil discussion.

“Klein” means small in German. Trollope could not have come up with a more apt name for a character.